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Tuesday 23 October 2012
Department of Health and Human Services Employee Sentenced in North Carolina to Prison for Theft of Government FundsRead the Press Release
WASHINGTON – An employee of the Department of Health and Human Services (HHS) was sentenced today in Asheville, N.C., to six months in prison for stealing $114,494 in government funds, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and Special Agent in Charge Elton Malone of the U.S. Department of Health and Human Services Office of the Inspector General (HHS-OIG), Office of Investigations, Special Investigations Branch.
Jihan S. Cover, 34, of Arden, N.C., was sentenced today by U.S. District Judge Martin Reidinger in the Western District of North Carolina. In addition to her prison term, Cover was ordered to forfeit $114,494, pay $114,494 in restitution to HHS and serve three years of supervised release, including six months of home confinement, following her prison term.Cover pleaded guilty to one count of theft on Aug. 22, 2011.
According to court documents, Cover worked as a purchasing agent with the National Institutes of Health (NIH), National Cancer Institute (NCI), a subdivision of HHS, from approximately 2006 through December 2011. Cover’s sole job function involved procuring authorized items and services for NIH/NCI using assigned government credit cards.
According to plea documents, between June 2009 and December 2010, Cover, who received regular training in the proper use of government credit cards, used and caused to be used NIH/NCI credit cards assigned to her to complete over 250 unauthorized personal transactions totaling approximately $114,494.During this period of time, according to her plea, Cover used and caused to be used her NIH/NCI purchase cards to make over 170 personal purchases totaling approximately $16,000 from Amazon.com for items that included toys, exercise equipment, books, clothes and other personal times. Almost all of these items were shipped to Cover’s residence in Arden. In addition, Cover admitted using her NIH/NCI purchase cards to pay off over $29,000 in balances she accrued with various cash advance and payday loan vendors.
According to plea documents, Cover also used and caused to be used her NIH/NCI purchase cards to make more than $47,000 in payments to personal accounts she caused to be created on PayPal, an online payment website. Cover directed over $46,000 from these PayPal accounts to be deposited into bank accounts that she controlled. Plea documents also revealed that in an effort to conceal her misuse of assigned purchase cards, Cover created additional PayPal accounts associated with email accounts that she controlled and which she selected to resemble the name of a legitimate NIH/NCI vendor. In this manner, Cover made over $11,000 in additional hidden payments to these PayPal accounts.
According to court documents, Cover also engaged in additional fraudulent personal transactions totaling approximately $11,000.
In addition, Cover admitted that she further sought to conceal her actions by submitting various dispute forms to the bank servicing her purchase cards, claiming that she did not recognize certain charges or did not authorize them, when, in fact, she knowingly made or caused to be made the personal charges. During her plea hearing, Cover admitted that in or about January and June 2011, she lied to investigators, claiming that she had satisfied personal transactions made with her NIH/NCI purchase cards using her personal bank account, which in fact she knew she had not. Previously, when confronted by her supervisor at NIH/NCI regarding suspicious transactions, Cover claimed falsely that she had been the victim of identity theft, when in fact she knew that she had caused the transactions.
This case is being prosecuted by Trial Attorney Eric G. Olshan of the Criminal Division’s Public Integrity Section. This case was investigated by the HHS Office of Inspector General.Alabama Woman Sentenced to Prison for Using Stolen Identities to Obtain Tax RefundsRead the Press Release
Jacqueline Slaton was sentenced to 70 months in prison and order to pay restitution of over $100,000 for her involvement in stolen identity refund fraud scheme, the Justice Department and the Internal Revenue Service (IRS) announced today.
According to court documents, in 2012, Slaton was in the midst of filing false tax returns using stolen identities when IRS special agents executed a search warrant and ended her operation. At the time, Slaton had access to hundreds of stolen identities.
According to the plea agreement, between December 2011 and March 2012, Slaton filed at least 102 fraudulent federal income tax returns using stolen identities. She also filed 102 fraudulent Alabama state tax returns. The total federal and state tax refunds requested was $154,904. Slaton had the tax refunds directed to prepaid debit cards and had the cards mailed to various addresses on a U.S. carrier’s route. A postal employee agreed to collect the prepaid debit cards for a fee.
“The Justice Department remains committed to investigating and prosecuting tax fraud perpetrated by identity thieves,” said Assistant Attorney General for the Justice Department’s Tax Division Kathryn Keneally. “The lengthy prison sentences handed down by this court, in this and other cases, show that criminals will pay a high price for committing stolen identity refund fraud.”
“Be assured that IRS has made an unwavering commitment to the pursuit of identity theft,” stated Richard Weber, Chief, IRS Criminal Investigation. “Identity theft is not a victimless crime. Identity theft is a contemptible crime that victimizes honest taxpayers and causes immense hardship. IRS Criminal Investigation works in concert with our partners at the U.S. Attorney’s Office and together we will hold those who engage in similar conduct accountable.”
Assistant Attorney General Keneally and George L. Beck Jr., U.S. Attorney for the Middle District of Alabama, commended the efforts of special agents of IRS - Criminal Investigation, who investigated the case, and Tax Division Trial Attorneys Jason H. Poole and Michael Boteler and Assistant U.S. Attorney Todd Brown, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
Monday 22 October 2012
Former Wilcox County, Georgia, Sheriff Pleads Guilty to Assaulting InmateRead the Press Release
The Justice Department and U.S. Attorney for the Middle District of Georgia Michael J. Moore announced today that Stacy Bloodsworth, the former sheriff of Wilcox County, Ga., pleaded guilty to assaulting an inmate inside the Wilcox County jail and subsequently conspiring to cover up the assault. Bloodsworth’s son, Austin Bloodsworth, also pleaded guilty to conspiring to cover up the same assault. Three other defendants had previously pleaded guilty to civil rights and obstruction of justice crimes in connection with the July 23, 2009, assault.
During his plea hearing, Stacy Bloodsworth admitted that on July 23, 2009, while he was acting as sheriff, he was inside the Wilcox County Jail with several other individuals, including his son, Austin Bloodsworth; a Wilcox County inmate-trustee, Willie James Caruthers; a South Central Georgia Drug Task Force agent, Timothy King, Jr.; and a Wilcox County Jailer, Casey Owens. Stacy Bloodsworth ordered three inmates out of their cells because he was angry about reports that one of the inmates had a cell phone, which is in violation of jail regulations. Bloodsworth hit all three inmates, and also watched as other people, including the sheriff’s son, struck and kicked one of the inmates in the face. After it appeared that that inmate’s jaw was broken, the sheriff used a wrench in an attempt to put his broken jaw back into place.
Approximately one week later, the inmate was brought to a local hospital, where his jaw had to be wired shut. The other two inmates assaulted on the same day suffered lacerations, bruising, and pain.
During the plea hearing, Stacy Bloodsworth further admitted that he and the others conspired to cover up the July 23, 2009, assault. The following day, Bloodsworth concocted a false cover story about the assaults in order to cover up the involvement of the law enforcement officials. Specifically, the sheriff instructed Caruthers, Austin Bloodsworth, King and Owens that, if they were ever questioned about the incident, they should say that inmate Caruthers and the victim got into a physical altercation after the inmate used a racial slur against Caruthers. Stacy Bloodsworth, knowing that this statement was false, instructed Caruthers and Owens to write this false cover story in a report. In addition, in August 2010, after learning that the inmate whose jaw had been broken had hired an attorney and had begun to initiate a lawsuit, Sheriff Bloodsworth met with King and Owens and again instructed them that to relay the false story about the cause of the inmate’s broken jaw. In April 2011, Stacy Bloodsworth, who was then still the sheriff of Wilcox County, relayed the false cover story regarding the cause of the inmate’s broken jaw to special agents of the FBI.
Austin Bloodsworth also pleaded guilty today to conspiring to cover up the July 23, 2009, assault. During his plea hearing, Austin Bloodsworth admitted that he kicked the inmate in the face multiple times. In addition, he admitted that he relayed the sheriff’s false cover story about the assault to special agents of the FBI who questioned him in April 2011.
“The Department of Justice will continue to vigorously prosecute officers who cross the line and engage in criminal misconduct,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division.
“We expect our law enforcement officials to uphold the law – and to protect those they serve,” said Michael J. Moore, U.S. Attorney for the Middle District of Georgia. “Today’s guilty pleas by former Sheriff Bloodsworth and Austin Bloodsworth remind us that no one, not even an elected sheriff, is above the law.”
When Stacy Bloodsworth is sentenced, he faces a maximum of ten years on the civil rights charge, and a maximum of five years on the conspiracy charge. Austin Bloodsworth faces a maximum of five years on the conspiracy charge.
This case was investigated by the FBI and is being prosecuted by Trial Attorney Christine M. Siscaretti and Special Litigation Counsel Gerard V. Hogan of the Justice Department’s Civil Rights Division, with the assistance of the U.S. Attorney’s Office for the Middle District of Georgia.
Former New Mexico Corrections Officer Sentenced for Sexually Assaulting InmateRead the Press Release
Sylvester Bruce, 45, a former corrections officer with Navajo Nation’s Shiprock Detention Center (SDC) in Shiprock, N.M., was sentenced today in federal court on charges related to the sexual abuse of an inmate during the summer and fall of 2010. In July 2012, Bruce pleaded guilty to one count of violating the victim’s civil rights when he touched her breasts against her will. Bruce also pleaded guilty to making material false statements to the FBI when he denied taking pictures of inmates inside the cells of the SDC.
According to court documents, while the victim was incarcerated at SDC , Bruce repeatedly placed his hands under her shirt and bra, and grabbed her breasts, knowing that she did not consent to his actions. Bruce did so in areas of the jail that did not have surveillance cameras. Bruce further admitted that he lied to the FBI when he denied taking pictures of inmates in their cells, acknowledging that he had, in fact, photographed two female inmates asleep on a bed in their cell.
Bruce was sentenced to one year and one day in federal prison followed by three years of supervised release. In addition, Bruce will never serve in law enforcement again and will submit to federal and state sex offender registration requirements.
“Every person in official custody has the right to bodily integrity, and namely to be free from sexual assaults by corrections officers,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Justice Department will continue to vigorously prosecute these serious crimes.”
“Every person in lock-up, regardless of the charge or crime of conviction, is entitled to be safe and certainly should never be victimized by the law enforcement officers responsible for guarding them,” said Kenneth J. Gonzales, U.S. Attorney for the District of New Mexico. “I commend the victim in this case for having the courage to step forward and assert her right to be free of sexual abuse, and for trusting the Department of Justice to protect her.”
This case was investigated by the Farmington Resident Agency of the Albuquerque Division of the FBI and was prosecuted by Assistant U.S. Attorney Mark Baker for the District of New Mexico and Fara Gold of the Civil Rights Division of the U.S. Department of Justice.
Former Georgia Police Chief Sentenced for Assaulting Restrained InmateRead the Press Release
Former chief of the Omega, Ga., Police Department, Walter Young, 54, was sentenced today for physically abusing a man in his custody, the Justice Department announced.
U.S. District Judge Hugh Lawson sentenced Young to 24 months in prison for violating the civil rights of a pretrial detainee while acting in his capacity as the chief of police.
According to evidence presented at trial, on March 24, 2011, the former police chief assaulted the detainee, Alfonso Moreno, by repeatedly slapping and punching him in the head and face while he was fully restrained in a restraint chair. Young struck Mr. Moreno a total of eight times, breaking Moreno’s nose. Young’s excessive use of force was captured by the jail’s video surveillance system. A federal jury convicted Young on Aug. 1, 2012.
“There was no excuse for this use of force on a restrained individual and excessive force by those sworn to uphold the law will not be tolerated,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Justice Department will continue to vigorously prosecute law enforcement officers who violate the constitutional rights of others.”
“We trust our law enforcement officers to protect and serve the people of their community,” said Michael J. Moore, U.S. Attorney for the Middle District of Georgia. When we discover violations of that trust, the U.S. Attorney’s Office will use all of our resources to see that those officers who broke the law are made to account for their actions.”
This case was investigated by the FBI and prosecuted by Special Litigation Counsel Forrest Christian and Trial Attorney Tona Boyd of the Civil Rights Division of the U.S. Department of Justice, with the assistance of the U.S. Attorney’s Office for the Middle District of Georgia and the support of the Georgia Bureau of Investigations.
Friday 19 October 2012
United States Sues Jacintoport International for False Claims<br /> <br /> in Connection with the Delivery of Humanitarian Food AidRead the Press Release
The United States has filed a complaint against Jacintoport International LLC under the False Claims Act in connection with a warehousing and logistics contract for the storage and redelivery of humanitarian food aid, the Justice Department announced today. Jacintoport is a cargo handling and stevedoring firm headquartered in Houston.
As alleged in the government’s complaint, Jacintoport entered into a warehousing and logistics contract with the U.S. Agency for International Development (USAID) for the storage and redelivery of emergency humanitarian food aid in 2007. This contract, among other things, contained explicit caps on the rates Jacintoport could charge to load humanitarian food aid onto ships (referred to in the industry as “stevedoring” charges) bound for crisis areas around the world. The complaint alleges that beginning around January 2008 and continuing through at least October 2009, Jacintoport regularly exceeded these caps, resulting in inflated charges to the United States in connection with the delivery of more than 50 thousand tons of humanitarian food aid.
“USAID’s humanitarian food aid program provides critical assistance to starving people all over the world,” said Stuart F. Delery, Assistant Attorney General for the Civil Division of the Department of Justice. “The Justice Department will take action against those whom we believe improperly charged the taxpayers in providing vital humanitarian aid.”
“This action is part of our commitment to protecting the taxpayers’ money and ensuring the integrity of foreign assistance programs,” said U.S. Attorney Ronald C. Machen Jr. “When contractors do not meet their obligations, they will be held accountable.”
“It is our number one priority to ensure that taxpayer dollars are wisely and properly used,” stated the USAID Deputy Inspector General Michael Carroll. “This case is another example of the excellent work of the USAID Office of Inspector General and the Department of Justice. We will continue to investigate and pursue this type of misconduct wherever and whenever it occurs.”
The United States’ complaint was filed in a lawsuit initiated under the qui tam or whisteblower provisions of the False Claims Act by John Raggio, who allegedly received an invoice from Jacintoport that contained the excessive stevedoring charge. The act imposes treble damages and penalties for the submission of false claims for government money and/or property. Under the Act’s qui tam provisions, a private citizen, known as a “relator,” can sue on behalf of the United States and share in any recovery. The United States is permitted to intervene in the lawsuit, as it has done here.
The Justice Department’s Civil Division and the U.S. Attorney’s Office for the District of Columbia, with assistance from the USAID Office of the Inspector General, handled the investigation of this matter. The claims alleged in the United States’ complaint are only allegations and do not constitute a determination of liability.
The case is United States ex. rel. Raggio v. Jacintoport International LLC Case No. 1:10-cv-01908 (D.D.C.).
Justice Department to Monitor Early Voting in TexasRead the Press Release
The Justice Department announced today that it will monitor portions of the early voting period for the Nov. 6, 2012, general election in Dallas and Harris Counties, Texas, to ensure compliance with the Voting Rights Act of 1965. The Voting Rights Act prohibits discrimination in the election process on the basis of race, color or membership in a minority language group. Early voting in Dallas and Harris Counties begins on Monday, October 22.
Justice Department personnel will monitor polling place activities during early voting in these two counties. Civil Rights Division attorneys will coordinate federal activities and maintain contact with local election officials.
Each year, the Justice Department deploys hundreds of federal observers from the Office of Personnel Management, as well as departmental staff, to monitor elections across the country. To file complaints about discriminatory voting practices, including acts of harassment or intimidation, voters may call the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.
Visit www.justice.gov/crt/voting/index.php for more information about the Voting Rights Act and other federal voting laws.
Justice Department and EPA to Hold Community Meetings in Corpus Christi, Texas, to Assist Residents Who May Be Victims of Environmental Crimes by CITGO RefineryRead the Press Release
The Department of Justice and the U.S. Environmental Protection Agency (EPA) will hold three community meetings in Corpus Christi, Texas next week to assist area residents who have suffered immediate negative health effects from emissions from the CITGO refinery.
The community meetings will be held at the Oveal Williams Senior Living Center at 1414 Martin Luther King Drive in Corpus Christi on the following dates:
- Thursday, October 25, from 12:00 p.m. until 8:00 pm
- Friday, October 26, from 9:00 am until 7:30 pm
- Saturday October 27, from 9:00 am until 6:00 pm
On Sept. 14, 2012, U.S. District Judge John D. Rainey issued an order directing the government to announce that any member of the community at large who believes they may be a crime victim and wishes to participate in the proceeding is made aware of their potential rights. Persons living around the CITGO refinery’s tanks 116 and 117 that were operated between January 1994 and May 2003 in violation of the federal Clean Air Act, may be crime victims in United States v. CITGO Petroleum Corporation et al.
The government is asking that members of the community who believe they may be victims under the order and who have not previously submitted a victim impact statement either attend the community meetings from Oct. 25-27, 2012, or request and submit a victim impact statement by email at [email protected] . Community members should email or drop off their victim impact statements during the community meetings or at the U.S. Attorney’s Office at 800 N. Shoreline Blvd., Ste. 500 in Corpus Christi on or before Nov. 1, 2012.
Under the Crime Victim’s Rights Act, persons who are directly and proximately harmed by the commission of a crime are crime victims and have certain, enumerated rights under the law. In this instance, community members may be considered crime victims based on the immediate negative health effects they suffered from breathing noxious fumes from Tanks 116 and 117 during the 1994 – 2003 time frame. Persons who will be seeking restitution for financial losses or health costs should bring or submit supporting documentation.
At the community meeting, the Texas Environmental Crimes Task Force, made up of agents from the U.S. EPA, Texas Commission on Environmental Quality, U.S. Fish and Wildlife Service, Texas Parks and Wildlife, and the FBI, along with the Victim/Witness Section of the U.S. Attorney’s Office for the Southern District of Texas, will be on hand to provide Victim Impact Statements and answer questions.
In June 2007, a jury convicted CITGO Petroleum Corporation and CITGO Refining and Chemicals Company L.P. for illegally operating two massive tanks at their Corpus Christi East Plant Refinery between January 1994 and March 2002. The tanks were the source of emissions including benzene, a known carcinogen, which may have affected persons in the surrounding communities of Hillcrest and Oak Park. Witnesses at the trial testified that emissions from the tanks could be detected in Oak Park and Hillcrest in the form of strong gaseous type odors.
On Sept. 25 and 26, 2007, the U.S. Department of Justice and the U.S. Environmental Protection Agency held community meetings in Corpus Christi during which more than 300 persons submitted victim impact statements. The current order is to identify any additional persons who may qualify as crime victims.
Justice Department Files Complaint Against Warren County, North Carolina, Board of Education for Violating the Employment Rights of an Army Reserve SergeantRead the Press Release
The Justice Department and U.S. Attorney Thomas G. Walker announced today the filing of a complaint in U.S. District Court for the Eastern District of North Carolina against the Warren County, N.C., Board of Education for violating the employment rights of Army Reserve Sergeant Dwayne Coffer under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA).
The department’s complaint alleges that the Warren County Board of Education willfully violated USERRA by not renewing Coffer’s employment because of his military service obligations. Coffer is a Sergeant First Class in the U.S. Army Reserve. He has served in the Army Reserve for over 20 years. In addition to other periods of service, he served in Kuwait and Afghanistan from February 2004 to February 2005. Coffer worked at Warren County High School as an Assistant Principal while he was in the Army Reserve. During his employment with the Warren County Board of Education, Coffer took periodic leave from work to fulfill his military obligations with the Army Reserve. According to the Justice Department’s complaint, on April 25, 2008, the board voted not to renew Coffer’s contract as an assistant principal after staff members expressed frustration at his performing military service during the school year.
Coffer initially filed a complaint with the Labor Department’s Veterans’ Employment and Training Service, which investigated the matter, determined that the complaint had merit, and referred the matter to the Justice Department. The Justice Department’s Civil Rights Division and the U.S. Attorney’s Office for the Eastern District of North Carolina subsequently decided to represent Coffer in this matter and filed this lawsuit on his behalf.
USERRA prohibits employers from discriminating against Army Reserve soldiers, such as Coffer, with respect to employment opportunities based on their past, current or future uniformed service obligations. Under USERRA, it is unlawful for an employer to terminate an employee because he has to miss work due to military obligations.
Among other things, the suit seeks compensation for Coffer’s lost wages and benefits, liquidated damages and reinstatement of Coffer’s employment with the Board of Education.
“Our dedicated military men and women should not have to choose between serving their county as reservists and keeping their civilian jobs,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Civil Rights Division is committed to USERRA enforcement and will take all appropriate and necessary action to vigorously protect reservists from unlawful discrimination in the workplace.”
“In serving our country, members of the Army Reserve sacrifice time away from their families and from their jobs. They are willing to risk their lives to protect the freedoms we hold dear,” said U.S. Attorney Walker. “We will use all of USERRA’s tools to protect the employment rights of those in uniform.”
This case is being handled by the Employment Litigation Section of the Justice Department’s Civil Rights Division and the U.S. Attorney’s Office for the Eastern District of North Carolina.
Additional information about USERRA can be found on the Justice Department websites www.usdoj.gov/crt/emp and www.servicemembers.gov , as well as the Labor Department website www.dol.gov/vets/programs/userra/main.htm .
Justice Department Announces Agreement to Protect Rights of Military and Overseas Voters in VermontRead the Press Release
The Justice Department announced today that it has reached an agreement with the State of Vermont to help ensure that military service members, their family members and U.S. citizens living overseas have the opportunity to participate fully in the Nov. 6, 2012, federal general election.
The agreement was filed today in the federal district court in Vermont to resolve the lawsuit the department brought on Oct. 11, 2012, to enforce the Uniformed and Overseas Citizens Absentee Voting Act (UOCAVA). If approved by the court, the agreement will provide additional time for receipt of absentee ballots to ensure eligible military and overseas voters, who requested ballots, will have sufficient time to vote in the general election. The agreement also provides individual notice to each affected voter, and Vermont will provide a report to the United States about Vermont’s compliance with UOCAVA.
“This agreement reflects this department’s steadfast and continued commitment to ensure that members of our armed forces, their families and overseas citizens are offered a full and meaningful opportunity to vote in our nation’s elections,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “I am most appreciative that election officials in Vermont worked cooperatively with the department and agreed to take actions to ensure that military and overseas voters will have a full opportunity to have their votes counted in the upcoming general election.”
“The right to vote is the cornerstone of our democracy,” said U.S. Attorney for the District of Vermont Tristram J. Coffin. “I am happy that we could resolve this issue in a manner that enables members of our armed services, and other citizens abroad, to exercise this fundamental right.”
More information about UOCAVA and other federal voting laws is available on the Department of Justice website at www.justice.gov/crt/about/vot/misc/activ_uoc.php . Please report any complaints to the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.
Former Officers of American Mortgage Specialists Inc. Plead Guilty in North Dakota to Conspiracy in $27 Million Fraud Against Bnc National BankRead the Press Release
WASHINGTON – Two former officers of Arizona-based residential mortgage loan originator American Mortgage Specialists Inc. (AMS) pleaded guilty today for their roles in a $27 million scheme to defraud North Dakota-based BNC National Bank, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Timothy Q. Purdon of the District of North Dakota; Christy Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP); and Steve A. Linick, Inspector General of the Federal Housing Finance Agency Office of Inspector General (FHFA-OIG).
Scott N. Powers, the CEO of AMS, and David E. McMaster, an AMS vice president, pleaded guilty today before U.S. District Judge Daniel L. Hovland in the District of North Dakota to one count of conspiracy to commit bank fraud and wire fraud affecting a financial institution.Powers and McMaster were charged in a criminal information unsealed on Oct. 2, 2012, in the District of North Dakota. Lauretta Horton, the former director of accounting at AMS, and David Kaufman, an outside auditor, were also charged in separate informations unsealed on Oct. 2, 2012, for their roles in this scheme. Both Horton and Kaufman are scheduled to appear this afternoon before Magistrate Judge Charles S. Miller Jr. for arraignment.
“At the height of the financial crisis, Scott Powers, David McMaster and their alleged co-conspirators enacted a scheme to systematically defraud BNC Bank,” said Assistant Attorney General Breuer. “When their mortgage lending company became unsustainable, they turned to fraud. By deliberately misleading BNC about its assets and activities, Powers and McMaster threatened the viability of BNC and put its employees and customers at risk. Today’s guilty pleas demonstrate our commitment to holding individuals accountable for illegal conduct contributing to the housing crisis.”“This prosecution is proof that illegal conduct related to the mortgage crisis impacted banks all across the country and even here in North Dakota,” said U.S. Attorney Purdon. “Through close collaboration with our federal investigative partners and the Justice Department’s Criminal Division, we were able to secure today’s guilty pleas and begin to correct this wrongdoing.”
“Powers, McMaster and their alleged co-conspirator took advantage of BNC National Bank receiving $20 million in TARP funds to defraud BNC out of more than $27 million in a scheme engineered to cover their losses from the downturn in the housing market,” said Special Inspector General Romero. “They used BNC as their personal piggy bank, and the bank was unable to pay millions of dollars in TARP dividend payments owed to American taxpayers. Fraud against TARP banks equals fraud against taxpayers, and SIGTARP and our law enforcement partners will hold perpetrators of TARP fraud accountable for their crimes.”
“Such fraudulent activity at any time is unacceptable, but it’s particularly egregious when conducted by those who are supposed to ensure the integrity of the mortgage industry,” said Inspector General Linick. “My office is committed to holding accountable those who engage in fraudulent activities, and we are proud to have worked on this case with our law enforcement partners.”
According to court documents, Powers and McMaster conspired from October 2007 to April 2010 to defraud BNC by making false representations regarding the financial and operational well being of AMS in order to obtain funding from BNC and personal benefits for themselves. AMS was in the business of originating residential real estate mortgage loans to borrowers and then selling the loans to institutional investors.
In 2006, AMS entered into a loan participation agreement with BNC whereby BNC provided funding for the loans issued by AMS. Powers and McMaster pleaded guilty to causing AMS to delay sending “pay down” emails, which would notify BNC when specific loans were sold. By delaying the sending of pay down emails, Powers and McMaster were able to use funds from newly-sold loans to make payments for earlier-sold loans and inflate the dollar amount in the pay down emails for the earlier-sold loans.
According to their plea documents, Powers and McMaster also caused false financial information about AMS to be sent to BNC, overstating AMS’s cash-on-hand and disguising delinquent tax payments being made to the Internal Revenue Service as marketing and advertising expenses. As part of their plea agreements, Powers and McMaster have agreed to forfeit $28,564,470, which includes proceeds from the fraud.
Horton was charged in a one count information for conspiring to provide fraudulent financial information to BNC. According to court documents, Horton inflated asset items and altered other financial information in the AMS balance sheet provided to BNC to falsely reflect that AMS had substantial liquid assets when, in fact, it did not. Horton also allegedly concealed payments that AMS was making to the IRS for a delinquency in unpaid payroll taxes by disguising them as marketing and advertising expenses.
Kaufman, a certified public accountant who audited the annual financial statements of AMS, was charged in a one count information for allegedly obstructing the grand jury investigation into the AMS fraud. According to court documents, Kaufman lied to federal agents during the criminal investigation and obstructed the grand jury investigation when he denied that he had a conversation with an AMS executive in which Kaufman explained to the AMS executive that he had combined two expenses in the financial statements in order to conceal the true nature and extent of AMS’s financial condition from BNC.
Although BNC’s holding company had received approximately $20 million under the TARP and had injected approximately $17 million of the TARP funds into BNC, BNC incurred losses exceeding the millions received from TARP. BNC then did not make its required TARP dividends to the Department of Treasury for nearly two years.
At sentencing, scheduled for April 15, 2013, Powers and McMaster face a maximum penalty of 30 years in prison.The investigation was conducted by agents assigned to the Offices of the Inspector General of SIGTARP and of FHFA. The case is being prosecuted by Assistant U.S. Attorney Clare Hochhalter of the District of North Dakota and by Trial Attorney Robert A. Zink and Senior Litigation Counsel Jack B. Patrick of the Criminal Division’s Fraud Section with the assistance of Trial Attorney Jeannette Gunderson of the Criminal Division’s Asset Forfeiture and Money Laundering Section.
This case is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
The charges and allegations contained in the informations are merely accusations and the defendants are presumed innocent unless and until proven guilty.
Thursday 18 October 2012
Top Executives at Kolon Industries Indicted<br /> for Stealing DuPont’s Kevlar Trade SecretsRead the Press Release
Kolon Industries Inc. and several of its executives and employees have been indicted for allegedly engaging in a multi-year campaign to steal trade secrets related to DuPont’s Kevlar para-aramid fiber and Teijin Limited’s Twaron para-aramid fiber . The indictment seeks forfeiture of at least $225 million in proceeds from the alleged theft of trade secrets from Kolon’s competitors.
The charges were announced today by U.S. Attorney for the Eastern District of Virginia Neil H. MacBride; Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; and Jeffrey C. Mazanec, Special Agent in Charge of the FBI’s Richmond Field Office
“Kolon is accused of engaging in a massive industrial espionage campaign that allowed it to bring Heracron quickly to the market and compete directly with Kevlar,” said U.S. Attorney MacBride. “This country’s greatest asset is the innovation and the ingenuity and creativity of the American people. The genius of free enterprise is that companies compete on the excellence of their ideas, products and services – not on theft. This indictment should send a strong message to companies located in the United States and around the world that industrial espionage is not a business strategy.”
“By allegedly conspiring to steal DuPont’s and Teijin’s intellectual property, Kolon threatened to undermine an economic engine at both companies,” said Assistant Attorney General Breuer. “Developing Kevlar and Twaron was resource-intensive work, and required strategic investment and ingenuity. Kolon, through its executives and employees, allegedly acted brazenly to profit off the backs of others. The Justice Department has made fighting intellectual property crime a top priority, and we will continue to aggressively prosecute IP crimes all over the country.”
“It’s critical that law enforcement aggressively investigate crimes of intellectual property theft, such as this one,” said FBI Special Agent in Charge Mazanec. “If not, intellectual creativity and our economy will be compromised. As a member of the Department of Justice Task Force on Intellectual Property, our office will investigate any company, domestic or international, that steals confidential proprietary information for their own benefit. We will pursue those that prey on the originality and vision of hardworking businesses who conduct their own research, obtain patents and market a successful product.”
Headquartered in Seoul, South Korea, Kolon was indicted by a grand jury in Richmond, Va. The indictment charges Kolon with one count of conspiring to convert trade secrets, four counts of theft of trade secrets and one count of obstruction of justice.
Kolon makes a product called Heracron, which is a recent entrant into the para-aramid fiber market as a competitor to products called Kevlar and Twaron. Para-aramid fibers are used to make, for example, body armor, fiberoptic cables and automotive and industrial products. Kevlar is produced by E. I. du Pont de Nemours and Company (DuPont), one of the largest chemical companies in the United States. For decades, Kevlar has competed against Twaron, a para-aramid fiber product produced by Teijin Limited, one of the largest chemical companies in Japan.
According to the indictment, from July 2002 through February 2009, Kolon allegedly sought to improve its Heracron product by targeting current and former employees at DuPont and Teijin and hiring them to serve as consultants, then asking these consultants to reveal information that was confidential and proprietary.
The indictment alleges that in July 2002, Kolon obtained confidential information related to an aspect of DuPont’s manufacturing process for Kevlar, and within three years Kolon had replicated it. This successful misappropriation of DuPont’s confidential information, the indictment alleges, spurred Kolon leadership to develop a multi-phase plan in November 2005 to secure additional trade secret information from its competitors, by targeting people with knowledge of both pre-1990 para-aramid technology and post-1990 technologies.
Kolon is alleged to have retained at least five former DuPont employees as consultants. Kolon allegedly met with these people individually on multiple occasions from 2006 through 2008 to solicit and obtain sensitive, proprietary information that included details about DuPont’s manufacturing processes for Kevlar, experiment results, blueprints and designs, prices paid to suppliers and new fiber technology. In cases where the consultants could not answer Kolon’s specific and detailed questions, Kolon allegedly requested the consultants to obtain the information from current employees at DuPont.
The indictment alleges that during a meeting with one consultant, a Kolon employee surreptitiously copied information from a CD the former DuPont employee had brought with him that contained numerous confidential DuPont business documents, including a detailed breakdown of DuPont’s capabilities and costs for the full line of its Kevlar products, customer pricing information, analyses of market trends and strategies for specific Kevlar submarkets. This wealth of information was allegedly copied and dispersed among several Kolon executives and employees, and the indictment alleges that many of these documents and others associated with the consultants were deleted by the Kolon executives and employees after DuPont filed a civil suit against Kolon in 2009.
Kolon also is accused of attempting to recruit a former employee of a Teijin subsidiary, Teijin Twaron, who reported the requests for trade secret information to Teijin Twaron. Legal representatives from Teijin Twaron sent a letter to Kolon in January 2008 demanding that Kolon cease and desist from seeking to obtain trade secrets related to Twaron. After this incident, the indictment alleges that Kolon continued to try to obtain trade secrets, but took additional steps to attempt to avoid detection of its actions.
The indictment alleges that, in August 2008, Kolon employees met with a current DuPont employee in a hotel room in Richmond and discussed how the DuPont employee could provide trade secrets to Kolon without leaving evidence.
In addition to the corporation itself, the following Kolon executives and employees from Seoul were charged with conspiring together to steal trade secrets and obstruction of justice for deleting information from their computers:
· Jong-Hyun Choi, 56, was a senior executive overseeing the Heracron Business Team. He allegedly met with other top executives at Kolon to develop the directives to secure consultants and directly participated in carrying out the directives.
· In-Sik Han, 50, managed Kolon’s research and development related to Heracron and was allegedly responsible for overseeing the “consulting” sessions with ex-DuPont employees.
· Kyeong-Hwan Rho, 47, worked for Kolon for more than 25 years and served as the head of the Heracron Technical Team beginning in January 2008. He allegedly participated in the consulting sessions.
· Young-Soo Seo, 48, reported to Choi and served as the general manager for the Heracron Business Team beginning in November 2006. He allegedly participated in the consulting sessions.
· Ju-Wan Kim, 40 , was a manager on the Heracron Business Team from September 2007 through February 2009 and reported to Seo. He was the main point of contact at Kolon for at least one of the ex-DuPont employees. He also participated in the consulting sessions.
The conspiracy and theft of trade secrets counts each carry a maximum penalty of 10 years in prison and a fine of $250,000 or twice the gross gain or loss for individual defendants, and a fine of $5 million or twice the gross gain or loss for the corporate defendant. The obstruction of justice count carries a maximum penalty of 20 years in prison and a fine of $250,000 or twice the gross gain or loss for individual defendants, and a fine of $500,000 or twice the gross gain or loss for the corporate defendant.
The indictment seeks at least $225 million in forfeiture, which represents the approximate gross proceeds of the sale of Heracron from January 2006 through June 2012, along with $341,000 in payments made to former DuPont employees in exchange for trade secret information.
The case is being prosecuted by Assistant U.S. Attorneys Timothy D. Belevetz and Kosta S. Stojilkovic of the U.S. Attorney’s Office for the Eastern District of Virginia’s Financial Crimes and Public Corruption Unit and Trial Attorney John W. Borchert of the Criminal Division’s Fraud Section and Senior Counsel Rudolfo Orjales of the Criminal Division’s Computer Crime and Intellectual Property Section. This case is being investigated by the FBI’s Richmond Field Office.
This case is part of efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force) to stop the theft of intellectual property. Attorney General Eric Holder created the IP Task Force to combat the growing number of domestic and international intellectual property crimes, protect the health and safety of American consumers, and safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation and hard work. The IP Task Force seeks to strengthen intellectual property rights protection through heightened criminal and civil enforcement, greater coordination among federal, state and local law enforcement partners, and increased focus on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders. To learn more about the IP Task Force, go to www.justice.gov/dag/iptaskforce .
Three Former Financial Services Executives Sentenced to Serve Time in Prison for Roles in Conspiracies Involving Investment Contracts for the Proceeds of Municipal BondsRead the Press Release
Three former financial services executives were sentenced today in U.S. District Court for the Southern District of New York, for their participation in conspiracies related to bidding for contracts for the investment of municipal bond proceeds and other municipal finance contracts, the Department of Justice announced. The three former executives were convicted after a three week trial on May 11, 2012.
Dominick P. Carollo, Steven E. Goldberg and Peter S. Grimm, all former executives of General Electric Co. (GE) affiliates, were sentenced by District Court Judge Harold Baer Jr. for their roles in the conspiracies. Carollo was sentenced to serve 36 months in prison and to pay a $50,000 criminal fine. Goldberg was sentenced to serve 48 months in prison and to pay a $90,000 criminal fine. Grimm was sentenced to serve 36 months in prison and to pay a $50,000 criminal fine.
“By manipulating the competitive bidding process, the conspirators cheated cities and towns out of money for important public works projects,” said Scott D. Hammond, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program. “The division and its law enforcement partners remain committed to rooting out such corruption.”
According to evidence presented at trial, while employed at GE affiliates, Carollo, Goldberg and Grimm participated in separate fraud conspiracies with various financial institutions and insurance companies and their representatives from as early as 1999 until 2006. These institutions and companies, or “providers,” offered a type of contract, known as an investment agreement, to state, county and local governments and agencies throughout the United States. The public entities were seeking to invest money from a variety of sources, primarily the proceeds of municipal bonds that they had issued to raise money for, among other things, public projects. Goldberg also participated in the conspiracies while employed at Financial Security Assurance Capital Management Services LLC.
At trial, the Department of Justice asserted that Carollo, Goldberg, Grimm and their co-conspirators corrupted the bidding process for dozens of investment agreements to increase the number and profitability of investment agreements awarded to the provider companies where they were employed. Carollo, Goldberg and Grimm deprived the municipalities of competitive interest rates for the investment of tax-exempt bond proceeds that were to be used by municipalities for various public works projects, such as for building or repairing schools, hospitals and roads. Evidence at trial established that they cost municipalities around the country millions of dollars.
“Today’s sentencing of Carollo, Goldberg and Grimm for their involvement manipulating a competitive bidding process of public contracts is the final step in a case that demonstrates the FBI’s commitment to investigate and prosecute those who illegally influence the financial markets for their own profit,” said Mary E. Galligan, Acting Assistant Special Agent Charge of the FBI in New York. “The co-conspirators scheme over many years deprived municipalities across the country of competitive interest rates on bonds, a yield that most cities would say they greatly need. The FBI will continue to work with our law enforcement partners to enforce the laws that protect our financial markets.”
"The sentences handed down today send a clear message that crime motivated by outright greed will land you in jail,” said Richard Weber, Chief, Internal Revenue Service – Criminal Investigation (IRS-CI). “Quite simply, the defendants stole money from taxpayers and conspired to manipulate the competitive bidding system to benefit themselves instead of the towns and cities that needed this money for important public works projects. IRS Criminal Investigation is committed to working with our law enforcement partners to uncover this kind of corruption and secure justice for American taxpayers.”
Carollo was found guilty on two counts of conspiracy to commit wire fraud and defraud the United States, Goldberg was found guilty on four counts of conspiracy to commit wire fraud and defraud the United States and Grimm was found guilty on three counts of conspiracy to commit wire fraud and defraud the United States.
A total of 20 individuals have been charged as a result of the department’s ongoing municipal bonds investigation. Including today’s convictions, a total of 19 individuals have been convicted or pleaded guilty, and one awaits trial. Additionally, one company has pleaded guilty.
The sentences announced today resulted from an ongoing investigation conducted by the Antitrust Division’s New York Office, the FBI and the IRS-CI. The division is coordinating its investigation with the U.S. Securities and Exchange Commission, the Office of the Comptroller of the Currency and the Federal Reserve Bank of New York.
Today’s convictions are part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
Anyone with information concerning bid rigging and related offenses in any financial markets should contact the Antitrust Division’s New York Field Office at 212-335-8000, the FBI at 212-384-5000 or IRS-CI at 212-436-1761, or visit www.justice.gov/atr/contact/newcase.htm.Owner and Operator of Florida Halfway House Company Sentenced to 51 Months in Prison for Role in Medicare Fraud SchemeRead the Press Release
WASHINGTON – The owner and operator of New Way Recovery Inc., a Florida corporation that operated several halfway houses, was sentenced today to serve 51 months in prison for his role in a $205 million Medicare fraud scheme involving fraudulent claims for purported partial hospitalization program (PHP) services, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Acting Special Agent-in-Charge of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher B. Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.
Hassan Collins, 41, was sentenced by U.S. District Judge Kevin Michael Moore in the Southern District of Florida. In addition to his prison term, Collins was sentenced to serve three years of supervised release and ordered to pay $2,413,675 in restitution, jointly and severally with co-conspirators.
On June 14, 2012, Collins pleaded guilty to one count of conspiracy to receive and pay health care fraud kickbacks.
According to court documents, from approximately April 2004 through approximately September 2010, Collins, along with co-conspirators, received kickback payments in exchange for referring Medicare beneficiaries, who did not qualify for PHP treatment, for purported PHP services to American Therapeutic Corporation (ATC), a Florida corporation that operated several purported PHPs throughout Florida. Collins and his co-conspirators caused false and fraudulent claims to be submitted to Medicare for PHP services purportedly provided to Medicare beneficiaries at ATC’s locations, when, in fact, the services were never provided.
In related cases, ATC, its management company, Medlink Professional Management Group Inc. and various owners, managers, doctors, therapists, patient brokers and marketers of ATC, were charged with various health care fraud, kickback, money laundering and other offenses in two indictments unsealed in February 2011. ATC, Medlink and more than 20 of the individual defendants charged in these cases have pleaded guilty or have been convicted at trial.
The case is being prosecuted by Fraud Section Trial Attorney Allan J. Medina. The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Justice Department Intervenes in Lawsuit Against Law School Admission Council on Behalf of Test Takers with Disabilities NationwideRead the Press Release
A federal judge issued an order today allowing the Justice Department to intervene in a disability discrimination lawsuit against the Law School Admission Council (LSAC). The department’s intervention expands the case from a statewide class action limited to California residents to a nationwide pattern or practice lawsuit.
The lawsuit, The Department of Fair Employment and Housing v. LSAC Inc. et al., charges LSAC with widespread and systemic deficiencies in the way it processes requests by people with disabilities for testing accommodations for the Law School Admission Test (LSAT). As a result, the lawsuit alleges, LSAC fails to provide testing accommodations where needed to best ensure that those test takers can demonstrate their aptitude and achievement level rather than their disability.
The department’s complaint identifies additional victims of LSAC’s discriminatory policies and details LSAC’s routine denial of testing accommodation requests, even in cases where applicants have submitted thorough supporting documentation from qualified professionals and demonstrated a history of testing accommodations since elementary school.
The department further alleges that LSAC discriminates against prospective law students with disabilities by unnecessarily “flagging” test scores obtained with certain testing accommodations in a way that identifies the test taker as a person with a disability, disclosing otherwise confidential disability-related information to law schools during the admissions process. LSAC’s practice of singling out persons with disabilities by flagging their scores –– is discrimination prohibited by the Americans with Disabilities Act (ADA). The department’s proposed complaint seeks declaratory and injunctive relief, compensatory damages and a civil penalty against LSAC.
“LSAC’s discriminatory policies in the administration of the LSAT adversely impact people with disabilities nationwide. This is a systemic problem with serious consequences that echo throughout such individuals’ academic and employment careers, and it needs to be addressed as such,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Justice Department’s full participation in this case is an important step towards ending a long cycle of disability discrimination in standardized testing.”
One of the victims identified in the complaint, for example, was diagnosed with dyslexia at age seven. He was evaluated on four different occasions by qualified professionals, first in 1990 and most recently in 2011, and has received extended time on tests since the results of his first evaluation were reported. Consistent with his long history of testing accommodations, and the recommendations of the qualified professionals who evaluated him, he requested testing accommodations for the June and October 2011 administration of the LSAT, including extended time. In support of his request, he submitted a full neuropsychological evaluation and proof that he received extended time on multiple AP exams, multiple administrations of the SAT, as well as throughout elementary school, high school and college. Despite acknowledging his diagnosis, LSAC denied his request for extended time in full without any explanation. When the applicant requested an explanation of the denial, LSAC disputed the accuracy of his well-documented and consistent diagnosis, as well as his long history of testing accommodations. The applicant requested reconsideration and submitted additional supporting documentation demonstrating his long history of disability and need for the requested extended time, as well as a further letter from the board certified neuropsychologist who evaluated him in 2011 explaining why LSAC’s interpretation of his evaluation was incorrect. Despite this clear and comprehensive documentation of his disability and need for extended time, LSAC again refused to provide the needed accommodation without any further explanation. As a result, the applicant was denied access to the LSAT and prevented from applying to law school.
“The U.S. Attorney’s Office remains committed to ensuring equal access to educational opportunities for everyone,” said U.S. Attorney Melinda Haag, U.S. Attorney for the Northern District of California. “We are pleased that the Court granted the government’s motion to intervene.”
Title III of the ADA prohibits discrimination on the basis of disability by public accommodations and by entities that offer examinations or courses related to applications, licensing, certification, or credentialing for secondary or postsecondary education, professional, or trade purposes. The ADA mandates that testing entities administer examinations in an accessible manner. This requires testing entities to administer examinations, such as the LSAT, so as to best ensure that, when the examination is administered to a person with a disability, the examination results accurately reflect his or her aptitude or achievement level, or whatever other factor the examination purports to measure, rather than the individual’s disability. In addition, Title V of the ADA prohibits any entity from coercing, intimidating, threatening, or interfering with an individual’s exercise or enjoyment of a right granted by the ADA.
Those interested in finding out more about federal disability rights laws may call the Justice Department’s toll-free ADA information Line at 800-514-0301 or 800-514-0383 (TDD), or access its ADA website at www.ada.gov. ADA complaints may be filed by email to [email protected].
Former FBI Agent and Alleged Co-Conspirators Indicted for Scheme to Obstruct Federal Fraud InvestigationRead the Press Release
WASHINGTON – A federal grand jury in Salt Lake City today returned an 11-count indictment charging a former FBI special agent and two alleged accomplices with a scheme to use the agent’s official position to derail a federal investigation into the conduct of one of the alleged conspirators. The charges were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney for the District of Utah David B. Barlow and Department of Justice Inspector General Michael E. Horowitz.
The indictment charges former FBI special agent Robert G. Lustyik Jr., 50, of Sleepy Hollow, N.Y.; Michael L. Taylor, 51, of Harvard, Mass., the principal of Boston-based American International Security Corporation (AISC); and Johannes W. Thaler, 49, of New Fairfield, Conn., each with one count of conspiracy, eight counts of honest services wire fraud, one count of obstructing justice and one count of obstructing an agency proceeding.
“According to the indictment, while active in the FBI, former Special Agent Lustyik used his position in an attempt to stave off the criminal investigation of a business partner with whom he was pursuing lucrative security and energy contracts,” said Assistant Attorney General Breuer. “He allegedly acted through a childhood friend to secure promises of cash, purported medical expenses and business proceeds in exchange for abusing his position as an FBI agent. The alleged conduct is outrageous, and we will do everything we can to ensure that justice is done in this case.”
DOJ Inspector General Horowitz stated: “Law enforcement officers are sworn to uphold the law. Agents who would sell their badges and impede the administration of justice will be vigorously pursued.”
According to the indictment, Robert Lustyik was an FBI special agent until September 2012, assigned to counterintelligence work in White Plains, N.Y. The indictment also states that from at least June 2011, the three alleged conspirators had a business relationship involving the pursuit of contracts for security services, electric power and energy development, among other things, in the Middle East, Africa and elsewhere.
The indictment alleges that in September 2011, Taylor learned of a federal criminal investigation, begun in Utah in 2010, into whether Taylor, his business and others committed fraud in the award and performance of a contract with the U.S. Department of Defense.
Soon thereafter, Taylor allegedly began to give and offer things of value to Lustyik in exchange for Lustyik’s agreement to use his official position to impair and impede the Utah investigation. The indictment also alleges that Thaler, a childhood friend of Lustyik’s, served as a conduit between Taylor and Lustyik, passing information and things of value.
Specifically, the indictment charges that Taylor offered Lustyik a $200,000 cash payment; money purportedly for the medical expenses of Lustyik’s minor child; and a share in the proceeds of several anticipated contracts worth millions of dollars.
According to the indictment, Lustyik used his official FBI position to impede the Utah investigation by, among other things, designating Taylor as an FBI confidential source, texting and calling the Utah investigators and prosecutors to dissuade them from charging Taylor and attempting to interview potential witnesses and targets in the Utah investigation. As alleged in the indictment, Lustyik wrote to Taylor that he was going to interview one of Taylor’s co-defendants and “blow the doors off this thing.” Referring to the Utah investigation, Lustyik also allegedly assured Taylor that he would not stop in his “attempt to sway this your way.”
According to the indictment, Lustyik, Taylor and Thaler attempted to conceal the full extent of Lustyik’s relationship with Taylor from the Utah prosecutors and agents, including by making and planning to make material misrepresentations and omissions to federal law enforcement involved in the investigation of Taylor.
For example, the indictment alleges that on Sept. 8, 2012, after Taylor was searched at the border and his computer seized, Lustyik sent a text message to Thaler, stating: “You might have to save me and testify that only you r doing business.” Nine days later, according to the indictment, Thaler told federal law enforcement agents – in a voluntary, recorded interview – that Lustyik was not involved in Taylor’s and Thaler’s business.
The pair also allegedly used an email “dead drop” to avoid leaving a record of their interactions and used the names of football teams and nicknames as part of their coded communications.
Taylor and Lustyik were both previously arrested on prior criminal complaints in this case. Taylor has been detained pending trial and Lustyik received a $2 million bond. Thaler is expected to surrender to authorities tomorrow.
If convicted, the defendants each face a maximum potential penalty of five years in prison on the conspiracy charge, 20 years in prison on each of the wire fraud charges, 10 years in prison on the obstruction of justice charge and five years in prison on the obstruction of an agency proceeding charge. Each charge also carries a maximum $250,000 fine, or twice the gross gain or loss from the offense. The indictment also seeks forfeiture of any proceeds traceable to the conspiracy, wire fraud and obstruction of justice offenses.
The case is being investigated by the Department of Justice Office of the Inspector General and prosecuted by Trial Attorneys Kevin Driscoll and Maria Lerner of the Criminal Division’s Public Integrity Section; Acting Deputy Chief Pamela Hicks, Acting Assistant Deputy Chief Jeannette Gunderson and Trial Attorney Ann Marie Blaylock of the Criminal Division’s Asset Forfeiture and Money Laundering Section; and Assistant U.S. Attorney Carlos Esqueda.
The charges and allegations contained in the indictment are merely accusations and the defendants are presumed innocent unless and until proven guilty.
Family Members in Alabama Plead Guilty in Million Dollar Stolen Identity Refund Fraud SchemeRead the Press Release
Several family members, all residents of Montgomery, Ala., pleaded guilty in the Middle District of Alabama to their involvement in a million dollar stolen identity refund fraud scheme, the Department of Justice and the Internal Revenue Service (IRS) announced today.
Veronica Temple and Yolanda Moses both pleaded guilty to one count of conspiracy to defraud the United States, one count of theft of public funds and one count of aggravated identity theft. Barbara Murry pleaded guilty to one count of conspiracy to defraud the United States and one count of aggravated identity theft. Douglas Murry pleaded guilty to one count of conspiracy to defraud the United States and one count of aggravated identity theft. Lee Moses and Jeffrey Temple both pleaded guilty to one count of filing a false tax return. Veronica Temple and Yolanda Moses are scheduled to be sentenced on Feb. 6, 2012. Sentencing dates for the other defendants have not been scheduled.
“The Tax Division is committed to prosecuting those who steal the personal identities of American taxpayers to commit tax refund fraud,” said Assistant Attorney General for the Justice Department’s Tax Division Kathryn Keneally. “We continue to work closely with the IRS to protect the public from these criminals.”
“Honest and law abiding citizens are frustrated by those who use deceit and fraud to line their pockets with other people’s money as well as skirt their own tax obligations,” said Richard Weber, Chief, IRS-Criminal Investigation. “The U.S. government and the people of the United States will not tolerate the misuse of our nation’s tax system to facilitate identity theft. IRS-Criminal Investigation will use every means available to investigate and bring to justice those who engage in the illegal use of other taxpayer’s information.”
On April 25, 2012, Barbara Murry, Douglas Murry, Yolanda Moses, Lee Moses, Veronica Temple, Jeffrey Temple and others were charged in a 33-count indictment by a federal grand jury on a variety of counts stemming from a stolen identity refund fraud scheme. According to court documents, all of the defendants are family members. Barbara Murry owned and operated B & B Weaving Shop, located in Montgomery. B& B Weaving Shop was located in the same building as B & B Tax Service. Barbara Murry’s daughter, Yolanda Moses, owned and operated B & B Tax Service.
The indictment alleges that Veronica Temple and her sister, Yolanda Moses, obtained stolen identities from multiple sources. Veronica Temple, Yolanda Moses and others filed false tax returns from B & B Tax Service and from their homes and directed the tax refunds from these returns to be deposited into over ten different bank accounts that were controlled by the defendants and their co-conspirators. Veronica Temple, Yolanda Moses and Barbara Murry recruited individuals in order to have false tax refunds deposited into their bank accounts, including Douglas Murry. Between January 2006 and April 2012, the defendants and their co-conspirators directed over 700 false tax refunds claiming in excess of $1.3 million to several bank accounts controlled by the defendants and their co-conspirators.
This case was investigated by Special Agents of the IRS - Criminal Investigation. Trial Attorneys Jason H. Poole and Michael Boteler of the Justice Department’s Tax Division and Assistant United States Attorney Jared Morris are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
Wednesday 17 October 2012
Two Former Hospital Employees Sentenced to Serve Time in Prison for Participating in Kickback Schemes at New York City HospitalRead the Press Release
WASHINGTON – Two former high-ranking employees of facilities operations at New York Presbyterian Hospital (NYPH) were sentenced in U.S. District Court for the Southern District of New York, in Manhattan, by Judge George B. Daniels today for their participation in two separate conspiracies involving kickbacks, the Department of Justice announced today.
Santo Saglimbeni, a former vice president of facilities operations at NYPH, was sentenced to serve 48months in prison and ordered to pay a $250,000 criminal fine. Emilio “Tony” Figueroa, a former director of facilities operations at NYPH, was sentenced to serve 36months in prison and ordered to pay a $25,000 criminal fine. Saglimbeni and Figueroa were ordered to jointly and severally pay $603,982 in total restitution to NYPH. Judge Daniels also entered a preliminary order of forfeiture for $2.3 million, which included certain bank accounts into which the kickback money from one of the schemes was deposited, as well as a parcel of land purchased with a portion of the kickback money, in Southampton, N.Y.
“Today’s sentences are consistent with the serious nature of the crimes for which the individuals were convicted,” said Acting Assistant Attorney General Joseph Wayland in charge of the Department of Justice’s Antitrust Division. “The division remains committed to holding accountable corrupt purchasing officials who undermine the competitive bidding process for their personal gain.”
On Feb. 2, 2012, after a four-week trial, Saglimbeni and Figueroa, along with Michael Yaron and two companies owned by him—Cambridge Environmental & Construction Corp., doing business as National Environmental Associates (Cambridge/NEA), and Oxford Construction & Development Corp.; Moshe Buchnik, the president of an asbestos abatement company doing business at NYPH; and Artech Corp., a sham company Saglimbeni created in the name of his mother, were each convicted of conspiracy to defraud NYPH. Additionally, Yaron, Cambridge/NEA, Oxford, Buchnik, Saglimbeni and Artech were also convicted of a wire fraud violation.
According to evidence presented at trial, the scheme to defraud NYPH centered on Saglimbeni, who with the assistance of Figueroa, awarded asbestos abatement, air monitoring and general construction contracts to Yaron, Buchnik and their companies in return for more than $2.3 million in kickbacks paid to Saglimbeni. A portion of those kickbacks were funneled by Yaron to Saglimbeni through Artech.
On July 31, 2012, Saglimbeni and Figueroa each pleaded guilty to additional mail fraud conspiracy and mail fraud violations. These charges were part of the same indictment but had been severed and were scheduled for a separate trial. According to the superseding indictment, the fraud scheme also centered on Saglimbeni, who with the assistance of Figueroa, awarded heating, ventilation and air conditioning (HVAC) contracts to an HVAC vendor in return for kickbacks in the form of cash goods and services paid to Saglimbeni and Figueroa.
On July 10, 2012, Yaron, Buchnik and the three companies were sentenced for their respective roles in the scheme. Yaron was sentenced to serve 60 months in prison and ordered to pay a $500,000 criminal fine. Buchnik was sentenced to serve 48 months in prison and ordered to pay a $500,000 criminal fine. Yaron’s companies, Cambridge/NEA and Oxford Construction, were each sentenced to pay a $1 million criminal fine. Artech was also sentenced to pay a $1 million criminal fine. Including Saglimbeni and Figueroa, 15 individuals and six companies have been convicted or pleaded guilty as a result of this investigation and have been sentenced to pay a total of more than $4 million in criminal fines and to serve more than 16 years in prison.
This antitrust investigation of bid rigging, fraud, bribery and tax-related offenses relating to the award of contracts by the facilities operations department of NYPH was conducted by the Antitrust Division’s New York Field Office with the assistance of the FBI and the Internal Revenue Service - Criminal Investigation’s New York Field Office. The Office of International Affairs in the Justice Department’s Criminal Division also provided assistance. Anyone with information concerning bid rigging, bribery, tax offenses or fraud related at NYPH should contact the Antitrust Division’s New York Field Office of the at 212-335-8000, visit www.justice.gov/atr/contact/newcase.htm, or call the FBI’s New York Division at 212-384-1000.
Massachusetts Businessman Sentenced to Prison for Tax Evasion and Conspiracy to Obstruct and Impede the IRSRead the Press Release
A federal judge in Boston sentenced Gary Alcock today to 14 months in prison for tax evasion, for conspiring to defraud the United States, and for willfully failing to file tax returns, the Justice Department and Internal Revenue Service (IRS) announced. U.S. District Judge F. Dennis Saylor also ordered Gary Alcock to pay restitution in the amount of $515,518. Alcock pleaded guilty to the charges on Dec. 9, 2011, and provided substantial assistance to the government in prosecuting the case against the remaining defendants, which Judge Saylor cited, among other factors, as a basis for a reduced sentence.
Alcock, a resident of Westborough, Mass., testified at a trial of three defendants which resulted in guilty verdicts rendered by a federal jury on April 2, 2012. The jury convicted Charles Adams of Norwood, Mass., as well as Catherine Floyd and William Scott Dion, both of Sanbornville, N.H., for conspiracies to defraud the United States through the promotion and use of multiple tax fraud schemes. The jury convicted all three of conspiracy to defraud the IRS by promoting an “under the table” payroll scheme doing business as Contract America. Dion and Floyd were also convicted for conspiracy to defraud the IRS through the use of an “underground warehouse banking” scheme designed to conceal subscriber income and assets from the IRS.
Gary Alcock was a subscriber to the services of Dion, Floyd and Adams. According to the information presented in court, Alcock owned and operated a trash hauling business called G&K Trucking, as well as a landscaping business called Bark, Mulch and Loam in Shrewsbury, Mass. Between 2001 and 2004, Alcock employed the banking and nominee services of Dion and Floyd to set up a nominee company called “Alex Management” to divert and hide business receipts, to help his businesses fraudulently “disappear” on paper, and, thus, to evade IRS assessments and IRS collection activity. Alcock further used the services of Contract America, run by Adams, Dion and Floyd, in order to pay his employees “under the table” without withholding and paying over Social Security, Medicare and income taxes.
Judge Saylor previously sentenced Dion to seven years in prison, Floyd to five years in prison, and Adams to four years in prison for promoting these schemes.
In August 2009, Alcock, along with Dion, Floyd, Adams and three other individuals, were indicted for the promotion and use of these schemes. On Dec. 9, 2011, prior to trial, Gail and Myron Thorick of West Warwick, R.I., pleaded guilty to conspiring to defraud the United States by helping operate the “warehouse banking” scheme, and for filing false tax returns. On Jan. 24, 2012, Kenneth Scott Alcock, Gary Alcock’s brother, pleaded guilty to conspiracy relating to the payroll scheme and to one count of tax evasion. The Thoricks and Kenneth Scott Alcock await sentencing in November.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, and Carmen M. Ortiz, U.S. Attorney for the District of Massachusetts, commended the efforts of special agents of IRS - Criminal Investigation, who investigated the case. Tax Division Assistant Chief John N. Kane, former Tax Division Trial Attorney Jeffrey Shih, and Assistant U.S. Attorney Victor A. Wild prosecuted the case.
Man Pleads Guilty in New York to Conspiring with Iranian Military Officials to Assassinate Saudi Arabian Ambassador to the United StatesRead the Press Release
Manssor Arbabsiar, aka Mansour Arbabsiar, pleaded guilty today in federal court in the Southern District of New York to participating in a plot to murder the Saudi Arabian Ambassador to the United States while the Ambassador was in the United States. Arbabsiar, a 58-year-old naturalized U.S. citizen holding both Iranian and U.S. passports, was arrested on Sept. 29, 2011, at New York’s John F. Kennedy International Airport. He pleaded guilty today before U.S. District Judge John F. Keenan.
The guilty plea was announced by Attorney General Eric Holder; Michele M. Leonhart, Administrator of the Drug Enforcement Administration ( DEA); Lisa Monaco, Assistant Attorney General for National Security; Preet Bharara, U.S. Attorney for the Southern District of New York; and Stephen L. Morris, FBI Houston Special Agent in Charge.
Arbabsiar pleaded guilty to a superseding information that charges him with three counts. Count one charges Arbabsiar with traveling in foreign commerce and using interstate and foreign commerce facilities in the commission of murder-for-hire. Count two charges him with conspiring to do so. Count three charges Arbabsiar with conspiring to commit an offense against the United States, namely, an act of terrorism transcending national boundaries. He faces a maximum potential sentence of 25 years in prison (10 years on counts one and two, and five years on count three). Arbabsiar is scheduled to be sentenced by Judge Keenan on Jan. 23, 2013, at 11:30 a.m.
In connection with his guilty plea, Arbabsiar admitted that, from the spring of 2011 to the fall of 2011, he conspired with officials in the Iranian military who were based in Iran, to cause the assassination of the Saudi Arabian Ambassador while the Ambassador was in the United States. Arbabsiar acknowledged that at the direction of these co-conspirators, he traveled to Mexico on several occasions during 2011 in order to arrange the assassination of the Ambassador. Arbabsiar admitted that, with his co-conspirators’ approval, he had arranged to hire a DEA confidential source (CS-1), who claimed to be a representative of a drug cartel, and CS-1’s criminal associates, to murder the Ambassador. Arbabsiar further admitted that he agreed to pay $1.5 million to CS-1 and had discussed with CS-1 a plan to murder the Ambassador at a restaurant in Washington, D.C. -- a plan that was approved by Arbabsiar’s co-conspirators. Arbabsiar then arranged for a $100,000 down payment, in two installments, to be wired to CS-1.
As noted in the complaint and indictment previously filed in Manhattan federal court, t he Qods Force is a branch of the Iranian Islamic Revolutionary Guard Corps (IRGC). The Qods Force conducts sensitive covert operations abroad, including terrorist attacks, assassinations and kidnappings, and is believed to have sponsored attacks against Coalition Forces in Iraq. In October 2007, the U.S. Treasury Department designated the Qods Force under Executive Order 13224 for providing material support to the Taliban and other terrorist organizations.
“A little more than a year after his arrest, Manssor Arbabsiar has admitted to his role in a deadly plot approved by members of the Iranian military to assassinate a sitting foreign Ambassador on U.S. soil,” said Attorney General Holder. “Today’s plea and the disruption of this plot should serve as a reminder of the exceptional efforts of our law enforcement and intelligence agencies in protecting America against terrorist attacks and in holding accountable those who plan such actions.”
“The dangerous connection between drug trafficking and terrorism cannot be overstated, and this case is yet another example of DEA’s unique role in identifying potentially deadly networks that wish to harm innocent Americans and our allies worldwide,” said DEA Administrator Leonhart. “Using DEA’s elaborate and sophisticated investigative expertise to infiltrate violent drug and terror organizations globally, we successfully identified this threat and worked closely with the FBI to prevent a potentially deadly outcome.”
“Thanks to the collaborative efforts of many U.S. law enforcement and intelligence professionals, this international assassination plot hatched in Iran was thwarted before anyone was harmed and a key conspirator has pleaded guilty. This case underscores the evolving threat environment we face and the need for continued vigilance at home and abroad,” said Assistant Attorney General Monaco.
U.S. Attorney Bharara stated: “As was originally charged, and as Arbabsiar has now admitted, he was the extended murderous hand of his co-conspirators, officials of the Iranian military based in Iran, who plotted to kill the Saudi Ambassador in the United States and were willing to kill as many bystanders as necessary to do so. Arbabsiar traveled to and from the United States, Mexico and Iran and was in telephone contact with his Iranian confederates while he brokered an audacious plot. The audacity of the plot should not cause doubt, but rather vigilance regarding others like Arbabsiar, who are enlisted as the violent emissaries of plotting foreign officials. This office will continue to pursue the co-conspirators in this plot and others in Iran or elsewhere who try to export murder. Thanks to the great work of the FBI, DEA and the prosecutors in this office, Mr. Arbabsiar must now answer for his conduct.”
“Today’s guilty plea entered by Mr. Arababsiar is the culmination of exceptional intelligence and law enforcement efforts,” said FBI Special Agent in Charge Morris. “I would like to thank the investigators, analysts and task force officers at the FBI and DEA in Houston, our Legal Attaché Office in Mexico City, and all partners in the Intelligence Community who worked tirelessly on this case. Of special note I’d like to recognize the exemplary leadership from Department of Justice’s National Security Division and the U.S. Attorney’s Office in the Southern District of New York.”
According to the complaint and indictment filed in Manhattan federal court, as well as the information to which Arbabsiar pleaded:
Arbabsiar met with CS-1 in Mexico on multiple occasions between May 2011 and July 2011. During the course of these meetings, Arbabsiar inquired as to CS-1’s knowledge with respect to explosives and explained that he was interested in, among other things, attacking an embassy of Saudi Arabia and the murder of the Saudi Ambassador to the United States. In a July 14, 2011, meeting in Mexico, CS-1 told Arbabsiar that he would need to use at least four men to carry out the Ambassador’s murder and that his price for carrying out the murder was $1.5 million. Arbabsiar agreed and stated that the murder of the Ambassador should be handled first, before the execution of other attacks that Arbabsiar had discussed with CS-1. Arbabsiar also indicated that he and his associates had $100,000 in Iran to pay CS-1 as a first payment toward the assassination.
During the same meeting, Arbabsiar also described to CS-1 his cousin in Iran, who he said had requested that Arbabsiar find someone to carry out the Ambassador’s assassination. Arbabsiar indicated that his cousin was a “big general” in the Iranian military; that he focuses on matters outside of Iran and that he had taken certain unspecified actions related to a bombing in Iraq.
In a July 17, 2011, meeting in Mexico, CS-1 noted to Arbabsiar that one of his workers had already traveled to Washington, D.C., to surveil the Ambassador. CS-1 also raised the possibility of innocent bystander casualties. Arbabsiar made it clear that the assassination needed to go forward, despite mass casualties, telling CS-1, “They want that guy [the Ambassador] done [killed], if the hundred go with him f**k ‘em.” CS-1 and Arbabsiar discussed bombing a restaurant in the United States that the Ambassador frequented. When CS-1 noted that others could be killed in the attack, including U.S. senators who dine at the restaurant, Arbabsiar dismissed these concerns as “no big deal.”
On Aug. 1 and Aug. 9, 2011, Arbabsiar caused two overseas wire transfers totaling approximately $100,000 to be sent to an FBI undercover account as a down payment for CS-1 to carry out the assassination. Later, Arbabsiar explained to CS-1 that he would provide the remainder of the $1.5 million after the assassination. On Sept. 20, 2011, CS-1 told Arbabsiar that the operation was ready and requested that Arbabsiar either pay one half the agreed upon price ($1.5 million) for the murder or that Arbabsiar personally travel to Mexico as collateral for the final payment of the fee. Arbabsiar agreed to travel to Mexico to guarantee final payment for the murder.
On Sept. 28, 2011, Arbabsiar flew to Mexico. Arbabsiar was refused entry into Mexico and was placed on a return flight destined for his last point of departure. On Sept. 29, 2011, Arbabsiar was arrested by federal agents during a flight layover at JFK International Airport in New York. Several hours after his arrest, Arbabsiar was advised of his Miranda rights and he agreed to waive those rights and speak with law enforcement agents. During a series of Mirandized interviews, Arbabsiar confessed to his participation in the murder plot.
Arbabsiar also admitted to agents that, in connection with this plot, he was recruited, funded, and directed by men he understood to be senior officials in Iran’s Qods Force. He said these Iranian officials were aware of and approved of the use of CS-1 in connection with the plot; as well as payments to CS-1; the means by which the Ambassador would be killed in the United States and the casualties that would likely result.
Arbabsiar also told agents that his cousin, who he had long understood to be a senior member of the Qods Force, had approached him in the early spring of 2011 about recruiting narco-traffickers to kidnap the Ambassador. Arbabsiar told agents that he then met with CS-1 in Mexico and discussed assassinating the Ambassador. Arbabsiar said that, afterwards, he met several times in Iran with Gholam Shakuri, aka “Ali Gholam Shakuri,” a co-conspirator and Iran-based member of the Qods Force, and another senior Qods Force official, where Arbabsiar explained that the plan was to blow up a restaurant in the United States frequented by the Ambassador and that numerous bystanders would be killed. The plan was approved by these officials.
In October 2011, after his arrest, Arbabsiar made phone calls at the direction of law enforcement to Shakuri in Iran that were monitored. During these phone calls, Shakuri confirmed that Arbabsiar should move forward with the plot to murder the Ambassador and that he should accomplish the task as quickly as possible, stating on Oct. 5, 2011, “[j]ust do it quickly, it’s late…” Shakuri also told Arbabsiar that he would consult with his superiors about whether they would be willing to pay CS-1 additional money. Shakuri, who was also charged in the plot, remains at large. The charges against Shakuri are merely accusations, and he is presumed innocent unless and until proven guilty.
This investigation is being conducted by the FBI Houston Division, the DEA Houston Division and the FBI New York Joint Terrorism Task Force. The prosecution is being handled by the Terrorism and International Narcotics Unit of the U.S. Attorney’s Office for the Southern District of New York, specifically Assistant U.S. Attorneys Glen Kopp, Edward Kim and Stephen Ritchin. The Counterterrorism Section of the Justice Department’s National Security Division and the Office of International Affairs of the Justice Department’s Criminal Division provided substantial assistance. The government of Mexico is also recognized for its cooperation in this matter.
Four Members of LSP Street Gang Sentenced in Ohio for Roles in Racketeering ConspiracyRead the Press Release
WASHINGTON – Four LSP street gang member were sentenced today for their roles in a racketeering conspiracy (RICO) that used violence, including attempted murder, to control territory and sell heroin, cocaine and other drugs, announced Assistant Attorney General for the Justice Department’s Criminal Division Lanny A. Breuer; Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio; and Stephanie R. Shoemaker, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Columbus Field Division.
U.S. District Judge Nugent sentenced Derrick Johnson Jr. to 65 years in prison; Daquann Hackett to 37 years in prison; Terrance Machen Jr. to 110 months in prison; and Edward Campbell to 90 months in prison.
On June 28, 2012, Hackett, 22, Johnson, 22, Machen, 21, and Campbell, 21, all of Youngstown, Ohio, were convicted by a jury in the Northern District of Ohio of conspiring to form and operate a racketeering enterprise, the LSP street gang. Hackett and Johnson were identified as leaders of LSP.
Eighteen other people previously pleaded guilty to conspiring to form and operate a racketeering enterprise following an indictment in March 2011.
Hackett, Johnson, Machen and Campbell were convicted of participating in a conspiracy that lasted at least eight years and involved crimes including several attempted murders, conspiracy to commit murder, witness tampering, retaliation, firearms trafficking and drug trafficking. According to court documents, LSP used violence to guard its drug distribution territory, intimidate rival gangs and others, retaliate against those who cooperated with law enforcement and expand its power and reputation. Witnesses testified at trial that LSP members were expected to carry, share and use firearms as part of the gang and often wore bullet proof vests.
At trial, witnesses testified that in March 2009, LSP gang members in two cars committed a drive by shooting against an individual rival of the enterprise. According to trial testimony, LSP members used several firearms, including two shotguns, to fire into the rival’s home; one victim was shot in the head, and another victim was shot in the foot. Johnson was convicted of attempted murder in aid of a racketeering enterprise related to this act.
Witnesses at trial testified that Hackett and Johnson both operated houses in LSP territory where enterprise members were permitted to sell crack cocaine. According to trial testimony, during one drug transaction with a confidential informant, Hackett and Johnson discovered a recording device, pistol whipped the informant and attempted to drag him out of the house and behind a garage to murder him. Hackett and Johnson were both convicted of attempted murder in aid of a racketeering enterprise related to this act.
Hackett was convicted of 19 counts in addition to the RICO conspiracy, including violent crimes in aid of racketeering, use of a firearm in a crime of violence, distribution of narcotics, conspiracy to distribute narcotics and retaliation (attempted murder).
Johnson was convicted of seven counts in addition to the RICO conspiracy, including violent crimes in aid of racketeering, use of a firearm in a crime of violence, conspiracy to distribute cocaine base (crack) and retaliation.
This case was prosecuted by Assistant U.S. Attorneys Daniel Riedl and Robert Corts and Trial Attorney Kevin Rosenberg of the Criminal Division’s Organized Crime and Gang Section. The case was investigated by the ATF, with assistance from the Youngstown Police Department and the Mahoning, Ohio, County Prosecutor’s Office.
Detroit Area Gas Station Owner and His Bookkeeper Sentenced to Prison for Tax FraudRead the Press Release
U.S. District Judge Patrick J. Duggan sentenced Elsayed Kazem “Tom” Safiedine to 21 months in prison and Mary Fawaz to 12 months and one day in prison for tax fraud, the Justice Department and the Internal Revenue Service (IRS) announced today. Safiedine and Fawaz were convicted by a Detroit jury of conspiring to defraud the United States by impeding and impairing the lawful functions of the IRS.
According to evidence at trial, Safiedine was an officer and member of multiple business entities that operated and leased gasoline stations in the Detroit area. Fawaz was an officer of JSC Corporation, a business operated by Safiendine, and also served as a bookkeeper and office manager for several of Safiedine’s businesses. The evidence established that from 1998 through 2001, Safiedine and Fawaz arranged for third parties to negotiate checks from Sunoco Incorporated made payable to JSC Corporation. The checks from Sunoco, which totaled $845,000, were not properly reported to the accountant for JSC Corporation and as a result, were not included as income on JSC’s corporate tax returns filed with the IRS.
Further evidence presented revealed that Safiedine and Fawaz participated in the sale of a gasoline station owned by one of Safiedine’s businesses, MTK & KLC Partnership, during which Safiedine and Fawaz advised the accountant for MTK & KLC that the gas station sold for $175,000 less than its actual sale price, thus resulting in an understatement of income on the MTK & KLC partnership income tax return.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, and Barbara L. McQuade, U.S. Attorney for the Eastern District of Michigan, commended the IRS Special Agents who investigated this case and Tax Division Trial Attorneys Mark W. Kotila and Tiwana L. Wright, who prosecuted the case.
Clinic Owners Plead Guilty in Detroit-Area<br /> Infusion Therapy SchemeRead the Press Release
WASHINGTON – Two owners and operators of clinics that claimed to specialize in treating HIV and other conditions pleaded guilty today for their roles in an infusion therapy scheme carried out at two Detroit-area clinics that submitted millions of dollars in fraudulent claims to Medicare.The guilty pleas were announced by Assistant Attorney General Lanny A. Breuer of the Department of Justice’s Criminal Division; U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan; Special Agent in Charge Robert Foley III of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (HHS-OIG) Chicago Regional Office.
Raymond Arias, 40, and his wife, Emelitza Arias, 25, of Troy, Mich., each pleaded guilty, before U.S. District Judge Paul D. Borman of the Eastern District of Michigan, to one count of conspiracy to commit health care fraud. At sentencing, the defendants each face a maximum potential penalty of 10 years in prison and a $250,000 fine. Sentencing is currently scheduled for Feb. 12, 2013.
According to plea documents, Raymond Arias conceived of and oversaw fraud schemes at two clinics for which he was a beneficial owner: Elite Wellness LLC, and Carefirst Occupational & Rehabilitation Center Inc. He admitted to paying physicians to refer Medicare beneficiaries to Elite Wellness, and to purchasing Medicare beneficiary identifications for the purpose of submitting fraudulent claims to Medicare for expensive infusion therapy services that were not rendered as claimed by Carefirst.
According to court documents, Raymond Arias attempted to hide the Elite Wellness scheme from law enforcement by directing a nominee owner to assume control of the claims submitted and the bank account into which Medicare payments were deposited. After the nominee owner became involved, Raymond Arias and his alleged co-conspirators submitted approximately $10 million in claims over a 3-month period beginning in August 2010.
According to court documents, Raymond Arias directed this nominee to transfer approximately $2.6 million in Medicare payments offshore to Panama and Mexico.
Between approximately October 2009 and October 2010, Raymond Arias admitted, he and his alleged co-conspirators at Elite Wellness submitted or caused to be submitted approximately $12.5 million in fraudulent claims to the Medicare program for infusion therapy services that were not rendered. Medicare paid approximately $5.4 million of those claims.
According to plea documents, Emelitza Arias participated with her husband in a scheme to defraud Medicare by submitting claims for expensive infusion therapy services that were not rendered by Carefirst, of which she was also an owner. In an attempt to create an appearance that Carefirst was a legitimate enterprise, Emelitza Arias injected Medicare beneficiaries with vitamins. Emelitza Arias also assumed responsibility for the claims submitted by Carefirst, and managed the bank account into which the fraud proceeds were deposited.
Between approximately July 2010 and June 2011, Raymond and Emelitza Arias and their alleged co-conspirators at Carefirst submitted or caused to be submitted more than $900,000 in fraudulent claims to the Medicare program for infusion therapy services that were not rendered. Medicare paid approximately $530,000 of those claims.
This case is being prosecuted by Assistant U.S. Attorney Philip A. Ross of the Eastern District of Michigan and Trial Attorney Catherine K. Dick of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG and brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
Attorney General Holder Recognizes Department Employees and Others for Their Service at Annual Awards CeremonyRead the Press Release
Attorney General Eric Holder recognizes 282 department employees for their distinguished public service today at the 60th Annual Attorney General’s Awards Ceremony. Fifty-seven other individuals outside of the department are also honored for their work. Held at DAR Constitution Hall, this annual ceremony recognizes both department employees and others for their outstanding dedication to carrying out the Department of Justice’s missions.
“This year’s award recipients have made significant contributions across, and far beyond, the Department of Justice and helped to protect the rights, safety and best interests of the citizens we are privileged to serve,” Attorney General Holder said. “I am grateful for the dedication and passion that these extraordinary public servants bring to their work, and I am honored to count them as colleagues.”
Attorney General Holder and Deputy Attorney General James M. Cole present the Attorney General’s Award for Exceptional Service – the department’s highest award for employee performance – to the team responsible for the successful prosecution of 10 New Orleans police officers convicted of killing innocent civilians in the aftermath of Hurricane Katrina.
The Attorney General’s Award for Exceptional Service is presented to members of the investigative and litigation team responsible for one of the largest police-misconduct cases ever brought by the Department of Justice. The evidence discovered by the prosecution team revealed that shortly after Hurricane Katrina, several New Orleans police officers used assault rifles and a shotgun to shoot six innocent people on the Danziger Bridge, killing two and seriously wounding four others. In concert with supervisors and homicide investigators, the officers began a stunning cover-up. Ultimately, a jury convicted the defendants.
The recipients of the Attorney General’s Award for Exceptional Service include, from the Civil Rights Division’s Criminal Section, Deputy Chief Bobbi Bernstein; Special Litigation Counsel Forrest Christian; Trial Attorney Cindy K. Chung; Paralegal Specialist Steven D. Harrell; and from the FBI’s Philadelphia Field Office, Special Agent William M. Bezak.
The Attorney General’s Award for Exceptional Heroism is given to recognize an extraordinary act of courage and voluntary risk of life during the performance of official duties. This year’s award is presented to John M. Long, Senior Inspector for the U.S. Marshals Service (USMS) Investigative Operations Division. On Dec. 9, 2011, Mr. Long risked his life to protect a victim from a brutal attack by a dangerous fugitive wanted for abduction, theft and parole violation. Johnny Jones, a violent offender, broke into the home of his former wife, brutally attacking her. The following day while conducting surveillance, Mr. Long confronted Jones at gunpoint, grabbed the ex-wife and protected her from danger as Jones retreated back into the house. Mr. Long and his law enforcement partners then tracked Jones to a second location where he ultimately surrendered.
The Edward H. Levi Award for Outstanding Professionalism and Exemplary Integrity is presented to pay tribute to the memory and achievements of former Attorney General Edward H. Levi, whose career as an attorney, law professor, dean and public servant exemplified these qualities in the best traditions of the department. This year’s award is presented to Stuart M. Goldberg, Principal Associate Deputy Attorney General. Mr. Goldberg is honored for his extraordinary professionalism in senior positions throughout the department over the course of more than 24 years
Over his distinguished career, he has performed his duties in each position of increased responsibility in such an exemplary manner that will serve as a model for excellence and professionalism in the department. Mr. Goldberg regularly handles sensitive matters with outstanding professionalism and leadership, and routinely ensures that department attorneys have the resources and training necessary to appreciate professional responsibility and ethics. Because of his extraordinary talents, Mr. Goldberg has played a leading role in many important department matters over the past several years.
The Mary C. Lawton Lifetime Service Award recognizes employees who have served at least 20 years in the department and have demonstrated high standards of excellence and dedication throughout their careers. This award is presented only in exceptional circumstances to those individuals of special merit and is not awarded to express general appreciation for tenure alone.
This year’s award is presented to John J. Dion¸ Chief of the National Security Division’s Counterespionage Section. Mr. Dion has been involved in the investigation and prosecution of almost every spy prosecuted in the United States over the past 31 years. He is also a frequent lecturer at the FBI and in the intelligence community on national security investigations and prosecutions. Mr. Dion’s outstanding contributions have been recognized through the Intelligence Community Seal Medallion and the Medal of Distinguished Service from the National Reconnaissance Office.
The William French Smith Award for Outstanding Contributions to Cooperative Law Enforcement is an honorary award granted to recognize state and local law enforcement officials who have made significant contributions to cooperative law enforcement endeavors.
This year’s award is presented to task force officers responsible for closing more than 3,300 warrants, recovering more than five missing and abused children, and successfully completing more than nine sex-offender compliance checks. Most recently, the Eastern District of Pennsylvania Task Force Officers (TFOs) displayed exceptional bravery and skills while responding to armed suspects and aiding their fellow TFO who had been shot and killed in the line of duty. Eastern North Carolina TFOs also displayed exceptional bravery after being fired upon by suspects from behind closed doors.
The recipients of The William French Smith Award for Outstanding Contributions to Cooperative Law Enforcement include, from the Pennsylvania State Police, Sergeant Adam R. Kosheba and Detective Timothy C. Flickinger; from the Berk’s County, Penn., Sheriff’s Department, Deputy Sheriff Kyle D. Pagerly (posthumous); from the Greenville, N.C., Police Department, Officer Timothy S. McInerney; from the Pitt County, N.C., Sherriff’s Department, Deputy Sherriff Joseph G. Reason; from the Kinston, N.C., Department of Public Safety, Officer Jimmy R. Moody Jr.; from the North Carolina Department of Justice, Special Agent Christopher W. Dawson; and from the Nash County, N.C. Sherriff’s Office, Investigator Warren B. Lewis (posthumous).
The Attorney General’s Award for Meritorious Public Service is the top public service award granted by the department, and is designed to recognize the most significant contributions of citizens and organizations that have assisted the Department of Justice in the accomplishment of its mission and objectives. This year’s award is presented to Ellen Pence Ph.D. (posthumous), Executive Director for Praxis International’s Office on Violence Against Women. Her inter-agency collaboration model, the Duluth Domestic Abuse Intervention Project, is used in all 50 states and more than 17 countries, as well as in tribes throughout the United States. Her framework of a coordinated community response to domestic violence permeates many of the programs authorized under the Violence Against Women Act administered by the Office on Violence Against Women.
The Attorney General’s Award for Distinguished Service is the Justice Department’s second highest award for employee performance. The recipients of this award exemplify the highest commitment to the department’s mission. Fourteen Distinguished Service Awards were presented this year to individuals or teams of people.
The first Distinguished Service Award is presented to members of the investigative and litigation team responsible for the successful prosecution of United States v. AU Optronics et al., participants in a n international cartel that fixed the price of liquid crystal display (LCD) panels used in computers, laptops and televisions sold in the United States and around the world. The investigation resulted in nearly $1.4 billion in criminal fines against companies involved in the conspiracy and a recent conviction at trial of one of the world’s largest manufacturers of LCD monitors, its U.S. subsidiary, and its two highest ranking executives. In addition to returning guilty verdicts against these defendants, the jury also found that the ill-gotten gain to the conspirators was at least $500 million, thereby raising the statutory maximum corporate fine from $100 million to $1 billion for the offense. This case represented the first time that the Antitrust Division litigated the issue of ill-gotten gain before a jury. This successful prosecution sends a powerful message, deterring international cartels that may be tempted to target U.S. businesses and consumers.
Award recipients include, from the Antitrust Division, Deputy Assistant Attorney General Scott D. Hammond; from the division’s San Francisco Field Office, Chief Phillip H. Warren and Assistant Chief Peter K. HustonTrial Attorneys, Lidia Maher, E. Kate Patchen, Christopher M. Ries, Michael L. Scott, Brent C. Snyder, Heather S. Tewksbury and Micah L. Wyatt; Paralegal Specialists Nicole A. Beach, Alicia M. Berenyi, Justin L. Brooke, Divya Musinipally and Lechuan Zhou; Secretary Liliana Cruz Vallejo; from the division’s National Criminal Enforcement Section, Trial Attorney Jon B. Jacobs; from the division’s Networks and Technology Enforcement Section, Trial Attorney Sanford M. Adler; from the division’s Appellate Section, Trial Attorneys James J. Fredricks and Kristen C. Limarzi; from the division’s Paralegal Unit, Paralegal Specialist William E. Cuomo; from the division’s Economic Regulatory Section, Economist Matthew Magura; from the division’s Competition Policy Section, Economist Michael T. Sandfort; from the division’s Economic Litigation Section, Senior Economic Counsel Gregory J. Werden and Economist Peter A. Woodward; and from the FBI’s San Francisco Field Office, Special Agent Claire Duda.
The second Distinguished Service Award is presented to the team whose service and dedication to the Prison Rape Elimination Act (PREA) Working Group led to the completion of one of the largest and most complex rulemakings in the Department of Justice’s recent history. The work on this project, which has resulted in a comprehensive set of national standards aimed at eliminating sexual abuse in our nation’s confinement facilities, was of an outstanding and distinctive character. These individuals conducted an in-depth review and revision of standards recommended by the National Prison Rape Elimination Commission, and engaged with a wide range of relevant stakeholders, culminating in publication of a detailed final rule with extensive justifications of the standards and responses to public comments.
Award recipients include, from the Office of the Deputy Attorney General, Senior Counsel to the Deputy Attorney General Eric R. Columbus; from the Access to Justice Initiative, Senior Counsel Daniel B. Olmos; from the Office of the Assistant Attorney General for the Office of Legal Counsel, Deputy Assistant Attorney General Cristina Maria Rodriguez; Attorney-Advisor Bonnie I. Robin-Vergeer; and Special Counsel Rosemary A. Hart; from the Eastern District of New York, Supervisory Assistant U.S. Attorney F. Franklin Amanat; from the Bureau of Justice Assistance, Senior Policy Advisor for Corrections Gary L. Dennis Ph.D.; from the Bureau of Justice Statistics, Senior Statistical Advisor Allen J. Beck Ph.D.; from the Office of Juvenile Justice and Delinquency Prevention, Compliance Monitoring Coordinator Elissa Rumsey; from the Bureau of Prisons (BOP), Deputy General Counsel Kenneth P. Hyle; from the BOP’s National Institute of Corrections, Program Specialists Lorie Brisbin and Deborah “Dee” Halley; from the Civil Rights Division’s Special Litigation Section, Senior Trial Attorneys Kerry K. Dean and Joshua C. Delaney; and from the Office on Violence Against Women, Attorney-Advisor Marnie R. Shiels.
The third Distinguished Service Award is presented to the individuals involved in procuring a $25 billion mortgage servicing settlement between the United States, 49 state attorneys general and the five largest mortgage servicers, representing the largest federal-state settlement in history. The settlement includes comprehensive new mortgage loan servicing standards, $5 billion to state and federal treasuries and borrowers who lost their homes to foreclosure, $20 billion in consumer relief and a $1 billion resolution of False Claims Act recoveries by the Eastern District of New York.
Award recipients include, from the Office of the Associate Attorney General, Senior Counsel and Chief of Staff Brian Hauck; from the Civil Division’s Fraud Section, Deputy Director Michael D. Granston and Trial Attorney John Warshawsky; from the Civil Rights Division’s Housing and Civil Enforcement Section, Trial Attorneys Elizabeth A. Singer, Amber R. Standridge and Daniel Yi; from the Eastern District of New York, Assistant U.S. Attorneys Kenneth M. Abell and Richard K. Hayes; from the District of Colorado, Assistant U.S. Attorney J. Chris Larson; from the District of Colorado’s Civil Division, Chief Kevin T. Traskos; from the Colorado Attorney General’s Office Consumer Protection Section, First Assistant Attorney General Andrew P. McCallin; from the Florida Office of the Attorney General’s Division of Economic Crimes, Bureau Chief Victoria A. Butler; from the North Carolina Department of Justice’s Consumer Protection Division, Assistant Attorney General Philip A. Lehman; from the Office of the Connecticut Attorney General’s Finance Department, Assistant Attorney General Matthew J. Budzik; from the Office of the Illinois Attorney General’s Consumer Protection Division, Chief Deborah A. Hagan; from the Office of the Attorney General of Texas’ Consumer Protection Division, Assistant Attorney General James A. Daross; from the Washington Office of the Attorney General, Senior Counsel David W. Huey; and from the Iowa Office of the Attorney General’s Consumer Protection Division, Assistant Attorney General Patrick T. Madigan.
The fourth Distinguished Service Award is presented to the team whose outstanding contribution led to the successful investigation and dismantling of the Coreflood Botnet, also known as Operation Adeona. The Coreflood Botnet was a collection of approximately 2.3 million compromised computers illegally controlled by subjects in Russia, which were then used to steal personal information and commit financial fraud on a massive scale. Operation Adeona was the first proactive seizure of a botnet by law enforcement authorities in the United States, utilizing an innovative legal framework and sophisticated technical means to cause the subjects to release control of the compromised computers.
Award recipients include, from the District of Connecticut, Assistant U.S. Attorneys Edward Chang and David C. Nelson; from the FBI’s Cyber Division, Supervisory Special Agents Thomas X. Grasso Jr. and Pedro D. Cordero; from the FBI’s International Operations Division, Supervisory Special Agent Michael J. Kolessar; from the FBI’s Memphis Field Office, Supervisory Special Agent Dean Kinsman; from the FBI’s New Haven, Conn., Field Office, Special Agents Jane M. Domboski, Kenneth W. Keller, Thomas S. Lawler, Briana L. Neumiller and Stephen L. Ney; from the Criminal Division, Supervisory Trial Attorney Richard W. Downing;and from the Criminal Division’s Computer Crime and Intellectual Property Section, Senior Counsel Josh Goldfoot.
The fifth Distinguished Service Award is presented to members of the investigation and prosecution team responsible for its outstanding work in combating the violent transnational criminal organization La Mara Salvatrucha (MS-13) that terrorized communities throughout the greater San Francisco metropolitan area. This complex racketeering investigation and prosecution spanned more than six years, and targeted an organization responsible for at least six murders and countless shootings, assaults and other acts of violence, as well as narcotics trafficking. The team’s relentless pursuit of this gang led to the conviction of more than 37 gang members on racketeering charges, with the most violent leaders of the gang receiving life sentences.
Award recipients include, from the Criminal Division’s Organized Crime and Gang Section, Trial Attorney Laura Gwinn ; from the Northern District of California, Assistant U.S. Attorneys William Frentzen, C. David Hall, Wai Shun Wilson Leung and Andrew M. Scoble; Paralegal Specialist Kevin P. Costello; Marina Ponomarchuk, Legal Technician; from the Northern District of Illinois, Assistant U.S. Attorney Derek Owens; from the FBI’s Criminal Investigative Division, Special AgentNikki Skovran; from the Department of Homeland Security, Supervisory Special Agent Christopher Merendino and Special Agents Brick A. Eubank, Rocio Franco, Benjamin W. Horton, Alicia MacDonald and John R. Moore; and from the San Francisco Police Department, Sergeants Dion J. McDonnell and Mario Molina.
The sixth Distinguished Service Award is presented to the Tribal Trust Negotiation Team for its sustained and excellent work in negotiating settlements with more than 40 Tribesin complex and long-running Tribal Trust cases. These settlements have obviated the need to prolong highly contentious litigation with these tribes, and will save the United States the significant resources that litigating these cases would have cost. On an expedited schedule, the team prepared offers for 75 separate tribes and reached favorable resolutions with more than 40 of the tribes. Collectively, the settlements in these cases will provide more than $1 billion to tribes in exchange for the dismissal of all trust mismanagement lawsuits.
Award recipients include, from the Office of the Associate Attorney General, Deputy Associate Attorney General Samuel Hirsch; from the Environment and Natural Resources Division, Principal Deputy Assistant Attorney General Robert Dreher; from the division’s Natural Resources Section, Chief Lisa L. Russell;Principal Deputy Chief Tom C. Clark; Senior Attorney Michael D. Thorp; Trial Attorneys Brian M. Collins, Joshua A. Doan, Joseph H. Kim, Matthew M. Marinelli, Romney S. Philpott, Jody H. Schwarz andStephen R. Terrell; and Special Litigation Counsel Anthony P. Hoang.
The seventh Distinguished Service Award is presented to the team for investigating and prosecuting Raj Rajaratnam and his criminal associates in a case that has made history as the largest insider trading case ever. Rajaratnam, the billionaire founder of the Galleon Group, was, for more than 10 years, the leader of an extensive network of insiders at public companies who repeatedly took advantage of ordinary investors and corrupted United States capital markets by trading based on material nonpublic information, reaping millions of dollars in illegal profits. This case represents the first use of wiretaps to prosecute insider trading schemes.
Award recipients include, from Southern District of New York, Assistant U.S. Attorneys Reed Brodsky, Andrew L. Fish, Andrew Z. Michaelson, Rahul Mukhi, Avi Weitzman and Jonathan R. Streeter (former); from the FBI’s Security Division, Special Agent B.J. Kang; from the FBI’s Criminal Investigative Division, Supervisory Special Agent James C. Barnacle, Jr.; from the FBI’s Charlotte Field Office, Special Agent Diane M. Wehner; from the FBI’s New York City Field Office, Special Agents Michael D. Brown, Kathleen M. Queally, Thomas J. Zukauskas and Forensic Accountants Wai-Mon Chan and Joan Mazzella.
The eighth Distinguished Service Award is presented to the team whose extraordinary service led to the prosecution of Ahmed Warsame, al Shabaab commander and emissary to Al Qaeda in the Arabian Peninsula (AQAP). Warsame was captured with the authorization of the president and by the U.S. military off the coast of Yemen. The FBI then later brought him to the Southern District of New York for prosecution on various terrorism-related offenses. The unparalleled coordination, dedication and teamwork among the department, the Department of Defense (DOD) and the intelligence community resulted in bringing an international terrorist to justice in a federal court.
Award recipients include, from the Southern District of New York, Assistant U.S. Attorneys Adam S. Hickey, Benjamin A. Naftalis and Criminal Investigator George F. Corey, Jr.; from the National Security Division’s Counterterrorism Section, Deputy Chief Alamdar S. Hamdani; from the FBI’s New York City Field Office, Supervisory Special Agents Carlos T. Fernandez, Michael A. Brodack andSpecial Agents Stefanie Roddy and Philip A. Swabsin; from the FBI’s Boston Field Office, Supervisory Special Agent Darryl Wegner; from the FBI’s Critical Incident Response Group, Special Agent Thomas J. Dugan IV; from the FBI’s Criminal Investigative Division, Supervisory Special Agent Janelle M. Miller; from the Office of the General Counsel, Supervisory Attorney-Advisor Lisa K. Matsumoto; from the U.S. Navy, Lieutenant Commander Robert B. Staley; from the U.S. Air Force, Major Richard G. Harris.
The ninth Distinguished Service Award is presented to the team whose outstanding work led to the successful prosecution of former Illinois Governor Rod Blagojevich and others for fraud, extortion and bribery relating to corrupt acts that occurred from 2002 through 2008. The team’s dedicated and exhaustive pursuit of evidence, as well as its compelling presentation of that evidence over multiple lengthy trials, resulted in the conviction of Blagojevich, two chiefs of staff and four others for crimes related to the selling of a U.S. Senate seat, the extortion of a children’s hospital, the attempted bribery of a campaign contributor, as well as other criminal acts.
Award recipients include, from the Northern District of Illinois, Assistant U.S. Attorneys Debra R. Bonamici, Carrie E. Hamilton ,Christopher S. Niewoehner (former) and Reid J. Schar (former); Paralegal Specialist Chrissy M. Stein; from the FBI’s Chicago Field Office, Supervisory Special Agent Patrick J. Murphy and Special Agents David D. Bray II, Daniel W. Cain and Jay G. Hagstrom; from the U.S. Department of the Treasury’s Internal Revenue Service, Supervisory Special Agent Vikas K. Arora; U.S. Department of Labor’s Office of the Inspector General, Special Agent Irene E. Lindow; U.S. Postal Inspection Service, Postal Inspector Silvia M. Carrier.
The 10th Distinguished Service Award is presented to INTERPOL Senior Inspector Joseph J. DeLuca for his outstanding leadership and law enforcement coordination in the apprehension and extradition of international fugitives, as evidenced by his assistance in the capture of a subject wanted by authorities in Quebec for a 1997 homicide. Mr. DeLuca also exhibits remarkable leadership abilities with regard to the administration, orientation and training of the USMS personnel assigned to INTERPOL Washington on a temporary basis. His diplomatic approach, fluency in five languages and understanding of foreign cultural differences has directly and positively impacted the United States and other countries’ capacity to locate international fugitives and bring them to justice.
The 11th Distinguished Service Award is presented to Assistant Inspector General Thomas F. McLaughlin for his distinguished 43-year career in federal law enforcement, 22 of which were with the department’s Office of the Inspector General (OIG). His tenure has been marked by many Investigations Division achievements, including the successful prosecution of department employees, contractors and civilians who betrayed the trust of the department and American people through their misconduct or criminal actions; the implementation of a diverse grant fraud program with department-wide impact; and the implementation of programs that improved the operations and safety of OIG and department personnel.
The 12th Distinguished Service Award is presented to the CrimeSolutions.gov Development Team for its leadership in creating and launching the premier online resource for information about evidence-based programs and practices in criminal justice, juvenile justice and crime victim services. The team led the review and synthesis of findings from more than three decades of rigorous social science research and program evaluations, and created a user-friendly interface that turns highly technical information into highly practical information. Designed for practitioners, CrimeSolutions.gov increases effectiveness by encouraging replication of successful approaches, and it saves resources by reducing the time and expertise required to access research findings.
Award recipients include, from the Office of Justice Programs, Senior Policy Advisor Phelan A. Wyrick; Research Coordinator Brecht C. Donoghue; and from the Office of Juvenile Justice and Delinquency Prevention, Program Manager Jennifer Tyson Abell.
The 13th Distinguished Service Award is presented to team members for their involvement in two sensitive investigations ordered by two different Attorneys General. In January 2007, Attorney General Michael Mukasey asked Assistant U.S. Attorney John Durham to lead a team that would investigate the destruction of interrogation videotapes by the CIA. Assistant U.S. Attorney Durham assembled the team and began the investigation. Then, in August 2009, Attorney General Holder expanded Assistant U.S. Attorney Durham’s mandate to include a preliminary review of the treatment of detainees held at overseas locations. This second request resulted in the review of 101 detainee matters that led to two full criminal investigations. In order to conduct the investigations, the team had to review significant amounts of information, much of which was classified, and conduct many interviews in the United States and at overseas locations.
Award recipients include, from the District of Connecticut, Assistant U.S. Attorney John H. Durham and Information Technology Specialist Jane K. Royce; from the Counsel to the U.S. Attorney’s Anti-Terrorism Unit, Chief James B. Farmer; from the District of Massachusetts’s Strike Force Unit, Chief James D. Herbert; from the District of Massachusetts’s Criminal Division, Deputy Chief Cynthia A. Young; from the Eastern District of Wisconsin, Senior Litigation Counsel Francis D. Schmitz; from the Executive Office for U.S. Attorneys, Paralegal Specialist Joyce P. Moak; from the Criminal Division’s Fraud Section, Trial Attorney Edward T. Kang; from the FBI’s Salt Lake City Division, Special Agent in Charge David J. Johnson; from the FBI’s Washington Field Office, Supervisory Special Agents Kristen M. Beutler, Sean L. Kaul and Special Agents Karen A. Cody, M.L. Miller and C. Ormerod; from the San Francisco Field Office, Special Agent in Charge Stephanie Douglas; from the FBI’s Kansas City Field Office, Special Agent Kevin Caudle; and from the FBI’s Inspection Division, Management and Program Analyst Linda L. Hovatter.
The 14th and final Distinguished Service Award is presented to team members for their exceptional contributions in connection with the landmark investigation and prosecution of former Congressman William J. Jefferson and his co-conspirators. The investigation, which commenced in March 2005 while Jefferson was a sitting member of the U.S. House of Representatives, culminated in the prosecution and conviction of Jefferson for bribery, honest services fraud, conspiracy, money laundering and Racketeer Influenced and Corrupt Organizations (RICO) violations. In November 2009, Jefferson was sentenced to serve 13 years in prison, the longest sentence ever imposed for a current or former member of Congress.
Award recipients include, from the Eastern District of Virginia, Assistant U.S. Attorneys Jack Hanly, Rebeca Bellows and Mark D. Lytle; Paralegal Crystal Griego; and Technical Assistant Jermaine M. Ragin; from the District of Columbia’s Appellate Division, Chief Roy W. McLeese III; from the District of Columbia, Assistant U.S. Attorneys Michael K. Atkinson and David B. Goodhand; from the Criminal Division’s Fraud Section, Deputy Chief Charles E. Duross and Trial Attorney Amanda Aikman (former); from the Criminal Division’s Appellate Section, Trial Attorney Stephan E. Oestreicher Jr.; from the FBI, Special Agents John Longmire and Timothy R. Thibault; from the FBI’s Washington Field Office, Special Agents Edward S. Cooper (retired) and Daniel T. Gallagher (retired).
The Attorney General’s Award for Excellence in Law Enforcement recognizes outstanding professional achievements by law enforcement officers of the Department of Justice. Two Excellence in Law Enforcement Awards are presented this year.
The first Attorney General’s Award for Excellence in Law Enforcement is presented to the investigative team responsible for the successful prosecution of eight Fuerzas Armadas Revolucionarias de Colombia (FARC) leaders and members, sentenced to prison terms ranging from 10 to 18 years. Beginning in 2004, this team investigated five leaders of the FARC, a designated foreign terrorist organization dedicated to the violent overthrow of the Government of Colombia. In a related effort in 2010, which focused on leaders and members of the particularly dangerous FARC 57th Front, the U.S. Attorney’s Office for the Southern District of New York, the Drug Enforcement Administration (DEA) and the FBI worked together to identify and gather evidence on the members, including those involved in the kidnapping of a U.S. citizen who was ultimately released. In total, the FARC investigations resulted in charges against 60 individuals, two jury trials, 11 convictions and sentences, with sentences ranging from 10 to 29 years in prison.
Award recipients include, from the FBI’s Jacksonville, Fla., Field Office, Special Agent Charles M. Cain; from the FBI’s Miami Field Office, Special Agents Manuel Ortega (retired) and C.M. Monero (retired); from the FBI’s Defense Intelligence Analysis Program, Intelligence Analyst Christopher J. Wright Jr.; from the DEA’s Mérida, Mexico, Resident Office, Resident Agent in Charge Justin L. Peterson; from the DEA’s Atlanta Field Office, Special Agent Dustin T. Harmon; from the DEA’s Houston Field Division, Group Supervisor Lee M. Nash; from the DEA’s Washington Field Division, Special Agent Nestor A. Laserna; and from the DEA’s New York Field Division, Special Agents Daniel J. Dyer, Christopher H. Miller and Intelligence Research Specialist Francisco Garrido.
The second Attorney General’s Award for Excellence in Law Enforcement is presented to members of the Operation Delta Blues Task Force for its dedicated service and investigations into long-standing corruption, violent gang and drug activities, illegal weapons offenses and illegal gambling in the Arkansas Delta. After conducting an undercover operation, seven Title III wire intercepts and eight controlled drug trafficking transactions with law enforcement officers who provided protection in exchange for cash, the Delta Blues team indicted more than 70 subjects, five of whom were law enforcement officers. The culmination of this four-year investigation resulted in the largest law enforcement operation ever conducted in Arkansas and one of the largest in FBI history.
Award recipients include, from the FBI’s Little Rock Field Office, Supervisory Special Agents Kimberly F. Brunell and Jeffery E. Peterson; Special Agents Carrie B. Land, John C. Marsh, H.L. Seale Jr. and James P. Woodie; Photographer Noland R. McCoy; and Staff Operations Specialist Yvonne M. Maier; from the Eastern District of Arkansas, Assistant U.S. Attorney Julie E. Peters; from the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Little Rock Field Office, Senior Special Agent W. Glen Jordan; from the Arkansas State Police, Special Agent Phillip L. Hydron Jr. and Major Cleveland Earl Barfield.
The Attorney General’s Award tor Exceptional Service in Indian Country recognizes extraordinary efforts by department employees that demonstrate the department’s commitment to fight crime in Indian Country. This year’s award is presented to Arvo Q. Mikkanen, the Assistant U.S. Attorney and Tribal Liaison for the Western District of Oklahoma. Mr. Mikkanen’s development of the Indian Country Misdemeanor Docket has successfully addressed a substantial gap in the criminal justice system on Oklahoma’s tribal lands, providing a model for other districts to emulate.
The Attorney General’s Award for Excellence in Information Technology recognizes outstanding achievements in applying information technology to improve operations and productivity, reduce or avoid costs, and solve problems. This year’s award is presented to five individuals for their outstanding leadership, unparalleled technology innovation and superior program management of the Next Generation Digital Collection System – 5000 (DCS-5000) Program. As a result of the team’s dedication to the success of this program, the DCS-5000 has saved more than $35 million, is ahead of schedule, and has provided innovative technical solutions to improve the efficiency, productivity and effectiveness of the FBI’s Case Agents, Intelligence Analysts, Linguists and System Administrators.
Award recipients include, from the FBI’s Operational Technology Division, Supervisory Special Agent William T. Via; Supervisory Electronics Engineer Roger T. Campbell Supervisory Engineering Technician John A. Herbert ; and Electronics Engineers Charles J. Austin and Kristin L. Moxley.
The Attorney General’s Award for Excellence in Furthering the Interests of U.S. National Security recognizes outstanding achievements and contributions in protecting U.S. national security. Two Excellence in Furthering the Interests of U.S. National Security Awards are presented this year.
The first Excellence in Furthering the Interests of U.S. National Security Award is presented to the investigative and prosecution team of the attempted bombing of Northwest Flight 253 over Detroit on Dec. 25, 2009, for its outstanding work in obtaining intelligence useful to the United States and its foreign intelligence partners. Over the course of this two-year high-profile investigation, the team effectively balanced an intelligence gathering operation with a successful prosecution. The team’s cooperation resulted in a significant conviction against Al Qa eda operative Umar Farouk Abdulmutal lab who was sentenced on Feb. 6, 2012, to the maximum penalty of four consecutive life-sentences plus 30 years in federal prison.
Award recipients include, from the Eastern District of Michigan, Assistant U.S. Attorneys Cathleen M. Corken, Michael C. Martin and Jonathan Tukel; Paralegal Darlene L. Secord; from the FBI’s Detroit Field Office, Special Agents Gary A. Francis and Theodore J. Peissig; Supervisory Special Agent Michael F. Connelly; Intelligence Analysts Theodore R. Begeman, John A. Gates and Debra George-Merritt; from the FBI’s Counterterrorism Division, Supervisory Special Agent Gabriel K. Poling; Staff Operations Specialist Melissa Plowman; Intelligence Analyst Michael P. Machtinger; and from the FBI’s Laboratory Division, Physical Scientist Michael G. Leone and Chemist Robert F. Mothershead II
The second Excellence in Furthering the Interests of U.S. National Security Award is presented to the investigative and prosecution team whose exemplary work on the Boyd terrorism case – in which the defendants were recruiting, planning, and preparing to engage in violent attacks overseas – resulted in the conviction of seven defendants on various terrorism violations, including conspiracy to provide material support to terrorists and conspiracy to murder persons overseas.
Award recipients include, from the Eastern District of North Carolina, Assistant U.S. Attorneys Jason M. Kellhofer, John S. Bowler and Barbara D. Kocher; Legal Assistant Stacey J. Taylor; Victim Witness Coordinator Michelle D. Scott; Intelligence Specialist Sarah H. Foster; Information Technology Specialist Jacqueline M. Nobling; from the FBI’s Charlotte Field Office, Supervisory Special Agent Maria Jocys; Special Agents Paul C. Minella, Michael A. Greer, William J. Logallo and Jason R. Maslow; Intelligence Analyst Kristie N. Cranford; from the FBI’s Training Division, Supervisory Special Agent Gregory T. Alznauer; from the National Security Division, Attorney-Advisors Michael E. Eaton and David Farnham; Unit Chief Alexandra Doumas; from the U.S. Department of Defense’s (DOD) Defense Criminal Investigative Service, Special Agent Heather Z. Ferris; Raleigh Police Department, Detectives Robert C. Powell IV; and from the Durham Police Department, Task Force Officer Charles D. Burroughs.
The Attorney General’s Award for Equal Employment Opportunity is the department’s highest award for performance in support of the Equal Employment Opportunity program. This year’s award is presented to the team that represents the core membership of the department’s Diversity Council Executive Group. These talented individuals are responsible for implementing the Attorney General’s Diversity Initiative in addition to their outstanding work with the department’s Diversity Council. Most notable among its accomplishments, the team: established guiding principles for developing Component Operational Diversity Management Plans; reviewed 130 Component Diversity Management Plans; coordinated the first department-wide diversity training and subsequent relevant lectures; developed the Diversity Intranet site; helped to develop a more strategic approach to increasing representation of persons with disabilities; and facilitated numerous informal discussions with components to discuss effective diversity management practices.
Award recipients include, from Office of the Associate Attorney General, Deputy Associate Attorney General for Diversity Management Richard L. Parker and Special Counsel for Disability Resources Allison Nichol; from the Executive Office for U.S. Attorneys’ Office of the Director, Deputy Director for Legal Management Suzanne L. Bell;Equal Employment Opportunity Staff, Assistant Director Jason S. Osborne;; from the Justice Management Division’s Equal Employment Opportunity Staff, Director Richard A. Toscano Jr. from the Justice Management Division’s Office of Attorney Recruitment and Management, Assistant Director Jeanne Svikhart (former); and Deputy Director for Legal Recruitment and Outreach Jamila W. Frone; from the BOP’s Office of General Counsel, Deputy General Counsel Kenneth Hyle; and from the Executive Office for U.S. Trustees, Associate Director Jeffrey M. Miller (retired).
The Attorney General’s Award for Excellence in Legal Support recognizes outstanding achievements in the field of legal support to attorneys by paralegal specialists and other legal assistants.
In the Paralegal Category, this year’s award for Excellence in Legal Support is presented to Jamie A. Smith , Paralegal Specialist for the Civil Division’s Office of Immigration Litigation’s (OIL) District Court Section. Her performance during the first instance of using Foreign Intelligence Surveillance Act intercepts as evidence in a federal civil trial was exemplary. Ms. Smith’s dedication and hard work is always of the highest quality and she continuously looks for ways to improve her already superior performance.
In the Legal Support Category, this year’s award for Excellence in Legal Support is presented to Evelyn Buggs, Legal Administrative Specialist for the Office of the Solicitor General. Ms. Buggs, who works in the front office of the Office of the Solicitor General, exemplifies excellence in legal support. In her more than 20 years of service, she has consistently displayed exceptional competence and professionalism. Through her leadership, she has helped to foster and sustain a highly productive support team.
The Attorney General’s Award for Excellence in Administrative Support recognizes outstanding performance in administrative or managerial support by an administrative employee or secretary. Two Excellence in Administrative Support Awards are presented this year.
In the Administrative Category, this year’s award for Excellence in Administrative Support is presented to Lorraine L. Gonzales, Supervisory Administrative Specialist for the Environment and Natural Resources Division’s Environmental Enforcement Section. Ms. Gonzales was instrumental in orchestrating communications across the many agencies involved in the Cosco Busan oil spill litigation, and provided invaluable support on the creation and management of the case database, comprised of approximately one million documents critical to the development of the case.
In the Secretarial Category, this year’s award for Excellence in Administrative Support is presented to Sherrie M. McIntosh, Management and Program Analyst for the USMS’s Tactical Operations Division. Ms. McIntosh is honored for her role as the sole administrative employee overseeing the USMS Tactical Operations Division’s Strategic National Stockpile Security Operations program. Her professionalism and positive demeanor fosters relationships within and outside of the Marshal’s Service, an especially vital asset in conducting the day-to-day business of the National Stockpile Security Operations program.
The Claudia J. Flynn Award for Professional Responsibility recognizes a department attorney who has made significant contributions in the area of professional responsibility by successfully handling a sensitive and challenging professional responsibility issue in an exemplary fashion and/or leading efforts to ensure that department attorneys carry out their duties in accordance with the rules of professional conduct. This year’s award is presented to Barbara Kammerman, Senior Attorney for the Professional Responsibility Advisory Office (PRAO). Ms. Kammerman alone has personally responded to more than 2,700 of the approximately 19,400 professional responsibility inquiries the office has received from attorneys and has managed or assisted PRAO attorneys in analyzing thousands more.
The Attorney General’s Award for Outstanding Service in Freedom of Information Act Administration recognizes exceptional dedication and effort to the implementation of the Freedom of Information Act (FOIA). In Fiscal Year 2011, the National Security Division’s FOIA Declassification and Prepublications Review Unit received 289 FOIA requests and successfully processed and closed 305 requests, handling and closing all of the new requests received and several from the backlog, including a number of older cases that were complex and challenging. The team also defended 13 lawsuits, including some seeking records related to highly sensitive intelligence collection programs that must remain classified in the interest of national security.
Award recipients include, from the National Security Division, FOIA Director Mark A. Bradley; Declassification Specialist Theresa Crosland; FOIA and Privacy Specialists Lani Gleaves, Patricia R. Matthews and Tiffanie C. Tinsley; FOIA Initiatives Coordinator Arnetta Mallory; Counsel Susan L. Kim; and from the Law and Policy Office, Supervisory Records Management Specialist Kevin G. Tiernan.
The Attorney General’s Award for Fraud Prevention recognizes exceptional dedication and effort to prevent, investigate and prosecute fraud, white-collar crimes and official corruption. This year’s award is presented to the investigation and prosecution team responsible for the case involving American Therapeutic Corporation (ATC), one of the largest healthcare fraud cases in the United States. The case involved the submission of more than $205 million in fraudulent claims to the Medicare program by ATC. One ATC owner who pleaded guilty was sentenced to serve 50 years in prison, and two other ATC owners were sentenced to serve 35 years in prison.
Award recipients include, from the FBI’s Miami Field Office, Supervisory Special Agent Randall C. Culp; Special Agents Patrick R. Koeth and Ellen S. Thomas; from the Criminal Division, Trial Attorney Jennifer Saulino; Fraud Section Assistant Chief Benjamin Singer; Assistant Special Agent in Charge Omar Pérez Aybar; and from the U.S. Department of Health and Human Services Office of Inspector General, Special Agent Daniel Arce.
The Attorney General’s Award for Outstanding Contributions to Community Partnerships for Public Safety recognizes outstanding achievement in the development and support of community partnerships designed to address public safety within a community. The award recognizes the significant contributions of citizens and organizations that have assisted the department in the accomplishment of these programs.
This year’s Outstanding Contribution to Community Partnerships for Public Safety award is presented to the team who, through public and private partnerships, has created the nationally-recognized Internet Crimes Against Children Task Force and Innocence Lost Task Force. This team has worked tirelessly with federal and local officials as well as community members to fight child exploitation, Internet crimes against children and child sex trafficking. Additionally, the team is working closely with victims and their non-government advocates to address the unique challenges presented by child prostitution and its impact on the community.
Award recipients include, from the Southern District of California, Assistant U.S. Attorney Alessandra P. Serano; from the FBI’s San Diego Field Office, Special Agent Carla J. Croft; from the Department of Homeland Security’s Homeland Security Investigations, Special Agent Sonny L. Kilmer; from the San Diego Police Department. Detective Chappie Hunter and Sergeant Charles Arnold; from the San Diego County Sheriff’s Department, Deputy George Crysler; and from the Oceanside, Calif., Police Department, Detective Jack Reed.
The Attorney General’s Award for Outstanding Contributions by a New Employee recognizes exceptional performance and notable accomplishments towards the department’s mission by an employee with fewer than five years of federal career service. Four Outstanding Contributions by a New Employee Awards are presented this year.
The first Contribution by a New Employee Award is presented to Fara T. Gold, Trial Attorney for Civil Rights Division’s Criminal Section. During her three years with the Criminal Section of the Civil Rights Division, Ms. Gold has prosecuted and convicted multiple defendants in some of the section’s most difficult cases, including United States v. Beebe et al., the first case ever brought by the department under the Matthew Shepard-James Byrd Hate Crimes Prevention Act.
The second Contribution by a New Employee Award is presented to Jack S. Schmidt, Assistant U.S. Attorney for the District of Alaska. Mr. Schmidt has excelled with a small staff while having one of the highest caseloads of any attorney in the district. Mr. Schmidt also led one of the largest Organized Crime Drug Enforcement Task Force investigations in the office, leading to the prosecution of 34 defendants to date.
The third Contribution by a New Employee Award is presented to Anita M. Singh Deputy Chief of Staff of the National Security Division, who previously served in this role on detail from the Criminal Division. Ms. Singh is recognized for her performance and support of the department’s highest priority of combating terrorism and other threats to national security, including emerging cyber-based threats. Most recently, she assumed primary responsibility for cyber policy and legislative work at the Criminal Division, led interagency cybersecurity policy development at the White House and has helped lead broad efforts to combat cyber threats to national security.
The fourth and final Contribution by a New Employee Award is presented to Jason Bergmann, Trial Attorney for the Tax Division’s Court of Federal Claims Section. In less than five years with the federal government, Mr. Bergmann has demonstrated extraordinary skill and achieved outstanding results in representing the United States in tax matters before the Court of Federal Claims and federal district courts. A superb advocate, he has masterfully handled some of the Tax Division’s most difficult cases.
The John Marshall Awards are the Department of Justice’s highest awards offered to attorneys, for contributions and excellence in specialized areas of legal performance. Twelve awards in nine categories are presented this year.
The first John Marshall Award for Trial of Litigation is presented to Edward K. Chung, Trial Attorney for the Civil Rights Division’s Criminal Section, and Kyra E. Jenner, Assistant U.S. Attorney for the Western District of Arkansas. This team is honored for its outstanding investigation and prosecution of United States v. Maybee et al., culminating in the conviction of two defendants for a racially motivated attack that resulted in life-threatening and serious injuries to five victims. This highly significant prosecution resulted in the nation’s first convictions under the Matthew Shephard and James Byrd Hate Crimes Prevention Act.
The second John Marshall Award for Trial of Litigation is presented to Scott H. Anderson, Senior Litigation Counsel for the District of Puerto Rico. Mr. Anderson is recognized for outstanding performance in the litigation of United States v. Dennis Muniz-Tirado et al., wherein the defendants were utilizing their positions as law enforcement officers to incriminate citizens for crimes that they did not commit, routinely violating both individuals’ civil rights and the narcotics laws of the United States. Nine of the 10 defendants who were eventually indicted were members of the Police of Puerto Rico’s Mayaguez Drugs/Narcotics/Vice Unit.
The first John Marshall Award for Participation in Litigation is presented to the team whose dedication and skill in investigating, litigation and negotiating led to a $335 million settlement in the groundbreaking lending discrimination case of United States v. Countrywide Financial Corporation. This lawsuit is the largest case of pricing discrimination in mortgage lending ever brought by the department, and is the first fair lending case ever by the department to include a claim that Hispanic and African-American borrowers were discriminated against because they were systematically placed in subprime loans while similarly-qualified white borrowers were placed in prime loans.
Award recipients include, from the Civil Rights Division’s Office of the Assistant Attorney General, Deputy Assistant Attorney General Victoria H. Schultz and Special Counsel for Fair Lending Eric Halperin; from the Civil Rights Division’s Housing and Civil Enforcement Section, Chief Steven H. Rosenbaum; Principal Deputy Chief Donna M. Murphy; Trial Attorneys Burtis M. Dougherty, Daniel P. Mosteller and Patricia L. O’Beirne.
The second John Marshall Award for Participation in Litigation is presented to the Stonehill trial and appellate litigation team for 12 years of exceptional work in successfully defending a multi-million dollar tax judgment obtained in 1980 against the taxpayers’ last-ditch collateral attack. Defense of the case required the team members to master a 40-year record spanning tens of thousands of pages generated in hundreds of legal proceedings.
Award recipients include, from the Tax Division’s Western Civil Trial Section, Trial Attorney Charles M. Duffy; from the Criminal Appeals and Tax Enforcement Policy Section, Chief Frank P. Cihlar; and from the Appellate Section, Trial Attorneys Bethany B. Hauser and Randolph L. Hutter.
The first John Marshall Award for Support of Litigation is presented to Christopher B. Synsvoll, Supervisory Attorney for the Federal Correctional Complex - Florence, Colorado’s Consolidated Legal Center. Mr. Synsvoll serves as the legal and technical advisor on all legal aspects of correctional administration to the Federal BOP institutions within the District of Colorado. His expertise on restrictive conditions of confinement is sought after by staff from the Criminal Division, U.S. Attorney’s Offices, the Federal Death Penalty Resource Counsel, the Administrative Office of the U.S. Courts and in capital prosecutions.
The second John Marshall Award for Support of Litigation is presented to Bradley R. O’Brien, Senior Attorney for the Environment and Natural Resources Division’s Environmental Enforcement Section, and R. Michael Underhill, Attorney in Charge for the Civil Division’s Aviation and Admiralty Section. The Cosco Busan Litigation Team is honored for its outstanding work and filing, within three weeks of the incident, an in personam and in rem complaint against the owners and operators of the vessel Cosco Busan that collided with the San Francisco Bay Bridge. The incident caused a rupture in the vessel’s fuel tank and the discharge of bunker oil into the San Francisco Bay and ultimately the Pacific Ocean.
The John Marshall Award for Handling of Appeals is presented to Howard S. Scher, Senior Counsel for the Civil Division’s Appellate Staff. Mr. Scher is the Civil Division’s leading expert on federal sector labor and management issues and has secured victories for numerous agencies on issues of great importance to the management of those agencies. He has also made key contributions to the development of the law shielding federal employees, including high-ranking officials, from personal liability for actions taken in the scope of their responsibilities.
T he John Marshall Award for Providing Legal Advice is presented to John J. Powers III, Assistant Chief for the Antitrust Division’s Appellate Section. For more than 30 years, Mr. Powers has supervised almost all of the appellate litigation arising from the criminal antitrust enforcement program. His strategic judgment and unrivaled knowledge of criminal antitrust law makes him a respected legal advisor and ensures that the division receives outstanding representation in the appellate courts.
The John Marshall Award for Preparation or Handling of Legislation is presented to Claudia Burke and Steven J. Gillingham, Assistant Directors from the Civil Division’s National Courts Section. Ms. Burke and Mr. Gillingham assist in the management of one of the largest offices in the Civil Division, an office that engages in trial and appellate litigation, spanning a wide range of legal areas. This team is recognized for its innovative and sustained role in ensuring that regulations and legislation are clear, consistent with established principles of law and do not inadvertently and adversely affect the interests of the United States in litigation – all the while being mindful of executive branch policy goals.
The John Marshall Award for Asset Forfeiture is presented to Linda M. Samuel, Deputy Chief, International Unit, for the Criminal Division’s Asset Forfeiture and Money Laundering Section. Her work for the past two decades in cross-border cooperation in forfeiture and money laundering matters has led to the recovery of tens of millions of dollars and the development of international best practices and policy in international forfeiture. Additionally, she has been instrumental in developing the laws and litigating cases brought by the department to execute incoming requests from foreign jurisdictions for the registration and enforcement of foreign restraining orders and forfeiture judgments.
The John Marshall Award for Alternative Dispute Resolution is presented to Douglas K. Mickle, Senior Trial Counsel for Civil Division’s National Courts Section. Mr. Mickle is recognized for his outstanding professional achievement in resolving the disputes of nearly 2,200 combat veterans who challenged how the military services applied disability-rating guidance when rating their Post-Traumatic Stress Disorder condition. Responding to five separate lawsuits, Mr. Mickle spearheaded the drive to resolve these cases and brokered a framework that achieved results consistent with the results that the courts or military review boards would have reached if each case were adjudicated on the merits in those forums.
The John Marshall Award for Interagency Cooperation in Support of Litigation is presented to a team of Federal Deposit Insurance Corporation attorneys for its outstanding work in assisting Civil Division attorneys litigate nearly 120 cases arising out of Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA) enactment. The litigation involved approximately 50 trials, more than 128 million pages of documents produced by the federal government during discovery, 475 expert reports and more than 2,500 depositions.
Award recipients include, from the Federal Deposit Insurance Corporation’s Office of the General Counsel, Acting General Counsel Richard J. Osterman Jr., Deputy General Counsel (retired) Jack D. Smith; from the Division of Administration, Senior Management Analyst Robert H. Krause; from the Legal Division, Senior Counsel (former) Claire L. McGuire; from the Finance Division, Director Craig R. Jarvill and Corporate Manager J. Craig Sweeney; from the Commercial Litigation Unit, Counsels Susan Kantor Bank, Leslie Ann Conover and Wendy B. Kloner; from the Office of the Inspector General, Counsel to the Inspector General John A. Davidovich; from the Legal Information Technology Unit, Senior Counsels Thomas J. Feeney and H. Andrea Gribble; from the Appellate Litigation Unit, Counsel Jerome A. Madden; from the Corporate Litigation Unit, Counsel Thomas L. Holzman; and from the Division of Resolutions and Receiverships, Director Bret D. Edwards.
Tuesday 16 October 2012
Taiwan Auto Lights Manufacturer and Its California Distributor Plead Guilty in Price-Fixing ConspiracyRead the Press Release
WASHINGTON – A Taiwan aftermarket auto lights manufacturer and its U.S. distributor pleaded guilty to an indictment charging them with participating in a seven-year, international conspiracy to fix the prices of aftermarket auto lights, and were sentenced today in U.S. District Court for the Northern District of California, the Department of Justice announced. Aftermarket auto lights are incorporated into an automobile after its original sale, often as repairs following a collision or as accessories and upgrades.
Tainan County, Taiwan-based Eagle Eyes Traffic Industrial Co. Ltd., and its U.S. subsidiary, Chino, Calif.-based E-Lite Automotive Inc., were sentenced by U.S. District Judge Richard Seeborg to pay a total of $5 million in criminal fines.
According to a one-count superseding indictment filed in U.S. District Court for the Northern District of California in San Francisco, on Nov. 30, 2011, Eagle Eyes and E-Lite conspired with others to suppress and eliminate competition by fixing the prices of aftermarket auto lights. Eagle Eyes participated in the conspiracy from about July 2001 until about September 2008, and E-Lite participated from about March 2006 until about September 2008.
“The conspirators engaged in an international price-fixing scheme that undermined competition in the aftermarket auto lights industry,” said Joseph Wayland, Acting Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “As a result of the division’s vigorous enforcement efforts, four corporations and five executives have been charged.”
According to court documents, the conspiracy was carried out by the two highest-ranking officers of Eagle Eyes—its chairman, Yu-Chu Lin, and vice chairman, Homy Hong-Ming Hsu— who were both charged along with Eagle Eyes and E-Lite in the superseding indictment. The executives met with other co-conspirators and agreed to charge prices of aftermarket auto lights according to jointly-determined formulas. The conspirators issued price announcements to customers in accordance with the jointly-determined price structure, and collected and exchanged information on prices for the purpose of monitoring and enforcing adherence to the conspiracy. The conspirators also took steps to conceal their actions throughout the duration of the conspiracy.
In addition to today’s pleas, two other corporations have also pleaded guilty. On Oct. 4, 2011, Sabry Lee pleaded guilty and was sentenced to pay a $200,000 criminal fine. On Nov. 15, 2011, Maxzone pleaded guilty and was sentenced to pay a $43 million criminal fine.
Chairman Lin, who resides in Taiwan, remains a fugitive. Vice Chairman Hsu, who was arrested at Los Angeles International Airport over a year ago, pleaded guilty on Sept. 25, 2012. Hsu is scheduled to be sentenced on Jan. 22, 2013.
In addition to Homy Hsu, three individuals have also pleaded guilty. Shiu-Min Hsu, the former chairman of Depo Auto Parts Industrial Co. Ltd., a Taiwan manufacturer of aftermarket auto lights, pleaded guilty on March 20, 2012, and is scheduled to be sentenced on Jan. 8, 2013. Chien Chung Chen, aka Andrew Chen, the former executive vice president of Sabry Lee (U.S.A.) Inc., a U.S. distributor of aftermarket auto lights, pleaded guilty on June 7, 2011. He is scheduled to be sentenced on Jan. 15, 2013. Polo Shu-Sheng Hsu, the highest-ranking officer of Maxzone Vehicle Lighting Corp., another U.S. distributor of aftermarket auto lights, pleaded guilty on March 29, 2011, served his sentence of 180 days in prison and paid a $25,000 criminal fine.Eagle Eyes and E-Lite are charged with violating the Sherman Act, which carries a maximum penalty of a $100 million fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims, if either of those amounts is greater than the statutory maximum fine.
This case is part of an investigation being conducted by the Department of Justice Antitrust Division’s San Francisco Office and the FBI in San Francisco. Anyone with information concerning illegal or anticompetitive conduct in the aftermarket auto lights industry is urged to call the Antitrust Division’s San Francisco Field Office at 415-436-6660 or visit www.justice.gov/atr/contact/newcase.htm .
Protecting the Right to Vote and Prosecuting Ballot FraudRead the Press Release
In anticipation of the upcoming election, the Justice Department today provided information about its efforts, through the Civil Rights and Criminal Divisions, to ensure that all qualified voters have the opportunity to cast their ballots and have their votes counted free of discrimination, intimidation or fraud in the election process .
Civil Rights Division:
The Civil Rights Division is responsible for ensuring compliance with the civil provisions of federal laws that protect the right to vote, and with federal criminal laws prohibiting discriminatory interference with that right.
The Civil Rights Division’s Voting Section enforces civil provisions of federal laws that protect the right to vote including: the Voting Rights Act; the National Voter Registration Act; the Uniformed and Overseas Citizens Absentee Voting Act; and the Help America Vote Act. Among other things, these laws prohibit discrimination based on race or membership in a minority language group; prohibit intimidation of voters; provide that voters who need assistance in voting because of disability or illiteracy can obtain assistance from a person of their choice; require minority language election materials and assistance in certain jurisdictions; provide for accessible election machines for voters with disabilities; require provisional ballots for voters who assert they are eligible but whose names do not appear on poll books; provide for absentee ballots for service members, their family members and U.S. citizens living abroad; and require states to ensure that citizens can register at drivers’ license offices, public assistance offices , other state agencies and through the mail; and include requirements regarding maintaining voter registration lists.
The Civil Rights Division’s Criminal Section enforces federal criminal statutes that prohibit voter intimidation and suppression based on race, color, national origin or religion.
As it has in the past, on Election Day, Nov. 6, 2012, the Civil Rights Division will implement a comprehensive program to help ensure ballot access that will include the following:
- Shortly before the election, the Civil Rights Division will announce which jurisdictions will have federal personnel as election monitors and observers at polling places.
- Civil Rights Division attorneys in both the Voting and Criminal Sections in Washington, D.C., will be ready to receive election-related complaints of potential violations relating to any of the statutes the Civil Rights Division enforces. Attorneys in the division will take appropriate action and will consult and coordinate with local U.S. Attorneys’ Offices and with other entities within the Department of Justice concerning these complaints before, during, and after Election Day, as appropriate.
Civil Rights Division staff will be available by phone to receive complaints related to ballot access (1-800-253-3931 toll free or 202-307-2767) or by TTY (1-877-267-8971). In addition, individuals may also report complaints, problems, or concerns related to voting by fax to 202-307-3961, by email to [email protected] and, closer to Election Day, by complaint forms that may be submitted through a link on the department’s website, at www.justice.gov/crt/about/vot/ .
Complaints related to violence or threats of violence at a polling place should, in the first instance, always be reported to local police authorities by calling 911.
Criminal Division and the Department’s 94 U.S. Attorneys’ Offices:
The Department’s Criminal Division oversees the enforcement of federal laws that criminalize certain election fraud and vindicate the integrity of the federal election process.
The Criminal Division’s Public Integrity Section and the Department’s 94 U.S. Attorneys’ Offices are responsible for enforcing the federal criminal laws that prohibit various forms of election fraud, such as vote buying, multiple voting, submission of fraudulent ballots or registrations, destruction of ballots or registrations, alteration of votes and malfeasance by election officials . The Criminal Division is also responsible for enforcing federal criminal law prohibiting voter intimidation that does not involve a basis in race , color , national origin or religion (as noted above, voter intimidation that has a basis in race, color, national origin or religion is addressed by the Civil Rights Division).
The department encourages each U.S. Attorney’s Office to communicate with state election officials before the federal general elections regarding the handling of election-related matters in their respective districts. In addition, the department provides annual training for the Assistant U.S. Attorneys who serve as district election officers (DEOs) in their respective districts. DEOs are responsible for overseeing potential election-crime matters in their districts , and for coordinating with the department’s election-crime experts in Washington, D.C.
On Nov. 6, 2012, the U.S. Attorneys’ Offices will work with specially trained Federal Bureau of Investigation personnel in each district to ensure that complaints from the public involving possible voter fraud are handled appropriately . Specifically:
- Federal prosecutors at the Public Integrity Section, the DEOs in U.S. Attorneys’ Offices, FBI officials at headquarters in Washington, D.C., and FBI Special Agents serving as Election Crime Coordinators in the FBI’s 56 field offices will be on duty while polls are open, to receive complaints from the public.
- Election fraud or intimidation complaints should first be directed to the local U.S. Attorney’s Office or the local FBI office. A list of U.S. Attorneys’ Offices and their telephone numbers can be found at www.justice.gov/usao/offices/index.html , and a list of FBI offices and accompanying telephone numbers can be found at the “Contact Us” button at http://www.fbi.gov . Again, however, complaints related to violence or threats of violence at a polling place should, in the first instance, be reported to local police authorities by calling 911.
- Election fraud or intimidation complaints may also be directed to the Public Integrity Section (202-514-1412). Public Integrity Section prosecutors are available to consult and coordinate with the U.S. Attorneys’ Offices and FBI regarding the handling of election-crime allegations.
Both protecting the right to vote and combating election fraud are essential to maintaining the confidence of all Americans in our democratic system of government. We encourage anyone who has information suggesting voting discrimination or ballot fraud to contact the appropriate authorities.
Ohio Insurance Salesman Sentenced to 37 Months in Prison for Tax EvasionRead the Press Release
A federal judge today sentenced William A. Herder of Richland County, Ohio, to 37 months in prison for tax crimes, the Justice Department and the Internal Revenue Service (IRS) announced. U.S. District Judge Sara Lioi also ordered Herder to pay restitution to the IRS. On May 21, 2012, an Akron, Ohio, jury convicted Herder on all counts of an indictment that charged Herder with one count of tax evasion, one count of corruptly endeavoring to obstruct the administration of the Internal Revenue laws and five counts of willful failure to file tax returns.
According to the evidence at trial, Herder sold insurance for Aflac Inc., a nationwide supplemental insurance provider, from an office in Mansfield, Ohio. Despite earning substantial income from insurance sales and receiving warning notices and letters from the IRS about his obligations under the tax laws, Herder failed to file timely and valid tax returns for the years 2000-2009. For the year 2000, Herder filed a tax return on which he falsely claimed that he had not earned any income. Subsequently, Herder failed to file any tax returns for the 2001-2009 tax years.
The trial evidence also established that in addition to failing to file tax returns and pay taxes, Herder attempted to conceal his assets from the IRS. In 2003, Herder transferred title to his house to a bogus foundation he established in Utah called “The Mentor Foundation.” Herder also cashed out an Individual Retirement Account and a life insurance policy, converted large amounts of cash to silver coins, and paid personal and business expenses with cash and money orders, all in an effort to prevent the IRS from collecting his unpaid taxes.
According to trial evidence, Herder submitted numerous obstructive letters and documents to the IRS in an effort to prevent the IRS from assessing and collecting his taxes. In these letters, Herder falsely claimed, among other things, that the tax laws were not applicable to him. Herder sent similar letters to the companies for whom he sold insurance and to his credit union, all designed to prevent these companies from complying with IRS levies. Herder obtained these obstructive materials from several sources, including Joseph Flickinger, who was previously convicted and sentenced for a tax fraud conspiracy and later enjoined from preparing tax returns for others.
Herder has remained in custody since the trial.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, thanked special agents of IRS - Criminal Investigation, who provided valuable assistance in conducting the investigation, and Tax Division Trial Attorneys Melissa S. Siskind and Jeffrey McLellan, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax .
New York Landowner and New Jersey Waste Management Company Owner Convicted of Dumping Asbestos into Wetlands in Upstate New YorkRead the Press Release
The owner of a 28-acre piece of property on the Mohawk River and the owner of a New Jersey solid waste management company were found guilty by a federal jury in Utica, N.Y., today of charges that they conspired to defraud the United States and violate the Clean Water Act by illegally dumping thousands of tons of asbestos-contaminated construction debris on the property in upstate New York, announced Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division and Richard S. Hartunian, U.S. Attorney for the Northern District of New York.
“Mazza and his co-conspirators flouted numerous federal laws designed to protect Americans from exposure to toxic materials when they dumped asbestos contaminated waste into an area that included sensitive wetlands. They also committed fraud and lied to federal investigators in the process,” said Assistant Attorney General Moreno. “This conviction is a just result because these men have been held accountable for egregious environmental crimes that harm human health and the environment.”
“Today’s verdict was brought about through the tireless efforts of those state and federal investigative agencies that work every day to protect the environment and health of our citizens” said U.S. Attorney Hartunian. “We applaud them for their hard work.”
The defendants, Cross Nicastro, owner of the property in Frankfort, N.Y., along with Mazza & Sons Inc., and its owner, Dominick Mazza, were found guilty of conspiracy to defraud the United States, as well as violate the Clean Water Act and Superfund laws. In addition, Nicastro, Dominick Mazza and Mazza & Sons Inc. were convicted of violating the Superfund law’s requirement to report the release of toxic materials and obstructing justice. Dominick Mazza was also convicted of making false statements to EPA special agents.
According to evidence presented during the 10-day trial, the defendants engaged in the illegal dumping of thousands of tons of construction and demolition debris, much of which was contaminated with asbestos, at Nicastro’s property, which contained federally-regulated wetlands. The dumping occurred without a permit.
Evidence demonstrated that the defendants, along with co-conspirators, concealed the illegal dumping by fabricating a New York State Department of Environmental Conservation (DEC) permit and forging the name of a DEC official on the fraudulent permit. In addition, the evidence demonstrated that Mazza & Sons, Inc. obstructed justice by destroying and concealing documents responsive to a grand jury subpoena.
The conspiracy, substantive Superfund and false statement counts each carry a maximum penalty of five years in prison and a fine of either $250,000, twice the gross gain to the defendants, or twice the gross loss to a victim, whichever is determined to be greater. The obstruction of justice count carries a maximum penalty of 20 years in prison and similar fines.
This case was investigated by special agents from the EPA's Criminal Investigation Division and the Internal Revenue Service Criminal Investigation; criminal investigators with the New York State Environmental Conservation Police, Bureau of Environmental Crimes; investigators from the New Jersey State Police, Office of Business Integrity Unit; the New Jersey Department of Environmental Protection; and the Ohio Department of Environmental Protection. The case was prosecuted by Todd W. Gleason and Gary N. Donner of the Environmental Crimes Section of the U.S. Justice Department’s Environment and Natural Resources Division, and Assistant U.S. Attorney Craig A. Benedict, of the U.S. Attorney’s Office for the Northern District of New York.
Louisiana Man Sentenced in Virginia to 25 Years in Prison<br /> for Filming His Sexual Abuse of a Minor GirlRead the Press Release
WASHINGTON – A Louisiana man was sentenced to 25 years in prison this morning in Lynchburg, Va., federal court, after previously pleading guilty to recording his sexual abuse of a 14-year-old girl and related offenses, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and the U.S. Attorney for the Western District of Virginia Timothy J. Heaphy.
Gregory Thomas Miller, 57, of Deville, La., pleaded guilty on April 27, 2012, to a 10-count indictment charging him with seven counts of production of child pornography, one count of transporting child pornography, one count of possessing child pornography and one count of marijuana possession. Today’s sentence was imposed by U.S. District Judge Norman K. Moon.
According to court documents, Miller repeatedly sexually abused a 14-year-old girl and filmed numerous incidents of the abuse during a several month period in 2008. In October 2010, the defendant’s car was stopped by National Park Service (NPS) rangers at a DUI checkpoint in Virginia. The defendant was in the car with the girl he had abused. NPS Rangers quickly determined that a missing persons/runaway report for her had been recorded with the National Crime Information Center.A search of the car revealed, among other things, a laptop computer, a digital camera and marijuana. Forensic examination of the laptop revealed video clips of the 2008 abuse.
In addition to the prison term, Judge Moon sentenced Miller to serve a lifetime of supervised release. Miller will also be required to register as a sex offender.
This case was investigated by the NPS and the FBI, and prosecuted by Assistant U.S. Attorney Nancy S. Healey and Trial Attorney Darcy Katzin of the Department of Justice Criminal Division’s Child Exploitation and Obscenity Section.
Justice Department Reaches Settlement Agreement with City of North Adams, Mass., to Ensure Civic Access for People with DisabilitiesRead the Press Release
The Justice Department today announced an agreement with the city of North Adams, Mass., to improve access for people with disabilities to civic life in North Adams. The agreement was reached under Project Civic Access (PCA), the Justice Department’s initiative to ensure that cities, towns and counties throughout the country comply with the Americans with Disabilities Act (ADA). The compliance review was initiated in response to a complaint that the city’s police station was physically inaccessible.
“The city of North Adams is to be commended for its proactive commitment to ensuring that people with disabilities have full access to the city’s facilities, programs, services and activities,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division.
PCA ensures that persons with disabilities have an equal opportunity to participate in civic life. As part of the PCA initiative, Justice Department investigators, attorneys and architects survey state and local government facilities, services and programs in communities across the country. The purpose of the survey is to identify the modifications needed for compliance with ADA requirements. The agreements are tailored to address the steps each community must take to improve access. PCA agreements include requirements to make physical modifications to facilities so that they are accessible to people with disabilities. Elements that need modifications typically include parking, routes into buildings, entrances, assembly areas, restrooms, service counters and drinking fountains. Other common provisions address effective communication, grievance procedures, polling places, emergency management procedures and policies, sidewalks, domestic violence programs and Web-based services.
Under the agreement announced today, the city of North Adams will take important steps to improve access for people with disabilities. The agreement will remain in effect for three years, and the department will monitor the city’s compliance until the required actions have been completed.
People interested in finding out more about the ADA, today’s agreement with the city of North Adams, the PCA initiative or the ADA Best Practices Tool Kit for state and local governments can access the ADA webpage at www.ada.gov or call the toll-free ADA Information Line at (800) 514-0301 (TDD 800-514-0383).
Monday 15 October 2012
Two Police of Puerto Rico Officers Indicted on Federal Civil Rights and Perjury ChargesRead the Press Release
Police of Puerto Rico Lieutenant Erick Rivera Nazario and Officer Jimmy Rodriguez Vega were indicted on civil rights charges alleging that they used excessive force on two men, the Justice Department announced today. Nazario and Vega allegedly violated the constitutional rights of Jose Irizarry Perez and his father Jose Irizarry Muniz while the two were celebrating the local election results at the Las Colinas housing development in Yauco, Puerto Rico, on Nov. 5, 2008. Rivera was also indicted for making false declarations before the federal grand jury during its investigation into the civil rights violations.
The indictment was announced today by Thomas E. Perez, Assistant Attorney General for the Civil Rights Division; Rosa Emilia Rodriguez-Velez, U.S. Attorney for the District of Puerto Rico; and Joseph Campbell, Special Agent in Charge of the FBI San Juan Field Office.
According to the five-count indictment, Rivera and Rodriguez, while acting under color of law, physically struck and assaulted Irizarry Perez and Irizarry Muniz with police batons, which resulted in bodily injury to both of them, and thereby deprived the victims of their constitutionally protected rights to be free from the use of unreasonable force by those acting under color of law. Rivera, who was a sergeant at the time of the incident, was also charged with failing to intervene and keep the victims from harm when Rodriguez, an officer whom Rivera supervised, assaulted the victims in Rivera’s presence. Finally, Rivera was charged for making false declarations to the federal grand jury related to Rivera’s actions and observations during the incident. Although Irizarry Perez died as a result of injuries he sustained on Nov. 5, 2008, the indictment does not include charges that his death resulted from the defendants’ conduct.
If convicted, Rivera faces a maximum penalty of ten years in prison and a fine of $250,000 for each of four charged counts of civil rights violations and a maximum penalty of five years in prison and a $250,000 fine for one charged count of making false declarations before the grand jury. Rodriguez faces a maximum penalty of ten years in prison and a fine of $250,000 for each of two charged counts of civil rights violations.
An indictment is merely an accusation, and the defendants are presumed innocent unless proven guilty.
This case is being investigated by the San Juan Division of the FBI and is being prosecuted by Assistant U.S. Attorney Jose A. Contreras from the U.S. Attorney’s Office for the District of Puerto Rico and Senior Litigation Counsel Gerard Hogan and Trial Attorney Shan Patel from the Civil Rights Division of the U.S. Department of Justice.
Owner of Miami Home Health Company Sentenced to 120 Months in Prison for $42 Million Health Care Fraud SchemeRead the Press Release
WASHINGTON – The owner and operator of a Miami health care agency was sentenced today to 120 months in prison for his participation in a $42 million home health Medicare fraud scheme, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Acting Special Agent-in-Charge of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher B. Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.
Eulises Escalona, 44, of Monroe County, Fla., was sentenced today by U.S. District Judge Joan A. Lenard in the Southern District of Florida. In addition to sentencing Escalona to prison, Judge Lenard ordered him to pay $26.5 million in restitution.
On Aug. 2, 2012, Escalona pleaded guilty in the Southern District of Florida to one count of conspiracy to commit health care fraud.
According to court documents, Escalona was the owner of Willsand Home Health Inc., a Florida home health agency that purported to provide home health care and physical therapy services to eligible Medicare beneficiaries. Escalona pleaded guilty to conspiring with patient recruiters for the purpose of billing the Medicare program for unnecessary home health care and therapy services. Escalona and his co-conspirators paid kickbacks and bribes to patient recruiters in return for patients, prescriptions, Plans of Care (POCs) and certifications for medically unnecessary therapy and home health services for Medicare beneficiaries. Escalona and co-conspirators also paid kickbacks and bribes directly to physicians, who provided home health and therapy prescriptions, POCs and medical certifications to Escalona and his co-conspirators. Escalona used these prescriptions, POCs and medical certifications to fraudulently bill the Medicare program for home health care services, which Escalona knew was in violation of federal criminal laws.
According to court documents, at Willsand Home Health, patient files for Medicare beneficiaries were falsified to make it appear that such beneficiaries qualified for home health care and therapy services when, in fact, many of the beneficiaries did not actually qualify for such services. Escalona knew that in many cases the patient files at Willsand Home Health were falsified.
From approximately January 2006 through November 2009, Escalona and his alleged co-conspirators submitted approximately $42 million in false and fraudulent claims to Medicare, which paid approximately $27 million on those claims.
This case is being prosecuted by Senior Trial Attorney Joseph S. Beemsterboer of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Houston Ambulance Company Administrator Pleads Guilty to FraudRead the Press Release
WASHINGTON – The administrator of CardioMax EMS, a Houston-based ambulance company, pleaded guilty today to charges that he submitted approximately $1,734,550 in fraudulent claims to Medicare, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Kenneth Magidson of the Southern District of Texas; Special Agent-In-Charge Stephen L. Morris of the FBI’s Houston Field Office; Special Agent-in-Charge Mike Fields of the Dallas Regional Office of the U.S. Department of Health and Human Service’s Office of the Inspector General (HHS-OIG); and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU).
Okechukwu Ofoegbu, 31, of Houston, pleaded guilty today in U.S. District Court in the Southern District of Texas to one count of conspiracy to commit health care fraud.
Ofoegbu was the administrator of Cardiomax EMS, a Houston-based ambulance company that primarily transported patients to community mental health centers. According to Ofoegbu’s plea agreement, from January 2011 through December 2011, Ofoegbu and others at Cardiomax were involved in transporting patients that did not meet the requirements for ambulance transport under Medicare regulations, falsifying ambulance run sheets that described patients’ conditions and using the falsified run sheets to file claims with Medicare. Ofoegbu admitted in his plea agreement that he conspired to submit claims to Medicare for ambulance services that he knew were miscoded, not medically necessary and, in some cases, not provided.
As part of the plea agreement, Ofoegbu has agreed to pay $553,002 in restitution to the United States. At sentencing, scheduled for Jan. 24, 2013, Ofoegbu faces a maximum sentence of 10 years in prison.
Ofoegbu was originally indicted as part of a nationwide takedown on May 2, 2012, that resulted in charges against 107 individuals, including doctors, nurses and other licensed medical professionals, for their alleged participation in Medicare fraud schemes involving approximately $452 million in false billing.
The case was prosecuted by Trial Attorney Laura M.K. Cordova, Special Trial Attorney James S. Seaman, Special Trial Attorney Ronald Cummings and Deputy Chief Sam S. Sheldon of the Criminal Division’s Fraud Section. The case was investigated by HHS-OIG, FBI and the Texas Attorney General’s Medicaid Fraud Control Unit, as part the Medicare Fraud Strike Force, supervised by the U.S. Attorney’s Office for the Southern District of Texas and the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Former Colombian Prosecutor Pleads Guilty to Role in International Drug Trafficking ConspiracyRead the Press Release
WASHINGTON – A former Colombian prosecutor pleaded guilty today to providing law enforcement information to drug traffickers as part of a conspiracy to import cocaine into the United States, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Drug Enforcement Administration (DEA) Special Agent in Charge Mark R. Trouville of the Miami Field Division.
Ramiro Anturi Larrahondo, 55, a Colombian national, pleaded guilty before U.S. District Judge John D. Bates in the District of Columbia to one count of conspiracy to distribute five kilograms or more of cocaine, knowing and intending that the cocaine would be illegally imported into the United States. The plea agreement is subject to court approval.
Anturi Larrahondo is the first Colombian prosecutor ever to be extradited to the United States.
“Ramiro Anturi Larrahondo used his position as a Colombian prosecutor to leak sensitive law enforcement intelligence to large-scale drug traffickers in exchange for his own personal enrichment,” said Assistant Attorney General Breuer. “Anturi Larrahondo undermined international law enforcement operations and betrayed the trust placed in him by the Colombian government. As the first case ever in which a Colombian prosecutor is being extradited to the United States, this matter shows how dogged we are in our pursuit of narcotics traffickers and how determined we are to hold accountable those smuggling drugs into this country.”
“The DEA will not tolerate any acts that put our agents’ lives in jeopardy,” said DEA Special Agent in Charge Trouville. “Mr. Anturi Larrahondo will now face the consequences of his criminal conduct to assist drug traffickers.”
Anturi Larrahondo was indicted by a federal grand jury on Jan. 26, 2010, in the District of Columbia. According to court documents, in 2009, while serving as a Colombian prosecutor, Anturi Larrahondo provided sensitive law enforcement investigative information to a major Colombian maritime drug trafficking organization.
According to Anturi Larrahondo’s plea agreement, the drug trafficking organization Anturi Larrahondo conspired with was responsible for transporting cocaine by go-fast vessels from the port city of Buenaventura, Colombia, to Central America, with the ultimate destination being the United States. During the investigation, Colombian judicial wire intercepts recorded Anturi Larrahondo speaking to representatives of the drug trafficking organization and a DEA cooperating source regarding financial payments to Anturi Larrahondo, delivery of documents to the drug trafficking organization and the coordination of meetings between Anturi Larrahondo and representatives of the drug trafficking organization.
As part of his plea agreement, Anturi Larrahondo admitted he received regular monthly payments from the Colombian drug trafficking organization in order for the drug traffickers to find out what, if any, criminal investigation the governments of Colombia or the United States were conducting against the drug traffickers. Anturi Larrahondo further admitted that he received the corrupt payments in order to protect the drug trafficking organization from law enforcement. Members of the Colombian drug trafficking organization made regular monthly cash payments to Anturi Larrahondo of 21 million pesos, the equivalent of approximately $10,000 in U.S. currency.
Anturi Larrahondo’s sentencing hearing has been scheduled for Nov. 26, 2012.
This case is being prosecuted by Trial Attorneys Mark Maldonado, Stephen May and Stephen Sola of the Criminal Division’s Narcotic and Dangerous Drug Section, with significant assistance from the section’s judicial attaches in Bogota, Colombia, the Criminal Division’s Office of International Affairs and the Prosecutor General’s Office of the Republic of Colombia. The case was investigated by DEA’s Bogota Country Office and the Miami Field Division, in coordination with the Judicial Police of the Prosecutor General’s Office in Colombia and the Colombian National Police.
CVS Subsidiary, RxAmerica, Reaches $5 Million Settlement with US for Allegedly Submitting False Pricing Relating to the Company’s Medicare Part D PlanRead the Press Release
In one of the first False Claims Act settlements involving Medicare’s Prescription Drug Program, known as Part D, RxAmerica LLC. has entered into a civil settlement agreement with the United States in which it has agreed to pay the government $5.25 million to resolve allegations that it made false submissions to the Centers for Medicare & Medicaid Services (CMS), the Justice Department announced today. RxAmerica, a wholly-owned subsidiary of CVS Caremark Corporation, provides prescription drug benefits to Medicare beneficiaries pursuant to a prescription drug plan.
The Medicare program offers Part D participants prescription drug coverage. For Medicare participants to obtain this drug coverage, they must join a Medicare-approved plan, often referred to as a Part D plan. Medicare Part D plans can vary in both the drugs that they cover, the amount they reimburse for those drugs, and the deductibles and co-pays they require their participants to pay.
To assist participants to choose a Part D plan that minimized their out-of-pocket costs, CMS offered a web-based tool called Plan Finder, which allowed Medicare Part D beneficiaries to determine estimated prescription drug prices for each Medicare Part D plan that the beneficiary considered for enrollment. CMS obtained the pricing information that is contained on Plan Finder from data submitted to CMS by each Part D Plan sponsor.
The United States alleged that during the period Jan. 1, 2007, to Dec. 31, 2008, RxAmerica made false submissions to CMS regarding prices for certain generic prescription drugs used for Plan Finder, despite certifying to CMS that it would submit accurate pricing data for Plan Finder. As a result, the government alleged that RxAmerica received Medicare Part D payments for claims for the covered drugs at prices that in some cases were significantly higher than the pricing data RxAmerica submitted to CMS for use on Plan Finder.
“The Department of Justice is committed to protecting the Medicare drug prescription program against all types of misconduct,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department's Civil Division. “As today's settlement demonstrates, we will ensure that Medicare Part D sponsors submit accurate drug pricing information, to ensure the integrity of the Medicare Part D program and to protect the beneficiaries who participate in the program.”
“The health care choices facing Americans are complicated enough without patients being misinformed and forced to select a Part D plan based on false data. Those navigating our Medicare system deserve accurate information so they can make informed choices and obtain the benefits to which they are entitled. The Medicare system deserves honest input from plan sponsors, so it can continue to safeguard taxpayer dollars. Nothing less will suffice,” stated Loretta Lynch, U.S. Attorney for the Eastern District of New York. “This case exemplifies our continuing dedication to combating all types of alleged health care fraud that can eat away at our precious public health care dollars.”
“ RxAmerica was charged with advertising false drug prices to Medicare Part D enrollees,” said Daniel R. Levinson, Inspector General of the Department of Health and Human Services. “Protecting people in government health programs from those seeking to profit by misrepresenting goods and services is one of our top law enforcement priorities.”
Today’s settlement resolves allegations made in two separate complaints against RxAmerica filed under the False Claims Act’s qui tam or whistleblower provisions, which permit a private individual to file suit for false claims to the United States and share in any recovery. The first complaint, U.S. ex rel. Doe v. RxAmerica, was filed in the United States District Court of the Eastern District of New York in November 2008. The second complaint, U.S. ex rel. Hauser v. CVS Caremark Corp. and RxAmerica, was filed in the United States District Court for the Western District of North Carolina in June 2009. The two cases were consolidated in the Eastern District of New York in November 2011.
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 over $10 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 $13.8 billion.
The Federal Trade Commission reached an agreement with CVS, RxAmerica’s parent corporation, earlier this year in which CVS agreed to pay $5 million to resolve allegations relating to RxAmerica’s inaccurate Plan Finder submissions from late 2007 through 2008. The resolution from the FTC’s settlement is being used to compensate beneficiaries.
The investigation in this matter was handled by the Department of Justice’s Civil Division, the U.S. Attorney’s Office for the Eastern District of New York, HHS-OIG and CMS. The claims resolved by this settlement are allegations only, and there has been no admission of liability by RxAmerica or CVS.
Friday 12 October 2012
Man Pleads Guilty in Ohio Federal Court to Tax and Mortgage Fraud ConspiraciesRead the Press Release
Steven R. Hinz pleaded guilty today to tax fraud and mortgage fraud charges in Cleveland federal court, the Justice Department and Internal Revenue Service (IRS) announced. Hinz’s guilty pleas followed recent guilty pleas of three other defendants – Heather L. English, Patricia A. Polk and William E. Phillips III – who were charged in indictment in December 2011 on a tax conspiracy and various false return charges. The case is assigned to U.S. District Judge Patricia A. Gaughan, who scheduled the sentencing for January 2013.
Hinz pleaded guilty to one count of conspiracy to defraud the United States, one count of making a false 2008 income tax return, fifteen counts of aiding and assisting the preparation of false income tax returns and one count of conspiracy to commit bank fraud involving a mortgage fraud scheme. On Oct. 11, 2012, co-defendant Polk also pleaded guilty to the tax fraud conspiracy and the bank fraud conspiracy. On Oct. 4, 2012, co-defendant English pleaded guilty to tax fraud conspiracy and one count of aiding and assisting the preparation and presentation of Hinz’s false 2008 tax return. Also on Oct. 4, 2012, co-defendant Phillips pleaded guilty to the tax fraud conspiracy. Hinz was arrested in Miami in January 2012 and Polk was arrested in Sarasota, Fla., in February 2012. Phillips was arrested in Los Angeles in June 2012, after being deported from the Philippines upon request of the U.S. government. Hinz and Polk were also charged with the bank fraud conspiracy in supplemental information that was filed with the district court yesterday.
According to the indictment and documents submitted to the court, Hinz promoted a scheme to defraud the United States by filing false federal income tax returns claiming large tax refunds using the so-called Original Issue Discount (OID) process. The OID process involved the preparation of fictitious IRS Forms 1099-OID, falsely reporting that financial institutions, creditors and other entities had withheld large amounts of federal income tax on behalf of the defendants and other taxpayers, with respect to fictitious income. Hinz and English recruited potential clients by promoting the OID scheme to investors and employees of Hinz’s real estate business in Youngstown, Ohio. English prepared or directed the preparation of the 1099-OID forms and prepared and electronically filed the tax returns. Based on these fictitious withholdings, at least 17 false income tax returns for the year 2008 were filed with the IRS, claiming false refunds totaling over $3 million dollars. Under the scheme, taxpayers recruited by Hinz were to pay 20 percent of their refunds to Hinz and English, split equally between the two.
According to the supplemental information and other documents filed with the court, from approximately December 2006 through May 2009, Hinz conducted his real estate business in part through a scheme to defraud two federally-insured banks, Wells Fargo Bank and Huntington National Bank, which provided mortgage loans to the investors. The scheme was carried out through the filing of false mechanic’s liens for work not actually done and the providing of undisclosed down payment assistance to the investors. The scheme was designed to induce the banks to make mortgage loans based on false representations concerning the true price and value of the properties, the sources of down payments, and the disposition of loan proceeds. According to court documents, Polk began conspiring with Hinz to conduct the scheme beginning approximately April 2008.
Each defendant’s sentence will be determined by Judge Gaughan. The maximum potential sentence for Hinz is 83 years in prison. The maximum potential sentence for Polk is 35 years. The maximum potential sentence for Phillips is five years. The maximum potential sentence for English is eight years in prison.
The case is being handled by Assistant U.S. Attorneys John M. Siegel and Henry F. DeBaggis and Tax Division Trial Attorney Robert C. Kennedy, following investigation by the IRS, Criminal Investigation, the Office of Investigations of the Department of Housing and Urban Development Office of Inspector General and the FBI.
Justice Department Announces Policy on Tribal Member Use of Eagle FeathersRead the Press Release
WASHINGTON – The Department of Justice announced today a policy addressing the ability of members of federally recognized Indian tribes to possess or use eagle feathers, an issue of great cultural significance to many tribes and their members. Attorney General Eric Holder signed the new policy after extensive department consultation with tribal leaders and tribal groups. The policy covers all federally protected birds, bird feathers and bird parts.The Attorney General's memorandum is the first formal policy statement adopted by the Justice Department on this issue. It clarifies and expands on longstanding Department practice, consistent with the Department of the Interior's 35-year old Morton Policy, of not prosecuting tribal members for possessing or using eagle feathers and other protected bird parts.
Federal wildlife laws such as the Bald and Golden Eagle Protection Act generally criminalize the killing of eagles and other migratory birds and the possession or commercialization of the feathers and other parts of such birds. These important laws are enforced by the Department of Justice and the Department of the Interior and help ensure that eagle and other bird populations remain healthy and sustainable.
At the same time, the Department of Justice recognizes that eagles play a unique and important role in the religious and cultural life of many Indian tribes. Many Indian tribes and tribal members have historically used, and today continue to use federally protected birds, bird feathers or other bird parts for their tribal cultural and religious expression. Federal wildlife laws recognize the importance of accommodating tribal spiritual needs by allowing exceptions for the religious purposes of Indian tribes. Eagle feathers are made available to tribal members every year from the Fish and Wildlife Service's National Eagle Repository.
“This policy will help ensure a consistent and uniform approach across the nation to protecting and preserving eagles, and to honoring their cultural and spiritual significance to American Indians,” said Attorney General Holder. “The Department of Justice is committed to striking the right balance in enforcing our nation’s wildlife laws by respecting the cultural and religious practices of federally recognized Indian tribes with whom the United States shares a unique government-to-government relationship.”
The department is issuing this policy to address the concerns of tribal members who are unsure of how they may be affected by federal wildlife law enforcement efforts, and because of a concern that this uncertainty may hinder or inhibit tribal religious and cultural practices. The department first announced it was considering formalizing a policy on eagle feathers in October 2011 and sought tribal input at that time. The department held formal consultations with tribal leaders in June, July and August 2012.
“From time immemorial, many Native Americans have viewed eagle feathers and other bird parts as sacred elements of their religious and cultural traditions,” said Ignacia S. Moreno, Assistant Attorney General of the Justice Department’s Environment and Natural Resources Division. “The Department of Justice has taken a major step forward by establishing a consistent and transparent policy to guide federal enforcement of the nation’s wildlife laws in a manner that respects the cultural and religious practices of federally recognized Indian tribes and their members.”
“The Justice Department’s policy balances the needs of the federally recognized tribes and their members to be able to obtain, possess and use eagle feathers for their religious and cultural practices with the need to protect and preserve these magnificent birds,” said Donald E. “Del” Laverdure, Principal Deputy Assistant Secretary for Indian Affairs. “Its reasoned approach reflects a greater understanding and respect for cultural beliefs and spiritual practices of Indian people while also providing much-needed clarity for those responsible for enforcing federal migratory bird protection laws.”
“This policy helps to clarify how federal law enforcement goes about protecting these special birds and also should reassure federally recognized tribal members that they do not have to fear prosecution for possessing or using eagle feathers for their religious and cultural purposes,” said Brendan V. Johnson, U.S. Attorney for the District of South Dakota and the Chairman of the Native American Issues Subcommittee of the Attorney General’s Advisory Committee.
“Eagles and other native migratory bird species are a vital part of our nation’s natural heritage, and we remain dedicated to providing every American with the opportunity to experience them in the wild,” said U.S. Fish and Wildlife Service Director Dan Ashe. “This new policy honors the past while looking to the future, contributing to the preservation of these species and ensuring that tribal members can continue their religious and cultural practices for generations to come.”
The policy provides that, consistent with the Department of Justice’s traditional exercise of its discretion, a member of a federally recognized tribe engaged only in the following types of conduct will not be subject to prosecution:
· Possessing, using, wearing or carrying federally protected birds, bird feathers or other bird parts (federally protected bird parts);
· Traveling domestically with federally protected bird parts or, if tribal members obtain and comply with necessary permits, traveling internationally with such items;
· Picking up naturally molted or fallen feathers found in the wild, without molesting or disturbing federally protected birds or their nests;
· Giving or loaning federally protected bird parts to other members of federally recognized tribes, without compensation of any kind;
· Exchanging federally protected bird parts for federally protected bird parts with other members of federally recognized tribes, without compensation of any kind;
· Providing the feathers or other parts of federally protected birds to craftspersons who are members of federally recognized tribes to be fashioned into objects for eventual use in tribal religious or cultural activities.
The Department of Justice will continue to prosecute tribal members and non-members alike for violating federal laws that prohibit the killing of eagles and other migratory birds or the buying or selling of the feathers or other parts of such birds.
The policy expands upon longstanding Department of Justice practice and Department of the Interior policy. It was developed in close coordination with the Department of the Interior. The Department of Justice’s Environment and Natural Resources Division (ENRD) and United States Attorneys’ Offices work closely with the Department of the Interior’s U.S. Fish and Wildlife Service and Bureau of Indian Affairs on enforcement of federal laws protecting birds.
To view the policy and a fact sheet on the policy, visit: www.justice.gov/tribal.
Department of Justice Executes Restraint Against Additional $4 Million in Assets of Former Nigerian GovernorRead the Press Release
WASHINGTON – The Department of Justice has executed restraints on more than $4 million in additional corruption proceeds in connection with the prosecution and conviction in the United Kingdom of James Onanefe Ibori, the former governor of Nigeria’s oil-rich Delta State, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Immigration and Customs Enforcement (ICE) Director John Morton. As a result of this action, the United States has restrained more than $7 million in assets tied to Ibori and his associates, including the $4 million that were restrained last week and more than $3 million in assets previously made subject to a restraining order issued by Chief Judge Royce C. Lamberth of the U.S. District Court for the District of Columbia on May 22, 2012.
Specifically, the Department of Justice filed an application to supplement the prior order in the District of Columbia to identify for restraint a luxury condominium unit at the Residences at the Ritz-Carlton in Washington, D.C., as well as proceeds from the sale of another condominium, a penthouse unit, located at the Ritz-Carlton. On Oct. 4, 2012, the District Court amended its prior order to name these additional assets, which the United States executed against the Ritz-Carlton condominium and over $3 million in proceeds from the sale of the penthouse unit. The United States is working closely with the United Kingdom’s Crown Prosecution Service and the Metropolitan Police Service to forfeit these corruption proceeds.
According to the original and supplemental applications, Governor Ibori served as the governor of Nigeria’s oil-rich Delta State from 1999 to 2007, and misappropriated millions of dollars in Delta State funds. He laundered those proceeds through a myriad of shell companies, intermediaries and nominees in several jurisdictions, including the United Kingdom. Although Nigeria’s Constitution prohibits state governors from maintaining foreign bank accounts and serving as directors of private companies, Governor Ibori and his associates accumulated millions of dollars in assets in the United Kingdom and the United States, according to the applications. Governor Ibori was convicted in the United Kingdom of money laundering and conspiracy to defraud and was sentenced by a British court on April 18, 2012, to 13 years in prison.
The case is being prosecuted by trial attorneys Woo S. Lee and Elizabeth Aloi of the Criminal Division’s Asset Forfeiture and Money Laundering Section. The case was investigated by ICE Homeland Security Investigations’ (HSI) Foreign Corruption Investigations Group, HSI Asset Identification and Removal Group in Miami and HSI Attaché London.
This case is part of the Justice Department’s Kleptocracy Asset Recovery Initiative. This initiative is carried out by a dedicated team of prosecutors in the Criminal Division’s Asset Forfeiture and Money Laundering Section, working in partnership with federal law enforcement agencies to forfeit the proceeds of foreign official corruption and where appropriate return those proceeds to benefit those harmed.
Individuals with information about possible proceeds of foreign corruption located in or laundered through institutions in the United States should contact federal law enforcement or email [email protected].
ICE-HSI’s Foreign Corruption Investigations Group in Miami targets corrupt foreign officials around the world that attempt to utilize U.S. financial institutions to launder illicit funds. The group conducts investigations into the laundering of proceeds emanating from foreign public corruption, bribery or embezzlement. The objective is to prevent foreign derived ill-gotten gains from entering the U.S. financial infrastructure, to seize identified assets in the United States and repatriate these funds on behalf of those affected by foreign official corruption.
Thursday 11 October 2012
Owner of Texas Home Health Services Company Pleads <br /> Guilty, Admits Role in $374 Million Fraud SchemeRead the Press Release
WASHINGTON - A Dallas-area home health services company owner today admitted his role in a $374 million home health fraud scheme in which he and others conspired to bill Medicare for unnecessary services that were never performed. Cyprian Akamnonu, 64, of Arlington, Texas, entered his guilty plea to one count of conspiracy to commit health care fraud before U.S. District Judge Sam A. Lindsay in Dallas federal court.The guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department's Criminal Division; U.S. Attorney for the Northern District of Texas Sarah R. Saldaña; Special Agent in Charge Diego G. Rodriguez of the FBI’s Dallas Field Office; Special Agent in Charge Mike Fields of the U.S. Department of Health and Human Services Office of Inspector General's (HHS-OIG) Dallas Regional Office; and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU).
According to court documents, beginning in at least January 2006, Akamnonu, along with his wife Pat Akamnonu, owned and operated Ultimate Care Home Health Services, Inc. Cyprian Akamnonu admitted that he directed his wife and others to recruit Medicare beneficiaries from Dallas neighborhoods for home health services they did not need and for which they did not qualify. Once the beneficiaries were recruited, Cyprian Akamnonu would take prescriptions for home health services to the offices of Medistat Group Associates, P.A., owned and operated by co-defendant Jacques Roy, M.D.
Cyprian Akamnonu admitted he brought the prescriptions to Roy because he and Roy had a fraudulent arrangement whereby Ultimate provided Roy with beneficiaries to bolster Medistat’s patient roster in exchange for Roy’s certification for skilled nursing services of any beneficiary brought to him. Roy’s office manager, co-defendant Teri Sivils, and others would allegedly then sign these prescriptions on Roy’s behalf. Cyprian Akamnonu admitted to paying Sivils cash to sign the prescriptions.Cyprian Akamnonu admitted that once he obtained signed prescriptions, nurses acting at his direction would perform cursory visits for the beneficiaries they had recruited that bore little relationship to the skilled nursing services which Roy had purportedly prescribed. Ultimate would then bill Medicare, at Cyprian Akamnonu’s direction, for skilled nursing services that were not necessary and were not performed.
Court documents show that from January 2006 through November 2011, Roy or another Medistat physician allegedly certified over 78% of the beneficiaries serviced by Ultimate. Ultimate billed over $43 million to the Medicare program for these beneficiaries. Roy, in turn, allegedly incorporated these beneficiaries into his own practice and billed over $2.4 million for services related to them.At sentencing, Cyprian Akamnonu faces a maximum potential penalty of 10 years in prison and a $250,000 fine on the conspiracy count. Sentencing is currently scheduled for Feb. 4, 2013. As part of his plea agreement, he has also agreed not to contest the forfeiture of 21 real properties, four automobiles, and funds in a number of personal and business accounts connected to proceeds of the fraud.
His six co-defendants, including his wife, await trial on related charges, currently set for June 2013. The charges and allegations contained in the indictment against them are merely accusations and the defendants are presumed innocent unless and until proven guilty.
The case is being prosecuted by Assistant U.S. Attorneys Michael Elliott and Mindy Sauter of the U.S. Attorney’s Office for the Northern District of Texas, and Deputy Chief Sam Sheldon and Trial Attorney Ben O’Neil of the Criminal Division's Fraud Section. The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division's Fraud Section and the U.S. Attorney's Office for the Northern District of Texas.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS's Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
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Factual Resume
Miami-Area Therapist Sentenced to 108 Months in Prison for Participating in $205 Million Medicare Fraud SchemeRead the Press Release
WASHINGTON – Miami-area resident Vanja Abreu (Ph.D), former program director at the mental health care company American Therapeutic Corporation (ATC), was sentenced today to 108 months in prison for participating in a $205 million Medicare fraud scheme, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Acting Special Agent-in-Charge Michael B. Steinbach of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
Abreu, 49, of Pembroke Pines, Fla., was sentenced by U.S. District Judge Patricia A. Seitz in the Southern District of Florida. In addition to her prison term, Judge Seitz sentenced Abreu to serve three years of supervised release following her prison term and pay $72,771,469 in restitution, jointly and severally with co-defendants.
On June 1, 2012, after a seven week trial, a federal jury in the Southern District of Florida found Abreu guilty of one count of conspiracy to commit health care fraud.
Evidence at trial demonstrated that Abreu and her co-conspirators caused the submission of false and fraudulent claims to Medicare through ATC, a Florida corporation headquartered in Miami that operated purported partial hospitalization programs (PHPs), intensive treatments for severe mental illness, in seven different locations throughout South Florida and Orlando.
Evidence at trial revealed that ATC secured patients by paying kickbacks to assisted living facility owners and halfway house owners who would then steer patients to ATC. These patients attended ATC, where they were ineligible for the treatment ATC billed to Medicare and where they did not receive the treatment that was billed to Medicare. After Medicare paid the claims, some of the co-conspirators then laundered the Medicare money in order to create cash to pay the patient kickbacks.
Evidence at trial revealed that Abreu was a program director at ATC’s Boca Raton, Fla., center from September 2005 to November 2005. In November 2005, Abreu moved to ATC’s Miami center, where she was the program director until February 2009, at which point she was promoted to corporate leadership and oversaw operations at all ATC centers until April 2010. Evidence at trial revealed that program directors, including Abreu, helped doctors at ATC sign patient files without reading the files or seeing the patients. Evidence further revealed that Abreu and others would assist the owners of ATC in fabricating doctor notes, therapist notes and other documents to make it falsely appear in ATC’s patient files that patients were qualified for this highly specialized treatment and that the patients were receiving the intensive, individualized treatment PHP is supposed to be. Included in these false and fraudulent submissions to Medicare were claims for patients who were in the late stages of diseases causing permanent cognitive memory loss and patients who had substance abuse issues and were living in halfway houses. These patients were ineligible for PHP treatment, and because they were forced by their assisted living facility owners and halfway house owners to attend ATC, they were not receiving treatment for the diseases they actually had.
Abreu was charged in an indictment returned on Feb. 8, 2011. ATC, the management company associated with ATC, and 20 individuals, including the ATC owners, have all previously pleaded guilty or have been convicted at trial.
ATC executives Lawrence Duran, Marianella Valera, Judith Negron and Margarita Acevedo were sentenced to 50 years, 35 years, 35 years and 91 months in prison, respectively, for their roles in the fraud scheme. The 50- and 35-year sentences represent the longest sentences for health care fraud ordered to date. Acevedo, who was one of the first defendants to plead guilty and has been cooperating with the government since November 2010, testified at the doctors’ trial.
ATC and its management company, Medlink Professional Management Group Inc., pleaded guilty in May 2011 to conspiracy to commit health care fraud. ATC also pleaded guilty to conspiracy to defraud the United States and to pay and receive illegal health care kickbacks. On Sept. 16, 2011, the two corporations were sentenced to five years of probation per count and ordered to pay restitution of $87 million. Both corporations have been defunct since their owners were arrested in October 2010.
The case was prosecuted by Trial Attorneys Jennifer L. Saulino, Robert A. Zink and James V. Hayes of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Justice Department Settles with Florida Bus Companies over Accessibility ViolationsRead the Press Release
The Justice Department reached four settlement agreements with over-the-road bus companies in Florida in the last month, to ensure that bus transportation is accessible for people with disabilities. The settlements under the Americans with Disabilities Act (ADA) are with Dynamic Tours & Transportation Inc., Alltour America Transportation, Jet Set Line Inc. and VIP’s Jet Tours Corp./Pegasus Transportation.
The settlements are the product of collaborative enforcement efforts between the Justice Department and the Federal Motor Carrier Safety Administration (FMCSA) of the U.S. Department of Transportation . The agreements remedy violations by the bus companies, including failing to maintain wheelchair lifts in working condition, failing to file required reports regarding ADA compliance, and lack of staff training on accessibility requirements. The settlement agreements require the bus companies:
- To comply with all ADA requirements for accessible service, and not exclude persons with disabilities from their transportation services;
- To train all employees and contractors on the requirements of the ADA;
- To properly maintain all wheelchair lifts (to the extent a company has lift-equipped buses); and
- To file required annual reports with the FMCSA.
“People with disabilities must be able to count on accessible bus service that is equal to the service provided to others,” said Thomas E. Perez, Assistant Attorney General of the Civil Rights Division.
“FMCSA will continue to work closely with the Department of Justice to enforce ADA compliance so that all travelers can enjoy destinations across America by way of commercial bus,” said Anne S. Ferro, Administrator of the Department of Transportation's Federal Motor Carrier Safety Administration.
Title III of the ADA prohibits discrimination against people with disabilities by public accommodations, including small over-the-road bus companies. The Department of Transportation’s regulations implementing the ADA require that such companies perform regular maintenance checks to ensure that wheelchair lifts work, provide prompt accessible service with an alternative carrier if a small company does not have a lift-equipped bus, train their employees on accessibility requirements, and file annual accessibility reports with the FMCSA.
In the past year, the Justice Department has reached a total of 22 settlements with bus companies to ensure compliance with accessibility obligations.
People interested in finding out more about the ADA or these settlements can call the toll-free ADA Information Line at 800-514-0301 (TDD 800-514-0383) or access the ADA website at www.ada.gov .
Justice Department Files Lawsuit Against Three Related Companies for Violating Fair Credit Reporting ActRead the Press Release
The United States has filed a complaint against three related companies that bought and sold consumer credit reports, the Justice Department announced today. The government’s complaint charges these companies with violating the Fair Credit Reporting Act (FCRA). The companies have agreed to pay a $1.2 million civil penalty to resolve these charges.
In a complaint filed Oct. 9, 2012, the United States alleged that Direct Lending Source Inc., and Bailey & Associates Advertising Inc., both Florida corporations, Virtual Lending Source LLC, based in San Diego, Calif., and the principals of all of these entities, Robert M. Bailey, Jr. and Linda Giordiano , violated the FCRA by failing to comply with provisions forbidding the sale of credit reports without a “permissible purpose.” The complaint alleges that the defendants purchased thousands of “pre-screened” consumer lists, or collections of credit report data. The only permissible purpose under the Act for using such prescreened lists is to make “firm offers of credit or insurance” to consumers. However, the complaint alleges that the defendants re-sold the lists to dealers who marketed loan modification, debt relief and credit repair services rather than making firm offers of credit. According to the complaint, some of the dealers who purchased the defendants’ credit report data have become the subject of law enforcement actions or warnings involving fraud committed against consumers in financial trouble.
The complaint also alleges that the defendants did not take reasonable steps to identify the ultimate purchasers of the credit reports. In some cases, according to the complaint, the defendants sold lists to brokers who then re-sold them to unidentified entities.
“The sensitive financial information in credit reports must be protected from those who would use it to target vulnerable consumers for sham offers,” said Stuart Delery, Acting Assistant Attorney General for the Civil Division. “We will work with the Federal Trade Commission to aggressively enforce the laws that safeguard these reports.”
Along with the $1.2 million civil penalty, the defendants agreed to injunctions against future FCRA and FTC violations in a proposed consent decree that must be approved by the court. The proposed order would prohibit the defendants from using, obtaining or reselling consumer reports for unauthorized purposes. The proposed order also would prohibit the defendants from selling consumer reports in connection with solicitations for debt relief and mortgage relief services that charge advance fees.
The Federal Trade Commission (FTC), which oversees the FCRA, referred the case to the Department. The lawsuit, United States v. Direct Lending Source et al., was filed in the Southern District of California.
Acting Assistant Attorney General Delery thanked the FTC for referring this matter to the Department. The Consumer Protection Branch of the Justice Department’s Civil Division brought the case on behalf of the United States.
Justice Department Announces Lawsuit to Protect Rights of Military and Overseas Voters in VermontRead the Press Release
The Justice Department announced today that it has filed a lawsuit against the state of Vermont and its chief election official to help ensure that military service members, their family members and U.S. citizens living overseas have the opportunity to participate fully in the Nov. 6, 2012 federal general election.
The lawsuit, brought under the Uniformed and Overseas Citizens Absentee Voting Act (UOCAVA), was filed in federal district court in Vermont, in coordination with the U.S. Attorney’s Office for the District of Vermont. The department brought this enforcement action after the state failed to send more than 20 percent of the absentee ballots requested by Vermont’s military and overseas voters for the Nov. 6, 2012 federal general election by the 45th day prior to the election, as required by UOCAVA. The United States seeks an order requiring the state of Vermont to ensure that military and overseas voters will have sufficient opportunity to receive, cast and return their ballots in time to be counted by extending the deadline until Nov. 16, 2012, for the receipt of ballots from affected UOCAVA voters. The lawsuit also seeks relief requiring Vermont to notify affected UOCAVA voters, to provide reports to the United States about Vermont’s compliance with UOCAVA, and to take all necessary actions to ensure UOCAVA compliance in future federal elections.
“Our armed forces, their families and overseas citizens deserve a meaningful opportunity to fully participate in our nation’s elections,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “ We are filing this lawsuit to ensure that Vermont’s military and overseas voters will be provided the full 45 days guaranteed by UOCAVA to receive, mark and return their ballots in the upcoming November general election. ”
UOCAVA requires states to allow uniformed service voters (serving both overseas and within the United States) and their families as well as overseas citizens to register to vote and to vote absentee for all elections for federal office. In 2009, Congress enacted the MOVE Act, which made broad amendments to UOCAVA, including the requirement that states transmit absentee ballots to voters covered under UOCAVA, by mail or electronically at the voter’s option, no later than 45 days before federal elections.
More information about UOCAVA and other federal voting laws is available on the Department of Justice website at www.justice.gov/crt/about/vot/misc/activ_uoc.php . Please report any complaints to the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.
Former U.S. Navy Seaman Sentenced to Five Years in Prison for Possessing Child PornographyRead the Press Release
WASHINGTON – A former U.S. Navy seaman was sentenced today to five years in prison for possessing child pornography, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.
James Driver, 24, of Midland, Mich., was sentenced today by U.S. District Judge Thomas L. Ludington in the Eastern District of Michigan. In addition to his prison term, Driver was sentenced to five years of supervised release. After Driver completes his prison term, he must register as a sex offender as a condition of release.
Following a four-day jury trial, Driver was found guilty on May 21, 2012, of one count of possessing child pornography. According to court documents and testimony presented during the trial, the case originated from a Naval Criminal Investigative Service (NCIS) investigation into an individual, later identified as Driver, suspected of possessing and distributing child pornography using a peer-to-peer file sharing network. Driver, who at the time was a U.S. Navy seaman stationed in Japan, admitted in an interview to being interested in child pornography for the past five years.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ offices and the Child Exploitation and Obscenity Section (CEOS) of the Justice Department’s Criminal Division, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case was prosecuted by CEOS Trial Attorney Mi Yung Park and former CEOS Trial Attorney Thomas Franzinger. The case was investigated by NCIS and CEOS’s High Technology Investigative Unit. Assistance was provided by the FBI’s Innocent Images Unit.Former Owners of Los Angeles DME Wholesale Company Arrested<br /> and Charged with Participating in $16.6 Million<br /> Medicare Fraud SchemeRead the Press Release
WASHINGTON – The former owners of a durable medical equipment (DME) wholesale company located in Ontario, Calif., were arrested late yesterday at Los Angeles International Airport in connection with a DME fraud scheme that resulted in the submission of over $16.6 million in false claims to Medicare and are expected to appear this afternoon in Los Angeles federal court.
The arrest was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney André Birotte Jr. of the Central District of California; Glenn R. Ferry, Special Agent-in-Charge for the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); and Timothy Delaney, Special Agent in Charge of the FBI’s Los Angeles Field Office.Rajinder Singh Paul, 69, and his wife, Baljit Kaur Paul, 65, were arrested on conspiracy and health care fraud charges at the airport as they returned from a trip abroad. According to the indictment unsealed upon their arrests, Rajinder and Baljit Paul owned and operated a DME wholesale supply company called Major’s Wholesale Medical Supply Inc., which was located in Ontario. Between 2002 and 2009, according to the indictment, when they were terminated from Major’s after selling its assets to a new owner, Rajinder and Baljit Paul sold primarily high-end power wheelchairs to DME supply companies for approximately $850 to $1,000 per wheelchair. The DME companies, many of which were allegedly fraudulent, billed these power wheelchairs to Medicare at a cost of $3,000 to $6,000 per wheelchair.
According to the indictment, in order to attract and keep the DME companies’ business and prevent Medicare from withholding money that the companies would use to pay Major’s, Rajinder and Baljit Paul provided over 170 DME companies with backdated, altered, and fabricated invoices which reflected that the companies had purchased power wheelchairs and DME from Major’s earlier than they had. Rajinder and Baljit Paul also allegedly provided the DME companies with false invoices for DME that the companies never purchased from Major’s. Rajinder Paul, Baljit Paul, or employees acting at their direction, allegedly created these false invoices using invoice numbers from old invoices or serial numbers from DME that Major’s had already sold or not yet received from its manufacturers. The DME companies then allegedly used these backdated, altered, and fabricated invoices to defraud Medicare or thwart Medicare audits.
In addition, the indictment alleges that the Pauls provided the DME companies with false inventory purchase agreements that showed the companies had credit limits with Major’s which were higher than the credit limits that Major’s actually extended to the companies. The DME companies then submitted these false inventory purchase agreements to Medicare to meet one of the Medicare regulations necessary for the companies to obtain and maintain their Medicare billing privileges, namely, that the companies had contracts with DME wholesalers and other parties to purchase the DME that they billed to Medicare.
The indictment alleges that as a result of this scheme, the Pauls and the owners and operators of certain of the companies that Rajinder and Baljit Paul provided with fraudulent invoices submitted approximately $16,662,143 in false claims to Medicare, and received approximately $9,743,609 on those claims.
Rajinder and Baljit Paul are each charged with one count of conspiracy to commit health care fraud and one count of making false statements. The conspiracy count carries a maximum potential penalty of 10 years in prison, and the false statements count carries a maximum potential penalty of five years in prison. Each count also carries a maximum $250,000 fine.
The case is being prosecuted by Trial Attorney Jonathan T. Baum of the Criminal Division’s Fraud Section. The case is being investigated by the FBI, HHS-OIG, and the California Department of Justice, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California.
The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.Since its inception in March 2007, strike force operations in nine locations have charged more than 1,480 defendants who collectively have billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Former COO of Louisiana Construction Management Company and Brother-In-Law Charged in Fraud SchemeRead the Press Release
WASHINGTON – Mark J. Titus, former Chief Operations Officer of Garner Services Ltd. (GSL), and his brother-in-law Dominick Fazzio, have been charged in a second superseding indictment returned today by a federal grand jury in New Orleans for defrauding GSL of over $1 million, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.
The 32-count indictment returned today in U.S. District Court in New Orleans charges Titus and Fazzio with conspiracy, mail fraud, wire fraud, money laundering and tax charges for participating in the fraud scheme. Fazzio has also been charged with a separate tax fraud scheme.
According to the second superseding indictment, between approximately May 2008 and approximately May 2011, Titus and Fazzio defrauded GSL, a construction management company based in Pascagoula, Miss., by creating and submitting fraudulent invoices for services never rendered on construction projects managed by GSL, causing payments to be made from GSL to two companies owned by Fazzio. The two defendants then allegedly laundered the money by engaging in a series of financial transactions for the purpose of concealing the illegal nature of the payments. According to the second superseding indictment, Titus and Fazzio also submitted false tax returns by improperly deducting the disbursement of their fraudulently obtained money as legitimate business activity and failing to report the money received from the fraud scheme as taxable income.
In addition, Fazzio is charged in connection with a tax fraud scheme perpetrated with Hendrikus Ton, the owner of Abe’s Boat Rentals in Belle Chase, La., and two other companies that provide services to offshore oil production facilities. Fazzio and Ton allegedly conspired to under-report income paid to employees of Ton’s by transferring taxable income from Abe's Boat Rentals to a dormant company, improperly deducting that money as legitimate business activity and using that money to pay employees of Abe’s Boat Rentals in order to conceal the actual amount of income paid to the employees, thereby reducing the tax liability of Ton’s companies by over $3.5 million. According to the second superseding indictment, Fazzio prepared the tax returns for Ton’s companies and willfully omitted wages paid out of the dormant company.
In October 2011, Titus pleaded guilty to one count of conspiracy to commit mail fraud, arising from his role in a fraud scheme allegedly related to the scheme set forth in the second superseding indictment returned today. Last month, Titus moved to withdraw his October 2011 guilty plea, but the request was denied yesterday by U.S. District Judge Ivan Lemelle in the Eastern District of Louisiana, and sentencing proceeded yesterday as scheduled. U.S. District Judge Lemelle sentenced Titus yesterday to 60 months in prison on his guilty plea. Judge Lemelle also sentenced Titus to pay a $100,000 fine and ordered Titus to pay $925,320 in restitution to GSL.
An indictment is merely a charge and is not evidence of guilt. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.The case is being prosecuted by Deputy Chief Peter Koski and Trial Attorneys Brian Lichter and Menaka Kalaskar of the Criminal Division’s Public Integrity Section, as well as Assistant U.S. Attorney Gregory Kennedy of the Eastern District of Louisiana. The case is being investigated by the FBI and the New Orleans Office of the Internal Revenue Service-Criminal Investigation Division.
Former Bryan County, Okla., Sheriff’s Office Lieutenant Sentenced for Assaulting Detainee with a TaserRead the Press Release
The Justice Department announced today that former Bryan County, Okla., Sheriff’s Office Lieutenant Kevin Bennett Holt, 48, from Achille, Okla., was sentenced to 18 months in the custody of the Federal Bureau of Prisons, followed by 24 months of supervised release, for using a Taser to assault a detainee inside of the Bryan County Jail in Durant, Okla., in violation of the victim’s civil rights.
The defendant pleaded guilty on May 1, 2012. During the plea hearing and in the plea documents, Holt admitted that he intentionally used unreasonable force on a detainee when he electronically shocked the detainee by using a Taser device while the detainee was strapped into a restraint chair. The defendant also admitted that his unlawful Taser deployment injured the victim.
“Excessive force by officers sworn to respect and uphold the law undermines our criminal justice system,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The federal government is committed to prosecuting officers who abuse the authority entrusted to them.”
This case was investigated by the FBI. The case was prosecuted by Trial Attorney Nicole Lee Ndumele of the Civil Rights Division and Assistant U.S. Attorney Gregory Dean Burris from the U.S. Attorney’s Office for the Eastern District of Oklahoma.
Wednesday 10 October 2012
Two U.S. Contractor Employees Sentenced for Kickback Conspiracy and Tax Crimes Related to Iraq Reconstruction EffortsRead the Press Release
WASHINGTON – Two former employees of The Parsons Company, an international engineering and construction firm, were sentenced in federal court in the Northern District of Alabama for their participation in a kickback conspiracy in Iraq and related tax crimes, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney for the Northern District of Alabama Joyce White Vance.
Billy Joe Hunt, 57, was sentenced today by U.S. District Judge Abdul Kallon in federal court in Huntsville, Ala., to 15 months in prison, three years of supervised release, $66,212 in restitution to the Internal Revenue Service (IRS) and forfeiture of $236,472. Gaines R. Newell Jr., 53, was sentenced yesterday by U.S. District Judge Virginia Hopkins in federal court in Birmingham, Ala., to 27 months in prison, three years of supervised release, $1,102,115 in restitution ($861,027 to the U.S. Army Corps of Engineers and $241,088 to the IRS) and forfeiture of $861,027.
On May 8, 2012, Hunt pleaded guilty to one count of conspiracy to commit mail and wire fraud and pay kickbacks, and one count of subscribing a false tax return. On April 10, 2012, Newell pleaded guilty to one count of conspiracy to commit mail and wire fraud and to pay kickbacks, and one count of subscribing a false tax return.
According to court documents, Newell and Hunt were employed by Parsons in Iraq as program manager and deputy program manager, respectively, under a contract that Parsons held to support the Coalition Munitions Clearance Program operated by the U.S. Army Corps of Engineers in Huntsville. The Coalition Munitions Program sought to preclude insurgents and other unfriendly groups from getting munitions that had been stockpiled, abandoned or seized, and using them against Coalition forces or the Iraqi public. In their plea proceedings, Newell and Hunt admitted taking over $1 million in kickbacks from subcontractors from 2005 to 2007, in return for arranging to award contracts on the munitions clearance program to subcontractors. Newell and Hunt also admitted filing false federal income tax returns by not disclosing kickback income.On May 21, 2012, Hunt and Newell’s co-conspirator Ahmed Sarchil Kazzaz, 45, pleaded guilty for his role in the scheme. Kazzaz and his business, Leadstay Company, were indicted in the Northern District of Alabama in September 2011 for paying over $947,000 in kickbacks to Newell and Hunt. According to the plea agreement, between March 2006 and June 2007, Kazzaz agreed to pay kickbacks to Newell and Hunt totaling 13 percent of the amounts paid by Parsons, and thus obtained over $23 million in subcontracts providing materials and equipment to Parsons. After Kazzaz’s arrest in Los Angeles on Dec. 2, 2011, this case was transferred to the Central District of California, where Kazzaz pleaded guilty. His sentencing is set for Oct. 29, 2012 before U.S. District Judge R. Gary Klausner in the Central District of California.
The cases are being prosecuted by Catherine Votaw, Director of Procurement Fraud for the Criminal Division’s Fraud Section, and Assistant U.S. Attorney David Estes of the Northern District of Alabama. The investigation was handled by the Special Inspector General for Iraq Reconstruction, the Defense Criminal Investigative Service, the IRS-Criminal Investigations Division and the FBI.
Ten Individuals Indicted in National Business Opportunity Fraud ScamRead the Press Release
The Justice Department announced today the unsealing of an indictment charging 10 individuals in connection with a vending machine “business opportunity” that defrauded thousands of victims across the country.
The indictment alleges that managers, sales representatives and operators of “locating companies” associated with Multivend LLC, d/b/a Vendstar, made material misrepresentations about the profits customers would make from and the locations customers would receive for bulk candy vending machines. The indictment also alleges that, during these telemarketing calls, Vendstar’s sales representatives falsely claimed to operate their own profitable vending machine businesses.
According to the indictment, Vendstar advertised nationwide in newspapers and on the Internet. Vendstar sales representatives promised to provide consumers with everything they needed to operate a successful business, including vending machines, an initial supply of candy, assistance in finding locations for the vending machines, training and ongoing customer assistance. The locating companies who worked with Vendstar to close deals had no special skills, tools or expertise in finding locations and generally placed consumers’ machines wherever they could as quickly as they could, often in businesses that had not consented to housing the machines and that soon demanded that the machines be removed. The vending machines generated little business and Vendstar’s customers lost nearly all if not all of their investments. The typical customer paid about $10,000 for the business opportunity.
“Business opportunity fraud is a serious crime that insidiously targets Americans in search of a better future for their families. We will continue to work with the Postal Inspection Service and use our law enforcement resources to investigate and uncover business opportunity fraud,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division, which includes the Consumer Protection Branch that handles criminal cases.
Tony Gomez, Acting Inspector in Charge, U.S. Postal Inspection Service - Miami Division, stated: “The U.S. Postal Inspection Service will continue to work with our partners in law enforcement to ensure that the U.S. Postal Service isn’t used as a conduit to defrauding the American consumer. The protection of our citizens is at the cornerstone of our mission.”
“Business opportunity schemes, like this candy vending machine venture, take advantage of individuals through misrepresentations and outright fraud,” said Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida. “Instead of becoming successful entrepreneurs, the individual investors become victims of fraud, often losing their life’s savings. In this way, business opportunity schemes tarnish the American Dream of success through hard work. We will help protect the investing public by prosecuting these cases aggressively.”
Vendstar was incorporated in Indiana and operated until July 2010 from Deer Park, N.Y., according to the indictment. The indictment was returned by a federal grand jury in Miami. The charges are part of a continuing crackdown by federal authorities on business opportunity fraud that during the last several years has resulted in more than 100 convictions in the Southern District of Florida alone.
Named as defendants in the indictment were:
- Edward Morris “Ned” Weaver, 39, of Perrysburg, Ohio, the president and chief executive officer of Vendstar.
- Lawrence A. Kaplan, 54, of Brooklyn, N.Y., the technical support manager for Vendstar.
- Scott M. Doumas, 40, of East Setauket, N.Y., a salesman and sales manager at Vendstar.
- Mark Benowitz, 65, of Holtsville, N.Y., a salesman at Vendstar.
- Richard R. Goldberg, 40, of Bay Shore, N.Y. a salesman at Vendstar.
- Richard Linick, 70, of Coram, N.Y., a salesman at Vendstar.
- Paul E. Raia, 61, of Brookhaven, N.Y., a salesman at Vendstar.
- Howard S. Strauss, 63, of Jericho, N.Y., a salesman at Vendstar.
- Wallace W. DiRenzo, 67, of Cleveland, Ohio, who operated Nationwide Locating Company, which was based in North Palm Beach, Fla.
- James P. Ellis, 42, of Northport, Ala., who operated Vending Dreams, Priority Placements, Clear Vision Marketing, Map Marketing and Secure Placement.
Each of the defendants is charged with conspiracy to commit mail and wire fraud, and an enhanced penalty for telemarketing , which together provide for a maximum sentence of 10 years in prison. Weaver, Kaplan, Benowitz, Goldberg, Linick, Raia, Strauss and DiRenzo also are charged with mail fraud, and/or wire fraud, each of which carry a maximum of 20 years in prison.
The indictment contains only accusations against the defendants and is not evidence of guilt. The defendants should be presumed innocent unless and until proven guilty.
Acting Assistant Attorney General Delery commended the investigative efforts of the United States Postal Inspection Service. The case is being prosecuted by Patrick Jasperse and Adrienne Fowler, Trial Attorneys, U.S. Department of Justice, Consumer Protection Branch.
Justice Department Settles Lawsuit Against Las Vegas Casino for Unfair Documentary PracticesRead the Press Release
The Justice Department today reached an agreement with Tuscany Hotel and Casino LLC in Las Vegas resolving a lawsuit alleging that the company discriminated in the employment eligibility verification and re-verification process. The Immigration and Nationality Act (INA) requires employers to treat all authorized workers equally during the hiring, firing and employment eligibility verification process, regardless of their national origin or citizenship status.
The department’s case, filed on May 11, 2012, alleged that Tuscany treated non-citizens differently from U.S. citizens during the employment eligibility verification and reverification process. The complaint alleged the casino required non-citizen employees to provide more or different documents or information than it required from citizen employees during the initial employment eligibility verification process. According to the complaint, the company then used the documents or information it gathered to impose improper document requests on non-citizens during the reverification process as a condition of continued employment. The complaint further alleged that the casino subjected non-citizen employees’ documents to a heightened review process by senior human resources representatives that was not applied to documents presented by U.S. citizens.
Under the settlement agreement, Tuscany will pay $49,000 in civil penalties to the United States and full back pay to a victim. In addition to corrective action already taken, Tuscany also agrees to implement new employment eligibility verification policies and procedures that treat all employees equally regardless of citizenship status, conduct training of its human resources staff on their responsibilities to avoid discrimination in the employment eligibility verification process, and be subject to reporting and monitoring requirements.
“Employers may not treat authorized workers differently during the employment eligibility verification and reverification process based on their citizenship status or national origin,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “ I am pleased that Tuscany Hotel and Casino has worked cooperatively with the department to reach an amicable resolution, and encourage the casino industry to include the anti-discrimination provision of the INA as an integral part of part of their statutory and regulatory compliance program.”
The Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) is responsible for enforcing the anti-discrimination provision of the INA, which protects work authorized individuals from employment discrimination on the basis of citizenship status or national origin, including discrimination in hiring, firing and the employment eligibility verification (Form I-9) process. For more information about protections against employment discrimination under federal immigration law, call the OSC’s worker hotline at 1-800-255-7688 (TDD 1-800-237-2525), the OSC’s employer hotline at 1-800-255-8155 (TDD 1-800-362-2735), sign up for a no-cost webinar at www.justice.gov/crt/about/osc/webinars.php or visit OSC’s website at www.justice.gov/crt/about/osc .