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Thursday 29 March 2012
Federal Court Permanently Bars San Diego Accountant from Preparing Tax Returns That Understate IncomeRead the Press Release
A federal court has permanently barred Robert Jensen, a certified public accountant from San Diego, from providing tax advice or preparing federal tax returns that illegally attempt to reduce customers’ taxable income, the Justice Department announced today.
The civil injunction order, to which Jensen agreed without admitting the government’s allegations, prevents Jensen from preparing tax returns that improperly deduct the personal expenses of customers or that attempt to reduce a customer’s taxable income through the unlawful use of pension plans, stock ownership plans or retirement plans. The order also bars Jensen from providing tax advice to, or preparing the federal tax returns of, any individual or entity that Jensen knows is a customer of co-defendant Scott Waage.
The government complaint in the case alleged that Jensen worked with Waage, a San Diego tax lawyer, to help clients evade income taxes and illegally circumvent pension plan rules. According to the civil injunction suit, Waage promoted schemes that helped customers evade taxes through the use of bogus deductions, while Jensen prepared the customers’ tax returns claiming the bogus deductions. The government alleged that the IRS audited more than1,000 tax returns as a result of the pair’s alleged tax schemes, and it estimated that the harm to the U.S. Treasury from the schemes exceeded $10.8 million. The civil injunction case against Waage remains pending.
In the past decade, the Justice Department’s Tax Division has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department website .
Related Documents:
Stipulated Order and Judgment of Permanent Injunction (Robert O. Jensen) (PDF)Detroit Medical Clinic Owner Pleads Guilty to Medicare Fraud SchemeRead the Press Release
WASHINGTON – The owner of a Detroit medical clinic pleaded guilty today for his participation in a Medicare fraud scheme, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).
Juan Villa, 29, of Miami, pleaded guilty before U.S. District Judge Arthur J. Tarnow in the Eastern District of Michigan to one count of conspiracy to commit health care fraud. At sentencing, Villa faces a maximum penalty of 10 years in prison and a $250,000 fine.
According to the plea documents, Villa owned Blessed Medical Clinic in Livonia, Mich. Villa admitted that he hired patient recruiters who paid cash bribes to Medicare beneficiaries to attend the clinic and provide their Medicare numbers and other information. Villa admitted that he used the beneficiary information to bill for medically unnecessary diagnostic tests and treatments. According to court documents, Blessed Medical Clinic fraudulently billed Medicare $2.4 million during the course of the scheme.
Today’s guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (OIG) Chicago Regional Office.
This case is being prosecuted by Assistant U.S. Attorneys Frances Lee Carlson and Philip A. Ross of the Eastern District of Michigan, with assistance from Assistant Chief Gejaa T. Gobena 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 Eastern District of Michigan.
Since their inception in March 2007, the Medicare Fraud Strike Force operations in nine locations have charged more than 1,190 individuals who collectively have falsely billed the Medicare program for more than $3.6 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the 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.
Wednesday 28 March 2012
Shipbuilder and Ship Engine Manufacturer Agree to Pay Civil Penalty and Perform Environmental Project to Resolve Clean Air Act ViolationsRead the Press Release
WASHINGTON – Coltec Industries Inc. and National Steel and Shipbuilding Company (NASSCO) have agreed to pay a civil penalty of $280,000 and spend approximately $500,000 on an environmental project to resolve alleged violations of the Clean Air Act (CAA) and EPA’s marine diesel engine air rules, the Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today. The project will significantly reduce nitrogen oxide emissions from a testing stack at Coltec’s Beloit, Wis., engine manufacturing facility, improving air quality for residents. Coltec and NASSCO also agreed to attach the required EPA engine labels to 40 ship engines that were previously unlabeled or improperly labeled.
“This is the first time a settlement addresses Clean Air Act violations in the marine engine manufacturing and ship building industries. Under the settlement, Coltec and NASSCO will pay a just penalty and achieve compliance with the nation’s Clean Air Act and EPA’s emissions control regulations,” said Ignacia S. Moreno, Assistant Attorney General for the Environment and Natural Resources Division. “Compliance with the Clean Air Act by all industries is essential to preventing harmful pollutants from being released into the environment, whether on land or at sea.”
“EPA is committed to enforcing the Clean Air Act’s standards for engines, including ship engines,” said Cynthia Giles, Assistant Administrator for EPA’s Office of Enforcement and Compliance Assurance. “By ensuring that engines meet requirements and encouraging environmental projects that benefit nearby communities, we are making the air cleaner and healthier for the residents of southern Wisconsin.”The CAA prohibits marine diesel engines from being sold in the U.S. unless the engines are covered by a certificate of conformity and have an EPA label indicating that the engine meets applicable emission standards. Engines that are not certified may be operating without proper emissions controls and emitting excess carbon monoxide and nitrogen oxides. These excess emissions can cause respiratory illnesses, aggravate asthma and contribute to the formation of ground level ozone or smog.
On Sep. 30, 2010, the United States filed a complaint which alleged that Coltec violated the CAA by manufacturing and selling 32 marine diesel engines that were not covered by an EPA-issued certificate of conformity and that NASSCO violated the CAA by installing those engines in ships that NASSCO built and sold to the U.S. Navy. The complaint also alleged that the 32 uncertified Coltec engines, plus eight more certified engines Coltec sold to NASSCO, had missing or improper emissions compliance labels required by EPA’s regulations. Finally, the complaint alleged that NASSCO further violated the CAA by manufacturing and selling ships containing an additional six uncertified engines.
The settlement also includes a supplemental environmental project in which Coltec and NASSCO will install a nitrogen oxide (NOx) control system to an engine test stand exhaust stack connected to Coltec’s Beloit engine manufacturing facility. The engine test stand is used for testing large marine diesel engines that are manufactured and sold by Coltec for use in U.S. Navy ships. The NOx controls required by the settlement are estimated to reduce levels of NOx by at least 85 percent, from approximately 102 pounds emitted per hour to approximately 16 pounds per hour. The estimated cost to implement the project is $500,000 and will benefit the city of Beloit by improving air quality near the facility, particularly in the adjacent Merrill neighborhood.
Coltec is a subsidiary of EnPro Industries Inc. and operates Fairbanks Morse Engine (FME), which supplies marine propulsion and ship service systems to the U.S. Navy and U.S. Coast Guard.
NASSCO is a subsidiary of General Dynamics. NASSCO designs and builds support ships, oil tankers and dry cargo carriers for the U.S. Navy and commercial markets.
The consent decree, lodged in the U.S. District Court for the District of Columbia, is subject to a 30-day public comment period and court approval.
For more information on the settlement, visit: www.epa.gov/compliance/resources/cases/civil/caa/coltec.html.
Residential Youth Treatment Facility for Medicaid Recipients in Marion, Virginia Agrees to Resolve False Claims Act AllegationsRead the Press Release
Universal Health Services Inc. (UHS) and two subsidiaries have reached a settlement in a False Claims Act lawsuit with the United States and the Commonwealth of Virginia, the Justice Department announced today. Under the settlement, UHS and its subsidiaries, Keystone Education and Youth Services LLC and Keystone Marion LLC, which did business as the Keystone Marion Youth Center, a residential facility in Marion, Va., agreed to pay $6.85 million to the United States and the commonwealth to settle allegations that they provided substandard psychiatric counseling and treatment to adolescents in violation of Medicaid requirements, falsified records and submitted false claims to the Medicaid program. UHS closed the Marion facility earlier this year.
This settlement resolves a whistleblower lawsuit filed by Megan Johnson, Leslie Webb and Kimberly Stafford-Payne, former therapists at the closed facility. UHS and its subsidiaries have paid an additional amount under the terms of the agreement to the former therapists to settle their separate discrimination and attorney’s fees claims. The United States and the Commonwealth of Virginia had intervened in the lawsuit on Nov. 4, 2009.
Under the False Claims Act, an entity that submits false or fraudulent claims to the government is liable for three times the government’s damages, plus a civil penalty for each false claim. The claims settled by this agreement are allegations only; there has been no determination of liability.
“The Justice Department is committed to investigating cases in which health care providers have put patients at risk by failing to meet the appropriate standards of care,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division. “Today’s settlement demonstrates our commitment to protecting the integrity of the Medicaid program and making sure that patients who rely on federal health programs receive the care they deserve.”
“This settlement resolves disturbing allegations that Universal Health Services Inc. and its subsidiaries in Virginia made false records and presented false claims to Virginia Medicaid in connection with sub-standard care to emotionally troubled youth at a residential treatment facility in Marion, Virginia,” said Timothy J. Heaphy, U.S. Attorney for the Western District of Virginia. “This result, which provides substantial reimbursement to the Virginia Medicaid program, demonstrates our strong partnership with the Virginia Attorney General’s Medicaid Fraud Control Unit and our commitment to use all available means, including civil remedies under the False Claims Act, to combat health care fraud.”
“Any organization providing substandard health services then sending inflated bills to taxpayers, as UHS is alleged to have done, can expect intense scrutiny by government investigators,” said Daniel R. Levinson, Inspector General of the Department of Health and Human Services. “Those intent on defrauding our programs should know that we will continue to work closely with State law enforcement agencies to fight Medicaid fraud.”
“This settlement, which returns a substantial sum to the Virginia Medicaid program, is a testament to the strength of such a collaborative partnership,” said Ken Cuccinelli, Virginia Attorney General. “This case sends a clear message that fraud and exploitation of our most vulnerable citizens will not be tolerated in the commonwealth.”
Acting Assistant Attorney General Delery acknowledged the efforts made by the U.S. Attorney’s Office for the Western District of Virginia, the Virginia Attorney General’s office, the Civil Division of the Justice Department, the Department of Health and Human Services’ Office of the Inspector General and the Commonwealth of Virginia’s Medicaid Fraud Control Unit.
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 $6.7 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are more than $9 billion.
Mississippi Pharmaceutical Firm and CEO to Pay $2.8 Million to Resolve Allegations of Illegal Marketing of Unapproved DrugsRead the Press Release
Mississippi-based Cypress Pharmaceutical Inc., its subsidiary Hawthorn Pharmaceuticals Inc. and its CEO, Max Draughn, have agreed to pay $2.8 million to resolve civil allegations under the False Claims Act, the Justice Department announced today. The government alleged that between 2003 and 2009, Cypress, Hawthorn and Draughn were responsible for marketing three pharmaceutical products that were not approved as safe and effective by the Food and Drug Administration (FDA). The products were Hylira, a gel used for the treatment of dry skin, Zaclir, an acne treatment and Zacare, another acne treatment.
The government alleged that although the drugs lacked the “safe and effective” designation, Hawthorn’s sale representatives promoted the products to physicians and state Medicaid officials using that designation. This caused TRICARE, the military’s health care program, and state Medicaid programs to improperly pay for the three products. The government also alleged that Cypress, Hawthorn and Draughn caused the submission to the Centers for Medicare and Medicaid Services (CMS) of false quarterly reports that misrepresented these products’ regulatory status and failed to advise CMS that the drugs did not qualify as outpatient drugs that were covered for payment.
Medicaid is partially funded by the federal government. The federal portion of today’s settlement, including payments due to the TRICARE program, is $1,615,783. The state Medicaid share of the settlement is $1,184,217.
The settlement resolves a False Claims Act lawsuit filed in the Eastern District of Texas by Robert Heiden, a former district sales manager for Hawthorn. The whistleblower, or qui tam, provisions of the False Claims Act permit the relator to obtain a portion of the proceeds obtained by the federal government. As part of today’s resolution, Heiden will receive more than $300,000.
“The marketing and promotion of unapproved new drugs undermines the FDA’s important role in protecting the American public,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division. “This civil settlement demonstrates our continued commitment to protecting the integrity of the FDA’s regulatory process and ensuring that taxpayer dollars are spent appropriately.”
“Today’s settlement strips the defendants of money they should not have been paid and helps reimburse state and federal health care programs,” said John M. Bales, U.S. Attorney for the Eastern District of Texas.
“This settlement sends a strong message to those who seek to put the health of American patients at risk by marketing and promoting drugs which have not been approved by the FDA,” said Ilisa Bernstein, Acting Director of the Office of Compliance in FDA’s Center for Drug Evaluation and Research.
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 nearly $6.7 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $9 billion.
The claims settled by this agreement are allegations only; there has been no determination of liability.
Justice Department Sues National Tax Preparation Firm and Franchisees to Stop Alleged Pervasive Tax FraudRead the Press Release
The United States has filed civil injunction lawsuits in five cities seeking to shut down both the company that operates Instant Tax Service (ITS) as well as five owners of ITS franchises, the Justice Department announced today. According to government complaints filed in the cases, the franchising company ITS Financial LLC, headquartered in Dayton, operates what it claims is the nation’s fourth-largest tax-preparation business. In the complaints, the Justice Department accuses ITS Financial and its owner, Fesum Ogbazion, of deliberately ignoring systemic and pervasive fraud by ITS franchisees.
The complaints allege that ITS franchisees across the country intentionally prepare and file fraudulent tax returns to maximize their customers’ refunds. They do so, according to the complaints, so that ITS Financial and its franchisees can extract large tax preparation fees, as well as various charges that Ogbazion refers to as “junk fees,” directly from their customers’ refund checks. The government claims these fees are outrageously high – for example, up to $1,000 for preparing tax returns in as little as 15 minutes – and are often not disclosed to customers.
The franchisees named in the complaints allegedly invent phony businesses, fabricate deductions, falsify filing statuses, claim bogus dependents and disregard rules for claiming the earned income tax credit. The Justice Department alleges that ITS employees at these franchises have little tax preparation experience and that the franchise owners encourage them to prepare fraudulent tax returns or are aware that the employees do so. For example, one complaint alleges that David Franklin, who operates multiple ITS stores in Indianapolis, held a two-week training course in 2010 in which his employees were explicitly instructed to prepare fraudulent tax returns.
The complaint against ITS Financial states that the estimated tax losses from allegedly fraudulent return preparation in 2011 at ITS locations in St. Louis, Kansas City, Chicago, Indianapolis and Las Vegas exceed $16 million.
One of the government’s court filings quotes Ogbazion as allegedly saying that he intentionally does not track complaints of fraud made against his ITS franchisees because he “wouldn’t be able to sleep” at night.
“Hard-working Americans deserve to rest assured that their tax return preparers are not ripping them off,” said John A. DiCicco, Principal Deputy Assistant Attorney General of the Justice Department’s Tax Division. “Throughout this filing season, Justice Department attorneys and Internal Revenue Service agents have been tirelessly investigating cases of return preparer fraud. We will not hesitate to seek civil court orders and – where appropriate – criminal prosecution to halt and punish this type of wrongdoing.”
“It’s critical for the nation’s taxpayers to have full confidence in the tax professionals helping them. The IRS is committed to working with the Justice Department to protect taxpayers from unscrupulous tax preparers,” said Steven T. Miller, Internal Revenue Service (IRS) Deputy Commissioner of Services and Enforcement. “As the tax deadline approaches, the IRS reminds taxpayers to be on the lookout for dubious deals promising big refunds.”
According to the government complaints, the defendants in the injunction lawsuits lure their mostly low-income customers by offering loans that the government asserts are false and deceptive. The defendants allegedly encourage their customers to apply for loans knowing that certain customers do not meet the undisclosed criteria to qualify. The complaints state that when customers apply for these loans – usually before the tax filing season even begins – ITS prepares “estimate” returns based on the customers’ last paycheck stubs. Although customers allegedly believe they are merely applying for loans, the government asserts that ITS franchisees and return preparers routinely file tax returns without having customers’ Forms W-2 and without the customers’ authorization. The complaint against ITS Financial alleges that it encourages its franchisees to lie to the IRS about the company’s practice of filing returns without Forms W-2.
All of these actions, the government asserts, allow ITS Financial and its franchisees to extract exorbitant fees from customers’ tax refunds. The complaint against ITS Financial cites recent news reports from Indianapolis and Kansas City, among other cities, in which customers are reported to have complained that Instant Tax Service filed their tax returns without their permission and took out large, hidden fees from their refunds.
Over the past few years, the Justice Department has successfully criminally prosecuted four individual tax return preparers affiliated with ITS franchises in Ohio and Missouri.
The injunction lawsuits name the following individuals and companies as defendants:
1) Dayton: Fesum Ogbazion, TCA Financial LLC, ITS Financial LLC and Tax Tree LLC
According to the complaint, Ogbazion is the sole owner of TCA Financial , which is a holding company for ITS Financial and Tax Tree. ITS Financial is allegedly the franchisor of ITS franchises nationwide. The government alleges that Tax Tree finances false and deceptive loan products to ITS customers nationwide.
2) Chicago: Emanuel Ghebremichael and ERG Financial Corporation (dba Instant Tax Service)
According to the complaint, Ghebremichael is the sole shareholder of ERG Financial, which owns 16 ITS stores and kiosks in the Chicago area.
3) Indianapolis: David Ray Franklin Jr., Rachel Wiggins, William Brown and Instant Tax Refund Service (dba Instant Tax Service)
According to the complaint, Franklin and Wiggins are the president and chief financial officer, respectively, of Instant Tax Refund Service, and Brown manages one of the busiest of Franklin’s 22 ITS stores and kiosks in the Indianapolis area.
4) Las Vegas: Benyam Tewolde, Yordanos Kidane and Koraggio LLC (dba Instant Tax Service)
According to the complaint, Tewolde and Kidane are the husband-and-wife owners of Koraggio, which owns multiple ITS stores that prepared over 5,000 tax returns in 2011.
5) Kansas City, Kan.: Semere Tsehaye, Ahferom Goitom, A&S Tax Services LLC and ERI Enterprises LLC (dba Instant Tax Service)
According to the complaint, Tsehaye, the owner of A&S Tax Service and ERI Enterprises, operates one ITS store in Kansas City, Kan., and five stores in Kansas City, Mo., through A&S Tax Services. He also allegedly operates 14 ITS stores in St. Louis and East St. Louis, Ill., through ERI Enterprises. The complaint states that Goitom, who is Tsehaye’s brother, is the manager of one of Tsehaye’s ITS stores in Kansas City, Kan.
The IRS lists return preparer fraud as one of its “Dirty Dozen” tax scams for 2012. The IRS also offers tips to taxpayers for selecting a tax return preparer.
In the past 10 years, the Justice Department’s Tax Division has obtained hundreds of injunctions to stop the promotion of tax-fraud schemes and the preparation of fraudulent tax returns. Information about these cases is available on the Justice Department website.
United States v. David Ray Franklin, et al. Complaint for Permanent Injunction and Other Relief (PDF)
United States v. Benyam Tewolde, et al. Complaint for Permanent Injunction and Other Relief (PDF)
United States v. Emanuel R. Ghebremichael, et al. Complaint for Permanent Injunction and Other Relief (PDF)
United States v. Semere Tsehaye, et al. Complaint for Permanent Injunction and Other Relief (PDF)
United States v. Fesum Ogbazion, et al. Complaint for Permanent Injunction and Other Relief (PDF)
Justice Department Seeks to Shut Down Texas Tax Return PreparerRead the Press Release
The United States has sued tax preparer Joseph Rivas, seeking to bar him from preparing any federal tax returns for others, the Justice Department announced today. The civil injunction suit alleges that Rivas of DeSoto, Texas, claimed fraudulent deductions and expenses on his customers’ tax returns.
Rivas allegedly claimed fake mortgage interest deductions, illegally deducted social security taxes as state and local taxes and fabricated employee business expenses, among other fraudulent items, on his customers’ returns. According to the complaint, the harm to the United States from Rivas’s misconduct could be $7.8 million or more.
The government is also seeking a court order requiring Rivas to provide a list of all persons for whom he has prepared federal tax returns since Jan. 1, 2010.
The Internal Revenue Service lists return preparer fraud as one of the “Dirty Dozen” tax scams for 2012. In the past decade, the Justice Department’s Tax Division has obtained injunctions against hundreds of tax return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department website .
Complaint for Permanent Injunction and Other Relief (PDF)
Justice Department Resolves Allegations of Discrimination with Onward Healthcare in ConnecticutRead the Press Release
WASHINGTON – The Justice Department reached a settlement agreement today with Onward Healthcare, a healthcare staffing company based in Wilton, Conn., resolving allegations that the company posted discriminatory job advertisements on its home page and third party websites that limited its jobs to U.S. citizens.
According to the department’s investigation, over a one year period, thousands of Onward Healthcare’s job postings impermissibly limited applications to U.S. citizens, even though work-authorized immigrants, such as lawful permanent residents, asylees and refugees, should have been allowed to apply as well. The Immigration and Nationality Act (INA) generally prohibits employers from discriminating on the basis of citizenship status unless required by law, regulation or government contract. The department determined that the company had no legal basis for its stated citizenship preference.
“Federal law protects people who are authorized to work in the United States from facing discriminatory barriers when they are seeking employment,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “Employers should ensure that their online job postings do not violate the anti-discrimination provision of Immigration and Nationality Act.”Under the terms of the settlement agreement, the company has agreed to pay $100,000 in civil penalties, to change its internal policies and manuals to reflect the INA’s protections, and to be subject to reporting and compliance monitory requirements for a period of three years. This case was handled by Justice Department Attorney Liza Zamd.
The Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) is responsible for enforcing the anti-discrimination provisions of the INA, which protect U.S. citizens and certain work-authorized individuals from citizenship status discrimination. The INA also protects work-authorized individuals from national origin discrimination, over-documentation in the employment eligibility verification process and retaliation.For more information about protections against employment discrimination under the immigration laws, call 1-800-255-7688 (OSC’s worker hotline) (1-800-237-2525, TDD for hearing impaired), 1-800-255-8155 (OSC’s employer hotline) (1-800-362-2735, TDD for hearing impaired), sign up for a no-cost webinar at www.justice.gov/crt/about/osc/webinars.php, email [email protected] or visit the website at www.justice.gov/crt/about/osc/.
Honolulu Firearms Business Owner Sentenced to 51 Months in Prison for Federal Tax OffensesRead the Press Release
Arthur Lee Ong of Honolulu was sentenced Tuesday to 51 months in prison and ordered to pay $1 million in restitution to the Internal Revenue Service (IRS) by District Court Judge Leslie Kobayashi today, the Justice Department and IRS announced today. On Nov. 7, 2001, a federal jury in Honolulu convicted Ong of conspiracy to defraud the United States and six counts of tax evasion.
According to evidence introduced at trial, Ong, the owner and operator of Thunder Bug Inc., doing business in the state of Hawaii as Magnum Firearms, failed to report to the IRS millions of dollars of income he earned from the sale of firearms and related products to federal, state, county and military agencies, as well as to the general public. Ong, with the assistance of a Hawaiian attorney, created multiple sham trusts in 1990 for the purpose of hiding his income and assets. He stopped filing personal income tax returns beginning in 1994 and also filed false tax returns on behalf of the sham trusts that fraudulently reported to the IRS that the income from his businesses was attributable to these trusts and not to him.
The evidence at trial showed that Ong evaded more than $600,000 in federal income taxes from 2000 to 2006. In sentencing Ong, Judge Kobayashi found that Ong had attempted to evade more than $973,300 in federal and state income taxes from 1994 to 2009.
“There are some responsibilities that come with living in this great country, such as paying the federal income taxes that you legally owe,” said Kenneth J. Hines, the IRS Special Agent in Charge in Hawaii. “With Tax Dayright around the corner, this sentence sends a clear warning to anyone contemplating a tax crime.”
The case resulted from an investigation by IRS - Criminal Investigation and was prosecuted by Trial Attorneys Timothy J. Stockwell and Todd P. Kostyshak of the Justice Department’s Tax Division.
Four Additional Defendants Charged for Assaulting Practitioners of the Amish Religion in ClevelandRead the Press Release
WASHINGTON – The Justice Department announced today that a federal grand jury in Cleveland returned a 10-count superseding indictment in United States v. Mullet, et al. The superseding indictment charges 10 men and six women, all residents of Ohio, with federal crimes arising out of a series of religiously-motivated assaults on practitioners of the Amish religion.
The superseding indictment addresses five separate assaults that occurred between September and November of 2011, and obstructive conduct related to those assaults. In each assault, defendants forcibly removed beard and head hair from practitioners of the Amish faith with whom they had ongoing religious disputes. As set forth in the superseding indictment, the manner in which Amish men wear their beards and Amish women wear their hair are symbols of their faith. The superseding indictment adds four defendants, Lovina Miller, Kathryn Miller, Emma Miller and Elizabeth Miller, who had not previously been charged. The indictment also adds charges against some of the defendants for the concealment and destruction of evidence, including a disposable camera, shears and a bag of hair from victims of the attacks, as well as a charge against Samuel Mullet Sr., for false statements he allegedly made to federal agents during the investigation.
This case is being investigated by the Cleveland Division of the FBI and is being prosecuted by Assistant U.S. Attorneys Thomas Getz and Bridget M. Brennan of the U.S. Attorney’s Office for the Northern District of Ohio and Deputy Chief Kristy Parker of the Civil Rights Division’s Criminal Section. For more information on the 12 defendants previously charged in this case, please visit www.justice.gov/opa/pr/2011/December/11-crt-1683.html.
An indictment is merely an accusation. All defendants are presumed innocent of the charges until proven guilty beyond a reasonable doubt in court.
Former Grant Administrator and Legal Assistant of American Samoa Non-profit Legal Aid Corporation Sentenced for Stealing Nearly $160,000 in Federal Grant FundsRead the Press Release
WASHINGTON – Julie Matau, 49, and her daughter, Andrea Matau, 28, each were sentenced yesterday in Oakland, Calif., for their participation in the theft of nearly $160,000 in federal grant funds from a now-defunct nonprofit American Samoa legal services corporation, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.
U.S. District Judge Claudia Wilken for the Northern District of California sentenced Julie Matau to 12 months and one day in prison. Julie Matau also was ordered to serve three years of supervised release, including eight hours a week of community service throughout the three-year term. Judge Wilken sentenced Andrea Matau to serve 12 months of probation, including six months of home detention. Andrea Matau also was ordered to provide eight hours a week of community service for the entire 12 months of probation. Judge Wilken ordered Julie and Andrea Matau to pay $159,763 in restitution, to be paid jointly and severally. In addition, Judge Wilken ordered that $31,292 of the $159,763 be paid jointly and severally with David Wagner, another individual who has pleaded guilty for his role in the scheme, if he is ordered to pay restitution in that amount. Wagner’s sentencing is scheduled for April 2, 2012, in St. Louis before U.S. District Judge Carol E. Jackson for the Eastern District of Missouri.
On Dec. 21, 2011, Julie Matau pleaded guilty to wire fraud and Andrea Matau pleaded guilty to misdemeanor theft of federal funds. A federal grand jury in the Northern District of California returned an indictment against Julie and Andrea Matau on Dec. 16, 2010. Wagner pleaded guilty on March 11, 2010, in the Eastern District of Missouri for his role in the theft of federal funds.
The case arose from allegations of theft and fraud at a now-defunct nonprofit legal services corporation in American Samoa called the U’una’i Legal Services Corporation (ULSC). According to court documents, between 1998 and 2007, ULSC was the only nonprofit organization in American Samoa that was dedicated to providing free legal services to victims of domestic violence, dating violence, stalking and sexual abuse.
Between August 2005 and September 2007, ULSC received more than $1.2 million in federal grant funds from the U.S. Department of Justice’s Office of Violence Against Women and the Legal Services Corporation.
According to court documents, between May 2005 and September 2007, Wagner served as ULSC’s acting executive director and Julie Matau served as ULSC’s office manager and grant administrator. Julie Matau, together with Wagner, was responsible for submitting applications for federal grant funding, managing ULSC’s federal funds and issuing employee payroll checks. Wagner and Julie Matau exercised joint signatory authority over ULSC’s bank accounts. Andrea Matau worked as one of ULSC’s legal assistants and reported directly to Julie Matau.
According to court documents, between September 2005 and September 2007, Julie Matau and Wagner arranged for themselves, Andrea Matau, and Julie and Andrea Matau’s relatives to receive unlawful payments from the federal grant funds. According to court documents, Julie Matau unlawfully received $65,649 in federal grant funds; Andrea Matau unlawfully received $24,634 in federal grant funds; Wagner unlawfully received $31,292 in federal grant funds; and the Mataus’ relatives received $38,188 in federal grant funds.
In her guilty plea, Julie Matau admitted that she knew that they had no legal entitlement to receive these federal grant funds and that their receipt of the federal funds violated the terms and conditions of the grants. Julie Matau also admitted that she had no intention of repaying the money to ULSC or the federal government, or of requiring others to repay the money. In her guilty plea, Andrea Matau admitted that she participated in the theft by personally receiving $24,634 in unlawful payments and by permitting Julie Matau to deposit additional unlawful payments in Andrea Matau’s personal bank account and in their joint bank account.
In his guilty plea, Wagner admitted that, with Julie Matau’s assistance, he received a number of unlawful “salary advances.” Wagner also admitted that he signed blank ULSC checks for Julie Matau’s use in exchange for the unlawful payments that she provided to him.
The case is being prosecuted by Trial Attorneys Edward J. Loya Jr. and Monique T. Abrishami of the Criminal Division’s Public Integrity Section. Senior Trial Attorney Mary K. Butler and Trial Attorney Maria N. Lerner, also of the Public Integrity Section, participated in the investigation of this matter. The case is being investigated by special agents of the Department of Justice’s Office of the Inspector General and the Legal Services Corporation’s Office of Inspector General, with assistance from special agents of the FBI-Honolulu Division, American Samoa Resident Agency.
Antitrust Division Issues 2012 Edition of Its Annual NewsletterRead the Press Release
The Department of Justice’s Antitrust Division today issued the 2012 edition of its annual newsletter on its website. The newsletter highlights recent activities and successes on civil and criminal enforcement, international cooperation and competition advocacy of the Antitrust Division for the general public as well as the legal and business communities.
The newsletter includes a message from Acting Assistant Attorney General Sharis A. Pozen as well as articles about the Antitrust Division’s enforcement actions in civil and criminal enforcement, international cooperation and competition advocacy over the past year. The newsletter highlights the division’s accomplishments, including the ongoing auto parts investigation, which thus far has resulted in nearly $750 million in criminal fines and several executives agreeing to serve significant prison sentences. Additional highlights include the division's success in preventing anticompetitive mergers in the technology and telecommunications industries and in preserving competition in a variety of important industries, including health care and agriculture by requiring the right remedy for each matter.
The newsletter also features articles about the leadership of the Economic Analysis Group, the Directors of Enforcement, enhanced litigation capabilities and the Attorney General’s Honors Program.
The newsletter can be found at www.justice.gov/atr/public/division-update/2012. Within each article, hyperlinks are provided so that the reader can easily access relevant documents such as press releases, court filings and speeches.
Tuesday 27 March 2012
Witness in Identity Theft and Tax Trial Convicted of Perjury and Lying to a Federal AgentRead the Press Release
A federal jury in Montgomery, Ala., convicted Nacretia Lewis today of perjury and lying to a federal agent, the Justice Department and the Internal Revenue Service (IRS) announced.
According to the indictment and evidence introduced at trial, Lewis testified falsely in September 2011 in a tax fraud trial in the Middle District of Alabama. The defense in the tax fraud trial presented an alibi defense regarding the whereabouts of the defendant on trial on Jan. 20, 2011. Lewis was convicted of lying about being with Janika Fernae Bates at a place other than NCO Financial Systems Inc., their workplace, at precisely the same time witnesses at trial placed Bates at NCO. The evidence showed that after her testimony, Lewis met with federal agents and again lied about her whereabouts and Bates’ whereabouts on January 20, 2011. After a five-day trial, Bates was convicted of thirteen felony counts and sentenced to 94 months in federal prison.
Lewis faces a potential maximum sentence of ten years in federal prison and a fine of up to $500,000.
The case was investigated by Special Agents of the IRS-Criminal Investigation. Trial Attorneys Justin Gelfand and Jason Poole of the Justice Department’s Tax Division are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
New York Financial Investor Pleads Guilty to Bid Rigging at Municipal Tax Lien Auctions in New JerseyRead the Press Release
A financial investor who purchased municipal tax liens at auctions in New Jersey pleaded guilty today for his role in a conspiracy to rig bids for the sale of tax liens auctioned by municipalities throughout the state, the Department of Justice announced.
A felony charge was filed today in the U.S. District Court for the District of New Jersey in Newark, N.J., against Robert E. Rothman of New York. Under the plea agreement, which is subject to court approval, Rothman has agreed to cooperate with the department’s ongoing investigation.
According to the felony charge, from in or about the spring of 2000 until approximately February 2009, Rothman participated in a conspiracy to rig bids at auctions for the sale of municipal tax liens in New Jersey by agreeing to allocate among certain bidders on which liens to bid. The department said that Rothman proceeded to submit bids in accordance with his agreement and purchased tax liens at collusive and non-competitive interest rates.
“The Antitrust Division’s investigation into municipal tax lien auctions is ongoing and active,” said Sharis A. Pozen, Acting Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “The division will not tolerate this kind of illegal conduct that harms distressed homeowners.”
The department said that the primary purpose of the conspiracy was to suppress and restrain competition to obtain selected municipal tax liens offered at public auctions at non-competitive interest rates. When the owner of real property fails to pay taxes on that property, the municipality in which the property is located may attach a lien for the amount of the unpaid taxes. If the taxes remain unpaid after a waiting period, the lien may be sold at auction. State law requires that investors bid on the interest rate delinquent homeowners will pay upon redemption. By law, the bid opens at 18 percent interest and, through a competitive bidding process, can be driven down to zero percent. If a lien remains unpaid after a certain period of time, the investor who purchased the lien may begin foreclosure proceedings against the property to which the lien is attached.
According to the court documents, Rothman conspired with others not to bid against one another at municipal tax lien auctions in New Jersey. Since the conspiracy permitted the conspirators to purchase tax liens with limited competition, each conspirator was able to obtain liens which earned a higher interest rate. Property owners were therefore made to pay higher interest on their tax debts than they would have paid had their liens been purchased in open and honest competition.
A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine for a Sherman Act violation may be increased to twice the gain derived from the crime or twice the loss suffered by the victim if either amount is greater than the statutory maximum.
Rothman is the sixth individual to plead guilty as a result of the ongoing investigation into bid rigging or fraud related to municipal tax lien auctions. On Aug. 24, 2011, Isadore H. May, Richard J. Pisciotta Jr. and William A. Collins each pleaded guilty to one count of bid rigging in connection with their participation in a conspiracy to allocate liens at New Jersey auctions. On Feb. 23, 2012, Robert W. Stein and David M. Farber each pleaded guilty to one count of bid rigging in connection with their participation in this conspiracy.
Today’s charge is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force (FFETF). President Obama established the interagency FFETF to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov.
The ongoing investigation is being conducted by the Antitrust Division’s New York Field Office and the FBI’s Atlantic City, N.J., office. Anyone with information concerning bid rigging or fraud related to municipal tax lien auctions should contact the Antitrust Division’s New York Field Office at 212-335-8000, visit www.justice.gov/atr/contact/newcase.htm or contact the FBI’s Atlantic City Resident Agency at 609-677-6400.
Justice Department Requires Divestitures in Humana Inc.'s Acquisition of Arcadian Management Services Inc.Read the Press Release
WASHINGTON — The Department of Justice today announced that it will require Humana Inc. and Arcadian Management Services Inc. to divest assets relating to Arcadian’s Medicare Advantage business in parts of five states in order for Humana to proceed with its acquisition of Arcadian. The department is requiring divestitures of health plans in 51 counties and parishes in Arizona, Arkansas, Louisiana, Oklahoma and Texas. The department said that the transaction, as originally proposed, would likely have resulted in higher prices, fewer choices and lower quality Medicare Advantage plans purchased by Medicare beneficiaries.
The department’s Antitrust Division filed a civil lawsuit today in the U.S. District Court in Washington, D.C., to block the proposed acquisition. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the lawsuit and the department’s competitive concerns.
“Protecting competition in health care has been and continues to be a top priority of the Antitrust Division,” said Acting Assistant Attorney General Sharis A. Pozen in charge of the Department of Justice’s Antitrust Division. “These divestitures preserve competition so that Medicare beneficiaries, primarily senior citizens, in Arizona, Arkansas, Louisiana, Oklahoma and Texas, benefit from lower prices, better quality services and more innovative products for their health care needs.”
Individuals eligible for Medicare, primarily senior citizens, may elect to enroll in a privately provided Medicare Advantage plan instead of traditional Medicare. In establishing the Medicare Advantage program, Congress intended that vigorous competition among private Medicare Advantage insurers would lead insurers to offer seniors a rich set of affordable benefits, provide a wide array of health-insurance choices, and be responsive to the demands of seniors. Approximately 71,000 people are enrolled in Medicare Advantage plans in these 51 counties and parishes, accounting for more than $700 million in annual commerce.
According to the complaint, the original transaction would have eliminated competition between Humana and Arcadian, two of the few significant sellers of Medicare Advantage plans in 45 of the counties and parishes, allowing Humana to increase prices and reduce the quality of Medicare Advantage plans sold to seniors there . The original deal would have created a combined company controlling between 40 and 100 percent of the Medicare Advantage health insurance market in these counties and parishes.
Under the proposed settlement, Humana must promptly divest the Medicare Advantage plans in the 51 counties and parishes to one or more acquirers approved by the department that has the intent and capability to be an effective competitor. The department is requiring divestitures of health plans in five additional counties and one additional parish to facilitate the divesture of the plans in the other 45 counties and parishes and make those plans more administrable. Under the terms of the proposed settlement, current enrollees of Humana and Arcadian’s Medicare Advantage plans will continue to have substantially the same access to providers, including doctors, hospitals and other medical services, after the divestitures as before the divestitures were required. The proposed settlement contains provisions that ensure the buyers of the divested Medicare Advantage plans will have contracts with substantially all of the health care providers included in the Humana and Arcadian plans at substantially the same rates. The department said the requirements are important because to compete effectively, a health insurer needs a network of health care providers at competitive rates.
Humana Inc., a leading health insurer in the United States, is a Delaware corporation headquartered in Louisville, Ky. In 2010, Humana reported revenues of approximately $33.6 billion.
Arcadian Management Services Inc., with approximately 62,000 Medicare Advantage members in 15 states, is a Delaware corporation headquartered in Oakland, Calif. In 2010, Arcadian had revenues of $622 million.
The proposed settlement, along with the department’s competitive impact statement, will be published in the Federal Register, as required by the Antitrust Procedures and Penalties Act. Any person may submit written comments concerning the proposed settlement within 60 days of its publication to Joshua H. Soven, Chief, Litigation I Section, Antitrust Division, U.S. Department of Justice, 450 Fifth St., N.W., Suite 4100, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the court may enter the settlement upon a finding that it is in the public interest.
Justice Department Intervenes in Lawsuit Involving New Hampshire’s Mental Health SystemRead the Press Release
WASHINGTON – The Justice Department today moved to intervene in Lynn E. v. Lynch, a recently-filed lawsuit alleging that the state of New Hampshire fails to provide mental health services to people with disabilities in community settings in violation of the Americans with Disabilities Act (ADA) and Section 504 of the Rehabilitation Act of 1973. As a result of the state’s failures, people with mental illness who need state mental health services are forced to go to segregated institutions like the New Hampshire Hospital in Concord, N.H., and the Glencliff Home in Benton, N.H.
Under the ADA, a state cannot require people with disabilities to enter segregated facilities unnecessarily in order to get services. In April of last year, the Department of Justice notified the state that it is violating the ADA by unnecessarily institutionalizing persons with mental illness and by failing to provide necessary community-based services and supports, like crisis services and housing supports. Leadership within the state of New Hampshire has recognized that the state’s mental health system is deficient. According to a top state official, “NH’s mental health system is failing, and the consequence of these failures is being realized across the community. The impacts of the broken system are seen in the stress it is putting on local law enforcement, hospital emergency rooms, the court system and county jails, and, most importantly, in the harm under-treated mental health conditions cause NH citizens and their families.”
The state adopted a 10-year plan for improving its system, however, the state failed to implement important pieces of its plan and to put in place needed reforms to meet the needs of people with mental illness. The New Hampshire Community Mental Health Centers association recently concluded that the state had failed to meet important benchmarks within its 10-year plan and informed federal officials that the New Hampshire community system “has less capacity in January of 2012 than it had in August of 2008 when the ‘Ten-Year Plan’ called for additional investment.”
“States are obligated by the ADA to provide services to people with disabilities in appropriate, integrated settings, so that they can live and work in the community, just like people who do not have disabilities,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “People with mental illnesses in New Hampshire are currently denied this right and are instead forced to receive costly services in inappropriate settings, like state institutions, as well as local hospital emergency rooms, rather than in more therapeutic and less expensive community settings. With our efforts today to intervene, we hope to vindicate the rights of people with disabilities and prompt the state to take the necessary steps to meet their needs in more appropriate community settings.”“Individuals with mental illness who experience a crisis in New Hampshire often spend days in local emergency rooms that are ill-equipped to address their needs, at great expense, and are then transported to the state’s psychiatric hospital, sometimes by the police,” said John P. Kacavas, U.S. Attorney for the District of New Hampshire. “This costly and traumatic process could be avoided if New Hampshire offered proven and effective services in the community to prevent and deescalate crises, help people maintain safe housing and assist them in finding and holding employment.”
For several months last year, the department engaged in talks with the state in an attempt to resolve the violations the department had identified. However, the parties were ultimately unable to come to an agreement. In order to vindicate the rights of people with disabilities under the ADA, the United States now seeks to participate in this lawsuit. The plaintiffs in the case are represented by the Bazelon Center for Mental Health Law, the Center for Public Representation and the New Hampshire Disabilities Rights Center.
The United States’ intervention papers and proposed complaint can be found at www.justice.gov/crt/about/spl/findsettle.php#Complaints.
For more information on the Justice Department’s Civil Rights Division, please visit www.justice.gov/crt.
Greek Shipping Company Sentenced in New Orleans to Pay $2 Million for Intentional Cover-Up of Oil Pollution and Obstruction of JusticeRead the Press Release
WASHINGTON – Ilios Shipping Company S.A. was sentenced today in federal court in New Orleans for violating the Act to Prevent Pollution from Ships (APPS) and obstruction of justice, announced Assistant Attorney General Ignacia S. Moreno and Jim Letten, U.S. Attorney for the Eastern District of Louisiana.
Ilios operated the M/V Agios Emilianos, a 738 foot, 36,573 ton bulk carrier cargo ship that hauled grain from New Orleans to various ports around the world. According to the plea agreement, from April 2009 until April 2011, oily bilge waste and sludge was routinely discharged from the vessel directly into the sea without the use of required pollution prevention equipment. During that time, the crew intentionally covered up the illegal discharges of oil waste by falsifying the vessel’s oil record book. The master of the vessel, Valentino Mislang, previously pleaded guilty to and was sentenced for conspiracy to obstruct justice for his role in destroying evidence and instructing crewmembers to lie to the Coast Guard during an inspection of the vessel in April 2011. According to Mislang, a senior manager of Ilios directed the destruction of computer records and ordered Mislang to tell crewmembers to lie to the Coast Guard.
The chief engineer of the vessel, Romulo Esperas, previously pleaded guilty to and was sentenced for conspiracy to obstruct justice for his role in falsifying the vessel’s oil record book and directing the discharge of oily bilge waste and sludge directly into the sea. According to Esperas, a senior manager of Ilios directed him to discharge the vessel’s oily waste into the sea and refused to provide funding for the proper discharge of the oily waste to shore-side facilities. Both Mislang and Esperas were sentenced to three years of unsupervised release and are not permitted to re-enter the United States during that time.
“The Department of Justice will continue to prosecute shipping companies who break the laws that protect our oceans,” said Assistant Attorney General Moreno. “The penalty imposed by this sentence holds Ilios fully accountable for violating the Act to Prevent Pollution from Ships, and a part of the penalty will fund projects that will help restore precious marine and aquatic resources in Louisiana.”
“We owe a debt of gratitude to the men and women of the U.S. Coast Guard, their partners in the Environmental Protection Agency and our brethren in the U. S. Department of Justice Environment and Natural Resources Division, along with our own U.S. Attorney’s Office professionals, for their continued vigilance in this and other cases protecting our precious environment, coastline and water resources from those unscrupulous companies and individuals who clandestinely and wantonly discharge oily waste into our waters,” said U.S. Attorney Letten. “We will not falter in our commitment to do everything within our power to apprehend and punish these violators in defense of our environment.”
“Unfortunately, we continue to see many environmental crimes cases involving ocean-going commercial vessels. The Coast Guard will continue to hold non-compliant companies and operators accountable when they break the law and endanger the marine environment or public health. I applaud the efforts of Coast Guard Sector New Orleans, the Coast Guard Investigative Service, our Eighth District legal staff and the Department of Justice for their tireless efforts in investigating and prosecuting this case,” said Rear Admiral Roy A. Nash, Eighth Coast Guard District Commander.
All discharges of sludge or oily bilge waste from a vessel are required to be recorded in the vessel’s oil record book. However, none of the illegal discharges were recorded in the oil record book for the M/V Agios Emilianos.
The court ordered Ilios to pay an overall criminal penalty of $2 million. The National Fish and Wildlife Foundation will receive $250,000 to fund projects aimed at the restoration of marine and aquatic resources in the Eastern District of Louisiana.
As a condition of probation, Ilios is required to implement an environmental compliance plan which will ensure that any ship operated by Ilios complies with all maritime environmental requirements established under applicable international, flag state and port state laws. The plan ensures that Ilios’s employees and the crew of any vessel operated by Ilios are properly trained in preventing maritime pollution. An independent monitor will report to the court about Ilios’s compliance with its obligations during the period of probation.
This case was investigated by the U.S. Coast Guard and the Environmental Protection Agency. The case was prosecuted by Emily Greenfield and Dorothy Manning Taylor from the U.S. Attorney's Office of the Eastern District of Louisiana and by Ken Nelson in the Environmental Crimes Section of the Environment and Natural Resources Division of the Department of Justice.
Former Caesars Palace Nightclub Owner, Head Doorman Plead Guilty to Tax CrimesRead the Press Release
Steve Davidovici, formerly a part-owner and manager of the Pure Nightclub located within the Caesars Palace Hotel and Casino in Las Vegas pleaded guilty in federal court to one count of filing a false federal income tax return for the 2006 tax year, the Justice Department and Internal Revenue Service, Criminal Investigation (IRS-CI) announced today. The Justice Department and IRS-CI also announced that Mikel Hasen, the former head doorman at the Pure Nightclub, likewise pleaded guilty to one count of filing a false federal income tax return for the 2006 tax year. U.S. District Court Judge Kent Dawson presided over both plea hearings.
According to information disclosed at the plea hearings, during the years 2005, 2006 and 2007, in addition to fees charged for admission to the nightclub, some of Pure’s patrons made cash payments to Pure door personnel and “VIP hosts” to bypass the general admissions line and to obtain more desirable seating. This money was collected, pooled and generally distributed on a weekly basis to the door personnel and VIP hosts, as well as to managers of Pure such as Davidovici and Hasen. In Hasen’s case, distributions from this “tip pool” comprised the bulk of his compensation during the time he worked at Pure. Davidovici and Hasen each concealed large amounts of this income from the IRS.
Davidovici’s and Hasen’s sentencings are set for June 27, 2012, at 9 a.m.
“With the April 15 tax deadline looming, it is important for people to have confidence that when they pay their taxes, their neighbors and competitors will do the same,” said Paul Camacho, Special Agent in Charge of the IRS-Criminal Investigation, Las Vegas Field Office.
Two VIP hosts under Davidovici’s supervision, Ali (Sean) Olyaie and Richard Chu, have also pleaded guilty to tax crimes for failing to report income earned at Pure. At their respective plea hearings, Olyaie and Chu likewise admitted filing false federal income tax returns for 2006. Olyaie and Chu are also awaiting sentencing.
This case is being investigated by IRS Criminal Investigation and is being prosecuted by Tax Division Trial Attorneys Christopher J. Maietta and Joseph A. Rillotta.
More information about the Justice Department’s Tax Division and its enforcement efforts is available at www.usdoj.gov/tax/.
Detroit Podiatrist Sentenced to One Year in Prison for Medicare Fraud SchemeRead the Press Release
WASHINGTON – A Detroit-area doctor of podiatric medicine was sentenced today to one year in prison for a fraud scheme involving false billings to Medicare, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).
Dr. Errol Sherman was sentenced by U.S. District Judge Gerald E. Rosen in Detroit. In addition to his prison term, Sherman was sentenced to three years of supervised release and ordered to pay $300,000 in restitution. Sherman pleaded guilty on Nov. 22, 2011, to one count of health care fraud.
According to the plea documents, Sherman is a doctor of podiatric medicine licensed in the state of Michigan. Between January 2003 and December 2006, Sherman billed Medicare and Blue Cross Blue Shield of Michigan for a procedure known as an avulsion of the nail plate or nail avulsion procedure. Sherman billed for this procedure thousands of times, claiming that he had performed this procedure on hundreds of beneficiaries from 2003 through 2006. In fact, he had not performed the procedures billed.
Today’s sentence was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General (HHS-OIG), Office of Investigation.
This case was prosecuted by Trial Attorney Catherine K. Dick of the Criminal Division’s Fraud Section and Assistant U.S. Attorney John K. Neal of the U.S. Attorney’s Office for the Eastern District of Michigan. The case was investigated jointly by the FBI and HHS-OIG, as part of the Medicare Fraud Strike Force, supervised by the U.S. Attorney’s Office for the Eastern District of Michigan and the Criminal Division’s Fraud Section.
Since their inception in March 2007, the strike force operations in nine locations have charged more than 1,190 individuals who collectively have falsely billed the Medicare program for more than $3.6 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the 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.
Aryan Brotherhood of Texas Member Sentenced to 20 Years in Prison for Role in 2009 ShootingRead the Press Release
WASHINGTON – A member of the Aryan Brotherhood of Texas (ABT) was sentenced today to 20 years in prison for his role in the 2009 shooting of a man in Jefferson County, Texas, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney John M. Bales of the Eastern District of Texas.
Joshua Mark Bodine, 32, aka “Desperado,” of Vidor, Texas, also was ordered by U.S. District Court Judge Marcia A. Crone to serve three years of supervised release following his prison term. Bodine pleaded guilty on Oct. 11, 2011, to assault with a dangerous weapon in aid of racketeering activity.
Co-defendant John Oliver Manning, 52, aka “Fish,” of Pasadena, Texas, was convicted on Dec. 1, 2011, of racketeering and firearms charges. Bodine has been in custody since his arrest on Feb. 24, 2011, and Manning has been in custody since his arrest on Sept. 9, 2009. A sentencing date for Manning has not yet been set by the court.
According to the indictment, the ABT is a race-based, state-wide organization that operates inside and outside of state and federal prisons throughout the United States. The ABT was established in the early 1980s within the Texas prison system. It modeled itself after and adopted many of the teachings and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to the indictment, the ABT was primarily concerned with the protection of white inmates and white supremacy/separatism. Over time, the ABT expanded its criminal enterprise to include illegal activities for profit.
The evidence presented at Manning’s trial also showed that the ABT enforces its rules and promotes discipline among its members, prospects and associates through murder, attempted murder, conspiracy to murder, assault, robbery and threats against those who violate the rules or pose a threat to the enterprise. Members, and oftentimes associates, are required to follow the orders of higher-ranking members.
The evidence at trial established that on Sept. 7, 2009, Manning shot and wounded ABT associate Matthew Fails in Nederland, Texas, on the orders of Bodine. Specifically, Manning approached Fails with a firearm and a pair of handcuffs in an attempt to collect a debt on Bodine’s behalf and ultimately shot Fails. Fails was declared brain-dead, but later regained consciousness after emergency surgery. A surgeon testified that the wound Fails received caused “agonizing pain” and that Fails “would not ever be the same.”
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosive; the Nederland Police Department; Orange County, Texas, Constable’s Office, Precinct 2; Jefferson County, Texas, Sheriff’s Office; Williamson County, Texas, Sheriff’s Office; Chambers County, Texas, Sheriff’s Office; Alvin, Texas, Police Department; Mont Belvieu, Texas, Police Department; and the Texas Department of Criminal Justice. The case was prosecuted by Special Assistant U.S. Attorney Baylor Wortham of the Eastern District of Texas and Trial Attorney Cody L. Skipper of the Criminal Division’s Organized Crime and Gang Section.
Monday 26 March 2012
Washington State Man Sentenced to 41 Months in Prison for Filing False Liens Against Government OfficialsRead the Press Release
Ronald James Davenport of Chewelah, Wash., was sentenced to 41 months in prison today for filing more than $20 billion in false liens against four federal government officials, the Justice Department and the Treasury Inspector General for Tax Administration (TIGTA) announced today. In addition, Judge Garr M. King, U.S. District Judge for the District of Oregon, sitting by designation, ordered Davenport to serve three years of supervised release.
Davenport’s convictions date from last November when, following a two-day trial, a federal jury in the Eastern District of Washington returned guilty verdicts against Davenport on four counts of filing retaliatory liens against government officials. According to the evidence presented at trial, in December 2009, Davenport filed false liens against the property interests of the U.S. Attorney and the Clerk of Court for the Eastern District of Washington, as well as an Assistant U.S. Attorney and an Internal Revenue Service Revenue officer.
The liens were filed in the county auditor records of Spokane and Whatcom Counties, Wash. Each lien claimed that the victim owed Davenport $5,184,000,000. It also purported to attach all of the victim’s real and personal property as security for this debt. As proved at trial, the defendant chose these four victims because of their involvement in an effort to collect from Davenport more than $250,000 in back taxes.
The case was investigated by TIGTA and prosecuted by the Justice Department’s Tax Division. Both the U.S. Attorney’s Office and the District Court for the Eastern District of Washington were recused from the case.
U.S. and Mexican Officials Sign Letter of Intent to Share $6 Million in Forfeited Assets to Combat Financial Infrastructure of Organized CrimeRead the Press Release
WASHINGTON – U.S. Attorney General Eric Holder and Mexican Attorney General Marisela Morales Ibáñez today signed a letter of intent for the United States to share approximately $6 million in forfeited funds with the Office of the Attorney General of the Republic of Mexico (PGR) to support Mexican efforts to combat the financial infrastructure of organized criminal groups and to enhance bilateral cooperation between the two countries in forfeiture matters.
The letter of intent and anticipated fund sharing recognizes the PGR’s valuable cooperation in the investigation and resolution of the U.S. government’s case against Sigue Corporation for violations of the Bank Secrecy Act. In January 2008, Sigue entered into a deferred prosecution agreement with the Department of Justice on charges of failing to maintain an effective anti-money laundering program. As a result, Sigue forfeited $15 million to the United States and agreed to commit an additional $9.7 million to improving its anti-money laundering program.
“The Department of Justice and the Mexican PGR have built strong and collaborative working relationships in order to combat transnational organized criminal groups,” said Attorney General Holder. “Our intention to share approximately $6 million in forfeited assets with our Mexican counterparts reflects another step forward in our successful crime prevention and public safety efforts. In an era where crime is not limited by physical boundaries, our international partnerships are more critical than ever in the work of bringing criminals to justice.”
As outlined in the letter of intent, the PGR and the Department of Justice, through the Criminal Division’s Asset Forfeiture and Money Laundering Section (AFMLS), will negotiate the specific terms of the Sigue case sharing agreement and establish respective Executive Sharing Committees designed to negotiate and oversee the sharing, delivery, transfer and disbursement of the forfeited funds.
The shared assets will be used to strengthen and support the PGR’s capacity to investigate and prosecute domestic and bilateral money laundering crimes, as well as Mexico’s ability to forfeit the proceeds of crime. This initiative is designed to complement ongoing bilateral efforts to increase pressure on the economic resources of the criminal organizations that operate in Mexico and along the U.S./Mexico border.
The case, filed in the Eastern District of Missouri, arose out of transactions conducted by Sigue and its authorized agents from November 2003 through March 2005. During this time, more than $24.7 million in suspicious transactions were conducted through registered agents of Sigue, including transactions conducted by undercover U.S. law enforcement agents using funds represented to be proceeds of drug trafficking. Sigue did not identify broader patterns of money laundering activity, failed to prevent the unlawful activity from continuing and did not create systems and procedures to identify suspicious financial transactions being conducted by related senders and beneficiaries.
The Sigue forfeiture resulted from a case prosecuted by AFMLS and was investigated by the Drug Enforcement Administration and Internal Revenue Service.
Third Medical Device Company Resolves Foreign Corrupt Practices Act InvestigationRead the Press Release
WASHINGTON – Biomet Inc. has entered into a deferred prosecution agreement with the Department of Justice to resolve improper payments by the company and its subsidiaries in violation of the Foreign Corrupt Practices Act (FCPA), announced the Justice Department’s Criminal Division.
The matter is part of an investigation into bribery by medical device companies of health care providers and administrators employed by government institutions. Previously, Johnson & Johnson and Smith & Nephew Inc. have agreed to pay criminal penalties and entered into deferred prosecution agreements related to the ongoing investigation.
Biomet, headquartered in Warsaw, Ind., manufactures and sells medical devices worldwide and is listed on the NASDAQ. According to the criminal information filed today in U.S. District Court in the District of Columbia in connection with the agreement, Biomet, its subsidiaries, employees and agents made various improper payments from approximately 2000 to 2008 to publicly-employed health care providers in Argentina, Brazil and China to secure lucrative business with hospitals. During this time, more than $1.5 million in direct and indirect corrupt payments were made. In addition, at the end of each fiscal year, Biomet, its executives, employees and agents falsely recorded the payments on its books and records as “commissions,” “royalties,” “consulting fees” and “scientific incentives” to conceal the true nature of the payments.
As part of the agreement, Biomet will pay a $17.28 million criminal penalty and is required to implement rigorous internal controls, cooperate fully with the department and retain a compliance monitor for 18 months. The agreement recognizes Biomet’s cooperation with the department’s investigation; thorough and wide-reaching self-investigation of the underlying conduct; and the remedial efforts and compliance improvements undertaken by the company. In addition, Biomet received a reduction in its penalty as a result of its cooperation in the ongoing investigation of other companies and individuals.
In a related matter, Biomet reached a settlement today with the U.S. Securities and Exchange Commission (SEC), under which Biomet agreed to pay $5.4 million in disgorgement of profits, including pre-judgment interest.
This case is being prosecuted by Trial Attorney Kathleen M Hamann of the Criminal Division’s Fraud Section and was investigated by the FBI’s Washington Field Office’s dedicated FCPA squad.
The Justice Department acknowledges and expresses its appreciation for the significant coordination with and assistance by the staff of the SEC’s Division of Enforcement.
DENSO Corporation Executive Agrees to Plead Guilty to Price Fixing and Bid Rigging on Auto Parts Installed in U.S. CarsRead the Press Release
WASHINGTON – An executive of Japan-based DENSO Corporation, has agreed to plead guilty and to serve time in prison for his role in a conspiracy to fix prices and rig bids for heater control panels (HCPs) installed in U.S. cars, the Department of Justice announced today.
According to a one-count felony charge filed today in the U.S. District Court for the Eastern District of Michigan in Detroit, Norihiro Imai, a Japanese national, along with co-conspirators, engaged in a conspiracy to rig bids for and to fix, stabilize and maintain the prices of HCPs sold to customers in the United States and elsewhere. According to the charge, Imai’s involvement in the conspiracy lasted from at least as early as August 2006 until at least June 2009. According to the plea agreement, which is subject to court approval, Imai has agreed to serve one year and one day in a U.S. prison, to pay a $20,000 criminal fine and to cooperate with the department’s ongoing investigation.
“Today’s guilty plea demonstrates the Antitrust Division’s commitment to hold executives accountable for engaging in illegal conduct that leads to higher prices for American businesses and consumers,” said Acting Assistant Attorney General Sharis A. Pozen in charge of the Department of Justice’s Antitrust Division. “Criminal antitrust enforcement is a top priority, and the division will continue to work with its law enforcement partners in the ongoing investigation in the auto parts industry.”
DENSO manufactures and sells a variety of automotive electrical parts, including HCPs. HCPs are located in the center console of an automobile and control the temperature of the interior environment of a vehicle. According to the charge, Imai and his co-conspirators carried out the conspiracy by, among other things, agreeing during meetings and discussions to coordinate bids submitted to, and price adjustments requested by, automobile manufacturers.
Including Imai, eight individuals and three companies have been charged in the government’s ongoing investigation into price fixing and bid rigging in the auto parts industry. DENSO pleaded guilty on March 5, 2012, and was sentenced to pay a $78 million criminal fine. Yazaki Corporation, another Japanese automotive electrical component supplier, pleaded guilty on March 1, 2012, and was sentenced to pay a $470 million criminal fine. Additionally, four Yazaki executives were charged on Jan. 30, 2012, and have agreed to plead guilty. On Nov. 14, 2011, Furukawa Electric Co. Ltd. pleaded guilty and was sentenced to pay a $200 million fine. Three of Furukawa’s executives also pleaded guilty and were sentenced to serve prison sentences in the United States ranging from a year and a day to 18 months.
Imai is charged with price fixing in violation of the Sherman Act, which carries a maximum sentence of 10 years in prison and a $1 million criminal fine for individuals. The maximum fine for an individual may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
The current prosecution arose from an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by the Antitrust Division’s National Criminal Enforcement Section and the FBI’s Detroit Field Office with the assistance of the FBI headquarters’ International Corruption Unit. Anyone with information concerning the focus of this investigation is urged to call the Antitrust Division’s National Criminal Enforcement Section at 202-307-6694, visit www.justice.gov/atr/contact/newcase.htm or call the FBI’s Detroit Field Office at 313-965-2323.
Friday 23 March 2012
United States Settles False Claims Act Allegations Against Illinois-Based Lifewatch ServicesRead the Press Release
WASHINGTON - LifeWatch Services Inc., a Rosemont, Ill.-based company, has agreed to pay the United States $18.5 million to resolve allegations that the company submitted false claims to federal health care programs, the Justice Department announced today. The settlement resolves two lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act.
The two complaints allege that LifeWatch improperly billed Medicare for ambulatory cardiac telemetry (ACT) services. ACT services are a form of cardiac event monitoring that use cell phone technology to record cardiac events in real time without patient intervention. Traditional event monitoring requires the patient to press a button when he or she notices a cardiac event to record the cardiac rhythms. Medicare reimbursed ACT services at between $750 and $1200 and traditional event monitoring services at roughly $250 during the relevant time period.
According to the complaints, LifeWatch was aware that ACT services were not eligible for Medicare reimbursement for patients who had experienced only mild or moderate palpitations. The complaints allege that LifeWatch nonetheless submitted claims to Medicare for ACT services for such patients using a false diagnostic code in order to have the claims paid. In addition, according to the complaints, LifeWatch improperly induced Medicare claims for monitoring services by providing valuable services in the form of full-time employees to several
hospitals and medical practices, without charge. The relators (whistleblowers) in their lawsuits alleged that these services amounted to kickbacks.
“False claims on federal health care programs drive up the costs of health care for all of us,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division of the Department of Justice. “Today’s settlement furthers the Department of Justice’s commitment to making sure that those who benefit from Medicare play by the rules.”
Ryan Sims, a former LifeWatch sales representative, filed a lawsuit in the U.S. District Court for the Western District of Washington in December 2009. In May 2011, Sara Collins, another former LifeWatch sales representative, filed a complaint in the U.S. District Court for the Southern District of Ohio.
Under provisions of the False Claims Act, individuals can bring a lawsuit on behalf of the government and receive a portion of the proceeds of any settlement or judgment that may result. Sims and Collins together will receive approximately $3.4 million plus interest as their share of the settlement proceeds.
“The False Claims Act is a critical tool for weeding out fraud and protecting the taxpayers,” said U.S. Attorney Jenny A. Durkan, of the Western District of Washington. “We must ensure tax dollars go to intended programs, not to line the pockets of those who seek to cheat the programs.”
“The settlement underscores the need for physicians to be able to make care decisions without undue influence,” said Carter M. Stewart, U.S. Attorney for the Southern District of Ohio. “The settlement is also the result of close cooperation between our office, the Justice Department’s Civil Division and U.S. Attorney Durkan’s office.”
In addition to the monetary settlement, LifeWatch has entered into a comprehensive Corporate Integrity Agreement (CIA) with the Office of Inspector General of the U.S. Department of Health and Human Services to ensure its continued compliance with federal health care benefit program requirements.
“The chief executive officer at LifeWatch as well as other corporate executives will be required to personally certify compliance with our five-year CIA, which includes provisions to monitor LifeWatch’s claim submission process, sales force activities and relationships with some types of business referrals,” said Daniel R. Levinson, Inspector General of the U.S. Department of Health and Human Services. “LifeWatch allegedly tried to boost profits at taxpayer expense, and, ultimately, paid $18.5 million back to the government.”
The claims resolved by the settlement are only alleg ations and do not constitute a determination of liability.
In addition to the efforts of attorneys from the U.S. Attorney’s Offices for the Western District of Washington and Southern District of Ohio and the Commercial Litigation Branch of the Civil Division of the Department of Justice in Washington, D.C., investigators from the Office of Inspector General of the Department of Health and Human Services, Defense Criminal Investigative Service and Office of Inspector General for the Office of Personnel Management assisted the government’s investigation of the whistleblowers’ allegations.
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 nearly $6.7 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department's total recoveries in False Claims Act cases since January 2009 are over $8.9 billion.
Two Bloods Gang Members in Tennessee Convicted for Roles in Three Murders, Racketeering Conspiracy and Firearms OffensesRead the Press Release
WASHINGTON – A federal jury in Nashville, Tenn., has convicted two Bloods gang members for their roles in the murder of three individuals, a racketeering conspiracy and committing firearms offenses, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Jerry E. Martin for the Middle District of Tennessee and Special Agent in Charge Glenn N. Anderson for the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Nashville Field Division.
Keairus Wilson, 22, aka “Key-Thang,” of Nashville, and Rondarius Williamson, 21, also of Nashville, were convicted yesterday in U.S. District Court in Nashville.
Wilson was found guilty on eight counts, including the murders of Michael Goins and Alexandra Franklin. He also was convicted of racketeering conspiracy, using and carrying firearms during and in relation to crimes of violence, and conspiracy to use and carry firearms during and in relation to crimes of violence.
Williamson was found guilty on seven counts, including the murder of Andreus Taylor. He also was convicted of racketeering conspiracy, using and carrying firearms during and in relation to crimes of violence, and conspiracy to use and carry firearms during and in relation to crimes of violence.
“This Nashville jury has convicted two dangerous members of the Bloods gang for acts of murder and other violent crimes,” said Assistant Attorney General Breuer. “The evidence showed, among other things, that Mr. Wilson shot and killed two people and Mr. Williamson shot and killed another person. For their terrorizing conduct, they now each face mandatory life prison terms. To date, 37 individuals have pleaded guilty or been convicted at trial in Nashville for their involvement with the Bloods. Through coordinated investigations and prosecutions of the Bloods, Crips, Aryan Brotherhood, Latin Kings, MS-13 and other violent gangs across the country, this Justice Department is working hard to make our communities safer.”
“The verdicts in this case demonstrate the unwavering commitment of the law enforcement agencies and the prosecution team to hold those accountable who insist on creating an atmosphere of violence and sustaining fear in our neighborhoods,” said U.S. Attorney Martin. “We will continue to vigorously pursue those who engage in such activity and bring them to justice.”
“Jurors in Nashville have sent a loud and clear message with regard to Kearius Wilson and Rondarius Williamson,” said ATF Special Agent In Charge Anderson. “A lifelong sentence to the Bureau of Prisons could be on the horizon for both of these individuals. Criminal activity involving senseless acts of murder, gun crimes and other gang-related activity to promote their lifestyle will always be a concern of the law enforcement officers who have worked relentlessly in this long term investigation. Other gang members in Nashville and across the United States could face similar consequences as cases like these are presented in court. Today, our neighborhoods are a safer place as this case continues to unfold through the investigative work of all the law enforcement agencies involved.”
According to evidence presented at trial, Wilson and Williamson were both members of the Bloods, a violent street gang that originated in Los Angeles in the 1970s and ultimately migrated to cities throughout the United States, including Nashville. Specifically, Wilson was a member of the Eastside Skyline Piru set of the Bloods, and Williamson was a member of the Tree Top Piru set of the Bloods. The Bloods gang has a hierarchal structure and a long-term and often lethal rivalry with the Crips gang.
From approximately 2006 until December 2011, Bloods gang members committed and conspired to commit acts of murder, attempted murder, robbery and drug trafficking. Evidence at trial showed that the Bloods gang members met regularly to plan and agree upon the crimes to commit, including murder; maintained and circulated a collection of firearms for use in criminal activity by Bloods members; distributed cocaine, cocaine base, marijuana and hydromorphone; and used the proceeds of those drug transactions to help finance the gang’s illegal activities. Bloods gang members committed murder and other acts of violence against rival gang members and others during the course of the conspiracy.
According to evidence presented at trial, Wilson and Williamson committed or conspired to commit numerous racketeering acts, including shooting at three different individuals and possessing and selling drugs. In addition, evidence specifically showed that Wilson shot and killed Goins on June 14, 2008, and shot and killed Franklin on July 19, 2008. Evidence also showed that Williamson shot and killed Taylor on May 18, 2009, and robbed and carjacked an individual on Oct. 31, 2009.
Wilson and Williamson face mandatory penalties of life in prison. U.S. District Judge Aleta Trauger scheduled sentencing for July 5, 2012.
Thirty-five individuals have pleaded guilty in the Middle District of Tennessee to various crimes related to their involvement in the Bloods gang. Kenneth Gaddie, aka “K.G.,” remains a fugitive.
Lonnie Greenlee, co-founder of the Galaxy Star Drug Awareness and Gang Prevention Center in Nashville and father of lead defendant Lonnie Newsome, allowed Bloods gang members to use the facility to conduct gang meetings. According to evidence presented at trial, Greenlee provided numerous Bloods gang members with fraudulent documentation of court-ordered community service hours in exchange for money. Greenlee pleaded guilty in May 2011 to one count of racketeering conspiracy. His sentencing is scheduled for April 2, 2012.
The investigation was a joint operation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Metropolitan Nashville Police Department; U.S. Marshals Service; the LaVergne, Tenn., Police Department; and the Davidson County, Tenn., Sheriff’s Office. The case was prosecuted by Trial Attorney Cody L. Skipper of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorney Scarlett M. Singleton for the Middle District of Tennessee.
Pennsylvania- Based Eusa Pharma (USA) Inc. to Pay U.S. $180,000 for Allegedly Submitting Inflated Claims to MedicareRead the Press Release
WASHINGTON – EUSA Pharma (USA) Inc. has agreed to pay the United States $180,000 to resolve claims that it violated the False Claims Act by allegedly encouraging doctors to submit inflated claims to Medicare for imaging scans, the Justice Department announced today. EUSA Pharma (USA) is headquartered in Langhorne, Pa.
The United States alleged that EUSA Pharma, which makes and sells ProstaScint, a radiopharmaceutical, advised health care providers to submit multiple claims for certain imaging scans performed following use of ProstaScint, after the Society of Nuclear Medicine informed the company that only one claim should be submitted for these scans.
“Today’s settlement demonstrates our commitment to ensuring that the Medicare Trust Fund is used to pay for necessary medical care and is not depleted as a result of marketing schemes intended to increase sales by inflating government reimbursements,” said Stuart F. Delery, Acting Assistant Attorney General of the Justice Department’s Civil Division. “We will continue to hold accountable those who abuse public health care programs at the expense of taxpayers.”
Today’s settlement resolves a lawsuit filed by former EUSA Pharma employee Ann-Marie Williams under the qui tam, or whistleblower provisions, of the False Claims Act. Under the False Claims Act, private citizens can bring suit on behalf of the United States and share in any recovery. Ms. Williams will receive $30,600 as her share of the government’s recovery.
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 nearly $6.7 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department's total recoveries in False Claims Act cases since January 2009 are over $8.9 billion.
The investigating agencies were the FBI’s Washington Field Office and the Office of Criminal Investigations of the U.S. Food and Drug Administration.
Lockheed Martin Corporation Reaches $15.85 Million Settlement<br /> with U.S. to Resolve False Claims Act AllegationsRead the Press Release
WASHINGTON – Lockheed Martin Corporation has agreed to pay $15,850,000 to settle allegations that it mischarged perishable tools used on numerous government contracts, the Department of Justice announced today. Lockheed Martin, headquartered in Bethesda, Md., is one of the world’s largest defense contractors.
Today’s settlement resolves allegations that the government was overcharged as a result
of a seven-year pricing scheme by Tools & Metals Inc. (TMI), a subcontractor that sold perishable tools to Lockheed Martin for use on military aircraft, including the F-22 and the F-35 fighter jets. Specifically, the government alleged that TMI inflated the costs of these tools between 1998 and 2005, and that Lockheed Martin passed these costs on to the United States under its various contracts with the government. On Dec. 8, 2005, Todd B. Loftis, a former president of TMI, pleaded guilty and was sentenced to seven years in prison in connection with his role in TMI’s scheme.The United States subsequently brought civil claims against Lockheed Martin under the False Claims Act, alleging that Lockheed Martin contributed to the inflated amounts paid by the United States in connection with TMI’s pricing scheme. Specifically, the government alleged that Lockheed Martin acted recklessly by failing to adequately oversee TMI’s charging practices and by mishandling information revealing these practices. These allegations are the subject of today’s settlement between the United States and Lockheed Martin.
“It is troubling that a large defense contractor with long-established contractual ties with the United States failed to undertake appropriate measures to ensure the integrity and validity of the costs it submitted to the United States,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division.
“This settlement demonstrates the government’s commitment to devoting the necessary resources to protect taxpayer funds from the most complex mischarging schemes,” stated Sarah R. Saldaña, U.S. Attorney for the Northern District of Texas.
Today’s settlement also settles two qui tam, or whistleblower, actions brought under the whistleblower provisions of the False Claims Act and consolidated in the U.S. District Court in Dallas. The case is captioned U.S. ex rel. Becker, et al. v. Tools & Metals, Inc., et al., Civil Action No. 3:05-CV-0627-L.
Under the False Claims Act, a private party can file an action on behalf of the United States and receive a portion of the recovery. The whistleblowers in the two cases resolved by the settlement, Robert Spencer and John Becker, will split a $2 million share of the government’s recovery.
This matter was jointly handled by the Defense Criminal Investigative Service, the Air Force Office of Special Investigations, the Defense Contract Audit Agency, the Contract Integrity Offices of the Departments of the Air Force and the Navy, the Defense Contract Management Agency, the Department of Justice's Civil Division and the U.S. Attorney's Office for the Northern District of Texas.
Justice Department Announces Agreement to Protect Rights of Military and Overseas Voters in WisconsinRead the Press Release
WASHINGTON – The Justice Department announced today that it has reached an agreement with Wisconsin officials to help ensure that military servicemembers, their family members and U.S. citizens living overseas have the opportunity to participate fully in Wisconsin’s April 3, 2012, federal presidential primary election.
The agreement was filed at the same time as a lawsuit brought under the Uniformed and Overseas Citizens Absentee Voting Act (UOCAVA) and signed today by the federal district court in Madison, Wis. The suit alleges that the state failed to send absentee ballots to over 200 of Wisconsin’s eligible military and overseas voters for the April 3, 2012, presidential primary election in sufficient time for those voters to receive, cast and return their ballots. The agreement provides additional time for receipt of absentee ballots to ensure eligible military and overseas voters, who requested ballots from one of the Wisconsin municipalities (at least 65) that sent ballots late, will have sufficient time to vote. Under the agreement, affected voters who have not yet received their ballots will also be offered the opportunity to receive their ballots electronically.“As this agreement demonstrates, we will remain steadfast in our efforts 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 commend the Wisconsin Government Accountability Board and its executive director for working cooperatively with the department and agreeing to measures that will ensure Wisconsin’s military and overseas voters will have a full opportunity to have their votes counted in the upcoming presidential primary election as well as in future federal elections.”
“Servicemembers make tremendous sacrifices for our nation,” said John W. Vaudreuil, U.S. Attorney for the Western District of Wisconsin. “We are committed to seeing that Wisconsin meets its obligations to ensure that military voters, as well as U.S. citizens who are overseas, are given the opportunity to cast a meaningful vote.”
UOCAVA requires states to allow uniformed service voters (serving both overseas and within the United States) and their families and 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. Among those changes was a requirement that states must 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.
The agreement, which has been approved by the federal district court in Madison, also commits Wisconsin to closely monitor its municipalities’ UOCAVA compliance, provide assistance to its municipalities when necessary and report back to the United States about its UOCAVA compliance during the 2012 federal election cycle. In addition, the agreement requires Wisconsin to take steps to ensure compliance with UOCAVA in future federal elections and provide a report to the Department of Justice on those efforts.
More information about UOCAVA and other federal voting laws is available on the Department of Justice website at http://www.justice.gov/crt/about/vot/misc/activ_uoc.php. Complaints may be reported to the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.Former East Alton, Ill., Police Sergeant Pleads Guilty to Abusing an ArresteeRead the Press Release
WASHINGTON – Brent E. Wells, a former police sergeant with the East Alton, Ill., Police Department, pleaded guilty yesterday in U.S. District Court in East St. Louis, Ill., to violating the civil rights of a civilian by assaulting the man during an arrest in front of Wells’s home on Sept. 11, 2010, the Justice Department announced.
Yesterday in court, before U.S. Magistrate Court Judge Donald G. Wilkerson, the former sergeant admitted he assaulted a man who had just been arrested trying to gain unlawful entry into Wells’s home. After calling for other officers to respond to the attempted break-in, Sergeant Wells, who was not on duty, helped the other on-duty officers take the man into custody. Well then escorted the man, in handcuffs, to a patrol car, where he told his fellow officers, “I’m gonna make him piss blood,” before punching the man several times in the kidneys.
“The Department of Justice will continue to vigorously prosecute any officer who abuses his or her authority and uses excessive force,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division.
At sentencing, Wells faces a maximum penalty of one year in prison.
This case was investigated by the FBI and is being prosecuted by Assistant U.S. Attorney Angela Scott of the Southern District of Illinois and by Trial Attorneys T. March Bell and Patricia Sumner of the Civil Rights Division of the Department of Justice.
California Man Sentenced to 300 Months in Prison for Production and Possession of Child PornographyRead the Press Release
WASHINGTON – Edward Lee Sullivan, of Oakland, Calif., was sentenced today to 300 months in prison for production and possession of child pornography, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Melinda Haag of the Northern District of California.
Sullivan, 39, was found guilty on Feb. 25, 2011, of one count of producing and one count of possessing child pornography after a 13-day bench trial before U.S. District Court Judge D. Lowell Jensen of the Northern District of California.
Evidence presented at trial showed that during a two-week period in March 2008, Sullivan trained a 14 year-old girl to work for him as a child prostitute. During the course of those two weeks, Sullivan produced numerous photographs and videos of the minor, which documented the steps Sullivan took to prepare the girl to work as a prostitute and as an actress in pornographic movies. According to trial evidence, Sullivan filmed at least one pornographic video of the minor, which depicted Sullivan instructing the minor as she performed oral sex on him. At the time Sullivan committed these crimes, he was on parole following a 2002 state conviction for pimping and sexual conduct with a 14 year-old girl.
Sullivan also was sentenced today to lifetime supervised release following the completion of his prison term.
The case is being prosecuted by Assistant U.S. Attorneys Andrew S. Huang and Maureen C. Bessette of the Northern District of California and Trial Attorney Alecia Riewerts Wolak of the Criminal Division’s Child Exploitation and Obscenity Section. The investigation was conducted by the FBI; the Berkeley, Calif., Police Department; and the Oakland Police Department.
Thursday 22 March 2012
United States Files Lawsuit Against AT&T in Telecommunications Relay Services Fraud CaseRead the Press Release
The United States has filed a complaint against AT&T Corporation under the False Claims Act for conduct related to its provision of Internet Protocol (IP) Relay services, the Justice Department announced today. AT&T is a global conglomerate that provides a wide variety of telecommunications services, including Telecommunications Relay Services (TRS) for the deaf and hard-of-hearing.
IP Relay is a text-based communications service designed to allow hearing-impaired individuals to place telephone calls to hearing persons by typing messages over the Internet that are relayed by communications assistants (CAs) employed by an IP Relay provider. IP Relay is funded by fees assessed by telecommunications providers to telephone customers, and is provided at no cost to IP Relay users. The FCC, through the TRS Fund, reimburses IP Relay providers at a rate of approximately $1.30 per minute. In an effort to reduce the abuse of IP Relay by foreign scammers using the system to defraud American merchants with stolen credit cards and by other means, the FCC in 2009 required providers to verify the accuracy of each registered user’s name and mailing address.
The United States alleges that AT&T violated the False Claims Act by facilitating and seeking federal payment for IP Relay calls by international callers who were ineligible for the service and sought to use it for fraudulent purposes. The complaint alleges that, out of fears that fraudulent call volume would drop after the registration deadline, AT&T knowingly adopted a non-compliant registration system that did not verify whether the user was located within the United States. The complaint further contends that AT&T continued to employ this system even with the knowledge that it facilitated use of IP Relay by fraudulent foreign callers, which accounted for up to 95 percent of AT&T’s call volume. The government’s complaint alleges that AT&T improperly billed the TRS Fund for reimbursement of these calls and received millions of dollars in federal payments as a result.
“Federal funding for Telecommunications Relay Services is intended to help the hearing- and speech-impaired in the United States,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division of the Department of Justice. “We will pursue those who seek to gain by knowingly allowing others to abuse this program.”
“Taxpayers must not bear the cost of abuses of the Telecommunications Relay system,” said David J. Hickton, U.S. Attorney for the Western District of Pennsylvania. “Those who misuse funds intended to benefit the hearing- and speech-impaired must be held accountable.”
The claims in the United States’ complaint are allegations only; there has been no determination of liability.
The United States’ complaint was filed in a lawsuit originally brought under the qui tam, or whistleblower, provisions of the False Claims Act by Constance Lyttle, a former CA who worked in one of AT&T’s IP Relay call centers. Under the act’s qui tam provisions, a private citizen, known as a “relator,” can sue for fraud on behalf of the United States, which has the option of taking over the case. If the lawsuit is successful, the relator is entitled to a share of any recovery. The case is U.S. ex rel. Lyttle v. AT&T Corp., No. 2:10-cv-1376 (W.D. Pa.).
Three Brandon, Miss., Men Plead Guilty for Their Roles in the Racially Motivated Assault and Murder of an African-American ManRead the Press Release
WASHINGTON – The Justice Department announced today that Deryl Paul Dedmon, 19, John Aaron Rice, 19, and Dylan Wade Butler, 20, all from Brandon, Miss., pleaded guilty today in U.S. District Court in Jackson to federal hate crime charges in connection with an assault culminating in the death of James Craig Anderson, an African-American man, in the summer of 2011.
Dedmon, Rice and Butler were each charged with one count of conspiracy and one count of violating the Matthew Shepard and James Byrd, Jr. Hate Crimes Prevention Act, for their roles in the death-resulting assault of Anderson, 47, of Jackson, Miss. Dedmon, Rice and Butler entered guilty pleas to both counts. The maximum penalty for these charges is life in prison and a $250,000 fine.
“We hope that today’s guilty pleas provide some closure to the victim’s family and to the grievously wounded community that has mourned Mr. Anderson’s death,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “Today’s historic pleas mark the first time that the Matthew Shepard and James Byrd, Jr. Hate Crimes Prevention Act has been used in a case where the defendants’ actions resulted in a victim’s death. The Department of Justice will vigorously pursue those who commit racially motivated assaults and will use every tool at our disposal to ensure that those who commit such acts are brought to justice. And I note that our investigation in this matter is ongoing.”
“The actions of these defendants who have pled guilty do not represent the values of Mississippi in 2012,” said John Dowdy Jr., U.S. Attorney for the Southern District of Mississippi. “The swift and certain investigation by the Jackson Police Department and especially the FBI shows that crimes committed because of a person’s race will not be tolerated. Justice will be color-blind, and hopefully this pursuit of justice in Mr. Anderson's death will help the family in their healing process.”
“ Hate itself is not a crime, and the FBI is mindful of protecting freedom of speech and other civil liberties. The investigation into the murder of James Craig Anderson was not simply an effort to identify who was responsible, it was incumbent upon the FBI to uncover and prove the motivation behind the crime,” said Dan McMullen, Special Agent in Charge of the FBI. “The answer we discovered, put simply, was that James Craig Anderson was killed because of the color of his skin. Hate crimes have a devastating impact on families and communities, and every sector of our community has a role to play in helping to ensure that no person is targeted for violence because of who they are, what they look like or what they believe.”
Today in court, Dedmon, Rice and Butler admitted that beginning in the spring of 2011, they and others conspired with one another to harass and assault African-Americans in and around west Jackson. On numerous occasions, the co-conspirators used dangerous weapons, including beer bottles, sling shots and motor vehicles, to cause, and attempt to cause, bodily injury to African-Americans. They would specifically target African-Americans they believed to be homeless or under the influence of alcohol because they believed that such individuals would be less likely to report an assault. The co-conspirators would often boast about these racially motivated assaults.
The defendants further admitted that on June 25, 2011, they and others attended a birthday party in Puckett, Miss., for a mutual friend. During the party, the defendants and others talked about going to Jackson to harass and assault African-Americans. By the early morning hours of June 26, 2011, the defendants and four other co-conspirators agreed to carry out their plan to find, harass and assault African-Americans.
At around 4:15 a.m., Rice, Butler and two co-conspirators drove to west Jackson in a white Jeep with the understanding that Dedmon and two other co-conspirators would join them a short time later. Rice, Butler and the other two occupants of the Jeep then drove around west Jackson and threw beer bottles from the moving vehicle at African-American pedestrians they encountered. At approximately 5:00 a.m., Rice, Butler and the other two occupants of the Jeep spotted Anderson in a motel parking lot off Ellis Avenue. The occupants of the Jeep decided that Anderson would be a good target for an assault because he was African-American and appeared to be intoxicated. Rice and another co-conspirator decided to get out of the Jeep to distract Anderson while they waited for Dedmon and the other co-conspirators to arrive.
After Dedmon and the other two co-conspirators arrived in Dedmon’s Ford F250 truck, Dedmon and Rice physically assaulted Anderson. Rice first punched Anderson in the face with sufficient force to knock Anderson to the ground, and then Dedmon punched Anderson in the face multiple times while he was on the ground. After the assault, Rice, Butler and two co-conspirators left the motel parking lot in the Jeep. As they left, one of the occupants of the Jeep yelled, “White Power!” Prior to getting back into his truck, Dedmon responded by also yelling “White Power!” Once back in his truck, Dedmon deliberately used his truck to run over Anderson, causing injuries which resulted in Anderson’s death.
After Anderson’s death, a number of the co-conspirators including Rice and Butler agreed to, and did, give false statements to law enforcement officials about the nature of their interactions with Anderson.
These guilty pleas were the result of a cooperative effort among the Justice Department’s Civil Rights Division, the U.S. Attorney’s Office for the Southern District of Mississippi and the Hinds County, Miss., District Attorney’s Office. This case was investigated by the Jackson Division of the FBI and the Jackson Police Department. It is being prosecuted by Trial Attorney Sheldon L. Beer and Deputy Chief Paige M. Fitzgerald of the Civil Rights Division of the Department of Justice, and Glenda R. Haynes of the U.S. Attorney’s Office for the Southern District of Mississippi.
Louisiana Jury Convicts General Manager/Former Owner of Arkla Disposal Services of Violations of Clean Water Act and Obstructing an EPA InvestigationRead the Press Release
WASHINGTON – A federal jury in Shreveport, La., has convicted John Tuma, 54, of Centerville, Texas, of discharging untreated wastewater directly into the Red River without a permit, discharging untreated wastewater into the city of Shreveport sewer system in violation of its permit and obstructing an Environmental Protection Agency (EPA) inspection, announced Assistant Attorney General Ignacia S. Moreno and Western District of Louisiana U.S. Attorney Stephanie A. Finley.
Father and son, John Tuma and Cody Tuma, 28, of Shreveport, were both charged in a five-count indictment with violations of the Clean Water Act, conspiracy and obstruction of justice related to illegal discharges coming from the Arkla Disposal Services Inc., a facility in Shreveport. The Arkla facility received off-site wastewater from industrial processes and from oilfield exploration and production facilities for treatment at the Arkla facility.
“It was irresponsible, illegal and potentially harmful to the health of city residents and their environment for Mr. Tuma to conspire to dump untreated industrial wastewater into Shreveport’s sewer system,” said Assistant Attorney General Ignacia S. Moreno of the Environment and Natural Resources Division of the Department of Justice. “This case is an example of how the Clean Water Act protects the health and safety of the American people.”
“This case was about a defendant who had no concern about the effects of discharging untreated wastewater into the Red River or the people that his actions harmed,” said U.S. Attorney Finley. “The verdict of this jury should send a message that disregarding laws designed to protect citizens will not be taken lightly. Louisiana is a state with precious natural resources, which our office, along with the Environmental Protection Agency, will continue to protect.”
“The defendant dumped thousands of gallons of untreated wastewater directly into the Red River,” said Ivan Vikin, Special Agent in Charge of EPA’s criminal enforcement program in Louisiana. “Improperly discharged wastewater can sicken or injure people, fish and wildlife. Today’s guilty verdict shows that those who try to save money by cutting corners will be vigorously prosecuted.”
Cody Tuma pleaded guilty in February 2012 to one count of negligently discharging pollutants into the Red River without a permit. He faces a maximum penalty of one year in prison or a fine of not more than $100,000, or twice the gross gain or loss resulting from the unlawful conduct, or both. Sentencing for Cody Tuma has been set for June 20, 2012.
John Tuma will be sentenced July 25, 2012. He faces a maximum penalty of five years in prison on the conspiracy charge, three years in prison on each of the Clean Water Act violations and five years in prison on the obstruction of justice charge. He also faces a fine of not more than $250,000, or twice the gross gain or loss resulting from the unlawful conduct, or both, per count.
The case is being investigated by EPA’s Criminal Investigation Division and is being prosecuted by Assistant U.S. Attorney C. Mignonne Griffing and Trial Attorney Leslie E. Lehnert of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division.
Justice Department Settles Document Abuse Claim Against Ross Stores Inc.Read the Press Release
WASHINGTON – The Justice Department announced today that it reached an agreement with Ross Stores Inc., resolving allegations that the company had engaged in a pattern or practice of discrimination based on citizenship status while verifying employment eligibility at its store in San Ysidro, Calif. The department also alleged that Ross Stores discriminated against a work-authorized individual when it refused to honor a genuine work authorization document and requested that she produce a green card, despite the fact that the company did not require U.S. citizens to show specific work authorization documents.
The department’s investigation began in response to a charge of discrimination filed by a work-authorized, non-U.S. citizen, who was not permitted to work at the San Ysidro store after showing a valid employment authorization document (EAD) for the Form I-9. The charging party alleged that Ross Stores refused to allow her to work after presenting her EAD, requested more or different documents for the Form I-9 and eventually withdrew her job offer. The charging party had already produced sufficient documentation establishing her work authorization. The department also alleged that Ross Stores subjected newly hired non-U.S. citizens to excessive demands for documents issued by the Department of Homeland Security, in order to verify their employment eligibility, but did not require the same of U.S. citizens. The Immigration and Nationality Act (INA) requires employers to treat all authorized workers equally during the employment eligibility verification process, regardless of their national origin or citizenship status.
“Employers must not treat authorized workers differently during the employment eligibility verification process based on their citizenship status or national origin,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The department is committed to ensuring authorized workers are treated fairly during the employment eligibility verification process.”
Under the settlement agreement, Ross Stores agrees to reinstate the charging party and pay $6,384 in back pay plus interest to the charging party and $10,825 in civil penalties to the United States. Ross Stores also agrees to comply with the law, to train its human resources personnel about employers’ responsibilities to avoid discrimination in the employment eligibility verification process and to be subject to reporting and compliance monitory requirements for 18 months.
The Office of Special Counsel (OSC) for Immigration-Related Unfair Employment Practices 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 discrimination, including discrimination in hiring and the employment eligibility verification (Form I-9) process. For more information about protections against employment discrimination under the immigration law, call 1-800-255-7688 (OSC’s worker hotline) (1-800-237-2525, TDD for hearing impaired), 1-800-255-8155 (OSC’s employer hotline) (1-800-362-2735, TDD for hearing impaired) or 202-616-5594; email [email protected]; or visit OSC’s website at www.justice.gov/crt/about/osc.
Former San Juan, Puerto Rico, Police Department Officer Convicted for Role in Providing Security for Drug TransactionsRead the Press Release
WASHINGTON – A former officer with the San Juan, Puerto Rico, Municipal Police Department was convicted by a federal jury yesterday for his role in providing security for drug transactions, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Rosa E. Rodriguez-Velez of the District of Puerto Rico and Special Agent in Charge Joseph S. Campbell of the FBI’s San Juan Field Office.
Arcadio Hernandez-Soto, 35, was convicted in San Juan of three counts of conspiracy to possess with intent to distribute more than five kilograms of cocaine, four counts of attempting to possess with the intent to distribute more than five kilograms of cocaine and four counts of possession of a firearm in furtherance of a drug transaction. Hernandez-Soto was charged in an indictment unsealed on Oct. 6, 2010, along with 89 law enforcement officers in Puerto Rico and 44 other individuals, as part of the FBI undercover operation known as Guard Shack.
According to the evidence presented in court, Hernandez-Soto provided security for what he believed were illegal cocaine deals on May 8, 2009; June 4, 2009; July 23, 2009; and July 13, 2010, but which in fact were part of the undercover FBI operation. According to information presented at trial, Hernandez-Soto was employed as a member of the San Juan Police Department but acted as a security guard for what he believed were cocaine deals by frisking the buyer, providing protection for the deal and escorting the buyer in and out of the transaction. Information presented at trial also showed that Hernandez-Soto recruited other police officers to participate in the second, third and fourth deals.
In return for the security he provided, Hernandez-Soto received a cash payment of between $2,000 and $3,000 for each transaction.
U.S. District Judge Carmen C. Cerezo did not schedule a sentencing date. At sentencing, Diaz faces a mandatory minimum sentence of 90 years in prison and a maximum penalty of life in prison.
The case was prosecuted by Trial Attorneys John P. Pearson and Richard B. Evans of the Criminal Division’s Public Integrity Section. The case was investigated by the FBI. The U.S. Attorney’s Office for the District of Puerto Rico also participated in the investigation and prosecution of this case.
Federal Prisoner Charged in California for Murder of CellmateRead the Press Release
WASHINGTON – A federal grand jury returned a two-count indictment today charging Samuel Stone, 32, with first degree murder and murder by a federal prisoner serving a life sentence, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Benjamin B. Wagner for the Eastern District of California.
The indictment alleges that on July 30, 2003, Stone murdered his cellmate, Michael Anita, while the two were being housed in the Special Housing Unit at U.S. Penitentiary Atwater. At the time of the murder, Stone was serving a life sentence for two separate homicides that took place in 1999.
The maximum statutory penalties are life in prison or death. The government has filed a notice of intent to seek the death penalty in this case.
The charges are only allegations and the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case is the product of an extensive investigation by the FBI. The case is being prosecuted by Assistant U.S. Attorney Elana S. Landau for the Eastern District of California and Trial Attorney Jacabed Rodriguez-Coss of the Criminal Division’s Capital Case Unit.
Baton Rouge, La.-area Residents Sentenced in Medicare Fraud SchemeRead the Press Release
Two patient recruiters for several Louisiana durable medical equipment (DME) companies were sentenced today for their roles in Medicare fraud schemes involving fraudulent claims and illegal kickback payments for unnecessary DME, announced the Department of Justice, the Department of Health and Human Services (HHS), the FBI and the Louisiana State Attorney General’s Office.
Stephanie B. Williams and Mary H. Griffin were sentenced by U.S. District Judge James J. Brady of the Middle District of Louisiana to 48 months and 21 months in prison, respectively. Williams was ordered to pay $4 million in restitution, and Griffin was ordered to pay $3.6 million in restitution. In addition, Judge Brady sentenced the defendants to two years of supervised release following their prison terms. Williams pleaded guilty on Dec. 13, 2011, and Griffin pleaded guilty on Oct. 31, 2011.
Williams and Griffin worked as recruiters for Healthcare 1 LLC, Medical 1 Patient Services LLC and Lifeline Healthcare Services Inc., Louisiana-based companies that fraudulently billed medical equipment to the Medicare program from 2004 to 2009. They and other recruiters were hired to obtain prescriptions for medical equipment such as leg braces, arm braces, power wheel chairs and wheel chair accessories. Williams and Griffin obtained information from Medicare beneficiaries as well as prescriptions for medical equipment from the beneficiaries’ physicians. These prescriptions were then used to submit fraudulent claims to the Medicare program. In addition, Griffin participated in a similar scheme at McKenzie Healthcare Solutions Inc., where she was paid kickbacks and caused the submission of fraudulent claims for medically unnecessary DME from 2005 to 2010.
According to court documents, from 2004 to 2010, the companies involved in these schemes submitted more than $30 million in fraudulent billing.
Today’s sentences were announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Donald J. Cazayoux Jr. of the Middle District of Louisiana; Mike Fields, Special Agent-in-Charge of the Dallas Region for the HHS Office of the Inspector General (HHS-OIG); David Welker, Special Agent-in-Charge of the FBI’s New Orleans Division; and James Buddy Caldwell, Louisiana State Attorney General.
The cases were prosecuted by Assistant Chief William Pericak, Trial Attorneys David Maria, Abigail Taylor and Alexander Berlin and former Assistant Chief Ben Curtis of the Criminal Division’s Fraud Section. The cases were investigated by the FBI, HHS-OIG and the Medicaid Fraud Control Unit of the Louisiana State Attorney General’s Office (MFCU), and were 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 Middle District of Louisiana.
Since its inception in March 2007, the Medicare Fraud Strike Force operations in nine locations have charged more than 1,190 defendants that collectively have billed the Medicare program for more than $3.6 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 .
Armenian Power Member and Three Armenian Power Associates Convicted in Los Angeles for Roles in Identity Theft RingRead the Press Release
WASHINGTON – After a five week trial, four defendants have been convicted for their roles in one of the largest bank fraud and identity theft schemes in California history, with dozens of victims in four states and millions of dollars in losses.
The convictions were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Andre Birotte Jr. of the Central District of California, Assistant Director in Charge of the FBI’s Los Angeles Field Office Steven Martinez and Special Agent in Charge of the U.S. Secret Service (USSS) Joseph Beaty.
Arman Sharopetrosian, Karen Markosian, Artush Margaryan and Kristine Ogandzhanyan were found guilty of conspiring to commit bank fraud, attempted bank fraud and various counts of aggravated identity theft. Sharopetrosian, Markosian and Ogandzhanyan waived a jury trial and consented to trial by the judge, and Margaryan proceeded with a jury trial.
Yesterday, U.S. District Judge David O. Carter found Ogandzhanyan, 28, of Burbank, Calif., guilty of one count of bank fraud conspiracy, two counts of attempted bank fraud and four counts of aggravated identity theft. On March 16, 2012, the judge found Sharopetrosian, 33, of Burbank, guilty of one count of bank fraud conspiracy, four counts of bank fraud and seven counts of aggravated identify theft. On March 16, 2012, the judge also found Markosian, 39, of Glendale, Calif., guilty of one count of bank fraud conspiracy, one count of attempted bank fraud and two counts of aggravated identity theft. A jury convicted the fourth defendant, Artush Margaryan, 28, of Van Nuys, Calif., on March 16, 2012, of one count of bank fraud conspiracy, one count of attempted bank fraud and three counts of aggravated identity theft.
Evidence was presented at trial that Sharopetrosian is a member of the Armenian Power organized crime group, and Margaryan, Markosian and Ogandzhanyan are Armenian Power associates.
According to evidence presented at trial, Sharopetrosian directed the massive fraud scheme along with co-defendant Angus Brown, while the two were incarcerated at Avenal State Prison. Using cellular telephones that were smuggled into the prison, Sharopetrosian and Brown worked from behind bars to coordinate with others, including Ogandzhanyn, Markosian and Margaryan, to obtain confidential bank profile information and steal money from victim account holders. Often targeting high-value bank accounts, the defendants used account holders’ personal identifying information – including names, Social Security numbers and dates of birth – to impersonate victims in phone calls to the bank. The defendants gathered account information, transferred funds between victims’ accounts and placed unauthorized check orders for the accounts. They then stole the checks, obtained the victims’ signatures from public documents and paid conspirators to cash the forged checks. Over the course of the six-year conspiracy, the defendants and their co-conspirators caused more than $10 million dollars in losses to victims in Southern California, Nevada, Arizona and Texas.
“These defendants, including two individuals who were operating from a prison cell, perpetrated a massive fraudulent scheme on behalf of a dangerous criminal enterprise,” said Assistant Attorney General Breuer. “As members and associates of Armenian Power, they stole sensitive personal and financial information from innocent consumers and caused millions of dollars in losses. Whether organized criminal groups traffic in drugs, commit financial fraud or wreak other havoc to keep themselves going, they must be stopped. We are doing everything possible to shut down dangerous gangs like Armenian Power.”
“The safety and sanctity of confidential financial information is paramount in today’s society,” said U.S. Attorney Birotte. “Identity theft is a fundamental invasion of consumer privacy that cannot be tolerated. These convictions demonstrate that violators, whoever and wherever they may be, will be caught and will be prosecuted to the fullest extent of the federal law.”
“The defendants were convicted in a trial that uncovered a sophisticated and lengthy scheme that targeted victims in multiple states, and included disturbing details, such as orders made from within prison walls and assistance from bank insiders enlisted by the defendants,” said FBI Assistant Director Martinez. “This case is also indicative of the growing trend of gang or organized crime-affiliated groups now engaging in identity theft and other financial crimes in furtherance of their enterprise.”
These defendants are four of 20 defendants who were charged with operating the bank fraud and identity theft scheme in one of a series of federal indictments unsealed on Feb. 16, 2011. The indictments allege various federal crimes against members and associates of the Armenian Power criminal organization. To date, 19 of the 20 defendants charged in the bank fraud indictment have been convicted, including Brown. One defendant, Faye Bell, was arrested earlier this year and is still awaiting trial.
Sharopetrosian, Margaryan, Markosian and Ogandzhanyan face maximum sentences of 30 years in federal prison for each count of bank fraud, 30 years for each count of conspiracy to commit bank fraud and additional mandatory two year sentences for each count of aggravated identity theft.
Sentencing for all four defendants is scheduled for Aug. 6, 2012, before Judge Carter.
The case is being prosecuted by Assistant U.S. Attorneys Martin Estrada and Joseph McNally of the Central District of California and Trial Attorney Cristina Moreno of the Organized Crime and Gang Section in the Justice Department’s Criminal Division. The case was investigated by the Eurasian Organized Crime Task Force, which includes the FBI, the USSS, the Los Angeles Police Department, the Glendale Police Department, the Burbank Police Department, the Internal Revenue Service and the U.S. Immigration and Customs Enforcement.
Wednesday 21 March 2012
Noted Scientist Sentenced to 13-Year Prison Term for Attempted Espionage, Fraud and Tax ChargesRead the Press Release
WASHINGTON – Stewart David Nozette, 54, a scientist who once worked for the Department of Energy, the Department of Defense, the National Aeronautics and Space Administration and the White House’s National Space Council, was sentenced today to 13 years in prison for attempted espionage, conspiracy to defraud the United States and tax evasion.
The sentence covered charges in two cases. In one, Nozette pleaded guilty in September 2011 to attempted espionage for providing classified information to a person he believed to be an Israeli intelligence officer. In the other, he pleaded guilty in January 2009 to fraud and tax charges stemming from more than $265,000 in false claims he submitted to the government.
The sentencing, which took place this morning in the U.S. District Court for the District of Columbia, was announced by Ronald C. Machen Jr., U.S. Attorney for the District of Columbia; Lisa Monaco, Assistant Attorney General for National Security; and Principal Deputy Assistant Attorney General John A. DiCicco of the Tax Division.
Joining in the announcement were James W. McJunkin, Assistant Director in Charge of the FBI’s Washington Field Office; Paul K. Martin, Inspector General for the National Aeronautics and Space Administration (NASA OIG); Eric Hylton, Acting Special Agent in Charge of the Washington Field Office of the Internal Revenue Service-Criminal Investigation (IRS-CI); and John Wagner, Special Agent in Charge of the Washington, D.C., Office of the Naval Criminal Investigative Service (NCIS).
In addition to the prison term, the Honorable Paul L. Friedman ordered that Nozette pay more than $217,000 in restitution to the government agencies he defrauded.
Nozette has been in custody since his arrest for attempted espionage on Oct. 19, 2009. At the time, he was awaiting sentencing on the fraud and tax evasion charges. FBI agents arrested Nozette following an undercover operation in which he provided classified materials on three occasions, including one that formed the basis for his guilty plea. He was subsequently indicted by a federal grand jury. The indictment does not allege that the government of Israel or anyone acting on its behalf committed any offense under U.S. laws in this case.
“Stewart Nozette's greed exceeded his loyalty to our country” said U.S. Attorney Machen. “He wasted his talent and ruined his reputation by agreeing to sell national secrets to someone he believed was a foreign agent. His time in prison will provide him ample opportunity to reflect on his decision to betray the United States.”
“Stewart Nozette betrayed his country and the trust that was placed in him by attempting to sell some of America’s most closely-guarded secrets for profit. Today, he received the justice he deserves. As this case demonstrates, we remain vigilant in protecting America’s secrets and in bringing to justice those who compromise them,” said Assistant Attorney General Monaco. “I thank the many agents, analysts and prosecutors who worked on this important case.”
“As this case demonstrates, those who attempt to evade their taxes by abusing the tax-exempt status of non-profit entities will be investigated, prosecuted and punished,” said Principal Deputy Assistant Attorney General DiCicco.
“Today’s sentencing demonstrates that espionage remains a serious threat to our national security,” said Assistant Director in Charge McJunkin. “The FBI and our partners in the defense and intelligence communities work every day to prevent sensitive information from getting into the wrong hands, and I commend the hard work of the dedicated agents, analysts and prosecutors who spent a significant amount of time bringing this case to resolution.”
“We are particularly proud that NASA OIG’s fraud investigation of Nozette, which began in 2006, served as the catalyst for further investigation and today's outcome,” said NASA Inspector General Martin.
“IRS-Criminal Investigation provides financial investigative expertise in our work with our law enforcement partners,” said Acting Special Agent in Charge Hylton. “Pooling the skills of each agency makes a formidable team as we investigate allegations of wrongdoing. Mr. Nozette decided to betray his country to line his own pockets rather than play by the rules. He now is being held accountable for his actions.”
“Federal agents take an oath to protect our nation ‘against all enemies, foreign and domestic.’ That would include ‘insider threats’ like Stewart Nozette,” said Special Agent in Charge Wagner. “NCIS is committed to working with our law enforcement partners and prosecutors to find and hold accountable those like Nozette who put personal gain above national security.”
Nozette received a Ph.D. in Planetary Sciences from the Massachusetts Institute of Technology. Beginning in at least 1989, he held sensitive and high-profile positions within the U.S. government. He worked in various capacities on behalf of the government in the development of state-of-the-art programs in defense and space. During his career, for example, Nozette worked at the White House on the National Space Council, Executive Office of the President. He also worked as a physicist for the U.S. Department of Energy’s Lawrence Livermore National Laboratory, where he designed highly advanced technology.
Nozette was the president, treasurer and director of the Alliance for Competitive Technology (ACT), a non-profit organization that he organized in March 1990. Between January 2000 and February 2006, Nozette, through his company, ACT, entered into agreements with several government agencies to develop highly advanced technology. Nozette performed some of this research and development at the U.S. Naval Research Laboratory (NRL) in Washington, D.C., the Defense Advanced Research Projects Agency (DARPA) in Arlington, Va., and NASA’s Goddard Space Flight Center in Greenbelt, Md.
In connection with the fraud and tax case, Nozette admitted that, from 2000 through 2006, he used ACT to defraud the NRL, DARPA and NASA by making and presenting more than $265,000 in fraudulent reimbursement claims, most of which were paid. He also admitted that, from 2001 through 2005, he willfully evaded more than $200,000 in federal taxes. In addition, he admitted using ACT, an entity exempt from taxation because of its non-profit status, to receive income and to pay personal expenses, such as mortgages, automobile loans, sedan services and other items.
The investigation concerning ACT led investigators to suspect that Nozette had misused government information. From 1989 through 2006, Nozette held security clearances as high as TOP SECRET and had regular, frequent access to classified information and documents related to the national defense of the United States.
On Sept. 3, 2009, Nozette was contacted via telephone by an individual purporting to be an Israeli intelligence officer from the Mossad, but who was, in fact, an undercover employee of the FBI. That same day, Nozette informed the undercover employee that he had clearances “all the way to Top Secret SCI” and that anything “that the U.S. has done in space I’ve seen.” He stated that he would provide classified information for money and a foreign passport to a country without extradition to the United States.
A series of contacts followed over the next several weeks, including meetings and exchanges in which Nozette took $10,000 in cash left by the FBI at pre-arranged drop-off sites. Nozette provided information classified as SECRET/SCI and TOP SECRET/SCI that related to the national defense. Some of this information directly concerned satellites, early warning systems, means of defense or retaliation against large-scale attack, communications intelligence information and major elements of defense strategy.
Nozette and the undercover employee met for the final time on Oct. 19, 2009, at the Mayflower Hotel. During that meeting, Nozette pushed to receive larger payments for the secrets he was disclosing, declaring that, “I gave you even in this first run, some of the most classified information that there is. . . . I’ve sort of crossed the Rubicon.”
Nozette was arrested soon after he made these statements.
The investigation of the fraud and tax evasion case was conducted by NASA-OIG, NCIS, the Defense Criminal Investigative Service (DCIS), IRS-CI, the IRS Tax Exempt & Government Entities Group, the Naval Audit Service, the Defense Contract Audit Agency and the FBI’s Washington Field Office.
The prosecution of the fraud and tax evasion case was handled by Assistant U.S. Attorney Michael K. Atkinson from the Fraud and Public Corruption Section of the U.S. Attorney’s Office for the District of Columbia and Trial Attorney Kenneth C. Vert from the Department of Justice’s Tax Division.
The investigation of the attempted espionage case was conducted by the FBI’s Washington Field Office, with assistance from NCIS; Naval Audit Service; National Reconnaissance Office; Air Force Office of Special Investigations; Defense Computer Forensics Laboratory; Defense Advanced Research Projects Agency; DCIS; Defense Contract Audit Agency; U.S. Army 902nd Military Intelligence Group; NASA Office of Counterintelligence; NASA-OIG; Department of Energy Office of Intelligence and Counterintelligence; IRS-CI; IRS Tax Exempt & Government Entities group; U.S. Customs and Border Protection; and the U.S. Postal Inspection Service, as well as other partners in the U.S. intelligence community.
The prosecution of that case was handled by Assistant U.S. Attorney Anthony Asuncion, from the National Security Section of the U.S. Attorney’s Office for the District of Columbia, and Trial Attorneys Deborah A. Curtis and Heather M. Schmidt, from the Counterespionage Section of the Justice Department’s National Security Division.
La Fuerza de Tarea del Secretario de Justicia de EE.UU. sobre la Exposición Infantil a la Violencia realiza una audiencia pública en MiamiRead the Press Release
La Fuerza de Tarea Nacional del Secretario de Justicia de EE.UU. Eric Holder sobre Niños Expuestos a la Violencia concluyó una audiencia pública de tres días de duración en Miami hoy, acerca de los desafíos que representa prevenir la exposición de los menores a la violencia en la comunidad. En la audiencia, panelistas expertos sobre el sistema de bienestar infantil prestaron testimonio sobre cómo los jóvenes inmigrantes y en riesgo están expuestos a la violencia, y cómo alcaldes de todo el país están interrumpiendo el ciclo de la violencia en sus ciudades, entre otros problemas.
La fuerza de tarea es una parte clave de la Iniciativa Defensa de la Niñez del Secretario de Justicia de EE.UU. Holder para prevenir y reducir la exposición de los menores a la violencia. Lo acompañan en liderar la fuerza de tarea Joe Torre, presidente del consejo de la Joe Torre Safe At Home Foundation, y Robert Listenbee Jr., jefe de la Unidad Juvenil de la Defender Association of Philadelphia. La fuerza de tarea está compuesta por 13 importantes expertos, incluidos profesionales, defensores de menores y familias, expertos académicos y profesionales clínicos habilitados.
Durante la audiencia en Miami, los miembros de la fuerza de tarea escucharon los testimonios de testigos como Roy Martin, Gerente de Programa de Partnership Advancing Community Together (PACT), el cual es parte de la Comisión de Salud de Boston. Martin le dijo a la fuerza de tarea, "Vengo de una familia en la que cada pariente del sexo masculino con edad suficiente para ir a la cárcel o la prisión, lo ha hecho, incluido yo mismo". Martin observó que fue un miembro de la población que atiende, lo que ofrece ventajas singulares para sentirse identificado con las necesidades de la comunidad. Además, el Alcalde Dwight C. Jones de Richmond, Va., describió a la comunidad religiosa como "un recurso que tendría que utilizarse más y una franquicia con un establecimiento en cada esquina". También observó que, en Richmond, la ciudad se está concentrando en iniciativas que destaquen y fortalezcan las relaciones saludables entre padres e hijos y el sentido de autoestima y las capacidades de los niños.
"El proteger a los niños y jóvenes de nuestra nación contra la violencia es una prioridad urgente para nosotros, aquí en Florida, y en todo el país", dijo Wifredo A. Ferrer, Fiscal Federal para el Distrito Sur de Florida. "Ya sea como víctimas o como testigos, la exposición infantil a la violencia suele provocar daños físicos, psicológicos y emocionales de largo plazo, así como un riesgo más alto de exhibir un comportamiento delictivo más adelante en la vida. Al trabajar juntos para prevenir, mitigar y tratar la exposición a la violencia, podemos romper este ciclo, lo cual es en el mejor interés de nuestros niños y nuestras comunidades".
"Los testimonios de los sobrevivientes y expertos destacaron la urgencia y gravedad de ese problema para los niños en vecindarios urbanos de bajos recursos", dijo el codirector de la fuerza de tarea Listenbee. "Nuestros niños merecen sentirse seguros y protegidos en sus hogares y comunidades. Me complacerá trabajar con mis compañeros de la fuerza de tarea en destacar soluciones prácticas y creativas".
La fuerza de tarea identificará prácticas, programación y estrategias comunitarias prometedoras para prevenir y responder a la exposición infantil a la violencia, y presentará un informe final al Secretario de Justicia de EE.UU. en diciembre de 2012. El informe presentará recomendaciones de política y servirá de guía para prevenir y reducir los efectos negativos de dicha violencia en todos los Estados Unidos.
Un estudio de 2009 realizado por la Oficina de Justicia Juvenil y Prevención de la Delincuencia encontró que casi la mitad de los niños y adolescentes encuestados fueron agredidos al menos una vez el año pasado, y que más de uno de cada 10 sufrió lesiones en un ataque. Los adolescentes de más edad (14 a 17 años) resultaron tener mayores probabilidades de ser víctimas de agresiones que acabaron en lesiones, ataques por pandillas, victimizaciones sexuales y abuso físico y emocional, y de ser testigos de violencia en la comunidad.
Para obtener más información sobre la Iniciativa de Defensa de la Niñez del Secretario de Justicia de EE.UU. Holder, su fuerza de tarea y audiencias públicas, visite: www.justice.gov/defendingchildhood.
Para leer el artículo de opinión del codirector de la fuerza de tarea, Joe Torre, sobre niños expuestos a la violencia, publicado en el Miami Herald, visite: http://blogs.usdoj.gov/blog/archives/1926
Justice and Interior Departments Launch National Criminal Justice Training Initiative in Cherokee NationRead the Press Release
CATOOSA, Okla. – The Justice and Interior Departments today completed the first in a series of national level training courses, “Criminal Jurisdiction in Indian Country” (CJIC), designed to strengthen the ability of tribal and local law enforcement to participate in the investigation and enforcement of federal crimes in Indian country and fulfill a key training requirement under the Tribal Law and Order Act of 2010 (TLOA).
Thirty-five class participants representing seven tribes from the surrounding region and one county sheriff’s office took part in the three-day CJIC training, which began on Monday. Topics included training in federal Indian law criminal jurisdiction, how to best serve sexual assault and domestic violence victims, as well as the investigation and enforcement of drug and firearm offenses.
The course, taught by the Justice Department’s National Indian Country Training Coordinator with Assistant U.S. Attorneys, fulfills one of the requirements for participating officers to receive a Special Law Enforcement Commission (SLEC) from the Bureau of Indian Affairs.
“The special law enforcement commission gives tribal police the ability to investigate and make arrests in federal cases,” said Leslie A. Hagen, National Indian Country Training Coordinator for the Justice Department’s Executive Office for U.S. Attorneys. “This authority, and the protections that go along with it, helps build the capacity of tribal law enforcement to keep their communities safe and strengthens federal and tribal partnerships for public safety.”
“TLOA paves the road for more tribal and federal collaboration to address federal crimes in Indian Country,” said Darren Cruzan, Deputy Director of the BIA’s Office of Justice Services. “Pivotal trainings like the SLEC demonstrate this administration’s commitment to strengthening the capabilities and partnerships of tribal and local law enforcement to fight crime across jurisdictional lines.”
An SLEC allows those officers to enforce federal criminal statutes and federal hunting and fishing regulations in Indian Country. With the passage of the TLOA, primary responsibility for delivery of CJIC training shifted to the Department of Justice. Over the last several years, U.S. Attorney’s Offices across the country have begun to host regionally-based CJIC training in addition to the sessions hosted by BIA at its training academy. While the SLEC is still issued by BIA, Section 213 of TLOA states that tribal liaison duties shall include providing technical assistance and training regarding evidence gathering techniques and strategies to address victim and witness protection and conducting training sessions and seminars to certify special law enforcement commissions to tribal justice officials and other individuals and entities responsible for responding to Indian country crimes.
The BIA and Justice Department officials have been working together over the past year to create a new U.S. Attorney Office-led CJIC training curriculum. The National Indian Country Training Coordinator, together with tribal liaisons and Assistant U.S. Attorneys Kerry Jacobson of the District of Wyoming, John Tuchi of the District of Arizona, Glynette Carson-McNabb of the District of New Mexico and Sarah Collins of the District of South Dakota, developed the CJIC curriculum and are also assisting with the training sessions.
Participants in this week’s training include: The Cherokee Nation Marshal Service, Quapaw Tribal Marshal Service, Comanche Nation Police Department, Wyandotte Nation Police Department, Eastern Shawnee Police Department, the Osage Nation Police Department, the Chickasaw Nation Lighthorse Police Department and the Delaware County Sheriff’s Office. In addition to this week’s training hosted by the Cherokee Nation in Oklahoma, future training is scheduled for April 4-6 at the Hopland Band of Pomo Indians in California. For more information on the national CJIC training program, contact Mark Decoteau, Deputy Chief of Training at the Indian Police Academy, at [email protected].
This week’s training was also completed with the support and/or participation of the U.S. Attorney’s Offices in the Eastern, Western and Northern Districts of Oklahoma.
“We’re proud to host this first national training mandated by the Tribal Law and Order Act,” said Thomas Scott Woodward, U.S. Attorney for the Northern District of Oklahoma. “It is another excellent example of how the Departments of Justice and Interior are working more closely than ever with each other and with tribal governments to close jurisdictional gaps and strengthen the law enforcement partnerships that make communities safer.”
Georgia Man Sentenced to 17 Years in Prison for Sex Trafficking of a MinorRead the Press Release
WASHINGTON – An Atlanta man was sentenced today to 17 years in prison and 10 years of supervised release for sex trafficking of a minor, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney for the Northern District of Georgia Sally Quillian Yates.
Marcelo Alejo Desautu, 39, was sentenced by U.S. District Judge Orinda D. Evans in Atlanta. He pleaded guilty to the charge on Jan. 10, 2012.
“Mr. Desautu gave drugs and alcohol to a 12-year-old girl and then prostituted her to adult men,” said Assistant Attorney General Breuer. “He will now, appropriately, spend the next 17 years of his life paying for his horrific crimes. While no prison sentence can repair the harm caused by such appalling conduct, today’s sentence sends a strong message that we will pursue child sex traffickers to the fullest extent of the law.”
“This defendant earned a substantial sentence in federal prison when he drugged and sexually exploited a 12-year-old girl, forever altering the course of her life,” said U.S. Attorney Yates. “It is unfathomable that there is even a market for the sale of such a young child for sex. This lengthy sentence should deter others who would consider engaging in similar heinous acts.”
According to court documents and proceedings, between December 2007 and March 2008, Desautu agreed to care for a 12-year-old girl. Desautu instead gave the girl alcohol and drugs and then arranged for her to engage in sex acts with adult males for money. Desautu took the money the men paid to the young victim and used it to buy drugs for himself and the victim. Desautu also had sex with the young girl. One of the men who paid to have sex with the 12-year-old was Gwinnett County businessman Peter Privateer. Privateer has been charged in both Cobb and Gwinnett Counties, in Georgia, and has entered a guilty plea in Cobb County.
This case was investigated by the Cobb County Police Department and the FBI. This case was prosecuted by Assistant U.S. Attorney Jill Steinberg of the Northern District of Georgia and Trial Attorney Andrew McCormack of the Child Exploitation and Obscenity Section (CEOS) in the Justice Department’s Criminal Division.
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 CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Federal Court Bars Former Owner of Brooklyn Tax Firm from Operating Tax Preparation BusinessesRead the Press Release
A federal court has permanently barred Annie P. Williams, the former proprietor of PPH Tax & Realty Inc. in Brooklyn, N.Y., from preparing federal tax returns for others and from having any ownership or financial interest in any tax preparation business, the Justice Department announced today. The civil injunction order, to which Williams consented without admitting the allegations against her, was entered by Judge Dora L. Irizarry of the U.S. District Court for the Eastern District of New York.
According to the government complaint in the case, Williams fostered an environment at PPH in which her part-time tax preparers, who had little or no tax experience, were encouraged to prepare fraudulent tax returns. The improper conduct alleged in the complaint included preparing federal tax returns that claimed false expense and charitable contribution deductions, bogus dependents and unallowable child and childcare tax credits.
The complaint also alleged that, during the time that Williams owned PPH, her employees sold other persons’ names and Social Security numbers to customers so that the customers could falsely report that those other persons were their childcare providers for purposes of falsely claiming the childcare tax credit. Employees also allegedly sold fake charitable contribution letters to customers to present to the Internal Revenue Service (IRS) during audits to substantiate false deductions.The IRS has listed return preparer fraud as one of the “Dirty Dozen” tax scams for 2012. The Justice Department’s Tax Division has obtained injunctions against hundreds of unscrupulous return preparers and tax-fraud promoters in the past decade. Information about these cases is available on the Justice Department website .
Stipulated Order of Permanent Injunction (PDF)
Department of Justice Releases Investigative Findings on the Walnut Grove Youth Correctional Facility in MississippiRead the Press Release
WASHINGTON – Following a comprehensive investigation, the Justice Department announced today its findings that the state of Mississippi violated the constitutional rights of youth detained at the Walnut Grove Youth Correctional Facility (WGYCF). WGYCF is a 1,500-bed prison that houses young men aged 13-22 who were convicted as adults and are in the custody of the Mississippi Department of Corrections. WGYCF is run by the GEO group, a private prison company, under contract with the state.
The investigation, announced on Oct. 25, 2010, was in accordance with the Civil Rights of Institutionalized Persons Act (CRIPA), and the Violent Crime Control and Law Enforcement Act of 1994. CRIPA gives the Justice Department authority to seek a remedy for a pattern or practice of conduct that violates the constitutional rights of prisoners in adult detention and corrections facilities. The Violent Crime Control and Law Enforcement Act of 1994 authorizes the Department of Justice to seek a remedy for a pattern or practice of conduct that violates the constitutional or federal statutory rights of youth in juvenile justice institutions.
The United States conducted an in-depth investigation, including an on-site inspection of WGYCF, accompanied by expert consultants in the areas of corrections, medical care and mental health care. Evidence reveals systematic, egregious and dangerous practices at WGYCF exacerbated by a lack of accountability and controls. The Justice Department found reasonable cause to believe that a pattern or practice of unconstitutional conduct exists in several areas, including:
- Deliberate indifference to staff sexual misconduct and inappropriate behavior with youth;
- Use of excessive use of force by WGYCF staff on youth;
- Inadequate protection of youth from youth-on-youth violence;
- Deliberate indifference to youth at risk of self-injurious and suicidal behaviors; and
- Deliberate indifference to the medical needs of youth.
“Our findings show that due to the unconstitutional operation of WGYCF, youth were sexually preyed upon by staff and all too frequently suffered grievous harm, including death,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The widespread and significant deficiencies at the facility violate the Eighth Amendment’s mandate that imprisoned youth be protected from harm and provided with adequate medical and mental health care. The department looks forward to working with the state and its officials to address the constitutional violations by developing and implementing comprehensive remedial measures.”
This investigation was conducted by the Special Litigation Section of the Civil Rights Division. The full report can be found at www.justice.gov/crt/about/spl/findsettle.php. For more information on the Justice Department’s Civil Rights Division, please visit www.justice.gov/crt.
Attorney General’s Task Force on Children’s Exposure to Violence Holds Public Hearing in MiamiRead the Press Release
Attorney General Eric Holder’s National Task Force on Children Exposed to Violence concluded a three-day public hearing in Miami today on the challenges of preventing children’s exposure to violence in the community. At the hearing, expert panelists on the child welfare system testified about how immigrant and at-risk youth are exposed to violence and how mayors across the country are interrupting the cycle of violence in their cities, among other issues.
The task force is a key part of Attorney General Holder’s Defending Childhood Initiative to prevent and reduce children’s exposure to violence and is co-chaired by Joe Torre, chairman of the board of the Joe Torre Safe At Home Foundation, and Robert Listenbee Jr., chief of the Juvenile Unit of the Defender Association of Philadelphia. The task force is composed of 13 leading experts, including practitioners, child and family advocates, academic experts and licensed clinicians.
During the Miami hearing, task force members heard testimony from witnesses including Roy Martin, Program Manager for the Partnership Advancing Community Together (PACT), which is part of the Boston Health Commission. Martin told the task force that “I come from a family where every male relative old enough to go to jail or prison has gone, including me.” Martin noted that he was once a member of the population he serves, which offers unique strengths in relating to the needs of the community. In addition, Mayor Dwight C. Jones of Richmond, Va., described the faith community as “an underutilized resource – a franchise with a location on every corner.” He also noted that in Richmond, the city is focusing on efforts that emphasize and strengthen healthy parent-child relationships and children’s sense of self-esteem and abilities.
“Protecting our nation’s children and youth from violence is an urgent priority for us here in Florida and across the country,” said Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida. “Whether as victims or witnesses, children’s exposure to violence often leads to long-term physical, psychological and emotional harm – as well as higher risk of engaging in criminal behavior later in life. By working together to prevent, mitigate and treat exposure to violence, we can break this cycle, which is in the best interest of our children and our communities.”
“Testimony from survivors and experts stressed the urgency and seriousness of this problem for children in poor urban neighborhoods,” said task force co-chair Listenbee. “Our children deserve to feel safe and secure in their homes and in their communities. I look forward to working with my fellow task force members to highlight practical and creative solutions.”
The task force will identify promising practices, programming and community strategies to prevent and respond to children’s exposure to violence, which will inform a final report to the Attorney General in December 2012. The report will present policy recommendations and serve as a blueprint for preventing and reducing the negative effects of such violence across the United States.
A 2009 study by the Office of Juvenile Justice and Delinquency Prevention found that n early one-half of the children and adolescents surveyed were assaulted at least once in the past year, and more than one in 10 were injured in an assault. Older adolescents ages 14 to 17 were the most likely to be victims of assaults that ended in injury, gang assaults, sexual victimizations and physical and emotional abuse, and to witness violence in the community.
For more information about Attorney General Holder’s Defending Childhood Initiative, its task force and public hearings, please visit: www.justice.gov/defendingchildhood
To read task force co-chair Joe Torre’s op-ed on children exposed to violence, which was published in the Miami Herald, please visit: http://blogs.usdoj.gov/blog/archives/1926
Aryan Brotherhood of Texas Gang Member Convicted in Houston of Racketeering ChargesRead the Press Release
WASHINGTON - Aryan Brotherhood of Texas (ABT) gang member David Harlow was found guilty today by Senior U.S. District Judge Ewing Werlein Jr. in Houston of racketeering aggravated assault and conspiracy to commit racketeering aggravated assault for his role in the 2008 beating of a gang prospect.
The guilty verdict was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson for the Southern District of Texas.
According to evidence presented at trial, Harlow, 43, aka “Bam Bam,” was a member of the ABT, a powerful race-based, state-wide organization that operated inside and outside of state and federal prisons and elsewhere in the United States. The evidence showed that the ABT was established in the early 1980s within the Texas prison system and modeled itself after and adopted many of the teachings and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to court filings, the ABT was primarily concerned with the protection of white inmates and white supremacy/separatism. Over time, however, the ABT expanded its criminal enterprise to include illegal activities for profit.
The evidence presented at trial also showed that the ABT enforced its rules and promoted discipline among its members, prospects and associates through murder, attempted murder, conspiracy to murder, assault, robbery and threats against those who violate the rules or pose a threat to the enterprise. Members, and oftentimes associates, are required to follow the orders of higher-ranking members, often referred to as “direct orders.”
All of Harlow’s 11 co-defendants, including Cooke, previously pleaded guilty to violent crimes in aid of racketeering.
Harlow faces a maximum sentence of 20 years in prison. Sentencing for Harlow is scheduled for June 15, 2012, before Judge Werlein.
This case is being investigated by FBI’s Multi-Agency Gang Task Force consisting of the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Drug Enforcement Administration; the FBI; the U.S. Marshals Service; the Texas Rangers, the Texas Department of Public Safety; the Montgomery County, Texas, Precinct 4 Constables Office; the Montgomery County Sheriff’s Department; the Houston Police Department-Gang Division; and the Harris County, Texas Sheriff’s Office.
The case is being prosecuted by David Karpel of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorney Jay Hileman of the U.S. Attorney’s Office for the Southern District of Texas.
Alleged Members of Jewelry Theft Ring ArrestedRead the Press Release
WASHINGTON – Seven alleged members of a jewelry theft ring were arrested yesterday on charges related to their alleged roles in a highly sophisticated and violent organization that has stolen more than $4.6 million worth of jewelry from traveling jewelry sales representatives throughout Virginia and at least six other states. Charges against the individuals were unsealed today after the defendants made initial court appearances in Newport News, Va.
The arrests and charges were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Neil H. MacBride for the Eastern District of Virginia; and Daniel Kumor, Acting Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division.
“According to the charges unsealed today, members of this organized criminal group stole more than $4.6 million in jewelry from victims in Virginia and at least six other states,” said Assistant Attorney General Breuer. “The defendants allegedly operated their sophisticated scheme for more than two years, using intimidation and violence to carry it out. Organized criminal groups pose a serious threat to the safety and security of our communities, and we will continue to do everything in our power to bring them to justice.”
“This tight-knit group is accused of violently attacking traveling salesmen to rob them of more than $4.6 million in jewelry,” said U.S. Attorney MacBride. “This group did their homework. We allege they were dangerous, patient, extremely mobile and struck swiftly. We are grateful that the ATF and our law enforcement partners were just as patient, mobile and able to strike swiftly once we had identified those believed to be involved.”
“These arrests highlight the outstanding work that dedicated ATF agents and our law enforcement partners do to keep our streets safe,” said Acting Special Agent in Charge Kumor. “This investigation required a lot of long hours and excellent coordination among investigators, prosecutors and agencies throughout the region, and epitomizes the fine work law enforcement does every day.”
According to court records, Alexander Cuadros-Garcia, aka “Alex,” “Brujo,” “Aleto” and “Manuel Gonzalez”, 37, of Richmond, Va., is accused of leading a team of individuals who specialized in conducting surveillance on jewelry stores to identify and then rob jewelry sales representatives and couriers. The ring is believed to have committed and attempted robberies since March 2010 in Prince William County, Henrico County, Virginia Beach, Williamsburg, McLean, Charlottesville, Harrisonburg and Roanoke in Virginia, as well as locations in New York, New Jersey, North Carolina, Maryland, Tennessee and California.
Court documents allege the ring has ties to South American theft groups, which are transnational criminal groups typically of Colombian nationality that work in teams to steal jewelry, gems and precious metals from individuals carrying hundreds of thousands of dollars in merchandise at one time.
The alleged members of the Richmond-based ring regularly conducted lengthy surveillance on jewelry stores to identify vulnerable individuals and then follow their targets back to the individuals’ hotel or home. In most of the alleged robberies, several men would suddenly appear as the victims approached or entered their car, punch out the car’s windows, threaten the victims at knife-point and steal the victims’ merchandise. In addition, the thieves would puncture the victims’ car tires and steal their cell phone to reduce the chance of pursuit or apprehension.
After a successful robbery, members of the ring allegedly traveled to New York to sell the merchandise to businessmen, who acted as “fences” and coordinated re-selling the stolen property or melting it down for future use.
In addition to Cuadros-Garcia, those arrested yesterday include the following:
- Leonardo Ortiz, 41, aka “Luis Angel Arana-Garcia,” of North Chesterfield, Va., who allegedly participated in most of the robberies, conducted surveillance, structured cash and made numerous trips to New York to meet with the “fences.”
- Lucesita Argueta, 32, aka “Lucy,” of Richmond, who allegedly participated in several robberies, conducted surveillance and coordinating with the “fences.”
- Francisco Javier Montesrein-Rodriguez, 32, aka “Lois K,” “Lex” and “Luis Rodriguez,” of Henrico, Va., who allegedly participated in several robberies and heavily assisted with the surveillance activities of the theft ring.
- Raul Antonio Escobar-Martinez, 37, aka “Tony,” of Richmond, who allegedly assisted with surveillance of theft victims and potential victims.
- Jose Alfredo Rivero-Garcia, 51, aka “Alfredo” and “Jose Ribero,” of Richmond, who allegedly participated in the surveillance of prospective robbery victims.
- Juanita Diaz, 42, of Henrico, Va., the ex-wife of Cuadros-Garcia, who allegedly assisted in structuring proceeds from the sale of the stolen property, registered cars used by conspirators and provided other assistance to the theft ring.
Cuadros Garcia, Ortiz, Argueta, Montesrein-Rodriguez and Rivero were arrested yesterday in the Fredericksburg, Va.,- area, while Diaz was arrested in Richmond and Escobar-Martinez was arrested in Texas.
Diaz was charged in the criminal complaint with conspiracy to commit money laundering, which carries a maximum penalty of 20 years in prison. The remaining defendants were charged with conspiracy to obstruct, delay and affect commerce by robbery and face a maximum penalty of 20 years in prison, if convicted.
The investigation of this case was led by the ATF’s Washington Field Division, with the assistance of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; the police departments in Williamsburg, Virginia Beach, Henrico County, Chesterfield, Prince William County and Fairfax County in Virginia, along with the Virginia State Police; the Baltimore County, Md., Police Department; the Port Authority of New York and New Jersey; the New York City Police Department; and the police departments in Rutherford, N.J., and Gwinnett County, Ga.; and the Morris County, N.J. Prosecutor’s Office.
Assistant U.S. Attorney Eric M. Hurt, Managing Assistant U.S. Attorney Howard Zlotnick and Trial Attorney Jerome Maiatico of the Organized Crime and Gang Section in the Justice Department’s Criminal Division are prosecuting the case on behalf of the United States.
Criminal complaints are only charges and not evidence of guilt. Defendants are presumed to be innocent until and unless proven guilty.
Tuesday 20 March 2012
Two Southern California Men Plead Guilty for Their Roles in a Nationwide Breach of Credit and Debit Card Terminals at Michaels Stores Inc.Read the Press Release
WASHINGTON – Two southern California men pleaded guilty today in the Northern District of California for their roles in a scheme to defraud nearly 1,000 debit card holders by using stolen bank account information to withdraw money from ATMs, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Melinda Haag of the Northern District of California; and Andrew C. Adelmann, Special Agent in Charge for the U.S. Secret Service (USSS) San Francisco Field Office.
Edward Arakelyan, 21, and Arman Vardanyan, 22, were each charged in a criminal information filed on March 5, 2012, in U.S. District Court in Oakland, Calif., with one count of conspiracy to commit bank fraud, one count of bank fraud, and one count of aggravated identity theft.
“Mr. Arakelyan and Mr. Vardanyan used stolen bank account information to withdraw tens of thousands of dollars in consumer funds from ATMs across northern California,” said Assistant Attorney General Breuer. “With the personal information of nearly 1,000 debit card holders in hand, they stuffed their pockets with other people’s money. This easy cash has now come at a high price. As the defendants have learned the hard way, this Justice Department is aggressively pursuing consumer fraud schemes from coast to coast.”
“This case demonstrates the extent perpetrators of identity theft go to to gain access to another person’s bank account,” U.S. Attorney Haag said. “These are crimes that my office takes very seriously. We will continue to work with our partners in law enforcement to investigate and prosecute the criminals who attempt to lay claim to other peoples’ hard-earned money. It is our hope that the efforts of law enforcement will help bring an end to these types of crimes and will help restore consumer confidence.”
“This case clearly represents the importance of effective interagency collaboration at the local, state and federal level,” stated USSS Special Agent in Charge Adelmann. “The U.S. Secret Service through our law enforcement partnerships continue our commitment to aggressively investigate and hold accountable those criminal groups who prey on America’s financial institutions and their customers.”Arakelyan and Vardanyan admitted that in about July 2011 they participated in a scheme to defraud bank account holders and financial institutions by obtaining 952 stolen bank cards and traveling to northern California to withdraw from ATMs as much money as possible using these stolen bank accounts. According to court documents, Arakelyan and Vardanyan possessed two loaded firearms, a GPS device pre-programmed with ATM locations and eight mobile telephones, all to further their scheme.
The information charges that these stolen cards were linked to a 2011 theft of a reported 94,000 debit and credit card account numbers from customers buying goods at 84 Michaels Stores Inc. across the United States. The perpetrators of that security breach replaced about 84 authentic personal identification number pads, used by the stores to process debit and credit card purchases, with fraudulent pads from which they downloaded customers’ banking information. After this breach, financial institutions reported tens of thousands of incidents of fraudulent activity linked to customers who had visited the affected Michaels stores. Arakelyan and Vardanyan are among those who executed one aspect of this scheme.
The conspiracy to commit bank fraud charge and the bank fraud charge each carry a statutory maximum sentence of 30 years in federal prison. The aggravated identity theft charge carries a mandatory additional sentence of two years. The sentencing of Arakelyan and Vardanyan is scheduled for July 24, 2012, before U.S. District Judge Claudia Wilken in Oakland.
This case is being prosecuted by Trial Attorney Paul Rosen of the Fraud Section in the Justice Department’s Criminal Division, and Special Assistant U.S. Attorney Tamara Weber for the Northern District of California. The investigation was conducted by the USSS San Francisco Field Office with substantial support from the USSS Chicago and Los Angeles Field Offices, and from the Glendale and Pleasant Hill, Calif., Police Departments.
This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.gov.
Justice Department Settles with Mountain Valley, Pa., Midget Football League Under the Americans with Disabilities ActRead the Press Release
WASHINGTON – The Justice Department announced it has reached a settlement with the Mountain Valley, Pa., Midget Football League to ensure that children with disabilities are offered an equal opportunity to play youth football.
The settlement resolves a complaint under the Americans with Disabilities Act (ADA) filed by the mother of a seven-year-old boy with ocular albinism, a condition that results in having little or no pigment in the eyes and often causes extreme sensitivity to sunlight. According to the complaint, the league refused the mother’s requests to allow the boy to play football with a helmet that has a tinted visor, which would help to block sunlight. The Justice Department determined that the league violated the ADA by failing to make a reasonable modification of its policies, practices and procedures to permit the boy to use a tinted visor when playing football.
“People with disabilities cannot be denied the full and equal enjoyment of services, privileges and public accommodations, including youth football leagues,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “This settlement is another example of the Justice Department’s commitment to ensure equal access for people with disabilities.”
The settlement agreement requires the league to develop and implement a disability rights policy, to train league officials on the requirements of the ADA and to grant requests for reasonable modifications, like the one at issue here. The league is also required to pay $1,000.00 to the complainant’s family.
The ADA requires public accommodations, like the league, to provide individuals with disabilities equal access to goods, services, privileges, accommodations, facilities, advantages and accommodations. Public accommodations must also make reasonable modifications to their policies, practices or procedures when the modifications are necessary to afford goods, services, facilities, privileges, advantages or accommodations to individuals with disabilities, unless making the modification would cause a fundamental alternation.
Those interested in finding out more about this settlement or the obligations of public accommodations under the ADA 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].