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Wednesday 22 June 2016
Husband and Wife Owners of First Mutual Bancorp of Illinois Indicted in Scheme to Hide Millions of Dollars in Cash and Assets from CreditorsRead the Press Release
CHICAGO — An Oak Brook couple who owned First Mutual Bancorp of Illinois and other financial entities intentionally hid cash and assets from creditors after defaulting on $40 million in personal and corporate loans, according to an indictment returned in federal court in Chicago.
PETHINAIDU VELUCHAMY and his wife, PARAMESWARI VELUCHAMY, were the principal shareholders of First Mutual Bancorp of Illinois Inc., a holding company for Mutual Bank. In June 2009, according to the indictment, the couple defaulted on personal and corporate loans totaling $40 million. The following month, Mutual Bank was shut down by federal regulators. Prior to the shutdown and continuing until at least November 2015, the couple hid millions of dollars in assets by falsifying documents, moving money into domestic and foreign bank accounts, and directing employees to destroy financial records, the indictment states. The couple also transferred cash to their two adult children, with nearly $8.5 million going to one and more than $10.1 million to the other, according to the indictment.
The 12-count indictment was returned yesterday in U.S. District Court in Chicago. It charges Pethinaidu Veluchamy, 70, with four counts of bank fraud, two counts of destroying records to obstruct a bankruptcy proceeding, two counts of making a false statement under oath in a bankruptcy proceeding, and one count of making a false statement in an application for a U.S. passport. Parameswari Veluchamy, 65, is charged with four counts of bank fraud, two counts of destroying records to obstruct a bankruptcy proceeding, one count of making a false statement under oath in a bankruptcy proceeding, and one count of making a false statement in an application for a U.S. passport.
Arraignments in federal court in Chicago have not yet been scheduled.
According to the charges, Pethinaidu Veluchamy caused his relatives to obtain legal judgments against him for loans for which he knew he was not personally liable, so that he could later assert those liens as superior to a bank creditor’s anticipated judgments. In a 2011 deposition in a separate court case, Pethinaidu Veluchamy fraudulently claimed that certain funds transferred to his adult children represented indemnity obligations for their investments in First Mutual Bancorp, according to the indictment. He produced a document to support this claim, but when questioned about the timing of the creation of the document, Pethinaidu Veluchamy claimed the computer he had used to create it crashed in a snowstorm, according to the indictment.
The indictment was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.
Each count of bank fraud is punishable by up to 30 years in prison and a $1 million fine. Destroying records to obstruct a bankruptcy proceeding carries a maximum sentence of 20 years. The maximum sentence for making a false statement under oath in a bankruptcy proceeding is five years, while making a false statement in an application for a U.S. passport is punishable by up to ten years.
The public is reminded that an indictment is 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. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
The government is represented by Assistant U.S. Attorney Bethany Biesenthal and Special Assistant U.S. Attorney Jeffrey Snell.
Indictment
Hartford Man Sentenced to 70 Months in Federal Prison for Selling Crack and HeroinRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, announced that EDGARDO TORRES, also known as “Eggy,” 37, of Hartford, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to 70 months of imprisonment, followed by four years of supervised release, for distributing crack cocaine and heroin.
This matter stems from Project Longevity, a comprehensive initiative to reduce gun violence in Connecticut’s major cities. Through Project Longevity, community members and law enforcement directly engage with members of groups that are prone to commit violence. A critical component of the Project Longevity strategy is the “call-in,” a face-to-face meeting where Project Longevity partners engage group members and deliver a community message against violence, a law enforcement message about the consequences of further violence and an offer of help for those who want it. Members of Los Solidos attended call-ins that were held in April 2014 and August 2014, but after a spate of shootings involving Los Solidos members and associates, law enforcement directed its coordinated attention to the group.
According to court documents and statements made in court, in September 2014, the FBI’s Northern Connecticut Violent Crimes Task Force and Hartford Police Department initiated an investigation into narcotics distribution, firearms trafficking and acts of violence carried out by members and associates Los Solidos in Hartford’s South End. The investigation, which culminated in June 2015 with the indictment of more than 30 defendants, included the use of court-authorized wiretaps, controlled purchases of heroin, crack cocaine and firearms, and the execution of more than 15 searches. These law enforcement efforts resulted in the seizure of 24 firearms, approximately $74,000, two kilograms of crack cocaine, two kilograms of powder cocaine, one kilogram of heroin, 7,000 bags of packaged heroin, and four vehicles.
Between September 2014 and February 2015, the FBI’s Task Force and Hartford Police Department conducted 14 controlled purchases of heroin and/or crack cocaine from TORRES.
TORRES has been detained since his arrest on June 15, 2015. On March 17, 2016, he pleaded guilty to one count of possession with intent to distribute and distribution of cocaine base (“crack”) and heroin.
This case is being prosecuted by Assistant U.S. Attorneys Michael J. Gustafson and Gabriel J. Vidoni.
Harrisburg Man Indicted for Possession of Crack and Possession of A Firearm in Furtherance of Drug TraffickingRead 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 indicted Jwane Johnson for possession with intent to distribute crack, possession of a handgun by a convicted felon, and possession of a firearm in furtherance of drug trafficking.
According to U.S. Attorney Peter Smith, Johnson, a 28 year old resident of Harrisburg, allegedly attempted to distribute crack near the Allison Hill section of Harrisburg on December 8, 2015. When the sale was interrupted by Harrisburg Police, he allegedly fled leaving behind a handgun. Johnson was arrested on January 2, 2016 by Harrisburg Police.
The matter was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives with the Harrisburg Police Department. The case is being prosecuted by Assistant U.S. Attorney Scott R. Ford.
This case was brought as part of the Violent Crime Reduction Partnership (“VCRP”), a district wide initiative to combat the spread of violent crime in the Middle District of Pennsylvania. Led by the United States Attorney’s Office, the VCRP consists of federal, state and local law enforcement agencies whose mission is to locate, apprehend, and prosecute individuals who commit violent crimes.
Indictments 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 this offense is up to life in prison, 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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Harrisburg Man Indicted Federally for Unlawful Firearm Possession ChargeRead the Press Release
HARRISBURG- The United States Attorney’s Office for the Middle District of Pennsylvania announced today that a Harrisburg man was indicted by a federal grand jury in Harrisburg for being a convicted felon in possession of a firearm.
According to United States Attorney Peter Smith, Hassan Ward, age 32, allegedly possessed a loaded 9 mm handgun after having been convicted of at least three previous violent felonies or serious drug offenses. Ward was initially arrested by Harrisburg Police on April 1, 2016.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Harrisburg Bureau of Police and is being prosecuted by Assistant United States Attorney Daryl F. Bloom.
This case was brought as part of the Violent Crime Reduction Partnership (“VCRP”), a districtwide initiative to combat the spread of violent crime in the Middle District of Pennsylvania. Led by the United States Attorney’s Office, the VCRP consists of federal, state and local law enforcement agencies whose mission is to locate, apprehend, and prosecute individuals who commit violent crimes.
Indictments 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 life imprisonment, a term of supervised release following imprisonment, and a $250,000 fine. This offense carries a mandatory term of imprisonment of 15 years. 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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Harrisburg Man Charged with Unlawful Possession of A FirearmRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Brian Acosta, age 21, a resident of Harrisburg, was indicted by a grand jury in Harrisburg and charged with possession of a firearm by a convicted felon.
According to U.S. Attorney Peter Smith, on December 27, 2015, Harrisburg police officers allegedly observed Acosta walking in the 1500 block of Vernon Street at approximately 8:30 p.m., brandishing a firearm. Acosta threw the gun away and fled. He was apprehended and the firearm was recovered.
This investigation is being conducted by the Federal Bureau of Investigation and the Harrisburg Bureau of Police and is being prosecuted by Assistant United States Attorney Meredith A. Taylor.
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 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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Guyana citizen charged with falsifying an application for a U.S. passportRead the Press Release
ELKINS, WEST VIRGINIA – A federal grand jury returned an indictment charging Joseph Fedrick, 42, of Guyana, with falsifying an application for a United States passport, U.S. Attorney William J. Ihlenfeld, II, announced.
Fedrick executed an application for a United States passport in Berkeley County, West Virginia. Within the application, Fedrick attempted to use a false social security number with the intent to secure the passport fraudulently.
Fedrick is charged with one count of “False Statement in Application for Passport.” He faces up to ten years in prison and up to $250,000 in fines. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Shawn M. Adkins is prosecuting the case on behalf of the government. The Department of the State Diplomatic Security Service and the United States Department of Homeland Security are investigating.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
Georgia Resident Sentenced for Laundering Proceeds from a Stolen Identity Refund Fraud SchemeRead the Press Release
Defendant Used Stolen Identification Information to Access “Get Transcript” Database and File False Returns
An Austell, Georgia, resident was sentenced today to 15 months in prison for his role in laundering proceeds from a stolen identity refund fraud scheme, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney John A. Horn of the Northern District of Georgia.
Rapheal Atebefia pleaded guilty to one count of money laundering on March 25. According to court documents, Atebefia and his co-conspirators obtained the means of identification of actual individuals, including their names and social security numbers, and used this information to access the Internal Revenue Service’s (IRS) “Get Transcript” database. The stolen names and the information obtained from Get Transcript were used to file false income tax returns. Atebefia’s co-conspirators obtained prepaid debit cards from stores located in multiple states and registered the cards in the names of the stolen identities. These debit cards were used to receive the income tax refunds requested on the false tax returns. To conceal this fraudulent scheme, the prepaid debit cards were then used to purchase money orders. Atebefia deposited the money orders into his bank accounts and then structured cash withdrawals of the proceeds in order to prevent the bank from filing Currency Transaction Reports.
In addition to the prison term, Atebefia was ordered to serve three years of supervised release and to pay restitution in the amount of $52,621 to the IRS. Atebefia’s co-defendants, Anthony and Sonia Alika, are scheduled to be sentenced on July 27.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Horn commended special agents of IRS-Criminal Investigation and the U.S. Postal Inspection Service, who investigated the case and Trial Attorneys Michael C. Boteler and Charles M. Edgar Jr. of the Tax Division and Assistant U.S. Attorney Brian Pearce, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Georgia Dentist Indicted for Medicaid Fraud and Money LaunderingRead the Press Release
ATLANTA – A federal grand jury has indicted Oluwatoyin Solarin for filing false Medicaid claims, money laundering, and seeking to evade banking reporting requirements.
“Medicaid funds should benefit truly deserving members of society,” said U. S. Attorney John Horn. “When medical practitioners allegedly steal Medicaid funds for their own selfish benefit, this diverts scarce resources away from those who need them most.”
“Fighting Medicaid fraud is a top priority for my office,” said Georgia Attorney General Sam Olens. “Those that steal these funds will be prosecuted.”
“The OIG is committed to investigating all allegations of individuals who target the vulnerable and unsuspecting refugee community,” said Derrick L. Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta.
“The integrity of the medical profession must be protected from people like Dr. Solarin, who allegedly seek to illegally profit by pretending to provide legitimate medical services,” stated Veronica Hyman-Pillot, Special Agent in Charge, IRS Criminal Investigation. “Health care fraud diverts funds from individuals who legitimately need care. Through joint investigations such as this, we intend to continue to aggressively pursue those who steal from taxpayers and receive money that they are not entitled to.”
According to U.S. Attorney Horn, the indictment, a civil forfeiture complaint, and other information presented in court: Solarin was a dentist who ran “Care Dental,” a small dental franchise with offices in Doraville and Duluth, Georgia. Over a period of at least four years, Solarin allegedly submitted numerous false bills to the Georgia Medicaid Program that falsely claimed Solarin had performed dental procedures on Medicaid recipients.
The indictment alleges that on various dates that Solarin claimed she was treating Medicaid recipients, she was not even in the state of Georgia, and was sometimes overseas. Patients were seen at times by another dentist at Care Dental who Solarin knew was not permitted to file Medicaid claims. At other points, Solarin allegedly directed at least one employee to falsify service dates on Medicaid claims so that it would appear dental work was being done on dates that the patient was eligible for Medicaid.
Solarin also allegedly paid individuals to recruit Nepalese refugee children to come to Care Dental for dental services. Parents were not always consulted when these children were seen at Care Dental.
The indictment further alleges that Oluwatoyin Solarin, 45, Atlanta, Georgia, tried to mask financial transactions and also used the fraudulent proceeds for her own benefit. On various occasions during the course of this fraud scheme, Solarin made cash deposits into a bank account directly under $10,000, with the purpose of evading banking reporting requirements. Solarin used the proceeds of this scheme to purchase rental properties throughout the Atlanta area. In a separate civil forfeiture action, the government is seeking to forfeit Solarin’s interest in over a dozen real properties located throughout the state of Georgia.
Members of the public are reminded that the indictment contains only allegations. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.
This case is being investigated by the U.S. Department of Health and Human Services, Office of the Inspector General, investigators from the Georgia Medicaid Fraud Control Unit, and Internal Revenue Service Criminal Investigation.
Assistant United States Attorney Thomas J. Krepp and Georgia Assistant Attorney General Lyndie M. Freeman are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Fresh Start Reentry Program Invites Former Offenders to Attend Information and Resource SeminarRead the Press Release
TULSA, Okla.—The Fresh Start Reentry Program will host an information and resource seminar for individuals with prior felony convictions on Thursday, June 23, announced United States Attorney Danny C. Williams Sr. of the Northern District of Oklahoma. The seminar will be held from 6:00 to 7:00 p.m., in the Auditorium of the Robert S. Kerr Building, 440 S. Houston Ave. in Tulsa.
United States Attorney Williams said, “The Fresh Start Reentry Program is committed to preparing those who have paid their debt to society for opportunities after incarceration. Removing reentry barriers helps individuals successfully reenter society and become contributing members to their communities. I encourage individuals to attend and to take advantage of this opportunity.”
At the seminar, DePorres Hopkins, of Oklahoma City, will be the Success Speaker, a person who was formerly incarcerated and is now a contributing member of society. Mr. Hopkins served his prison sentence in El Reno Federal Correction Institution and Jess Dunn Correctional Center in Taft, Okla. for drug trafficking. While incarcerated he earned college credit hours, learned three trades and became the Resident Barber. He currently owns Hopkins Haircare & Enterprises and UpScale Real Estate Development & Construction. Additionally, he is on the advisory board for Mid Del Vo-Tech and Metro Tech Vo-Tech, and serves on the NE Renaissance Steering Committee that is revitalizing North East Oklahoma City.
To register for this event, contact Reentry Coordinator Loretta Radford at (918) 382-2700.
The Fresh Start Reentry Program is dedicated to reducing criminal recidivism in the Northern District by helping individuals with felony convictions gain access to resources and to provide the necessary motivation for success when reintegrating into the community. The Fresh Start Reentry Program is in coordination with the United States Probation Office, the Tulsa County District Attorney’s Office, the Oklahoma Department of Corrections, and the Oklahoma Department of CareerTech Education. For more information about the Fresh Start Reentry Program, please visit www.justice.gov/usao-ndok.
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Fort Hall Man Sentenced to 33 months for Assault on an OfficerRead the Press Release
POCATELLO – Lyle Plentywounds, Sr., 60, of Fort Hall, Idaho, was sentenced today to a total of 33 months in prison for assault on an officer and for a violation of his supervised release on a previous case, which also involved an assault on an officer, U.S. Attorney Wendy J. Olson announced. Plentywounds received a 21 month sentence for the new assault on officer case and an additional 12 month consecutive sentence for the supervised release violation on the previous case. Chief U.S. District Judge B. Lynn Winmill also ordered Plentywounds to serve three years of supervised release. Plentywounds pleaded guilty to the new charge of assault on an officer on April 11, 2016.
On June 23, 2015, officers from the Fort Hall Police Department responded to a residence on the Fort Hall Indian Reservation on a report that the Plentywounds was causing a disturbance at that location. Officers arrived at the location and found Plentywounds to be intoxicated, which is a violation of Tribal law. Officers took Plentywounds into custody. While officers were taking him to the patrol car, Plentywounds struggled with the officers and kicked an officer in the leg. Under the specific federal law that Plentywounds pled guilty to violating, Fort Hall police officers are considered “federal officers.”
The case was investigated by the Fort Hall Police Department and the Federal Bureau of Investigation.
Former Swiss Banker Pleads Guilty to Conspiring with U.S. Taxpayers and Other Swiss Bankers to Defraud the United StatesRead the Press Release
A former Credit Suisse AG banker, who has been a fugitive since 2011, pleaded guilty today in U.S. District Court in the Eastern District of Virginia to charges related to aiding and assisting U.S. taxpayers in evading their income taxes, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Dana J. Boente of the Eastern District of Virginia.
Michele Bergantino, 48, a citizen of Italy and a resident of Switzerland, pleaded guilty before U.S. District Judge Gerald Bruce Lee to conspiring to defraud the United States by assisting U.S. taxpayers to conceal foreign accounts and evade U.S. tax during his employment as a banker working for Credit Suisse AG on its North American desk.
“Mr. Bergantino is now the third fugitive to come to the United States and plead guilty to charges in this case,” said Acting Assistant Attorney General Ciraolo. “To those who have actively assisted U.S. taxpayers in using offshore accounts to evade taxes, the message is clear: staying outside the United States will provide little comfort. We will investigate and charge you, and will work relentlessly to hold you to account for your actions.”
“Hiding assets and creating secret accounts in an attempt to evade income taxes is a losing game,” said U.S. Attorney Boente. “Today’s plea shows that we will continue to prosecute bankers and U.S. citizens who engage in this criminal activity. I want to thank our law enforcement partners and prosecutors for their work on this important case.”
Bergantino admitted that from 2002 to 2009, while working as a relationship manager for Credit Suisse in Switzerland, he participated in a wide-ranging conspiracy to aid and assist U.S. taxpayers in evading their income taxes by concealing assets and income in secret Swiss bank accounts. Bergantino oversaw a portfolio of accounts, largely owned by U.S. taxpayers residing on the West Coast, which grew to approximately $700 million of assets under management. Bergantino admitted that the tax loss associated with his criminal conduct was more than $1.5 million but less than or equal to $3.5 million.
During his time as a relationship manager, Bergantino assisted many U.S. clients in utilizing their Credit Suisse accounts to evade their U.S. income taxes and to facilitate concealment of the U.S clients’ undeclared financial accounts from the U.S. Treasury Department and the Internal Revenue Service (IRS). Among the steps taken by Bergantino to assist clients in hiding their Swiss accounts were the following: assuring them that Swiss bank secrecy laws would prevent Credit Suisse from disclosing their undeclared accounts to U.S. law enforcement; discussing business with clients only when they traveled to Zurich to meet him; structuring withdrawals from their undeclared accounts by sending multiple checks, each in amounts below $10,000, to clients in the United States; facilitating the withdrawal of large sums of cash by U.S. customers from their Credit Suisse accounts at Credit Suisse offices in the Bahamas, in Switzerland, particularly the Credit Suisse branch at the Zurich airport and at a financial institution in the United Kingdom; holding clients’ mail from delivery to the United States; issuing withdrawal checks from Credit Suisse’s correspondent bank in the United States; and taking actions to remove evidence of a U.S. client’s control over an account because the U.S. client intended to file a false and fraudulent income tax return. Moreover, Bergantino understood that a number of his U.S. clients concealed their ownership and control of foreign financial accounts by holding those accounts in the names of nominee tax haven entities, or structures, which were frequently created in the form of foreign partnerships, trusts, corporations or foundations.
“Today’s plea of Michele Bergantino is another example of IRS-Criminal Investigation’s (CI) dedication to bringing individuals to justice who engage in helping U.S. taxpayers evade their tax obligations,” said IRS-CI Chief Richard Weber. “We will continue our global efforts to vigorously pursue both U.S. taxpayers who avoid paying their fair share and the unscrupulous professionals who facilitate their actions. For those hiding cash or assets offshore, the time to come clean is now.”
Bergantino also admitted traveling to the United States approximately one to two times a year to meet with clients, taking careful steps to conceal the purpose of his visits from U.S. law enforcement. He used private couriers to send clients’ account statements to the U.S. hotels where he stayed, so that he would not be caught traveling with clients’ statements in his possession. In addition, Bergantino obtained “travel” account statements for each client he intended to visit which were devoid of Credit Suisse’s logo and account or customer identification information and used business cards that Credit Suisse provided that contained only his name and office number and did not carry the Credit Suisse name or logo. On entering the United States, Bergantino provided misleading information regarding the nature and purpose of his visit to U.S. Customs and Border Protection authorities.
In addition to assisting customers in evading their U.S. taxes, Bergantino also provided illegal advice to U.S. customers regarding investments in U.S. securities. Neither Bergantino nor Credit Suisse were registered with the U.S. Securities and Exchange Commission and both U.S. law and Credit Suisse policy prohibited Bergantino and other Credit Suisse employees from providing investment advice in the United States. Nevertheless, Credit Suisse management pressured its employees, including Bergantino, to make sales in the United States.
Two of Bergantino’s co-defendants, Andreas Bachmann and Josef Dörig, pleaded guilty to the superseding indictment in 2014 and were sentenced on March 27, 2015. Credit Suisse pleaded guilty in May 2014 for conspiring to aid and assist taxpayers in filing false returns and was sentenced in November 2014 to pay $2.6 billion in fines and restitution.
Bergantino faces a statutory maximum sentence of five years in prison. He also faces monetary penalties and restitution.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Boente commended special agents of IRS-Criminal Investigation, who investigated the case and Senior Litigation Counsel Mark F. Daly and Trial Attorney Robert J. Boudreau of the Tax Division and Assistant U.S. Attorney Mark Lytle of the Eastern District of Virginia, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Former Swiss Banker Pleads Guilty to Tax FraudRead the Press Release
ALEXANDRIA, Va. – Michele Bergantino, 48, a citizen of Italy and a resident of Switzerland, pleaded guilty today to charges related to the aiding and assisting U.S. taxpayers in evading their income taxes during his employment as a banker working for Credit Suisse AG on its North American desk.
“Hiding assets and creating secret accounts in an attempt to evade income taxes is a losing game,” said Dana J. Boente, U.S. Attorney for the Eastern District of Virginia. “Today’s plea shows that we will continue to prosecute bankers and U.S. citizens who engage in this criminal activity. I want to thank our law enforcement partners and prosecutors for their work on this important case.”
According to the statement of facts filed with the plea agreement, Bergantino admitted that from 2002 to 2009, while working as a relationship manager for Credit Suisse in Switzerland, he participated in a wide-ranging conspiracy to aid and assist U.S. taxpayers in evading their income taxes by concealing assets and income in secret Swiss bank accounts. Bergantino oversaw a portfolio of accounts, largely owned by U.S. taxpayers residing on the West Coast, which grew to approximately $700 million of assets under management. Bergantino admitted that the tax loss associated with his criminal conduct was more than $1.5 million but less than or equal to $3.5 million.
“Mr. Bergantino is now the third fugitive to come to the United States and plead guilty to charges in this case,” said Caroline D. Ciraolo, Acting Assistant Attorney General of the Justice Department’s Tax Division. “To those who have actively assisted U.S. taxpayers in using offshore accounts to evade taxes, the message is clear: staying outside the United States will provide little comfort. We will investigate and charge you, and will work relentlessly to hold you to account for your actions.”
During his time as a relationship manager, Bergantino assisted many U.S. clients in utilizing their Credit Suisse accounts to evade their U.S. income taxes and to facilitate concealment of the U.S clients’ undeclared financial accounts from the U.S. Treasury Department and the Internal Revenue Service (IRS). Among the steps taken by Bergantino to assist clients in hiding their Swiss accounts were the following: assuring them that Swiss bank secrecy laws would prevent Credit Suisse from disclosing their undeclared accounts to U.S. law enforcement; by discussing business with clients only when they traveled to Zurich to meet him; structuring withdrawals from their undeclared accounts by sending multiple checks, each in amounts below $10,000, to clients in the United States; facilitating the withdrawal of large sums of cash by U.S. customers from their Credit Suisse accounts at Credit Suisse offices in the Bahamas, in Switzerland, particularly the Credit Suisse branch at the Zurich airport and at a financial institution in the United Kingdom; holding clients’ mail from delivery to the United States; issuing withdrawal checks from Credit Suisse’s correspondent bank in the United States; and taking actions to remove evidence of a U.S. client’s control over an account because the U.S. client intended to file a false and fraudulent income tax return. Moreover, Bergantino understood that a number of his U.S. clients concealed their ownership and control of foreign financial accounts by holding those accounts in the names of nominee tax haven entities, or structures, which were frequently created in the form of foreign partnerships, trusts, corporations or foundations.
“Today’s plea of Michele Bergantino is another example of IRS-Criminal Investigation’s (CI) dedication to bringing individuals to justice who engage in helping U.S. taxpayers evade their tax obligations,” said Richard Weber, Chief of IRS-Criminal Investigation. “We will continue our global efforts to vigorously pursue both U.S. taxpayers who avoid paying their fair share and the unscrupulous professionals who facilitate their actions. For those hiding cash or assets offshore, the time to come clean is now.”
Bergantino also admitted to traveling to the United States approximately one to two times per year to meet with clients, taking careful steps to conceal the purpose of his visits from U.S. law enforcement. He used private couriers to send clients’ account statements to the U.S. hotels where he stayed, so that he would not be caught traveling with clients’ statements in his possession. In addition, Bergantino obtained “travel” account statements for each client he intended to visit which were devoid of Credit Suisse’s logo and account or customer identification information and used business cards that Credit Suisse provided that contained only his name and office number and did not carry the Credit Suisse name or logo. On entering the United States, Bergantino provided misleading information regarding the nature and purpose of his visit to U.S. Customs and Border Protection authorities.
In addition to assisting customers in evading their U.S. taxes, Bergantino also provided illegal advice to U.S. customers regarding investments in U.S. securities. Neither Bergantino nor Credit Suisse were registered with the U.S. Securities and Exchange Commission and both U.S. law and Credit Suisse policy prohibited Bergantino and other Credit Suisse employees from providing investment advice in the United States. Nevertheless, Credit Suisse management pressured its employees, including Bergantino, to make sales in the United States.
Two of Bergantino’s co-defendants, Andreas Bachmann and Josef Dörig, pleaded guilty to the superseding indictment in 2014 and were sentenced on March 27, 2015. Credit Suisse pleaded guilty in May 2014 for conspiring to aid and assist taxpayers in filing false returns and was sentenced in November 2014 to pay $2.6 billion in fines and restitution.
Bergantino faces a maximum penalty of five years in prison when sentenced on September 23. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia, Caroline D. Ciraolo, Acting Assistant Attorney General of the Justice Department’s Tax Division, and Richard Weber, Chief of IRS-Criminal Investigation, made the announcement after the plea was accepted by U.S. District Judge Gerald Bruce Lee. Assistant U.S. Attorney Mark Lytle and Senior Litigation Counsel Mark F. Daly and Trial Attorney Robert J. Boudreau of the Tax Division are prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:11-cr-95.
Former Nurse Sentenced to 82 Months for Stealing and Tampering with Patient MedicationsRead the Press Release
ALBANY, NEW YORK – Nathan Baum, age 31, of East Greenbush, New York, was sentenced today to serve 82 months in prison after admitting to stealing pain medication intended for hospice patients.
The announcement was made by United States Attorney Richard S. Hartunian; Special Agent in Charge Jeffrey G. Hughes of the U.S. Department of Veterans Affairs Office of Inspector General, Northeast Field Office; and Acting Special Agent in Charge Russell J. Hermann of the U.S. Food and Drug Administration Office of Criminal Investigations, New York Field Office.
Senior United States District Judge Lawrence E. Kahn also imposed a three-year term of supervised release, to begin after Baum’s release from prison, and a $2,000 fine.
Baum pled guilty in February to tampering with a consumer product and obtaining controlled substances by deception and subterfuge. Baum, a licensed practical nurse who worked at the hospice ward of the Veterans Affairs Medical Center, in Albany, improperly accessed syringes that contained oxycodone hydrochloride. These syringes were stored in locked containers that Baum was able to access using his individually assigned password. Between April 8, 2014 and May 16, 2014, Baum removed the oxycodone hydrochloride from at least 25 syringes and replaced it with haloperidol.
Oxycodone hydrochloride, a Schedule II controlled substance, is a highly addictive narcotic analgesic used to treat moderate to severe pain. Haloperidol, often marketed as Haldol, is an anti-psychotic medication used to treat certain mental/mood disorders and to treat uncontrolled movements or agitation.
Family members of some of the hospice patients attended today’s sentencing, and several gave statements detailing the pain and suffering that Baum inflicted on dying hospice patients and their families.
U.S. Attorney Richard S. Hartunian stated: “The victims in this case were military veterans, including veterans of World War II and the Korean War. They fought for and served our country, and eventually became hospice patients who trusted Nathan Baum to give them the medication they needed in the final moments of their lives. Baum violated that trust by stealing their medication and replacing it with anti-psychotic medicine that would not have eased his patients’ pain. This was a terrible crime, and Baum has received a sentence reflecting his betrayal of the nursing profession and the Department of Veterans Affairs.”
Jeffrey G. Hughes, Special Agent in Charge of the VA Office of Inspector General’s Northeast Field Office, said: “The VA OIG is committed to pursuing those who would do harm to our deserving veterans and bringing those individuals to justice. We will continue to diligently pursue fraud, waste and abuse in every form as it so negatively affects our nation’s heroes. We would also like to commend the Stratton VA Medical Center for its prompt actions and notification to our office.”
Russell J. Hermann, Acting Special Agent in Charge of the FDA Office of Criminal Investigations’ New York Field Office, said: “Our office will continue to pursue those who prey on our most vulnerable patients, those in hospice, by removing their needed medications. We will continue our efforts to protect the public health and bring to justice those would compromise patients’ health and comfort in this manner.”
Baum’s tampering was discovered in late May 2014, when his supervisor noticed that he was slurring his speech and his pupils were pinpoint – signs of controlled substance abuse. When federal agents inspected the locked container Baum was allowed to access, they found that three sets of oxycodone hydrochloride syringes had been tampered with. Baum admitted to agents that he was addicted to painkillers; that he used oxycodone hydrochloride that was intended for veterans; and that he replaced the oxycodone hydrochloride in some syringes with Haldol.
This case was investigated by the U.S. Department of Veterans Affairs Office of Inspector General and the Food and Drug Administration Office of Criminal Investigations, and was prosecuted by Assistant U.S. Attorney Elizabeth R. Rabe.
Former Manchester Tax Preparer Sentenced for Filing False Tax ReturnsRead the Press Release
CONCORD, N.H. – Okello Odongo, 36, of Snellville, Georgia, was sentenced to 18 months in prison and ordered to pay $34,822 in restitution to the IRS for filing 19 false tax returns and fraudulently obtaining tax refunds reports United States Attorney Emily Gray Rice.
Odongo is a former resident of Manchester, New Hampshire, where he operated a tax return preparation business called Tax Smart Solutions Co. As a tax preparer, Odongo was authorized by the IRS to file tax returns electronically for his customers. One of the forms he filed electronically was an Allocation of Refund Form that instructed the IRS to directly deposit refunds into specified bank accounts. The form allowed a refund to be allocated to two or more bank accounts.
In 2011 and 2012 Odongo filed false tax returns on behalf of some of his customers that fraudulently overstated the amounts of the tax refunds they were entitled to claim. Odongo also filed Allocation of Refund Forms that directed the IRS to electronically deposit the fraudulent portions of the refunds to bank accounts Odongo held or had access to. None of Odongo’s customers knew that he used their doctored tax returns as a vehicle to defraud the IRS.
This case was investigated by the Internal Revenue Service, Criminal Investigations. It was prosecuted by Assistant United States Attorney Mark S. Zuckerman.
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Former MCC Construction Company Officer and Owner Pleads Guilty to Conspiring to Obstruct Government ProceedingRead the Press Release
Thomas Harper, a former officer and owner of MCC Construction Company (MCC), pleaded guilty today to conspiring to obstruct justice before the Small Business Administration (SBA). Harper also agreed to pay restitution in the amount of $165,711, the Department of Justice announced today.
The plea was announced by Principal Deputy Assistant Attorney General Renata Hesse of the Justice Department’s Antitrust Division; U.S. Attorney Channing D. Phillips of the U.S. Attorney’s Office for the District of Columbia; Assistant Director in Charge Paul M. Abbate of the FBI’s Washington Field Office; Inspector General Peggy E. Gustafson of the Small Business Administration (SBA); Inspector General Carol Fortine Ochoa of the U.S. General Services Administration (GSA); Special Agent in Charge Brian J. Reihms of the Central Field Office of the Defense Criminal Investigative Service (DCIS), and Director Frank Robey of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (MPFU).
“Today's guilty plea ensures that the defendant does not profit from his crimes,” said Principal Deputy Assistant Attorney General Hesse. “The Antitrust Division will continue to work with our colleagues at the US Attorney's Office and in law enforcement to expose and punish schemes like this that defraud taxpayers and legitimate small business owners.”
“This prosecution and the broader investigation that led to these charges demonstrate the resolve of law enforcement to protect the integrity of federal contracting rules meant to assist small, disadvantaged businesses,” said U.S. Attorney Phillips. “We are committed to ensuring that the benefits of this important government program go only to those companies that truly are socially and economically disadvantaged and deserving of the work.”
“The FBI will aggressively investigate those who seek to profit by fraudulently competing for government contracts intended for small businesses,” said Assistant Director in Charge Abbate. “I want to thank the dedicated FBI special agents and analysts, as well as our partner agencies, for their hard work in protecting fair federal contracting opportunities for socially and economically disadvantaged businesses in our community.”
“Fraudulently passing work through eligible small businesses to a large business does not provide taxpayers the best value and certainly does not support the role of small businesses as engines of economic development and job creation,” said SBA Inspector General Gustafson. “In fact, it subverts the purpose of SBA’s preferential contracting programs and harms the small businesses the programs are designed to assist. I want to thank the U.S. Attorney’s Office and our law enforcement partners for their leadership and dedication to serving justice.”
“This fraudulent scheme deceived taxpayers and deprived legitimate small businesses of lucrative contracts,” said GSA Inspector General Ochoa. “We are committed to rooting out such exploitative conduct.”
“The Defense Criminal Investigative Service is committed to working with our partner agencies to combat fraud impacting the Department of Defense's vital programs and operations and maintain the integrity of the procurement system,” said Special Agent in Charge Reihms.
“There is an absolute need and purpose to assist small and disadvantaged businesses in the contracting process,” said Director Robey. “Special Agents from Army CID will continue to work closely with our law enforcement partners to make every contribution possible to bring persons to justice who violate that purpose.”
Harper, 46, of Colchester, Connecticut, was charged in a criminal information on June 6, 2016, in the U.S. District Court for the District of Columbia, with one count of conspiring to obstruct proceedings before a department or agency. He waived the requirement of being charged by way of federal indictment, agreed to the filing of the information, and accepted responsibility for his criminal conduct. The charge carries a statutory maximum of five years in prison and potential financial penalties. According to the government’s calculations, Harper could face a potential range of 10 to 16 months in prison under federal sentencing guidelines. The Honorable Ketanji Brown Jackson scheduled a status hearing in the case for Sept. 20, 2016.
According to court documents, MCC and others conspired with two companies that were eligible to receive federal government contracts set asides for small, disadvantaged businesses with the understanding that MCC would, illegally, perform all of the work. In so doing, MCC was able to win 27 government contracts worth over $70 million from 2008 to 2011. The scope and duration of the scheme resulted in a significant number of opportunities lost to legitimate small and disadvantaged businesses.
Court documents state that in one of these contracts, the GSA contracting officer filed a protest with the SBA, claiming that one of the companies was other than a small business because of its relationship with MCC. The SBA opened a proceeding to determine whether MCC’s bid on behalf of one of the companies violated SBA rules and regulations. Harper and others took steps to corruptly influence, impede, and obstruct the SBA size determination protest by willfully and knowingly making false statements to the SBA about the extent and nature of the relationship between MCC and one of the companies.
Court documents also state that MCC violated the provisions of the SBA 8(a) program. The SBA 8(a) development program is designed to award contracts to businesses that are owned by “one or more socially and economically disadvantaged individuals.” To qualify for the 8(a) program, a business must be at least 51 percent owned and controlled by a U.S. citizen (or citizens) of good character who meet the SBA’s definition of socially and economically disadvantaged. The firm must also be a small business (as defined by the SBA) and show a reasonable potential for success. Participants in the 8(a) program are subject to regulatory and contractual limits. Also, under the program, the disadvantaged business is required to perform a certain percentage of the work. For the types of contracts under investigation here, the SBA 8(a)-certified companies were required to perform 15 percent or more of the work with its own employees.
Earlier this year, MCC pleaded guilty to conspiring to commit fraud on the United States by illegally obtaining government contracts that were intended for small, disadvantaged businesses and agreed to pay $1,769,924 in criminal penalties and forfeiture.
The investigation is being conducted by the FBI’s Washington Field Office, the Inspector General for the Small Business Administration (SBA), the Inspector General of the U.S. General Services Administration (GSA), the Central Field Office of the Defense Criminal Investigative Service (DCIS), and the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (MPFU).
The prosecution is being handled by Assistant U.S. Attorney Matt Graves and John Marston of the U.S. Attorney’s Office for the District of Columbia and Assistant Chief Craig Y. Lee and Trial Attorneys Kevin B. Hart and Justin P. Murphy of the Antitrust Division.
Former MCC Construction Company Officer and Owner Pleads Guilty to Conspiring to Obstruct Government ProceedingRead the Press Release
WASHINGTON – Thomas Harper, a former officer and owner of MCC Construction Company (MCC), pled guilty today to conspiring to obstruct justice before the Small Business Administration (SBA). Harper also agreed to pay restitution in the amount of $165,711.
The plea was announced by U.S. Attorney Channing D. Phillips of the U.S. Attorney’s Office for the District of Columbia; Principal Deputy Assistant Attorney General Renata Hesse of the Justice Department’s Antitrust Division; Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office; Peggy E. Gustafson, Inspector General for the Small Business Administration (SBA); Carol Fortine Ochoa, Inspector General of the U.S. General Services Administration (GSA); Brian J. Reihms, Special Agent in Charge of the Central Field Office of the Defense Criminal Investigative Service (DCIS), and Frank Robey, Director of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (MPFU).
“This prosecution and the broader investigation that led to these charges demonstrate the resolve of law enforcement to protect the integrity of federal contracting rules meant to assist small, disadvantaged businesses,” said U.S. Attorney Phillips. “We are committed to ensuring that the benefits of this important government program go only to those companies that truly are socially and economically disadvantaged and deserving of the work.”
“Today's guilty plea ensures that the defendant does not profit from his crimes,” said Principal Deputy Assistant Attorney General Hesse. “The Antitrust Division will continue to work with our colleagues at the U.S. Attorney’s Office and in law enforcement to expose and punish schemes like this that defraud taxpayers and legitimate small business owners.”
“The FBI will aggressively investigate those who seek to profit by fraudulently competing for government contracts intended for small businesses,” said Assistant Director in Charge Abbate. “I want to thank the dedicated FBI special agents and analysts, as well as our partner agencies, for their hard work in protecting fair federal contracting opportunities for socially and economically disadvantaged businesses in our community.”
“Fraudulently passing work through eligible small businesses to a large business does not provide taxpayers the best value and certainly does not support the role of small businesses as engines of economic development and job creation. In fact, it subverts the purpose of SBA’s preferential contracting programs and harms the small businesses the programs are designed to assist,” said SBA Inspector General Gustafson. “I want to thank the U.S. Attorney’s Office and our law enforcement partners for their leadership and dedication to serving justice.”
“This fraudulent scheme deceived taxpayers and deprived legitimate small businesses of lucrative contracts,” said GSA Inspector General Ochoa. “We are committed to rooting out such exploitative conduct.”
“The Defense Criminal Investigative Service is committed to working with our partner agencies to combat fraud impacting the Department of Defense's vital programs and operations and maintain the integrity of the procurement system," said Special Agent in Charge Reihms.
“There is an absolute need and purpose to assist small and disadvantaged businesses in the contracting process," said Director Robey, "Special Agents from Army CID will continue to work closely with our law enforcement partners to make every contribution possible to bring persons to justice who violate that purpose."
Harper, 46, of Colchester, Conn., was charged in a criminal information on June 6, 2016, in the U.S. District Court for the District of Columbia, with one count of conspiring to obstruct proceedings before a department or agency. He waived the requirement of being charged by way of federal indictment, agreed to the filing of the information, and accepted responsibility for his criminal conduct. The charge carries a statutory maximum of five years in prison and potential financial penalties. According to the government’s calculations, Harper could face a potential range of 10 to 16 months in prison under federal sentencing guidelines. The Honorable Ketanji Brown Jackson scheduled a status hearing in the case for Sept. 20, 2016.
According to court documents, MCC and others conspired with two companies that were eligible to receive federal government contracts set asides for small, disadvantaged businesses with the understanding that MCC would, illegally, perform all of the work. In so doing, MCC was able to win 27 government contracts worth over $70 million from 2008 to 2011. The scope and duration of the scheme resulted in a significant number of opportunities lost to legitimate small and disadvantaged businesses.
Court documents state that in one of these contracts, the GSA contracting officer filed a protest with the SBA, claiming that one of the companies was other than a small business because of its relationship with MCC. The SBA opened a proceeding to determine whether MCC’s bid on behalf of one of the companies violated SBA rules and regulations. Harper and others took steps to corruptly influence, impede, and obstruct the SBA size determination protest by willfully and knowingly making false statements to the SBA about the extent and nature of the relationship between MCC and one of the companies.
Court documents also state that MCC violated the provisions of the SBA 8(a) program. The SBA 8(a) development program is designed to award contracts to businesses that are owned by “one or more socially and economically disadvantaged individuals.” To qualify for the 8(a) program, a business must be at least 51% owned and controlled by a U.S. citizen (or citizens) of good character who meet the SBA’s definition of socially and economically disadvantaged. The firm must also be a small business (as defined by the SBA) and show a reasonable potential for success. Participants in the 8(a) program are subject to regulatory and contractual limits. Also, under the program, the disadvantaged business is required to perform a certain percentage of the work. For the types of contracts under investigation here, the SBA 8(a)-certified companies were required to perform 15 percent or more of the work with its own employees.
Earlier this year, MCC pleaded guilty to conspiring to commit fraud on the United States by illegally obtaining government contracts that were intended for small, disadvantaged businesses and agreed to pay $1,769,924 in criminal penalties and forfeiture.
The investigation is being conducted by the FBI’s Washington Field Office, the Inspector General for the Small Business Administration (SBA), the Inspector General of the U.S. General Services Administration (GSA), the Central Field Office of the Defense Criminal Investigative Service (DCIS), and the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (MPFU).
The prosecution is being handled by Assistant U.S. Attorney Matt Graves and John Marston of the U.S. Attorney’s Office for the District of Columbia and Assistant Chief Craig Y. Lee and Trial Attorneys Kevin B. Hart and Justin P. Murphy of the Antitrust Division.
Former Hancock County, West Virginia, sheriff deputy charged with use of excessive forceRead the Press Release
WHEELING, WEST VIRGINIA – A former Hancock County, West Virginia, Sheriff’s Deputy has been charged with using excessive force against an arrestee, United States Attorney William J. Ihlenfeld, II, announced.
Mark A. Cowden, 51, of Weirton, WV, was indicted by a federal grand jury on one count of “Deprivation of Rights” and one count of “Obstruction of Justice – Falsification of Document.” Cowden is alleged to have used excessive force during an arrest in January of 2015 and to have falsified a document in an attempt to justify his use of force.
Cowden faces up to ten years in prison and a fine up to $250,000 for the deprivation of rights charge and up to twenty years in prison and a fine up to $250,000 for the obstruction charge.
Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Jarod J. Douglas and Department of Justice Civil Rights Trial Attorney Nicholas Murphy are handling the case on behalf of the government. The Federal Bureau of Investigation is investigating.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.Former Fugitive Sentenced to 96 Months in Prison for Embezzling $8.7 Million from EmployerRead the Press Release
CINCINNATI – James T. Hammes, 54, formerly of Lexington, Kentucky, was sentenced in U.S. District Court today to 96 months in prison. Hammes pleaded guilty in October 2015 to one count of wire fraud and agreed to pay nearly $7.7 million in restitution, specifically, approximately $6.7 million to G & J Pepsi-Cola Bottlers, Inc. and $1 million to Cincinnati Insurance Company.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the sentence handed down today by U.S. District Judge Susan J. Dlott.
According to court documents, from about 1998 through February 2009, Hammes embezzled more than $8.7 million from his employer, G & J Pepsi-Cola Bottlers, Inc., a large, privately held manufacturer and distributor of Pepsi products that is headquartered in Cincinnati.
Hammes served as a controller for the company, and was responsible for all financial accounting and internal controls for his division, including supervising accounts payable to vendors for services provided to the company’s division.
The defendant set up phantom vendor accounts and manipulated monthly accounting reports, using a miscellaneous account to charge off fraudulent checks and then manipulating legitimate accounts to offset the amounts carried in the miscellaneous account.
The stolen money that Hammes invested and traded generated IRS 1099 forms. Hammes voluntarily made estimated tax payments to the IRS totaling at least $2.7 million using the funds that he stole from his employer. Despite making the estimated tax payments, he failed to file tax returns for multiple tax years.
Hammes was questioned about the issuance of possible fraudulent checks in February 2009, at which time he fled and spent the majority of six years as a fugitive hiking the Appalachian Trail and living under an alias, which belonged to a real person. Federal criminal charges were filed against Hammes and he was arrested in Virginia in May 2015, following a tip from a hiker who had seen the defendant’s story on television.
“Hammes embezzled a lot of money over a long period of time,” Acting U.S. Attorney Glassman said. “As the district court recognized, his scheme was sophisticated; he abused the trust that his employer had placed in him; and sheer greed motivated him. Hammes followed up his crime by coldly abandoning his family without explanation or warning and running from the law for six years under someone else's name. But no one can run from justice forever, and today his lies were punished. Hammes more than earned every minute of the term of imprisonment that the district court imposed today.”
Acting U.S. Attorney Glassman commended the cooperative investigation by the FBI Cincinnati Division, with assistance from FBI- Richmond Division, FBI- Indianapolis Division, Internal Revenue Service – Criminal Investigation, and the U.S. Marshal’s Service, as well as Deputy Criminal Chief Emily N. Glatfelter and Criminal Chief Kenneth L. Parker, who are prosecuting the case.
Former Employee of Environmental Consulting Firm Sentenced for Bank FraudRead the Press Release
ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that EILEEN JOANNE CRUZ QUITUGUA, age 31, was sentenced today by Chief Judge Frances Tydingco-Gatewood of the District Court of Guam to serve 30 months in federal prison, and five years of supervised release, and to pay $159,735.76 in restitution and a $400 special assessment fee. Defendant QUITUGUA pled guilty on December 3, 2015, to four counts of bank fraud in violation of Title 18, United States Code, Section 1344.
In her plea agreement, QUITUGUA admitted that from October 2011 to January 2014, she embezzled $159,735.76 from her employer Allied Pacific Environmental Consulting (APEC). APEC hired her as its bookkeeper and she was responsible for preparing checks drawn on the company’s checking accounts maintained at First Hawaiian Bank. QUITUGUA forged the signatures of the company owner and other authorized personnel on 221 company checks that totaled $159,735.76. She wrote payroll checks for herself and checks ostensibly for petty cash, and used the stolen funds for her personal benefit.
U.S. Attorney Limtiaco stated “The U.S. Attorney’s Office and its law enforcement partners are committed to investigating and prosecuting those who victimize and perpetrate fraud against members of our community, including businesses and financial institutions.”
This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Marivic David.
Five Columbus, Ohio residents charged with transporting stolen goodsRead the Press Release
WHEELING, WEST VIRGINIA – A federal grand jury returned an indictment charging Maurice L. Whyte, II, 23, Kasie A. Morgan, 24, Kionte K. Whatley, 19, Marilyn Whatley, 37, and Jolisha McDonald, 25, all of Columbus, Ohio, with transporting stolen goods, United States Attorney William J. Ihlenfeld, II, announced.
From January 2014 through June 2015, all five individuals allegedly conspired with one another to steal primarily smart phones, tablets, head phones, games stations, and computers from Walmart, Target, and Meijer stores in eight different states, including West Virginia and Ohio. The value of the stolen goods are estimated to be in excess of $500,000.
Whyte, Morgan, Kionte Whatley, Marilyn Whatley, and McDonald are each charged with one count of “Conspiracy to Transport Stolen Goods in Interstates Commerce.” Whyte, Morgan, Marilyn Whatley, and McDonald are also each charged with two counts of “Interstate Transportation of Stolen Property.” They face up to five years in prison and a fine up to $250,000 for the conspiracy charge and up to ten years in prison and a fine up to $250,000 for each of the interstate transportation of stolen property charges. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Robert H. McWilliams, Jr. is prosecuting the case on behalf of the government. The Federal Bureau of Investigation and the Columbus, Ohio Police Department are investigating.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
Fifteen Charged in Middle District as Part of Largest National Health Care Fraud Takedown in HistoryRead the Press Release
Tampa, FL – United States Attorney A. Lee Bentley, III, 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 our nation’s health care programs is a top priority of our Office,” said U.S. Attorney Bentley. “We are committed to prosecuting all those who submit false claims to these important programs, whether they be health care providers or dishonest individuals seeking benefits to which they are not entitled. Every tax dollar appropriated by Congress for health care should be spent on deserving patients in need.”
In the Middle District of Florida, 15 individuals were charged with participating in a variety of schemes, including compound pharmacy fraud and intravenous prescription drug fraud involving millions in fraudulent billing. Among those charged are business owners, a registered nurse, a pharmacist, and a physician’s assistant.
“Health care providers and patients are key to protecting the Medicare and Medicaid programs, but when they instead choose to commit fraud or to lie in order to obtain government benefits they are not entitled to, they steal precious tax dollars and corrupt the integrity of our health care system,” said Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health & Human Services Office of Inspector General (HHS OIG). "This takedown reflects the dedication of OIG and our law enforcement partners to bring such fraudsters to justice."
“The Social Security Office of the Inspector General is committed to pursuing those who violate the public’s trust by stealing SSA benefits. We are pleased with the aggressive action by the U.S. Attorney’s Office and our law enforcement partners’ joint efforts in identifying and prosecuting those who commit fraud, as one of our many efforts to protect the integrity of Social Security and Medicare programs for those who rely on them now and into the future,” stated Special Agent-in-Charge Margaret Moore-Jackson, SSA/Office of the Inspector General.
"These arrests highlight the commitment of the Defense Criminal Investigative Service (DCIS) and its law enforcement partners to protect the integrity of the Department of Defense (DoD) health care program-Tricare," said Special Agent in Charge John F. Khin, Southeast Field Office. "DCIS aggressively investigates health care providers that defraud the DoD, to preserve American taxpayer dollars intended to care for our Warfighters, their family members, and military retirees."
“Despite recent challenging events occurring in our territory, FBI Tampa remained devoted to dedicating resources to the National Health Care Fraud initiative,” stated FBI Special Agent in Charge Paul Wysopal. “Agents will continue to identify and investigate individuals who seek to personally benefit from the medical needs of a very vulnerable population.”
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 agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS, SSA-OIG, 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.
Middle District of Florida Cases
Yosbel Marimon (39, Winter Park), owner of several Orlando-area infusion clinics, was indicted on one charge of conspiracy to commit health care fraud and wire fraud, six counts of health care fraud, and one count of conspiracy to commit money laundering. The charges stem from her role in a scheme to defraud Medicare by billing for more than $11.1 million in expensive intravenous prescription drugs that the clinics never purchased, never administered, and were not medically necessary. As a result of the scheme, Medicare paid over $8.6 million in fraudulent claims.
Greggory Jackson (40, Eagle Lake), Dustin “Drey” Chennells (40. Mount Dora), Michael Ayotunde (53, Ocala), Tashima Kenny (32, Davenport), Iris Ayala (54, Clermont), and Nalita Rajkumar (28, Lake Park) were indicted on a charge of conspiracy to commit health care fraud and wire fraud. Jackson also was indicted on two charges of receiving illegal kickbacks, two charges of paying illegal kickbacks, and two counts of money laundering. Kenny was also indicted on one count of money laundering. Jackson, Chennells, Kenny, and others managed and operated a telemarketing call center known as DMA Logistics d/b/a Nation Wide Meds located inside Life Worth Living Pharmacy. Ayotunde, a licensed pharmacist, is the owner and operator of Life Worth Living Pharmacy. Ayala is a licensed physician, and Rajkumar is a licensed physician assistant. The charges stem from these individuals’ roles in a compounding pharmacy fraud scheme that victimized the TRICARE program. Based on false and fraudulent claims, TRICARE made more than $5.7 million in reimbursement payments to Life Worth Living Pharmacy.
Belinda Jalloh (60, New Port Richey), a registered nurse, has been charged with one count of theft of government services stemming from her violation of an order from the Department of Health and Human Services excluding her from participating in the Medicare program. The order prohibited her from treating Medicare beneficiaries. Despite the exclusion, she applied for, and obtained, employment at a facility that billed Medicare for her treatment of Medicare beneficiaries.
Robert Lee Lanier (57, Jacksonville) has been charged with one count of theft of government property and one count of making a false statement. Lanier provided false information regarding his employment to the Social Security Administration. Between 2007 and January 2016, Lanier collected more than $236,682 in Social Security and Medicare benefits to which he was not entitled.
Maria Lugo (65, Marion County) was indicted for theft of government funds stemming from her concealment of her living arrangements while simultaneously collecting disability benefit payments from the Social Security Administration. Lugo falsely claimed a separation from her husband, whose income rendered her ineligible to receive disability benefits and Medicaid. From June 2000 through May 2016, Lugo obtained $118,346.12 in SSA benefit payments and $99,483.62 in Medicaid utilization that she was not entitled to receive.
Janice and Thurman Hammock (66 and 62, Citrus County) were indicted for theft of government funds stemming from their concealment of their living arrangements while Janice Hammock collected disability benefit payments from the Social Security Administration. Both spouses falsely claimed to be separated from one another, causing the wife to receive substantially more federal benefits than otherwise permitted. She illegally obtained $75,048.89 in SSA benefit payments and $101,465.07 in Medicaid utilization from January 2004 through May 2016.
Louis William Rimondi, IV (47, Marco Island) was indicted on two charges of theft of government money stemming from his alleged concealment from the Social Security Administration and Medicare of his return to gainful employment while continuing to collect disability benefits and Medicare benefits. From January 2010 through February 2016, Rimondi fraudulently collected $101,466 in SSA disability benefits to which he was not entitled. From January 2011 through February 2016, he also fraudulently received $20,467 in Medicare benefits to which he was not entitled.
Douglas Thompson (51, Jacksonville) was indicted on one count of theft of government property, one count of making a false statement, and three counts of wire fraud stemming from his role in a scheme to fraudulently receive approximately $108,834 in benefits under the Federal Medicaid Health Care Benefit Program and the Supplemental Security Income Program. For more than five years, Thompson collected benefits by falsely claiming he was unemployed and had no income when, in fact, he operated a business, Douglas Thompson Industries Inc. (or DTI Inc.), which brokered the sale of trucking equipment. When questioned about DTI Inc., Thompson provided a written statement to the Social Security Administration that falsely stated that he had never heard of DTI Inc. and was not working.
Craig DeMange, Sr. (62, Oviedo) was indicted on one count of making a false statement to the Social Security Administration concerning his employment, which hindered the agency’s efforts to determine his continued eligibility for disability benefits. As a result of DeMange’s false statement, he defrauded the SSA and the United States Department of Health and Human Services of approximately $25,000 in disability and Medicare benefits.
These cases will be prosecuted by Middle District of Florida Assistant United States Attorneys Yolande G. Viacava, Emily C.L. Chang, William S. Hamilton, Michael J. Coolican, Mac Heavener, and Department of Justice Trial Attorneys Timothy Loper and Christopher Hunter of the Criminal Division’s Fraud Section.
Maximum Penalties per charge:
Theft of Government Money: 10 years in federal prison.
Conspiracy to Commit Healthcare Fraud and Fraud: 20 years in federal prison.
Healthcare Fraud: 10 years in federal prison.
Conspiracy to Commit Money Laundering: 20 years in federal prison.
Money Laundering: 10 years in federal prison.
False Statement: 5 years in federal prison.
Wire Fraud: 20 years in federal prison.
Federal Court Prohibits Florida Tax Preparer from Preparing Tax Returns for OthersRead the Press Release
A federal court in Tampa, Florida, has permanently barred a Bradenton, Florida, man from preparing federal tax returns for others, the Justice Department announced today.
In April, the United States filed a civil complaint against Guy Riston Paul, individually and doing business as G7 Financial Enterprises & More, G7 Accounting and Tax Services and Voltaire Multi-Services. Paul, who is currently serving a three-year prison term for engaging in the preparation of false tax returns and for failing to report income he earned from his tax preparation business, consented to entry of the injunction, but he did not admit the allegations in the United States’ complaint.
According to the civil complaint, Paul prepared federal income tax returns for customers that overstated his customers’ refunds by taking the identities of dependents from customers who were not U.S. citizens and claiming them on the tax returns of his U.S. citizen customers. Paul used this scheme to claim improper Earned Income Tax Credits and Child Tax Credits, the complaint alleges. Paul also allegedly claimed other false credits, such as the education tax credit, on his customers’ returns.
Return preparer fraud is one of the Internal Revenue Service’s (IRS) Dirty Dozen Tax Scams for 2016. The IRS has some tips on its website for choosing a tax preparer and has launched a free directory of federal tax preparers. In the past decade, the Justice Department’s Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers and tax scheme promoters. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Fairmont man pleads guilty to federal firearm chargeRead the Press Release
CLARKSBURG, WEST VIRGINIA – Joshua Cline, 23, of Fairmont, WV, pled guilty to a federal firearm charge today, United States Attorney William J. Ihlenfeld, II, announced.
Cline was found in possession of a 9mm caliber pistol in Marion County, West Virginia. Cline used that firearm in furtherance of his marijuana distribution operation.He pled guilty today to one count of “Possession of Firearm in Furtherance of Drug Trafficking Crime.” He faces up to five years in prison and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Zelda E. Wesley prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Three Rivers Drug Task Force investigated.U.S. District Judge Irene M. Keeley presided.
Executive Director Charged with Embezzling from Charity to Fund Home Renovations and Personal ExpensesRead the Press Release
Earlier today, a federal grand jury sitting in Brooklyn returned an indictment charging Yolanda Vitulli, the executive director of a charity that provides services to individuals with developmental disabilities, with embezzling approximately $100,000 from the charity for her personal use.
The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York, Diego Rodriguez, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and New York State Inspector General Catherine Leahy Scott.
As is alleged in the indictment, between January 2001 and May 2016, Vitulli served as the Executive Director of Tender Care Human Services Inc. (Tender Care), a not-for-profit social service provider based in Queens, New York, that provided services to individuals with autism and other development disabilities throughout the New York City metropolitan area. Tender Care received approximately $3 million in federal and New York State Medicaid funding each year to provide the services.
The government’s investigation revealed that between 2009 and May 2014, Vitulli embezzled Tender Care funds to pay housekeepers to clean her residence, do laundry, and provide childcare. Additionally, between January 2012 and November 2013, Vitulli used Tender Care funds to hire a contractor to perform work at her residence, including purchasing and installing a hot tub, fence, furniture, and security cameras.
“The embezzlement of public funds meant to benefit members of our communities most in need of assistance is a serious crime,” stated United States Attorney Capers. “With this indictment, we serve notice that those who engage in such conduct will be vigorously investigated and prosecuted by this Office.” Mr. Capers extended his grateful appreciation to the United States Department of Labor, Office of the Inspector General, for its assistance.
“The very definition of charity is to give to those in need. Instead, the subject in this case decided the $100,000 she’s accused of stealing would be better spent making her life easier. Theft is a crime, but to take from those who are in need of help makes this case more egregious,” stated FBI Assistant Director-in-Charge Rodriguez.”
“The defendant allegedly stole public funds meant for the developmentally disabled in order to subsidize her own life of luxury,” said New York State Inspector General Leahy Scott. “This indictment should serve as warning to any officers and agents of charitable providers who exploit taxpayer funds intended for critical public services; they will be identified, apprehended, and prosecuted to the fullest extent of the law. I will continue to work closely with my state and federal law enforcement partners to pursue and hold accountable anyone who attempts to defraud the public welfare system and the people it serves.”
The charge in the indictment is merely an allegation, and the defendant is presumed innocent unless and until proven guilty. If convicted of embezzling public funds, the defendant faces a maximum sentence of ten years’ imprisonment.
The government’s case is being prosecuted by Assistant United States Attorneys Robert Polemeni and Nathan Reilly.
The Defendant:
YOLANDA VITULLI
Age: 52
Mohnton, PennsylvaniaE.D.N.Y. Docket No. 16-CR-344
Egegik Man Indicted by Federal Grand Jury for Drug TraffickingRead the Press Release
Anchorage, Alaska – U.S. Attorney Karen L. Loeffler announced today that a Egegik man has been charged with possessing with the intent to distribute over 500 grams or more of methamphetamine.
Jason Corey Vincent Alto, 20, of Egegik, Alaska, was charged with possessing nearly three pounds of methamphetamine while traveling on the Alaska Marine Highway System M/V Kennicott. Alto was traveling from Washington to Whittier, Alaska, when he was contacted in Ketchikan and a search of his luggage revealed methamphetamine. Alto was subsequently arrested on State charges and is currently in custody in Ketchikan.
According to Assistant U.S. Attorney Jack S. Schmidt, who presented the case to the grand jury, the law provides for a mandatory minimum sentence of 10 years to a maximum of up to life in prison, a fine of up to $10,000,000.
The United States Coast Guard Investigative Service and the Alaska State Troopers Drug Unit conducted the investigation leading to the indictment in this case.
An indictment is only a charge and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.
Eagle Butte Man Sentenced for LarcenyRead the Press Release
United States Attorney Randolph J. Seiler announced that an Eagle Butte, South Dakota, man convicted of larceny was sentenced on June 20, 2016, by U.S. District Judge Roberto A. Lange.
Sage Nelson, age 29, was sentenced to time served, 2 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Nelson was indicted for Larceny by a federal grand jury on December 8, 2015. He pled guilty on March 29, 2016.
The conviction stems from a June 19, 2015, incident when Nelson stole a pickup truck that was parked in front of the Eagle Bar in Eagle Butte. The owner had left the keys in the vehicle while he went inside to visit with his brother. Acting on a report from Nelson’s girlfriend, law enforcement located the vehicle and a Corson County deputy conducted a felony (high-risk) traffic stop about 76 miles from where the vehicle was stolen. Nelson was the driver and lone occupant of the vehicle. His BAC was .156 and several open containers were recovered from the interior of the vehicle.
This case was investigated by the Cheyenne River Sioux Tribe Law Enforcement Services, the Corson County Sheriff’s Department, the Mobridge City Police Department, the Walworth County Sheriff’s Department, the Bureau of Indian Affairs, Standing Rock Agency, and the Federal Bureau of Investigation. Assistant U.S. Attorney Jay Miller prosecuted the case.
Downtown Newark Heroin and Oxycodone Dealer Pleads Guilty to Drug Distribution Conspiracy, Firearms OffenseRead the Press Release
NEWARK, N.J. – A Newark man today admitted distributing large quantities of heroin and oxycodone in and around downtown Newark, U.S. Attorney Paul J. Fishman announced today.
Lamont Vaughn a/k/a “Mont,” a/k/a “True V,” 33, pleaded guilty before U.S. District Judge Jose L. Linares in Newark federal court to Count One and Count Fourteen of an indictment charging him with conspiracy to distribute 100 grams or more of heroin and oxycodone and being a felon in possession of a firearm.
According to documents filed in this case and statements made in court:
Between August 2012 and August 7, 2013, Vaughn conspired with others to distribute large quantities of heroin and oxycodone out of a downtown Newark clothing store called Ballas Boutique. Over the course of the conspiracy, Vaughn and others sold drugs out of Ballas Boutique to a confidential source more than 35 times. The majority of the sales were audio and video recorded.
Additionally, law enforcement intercepted conversations of Vaughn and his conspirators pursuant to court orders. The intercepted conversations revealed that Vaughn had multiple employees who sold drugs for him at Ballas Boutique. The intercepted conversations further revealed that Vaughn had multiple, established sources of supply for heroin and oxycodone.
On Aug. 7, 2013, law enforcement officers executed arrest and search warrants at Ballas Boutique and at Vaughn’s home in Newark. Among the items recovered from Vaughn’s bedroom were dozens of oxycodone pills, two firearms, and a large amount of cash.
Under the terms of today’s plea agreement – which has been accepted by the court – Vaughn will be sentenced to 65 months in prison and up to five years of supervised release. Sentencing is scheduled for Oct 5, 2016.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Timothy Gallagher in Newark, as well as the N.J. State Police Street Gangs North Unit with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorneys Margaret Ann Mahoney and Francisco J. Navarro of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: Lamont Vaughn, Pro SeDisbarred Atlantic Beach Attorney Sentenced for EmbezzlementRead the Press Release
Jacksonville, Florida – Senior United States District Judge Henry Lee Adams, Jr. has sentenced William Reid Penuel (38, Ponte Vedra Beach) to six months in federal prison, followed by three years of supervised release, for embezzlement from a bankruptcy estate. While on supervised release, Penuel must serve six months of home detention, and participate in ongoing drug testing and treatment. He was also ordered to pay $151,239 in restitution.
On March 15, 2016, Penuel pleaded guilty to embezzlement. According to the Florida Bar, in April 2016, he was disbarred from practicing law.
According to court records, between March 2015 and July 2015, Penuel was serving as the Chapter 7 Trustee in a pending business bankruptcy case in Tallahassee when he embezzled estate funds held in a bank account in Duval County. At the time, he was a licensed attorney whose office was located in Atlantic Beach. After becoming the Chapter 7 Trustee for the debtor, Penuel assumed responsibility for approximately $909,000 in estate funds, which he deposited into his bank account. Penuel began diverting estate funds, which had been authorized by the bankruptcy court to pay certain expenses, to his own use. As the authorized signor on the estate bank account, Penuel made withdrawals and then re-deposited the monies into other accounts that he controlled. Once the funds were placed into his operating account, Penuel withdrew the funds. The scheme involved approximately 20 withdrawals from the estate bank account, totaling approximately $151,239.
This case was investigated by the Federal Bureau of Investigation - Jacksonville Office. It was prosecuted by Assistant United States Attorney Dale Campion.
Delaware County Podiatrist Charged with $5 Million Health Care Fraud SchemeRead the Press Release
PHILADELPHIA – Stephen A. Monaco, D.P.M., 59, of Broomall PA was charged by criminal information, unsealed today, in connection with a $5 million scheme to defraud Medicare, Medicaid and four private victim insurance companies, announced United States Attorney Zane David Memeger. The information alleges that Dr. Monaco committed the fraud through his practice, A Foot Above Podiatry, Inc. (“A Foot Above”), located in Havertown PA.
According to the information, between January 2008 and October 31, 2014, Dr. Monaco submitted fraudulent claims to Medicare, Medicaid and four private victim insurance companies for podiatric procedures that were not provided, and podiatric procedures that were not performed, including injections, debridement (removal of dead, infected or foreign material to promote wound healing) and nail avulsions (removal of the entire or partial nail plate). In addition, according to the information, Dr. Monaco submitted fraudulent claims to Medicare, Medicaid and four private victim insurance companies for medically unnecessary procedures and services that were not reimbursable by Medicare or the other insurance carriers. In total, it is alleged that the defendant caused the submission of fraudulent claims to Medicare, Medicaid and the four private victim insurance companies that resulted in payments by the victim insurers to the defendant’s practice totaling approximately $5 million.
If convicted, defendant Monaco faces up to 10 years in prison, $5 million restitution, substantial fines, and criminal forfeiture.
The case was investigated by the Federal Bureau of Investigation, the Department of Health and Human Services Office of the Inspector General, the Drug Enforcement Administration, the Office of Personnel Management Office of the Inspector General, and the United States Railroad Retirement Board Office of Inspector General. It is being prosecuted by Assistant United States Attorneys M. Beth Leahy and Jennifer B. Jordan.
Cuban National Pleads Guilty to Wire Fraud ChargeRead 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 Yasser Carrillo Chartrand, 24, a citizen of Cuba legally present in the United States, pleaded guilty before U.S. District Court Judge Richard J. Arcara, to conspiracy to commit wire fraud. The charge carries a maximum penalty of 20 years in prison, and a fine of $250,000.
Assistant U.S. Attorney Russell T. Ippolito, Jr., who is handling the case, stated that Chartrand is one of six defendants arrested in a credit card scheme. Eduardo Hernandez Quinones, Claudia Diaz Diaz, Yaily Santurio Milian, Jose Valdivia Quinones and Misael Toledo Rios have all been convicted and sentenced for their involvement in the scheme.
The six defendants conspired to obtain the credit/debit card numbers of actual people and then encoded counterfeit cards with the information. The defendants then used the counterfeit cards to purchase merchandise at retail stores including a Tops Market in Amherst, NY and a CVS Pharmacy in Buffalo, NY, and gas stations throughout Western New York. The gasoline that was purchased with counterfeit credit cards was re-sold for cash.
Today’s plea is the result of an investigation by Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent in Charge James C. Spero, the U.S. Secret Service, under the direction of Special Agent in Charge C. Todd Laster, and the New York State Police, under the direction of Major Steven Nigrelli.
Sentencing is scheduled for September 28, 2016 at 12:30 p.m. before Arcara.Crawford County Woman to Federal Prison for Meth ConspiracyRead the Press Release
A woman who conspired to distribute methamphetamine was sentenced June 21, 2016, to five years in federal prison.
Katja Bails, 36, from Kiron, Iowa, received the prison term after a July 17, 2015, guilty plea to conspiracy to distribute methamphetamine.
At the guilty plea, Bails admitted that from about 2012 and continuing through November 2014 she was involved in a conspiracy that distributed more than 5,000 grams of actual (pure) methamphetamine. Bails traveled periodically from the Denison, Iowa, area to Omaha, Nebraska to obtain large quantities of methamphetamine which she then distributed in the Denison and Ida Grove, Iowa areas.
Bails was sentenced in Sioux City by United States District Court Judge Mark W. Bennett. Bails was sentenced to 60 months’ imprisonment. A special assessment of $100 was imposed. She must also serve a five-year term of supervised release after the prison term. There is no parole in the federal system.
Bails is being held in the United States Marshal’s custody until she can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Iowa Division of Narcotics Enforcement, Ida County Sheriff’s Office, Denison Police Department, and Iowa Division of Criminal Investigation.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 14-4086.
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Couple Agree to Plead Guilty to more than $1 Million in Health Care FraudRead the Press Release
COLUMBUS, Ohio – Riyad Altallaa, 51, and Muna Alnoubani, 49, both of Hilliard, each agreed to plead guilty in U.S. District Court to conspiracy to commit health care fraud.
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 300 individuals, including 61 doctors, nurses and other 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.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio, Lamont Pugh, Special Agent in Charge, Department of Health and Human Services Office of Inspector General, Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, Ohio Attorney General Mike DeWine and Kathy Enstrom, Special Agent in Charge, Internal Revenue Service (IRS) Criminal Investigation, announced the pleas filed today.
According to court documents, Altallaa and Alnoubani were owners of Columbus Home Health Care Services, LLC. The couple executed a fraud scheme in order to minimize expenses and maximize profits by fabricating aide training records to avoid the time and expense of training and to give the appearance that aides had completed the required training and were prepared to provide home health services to Medicare and Medicaid beneficiaries.
The defendants also had aides and nurses submit blank time sheets and nursing notes that the defendants completed with falsely inflated hours of service.
Finally, they had aides and nurses “split” their shifts on their timesheets and nursing notes to make it appear that services were provided in multiple shifts rather than one shift. Under Medicaid’s reimbursement policy, the initial hour of each shift is reimbursed at a rate that is approximately double the rate of subsequent hours.
Altallaa and Alnoubani each agreed to plead guilty to one count of conspiracy to commit health care fraud. Altallaa also agreed to plead guilty to one count of money laundering. Each crime carries a potential maximum sentence of 10 years in prison.
The couple used the fraud money to build a luxurious, $1 million home in Hilliard. As part of the plea agreements, they will forfeit that home.
“The detection, investigation and prosecution of individuals and entities who engage in committing criminal acts of fraud in the home health care arena, whether it be the Medicare or Medicaid program, is a top priority for the OIG” said Lamont Pugh III, Special Agent in Charge, U.S. Department of Health & Human Services, Office of Inspector General – Chicago Region. “The OIG will continue to work with our law enforcement partners to protect taxpayer dollars and ensure that perpetrators of these fraud schemes are held accountable.”
Including today’s enforcement actions, nearly 1,200 individuals have been charged in national 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 sweep, and they accounted for 82 defendants charged in this effort.
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 Ohio, 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.
Acting U.S. Attorney Glassman commended the investigation of this case by the FBI, HHS-OIG Ohio Attorney General’s Medicaid Fraud Control Unit and IRS Criminal Investigation, as well as Assistant United States Attorney Kenneth Affeldt and Special Assistant United States Attorney Maritsa Flaherty, who are representing the United States in this case.
Convicted Sex Offender Sentenced to 94 Months in Prison for Sexually Abusing a Child While Failing to Register as a Sex OffenderRead the Press Release
WASHINGTON – Andre Hammond, 35, of Washington, D.C., has been sentenced to 94 months in prison for sexually abusing a female child and committing a crime of violence while failing to register as a sex offender, announced U.S. Attorney Channing D. Phillips and Michael Hughes, U.S. Marshal for the Superior Court of the District of Columbia.
Hammond pled guilty in September 2014, in the U.S. District Court for the District of Columbia, to one count of failure to register as a sex offender and one count of commission of a crime of violence while failing to register as a sex offender, in violation of the Sex Offender Registration and Notification Act (SORNA). He also pled guilty to one count of second-degree child sexual abuse. He was sentenced on June 21, 2016, by the Honorable Ketanji Brown Jackson. Following his prison term, Hammond will be placed on 20 years of supervised release.
Hammond has one prior misdemeanor conviction, in 2009, in the District of Columbia for a sex offense involving a different minor female victim, which requires him to register as a sex offender. According to the government’s evidence, he initially registered in the District of Columbia but soon moved to Maryland and did not register his new address with the District of Columbia Sex Offender Registry or with any Maryland registry. In 2011, Hammond moved from Maryland back to the District, but continued to falsely register a District of Columbia address where he was not actually residing. While failing to properly register as a sex offender in the District of Columbia, Hammond then committed a new sex offense involving a child who he repeatedly molested over the course of almost four years. He was arrested in October 2013.
As part of an overall strategy to combat child exploitation, the U.S. Marshals Service launched a nationwide operation to target sex offenders who violate SORNA by knowingly failing to comply with their sex offender registration requirements. SORNA is part of the Adam Walsh Child Protection and Safety Act of 2006. The Adam Walsh Act also provides for the use of federal law enforcement resources, including the U.S. Marshals Service, to assist states in locating and apprehending non-compliant sex offenders.
In announcing the sentence, U.S. Attorney Phillips and U.S. Marshal Hughes praised the work of Senior Inspector Floriano Whitwell and other members of the D.C. Superior Court Sex Offender Investigations Section of the U.S. Marshals Service, who investigated the case. They also expressed appreciation for the work of those who handled the case at the U.S. Attorney’s Office, including Paralegal Specialist Donhue Troy Griffith, Victim/Witness Advocate Elsa Maltese, Forensic Child Interviewer Karen Giannakoulias, and Criminal Investigator John Marsh. Finally, they commended the work of former Assistant U.S. Attorney Heide Herrmann and Assistant U.S. Attorney Sarah McClellan, who prosecuted the case.
Charleston heroin dealer sentenced to Federal prison for drug crimeRead the Press Release
CHARLESTON, W.Va. – A Charleston man was sentenced to a year and nine months in federal prison for a heroin crime, announced Acting United States Attorney Carol Casto. Justin Randolph, 27, previously entered his guilty plea to distribution of heroin.
Randolph admitted that on January 15, 2015, he sold heroin to a confidential informant working with the Kanawha County Sheriff’s Office. The drug deal took place in the Kroger parking lot in Dunbar.
The Kanawha County Sheriff’s Office, the Metropolitan Drug Enforcement Network Team, and the West Virginia State Police conducted the investigation. Assistant United States Attorney John J. Frail is handling the prosecution. United States District Judge Thomas E. Johnston imposed the sentence.
This case was 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 prescription drugs 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 illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of pills and heroin in communities across the Southern District.
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Champaign Roofer Charged with Immigration ViolationsRead the Press Release
Springfield, Ill. – The owner of Gire Roofing, Inc., and its corporate parent, Grayson Enterprises, Inc., of Champaign, Ill., have been charged on multiple federal immigration violations. Edwin J. Gire made his initial appearance in federal court in Springfield on June 21, 2016, before U.S. District Judge Sue E. Myerscough. A trial date of Aug. 2, 2016, is scheduled for Gire and Grayson Enterprises, doing business as Gire Roofing, Inc., in Springfield.
On June 8, 2016, a federal grand jury returned the 10-count indictment that charges Gire with visa immigration fraud (four counts), harboring illegal aliens (three counts), and unlawful employment of aliens (three counts). The indictment also charges Grayson Enterprises, Inc. in eight of the ten counts and seeks forfeiture of the Gire Roofing property located at 309 West Hensley Road in Champaign, Ill., which is alleged to have been used to facilitate the commission of the offenses.
The indictment alleges that in March 2011, August 2011, March 2013, and April 2014, Gire submitted petitions to the U.S. Department of Labor and to the U.S. Department of Homeland Security to obtain foreign workers to perform roofing work in Champaign County and Douglas County, Ill. The indictment further alleges that to support the need for workers, Gire submitted contracts that he knew were false with the petitions, causing the State Department to issue H-2B non-immigrant worker visas to more than 150 foreign workers.
The indictment further alleges that from 2008 to 2014, Gire engaged in a practice and pattern of knowingly hiring unauthorized aliens, and in 2014, harbored those same illegal aliens in Champaign County, Ill., for the purpose of commercial advantage and private financial gain.
If convicted, each count of visa fraud and harboring illegal aliens carries a penalty of up to ten years in prison and a $250,000 fine. The unlawful employment of aliens charges carry a penalty of up to six months imprisonment and a maximum fine of $3,000 for each unauthorized alien employed.
The charges are the result of investigation by the U.S. Department of State, Diplomatic Security Service; the U.S. Department of Labor, Office of Inspector General; U.S. Immigration and Customs Enforcement Homeland Security Investigations; and, the Internal Revenue Service, Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorney Eugene L. Miller.
Members of the public are reminded that an indictment is merely an accusation; the defendant is presumed innocent unless proven guilty.
Buffalo Man Pleads Guilty to Stealing Funds Intended for Buffalo SchoolsRead 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 Hassan El Saddique, 36, of Amherst, NY, pleaded guilty to theft of money in control and possession of a bank before Senior U.S. District Judge William M. Skretny. The misdemeanor charge carries a maximum penalty of one year in prison and a $100,000 fine.
Assistant U.S. Attorney Richard A. Resnick, who is handling the case, stated that between June 2009 and October 2010, the defendant made it appear that he had entered into a contract for consultant services with the Buffalo Board of Education. The alleged contract falsely stated that El Saddique would perform services at the Universal School. The defendant never provided services at the school.
At the beginning of the 2009-2010 school year, El Saddique did begin assisting with the Title I Program at Bishop Timon High School. These services were performed voluntarily and without pay.
However, between October 2009 and October 2010, the defendant submitted 19 fraudulent invoices to the Buffalo Board of Education for payment for services that were never performed or done voluntarily at the Universal School and Bishop Timon high School. El Saddique received 18 checks totaling $15,120 and retained a portion of those funds.
On June 1, 2016, the defendant’s mother, Debbie Buckley, was convicted of theft of government funds. Buckley served as Supervisor of Title I, Office of Federal and State Programs for the Buffalo School District. Title I is a federally funded program that provides assistance to school districts with high numbers of children from low income families. In March 2010, Buckley was promoted to Assistant Superintendent of Federal and State Programs.
Buckley changed the approval process by which a contractor was paid for Title I services provided in non-public schools. She eliminated the need for a signature from an official at the non-public school. Buckley did this so that she could sign the fraudulent invoices submitted by her son authorizing the payment of the invoices. The dates of some of these invoices coincide with the period during which Buckley was promoted to Assistant Superintendent.Today’s 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 and the U.S. Department of Education, Office of Inspector General, under the direction of Assistant Special Agent in Charge Geoff Wood.
Sentencing is scheduled for October 26, 2016 at 11:00 a.m. before Judge Skretny.
Brownsburg man arrested on terrorism chargesRead the Press Release
18 year old attempted to travel to the Middle East in material support of ISIL
PRESS RELEASE
Indianapolis – United States Attorney Josh J. Minkler and FBI Special Agent in Charge W. Jay Abbott of the FBI’s Indiana Division announced today the arrest of a Brownsburg, Indiana, man on charges of providing material support to the Islamic State of Iraq and the Levant (ISIL). Akram Musleh, age18, was arrested by FBI agents while attempting to board a bus from Indianapolis to New York where he was to fly to and transit through Morocco to ISIL-controlled territory. The criminal complaint alleges that from there, he was to provide material support by joining ISIL.
“The radicalization of American citizens by terrorist organizations like ISIL is a threat to our safety here and abroad,” said Minkler. “I am committed to using the full authority of the United States Attorney’s Office to identify, investigate and prosecute those that materially support terrorism. I would like to thank the Federal Bureau of Investigation, the Brownsburg Police Department and the Indianapolis Metropolitan Police Department for working with us during this investigation. We will continue to work closely with our law enforcement partners but as in this case, we rely heavily on the public’s assistance to help make our community safe.”
“Terrorism is the FBI’s number one priority and we work closely with our law enforcement partners to ensure the safety of our community,” said Abbott. “This case demonstrates the value of law enforcement collaboration and community engagement.”
A criminal complaint is only a charge and not evidence of guilt. All defendants are presumed innocent until proven otherwise in federal court.
According to Assistant United States Attorneys Bradley Shepard and Doris Pryor who are prosecuting this case for the government, Musleh faces a maximum sentence of 20 years in prison, a lifetime of supervised release and a $250,000 fine if convicted.
Brandon Woman Arrested for Medicaid Fraud During National TakedownRead the Press Release
The Office of the United States Attorney for the District of Vermont announced that Misti Baker, 36, of Brandon, Vermont, was arrested today as part of a national healthcare fraud takedown. U.S. Magistrate Judge John M. Conroy ordered Baker detained pending a detention hearing on June 24, 2016.
On June 8, 2016, a federal grand jury in Rutland returned an indictment charging Baker with health care fraud. According to the indictment, Baker defrauded the State of Vermont’s Children’s Personal Care Services (CPCS) program. CPCS, which is jointly funded by federal and Vermont Medicaid dollars, is designed to provide supplemental assistance with self-care and activities of daily living to Medicaid-eligible children with significant disabilities or health conditions. Three of Baker’s children qualified for the CPCS program. The indictment alleges that Baker submitted false time sheets and diverted funds for her own use, rather than obtaining supplemental assistance for her children. The indictment charges Baker with submitting false time sheets and fraudulently diverting approximately $77,306.57 in health care funds.
The United States Attorney emphasized that the charges in the indictment are merely accusations and that the defendant is presumed innocent unless and until she is proven guilty. If convicted, Baker faces up to ten years’ imprisonment, and a fine of up to $250,000. The actual sentence would be determined with reference to federal sentencing guidelines.
Baker was arrested today as part of a nation-wide initiative to combat health care fraud. Over 30 federal districts, from Alaska to Florida, unveiled charges against approximately 300 defendants who participated in a variety of schemes which involved more than $900 million of fraud. The national initiative is described more fully in a press release issued by the Department of Justice earlier today and available at https://www.justice.gov/opa/pr/national-health-care-fraud-takedown-results-charges-against-301-individuals-approximately-900.
United States Attorney, Eric S. Miller, commended the investigative efforts of the Department of Health and Human Services Office of Inspector General, Boston Regional Office, and the Vermont Medicaid Fraud Control Unit. Miller added, “Health care fraud is not an abstract or victimless crime. The defendants pursued by the Department of Justice and the Department of Health and Human Services in this operation have allegedly enriched themselves by stealing taxpayer money designated to help people who are most in need.”
The United States is represented in this case by Assistant U.S. Attorney Jonathan Ophardt. Baker is represented by Christopher L. Davis, Esq. of Langrock, Sperry, & Wool, LLP.
Bergen County, New Jersey, Woman Admits Role in Cocaine Trafficking ConspiracyRead the Press Release
NEWARK, N.J. – A Bergenfield, New Jersey, woman today admitted her role in a conspiracy to traffic approximately two kilograms of cocaine from Puerto Rico to New Jersey, U.S. Attorney Paul J. Fishman announced.
Sasha Melendez, 37, pleaded guilty before U.S. District Judge Claire C. Cecchi in Newark federal court to an information charging her with one count of conspiring to distribute cocaine.
According to documents filed in this case and statements made in court:
Melendez was the subject of an investigation by the U.S. Postal Inspection Service and the Drug Enforcement Administration (DEA) of an ongoing conspiracy to import cocaine from Puerto Rico. She was arrested on March 24, 2015 in Bergen County after she accepted delivery of a mail parcel from Puerto Rico containing approximately two kilograms of cocaine. Melendez admitted today that she conspired with co-defendant Ramis Esteves, 33, of New York, to distribute the cocaine.
The conspiracy charge to which Melendez pleaded guilty today carries a maximum potential penalty of 20 years in prison and $1 million fine. Sentencing is scheduled for Oct. 4, 2016.
The charge and allegations against Esteves are merely accusations, and he is presumed innocent unless and until proven guilty.
U.S. Attorney Fishman credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Cynthia L. Shoffner, and special agents of the DEA, under the direction of Special Agent in Charge Carl J. Kotowski, with the investigation.
The government is represented by Assistant U.S. Attorney Jonathan M. Peck of the U.S. Attorney’s Office General Crimes Unit.
Defense Counsel: Stacey Van Malden, Esq.
Bath Resident Charged with Attempting to Transfer Obscene Material to a MinorRead the Press Release
Contact: Craig M. Wolff
Assistant United States Attorney
Tel: (207) 780-3257Portland, Maine: United States Attorney Thomas E. Delahanty II announced today that Garrett G. Brosnan, 25, of Bath, Maine, was arrested yesterday and charged in U.S. District Court by criminal complaint with attempting to transfer obscene material to a minor.
According to court records, on two occasions earlier this month, Brosnan sent obscene material to an individual who he believed to be a 14-year-old girl. In fact, the recipient of the material was an agent with U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI).
The defendant will make an initial appearance in the U.S. District Court in Portland today.
He faces up to 10 years in prison and a $250,000 fine.
This case was investigated by HSI.
A criminal complaint is merely an accusation and a defendant is presumed innocent unless proven guilty in a court of law.
Arsonist of BLC Automotive Sentenced to More Than 5 Years in Federal PrisonRead the Press Release
Jacksonville, Florida – U.S. District Judge Timothy J. Corrigan has sentenced Steven Villareal (30, Jacksonville) to five years and three months in federal prison for the arson of BLC Automotive on Blanding Boulevard. He was also ordered to pay BLC Automotive restitution in the amount of $30,000. Villareal pleaded guilty on February 29, 2016.
According to court documents, on February 17, 2014, Villareal entered BLC Automotive at approximately 3:00 a.m. Once inside, he used an acetylene torch to cut into a safe from which he stole a large sum of cash. He then used an accelerant to start a fire inside the business. An officer from the Jacksonville Sheriff’s Office saw the fire and alerted the Jacksonville Fire and Rescue Department, who responded quickly and extinguished the fire. The interior of BLC Automotive was badly damaged, but the structure survived the fire.
This case was investigated by the Jacksonville Sheriff’s Office, the State Fire Marshal, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant United States Attorney Frank Talbot.
Armstrong County Woman Pleads Guilty to Stealing Money from Greeting CardRead the Press Release
PITTSBURGH –A former Armstrong County resident pleaded guilty in federal court to a charge of theft of mail, United States Attorney David J. Hickton announced today.
April Kovach, age 40, formerly of Yatesboro, Pa., pleaded guilty to one count before Senior United States District Judge Gustave Diamond.
In connection with the guilty plea, the court was advised that on or about Oct. 8, 2014, Kovach, a then-highway contract route driver for the U.S. Postal Service in Kittanning, did abstract and remove two $20 Federal Reserve notes that had been the contents of a greeting card envelope addressed to an individual in Cranberry Township.
Judge Diamond scheduled sentencing for Oct. 19, 2016, at 10 a.m. The law provides for a total sentence of five years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Shardul S. Desai is prosecuting this case on behalf of the government.
The United States Postal Service – Office of Inspector General conducted the investigation that led to the prosecution of Kovach.
Alexandria woman pleads guilty to stealing deceased grandmother’s Social Security benefitsRead the Press Release
ALEXANDRIA, La. – United States Attorney Stephanie A. Finley announced that a woman from Alexandria pleaded guilty Monday to stealing more than $36,000 in Social Security benefits.
Keyoka Jynes, 36, of Alexandria, pleaded guilty before U.S. District Judge Dee D. Drell to one count of theft of government property. According to the guilty plea, Jynes stole $36,442 of supplemental Social Security income benefits from April 2008 until December 2013. Jynes did not notify the Social Security Administration (SSA) that her grandmother died in March 2008 and continued to receive her SSA benefits through 2013.
Jynes faces up to 10 years in prison, three years supervised release, a $250,000 fine and restitution. A sentencing date of September 26, 2016 was set.
The Social Security Administration, Office of Inspector General, conducted the investigation. Assistant U.S. Attorney James G. Cowles Jr. is prosecuting the case.
After UBS Produces Singapore-Based Documents, Justice Department Dismisses Summons CaseRead the Press Release
UBS AG has complied with an Internal Revenue Service (IRS) summons for bank records held in its Singapore office, the Justice Department announced today. Because UBS has now produced all Singapore-based records responsive to the request and the IRS determined that UBS complied with the summons, the Justice Department has voluntarily dismissed its summons enforcement action against the bank.
The IRS served an administrative summons on UBS for records pertaining to accounts held by Ching-Ye “Henry” Hsiaw. According to the petition, the IRS needed the records in order to determine Hsiaw’s federal income tax liabilities for the years 2006 through 2011. Hsiaw transferred funds from a Switzerland-based account with UBS to the UBS Singapore branch in 2002, according to the declaration of a revenue agent filed at the same time as the petition. UBS refused to produce the records, and the United States filed its petition to enforce the summons.
“The Department of Justice and the IRS are committed to making sure that offshore tax evasion is detected and dealt with appropriately,” said Acting Assistant Attorney General Caroline D. Ciraolo of the Tax Division. “One critical component of that effort is making sure that the IRS has all of the information it needs to audit taxpayers with offshore assets. In this case, we filed a petition to enforce a summons for offshore documents, but that’s only one of the tools we have available for gathering information. Taxpayers with offshore assets who underreported their income should come forward before we come looking for them.”
The Tax Division aggressively pursues offshore tax evasion. More information is available online about the Division’s Offshore Compliance Initiative and its Swiss Bank Program.
22 Defendants Named in Health Care Fraud Cases involving over $161 Million in Fraudulent Bills to Government Health Care ProgramsRead the Press Release
LOS ANGELES – Culminating investigations by a host of state and federal law enforcement agencies, federal prosecutors have brought 13 criminal cases that charge a total of 22 defendants in health care fraud schemes. Several medical professionals were charged as part of the sweep, including five physicians, a psychiatrist, one pharmacist and an occupational therapist. The cases announced today allege various schemes that led to more than $161 million in fraudulent bills being submitted to publicly funded health care programs such as Medicare and TRICARE.
The cases filed in federal court in Los Angeles and Santa Ana are part of a nationwide sweep announced today in Washington by Attorney General Loretta Lynch, who said criminal and civil charges have been filed against 301 individuals who allegedly participated in health care fraud schemes involving approximately $900 million in false billings. The local cases were filed by Assistant United States Attorneys and Trial Attorneys with the Justice Department’s Medicare Fraud Strike Force.
“Health care fraud is a serious offense that costs Americans billions of dollars, and the cases announced today here in Los Angeles alone cost taxpayers more than $100 million,” said United States Attorney Eileen M. Decker. “These crimes affect real people and erode the trust that should exist between a patient and their health care provider. The entire Justice Department and our law enforcement partners are committed and determined to doing everything it takes to ensure the health care system works for the American public – and not those, whether health care providers or others, who seek to abuse the system.”
The cases filed in the Southland involve actual losses of more than $125 million, with the bulk of those losses associated with five cases related to schemes involving compounding pharmacies. In schemes orchestrated by marketers (sometimes called “cappers”), compounding pharmacies were provided with large numbers of prescriptions, generally for pain medications, that carried huge reimbursements, often more than $15,000 for each prescription. The prescriptions were written by doctors who received kickbacks from marketers or from “telemedicine” websites that had little or no contact with patients. The prescriptions were written for “patients” who, in many cases, did not want the prescriptions, had never met the prescribing doctors or had no idea why they were receiving the medications. In many cases, the beneficiary information was being used without the knowledge of the “patients” until the prescriptions showed up at their homes.
TRICARE, the military’s managed care program, was the primary victim of schemes involving the compounding pharmacies. Over the course of just a few years, TRICARE paid hundreds of millions of dollars for medications dispensed to “patients” across the nation, typically creams that supposedly would treat minor pain, scars, erectile dysfunction or “general wellness.” Five of the cases announced today relate to compounding pharmacies and allege losses of more than $100 million, most of which was paid by TRICARE over the course of just a few months.
In one case, John Garbino, a marketer who resides in Dana Point, was charged with receiving illegal kickbacks after referring prescriptions to compounding pharmacies that filled the prescriptions and billed TRICARE. One Palmdale pharmacy allegedly received more than $46 million from TRICARE in only six months. Another pharmacy in Corona received nearly $6 million over the same six-month period. Garbino allegedly received illegal kickbacks of as much as 65 percent for referring prescriptions to the compounding pharmacies. The criminal complaint against Garbino alleges that one of the pharmacies dramatically increased its claims to TRICARE “for filling compounded medications prescriptions that had been specially formulated to achieve the highest possible reimbursement rates rather than the greatest medical efficacy.”
In another scheme, the Florida-based operator of a “telemedicine” website was charged with health care fraud for allegedly misusing the identity and medical credentials of a physician to submit prescriptions to a compounding pharmacy. The criminal complaint in this case alleges that two local pharmacies received more than $6.5 million in payments from TRICARE in 2015.
In a third case, the owner of a La Mirada pharmacy, two marketers and a doctor were indicted on charges of paying and receiving illegal kickbacks. Health insurers paid the pharmacy, Valley View Drugs, more than $20 million, and the pharmacy paid nearly half of that to companies associated with the marketers.
“The Defense Criminal Investigative Service, 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 Special Agent in Charge Chris Hendrickson, DCIS Western Field Office. “Their actions threaten to cripple our vital national health care industry, and place our citizenry at risk. Over $100 million in Department of Defense health care funds that should have been used to treat the military and their families was instead allegedly stolen by swindlers. We will remain vigilant.”
“These arrests demonstrate that the U.S. Government will not tolerate fraud in the compounding pharmacy industry,” said Norbert E. Vint, the Acting Inspector General for the Office of Personnel Management, Office of Inspector General. “We appreciate the efforts of all the investigating agencies and the Department of Justice that have held these individuals accountable for their actions, and thereby protected taxpayer funded health care programs, including the Federal Employees Health Benefits Program.”
“The United States Postal Service, Office of Inspector General, along with our law enforcement partners will aggressively investigate those who engage in fraudulent activities intended to defraud federal benefit programs and the Postal Service,” said Special Agent in Charge Brian Washington, U.S. Postal Service, Office of Inspector General. “This week’s arrests should send a clear message to all health care providers that health care fraud is a federal crime that carries serious consequences and will not be tolerated.”
“Patients were pawns in an alleged pay-for-play fraud scheme,” said California Insurance Commissioner Dave Jones. “Patients should be able to trust that medications prescribed for them are based on their healthcare needs, not on payoffs and kickbacks to physicians and pharmacists.”
In other cases announced today, a doctor who had offices in Temecula and Mira Loma allegedly submitted nearly $12 million in fraudulent bills to Medicare for unnecessary “vein ablation” surgery. Another doctor was charged for helping the owner of a Granada Hills medical clinic, who recruited Medicare patients with promises of free equipment and used their beneficiary information to bill for services that simply were never provided.
“Medical professionals who seek to enrich themselves through Medicare fraud – such as exchanging illegal kickbacks or billing for medically unnecessary procedures – undermine this taxpayer-funded program and drive up health care costs for everyone,” said Special Agent in Charge Chris Schrank, of the U.S. Department of Health and Human Services, Office of Inspector General. “Today’s announcement shows our commitment to working with our state and federal law enforcement partners to swiftly investigate such allegations of fraud.”
Another case announced today charges three defendants in a scheme to defraud the health benefit plans established for members of the International Longshore and Warehouse Union and Federal Express employees. Participants in the scheme allegedly paid beneficiaries of those plans to undergo unnecessary sleep and nerve conduction velocity studies that were then billed to the plans. The defendants operated facilities in Sherman Oaks and San Pedro, where the testing was conducted as part of the fraud scheme that submitted at least $16 million in bills to the union and FedEx health plans. The defendants in this case also face money laundering charges.
“Those who commit fraud targeting health care funding get rich on the backs of American taxpayers who watch their premiums go up,” said Deirdre Fike, Assistant Director in Charge of the FBI’s Los Angeles Field Office. “Anyone who identifies suspicious billing practices or unlawful activity by a provider should contact a member of the Strike Force.”
“In the coming years, we will continue to leverage our financial skill set and focus on investigating those whose criminal activity drives up medical costs and jeopardizes a system that our citizens have come to trust,” stated IRS Criminal Investigation’s Acting Special Agent in Charge Anthony J. Orlando. “We will continue to work with our federal and state law enforcement partners to bring to justice those individuals who prey on the nation's health care system for their own personal greed.”
Most of the 22 defendants named in the cases were arrested on Monday and Tuesday. Several defendants self-surrendered after learning of the federal charges. A separate announcement details all 13 cases and the defendants charged in those cases.
Indictments and criminal information contain allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
The cases announced this week in Los Angeles are the result of investigations conducted by the United States Department of Health and Human Services, Office of Inspector General; the Defense Criminal Investigative Service; the Federal Bureau of Investigation; the Office of Personnel Management, Office of Inspector General; the Veterans Administration, Office of the Inspector General; the Department of Labor, Employee Benefits Security Administration; the California Department of Insurance, Fraud Division; the United States Postal Service, Office of the Inspector General; Amtrak’s Office of the Inspector General; the California Board of Pharmacy; IRS Criminal Investigation; and the California Department of Justice.
22 Charged in SDTX as Part of Largest National Medicare Fraud Takedown in HistoryRead the Press Release
HOUSTON – Attorney General Loretta E. Lynch and Department of Health and Human Services (DHHS) 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 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 largest multiple defendant takedown of those who were involved in large scale health care fraud against the USA sends a tremendous message to the public of our vigilance. Such wrongdoing will be uncovered and prosecuted,” said U.S. Attorney Kenneth Magidson. “These cases are part of our continuing effort to combat greed in our health care system, not only in the Houston metropolitan area, but also in our other offices in South Texas. We are committed to a sustained effort to continue to root out health care fraud.” In the Southern District of Texas (SDTX), the United States Attorney’s Office (USAO) and the Department of Justice Medicare Fraud Strike Force charged 22 individuals in 11 cases involving over $136 million in alleged fraud. One of these defendants is a physician with the highest number of referrals to home health services in the SDTX. Houston physician John Ramirez, 62, has been charged with participating in separate schemes to bill Medicare for medically unnecessary home health services that were often not provided. He is charged with four counts of conspiracy to commit health care fraud. In this $18 million Medicare fraud scheme, Ramirez allegedly authorized home-health services for Medicare beneficiaries when such services were not medically necessary, not provided by the home health agency or both. Medicare paid over $15 million to numerous companies that submitted claims to Medicare using the fraudulent home health referrals from the physician, according to the indictment. Also charged in this case is Susana Bermudez, 49, of Houston, the owner of Milten Clinic in Houston. She was indicted on one count of conspiracy to commit health care fraud for allegedly selling signed certifications to home health agencies. The agencies then would bill Medicare for purported home health services that were medically unnecessary, not provided, or both. In a separate but related case, Ramirez, Ann Sheperd, 60, of Houston, and Yvette Nwoko, 27, of Houston, were indicted on one count of conspiracy to commit health care fraud and three counts of health care fraud. The charges stem from their alleged roles in an $20 million Medicare fraud scheme. Sheperd was the owner and operator of Amex Medical, while Nwoko was the manager. The indictment alleges Shepherd and Nwoko would make it appear as if Medicare beneficiaries qualified for home health services when, in fact, the beneficiaries did not need the services. Shepherd allegedly paid doctors to sign false certifications. In return, Shepherd and Nwoko would sell the certifications to home health agencies, according to the charges. These agencies would then bill Medicare for home health services that were not necessary, not provided, or both. These cases are being jointly prosecuted by the USAO and the Strike Force. In another case prosecuted by the USAO, Gwendolyn Arnetta Gibbs aka Gwendolyn Arnetta Guidry, 64, of Missouri City, and Justina Obumnador Uzowulu, 55, are charged in a 20-count indictment for their participation in a $15 million health care fraud conspiracy. Gibbs is the owner and operator of Daybreak Rehabilitation Center. The indictment alleges he paid kickbacks to Uzowulu, who operates a group home in Houston, who would then bring her residents to Gibbs’ partial hospitalization program for group therapy. Gibbs could then bill Medicare for treatment, according to the indictment. Gibbs is also charged with billing group therapy sessions under a doctor who no longer worked at Daybreak. In McAllen, the owner of a Rio Grande Valley area durable medical equipment (DME) company and six others have been charged in a 16-count indictment for allegedly submitting false and fraudulent claims to Texas Medicaid for DME equipment that was not provided and/or was not authorized by a physician. Maria Garza, 41, of McAllen, is an owner of DME company Hacienda DME. Also charged were employees Bertha Lopez, 61, of Sullivan City, who served as a marketer and vendor for the company; Miriam Aguilar, 31, of Rio Grande City, a delivery driver and recruiter; and Nancy Rangel, 30, of Mission, who was a biller and recruiter. Veronica Cruz, 32, of Donna, Angelica Saenz, 44, of Mission, and Yolotzi Lara, 28, of Penitas, were charged for their roles as recruiters for Hacienda DME. According to the indictment, the defendants forged and/or caused others to forge the signatures of physicians on the required prescription forms. They also allegedly billed for larger, higher-paying sizes of pull-ups and diapers regardless of whether those sizes were needed or provided in order to receive higher reimbursements from Texas Medicaid. Further, the defendants also paid illegal kickbacks in exchange for patient information, according to the indictment. Additionally, the Strike Force has returned seven additional indictments and informations in the SDTX, charging nine more defendants in cases involving over $80 million. The operations announced today 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, DHHS-Office of Ispector General, Drug Enforcement Administration, Defense Criminal Investigative Service 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. An indictment or information is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law. ###100 Charged in Southern District of Florida as Part of Largest National Health Care Fraud Takedown in HistoryRead the Press Release
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, Attorney General Loretta E. Lynch, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Shimon R. Richmond, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), Norbert E. Vint, Acting Inspector General, U.S. Office of Personnel Management, Office of Inspector General (OPM-OIG), Pam Bondi, Florida Attorney General, George M. Karavetsos, Director, U.S. Food and Drug Administration’s (FDA) Office of Criminal Investigations (OCI), John F. Khin, Special Agent in Charge, Defense Criminal Investigative Service (DCIS) Southeast Field Office, Max Eamiguel, Special Agent in Charge, U.S. Postal Service, Office of Inspector General (USPS-OIG), Robert C. Hutchinson, Acting Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI), Miami Field Office, Diane J. Sabatino, Director, Field Operations, U.S. Customs and Border Protection (CBP), and Frank Robey, Director, U.S. Army Criminal Investigative Command’s, Major Procurement Fraud Unit, announce that 100 South Florida residents were charged for their alleged participation in various schemes to defraud Medicare and Medicaid out of approximately $220 million. The charges in South Florida are part of a nationwide takedown by Medicare Fraud Strike Force operations in 36 federal districts that resulted in 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. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) also suspended a number of providers using its suspension authority as provided in the Affordable Care Act. This coordinated takedown is the largest in the history of the Medicare Fraud Strike Force.
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 and prescription drugs. Approximately 28 South Florida defendants 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.
U.S. Attorney Wifredo A. Ferrer stated, “The United States Attorney’s Office for the Southern District of Florida remains relentless in combating health care fraud. The takedown announced today is the largest in the history of the Southern District of Florida in terms of the number of defendants charged. It also demonstrates that we continue to prosecute every link in the health care fraud chain - from the pharmacy or home health agency owner that submits false claims to the Medicare beneficiaries who decide to abuse their health care privileges by accepting kickbacks from patient recruiters, to the medical professionals whose judgment becomes compromised by the payment and receipt of kickbacks, we will find them and bring them to justice. I thank our federal, state and local law enforcement partners who with our Office stand committed to find, stop and punish those who steal from a program that provides the security of health care to the most needy in our society.”
“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.”
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 conspiring to submit a total of approximately $900 million in fraudulent billing.
“Health care providers and patients are key to protecting the Medicare and Medicaid programs, but when they instead choose to commit fraud and engage in widespread kickback schemes, they steal precious tax dollars and corrupt the integrity of our health care system,” said Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health & Human Services Office of Inspector General (OIG). “This takedown reflects the dedication of OIG and our law enforcement partners to bring such fraudsters to justice.”
Acting Inspector General Norbert E. Vint stated, “Today’s arrests demonstrate that the U.S. Government will not tolerate fraud in the compounding pharmacy industry. We appreciate the efforts of all the investigating agencies and the Department of Justice that have held these individuals accountable for their actions, and thereby protected taxpayer funded health care programs, including the Federal Employees Health Benefits Program.”
Florida Attorney General Pam Bondi stated, “With this historic fraud takedown we are sending the message to anyone scheming to steal from our Medicaid and Medicare programs that we will find them and they will be held accountable. Thanks to the joint efforts of my Medicaid Fraud Control Unit and our federal partners, this takedown has stopped millions of dollars in potential future fraud and will ensure those responsible are held to account.”
“Healthcare providers who dispense prescription drugs that are medically unnecessary put patients’ health at risk,” said George M. Karavetsos, Director, FDA Office of Criminal Investigations. “The FDA will continue to pursue those who perpetrate fraudulent schemes that target the health and safety of consumers.”
“These arrests demonstrate an unrelenting effort by the Defense Criminal Investigative Service (DCIS) and its law enforcement partners to protect the integrity of the Department of Defense (DoD) health care program,” said Special Agent in Charge John F. Khin, Southeast Field Office. “Fraud and abuse by pharmacies, marketing entities, and medical providers involved in fraudulent compounded drug prescriptions is a significant threat to the DoD health care system. DCIS will fully pursue both criminal and civil remedies to recover taxpayer dollars and bring justice to violators who target American service members, veterans, and their families.”
“These arrests should send a clear message to all pharmacies that FEHB fraud is a federal crime that carries serious consequences and will not be tolerated,” said Special Agent in Charge Max Eamiguel, U.S. Postal Service, Office of Inspector General (USPS-OIG.) “We along with our law enforcement partners will continue to aggressively investigate those who engage in fraudulent activities intended to defraud federal benefit programs and the Postal Service.”
“We utilize our extensive financial and money laundering investigative authorities to combat fraud throughout our economy, especially in areas such as identity theft and health care fraud,” said Robert C. Hutchinson, Acting Special Agent in Charge of HSI Miami. “Due to the importance of the health care sector, these investigations are particularly critical for our nation.”
“U.S. Customs and Border Protection is committed to fighting fraud by providing unparalleled support to an ever-expanding network of law enforcement partners across Florida,” said Diane J. Sabatino, Director Field Operations for Miami/Tampa Field Offices. “CBP enforces more than 400 laws and regulations for 40 different agencies and will continue to work alongside local, state, and federal government partners every day to protect the public.”
“We are very pleased with the results of this complex and lengthy investigation and today’s announcement is a textbook example of seamless interagency law enforcement cooperation and teamwork,” said Frank Robey, Director of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit. “Our agency stands ready and able to fully investigate allegations of this nature that impact DOD and the American taxpayers.”
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. Below are some of the cases included in the takedown:
A. MEDICARE PART D
1. United States v. Edgardo Lobo, et al., Case No. 16-20334-CR-Lenard
Edgardo Lobo, 50, of Miami, the owner or operator of Oshun Pharmacy, Lycan Services, Accalia Crative and Formula Pharmaceuticals; Ileana Calvo, 51, of Miami, the president of Universal Healthcare; and Juan Carlos Acosta, 53, of Hialeah, president of Pharmmed Delivery, were charged with one count of conspiracy to commit health care fraud, one count of conspiracy to pay and receive health care kickbacks, and one count conspiracy to commit money laundering. Additionally, Edgardo Lobo was charged with five counts of health care fraud, and seven counts of money laundering; Ileana Calvo was charged with two counts of money laundering; and Juan Carlos Acosta was charged with three counts of money laundering. The charges stem from the defendants’ role in a $4.8 million pharmacy fraud scheme.
Mr. Ferrer commended the investigative efforts of FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Lisa Miller of the Criminal Division’s Fraud Section.
2. United States v. Nereida Montejo, et al, Case No. 16-20400-CR-Scola
Nereida Montejo, 65, of Miami, owner and operator, Nerta Rodriguez, 73, of Miami, operator, and Carlos Hernandez, 64, of Miami, patient recruiter, all for New Pharmacy Discount, Corp., were charged with one count of conspiracy to defraud the United States and to pay and receive health care kickbacks. Montejo and Rodriguez were additionally charged with one count of conspiracy to commit health care fraud and wire fraud. Montejo was also charged with nine counts of health care fraud, and four counts of payment of kickbacks in connection with a federal health care program. The charges stem from each defendants’ alleged role in a $5.2 million scheme, whereby Montejo, as the owner and operator of New Pharmacy, paid kickbacks and bribes to patients and patient recruiters in order to bill both Medicare and Medicaid for medications that were not purchased.
Mr. Ferrer commended the investigative efforts of the FBI, HHS-OIG and the State of Florida Medicaid Fraud Control Unit. This case is being prosecuted by DOJ Attorney Stephen Cincotta of the Criminal Division’s Fraud Section.
3. United States v. Arturo Rodriguez Sr, Case No. 16-20425-CR-Lenard
Arturo Rodriguez, 69, of Miami, owner and operator of Olympia Discount, Corp. was charged with conspiracy to commit health care fraud and wire fraud, and conspiracy to defraud the United States and pay health care kickbacks. The charges stem from Rodriguez’s alleged role in a $2.6 million scheme, whereby Rodriguez, as the owner and operator of the Olympia Discount pharmacy, paid kickbacks and bribes to patients and patient recruiters in order to bill Medicare for medications that were not prescribed to patients, were not necessary, and were not purchased.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Stephen Cincotta of the Criminal Division’s Fraud Section.
4. United States v. Andy Armas, Case No. 16-20474-CR-Middlebrooks
Andy Armas, 34, of Miami, owner and operator of Millenium Pharmacy and Marlins Pharmacy, was charged with one count of conspiracy to commit health care fraud and wire fraud, four counts of health care fraud, and one count of conspiracy to defraud the United States and pay health care kickbacks. The charges stem from Armas’s role in a $5.7 million scheme, whereby Armas, as the owner and operator of Millenium and Marlins pharmacies paid kickbacks and bribes to patients and patient recruiters in order to bill Medicare for medications that were not purchased.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Stephen Cincotta of the Criminal Division’s Fraud Section.
5. United States v. Niurka Fernandez and Roberto Alvarez, Case No. 16-20391-CR-Moreno
Niurka Fernandez, 54, of Miami, and Roberto Alvarez, 29, of Sweetwater, were charged with allegations that they participated in a health care fraud conspiracy involving two pharmacies, Calan Pharmacy and Best Pharmacy, both located in Miami. According to the indictment, the scheme involved paying kickbacks to patient recruiters and Medicare beneficiaries, as well as billing Medicare for prescription drugs that were never in fact dispensed. Both defendants were charged with conspiracy to commit health care fraud and wire fraud; conspiracy to commit money laundering; and substantive counts of money laundering. Additionally, Fernandez was charged with five substantive counts of health care fraud. In total, the indictment alleges a loss of over $16 million.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Trial Attorney L. Rush Atkinson of the Criminal Division’s Fraud Section.
6. United States v. Reinaldo Morey, et al., Case No. 16-20460-CR-Cooke
Reinaldo Morey, 50, and Niurka De La Caridad Morey, 50, both of Miami, were charged with conspiracy to commit health care fraud and health care fraud for using their pharmacy, Dalice Medical Equipment to bill Medicare for prescriptions that were never dispensed to the patients. The loss to Medicare was over $3.4 million.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Elizabeth Young of the Criminal Division’s Fraud Section
7. United States v. Carlos Cardenas, Case No. 16-20480-CR-Gayles
Carlos Cardenas, 47, of Miami, a pharmacy owner, was charged with health care fraud. The charges stem from Cardenas using his pharmacy, Nuestra Pharmacy, to bill Medicare for $730,000 in prescriptions that were never dispensed.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Elizabeth Young of the Criminal Division’s Fraud Section.
8. United States v. Marlenis Fernandez, Case No. 16-20486-CR-Moore
Marlenis Fernandez, 51, of Miami, owner of United Care Pharmacy, was charged with conspiracy to commit health care fraud. The charges stem from Fernandez’s alleged role in a scheme to defraud Part D of the Medicare program by billing for more than $900,000 of prescription drugs that were never purchased, never provided and were not medically necessary. As a result of the scheme, Medicare paid over $900,000 in fraudulent claims.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Timothy P. Loper of the Criminal Division’s Fraud Section.
9. United States v. Gabriela Alegria, Case No. 16-20485-CR-Lenard
Gabriela Alegria, 43, of Miami, owner of GAC Investor Corporation, was charged with conspiracy to commit money laundering. The charges stem from Alegria’s alleged involvement in a scheme in which the defendant established and maintained signature authority on business accounts that she used to launder over $700,000 in proceeds from a Medicare fraud scheme.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Timothy P. Loper of the Criminal Division’s Fraud Section.
10. United States v. Anet Martinez Gonzalez, Case No. 16-20450-CR-Scola
Anet Martinez Gonzalez, 43, of Dania, was charged with conspiracy to commit health care fraud and wire fraud. The Information alleges that Gonzalez was the manager of Calle Ocho Pharmacy in Miami. The Information further alleges that Gonzalez submitted and caused the submission of false and fraudulent claims to Medicare and Medicare drug plan sponsors for prescription drugs that were not actually provided to Medicare beneficiaries. As a result of these false and fraudulent claims, Medicare drug plan sponsors made payments funded by Medicare in the approximate amount of $273,757.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Daniel Bernstein.
11. United States v. Jose Nunez, Case No. 16-20458-CR-Scola
Jose Nunez, 64, of Miami, was charged with conspiracy to commit money laundering, money laundering, and witness tampering. The Indictment alleges that Nunez laundered approximately $196,500 in health care proceeds drawn from corporate accounts belonging to La Esperanza Pharmacy Discount, Inc. The Indictment further alleges that Nunez knowingly attempted to and engaged in witness tampering by directing an individual to falsely state that the monies provided to him were a loan for the purchase of certain real estate, with the intent to hinder and prevent the communication to federal agents of the United States Department of Health and Human Services, Office of Inspector General, and the FBI, rather than illegal proceeds from health care fraud.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Christopher Clark.
12. United States v. Roslane Pichs, et al., Case No. 16-20479-CR-Ungaro
Roslane Pichs, 41, Daniel Pichs Gonzalez, 64, and Raquel Castro, 63, all of Miami, were charged with conspiracy to commit health care fraud and wire fraud. Pichs and Gonzalez were also charged with six counts of substantive health care fraud. The Indictment alleges that Pichs, Gonzalez, and Castro submitted and caused the submission of fraudulent claims, via interstate wire, that falsely represented that various health care benefits, primarily prescription drugs, were medically necessary, prescribed by a doctor, and had been provided to Medicare beneficiaries by the defendants’ businesses, Mazal Tov Pharmacy, Inc. and Angel’s Light Pharmacy & Discount. As a result of such false and fraudulent claims, Medicare prescription drug plan sponsors made payments funded by the Medicare Part D Program to the corporate bank accounts controlled by the three defendants in the approximate amount of $7,709,636.
Mr. Ferrer commended the investigation efforts of HHS-OIG and ICE-HSI. This case is being prosecuted by Assistant U.S. Attorney Roger Cruz.
13. United States v. Alexis Avila, et al., Case No. 16-20471-CR-Altonaga
Alexis Avila, 39, Raiza Ruiz, 43, and Yis Fernandez, 36, all of Hialeah, were charged with conspiracy to commit health care fraud. The Information alleges that Avila, Ruiz, and Fernandez submitted and caused the submission of claims, via interstate wire, which falsely and fraudulently represented that various health care benefits, primarily prescription drugs, were medically necessary, prescribed by a doctor, and had been provided by La Esperanza Pharmacy Discount, Inc., in Hialeah, to Medicare beneficiaries. La Esperanza was purportedly a pharmacy that provided Medicare beneficiaries with various pharmaceutical items and services. As a result of such false and fraudulent claims, Medicare prescription drug plan sponsors, made payments funded by the Medicare Part D Program to the corporate bank accounts of La Esperanza in the approximate amount of $6,747,469.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Christopher Clark.
14. United States v. Dora Josefa Robaina, Case No. 16-20490-CR-Bloom
Dora Josefa Robaina, 48, of North Bay Village, was charged with failure to appear, in violation of Title 18, United States Code, Section 3146. In the case of United States v. Dora Josefa Robaina, Case No. 15-20799-CR-Middlebrooks, the defendant was previously sentenced to thirty three months in prison after she pled guilty to accessory after the fact in connection with her role in deceiving federal agents who attempted to arrest Antonio Hevia and Pedro Torres, two defendants who were involved in the submission of $16.7 in false claims to Medicare. At the sentencing hearing, Robaina was ordered to surrender to the Bureau of Prisons on June 10, 2016 and she failed to do so.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being handled by Assistant U.S. Attorney James Hayes.
B. HOME HEALTH
15. United States v. Daylin Cabrera, et al, Case No. 16-20476-CR-Zloch
Daylin Cabrera, 33, the owner of a fraudulent physical therapy staffing company; Raciel Leon, 42, the office manager of a fraudulent home health care company; and Alex Lopez Huergo, 37, all of Miami, the owner of a fraudulent home health care company were charged with conspiracy to commit health care fraud and one count of conspiracy to pay and receive kickbacks. Additionally, Cabrera was charged with two counts of health care fraud. The charges stem from their role in a $2.5 million home health care fraud scheme.
Mr. Ferrer commended the investigative efforts of FBI and HHS-OIG. This case is being prosecuted DOJ Attorneys Lisa Miller and Elizabeth Young of the Criminal Division’s Fraud Section.
16. United States v. Jose Avila, M.D. and Michael Bahrami, M.D., Case No. 16-20471-CR-Altonaga
Jose Avila, 58, of Hallandale, and Michael Bahrami, 60, of Golden Beach, two medical doctors, were charged with conspiracy to defraud the United States and receive health care kickbacks. Avila was also charged with one count of receiving health care kickbacks. The charges stem from their involvement in a $57 million home health fraud scheme involving paying kickbacks to doctors and patient recruiters, and billing for services that were not necessary and/or not provided. Avila was previously charged by Complaint with receiving kickbacks in connection with a federal health care program.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Vasanth Sridharan of the Criminal Division’s Fraud Section.
17. United States v. Cynthia Vilches, Case No. 16-20466-CR-Moore
Cynthia Vilches, 47, of Miramar, owner of Healthy Choice Home Health, was charged with one count of conspiracy to commit health care fraud. The charge arises from Vilches’ role in a $56 million home health fraud scheme involving paying kickbacks to doctors and patient recruiters, and billing for services that were not necessary and/or not provided.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Vasanth Sridharan of the Criminal Division’s Fraud Section.
18. United States v. Reidy Gonzalez, et al., Case No. 16-20464-CR-Zloch
Reidy Gonzalez, 43, and Yelina Isabel Gonzalez, 44, both of Miami, were charged with one count of conspiracy to defraud the United States and pay health care kickbacks. The charges stem from allegations that both defendants, who owned and controlled Dade-Kendall Home Healthcare Services, Inc., a home health agency in Miami, paid kickbacks to a patient recruiter in exchange for patients and billed Medicare for those patients.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Trial Attorney L. Rush Atkinson of the Criminal Division’s Fraud Section.
19. United States v. Mildrey Gonzalez, et al., Case No. 16-20461-CR-Martinez
Mildrey De La Caridad Gonzalez, 61, of Miami Beach, Milka Yarlin Alfaro, 39, of Miami Beach, Adriana Damas Jalil, 38, of Miami, and Luis Enrique Luzardo, 47, of Miami, were indicted on charges stemming from their respective roles in a scheme to defraud Medicare resulting in losses over $24 million. The alleged scheme involved six home health agencies in the greater Miami area, all of which are alleged in the Indictment to have been owned and controlled by Gonzalez and Alfaro. Gonzalez and Alfaro were charged with one count of conspiracy to commit health care fraud and wire fraud; seven counts of health care fraud; conspiracy to defraud the United States and pay and receive kickbacks in connection with a federal health care benefit program; conspiracy to commit money laundering, and substantive counts of money laundering. Jalil was charged with one count of conspiracy to defraud the United States and pay and receive kickbacks in connection with a federal health care benefit program and three substantive counts of receiving kickbacks in in connection with a federal health care benefit program. Luzardo was charged with one count of conspiracy to commit money laundering and two substantive counts of money laundering.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Trial Attorney L. Rush Atkinson of the Criminal Division’s Fraud Section.
20. United States v. Noemi Rodriguez, Case No. 16-20413-CR-Moreno
Noemi Rodriguez, 52, of Hialeah, President and Operator of US Care Network, Inc., was charged with conspiracy to defraud the United States and to solicit and receive kickbacks and four counts of soliciting and receiving kickbacks. The charges arise from Rodriguez’s alleged involvement in recruiting patients and providing prescriptions for home health agencies in exchange for kickbacks.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Katherine Payerle of the Criminal Division’s Fraud Section.
21. United States v. Armando Salazar, Case No. 16-20379-CR-Moreno
Armando Salazar, 65, of Miami, President and Director of Monzon Medical Diagnostic Corp., was charged with conspiracy to defraud the United States and receive health care kickbacks, receiving kickbacks in connection with a federal health care program, and three counts of health care fraud. The charges arise from Salazar’s alleged role in a $1.4 million scheme involving kickback payments for home health prescriptions.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Katherine Payerle of the Criminal Division’s Fraud Section.
22. United States v. Joanna Carpio and Leonie Dorce, Case No. 16-20412-CR-Gayles
Joanna Carpio, 25, of Miami, clinic office manager, and Leonie Dorce, 71, of Miami Lakes, Advanced Registered Nurse Practitioner, at City Center Rehab Corp., were charged with conspiracy to commit health care fraud. Carpio was also charged with conspiracy to defraud the United States and receive health care kickbacks. The charges arise from Carpio and Dorce’s alleged role in a more than $36 million scheme involving payment of kickbacks for prescriptions and referrals for home health care and other medical services.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Katherine Payerle of the Criminal Division’s Fraud Section.
23. United States v. Francisco Correa Delgado, Case No. 16-20482-CR-Moreno
Francisco Correa Delgado, 46, of Hialeah, President and Director of the home health agency, H&E Home Care, Inc., was charged with four counts of health care fraud for his role in a $3.1 million scheme. The charges arise from Delgado’s ownership of a home health agency that billed Medicare for home health services that were never prescribed by a licensed physician or provided to Medicare beneficiaries.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Katherine Payerle of the Criminal Division’s Fraud Section.
24. United States v. Dagoberto Morales, Case No. 16-20414-CR-Altonaga
Dagoberto Morales, 36, of Hialeah, President and Director of the home health agency, Samy Nursing Corp., Inc., was charged with four counts of health care fraud for his role in a $6 million scheme. The charges arise from Morales’ ownership of a home health agency that allegedly billed Medicare for home health services that were never prescribed by a licensed physician or provided to Medicare beneficiaries.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Angela Adams of the Criminal Division’s Fraud Section.
25. United States v. Dayami Martinez and Yadira Robertson, Case No. 16-20431-CR-Cooke
Dayami Martinez, 41, of Miami, Director of Nursing for two home health agencies, and Yadira Robertson, 55, of Miramar, physical therapy assistant working for a therapy staffing company, were charged with conspiracy to commit health care fraud and wire fraud. Martinez was also charged with two counts of false statements in connection with a federal health care program, and Robertson was charged with 10 counts of that crime. The charges arise from their involvement in an $830,000 fraud scheme between the therapy staffing company, R.C. Therapy, and two home health agencies, Maya Home Health and Floridian Home Health.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Vasanth Sridharan of the Criminal Division’s Fraud Section.
26. United States v. Elvis Hernandez, Case No. 16-20415-CR-Moore
Elvis Hernandez, 43, of Hialeah, President and Director of the home health agency, Global Nursing Association, Inc., was charged with three counts of health care fraud for his role in a $3.5 million scheme. The charges arise from Hernandez’s ownership of a home health agency that allegedly billed Medicare for home health services that were never prescribed by a licensed physician or provided to Medicare beneficiaries.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Angela Adams of the Criminal Division’s Fraud Section.
27. United States v. Pavel Aguila, et al., Case No. 16-20478-CR-Williams
Pavel Aguila, 42, of Miami, Laura Perez, 48, of Miami, and Emilio Enriquez, 53, of Florida City, were charged with conspiracy to defraud the United States and substantive counts of receiving kickbacks in connection with a federal health care program. The indictment alleges that Aguila, Perez, and Enriquez were patient recruiters who accepted kickbacks in return for referring Medicare beneficiaries to Casper Home Health, a Miami-Dade based home health agency
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Kevin Larsen.
28. United States v. Carlos F. Valencia, et al., Case No. 16-20462-CR-Moreno
Carlos F. Valencia, 45, of Miami Lakes, Rosa M. Cabrera, 58, of Hialeah, Reynaldo Cubilla, 64, of Miami, Josefina Caridad Fornells, 77, of Miami, Epifania Gonzalez, 76, of Miami, Francisco Emilio Hernandez, 83, of Miami, Evelio Linares, 82, of Miami, Zoila Miranda, 59, of Miami, Jacinto Margarito Montenegro, 84, of Miami, Francisco Oramas, 82, of Miami, and Electo Pena, 65, of Miami, were charged with conspiracy to pay and receive health care kickbacks and substantive counts of paying and receiving kickbacks. The Indictment alleges that Valencia was the owner of D’Val home health agency, a company that purportedly provided skilled nursing services to homebound Medicare beneficiaries. The Indictment alleges that Valencia paid kickbacks to patient recruiters who referred Medicare beneficiaries. The Indictment further alleges that Medicare beneficiaries Hernandez, Linares, Miranda, Montenegro, Oramas, and Pena accepted kickbacks in return for agreeing to serve as patients for the home health agency. The indictment alleges that these kickbacks ranged in amounts from $760 to $1,200.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Michael Nadler.
29. United States v. Sulman Bonilla, Case No. 16-20401-CR-Dimitrouleas
Sulman Bonilla, 46, of Miami, was charged with conspiracy to defraud the United States and pay health care kickbacks, and substantive counts of paying health care kickbacks. The Indictment alleges that Bonilla paid kickbacks to patient recruiters in exchange for the referral of Medicare beneficiaries to American Way Home Care, a Miami-Dade home health care agency. The Indictment further alleges that Bonilla caused American Way Home Care to submit claims to Medicare for services purportedly provided to the recruited beneficiaries.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Amanda Perwin.
30. United States v. Erika Bonilla, et al., Case No. 16-20402-CR-Lenard
Erika Bonilla, 41, and Emmanuel Ventura, 48, both of Miami, were charged with conspiracy to defraud the United States and pay health care kickbacks, and substantive counts of paying health care kickbacks. The Indictment alleges that Bonilla and Ventura paid kickbacks to patient recruiters in exchange for the referral of Medicare beneficiaries to America Home Health, a Miami-Dade home health care agency. The Indictment further alleges that Bonilla and Ventura caused America Home Health to submit claims to Medicare for services purportedly provided to the recruited beneficiaries.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Amanda Perwin.
C. COMMUNITY MENTAL HEALTH
31. United States v. Caridad Turner, Case No. 16-20443-CR-Altonaga
Caridad Turner, 43, of Miami, a clinical director of a now defunct partial hospitalization program a Greater Miami Behavioral Health, was charged with conspiracy to commit healthcare fraud. The charges stem from the defendant’s role in a $60 million scheme to defraud the federal Medicare program.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Elizabeth Young of the Criminal Division’s Fraud Section.
32. United States v. Felix Lamelas, et al., Case No. 16-20453-CR-Zloch
Felix Lamelas, 60, of Miami, Dunia Ayala, 50, of Miami, Jose Ortiz, 58, of Hialeah, Hildara Urquiola, 77, of Pembroke Pines, and Marta Maggi, 80, of Pembroke Pines, were charged for their role in recruiting patients for the now defunct partial Hospitalization program at Greater Miami Behavioral Health. All defendants were charged with conspiracy to pay and receive kickbacks in connection with a federal health care benefit program for their roles in a $60 million fraud scheme.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by DOJ Attorney Elizabeth Young of the Criminal Division’s Fraud Section.
D. MEDICARE PART C (MEDICARE ADVANTAGE)
33. United States v. Ruth Aracelly Garcia, Case No. 16-20483-CR-Altonaga
Ruth Aracelly Garcia, 37, of Miami, a former office manager of Santiago Montoya, M.D., was charged with conspiracy to commit health care fraud, health care fraud, conspiracy to defraud the United States, and making false statements related to a health care matter. The Indictment alleges that Garcia and her co-conspirators recruited Medicare beneficiaries residing in Nicaragua to enroll in Medicare Advantage plans, submitted plan enrollment requests on behalf of Medicare beneficiaries that falsely and fraudulently represented that the beneficiaries resided in the plans service area within Florida, and enrolled Medicare beneficiaries residing in Nicaragua into Florida Medicaid by falsely and fraudulently representing that the beneficiaries resided in the United States.
Mr. Ferrer commended the investigative efforts of the FBI, HHS-OIG and the State of Florida Medicaid Fraud Control Unit. This case is being prosecuted by Special Assistant U.S. Attorney Hagerenesh Simmons from the Florida Attorney General Office, Medicaid Fraud Control Unit.
E. PRIVATE INSURANCE
34. United States v. Rogelio Alonso, et al., Case No. 16-20457-CR-Williams
Rogelio Alonso, 49, Mercedes Alonso, 48, and Sheneider Telfort, 32, all of Miami, were charged with conspiracy to commit health care fraud and substantive counts of health care fraud. The Indictment alleges that Rogelio Alonso, Mercedes Alonso, Sheneider Telfort, and their co-conspirators submitted and caused the submission of false and fraudulent claims to private insurance plans, via interstate wire transmission, including Blue Cross Blue Shield (“BCBS”), Cigna, AvMed, and United Health Care (“UHC”), on behalf of various medical clinics seeking approximately $10,662,813 as reimbursement for injection treatments, physical therapy treatments, and other medical items and services which were neither ordered by a physician nor provided to a beneficiary as claimed. As a result of such false and fraudulent claims, Rogelio Alonso, Mercedes Alonso, Sheneider Telfort, and their co-conspirators caused private insurance plans, including BCBS, Cigna, and UHC, to make payments to the medical clinics totaling approximately $2,253,322.
Mr. Ferrer commended the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant United States Attorney Christopher Clark.
F. TRICARE
35. United States v. Celep Simsir, et al., Case No. 16-20399-CR-Gayles
Celep Simsir, 35, and Sonsoles Simsir 39, both of Jacksonville, were charged with conspiracy to commit health care fraud and mail fraud, conspiracy to pay and receive health care kickbacks, substantive counts of health care fraud and the payment and receipt of kickbacks, in connection with a conspiracy to defraud TRICARE, a United States Department of Defense health insurance programs for military personnel and their dependents. Nigal Mitchell, 25, of Jacksonville, and Andrea Rivera-Lorenzo 28, of Puerto Rico, were charged with for receiving kickbacks in return for recruiting TRICARE beneficiaries to participate in the fraudulent scheme.
The Indictment alleges that Celep Simsir and Sonsoles Simsir paid health care kickbacks to a doctor and a physician’s assistant in the Southern District of Florida in return for prescriptions for compounded medications which were not medically necessary. These medical professionals never examined or spoke with the patients. These prescriptions were then filled at a pharmacy in the Southern District of Florida which submitted approximately $25,763,938 in false and fraudulent claims. As a result of these claims, TRICARE made payments of $21,293,201 to the pharmacy.
According to detention hearing testimony, during the course of affecting the arrest of Celep Simsir and Sonsoles Simsir, federal agents allegedly seized approximately $344,000 in cash, seven firearms, including an AR-15 rifle, a Lamborghini and a Porsche. Agents also executed seizure warrants that resulted in the seizure of over $2 million.
Mr. Ferrer commended the investigative efforts of DCIS, USPIS-OIG, FDA-OCI, OPM-OIG and U.S. Army Criminal Investigative Command's, Major Procurement Fraud Unit. This case is being prosecuted by Assistant U.S. Attorneys Daniel Bernstein and Evelyn B. Sheehan.
If convicted of a charged offense, a defendant faces a possible maximum statutory sentence of five years in prison for conspiracy to defraud the United States by paying and receiving health care kickbacks, in violation of Title 18, United States Code, Section 371; five years in prison for payment and receipt of kickbacks in connection with a federal health care program, in violation of Title 42, United States Code, Section 1320a; twenty years in prison for mail or wire fraud, in violation of Title 18, United States Code, Section 1341; ten years in prison for health care fraud, in violation of Title 18, United States Code, Section 1347; twenty years for conspiracy to commit health care fraud and wire fraud, in violation of Title 18, United States Code, Section 1349; and twenty years for money laundering or conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956.
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.
A complaint, information or indictment is merely a charge, and defendants are presumed innocent until proven guilty.
To learn more about HEAT, go to: www.stopmedicarefraud.gov.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Tuesday 21 June 2016
Williston ND Man Sentenced for Receipt of Child PornographyRead the Press Release
BISMARCK - US Attorney Christopher C. Myers announced that on June 21, 2016, Steven Edward Brooks, 50, Williston ND., was sentenced before US District Judge Daniel L. Hovland to serve 14 years in prison after pleading guilty to one count of Receipt of Child Pornography. Judge Hovland also ordered that he serve 20 years of supervised release and to pay a $100 special assessment to the Crime Victims Fund. Brooks was previously employed as a Sergeant as the Williams County Correctional Center.
“It’s always extremely troubling when someone in a position of public trust is convicted of child pornography offenses, especially so in the case of Mr. Brooks who was caught with such a large amount of material,” said Alex Khu, special agent in charge of HSI St. Paul. “But HSI’s special agents are ever-vigilant and, with the help of our local and state partners, will aggressively pursue those who harm the children of our communities.”
This case came to the attention of law enforcement after an agent with the North Dakota Bureau of Investigations, assigned to the Internet Crimes Against Children Task Force (ICAC), discovered a computer geographically located in ND that was sharing child pornography in a peer-to-peer (P2P) network. A search warrant was conducted on Brooks’ electronic media and a forensic examination revealed over 190,000 still images and almost 1600 videos containing child pornography.
This case was investigated by the Department of Homeland Security - Homeland Security Investigations and the North Dakota Bureau of Criminal Investigations.
Assistant US Attorney Gary Delorme prosecuted this case as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by U.S. Attorneys’ Offices throughout the nation, Project Safe Childhood, in conjunction with Internet Crimes Against Children Task Force (ICAC), help federal, state, and local law enforcement agencies enhance their investigative responses to offenders who use the Internet, online communications systems, or computer technology to sexually exploit children. The ICAC Program is a national network of 61 coordinated task forces engaging in proactive investigations, forensic investigations, and criminal prosecutions. Project Safe Childhood also helps to identify and rescue victims. For more information about Project Safe Childhood, please visit www.Projectsafechildhood.gov.
West Virginia man convicted, sentenced for cocaine distributionRead the Press Release
CLARKSBURG, WEST VIRGINIA– Claude Jones, 33, of Fairmont, West Virginia was convicted and sentenced today for cocaine distribution, United States Attorney William J. Ihlenfeld, II, announced.
Jones sold cocaine in the Fairmont area of Monongalia County during January 2014. Jones pled guilty today to one count of “Distribution of Cocaine within 1000 feet of a Protected Location.” He was sentenced today to 120 months in prison.
Assistant U.S. Attorney Zelda E. Wesley prosecuted the case on behalf of the government. The Mon Metro Drug Task Force investigated.
U.S. District Judge Irene M. Keeley presided.
Warren man pleads guilty to mailing white powder to former employerRead the Press Release
Anthony J. Natale, of Warren, pleaded guilty today to one count of conveying false information related to the use of a weapon of mass destruction, said Carole S. Rendon, Acting U.S. Attorney for the Northern District of Ohio, and Stephen D. Anthony, Special Agent in Charge of the FBI’s Cleveland Office.
Natale is scheduled to be sentenced on Sept 27.
Natale mailed an envelope containing white powder via the United States Postal Service to American Business Center, at 7677 South Avenue, Youngstown, on November 10, 2014. This was done with the intent to convey false and misleading information related to the use of a weapon of mass destruction, according to court documents.
Natale formerly worked at American Business Center. He was terminated on Oct. 6, 2014, according to court documents.
The case is being prosecuted by Assistant U.S. Attorney Justin Seabury Gould, and was investigated by the Federal Bureau of Investigation and Mahoning County Sheriff's Office.