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Wednesday 18 January 2012
Barrio Azteca Gang Member Pleads Guilty in Texas to Racketeering ConspiracyRead the Press Release
WASHINGTON – A Barrio Azteca (BA) gang member pleaded guilty today for his participation in a racketeering conspiracy, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Robert Pitman for the Western District of Texas, FBI Assistant Director of the Criminal Investigative Division Kevin Perkins and Administrator Michele M. Leonhart of the U.S. Drug Enforcement Administration (DEA).
Ricardo Gonzalez, 44, aka “Cuate,” of El Paso, Texas, pleaded guilty before U.S. District Magistrate Judge Norbert J. Garney in the Western District of Texas, El Paso Division, to racketeering conspiracy. A sentencing date has not yet been set by the court. At sentencing, Gonzalez faces a maximum penalty of life in prison.
According to court documents, the Barrio Azteca gang began in the late 1980s as a violent prison gang and has expanded into a transnational criminal organization. The BA is primarily based in West Texas; Juarez, Mexico; and throughout state and federal prisons in the United States and Mexico. The gang has a militaristic command structure and includes captains, lieutenants, sergeants, soldiers and associates – all with the purpose of maintaining power and enriching its members and associates through drug trafficking, money laundering, extortion, intimidation, violence, threats of violence and murder.
According to court documents, members and associates of the BA have engaged in a host of criminal activity committed since Jan. 1, 2003, including drug trafficking, extortion, money laundering, kidnapping and murder, including the March 13, 2010, murders in Juarez of U.S. consulate employee Leslie Ann Enriquez Catton, her husband Arthur Redelfs and Jorge Alberto Salcido Ceniceros, the husband of a U.S. consulate employee.
The BA profits by importing heroin, cocaine and marijuana into the United States from Mexico. Gang members and associates also allegedly charge a “street tax” or “cuota” on businesses and criminals operating in their turf. These profits are used to support gang members in prison by funneling money into prison commissary accounts of gang leaders and to pay for defense lawyers or fines. The “cuota” profits are also allegedly reinvested into the organization to purchase drugs, guns and ammunition.
According to information presented in court, Gonzalez was a BA member who distributed cocaine, marijuana and heroin on the west side of El Paso. Additionally, he collected extortion fees from drug dealers operating on BA turf and knew those fees were funnelled to jailed BA leaders.
Thirty-five members and associates of the BA gang, including Gonzalez and 16 others who have pleaded guilty, were charged in a third superseding indictment unsealed in March 2011 with various counts of racketeering, murder, drug offenses, money laundering and obstruction of justice. Trial is set to begin April 6, 2012.
The case is being prosecuted by Trial Attorney Joseph A. Cooley of the Criminal Division’s Organized Crime and Gang Section, Trial Attorney Brian Skaret of the Criminal Division’s Human Rights and Special Prosecutions Section and the U.S. Attorney’s Office of the Western District of Texas - El Paso Division. The U.S. Attorney’s Office for the District of New Mexico provided significant assistance in this case, including Assistant U.S. Attorney Sarah Davenport. Valuable assistance was provided by the Criminal Division’s Offices of International Affairs and Enforcement Operations.
The case was investigated by the FBI’s El Paso Field Office. Special assistance was provided by the DEA; the Bureau of Alcohol, Tobacco, Firearms and Explosives; Immigration and Customs Enforcement; the U.S. Marshals Service; U.S. Customs and Border Protection; Federal Bureau of Prisons; U.S. Diplomatic Security Service; the Texas Department of Public Safety; the Texas Department of Criminal Justice; El Paso Police Department; El Paso County Sheriff’s Office; El Paso Independent School District Police Department; Texas Alcohol and Beverage Commission; New Mexico State Police; Dona Ana County, N.M., Sheriff’s Office; Las Cruces, N.M., Police Department; Southern New Mexico Correctional Facility and Otero County Prison Facility New Mexico.
Arkansas Man Pleads Guilty to Claiming Fraudulent Tax RefundsRead the Press Release
Philip Butcher pleaded guilty today before U.S. District Judge Patricia Seitz in Miami to filing a false claim for a tax refund, the Justice Department and the Internal Revenue Service (IRS) announced.
Butcher, formerly a resident of Rogers, Ark., admitted that he filed a false 2008 individual income tax return which sought a fraudulent tax refund of $672,781. According to court documents, PMDD Services LLC, an Idaho-based tax preparation firm, prepared the return and filed false IRS Forms 1099-OID with the IRS on Butcher’s behalf. In exchange, Butcher agreed to pay 10 percent of any fraudulent tax refund he received to PMDD Services. Butcher received a fraudulent tax refund of $672,781, paid $67,278 to the principals of PMDD Services, and then filed an amended 2008 individual income tax return, also prepared by PMDD Services, claiming a fraudulent tax refund of $1,456,696.
Butcher faces a maximum potential sentence of 5 years in prison and a $250,000 fine, plus restitution to the Internal Revenue Service.
The indictment against Butcher was originally returned by a grand jury in the Western District of Arkansas. Butcher elected to transfer the case to the Southern District of Florida for his guilty plea and sentencing under Federal Rule of Criminal Procedure 20, which allows a defendant, with the consent of the government, to transfer a case to the district where he is “present” if he states in writing that he intends to plead guilty and be sentenced in that district.
More information about fraud schemes involving Forms 1099-OID is available at the IRS website: www.irs.gov/newsroom/article/0,,id=98129,00.html.
The case was investigated by special agents of IRS-Criminal Investigation and is being prosecuted by Trial Attorneys Jonathan Marx and Jed Silversmith of the Justice Department's Tax Division and by Assistant U.S. Attorney Bertha Mitrani of the Southern District of Florida.Alabama Woman Pleads Guilty to Conspiring to Defraud the United StatesRead the Press Release
The Justice Department and the Internal Revenue Service (IRS) announced that Tracey Fergerson pleaded guilty today before Magistrate Judge Charles S. Coody in Montgomery, Ala., to conspiring to defraud the United States government. Fergerson and a co-defendant were charged by a grand jury in a 22-count indictment that was unsealed on March 30, 2011.
According to the plea agreement, Fergerson participated in a tax fraud scheme that was perpetrated through a tax return preparation business called Fast Tax Cash in Montgomery. From 2005 through 2008, Fergerson recruited customers for Fast Tax Cash and coached them to provide false information in order to fraudulently increase their tax refund amounts. Fergerson also admitted that she improperly obtained personal information, including names and Social Security numbers, and used that personal information to have false tax returns prepared at Fast Tax Cash. Fergerson admitted that she would receive payment for the false refunds that were obtained.
A sentencing date has not yet been set. Fergerson faces a maximum potential sentence of 10 years in prison and fines of up to $250,000.
The case was investigated by the IRS-Criminal Investigation and is being prosecuted by trial attorneys Michael Boteler, Charles M. Edgar Jr. and Michelle M. Petersen of the Justice Department's Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found at www.usdoj.gov/tax .
Tuesday 17 January 2012
Pennsylvania Man Indicted on Child Pornography ChargesRead the Press Release
WASHINGTON – A resident of Washington County, Pa., was indicted today by a federal grand jury in Pittsburgh on charges of possession, production and receipt of materials depicting the sexual exploitation of a minor, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney for the Western District of Pennsylvania David J. Hickton.
Jeffrey W. Herschell, 53, was charged with three counts in a superseding indictment.
According to the superseding indictment, in approximately February 2010, Herschell produced and received files depicting a minor in the Philippines engaging in sexually explicit conduct. Also, on approximately March 14, 2011, Herschell possessed visual depictions of minors engaging in sexually explicit conduct.
Herschell faces a maximum sentence of life in prison and a fine of $750,000.
This case is being prosecuted by Assistant U.S. Attorney Jessica Lieber Smolar of the Western District of Pennsylvania and Trial Attorney Anitha S. Ibrahim of the Child Exploitation and Obscenity Section of the Justice Department’s Criminal Division. Department of Homeland Security, Homeland Security Investigations conducted the investigation leading to the superseding indictment in this case.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov .
New Jersey Pipe Supply Company and Owner Sentenced for Their Role in Fraud and Bribery Conspiracy in Power Generation IndustryRead the Press Release
WASHINGTON — A New Jersey industrial pipe supply company and its owner were sentenced today for participating in a conspiracy to commit fraud and pay bribes to a purchasing manager at Consolidated Edison of New York (Con Ed) in return for the manager’s efforts to steer contracts to the company, the Department of Justice announced.
Bernard Grobart of New York City was sentenced in U.S. District Court in Manhattan by Judge Paul G. Gardephe to serve 60 months in prison and to pay a $125,000 criminal fine. Teneyck Inc., formerly known as Neill Supply Co. Inc. of Lyndhurst, N.J., was sentenced to pay a $550,000 criminal fine. Grobart and Teneyck were also sentenced to pay $297,000 in restitution, jointly and severally with their co-conspirators, to the victim, Con Ed. The company and its owner pleaded guilty on March 23, 2011, to participating in a conspiracy to defraud Con Ed from approximately November 2003 through approximately August 2008. Grobart also pleaded guilty to an obstruction count for instructing a subordinate employee at the company to delete an electronic document that was subpoenaed by the government.
According to court documents, Grobart and Robert D. Rosenberg, a former sales broker for Neill Supply, paid approximately $297,000 in cash bribes to James M. Woodason, a department manager of the purchasing department at Con Ed. In return, Woodason steered Con Ed industrial pipe supply contracts to Neill Supply by secretly providing Neill Supply with confidential competitor bid information, thereby causing Con Ed to pay higher, non-competitive prices for materials. According to court documents, Grobart also directed an employee of Neill Supply to destroy an electronic document that tallied the bribe payments in order to prevent the production of the document to a federal grand jury.
Con Ed is a regulated utility headquartered in Manhattan. It provides electric service to approximately 3.2 million customers and gas service to approximately 1.1 million customers in New York City and Westchester County, N.Y. Con Ed received more than $10,000 in federal funding each year between 2003 through 2010. Con Ed cooperated with the department’s investigation.
Including Grobart and Neill Supply, a total of four individuals and two companies have been charged as part of this investigation. On Dec. 9, 2011, Woodason was sentenced in U.S. District Court in Manhattan by Judge Denise L. Cote to serve 70 months in prison, to pay a $12,500 criminal fine and to pay approximately $528,000 in restitution, jointly and severally with his co-conspirators, to Con Ed. The remaining defendants are awaiting sentencing.
The charges arose from an ongoing federal antitrust investigation of bid rigging, bribery, fraud and tax-related offenses in the power generation industry. The investigation is being conducted by the Antitrust Division’s New York Field Office, with the assistance of the FBI and the Internal Revenue Service-Criminal Investigation. Anyone with information concerning bid rigging, bribery, tax offenses or fraud in the power generation industry should contact the FBI’s New York Division at 212-384-3720 or the Antitrust Division’s New York Field Office at 212-335-8000, or visit www.justice.gov/atr/contact/newcase.htm.
Miami-Area Resident Pleads Guilty to Participating in $200 Million Medicare Fraud SchemeRead the Press Release
WASHINGTON – A Miami-area resident pleaded guilty today in U.S. District Court in Miami for her role in a Medicare fraud scheme that resulted in the submission of more than $200 million in fraudulent claims to Medicare, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).
Sandra Jimenez, 38, admitted to participating in a fraud scheme that was orchestrated by the owners and operators of American Therapeutic Corporation (ATC); its management company, Medlink Professional Management Group Inc.; and the American Sleep Institute (ASI). ATC, Medlink and ASI were all Florida corporations headquartered in Miami. ATC operated purported partial hospitalization programs (PHPs) – a form of intensive treatment for severe mental illness – in seven different locations throughout South Florida and Orlando. ASI purported to provide diagnostic sleep disorder testing.
Jimenez pleaded guilty to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and to pay and receive illegal health care kickbacks. Jimenez was charged in an indictment unsealed on Feb. 15, 2011, in the Southern District of Florida.
According to court filings, ATC’s owners and operators paid kickbacks to owners and operators of assisted living facilities (ALFs) and halfway houses and to patient brokers in exchange for delivering ineligible patients to ATC and ASI. In some cases, the patients received a portion of those kickbacks. Throughout the course of the ATC and ASI conspiracy, millions of dollars in kickbacks were paid in exchange for Medicare beneficiaries, who did not qualify for PHP services, to attend treatment programs that were not legitimate PHPs. ATC and ASI then billed Medicare for the medically unnecessary services. According to court filings, to obtain the cash required to support the kickbacks, the co-conspirators laundered millions of dollars of payments from Medicare.
In pleading guilty, Jimenez admitted that she served as a marketer for ATC and ASI. In this role, Jimenez solicited beneficiaries and paid kickbacks to assisted living facility owners in exchange for the beneficiaries. The amount of the kickback was based on the number of days each patient spent at ATC.
Jimenez also admitted that she participated in a separate Medicare fraud scheme through Priority Home Health, a Miami home health agency that submitted fraudulent claims to Medicare for home health services . Jimenez and her co-conspirators recruited Medicare beneficiaries to Priority Home Health who did not qualify for home health services.
According to the plea agreement, Jimenez’s participation in the ATC fraud and the Priority Home Health fraud resulted in $46 million in fraudulent billings to the Medicare program.
Sentencing for Jimenez is scheduled for June 27, 2012, at 8:30 a.m. Jimenez faces a maximum penalty of 15 years in prison and a $250,000 fine.
ATC, Medlink, and various owners, managers, doctors, therapists, patient brokers and marketers of ATC, Medlink and ASI, were charged with various health care fraud, kickback, money laundering and other offenses in two indictments unsealed on Feb. 15, 2011. ATC, Medlink and nine of the individual defendants have pleaded guilty or have been convicted at trial. Other defendants are scheduled for trial on April 9, 2012, before U.S. District Judge Patricia A. Seitz. A defendant is presumed innocent unless proven guilty beyond a reasonable doubt in a court of law.
Today’s guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; John V. Gillies, Special Agent-in-Charge of the FBI’s Miami field office; and Special Agent-in-Charge Christopher Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami office.
The criminal case is being prosecuted by Trial Attorneys Jennifer L. Saulino and Steven Kim of the Criminal Division’s Fraud Section. A related civil action is being handled by Vanessa I. Reed and Carolyn B. Tapie of the Civil Division and Assistant U.S. Attorney Ted L. Radway of the Southern District of Florida. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force operations in nine locations have charged more than 1,160 defendants that collectively have billed the Medicare program for more than $2.9 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.
Marubeni Corporation Resolves Foreign Corrupt Practices Act Investigation and Agrees to Pay a $54.6 Million Criminal PenaltyRead the Press Release
WASHINGTON – Marubeni Corporation has agreed to pay a $54.6 million criminal penalty to resolve charges related to the Foreign Corrupt Practices Act (FCPA) for its participation in a decade-long scheme to bribe Nigerian government officials to obtain engineering, procurement and construction (EPC) contracts, the Justice Department’s Criminal Division announced today.
The department filed a deferred prosecution agreement and a criminal information today against Marubeni in U.S. District Court for the Southern District of Texas. The two-count information charges Marubeni with one count of conspiracy and one count of aiding and abetting violations of the FCPA. Marubeni is a Japanese trading company headquartered in Tokyo.
According to court documents, Marubeni was hired as an agent by the four-company TSKJ joint venture to help TSKJ obtain and retain EPC contracts to build liquefied natural gas (LNG) facilities on Bonny Island, Nigeria, by offering to pay and paying bribes to Nigerian government officials, among other means. TSKJ was comprised of Technip S.A., Snamprogetti Netherlands B.V., Kellogg Brown & Root Inc. (KBR) and JGC Corporation. Between 1995 and 2004, TSKJ was awarded four EPC contracts, valued at more than $6 billion, by Nigeria LNG Ltd. to build the LNG facilities on Bonny Island. The government-owned Nigerian National Petroleum Corporation was the largest shareholder of NLNG, owning 49 percent of the company.
According to court documents, to assist in obtaining and retaining the EPC contracts, the joint venture hired two agents – Marubeni and Jeffrey Tesler, a U.K. solicitor – to pay bribes to a wide range of Nigerian government officials. The joint venture hired Tesler as a consultant to pay bribes to high-level Nigerian government officials, including top-level executive branch officials, and hired Marubeni to pay bribes to lower-level Nigerian government officials. At crucial junctures preceding the award of EPC contracts, a number of co-conspirators, including on two occasions an employee of Marubeni, met with successive holders of a top-level office in the executive branch of the Nigerian government to ask the office holders to designate a representative with whom TSKJ should negotiate bribes to Nigerian government officials. TSKJ paid approximately $132 million to a Gibraltar corporation controlled by Tesler and $51 million to Marubeni during the course of the bribery scheme and intended for these payments to be used, in part, for bribes to Nigerian government officials.
Under the terms of the deferred prosecution agreement, the department agreed to defer prosecution of Marubeni for two years. Marubeni agreed to retain a corporate compliance consultant for a term of two years to review the design and implementation of its compliance program, to enhance its compliance program to ensure that it satisfies certain standards and to cooperate with the department in ongoing investigations. If Marubeni abides by the terms of the deferred prosecution agreement, the department will dismiss the criminal information when the term of the agreement expires.
“With today’s resolution, the department has held accountable all five of the corporations that participated in the massive, decade-long scheme to bribe Nigerian government officials in connection with the so-called Bonny Island project,” said Mythili Raman, Principal Deputy Assistant Attorney General of the Justice Department’s Criminal Division. “As a result of this extensive investigation, the department and our partners have obtained more than $1.7 billion in penalties and forfeiture orders from the joint venture partners, their agents and individuals who sought illegally to obtain the Bonny Island contracts. Several individuals also have pleaded guilty for their roles in the scheme. Our FCPA enforcement efforts are an essential part of our comprehensive approach to rooting out corruption across the globe.”
In a related criminal case, KBR’s successor company, Kellogg Brown & Root LLC, pleaded guilty in February 2009 to FCPA-related charges for its participation in the scheme to bribe Nigerian government officials. Kellogg Brown & Root LLC was ordered to pay a $402 million fine and to retain an independent compliance monitor for a three-year period to review the design and implementation of its compliance program. In another related criminal case, the department filed a deferred prosecution agreement and criminal information against Technip in June 2010. According to that agreement, Technip agreed to pay a $240 million criminal penalty and to retain an independent compliance monitor for two years. In July 2010, the department filed a deferred prosecution agreement and criminal information against Snamprogetti, which also agreed to pay a $240 million criminal penalty. In April 2011, the department filed a deferred prosecution agreement and criminal information against JGC, in which JGC agreed to pay a $218.8 million criminal penalty and to retain an independent compliance consultant for two years.
In other related criminal cases, KBR’s former CEO, Albert “Jack” Stanley, pleaded guilty in September 2008 to conspiring to violate the FCPA for his participation in the bribery scheme. Tesler and Wojciech J. Chodan, a former salesperson and consultant of a United Kingdom subsidiary of KBR, were indicted in February 2009 on FCPA-related charges for their participation in the bribery scheme. In March 2011, Tesler was extradited from the United Kingdom and subsequently pleaded guilty to conspiring to violate and violating the FCPA and agreed to forfeit $148,964,568. In December 2010, Chodan was extradited from the United Kingdom and subsequently pleaded guilty to conspiring to violate the FCPA and agreed to forfeit $726,885.
The criminal case is being prosecuted by Assistant Chief William J. Stuckwisch and Deputy Chief Patrick F. Stokes of the Criminal Division’s Fraud Section, with investigative assistance from the FBI-Houston Division. The Criminal Division’s Office of International Affairs and the SEC’s Division of Enforcement provided substantial assistance. Significant assistance was provided by authorities in France, Italy, Switzerland and the United Kingdom.
Kentuckians Convicted of Lacey Act Crimes for Illegally Harvesting and Making False Records for Ohio River PaddlefishRead the Press Release
WASHINGTON – Two Kentuckians and their caviar companies pleaded guilty today in the U.S. District Court for the Southern District of Ohio to trafficking in and falsely labeling illegally harvested paddlefish (Polydon spathula). Steve Kinder, along with his wife, Cornelia Joyce Kinder, both of Owenton, Ky., owned and operated Kinder Caviar Inc. and Black Star Caviar Company. Those companies were in the business of exporting paddlefish eggs as caviar to customers in foreign countries.
Paddlefish, whose eggs are marketed as caviar, are protected by both federal and Ohio law. Ohio law prohibits commercial fishing for paddlefish. Ohio law also prohibits the possession or use of gill nets. The Convention on International Trade in Endangered Species of Wild Flora and Fauna (CITES), which is codified in United States law through the Endangered Species Act, regulates international trade in certain species listed on one of three Appendices. Paddlefish are listed on Appendix II of CITES. Appendix II species, or their parts, which were harvested in the United States, may be exported only if they are accompanied by a valid export permit issued by the U.S. Fish & Wildlife Service (USFWS).
Among other things, the Lacey Act makes it a crime to transport or sell fish, or their parts, knowing that the fish were harvested in violation of any state’s law. Among other things, the Lacey Act also makes it a crime to make or submit a false record, account or label for, or false identification of, fish or fish parts which were, or were intended to be, exported, transported or sold.
According to the plea agreement filed in U.S. District Court in Cincinnati, Cornelia Joyce Kinder admitted to making false statements on behalf of Kinder Caviar in a CITES Export Registration Form for paddlefish eggs on or about March 15, 2007. Specifically, Cornelia Joyce Kinder misrepresented the amount of legally-harvested paddlefish eggs that she could provide documentation for, as well as misidentified the fishermen who harvested the paddlefish and the location of harvest.
As part of a plea agreement, Cornelia Joyce Kinder also admitted to making false statements on behalf of Black Star Caviar Company in a CITES Export Registration Form for paddlefish eggs on or about Dec. 18, 2010. Specifically, Cornelia Joyce Kinder completed the form using the name of a subordinate employee and forged that employee’s signature on the form in order to give the impression that she was not the applicant.
According to the plea agreement, both Steve Kinder and Cornelia Joyce Kinder admitted to aiding and abetting one another in harvesting paddlefish in Ohio waters, using gill nets attached to the Ohio shoreline, on or about May 5, 2007, and transporting the paddlefish to Kentucky with the intent to sell them when, in the exercise of due care, they should have known that the fish were harvested in violation of Ohio law.
As part of a plea agreement, both Kinder Caviar and Black Star Caviar Company have each agreed to pay a $5,000 fine and serve a three-year term of probation, during which time those companies will be prohibited from applying for or receiving a CITES Export Permit. In addition, both Steve Kinder and Cornelia Joyce Kinder have agreed to serve a three-year term of probation, during which time they will each perform 100 hours of community service, be prohibited from fishing anywhere in the Ohio River where that river forms the border between Ohio and Kentucky, and be prohibited from applying for or receiving a CITES Export Permit, either on behalf of themselves or anyone else. In accordance with Kentucky law, both Steve Kinder and Cornelia Joyce Kinder face possible suspension of their Kentucky commercial fishing licenses.
Also as part of the plea agreement, the boat and truck that were used in furtherance of the Lacey Act crimes have been forfeited.
The case was investigated by the USFWS Office of Law Enforcement; the Ohio Department of Natural Resources, Division of Wildlife; and the Kentucky Department of Fish & Wildlife Resources. The case was prosecuted by Trial Attorney James B. Nelson of the Department of Justice’s Environmental Crimes Section of the Environment and Natural Resources Division, and Assistant U.S. Attorney Laura I. Clemmens of the Southern District of Ohio.
Former Employee and Contractors of Florida Property Management Company Indicted in Illinois for Conspiracy to Commit Bribery and Wire FraudRead the Press Release
WASHINGTON – A Rockford, Ill., grand jury today indicted a former residential sales manager and two former contractors of a Florida property management company in connection with housing repair contracts for the U.S. Department of Veterans Affairs (VA), the Department of Justice announced.
The 10-count indictment filed today in U.S. District Court in Rockford charged Ryan J. Piana, Ronald B. Hurst and Bryant A. Carbonell with conspiring to commit bribery and wire fraud from beginning at least as early as January 2006 continuing until as late as September 2007. Piana, Hurst and Carbonell are also charged with bribery and wire fraud.
Piana is a former residential sales manager at West Palm Beach, Fla.-based Ocwen Loan Servicing LLC, and Hurst and Carbonell are former contractors for Ocwen. According to court documents, Ocwen managed foreclosed properties under contract with the VA, which guaranteed qualifying residential mortgages for veterans. Under the contract between the VA and Ocwen, if a veteran defaulted, Ocwen completed necessary repairs and re-sold the property.
Proceeds from the re-sale of VA-acquired properties directly benefit the VA by reducing the cost of guaranteeing residential mortgages to veterans.
According to the charges, Hurst and Carbonell paid Piana to steer housing repair work to companies affiliated with Hurst and Carbonell. Piana recruited other Ocwen employees into the scheme and paid them on behalf of himself and the other conspirators. The department said in order to execute the scheme, the conspirators sent, or caused to be sent, various transmissions via wire communication.
This is the second case involving properties managed by Ocwen under contract with the VA. On Dec. 3, 2010, Benjamin K. Graves, also a former Ocwen employee, pleaded guilty in U.S. District Court in Orlando, Fla., to wire fraud in connection with the VA contract.
The wire fraud charges carry a maximum penalty of 20 years in prison; the bribery charges carry a maximum penalty of 15 years in prison; and the conspiracy charge carries a maximum penalty of five years in prison. The maximum fine for each charge is $250,000. For wire fraud and conspiracy, the maximum fine 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. For bribery, the maximum fine may be increased to three times the value of the bribes, if that amount is greater than the statutory maximum fine.
The charges announced today resulted from an ongoing federal investigation of housing repair contracts performed under contract with the VA. The investigation is being conducted by the Antitrust Division' s Chicago Field Office and the Central Field Office of the U.S. Department of Veterans Affairs, Office of Inspector General, Criminal Investigations Division, located in Hines, Ill. Anyone with information concerning suspicious activity relating to housing repairs performed under a contract with the VA should contact the Antitrust Division' s Chicago Field Office at 312-353-7530 or visit www.justice.gov/atr/contact/newcase.htm.
Friday 13 January 2012
Maryland Man Pleads Guilty to Child Pornography Production Charges in Indiana and Is Sentenced to 33 Years in PrisonRead the Press Release
A Maryland man pleaded guilty today in federal court in Indianapolis to seven counts of child pornography production and was sentenced to 33 years in prison and a lifetime of supervised release, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Joseph H. Hogsett of the Southern District of Indiana.
Trevor J. Shea, 21, of Mechanicsburg, Md., pleaded guilty before U.S. District Judge William T. Lawrence in the Southern District of Indiana.
During today’s plea and sentencing hearing, Shea admitted to using blackmail to coerce 10 minor girls between the ages of 13 and 16 years to produce images and videos of themselves engaging in sadistic and masochistic abuse and other sexually explicit conduct.
According to court documents, the case arose from an investigation by the Brownsburg, Ind., Police Department, which received a complaint in late September 2009 that Jane Doe 1, a 16-year-old girl, was being stalked via the internet. Jane Doe 1 and a family member reported that several months earlier, Jane Doe 1 and two other female minors visited an online webcam site where they exposed their breasts to unknown webcam viewers.
Approximately one week later, Jane Doe 1 began receiving emails and instant messages from Shea, who threatened to post the nude images of Jane Doe 1 and her friends to the internet. Shea told Jane Doe 1 that if she produced more images and/or webcam videos for him, he would not post the photos for others to see. Jane Doe 1 complied with some of these demands, and produced images and videos of herself engaging in sexually explicit conduct. She then transmitted the images and videos to him.
Working with the U.S. Postal Inspection Service (USPIS), the Brownsburg Police Department traced the internet communications and a federal search warrant was obtained and executed at Shea’s Maryland home on March 4, 2010. Evidence was recovered during that search showing that numerous females around the country were victimized by Shea in a manner virtually identical to Jane Doe 1. Five of these other victims were identified as minor girls.
On June 9, 2010, Shea was indicted on four counts of production of child pornography for his conduct against Jane Doe 1. Shea made an initial appearance on these charges and was released to his Maryland home on conditions, including home detention with electronic monitoring and a prohibition on his use of a computer or the Internet.
In early November 2010, while Shea was on pretrial release, the Santa Rosa County, Fla., Sheriff’s Department interviewed “Jane Doe 2,” a 16-year-old girl. Jane Doe 2 reported that in 2009, an individual, later determined to be Shea, threatened her via the internet and coerced her to produce nude images. The search of Shea’s residence in March 2010 recovered images of Jane Doe 2 from Shea’s computer, but she had not yet been identified by law enforcement. Jane Doe 2 reported that in November 2010, she was contacted again by the individual, who threatened to disseminate the nude images that he previously had obtained from her, and demanded new nude images. In response to this threat, Jane Doe 2 made videos that depicted herself engaging in sexually explicit conduct and emailed them to Shea.
Following Jane Doe 2’s report in November 2010, investigators determined that the email account to which Jane Doe 2 had been coerced to send the images and videos of herself was being accessed by an individual at Shea’s residence. Florida law enforcement coordinated with the Brownsburg Police Department and USPIS, and a federal search warrant was executed at Shea’s residence on Dec. 22, 2010. Shea was arrested again that day, detained, and he has since remained in custody.
Investigators determined that in addition to Jane Doe 2, Shea similarly victimized three other minor girls in November and December 2010 while he was on pretrial release. On Sept. 13, 2011, Shea was charged with three additional counts of production of child pornography for his conduct against these four minor girls.
The case against Shea was prosecuted by Assistant U.S. Attorney A. Brant Cook of the Southern District of Indiana and Trial Attorney Bonnie L. Kane of the Child Exploitation and Obscenity Section (CEOS) in the Justice Department’s Criminal Division.
The case was investigated by the Brownsburg Police Department, USPIS, Indiana State Police, Santa Rosa County Sheriff’s Department, and the Indiana Internet Crimes Against Children Task Force . Substantial assistance was provided by the Federal Bureau of Investigation, the Child Exploitation and Obscenity Section’s High Technology Investigative Unit, and Maryland State Police.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s 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.
Louisiana Health Care Company Owner and Recruiter Plead Guilty to Medicare Fraud SchemeRead the Press Release
WASHINGTON – Two Baton Rouge, La., residents have pleaded guilty for their role in a Medicare fraud scheme, which allegedly involved more than $21 million, announced the Department of Justice, the Department of Health and Human Services (HHS), the FBI and the Louisiana State Attorney General’s Office.
Henry Jones, the owner of four medical equipment companies, pleaded guilty yesterday before U.S. District Judge James J. Brady in the Middle District of Louisiana to one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and to pay and receive healthcare kickbacks. Mary Bessie, one of Jones’ co-conspirators, pleaded guilty on Jan. 11, 2012, before Judge Brady to one count of conspiracy to defraud the United States and to pay and receive healthcare kickbacks.
Jones admitted that between 2004 and 2009, he owned and operated four companies that were licensed to supply durable medical equipment (DME) to Medicare beneficiaries. Jones hired patient recruiters to obtain prescriptions for medical equipment that was medically unnecessary. The patient recruiters obtained beneficiary information and then asked the beneficiaries’ primary care physicians for prescriptions for orthotic equipment, power wheelchairs, wheelchair accessories and other medical equipment. When the beneficiaries’ physicians were unwilling to provide medically unnecessary prescriptions, the patient recruiters asked other physicians to write prescriptions based on cursory examinations of the patients. The recruiters then provided the prescriptions to Jones, who billed them to Medicare and paid the recruiters illegal kickbacks for each prescription obtained.
Bessie admitted that from 2004 to 2009, she and her co-conspirators solicited and received kickbacks from Jones in return for medically unnecessary prescriptions for Medicare beneficiaries. From 2004 to 2009, Bessie was paid kickbacks, and Bessie aided and abetted the payment of kickbacks in the form of checks totaling $82,230.
Sentencing dates have not yet been set. The maximum prison sentence for each count of conspiracy to commit health care fraud is 10 years. The maximum prison sentence for each count of conspiracy to defraud the United States and to pay and receive health care kickbacks is five years.
The pleas were announced today by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Donald J. Cazayoux Jr. of the Middle District of Louisiana; Mike Fields, Special Agent-in-Charge of 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 Louisiana State Attorney General James Buddy Caldwell.
The case is being prosecuted by Trial Attorneys David Maria and Abigail Taylor and Assistant Chief William Pericak of the Criminal Division’s Fraud Section. The case was investigated by the FBI, HHS-OIG and the Medicaid Fraud Control Unit of the Louisiana State Attorney General’s Office (MFCU), 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 Middle District of Louisiana.
Since its inception in March 2007, the Medicare Fraud Strike Force operations in nine locations have charged more than 1,160 defendants that collectively have billed the Medicare program for more than $2.9 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 .
Justice Department Settles with Warren, Ohio, Police DepartmentRead the Press Release
WASHINGTON – Following a comprehensive investigation, the Justice Department today announced that it has resolved its investigation of the city of Warren, Ohio, Police Department (WPD) through a settlement agreement filed with the U.S. District Court.
The investigation focused on whether WPD engages in unconstitutional or unlawful policing through the use of excessive force. WPD cooperated throughout the investigation. The Justice Department found reasonable cause to believe that WPD engages in a pattern or practice of excessive force in violation of the Fourth Amendment of the U.S. Constitution and the Violent Crime Control and Law Enforcement Act of 1994. The Justice Department, WPD and city of Warren officials reached an agreement that, once implemented, will resolve the Justice Department’s investigation. To create sustainable reform, the agreement requires WPD to continue to develop and implement:
- new use of force policies and protocols;
- systems to ensure that uses of force are documented and evaluated;
- systems to track citizen complaints and ensure they are investigated promptly; and
- officer training on conducting effective and constitutional policing.
“Effective policing and constitutional policing go hand in hand. Developing and implementing meaningful reforms through this cooperative agreement will assist in reducing crime, upholding the Constitution and ensuring that the community has confidence in the police department’s commitment to fair and effective law enforcement,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The issues within the Warren Police Department have been present for many years and will take time to fix, but we look forward to continuing our positive partnership with the people of Warren, Mayor Doug Franklin, Police Chief Tim Bowers and his officers to implement sustainable reform.”
“This agreement puts in place a structure in which officers will be trained on appropriate use of force and citizens can register complaints if they feel they’ve been mistreated,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio. “I am confident that the Justice Department and Warren officials will continue to work cooperatively to insure the safety of the officers and people of Warren.”
The Justice Department’s investigation involved an in-depth review of WPD documents, as well as extensive community engagement. The department reviewed thousands of pages of documents, including written policies and procedures, training materials and internal reports; data; video footage; and investigative files. Justice Department attorneys and investigators also conducted interviews with WPD officers, supervisors, command staff and city officials, and conducted interviews with community members and local advocates. Throughout the investigation, the Justice Department provided feedback and technical assistance to WPD, and in response, WPD has already begun to implement a number of remedial measures.
This investigation was conducted jointly by the Special Litigation Section of the Civil Rights Division and the U.S. Attorney’s Office for the Northern District of Ohio, with the assistance of law enforcement professionals, including former police chiefs. For more information on the Justice Department’s Civil Rights Division, please visit www.justice.gov/crt.
If you have any comments or concerns, please feel free to contact us at1-877-218-5228.
Former L.A. County Sheriff's Deputy Agrees to Plead Guilty to Federal Corruption ChargeRead the Press Release
WASHINGTON – A former Los Angeles County Sheriff's deputy was charged today with agreeing to accept $20,000 in bribes in exchange for smuggling contraband into the Men's Central Jail, announced Thomas E. Perez, Assistant Attorney General for the Civil Rights Division, and André Birotte Jr., U.S. Attorney for the Central District of California
In a criminal information filed in U.S. District Court in Los Angeles, Gilbert Michel, 38, was charged with one count of bribery of a public official.
In a plea agreement also filed today, Michel agreed to plead guilty to the charge and to cooperate in an ongoing investigation.
Michel, who resigned from the Los Angeles Sheriff's Department (LASD) in September 2011, was assigned to the Men's Central Jail in downtown Los Angeles. The criminal information charges that the LASD is a local organization which receives federal funds and that Michel, as deputy sheriff, was responsible for the care, custody and security of inmates housed at the jail.
In the plea agreement, Michel admits that he agreed to accept $20,000 in cash in exchange for smuggling contraband into the jail for delivery to an inmate. The contraband included a cell phone, cigarettes and a note, which in jail parlance is called a "kite."
The charge of bribery of a public official carries a statutory maximum penalty of 10 years in federal prison.
Michel is expected to make his initial court appearance in this case on Jan. 17, 2012.
The case against Michel is part of an ongoing investigation being conducted by the FBI. The case is being prosecuted by the U.S. Attorney's Office for the Central District of California in conjunction with the Justice Department’s Civil Rights Division.
Former Dow Research Scientist Sentenced to 60 Months in Prison for Stealing Trade Secrets and PerjuryRead the Press Release
WASHINGTON – A former research scientist was sentenced late yesterday to 60 months in prison for stealing trade secrets from Dow Chemical Company and selling them to companies in the People’s Republic of China, as well as committing perjury, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Donald J. Cazayoux Jr. for the Middle District of Louisiana.
U.S. District Court Judge James J. Brady also sentenced Wen Chyu Liu, aka David W. Liou, 75, of Houston, to two years of supervised release and ordered him to forfeit $600,000 and pay a $25,000 fine. A federal jury in Baton Rouge, La., convicted Liu on Feb. 7, 2011, of one count of conspiracy to commit trade secret theft and one count of perjury.
According to the evidence presented in court, Liu came to the United States from China for graduate work. He began working for Dow in 1965 and retired in 1992. Dow is a leading producer of the elastomeric polymer, chlorinated polyethylene (CPE). Dow’s Tyrin CPE is used in a number of applications worldwide, such as automotive and industrial hoses, electrical cable jackets and vinyl siding.
While employed at Dow, Liu worked as a research scientist at the company’s Plaquemine, La., facility on various aspects of the development and manufacture of Dow elastomers, including Tyrin CPE. Liu had access to trade secrets and confidential and proprietary information pertaining to Dow’s Tyrin CPE process and product technology. The evidence at trial established that Liu conspired with at least four current and former employees of Dow’s facilities in Plaquemine and Stade, Germany, who had worked in Tyrin CPE production, to misappropriate those trade secrets in an effort to develop and market CPE process design packages to various Chinese companies.
Liu traveled extensively throughout China to market the stolen information, and evidence introduced at trial showed that he paid current and former Dow employees for Dow’s CPE-related material and information. In one instance, Liu bribed a then-employee at the Plaquemine facility with $50,000 in cash to provide Dow’s process manual and other CPE-related information.
In addition, according to evidence presented at trial related to the perjury charge, Liu falsely denied during a deposition that he made arrangements for a co-conspirator to travel to China to meet with representatives of a Chinese company interested in designing and building a new CPE plant. Liu was under oath at the time of the deposition, which was part of a federal civil suit brought by Dow against Liu.
The case is being prosecuted by Assistant U.S. Attorney Corey R. Amundson, who serves as the Senior Deputy Criminal Chief, and former Assistant U.S. Attorney Ian F. Hipwell for the Middle District of Louisiana, as well as Trial Attorney Kendra Ervin of the Criminal Division’s Computer Crime and Intellectual Property Section. The case was investigated by the FBI’s New Orleans Division.
Federal Officials Close the Investigation into the Death of Native American Woodcarver in Washington StateRead the Press Release
The U.S. Justice Department and the U.S. Attorney’s Office for the Western District of Washington announced today that they are closing the federal criminal civil rights investigation of a former Seattle Police Department Officer for the fatal shooting of the late Native American woodcarver John T. Williams, and that charges will not be filed.
Officials from the Justice Department’s Civil Rights Division, the U.S. Attorney’s Office and the FBI met today with the brother of the late Mr. Williams and family representatives to inform them of this decision.
The Justice Department conducted a comprehensive and independent investigation of the events surrounding the fatal shooting on Aug. 30, 2010. Federal investigators reviewed the patrol car videos of the incident; the testimony and exhibits admitted at the two-week King County, Wash., Superior Court inquest into this fatal shooting; the interrogatories filled out by the inquest jurors at the completion of the inquest; the report of the Seattle Police Department’s Firearms Review Board; the Seattle Police Department’s homicide investigative file, including all the eyewitness and forensic evidence; the King County Prosecuting Attorney’s Office’s memorandum declining state homicide charges; and the involved officer’s personnel and training files. Federal investigators visited the scene and also conducted interviews of civilian and law enforcement witnesses.
Under the applicable federal criminal civil rights laws, prosecutors must establish, beyond a reasonable doubt, that a law enforcement officer willfully deprived an individual of a constitutional right, meaning with the deliberate and specific intent to do something the law forbids. This is the highest standard of intent imposed by law. Accident, mistake, fear, negligence or bad judgment is not sufficient to establish a federal criminal civil rights violation. After a careful and thorough review, a team of experienced federal prosecutors and FBI agents determined that the evidence was insufficient to prove, beyond a reasonable doubt, that the former Seattle Police Officer acted willfully and with the deliberate and specific intent to do something the law forbids.
Accordingly, the investigation into this incident has been closed without prosecution.
The Civil Rights Division, the U.S. Attorney’s Office for the Western District of Washington and the FBI devoted significant time and resources into conducting a thorough and independent investigation. The Justice Department is committed to investigating allegations of excessive force by law enforcement officers and will continue to devote the resources required to ensure that all serious allegations of civil rights violations are fully and completely investigated. The department aggressively prosecutes criminal civil rights violations whenever there is sufficient evidence under the legal standard imposed by law.
Thursday 12 January 2012
Utah Chiropractor Convicted of Attempted Evasion of Payment of Income TaxRead the Press Release
Madsen, a chiropractor from Ephraim, Utah, was convicted today after a jury trial in the U.S. District Court in Salt Lake City of income tax evasion, the Justice Department announced.
According to court documents, Madsen owed more than $1.3 million in assessed income tax, interest and penalties for the years 1995, 1999, 2000, 2001, 2002, 2003 and 2004. According to court documents, Madsen’s tax debt had grown to more than $1.7 million, after accrued interest. The evidence presented at trial showed that Madsen failed to file a tax return for the last 10 years, and also failed to make any voluntary payments on his tax debt for the past decade.
According to court documents, Madsen used nominee trusts to conceal the ownership of property, ultimately causing the transfer of that property to Grand Scale Inc., a Washington corporation of which he was the president, vice president, secretary, treasurer and chairman of the board. In addition, Madsen used other entities to encumber property and cloud equity in that property, using entities such as Entry Level and Willow Valley Trust. According to court documents, Madsen also attempted to obstruct Internal Revenue Service (IRS) levies, on two occasions sending letters to the purchaser of his chiropractic business, once threatening the possibility of felony charges. Madsen was previously held in civil contempt by the U.S. District Court, for failure to comply with court orders with respect to an IRS Madsen faces a potential maximum sentence of 5 years in prison and a fine of up to $250,000, or twice the gross gain or loss resulting from the offense.
Trial Attorneys Jennifer R. Laraia and Leslie A. Goemaat from the Tax Division prosecuted this case on behalf of the United States. The case was investigated by the IRS-Criminal Investigation’s Salt Lake Field Office.
Owner and Patient Recruiter Sentenced to Prison for Roles in $4.7 Million Louisiana Medicare Fraud SchemeRead the Press Release
WASHINGTON – An owner and a patient recruiter for a Louisiana durable medical equipment (DME) company were sentenced today to 60 and 55 months in prison, respectively, for their roles in a $4.7 million Medicare fraud scheme, announced the Department of Justice, the Department of Health and Human Services (HHS), the FBI and the Louisiana State Attorney General’s Office.
Nnanta Felix Ngari, the owner and operator of Unique Medical Solutions, and Ernest Payne, a patient recruiter for Unique, were also sentenced by U.S. District Judge James J. Brady of the Middle District of Louisiana to serve two years of supervised release following their prison terms. Ngari and Payne’s co-conspirator, Sofjan Lamid, was sentenced today by Judge Brady to three years of probation. Ngari, Payne and Lamid were also ordered to pay $2.5 million in restitution, jointly and severally with co-defendants.
On Aug. 16, 2011, after a two-week trial, a jury convicted Ngari, Payne and Lamid of one count of conspiracy to commit health care fraud and one count of conspiracy to defraud the United States and to pay and receive illegal health care kickbacks.
Evidence at trial established that Ngari owned and operated Unique Medical Solution Inc., a Baton Rouge, La.-area DME supply company that specialized in the provision of power wheelchairs to Medicare beneficiaries. Beginning in late 2003, Ngari paid recruiters, including Payne, to locate and solicit prescriptions for medically unnecessary power wheelchairs, which Ngari used as a basis to submit false and fraudulent claims, on behalf of Unique, to Medicare. As part of the scheme, Payne used churches and other Baton Rouge locations to host “health fairs,” at which Medicare beneficiaries would be prescribed medically unnecessary power wheelchairs by doctors, including Lamid. Lamid and the other physicians were paid illegal kickbacks by recruiters based on the number of power wheelchair prescriptions generated at the health fairs. Payne, likewise, was paid kickbacks by Ngari based on the number of prescriptions he brought to Unique.
Between 2003 and 2009, Unique submitted approximately $4.7 million in claims to Medicare for their purported services. Medicare paid Unique approximately $2.5 million for its claims.
Today’s sentences were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s 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 Louisiana State Attorney General James Buddy Caldwell.
The case was prosecuted by former Assistant Chief Ben Curtis and Trial Attorney David Maria of the Criminal Division’s Fraud Section. The case was investigated by the FBI, HHS-OIG and the Medicaid Fraud Control Unit of the Louisiana State Attorney General’s Office (MFCU), 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 Middle District of Louisiana.
Since its inception in March 2007, the Medicare Fraud Strike Force operations in nine locations have charged more than 1,160 defendants that collectively have billed the Medicare program for more than $2.9 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.
Deputy US Marshal in Chicago Indicted for Civil Rights ViolationsRead the Press Release
WASHINGTON - A federal grand jury in Chicago returned an indictment today charging Deputy U.S. Marshal Stephen Linder, 36, with violations of federal criminal civil rights law related to two separate incidents in which Linder assaulted a handcuffed civilian.
The indictment charges Linder with a criminal civil rights violation for punching and choking a handcuffed man on July 8, 2010, and with obstructing justice for attempting to persuade another law enforcement officer to withhold evidence of the assault. Linder was also charged with a criminal civil rights violation for head-butting a handcuffed man on May 13, 2008, and with obstructing justice by persuading another law enforcement officer to withhold evidence of the assault.
Each of the civil rights counts carries a maximum sentence of 10 years in prison. Each of the obstruction counts carries a maximum sentence of 20 years in prison. Each count in the indictment also carries a maximum fine of $250,000.
An indictment is merely an accusation and the defendant is presumed innocent unless proven guilty.
This case is being investigated by the Department of Justice’s Office of the Inspector General and is being prosecuted by the Civil Rights Division of the Department of Justice.
Attorney General Holder to Speak at Utah Martin Luther King Jr. Human Rights Commission LuncheonRead the Press Release
Attorney General Eric Holder will deliver the keynote speech at the Utah Martin Luther King Jr. Human Rights Commission Luncheon TOMORROW, FRIDAY, JAN. 13, 2012, at 12:00 p.m. MST.
WHO: Attorney General Eric Holder
WHAT: Deliver the keynote speech at the Utah Martin Luther King Jr. Human Rights Commission Luncheon
WHEN: TOMORROW, FRIDAY, JAN. 13, 2012
2:00 p.m. EST/
12:00 p.m. MST
WHERE: Sheraton Hotel
150 W. 500 South St.
Salt Lake CityOPEN PRESS
NOTE: Media interested in attending must RSVP to Cody Craynor at 801-793-0460 or [email protected]. All media must present government-issued photo I.D. (such as a driver’s license) as well as valid media credentials. Press inquiries regarding logistics should be directed to the Office of Public Affairs at 202-514-2007.
Wednesday 11 January 2012
Oklahoma Inmate Pleads Guilty to Conspiring with Jailer to Assault Another InmateRead the Press Release
WASHINGTON – Phillip Oliver, 46, an inmate at the Muskogee County, Okla., Jail (MCJ) pleaded guilty today in U.S. District Court in Muskogee to one count of conspiracy related to the orchestrated beating of a fellow inmate at the behest of an unnamed jailer on duty.
During today’s hearing, Oliver admitted that on Oct. 6, 2011, he conspired with a jailer on duty to violate the civil rights of the victim, a fellow inmate, by assaulting him. Specifically, Oliver and the jailer agreed to use physical violence to punish the victim, who was restrained in a separate cell, because the victim was making verbal comments. According to court documents, although Oliver was concerned about getting into trouble if he assaulted the victim, the jailer assured Oliver that he would cover for him. Thereafter, the jailer remotely popped open the victim’s locked cell door so that Oliver could gain access. Oliver then punched the victim in the face, all at a time when the victim was not posing a threat to anyone.
“Violence for the purpose of punishment is a clear violation of the law and will not be tolerated,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Justice Department will continue to vigorously prosecute anyone who violates federal criminal civil rights laws.”
Oliver faces up to five years in prison. A sentencing date has not been set.
This case is being investigated by the Muskogee Resident Agency of the Oklahoma City Division of the FBI and is being prosecuted by Assistant U.S. Attorney Ryan M. Roberts for the Eastern District of Oklahoma and Trial Attorney Fara Gold of the Civil Rights Division of the U.S. Department of Justice.
The department’s investigation involving this matter remains ongoing.
Korean Shipping Company, Chief Engineer and Assistant Engineer Convicted in Hawaii for Environmental CrimesRead the Press Release
WASHINGTON – Keoje Marine Co. Ltd. and two engineers from the M/T Keoje Tiger pleaded guilty yesterday in federal court in Honolulu to environmental crimes violations, announced Environment and Natural Resources Division Assistant Attorney General Ignacia S. Moreno and U.S. Attorney Florence T. Nakakuni.
Keoje Marine was sentenced to pay a $1.15 million criminal penalty, $250,000 of which will go to the National Fish and Wildlife Foundation as a community service payment for projects aimed at protecting and restoring marine resources in the District of Hawaii. Keoje Marine pleaded guilty to three felonies: violating the Clean Water Act for the dumping of oily bilge waste into waters off Hawaii that may have affected the natural resources of the United States, violating the Act to Prevent Pollution from ships for covering up the dumping of the oily waste by falsifying the vessel’s oil record book and obstruction of justice during a U.S. Coast Guard inspection of the M/T Keoje Tiger in October 2011.
“Keoje and two of its senior ship engineers violated U.S. laws that protect our treasured oceans and critical marine habitats from harm,” said Assistant Attorney General Moreno. “The shipping industry is crucial to global commerce, but it is also subject to U.S. and international laws that protect the ocean from all-too-common and illegal practices exhibited by the defendant. This substantial penalty should demonstrate to the shipping industry that those who illegally dump in U.S. waters, or who compound their crime by lying to the U.S. Coast Guard, will be investigated, prosecuted and held fully accountable.”
“Enforcing the environmental laws in Hawaii is a high priority for this Office,” said U.S. Attorney Nakakuni. “This case shows our commitment to aggressively investigate and prosecute violators of those laws. Further, this case will help us improve our environment by mandating that $250,000 of the corporation’s fine be used to improve Hawaii’s coral reefs. Overall, this case is an important victory for those of us who cherish Hawaii.”
“The swift resolution of this case sends a clear message that the federal government is committed to protecting the marine environment,” said Capt. Joanna Nunan, U.S. Coast Guard Sector Honolulu commander. “A substantial portion of this $1.15 million settlement will go to preserve Hawaii's coral reefs, while sending a stern message to potential violators.”
Keoje Marine owned and operated the M/T Keoje Tiger, a 4,228 gross ton oil tanker that brought fuel and supplies to fishing vessels in the South Pacific as a “floating gas station.” According to the plea agreement, during a voyage to Hawaii that ended in Honolulu on Oct. 12, 2011, certain crewmembers from the vessel knowingly discharged oil in the form of oily bilge waste into the exclusive economic zone of the United States in quantities that may have been harmful to the natural resources of the United States. This was accomplished through the use of a bypass or “magic hose” that was connected from pumps in the engine room to a valve that lead directly overboard into the sea, bypassing the oil water separator, a required piece of pollution prevention equipment. Oily bilge waste was discharged from the vessel routinely from March to October 2011. The practice onboard the vessel was uncovered by U.S. Coast Guard inspectors after receiving a tip from a crewmember.
All discharges of 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/T Keoje Tiger.
The chief engineer of the vessel, Bong Seob Bag, 54, pleaded guilty to falsifying the vessel’s oil record book and failing to record that oily bilge waste had been directly discharged into the sea. Bag was the senior-most engineer on the vessel and in charge of the operations in the engine room, and he was required to maintain an accurate oil record book. Bag was sentenced to three years of probation during which he is banned from entering the United States.
First Assistant Engineer Dwintoro, 46, also pleaded guilty for his role in causing the oil record book to be false. Dwintoro was in charge of the daily operations in the engine room and on numerous occasions directed that the “magic hose” be hooked up to discharge oily waste directly into the sea. Dwintoro was sentenced to three years of probation during which he is banned from entering the United States.
In addition to the fine and community service payment, Keoje Marine will be required to implement an environmental compliance plan which will ensure that any ship operated by the company complies with all maritime environmental requirements established under applicable international, flag state and port state laws. The plan ensures that Keoje Marine employees and the crew of any vessel operated by it are properly trained in preventing maritime pollution. An independent monitor will report to the court about the company’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 Ken Nelson in the Environmental Crimes Section of the Environment and Natural Resources Division of the Department of Justice and by Marshall Silverberg, Assistant U.S. Attorney for the District of Hawaii.
Former Milwaukee Police Officer Convicted of Civil Rights Violation for Sexual Assault of Milwaukee WomanRead the Press Release
WASHINGTON – A federal jury today convicted Ladmarald Cates, 44, a former Milwaukee Police Officer, of a civil rights charge stemming from his July 16, 2010, sexual assault of a Milwaukee woman, the Justice Department announced.
The evidence at trial established that on July 16, 2010, the defendant, while acting as a Milwaukee police officer, responded to a 911call for police assistance at the victim’s home. The defendant then used a combination of coercion and intimidation to force the victim to commit sexual acts before forcibly raping her, while they were alone together in the residence. Law enforcement and civilian witnesses testified that the victim cried out that she had been raped minutes after the sexual assault occurred.
“Officers are charged with protecting and serving our community,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “When officers use their power to take advantage of some of the most vulnerable individuals in our society, the Department of Justice will aggressively prosecute.”
“The federal conviction of a former Milwaukee police officer for violating an individual’s civil rights demonstrates the Department of Justice’s commitment to the investigation and prosecution of those who would use their authority and influence to prey on the very citizens they have sworn to protect,” said James L. Santelle, U.S. Attorney for the Eastern District of Wisconsin. “By pursuing allegations of injustice, including those against law enforcement officers, the Department of Justice can improve public trust and confidence in the law enforcement community.”
Following an internal investigation, the Milwaukee Police Department fired Mr. Cates.
The defendant faces a maximum penalty of life in prison. The sentencing is scheduled for April 11, 2012, before the Honorable J.P. Stadtmueller, U.S. District Judge for the Eastern District of Wisconsin.
The prosecution of this case was based upon the cooperation and support of the Milwaukee Police Department, which worked closely with the FBI in the investigation of it. The case was prosecuted by Assistant U.S. Attorney Mel. S. Johnson and Trial Attorney Saeed Mody of the Criminal Section of the Civil Rights Division of the U.S. Department of Justice.
50 Individuals Charged in Puerto Rico with Allegedly Trafficking Identities of Puerto Rican Us CitizensRead the Press Release
WASHINGTON – Fifty individuals were charged in an indictment unsealed today in Puerto Rico with conspiracy to commit identification fraud in connection with their alleged roles in a scheme to traffic the identities of Puerto Rican U.S. citizens and corresponding identity documents.
The charges were announced today by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Rosa E. Rodríguez-Vélez for the District of Puerto Rico; Director John Morton of U.S. Immigration and Customs Enforcement (ICE), which oversees Homeland Security Investigations (HSI); Chief Postal Inspector Guy Cottrell of the U.S. Postal Inspection Service (USPIS); Scott P. Bultrowicz, Director of the U.S. State Department’s Diplomatic Security Service; and Internal Revenue Service-Criminal Investigation (IRS-CI) Acting Chief Rick Raven.
The one-count indictment was returned by a federal grand jury on Dec. 29, 2011, and unsealed today. Defendants were arrested today in multiple districts throughout the United States and Puerto Rico and will make initial appearances in federal court in the districts in which they were arrested. In addition, law enforcement agents executed searches as part of an ongoing investigation.
“The indictment unsealed today alleges that from April 2009 to December 2011, the defendants operated an extensive black market, identity fraud ring,” said Assistant Attorney General Breuer. “The alleged conspiracy stretched across the United States and Puerto Rico, using suppliers, identity brokers and mail and money runners to fill and deliver orders for the personal identifying information and government-issued identity documents of Puerto Rican U.S. citizens. Those willing to buy and sell personal identifying information and documents should take notice of today’s actions. The department and our law enforcement partners will not allow this kind of illegal activity to continue.”
“Today’s arrests are a reflection of ICE Homeland Security Investigations unrelenting determination to identify and dismantle national smuggling rings engaged in document and identity fraud,” said ICE Director John Morton. “The conspiracy alleged to be perpetrated by those charged undermines the integrity of our national immigration system. We will continue working with our federal partners to protect our homeland from criminals who have no regard for our nation’s safety and security.”
According to the indictment, from at least April 2009 to December 2011, conspirators in 15 states and Puerto Rico, a U.S. territory, trafficked the identities of Puerto Rican U.S. citizens, corresponding Social Security cards, Puerto Rico birth certificates and other identification documents to undocumented aliens and others residing in the United States.
The indictment alleges that conspirators located in the Savarona area of Caguas, Puerto Rico, (Savarona suppliers) obtained the Puerto Rican identities and corresponding identity documents. Conspirators in various locations throughout the United States (identity brokers) solicited customers. The identity brokers allegedly sold Social Security cards and corresponding Puerto Rico birth certificates for prices ranging from $700 to $2,500 per set. The indictment alleges that identity brokers ordered the identity documents from Savarona suppliers, on behalf of the customers, by making coded telephone calls, including using terms such as “shirts,” “uniforms” or “clothes,” to refer to identity documents. Specifically, the brokers asked for “skirts” for female customers and “pants” for male customers in various “sizes,” which referred to the ages of the identities sought by the customers.
According to the indictment, the Savarona suppliers generally requested that customers’ initial payments be sent by the identity brokers through a money transfer service to persons whose names were provided by the Savarona suppliers. Savarona suppliers allegedly retrieved the payments from the money transfer service and then sent the identity documents to the brokers using express, priority or regular U.S. mail. The indictment alleges that various conspirators sent or received money and mail parcels. The conspirators frequently confirmed sender names and addresses, money transfer control numbers and trafficked identities via text messaging.
According to the indictment, once the identity brokers received the identity documents, they delivered the documents to the customers and obtained second payments. The brokers generally kept the second payments for themselves as profit. Some identity brokers allegedly assumed a Puerto Rican identity themselves and used that identity in connection with the trafficking operation.
As alleged in the indictment, the customers generally obtained the identity documents to assume the identity of Puerto Rican U.S. citizens and to obtain additional identification documents, such as legitimate state driver’s licenses. Some customers allegedly obtained the documents to commit financial fraud and attempted to obtain a U.S. passport.
“From Main Street to Wall Street, identity fraud exacts a devastating toll on American consumers and businesses. U.S. Postal Inspectors will continue to aggressively investigate criminals who use the mail to defraud postal customers,” said Chief Postal Inspector Cottrell.
“The Diplomatic Security Service is firmly committed to working with our law enforcement partners to investigate and bring to justice those who commit document trafficking and identity fraud,” said Director Bultrowicz of the U.S. State Department’s Diplomatic Security Service. “Fraudulently-obtained documents are frequently used to apply for U.S. passports and visas, two of the most coveted travel documents in the world.”
“IRS Criminal Investigation has made investigating identity theft a top priority,” said Acting Chief Raven of the IRS-CI. “We are committed to working with our law enforcement partners to unravel the money trail of criminal enterprises that defraud government and prey on unwitting victims.”
The indictment alleges that various identity brokers were operating in Rockford, Ill.; Indianapolis; DeKalb, Ill.; Columbus and Seymour, Ind.; Aurora, Ill.; Hartford, Conn.; Clewiston, Fla.; Lilburn and Norcross, Ga.; Salisbury, Md.; Columbus, Ohio; Fairfield, Ohio; Dorchester, Mass.; Lawrence, Mass.; Salem, Mass.; Worcester, Mass.; Grand Rapids, Mich.; Nebraska City, Neb.; Elizabeth, N.J.; Burlington, N.C.; Hickory, N.C.; Hazelton, Pa.; Philadelphia; Houston; and Abingdon, Va.
If convicted, each defendant faces a maximum sentence of 15 years in prison and a $250,000 fine, as well as forfeiture.
The charges announced today are the result of Operation Island Express, an ongoing, nationally-coordinated investigation led by the ICE-HSI Chicago Office and USPIS, DSS and IRS-CI offices in Chicago, in coordination with the ICE-HSI San Juan Office. The Illinois Secretary of State Police; Elgin, Ill., Police Department; Seymour, Ind., Police Department; and Indiana State Police provided substantial assistance. The ICE-HSI Assistant Attaché office in the Dominican Republic, National Drug Intelligence Center - Document and Media Exploitation Branch and International Organized Crime Intelligence and Operations Center (IOC-2) provided invaluable assistance as well as various ICE, USPIS, DSS and IRS CI offices around the country.
The case is being prosecuted by the Criminal Division’s Human Rights and Special Prosecutions Section, with the assistance of the Criminal Division’s Asset Forfeiture and Money Laundering Section, and the support of the U.S. Attorney’s Office for the District of Puerto Rico. The U.S. Attorneys’ Offices in the Northern District of Illinois, Southern District of Indiana and District of Connecticut provided substantial assistance. The U.S. Attorneys’ Offices in the Middle District of Florida, Southern District of Florida, Northern District of Georgia, Western District of Kentucky, District of Maryland, District of Massachusetts, Western District of Michigan, District of Nebraska, District of New Jersey, Western District of North Carolina, Southern District of Ohio, Eastern District of Pennsylvania, Middle District of Pennsylvania, Southern District of Texas, Eastern District of Virginia, Southern District of Illinois, Western District of Texas, Middle District of Louisiana and Western District of Virginia also provided invaluable support.
A website will be established to provide information about the case to potential victims and the public. Anyone who believes their identity may have been compromised in relation to this investigation may contact the ICE toll-free hotline at 1-866-DHS-2ICE (1-866-347-2423) and its online tip form at www.ice.gov/tipline. Anyone who may have information about particular crimes in this case should also report it to the ICE tip line or website.
Anyone who believes that they have been a victim of identity theft, or wants information about preventing identity theft, may obtain helpful information and complaint forms on various government websites including the Federal Trade Commission ID Theft Website, www.ftc.gov/idtheft. Additional resources regarding identity theft can be found at http://www.ojp.usdoj.gov/ovc/pubs/ID_theft/idtheft.html; http://www.ssa.gov/pubs/10064.html ; http://www.fbi.gov/about-us/investigate/cyber/identity_theft; and http://www.irs.gov/privacy/article/0,,id=186436,00.html.
An indictment is merely a formal accusation. Defendants are presumed innocent unless proven guilty in a court of law.
Tuesday 10 January 2012
Massachusetts Man Sentenced to 78 Months in Prison for Receiving and Possessing Child PornographyRead the Press Release
WASHINGTON – A Springfield, Mass., man was sentenced today to 78 months in prison and seven years of supervised release for receiving and possessing child pornography, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.
Robert Rosenbeck, 49, was sentenced by U.S. District Judge Denise J. Casper in Boston. On Oct. 6, 2011, Rosenbeck pleaded guilty to one count of receipt of child pornography and two counts of possession of child pornography. He was indicted on those charges on Dec. 10, 2009, by a grand jury in Springfield.According to the indictment, from approximately July 22, 2007, to July 27, 2007, Rosenbeck received computer files containing child pornography from an Internet website. Additionally, Rosenbeck possessed two different computers containing child pornography in 2007.
The case was prosecuted by Trial Attorneys Alecia Riewerts Wolak and Michael W. Grant of the Criminal Division’s Child Exploitation and Obscenity Section. The investigation was conducted by the FBI with assistance provided by the Springfield Police Department.Justice Department Settles Lawsuit Against the Berkeley County, S.C., Sheriff’s Office for Violating Detainees’ First Amendment Religious and Speech RightsRead the Press Release
WASHINGTON– The Justice Department announced today that it has entered into a consent injunction with the Berkeley County, S.C., Sheriff’s Office (BCSO). The injunction resolves the United States’ claims against BCSO raised in Prison Legal News v. DeWitt. The United States intervened into the ongoing lawsuit on April 12, 2011.
The United States alleged that BCSO denied detainees access to books, magazines, newspapers or other expressive materials and denied them the right to practice their religion, in violation of the First Amendment and the Religious Land Use and Institutionalized Persons Act (RLUIPA). The agreement entered today protects the constitutional and federal statutory rights of detainees by ensuring that they have appropriate access to religious materials and reading materials, access that Berkeley County Detention Center (BCDC) had previously denied. The court will retain oversight over the agreement to ensure that this access is upheld.
“The rights to practice one’s faith and to be informed about matters of public interest are among our most cherished freedoms,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Department of Justice is committed to vigorously enforcing the First Amendment and RLUIPA to ensure that freedom of expression and religious liberty remain protected. Not only will this agreement uphold the Constitution, it will also promote the safety, security and good order of BCDC; assist in rehabilitating detainees; and ensure that the people of Berkeley County have confidence in the criminal justice system.”
“The rights guaranteed by the Constitution extend to all people in the United States,” said William N. Nettles, U.S. Attorney for the District of South Carolina. “By protecting those rights – even for the incarcerated – we strengthen those rights for all.”
This civil action was filed by Assistant U.S. Attorney Barbara M. Bowens and Civil Rights Division Special Litigation Section Attorneys Timothy D. Mygatt, Michael J. Songer and Amin Aminfar.
RLUIPA, which protects the religious freedom of persons confined to institutions such as prisons, mental health facilities and state-run nursing homes, was enacted by both houses of Congress unanimously and signed into law on Sep. 22, 2000. The law also addresses religious discrimination in land use in response to concerns that places of worship, particularly those of religious and ethnic minorities, were frequently subjected to discrimination in zoning matters. In the 10 years since its passage, RLUIPA has helped secure the ability of thousands of individuals to practice their faiths freely and without discrimination.
More information on the Civil Rights Division’s efforts to combat religious discrimination may be found at www.justice.gov/crt .
Department of Justice Access to Justice Initiative Issues Report to Assist Foreclosure Mediation ProgramsRead the Press Release
The Access to Justice Initiative today released Foreclosure Mediation: Emerging Research and Evaluation Practices, a report resulting from a March 7, 2011, workshop with dozens of foreclosure mediation program stakeholders and researchers. Foreclosure mediation programs, in which a neutral third-party facilitates negotiations between a lender and homeowner in an attempt to reach an alternative to foreclosure or other mutually beneficial outcome, are increasingly being adopted across the country in response to the nation’s foreclosure crisis.
The report being released today summarizes the workshop proceedings and compiles the most recent foreclosure mediation research and resources.
“The loss of a home to foreclosure can be devastating to a family,” said Senior Counselor for Access to Justice Mark Childress. “The report released today compiles the best available research on foreclosure mediation programs and serves as an important resource for existing programs around the country as well as for jurisdictions attempting to establish foreclosure mediation programs. Well-structured foreclosure mediation programs may offer the millions of families at risk of foreclosure a way to stay in their homes.”
The March 2011 workshop at the Department of Justice and the newly-released report build upon a Nov. 19, 2010 event co-hosted by the Middle Class Task Force and the Access to Justice Initiative at the White House. At the event, Vice President Joe Biden and Attorney General Eric Holder unveiled a series of steps designed to help middle class and low-income families secure their legal rights and announced new resources to help bring stakeholders together, share knowledge and expertise, and highlight the most effective new strategies for foreclosure mediation.
The March 2011 workshop was designed to achieve two goals in support of the development of mediation as a foreclosure intervention: (1) to illuminate best practices for research and evaluation of foreclosure mediation programs and related interventions, and (2) to build and strengthen relationships among program administrators, researchers, advocates and representatives from government agencies and the lending community.
Several key findings emerged from the workshop and are expanded upon in the report:
· In a tight budget climate, foreclosure mediation programs’ survival depends on rigorous research and evaluation to determine which program models and program characteristics produce the best outcomes.
· The creative collaborations represented in the workshop, such as those between programs and academic institutions, foundations, legal aid organizations, think tanks and government partners, can lead to efficient use of resources and quality evaluation.
· In order to conduct the kind of research and evaluation that is needed, there must be consensus regarding which data points and categories of data must be collected.
· The federal government should take an active role, both in helping to develop program and evaluation guidelines and in providing resources for mediation programs and research
The full report, Foreclosure Mediation: Emerging Research and Evaluation Practices, is available for download: http://justice.gov/atj/foreclosure-mediation.pdf
The Access to Justice Initiative, headed by Senior Counselor Mark Childress, was established in March 2010 to address the access to justice crisis in the criminal and civil justice system. The mission of the Access to Initiative is to help the justice system efficiently deliver outcomes that are fair and accessible to all, irrespective of wealth and status. The Access to Justice staff works within the Department of Justice, across federal agencies, and with state, local and tribal justice system stakeholders to increase access to counsel and legal assistance and to improve the justice delivery systems that serve people who are unable to afford lawyers.
British Citizen Pleads Guilty to Child Exploitation ChargeRead the Press Release
WASHINGTON – A British citizen pleaded guilty today in the District of Hawaii to one count of producing child pornography, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney for the District of Hawaii Florence T. Nakakuni.
Simon Jasper McCarty, 39, pleaded guilty before U.S. District Judge J. Michael Seabright. McCarty admitted that between 2005 and 2007, he molested three different prepubescent boys outside of the United States and produced videos of the molestation.
McCarty was apprehended on Aug. 5, 2008, when he attempted to fly from Hawaii to Oahu with computer media that contained child pornography. A forensics examination of the media revealed approximately 400 still images and nearly 200 videos of child pornography. Approximately 60 of the videos featured the three minors who were molested by McCarty. McCarty brought the computer media with him when he flew from the United Kingdom to Oahu on July 28, 2008.
McCarty is scheduled to be sentenced on June 12, 2012. At sentencing, McCarty will face a minimum mandatory sentence of 15 years and a maximum sentence of 30 years in prison, a fine of up to $250,000, up to a lifetime term of supervised release and an order of restitution.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section (CEOS) in the Justice Department’s Criminal Division, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case was prosecuted by Assistant U.S. Attorney Amy Olson of the District of Hawaii and Assistant Deputy Chief Alexandra Gelber and Trial Attorney Mi Yung Park of CEOS. The case was investigated by the Honolulu Office of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Hawaii County Police Department, Hawaii Department of Transportation, the Transportation and Security Administration and CEOS’s High Technology Investigative Unit.
Monday 9 January 2012
Triad Mining Agrees to Resolve Clean Water Act Violations and Restore Affected Waterways in IndianaRead the Press Release
WASHINGTON – Triad Mining Inc., the owner and operator of 31 surface mines in Appalachia and Indiana, has agreed to pay a penalty and to restore affected waterways for failing to obtain the required Clean Water Act (CWA) permit for stream impacts caused by its surface mining operation in Indiana, announced the Department of Justice and the U.S. Environmental Protection Agency (EPA). Since 2002, Triad's mining operation has resulted in the unpermitted excavation and filling of more than 53,000 feet of streams that flow into the White River.
“With this settlement, Triad will achieve compliance with the nation’s Clean Water Act and be held accountable for its unpermitted discharges into streams of the White River watershed,” said Ignacia S. Moreno, Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice. “Triad must also undertake restoration efforts and mitigate impacts from its mining activities by enhancing stream beds and creating buffer areas that will benefit aquatic life and recreational resources for the people of Indiana.”
“Protecting America’s waters is one of EPA’s top priorities,” said Cynthia Giles, Assistant Administrator for EPA’s Office of Enforcement and Compliance Assurance. “Today’s settlement will ensure that waterways impacted by unpermitted mining operations are restored and can again benefit the state of Indiana and the surrounding communities.”
Triad, a subsidiary of James River Coal Company, obtained the required Surface Mining Control and Reclamation Act permits from the state of Indiana for its mining operations, but never obtained the required CWA permit for the site, despite the fact that its surface mining operation involved excavating coal seams located directly below stream beds.
On March 24, 2008, the Army Corps of Engineers issued a cease and desist order requiring Triad to stop its unauthorized stream-filling activities. Triad continued its mining practices until the Army Corps of Engineers sent a second order on June 24, 2009, which Triad complied with. Since the second order was issued, Triad has continued mining, but has avoided additional impacts to streams.
Under the settlement, Triad must restore 34,906 linear feet of streams and enhance 4,330 linear feet of stream bed to address and mitigate impacts to stream beds caused by its mining activities. Triad will also create and maintain 66 acres of forested buffer areas and nine acres of forested wetland to protect the restored streams. Triad will also pay a $810,171 civil penalty.
The proposed settlement, lodged in the U.S. District Court for the Southern District of Indiana, is subject to a 30-day comment period and final court approval.
More information on the settlement: www.epa.gov/compliance/resources/cases/civil/cwa/triadmining.html .
Man Sentenced in Connection with Arson at Planned Parenthood and Vandalism of Mosque in Madera, CaliforniaRead the Press Release
Donny Eugene Mower, 38, of Madera, Calif., was sentenced in federal court today following his October 2011 guilty pleas to one count of arson, one count of damaging religious property and one count of violating the Freedom of Access to Clinic Entrances (FACE) Act, which makes it a federal crime to damage the property of a reproductive health services facility. These charges stem from Mower’s lighting a fire inside a Planned Parenthood clinic and throwing a brick at a mosque in Madera.
Mower was sentenced by Judge Lawrence J. O’Neill to five years in prison, to be followed by three years of supervised release. Mower was also ordered to pay more than $26,000 in restitution.
When Mower pleaded guilty in October 2011, he admitted that in the early morning hours of Sep. 2, 2010, he constructed a Molotov cocktail by stuffing a fuel-soaked cloth into a beer bottle. He then drove to Madera Planned Parenthood Clinic, lit the Molotov cocktail, and threw it through a ground-floor window of the clinic. As a result of the ensuing fire, the clinic sustained more than $26,000 of damage and had to close for two days. Mower also acknowledged that on Aug. 20, 2010, two days after placing a sign in front of Masjid Madera that read “No temple for the god of terrorism at ground zero. ANB,” he threw a brick at the front of the mosque and damaged its facade. On Aug. 24, 2010, Mower left additional signs at the mosque, stating “Wake up America, the enemy is here” and “American Nationalist Brotherhood.” Mower admitted that he threw the brick at Masjid Madera because of the race, color or ethnic characteristics of the individuals associated with the mosque.
“This sentence sends a powerful message that the Justice Department will not tolerate violent interference with the lawful work of reproductive health clinics or attacks on places of worship of all faiths,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Department of Justice remains committed to protecting our communities from such violence and will continue to aggressively prosecute these acts.”
“Those who resort to threats and violence to intimidate others in the free exercise of their rights will attract the full force of federal law enforcement,” said U.S. Attorney Benjamin B. Wagner for the Eastern District of California. “Mr. Mower not only attempted to burn a clinic that lawfully provided reproductive health services, he tried to intimidate and incite hatred against Muslim Americans. As the sentence imposed today indicates, victims of such offenses have an ally not only in the Justice Department, but in federal law.”
This case was investigated by the FBI; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Madera Police Department and the Madera County Sheriff’s Department. The case was prosecuted by Assistant U.S. Attorney Elana Landau for the Eastern District of California and Trial Attorney Chiraag Bains from the Justice Department’s Civil Rights Division.
Los Angeles Woman Sentenced to 60 Months in Prison for Her Role in a $6.2 Million Medicare Fraud SchemeRead the Press Release
WASHINGTON— A Los Angeles woman who pleaded guilty to using fraudulent medical clinics and the stolen identities of physicians to defraud Medicare of more than $6.2 million was sentenced to 60 months in prison today, the Department of Justice, the FBI and the Department of Health and Human Services (HHS) announced.
Carolyn Ann Vasquez, 47, was also ordered to pay $6.2 million in restitution by U.S. District Judge Consuelo B. Marshall of the Central District of California. In addition, Judge Marshall ordered Vasquez to serve three years of supervised release following their prison term.
In March 2011, Vasquez pleaded guilty to conspiracy to commit health care fraud. In her plea agreement, Vasquez admitted that from 2007 to 2008, she conspired with others to use a series of fraudulent Los Angeles-area medical clinics to defraud Medicare. Vasquez admitted that her co-conspirators used the identities and Medicare provider numbers of physicians who both worked and did not work at the clinics to submit false claims to Medicare for reimbursement for services the physicians did not perform and for power wheelchairs, medical equipment and diagnostic tests that the physicians did not order or prescribe. According to court documents, physician assistants recruited to work at the clinics by Vasquez and working at her direction and the direction of others, performed services that were medically unnecessary and prescribed and ordered the wheelchairs, medical equipment and diagnostic tests that were medically unnecessary.
According to court documents, Vasquez obtained access to physicians’ personal and Medicare information, which she stole to further the fraud scheme at the medical clinics. Vasquez admitted that in approximately 2007, a physician contacted her about a job at one of the fraudulent medical clinics, but the physician decided not to accept the job. Nevertheless, Vasquez’s co-conspirators printed prescription pads with the physician’s name and Medicare provider number on them. Vasquez admitted that she instructed a physician assistant working at one of the fraudulent medical clinics to use the prescription pads to write fraudulent prescriptions and medical documentation for diagnostic tests, power wheelchairs and other medical equipment in the physician’s name even though Vasquez knew that the physician did not work at the clinic. Medicare was defrauded of approximately $6,268,899 as a result of her conduct.
Vasquez’s co-defendant, Eduard Aslanyan, who pleaded guilty in April 2011 to conspiracy charges related to this case, is scheduled for sentencing on Feb. 6, 2012. A second co-defendant, David Garrison, a physician assistant who worked at the fraudulent medical clinics with Vasquez and Aslanyan, is scheduled for trial on Jan. 24, 2012.
Today’s sentence was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney André Birotte Jr. for the Central District of California; Tony Sidley, Assistant Chief of the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse; Special Agent in Charge Glenn R. Ferry of the Los Angeles Region for the HHS Office of the Inspector General (HHS-OIG); and Assistant Director in Charge Steven Martinez of the FBI’s Los Angeles Field Office.
The case is being prosecuted by Trial Attorney Jonathan T. Baum of the Criminal Division’s Fraud Section. Former Special Trial Attorney Joseph Hudzik participated in the prosecution. The case is being investigated by the FBI.
Since their inception in March 2007, Strike Force operations in nine locations have charged more than 1,160 defendants who collectively have falsely billed the Medicare program for more than $2.9 billion. In addition, HHS 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 .
Los Angeles Church Pastor Sentenced to 180 Months in Prison for<br /> $14.2 Million Medicare Fraud SchemeRead the Press Release
The pastor of a now defunct Los Angeles church who owned and operated several fraudulent durable medical equipment (DME) supply companies was sentenced today to 180 months in prison for his role in a $14.2 million Medicare fraud scheme, the Department of Justice, the FBI and the Department of Health and Human Services (HHS) announced.
Christopher Iruke, 61, was also ordered to pay $6.7 million in restitution, jointly and severally with his co-conspirators, by U.S. District Judge Terry J. Hatter of the Central District of California. In addition, Judge Hatter ordered Iruke to serve three years of supervised release following his prison term.
In August 2011, a jury found Iruke and his wife, Connie Ikpoh, 49, and one of their employees, Aura Marroquin, guilty of conspiracy and health care fraud offenses following a two-week trial in Los Angeles.
According to evidence introduced at trial, Iruke and Ikpoh were pastors at Arms of Grace Christian Center, a church that operated from 5700 Crenshaw Boulevard in Los Angeles, where Iruke and Ikpoh also operated Pascon Medical Supply, a fraudulent DME supply company. Iruke and Ikpoh hired several of their parishioners at Arms of Grace to assist them in running Pascon and another fraudulent DME supply company, Horizon Medical Equipment and Supply Inc. Horizon was owned by Ikpoh, who also worked as a nurse at two Los Angeles-area hospitals.
According to evidence presented at trial, Iruke, Ikpoh, Marroquin and their co-conspirators used fraudulent prescriptions and documents that Iruke purchased from a number of illicit sources to bill Medicare for expensive, high-end power wheelchairs and orthotics that were medically unnecessary or never provided. These power wheelchairs cost approximately $900 per wheelchair wholesale, but were billed to Medicare at a rate of approximately $6,000 per wheelchair.
Evidence introduced at trial established that when it appeared to Iruke that he would have to close Pascon due to an audit by Medicare, Iruke convinced his sister, Jummal Joy Ibrahim, and a member of Arms of Grace to allow him to use their names and identities to open two new fraudulent DME supply companies. These companies, Contempo Medical Equipment Inc. and Ladera Medical Equipment Inc., also operated from Los Angeles. After Pascon and Horizon closed, Iruke and his co-conspirators continued to operate the fraud scheme from Contempo and Ladera.
Witnesses who sold fraudulent prescriptions and documents to Iruke testified that they and others paid cash kickbacks to street-level marketers to offer Medicare beneficiaries free power wheelchairs and other DME in exchange for the beneficiaries’ Medicare card numbers and personal information. These witnesses testified that they and their associates used this information to create fraudulent prescriptions and medical documents which they sold to Iruke and the operators of other fraudulent DME supply companies for $1,100 to $1,500 per prescription.
Trial testimony established that Iruke took extensive efforts to conceal the fraud scheme and his involvement with the companies. One witness who worked at the companies testified that Iruke directed her and Marroquin to lie to state and Medicare inspectors about his involvement with Contempo and Ladera when the inspectors visited the companies.
Witness testimony established that shortly after agents visited Ladera, Iruke directed Marroquin and Darawn Vasquez, a member of Arms of Grace who worked at the supply companies, not to talk to law enforcement. Iruke provided Marroquin and Vasquez with cellular telephones, and directed them to use the phones in order to prevent law enforcement from intercepting their conversations. Iruke and Vasquez then met at Arms of Grace, and shredded evidence of the fraud scheme.
Witness testimony and evidence introduced at trial also established that within a few weeks of the agents visiting Ladera, Iruke closed Contempo and Ladera, which prompted agents to serve Iruke and his attorneys with subpoenas for the files of the companies. Instead of producing the files, Iruke directed that the files be brought to an auditorium used by Arms of Grace, where Iruke, Ikpoh, Marroquin and others altered and destroyed documents within the files to remove evidence of the fraud scheme. Law enforcement agents found Marroquin with these files when they arrested her.
Evidence introduced at trial showed that as a result of this fraud scheme, Iruke, Ikpoh, Marroquin and their co-conspirators submitted more than $14.2 million in fraudulent claims to Medicare, and received approximately $6.7 million in reimbursement payments from Medicare. The evidence at trial showed that Iruke and Ikpoh diverted most of this money from the bank accounts of the supply companies to pay for the fraudulent prescriptions and documents which Iruke purchased to further the scheme, and to cover the leases on their Mercedes vehicles, home remodeling expenses and other personal expenses.
Ikpoh is scheduled to be sentenced on Feb. 27, 2012. Vasquez and Ibrahim pleaded guilty to conspiracy and false statement charges in February 2011 and March 2011, respectively, and are awaiting sentencing. On Dec. 9, 2011, Judge Hatter sentenced Marroquin to time served and three years of supervised release.
Today’s sentence was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney André Birotte Jr. for the Central District of California; Tony Sidley, Assistant Chief of the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse; Special Agent in Charge Glenn R. Ferry of the Los Angeles Region for the HHS Office of the Inspector General (HHS-OIG); and Assistant Director in Charge Steven Martinez of the FBI’s Los Angeles Field Office.
The case was prosecuted by Trial Attorney Jonathan Baum of the Criminal Division’s Fraud Section and Assistant U.S. Attorney David Kirman of the Central District of California. The case was investigated by HHS-OIG with assistance from the California Department of Justice. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California.
Since their inception in March 2007, Strike Force operations in nine locations have charged more than 1,160 defendants who collectively have falsely billed the Medicare program for more than $2.9 billion. In addition, HHS 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 .
CDR Financial Products Executive and Former Executive Plead Guilty in New York to Bid-Rigging and Fraud Conspiracies Related to Municipal Bond InvestmentsRead the Press Release
An executive and a former executive of Rubin/Chambers, Dunhill Insurance Services, also known as CDR Financial Products, pleaded guilty today in the Southern District of New York for their participation in bid-rigging and fraud conspiracies related to contracts for the investment of municipal bond proceeds and other related municipal finance contracts, the Department of Justice announced.
Zevi Wolmark, also known as Stewart Wolmark, the former chief financial officer and managing director of CDR, and Evan Andrew Zarefsky, a CDR vice president, pleaded guilty before U.S. District Judge Victor Marrero. CDR is a Beverly Hills, Calif.-based financial products and services firm. Wolmark and Zarefsky, together with CDR and its founder and president, David Rubin, were indicted on Oct. 29, 2009. Rubin and CDR pleaded guilty on Dec. 30, 2011.
Wolmark and Zarefsky each pleaded guilty to participating in separate bid-rigging and fraud conspiracies with various financial institutions and insurance companies and their representatives. These institutions and companies, or “providers,” offered a type of contract, known as an investment agreement, to state, county and local governments and agencies throughout the United States. The public entities were seeking to invest money from a variety of sources, primarily the proceeds of municipal bonds that they had issued to raise money for, among other things, public projects. Wolmark and Zarefsky also pleaded guilty to one count of wire fraud in connection with those schemes.
“Through corruption and bid rigging, Zevi Wolmark and Evan Zarefsky reaped profits for their company by defrauding municipalities and denying them the competition they deserved,” said Sharis A. Pozen, Acting Assistant Attorney General in charge of the Justice Department’s Antitrust Division. “Our investigation into the municipal bond derivatives industry has now led to guilty pleas by 12 financial executives and charges against six others.”
According to court documents, CDR was hired by public entities that issue municipal bonds to act as their broker and conduct what was supposed to be a competitive bidding process for contracts for the investment of municipal bond proceeds. Competitive bidding for those contracts is the subject of regulations issued by the U.S. Department of the Treasury and is related to the tax-exempt status of the bonds.
During his plea, Wolmark admitted that, from 1998 until 2006, he and other co-conspirators favored certain providers when determining which provider would win contracts for investment agreements. Wolmark also admitted that he ensured that certain providers won by soliciting intentionally losing bids from other providers and manipulated bidding in return for unearned or inflated fees. Additionally, Wolmark admitted that he signed certifications that contained false statements regarding whether the bidding process for certain investment agreements complied with relevant Treasury regulations.
Zarefsky admitted that he supplied information to providers to help them win bids, allowed providers to lower their bids and solicited intentionally losing bids from some providers so that other providers could win certain contracts.
“Municipal bonds are issued to fund public works or otherwise serve a public purpose,” said FBI Assistant Director-in-Charge Janice K. Fedarcyk of the New York Field Office. “Bid rigging in the investment of bond proceeds effectively reduces the potential yield on those proceeds, meaning the actions of these defendants had an adverse impact on the public. This wasn’t just self-interest. It was self-interest that ran directly counter to the public interest.”
“Today’s guilty pleas by Zevi Wolmark and Evan Zarefsky represent a milestone in the government’s investigation,” said Special Agent in Charge Charles R. Pine of the Internal Revenue Service-Criminal Investigation (IRS-CI) New York Field Office . “CDR and the firm’s employees have effectively been removed from the municipal bond market and will no longer be able to manipulate and control the bid process for the reinvestment of tax-exempt municipal bond proceeds. This scheme to conceal kickbacks through complex derivative transactions has come to an end. IRS Criminal Investigation will continue to investigate those who violate the law for financial gain at the expense of taxpayers.”
The bid–rigging conspiracy with which Wolmark and Zarefsky are charged carries a maximum penalty of 10 years in prison and a $1 million criminal fine. The fraud conspiracy with which they are charged carries a maximum penalty of five years in prison and a $250,000 criminal fine. The wire fraud charge with which each defendant is charged carries a maximum penalty of 20 years in prison and a $250,000 criminal fine. The maximum fines for each of these offenses 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.
Including today’s guilty pleas, 12 individuals have pleaded guilty in an ongoing federal investigation into the municipal bonds industry, which is being conducted by the Antitrust Division’s New York Field Office, the FBI and IRS-CI.
In addition, Dominick Carollo and Peter S. Grimm, formerly of GE Funding Capital Market Services, and Steven E. Goldberg, formerly of GE Funding Capital Market Services and FSA, were indicted on July 27, 2010, and are scheduled to begin trial in April 2012. Three former UBS employees, Peter Ghavami, Gary Heinz and Michael Welty, were indicted on Dec. 9, 2010.
Today’s guilty pleas are 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.
Anyone with information concerning bid rigging and related offenses in any financial markets should contact the Antitrust Division’s New York Field Office at 212-335-8000, the FBI at 212-384-5000 or IRS-CI at 212-436-1761, or visit www.justice.gov/atr/contact/newcase.htm.
Broward County, Fla.-Area Halfway House Owner Pleads Guilty to Fraud and Kickback SchemeRead the Press Release
WASHINGTON – The owner and operator of a Broward County, Fla.-area halfway house pleaded guilty today for his role in a Medicare fraud kickback scheme that funneled patients through a fraudulent mental health company, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).
Barry Nash, 69, pleaded guilty before U.S. Magistrate Judge Barry L. Garber in Miami to one count of conspiracy to commit health care fraud. Nash was the owner and operator of Starter House, a halfway house operating in Broward County.
Nash admitted that, in exchange for illegal health care kickbacks, he agreed to refer Medicare beneficiaries who resided at Starter House to American Therapeutic Corporation (ATC) for purported intensive mental health treatment called partial hospitalization program (PHP) services, and to the American Sleep Institute (ASI), a company related to ATC, for purported sleep treatment. Nash knew that ATC and ASI would fraudulently bill Medicare for the PHP treatment and sleep studies that his referrals would purportedly receive.
According to court documents, ATC’s principals paid kickbacks to owners and operators of assisted living facilities and halfway houses and to patient brokers in exchange for delivering ineligible patients to ATC and ASI. In some cases, the patients received a portion of those kickbacks. Throughout the course of the ATC conspiracy, millions of dollars in kickbacks were paid in exchange for Medicare beneficiaries who did not qualify for PHP services. Ultimately, ATC and ASI billed Medicare for more than $200 million in medically unnecessary services.
According to the plea agreement, Nash’s participation in the fraud resulted in more than $959,901 in fraudulent billing to the Medicare program. At sentencing, scheduled for March 8, 2012, Nash faces a maximum of 10 years in prison and a $250,000 fine.
ATC, its management company Medlink Professional Management Group Inc., and various owners, managers, doctors, therapists, patient brokers and marketers of ATC, Medlink and ASI, were charged with various health care fraud, kickback, money laundering and other offenses in two indictments unsealed on Feb. 15, 2011. ATC, Medlink and nine of the individual defendants have pleaded guilty or have been convicted at trial. Other defendants are scheduled for trial April 9, 2012, before U.S. District Judge Patricia A. Seitz.
Today’s guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; John V. Gillies, Special Agent-in-Charge of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher B. Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.
The case is being prosecuted by Trial Attorneys Steven Kim and Jennifer L. Saulino of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force operations in nine locations have charged more than 1,160 defendants that collectively have billed the Medicare program for more than $2.9 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 .
Friday 6 January 2012
Two Former Alabama Sheriff’s Office DeputiesSentenced to Prison for Assaulting Handcuffed Man in CustodyRead the Press Release
WASHINGTON – The Justice Department announced today that Kirby Dollar and Timothy Watford, former deputies with the Russell County, Ala., Sheriff’s Office, were sentenced in federal court in Montgomery, Ala., for their participation in the beating of a handcuffed man who had been taken into official custody. U.S. District Court Judge Mark E. Fuller sentenced Dollar, 37, to 46 months in prison and Watford, 42, to 34 months in prison.
Dollar pleaded guilty on Aug.11, 2011, to willfully depriving the victim of his constitutional right to be free from the use of excessive force. Watford was convicted of the same charge by a federal jury sitting in Opelika, Ala., on Sept, 1, 2011, following a three day trial.
Evidence presented during the court proceedings established that Dollar and Watford, while acting in their capacity as law enforcement officers, punched, kicked and slapped the victim, who was lying on the ground in handcuffs and offering no resistance. The victim suffered multiple lacerations, facial fractures and a ruptured eardrum. Dollar admitted, and witnesses during Watford’s trial confirmed, that the attack was entirely unprovoked.
“These convictions and sentences demonstrate that the use of excessive force cannot be tolerated,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The vast majority of police officers do an outstanding job in protecting both the community and the rights of the accused, even in stressful situations. But when police officers use excessive force to punish arrestees, they will be held accountable.”
“As well intended as some officers may be, police activity must remain within constitutional bounds,” said George L. Beck Jr., U.S. Attorney for the Middle District of Alabama. “Let these two convictions and sentences serve as examples of bad conduct that will be prosecuted by this office. Emotions cannot overcome good judgment. Zealousness cannot overcome good training. And brutality can never be a substitute for effective law enforcement.”
FBI’s Special Agent in Charge Lewis M. Chapman stated, “Today’s sentencing of former Russell County Deputies Kirby Dollar and Tim Watford brings some closure to a breach of trust by law enforcement officers. Law enforcement officers must always act within the bounds of the law under any circumstance and particularly while safeguarding our communities and citizens. The investigation of Civil Rights violations continues to be one of the FBI’s top priorities; and, these sentences reaffirm our commitment to enforcing those standards on ourselves and the law enforcement community.”
The case was investigated by the Mobile Division of the FBI- Montgomery Office and the Alabama Bureau of Investigation, with assistance from the Russell County Sheriff’s Office, the Lee County Alabama Sheriff’s Office and the Columbus, Ga., Police Department. The case was prosecuted by Assistant U.S. Attorneys Nathan D. Stump and Jared H. Morris and Trial Attorney Benjamin J. Hawk of the Justice Department’s Civil Rights Division.
Three Tennessee Men Plead Guilty toLaunching Mortar-Style Fireworks at African-AmericansRead the Press Release
CHATTANOOGA, Tenn. – James Smiley, 27, Colton Partin, 21, and Kyle Montgomery, 21, all of Chattanooga, Tenn., pleaded guilty today in U.S. District Court in Chattanooga for launching fireworks at African-Americans who were congregated outside their apartment building.
In the early morning hours of July 9, 2011, at least four African-American residents of East Lake Courts Public Housing Authority in Chattanooga were on the porch of one of the units. As they conversed, Smiley, Partin and Montgomery drove by several times yelling racial slurs and launched mortar-type fireworks, from a cylinder, directly toward these individuals. The individuals on the porch dove and scattered to avoid the explosions, one of which was captured on video by the Chattanooga Housing Authority. Another explosion shattered a window pane in an apartment of an African-American resident of the East Lake Courts. This individual was asleep inside with her infant child and her boyfriend's adolescent siblings.
Based on a 911 call, the Chattanooga Police Department swiftly apprehended and arrested Smiley, Partin and Montgomery. Fireworks, like the ones fired at the individuals on the porch, were photographed and observed in the bed of the truck. Smiley, Partin and Montgomery admitted their involvement to the officers. They have further admitted that the explosives were fired toward the individuals in order to intimidate them because they were African-American.
"Hate crimes victimize not only individuals but entire communities," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "The Department of Justice is committed to protecting our communities from attempted violence and intimidation motivated by bigotry and prejudice, and ensuring that justice is served."
U.S. Attorney Bill Killian stated, "On behalf of the federal law enforcement community, and in conjunction with state and local law enforcement agencies and the district attorney general, we want the public to know that violations of the civil rights of all persons will not be tolerated. We will aggressively address and prosecute civil rights matters, regardless of the source or nature of the circumstances, or the race, religion, ethnicity, sexual orientation, or any other classification of the victims."
Each faces 10 years in federal prison as well as a $250,000 fine, three years supervised release and a $100 special assessment. Sentencing hearings were set for April 12, 2012, in U.S. District Court, Chattanooga, before the Honorable Curtis L. Collier, Chief U.S. District Court Judge.
Investigative agencies involved in the investigation of this case included the Chattanooga Police Department, Chattanooga Housing Authority Police and the Federal Bureau of Investigation. Assistant U.S. Attorney Chris Poole and Civil Rights Division Trial Attorney Myesha Braden represented the United States.
Three Philippine Nationals Arrested<br /> in International Arms Trafficking CaseRead the Press Release
WASHINGTON – Three Philippine nationals have been arrested on charges of violating the Arms Export Control Act, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney André Birotte Jr. of the Central District of California and Steven M. Martinez, Assistant Director in Charge of the FBI’s Los Angeles Field Office.
Sergio Santiago de Leon Syjuco, aka “Yogi,” 25, of Muntinlupa City, Philippines; Cesar Paolo Inciong Ubaldo, aka “Arvi,” 26, of Paranaque City, Philippines; and Arjyl Revereza, 25, of Manila, Philippines, were charged in criminal complaint unsealed yesterday in the Central District of California with importing defense articles into the United States without a license, in violation of the Arms Export Control Act. Syjuco, Ubaldo and Revereza were arrested upon their entry into the United States on Jan. 5, 2012. They will make their initial appearances today in U.S. District Court in Los Angeles before U.S. Magistrate Judge Alicia G. Rosenberg. According to the complaint, the case is part of an FBI investigation of transnational Asian organized crime groups involved in the illicit trafficking of firearms.
The complaint alleges that on June 7, 2011, Syjuco, Ubaldo and Revereza imported various defense articles – items specifically designed, developed, configured, adapted or modified for military application – into the United States from the Republic of the Philippines, including 12 fully automatic Bushmaster M-4 .223 caliber rifles, a .50 caliber sniper rifle, an M14 7.62mm assault rifle, a single-shot grenade launcher, a rocket propelled grenade (RPG-7) launcher, a mortar launcher, an AK-47 rifle and ballistic vests. None of the defendants had a license to import these items into the United States. Law enforcement officers took possession of the items when they entered the United States.
If convicted, the defendants face a maximum of 20 years in prison.
The case was investigated by the FBI. The Philippines National Bureau of Investigations also provided significant assistance in this matter. The case is being prosecuted by Trial Attorneys Margaret Honrath and Margaret Vierbuchen of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorney Ariel Neuman of the Central District of California.
The details contained in the complaint are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Miami-Area Patient Recruiter Sentenced to 57 Months in Prison for Participating in Medicare Fraud Kickback SchemeRead the Press Release
WASHINGTON – The owner and president of a Miami-area transportation company was sentenced yesterday to 57 months in prison for her role in a Medicare fraud kickback scheme that funneled patients through a fraudulent mental health company, American Therapeutic Corporation (ATC), announced the Department of Justice, FBI and Department of Health and Human Services (HHS).
Isabel Roque was sentenced by U.S. District Judge Michael K. Moore in the Southern District of Florida. In addition to her prison term, Roque was sentenced to three years of supervised release and was ordered to pay $3.8 million in restitution jointly and severally with co-conspirators.
Roque, 55, pleaded guilty in November 2011 to one count of conspiracy to commit health care fraud. Roque was the president of Isa & Yami Inc., which purported to provide patient transportation services in Miami.
According to court documents, Roque agreed to provide Medicare beneficiaries to ATC for partial hospitalization program (PHP) services in exchange for kickbacks. PHP services are used as a form of intensive treatment for patients with severe mental illness. ATC purported to operate PHPs in seven different locations throughout south Florida and Orlando. According to court documents, Roque provided Medicare beneficiaries to four of ATC’s locations, including facilities in Boca Raton, Broward, Homestead and Miami.
Roque admitted that she knew the beneficiaries whom she referred to ATC did not need PHP treatment. Roque also knew that ATC fraudulently billed the Medicare program for the PHP services provided to the beneficiaries she referred. According to court documents, Roque also paid kickbacks to the beneficiaries whom she referred to ATC in exchange for those beneficiaries agreeing to attend ATC.
According to court filings, ATC’s owners and operators paid kickbacks to owners and operators of assisted living facilities and halfway houses and to patient brokers in exchange for delivering ineligible patients to ATC and its related company, the American Sleep Institute (ASI). In some cases, the patients received a portion of those kickbacks. Throughout the course of the ATC conspiracy, millions of dollars in kickbacks were paid in exchange for Medicare beneficiaries who did not qualify for PHP services. The ineligible beneficiaries attended treatment programs that were not legitimate so that ATC and ASI could bill Medicare more than $200 million in medically unnecessary services.
According to the plea agreement, Roque’s participation in the fraud resulted in more than $3.8 million in fraudulent billing to the Medicare program.
ATC, its management company Medlink Professional Management Group Inc., and various owners, managers, doctors, therapists, patient brokers and marketers of ATC, Medlink and ASI, were charged with various health care fraud, kickback, money laundering and other offenses in two indictments unsealed on Feb. 15, 2011. ATC, Medlink and nine of the individual defendants have pleaded guilty or have been convicted at trial. Other defendants are scheduled to begin trial on April 9, 2012, before U.S. District Judge Patricia A. Seitz.
Today’s sentence was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; John V. Gillies, Special Agent-in-Charge of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher B. Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.
The case is being prosecuted by Trial Attorneys Steven Kim and Jennifer L. Saulino of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force operations in nine locations have charged more than 1,160 defendants that collectively have billed the Medicare program for more than $2.9 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 .
Leader of NinjaVideo.Net Website Sentenced <br /> to 22 Months in Prison for Criminal Copyright ConspiracyRead the Press Release
WASHINGTON – A founder of NinjaVideo.net, a website that provided millions of users with the ability to illegally download high-quality copies of copyright-protected movies and television programs, was sentenced today to 22 months in prison, announced U.S. Attorney Neil H. MacBride for the Eastern District of Virginia, Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Immigration and Customs Enforcement (ICE) Director John Morton.
Hana Amal Beshara, 30, of North Brunswick, N.J., was sentenced by U.S. District Judge Anthony J. Trenga in the Eastern District of Virginia. Judge Trenga ordered Beshara to serve two years of supervised release, complete 500 hours of community service, repay $209,826.95 that she personally obtained from her work at NinjaVideo.net and forfeit to the United States several financial accounts and computer equipment involved in the crimes.
On Sept. 9, 2011, Beshara was indicted along with four of the other top administrators of NinjaVideo.net. Beshara pleaded guilty on Sept. 29, 2011, to conspiracy and criminal copyright infringement. Three of Beshara’s co-defendants have pleaded guilty and await sentencing. An arrest warrant remains outstanding for the fourth co-defendant, Zoi Mertzanis of Greece. Another co-founder of NinjaVideo.net who was charged separately has also pleaded guilty.
According to court documents, Beshara was one of the founders of the NinjaVideo.net website, which operated from February 2008 until it was shut down by law enforcement in June 2010. NinjaVideo.net offered visitors the ability to view, without charge, many movies still in theaters as well as some movies that had not yet been released in theaters, and many television programs immediately after they aired. Beshara, who was known as “Queen Phara” on the Internet, served as the public face of NinjaVideo.net. She supervised the uploading and placement of infringing television programs and motion pictures on the website and served as the lead moderator of the website’s forum boards. At one point Beshara managed the conspiracy’s finances, including receiving advertising revenue generated by traffic to NinjaVideo.net. In total, advertising revenue and visitor donations generated more than $505,000 in income for the conspiracy, with Beshara personally receiving nearly $210,000.
The case was prosecuted by Assistant U.S. Attorneys Jay V. Prabhu and Lindsay A. Kelly and Trial Attorney Glenn Alexander of the Computer Crime & Intellectual Property Section in the Justice Department’s Criminal Division.
The investigation was conducted by the HSI-led National Intellectual Property Rights Coordination Center (IPR Center). The IPR Center is one of the U.S. government’s key weapons in the fight against criminal counterfeiting and piracy. As a task force, the IPR Center uses the expertise of its 19 member agencies to share information, develop initiatives, coordinate enforcement actions and conduct investigations related to IP theft. Through this strategic interagency partnership, the IPR Center protects the public’s health and safety, the U.S. economy and the war fighters.
To report IP theft or to learn more about the IPR Center, visit www.IPRCenter.gov.
This case is part of efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force) to stop the theft of intellectual property. Attorney General Eric Holder created the IP Task Force to combat the growing number of domestic and international intellectual property crimes, protect the health and safety of American consumers, and safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation and hard work. The IP Task Force seeks to strengthen intellectual property rights protection through heightened criminal and civil enforcement, greater coordination among federal, state and local law enforcement partners, and increased focus on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders. To learn more about the IP Task Force, go to www.justice.gov/dag/iptaskforce.
Former Army Major Sentenced to Prison in Bribery and Money Laundering Scheme<br /> Related to DOD Contracts in Support of Iraq WarRead the Press Release
WASHINGTON – Eddie Pressley, 41, a former U.S. Army contracting official, was sentenced in Birmingham, Ala., for his participation in a bribery and money laundering scheme related to bribes paid for contracts awarded in support of the Iraq war, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.
U.S. District Judge Virginia Emerson Hopkins sentenced Eddie Pressley late yesterday to 144 months in prison and ordered him to serve three years of supervised release following the prison term. The court said it would also require Pressley to forfeit $21 million as well as real estate and several automobiles.
“Mr. Pressley participated in a wide-ranging scheme to steer U.S. Army contracts to particular providers in exchange for personal, illegal profit,” said Assistant Attorney General Breuer. “Taking in nearly $3 million, he enlisted his wife to help him conceal the nature of his bribes and created phony paperwork to keep the scheme going. This sentence sends the message loud and clear that we will not tolerate corruption of any kind, and are determined to hold corrupt officials accountable.”
“This contracting scheme was driven by greed and is in no way representative of the vast majority of public officials and government contractors who work hard to serve our military,” said James McJunkin, Assistant Director of the FBI’s Washington Field Office. “The FBI will continue to investigate contracting fraud which deprives the U.S. government of taxpayer dollars, regardless of where it occurs.”
“I am pleased to see a perpetrator of criminal activity in Iraq justly sentenced,” said Stuart W. Bowen Jr., Special Inspector General for Iraq Reconstruction (SIGIR). “This individual sought to enrich himself at the expense of U.S. taxpayers. SIGIR’s investigations team will continue to pursue criminals operating in Iraq and bring them to justice.”
“This sentence sends a clear message of deterrence to anyone contemplating such an egregious breach of public trust. It is not a matter of if you will be caught, but a matter of when,” said James K. Podolak, director of Army CID’s Major Procurement Fraud Unit (MPFU). “The outcome of this investigation is yet another testament to the teamwork among the special agents of the U.S. Army Criminal Investigation Command's MPFU and our fellow federal law enforcement agencies.”
“This sentencing represents the seriousness with which the government will pursue corruption among its ranks,” said Special Agent in Charge Robert E. Craig for the Defense Criminal Investigative Service. “The Defense Criminal Investigative Service stands with our service members as they deploy throughout the world and will root out shameless bribery schemes such as this one perpetrated by Mr. Pressley. DCIS continues to work alongside our investigative partners at Army CID, SIGIR, FBI, IRS-CI, and Public Integrity to jointly bring these matters to justice.”
Eddie Pressley, and his wife Eurica Pressley, were found guilty at trial on March 1, 2011, of one count of bribery, one count of conspiracy to commit bribery, eight counts of honest services fraud, one count of money laundering conspiracy and 11 counts of engaging in monetary transactions with criminal proceeds. A sentencing date for Eurica Pressley has not yet been scheduled by the court.
The case against the Pressleys arose from a corruption probe focusing on Camp Arifjan, a U.S. military base in Kuwait. As a result of this investigation, 17 individuals, including the Pressleys, have pleaded guilty or been found guilty at trial for their roles in the scheme.
Evidence presented at trial showed that Eddie Pressley took various actions to benefit certain contractors who paid him bribes, including Terry Hall. Pressley served as a U.S. Army contracting official at Camp Arifjan between 2004 and 2005. From spring 2004 through fall 2007, Hall operated and had an interest in several companies, including Freedom Consulting and Catering Co. and Total Government Allegiance. In February 2005, Eddie Pressley arranged for Hall to obtain a blanket purchase agreement (BPA) to deliver goods and services to the U.S. Department of Defense (DoD) and its components in Kuwait and elsewhere.
A BPA is a type of contract by which the DoD agrees to pay a contractor a specified price for a particular good or service. Based on a BPA, the DoD orders the supplies on an as-needed basis. The contractor is then obligated to deliver the supplies ordered at the price agreed upon in the BPA. The term for such an order by the DoD is a “call.”
According to Hall’s testimony and other evidence presented at trial, Pressley demanded a $50,000 bribe before he would issue bottled water calls to Hall. Hall testified that in April 2005, he and his associates arranged for Pressley to receive the money in a bank account established in the name of a shell company, EGP Business Solutions Inc.
Hall’s testimony and other evidence at trial showed that soon after the $50,000 bribe was paid, Pressley and John Cockerham, another U.S. Army contracting official, increased the bribe demand to $1.6 million, which consisted of $800,000 for Pressley and $800,000 for Cockerham. After Hall and others agreed to pay the money, Pressley and Cockerham took various official acts to benefit Hall, including, among other things, issuing calls for bottled water and fencing, arranging for Hall to receive a fence contract and modifying Hall’s BPA to remove the upper limit of the money Hall could receive from the DoD under the bottled water BPA.
Evidence at trial also showed that Eddie Pressley enlisted the help of his wife to receive the bribes. On March 9, 2005, he sent his wife an email in which he told her, among other things: “You will be getting some paperwork with your maiden name on it”; “I need you to sign it and mail to whatevery (sic) address on it”; “I am doing some consulting”; and “Of course I am not going to turn down any money, but I can’t have anyone paying me in my name because I am in the military so I had them put everything in your maiden name.”
According to evidence presented at trial, Eurica Pressley traveled to Dubai in May 2005 and to the Cayman Islands in June 2005 to open bank accounts to receive the bribe money. She also took control of the U.S.-based account in the name of EGP Business Solutions Inc. A law enforcement agent testified at the trial about various false and misleading statements Eurica Pressley made to him during a voluntary interview at her home, including her denial that she had any foreign bank accounts. In addition, the evidence presented at trial demonstrated that the Pressleys, Hall and others attempted to conceal the true nature of their corrupt scheme by having Eurica Pressley execute bogus “consulting agreements.” They also prepared false invoices that were designed to justify the bribe payments as payment for non-existent “consulting services.”
Bank statements and wire transfer reports demonstrated that, in total, the Pressleys received approximately $2.9 million in bribe payments, approximately $1.6 million of which consisted of payments from other contractors that Hall facilitated for Eddie Pressley. Evidence presented at trial showed that the Pressleys used the money to purchase real estate, expensive automobiles and home decorating services, among other things.
Former U.S. Army Major James Momon also testified at trial that Eddie Pressley and Cockerham recruited him to join the bribe scheme and that he took various official acts to receive bribes from some of the same contractors who paid Pressley and Cockerham, including Hall. Additionally, he testified that Pressley told him that if they got caught they would spend “six years in jail” and that Cockerham and Pressley warned him to be careful.
On Jan. 31, 2008, Cockerham pleaded guilty to participating in a bribery and money laundering scheme at Camp Arifjan. He was sentenced on Dec. 2, 2009, to 210 months in prison and ordered to pay $9.6 million in restitution.
On Feb. 18, 2010, Hall pleaded guilty to bribery conspiracy and money laundering conspiracy and agreed to forfeit $15.7 million to the U.S. government in connection with his payment of more than $3 million in bribes to Cockerham, Eddie Pressley, Momon and Christopher Murray. He is scheduled to be sentenced on Feb. 23, 2012.
On Aug. 13, 2009, Momon pleaded guilty to receiving approximately $1.6 million in bribes and agreed to pay $5.7 million in restitution. Momon’s sentencing has not yet been scheduled. On Jan. 8, 2009, Murray pleaded guilty to charges of bribery and making a false statement. He was sentenced on Dec. 17, 2009, to 57 months in prison and ordered to pay $245,000 in restitution.The case is being prosecuted by Trial Attorneys Peter C. Sprung and Edward J. Loya, Jr. of the Criminal Division’s Public Integrity Section. Assistance was also provided by the Criminal Division’s Office of International Affairs. The cases are being investigated by the Army CID, DCIS, ICE, FBI, IRS-CI, SIGIR and the International Contract Corruption Task Force (ICCTF). The ICCTF is a joint law enforcement agency task force that seeks to detect, investigate and dismantle corruption and contract fraud resulting from U.S. Overseas Contingency Operations worldwide, including in Kuwait, Afghanistan and Iraq.
Federal Court Bars Missouri Man from Preparing Federal Tax ReturnsRead the Press Release
WASHINGTON – A federal court in St. Louis has permanently barred Richard Gray Sr. from preparing federal tax returns for others, the Justice Department announced today. The civil injunction order, to which Gray consented, was signed by Judge Rodney Sippel of the U.S. District Court for the Eastern District of Missouri.
According to the government complaint, Gray, who works periodically at a Chrysler plant in Kokomo, Ind., and resides the remainder of the year in St. Louis, prepared over 130 tax returns in 2009. His customers allegedly included family, friends, neighbors and co-workers. The complaint states that Gray listed fictitious businesses, fake deductions and bogus dependents on his customers’ returns in order to understate their tax liabilities or claim refunds to which they were not entitled.
The suit alleges that Gray has no formal training in tax law or return preparation. The complaint also alleges that Gray fails to report the income he receives from preparing returns on his own income tax returns.
Over 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:
United States v. Richard Gray, Sr.
Complaint
Stipulated Final Judgment of Permanent Injunction Against Richard Gray, Sr.
(PDF document)Portable Document Format (PDF) files may be viewed with a free copy of Adobe Acrobat Reader
Accessibility InformationDepartment of Justice and Other Administration Officials to Hold Press Conference Call on Revisions to the Uniform Crime Report’s Definition of RapeRead the Press Release
Department of Justice and other administration officials will hold a press conference call on revisions to the Uniform Crime Reporting (UCR) definition of rape TODAY, FRIDAY, JAN. 6, 2012, at 10:30 a.m. EST.
WHO: Senior Advisor to the President Valerie Jarrett
White House Advisor on Violence Against Women Lynn Rosenthal
Department of Justice Director of the Office on Violence Against
Women Susan B. Carbon
FBI Assistant Director of the Criminal Justice Information Services
Division David Cuthbertson
WHAT: Press conference call
WHEN: TODAY, FRIDAY, JAN. 6, 2012
10:30 a.m. EST
Reporters who wish to participate in the conference call should contact [email protected] or call 202-514-2007 for call-in information.
Austin, Texas, Man Pleads Guilty to Bankruptcy Fraud and Identity Theft<br /> in Connection with Nationwide Foreclosure-rescue SchemeRead the Press Release
WASHINGTON – An Austin, Texas, man pleaded guilty today in the Western District of Texas for his role in operating a foreclosure-rescue scam in Southern California and elsewhere that charged distressed homeowners fees in exchange for fraudulently postponing foreclosure sales.
The guilty plea was 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, U.S. Attorney Robert Pitman of the Western District of Texas, Assistant Director in Charge Steven Martinez of the FBI’s Los Angeles Field Office and Christy Romero, Deputy Special Inspector General for the Troubled Asset Relief Program (SIGTARP).
Frederic Alan Gladle, 53, was charged on Dec. 9, 2011, in U.S. District Court in Los Angeles with one count of bankruptcy fraud and one count of aggravated identity theft.
Today, Gladle admitted that beginning in October 2007 and continuing until October 2011, he operated a foreclosure-rescue fraud scheme that netted him more than $1.6 million in fees from distressed homeowners. According to court documents, Gladle used five aliases to avoid detection, including stealing the identity of at least one person and setting up a mobile phone account in that victim’s name.
Gladle admitted that he recruited homeowners whose properties were in danger of imminent foreclosure and falsely promised to delay the foreclosures for up to six months, in exchange for a fee of approximately $750 per month. Gladle, directly or through salespersons, directed homeowners to sign deeds granting fractional interest in their properties to debtors in bankruptcy proceedings whose names Gladle found by searching bankruptcy records. The debtors were unaware that their names and bankruptcy cases were being used by Gladle in his scheme. Gladle then sent the unsuspecting debtors’ bankruptcy petitions, and the deeds that transferred fractional interests to the debtors, to the homeowners’ lenders to stop foreclosure proceedings.
Because bankruptcy filings give rise to automatic stays that protect debtors’ properties, the receipt of the bankruptcy petitions and deeds in the debtors’ names forced lenders to cancel foreclosure sales. The lenders, which included banks who received government funds under the Troubled Asset Relief Program (TARP), could not move forward to collect money that was owed to them until getting permission from the bankruptcy courts, thereby repeatedly delaying the lenders’ recovery of their money. When homeowners wanted to void the deeds to the unsuspecting debtors, Gladle would forge the debtors’ signatures on papers voiding the deeds.
The crime of bankruptcy fraud carries a statutory maximum sentence of five years in federal prison. The aggravated identity theft charge carries a mandatory sentence of two years.
This case is being prosecuted by Trial Attorney Paul Rosen of the Fraud Section in the Justice Department’s Criminal Division, Assistant U.S. Attorney Evan Davis for the Central District of California, with substantial assistance provided by Assistant U.S. Attorneys Chris Peele and Mark Lane of the Western District of Texas. The investigation was conducted by the FBI and SIGTARP, which received substantial assistance from the U.S. Trustee’s Office.
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 .
Attorney General Eric Holder Announces Revisions to the Uniform Crime Report’s Definition of RapeRead the Press Release
Attorney General Eric Holder today announced revisions to the Uniform Crime Report’s (UCR) definition of rape, which will lead to a more comprehensive statistical reporting of rape nationwide. The new definition is more inclusive, better reflects state criminal codes and focuses on the various forms of sexual penetration understood to be rape. The new definition of rape is: “The penetration, no matter how slight, of the vagina or anus with any body part or object, or oral penetration by a sex organ of another person, without the consent of the victim.” The definition is used by the FBI to collect information from local law enforcement agencies about reported rapes.
“Rape is a devastating crime and we can’t solve it unless we know the full extent of it,” said Vice President Biden, a leader in the effort to end violence against women for over 20 years and author of the landmark Violence Against Women Act. “This long-awaited change to the definition of rape is a victory for women and men across the country whose suffering has gone unaccounted for over 80 years.”
“These long overdue updates to the definition of rape will help ensure justice for those whose lives have been devastated by sexual violence and reflect the Department of Justice’s commitment to standing with rape victims,” Attorney General Holder said. “This new, more inclusive definition will provide us with a more accurate understanding of the scope and volume of these crimes.”
“The FBI’s Criminal Justice Information Services (CJIS) Advisory Policy Board recently recommended the adoption of a revised definition of rape within the Summary Reporting System of the Uniform Crime Reporting Program,” said David Cuthbertson, FBI Assistant Director, CJIS Division. “This definitional change was recently approved by FBI Director Robert S. Mueller. This change will give law enforcement the ability to report more complete rape offense data, as the new definition reflects the vast majority of state rape statutes. As we implement this change, the FBI is confident that the number of victims of this heinous crime will be more accurately reflected in national crime statistics.”
The revised definition includes any gender of victim or perpetrator, and includes instances in which the victim is incapable of giving consent because of temporary or permanent mental or physical incapacity, including due to the influence of drugs or alcohol or because of age. The ability of the victim to give consent must be determined in accordance with state statute. Physical resistance from the victim is not required to demonstrate lack of consent. The new definition does not change federal or state criminal codes or impact charging and prosecution on the local level.
“The revised definition of rape sends an important message to the broad range of rape victims that they are supported and to perpetrators that they will be held accountable,” said Justice Department Director of the Office on Violence Against Women Susan B. Carbon. “We are grateful for the dedicated work of all those involved in making and implementing the changes that reflect more accurately the devastating crime of rape.”
T he longstanding, narrow definition of forcible rape, first established in 1927, is “the carnal knowledge of a female, forcibly and against her will.” It thus included only forcible male penile penetration of a female vagina and excluded oral and anal penetration; rape of males; penetration of the vagina and anus with an object or body part other than the penis; rape of females by females; and, non-forcible rape.
Police departments submit data on reported crimes and arrests to the UCR. The UCR data are reported nationally and used to measure and understand crime trends. In addition, the UCR program will also collect data based on the historical definition of rape, enabling law enforcement to track consistent trend data until the statistical differences between the old and new definitions are more fully understood.
The revised definition of rape is within FBI’s UCR Summary Reporting System Program. The new definition is supported by leading law enforcement agencies and advocates and reflects the work of the FBI’s CJIS Advisory Policy Board.
Click here to read a blog post from Director Carbon on the importance of the new definition of rape to our nation’s law enforcement, and for survivors of rape and their advocates. Click here to listen to the FBI’s podcast .
Arizona Man Sentenced to More Than 5 Years in Prison<br /> in Money Laundering and Tax SchemeRead the Press Release
Wayne A. Mounts, a resident of Mesa, Ariz., was sentenced yesterday to 63 months in prison for his role in conspiracies to commit money laundering and to defraud the Internal Revenue Service (IRS), announced the Justice Department and the IRS today. On July 25, 2011, a federal jury in Phoenix convicted Mounts and his co-defendant, Gino Carlucci, of both conspiracies after an eight-day trial.
According to the evidence presented at trial, Mounts and Carlucci, stole large sums of money from Joseph Flickinger and Flickinger’s clients and associates. Flickinger was a tax return preparer who had himself been sentenced in 2007 to 70 months in prison following a guilty plea to tax fraud conspiracy, as well as mail and wire fraud charges. Flickinger’s mail and wire fraud convictions related to a Ponzi-style investment scheme through which he had defrauded his clients.
After defrauding Flickinger of the money he obtained by fraud, Mounts and Carlucci used the money for their own personal benefit. Mounts withdrew more than $250,000 in cash from a bank account over a two-month period. He withdrew the money in amounts just under $10,000 to avoid having the bank report his withdrawals to authorities. Mounts and Carlucci spent an additional $150,000 of the funds to buy a 43-foot luxury boat which Carlucci concealed from the government for over two years.
Judge Kathryn H. Vratil, Chief Judge of the District of Kansas, sitting in Phoenix by special designation, ordered Mounts to pay $686,841 in restitution to the victims in Flickinger’s case and $80,787.80 in restitution to the IRS. Judge Vratil further entered a forfeiture order against Mounts for a money judgment in the amount of $722,841.00.
Sentencing for Gino Carlucci is set for Feb. 28, 2012, before Judge Vratil in Phoenix. Carlucci faces a maximum sentence of 20 years in prison for conspiracy to commit money laundering; five years in prison for conspiracy to defraud the United States; and three years in prison for filing a false tax return.
Additional information about the Justice Department’s Tax Division and its enforcement efforts is available at www.usdoj.gov/tax/.
John A. DiCicco, Principal Deputy Assistant Attorney General of the Justice Department’s Tax Division, commended the special agents from IRS-Criminal Investigation who investigated the case as well as Tax Division attorneys Richard Rolwing, Hayden Brockett and Monica Edelstein who prosecuted the case. Principal Deputy Assistant Attorney General DiCicco also thanked the U.S. Attorney’s Office for the District of Arizona for their assistance in this matter.
Alabama Woman Pleads Guilty to Identity Theft and Tax ChargesRead the Press Release
The Justice Department and the Internal Revenue Service (IRS) announced that Loretta Fergerson pleaded guilty today before Magistrate Judge Charles S. Coody in Montgomery, Ala., to conspiring to defraud the United States government, wire fraud and aggravated identity theft. Fergerson and a co-defendant were charged by a grand jury in a 22-count indictment that was unsealed on March 30, 2011.
According to the plea agreement, Fergerson owned and operated a tax return preparation business called Fast Tax Cash in Montgomery. From 2005 through 2008, Fergerson and her employees filed tax returns using stolen identities in order to claim fraudulent tax refunds. Additionally, Fergerson admitted that she and her employees filed tax returns for Fast Tax Cash clients that contained false information on the tax return in order to obtain higher refunds for customers to which they were not entitled. Fergerson further admitted that she created false driver’s licenses and false Social Security cards to be placed in customer files for returns that were prepared using stolen identities.
A sentencing date has not yet been set. Fergerson faces a maximum potential sentence of 32 years in prison and fines of up to $750,000.
The case was investigated by the IRS-Criminal Investigation and is being prosecuted by trial attorneys Charles M. Edgar, Jr. and Michelle M. Petersen of the Justice Department's Tax Division.
Additional information about the Tax Division and its enforcement efforts may be found at http://www.usdoj.gov/tax.
Alabama Tax Preparers Sentenced to Prison<br /> for Preparing False Tax ReturnsRead the Press Release
Judge Mark Fuller of the U.S. District Court for the Middle District of Alabama sentenced Lutoyua N. Thompson and Melinda M. Lambert to prison today for their involvement in a fraudulent tax return preparation scheme, the Justice Department and Internal Revenue Service (IRS) announced. Thompson was sentenced to 18 months in prison. Lambert was sentenced to six months in prison and six months of home confinement. Both had previously pleaded guilty to aiding and assisting the preparation of a false tax return.
According to the court documents, both Thompson and Lambert were employed by James E. Moss as tax return preparers at a tax return preparation business known as Flash Tax, located in Montgomery, Ala. Thompson was employed at Flash Tax from December 2003 through June 2005 and prepared approximately 600 tax returns. Lambert was employed at Flash Tax from December 2004 through January 2007 and prepared approximately 900 tax returns. The majority of the returns prepared by Lambert and Thompson contained false information designed to illegally obtain higher refunds to which clients were not entitled. Lambert and Thompson admitted that Moss trained them to prepare false tax returns in order to obtain higher tax refunds for Flash Tax customers by inflating or deflating specific numbers and/or by adding totally fictitious numbers to the returns.
On Nov. 2, 2011, Moss was convicted by an Alabama jury of conspiring to defraud the United States and of aiding and assisting the preparation of false tax returns. His sentencing is currently set for March 13, 2012.
John A. DiCicco, Principal Deputy Assistant Attorney General for the Justice Department’s Tax Division commended the IRS special agents who investigated this case and Tax Division trial attorneys Charles M. Edgar, Jr., Thomas J. Krepp, and Michelle M. Petersen who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts is available at www.usdoj.gov/tax.
Thursday 5 January 2012
Pakistani Citizen Sentenced to 50 Months in Prison for Conspiracy to Provide Material Support to the Pakistani TalibanRead the Press Release
WASHINGTON – A Pakistani citizen was sentenced today in the District of Columbia to 50 months in prison for conspiracy to provide material support to the Tehrik-e Taliban Pakistan (TTP), often referred to as the Pakistani Taliban, a designated foreign terrorist organization. Two co-defendants were sentenced for the same charge in December 2011 to 40 and 36 months in prison.
The sentences were announced by Assistant Attorney General for National Security Lisa Monaco; Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney Ronald C. Machen Jr. for the District of Columbia; John Morton, Director of U.S. Immigration and Customs Enforcement (ICE); and John V. Gillies, Special Agent in Charge of the FBI Miami Division.
Irfan Ul Haq, 37, was sentenced today by U.S. District Judge John D. Bates. On Dec. 21, 2011, Judge Bates sentenced Qasim Ali, 32, to 40 months in prison, and Zahid Yousaf, 43, to 36 months in prison. On Sept. 12, 2011, each defendant pleaded guilty to one count of conspiracy to provide material support to a designated foreign terrorist organization. As part of their plea agreements, the defendants agreed to a stipulated order of removal to Pakistan upon the completion of their criminal sentences.
“This case underscores our continuing commitment to dismantle networks that facilitate terrorist travel,” said Assistant Attorney General Monaco. “I thank the many agents, analysts and prosecutors who were responsible for this successful prosecution.”
“Mr. Haq conspired with others to smuggle into the United States an individual who was believed to be a member of a foreign terrorist organization,” said Assistant Attorney General Breuer. “Such conduct presents a serious threat to our national security, and we will continue to work closely with our domestic and international law enforcement partners to prevent human smugglers from operating at home or abroad, and to punish them for their crimes.”
“Today’s sentence successfully brings to a close our prosecution of three criminals who aimed to use their human smuggling network to help a person who they believed to be a terrorist infiltrate our homeland,” said U.S. Attorney Machen. “By convicting three Pakistani nationals who were operating out of Ecuador, we have demonstrated our ability to dismantle human smuggling operations throughout the world when they threaten our national security.”
“ICE Homeland Security Investigations agents will continue to use every available resource to protect the American public from terrorist organizations and individuals who support them,” said ICE Director Morton. “Today’s sentence demonstrates our international resolve to ensuring that our nation is safer and more secure. I applaud the outstanding work conducted by our HSI attaché office in Ecuador who led this extensive investigation. I would also like to commend our HSI office in Atlanta, along with our law enforcement partners in the United States and Ecuador, who assisted us in this case.”
“Today’s sentence sends a clear message: Individuals such as Ul Haq, who operate outside the law to support terror represent a threat to our safety. Ul Haq and his co-conspirators sought to smuggle men into the U.S. and did not care if they came here to ‘blow up’ something as long as they got paid. Ul Haq in turn provided material support to the TTP. Such would-be supporters of terror will be dealt with severely under our system of laws. I commend the FBI and everyone involved in the prosecution of this case for bringing him to justice,” said FBI Special Agent in Charge Gillies.
Ul Haq, Ali and Yousaf were arrested in Miami on March 13, 2011, on an indictment filed in the District of Columbia charging them with one count of conspiracy to commit alien smuggling. Based on the defendants’ guilty pleas to terrorism conspiracy charges, the government dismissed at the sentencing hearing today the charges of conspiracy to commit alien smuggling against the defendants.
Ul Haq, Ali and Yousaf admitted that between Jan. 3, 2011, and March 10, 2011, they conspired to provide material support to the TTP in the form of false documentation and identification, knowing that the TTP engages in terrorist activity and terrorism. According to court documents, Ul Haq, Ali and Yousaf conducted a human smuggling operation in Quito, Ecuador, that attempted to smuggle an individual they believed to be a member of the TTP from Pakistan into the United States. The TTP was designated as a foreign terrorist organization by the State Department on Sept. 1, 2010.
Court documents indicate that law enforcement agents directed confidential sources to ask the defendants, who were residing in Ecuador at the time, for their assistance in smuggling a fictitious person from Pakistan to the United States. Over the course of the ensuing negotiations, the defendants were made aware that the person to be smuggled was a member of the TTP who was blacklisted in Pakistan.
According to the court documents, the defendants agreed to move this person from Pakistan into the United States, despite his purported affiliation with the TTP. Ul Haq, according to the court documents, told the confidential sources that it was “not their concern” what the men “want to do in the United States – hard labor, sweep floor, wash dishes in a hotel, or blow up. That will be up to them.” The defendants accepted payment from the confidential sources for the smuggling operation and procured a false Pakistani passport for the purported TTP member.
The investigation was conducted by the HSI attaché office in Quito, Ecuador, with the HSI office in Atlanta, the Miami Division of the FBI and the Ecuadorian National Police.
The investigation was conducted under the Extraterritorial Criminal Travel Strike Force (ECT) program, a joint partnership between the Justice Department’s Criminal Division and HSI. The ECT program focuses on human smuggling networks that may present particular national security or public safety risks, or present grave humanitarian concerns. ECT has dedicated investigative, intelligence and prosecutorial resources. ECT coordinates and receives assistance from other U.S. government agencies and foreign law enforcement authorities.
The Criminal Division’s Office of International Affairs, the U.S. National Central Bureau of INTERPOL, the U.S. Customs and Border Protection, the U.S. Embassy in Quito and the government of Ecuador provided invaluable support.
The case was prosecuted jointly by prosecutors from the Human Rights and Special Prosecutions Section of the Criminal Division, the Counterterrorism Section of the National Security Division and the U.S. Attorney’s Office for the District of Columbia.
Office Manager for Miami Home Health Company Sentenced to 78 Months in Prison for Role in $25 Million Health Care Fraud SchemeRead the Press Release
WASHINGTON – An office manager for a Miami home health care agency was sentenced today to 78 months in prison for her participation in a $25 million home health Medicare fraud scheme, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS). Two of her co-defendants were also sentenced to prison today for their roles in the fraud scheme.
The defendants were sentenced by U.S. District Judge Joan A. Lenard in the Southern District of Florida.
- Lisandra Alonso, 34, was sentenced to 78 months in prison and two years of supervised release and was ordered to pay $15.3 million in restitution.
- Jose Ros, 72, was sentenced to 12 months in prison and three years of supervised release and was ordered to pay $395,000 in restitution.
- Farah Maria Perez, 40, was sentenced to six months in prison and two years of supervised release and was ordered to pay $118,000 in restitution.
Alonso, Ros and Perez each pleaded guilty earlier this year to one count of conspiracy to commit health care fraud. They were each ordered to pay their restitution jointly and severally with co-conspirators and defendants in a related case.
According to court documents, Alonso was an office manager and patient recruiter for ABC Home Health Care Inc., a Miami home health care agency that purported to provide home health and physical therapy services to Medicare beneficiaries. Ros was a patient recruiter for both ABC and Florida Home Health Care Providers Inc., another related home health care agency. Perez was a registered nurse and a patient recruiter for Florida Home Health. According to court documents, ABC and Florida Home Health only existed to defraud Medicare.
Alonso, Ros and Perez admitted that beginning in approximately January 2006 and continuing until approximately March 2009, they recruited Medicare beneficiaries who would allow ABC and Florida Home Health to bill Medicare for home health care and therapy services that were medically unnecessary and/or never provided. Alonso, Ros and Perez solicited and received kickbacks and bribes from the owners and operators of ABC and Florida Home Health in return for the recruited patients. Alonso, Ros and Perez knew that the patients they recruited did not qualify for the services billed to Medicare and that the files for the recruited patients were falsified to make it appear that the patients qualified for the services.
According to court documents, Perez and her co-defendant nurses falsified patient files for Medicare beneficiaries to make it appear that the beneficiaries qualified for home health care and therapy services. Perez admitted that she knew the beneficiaries did not qualify for and did not receive the services. The files were falsified so that Medicare could be billed for medically unnecessary therapy and home health related services.
According to plea documents, as office manager, Alonso taught the owners and operators of ABC how to operate a fraudulent home health agency. Alonso explained the importance of recruiters, kickbacks, doctors, beneficiaries and Medicare billing. In this role, Alonso negotiated the kickback payment rates between the patient recruiters and the owners and operators of ABC. Alonso distributed the kickback payments to the patient recruiters on behalf of the owners and operators of ABC.
As office manager, Alonso also taught nurses at ABC how to falsify patient files for Medicare beneficiaries to make it appear that the beneficiaries qualified for home health care and therapy services when, in fact, she knew that the beneficiaries did not qualify for and did not receive such services.
As a result of the participation of Alonso, Ros and Perez in the illegal scheme, the Medicare program was billed approximately $17 million, $395,000 and $118,000, respectively, for purported home health care services that were not medically necessary and/or were not provided.
The sentences were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; John V. Gillies, Special Agent-in-Charge of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.
This case is being prosecuted by Trial Attorney Joseph S. Beemsterboer of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,160 defendants who collectively have falsely billed the Medicare program for more than $2.9 billion. In addition, the HHS 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 .
New York Return Preparer Pleads Guilty to Preparing False Tax ReturnsRead the Press Release
WASHINGTON – The owner of a Dix Hill, N.Y., tax preparation business pleaded guilty today in U.S. District Court in the Eastern District of New York in Central Islip, N.Y., to endeavoring to obstruct the internal revenue laws and aiding in the preparation of false income tax returns, the Justice Department and Internal Revenue Service (IRS) announced today.
According to court documents, Howard Levine owned and operated Milaur Associates, also known as Milaur Inc. Many of the tax returns prepared by Levine for 2004 through 2009 were false and contained fictitious deductions, business expenses and corporate losses created by Levine. Levine admitted to preparing no fewer than 56 false returns, resulting in a tax loss of $620,844.
In order to obstruct and impede the IRS from determining his role in preparing the returns, Levine included false information in the paid preparer section of the return he prepared. Despite the U.S. District Court for the Eastern District of New York issuing an injunction in 2009 that barred Levine from preparing federal tax returns for anyone other than himself, Levine violated the injunction by continuing to prepare false returns.
Levine faces a potential maximum sentence of six years in prison and a fine of up to $500,000. U.S. District Judge Joseph F. Bianco, who is presiding over the matter, set a sentencing date of April 26, 2012.
The case was investigated by IRS - Criminal Investigation and is being prosecuted by Trial Attorneys Mark Kotila and Jeffrey B. Bender of the Justice Department’s Tax Division.
Minnesota Man Pleads Guilty to Sexual Abuse of MinorsRead the Press Release
WASHINGTON – A Minnesota man pleaded guilty today in federal court in Minneapolis to abusive sexual contact of two minor boys, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; Brig. Gen. Kevin Jacobsen of the U.S. Air Force, Office of Special Investigations; and John Morton, Director of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI).
In pleading guilty before U.S. District Judge Ann D. Montgomery, Joshua Gardner, 29, admitted that sometime between September 1997 and May 2002, he sexually abused two boys under the age of 12 on Kadena Air Force Base, Okinawa, Japan, which as a U.S. Air Force base was in the special maritime and territorial jurisdiction of the United States. At the time of the offenses, Garner resided in Okinawa. According to his plea agreement, Gardner admitted to engaging in sexual acts with both boys.
At sentencing, Gardner faces a maximum penalty of 10 years in prison and a $250,000 fine. A sentencing date has not yet been scheduled by the court.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case is being prosecuted by Trial Attorney Mi Yung Park of CEOS. This case is a result of investigative efforts the U.S. Air Force Office of Special Investigations in Moody Air Force Base, Ga., and ICE-HSI in Minneapolis.