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Thursday 23 June 2016
Attorney General Loretta E. Lynch Statement on the U.S. Supreme Court Ruling in Fisher v. University of Texas at AustinRead the Press Release
Attorney General Loretta E. Lynch released the following statement today on the U.S. Supreme Court ruling in Fisher v. University of Texas at Austin:
“I am pleased that the Supreme Court has recognized our compelling interest in ensuring diversity in higher education.
“Diverse student enrollment is a vital part of America’s educational experience. It creates a positive forum for scholarship and discovery, offering the opportunity for young people to learn from, interact with, and work alongside individuals of different backgrounds. It promotes a stronger workforce, allowing employers and businesses to harness the wide range of experience and expertise they need to compete and win in today’s global economy. And it aligns with the most cherished values of our country: opportunity, inclusion, and the notion that out of many disparate backgrounds, we are joined together as one united community. Our country is stronger, more credible, and more effective when our educational institutions include highly-qualified individuals with roots, cultures, and traditions that reflect our nation’s rich diversity. Going forward, the Department of Justice will continue to stand up for these principles, and to work with colleges and universities to promote diversity in a way that is consistent with the law.”
Attorney General Loretta E. Lynch Announces Extradition of Five Defendants Charged in Connection with Mexican Sex Trafficking EnterpriseRead the Press Release
Charged Offenses Include Sex Trafficking, Interstate Prostitution, Alien Smuggling, Money Laundering, Racketeering and Racketeering Conspiracy in Connection with Scheme to Compel Mexican Women and Girls into Prostitution in the United States
Five defendants were arraigned in federal court today following their extradition from Mexico on charges of sex trafficking and related violations as the latest development resulting from coordinated bilateral human trafficking enforcement efforts.
Attorney General Loretta E. Lynch, Director Sarah R. Saldaña of U.S. Immigration and Customs Enforcement (ICE); Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division, and U.S. Attorney Robert L. Capers of the Eastern District of New York made the announcement.
Jovan Rendon-Reyes, aka Jovani, 32; Guillermina Rendon-Reyes, 44; Jose Rendon-Garcia, aka Gusano, 32; Felix Rojas, 45; and Severiano Martinez-Rojas, 50, were arraigned before U.S. Magistrate Judge James Orenstein of the Eastern District of New York on a 27-count indictment following their extradition from Mexico. The indictment, which was unsealed on Nov. 19, 2015, charges eight defendants with racketeering and racketeering conspiracy involving predicate acts of sex trafficking by force, fraud and coercion; sex trafficking of minors; interstate prostitution; alien smuggling; money laundering and related offenses. Three co-defendants charged in the same indictment, Saul Rendon-Reyes, aka Satanico, 37; Francisco Rendon-Reyes, aka Pancho, 27; and Odilon Martinez-Rojas, aka Chino and Saul, 44, were arraigned in the Eastern District of New York on Nov. 19, 2015.
“Human trafficking is a heinous crime that preys upon the most vulnerable members of our society,” said Attorney General Lynch. “Today, as part of the Department of Justice’s ongoing efforts to end this appalling practice, we are proud to announce the extradition of five Mexican traffickers who smuggled women and girls into the United States as sex slaves. Our action would not be possible without the close cooperation of our partners in Mexican law enforcement, and I want to thank them for their ongoing commitment to working together to uphold the rule of law in both of our countries. Going forward, we will continue to stand with Mexico – and with all of our international partners – to end human trafficking and to bring all those who facilitate this crime to justice.”
“These five extraditions speak to the strong bilateral relationship and commitment between the United States and Mexico to holding those alleged to have engaged in the ruthless act of human trafficking accountable,” said Director Saldaña. “ICE Homeland Security Investigations (HSI) will continue leveraging all of its investigative capabilities to disrupt human trafficking syndicates no matter where in the world they operate.”
“Vindicating the rights of vulnerable individuals is among the highest priorities of the Department of Justice and the Civil Rights Division,” said Principal Deputy Assistant Attorney General Gupta. “The defendants are charged with operating a scheme across international borders to exploit young women and girls by prostituting them for the benefit of the defendants. We will work tirelessly to pursue justice for those held in modern-day slavery.”
“The extradition of these five defendants is an important step in our effort to bring some sense of closure to the victims of this terrible crime, and a testament to our resolve to end human trafficking,” said U.S. Attorney Capers. “Our commitment to prosecute sex traffickers and those who would enslave others is unwavering. We would like to extend our deep gratitude to the government of Mexico and our law enforcement partners who made it possible to bring these defendants to the United States so that we may seek justice for their victims.”
The indictment alleges that the defendants were members of an international criminal organization, identified in the indictment as the Rendon-Reyes Trafficking Organization, which engaged in sex trafficking and related criminal activity between December 2004 and June 2014 in Queens, New York; Atlanta; and Jemison, Alabama, among other locations. According to the allegations in the indictment, the defendants used force, threats of force, fraud and coercion to cause young women and girls from Mexico and Latin America to engage in prostitution in the United States.
Since 2009, the Department of Justice and HSI have collaborated with Mexican law enforcement counterparts in a Bilateral Human Trafficking Enforcement Initiative aimed at strengthening high-impact prosecutions under both U.S. and Mexican law. The initiative is aimed at dismantling human trafficking networks operating across the U.S.-Mexico border, bringing human traffickers to justice, reuniting victims with their children and restoring the rights and dignity of human trafficking victims, held under the trafficking networks’ control. These efforts have resulted in successful prosecutions in both Mexico and the United States, including U.S. federal prosecutions of more than 50 defendants in multiple cases in New York, Georgia, Florida and Texas since 2009, and numerous Mexican federal and state prosecutions of associated sex traffickers. The extraditions in this case are the latest development in the Eastern District of New York’s comprehensive anti-trafficking program, which has to date indicted more than 65 defendants in sex trafficking cases and provided assistance to more than 130 victims, including 36 minors. In addition, through the Eastern District of New York’s anti-trafficking program, 18 children have been reunited with their victim-mothers.
The charges in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
In announcing the extradition and arraignment, Attorney General Lynch, Director Saldaña, Principal Deputy Assistant Attorney General Gupta and U.S. Attorney Capers commended the HSI’s New York Office, the HSI Mexico Attaché Office, the Department of Justice’s Office of International Affairs, the State Department and the New York City Police Department for their assistance and praised the government of Mexico for its role in advancing bilateral anti-trafficking enforcement efforts.
The case is being prosecuted by Assistant U.S. Attorneys Taryn A. Merkl and Margaret Lee of the Eastern District of New York and Deputy Director Benjamin Hawk of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Rendon-Reyes et al Indictment
Arturo Puello of Queens, New York, Sentenced for Possessing Counterfeit United States CurrencyRead the Press Release
The Office of the United States Attorney for the District of Vermont announced that Arturo Puello, age 32, of Queens, New York, was sentenced on June 22, 2016 in the U.S. District Court in Brattleboro, Vermont, for possessing counterfeit United States currency. Judge J. Garvan Murtha sentenced Puello to five months imprisonment, followed by two years of supervised release. The Court based its sentence on an analysis of all the relevant sentencing factors, and Puello’s sentence of five months imprisonment was within the range recommended by the advisory federal sentencing guidelines.
The case began on May 16, 2015 when a Bellows Falls, Vermont police officer found Puello’s vehicle disabled on the side of Vermont Route 5. After speaking with Puello and other occupants of the disabled vehicle, police conducted a search of the vehicle, which resulted in the discovery of $15,000 in counterfeit United States currency in a compartment in the cargo area of the vehicle. Puello subsequently admitted to possessing the counterfeit notes and stated that he had received them from a man in New York and transported them to Vermont. Puello pled guilty in federal court to the charged offense on February 2, 2016.
The case against Puello was investigated by the United States Secret Service and the Bellows Falls Police Department.
The United States was represented in the case by Assistant United States Attorney Kunal Pasricha. Puello was represented by Assistant Federal Public Defendant David L. McColgin.
Albuquerque Businessman Pleads Guilty to Federal Tax Evasion ChargeRead the Press Release
ALBUQUERQUE – James E. Coleman, Jr., the former president and owner of Sneakerz, Inc., a corporation that operated “Sneakerz Sports Bar” in Albuquerque, N.M., pleaded guilty this morning in federal court to a tax evasion charge, announced U.S. Attorney Damon P. Martinez and Ismael Nevarez Jr., Special Agent in Charge of the Phoenix Field Office of IRS Criminal Investigation.
Coleman, 58, was charged in Nov. 2014, in a four-count indictment alleging tax evasion and subscribing false tax returns charges. Counts 1 and 2 charged Coleman with evading $166,320.00 in federal corporate taxes in calendar years 2008 and 2009 by filing false tax returns that underrepresented his corporation’s taxable income. Count 1 charged Coleman with evading $90,661.00 in federal taxes by falsely claiming that his corporation had $621,064.00 in taxable income in calendar year 2008 despite knowing that the corporation had $886,128 in taxable income for that year. Count 2 charged him with evading $75,659.00 in federal taxes by falsely claiming that his corporation had $731,581.00 in taxable income in calendar year 2009 despite knowing that the corporation had $932,235.00 in taxable income for that year. Counts 3 and 4 charged Coleman with filing individual tax returns for calendar years 2008 and 2009 that falsely reported that Coleman received no dividend income and no business income during those two calendar years.
During today’s proceedings, Coleman pled guilty to Count 1 of the indictment and admitted evading a total of $1,045,939.00 in federal corporate and personal taxes between calendar years 2002 and 2009. In his plea agreement, Coleman acknowledged underrepresenting Sneakerz’s gross receipts to the IRS with the intention of evading his corporate tax liability. He also admitted falsely underrepresenting the income he derived from Sneakerz on his personal tax returns.
At sentencing, Coleman faces a maximum statutory penalty of five years in federal prison. Coleman also will be subject to an order requiring that he pay restitution in an amount to be determined by the court.
This case was investigated by the Albuquerque office of IRS Criminal Investigation and is being prosecuted by Assistant U.S. Attorney Jeremy Peña.
Wednesday 22 June 2016
Working with ICE, USMS to Apprehend Criminal AliensRead the Press Release
Over the course of three days, INTERPOL Washington collaborated with Immigration and Customs Enforcement (ICE) and the United States Marshals Service (USMS) in a multi-agency enforcement operation, known as Operation: Project Red II. The goal of the operation was to identify, locate, arrest, and remove criminal fugitive aliens in the United States.
The second iteration of the three-day sweep, which first took place in 2015, targeted aliens who are 1) currently at-large, 2) removable under U.S. immigration law, and 3) wanted for criminal prosecution or convicted of a criminal offense abroad. The USNCB and USMS supported ICE Enforcement and Removal Operations (ERO) agents to remove these fugitives, many of whom were subjects of INTERPOL Red Notices, which act as provisional international arrest warrants in many countries.
For its role, the USNCB collected, organized, and disseminated the INTERPOL information crucial for ICE to identify the operation’s targets, which allowed the agents and deputies to locate criminals they otherwise might never have known existed.
Woman Pleads Guilty for Impersonating FBI Agent in Connection with Lottery Fraud Scheme Based in JamaicaRead the Press Release
A 30-year-old woman pleaded guilty for her role in a Jamaica-based lottery fraud scheme, the Department of Justice announced today.
Vania Lee Allen pleaded guilty in the Southern District of Georgia to one count of conspiracy to commit wire fraud and false impersonation of an employee of the United States. Allen faces a maximum statutory sentence of five years in prison. A sentencing date has not been scheduled.
“Lottery fraud schemes operating from Jamaica targeting Americans typically get help from at least one co-conspirator in the United States,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “Impersonating an FBI agent is just one way fraudsters convince innocent victims that the international lottery is legitimate. It isn’t. The Justice Department will actively pursue and charge those who participate in such criminal activity.”
As part of her guilty plea, Allen acknowledged that she and a co-conspirator in Jamaica sought to unlawfully enrich themselves through a fraudulent lottery scheme targeting an elderly resident of Evans, Georgia.
An indictment charging Allen was filed on March 3. As alleged in the indictment, Allen’s co-conspirator falsely informed the victim that he had won money in a lottery and instructed the victim to make payments to various people in order to collect the purported lottery winnings. As part of her plea agreement, Allen acknowledged in order to induce the victim to continue to make payments as directed by her co-conspirator, Allen traveled from Jamaica to the United States to meet with the victim personally and falsely portrayed herself to the victim as an FBI agent. Allen also acknowledged that when she met the victim, she falsely portrayed herself as a FBI agent, provided the victim with a cell phone, and directed him to speak with the person on the line, who was Allen’s co-conspirator in Jamaica.
“This conviction shows the extraordinary lengths fraudsters will use to rip off someone in the United States,” said U.S. Attorney Edward J. Tarver of the Southern District of Georgia. “Such schemes will not be tolerated, and we will prosecute fraudsters whether they operate from inside or outside of the United States.”
“The Postal Inspection Service is dedicated to investigating and combating international lottery schemes, especially since they prey on elderly Americans,” said Inspector in Charge David W. Bosch of the U.S. Postal Inspection Service’s Philadelphia, Pennsylvania Division. “The Postal Inspection Service is committed to uncovering and pursuing individuals involved in international lottery fraud schemes targeted at victims in the United States.”
This prosecution is part of the Department of Justice’s effort to work with federal and local law enforcement to combat fraudulent lottery schemes in Jamaica that prey on U.S. citizens. According to the U.S. Postal Inspection Service, Americans have lost tens of millions of dollars to fraudulent foreign lotteries.
The case was prosecuted by Trial Attorney Clint Narver of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney C. Troy Clark of the Southern District of Georgia. The case was investigated by the U.S. Postal Inspection Service and the Columbia County Georgia Sherriff’s Office.
For more information about the Consumer Protection Branch, visit its website at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Southern District of Georgia, visit its website at http://www.justice.gov/usao-sdga.
Western Pennsylvania’s U.S. Attorney’s Office Participates in Largest National Medicare Fraud Takedown in HistoryRead the Press Release
PITTSBURGH – Attorney General Loretta E. Lynch and Department of Health and Human Services (HHS) Secretary Sylvia Mathews Burwell announced today an unprecedented nationwide sweep led by the Medicare Fraud Strike Force in 36 federal districts, resulting in criminal and civil charges against 301 individuals, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings. Twenty-three state Medicaid Fraud Control Units also participated in today’s arrests. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) is suspending payment to a number of providers using its suspension authority provided in the Affordable Care Act. This coordinated takedown is the largest in history, both in terms of the number of defendants charged and loss amount.
“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – It is a serious crime,” said Attorney General Loretta Lynch. “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends. The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.”
“Protecting citizens from health care fraud schemes that can devastate lives, undermine the integrity of our health care system and drive up costs for all consumers is a worthy priority for our office,” said David J. Hickton, U.S. Attorney for the Western District of Pennsylvania. “By working cooperatively with the FBI, Health and Human Services Office of Inspector General and Pennsylvania Office of the Attorney General, our office is making good on its promise to crack down on health care fraud wherever we find it.”
Following is a list of recent health care fraud prosecutions handled by the U.S. Attorney’s Office for the Western District of Pennsylvania. Only the first case is included in the nationwide sweep statistics.
June 21, 2016: An information was unsealed charging Elizabeth A. Rotto, 46, of Cranberry Township, Pa., with embezzlement related to health care. The information alleges that Rotto embezzled funds in excess of $100 that belonged to Askesis Development Group, a subsidiary of the University of Pittsburgh Medical Center. A plea hearing is scheduled for tomorrow, June 23, at 2 p.m. before U.S. District Judge David Cercone.
AUSA Robert Cessar; Federal Bureau of InvestigationJune 13, 2016: An indictment was unsealed charging Daniel Garner, a dentist who practices in Pittsburgh, Pa., with distribution of Oxycodone, a Schedule II controlled substance, outside the usual course of professional practice, and omitting material information from required reports, records and other documents. According to the seven-count indictment, from Feb. 13, 2014 through June 11, 2015, Garner distributed Oxycodone on six occasions, a Schedule II controlled substance, outside the usual course of professional practice. The indictment further alleges that on Jan. 14, 2016, Garner omitted material information from an application for a Drug Enforcement Agency registration number.
AUSA Cindy K. Chung; Federal Bureau of Investigation and the Drug Enforcement AdministrationJune 2, 2016: Mary Ann Stewart, former chief operations officer of Horizons Hospice, LLC, pleaded guilty to one count of health care fraud. Horizons Hospice LLC, located in Monroeville, provided end-of-life hospice care to eligible patients. A significant number of patients were eligible for Medicare and Medicaid. Stewart admitted orchestrating a scheme whereby she caused her staff to place non-qualifying patients into hospice care that were not appropriate, and then recertified the patients for continued hospice care. JudgeMcVerry scheduled sentencing for Sept. 9, 2016.
AUSAs Robert S. Cessar and Nelson P. Cohen; Federal Bureau of Investigation, Pennsylvania Attorney General’s Office; Health & Human Services - Office of the Inspector GeneralMay 31, 2016: Kari Richards of Latrobe pleaded guilty to charges of healthcare fraud and obtaining prescription drugs through fraud. Richards, while addicted to prescription pain killers, caused Highmark to pay more than $600,000 in connection with claims in which she sought treatment over a 16-month period from more than 100 hospitals in 11 states on more than 300 occasions. Through this behavior, Richards obtained approximately 190 prescriptions for pain medications, including prescriptions for Oxycodone-Acetaminophen, Hydrocodone-Acetaminophen, Hydrocodone, and Oxycodone. As part of the scheme, Richards falsely represented the circumstances of injuries, which were mainly shoulder dislocations. She also misrepresented the medications that she received and her medical history. Judge Cohill scheduled sentencing for Sept. 7, 2016.
AUSA Brendan T. Conway; Federal Bureau of InvestigationMay 17, 2016: Samirkumar J. Shah was indicted on health care fraud charges. The indictment alleges that Shah knowingly and willfully executed and attempted to execute a scheme to defraud health care benefit programs, such as, Medicare, Medicaid, Highmark, UPMC and Gateway, in connection with the delivery of and payment for health care benefits, items and services.
AUSA Nelson P. Cohen; Federal Bureau of Investigation and the Pennsylvania Attorney General’s OfficeThe Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations and since its inception in March 2007 has charged over 2,900 defendants who collectively have falsely billed the Medicare program for over $8.9 billion.
Including today’s enforcement actions, nearly 1,200 individuals have been charged in national takedown operations, which have involved more than $3.4 billion in fraudulent billings. Today’s announcement marks the second time that districts outside of Strike Force locations participated in a national takedown, and they accounted for 82 defendants charged in this takedown.
The cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide - including the U.S. Attorney’s Office for the Western District of Pennsylvania - along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois and the Middle District of Florida; and agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.
A complaint, indictment or information is merely a charge, and all defendants are presumed innocent unless and until proven guilty.
West Virginia man sentenced for unlawful possession of stolen firearmsRead the Press Release
CLARKSBURG, WEST VIRGINIA – John Basile, 65, of Blacksville, West Virginia was sentenced today to twelve months and one day in prison for unlawful possession of stolen firearms, United States Attorney William J. Ihlenfeld, II, announced.
Basile previously pled guilty to “Possession of Stolen Firearms” for selling stolen guns in Marion and Monongalia County in 2014.
Assistant U.S. Attorney David J. Perri prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated.
U.S. District Judge Irene M. Keeley presided.
West Palm Beach Man Sentenced for Illegally Transporting Undocumented AliensRead the Press Release
Fort Myers, Florida – U.S. District Judge Sheri Polster Chappell has sentenced Yohany Hernandez-Hernandez (38, West Palm Beach) to three years in federal prison for illegally transporting undocumented aliens. A federal jury found him guilty in March 2016.
According to evidence presented at trial, on May 7, 2015, Hernandez-Hernandez was stopped by deputies from the Lee County Sheriff’s Office for committing a traffic infraction on I-75. During the traffic stop, the deputies became aware that he was transporting six undocumented aliens. Law enforcement later learned that Hernandez-Hernandez and the undocumented aliens had travelled from a safe house in Houston, Texas to Lee County. They had driven for approximately 22 hours, with limited stops, in an attempt to avoid being detected by immigration officials. The investigation further revealed that two other undocumented aliens had previously been dropped off in other parts of Florida. The aliens had been transported to further their stay in the United States and for Hernandez-Hernandez’s financial gain.
This case was investigated by the Lee County Sheriff’s Office and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI). It was prosecuted by Assistant United States Attorney Michael C. Baggé-Hernández.
Two North Suburban Doctors Charged as Part of Largest National Medicare Fraud Takedown in HistoryRead the Press Release
CHICAGO — Two north suburban doctors have been charged as part of the largest national Medicare fraud takedown in history, federal authorities announced today.
Attorney General Loretta E. Lynch and Department of Health and Human Services Secretary Sylvia Mathews Burwell announced the unprecedented nationwide sweep that resulted in criminal and civil charges against 301 individuals, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings. Twenty-three state Medicaid Fraud Control Units participated in the takedown. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) is suspending payment to a number of providers using its suspension authority provided in the Affordable Care Act. This coordinated takedown is the largest in history, both in terms of the number of defendants charged and the loss amount.
“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – it is a serious crime,” said Attorney General Lynch. “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends. The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.”
Two registered Illinois physicians were charged as part of the investigations, announced Zachary T. Fardon, United States Attorney for the Northern District of Illinois.
DR. YEVGENY ODESSKY, a physician with an office in Buffalo Grove, took cash kickbacks in exchange for referring patients to a home health care agency in the north suburbs, according to a criminal complaint filed last week in federal court in Chicago. Unbeknownst to Dr. Odessky, the owner of the agency was cooperating with federal authorities and had agreed to secretly record meetings with Dr. Odessky, according to the complaint. In one recorded meeting in Dr. Odessky’s clinic on April 26, 2014, Dr. Odessky agreed to accept $300 for each Medicare beneficiary he referred to the agency, according to the complaint. Speaking in Russian, Dr. Odessky is heard on the recording laughing while telling the agency owner, “Public Aid will choke,” according to the complaint.
Dr. Odessky, 66, of Highland Park, is charged with one count of violating the federal Medicare and Medicaid Anti-Kickback Statute, which is punishable by up to five years in prison and a fine of up to $250,000. A preliminary hearing in federal court in Chicago is scheduled for July 11, 2016, at 1:00 p.m.
DR. ZOYA KOSMAN, a physician with an office in Skokie, allegedly caused the submission of false medical evidence to help a claimant obtain federal disability benefits to which the claimant was not entitled. Dr. Kosman knowingly lied about the claimant’s complaints, symptoms, and functional abilities in documentation submitted in support of the claimant’s application for benefits, according to an indictment returned yesterday in federal court in Chicago.
The indictment charges Dr. Kosman, 58, of Skokie, with one count of making false statements in an application for federal benefits. The charge carries a maximum sentence of ten years in prison and a fine of up to $250,000. An arraignment in federal court in Chicago has not yet been scheduled.
The cases announced today were investigated by the national Medicare Fraud Strike Force, whose operations are part of the Health Care Fraud Prevention & Enforcement Action Team. Since its inception in March 2007, the Strike Force has charged more than 2,900 defendants who collectively have falsely billed the Medicare program more than $8.9 billion.
The Illinois cases are being prosecuted by the U.S. Attorney’s Office for the Northern District of Illinois. The government in Dr. Odessky’s case is represented by Assistant U.S. Attorney Nathalina A. Hudson, and in Dr. Kosman’s case by Special Assistant U.S. Attorney Jared C. Jodrey.
The national cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide, along with agents from the Federal Bureau of Investigation, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.
The public is reminded that charges are not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Two Charged in Dothan, Alabama as Part of Largest National Medicare Fraud Takedown in HistoryRead the Press Release
Montgomery, Alabama – U.S. Attorney George L. Beck Jr., Alabama Attorney General Luther Strange, United States Attorney General Loretta E. Lynch, and Department of Health and Human Services (HHS) Secretary Sylvia Mathews Burwell, announced today an unprecedented nationwide sweep led by the Medicare Fraud Strike Force in 36 federal districts, resulting in criminal and civil charges against 301 individuals, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings. Twenty-three state Medicaid Fraud Control Units also participated in today’s arrests. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) is suspending payment to a number of providers using its suspension authority provided in the Affordable Care Act. This coordinated takedown is the largest in history, both in terms of the number of defendants charged and loss amount.
“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – It is a serious crime,” said Attorney General Lynch. “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends. The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.”
As a part of the nationwide takedown, U.S. Attorney Beck and Attorney General Strange announce the arrests of two Dothan, Alabama-area residents on charges of defrauding the Alabama Medicaid Agency and the federal government by billing for counseling services that were never provided.
Catrina R. Copeland, 43, of Dothan, was the owner of The Counseling Place, a Dothan company that contracted with the Alabama Medicaid Agency to provide counseling services to at risk youth. Stephanie Govan, 41, a resident of Glenwood, was employed by Copeland as a counselor. Both were arrested on June 21, 2016 by agents of the Alabama Attorney General’s Medicaid Fraud Control Unit and the HHS’s Office of Inspector General.
A federal grand jury indicted Copeland and Govan in April of 2016 following an investigation by the Alabama Attorney General’s Medicaid Fraud Control Unit. The grand jury charges include counts against each individual for conspiracy to commit healthcare fraud. This alleged fraud is based upon evidence that indicates Copeland and Govan billed the Medicaid Agency for counseling services that were never actually provided. If convicted, each could be sentenced for up to ten years in prison.
An indictment merely alleges that crimes have been committed. The defendants are presumed innocent until proven guilty beyond a reasonable doubt.
The Dothan, Alabama case was investigated by the Alabama Attorney General’s Medicaid Fraud Control Unit and the HHS’s Office of Inspector General. Assistant U.S. Attorney Jonathan S. Ross and Assistant Attorney General Bruce Lieberman are prosecuting the case.
“Health care fraud robs all of us by resulting in increased medical costs, health insurance premiums, and eventually, higher taxes,” stated U.S. Attorney Beck. “Medical providers need to know there is no ‘safe harbor’ from lying and cheating.”
“Those who choose to commit heath care fraud do so at the expense of the most vulnerable of our society who are dependent upon these programs,” said Attorney General Strange. “Protecting taxpayer resources is a high priority of my office and I am pleased to join the U.S. Attorney George Beck in targeting costly Medicaid fraud.”
The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations and since its inception in March 2007 has charged over 2,900 defendants who collectively have falsely billed the Medicare program for over $8.9 billion.
Including today’s enforcement actions, nearly 1,200 individuals have been charged in national takedown operations, which have involved more than $3.4 billion in fraudulent billings. Today’s announcement marks the second time that districts outside of Strike Force locations participated in a national takedown, and they accounted for 82 defendants charged in this takedown.
The cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide, along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois and the Middle District of Florida; and agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.
The court documents for each case will posted online, as they become available, here: https://www.justice.gov/opa/documents-and-resources-june-22-2016-medicare-fraud-strike-force-press-conference
Two Buffalo Men Sentenced on Crack Cocaine ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Morrell Buster, 43, and William Jefferson, 46, both of Buffalo, NY, who were convicted of possession with intent to distribute, and distribution of crack cocaine, were sentenced to 51 months and 37 months in prison respectively by Senior U.S. District William M. Skretny.
Assistant U.S. Attorney Timothy C. Lynch, who is handling the case, stated that between June 2013 and February 25, 2014, the defendants purchased and then distributed crack cocaine. On January 17, 2014, Buster was found in possession of three grams of crack cocaine while at the Niagara Outlet Mall in Niagara County, NY.
The sentencings are the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen and the Lackawanna Police Department, under the direction of Chief James Michel.
Two Brothers Charged with Distributing Heroin Involved in OverdosesRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, and Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration for New England, today announced that an investigation into a recent drug overdose death of a man in Monroe and a non-fatal overdose of a man in Bridgeport has resulted in federal heroin distribution charges against two brothers. The charges stem from an ongoing statewide initiative targeting narcotics dealers who distribute heroin, fentanyl or opioids that cause death or serious injury to users.
ERICK DELGADO, 39, and his brother, ANORIS DELGADO, also known as “Alex,” 28, both of Bridgeport, were arrested yesterday on federal criminal complaints charging each with possession with intent to distribute, and distribution of, heroin, and conspiracy to distribute heroin. They appeared today before U.S. Magistrate Judge Sarah A. L. Merriam in New Haven and are detained. A detention hearing is scheduled for July 6.
As alleged in court documents, in the morning of April 25, 2016, Bridgeport Police and medical personnel responded to a location on Washington Avenue on a report of a possible drug overdose. The overdose victim was revived with two doses of Narcan and was transported to the hospital. A friend of the victim, who was with the victim at the time and contacted medical professionals after the overdose, told investigators that he and the victim purchased heroin from and individual he knew as “Eric” in the area of Brooks Street and Ogden Street in Bridgeport. The victim subsequently identified ERICK DELGADO as the source of the heroin he used.
It is also alleged that in the evening of April 25, 2016, Monroe Police and emergency medical personnel responded to a report of an unresponsive 48-year-old male at residence in Monroe. The victim was pronounced dead at the scene. A subsequent interview with an acquaintance of the victim revealed that, on April 25, the victim and his acquaintance traveled to the area of Brooks Street and Ogden Street where the victim purchased heroin from ERICK DELGADO.
It is further alleged that on May 3, 2016, an individual working with law enforcement contacted ERICK DELGADO to arrange the purchase of heroin. When the individual and an undercover officer arrived in the area of Brooks Street and Ogden Street, they were met by ANORIS DELGADO who subsequently provided them with 20 bags of heroin. The undercover officer purchased another 20 bags of heroin from ANORIS DELGADO on May 20.
U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations, and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Drug Enforcement Administration’s New Haven Tactical Diversion Squad, and the Monroe and Bridgeport Police Departments. The Task Force includes participants from the New Haven, Hamden, Greenwich, Shelton, Bristol, Vernon, Wilton, Milford, Monroe, Fairfield and Middlebury Police Departments, and the Connecticut State Police. The case is being prosecuted by Assistant U.S. Attorney Douglas P. Morabito.
Twelve Charged in Dallas as Part of Largest National Medicare Fraud Takedown in HistoryRead the Press Release
DALLAS – Attorney General Loretta E. Lynch and Department of Health and Human Services (HHS) Secretary Sylvia Mathews Burwell announced today an unprecedented nationwide sweep led by the Medicare Fraud Strike Force in 36 federal districts, resulting in criminal and civil charges against 301 individuals, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings. Twenty-three state Medicaid Fraud Control Units also participated in today’s arrests. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) also suspended a number of providers using its suspension authority provided in the Affordable Care Act. This coordinated takedown is the largest in the history of the Medicare Fraud Strike Force, both in terms of the number of defendants charged and loss amount.
“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – It is a serious crime,” said Attorney General Loretta Lynch. “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends. The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.”
“The charges announced today in Dallas are an example of the outstanding investigative work by this district’s Medicare Fraud Strike Force that has been in operation since 2011,” said U.S. Attorney John Parker of the Northern District of Texas. “Medicare and Medicaid fraud not only increases health care costs, but it victimizes the elderly and those who may be vulnerable. This office and its Strike Force will continue to aggressively target, investigate and prosecute anyone trying to defraud these crucial programs.”
Nine of the 12 defendants charged in north Texas were charged in connection with three separate home health care schemes. The other three defendants were charged in another indictment related to hearing-related health care services.
One indictment charges three employees of Elder Home Health Services (ElderCare) with conspiracy to commit health care fraud. Celestine Okwilagwe, aka “Tony Okwilagwe, 48, the owner, and Paul Emordi, 50, a supervisor, allegedly operated ElderCare, a Medicare and Medicaid provider in Garland, Texas, when both were previously excluded from participating in any federal health care benefit program. Adetutu Etti, 58, an administrator for ElderCare, allegedly concealed Okwilagwe and Emordi’s exclusions from Medicare and Medicaid. According to the indictment, from approximately January 2013 through May 2016, Okwilagwe billed Medicare and Medicaid more than $3.4 million for claim reimbursements to which it was not entitled.
In a superseding indictment, the physician owner of Molina Medical Housecall Services, PA, dba U.S. Medical Housecall Services, PA, Hector Molina, 51, of Irving, Texas, and four others are each charged with one count of conspiracy to commit health care fraud. In addition to Dr. Molina, others charged in the conspiracy include Blanca Mata, 47, of Forney, Texas; Lidia Antonio, 56, also of Irving; Ivan Castilleja, 38, of Dallas; and George Richard Rivaux, 43, of San Antonio, Texas. Molina is also charged with 11 counts of health care fraud and one count of aggravated identity theft. Housecall Services employees Mata, Antonio and Rivaux are also each charged with two counts of health care fraud. According to the indictment, from approximately January 2010 through April 2015, Molina and others caused Medicare to be falsely billed $28.6 million for care plan oversight.
In the last home health scheme, physician assistant Shawn Chamberlain of Collin County, Texas, is charged in an information with one count of conspiracy to commit health care fraud. Chamberlain, who was also part-owner of Boomer House Calls (Boomer), hired a physician to apply for a Medicare number to allow him to bill Medicare for physician home visits and to sign false physician certifications for home health care. Chamberlain provided these false physician certifications for home health to Timely Home Health Services, Inc. in Dallas from approximately August 2013 through September 2015. Chamberlain and his co-conspirators caused Medicare to be billed approximately $1.6 million for false certifications, unnecessary home health services and unnecessary physician home visits.
In the remaining indictment, three family members from Garland, Harlan R. Hill, 52; his wife Latecia P. Hill, 50; and her mother, Pearle L. Madere, 71; were each charged with one count of conspiracy to commit health care fraud and 14 counts of health care fraud. Harlan Hill owned and operated Total Senior Ear Care (TSEC); Latecia Hill served as its administrator; and Pearle Madere ran day-to-day operations. TSEC, whose offices were located in Dallas, provided hearing-related services to Medicare beneficiaries living in nursing homes. These hearing services, however, were not provided and were fraudulently billed to Medicare for reimbursement. In fact, this fraudulent business, created by Harlan and Latecia Hill and Pearle Madere caused Medicare to pay TSEC more than $5.1 million for services never rendered or necessary. The indictment also includes a forfeiture allegation that would require Harlan and Latecia Hill, upon conviction, to forfeit their home in Garland, as well as a Mercedes-Benz and a Maserati Quattraporte.
The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations and since its inception in March 2007 has charged over 2,900 defendants who collectively have falsely billed the Medicare program for over $8.9 billion.
Including today’s enforcement actions, nearly 1,200 individuals have been charged in national takedown operations, which have involved more than $3.4 billion in fraudulent billings. Today’s announcement marks the second time that districts outside of Strike Force locations participated in a national takedown, and they accounted for 40 defendants charged in this takedown.
An indictment/information is merely an allegation and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. If convicted, however, each count of conspiracy to commit health care fraud and substantive health care fraud count carries a maximum statutory penalty of 10 years in federal prison and a $250,000 fine.
The cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide, along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois and the Middle District of Florida; and agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.
Assistant U.S. Attorneys Kate Pfeifle and Adrienne Frazior of the Northern District of Texas and Trial Attorney Jason Knutson of the Criminal Division’s Fraud Section are prosecuting the cases filed in the Northern District of Texas.
The court documents for each case will posted online, as they become available, here: https://www.justice.gov/opa/documents-and-resources-june-22-2016-medicare-fraud-strike-force-press-conference.
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Tonawanda Man Pleads Guilty to Production of Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051Buffalo, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today Jason M. Smith, 35, of Tonawanda, NY, pleaded guilty to production of child pornography before Senior U.S. District Judge William M. Skretny. The charge carries a maximum penalty of 60 years in prison, a fine of $250,000, or both.
“This case vividly demonstrates the dangers faced by children in both the real and virtual worlds,” said U.S. Attorney Hochul. “At the same time, let today’s conviction and likely lengthy jail sentence be a warning to sexual predators, whether online or on the street, that this Office will find you and prosecute you to the fullest extent of the law.”
Assistant U.S. Attorney Scott S. Allen, Jr., who is handling the case, stated that on April 11, 2014, the Lancaster Police Department executed a search warrant at Smith’s residence on Byron Avenue in Tonawanda. During the search, officers seized external hard drives. Subsequent examination by the Western New York Regional Forensic Laboratory determined that the defendant was producing child pornography at his residence.
The investigation determined that between 2010 and 2012, Smith coerced Victim 1, who was less than 12 years old, to engage in sexually explicit conduct and produced a visual depiction of the conduct. The defendant was a friend of Victim 1’s father.
In addition, between July 2011 and September 2013, Smith coerced Victim 2, a 15 year old girl he met on MeetMe.com, to engage in sexual intercourse and took pictures of the conduct.
The plea is the culmination of an investigation on the part of Special Agents of the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen, the Lancaster Police Department, under the direction of Chief Gerald J. Gill, Jr., and the Cheektowaga Police Department, under the direction of Chief David Zack.
Sentencing is scheduled for October 19, 2016 at 2:00 p.m. before Judge Skretny.
Texas Man Admits Trying to Coerce a Minor to Have Sex with HimRead the Press Release
PITTSBURGH - A resident of Arlington, Texas, pleaded guilty in federal court to a charge of attempted coercion and enticement of a minor to engage in illegal sexual activity, United States Attorney David J. Hickton announced today.
Ray Wickliffe Howland, 56, of Arlington, Texas, pleaded guilty before Senior United States District Judge Gustave Diamond.
In connection with the guilty plea, on or about June 25, 2015, Howland used facilities and means of interstate and foreign commerce, specifically a computer, an iPad, the Internet and the telephone, to knowingly attempt to persuade, induce, entice, and coerce a minor to engage in sexual activity.
Senior United States District Judge Gustave Diamond scheduled the sentencing for Oct. 19, 2016, at 11 a.m. The law provides for a mandatory minimum sentence of 10 years, a maximum total sentence of life in prison, a fine of $750,000.00, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Jessica Lieber Smolar is prosecuting this case on behalf of the government.
The Office of the Pennsylvania Attorney General and the Federal Bureau of Investigation conducted the investigation that led to the prosecution of Howland.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (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.
Tennessee Couple Indicted for $86,511 Veterans’ Unemployment Compensation Benefit FraudRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a Tennessee couple have been indicted for fraudulently obtaining $86,511 in veterans’ unemployment compensation benefits.
According to United States Attorney Peter Smith, Earl Lafayete Hall, III, age 35, and his wife, Renita Blunt, age 31, both of Arlington, Tennessee, are charged in a Superseding Indictment with mail fraud, money laundering, aggravated identity theft, and conspiracy to commit mail fraud.
According to the Superseding Indictment, with Blunt’s assistance, Hall allegedly applied for veteran’s unemployment compensation benefits under the false name and identity of 8 individuals. The bogus applications were submitted via the internet to the Pennsylvania Department of Labor & Industry in Harrisburg and the Hawaii Department of Labor & Industrial Relations in Honolulu between January 2013 and July 2014.
Hall and Blunt allegedly received the benefits under the Unemployment Compensation for Ex-Service Members Program, commonly known as “The UCX Program,” a federally-funded U.S. Department of Labor program administered by the individual states. Under this federal-state partnership, the states pay out unemployment insurance benefits to the veterans based on the claimed residence of the veteran, and are subsequently reimbursed by branches of the military. Benefits are based upon the military wages and pay grade of the serviceman at the time of his or her separation from military service. There is no payroll deduction for UCX unemployment insurance protection.
The Indictment alleges that Hall and Blunt caused 12 Pennsylvania benefit checks to be mailed to two addresses in western Pennsylvania (Sarver and New Kensington, Pa) and to another address in Joliet, Illinois. The Indictment also alleges that $43,224 of the fraudulently obtained benefits was deposited into a bank account Hall controlled in Illinois, and that $4,900 in cash was subsequently removed from the account via multiple ATM transactions. The cash withdrawals form the basis of the money laundering counts in the Indictment.
Hall was previously indicted by a Middle District of PA grand jury on March 2, 2016 on charges involving the same scheme. Following his arrest in Tennessee on March 7, 2016, and following an appearance in Harrisburg before US Magistrate Court Judge Martin C. Carlson on March 15, 2016, Hall was released to home detention. Today’s Superseding Indictment adds Blunt as a codefendant and eight new charges (six counts of Aggravated Identity Theft and one count of Conspiracy to commit Mail Fraud). No hearing date has yet been set for either Hall or Blunt on the charges.
The investigation is being conducted by the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering & Fraud Investigations, U.S. Defense Criminal Investigative Service, U.S. Postal Inspection Service with assistance from Pennsylvania Department of Labor and Industry, Internal Audits Division, Pennsylvania Department of Labor and Industry, Office of Unemployment Compensation Benefits and Policy, and the Pennsylvania Department of the Treasury, Office of Unemployment Compensation Disbursements. The case is being prosecuted by Assistant U.S. Attorney Kim Douglas Daniel.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty for each count under federal law is 20 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Tampa Man Pleads Guilty to Role in Stolen Identity Tax Refund SchemeRead the Press Release
Tampa, Florida – United States Attorney A. Lee Bentley, III announces that Cedric Clark (35, Tampa) has pleaded guilty to one count of mail fraud, one count of conspiracy, and one count of aggravated identity theft. He faces a maximum penalty of 20 years in federal prison on the mail fraud count, up to 5 years’ imprisonment on the conspiracy count, and a mandatory consecutive term of 2 years for the aggravated identity theft charge.
According to the plea agreement, between October 2010 and June 2013, Clark engaged in a fraud scheme with individuals who had obtained the Personal Identification Information (PII) of more than 1,158 individuals and then had filed false and fraudulent income tax returns in their names, seeking large tax refunds. Clark controlled a post office box where many of the refund checks were mailed. He also controlled numerous bank accounts at various financial institutions where the IRS had wired the tax refunds requested in those fraudulent tax returns. The IRS paid a total of $637,621.62 to accounts that Clark controlled. The scheme involved the filing of many more returns that the IRS did not accept.
This case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service-Criminal Investigation, and the U.S. Postal Inspection Service. It is being prosecuted by Assistant United States Attorney Jay L. Hoffer.
Syracuse Area Physician to Pay Civil Penalty for Violating the Controlled Substances ActRead the Press Release
ALBANY, NEW YORK – United States Attorney Richard S. Hartunian announced that his office reached a $30,000 civil settlement with Dr. Anthony A. Ascioti, a Fayetteville, New York anesthesiologist. The settlement was in connection with violations of the Controlled Substances Act. Dr. Ascioti’s Drug Enforcement Administration (DEA) number, which enabled him to prescribe controlled substances, has expired and he has not sought to renew it.
In 2015, the New York State Police (NYSP) and the New York State Bureau of Narcotic Enforcement (BNE) received information that an individual was receiving significant amounts of Adderall[1] using prescriptions signed by Dr. Ascioti on prescription pads from the Anesthesiology Department at St. Joseph’s Hospital. A subsequent investigation revealed that the individual to whom the prescriptions were given was not a patient of St. Joseph’s Hospital and that Dr. Ascioti was not working at that hospital at the time. Dr. Ascioti had also previously worked in the Anesthesiology Department at Auburn Memorial Hospital, but he had not worked there for six years. The individual receiving the prescriptions was also not a patient at Auburn Memorial Hospital. Moreover, the Adderall prescriptions were not related to anesthesiology services.
The investigation revealed that from January 20, 2012 to October 24, 2014, Dr. Ascioti issued 38 controlled substance prescriptions for the individual which were outside the scope of his usual course of professional practice. In addition, Dr. Ascioti failed to maintain records or a patient file for the individual in connection with these prescriptions.
Pursuant to federal regulations, a prescription for a controlled substance to be effective must be issued for a legitimate medical purpose by a practitioner acting in the usual course of his or her professional practice. When Dr. Ascioti issued these prescriptions he did not meet these requirements since he did not prescribe this individual Adderall in connection with his practice as an anesthesiologist at either St. Joseph’s Hospital or Auburn Memorial Hospital.
The Controlled Substances Act was enacted to ensure that controlled substances are properly regulated and to help prevent drug diversion. Prescription drug abuse is a significant nationwide issue. According to U.S. Attorney Hartunian, his office will aggressively pursue those who engage in drug diversion, especially if they are healthcare providers. “It simply is unacceptable for medical professionals to act irresponsibly when handling controlled substances. The potential for these substances to end up in the wrong hands is something we are not willing to risk, and we will use whatever tools are available to prevent this from happening.”
The case was investigated by the NYSP, BNE and the DEA’s Diversion Unit in Syracuse, New York. The United States was represented by Assistant U.S. Attorney Thomas Spina Jr.
[1] Adderall is commonly prescribed to treat attention deficit hyperactivity disorder and narcolepsy. It is also used to enhance cognitive functions, promote athletic performance, to produce feelings of euphoria and as an aphrodisiac.
Steuben Man Pleads Guilty to Possession of a Firearm by a FelonRead the Press Release
Contact: F. Todd Lowell
Assistant United States Attorney
Tel: (207) 945-0373Bangor, Maine: United States Attorney Thomas E. Delahanty II announced that Aaron C. Robinson, 51, of Steuben, Maine pleaded guilty today in U.S. District Court to being a felon in possession of a firearm.
Court records show that on November 16, 2015, the Maine Warden Service (MWS) found the defendant with a Savage .308 rifle hunting dear with bait from a tree stand in Steuben. The defendant had prior Maine state court felony convictions for terrorizing, violations of conditions of release, possession of a firearm by a felon, burglary and aggravated criminal mischief.
Robinson faces up to 10 years in prison and a $250,000 fine. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The investigation was conducted by the MWS and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Stamford Woman Charged with Operating Health Care Fraud SchemeRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that ELENA ILIZAROV, 43, of Stamford, was arrested yesterday on a federal criminal complaint alleging that she used stolen identity information to operate a health care fraud scheme. ILIZAROV owned and operated Advanced Dentistry, a dental practice located in Stamford.
ILIZAROV appeared before U.S. Magistrate Judge Sarah A.L. Merriam in New Haven and was released on a $500,000 bond, with the requirement that ILIZAROV wear a GPS monitoring device.
The complaint alleges that, beginning in approximately 2005, ILIZAROV fraudulently obtained the personal identifying information of a retired dentist and used that information to bill insurance companies through Advanced Dentistry for dental care allegedly performed by the retired dentist.
The alleged scheme resulted in losses of more than $1.1 million to the various health insurance companies.
The charge of wire fraud carries a maximum term of imprisonment of 20 years.
U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation Division and U.S. Department of Health and Human Services – Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorneys Sarala V. Nagala and David J. Sheldon.
“This alleged scheme victimized a retired dentist who had his identity stolen, as well as multiple insurance companies that paid more than a million dollars in fraudulent claims,” said U.S. Attorney Daly. “Health care insurance fraud schemes ultimately increase health care costs for all of us, and the U.S. Attorney’s Office and our federal and state investigative partners are committed to uncovering all of them to ensure that justice is done.”
U.S. Attorney Daly noted that this announcement is made as part of a national health care fraud takedown.
Earlier today, Attorney General Loretta E. Lynch and Department of Health and Human Services (HHS) Secretary Sylvia Mathews Burwell announced an unprecedented nationwide sweep led by the Medicare Fraud Strike Force in 36 federal districts, resulting in criminal and civil charges against 300 individuals, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings. Twenty-two state Medicaid Fraud Control Units also participated in today’s arrests. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) is suspending payment to a number of providers using its suspension authority provided in the Affordable Care Act. This coordinated takedown is the largest in history, both in terms of the number of defendants charged and loss amount.
“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – It is a serious crime,” said Attorney General Loretta Lynch. “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends. The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.”
The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations and since its inception in March 2007 has charged over 2,900 defendants who collectively have falsely billed the Medicare program for over $8.9 billion.
Including today’s enforcement actions, nearly 1,200 individuals have been charged in national takedown operations, which have involved more than $3.4 billion in fraudulent billings. Today’s announcement marks the second time that districts outside of Strike Force locations – including the District of Connecticut – participated in a national takedown, and they accounted for 82 defendants charged in this takedown.
U.S. Attorney Daly encourages individuals who suspect health care fraud to report it by calling the Health Care Fraud Task Force at (203) 777-6311 or 1-800-HHS-TIPS.
Southport Man Sentenced to Prison for Failing to Pay Taxes on Money He Stole from BenefactorRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that ORVAL FURLONG, 73, of Southport, was sentenced today by U.S. District Judge Jeffrey A. Meyer in New Haven to five months of imprisonment, followed by one year of supervised release, for failing to pay taxes on money he stole from a benefactor. FURLONG also was ordered to perform 200 hours of community service.
According to court documents and statements made in court, FURLONG was a life-long friend of a wealthy benefactor and, over the years, the benefactor paid some of FURLONG’s debts. During the last years of the benefactor’s life, FURLONG hired home health aides to care for the benefactor. During this time, the benefactor provided FURLONG with a stipend of approximately $8,000 to $10,000 per month. The benefactor also employed the services of an attorney who acted as the benefactor’s power of attorney and oversaw the benefactor’s finances. FURLONG provided the attorney with a detailed itemization of the hours worked by the home health aides, the hourly rates for their services, and the total funds needed to pay them for the services provided. The attorney then issued FURLONG checks from one of the benefactor’s bank accounts to pay the health aides.
From at least 2009 to 2011, FURLONG routinely inflated the applicable hourly rate paid to the home health aides. FURLONG then paid the home health aides in cash or by check in an amount significantly lower than FURLONG had represented to the attorney. FURLONG kept the difference and used the funds for his personal expenditures.
On February 22, 2016, FURLONG pleaded guilty to one count of tax evasion and admitted that he failed to report more than $500,000 in stolen income on his 2009 through 2011 federal tax returns.
FURLONG has paid $105,693 in back taxes.
This case was investigated by the Internal Revenue Service – Criminal Investigation Division and was prosecuted by Assistant U.S. Attorney Christopher W. Schmeisser.
South Williamsport Woman Charged with Embezzling Money from Post OfficeRead the Press Release
WILLIAMSPORT – The United States Attorney’s Office for the Middle District of Pennsylvania announced the filing of a Criminal Information yesterday charging Lori Regel-Childs with misappropriation of funds from the U.S. Post Office in South Williamsport, Pennsylvania.
According U.S. Attorney Peter Smith, Regel-Childs, age 52, allegedly took approximately $11,611 from the South Williamsport Post Office while working there as the lead sales and service associate from October 2014 through December 2015. Regel-Childs allegedly took the proceeds of cash postage stamp sales, funds from her cash drawer, and money from the unit cash reserve at the Post Office. She also removed cash from her assigned cash drawer and the cash reserve to pay her personal bills and expenses. Regel-Childs is a resident of South Williamsport.
Under the terms of a plea agreement filed with the criminal information, Regel-Childs has agreed to enter a guilty plea and pay restitution. The plea agreement is subject to the approval of the court.
This matter was investigated by the Office of Inspector General, United States Postal Service. Assistant U.S. Attorney George J. Rocktashel has been assigned to the prosecution of this matter.
Criminal informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is 10 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Shippensburg Man Sentenced to Federal Prison on Heroin Trafficking ChargesRead the Press Release
HARRISBURG –The United States Attorney’s Office for the Middle District of Pennsylvania announced that Jonathan Santana, age 35, of Shippensburg man was sentenced today to 14 years imprisonment by U.S. District Court Judge Sylvia H. Rambo in Harrisburg.
According to United States Attorney Peter Smith, Santana pleaded guilty on January 13, 2016 to distributing more than 100 grams of heroin and criminal conspiracy. Co-defendants Angelo Harrison and Dorothy Washington, also of Shippensburg, have also pled guilty in federal court before Judge Rambo and are both awaiting sentencing.
The investigation was conducted by the Drug Enforcement Administration Offices in Harrisburg and Hagerstown, Maryland, the Pennsylvania State Police, and the Cumberland and Franklin County Drug Task Forces. The case was prosecuted by Assistant United States Attorney William A. Behe.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the heroin initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines. The Judge is required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs.
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Seven Charged in Puerto Rico as part of Largest National Medicare Fraud Takedown in HistoryRead the Press Release
SAN JUAN, Puerto Rico – Attorney General Loretta E. Lynch and Department of Health and Human Services (HHS) Secretary Sylvia Mathews Burwell announced today an unprecedented nationwide sweep led by the Medicare Fraud Strike Force in 36 federal districts, resulting in criminal and civil charges against 301 individuals, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings. Twenty-three state Medicaid Fraud Control Units also participated in today’s arrests. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) is suspending payment to a number of providers using its suspension authority provided in the Affordable Care Act. This coordinated takedown is the largest in history, both in terms of the number of defendants charged and loss amount.
“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – It is a serious crime,” said Attorney General Loretta Lynch. “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends. The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.”
“The defendants charged today received moneys from services that were not rendered or care that wasn’t needed,” said United States Attorney, Rosa Emilia Rodríguez-Vélez. “Our office will continue to work with our federal, state and local law enforcement partners and focus on preventing wrongdoing and prosecuting those whose criminal activity drives up medical costs and jeopardizes a system that our citizens trust with their lives.”
On June 15, 2016, a Federal grand jury returned an indictment charging Arlene Carlo-Montalvo with 48 counts of theft or embezzlement in connection with health care, 48 counts of wire fraud, two counts of misuse of social security number, and two counts of aggravated identity theft.
The charges stem from Carlo-Montalvo’s role in a scheme or artifice to defraud Medical Card System Inc., also known as MCS, in the amount of $219,508.56, by means of fraudulent pretenses and using social security numbers assigned to other persons. Carlo-Montalvo, as an employee of MCS, created a fictitious vendor and would manipulate the system to submit false invoices for services not rendered. The agencies in charge of the investigation are Social Security Administration- Office of Inspector General and Homeland Security Investigations.
Another six individuals are facing civil actions for fraudulently obtaining the benefits with the submission of false information and with salaries that exceeded $50,000.00. Specifically, during 2015, the individuals fraudulently enrolled in the Medicaid health care benefit program, by providing false statements and representations regarding eligibility criteria, such as income, among others. By misrepresenting core eligibility requirements during the enrollment process they were able to fraudulently obtain health care services for which they would otherwise be ineligible, and causing several unique premium payments to be submitted as false claims.
The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations and since its inception in March 2007 has charged over 2,900 defendants who collectively have falsely billed the Medicare program for over $8.9 billion.
Including today’s enforcement actions, nearly 1,200 individuals have been charged in national takedown operations, which have involved more than $3.4 billion in fraudulent billings. Today’s announcement marks the second time that districts outside of Strike Force locations participated in a national takedown, and they accounted for 82 defendants charged in this takedown.
The cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide, along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois and the Middle District of Florida; and agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.
A complaint or indictment is merely a charge, and all defendants are presumed innocent unless and until proven guilty.
The court documents for each case will posted online, as they become available, here: https://www.justice.gov/opa/documents-and-resources-june-22-2016-medicare-fraud-strike-force-press-conference.
Senior Auction Official at Beverly Hills Auction House Sentenced to Prison for Wildlife TraffickingRead the Press Release
Joseph Chait, 38, of Beverly Hills, California, the senior auction administrator of I.M. Chait Gallery, located in Beverly Hills, was sentenced today to one year and one day in prison and a $10,000 fine for conspiring to smuggle wildlife products made from rhinoceros horn, elephant ivory and coral with a market value of at least $1 million, announced Assistant Attorney General John C. Cruden for the Department of Justice’s Environment and Natural Resources Division, U.S. Attorney Preet Bharara for the Southern District of New York and Director Dan Ashe for the U.S. Fish and Wildlife Service (FWS). On March 9, Chait pleaded guilty to a two-count Information before U.S. District Judge J. Paul Oetken for the Southern District of New York, who imposed today’s sentence.
“Conspiring in the trafficking endangered wildlife is a serious crime, and those involved in the auction industry should take note that facilitating this trade can result in prison,” said Assistant Attorney General Cruden. “The African Elephant, the rhinoceros, and coral are all deeply threatened species that have undergone dramatic losses in recent decades as the trade in them has become highly lucrative. We must stop this trade, and we will vigorously investigate and prosecute those engaged in it.”
“By illegally trafficking in wildlife, including rhinoceros horns, Joseph Chait and his co-conspirators have fueled the illegal trade in endangered wildlife,” said U.S. Attorney Bharara. “Chait’s conduct, a federal crime for which he will now spend time in prison, threatened the already precarious existence of certain endangered species of animals.”
“As this investigation by U.S. Fish and Wildlife Service Special Agents demonstrates, United States citizens and businesses continue to be involved in international wildlife trafficking – facilitating and magnifying consumer demand for rhino horn, elephant ivory and other illegal products that is driving the slaughter of imperiled species in the wild,” said Director Ashe. “The stiff sentence and fines imposed today on Joseph Chait for his crimes serves notice to those engaged in similar criminal activity that their day of reckoning in court is coming.”
According to allegations contained in the Information and statements made in court filings and proceedings:
Chait and his co-conspirators engaged in illegal trafficking of wildlife with a market value of at least $1 million. Chait personally falsified customs forms by stating that rhinoceros horn and elephant ivory items were made of bone, wood or plastic. For example, during Asia Week in New York City, New York, in or about March 2011, Chait was approached by an undercover special agent with FWS about the potential sale of a carving of Guanyin, an East Asian spiritual figure made from rhinoceros horn (the Rhino Carving). Despite knowing that it was not a genuine antique, Chait and his co-conspirators accepted the Rhino Carving for consignment, advertised the sale to foreign clients in China and put the Rhino Carving on the cover of I.M. Chait Gallery’s catalogue in connection with an auction of Asian art and antiques. After the Rhino Carving sold at auction for $230,000 to another undercover agent, Chait offered to make a false document for the buyer to help the buyer smuggle the item out of the country. The fake invoice falsely stated that the item cost $108.75 and was made of plastic.
Chait also sold rhinoceros ivory carvings to another customer and provided those carvings to that customer’s courier, even after learning that the customer had been arrested in China for smuggling ivory purchased from Chait’s auction house.
In addition to falsifying customs forms by stating that rhinoceros horn and elephant ivory items were made of bone, wood or plastic, Chait and his co-conspirators conducted their wildlife smuggling using a variety of methods:
- Wildlife items were shipped to or picked up by third party shippers, who then re-shipped the items out of the country without the required declaration or permits.
- Members of the conspiracy provided packing materials to foreign wildlife buyers to assist them in hand carrying the wildlife out of the country.
- Foreign wildlife buyers were sold protected wildlife items without being assessed a state sales tax if they showed a foreign passport and itinerary for an international flight as proof the item would be leaving the country.
- Protected wildlife was smuggled into the United States without declaration or permits and then sold at auction by members of the conspiracy.
As a result of a recent Presidential Executive Order, trade in protected wildlife such as rhinoceros horn and elephant ivory has been significantly restricted in the last two years, except for those instances where sellers can prove that the item is a genuine antique that is more than 100 years old.
Rhinoceros are an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth. They have no known predators other than humans. All species of rhinoceros are protected under U.S. and international law. Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), a treaty signed by over 170 countries around the world to protect fish, wildlife and plants that are or may become imperiled due to the demands of international markets.
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In addition to the term of prison, Chait was sentenced to three years of supervised release and was ordered to pay a $10,000 fine.
Assistant Attorney General Cruden and U.S. Attorney Bharara praised the efforts of FWS for its outstanding work in this investigation.
This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit and the Environmental Crimes Section of the Department of Justice. Assistant U.S. Attorneys Jennifer Gachiri and Elizabeth Hanft and Senior Litigation Counsel Richard A. Udell with the Environmental Crimes Section of the Department of Justice are in charge of the prosecution.
Senior Auction Official at Beverly Hills Auction House Sentenced to Prison for Wildlife TraffickingRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, and John C. Cruden, the Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice, announced that JOSEPH CHAIT, the senior auction administrator of I.M. Chait Gallery, located in Beverly Hills, California, was sentenced today to one year and one day in prison and a $10,000 fine for conspiring to smuggle wildlife products made from rhinoceros horn, elephant ivory, and coral with a market value of at least $1 million. On March 9, 2016, CHAIT pled guilty to a two-count Information before U.S. District Judge J. Paul Oetken, who imposed today’s sentence.
Manhattan U.S. Attorney Preet Bharara stated: “By illegally trafficking in wildlife, including rhinoceros horns, Joseph Chait and his co-conspirators have fueled the illegal trade in endangered wildlife. Chait’s conduct, a federal crime for which he will now spend time in prison, threatened the already precarious existence of certain endangered species of animals.”
Assistant Attorney General John C. Cruden stated: “Conspiring in the trafficking of endangered wildlife is a serious crime, and those involved in the auction industry should take note that facilitating this trade can result in prison. The African Elephant, the rhinoceros, and coral are all deeply threatened species that have undergone dramatic losses in recent decades as the trade in them has become highly lucrative. We must stop this trade, and we will vigorously investigate and prosecute those engaged in it.”
According to allegations contained in the Information and statements made in court filings and proceedings:
CHAIT and his co-conspirators engaged in illegal trafficking of wildlife with a market value of at least $1 million. CHAIT personally falsified customs forms by stating that rhinoceros horn and elephant ivory items were made of bone, wood, or plastic. For example, during Asia Week in New York City in or about March 2011, CHAIT was approached by an undercover special agent with the U.S. Fish & Wildlife Service about the potential sale of a carving of Guanyin, an East Asian spiritual figure, made from rhinoceros horn (the “Rhino Carving”). Despite knowing that it was not a genuine antique, CHAIT and his co-conspirators accepted the Rhino Carving for consignment, advertised the sale to foreign clients in China, and put the Rhino Carving on the cover of I.M. Chait Gallery’s catalogue in connection with an auction of Asian art and antiques. After the Rhino Carving sold at auction for $230,000 to another undercover agent, CHAIT offered to make a false document for the buyer to help the buyer smuggle the item out of the country. The fake invoice falsely stated that the item cost $108.75 and was made of plastic.
CHAIT also sold rhinoceros ivory carvings to another customer, and provided those carvings to that customer’s courier, even after learning that the customer had been arrested in China for smuggling ivory purchased from CHAIT’s auction house.
In addition to falsifying customs forms by stating that rhinoceros horn and elephant ivory items were made of bone, wood, or plastic, CHAIT and his co-conspirators conducted their wildlife smuggling using a variety of methods:
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Wildlife items were shipped to or picked up by third party shippers, who then re-shipped the items out of the country without the required declaration or permits.
-
Members of the conspiracy provided packing materials to foreign wildlife buyers to assist them in hand carrying the wildlife out of the country.
-
Foreign wildlife buyers were sold protected wildlife items without being assessed a state sales tax if they showed a foreign passport and itinerary for an international flight as proof the item would be leaving the country.
-
Protected wildlife was smuggled into the United States without declaration or permits, and then sold at auction by members of the conspiracy.
As a result of a recent Presidential Executive Order, trade in protected wildlife such as rhinoceros horn and elephant ivory has been significantly restricted in the last two years, except for those instances where sellers can prove that the item is a genuine antique that is more than 100 years old.
Rhinoceros are an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth. They have no known predators other than humans. All species of rhinoceros are protected under U.S. and international law. Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (“CITES”), a treaty signed by over 170 countries around the world to protect fish, wildlife, and plants that are or may become imperiled due to the demands of international markets.
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In addition to the term of prison, CHAIT, 38, of Beverly Hills, California, was sentenced to three years of supervised release and was ordered to pay a $10,000 fine.
Mr. Bharara praised the efforts of the U.S. Fish and Wildlife Service for its outstanding work in this investigation.
This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit and the Environmental Crimes Section of the Department of Justice. Assistant United States Attorneys Jennifer Gachiri and Elizabeth Hanft, and Senior Litigation Counsel Richard A. Udell with the Environmental Crimes Section of the Department of Justice, are in charge of the prosecution.
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Prior Felon from Valencia County Pleads Guilty to Violating Federal Firearms LawsRead the Press Release
ALBUQUERQUE – Johnny Sanchez, 39, of Los Lunas, N.M., pled guilty today in federal court in Albuquerque, N.M., to being a felon in possession of a firearm. Under the terms of his plea agreement, Sanchez will be sentenced to 72 months in federal prison followed by a term of supervised release to be determined by the court.
Sanchez was arrested on Sept. 9, 2014, on a federal indictment charging him with being a felon in possession of a firearm and possession of a stolen firearm. The indictment alleged that the crimes took place on May 29, 2013, in Valencia County, N.M.
During today’s proceedings, Sanchez pled guilty to the felon in possession of a firearm charge. In entering the guilty plea, Sanchez admitted that he was prohibited from possessing firearms on May 29, 2013, because of his previous felony convictions for aggravated battery with a deadly weapon and being a felon in possession of a firearm. Sanchez remains in custody pending a sentencing hearing which has yet to be scheduled.
This case was investigated by the Albuquerque office of the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Los Lunas Police Department with assistance from the 13th Judicial District Attorney’s Office. Assistant U.S. Attorney Rumaldo R. Armijo is prosecuting the case.
Philadelphia Man Indicted on Gun ChargeRead the Press Release
Vernon Jones, 24, of Philadelphia, Pennsylvania was charged today by Indictment with possession of a firearm by a convicted felon, announced United States Attorney Zane David Memeger. According to the indictment, on or about April 12, 2016, in Philadelphia, Jones possessed a Beretta, Model BU9 Nano, 9mm pistol, and empty magazine that fit the pistol, and 14 spent 9mm cartridge casings, which had been ejected immediately outside of the residence from where the pistol was recovered.
If convicted the defendant faces a mandatory minimum sentence of 15 years in prison.
The case was investigated by the Philadelphia Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives and is being prosecuted by Assistant United States Attorney Yvonne Osirim.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Omaha Man Sentenced to Five Years for Child PornographyRead the Press Release
Andrew Soverns, 32, was sentenced in federal court for receiving child pornography. The Honorable Joseph F. Bataillon imposed a sentence of sixty (60) months’ imprisonment. There is no parole in the federal system. After his release from prison, Soverns will serve an additional five years of supervised release. Soverns was further ordered to pay $2,000 in restitution to each of two victims depicted in his collection of child pornography.
On August 19, 2015, a federal search warrant was served on Soverns’s residence in Omaha. Images of child pornography were located on three devices in the home. The children depicted in the images ranged from pre-teen to early teens. A total of 41 videos and 46 single images of child pornography were recovered.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Omaha FBI's Cyber Crime Task Force (CCTF).
North Carolina Man Charged with Possession with Intent to Distribute HeroinRead the Press Release
HARRISBURG- The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a federal Grand Jury in Harrisburg has returned an indictment charging Alshaqah Tariq Powell, age 43, with possession with intent to distribute heroin.
According to the United States Attorney Peter Smith, Powell, a resident of North Carolina, was traveling to Dauphin County on Interstate 81 when he was involved in a traffic stop leading to his arrest and discovery of the alleged heroin on November 3, 2015.
This matter was investigated by the Pennsylvania State Police and the Drug Enforcement Agency. Prosecution has been assigned to Assistant U.S. Attorney Chelsea Schinnour.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the heroin initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is forty years, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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New York City Pharmacy Owner Arrested for $8.5 Million Fraud as Part of Largest National Medicare Fraud Takedown in HistoryRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Diego Rodriguez, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Scott J. Lampert, the Special Agent-in-Charge of the New York Office of the Department of Health and Human Services, announced today that SAJID JAVED was charged with participating in a health care fraud scheme that used nine pharmacies in Brooklyn and Queens, New York, through which JAVED submitted more than $8.5 million in fraudulent claims to Medicaid and Medicare. JAVED’s arrest is part of an unprecedented nationwide sweep led by the Medicare Fraud Strike Force, resulting in criminal and civil charges against 301 individuals, including 61 doctors, nurses, or other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings. Twenty-three state Medicaid Fraud Control Units also participated in today’s arrests. In addition, the HHS Centers for Medicare & Medicaid Services (“CMS”) also suspended a number of providers using its suspension authority provided in the Affordable Care Act. This coordinated takedown is the largest in the history of the Medicare Fraud Strike Force, both in terms of the number of defendants charged and loss amount.
JAVED was arrested earlier today and is expected to be presented in Manhattan federal court later this afternoon.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, Sajid Javed induced others to forego their prescription medications for a kickback, and then fraudulently billed Medicare and Medicaid more than $8 million for the drugs that were never actually dispensed. This alleged scheme not only put patients at risk, it also contributed to the multibillion-dollar pillaging of federally funded public health care subsidies.”
FBI Assistant Director-in-Charge Diego Rodriguez said: “These alleged criminals arrested around the country today and here in New York City are stealing money meant to help people seeking medical assistance. It’s not a visible theft in public view, but the victims of the crime suffer greatly when they can’t get the assistance they need. We are asking anyone who sees this sort of crime and fraud taking place to be vigilant, and report it to us at 1-800-CALL-FBI.”
HHS-OIG Special Agent in Charge Scott J. Lampert said: “Prescription drug scams, such as the one alleged in this case, work to undermine our nation's health care system. Today’s arrests coordinated with our law enforcement partners serve as a stern warning to those who attempt to plunder government health programs meant to care for our most vulnerable citizens.”
As alleged in the Complaint and in other documents filed in Manhattan federal court[1]:
While owning and operating nine different pharmacies located in Brooklyn and Queens, SAJID JAVED conducted a multimillion-dollar scheme to defraud Medicare and Medicaid programs by seeking reimbursement for prescription drugs that were not distributed to customers. Specifically, from January 2013 through December 2014, JAVED obtained more than $8.5 million in reimbursements from Medicare and Medicaid for prescription drugs that his pharmacies never actually dispensed. JAVED defrauded Medicare and Medicaid into providing him with these reimbursements by obtaining prescriptions from other individuals, who were willing to forego delivery of the medications in exchange for a share of the reimbursed proceeds, in the form of kickbacks. JAVED offered to pay, and did actually pay, kickbacks in furtherance of this scheme.
Including today’s enforcement actions, nearly 1,200 individuals have been charged in national takedown operations, which have involved more than $3.4 billion in fraudulent billings. Today’s announcement marks the second time that districts outside Strike Force locations participated in a national takedown, and they accounted for 82 defendants charged in this takedown.
The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (“HEAT”), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations and since its inception in March 2007 has charged over 2,900 defendants who collectively have falsely billed the Medicare program for over $8.9 billion.
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JAVED, 45, of Fresh Meadows, Queens, is charged with one count of health care fraud, which carries a maximum sentence of 10 years in prison, and one count of illegal remuneration in connection with a federal health care program, which carries a maximum sentence of five years in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Bharara praised the investigative work of the FBI and HHS-OIG.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorneys Christopher DiMase and Sarah Paul are in charge of the prosecution.
The charges in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint, and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
New Jersey Brothers Sentenced to Prison for Shipping More Than $1.9 Million Worth of Stolen CarsRead the Press Release
CAMDEN, N.J. – Two New Jersey men were each sentenced to more than 16 years in prison for their roles in a large-scale conspiracy to ship stolen luxury cars to Hong Kong and elsewhere, U.S. Attorney Paul J. Fishman announced.
Andrew Clarke, 43 of Irvington, New Jersey, and Llewellyn Clarke, 42 of North Plainfield, New Jersey, were sentenced to 300 and 195 months in prison, respectively. Both were previously convicted on all four counts of a superseding indictment charging them each with one count of conspiracy to transport stolen motor vehicles and three counts of transportation of stolen motor vehicles in interstate and foreign commerce. They were convicted following a three-week trial before U.S. District Judge Robert B. Kugler, who imposed the sentences today in Camden federal court.
According to documents filed in in this case and evidence presented at trial:
The stolen car exportation ring was investigated by a multi-agency task force led by Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). The investigation revealed that the Clarkes were purchasing stolen luxury cars from thieves operating in northern New Jersey and New York.
The Clarke brothers then recruited other conspirators to “re-tag” those cars, or have fraudulent vehicle identification numbers placed on the cars to mask the fact that they were stolen, and then had false title documents produced for those cars in New Jersey and Georgia. After the fake documents were created, the Clarkes shipped several of those stolen cars, valued between $1.9 and $2.1 million, from New Jersey to Hong Kong, while other cars were shipped to Georgia, Maryland and elsewhere. Once overseas or out-of-state, the stolen cars were then re-sold, some to unsuspecting buyers who later learned that their vehicles were in fact stolen.
In addition to the prison terms, Judge Kugler sentenced both defendants to three years of supervised release.
U.S. Attorney Fishman credited special agents of ICE HSI, under the leadership of Executive Associate Director Peter Edge and Acting Special Agent in Charge Terence S. Opiola, and the N.J. State Police, under the direction of Superintendent Col. Rick Fuentes, for the investigation leading to today’s sentences. He also thanked U.S. Customs and Border Protection; the Waterfront Commission of New York Harbor; Essex County Prosecutor Carolyn Murray, Middlesex County Prosecutor Andrew C. Carey, Hudson County Prosecutor Esther Suarez, and Union County Acting Prosecutor Grace H. Park, the Essex and Hudson County Sheriff’s Departments, the Newark Police Department, the U.S. Coast Guard Investigative Service, the Port Authority of New York and New Jersey, the New Jersey Motor Vehicle Commission, the Georgia Department of Revenue, and the Maryland State Police for their roles.
The government is represented by Assistant U.S. Attorney José R. Almonte and James M. Donnelly of the U.S. Attorney’s Office Criminal Division in Newark
Defense counsel:
Andrew Clarke: Brian O’Malley Esq., Haddon Heights, New Jersey
Llewellyn Clarke: Paul Sarmousakis Esq., Avalon, New Jersey
National Health Care Fraud Takedown Results in Charges against 301 Individuals for Approximately $900 Million in False BillingRead the Press Release
Most Defendants Charged and Largest Alleged Loss Amount in Strike Force History
Attorney General Loretta E. Lynch and Department of Health and Human Services (HHS) Secretary Sylvia Mathews Burwell announced today an unprecedented nationwide sweep led by the Medicare Fraud Strike Force in 36 federal districts, resulting in criminal and civil charges against 301 individuals, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings. Twenty-three state Medicaid Fraud Control Units also participated in today’s arrests. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) is suspending payment to a number of providers using its suspension authority provided in the Affordable Care Act. This coordinated takedown is the largest in history, both in terms of the number of defendants charged and loss amount.
Attorney General Lynch and Secretary Burwell were joined in the announcement by Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, FBI Associate Deputy Director David Bowdich, Inspector General Daniel Levinson of the HHS Office of Inspector General (OIG), Acting Director Dermot O’Reilly of the Defense Criminal Investigative Service (DCIS), and Deputy Administrator and Director of CMS Center for Program Integrity Shantanu Agrawal M.D.
The defendants announced today are charged with various health care fraud-related crimes, including conspiracy to commit health care fraud, violations of the anti-kickback statutes, money laundering and aggravated identity theft. The charges are based on a variety of alleged fraud schemes involving various medical treatments and services, including home health care, psychotherapy, physical and occupational therapy, durable medical equipment (DME) and prescription drugs. More than 60 of the defendants arrested are charged with fraud related to the Medicare prescription drug benefit program known as Part D, which is the fastest-growing component of the Medicare program overall.
“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – It is a serious crime,” said Attorney General Lynch. “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment. They target real people – many of them in need of significant medical care. They promise effective cures and therapies, but they provide none. Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends. The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.”
“Millions of seniors depend on Medicare for essential health coverage, and our action shows that this administration remains committed to cracking down on individuals who try to defraud the program,” said Secretary Burwell. “We are continuing to put new tools and additional resources to work, including $350 million from the Affordable Care Act, for health care fraud prevention and enforcement efforts. Thanks to the hard work of the Medicare Fraud Strike Force, we are making progress in addressing and deterring fraud and delivering results to help ensure Medicare remains strong for years to come.”
According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare and Medicaid for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, Medicare beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed. Collectively, the doctors, nurses, licensed medical professionals, health care company owners and others charged are accused of submitting a total of approximately $900 million in fraudulent billing.
“The Medicare Fraud Strike Force is a model of 21st-Century data-driven law enforcement, and it has had a remarkable impact on health care fraud across the country,” said Assistant Attorney General Caldwell. “As the cases announced today demonstrate, the Strike Force’s strategic approach keeps us a step ahead of emerging fraud trends, including drug diversion, and fraud involving compounded medications and hospice care.”
“These criminals target the most vulnerable in our society by taking money away from the care of the elderly, children and disabled,” said Associate Deputy Director Bowdich. “The FBI is committed to working with our partners and the public to stop fraud and ensure that healthcare dollars are used to help the sick, and not line the pockets of criminals.”
“While it is impossible to accurately pinpoint the true cost of fraud in federal health care programs, fraud is a significant threat to the programs’ stability and endangers access to health care services for millions of Americans,” said Inspector General Levinson. “As members of the joint Strike Force, OIG will continue to play a vital role in tracking down these criminals and seeing that justice is done.”
“DCIS, in partnership with our fellow federal investigative agencies, will continue to uncompromisingly investigate and bring to justice the people who perpetrate these criminal acts,” said Acting Director O’Reilly. “Their actions threaten to cripple our vital national health care industry, and place our citizenry at risk. We will remain vigilant.”
“Taxpayers and Congress provided CMS with resources to adopt powerful monitoring systems that fight fraud, safeguard program dollars, and protect Medicare and Medicaid,” said Deputy Administrator and Center for Program Integrity Director Agrawal. “The diligent use of innovative data analytic systems has contributed or led directly to many of the law enforcement cases presented here today. CMS is committed to its collaboration with these agencies to keep federally-funded health care programs safe and strong for all Americans.”
The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations and since its inception in March 2007 has charged over 2,900 defendants who collectively have falsely billed the Medicare program for over $8.9 billion.
Including today’s enforcement actions, nearly 1,200 individuals have been charged in national takedown operations, which have involved more than $3.4 billion in fraudulent billings. Today’s announcement marks the second time that districts outside of Strike Force locations participated in a national takedown, and they accounted for 82 defendants charged in this takedown.
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For the Strike Force locations, in the Southern District of Florida, a total of 100 defendants were charged with offenses relating to their participation in various fraud schemes involving approximately $220 million in false billings for home health care, mental health services and pharmacy fraud. In one case, nine defendants have been charged with operating six different Miami-area home health companies for the purpose of submitting false and fraudulent claims to Medicare, including for services that were not medically necessary and that were based on bribes and kickbacks. In total, Medicare paid the six companies over $24 million as a result of the scheme.
In the Southern District of Texas, 24 individuals were charged in cases involving over $146 million in alleged fraud. One of these defendants is a physician with the highest number of referrals for home health services in the Southern District of Texas. This physician has been charged with participating in separate schemes to bill Medicare for medically unnecessary home health services that were often not provided. Numerous companies that submitted claims to Medicare using the fraudulent home health referrals from the physician were paid over $38 million by Medicare.
In the Northern District of Texas, 11 people were charged in cases involving over $47 million in alleged fraud. In one scheme, a physician allowed unlicensed individuals to perform physician services and then billed Medicare as if he performed them. Additionally, the physician certified patients for home health care that was often medically unnecessary. Home health companies submitted approximately $23.3 million in billings to Medicare based on the physician’s fraudulent certifications.
In the Central District of California, 22 defendants were charged for their roles in schemes to defraud Medicare of approximately $162 million. In one case, a doctor was charged with causing almost $12 million in losses to Medicare through his own fraudulent billing, including performing medically unnecessary vein ablation procedures on Medicare beneficiaries.
In the Eastern District of Michigan, 19 defendants face charges for their alleged roles in fraud, kickback, money laundering and drug distribution schemes involving approximately $114 million in false claims for services that were medically unnecessary or never rendered. Among these are owners of a physical therapy clinic who lured patients through the payment of cash kickbacks and medically unnecessary prescriptions for Schedule II medications for the purpose of stealing more than $36 million from Medicare.
In Tampa, Orlando and elsewhere in the Middle District of Florida, 15 individuals were charged with participating in a variety of schemes including compounding pharmacy fraud and intravenous prescription drug fraud involving $17 million in fraudulent billing. In one case, the owner of several infusion clinics allegedly defrauded the Medicare program of over $8 million through a scheme involving reimbursement claims for expensive intravenous prescription drugs that were never purchased and never administered to patients.
In the Northern District of Illinois, six individuals were charged in cases related to three different schemes involving bribery and false and fraudulent claims for home health services and disability benefits. The charged defendants include individuals who owned or co-owned the fraudulent providers and a medical doctor. In total, these schemes resulted in over $12 million being paid to the defendants and their companies.
In the Eastern District of New York, 10 individuals were charged in six different cases, including five individuals who were charged for their roles in a scheme involving over $86 million in physical and occupational therapy claims to Medicare and Medicaid. In that case, the defendants are alleged to have filled a network of Brooklyn clinics that they controlled with patients by paying bribes and kickbacks. Once at the clinics, these patients were subjected to medically unnecessary therapy. The defendants then laundered the proceeds of the fraud through over a dozen shell companies.
In the Eastern District of Louisiana, three defendants were charged in connection with a health care fraud and wire fraud conspiracy involving a defunct home health care provider. This scheme centered on the payment of kickbacks through patient recruiters in exchange for patients who oftentimes never received nor qualified for home health care as billed. Once admitted, patient medical records were routinely fabricated and altered to support false and fraudulent claims to Medicare.
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In addition to the Strike Force, today’s enforcement actions include cases brought by 26 U.S. Attorney’s Offices, including the unsealing of search warrants in investigations being conducted by the Eastern District of North Carolina, Southern District of Georgia, District of Columbia, Eastern District of Texas, Southern District of West Virginia, Middle District of Louisiana, District of Minnesota, and the Northern District of Alabama.
In the Northern District of Georgia, nine defendants were charged for their roles in two health care fraud schemes involving $7 million in fraudulent billings. Eight defendants were charged in a scheme where bribes and kickbacks were allegedly paid to a state of Georgia official in exchange for falsifying applications and licensing requirements and recommending the approval of unqualified mental health providers.
In the Middle District of Alabama, two defendants were charged for their roles in a mental health services scheme allegedly involving $246,000 in fraudulent billings.
In the Middle District of Tennessee, a doctor was charged for his role in an illegal kickback scheme under which he allegedly referred patients to a certain DME supplier in exchange for cash kickbacks.
In the Western District of Kentucky, a business entity was charged for its role in a health care fraud scheme.
In the Southern District of Ohio, two defendants were charged for their roles in a $7.5 million home healthcare fraud scheme.
In the Western and Eastern Districts of Pennsylvania, three defendants were charged for their roles in drug diversion and embezzlement schemes.
In the Southern District of New York, a pharmacist was charged for his role in a scheme involving over $51 million in fraudulent Medicare and Medicaid billings.
In the Districts of Maine, Alaska, Kansas, Connecticut and Vermont, five defendants were charged for their roles in Medicaid-related schemes.
In the Eastern District of Missouri, four defendants, including a doctor and pharmacist, were charged for their roles in schemes involving over $3 million in billings.
In the Southern District of California, eight individuals were charged in health care-related cases. In one case, five individuals, including a doctor and a pharmacist, were charged in a scheme to pay bribes and kickbacks to doctors in exchange for prescribing expensive durable medical equipment and compound pain creams that were not medically necessary. The indictment alleges that approximately $27 million in false and fraudulent claims were submitted to insurers.
In the District of New Mexico, two defendants were charged for their roles in a Medicaid fraud scheme.
In the Northern District of Iowa, a settlement agreement was reached with a corporate entity for its role in a health care fraud scheme in a juvenile residential treatment facility.
In the District of Oregon, one defendant was charged for his role in a $1.7 million optometry services scheme.
In the District of Puerto Rico, civil demand letters were issued to six individuals for their roles in a scheme to defraud the Medicaid program.
In addition, in the states of Florida, Iowa, South Dakota, Indiana, New York, Michigan, Oklahoma, Rhode Island, Louisiana, Pennsylvania, New Hampshire, Oregon, Kentucky and Alaska, 49 defendants have been charged in criminal and civil actions with defrauding the Medicaid program and 57 sites were searched, pursuant to search warrants. These cases were investigated by each state’s respective Medicaid Fraud Control Units.
The cases announced today are being prosecuted and investigated by U.S. Attorneys’ Offices nationwide, along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois and the Middle District of Florida; and agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.
A complaint or indictment is merely a charge, and all defendants are presumed innocent unless and until proven guilty.
The court documents for each case will posted online, as they become available, here: https://www.justice.gov/opa/documents-and-resources-june-22-2016-medicare-fraud-strike-force-press-conference.
The Affordable Care Act has provided new tools and resources to fight fraud in federal health care programs. The law provides an additional $350 million for health care fraud prevention and enforcement efforts, which has allowed the department to hire more prosecutors and the Strike Force to expand from two cities to nine. The act also toughens sentencing for criminal activity, enhances provider and supplier screenings and enrollment requirements and encourages increased sharing of data across government.
In addition to providing new tools and resources to fight fraud, the Affordable Care Act clarified that for sentencing purposes, the loss is determined by the amount billed to Medicare and increased the sentencing guidelines for the billed amounts, which has provided a strong deterrent effect due to increased prison time, particularly in the most egregious cases.
Since January 2009, the Justice Department’s Civil Division, along with U.S. Attorney’s Offices around the country, has recovered a total of more than $29.9 billion through False Claims Act cases, with more than $18.3 billion of that amount recovered in cases involving fraud against federal health care programs.
Moscow Man Pleads Guilty to Federal Child Pornography ChargeRead the Press Release
COEUR D'ALENE - James Dale Pressnall, 50, of Moscow, Idaho pleaded guilty yesterday to possession of sexually explicit images of minors, U.S. Attorney Wendy J. Olson announced. Pressnall was indicted by a federal grand jury in Coeur d'Alene on November 17, 2015.
According to the plea agreement, between December 2013, and February 2014, a Department of Homeland Security agent downloaded thirty-five child pornography files from a computer located in Moscow, Idaho. The computer was making the files available on a peer to peer network open to the general public. An internet service provider complied with a subpoena and advised that the computer distributing these images was located at Pressnall’s residence in Moscow, Idaho.
In March 2014, the Department of Homeland Security and the Moscow Police Department executed a federal search warrant at Pressnall’s residence. Pressnall was present during the search and admitted to using child pornography search terms to download child pornography over the internet. Several computers and computer storage devices were seized and the child pornography was located. The National Center for Missing and Exploited Children determined that Pressnall’s child pornography collection included images of minors from multiple states, including: Washington, Nebraska, Pennsylvania, California, Michigan, Connecticut, Delaware, Georgia, Florida, Vermont, Virginia, New York, and several foreign countries.
The charge of possession of sexually explicit images of minors is punishable by up to 10 years in prison, a maximum fine of $250,000.00, and up to lifetime supervised release.
Sentencing is set for September 7, 2016, before Chief United States District Judge B. Lynn Winmill at the federal courthouse in Coeur d'Alene.
The case was investigated through the collaborative effort of the Department of Homeland Security, Moscow Police Department, and Kootenai County Sheriff’s Office. These agencies participate in the Idaho Internet Crimes Against Children (ICAC) Task Force, a statewide coalition of local, state and federal law enforcement and prosecution agencies, focused on apprehending and prosecuting individuals who use the Internet to criminally exploit children. For more information about the Idaho ICAC Task Force and a list of all the participating agencies, visit www.icactaskforce.org.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Montana Man Sentenced to Federal Prison for Sexual Exploitation of MinorsRead the Press Release
BISMARCK - US Attorney Christopher C. Myers announced that on June 22, 2016, Michael Leroy Simmons Sr., 55, Butte, Montana, was sentenced before US District Judge Daniel L Hovland to serve 25 years in federal prison. After pleading guilty to two counts of an indictment charging him with Sexual Exploitation of Minors, Simmons was also sentenced to serve a lifetime of supervised release and must pay a $200 special assessment to the Crime Victims Fund.
From on or about July 1, 2011, until about March 31, 2013, Simmons used a camera to take sexually explicit photographs and videos of minors under the age of ten. In many of the photographs, Simmons touched the minors in order to take the photographs. That camera belonging to Simmons was discovered by a relative while visiting him in Butte, Mt., and the camera was turned over to the Butte Montana Police Department. Simmons, who is a registered sex offender, pled guilty to sexual exploitation of a minor on March 24, 2016.
This case was investigated by the Federal Bureau of Investigation, Butte-Silver Bow Law Enforcement Department
Assistant US Attorney Brandi Russell prosecuted this case.
Monroe man sentenced to 77 months in prison for distribution of methamphetamineRead the Press Release
MONROE, La. – United States Attorney Stephanie A. Finley announced that a Monroe man was sentenced Monday to 77 months in prison for distributing methamphetamine.
Antonio D’Andre Holmes, 36, of Monroe, was sentenced by U.S. District Judge Robert G. James on one count of distribution of methamphetamine. He was also sentenced to three years of supervised release. According to the March 8, 2016 guilty plea, Holmes was recorded selling methamphetamine on August 13 and 25, 2015. A confidential informant picked up the illegal drugs at Holmes’ Monroe residence and paid a total of $3,180. The methamphetamine bought during the sales weighed a total of 47.8 grams.
The defendant was arrested as part of Organized Crime Drug Enforcement Task Force (OCDETF) Operation “River City Blues.” The DEA, the Louisiana State Police, and the Lufkin Police Department investigated the case. The OCDETF program is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for targeting national and regional level drug trafficking organizations, coordinating the necessary law enforcement entities and resources to disrupt and dismantle the targeted criminal organization, and to seize its assets.
Assistant U.S. Attorney James G. Cowles Jr. prosecuted the case.
Med 1st of Evansville, P.C., Charged with Conspiracy to Commit Health Care Fraud, Conspiracy to Violate the Controlled Substance Act and Money LaunderingRead the Press Release
LOUISVILLE, Ky. – MED 1st of Evansville, P.C., located in Evansville, Indiana, was charged by Grand Jury Indictment today with conspiracy to commit health care fraud, health care fraud, and conspiracy to violate the Controlled Substance Act announced United States Attorney John E. Kuhn, Jr.
According to the four count indictment, beginning in January 2009, and continuing until at least May 2014, MED 1ST Of Evansville, P.C., conspired with others to commit health care fraud by causing the submission of false claims to Medicaid, Medicare, Anthem, and other insurance carriers.
Specifically, MED 1ST Of Evansville, P.C., knowingly and willfully executed a scheme to defraud health care benefit programs including Medicare, Medicaid, and Anthem, by directing staff members to provide medically unnecessary treatments to patients and fraudulently billing the health care benefit programs for the services. Claims were allegedly submitted for medically unnecessary facet block injections; conscious sedation, which was never performed; back braces, which were not medically necessary; and performing unnecessary tests for patients.
Further beginning on or about November 2011, and continuing until at least December 2012, MED 1ST Of Evansville, P.C., knowingly and intentionally conspired to distribute and dispense controlled substances in violation of the Controlled Substances Act. According to the indictment, Conspirator A, who was then a medical practitioner and Drug Enforcement Administration registrant, signed blank prescription pads and permitted individuals, acting at the direction of Conspirator B, who were not Drug Enforcement Administration registrants, to conduct evaluations of patients and to use these pre-signed prescription pads to prescribe medication to the patients.
Further, MED 1ST Of Evansville, P.C., conspired to commit money laundering by using the proceeds from a specified unlawful activity (health care fraud and unlawful distribution and dispensing of controlled substances) to promote and conceal that activity, and to engage in monetary transactions greater than $10,000 with proceeds derived from that specified unlawful activity.
Further, MED 1ST Of Evansville, P.C., is subject to forfeiture of any and all property constituting or derived from any proceeds the defendants obtained, directly or indirectly, as a result of the these violations, and any and all property used or intended to be used in any manner or part to commit and to facilitate the commission of these violations.
This case is being prosecuted by Assistant United States Attorneys Lettricea Jefferson-Webb and Jessica Malloy. This case is being investigated by the United States Drug Enforcement Administration, U.S. Department of Health and Human Services Office of Inspector General, Internal Revenue Service, Indiana Attorney General’s Office and Kentucky Attorney General’s Office.
McCracken County, Kentucky, Physician Charged with Fraudulent Possession of A Controlled Substance, Wire Fraud and Making False Statements Related to Health Care MattersRead the Press Release
PADUCAH, Ky. – A McCracken County, Kentucky, physician was charged by federal Information today with the fraudulent possession of a controlled substance, wire fraud and making false statements related to health care matters, announced United States Attorney John E. Kuhn, Jr.
According to the twelve-count federal Information, Sean P. McDonald, 46, devised a scheme to obtain prescription pain medication, while a treating physician at two Paducah, Kentucky, hospitals by falsely misrepresenting that he was removing medications for hospitalized patients, falsely possessing the controlled substances, and then falsely causing a request for payment to be sent from the two Paducah hospitals to the insurance carriers of the patients.
Specifically, it’s alleged that McDonald defrauded Lourdes Hospital and Western Baptist Hospital, by means of wire communication. From February 2009, through November 2010, McDonald caused a request for payment to be sent from Western Baptist Hospital and/or Lourdes Hospital, both located in Paducah, Kentucky, to patient’s insurance carriers.
During the same time period, McDonald made false and fraudulent statements to insurance carriers indicating that he had provided medication to patients when he had not.
Further, McDonald, as a prescribing physician with a DEA (Drug Enforcement Administration) registration number to issue prescriptions, wrote prescriptions for Dilauded, a Schedule II controlled substance, in violation of his DEA registration, to patients, when in fact he never provided the controlled substances to the patient.
If convicted at trial, McDonald would face a combined maximum term of imprisonment of 113 years, a combined maximum fine of $3,000,000 and a three year term of supervised release.
This case is being prosecuted by Assistant United States Attorneys Lettricea Jefferson-Webb and Seth Hancock and is being investigated by the United States Department of Health and Human Services Office of Inspector General, Kentucky Attorney General’s Office and Federal Bureau of Investigation.
The indictment of a person by a Federal Information is an accusation only and that person is presumed innocent until and unless proven guilty.
Marijuana Traffickers Plead Guilty to Federal ChargesRead the Press Release
AMARILLO, Texas — Two men from Moore County, Texas have pleaded guilty to federal offenses stemming from their respective roles in trafficking major quantities of marijuana, announced U.S. Attorney John Parker of the Northern District of Texas.
Late yesterday afternoon, Marco Saucedo, 44, of Cactus, Texas, pleaded guilty before U.S. District Judge Sidney A. Fitzwater to one count of unlawful use of a communications facility. Co-defendant Guadalupe Reyes, 49, of Etter, Texas, pleaded guilty last week before Judge Fitzwater to one count of conspiracy to distribute and possess with intent to distribute 1,000 kilograms or more of marijuana. Both defendants remain on bond.
Reyes faces a statutory penalty of not less than 10 years and up to life in federal prison and a $10 million fine. Saucedo faces a maximum statutory penalty of four years in federal prison and a $250,000 fine. Both defendants are scheduled to be sentenced by Judge Fitzwater on September 20, 2016.
According to documents filed in the case, in November 2014, officers with the Cactus Police Department responded to a weapon being discharged at a residence in Cactus that was owned by Guadalupe Reyes, and they determined that the individual who discharged the firearm was renting the property from Reyes. After obtaining consent to search, officers found more than $130,000 in cash inside the residence, which the resident advised was cash that he, at the direction of Reyes and Saucedo, brought back the previous week from Wichita and Topeka, Kansas.
The resident further disclosed he had been working for Reyes for several months, transporting large amounts of marijuana from Amarillo and Fritch, Texas, to other states, such as Kansas and Ohio. He would also transport large amounts of cash – proceeds from the sale of the marijuana – from those locations to the Cactus area, all at the direction of Reyes and Saucedo, who would pay him a set amount for each of the runs he made.
The resident indicated he had made approximately 10 trips to Wichita, Topeka, and Kansas City, Kansas, as well as to Toledo, Ohio, to deliver marijuana for Reyes, estimating that he had delivered approximately 8,000 pounds of marijuana while employed by Reyes. He further stated that on at least four occasions, he had returned with approximately $400,000 in cash for marijuana he had delivered. He further stated that Reyes instructed him to keep the money at the residence until it was retrieved by other, unnamed individuals. The individual also stated that both Reyes and Saucedo had directed him to only use pre-paid cell phones when communicating with them or the buyers.
In recorded conversations in November 2014, Reyes stated, among other things, that he was worried about law enforcement taking some of his properties. According to Reyes’ plea agreement, he agrees to not contest the forfeiture of several of his real estate holdings in Moore County, including two car lots and several residential properties.
The case is being investigated by the Federal Bureau of Investigation, the Texas Department of Public Safety, the Moore County Sheriff’s Office and the Cactus Police Department. Assistant U.S. Attorney Sean Long is in charge of the prosecution.
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Man Who Filed 26 False Tax Claims and Obstructed IRS Gets Significant SentenceRead the Press Release
HOUSTON – A federal judge has ordered Kenneth Robert Bruce to federal prison following his numerous convictions of willfully filing a false claim and impeding the IRS, announced U.S. Attorney Kenneth Magidson along with Special Agent in Charge Rick Goss of IRS - Criminal Investigation (CI). A jury convicted Bruce on all counts as charged March 19, 2015, following a five-day trial and approximately 2.5 hours of deliberation.
Today, U.S. District Judge Nancy Atlas, who presided over the trial, handed Bruce a 15-year-sentence and further ordered he pay more than $3.3 million to the IRS. He must also serve three years of supervised release following completion of the prison term. In handing down the sentence, Judge Atlas noted Bruce’s sophisticated scheme and that his relevant conduct - his intended tax loss in the entire scheme - was between $65 million and $150 million.
During trial, the jury heard that Bruce prepared 26 false income tax returns or amended income tax returns claiming a total of more than $9 million in false income tax refunds. One return was for himself and 25 were for other taxpayers.
“Knowingly falsifying documents filed with the IRS is a serious crime,” said Goss. “This defendant not only created false income forms but used those forms to make fraudulent claims in excess of $9 million against the U.S. government. IRS-CI agents are committed to stopping this type of abuse of the tax system.”
Bruce attached false IRS forms 1099-OID (Original Issue Discount) to the tax returns, falsely reporting the taxpayers had received huge amounts of income from OID and had all or nearly all of the false amounts of income withheld for federal income taxes. The huge, false amounts of withholdings formed the bases for the claims for false claims for tax refunds.
The jury also convicted Bruce on one count of corruptly endeavoring to obstruct and impede the administration of the Internal Revenue Code.
Bruce was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
The convictions were the result of an investigation by IRS - CI and the Treasury Inspector General for Tax Administration. Assistant U.S. Attorneys Charles J. Escher and Jim McAlister are prosecuting the case.
Lea County Woman Pleads Guilty to Federal Production of Child Pornography ChargeRead the Press Release
ALBUQUERQUE – Kyla Norby, 27, of Hobbs, N.M., pled guilty in federal court in Las Cruces, N.M., this afternoon to a production of child pornography charge. Under the terms of her plea agreement, Norby will be sentenced to 15 years in federal prison followed by 15 years of supervised release. Norby also will be required to register as a sex offender when she completes her prison sentence. The guilty plea was announced by U.S. Attorney Damon P. Martinez, Special Agent in Charge Waldemar Rodriguez of Homeland Security Investigations (HSI) in El Paso, and Lea County Sheriff Steve Ackerman.
Norby was arrested on Jan. 8, 2016, on a criminal complaint alleging that Norby produced and distributed child pornography between May 1, 2015 and Dec. 30, 2015, in Lea County, N.M. According to the criminal complaint, the investigation into Norby was initiated after Homeland Security Investigations (HSI) agents from Laredo, Tex., arrested a man in Odessa, Tex., who revealed that Norby made a two-year old child sexually available to him. A search of the man’s smartphone revealed photos of Norby, including images consistent with child pornography, that Norby sent to the man from her smartphone.
During today’s proceedings, Norby pled guilty to a felony information charging her with production of child pornography. In her plea agreement, Norby admitted that on Oct. 25, 2015, she used a smartphone to take a sexually explicit photograph of a toddler with the intention of sharing the photograph with an individual in Texas.
This case was investigated by the Las Cruces office of HSI and the Lea Country Sheriff’s Office, both members of the New Mexico Internet Crimes Against Children (ICAC) Task Force, with assistance from HSI in Laredo, Texas. The case is being prosecuted by Assistant U.S. Attorney Marisa A. Lizarraga of the U.S. Attorney’s Las Cruces Branch Office.
This case is being prosecuted as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s 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 brought as a part of the New Mexico ICAC Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 82 federal, state and local law enforcement agencies associated with the New Mexico ICAC Task Force, which is funded by a grant administered by the Office of the New Mexico Attorney General. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Lawrence Tax Preparer and Former School Teacher Sentenced for Filing False Claims for RefundRead the Press Release
BOSTON – A Lawrence tax preparer and former teacher in the Lawrence and Boston school systems was sentenced today in U.S. District Court in Boston in connection with his role in defrauding the IRS of hundreds of thousands of dollars by filing false tax returns.
Leonidas Nunez, 61, was sentenced by U.S. District Court Judge William G. Young to 20 months in prison, two years of supervised release and ordered to pay restitution of $221,964 to the IRS. In March 2015, he pleaded guilty to one count of conspiring to defraud the IRS and six counts of submitting false claims for tax refunds.
From October 2010 through April 2011, Nunez conspired with others to defraud the IRS by presenting false income tax returns to the IRS. The returns falsely alleged income earned by more than 100 Puerto Rican residents who had not had federal income tax withheld and who were not required to file income tax returns in the United States. Nunez and his co-conspirators further directed the IRS to deposit the resulting fraudulent refunds into bank accounts controlled by Nunez and his co-conspirators. Together, they filed over 100 fraudulent returns with the IRS for tax year 2010, resulting in over $550,000 in fraudulent claims and over $220,000 in refunds.
United States Attorney Carmen M. Ortiz and Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today. The case was prosecuted by Assistant U.S. Attorney William F. Bloomer of Ortiz’s Public Corruption Unit.
Large-quantity drug bust results in meth dealer pleading guilty to Federal crimeRead the Press Release
CHARLESTON, W.Va. – A Montgomery man caught with substantial amounts of methamphetamine, heroin, and marijuana pleaded guilty today to a federal drug charge, announced Acting United States Attorney Carol Casto. Bryan Lee Palmer, 43, entered his guilty plea to possession with intent to distribute methamphetamine.
Palmer admitted that on February 26, 2016, he made arrangements for a drug deal to take place at a hotel in South Charleston. When Palmer arrived at the hotel, he was met by law enforcement. The officers obtained a search warrant for a duffel bag and backpack that was in Palmer’s possession. When officers searched the bags, they found over 1,500 grams of methamphetamine, approximately 700 grams of heroin, over a half a kilogram of marijuana, a loaded .45 caliber semi-automatic pistol, and over $30,000 in cash. Palmer further admitted that it was his intent to distribute the drugs in the Charleston area. Law enforcement estimated the street value of the seized drugs to be approximately $466,000.
Palmer faces up to 20 years in federal prison when he is sentenced on October 12, 2016.
The case against Palmer was investigated by the Kanawha County Sheriff’s Office and members of its Sheriff’s Tactical Operations Patrol (STOP) team. Assistant United States Attorney Timothy D. Boggess is in charge of the prosecution. The plea hearing was held before United States District Judge John T. Copenhaver, Jr.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of illegal drugs, including methamphetamine and heroin. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down pill trafficking, eliminating open air drug markets, and curtailing the spread of illegal drugs in communities across the Southern District.
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Kevin Michael Pippin Sentenced to 124 Months in Federal Prison for Child Pornography OffensesRead the Press Release
KNOXVILLE, Tenn.- On June 22, 2016, Kevin Michael Pippin, 41, of Knoxville, Tenn., was sentenced by the Honorable R. Leon Jordan, Senior U.S. District Judge, to serve 124 months in prison for distributing and possessing child pornography. Following his release from prison, he will be supervised by the U.S. Probation Office for 15 years and required to register with the sex offender registry in any state in which he resides, works, or attends school.
Pippin pleaded guilty in July 2015 to federal charges stemming from an undercover investigation into distribution of child pornography via peer-to-peer file sharing software on the Internet. After undercover investigators downloaded child pornography from Pippin’s computer, a federal search warrant was executed at his residence. A forensic examination of his computer equipment revealed that he had collected thousands of images and 82 videos of child pornography. A large assortment of the depictions of child abuse collected by Pippin was available for download by others from his computer through the use of the peer-to-peer software.
During the sentencing hearing, Judge Jordan remarked that the “staggering” number of images of child pornography the defendant had collected justified, in part, the length of the of the prison sentence.
This investigation was conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Matthew Morris represented the United States.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the 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 www.projectsafechildhood.gov.
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Kearney Man Sentenced for Possession of Child PornographyRead the Press Release
United States Attorney Deborah R. Gilg announced that Sean Peterson, 32, of Kearney, Nebraska, was sentenced on June 17, in Lincoln, Nebraska, to four years, 96 months in prison by United States District Judge John M. Gerrard, for possession of child pornography. After his release from prison, Peterson will be required to serve a 15-year term of supervised release and be registered as a sex offender.
In September of 2014, Xoom.com, an online international money transfer service, notified Yahoo! that a number of Yahoo! accounts were engaged in the sale of child exploitation material. Investigation determined that several email accounts, operating overseas, were believed to be selling images, video and live-streamed sexual abuse. One of these individuals was communicating with Peterson about having sex with minors. Peterson also sent the person images of child pornography through web based messenger accounts.
On July 7, 2015, a search warrant was issued on Peterson’s residence and he admitted to accessing child pornography web sites using the Internet. The forensic investigation of the computer equipment found at Peterson’s residence revealed approximately 1,000 images of child pornography, including visual depictions of prepubescent minors engaged in sexually explicit conduct.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Federal Bureau of Investigation.
Justice Department Settles Immigration-Related Discrimination Claim Against Macy’sRead the Press Release
The Justice Department reached an agreement today with Macy’s over allegations that the large national retailer violated the Immigration and Nationality Act (INA) by discriminating against work-authorized non-U.S. citizens at its Glendale, California, location.
The department’s investigation was based on a charge filed by a lawful permanent resident whose hiring was delayed in October 2015. The charging party alleged, and the investigation found, that she was not able to begin working at Macy’s even though she showed sufficient proof of her work authorization because a Macy’s hiring official incorrectly believed that lawful permanent residents were required to produce unexpired permanent resident cards. The investigation also found that other human resource employees in Macy’s Glendale location were imposing the same unnecessary requirement on four other lawful permanent residents. In contrast, U.S. citizens were permitted to choose whichever valid documents they wanted to present to prove their work authorization. Under the INA, lawful permanent residents do not have to show their permanent resident cards when they start working. Instead, like all workers, they can choose whichever documentation the would like to present, such as a driver’s license and unrestricted social security card, from the lists of acceptable documents.
Under the settlement agreement, Macy’s will, among other things, provide additional training to its employees and assess its employees’ understanding of applicable rules. Macy’s will also pay an $8,700 civil penalty and periodically produce Form I-9 information to the department for review.
“Macy’s did the right thing by immediately resolving the charging party’s delayed hiring and by giving her full back pay,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department's Civil Rights Division. “All employers should take care not to impose unlawful burdens on employees because of their citizenship or immigration status and address issues promptly when they make mistakes.”
The Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) is responsible for enforcing the anti-discrimination provision of the INA. The law prohibits, among other things, citizenship, immigration status and national origin discrimination in hiring, firing, recruitment or referral for a fee; unfair documentary practices in employment eligibility verification; retaliation and intimidation.
To learn more about the protections against employment discrimination under immigration laws, call OSC’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call OSC’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar at www.justice.gov/crt/about/osc/webinars.php; email [email protected] or visit OSC’s website at www.justice.gov/crt/about/osc.
Applicants or employees who believe they have been subjected to: different documentary requirements based on their citizenship, immigration status or national origin; or discrimination based on their citizenship, immigration status or national origin in hiring, firing or recruitment or referral, should contact OSC’s worker hotline for assistance.
Macy's Settlement Agreement
Jena man arrested for illegal possession of silencersRead the Press Release
MONROE, La. – United States Attorney Stephanie A. Finley announced that a Jena man pleaded guilty Monday to possessing unregistered silencers, which he also constructed and sold.
Robert E. Durham, 34, of Jena, La., pleaded guilty before U.S. Magistrate Judge Karen L. Hayes to one count of possession of an unregistered firearm. It will become final once accepted by U.S. District Judge Robert G. James. According to the guilty plea, the defendant was recorded setting up a sale of silencers with an undercover ATF agent. They met on May 10, 2016 in Winnfield, La., and the undercover agent purchased three silencers. Law enforcement agents then searched Durham’s home on May 19, 2016. They found and seized silencers, homemade firearm suppressors, ammunition, tools and a drill press to make silencers, silencer parts, and packaged “solvent trap kits,” which are also used to make silencers. The silencers and silencer parts and kits are defined as firearms according to federal law and are required to be registered in the National Firearms Registration and Transfer Record. The illegal silencers Durham possessed were not registered.
Durham faces up to 10 years in prison, three years of supervised release and a $10,000 fine. A sentencing date of October 5, 2016 was set.
The ATF and the Louisiana State Police conducted the investigation. Assistant U.S. Attorney James G. Cowles Jr. is prosecuting the case.
Iowa Businessman Pleads Guilty to Failing to Pay Employment TaxesRead the Press Release
A Forest City, Iowa, businessman pleaded guilty today in federal court to failing to pay employment taxes, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Kevin W. Techau of the Northern District of Iowa.
Darrell Smith, 60, was charged in an indictment in January 2016 with multiple counts of willfully failing to collect, truthfully account for and pay federal employment taxes that were withheld from the wages of employees of Permeate Refining Inc., an ethanol-production business in Hopkinton, Iowa.
“Today’s plea reaffirms our commitment to prosecuting employers who willfully fail to comply with their employment tax obligations,” said Acting Assistant Attorney General Ciraolo. “Working with our law enforcement partners in the Internal Revenue Service (IRS), the Department of Justice will continue to vigorously investigate and prosecute those who seek to cheat the U.S. Treasury and gain an unfair advantage over their competitors.”
“Mr. Smith’s attempt to dodge his legal obligation to account for and pay employment taxes did not go unchecked, and he will now be held accountable for his criminal conduct,” said U.S. Attorney Techau.
At his guilty plea hearing, Smith admitted that he collected and willfully failed to account for and pay over to the IRS $85,267 for the second quarter of 2012. A sentencing date has not yet been set. Smith faces a statutory maximum sentence of five years in prison as well as a term of supervised release and monetary penalties. Smith’s co-defendant Randy Less pleaded guilty on June 14 to failing to pay employment taxes and violating the Clean Water Act.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Techau thanked special agents of IRS-Criminal Investigation, the FBI, the U.S. Postal Inspection Service and the U.S. Environmental Protection Agency, who investigated the case and Assistant U.S. Attorney Tim Vavricek of the Northern District of Iowa and Trial Attorney Matthew Hoffman of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division’s Employment Tax Enforcement efforts may be found here.
Iowa Businessman Pleads Guilty to Failing to Pay Employment TaxesRead the Press Release
CEDAR RAPIDS, IA—A Forest City, Iowa, businessman pleaded guilty today in federal court to failing to pay employment taxes, announced U.S. Attorney Kevin W. Techau of the Northern District of Iowa and Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
Darrell Smith, 60, was charged in an indictment in January 2016 with multiple counts of willfully failing to collect, truthfully account for and pay federal employment taxes that were withheld from the wages of employees of Permeate Refining Inc., an ethanol-production business in Hopkinton, Iowa.
“Mr. Smith’s attempt to dodge his legal obligation to account for and pay employment taxes did not go unchecked, and he will now be held accountable for his criminal conduct,” said U.S. Attorney Techau.
“Today’s plea reaffirms commitment to prosecuting employers who willfully fail to comply with their employment tax obligations,” said Acting Assistant Attorney General Ciraolo. “Working with our law enforcement partners in the Internal Revenue Service (IRS), the Department of Justice will continue to vigorously investigate and prosecute those who seek to cheat the U.S. Treasury and gain an unfair advantage over their competitors.”
At his guilty plea hearing, Smith admitted that he collected and willfully failed to account for and pay over to the IRS $85,267 for the second quarter of 2012. A sentencing date has not yet been set. Smith faces a statutory maximum sentence of five years in prison as well as a term of supervised release and monetary penalties. Smith’s co-defendant Randy Less pleaded guilty on June 14 to failing to pay employment taxes and violating the Clean Water Act.
A sentencing date has not yet been set. Smith faces a statutory maximum sentence of five years in prison as well as a term of supervised release and monetary penalties.
U.S. Attorney Techau and Acting Assistant Attorney General Ciraolo thanked special agents of IRS Criminal Investigation, the FBI, the U.S. Postal Inspection Service and the U.S. Environmental Protection Agency, who investigated the case and Assistant U.S. Attorney Tim Vavricek of the Northern District of Iowa and Trial Attorney Matthew Hoffman of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division’s Employment Tax Enforcement efforts may be found here.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 16-CR-2002-LTS.
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