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Monday 8 July 2013
Sex Offender Sentenced to 65 Months in Federal Prison for Failing to Register for A 3rd TimeRead the Press Release
PROVIDENCE, R.I. – Christian J. Morales, 30, formerly of Pawtucket and Woonsocket, R.I., and Blackstone, Mass., was sentenced today to 65 months in federal prison for failing to register as a sex offender for the 3rd time, announced United States Attorney Peter F. Neronha and United States Marshall Jamie A. Hainsworth. The sentence was imposed by U.S. District Court Judge William E. Smith.
Morales, convicted in Rhode Island state court in December 2006 on two counts of child molestation, has a lifetime duty to register as a sex offender under the federal Sex Offender Registration and Notification Act (SORNA).
SORNA provides a comprehensive set of federal standards for sex offender registration and notification in the United States through the nationwide network of sex offender registration and notification programs. Additionally, SORNA requires registered sex offenders to register and keep their registration current in each jurisdiction in which they reside, work, or go to school, and to make periodic in-person appearances to verify and update their registration information.
According to information presented to the court, Morales was arrested and charged in November 2008 and in June 2010 with failing to register as a sex offender after changing addresses in Woonsocket and Pawtucket.
Morales was arrested for failing to register as a sex offender for the third time on July 1, 2010, after Woonsocket Police became aware that Morales was no longer living at a Woonsocket address where he was registered. Morales was located in a Blackstone, Mass., apartment where he was living with his girlfriend and her 4-year-old child, and was arrested by members of the U.S. Marshals Service, R.I. State Police, Woonsocket Police and Mass. State Police
The case was prosecuted by Assistant U.S. Attorney Mary Rogers.
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To assist the media and the public, a glossary of federal judicial terms and procedures is available at http://www.justice.gov/usao/justice101/
Contact: 401-709-5357
[email protected]San Antonio Man Indicted for Allegedly Shooting Common-Law Wife on Fort Sam Houston Faces New Charge of Conspiracy to Kill A WitnessRead the Press Release
A San Antonio man who is currently under federal indictment for allegedly shooting his common-law wife multiple times on Fort Sam Houston last month faces a new charge of conspiracy to kill a witness to prevent testimony and in retaliation for providing information to law enforcement announced United States Attorney Robert Pitman and Federal Bureau of Investigation San Antonio Division Special Agent in Charge Armando Fernandez.
A federal criminal complaint filed this morning against 51–year-old Alvin Leon Roundtree alleges that from June 26, 2013 until July 7, 2013, Roundtree conspired with his nephew, 28-year-old Leonard Roundtree, Jr., of Richardson, TX, to hire an individual to kill Alvin Roundtree’s common-law wife. According to the complaint, in recordings of multiple telephone calls placed by Alvin Roundtree from the GEO federal jail facility to Leonard Roundtree, Alvin told Leonard that he was going to pay an individual $10,000 to kill his common-law wife to prevent her from testifying against him in his upcoming trial and for providing information to investigators about the June 10, 2013, shooting incident. According to the complaint, Leonard Roundtree agreed to deliver a pre-payment of $1,000 to the individual solicited to commit the murder plus $9,000 more after the murder was carried out.
Leonard Roundtree was arrested yesterday in Richardson, TX. He had his initial appearance in federal court in Dallas earlier today where he waived his detention hearing and agreed to be transferred to the Western District of Texas for further court proceedings. Upon conviction of the conspiracy to kill charge, each defendant faces up to life in federal prison.
This case is being investigated by the Federal Bureau of Investigation (FBI) and the United States Marshals Service together with the U.S. Army Criminal Investigation Division and the San Antonio Police Department. Assistant United States Attorney Bettina Richardson is prosecuting this case on behalf of the Government.
A criminal complaint is merely a charge and should not be considered as evidence of guilt. The defendant is presumed innocent until proven guilty in a court of law.
San Angelo Man Admits Possessing Child PornographyRead the Press Release
LUBBOCK, Texas — Joshua I. Suter, 24, of San Angelo, Texas, appeared in federal court in Lubbock on Friday, before U.S. District Judge Sam R. Cummings, and pleaded guilty to one count of possession of child pornography. Suter, who remains on bond, faces a maximum statutory penalty of 10 years in federal prison, a $250,000 fine and a lifetime of supervised release. Judge Cummings ordered a presentence investigation report with a sentencing date to be set after the completion of that report. Today’s announcement is made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
According to documents filed in the case, while living in San Angelo, Suter owned a computer which he kept at his residence. That computer was connected to the Internet. In the course of using the Internet to search for depictions of minors engaged in sexually explicit conduct, Suter downloaded and viewed numerous child pornography videos.
The case was brought as part of Project Safe Childhood, a nationwide initiative, which was launched in May 2006 by the Department of Justice, to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals, who sexually exploit children, and identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/. For more information about internet safety education, please visit http://www.justice.gov/psc/ and click on the tab “resources.”
The case is being investigated by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant U.S. Attorney Steven M. Sucsy is in charge of the prosecution.
Saline County Woman Pleads Guilty to Methamphetamine Related OffenseRead the Press Release
Ashley Renee Uze, 27, of Harrisburg, Illinois, pled guilty today in United States District Court in Benton to an indictment charging her with possessing pseudoephedrine with the intent that it be used to manufacture methamphetamine, Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced. The indictment, returned by a Federal Grand Jury on March 5th, alleged that the offense occurred on November 5, 2012.
Sentencing was set for October 24, 2013, at 11:00 a.m at the United States District Courthouse in Benton. At that time, Uze faces up to 20 years’ imprisonment, a $250,000 fine, and 3 years of supervised release to follow her incarceration.
Uze was remanded to the custody of the United States Marshal to await sentencing.
The case was investigated by the Carmi office of the Southern Illinois Drug Task Force and is being prosecuted by Assistant United States Attorney James M. Cutchin.
Rapid City Man Indicted on Firearm ChargesRead the Press Release
United States Attorney Brendan V. Johnson announced that a Rapid City man previously convicted of a felony was indicted by a federal grand jury for knowingly possessing a stolen 9 mm caliber pistol and a stolen .30-30 caliber rifle, knowing he was prohibited from doing so.
Ryan Umbarger, age 22, was indicted on June 18, 2013, for Possession of a Stolen Firearm and Felon in Possession of a Firearm. He appeared before U.S. Magistrate Judge Veronica L. Duffy on July 2, 2013, and pleaded not guilty to the indictment. The maximum penalty upon conviction is 10 years’ imprisonment and/or a $250,000 fine. The charges are merely an accusation and Umbarger is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Pennington County Sheriff’s Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Assistant U.S. Attorney Eric Kelderman is prosecuting the case. Umbarger was remanded to the custody of the U.S. Marshal. A trial date has not yet been set.
# # #Owner of New York City Parking Lots Pleads Guilty to Failing to Pay Payroll Taxes to the IRSRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that TREVOR WHITTINGHAM, an owner of parking lots in Manhattan, pled guilty in Manhattan federal court to failing to pay payroll taxes to the Internal Revenue Service (“IRS”). WHITTINGHAM was arrested in January 2013 and pled guilty today before U.S. District Judge Richard J. Sullivan.
According to the Indictment and statements made in open court today at the plea proceeding:
WHITTINGHAM owned and controlled two companies, EZ Going Park Here and We Have Cars II, through which he operated parking lots in Harlem and other parts of upper Manhattan, New York. He was responsible for collecting, accounting for, and paying payroll taxes on behalf of both of these companies. From December 2006 through June 2009, WHITTINGHAM caused EZ Going Park Here and We Have Cars II to deduct and collect payroll taxes from its employees. The majority of those payroll taxes, however, were not paid over to the IRS as required. Instead, WHITTINGHAM used the corporate funds of EZ Going Park Here and We Have Cars II to pay for various personal items and otherwise finance a lavish lifestyle. As a result, from 2005 through 2009, EZ Going Park Here and We Have Cars II accumulated approximately $251,265 in unpaid payroll tax liabilities.
WHITTINGHAM, 63, of Fort Lee, New Jersey, pled guilty to one count of willfully failing to pay over payroll taxes to the IRS. He faces a maximum sentence of five years in prison. He will be sentenced by Judge Sullivan on November 15, 2013 at 10:30 a.m. WHITTINGHAM also agreed to make restitution to the IRS in the amount of $251,265.
Mr. Bharara praised the IRS, Criminal Investigation for its outstanding work in the investigation. He also thanked the U.S. Department of Justice’s Tax Division for their significant assistance in the investigation.
This case is being handled by the Office’s Complex Frauds Unit. Special Assistant U.S. Attorney Andrew Young is in charge of the prosecution.
New Fairfield Brothers Sentenced to Federal Prison for Distributing OxycodoneRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that two New Fairfield men were sentenced today in Bridgeport federal court for trafficking oxycodone and other controlled substances. U.S. District Judge Stefan R. Underhill sentenced JASON GEORGE WITTLIN, 30, and his brother, MICHAEL WITTLIN, 24, to prison terms of 48 months and 38 months, respectively.
According to court documents and statements made in court, in approximately February 2011, the Drug Enforcement Administration, in conjunction with the Connecticut State Police/Statewide Narcotics Division and Danbury Police Department began investigating a narcotics-trafficking organization led by JASON and MICHAEL WITTLIN. The investigation, which included court-authorized wiretaps, physical surveillance and controlled drug purchases, revealed that the WITTLIN brothers were purchasing large quantities of oxycodone from several individuals, and then redistributing the narcotics to other street-level dealers and also to their own drug customers. The investigation also revealed that JASON WITTLIN purchased and redistributed marijuana.
JASON and MICHAEL WITTLIN were arrested on August 18, 2012. On that date, a search of their Milltown Road residence revealed 13 firearms and assorted ammunition from locations throughout the house.
The WITTLIN brothers have been detained since their arrests. On January 22, 2013, JASON WITTLIN pleaded guilty to one count of conspiracy to possess with intent to distribute controlled substances, namely oxycodone and oxymorphone. MICHAEL WITTLIN pleaded guilty to the same charge on April 5, 2013.
JASON WITTLIN’s criminal history includes a federal marijuana trafficking conviction in 2006, which resulted in a 21-month sentence.
This matter is being investigated by the Drug Enforcement Administration, the Connecticut State Police and the Danbury Police Department. The case is being prosecuted by Assistant United States Attorneys Tracy Lee Dayton and David X. Sullivan.
PUBLIC AFFAIRS CONTACT:
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[email protected]Naples Residents Plead Guilty to Tax Fraud for <br /> Failing to Pay Employment TaxesRead the Press Release
The Justice Department and the Internal Revenue Service (IRS) announced that Anthony Chaudhuri and Margaret Chaudhuri, of Naples, Fla., pleaded guilty today to one count each of conspiracy to defraud the United States.
According to court documents, the Chaudhuris owned and operated a hospital inventory control software company under the name Ariel Computing and various other nominee names, including ADI. Ariel Computing was operated from various addresses in Ann Arbor, Mich. Court documents indicate that between 1996 and 2008, the Chaudhuris withheld approximately $888,353 in employment taxes from Ariel Computing employees, but failed to pay over to the IRS approximately $704,488 of these withheld taxes, instead diverting those funds for their own personal use.
At sentencing, the Chaudhuris face a maximum of five years in prison and a $250,000 fine for the conspiracy charge. A sentencing date has not yet been set.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, commended the efforts of special agents IRS–Criminal Investigation, who investigated the case, and Tax Division Trial Attorneys Tiwana Wright and Mark McDonald, who are prosecuting the case.
Mexican Nationals Residing in Valencia County Sentenced to Federal Prison for Methamphetamine Trafficking ConvictionsRead the Press Release
ALBUQUERQUE – Adaucto Chavez-Meza, 20, was sentenced this morning to 135 months in federal prison for his methamphetamine trafficking conviction. One of his co-defendant, Jesus Omar Lopez-Valle, 28, was sentenced on June 24, 2013 to 210 months in federal prison for his methamphetamine trafficking and firearms conviction. Both men are Mexican nationals and will be deported after completing their prison sentences.
Chavez-Meza, Jesus Lopez-Valle and co-defendant Hector Manuel Lopez-Valle, 24, also a Mexican national, were arrested on methamphetamine trafficking charges on March 1, 2012. At the time, the three men were illegally present in the United States and living in Valencia County, N.M.
According to court filings, from Feb. 21, 2012 to March 1, 2012, Jesus Lopez-Valle and Hector Lopez-Valle conspired with Chavez-Meza to sell four pounds of methamphetamine to an individual who, unbeknownst to them, was an undercover officer. The men were arrested in Albuquerque on March 1st, after they displayed more than four pounds of methamphetamine to the undercover officer. During a post-arrest interview, Chavez-Meza admitted that they intended to sell the methamphetamine to the undercover officer for approximately $60,000. Jesus Lopez-Valle also admitted that the three men intended to sell the methamphetamine to the undercover officer, and Hector Lopez-Valle admitted to transporting the methamphetamine from Belen to Albuquerque.
Chavez-Meza pleaded guilty on Feb. 25, 2013, to an indictment charging him with conspiracy and possession of methamphetamine with intent to distribute. Jesus Lopez-Valle and Hector Lopez-Valle each pleaded guilty on March 1, 2013, to a superseding indictment charging them with conspiracy and possession of methamphetamine with intent to distribute. Jesus Lopez-Valle also pleaded guilty to being an illegal alien in possession of firearms. All three men entered their guilty pleas without the benefit of plea agreements.
Hector Lopez-Valle remains in federal custody pending his sentencing hearing, which is scheduled for July 22, 2103. At sentencing, he faces a mandatory minimum ten years in prison and a maximum of life in prison, and will be deported after completing his prison sentence.
The case was prosecuted by Assistant U.S. Attorneys Samuel A. Hurtado and Nicholas J. Ganjei and was investigated by the Cross Border Drug Violence Squad of the Albuquerque Division of the FBI and the Las Cruces/Doña Ana County Metro Narcotics Agency.Las Vegas Man Pleads Guilty to Federal Stolen Goods ChargesRead the Press Release
LAS VEGAS – A man pleaded guilty today to federal charges that he stole over $300,000 in expensive jewelry from persons at golf courses in multiple states, including Nevada, and sold it at trade shows, jewelry stores and pawn shops, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Jeffrey Cochran, 47, of Las Vegas, pleaded guilty before U.S. District Judge Gloria M. Navarro to two counts of possession and sale of stolen goods, and is scheduled to be sentenced on Oct. 18, 2013, at 9:00 a.m. Cochran faces up to 10 years in prison and a $250,000 fine on each count.
According to the plea agreement, from about Sept. 15, 2010, to March 10, 2012, Cochran stole jewelry, including Tag Heuer and Rolex watches, from individuals at golf courses in other states and transported the goods to Las Vegas for sale at jewelry and pawn stores. Cochran also stole jewelry from individuals at golf courses in Las Vegas and transported the stolen jewelry to other states to sell at trade shows and jewelry and pawn stores. The plea agreement states that the government and defendant agree that the readily provable loss associated with Cochran’s theft is $300,895.The case was investigated by the FBI and the Las Vegas Metropolitan Police Department Special Investigations Section, and was part of a federal and local law enforcement effort to combat organized retail theft. The case is being prosecuted by Assistant United States Attorney Christina M. Brown.
Justice Department Statement on Meeting with European UnionRead the Press Release
"This morning the Department of Justice hosted the initial meeting in the U.S.-E.U./E.U. Member State dialogue on intelligence practices, as first suggested by Attorney General Holder during a ministerial gathering with E.U. officials in Dublin last month.
“Officials from the Justice Department, Office of the Director of National Intelligence and the State Department represented the United States government. Officials from the E.U. included representatives of the Lithuanian Presidency of the EU, the European Council, the European Commission, the External Action Service of the EU, and EU Member States.
“This meeting focused on next steps for discussion of these issues, including the possibility of a follow-on meeting in the coming weeks. This open and constructive dialogue illustrates the extent and depth of the relationship between the U.S. and our European partners as we strive to protect both the safety and individual liberties of citizens on both sides of the Atlantic.“We look forward to this continued dialogue and cooperation with the EU and EU Member States.”
Justice Department Seeks to Shut Down Indiana Tax PreparerRead the Press Release
The Justice Department announced today that it has asked a federal court in Indianapolis, to bar Cynthia Hawk, who operates Gain Tax Services, from preparing tax returns. The civil injunction suit alleges that Hawk fails to comply with due diligence requirements imposed by federal law on tax preparers who claim the earned income tax credit (EITC) on customers’ income tax returns. According to the complaint, Hawk also falsified customers’ incomes in order to claim the maximum EITC for them.
The EITC is a refundable federal income tax credit available to certain low to moderate income working individuals and families. As a refundable credit, the EITC may entitle a taxpayer to a refund from the U.S. Treasury. The amount of the EITC depends on the taxpayer’s income, filing status and claimed number of dependents. The maximum credit in 2010 was $5,666. The range of earned income generating a maximum EITC is sometimes called the “sweet spot.” According to the complaint, Hawk fabricated businesses and reported fake business income on her customers’ tax returns to reach the EITC sweet spot.
The complaint alleges that the Internal Revenue Service (IRS) determined that Hawk failed to comply with due-diligence requirements when claiming the EITC for her customers. The IRS penalized Hawk in 2011 for her failures. When the IRS performed a follow-up investigation in 2012, as it routinely does, the complaint alleges that it again found ongoing failures and fraudulent claims by Hawk. According to the complaint, Hawk, who previously prepared tax returns in Atlanta, prepared at least 1,501 returns from 2009 through 2012, with unusually high refund rates ranging from 96 to 99 percent these years.
The complaint also alleges that Hawk claimed education credits on her customers’ tax returns, when the customers did not actually have any qualifying education expenses.
In the past decade the Justice Department’s Tax Division has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department’s Tax Division website www.justice.gov/tax.Related Materials:
United States v. Cynthia E. Hawk, etc.
Complaint for Permanent Injunction and Other Equitable Relief (PDF)Justice Department Enters into Memorandum of <br /> Understanding with National Labor Relations BoardRead the Press Release
The Justice Department announced today that the Civil Rights Division’s Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) has entered into a Memorandum of Understanding (MOU) with the National Labor Relations Board, formalizing a collaborative relationship that allows both agencies to share information, refer matters to each other and coordinate investigations as appropriate. OSC is responsible for enforcing the anti-discrimination provision of the Immigration and Nationality Act, which prohibits citizenship status and national origin discrimination in hiring, firing and recruitment or referral for a fee, as well as discriminatory Form I-9 and E-Verify practices. The National Labor Relations Board (NLRB) is an independent agency that enforces the National Labor Relations Act, which protects the rights of most private-sector employees to join together, with or without a union, to improve their wages and working conditions.
The MOU will allow the NLRB to make referrals to OSC, with the express authority of the NLRB charging party, when a matter before the NLRB suggests a possible violation of the anti-discrimination provision, such as verification of employment authorization, in the I-9 or E-Verify process, that appears to be discriminatory based on citizenship status or national origin. Similarly, the department will refer matters to the NLRB that appear to fall within that agency’s authority, such as infringement on the right to form, join, decertify or assist a labor organization, and to bargain collectively through representatives of their own choosing or to refrain from such activities. The MOU also provides for cross-training and technical assistance to ensure that staff within each agency can identify appropriate referrals. OSC has more than 50 partnership agreements with federal, state and local agencies, including U.S. Citizenship and Immigration Services and the Equal Employment Opportunity Commission.
“Employers cannot avoid liability under the law just because an employee has turned to the wrong agency or is unaware of additional protections available under a different law. Employees deserve to benefit from the efficiency of government cooperation, and employers will continue to benefit from agency guidance on how to comply with the anti-discrimination provision and the National Labor Relations Act,” said Gregory Friel, Deputy Assistant Attorney General for the Civil Rights Division.
For more information about protections against employment discrimination under the immigration laws, call OSC’s worker hotline at 1-800-255-7688 (1-800-237-2525, TTY for hearing impaired), sign up for a free one-hour webinar at www.justice.gov/crt/about/osc/webinars.php, email OSC at [email protected], or visit OSC’s website at www.justice.gov/crt/about/osc.
Indictments Unsealed Charging Fifteen Defendants with Drug Trafficking in TopekaRead the Press Release
TOPEKA, KAN. – Fifteen defendants have been indicted on drug charges as a result of a federal drug trafficking investigation in Topeka, U.S. Attorney Barry Grissom said today.
Federal prosecutors Monday unsealed indictments alleging the defendants were part of a conspiracy to distribute methamphetamine in the Topeka area. Investigators served search warrants and made arrests in the case July 2.
Named in the indictments are:
Francisco J. Granado, Sr., 44, Emporia, Kan., who is charged with one count of conspiracy to distribute methamphetamine and four counts of using a phone in furtherance of drug trafficking.
Arturo Favela-Gomez, 36, Topeka, Kan., who is charged with one count of conspiracy to distribute methamphetamine, four counts of distributing methamphetamine and 16 counts of using a phone in furtherance of drug trafficking.
Ismael Murillo-Nunez, 50k, Topeka, Kan., who is charged with one count of conspiracy to distribute methamphetamine, one count of distributing methamphetamine and 11 counts of using a phone in furtherance of drug trafficking.
Saul Salas-Gomez, 29, Topeka, Kan., who is charged with one count of conspiracy to distribute methamphetamine and five counts of using a phone in furtherance of drug trafficking.
Miguel Adame-Regino, who is charged with one count of conspiracy to distribute methamphetamine, two counts of distributing methamphetamine and four counts of using a phone in furtherance of drug trafficking.
Juan Carlos Flores-Rodriguez, 32, Grand Island, Neb., who is charged with one count of conspiracy to distribute methamphetamine and three counts of using a phone in furtherance of drug trafficking.
Chela Murillo, Topeka, Kan., who is charged with one count of conspiracy to distribute methamphetamine and three counts of using a phone in furtherance of drug trafficking.
Gustavo Gonzalez-Valadez, 26, Topeka, Kan., who is charged with one count of conspiracy to distribute methamphetamine and two counts of using a phone in furtherance of drug trafficking.
Jamie (last name unknown), who is charged with one count of conspiracy and four counts of using a phone in furtherance of drug trafficking.
Jerman Aldava, 28, Dodge City, Kan., who is charged with one count of conspiracy to distribute methamphetamine and nine counts of using a phone in furtherance of drug trafficking.
Jessica Howard, 30, Topeka, Kan., who is charged with one count of conspiracy to distribute methamphetamine and six counts of using a phone in furtherance of drug trafficking.
Robert Lovgren, 56, Manhattan, Kan., who is charged with one count of conspiracy to distribute methamphetamine and three counts of using a phone in furtherance of drug trafficking.
Lupita Gomez, 32, Kansas City, Kan., who is charged with one count of conspiracy to distribute methamphetamine.
Nancy Gutierrez-Soto, Topeka, Kan., who is charged with one count of conspiracy to distribute methamphetamine and two counts of using a phone in furtherance of drug trafficking.
Raul Cortes-Ponce, 52, Kansas City, Kan., who is charged with one count of conspiracy to distribute methamphetamine and five counts of using a phone in furtherance of drug trafficking.
Upon conviction, the crimes carry the following penalties:
– Conspiracy: Not less than 10 years in federal prison and not more than life and a fine up to $10 million.
– Using a phone in furtherance of drug trafficking: A maximum penalty of four years and a fine up to $250,000 on each count.The Drug Enforcement Administration and the Topeka Police Department investigated. Also assisting were the Kansas Highway Patrol, the Emporia Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives and Immigration and Customs Enforcement.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Hartford Man Sentenced to 45 Months in Federal Prison for Illegally Possessing AmmunitionRead the Press Release
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, today announced that ORLANDO NEALEY, 29, formerly of Willimantic and Hartford, was sentenced on Wednesday, July 3, by United States District Judge Robert N. Chatigny in Hartford to 45 months of imprisonment, followed by three years of supervised release, for illegally possessing ammunition.
According to court documents and statements made in court, on July 16, 2012, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) received information from the Hartford Police Department’s Shoot Team regarding five individuals who had purchased ammunition from a sporting goods store in East Hartford the previous day. All five of the individuals, including NEALEY, were convicted felons. The investigation revealed that NEALEY and others had purchased one box of 9mm ammunition, one box of .38 Special ammunition and one box of .45 Auto ammunition. Each of the boxes contained 50 rounds.
The investigation further revealed that the individuals stored firearms and ammunition in the basement of a residence on Pliny Street in Hartford. A court-authorized search of the residence revealed most of the ammunition that had been purchased on July 15, 2012, as well as a loaded 9mm handgun, a loaded .38 caliber revolver, a loaded pistol grip shotgun, and additional rounds of ammunition.
NEALEY has been detained since his arrest on July 20, 2012. On April 17, 2013, he pleaded guilty to one count of possession of ammunition by a previously convicted felon.
NEALEY’s criminal history includes felony convictions for sale of illegal drugs, possession of narcotics, larceny, burglary and violation of a protective order.
This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Hartford Police Department, with the assistance of the East Hartford Police Department. The case is being prosecuted by Assistant United States Attorney Geoffrey M. Stone.
PUBLIC AFFAIRS CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
[email protected]Former Alabama Corrections Officer Pleads Guilty to Obstructing Justice in Federal Criminal Civil Rights Investigation of Beating Death of an InmateRead the Press Release
The Justice Department announced today that Joseph Sanders, 32, a former corrections officer of the Alabama Department of Corrections, pleaded guilty to obstructing justice in an investigation into the beating death of former inmate Rocrast Mack.
On Aug. 4, 2010, 24-year-old Rocrast Mack was beaten by several corrections officers at Ventress Correctional Facility in Clayton, Ala. He was repeatedly struck by a baton in an office in the prison, and several minutes later he was assaulted again in the medical unit of the prison when an officer stomped on Mack’s head several times. Mack died the following day in a Montgomery, Ala., hospital. Following Mack’s death, Sanders lied to investigators from the Department of Corrections to cover up the fact that Mack was unjustly and brutally beaten.
Two weeks ago, on June 25, a federal jury convicted Michael Smith, a former lieutenant at Ventress, of civil rights and obstruction of justice violations regarding this incident. Scottie Glenn, another former corrections officer at Ventress, pleaded guilty on Nov.18, 2011, to one count of violating the civil rights of Mack for his role in the incident and to one count of conspiring with other corrections officers to cover up the beatings. Matthew Davidson, another former corrections officer, pleaded guilty on Jan. 15, 2013, to two civil rights violations and one count of conspiring with other officers to cover up the beatings.
Sentencing for all of the defendants is scheduled for Sept. 23, 2013. Sanders faces a statutory maximum potential penalty of 20 years in prison.
“Mr. Sanders, by his statements, attempted to conceal that Rocrast Mack’s brutal death was unjustly caused by the corrections officers to whose care he had been entrusted,” said Deputy Assistant Attorney General for the Civil Rights Division Roy L. Austin Jr. “Such actions have no place in our corrections system and the Department of Justice will continue to vigorously prosecute those who commit and cover up such crimes.”
This case was investigated by the Mobile, Ala., Division of the FBI, in partnership with the Alabama Bureau of Investigation, and was prosecuted by Trial Attorney Patricia Sumner of the Justice Department’s Civil Rights Division and Assistant U.S. Attorney Jerusha Adams of the U.S. Attorney’s Office for the Middle District of Alabama.
Former Alabama Corrections Officer Pleads Guilty in A Criminal Civil Rights Investigation of the Beating Death of an InmateRead the Press Release
Montgomery, Alabama - Montgomery, AL – The Justice Department announced today that Joseph Sanders, 32, a former corrections officer of the Alabama Department of Corrections, pleaded guilty to obstructing justice in an investigation into the beating death of former inmate Rocrast Mack.
On August 4, 2010, 24-year-old Rocrast Mack was beaten by several corrections officers at Ventress Correctional Facility in Clayton, Alabama. He was repeatedly struck by a baton in an office in the prison, and several minutes later he was assaulted again in the medical unit of the prison when an officer stomped on Mack’s head several times. Mack died the following day in a Montgomery, Ala., hospital. Following Mack’s death, Sanders lied to investigators from the Department of Corrections to cover up the fact that Mack was unjustly and brutally beaten.
Two weeks ago, on June 25, a federal jury convicted Michael Smith, a former lieutenant at Ventress, of civil rights and obstruction of justice violations regarding this incident. Scottie Glenn, another former corrections officer at Ventress, pleaded guilty on Nov.18, 2011, to one count of violating the civil rights of Mack for his role in the incident and to one count of conspiring with other corrections officers to cover up the beatings. Matthew Davidson, another former corrections officer, pleaded guilty on Jan. 15, 2013, to two civil rights violations and one count of conspiring with other officers to cover up the beatings.
Sentencing for all of the defendants is scheduled for September 23, 2013. Sanders faces a maximum potential penalty of 20 years in prison.
“Mr. Sanders, by his statements, attempted to conceal that Rocrast Mack’s brutal death was unjustly caused by the corrections officers to whose care he had been entrusted,” said Deputy Assistant Attorney General for the Civil Rights Division Roy L. Austin Jr. “Such actions have no place in our corrections system and the Department of Justice will continue to vigorously prosecute those who commit and cover up such crimes.”
“Correction officers have an incredibly difficult job. Most perform their job ethically, without abusing the inmates,” said U.S. Attorney for the Middle District of Alabama, George L. Beck, Jr. “However, these officers allowed a restrained man to be savagely beaten and stomped and then tried to cover it up. There is no excuse for such behavior. Hopefully, this plea will bring the Mack family some peace in knowing that no one is above the law.”
“This investigation represents the FBI’s unwavering commitment to protect all citizens from those who violate and abuse their positions of trust,” stated Stephen F. Richardson, FBI Special Agent in Charge, Mobile Division. “Public servants are bound by their oath to serve and protect our communities and any violation of a person’s civil rights will be met with severe consequences.”
This case was investigated by the Mobile, Ala., Division of the FBI, in partnership with the Alabama Bureau of Investigation, and was prosecuted by Trial Attorney Patricia Sumner of the Justice Department’s Civil Rights Division and Assistant U.S. Attorney Jerusha Adams of the U.S. Attorney’s Office for the Middle District of Alabama.
PRESS CONTACT: Clark Morris
Email: [email protected]
Telephone: (334) 551-1755
Fax: (334) 223-7617Final Defendant Sentenced in Operation Holiday ExpressRead the Press Release
GRAND RAPIDS, MICHIGAN – U.S. Attorney Patrick A. Miles, Jr. announced today that Samuel Aaron Collins of Gardena, California was sentenced by Chief U.S. District Judge Paul L. Malone to 11 years in prison for his participation in a cocaine conspiracy that trafficked thousands of kilograms of cocaine from California to Michigan for over a decade. Collins and eleven other co-conspirators were indicted by a Grand Jury in the Western District of Michigan on December 1, 2009. When law enforcement executed arrest warrants in California on December 2, 2009, Collins fled. Collins remained a fugitive from justice until a fugitive task force under the U.S. Marshals Service apprehended him in Aurora, Colorado in November 2012. On February 8, 2013, Collins pled guilty to three counts of using a telephone to facilitate the cocaine conspiracy. Each count carried a statutory maximum of four years imprisonment.
Collins, along with his childhood friend, drug kingpin Charles Jackson, Sr., began trafficking cocaine from California to Michigan in the mid-1990s. The two men were indicted in the Eastern District of Michigan in 1998. Collins pled guilty to interstate travel in aid of racketeering (“ITAR”) and served a five year prison sentence. Jackson, Sr. successfully eluded law enforcement for over a decade and remained a fugitive on the Eastern District of Michigan indictment. After Collins completed his ITAR sentence in 2004, he resumed cocaine trafficking with Jackson, Sr. Collins’ primary role was to manage the multiple couriers that transported the cocaine from California to Michigan, test the quality of the cocaine, prepare the cocaine for cross-country shipment, and drop off and pick up drug proceeds and transport vehicles on Jackson, Sr.’s behalf. Jackson, Sr. ultimately surrendered to law enforcement in 2010, after being indicted in the Western District of Michigan. Thereafter, he pled guilty to cocaine conspiracy and money laundering conspiracy charges and is presently serving a 27 year prison term.
Collins’ sentence marks the culmination of the Organized Crime and Drug Enforcement Task Force (“OCDETF”) investigation “Operation Holiday Express.” The investigation was led by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) and the Lansing Police Department. The investigation began with the bust of a street-level crack cocaine dealer in Lansing, Michigan in 2004. From there, investigators followed the drug and money trail to a Lansing street gang known as AHH DEE AHH, which was responsible for trafficking large quantities of cocaine, heroin, and marijuana between Detroit and Lansing from 2001 to 2006. Federal prosecution of AHH DEE AHH began in 2005, and resulted in the conviction of 27 members and associates. Investigators next identified AHH DEE AHH’s Detroit-based cocaine suppliers, who were prosecuted in 2007. The investigation turned westward in 2008 and resulted in the identification and prosecution of members and associates of two California-based drug trafficking organizations that supplied the cocaine being peddled in Detroit and Lansing. Charles Jackson, Sr. led one of these drug trafficking organizations with the assistance of Samuel Aaron Collins. The investigation revealed that over $176,000,000 of drug proceeds were generated by these two organizations. Including Collins, over forty defendants have been charged, convicted, and sentenced as a result of this investigation.
U.S. Attorney Miles praised the tenacity and dedication of the ATF and the Lansing Police Department. “The ATF, the Lansing Police Department, and the United States Attorney’s Office have worked hand-in-glove on this investigation for nearly a decade. Based on investigators’ dogged efforts, what began as the bust of a street-level crack cocaine dealer resulted in the prosecution and dismantlement of two drug trafficking organizations responsible for transporting thousands of kilograms of cocaine from California to Michigan for further redistribution throughout the Eastern and Western Districts of Michigan.” U.S. Attorney Miles also recognized the efforts of the U.S. Marshals Service in apprehending Collins, who remained a fugitive for nearly three years. “Those that decide to flee from justice should know that their day is coming. Ultimately, such individuals will be caught by the agency that investigated the case or by the U.S. Marshals Service.”
ATF Acting Special Agent in Charge Daryl McCrary commented: “This investigation is an example of ATF’s commitment and determination in making our communities safe. ATF’s Frontline strategy is our business model that addresses violent gun and narcotics trafficking crime. These accomplishments could not have been achieved without the collaboration and hard work of ATF, Lansing Police Department, and the United States Attorney’s Office.”
Lansing Police Chief Michael Yankowski stated: “The City of Lansing is highly appreciate of the partnerships it has established with the U.S. Attorney’s Office and the ATF. Only through this strong collaboration was it possible to dismantle such a large drug operation that crossed several states and required a multi-agency investigation. The City of Lansing and the country have benefitted greatly as a result of the elimination of these two drug trafficking organizations that terrorized our citizens with agony, gloom, and violent crime through the sale of narcotics. The City of Lansing, with the highest level of gratitude, thanks the U.S. Attorney’s Office for their tenacious, meticulous, and successful prosecution of these cases.”
Operation Holiday Express was prosecuted by Assistant U.S. Attorney Joel Fauson and former Assistant U.S. Attorney Brian Lennon.
END
Doctors Hospital of Augusta and Radiation Oncology Practice Pay More Than $1 Million to Resolve False Claims Act LitigationRead the Press Release
AUGUSTA, GA: Doctors Hospital of Augusta, LLC, which is owned and operated by the for-profit hospital chain, HCA Inc., and Radiation Oncology Associates, LLP, of Augusta, Georgia, have agreed to pay the United States a total of $1,020,000 to settle allegations that they submitted or caused the submission of false claims to the Medicare and TRICARE programs for certain radiation oncology procedures that were allegedly performed without the requisite level of physician supervision.
The civil settlement resolves allegations that were originally part of a federal lawsuit unsealed on July 3, 2013. The lawsuit was filed under the whistleblower provisions of the False Claims Act.
The case was investigated by Special Agent Ryan S. Coble, Department of Health and Human Services, Office of Investigations; Special Agent Randy J. Temples, Department of Defense, Defense Criminal Investigative Services; and Investigator Kimberly Reinken of the United States Attorney’s Office, Southern District of Georgia. The United States was represented by Assistant United States Attorney Scott R. Grubman.
For additional information, please contact First Assistant United States Attorney James D. Durham at (912) 201-2547.
Blackfoot Man Sentenced for Distributing MethRead the Press Release
POCATELLO – Ernesto Guerrero, 35, of Blackfoot, Idaho, was sentenced today in United States District Court to 60 months in prison for distribution of five grams or more of actual methamphetamine, U.S. Attorney Wendy J. Olson announced. U.S. District Judge Edward J. Lodge also ordered Guerrero to serve three years of supervised release. He pleaded guilty to the charge on March 18, 2013.
According to the plea agreement, on August 23, 2011, Guerrero arranged for and sold more than five grams of actual methamphetamine to another individual in exchange for $1,400. The distribution took place near Bannock and Truchot Roads in Fort Hall, Idaho. Guerrero admitted to knowing the substance he distributed was methamphetamine.
The case was investigated by Idaho State Police and the Fort Hall Police Department.
Armed Career Criminal Sentenced to 180 Months for Weapons and Drugs ChargesRead the Press Release
WILIMINGTON - United States Attorney Thomas G. Walker announced that in federal court on July 2, 2013 JOHN ALBRITTON, 64, of Chocowinity,, North Carolina, was sentenced by Senior United States District Judge James C. Fox to 180 months imprisonment and five years of supervised release for one count of Possession of Firearms and Ammunition by a Felon, in violation of Title 18, United States Code, Sections 922(g)(1) and 924 and two counts of Distributing a Quantity of Cocaine Base (Crack), in violation of Title 21, United States Code, Section 841(a)(1). In addition, the Court Ordered the Forfeiture of three shotguns and ammunition and one rifle.
On March 8, 2013 ALBRITTON was found guilty, following a three day trial in Wilmington, North Carolina of distributing a quantify of cocaine base (crack) on June 2, 2010 and May 25, 2010 and of possessing four firearms and ammunition on June 4, 2010.
After a joint investigation conducted by the Beaufort County Sheriff’s Office (BCSO) in Washington, North Carolina and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) in Wilmington, North Carolina, law enforcement established that ALBRITTON operated an illicit business, Lil’ John’s Club, from a building adjacent to his residence. At the club, patrons purchased alcohol and drugs from ALBRITTON, activity which dated from early 2008 and included numerous citizen complaints to BCSO for noise ordinance violations and assaults.
Assistant United States Attorney Thomas B. Murphy prosecuted the case.
Akron Man Sentenced to 10 Years in Prison for Leading Mortgage Fraud Scheme That Resulted in $36 Million LossRead the Press Release
An Akron man was sentenced to 10 years in prison for leading massive mortgage fraud schemes in Ohio and Florida, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio.
The restitution owed by Jack R. Coppernger, age 50, will be determined later this year. The government has asked for $35 million.
More than 40 people have been found guilty of crimes for their various roles in the mortgage fraud, which has led to losses of more than $36 million.
“This defendant led a ring whose crimes covered two states and resulted in losses of tens of millions of dollars,” Dettelbach said. “Mortgage fraud crimes devastate entire neighborhoods and communities.”
In delivering his sentence, U.S. District Judge John Adams said to Coppenger: “This was all greed. This was all planned, this scam and scheme. You knew and you had to know when this house of cards began to fall. You’re still out looking for new people to prey on.”
Coppenger previously pleaded guilty to two counts of conspiracy.
In the first count, Coppenger conspired to commit bank fraud and to make false statements to influence a bank to make a loan in connection with a mortgage fraud scheme involving property in the Panama City, Florida area, resulting in approximately a $36 million loss.
In the second count, Coppenger conspired to defraud the United States by impairing and impeding the ability of the I.R.S to assess Coppenger’s taxes in 2006 by concealing funds Coppenger received from a land “flip” conducted by Andrew Norman and Jason Herceg.
Norman and Herceg were both recently sentenced to 40 months in prison and ordered to pay $14 million in restitution.
According to court documents, they operated a company in Stow under the name of V.P. Equity LLC and, with Coppenger, procured “straw buyers” and submitted false loan documents to banks to purchase Coppenger’s lots in Florida (which had already been inflated in value as part of a land flip) in a mortgage fraud scheme.
Coppenger, with assistance from Herceg and Norman, perpetrated a large mortgage fraud scheme involving numerous straw buyers primarily from the Akron, Hartville, and Mentor areas. These straw buyers essentially sold their good credit scores to Coppenger in order for Coppenger to secure loans, through straw buyers’ names, for properties in Florida. Coppenger promised the straw buyers that if they signed the loan application and paperwork, Coppenger would pay them an inducement amount.
Coppenger then promised the straw buyers that he would make all the mortgage payments for the property and would make any down payments that were necessary, and that, once the property was developed and sold, they would split the profits equally.
Ultimately, Coppenger failed to make the mortgage payments on these loans, resulting in a loss of approximately $36 million, according to court documents.
Herceg and Norman defrauded two elderly purchasers by selling them a Florida property for $7 million. Moments before this sale, Herceg and Norman bought the property through their partnership, 104 Investments, from the original seller and inflated its value by approximately $2.6 million. Herceg and Norman then sold this property to these elderly purchasers, who were never told of the last minute “flip”, or that they were actually buying the land from Herceg, Norman, and 104 Investments. Herceg and Norman, and their 104 Investments business partner, Robert Jason Workman, received approximately $2.6 million from this sale which they then funneled portions of the proceeds out to themselves which included a $690,000 to Coppenger as payment for locating the property. Subsequently, Norman, Herceg, and Workman fraudulently deducted the money they gave to Coppenger as a business expense.
Coppenger was also conspired with business partner Kathleen A. Fada-Murray and her husband, Willliam Murray, to defraud the United States by concealing from the I.R.S. their receipt of monies from the fraudulent land flip. William Murray and Fada-Murray were not involved in the fraud against the elderly purchasers but were owed a return on her investment in Coppenger’s company, SMB&A. Once Fada-Murray became aware that Coppenger had received $690,000 as a result of the fraud in count one, she took steps to obtain some of this money herself, her husband, and others, and conspired with Coppenger to conceal their receipt of these funds from the I.R.S. by transferring funds into and out of accounts with corporate names, and out of an account in the name of Coppenger and his wife, characterizing these funds as a repayment of a loan, and using these funds to pay for Fada-Murray’s personal expenses, including online gambling debts, credit card payments, car payments, and federal and state taxes, as well as for personal expenses of Coppenger, including carpeting, car payments, and the payment of business expenses to keep the mortgage fraud scheme going.
Both Fada-Murray and William Murray pleaded guilty to their roles in this scheme. William Murray was also charged with recruiting two straw buyers for Coppenger in this scheme. Fada-Murray was sentenced to five years probation and ordered to pay back taxes while William Murray was sentenced to two years in prison and ordered to pay $450,440 in restitution. Workman was sentenced to six months in prison and ordered to pay $77,000.
Thus far, 37 straw buyers have pleaded guilty to a charged of conspiracy to commit loan fraud and bank fraud. All have been sentenced or are awaiting sentencing.
The case is being prosecuted by Assistant U.S. Attorneys Christian H. Stickan and Henry F. DeBaggis, following investigation by agents of the IRS-CI and FBI, Akron Office.
28 month prison sentence for Anchorage Woman for role in prison tax refund conspiraciesRead the Press Release
Anchorage, Alaska - U.S. Attorney Karen L. Loeffler announced today that an Anchorage resident was sentenced to prison for convictions of conspiracy to defraud the government and mail fraud.
Helen Delores Maloney, 45, of Anchorage, Alaska, was sentenced to 28 months in prison on July 2, 2013. Maloney pled guilty in April 2013 to conspiracy to defraud the government regarding false income tax refund claims and mail fraud. In addition to her prison sentence, a money judgment of $17,719 was entered against Maloney. She was also ordered to forfeit $23,160 seized from a residence and to pay restitution of $95,568.
According to court documents, Maloney was involved with two conspiracies between July 2009 and January 2012. The objective of both conspiracies was to obtain refunds by filing fraudulent income tax returns. Both schemes involved co-conspirators and victims who were inmates at correctional facilities.
Court documents revealed that the first conspiracy Maloney was involved in occurred between July 2009 and May 2011, when Maloney, co-conspirator John Koesterman, and others, prepared and submitted approximately 55 false tax returns claiming refunds of over $275,000. Koesterman was later indicted.
Court documents further indicate that the second conspiracy occurred between July 2010 and January 2012, when Maloney and co-conspirators Steven James McComb, Michael Lee Sexton, and Paulando Ramone Williams prepared and submitted approximately 21 false tax returns claiming refunds of over $51,000. Maloney submitted change of address forms for 20 victims of the scheme for whom her co-conspirators then submitted false tax returns, causing tax refund checks and other IRS correspondence to be mailed to her residence.
Maloney, McComb, Williams, and Sexton were indicted by a federal grand jury in February 2013, for conspiracy to defraud the government with respect to false claims; mail fraud; and aggravated identity theft. Their current status is as follows:
- McComb plead guilty to conspiracy to defraud the government with respect to claims, mail fraud, and aggravated identity theft on June 6, 2013, and is scheduled to be sentenced on August 22, 2013;
- Williams is scheduled to go to trial on September 23, 2013;
- Koesterman is scheduled to go to trial on August 19, 2013;
- Sexton is a fugitive.
Regarding Koesterman, Williams, and Sexton, 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.
Ms. Loeffler commends the Internal Revenue Service-Criminal Investigation Division, for conducting the investigation leading to Maloney’s successful prosecution.
10th Street Gang Member Sentenced on RICO ChargeRead the Press Release
BUFFALO, N.Y.-- U.S. Attorney William J. Hochul, Jr. announced today that Saul Santana, 26, of Buffalo, N.Y., who was convicted of Racketeering Influenced Corrupt Organizations (RICO) Conspiracy, was sentenced by U.S. District Judge Richard J. Arcara to 324 months in prison.
Assistant U.S. Attorney Joseph M. Tripi, who handled the case, stated that the defendant was a member of the 10th Street Gang, a criminal enterprise engaged in racketeering activity in Western New York. As part of his involvement in the 10th Street Gang, Santana shot and killed rival gang member Anthony Colon on June 26, 2009 in broad daylight. In addition, the defendant conspired to distribute cocaine, cocaine base, marijuana, and other controlled substances on the West Side of Buffalo as part of the affairs of the 10th Street Gang. Santana also possessed various firearms and guarded 10th Street territory and routinely resorted to violence to ensure that no rival gang members or narcotics dealers encroached upon their territory.
"This significant sentence should send a strong message to other groups or individuals that committing violence will not be tolerated," said U.S. Attorney Hochul. "Our Office will continue to work closely with our law enforcement partners to bring to justice those who attempt to hold our community hostage with such acts or through trafficking illegal narcotics."
The sentencing is the culmination of an investigation on the part of the Federal Bureau of Investigation, under the direction of Richard M. Frankel, Acting Special Agent in Charge, the New York State Police, under the direction of Major Michael Cerretto, and the Buffalo Police Department, under the direction of Commissioner Daniel Derenda.
Saturday 6 July 2013
Man Sentenced to over 11 Years in Federal Prison for Robbing Local Jewelry Store with Stolen HandgunRead the Press Release
LAS VEGAS, Nev. - A man who stole a handgun from his brother and used it to rob a local jewelry store, has been sentenced to 140 months in prison, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
John James Ericson, 33, of Las Vegas, was sentenced on Tuesday, July 2, 2013, by U.S. District Judge Andrew P. Gordon. Ericson pleaded guilty on March 25, 2013, to one count of interference with commerce by robbery.
On Oct. 10, 2012, at approximately 1:20 pm, Ericson went into a local jewelry store, approached the male owner, and stated he was looking for engagement rings. When the jewelry store owner opened the jewelry case to show Ericson some rings, Ericson produced a semi-automatic handgun and threatened him. Ericson then stole approximately $35,000 in jewelry from the open case and fled on foot. Because of statements Ericson had made during the robbery, law enforcement officials were able to identify Ericson, and he was arrested later the same day of the robbery. Law enforcement officials also determined that the handgun Ericson used during the robbery had been reported stolen by Ericson’s brother, who is an officer with the Las Vegas Metropolitan Police Department.
Ericson’s sentence was increased because he had several prior felony convictions in Florida for drug trafficking and possession.
The case was brought under DOJ’s Project Safe Neighborhoods (PSN) initiative, a nationwide commitment to reduce gun and gang crime in America.
The case was investigated by the FBI and Las Vegas Metropolitan Police Department, as part of the FBI’s Safe Streets Task Force, and prosecuted by Assistant U.S. Attorney Cristina D. Silva.
Friday 5 July 2013
Week in Review – HammondRead the Press Release
FOR IMMEDIATE RELEASECONTACT: Mary Hatton
www.usdoj.gov/usao/inn/ CELL: (219) 314-9993
Hammond, Indiana - The United States Attorney’s Office announced the following activity in Federal Court:
DISPOSITIONS:
James L. Williams, 45, of Kankakee, Illinois, was sentenced by Senior District Judge James Moody to 87 months imprisonment, restitution of $284,218.29 and 3 years of supervised release after pleading guilty to the felony offense of the armed bank robbery of Kentland Bank in Lake Village, Indiana.This case was the result of an investigation by the Federal Bureau of Investigation and the Newton County Police Department.This case was prosecuted by Assistant United States Attorney David Nozick.
Johana Jatzhiry Velazquez, 29, a Mexican national residing in Rensselaer, Indiana, was sentenced by District Judge Joseph Van Bokkelen to time already served and 2 years of supervised release after pleading guilty to the felony offense of conspiracy to possess with the intent to distribute cocaine.According to documents filed by the government in this case, Velazquez was responsible for assisting with the transportation of a significant amount of cocaine.This case was the result of an investigation by the Drug Enforcement Administration and the Illinois State Police.This case was prosecuted by Assistant United States Attorney Joshua Kolar.
Imaru Jones, 29, of Griffith, Indiana, was sentenced by Senior District Judge James Moody to 2 years of probation to include 8 months of home detention after pleading guilty to the felony offense of distribution of marijuana.According to documents filed by the government in this case, the offense involved the Jones selling approximately 8,642 grams of marijuana over the course of three sales to a confidential informant. This case was the result of an investigation by the Federal Bureau of Investigation.This case was prosecuted by Assistant United States Attorney Dean Lanter.
Miguel Villegas-Marin, 54, of Indianapolis, Indiana, a defendant in the case US v Montoya Gonzalez et al., was sentenced by Senior District Judge James Moody to 37 months imprisonment and 1 year of supervised release after pleading guilty to the felony offense of conspiracy to possess with the intent to distribute marijuana.According to documents filed by the government in this case, Villegas-Maris was involved in picking up a load of marijuana that was transported from Texas.This case was the result of an investigation by the Drug Enforcement Administration.This case was prosecuted by Assistant United States Attorney Joshua Kolar.
Robert Thompson, Jr., 25, of Gary, Indiana, was sentenced by Senior District Judge James Moody to 37 months imprisonment and 2 years of supervised release after pleading guilty to the felony offense of possession of a firearm and ammunition by a convicted felon.According to documents filed by the government in this case, an AK-47 rifle was found in a vehicle occupies by Thompson during a traffic stop.Thompson has prior convictions for dealing in cocaine in 2008 and a controlled substance crime in 2008.This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Gary Police Department.This case was prosecuted by Assistant United States Attorney Nicholas Padilla.
William Weigand, 43, of Portage, Indiana, was sentenced by District Judge Joseph Van Bokkelen to 6 months imprisonment, six months of home detention and 1 year of supervised release after pleading guilty to the felony offense of possession of a firearm by a convicted felon.According to documents filed by the government in this case, Weigand has a prior conviction for burglary in 1989.This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Federal Bureau of Investigation and the Indiana State Police.This case was prosecuted by Assistant United States Attorney David Nozick.
Linda Lyrla, 58, of Demotte, Indiana, was sentenced by Senior District Judge James Moody to 46 months imprisonment and 3 years of supervised release after pleading guilty to the felony offenses of mail fraud and tax evasion.Lyrla also was ordered to pay restitution totaling $1,426,057.85 to the victims and forfeiture of $1,384,600.00.According to documents filed by the government in this case, Lylra embezzled funds from her employer, Alliance Technology Group.In 2001, Lyrla began her scheme to siphon money by creating an internal fund for a credit card.During the next nine years, she used the credit card for personal purchases and paid the balances with company funds.She used the money to fund an extravagant lifestyle and did not pay income taxes to the IRS on her ill-gotten income. This case was the result of an investigation by the Internal Revenue Service and the Federal Bureau of Investigation.This case was prosecuted by Assistant United States Attorney Gary Bell.
Week in Review – Fort WayneRead the Press Release
FOR IMMEDIATE RELEASECONTACT: Mary Hatton
www.usdoj.gov/usao/inn/ CELL: (219) 314-9993
Fort Wayne, Indiana —The United States Attorney’s Office announced the following activity in Federal Court:
PLEAS:
Ron Luthe, 46, of Fort Wayne, Indiana, pled guilty before Magistrate Judge Roger B. Cosbey to the felony offense of being a felon in possession of a firearm. Magistrate Cosbey is recommending that the district court accept the tendered guilty plea.Parties have 10 days in which to object to the magistrate judge’s recommendation. This charge was filed as a result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives.This case is being prosecuted by Assistant United States Attorney Tina Nommay.
Rico Parrish, 27, of Warsaw, Indiana, pled guilty before Magistrate Judge Roger B. Cosbey to the felony offense of being a felon in possession of a firearm. Magistrate Cosbey is recommending that the district court accept the tendered guilty plea. Parties have 10 days in which to object to the magistrate judge’s recommendation. This charge was filed as a result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives.This case is being prosecuted by Assistant United States Attorney Anthony Gellar.
Juan Olivo, 36, of Milford, Indiana, pled guilty before Magistrate Judge Roger B. Cosbey to the felony offense of knowingly or intentionally distributing heroin. Magistrate Cosbey is recommending that the district court accept the tendered guilty plea.Parties have 10 days in which to object to the magistrate judge’s recommendation. This charge was filed as a result of an investigation by the Federal Bureau of Investigation.This case is being prosecuted by Assistant United States Attorney Anthony Geller.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
DISPOSITIONS:
Brandon Terry, 29, of Fort Wayne, Indiana, was sentenced by Judge Theresa L. Springmann to serve 37 months imprisonment (time served & ordered released) and 3 years supervised release after pleading guilty to the felony offense of possession with intent to distribute five (5) grams or more of crack cocaine.This case was the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Fort Wayne Police Department.This case was prosecuted by Assistant United States Attorney Tina Nommay.
U.S.Postal Service Mail Carrier Convicted for Involvement <br /> with Stolen Identity Refund Fraud ConspiracyRead the Press Release
On July 3, 2013, a jury found Vernon Harrison, of Montgomery, Ala., guilty of one count of conspiring to file false claims, eight counts of mail fraud, eight counts of aggravated identity theft and six counts of embezzlement from the U.S. mail, the Justice Department, the Internal Revenue Service (IRS) and the U.S. Postal Service, Office of the Inspector General (OIG), announced today.
According to the evidence presented at the trial, Harrison was a U.S. Postal Service mail carrier who was part of a stolen identity refund fraud conspiracy. Members of the conspiracy used stolen identities to file false tax returns from various locations, including houses and hotels around Birmingham, Ala. and Montgomery. They then had the fraudulently obtained tax refunds generated by those returns sent to debit cards which were subsequently mailed to addresses on Harrison’s postal route in Montgomery. In exchange for cash, Harrison stole the debit cards from the mail and provided them to a co-conspirator. Harrison stole, at a minimum, over 100 debit cards from the mail for his co-conspirators.As was shown at trial, federal agents uncovered substantial evidence of the conspiracy during the execution of search warrants at locations in Montgomery and near Birmingham, including over a hundred envelopes for debit cards that had been mailed to addresses on Harrison’s postal route. Soon after, agents also conducted surveillance on Harrison and observed him failing to deliver Turbo Tax cards that were in the mail.
Harrison faces up to 10 years in prison for the conspiracy count, 20 years for each mail fraud count, five years for each mail embezzlement count, and a mandatory two-year sentence for the aggravated identity theft counts. In total, Harrison could be sentenced to up to 216 years in prison. Harrison also could be subject to fines, forfeiture, and mandatory restitution.
Kathryn Keneally, Assistant Attorney General for the Justice Department's Tax Division, commended the efforts of special agents of IRS - Criminal Investigation and the U.S. Postal Service, OIG, who investigated the case, and Tax Division Trial Attorneys Jason Poole and Michael Boteler, who prosecuted the case.
Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at www.justice.gov/tax .U.S. Postal Service Mail Carrier Convicted for Involvement with Stolen Identity Refund Fraud ConspiracyRead the Press Release
WASHINGTON – On July 3, 2013, a jury found Vernon Harrison, of Montgomery, Ala., guilty of one count of conspiring to file false claims, eight counts of mail fraud, eight counts of aggravated identity theft and six counts of embezzlement from the U.S. mail, the Justice Department, the Internal Revenue Service (IRS) and the U.S. Postal Service, Office of the Inspector General (OIG), announced today.
According to the evidence presented at the trial, Harrison was a U.S. Postal Service mail carrier who was part of a stolen identity refund fraud conspiracy. Members of the conspiracy used stolen identities to file false tax returns from various locations, including houses and hotels around Birmingham, Ala. and Montgomery. They then had the fraudulently obtained tax refunds generated by those returns sent to debit cards which were subsequently mailed to addresses on Harrison's postal route in Montgomery. In exchange for cash, Harrison stole the debit cards from the mail and provided them to a co-conspirator. Harrison stole, at a minimum, over 100 debit cards from the mail for his co-conspirators.
As was shown at trial, federal agents uncovered substantial evidence of the conspiracy during the execution of search warrants at locations in Montgomery and near Birmingham, including over a hundred envelopes for debit cards that had been mailed to addresses on Harrison's postal route. Soon after, agents also conducted surveillance on Harrison and observed him failing to deliver Turbo Tax cards that were in the mail.
Harrison faces up to 10 years in prison for the conspiracy count, 20 years for each mail fraud count, five years for each mail embezzlement count, and a mandatory two-year sentence for the aggravated identity theft counts. In total, Harrison could be sentenced to up to 216 years in prison. Harrison also could be subject to fines, forfeiture, and mandatory restitution.
Kathryn Keneally, Assistant Attorney General for the Justice Department's Tax Division, commended the efforts of special agents of IRS - Criminal Investigation and the U.S. Postal Service, OIG, who investigated the case, and Tax Division Trial Attorneys Jason Poole and Michael Boteler, who prosecuted the case.
Additional information about the Justice Department's Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
U.S. Postal Service Mail Carrier Convicted for Involvement with Stolen Identity Refund Fraud ConspiracyRead the Press Release
Montgomery, Alabama - On July 3, 2013, a jury found Vernon Harrison, of Montgomery, Ala., guilty of one count of conspiring to file false claims, eight counts of mail fraud, eight counts of aggravated identity theft and six counts of embezzlement from the U.S. mail, announced George L. Beck, Jr., U.S. Attorney for the Middle District of Alabama.
According to the evidence presented at the trial, Harrison was a U.S. Postal Service mail carrier who was part of a stolen identity refund fraud conspiracy. Members of the conspiracy used stolen identities to file false tax returns from various locations, including houses and hotels around Birmingham, Ala. and Montgomery. They then had the fraudulently obtained tax refunds generated by those returns sent to debit cards which were subsequently mailed to addresses on Harrison’s postal route in Montgomery. In exchange for cash, Harrison stole the debit cards from the mail and provided them to a co-conspirator. Harrison stole, at a minimum, over 100 debit cards from the mail for his co-conspirators.
As was shown at trial, federal agents uncovered substantial evidence of the conspiracy during the execution of search warrants at locations in Montgomery and near Birmingham, including over a hundred envelopes for debit cards that had been mailed to addresses on Harrison’s postal route. Soon after, agents also conducted surveillance on Harrison and observed him failing to deliver Turbo Tax cards that were in the mail.
“We trust our mail carriers to deliver, not steal our mail,” stated U.S. Attorney Beck. “Harrison abused that trust. Harrison and his criminal organization not only stole innocent people’s identities, filed fraudulent tax returns and received tax refunds not owed to them, but they used Harrison’s position as a mail carrier to steal these debit cards from the mail. This criminal behavior will not be tolerated and will be prosecuted to the fullest extent of the law.”
Harrison faces up to 10 years in prison for the conspiracy count, 20 years for each mail fraud count, five years for each mail embezzlement count, and a mandatory two-year sentence for the aggravated identity theft counts. In total, Harrison could be sentenced to up to 216 years in prison. Harrison also could be subject to fines, forfeiture, and mandatory restitution.
U.S. Attorney Beck commended the efforts of special agents of IRS - Criminal Investigation and the U.S. Postal Service, OIG, who investigated the case, and Tax Division Trial Attorneys Jason Poole and Michael Boteler, who prosecuted the case.
Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
PRESS CONTACT: Clark Morris
Email: [email protected]
Telephone: (334) 551-1755
Fax: (334) 223-7617ICE deports man wanted for kidnapping and murder in El SalvadorRead the Press Release
WASHINGTON - A Salvadoran national, who was previously removed from the United States and who is wanted in his native country for homicide, aggravated kidnapping and robbery, was turned over to authorities in El Salvador Friday by U.S. Immigration and Customs Enforcement's (ICE) Enforcement and Removal Operations (ERO).
Melvin Noe Lazo-Sanchez aka Melvin Noe Sanchez-Izaguirre, 34, a citizen of El Salvador and Honduras, was flown to El Salvador July 5 onboard a charter flight coordinated by ICE's Air Operations (IAO) Unit. Upon arrival, the suspect was turned over to officials from the El Salvadoran Civilian National Police (PNC).
“Mr. Lazo has been deported to El Salvador where he will now face a criminal court to answer to his charges, thanks to a dedicated group of deportation officers and ICE attorneys who serve to protect our communities here in Virginia,” said M. Yvonne Evans, field office director for ERO Washington. “Because of our far reaching impact, our officers maintain a global vision and are proud when justice is served, no matter where in the world.”
Lazo-Sanchez was arrested March 15 outside his residence in Manassas, Va., by officers of ERO Washington's fugitive operations team. An ERO officer assigned to INTERPOL Washington notified the team of an active Red Notice on Sanchez by law enforcement in San Salvador.
Sanchez illegally re-entered the United States after ICE removed him to Honduras in June 2012. He evaded extradition from Honduras to El Salvador when he was removed in 2012 because the last name he used on his Honduran identity differed from his El Salvadorian identity. Sanchez was ordered removed from the United States to Honduras or El Salvador by an immigration judge May 2.
The deportation of fugitive Melvin Lazo-Sanchez is another example of expanded bi-national cooperation to identify, arrest and repatriate Salvadoran criminal suspects who have fled to the United States to avoid prosecution. ICE officers are working closely with the PNC, the Salvadoran National INTERPOL Office and Salvadoran Immigration as part of this effort. In the first nine months of fiscal year 2013, the PNC executed more than 101 criminal arrest warrants with fugitives being returned to El Salvador aboard IAO removal flights. Many of those arrests involved homicide-related charges or other violent crimes.
Since Oct. 1, 2009, ERO has removed more than 640 foreign fugitives from the United States who were being sought in their native countries for serious crimes, including kidnapping, rape and murder. ERO works with the Office of International Affairs for ICE's Homeland Security Investigations' (HSI) foreign consular offices in the United States and INTERPOL to identify foreign fugitives illegally present in the country.
This removal was coordinated with HSI El Salvador, ICE's Office of Chief Counsel in Arlington, the Consulate of El Salvador and INTERPOL Washington.
Florida Telemarketer Pleads Guilty for His Role in Timeshare ScamRead the Press Release
On July 1, 2013, Stephen R. Wigginton, United States Attorney for the Southern District of Illinois, announced that Robert Thomas, 36, of Lake Worth, Florida, pled guilty to a one-count information. Sentencing has been set for October 28, 2013. The charge arose out of a telemarketing scam which operated in Palm Beach County, Florida, that bilked over 22,000 victims of $30 million dollars. Consumers were victimized in all fifty states, the District of Columbia and Puerto Rico, all ten Canadian provinces and the Northwest Territory of Canada. There were at least 54 victims in twenty seven (27) of the thirty eight (38) counties comprising the Southern District of Illinois.
Mr. Thomas was a telemarketer who worked for Creative Vacation Solutions and Universal Marketing Solutions and conducted a telemarketing timeshare resale scheme targeting timeshare owners throughout the United States and Canada. Creative Vacation Solutions and Universal Marketing Solutions falsely represented that they had found buyers for the consumers’ timeshare interests and solicited fees of up to several thousand dollars from each consumer in purported pre-paid closing costs and related expenses. In fact, the purported sales did not occur, closings were not scheduled as was often represented, and Creative Vacation Solutions and Universal Marketing Solutions did not successfully sell any consumer’s timeshare interest. The companies devoted essentially no resources to marketing their clients’ timeshare interests and simply pocketed the fees.
Multiple others have been charged in connection with this scam. On June 30, 2011, Jennifer Kirk pled guilty to a criminal information. She was sentenced on January 9, 2012 to over 16 years in prison and five years’ supervised release. On August 17, 2011, a federal grand jury in East St. Louis charged Steve Folan, Ryan Brazel, and Brian Morris in a multi-count indictment for their involvement in the alleged scheme. Folan, Brazel, and Morris pled guilty. Brazel was sentenced on June 29, 2012 to 121 months in prison and three years’ supervised release. Folan was sentenced to 60 months in prison and three years’ supervised release. Morris was sentenced to 168 months and five years’ supervised release. Joel Intravaia pled guilty to conspiracy in an information filed on August 19, 2011. He was sentenced to 60 months in prison and three years’ supervised release on December 9, 2011. Ralph Johnson entered a guilty plea to conspiracy charges filed in a criminal information on September 8, 2011. He was sentenced on December 16, 2011 to 46 months in prison and two years’ supervised release. On September 21, 2011, Kenneth Foote and Joseph Grizzanti were indicted by a federal grand jury in East St. Louis. On October 7, 2011, each filed a consent to transfer their case to the U.S. District Court for the Southern District of Florida in order to plead guilty to the charges there. On May 11, 2012 in the Southern District of Florida, Foote was sentenced to 60 months in prison and Grizzanti to 72 months, respectively. Jeffrey Tracey Fields was charged with conspiracy in a criminal information on October 25, 2011. He filed a consent to transfer his case to the U.S. District Court for the Southern District of Florida in order to plead guilty to the charges there. Fields was sentenced to 101 months in prison. John Thomas Egan pled guilty to conspiracy charges filed in a criminal information on January 6, 2012. Egan was sentenced to 90 months in prison. On January 20, 2012 David Johnson and Erin Todd were indicted by a federal grand jury in East St. Louis. Johnson pled guilty and received 36 months in prison. Todd’s case was tried before a jury in September 2012. Todd was found guilty and sentenced to 42 months in prison. In March 2012, John Robert Eddy, Cloyd James Holmes, Jr., Gino Christopher Marquez, and Donald Myers were indicted by a federal grand jury in East St. Louis for conspiracy to commit wire fraud and mail fraud. Eddy pled guilty and received 60 months in prison; Holmes pled guilty and is awaiting sentencing; Marquez pled guilty and received 70 months in prison; and Myers pled guilty and received 30 months in prison. In April 2012, Daniel L. Gregg, Joshua G. Schneidau, and Lacey Marie Stone were indicted for conspiracy to commit wire fraud and mail fraud. Gregg pled guilty and received 27 months in prison; Schneidau pled guilty and received 60 months in prison; and Stone pled guilty and is awaiting sentencing. In May 2012, Anthony Colon, Troy Dye, Chris Gilkey, Marc Martinangelo, and Robert Santiago were indicted for conspiracy to commit wire fraud and mail fraud. Colon pled guilty and received 70 months in prison; Dye pled guilty and received 41 months in prison; Gilkey pled guilty and received 27 months in prison; Martinangelo pled guilty and received 1 year plus 1 day in prison; and Santiago pled guilty and received 20 months in prison. In July 2012, Daniel James Ferrara and Robert Schmucker were indicted for conspiracy to commit wire fraud and mail fraud. Both Ferrara and Schmucker pled guilty and are awaiting sentencing. On May 31, 2013, Hank Quimby pled guilty to a criminal information. He is awaiting sentencing. On June 13, 2013, Harrison Pomerantz pled guilty to a criminal information. He, too, is waiting to be sentenced.
The criminal charges follow an investigation by the St. Louis Field Office of the Chicago Division of the United States Postal Inspection Service, the Florida Attorney General’s Office, the Florida Department of Agriculture and Consumer Services, and the Boynton Beach Florida Police Department. The prosecution of the case is being handled by Assistant U.S. Attorneys Bruce E. Reppert, Katherine L. Lewis, and Nathan D. Stump, and U.S. Attorney Stephen R. Wigginton.
Fairfax County Man Sentenced to 300 Months for Producing Child Pornography and Attempted Enticement of A MinorRead the Press Release
ALEXANDRIA, Va. – Douglas Lee Payne, Jr., 31, of Fairfax County, Va., was sentenced today to 300 months in prison, followed by a lifetime period of supervised release, for charges of production of child pornography and attempted enticement of a minor.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; and Colonel Edwin C. Roessler, Jr., Acting Fairfax County Chief of Police, made the announcement after sentencing by United States District Judge Leonie M. Brinkema.
Payne pleaded guiltyon April 8, 2013. According to court documents, during the investigation of a Fairfax County probation violation in December 2011, electronic communications between Payne and two minor females, one in Indiana and another in Pennsylvania, were discovered. In these communications, Payne asked the minor victims for nude images and instructed them on how to pose. Payne had a least one child pornography image of each minor victim, which, as he had requested, had been sent to him. Payne and the minor victim in Indiana also had conversations about Payne going on a trip to Indiana to visit family and having sex with the minor on his trip home to Virginia. On December 28, 2011, Payne was on his way to Indiana when he was instructed to come home for a meeting with his Fairfax County probation officer.
This case was investigated by the Fairfax County Police Department and the FBI Washington Field Office’s Child Exploitation Task Force. Special Assistant United States Attorney Alicia J. Yass, a Trial Attorney with the Child Exploitation and Obscenity Section of the Justice Department’s Criminal Division, is prosecuting the case on behalf of the United States.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.
Wednesday 3 July 2013
William Lawrence Barrow Pleads Guilty in U.S. Federal CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Billings, on July 2, 2013, before U.S. District Judge Sam E. Haddon, WILLIAM LAWRENCE BARROW, a 40-year-old resident of Clearfield, Utah, pled guilty to conspiracy to possess with intent to distribute heroin and methamphetamine. Sentencing has been set for October 7, 2013. He is currently detained.
In an Offer of Proof filed by Assistant U.S. Attorney Jessica T. Fehr, the government stated it would have proved at trial the following:
On January 10, 2013, a Montana Highway Patrol (MHP) Trooper observed a vehicle on Interstate 94 near Glendive that failed to have visible registration tags. The Trooper approached the passenger side window of the vehicle and detected the odor of raw marijuana coming from within the suspect vehicle. The driver of the vehicle was identified as R.B. The passenger of the vehicle was identified as M.C.
The Trooper was given permission to search the vehicle by the registered owner, M.C. During the search, the Trooper discovered a backpack inside the vehicle. M.C. advised the backpack did not belong to him. Likewise, R.B. also denied owning the backpack. In the backpack law enforcement found numerous items of drug paraphernalia such as tin foil, a torch, numerous small plastic baggies, and a locked box. Inside the locked box there were two bags containing powdery substances. One bag field tested positive for heroin and weighed approximately 2 ounces. The second bag field tested positive for methamphetamine and weighted approximately 1.5 ounces.
The investigation revealed that R.B. and M.C. drove from Dickinson, North Dakota, to Billings on January 9, 2013. They stayed at a local motel in Billings and while at the motel, R.B. went to another room and stayed for about 2 hours. R.B. was meeting with his source of supply for methamphetamine and heroin. It was believed the male source of supply was still staying at the motel in Billings. R.B. and M.C. had previously traveled to Billings just before New Year's Day, 2013, to pick up more drugs from the same source of supply.
Law enforcement returned to the motel in Billings and discovered the source of supply, BARROW, was still staying at the motel.
Agents obtained a search warrant for the motel room. Just prior to executing the search warrant agents noticed BARROW and the female with him were packing up their car and preparing to leave the motel. Agents detained BARROW and the female passenger until a K9 Officer was able to arrive and conduct an exterior sniff test of the vehicle BARROW was driving. The K9 alerted on the vehicle.
The car and the motel room were searched by law enforcement. Agents found syringes, plastic baggies, two computers, four cellular phones - which contained several text messages between BARROW and R.B. - a leather notebook with drug ledger, a flash drive, and a false bottom Arizona Iced tea can.
BARROW was detained at the Billings DEA Office. Agents seized $2,503.22 from BARROW's person along with approximately three (3) ounces of heroin wrapped in a plastic bag.
Further investigation revealed that BARROW was R.B.'s main drug connection out of Utah. BARROW had historical distributed at least 100 grams of methamphetamine and 100 grams of heroin to R.B. during the course of the conspiracy.
BARROW faces possible penalties of a mandatory minimum of 5 years in prison and could be sentenced to 40 years, a $2,000,000 fine, and 4 years supervised release.
The illegal activities described in this case were in part attributable to the demand currently being noted in the areas referred to as the "Bakken Boom." The change of plea in this case is a direct result of the cooperative efforts of the Drug Enforcement Agency and the Montana Division of Criminal Investigations in those communities directly affected by the population influx due to the Bakken.
Warren County Man Sentenced to 28 Years in Prison on Federal Child Pornography ChargesRead the Press Release
St. Louis, MO - RANDALL PAUL ABERNATHY, Warrenton, MO, was sentenced to 339 months in prison for his production and transportation of child pornography between September 2010 and September 2011. Abernathy pled guilty in January. He appeared today for sentencing in St. Louis before United States District Judge Catherine D. Perry.
This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Erin Granger handled the case for the U.S. Attorney’s Office.
Virginia-Based Corporation Agrees to Pay $5.75 Million to Resolve False Claims Act AllegationsRead the Press Release
Tampa, FL – The Justice Department announced today that Science Applications International Corporation (SAIC) will pay $5.75 million to the federal government to resolve a lawsuit alleging violations of the False Claims Act. SAIC, headquartered in McLean, Virginia, is a defense contractor that provides professional engineering and other services to various agencies and departments of the United States.
The lawsuit centered on a General Services Administration Blanket Purchase Agreement (BPA) awarded to SAIC, in September 2006, for the provision of professional engineering and consulting services. Those services aided non-traditional assessment (NTA) work, which is the study and evaluation of the military utility of new products and emerging technologies. Through nineteen Task Orders issued under the BPA, SAIC performed NTA work for multiple DOD entities including U.S. Central Command at MacDill Air Force Base in Tampa, as well as the Coalition and Irregular Warfare Center at Nellis AFB in Las Vegas, Nevada. The General Services Administration (GSA) is an agency of the United States Government. Through its Federal Acquisition Service, GSA assists in the management and support of other federal agencies and government components through the provision of products and services to them. In some instances, GSA will assist a federal government agency by issuing a competitive contract solicitation for services required by that agency.
The United States contends that SAIC personnel aided others to induce GSA to issue the BPA solicitation by misleading GSA personnel into believing they were issuing the BPA on behalf of a federal government agency. In fact, the solicitations were issued on behalf of an entity associated with a state institution in New Mexico. An employee of that state institution was appointed to review cost proposals and billings by SAIC, but failed to discharge his duties independently by, among other things, not properly reviewing and vetting cost and scope of work estimates prepared by SAIC. Additionally, the government alleges that SAIC, and others, promoted the BPA to various DOD entities as a contract vehicle that had already been subject to competition, thereby bypassing truly competitive bidding on that work.
Pursuant to the settlement, SAIC will make a one-time payment of $5,750,000.00 to the United States. The DOD entities will retain all work performed, or work product created by SAIC, under the BPA. The U.S. will not pay any further monies for that work, nor remit or refund any monies to SAIC for that work.
“Federal contracts must be awarded based on full disclosure and fair dealing,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division of the Department of Justice. “It is completely unacceptable for taxpayer dollars to be paid under circumstances where the integrity of the contracting process has been undermined.” “This recovery illustrates the emphasis and resources we place on detection and recovery of fraud, waste, and abuse in government procurement contracts – particularly those involving defense contractors and others who supply goods and services to the Department of Defense, the branches of our military, and their bases,” said Robert E. O’Neill, U.S. Attorney for the Middle District of Florida."SAIC received a contract, awarded by GSA, from a fictitious government agency," said GSA Inspector General Brian D. Miller. "This deceptive scheme shows that we must be on the lookout for all forms of contract fraud."
The lawsuit was filed by a whistleblower (also known as a relator), under the qui tam provisions of the False Claims Act, which allows private parties to file suit on behalf of the United States and share in any recovery. Timothy Ferner, a former active-duty Lt. Colonel assigned to the CIWC, made the allegations which initiated the government’s investigation. Ferner will receive a $977,500.00 share of the recovery from SAIC.
This case was investigated jointly by Assistant U.S. Attorney Charles Harden of the United States Attorney’s Office for the Middle District of Florida, Trial Attorneys Don Williamson and Niall O’Donnell of the Commercial Litigation Branch of the Justice Department’s Civil Division, and Assistant Special Agent in Charge James Taylor of the Atlanta Office of the Inspector General for GSA. Substantial investigative support was also provided by agents from the Tampa Resident Agency of the Defense Criminal Investigative Service, the Melbourne Major Procurement Fraud Unit of the U.S. Army Criminal Investigation Command, and the MacDill Detachment of the Air Force Office of Special Investigations.
The claims settled by today’s agreement are allegations only; there has been no determination of liability.
Veteran Affairs Employee Indicted for Sale of Veterans' Identity InformationRead the Press Release
Tampa, Florida - United States Attorney Robert E. O'Neill announces the unsealing of an indictment yesterday charging David F. Lewis with wrongful disclosure of health information, access device fraud, and aggravated identity theft. If convicted, Lewis faces a maximum penalty of ten years in federal prison on each count of wrongful disclosure of health information and ten years’ imprisonment on each count of access device fraud, all to be followed by up to two years for each aggravated identity theft offense. The Indictment also notifies Lewis that the United States is seeking a money judgment in the amount of $105,271.00, the proceeds of the charged criminal conduct.
According to the indictment and court documents, Lewis was a Department of Veterans Affairs employee who stole the identities of patients at the James A. Haley Veterans Hospital. Lewis then sold those identities to others, who used them to file fraudulent U.S. income tax returns and obtain fraudulent tax refunds.
Special Agent in Charge Quentin G. Aucoin of the Veterans Affairs, Office of the Inspector General, stated, "These crimes are particularly egregious, and the VA Office of Inspector General is dedicated to aggressively investigating individuals who misuse patient information, especially when used for personal and financial gain."
Special Agent in Charge James Robnett of the Internal Revenue Service - Criminal Investigation stated, "The indictment and arrest of David F. Lewis by members of the Tampa Bay Alliance, in partnership with the US Attorney's office, demonstrates the continued commitment the members of the alliance have in investigating identity theft and stolen identify refund fraud that is in the Tampa Bay area. The alliance will continue to vigorously investigate this crime which has victimized the most vulnerable citizens in the Tampa Bay area."
An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Department of Veterans Affairs - OIG, the Internal Revenue Service - Criminal Investigation, the Tampa Police Department, and the Florida Highway Patrol. It will be prosecuted by Assistant United States Attorney Sara C. Sweeney.
Two Buffalo Women Charged in Tax SchemeRead the Press Release
BUFFALO, N.Y.--U.S. Attorney William J. Hochul, Jr. announced today that a federal grand jury has returned an indictment charging Keianna A. Jones, 27, and Dominique N. Taylor, 27, both of Buffalo, N.Y., with conspiracy to defraud the government with respect to claims and assisting in the preparation of false income tax returns. The conspiracy charge carries a maximum sentence of 10 years in prison and a $250,000 fine and the false income tax return charge carries a maximum sentence of three years in prison and a $100,000 fine.
Assistant U.S. Attorney Robert C. Moscati, who is handling the case, stated that according to the indictment, the defendants obtained blank W-2 forms from local businesses and prepared false W-2 forms. Jones and Taylor then assisted others in filing false returns using the fraudulent W-2s. This resulted in numerous individuals receiving income tax refunds to which they were not entitled.
The indictment is the culmination of an investigation on the part of Special Agents of the Internal Revenue Service - Criminal Investigation Division, under the direction of New York Field Office Special Agent- in-Charge Toni M. Weirauch.The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Two Aryan Brotherhood of Texas Gang Members Plead Guilty to Federal Racketeering ChargesRead the Press Release
Two members of the Aryan Brotherhood of Texas gang (ABT) pleaded guilty today to racketeering charges related to their membership in the ABT’s criminal enterprise, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas.
Glen Ray Millican, aka “Fly,” 39, and Justin Christopher Northrup, aka “Ruthless,” 28, both of Houston, each pleaded guilty before U.S. District Judge Sim Lake in the Southern District of Texas to one count of conspiracy to participate in racketeering activity.
According to court documents, Millican, Northrup and other ABT gang members and associates agreed to commit multiple acts of murder, robbery, arson, kidnapping and narcotics trafficking on behalf of the ABT gang. Millican, Northrup and numerous ABT gang members met on a regular basis at various locations throughout Texas to report on gang-related business, collect dues, commit disciplinary assaults against fellow gang members and discuss acts of violence against rival gang members, among other things.
By pleading guilty to racketeering charges, Millican and Northrup admitted to being members of the ABT criminal enterprise and agreeing to commit multiple acts of violence and/or narcotics trafficking on behalf of the ABT.
According to the superseding indictment, the ABT was established in the early 1980s within the Texas prison system. The gang modeled itself after and adopted many of the precepts and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to the superseding indictment, previously, the ABT was primarily concerned with the protection of white inmates and white supremacy/separatism. Over time, the ABT expanded its criminal enterprise to include illegal activities for profit.
Court documents allege that the ABT enforced its rules and promoted discipline among its members, prospects and associates through murder, attempted murder, conspiracy to murder, arson, assault, robbery and threats against those who violate the rules or pose a threat to the enterprise. Members, and oftentimes associates, were required to follow the orders of higher-ranking members, often referred to as “direct orders.”
According to the superseding indictment, in order to be considered for ABT membership, a person must be sponsored by another gang member. Once sponsored, a prospective member must serve an unspecified term, during which he is referred to as a prospect, while his conduct is observed by the members of the ABT.
At sentencing, scheduled for Sept. 26, 2013, Millican and Northrup each face a maximum penalty of life in prison.
Millican and Northrup are two of 36 defendants charged with conducting racketeering activity through the ABT criminal enterprise, among other charges. They are the seventh and eighth defendants, respectively, to plead guilty.
This case is being investigated by a multi-agency task force consisting of the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Drug Enforcement Administration; FBI; U.S. Marshals Service; Federal Bureau of Prisons; U.S. Immigration and Customs Enforcement Homeland Security Investigations; Texas Rangers; Texas Department of Public Safety; Montgomery County, Texas, Sheriff’s Office; Houston Police Department – Gang Division; Texas Department of Criminal Justice – Office of Inspector General; Harris County, Texas, Sheriff’s Office; Atascosa County, Texas, Sheriff’s Office; Orange County, Texas, Sheriff’s Office; Waller County, Texas, Sheriff’s Office; Alvin, Texas, Police Department; Carrollton, Texas, Police Department; Mesquite, Texas, Police Department; Montgomery County District Attorney’s Office; and the Atascosa County District Attorney’s Office.The case is being prosecuted by the Criminal Division’s Organized Crime and Gang Section and the U.S. Attorney’s Office of the Southern District of Texas.
Two Aryan Brotherhood of Texas Gang Members Plead Guilty to Federal Racketeering ChargesRead the Press Release
HOUSTON - Two members of the Aryan Brotherhood of Texas gang (ABT) pleaded guilty today to racketeering charges related to their membership in the ABT’s criminal enterprise, announced United States Attorney Kenneth Magidson and Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division.
Glen Ray Millican, aka “Fly,” 39, and Justin Christopher Northrup, aka “Ruthless,” 28, both of Houston, each pleaded guilty before U.S. District Judge Sim Lake in the Southern District of Texas to one count of conspiracy to participate in racketeering activity.
According to court documents, Millican, Northrup and other ABT gang members and associates agreed to commit multiple acts of murder, robbery, arson, kidnapping and narcotics trafficking on behalf of the ABT gang. Millican, Northrup and numerous ABT gang members met on a regular basis at various locations throughout Texas to report on gang-related business, collect dues, commit disciplinary assaults against fellow gang members and discuss acts of violence against rival gang members, among other things.
By pleading guilty to racketeering charges, Millican and Northrup admitted to being members of the ABT criminal enterprise.
According to the superseding indictment, the ABT was established in the early 1980s within the Texas prison system. The gang modeled itself after and adopted many of the precepts and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to the superseding indictment, previously, the ABT was primarily concerned with the protection of white inmates and white supremacy/separatism. Over time, the ABT expanded its criminal enterprise to include illegal activities for profit.
Court documents allege that the ABT enforced its rules and promoted discipline among its members, prospects and associates through murder, attempted murder, conspiracy to murder, arson, assault, robbery and threats against those who violate the rules or pose a threat to the enterprise. Members, and oftentimes associates, were required to follow the orders of higher-ranking members, often referred to as “direct orders.”
According to the superseding indictment, in order to be considered for ABT membership, a person must be sponsored by another gang member. Once sponsored, a prospective member must serve an unspecified term, during which he is referred to as a prospect, while his conduct is observed by the members of the ABT.
At sentencing, scheduled for Sept. 26, 2013, at 2:00 p.m., Millican and Northrup each face a maximum penalty of life in prison.
Millican and Northrup are two of 36 defendants charged with conducting racketeering activity through the ABT criminal enterprise, among other charges. They are the seventh and eighth defendants, respectively, to plead guilty.
This case is being investigated by a multi-agency task force consisting of the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Drug Enforcement Administration; FBI; U.S. Marshals Service; Federal Bureau of Prisons; Homeland Security Investigations; Texas Rangers; Texas Department of Public Safety; Montgomery County Sheriff’s Office; Houston Police Department-Gang Division; Texas Department of Criminal Justice – Office of Inspector General; sheriff’s offices in Harris, Tarrant, Atascosa, Orange and Waller Counties; police departments in Alvin, Carrollton and Mesquite Texas; as well as the Montgomery and Atascosa County District Attorney’s Offices.The case is being prosecuted by the U.S. Attorney’s Office of the Southern District of Texas and the Criminal Division’s Organized Crime and Gang Section.
Two Area Men Plead Guilty to Federal Charges Including the Assault of A Federal OfficerRead the Press Release
St. Louis, MO - FREDERICK CRAYTON, St. Louis City, pled guilty to federal gun and assault charges involving the April 18, 2013, assault of a federal officer. His brother DWAYNE CRAYTON, pled guilty yesterday to charges of selling crack cocaine to an undercover officer. Both defendants appeared before United States District Judge Audrey G. Fleissig in St. Louis.
According to court documents, on April 15, 2013, Dwayne Crayton sold crack cocaine to an undercover agent. Three days later on April 18, 2013, his brother Frederick and James Jones arranged to sell three firearms to an ATF undercover agent and two Confidential Informants. During a struggle involving several firearms, Frederick Crayton assaulted the undercover agent in an attempt to rob the agent of the money that was to be used to buy the three firearms.
Co-defendant James Edward Jones, also of St. Louis City, was indicted in April on related charges and awaits trial.
These charges carry a penalty range of5 to 25 years in prison and/or fines up to $1,000,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges. Sentencings have been set for October 2013.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. The remaining defendant is presumed to be innocent unless and until proven guilty.
This case was investigated by the Bureau of Alcohol, Tobacco and Firearms. Assistant United States Attorney Tom Mehan is handling the case for the U.S. Attorney’s Office.Twenty-Fifth Defendant Pleads Guilty in Manhattan Federal Court in Connection with Lirr Disability Fraud SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Martin J. Dickman, Inspector General of the Railroad Retirement Board (“RRB-OIG”), George Venizelos, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Barry L. Kluger, Inspector General of the New York State Metropolitan Transportation Authority (“MTA-OIG”), announced that ROBERT ELLENSOHN, a former bridges and buildings inspector for the Long Island Railroad (“LIRR”), pled guilty today for his role in the allegedly massive fraud scheme in which LIRR workers claimed to be disabled upon early retirement so that they could receive disability benefits to which they were not entitled. ELLENSOHN pled guilty in Manhattan federal court before U.S. District Judge Sidney H. Stein. He is the 33rd defendant to be charged, and the 25th defendant to plead guilty in the case, which alleges a pervasive pattern of fraudulent disability claims being filed with the U.S. Railroad Retirement Board (“RRB”) by retiring LIRR employees.
According to the Information filed today and statements made in other public filings and in court:
The LIRR Disability Fraud Scheme
The RRB is an independent U.S. agency that administers benefit programs, including disability benefits, for the nation’s railroad workers and their families. A unique LIRR contract allowed employees to retire at the relatively young age of 50 – the age of eligibility has since changed to 55 – if they had been employed by the LIRR for at least 20 years. Eligible employees are entitled to receive an LIRR pension, which is a portion of the full retirement payment for which they are eligible at 65. In addition, at full retirement age (between age 60 and age 65 depending on years of service), they are eligible to receive an RRB retirement pension. For LIRR workers who retired at 50 with only an LIRR pension, they would receive less than their prior salary and substantially lower pension payments than those to which they would be entitled at full retirement age. However, LIRR employees who retired and claimed disability could receive a disability payment from the RRB on top of their LIRR pension, regardless of age. A retiree’s LIRR pension, in combination with RRB disability payments, can be roughly equivalent to the base salary earned during his or her career.
Hundreds of LIRR employees have allegedly exploited the overlap between the LIRR pension and the RRB disability program by pre-planning the date on which they would falsely declare themselves disabled so that it would coincide with their projected retirement date. These false statements, made under penalty of prosecution in disability applications, allowed LIRR employees to retire as early as age 50 with an LIRR pension, supplemented by the fraudulently obtained RRB disability annuity. From 1995 through 2011, more than 75% of LIRR employees stopped working and began receiving RRB disability benefits, whereas during this same period, only 25% of retiring Metro-North employees stopped working and began receiving RRB disability benefits. During the period 2004 through 2008, only three doctors were responsible for approximately 86% of the disability claims submitted by LIRR retirees. Of these, one has died and one, Dr. Peter J. Ajemian, pled guilty and admitted that he declared “large numbers of Long Island Railroad employees” to be disabled even though they were not disabled and could have continued working in their railroad jobs. Dr. Ajemian was sentenced in May 2013 to eight years in prison.
ELLENSOHN, 59, of North Merrick, New York, pled guilty to one count of conspiracy to commit mail fraud, wire fraud, and health care fraud; one count of conspiracy to defraud the United States and the RRB; and one count of wire fraud. He faces a maximum sentence of 45 years in prison. ELLENSOHN is scheduled to be sentenced by Judge Stein on January 8, 2014.
Thirty-three people have been charged in connection with the LIRR disability fraud scheme, 25 of whom have now pled guilty. Of the 25 defendants that have pled guilty, two have been sentenced. The charges against the remaining defendants are merely allegations, and they are all presumed innocent unless and until proven guilty.
Mr. Bharara praised the work of the RRB-OIG, the FBI, and the MTA-OIG for their outstanding work in the investigation, which he noted is ongoing. He also acknowledged the previous investigation conducted by the New York State Attorney General’s Office into these pension fraud issues.
The case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorneys Justin Weddle, Nicole Friedlander, and Daniel Tehrani are in charge of the prosecution.
Twenty-Fifth Defendant Pleads Guilty in Manhattan Federal Court in Connection with LIRR Disability Fraud SchemeRead the Press Release
Preet Bharara, the United States Attorney for the Southern District of New York, Martin J. Dickman, Inspector General of the Railroad Retirement Board (“RRB-OIG”), George Venizelos, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Barry L. Kluger, Inspector General of the New York State Metropolitan Transportation Authority (“MTA-OIG”), announced that ROBERT ELLENSOHN, a former bridges and buildings inspector for the Long Island Railroad (“LIRR”), pled guilty today for his role in the allegedly massive fraud scheme in which LIRR workers claimed to be disabled upon early retirement so that they could receive disability benefits to which they were not entitled. ELLENSOHN pled guilty in Manhattan federal court before U.S. District Judge Sidney H. Stein. He is the 33rd defendant to be charged, and the 25th defendant to plead guilty in the case, which alleges a pervasive pattern of fraudulent disability claims being filed with the U.S. Railroad Retirement Board (“RRB”) by retiring LIRR employees.
According to the Information filed today and statements made in other public filings and in court:
The LIRR Disability Fraud Scheme
The RRB is an independent U.S. agency that administers benefit programs, including disability benefits, for the nation’s railroad workers and their families. A unique LIRR contract allowed employees to retire at the relatively young age of 50 – the age of eligibility has since changed to 55 – if they had been employed by the LIRR for at least 20 years. Eligible employees are entitled to receive an LIRR pension, which is a portion of the full retirement payment for which they are eligible at 65. In addition, at full retirement age (between age 60 and age 65 depending on years of service), they are eligible to receive an RRB retirement pension. For LIRR workers who retired at 50 with only an LIRR pension, they would receive less than their prior salary and substantially lower pension payments than those to which they would be entitled at full retirement age. However, LIRR employees who retired and claimed disability could receive a disability payment from the RRB on top of their LIRR pension, regardless of age. A retiree’s LIRR pension, in combination with RRB disability payments, can be roughly equivalent to the base salary earned during his or her career.
Hundreds of LIRR employees have allegedly exploited the overlap between the LIRR pension and the RRB disability program by pre-planning the date on which they would falsely declare themselves disabled so that it would coincide with their projected retirement date. These false statements, made under penalty of prosecution in disability applications, allowed LIRR employees to retire as early as age 50 with an LIRR pension, supplemented by the fraudulently obtained RRB disability annuity. From 1995 through 2011, more than 75% of LIRR employees stopped working and began receiving RRB disability benefits, whereas during this same period, only 25% of retiring Metro-North employees stopped working and began receiving RRB disability benefits. During the period 2004 through 2008, only three doctors were responsible for approximately 86% of the disability claims submitted by LIRR retirees. Of these, one has died and one, Dr. Peter J. Ajemian, pled guilty and admitted that he declared “large numbers of Long Island Railroad employees” to be disabled even though they were not disabled and could have continued working in their railroad jobs. Dr. Ajemian was sentenced in May 2013 to eight years in prison.
ELLENSOHN, 59, of North Merrick, New York, pled guilty to one count of conspiracy to commit mail fraud, wire fraud, and health care fraud; one count of conspiracy to defraud the United States and the RRB; and one count of wire fraud. He faces a maximum sentence of 45 years in prison. ELLENSOHN is scheduled to be sentenced by Judge Stein on January 8, 2014.
Thirty-three people have been charged in connection with the LIRR disability fraud scheme, 25 of whom have now pled guilty. Of the 25 defendants that have pled guilty, two have been sentenced. The charges against the remaining defendants are merely allegations, and they are all presumed innocent unless and until proven guilty.
Mr. Bharara praised the work of the RRB-OIG, the FBI, and the MTA-OIG for their outstanding work in the investigation, which he noted is ongoing. He also acknowledged the previous investigation conducted by the New York State Attorney General’s Office into these pension fraud issues.
The case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorneys Justin Weddle, Nicole Friedlander, and Daniel Tehrani are in charge of the prosecution.
U.S. v. Robert Ellensohn Information
Tucson Man Sentenced to 51 Months for Bank Robbery SpreeRead the Press Release
OAKLAND – Raymond David Lopez was sentenced today to 51 months in prison for a string of bank robberies he committed in May and June of 2012, announced United States Attorney Melinda Haag.
Lopez pleaded guilty on April 3, 2013, to six counts of bank robbery. According to the plea agreement, Lopez admitted to robbing the following banks of the amounts, and on the dates, listed below by using verbal demands, a demand note, and intimidation:
- $2,475 from a U.S. Bank branch in Pleasanton, California, on May 9, 2012
- $2,606 from a U.S. Bank branch in Pleasant Hill, California, on May 13, 2012
- $1,409 from a First Community Bank branch in Alameda, California, on May 26, 2012
- $1,135 from a Bank of America branch in Lafayette, California, on May 29, 2012
- $4,900 from a U.S. Bank branch in Alameda, California, on June 4, 2012
- $756 from a U.S. Bank branch in Dublin, California, on June 12, 2012
Lopez also admitted to the following bank robberies outside of the Northern District of California, which he accomplished in similar fashion:
- $7,214 from a River City Bank branch in Roseville, California, on April 26, 2012
- $3,542 from another River City Bank branch on May 2, 2012
- $4,000 from a Woodforest National Bank branch in Amarillo, Texas, on April 14, 2012
All stolen funds were insured by the FDIC.
Mr. Lopez, 30, of Tucson, Arizona, was indicted by a federal grand jury on August 30, 2012. He was charged in the Indictment with six counts of bank robbery in violation of Title 18, United States Code, Section 2113(a).
The sentence was handed down by the Honorable Phyllis J. Hamilton, U.S. District Court Judge, following a guilty plea to all six counts alleged in the Indictment. Judge Hamilton also sentenced the defendant to a three-year period of supervised release and ordered the defendant to pay a total of $28,037 in restitution to the victim banks. The defendant remained in custody and will immediately begin serving the sentence immediately.
Andrew S. Huang and Christina McCall are the Assistant U.S. Attorneys who prosecuted the case with the assistance of Vanessa Vargas. The prosecution is the result of an investigation by the Federal Bureau of Investigation, in conjunction with the Dublin Police Department, Pleasanton Police Department, El Cerrito Police Department, Pleasant Hill Police Department, Alameda Police Department, Contra Costa County Sheriff’s Office, Alameda County Sheriff’s Department, and Roseville Police Department.
(Lopez Indictment )
Trans1, Inc. to Pay U.s. $6 Million to Settle False Claims Act AllegationsRead the Press Release
Baltimore, Maryland – Medical device manufacturer TranS1, Inc., now known as Baxano Surgical, Inc., has agreed to pay the United States $6 million to resolve allegations under the civil False Claims Act that the company caused health care providers to submit false claims to Medicare and other federal health care programs for minimally-invasive spine surgeries.
The settlement was announced today by United States Attorney for the District of Maryland Rod J. Rosenstein; Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division; Daniel R. Levinson, Inspector General of the U.S. Department of Health and Human Services; Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service - Mid-Atlantic Field Office; and Special Agent in Charge Drew Grimm, Office of Personnel Management, Office of Inspector General.
This settlement resolves allegations that TranS1 knowingly caused health care providers to submit claims with incorrect diagnosis or procedure codes for certain minimally-invasive spine fusion surgeries in which physicians used TranS1’s AxiaLIF System™, a device developed as an alternative to invasive spine fusion surgeries. The United States further alleges that TranS1 improperly counseled physicians and hospitals to bill for the AxiaLIF System™ by using incorrect and inaccurate codes intended for more invasive spine fusion surgeries. As a result, the United States contends that health care providers received greater reimbursement than they were entitled to for performing the minimally-invasive AxiaLIF procedures.
“A medical device manufacturer violates the law when it advises physicians and hospitals to report the wrong codes to federal health insurance programs in order to increase reimbursement rates,” said Rod J. Rosenstein, United States Attorney for the District of Maryland. “Health care providers are required to bill federal health care programs truthfully for the work they perform.”
“The Justice Department is committed to ensuring that medical device manufacturers follow the law when providing devices to beneficiaries of federal health care programs,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division. “It is critical that health care providers bill federal health care programs accurately and honestly for the work they perform, and it is imperative that they base their selection of medical devices on the best interests of their patients, not on whether a device manufacturer is paying them for promotional speaking or consulting.”
The settlement also resolves allegations that TranS1 knowingly paid illegal remuneration to certain physicians for participating in speaker programs and consultant meetings intended to induce them to use TranS1 products, in violation of the Federal Anti-Kickback Statute, and thereby caused false claime to be submitted to federal health care programs. The Anti-Kickback Statute, prohibits offering or paying remuneration to induce referrals of items or services covered by federally-funded programs and is intended to ensure that a physician’s medical judgments are not compromised by improper financial incentives and are based solely on the best interests of the patient.
Finally, the settlement resolves the United States’ allegations that TranS1 promoted the sale of its AxiaLIF System™ for uses that were not approved or cleared by the U.S. Food and Drug Administration, including in certain procedures to treat complex spine deformity, which were not covered by federal health care programs.
As part of the settlement, TranS1 has agreed to enter into a corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services. That agreement provides for procedures and reviews to be put in place to avoid and promptly detect similar conduct.
“Using kickbacks to encourage health providers to make false payment claims will not be tolerated,” said Daniel R. Levinson, Inspector General of the U.S. Department of Health and Human Services. “TranS1's agreement to now comply with government health laws is encouraging.”
The civil settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and obtain a portion of the government’s recovery. The civil lawsuit was filed in the District of Maryland and is captioned United States ex rel. Kevin Ryan v. TranS1, Inc. As part of today’s resolution, Mr. Ryan will receive $1,020,000 from the settlement.
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $10.7 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14.5 billion.
The settlement was a result of an investigation by the U.S. Attorney’s Office for the District of Maryland, the Justice Department’s Civil Division, the Inspector General of Department of Health and Human Services, the Department of Defense Criminal Investigative Services and the Inspector General for the Office of Personnel Management. The case was handled by Assistant U.S. Attorneys Thomas Barnard and Thomas Corcoran and Trial Attorney Colin Huntley of the Justice Department Civil Division.
Tony Ray Many Guns Pleads Guilty in U.S. Federal CourtRead the Press Release
The United States Attorney's Office announced that during a federal court session in Great Falls, on July 2, 2013, before U.S. Magistrate Judge Keith Strong, TONY RAY MANY GUNS, a 36-year-old resident of Browning and an enrolled member of the Blackfeet Tribe, pled guilty to assault resulting in serious bodily injury. Sentencing has been set for October 21, 2013. He is currently detained.
In an Offer of Proof filed by Assistant U.S. Attorney Ryan G. Weldon, the government stated it would have proved at trial the following:
On February 28, 2013, MANY GUNS' wife was sleeping at a friend's home in Browning, which is within the exterior boundaries of the Blackfeet Indian Reservation. At approximately 2:00 a.m., MANY GUNS showed up at the residence after drinking "downtown." He knocked on the bedroom window so that his wife would let him inside, but she did not open the window. MANY GUNS instead entered the house through the front door and was angry that his wife failed to aid in his entrance. While they were both in bed, MANY GUNS began to hit his wife by striking her in the mouth and in the cheek with a closed fist. MANY GUNS' wife started to return blows but soon rolled onto her stomach and buried her face in the mattress in an effort to protect herself.
MANY GUNS continued to hit his wife and eventually stuck her index finger in his mouth and bit down "as hard as he could." In an effort to get MANY GUNS to release her finger, his wife used her left hand to dig into MANY GUNS' eye. MANY GUNS let go and then used both of his hands to strangle his wife. MANY GUNS' wife recalled making gasping and choking noises and began to pray out loud. MANY GUNS said, "You better pray."
The physical altercation stopped for a short time, and MANY GUNS told his wife that he wanted something to eat. He made his wife go with him. Once in the kitchen, MANY GUN's wife said something that angered him. MANY GUNS responded by slamming her into the wall near the refrigerator. He then grabbed his wife around the neck and strangled her until she lost consciousness. MANY GUNS' wife did not know how long she was unconscious, but when she regained consciousness, MANY GUNS was holding her up by her arms in the same spot. She reached out and pushed at MANY GUNS and slapped him in the face. MANY GUNS returned fire, using a closed fist to strike her in the mouth, which caused bleeding. MANY GUNS gave his wife a towel and said, "Don't bleed on my floor."
The next day, MANY GUNS' wife soaked her finger in an attempt to prevent infection. MANY GUNS' wife eventually told him, "It felt like you were [going] [to] bite my finger off." MANY GUNS responded, "I was trying to." He then told her that she should not try to fight back.
MANY GUNS' wife went to the hospital because her finger became infected and she was unable to move it. The injury to the finger of MANY GUNS' wife was extremely painful. She received Lortab, which is a narcotic drug, for the pain and was required to go through IV therapy.
On March 4, 2013, MANY GUNS was interviewed about his wife's finger. MANY GUNS initially said that he did not remember anything happening to his wife's finger. After further questioning, MANY GUNS eventually recalled that his wife was upset and yelled that she hated him. While trying to get his wife to calm down, MANY GUNS stated that his wife reached forward and pressed a finger into his eyes. MANY GUNS claimed that was when he bit her finger. MANY GUNS acknowledged that he bit his wife's finger for one minute and remembered that she was screaming, crying, and bleeding profusely.
MANY GUNS faces possible penalties of 10 years in prison, a $250,000 fine and 3 years supervised release.
The investigation was a cooperative effort between the Federal Bureau of Investigation and the Bureau of Indian Affairs.
Three More Charged in Scheme to Defraud BP Oil Spill Claims FundRead the Press Release
BIRMINGHAM – Federal prosecutors this week charged three more people as part of a conspiracy to fraudulently take money from funds established to pay claims from individuals and businesses harmed by the 2010 Deepwater Horizon oil spill in the Gulf of Mexico, announced U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Richard D. Schwein Jr.In separate informations filed Monday in U.S. District Court, the U.S. Attorney's Office charged JEREMY JAMAL BELL, 24, and ANTHONY KEITH BIVINS, 42, both of Birmingham, and CAMETRICA L. MENIFIELD, 31, of Bessemer, with conspiring in 2011 to participate in a scheme to defraud the Gulf Coast Claims Facility. Combined, the three defendants were paid about $138,881 from the oil spill claims funds. All three defendants have signed plea agreements with the government expressing their intention to plead guilty to the charges.
The U.S. Attorney's Office has now charged eight people with conspiring to defraud the oil spill claims funds, and the first five have pled guilty.
British Petroleum, which owned the Macondo oil well where the Deepwater Horizon drilling rig exploded, established the Gulf Coast Claims Facility in June 2010 for the purpose of administering and settling claims resulting from the oil spill disaster. A subsidiary of BP established the Deepwater Horizon Oil Spill Trust Fund in August 2010 to pay certain types of claims and expenses from the oil spill, including claims settled through the GCCF.
Bell, Bivins and Menifield are each charged with independently agreeing to provide personal information, such as Social Security numbers and bank account information, to individuals who recruited them so that they could use the information to file fraudulent claims for lost wages with the GCCF. The recruiters are not named in the charging documents. After the fraudulent claims were paid to Bell, Bivins and Menifield, each of them returned part of the money to the individuals who recruited them to participate in the scheme, according to the informations and plea agreements.The GCCF paid Bell $42,877 from the Deepwater Horizon Oil Spill Trust Fund on Aug. 9, 2011, according to the court documents. Later that month, Bell withdrew $42,402 from his account and gave it to the person who recruited him to participate in the scheme, according to the documents.
Bivins received about $61,987 in claim funds in October 2011. On Oct. 29, 2011, according to his information and plea agreement, he cashed the claims check, used some of it to buy money orders and a prepaid $5,000 debit card, as directed, and turned it all over to a co-conspirator. He was given $5,000 and the prepaid debit card in return.
Menifield received about $34,023 from the GCCF on July 21, 2011, according to her information and plea agreement. On July 22, 2011, she gave about $24,000 to a co-defendant and kept about $10,000, according to the documents.
The FBI investigated these cases. Assistant U.S. Attorney Henry Cornelius is prosecuting the cases.
Three Men Sentenced After Pleading to Violations of the Racketeer Influenced Corrupt Organization Act, the Federal Gun Control and Controlled Substances Acts, and Obstruction of JusticeRead the Press Release
MELVIN HUDSON, age 26, MOSES LAWSON, age 27, and TEDRICK REYNARD, age 24, all of Harvey, Louisiana were sentenced today before U.S. District Judge Lance M. Africk after pleading guilty to Violations of the Racketeer Influenced Corrupt Organization Act, the Violent Crime in Aid of Racketeering Act, the Federal Gun Control and Controlled Substances Acts, Aiding and Abetting, and Obstruction of Justice.
MELVIN HUDSON was sentenced to twenty-five (25) years imprisonment and ten (10) years of supervised release. HUDSON pled guilty to Count 1: Conspiracy to Violate the Racketeer Influence and Corrupt Organizations Act (“RICO”), in violation of Title 18, United States Code, Section 1962(d); Count 2: Conspiracy to Distribute and Possess with Intent to Distribute over 280 grams of Cocaine Base (“crack”), in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(A), and 846; Count 5: Conspiracy to Possess Firearms, in violation of Title 18, United States Code, Section 924(o); Count 6: Obstruction of Justice, in violation of Title 18, United States Code, Section 1519; Count 15: Distribution of a Quantity of Heroin, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C); Count 16: Prohibited Person in Possession of a Firearm, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2); Count 17: Possession with Intent to Distribute Cocaine Base (“crack”), in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C); and Count 18: Possession of a Firearm in Furtherance of a Drug Trafficking Crime, in violation of Title 18, United States Code, Section 924(c)(1)(A)(i). Melvin Hudson pled guilty pursuant to an 11(c)(1)(C) plea agreement.
MOSES LAWSON was sentenced to twenty-five (25) years imprisonment and ten (10) years of supervised release. LAWSON was also ordered to pay restitution to the victim’s family in the amount of $8,000.00. LAWSON pled guilty to Count 1: Conspiracy to violate the Racketeer Influence and Corrupt Organizations Act (“RICO”), in violation of Title 18, United States Code, Section 1962(d); Count 2: Conspiracy to Distribute and Possess with Intent to Distribute over 280 grams of Cocaine Base (“crack”), in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(A), and 846; Count 7: Prohibited Person in Possession of a Firearm, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2); and Count 8: Person in Possession of a Stolen Firearm, in violation to Title 18, United States Code, Sections 922(j) and 924(a)(2). LAWSON admitted that both he and other Murder Squad members participated in the murder Reginald Francois on April 1, 2010. LAWSON pled guilty pursuant to an 11(c)(1)(C) plea agreement.
TEDRICK REYNARD was sentenced to twenty (20) imprisonment and ten (10) years of supervised release. REYNARD pled guilty to Count 1:Conspiracy to violate the Racketeer Influence and Corrupt Organizations Act (“RICO), in violation of Title 18, United States Code, Section 1962(d); Count 2: Conspiracy to Distribute and Possess with Intent to Distribute over 280 grams of Cocaine Base (“crack”), in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(A), and 846; Count 5: Conspiracy to Possess Firearms, in violation of Title 18, United States Code, Section 924(o); Count 20: Distribution of a Quantity of Cocaine Base (“crack”), in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C); and Count 22: Possession with Intent to Distribute a Quantity of Cocaine Base (“crack”), in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C).
This case arose out of a joint investigation by the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco and Firearms, and the Jefferson Parish Sheriff’s Office. This investigation targeted an area which exhibited a disproportionate amount of violent crimes and narcotics trafficking. During the course of the investigation, specific individuals were identified as the main perpetrators of many of the violent acts and much of the narcotics distribution. Federal and local law enforcement officers interviewed witnesses, confidential informants, as well as state defendants, relative to the targeted individuals. It was revealed that a group of individuals operated in various areas of Harvey, Louisiana, specifically the neighborhoods known as Scottsdale and Haydel. This group controlled these areas for their narcotics distribution activities through violence and through threats of violence, to include murder, attempted murder, obstruction and assaults. They were referred to as the Harvey Hustlers and/or Murder Squad.
The “Murder Squad,” or “MS,” was a faction of the Harvey Hustlers composed primarily of individuals residing in the Harvey, Louisiana area of Jefferson Parish, Louisiana. While they primarily operated on the Westbank of Jefferson Parish, members conducted business in other parts of the Eastern District of Louisiana. The “Harvey Hustlers” also referred to as “HH” originated in the Harvey area in the mid-1980s. Members of the organization “hustled” meaning they distributed illegal narcotics.
The case was investigated by the Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco and Firearms, and the Jefferson Parish Sheriff’s Office. The case was being prosecuted by Assistant United States Attorneys Duane A. Evans and Bill McSherry.
Tacoma, Wash. Medical Firm to pay $14.5 Million to Settle Overbilling AllegationsRead the Press Release
WASHINGTON - Sound Inpatient Physicians Inc. will pay $14.5 million to settle allegations that it overbilled Medicare and other federal health care programs, the Justice Department announced today. Sound Physicians is a Tacoma, Wash.-based provider of hospitalists and other physicians to hospitals and other medical facilities. It employs more than 700 hospitalists and post-acute physicians, who provide services at 70 hospitals and a growing network of post-acute facilities in 22 states.
“Physicians who participate in Medicare and other federal health care programs must document and bill for their services accurately and honestly,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division. “The Department of Justice is committed to ensuring that Medicare and other federal funds are expended appropriately.”
Today’s settlement addresses allegations that, between 2004 and 2012, Sound Physicians knowingly submitted to federal health benefits programs inflated claims on behalf of its hospitalist employees for higher and more expensive levels of service than were documented by hospitalists in patient medical records. Hospitalists are physicians, typically trained in internal medicine, who provide care exclusively to hospital inpatients and have no office or outpatient practice.
“Fraudulently inflated billing of government health care programs puts those programs at risk, and impacts the system’s ability to care for the neediest in our communities,” said Jenny A. Durkan, U.S. Attorney for the Western District of Washington. “During this time of tight government budgets, we will do all we can to make sure everyone plays by the rules and does not run up the taxpayers’ tab.”
Allegations that Sound Physicians had improperly billed a variety of federal health care programs were brought to the government’s attention through a lawsuit filed by a former Sound Physicians employee, Craig Thomas, under the qui tam, or whistleblower, provisions of the False Claims Act. The act allows private citizens to bring civil actions on behalf of the government and share in any recovery. Thomas will receive $2.7 million of the $14.5 million settlement for exposing Sound Physicians’ inflated claims.
This civil settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $14.7 billion through False Claims Act cases, with more than $10.7 billion of that amount recovered in cases involving fraud against federal health care programs.
The Sound Physicians settlement was the result of a coordinated effort by the Department of Justice, Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the Western District of Washington; the Department of Health and Human Services Office of Inspector General; the Department of Defense, Office of Inspector General, Defense Criminal Investigative Service; the Office of Personnel Management Office of Inspector General; the Department of Veterans’ Affairs Office of Inspector General; and the TRICARE Management Activity Office of General Counsel.
The lawsuit is United States of America ex rel. Craig Thomas v. Sound Inpatient Physicians, Inc. and Robert A. Bessler, Civil Action No. C09-5301RBL (W.D. Wash.). The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Tacoma, Wash., Medical Firm to Pay $14.5 Million <br /> to Settle Overbilling AllegationsRead the Press Release
Sound Inpatient Physicians Inc. will pay $14.5 million to settle allegations that it overbilled Medicare and other federal health care programs, the Justice Department announced today. Sound Physicians is a Tacoma, Wash.-based provider of hospitalists and other physicians to hospitals and other medical facilities. It employs more than 700 hospitalists and post-acute physicians, who provide services at 70 hospitals and a growing network of post-acute facilities in 22 states.
“Physicians who participate in Medicare and other federal health care programs must document and bill for their services accurately and honestly,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division. “The Department of Justice is committed to ensuring that Medicare and other federal funds are expended appropriately.”
Today’s settlement addresses allegations that, between 2004 and 2012, Sound Physicians knowingly submitted to federal health benefits programs inflated claims on behalf of its hospitalist employees for higher and more expensive levels of service than were documented by hospitalists in patient medical records. Hospitalists are physicians, typically trained in internal medicine, who provide care exclusively to hospital inpatients and have no office or outpatient practice.
“Fraudulently inflated billing of government health care programs puts those programs at risk, and impacts the system’s ability to care for the neediest in our communities,” said Jenny A. Durkan, U.S. Attorney for the Western District of Washington. “During this time of tight government budgets, we will do all we can to make sure everyone plays by the rules and does not run up the taxpayers’ tab.”
Allegations that Sound Physicians had improperly billed a variety of federal health care programs were brought to the government’s attention through a lawsuit filed by a former Sound Physicians employee, Craig Thomas, under the qui tam, or whistleblower, provisions of the False Claims Act. The act allows private citizens to bring civil actions on behalf of the government and share in any recovery. Thomas will receive $2.7 million of the $14.5 million settlement for exposing Sound Physicians’ inflated claims.
This civil settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $14.7 billion through False Claims Act cases, with more than $10.7 billion of that amount recovered in cases involving fraud against federal health care programs.
The Sound Physicians settlement was the result of a coordinated effort by the Department of Justice, Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the Western District of Washington; the Department of Health and Human Services Office of Inspector General; the Department of Defense, Office of Inspector General, Defense Criminal Investigative Service; the Office of Personnel Management Office of Inspector General; the Department of Veterans’ Affairs Office of Inspector General; and the TRICARE Management Activity Office of General Counsel.
The lawsuit is United States of America ex rel. Craig Thomas v. Sound Inpatient Physicians, Inc. and Robert A. Bessler, Civil Action No. C09-5301RBL (W.D. Wash.). The claims resolved by the settlement are allegations only, and there has been no determination of liability.