Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
Friday 2 December 2011
Five San Francisco MS-13 Members Sentenced to Life in PrisonRead the Press Release
WASHINGTON – Five San Francisco-area members of the La Mara Salvatrucha (MS-13) gang were sentenced yesterday to life in prison, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Melinda Haag of the Northern District of California.
Marvin Carcamo, aka “Cyco,” 31; Angel Guevara, aka “Peloncito,” 30; Moris Flores, 22; Jonathan Cruz-Ramirez, 22; and Erick Lopez, aka “Spooky,” 23, were sentenced by U.S. District Judge William Alsup in the Northern District of California.
The five defendants were convicted by a jury on Aug. 30, 2011, after a five-month trial. According to the evidence presented at trial, MS-13 is a transnational gang principally composed of individuals of Salvadoran descent that originated in Los Angeles and eventually spread throughout the United States and the world.
MS-13 is organized into local chapters, known as “cliques.” The San Francisco clique — called the “20th Street clique” or simply “20th Street,” after the location it claimed as its home base — has existed since the early 1990s. Since its founding, 20th Street’s principle purpose was to attack and kill rival gang members, including members of the various Norteño and Sureño gangs in the Bay Area of California, as well as individuals who cooperated with law enforcement or defied the gang’s will.
According to the evidence presented at trial, Carcamo and Guevara were MS-13 members since the early 2000s. By 2007, they ascended to the leadership of 20th Street and pushed a new “program,” presented by gang leaders in Los Angeles and El Salvador, that increased violence against rivals and extorted “tax” payments from criminals.
Carcamo and Guevara directed members of 20th Street to threaten micaros — individuals who sold counterfeit identification cards, known as “ micas” — who operated in 20th Street’s territory in the Mission District. In addition, Carcamo and Guevara extended their ambitions by trying to take over the taxation of drug dealers in parts of the Tenderloin District, territory traditionally claimed by the 11th Street Sureño gang. 20th Street’s expansion attempt prompted complaints from the 11th Street Sureños, to which Carcamo and Guevara responded with threats of violence.
According to evidence at trial, by December 2007, Carcamo was arrested for robbery and Guevara was arrested for stabbing three individuals. Flores took over the leadership of the 20th Street clique and, guided by Carcamo and Guevara from jail, continued to pursue the violent new program. As a result, members of 20th Street became particularly violent in 2008.
Among other acts of violence, during the early morning of March 30, 2008, Lopez shot and killed Ernad Joldic and Philip Ng in the vicinity of Persia and Athens Street in the mistaken belief that the victims were Norteño gang members. On May 31, 2008, because of micaro resistance to paying the tax that MS-13 demanded, Cruz-Ramirez shot and killed micaro leader Juan Rodriguez as Rodriguez sat in a car in the vicinity of Laura and Huron Streets.
On July 11, 2008, following a fight the day before between members of 20th Street and micaros, Cruz-Ramirez drove fellow gang member Guillermo Herrera to the vicinity of 20th and Mission Streets, where Herrera chased down micaro Armando Estrada and killed him on a busy street. During the early morning of July 31, 2008, in response to Flores’s order to retaliate for the non-fatal shooting of a 20th Street member’s family by a suspected Norteño, a group of 20th Street members pursued 14-year old Ivan Miranda and, believing he was a Norteño, stabbed him to death in the vicinity of Persia and Madrid Streets.
All five defendants were convicted of racketeering (RICO) conspiracy, conspiracy to commit murder in aid of racketeering, conspiracy to commit assault with a dangerous weapon in aid of racketeering and possession of a firearm in furtherance of a crime of violence. Guevara was also convicted of three counts of attempted murder in aid of racketeering and three counts of assault with a dangerous weapon in aid of racketeering for his role in trying to kill three individuals in December 2007. Cruz-Ramirez was also convicted of the racketeering murder of Armando Estrada and related firearms charges. Lopez was also convicted of the racketeering murders of Ernad Joldic and Philip Ng and related firearms charges.
Co-defendant Guillermo Herrera was also convicted in August 2011 and is scheduled to be sentenced by Judge Alsup on Dec. 8, 2011. He faces a mandatory minimum sentence of life in prison for a racketeering murder charge.
On Nov. 29, 2011, in a separate trial before Judge Alsup, a jury convicted Danilo Velasquez of multiple racketeering offenses. According to evidence presented during trial, Velasquez took over the leadership of the 20th Street clique after Moris Flores’s arrest in October 2008. He is scheduled to be sentenced on Feb. 14, 2012, before Judge Alsup and faces a maximum term of life in prison.
These cases were prosecuted by Trial Attorney Theryn Gibbons of the Organized Crime and Gang Section of the Justice Department’s Criminal Division and Assistant U.S. Attorneys Wil Frentzen, Andrew M. Scoble, David Hall and W.S. Wilson Leung of the Strike Force and Violent Crimes Section of the Northern District of California. The cases were investigated by U.S. Immigration and Customs Enforcement Homeland Security Investigations, with the assistance of the San Francisco Police Department and the Daly City Police Department.
Detroit-Area Clinic Owner Sentenced to 78 Months in Prison for Role in $9.1 Million Medicare Fraud SchemeRead the Press Release
WASHINGTON – Joaquin Tasis was sentenced today to 78 months in prison for his role in a $9.1 million Detroit-area Medicare fraud scheme, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).
Tasis was sentenced by U.S. District Judge Arthur Tarnow in the Eastern District of Michigan. In addition to his prison term, Tasis was sentenced to three years of supervised release and was ordered to pay $6 million in restitution, jointly and severally with his co-defendants.
Joaquin Tasis and co-defendants Martin Tasis and Leoncio Alayon were convicted by a jury in May 2011 after a five-day trial. Evidence presented at trial showed that the Tasis brothers and their co-conspirators helped relocate a highly lucrative infusion therapy fraud scheme to Michigan from South Florida after increased law enforcement scrutiny there, and that Alayon helped the conspirators launder proceeds from the scheme. Martin Tasis was sentenced in October 2011 to 10 years in prison and two years of supervised release for his role in the scheme.
According to evidence presented at trial, Martin and Joaquin Tasis were partners in a Detroit-area clinic called Dearborn Medical Rehabilitation Center (DMRC). Evidence at trial showed that Medicare beneficiaries were not referred to DMRC by their primary care physicians, or for any other legitimate medical purpose, but rather were recruited to come to the clinic through the payment of cash kickbacks. DMRC then billed Medicare for expensive and exotic medications, purportedly administered to treat HIV and Hepatitis-C. However, the medications were never administered.
Once Medicare started paying the co-conspirators, Martin Tasis enlisted Alayon, a family friend, to help him launder the proceeds of the fraud through a shell corporation in Florida called Infinity Research Corp. Evidence at trial showed that Infinity Research Corp. had no employees, did no research and was based at Alayon’s residence. Alayon, after taking a commission for himself, distributed the laundered proceeds to Martin and Joaquin Tasis and their co-conspirators.
Between November 2005 and March 2007, DMRC billed approximately $9.1 million in claims to Medicare for injection therapy services that were never provided and/or were not medically necessary. Medicare paid approximately $6 million of those claims. Evidence at trial showed that DMRC purchased only $36,000 in medication and medical supplies.
Joaquin Tasis was convicted of one count of conspiracy to commit health care fraud, one count of conspiracy to pay health care kickbacks and three counts of health care fraud.
Today’s sentence was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (HHS-OIG) Chicago Regional Office.
The case was prosecuted by Trial Attorney Gejaa T. Gobena of the Criminal Division’s Fraud Section and Assistant U.S. Attorney for the Eastern District of Michigan Philip A. Ross. The FBI and HHS-OIG conducted the investigation.
Since its inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,140 individuals and organizations 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.
Department of Justice Releases Investigative Findings on the Arthur G. Dozier School for Boys and the Jackson Juvenile Offender Center in FloridaRead the Press Release
WASHINGTON – Following a comprehensive investigation, the Justice Department today announced its findings that the state of Florida’s oversight system failed to detect and sufficiently address harmful practices at both the Arthur G. Dozier School for Boys and the Jackson Juvenile Offender Center (JJOC), which together constituted the North Florida Youth Development Center (NYFDC). Despite the closure of these facilities, the deficiencies found by the United States implicate the continuing oversight obligations of the state. The state’s lack of adequate controls permitted these violations to persist. It is incumbent upon the state to ensure that the unconstitutional conditions of confinement identified in the report do not exist at its other juvenile justice institutions.
The United States announced its investigation of the NYFDC facilities on April 7, 2010, in accordance with the Violent Crime Control and Law Enforcement Act of 1994. On May 26, 2011, Florida’s Department of Juvenile Justice (DJJ) announced the pending closure of Dozier and JJOC. The facilities were officially closed on June 30, 2011, and the residents were transferred to juvenile justice institutions throughout the state. The Justice Department found reasonable cause to believe that a pattern or practice of unconstitutional conduct and/or violations of federal law occurred in several areas, including:
- Failure to adequately protect youth from harm;
- Unconstitutional uses of disciplinary confinement;
- Deliberate indifference to youth at risk of self-injurious and suicidal behaviors;
- Violations of youth’s due process rights; and
- Failure to provide necessary rehabilitation services.
These violations were the result of the state’s failed system of oversight and accountability. To protect the youth in its remaining facilities, the state must take immediate measures to assess the full extent of its failed oversight with the assistance of experts in juvenile protection from harm issues. The state must also strengthen its oversight processes by implementing a more rigorous system of hiring, training and accountability.
The United States thanks and acknowledges the state for its cooperation throughout this investigation.
The Violent Crime Control and Law Enforcement Act of 1994 authorizes the Department of Justice to seek a remedy for a pattern or practice of conduct that violates the constitutional or federal statutory rights of youth in juvenile justice institutions.
The full report can be found at www.justice.gov/crt/about/spl/documents/dozier_findltr_12-1-11.pdf. For more information on the Justice Department’s Civil Rights Division, please visit www.justice.gov/crt
Aryan Brotherhood of Texas Member Convicted of Federal Racketeering and Firearms Charges <br /> Related to Jefferson County, Texas, ShootingRead the Press Release
WASHINGTON – A member of the Aryan Brotherhood of Texas (ABT) was convicted yesterday of racketeering and firearms charges related to his role in the 2009 shooting of a man in Jefferson County, Texas, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney John M. Bales of the Eastern District of Texas.
John Oliver Manning, aka “Fish,” 52, of Pasadena, Texas, was charged by a federal grand jury on Mar. 17, 2011, with violent crimes in aid of racketeering activity. The activities include conspiracy to commit assault with a dangerous weapon, assault with a dangerous weapon, using and carrying a firearm during and in relation to a crime of violence and possession of a firearm by a convicted felon.
Co-defendant Joshua Mark Bodine, aka “Desperado,” 32, of Vidor, Texas, pleaded guilty Oct. 11, 2011, to assault with a dangerous weapon in aid of racketeering activity. Bodine has been in custody since his arrest on Feb. 24, 2011, and Manning has been in custody since his arrest on Sept. 9, 2009.
According to the indictment, the ABT is a race-based, state-wide organization that operates inside and outside of state and federal prisons throughout Texas and the United States. The ABT was established in the early 1980s within the Texas prison system. It modeled itself after and adopted many of the precepts and writings of the Aryan Brotherhood, a California-based prison gang that was formed in the California prison system during the 1960s. According to the indictment, previously, the ABT was primarily concerned with the protection of white inmates and white supremacy/separatism. Over time, the ABT expanded its focus to create a criminal enterprise that includes illegal activities for profit.
According to evidence presented at trial, the ABT enforces its rules and promotes discipline among its members, prospects and associates through murder, attempted murder, conspiracy to murder, assault, robbery and threats against those who violate the rules or pose a threat to the enterprise. Members, and oftentimes associates, are required to follow the orders of higher-ranking members, often referred to as “direct orders.”
The evidence at trial established that on Sept. 7, 2009, Manning shot and wounded ABT associate Matthew Fails in Nederland, Texas, on the orders of Bodine. Specifically, Manning approached Fails with a firearm and a pair of handcuffs in an attempt to collect a debt on Bodine’s behalf, and ultimately shot Fails. Fails was declared brain-dead, but later regained consciousness after emergency surgery. A surgeon testified that the wound Fails received caused “agonizing pain” and that Fails “would not ever be the same.”
At sentencing, Manning faces up to life in prison and a mandatory minimum sentence of 25 years in prison. Sentencing dates have not been scheduled for Manning and Bodine.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Nederland Police Department; Orange County, Texas, Constable’s Office, Precinct 2; Jefferson County, Texas, Sheriff’s Office; Williamson County, Texas, Sheriff’s Office; Chambers County, Texas, Sheriff’s Office; Alvin, Texas, Police Department; Mont Belvieu, Texas, Police Department; Texas Department of Criminal Justice. The case was prosecuted by Trial Attorney Cody L. Skipper of the Criminal Division’s Organized Crime and Gang Section and Special Assistant U.S. Attorney Baylor Wortham of the Eastern District of Texas.
Alabama Real Estate Investor Agrees to Plead Guilty to Conspiracy to Rig Bids for the Purchase of Real Estate at Public Foreclosure AuctionsRead the Press Release
WASHINGTON – A Mobile, Ala., real estate investor has agreed to plead guilty today for his role in a conspiracy to rig bids and commit mail fraud at public real estate foreclosure auctions in southern Alabama, the Department of Justice announced.
Charges were filed today in U.S. District Court for the Southern District of Alabama in Mobile against Bobby Threlkeld Jr. Threlkeld was charged with one count of bid rigging to obtain selected real estate at foreclosure auctions and one count of conspiracy to commit mail fraud. The department said that Threlkeld participated in a conspiracy to rig bids by agreeing to refrain from bidding against other investors at public real estate foreclosure auctions in Mobile County and its surrounding areas.
The department said that the primary purpose of the conspiracy was to suppress and restrain competition and to make and receive payoffs in order to obtain selected real estate offered at public foreclosure auctions at noncompetitive prices. When real estate properties are sold at these auctions, the proceeds are used to pay off the mortgage and other debt attached to the property, with remaining proceeds, if any, paid to the homeowner.
“Today’s charges demonstrate that the Antitrust Division vigorously pursues and prosecutes those who take part in conspiracies to rig bids at real estate foreclosure auctions,” said Sharis A. Pozen, Acting Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “The division is committed to working closely with its law enforcement partners to ensure that these real estate auctions are fair and open so that consumers will benefit from competition.”
According to the court documents, between May 2001 and December 2006, Threlkeld conspired with others not to bid against one another at public real estate foreclosure auctions in southern Alabama. After the conspirators’ designated bidder bought a property at the public auctions, which typically take place at the county courthouse, the conspirators would generally hold a secret, second auction at which each participant would bid the amount above the public auction price he was willing to pay. The highest bidder at the secret, second auction won the property. Threlkeld was also charged with conspiring to commit mail fraud by using the U.S. mail in carrying out the conspiracy to defraud financial institutions by paying potential competitors not to bid competitively in the public auctions for foreclosed properties.
Threlkeld was charged with violating the Sherman Act, which carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victim if either amount is greater than the statutory maximum. Threlkeld was also charged with conspiracy to commit mail fraud which carries a maximum penalty of 20 years in prison and a fine in the amount equal to the greatest of $250,000, twice the gross gain the conspirators derived from the crime, or twice the gross loss caused to the victims of the crime by the conspirators.
Today’s charges are the latest filed by the department in its ongoing investigation into bid rigging and fraud at public real estate foreclosure auctions in southern Alabama. In addition to today’s charges, on Sept. 15, 2011, Allen K. French, Harold H. Buchman and Buchman’s company, M & B Builders LLC, were each charged in U.S. District Court for the Southern District of Alabama with one count of bid rigging to obtain selected real estate in southern Alabama at foreclosure auctions. On the same day, M & B Builders was also charged with one count of conspiracy to commit mail fraud. On Oct. 14, 2011, French, Buchman and M & B Builders pleaded guilty to the charges.
The Antitrust Division and the FBI have identified a pattern of collusive schemes among real estate investors aimed at eliminating competition at real estate foreclosure auctions, and today’s charges are part of the department’s ongoing effort to combat this conduct and restore competition to public auctions. The investigation into fraud and bid rigging at certain real estate foreclosure auctions in Southern Alabama is being conducted by the Antitrust Division’s Atlanta Field Office and the FBI’s Mobile Field Office, with the assistance of the U.S. Attorney’s Office for the Southern District of Alabama. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Antitrust Division’s Atlanta Field Office at 404-331-7100 or visit www.justice.gov/atr/contact/newcase.htm.
Today’s charges are part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency 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 on the task force, visit www.StopFraud.gov.
Thursday 1 December 2011
Maryland-Based Viable Communications, Its Owner and a Former Executive Sentenced for Roles in $20 Million Fraud SchemeRead the Press Release
WASHINGTON – The owner and the former vice president for corporate strategy of Viable Communications Inc. were each sentenced yesterday to 108 months and 55 months in prison, respectively, for their roles in a scheme that defrauded the Federal Communications Commission (FCC) of at least $20 million, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and FBI Assistant Director in Charge James W. McJunkin of the Washington Field Office.
John T. C. Yeh, the owner of Viable, a Rockville, Md., company, and his brother, Joseph Yeh, the former vice president for corporate strategy, were also ordered to pay $20 million in restitution to the FCC. Viable pleaded guilty to conspiracy to commit mail fraud and was ordered to forfeit $20 million and pay $20 million in restitution to the FCC.
John Yeh, 64, Joseph Yeh, 66, and Viable were sentenced by U.S. District Judge Joel A. Pisano in Trenton, N.J. Both executives were indicted on Nov. 19, 2009, along with Viable and other employees of Viable, and pleaded guilty to conspiring to commit mail fraud in October 2010. In connection with their sentencings, both men admitted to defrauding at least $20 million from the FCC’s Video Relay Service (VRS), a program designed to pay for services for the hearing disabled.
John Yeh and Joseph Yeh admitted that beginning in approximately fall 2007, they conspired with others to pay individuals to make fraudulent VRS phone calls using Viable’s VRS service. According to court documents, both men paid employees of Viable, who then paid others to make the fraudulent phone calls. Viable then submitted the fraudulent call minutes to the FCC and was paid approximately $390 per hour for all VRS calls that Viable processed.
VRS is an online video translation service that allows people with hearing disabilities to communicate with hearing individuals through the use of interpreters and Web cameras. A person with a hearing disability who wants to communicate with a hearing person can do so by contacting a VRS provider through an audio and video Internet connection. The VRS provider, in turn, employs a video interpreter to view and interpret the hearing disabled person’s signed conversation and relay the signed conversation orally to a hearing person. VRS is funded by fees assessed by telecommunications providers to telephone customers, and is provided at no cost to the VRS user.
These cases are being prosecuted by Deputy Chief Hank Bond Walther and Trial Attorney Robert Zink of the Criminal Division’s Fraud Section and Brigham Cannon, former Trial Attorney in the Fraud Section. The cases were investigated by the FBI’s Washington Field Office, the U.S. Postal Inspection Service and the FCC Office of Inspector General.
Justice Department Opens Investigations into Two Western Pennsylvania State Correctional InstitutionsRead the Press Release
WASHINGTON – The Justice Department announced today that it is opening civil investigations into two state correctional institutions (SCI) in Western Pennsylvania. In accordance with the pattern or practice provision of the Civil Rights of Institutionalized Persons Act (CRIPA), the department will investigate allegations that SCI Pittsburgh failed to adequately protect prisoners from harm, including from prisoner-on-prisoner and officer-on-prisoner violence and sexual violence, in violation of the Eighth Amendment to the U.S. Constitution. In addition, the department will look into whether SCI Pittsburgh officers systematically targeted prisoners for violence and other abuse based on the prisoners’ race, sexual orientation, gender identity or other status, in violation of the Equal Protection Clause of the 14th Amendment to the U.S. Constitution.
The department will also investigate allegations that SCI Cresson provided inadequate mental health care to prisoners who have mental illness, failed to adequately protect such prisoners from harm, and subjected them to excessively prolonged periods of isolation, in violation of the Eighth Amendment to the U.S. Constitution.
The Justice Department will seek to determine whether there is a pattern or practice of violations of the Constitution by officers or staff at SCI Cresson and SCI Pittsburgh. During the course of the investigation, the Justice Department will consider all relevant information. The investigation will include visits to the facilities, a review of records, interviews with corrections officials, prisoners and other witnesses, including family and community members, and advocates. The Justice Department has taken similar steps involving a variety of state and local correctional facilities, both large and small.
Starting on Dec. 2, 2011, the department will be able to receive additional information from community members via email at [email protected].
Today’s announcement is separate from any potential federal criminal investigation involving these facilities.
The Department of Justice’s Civil Rights Division, Special Litigation Section and the U.S. Attorney’s Office for the Western District of Pennsylvania are jointly investigating this matter.
Former White Mountain Apache Tribal Police Officer Pleads Guilty in Arizona to Civil Rights ViolationsRead the Press Release
WASHINGTON – Former White Mountain Apache Tribal police officer, Glenn Cromwell, 35, pleaded guilty today in federal court in Phoenix to two counts of violating civil rights while acting under color of law for detaining, transporting, and then abandoning two adult males in extreme weather conditions on different occurrences in December 2008.
During the plea hearing, Cromwell admitted to violating the constitutional rights of two men by detaining and driving each, in separate incidents, to a remote location and then forcing the men out of the police vehicle and leaving them in the frigid cold. In both instances, Cromwell willfully exceeded and abused his authority under law.
“This police officer had no legitimate purpose for deliberately exposing persons in his custody to perilous conditions,” said Thomas E. Perez, Assistant Attorney General for Civil Rights. “His conduct undermines the dedicated work of the men and women in law enforcement who serve and protect our communities. T he Justice Department is committed to holding officers who engage in such criminal acts accountable.”
Sentencing for Cromwell is scheduled for Feb. 13, 2012. Cromwell faces a possible maximum sentence of one year in prison for each count.
This case was investigated by the Phoenix Field Office of the FBI and was prosecuted by Trial Attorney D.W. Tunnage of the Justice Department’s Civil Rights Division and Assistant U.S. Attorney Alison S. Bachus for the District of Arizona.
Former Indianapolis City-County Councilman Sentenced for Soliciting a Bribe and Attempted ExtortionRead the Press Release
WASHINGTON – Former Indianapolis and Marion County, Ind., City-County Councilman Lincoln Plowman was sentenced today to 40 months in prison , announced Assistant Attorney General Lanny A. Breuer for the Justice Department’s Criminal Division and U.S. Attorney Joseph H. Hogsett of the Southern District of Indiana.
U.S. District Judge Larry J. McKinney also ordered Plowman to serve two years of supervised release following his prison term. Plowman, 48, was convicted by an Indianapolis jury in September 2011 of attempted extortion and soliciting a bribe between Aug. 11, 2009, and Dec. 22, 2009, while serving as a member of the city-county council.
“Mr. Plowman used his elected office for personal financial gain, betraying the trust placed in him by the people of Indianapolis,” said Assistant Attorney General Breuer. “Today’s sentencing shows that public corruption has a steep price. It weakens democratic institutions and undermines the public’s confidence in government. We are determined to continue holding accountable those officials who abuse their positions.”
“Today’s sentencing serves as a warning throughout Indianapolis and across Indiana that our public offices are not for sale,” U.S. Attorney Hogsett said. “Although this tragedy saddens us all, it would be an even greater tragedy if such violations of the public trust went undiscovered and unpunished.”
"The American people have a right to expect honest services from their public officials, and FBI Indianapolis will continue to aggressively investigate those officials who violate the public trust," said FBI Special Agent in Charge Robert J. Holley of the FBI’s Indianapolis Division.
According to evidence presented at trial, Plowman solicited an undercover FBI agent to pay $5,000 in cash and to make a $1,000 campaign contribution for Plowman’s benefit. In exchange for the payments, Plowman offered official actions and influence to facilitate the opening of a strip club in Indianapolis. At the time of the crimes, Plowman was a member of the metropolitan development committee of the city-county council. He was also a major with the Indianapolis Metropolitan Police Department.
Evidence at trial also showed that Plowman had previously accepted bribes from an existing strip club that was part of a national chain ; in exchange , he provided official acts and influence against legislation to ban smoking at clubs in Indianapolis. The evidence showed that the chain feared that legislation would become a model for other jurisdictions.
The case was prosecuted by Senior Trial Attorney Richard C. Pilger of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Joe H. Vaughn for the Southern District of Indiana. The case was investigated by the FBI.
Fifth Cooperating New Orleans Police Officer Sentenced in Danziger Bridge CaseRead the Press Release
WASHINGTON – A former New Orleans Police Department (NOPD) officer was sentenced today to serve five years in prison for his role in covering up a police-involved shooting that occurred on the Danziger Bridge in the days after Hurricane Katrina.
Robert Barrios was one of several officers who rode in a large Budget rental truck to the Danziger Bridge on Sept. 4, 2005, where officers engaged in a shooting incident that left two civilians dead and four others seriously injured.
In April 2010, Barrios admitted that he agreed with other officers to obstruct justice during the investigations that followed the shooting. Barrios also admitted that, prior to giving a formal, audio-taped statement to NOPD investigators, he and other officers participated in a meeting with two sergeants assigned to investigate the shooting, during which the officers were instructed to get their stories straight before giving their formal statements. Barrios further admitted that he lied, in a formal NOPD statement, in order to help cover for his fellow officers, and that the purpose of the conspiracy he joined was to provide false and misleading information in order to ensure that the shootings on the bridge would appear to be legally justified and that the involved officers would therefore be shielded from liability.
Barrios is the fifth cooperating police officer to be sentenced in this case. Former Lieutenant Michael Lohman, former Detective Jeffrey Lehrmann, and former Officers Michael Hunter and Ignatius Hills are all serving federal prison sentences. The five officers who were convicted at trial – Sergeants Kenneth Bowen, Robert Gisevius, and Arthur “Archie” Kaufman; Officer Anthony Villavaso; and former Officer Robert Faulcon – are scheduled to be sentenced by U. S. District Court Judge Kurt Engelhardt on Feb. 14, 2012.
This case was investigated by the New Orleans Field Office of the FBI, and was prosecuted by Deputy Chief Bobbi Bernstein and Trial Attorney Forrest Christian of the Justice Department’s Civil Rights Division, along with Assistant U.S. Attorney Ted Carter for the Eastern District of Louisiana.
Detroit-Area Occupational Therapy Assistant Pleads Guilty to Participating in Medicare Fraud SchemeRead the Press Release
WASHINGTON – A Detroit-area occupational therapy assistant has pleaded guilty for her participation in a Medicare fraud scheme, announced the Department of Justice, FBI and Department of Health and Human Services (HHS).
Vanessa Dowell, 50, pleaded guilty yesterday before U.S. District Court Judge Avern Cohn in the Eastern District of Michigan to one count of conspiracy to commit health care fraud. At sentencing, Dowell faces a maximum penalty of 10 years in prison and a $250,000 fine.
According to the plea documents, Dowell was an uncertified occupational therapy assistant who worked for Jos Campau Physical Therapy, which purported to provide physical and occupational therapy services. In 2005, Dowell was hired by a co-defendant to create and sign falsified occupational therapy files for Jos Campau Physical Therapy, which was owned and operated by two co-defendants. Dowell purported to be a certified occupational therapy assistant and fabricated and signed patient notes for occupational therapy services that she claimed she had provided. In fact, the services were never provided. Furthermore, as an unsupervised and uncertified assistant, Dowell was not permitted to perform the occupational therapy services.
Between approximately June 2005 and May 2007, Dowell and her co-conspirators at Jos Campau submitted or caused the submission of fraudulent physical therapy and occupational therapy claims to the Medicare program. Dowell personally submitted or caused to be submitted approximately $807,760 in claims for occupational therapy services that were never provided.
This guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (OIG) Chicago Regional Office.
This case is being prosecuted by Trial Attorney Catherine K. Dick of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since their inception in March 2007, the strike force operations in nine districts have charged more than 1,140 individuals who collectively have falsely 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, is taking steps to increase accountability and decrease the presence of fraudulent providers.
Barrio Azteca Gang Associates Plead Guilty in El Paso, Texas, to Racketeering ConspiracyRead the Press Release
WASHINGTON – Two associates of the Barrio Azteca (BA) gang have pleaded guilty to 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).
Yesterday, Fabian Rodriguez, 35, aka “Shamoo,” of El Paso, Texas, and today Mexican national Juan Manuel Viscaino Amaro, 41, aka “Porky,” pleaded guilty before U.S. Magistrate Judge Norbert J. Garney in the Western District of Texas, El Paso Division, to racketeering conspiracy.
According to court documents, Rodriguez and Amaro were associates of the BA, which 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 such as Rodriguez and Amaro – 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 Redelf 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.
During the plea hearings, Rodriguez and Amaro admitted to working with the BA in buying and selling illegal drugs on the streets of El Paso and that the gang extorted money from drug dealers operating on the gang’s turf.
According to Rodriguez’s plea agreement, he faces a maximum penalty of life in prison and a $250,000 fine. Under Amaro’s plea agreement, if approved by U.S. District Court Judge Kathleen Cardone, he will receive a 12 year prison term. Sentencing dates for the defendants have not been scheduled.
Thirty-five members and associates of the BA gang, including Rodriguez, Amaro and 11 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. 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.
Alabama Doctor Pleads Guilty; Husband Convicted of Tax FraudRead the Press Release
WASHINGTON – William Paul, formerly of Montgomery, Ala., was convicted today by a federal jury in Montgomery on four counts of tax evasion for the tax years 2004 through 2007, and of one count of failing to file a tax return, the Justice Department and Internal Revenue Service (IRS) announced. Pauls’ wife, Donna Paul, a board-certified rheumatologist, pleaded guilty to one count of tax evasion and one count of filing a false federal income tax return on Nov. 16, 2011.
According to evidence introduced at trial, Donna and William Paul owned and operated a medical practice in Montgomery. The Pauls attempted to evade the assessment and payment of Donna Paul’s income by falsely characterizing her income as loans, by making false statements to IRS employees, and by deliberately causing the non-profit organizations to not file tax returns. Evidence further showed that Donna Paul did not timely file federal individual income tax returns for the years 2004 through 2007. On April 5, 2011, the day IRS-Criminal Investigation special agents arrested her, Donna Paul filed four false tax returns for tax years 2004 through 2007. She testified at trial that each tax return did not include the money she earned from her medical practice.
Based on testimony at trial, William Paul had not filed a federal income tax return since the 1980s. Donna Paul also testified that William Paul ran the business side of the medical practice, initially called “Rheumatology Specialists of Central Alabama,” then “Rheumatology Specialists Arthritis and Osteoporosis Center,” then “Children and Adult Arthritis and Osteoporosis Center.”
Donna Paul faces a potential maximum of eight years in prison and a fine of up to $500,000. William Paul faces a potential maximum of 21 years in prison and a fine of up to $1.1 million.
John A. DiCicco, Principal Deputy Assistant Attorney General for the Justice Department’s Tax Division, and George L. Beck Jr., U.S. Attorney for the Middle District of Alabama, made the announcement.
This case was investigated by IRS-Criminal Investigation and is being prosecuted by Tax Division Trial Attorneys Justin Gelfand and Michael Boteler.
More information about the Justice Department’s Tax Division and its enforcement efforts is available at www.usdoj.gov/tax.
Wednesday 30 November 2011
Washington State Man Convicted of Filing $20 Billion in False Liens Against Former US Attorney and Other Federal OfficialsRead the Press Release
WASHINGTON—Ronald James Davenport, of Chewelah, Wash., was convicted Tuesday of filing more than $20 billion in false liens against four federal government officials, the Justice Department and the Treasury Inspector General for Tax Administration (TIGTA) announced today. A federal jury in the Eastern District of Washington in Spokane returned guilty verdicts on all four counts of filing false retaliatory liens against government officials. The conviction came after a two-day trial before Judge Garr M. King of the District of Oregon, sitting in Spokane by special designation.
According to the evidence presented at trial, in December 2009, Davenport filed false liens against the then-U.S. Attorney and the Clerk of Court for the Eastern District of Washington, as well as an Assistant U.S. Attorney and an Internal Revenue Service Revenue officer. The liens were filed in the public records of Spokane County and Whatcom County, Wash. The defendant claimed in each lien that the victim owed him $5.184 billion and purported to attach all of the victim’s real and personal property as security for this debt. As proved at trial, the defendant chose these four victims on account of their service as government officials, namely their involvement in a civil lawsuit against Davenport for about $270,000 in unpaid tax liabilities.
Following his conviction, Davenport faces a potential maximum sentence of 40 years in prison and a fine of up to $1 million. Judge King has not set a sentencing date.
The case was investigated by TIGTA and prosecuted by Trial Attorneys Brian D. Bailey and Hayden M. Brockett of the Justice Department’s Tax Division. Both the U.S. Attorney’s Office and the District Court for the Eastern District of Washington were recused from the case.
Two New Jersey Dietary Supplement Firms and Their Principals Sentenced for Criminal ContemptRead the Press Release
WASHINGTON – New Jersey-based dietary supplement companies Quality Formulation Laboratories Inc. (QFL) and American Sports Nutrition Inc. (ASN), as well as their owner, Mohamed S. Desoky, and managers, Ahmad Desoky Esq., and Omar Desoky, were sentenced today for multiple counts of criminal contempt of court for violating a consent decree entered by the U.S. District Court for the District of New Jersey on March 16, 2010, the Justice Department announced.
The defendants’ businesses manufactured and distributed food products and supplements, including many varieties of protein powder mixes sold in health food stores, as well as other powder mixes and dietary supplements. The defendants’ products were distributed under the ASN brand to locations throughout the United States.
U.S. District Court Chief Judge Garrett E. Brown Jr. sentenced Mohamed S. Desoky to a term of 40 months in prison, three years supervised release and a fine of $60,000; Ahmad Desoky Esq., to a term of 34 months in prison, three years supervised release and a fine of $12,000; and Omar Desoky to a term of 34 months in prison and three years supervised release. In addition, Judge Brown ordered QFL and ASN to pay criminal fines totaling $1 million, and placed them on probation for a period of three years. All defendants, the individuals and the corporations, were prohibited from doing business in the dietary supplement industry during their periods of supervised release or probation unless they first obtained consent of the U.S. Food and Drug Administration and the Court. Ahmad Desoky was barred from practicing law during his period of supervised release. In imposing sentence, the court commented that defendants’ criminal contempt was unique in its persistence and scope.
The complaint in the civil case that led to the court order alleged that the defendants, which included Mohamed S. Desoky, QFL and ASN, adulterated food by manufacturing them without following the Food and Drug Administration’s (FDA) regulations regarding current good manufacturing practice (CGMP) requirements.
The complaint alleged that the defendants caused misbranding of food because the food contained milk, a major food allergen, not declared on the product labels. The civil complaint went on to allege that defendants’ failure to have adequate sanitizing and cleaning operations and follow their own procedures for manufacturing products on dedicated equipment may have led to food being contaminated with this major food allergen by virtue of “cross-contamination” or “cross-contact” in the manufacturing process.
The civil complaint also alleged that during an FDA inspection of the defendant’s facility in January 2009, FDA investigators observed a dead rodent—cut in half—on a blender motor platform; a dead rodent, surrounded by rodent excreta pellets, in an area used to store near-finished product; and, on two occasions, a live rodent running through the blending room.
The consent decree that settled the civil action required that defendants shut down their manufacturing operation and not reopen there or elsewhere without first correcting these violations and getting FDA’s approval to reopen. The criminal contempt charges alleged that Ahmad Desoky and Omar Desoky, with knowledge of the court’s order, assisted their father, Mohamed S. Desoky, in violating the order, and thus were criminally liable for the violations even though they were not named as defendants in the original civil case.
“After the FDA found egregious sanitation and manufacturing problems at the defendants’ facility, we obtained a court order requiring the defendants to clean up their act,” said Tony West, Assistant Attorney General of the Civil Division of the Department of Justice. “Instead of complying with that order, the defendants thumbed their nose at it and continued distributing product. The court’s appropriately stiff sentences in this case make clear the lesson: If you jeopardize the health and safety of the American people, we will hold you accountable.”
The petition for criminal contempt charged all five defendants with violating the decree almost immediately upon its entry by setting up operations at a separate location in Congers, N.Y., to which they transported their employees and equipment. In addition, the petition alleged that the defendants violated the decree by failing to notify FDA of this relocation of their operations. On June 1, 2011, a jury found all five defendants guilty of these charges.
The petition also alleged that QFL, Mohamed S. Desoky, Ahmad Desoky and Omar Desoky continued receiving and manufacturing operations at their Paterson. N.J., facility despite the court’s order. These defendan ts were found guilty of this charge as well.
Finally, the petition alleged that QFL, Mohamed S. Desoky, and Ahmad Desoky received and distributed product at their Paterson facility between September 2010 and January 2011, in violation of the court’s order. The jury found these defendants guilty of this count.
Assistant Attorney General West thanked the FDA for the referral of the civil case and the diligent investigation of the ensuing violations of the court’s order.
The prosecution of these defendants was handled by Department of Justice, Civil Division, Consumer Protection Branch Trial Attorneys David Sullivan and Patrick Runkle, and District of New Jersey Assistant U.S. Attorney Howard Wiener. The FDA Office of Chief Counsel Attorney Shannon Singleton supported the matter, which was investigated criminally by the FDA Office of Criminal Investigations, Jersey City Branch, and civilly by the FDA New Jersey District Office.
Taiwan Aftermarket Auto Lights Manufacturer and Its Chairman Indicted for Participation in Price-Fixing ConspiracyRead the Press Release
WASHINGTON – A federal grand jury in San Francisco returned a superseding indictment yesterday against a Taiwan aftermarket auto lights manufacturer, its U.S.-based subsidiary distributor and its chairman for participating in an international conspiracy to fix the prices of aftermarket auto lights, the Department of Justice announced. Aftermarket auto lights are incorporated into an automobile after its original sale, often as repairs following a collision or as accessories and upgrades.
The one-count felony superseding indictment, filed today in U.S. District Court in San Francisco, charges that Eagle Eyes Traffic Industrial Co. Ltd., which is based in Tainan County, Taiwan, participated in a conspiracy to fix the prices of aftermarket auto lights in the United States and elsewhere from about July 2001 to about September 2008. The indictment also charges Eagle Eyes’ highest-ranking officer, Chairman Yu-Chu Lin, aka David Lin, for his participation in the conspiracy from about July 2001 to about September 2008. Lin is a resident of Taiwan. E-Lite Automotive Inc., Eagle Eyes’ U.S. subsidiary based in Chino, Calif., is also charged in the indictment for its participation in the conspiracy from about March 2006 to about September 2008. Today’s indictment supersedes an indictment filed on July 19, 2011, against the second-highest-ranking officer of Eagle Eyes, Vice Chairman Homy Hong-Ming Hsu.
“The Antitrust Division will continue to crack down on international price-fixing conspiracies that target U.S. businesses and consumers,” said Sharis A. Pozen, Acting Assistant Attorney General in charge of the Department of Justice’s Antitrust Division.
According to the indictment, Eagle Eyes, E-Lite, Lin, Hsu and co-conspirators participated in a conspiracy in which the participants met and agreed to charge prices of aftermarket auto lights according to jointly determined formulas. The participants in that conspiracy issued list price announcements to customers in accordance with the jointly determined price structure, and collected and exchanged information on prices for the purpose of monitoring and enforcing adherence to the conspiracy. The department said that the conspirators met in Taiwan and the United States for their discussions.
Including Eagle Eyes, E-Lite and Lin, four companies and four individuals have been charged to date in connection with the department’s ongoing investigation into the aftermarket auto lights industry. On Nov. 15, 2011, Maxzone Vehicle Lighting Corp., a U.S. distributor of aftermarket auto lights, pleaded guilty and was sentenced to pay a $43 million criminal fine for its participation in the conspiracy. On Oct. 4, 2011, Sabry Lee (U.S.A.) Inc., a U.S. distributor of aftermarket auto lights, pleaded guilty and was sentenced to pay a $200,000 criminal fine for its participation in the conspiracy. On March 29, 2011, Polo Shu-Sheng Hsu, the former president and CEO of Maxzone, was sentenced to serve 180 days in prison and to pay a $25,000 criminal fine for his role in the conspiracy. Chien Chung Chen, aka Andrew Chen, the former executive vice president of Sabry Lee, pleaded guilty for his participation in the conspiracy on June 7, 2011. He is currently scheduled to be sentenced on July 17, 2012.
Eagle Eyes, E-Lite and Lin are charged with price fixing in violation of the Sherman Act which carries a maximum penalty of 10 years in prison and a $1 million fine for individuals and $100 million fine for corporations. The maximum fines 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.
This case is part of an ongoing joint investigation being conducted by the Department of Justice Antitrust Division’s San Francisco Office and the FBI in San Francisco. Anyone with information concerning illegal or anticompetitive conduct in the aftermarket auto lights industry is urged to call the Antitrust Division’s San Francisco Field Office at 415-436-6660 or visit www.justice.gov/atr/contact/newcase.htm.
Pompano Beach, Fla.-Area Assisted Living Facility Owner Pleads Guilty to Fraud and Kickback SchemeRead the Press Release
WASHINGTON – The owner and operator of a Pompano Beach, Fla.-area assisted living facility pleaded guilty today for his role in a Medicare fraud kickback scheme that funneled patients through a fraudulent mental health company and a Medicaid fraud scheme that billed for assisted living services that were never provided, announced the Department of Justice, the FBI, the Department of Health and Human Services (HHS) and the Medicaid Fraud Control Unit (MFCU) of the Florida Office of the Attorney General.
Joseph B. Williams, 41, pleaded guilty before U.S. District Judge Jose E. Martinez in Miami to two counts of conspiracy to commit health care fraud. Williams was the owner and operator of Avondale Manors Retirement Home, an assisted living facility operating in Pompano Beach, and a company called Diversified Marketing Group Inc.
Williams admitted that in exchange for illegal health care kickbacks, he agreed to provide Medicare beneficiaries who resided at Avondale to American Therapeutic Corporation (ATC) for intensive mental health treatment called partial hospitalization program services. ATC purported to operate partial hospitalization programs in seven different locations throughout south Florida and Orlando. According to court documents, Williams was paid approximately $30 per beneficiary per day the beneficiary attended ATC. ATC paid the kickbacks mostly by check made out to Diversified.
According to his plea, Williams knew that ATC fraudulently billed Medicare for the partial hospitalization program treatment that his referrals purportedly received.
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 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 partial hospitalization program services. Ultimately, ATC and ASI billed Medicare for more than $200 million in medically unnecessary services.
Williams also admitted that he billed Medicaid for assisted living services purportedly provided at Avondale when, in fact, those services were never provided. Williams paid owners and operators of halfway houses to obtain the personal identifiers of Medicaid enrollees who resided in those halfway houses and used that information to bill Medicaid fraudulently. Williams also billed Medicaid for assisted living services provided to residents of Avondale at times when they were not receiving any services.
According to the plea agreement, Williams’s participation in the fraud resulted in more than $2 million in fraudulent billing to the Medicare and Medicaid programs. At sentencing, scheduled for Feb. 8, 2012, Williams faces a maximum of 10 years in prison and a $250,000 fine for each count.
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, HHS-OIG and 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 Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force operations in nine locations have charged more than 1,140 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.
Ohio Insurance Salesman Arrested on Tax ChargesRead the Press Release
WASHINGTON - William A. Herder of Mifflin Township, Ohio, was arrested today on federal tax charges, the Justice Department and Internal Revenue Service (IRS) announced. On Nov. 9, 2011, a federal grand jury sitting in Cleveland returned an indictment against Herder, charging him with corruptly endeavoring to impair and impede the due administration of the internal revenue laws, tax evasion and failure to file tax returns.
According to the indictment, Herder, an insurance salesman, has not filed a timely or valid tax return in more than a decade. For the 2000 tax year, Herder allegedly filed a tax return on which he falsely claimed that he had not earned any income. Herder failed to file any tax returns for the 2001-2009 tax years, despite receiving numerous warnings and notices from the IRS.
The indictment further alleges that, to prevent the IRS from collecting his unpaid taxes, Herder attempted to conceal his assets and income. In 2003, Herder allegedly transferred title to his house to a fake foundation he established in Utah called the “Mentor Foundation.” Herder cashed out an Individual Retirement Account and a life insurance policy to further frustrate IRS collections activity. Herder also allegedly attempted to use a fake financial instrument to pay his taxes for the years 2000-2002 as well as a civil penalty that the IRS assessed against him for the year 2000.
In addition to failing to file valid tax returns and hiding his assets from the IRS, the indictment alleges, Herder submitted numerous obstructive letters and documents to the IRS and the companies for whom he sold insurance in an effort to prevent the IRS from assessing and collecting his taxes. In these letters, Herder falsely claimed, among other things, that the tax laws were not applicable to him.
This case is being prosecuted by Trial Attorneys Melissa S. Siskind and Sean R. Delaney of the Justice Department’s Tax Division.
An indictment is only an allegation of criminal conduct and is not evidence of guilt. A person is presumed innocent until and unless proven guilty beyond a reasonable doubt in a court of law.
More information about the Tax Division and its enforcement efforts is available at www.usdoj.gov/tax/.
Member of Aryan Brotherhood Sentenced to 450 Months in Prison in Connection with Hate Crime Involving Church Arson and Attempted Murder of Disabled African-American in TexasRead the Press Release
WASHINGTON – Steven Scott Cantrell, 26, of Crane, Texas, was sentenced today for hate crime charges stemming from a series of racially-motivated arsons in December 2010, including the arson of a historic African-American church as part of an effort to murder a disabled African-American man, the Justice Department announced today.
Cantrell was sentenced to 450 months in prison by U.S. District Judge Robert A. Junell in Midland, Texas, after pleading guilty to damaging religious property and interfering with housing rights in violation of federal hate crime laws. Cantrell was also ordered to pay $550,780 in restitution to the victims.
Cantrell admitted that on Dec. 28, 2010, he set fire to Faith in Christ Church, a predominantly African-American church, as part of an effort to murder a disabled African-American man who he saw passing by the church in his wheelchair. Cantrell admitted that he started the fire intending to kill the disabled African-American man whom he believed lived at a shelter within the church. The man was not hurt. Cantrell ransacked the church, wrote a series of threatening and racist messages in large letters across the wall of the church next to the pastor’s office, and “tagged” the church with references to the Aryan Brotherhood.
The arson of Faith in Christ Church was part of a series of racially-motivated arsons that Cantrell perpetrated that day in his attempt to gain status with the Aryan Brotherhood of Texas. In addition to the church, Cantrell admitted that he set fire to the house of another man in the community because he believed that man to be Jewish and because he sought to injure, intimidate or interfere with that man’s right to rent or occupy that house. Cantrell also admitted to setting fire to Craig’s Gym in violation of federal arson laws. At his plea hearing, Cantrell acknowledged that he set fire to Craig’s Gym because he believed the owners served Mexican-Americans and African-American patrons and because the gym was owned by a Caucasian man married to a woman of Mexican descent. Cantrell added that he felt “disrespected” by a Caucasian man marrying a woman of Mexican descent because he believed “the white race needed to be kept pure.”
“Today’s sentence reflects the vile nature of this defendant’s actions. Every person, regardless of race, national origin, religion or disability, should have the opportunity to live without fear of threat or harm,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The department will continue to vigorously prosecute those that commit heinous acts like this one.”
“When hatred and bigotry are expressed through acts of violence and destruction, this office will use every resource available to ensure that those responsible are found, prosecuted and punished,” stated U.S. Attorney for the Western District of Texas Robert Pitman. “There is simply no room in a civilized society for the kind of conduct Cantrell engaged in.”
“Today’s sentencing represents the FBI’s commitment to prosecuting individuals responsible for committing these types of crimes,” said FBI Special Agent in Charge Mark Morgan of the El Paso, Texas, office. “The FBI will continue to aggressively investigate federal violations of this nature and prosecute those responsible to the full extent of the law. Through the cooperative efforts of the state, local and federal agencies, FBI Midland successfully completed its investigation.”
This case was jointly investigated by the FBI; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Crane Police Department; and the Texas Department of Insurance. The case was prosecuted by Trial Attorney Victor Boutros from the Justice Department’s Civil Rights Division and Assistant U.S. Attorney John Klassen for the Western District of Texas, with the cooperation of the district attorney for the 109th Judicial District of the state of Texas.
Former Executive of Peruvian Airline Pleads Guilty to Fixing Fuel Surcharge Rates on Air Cargo Shipments Following Hurricanes Katrina and RitaRead the Press Release
WASHINGTON — A former executive of a Peruvian airline pleaded guilty today for his role in a conspiracy to fix surcharges on air cargo shipments from the United States to South and Central America following Hurricanes Katrina and Rita, the Department of Justice announced.
George Gonzalez, former chief commercial officer of Cielos Airlines, a Peruvian air cargo carrier, pleaded guilty today in the Southern District of Florida to a one count charge of price fixing. On Oct. 28, 2010, Gonzalez and three other former airline executives were charged in Miami with conspiring to suppress and eliminate competition by agreeing to impose an increase to their fuel surcharges on air cargo shipped from the United States to locations in South and Central America. The indictment charged the executives with participating in the conspiracy beginning in or around late September 2005 until at least November 2005.
Air cargo carriers transport a variety of cargo shipments, such as heavy equipment, perishable commodities and consumer goods, on scheduled international flights.
On Sept. 19, 2011, two of the other indicted former airline executives pleaded guilty to the charge. Guillermo “Willy” Cabeza, former president of Arrow Air, a Miami-based air cargo carrier, and Luis Juan Soto, former president of South Winds Cargo, a Miami-based air cargo carrier, pleaded guilty to the charge and are awaiting sentencing. In connection with their pleas, Gonzalez, Cabeza and Soto have each agreed to cooperate with the department in its investigation and to pay a criminal fine.
Gonzalez, Cabeza and Soto pleaded guilty to price fixing in violation of the Sherman Act, which carries a maximum $1 million fine and up to 10 years in prison. 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.
A total of 22 airlines and 21 executives, including Gonzalez, Cabeza and Soto, have been charged in the Justice Department’s ongoing investigation into price fixing in the air transportation industry. To date, more than $1.8 billion in criminal fines have been imposed and four executives have been sentenced to serve prison time.
Today’s guilty plea arose from an ongoing joint investigation into the air transportation industry being conducted by the Antitrust Division’s National Criminal Enforcement Section and the Chicago Field Office, the FBI’s field offices in Miami and Washington, D.C., the Department of Transportation’s Office of Inspector General and the U.S. Postal Service’s Office of Inspector General. Anyone with information concerning price fixing or other anticompetitive conduct in the air transportation industry is urged to call the Antitrust Division’s National Criminal Enforcement Section at 202-307-6694, visit www.justice.gov/atr/contact/newcase.htm or call the FBI’s Miami Field Office at 305-654-1918.
Tuesday 29 November 2011
Patient Recruiter Pleads Guilty in Connection with $5.4 Million Medicare Fraud Scheme in DetroitRead the Press Release
WASHINGTON – A patient recruiter pleaded guilty today for his participation in a Medicare fraud scheme operated out of three Detroit-area health care clinics, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).
Santiago Villa-Restrepo, 33, of Miami, pleaded guilty before U.S. District Judge Arthur J. Tarnow in the Eastern District of Michigan to one count of conspiracy to commit health care fraud. At sentencing, Villa-Restrepo faces a maximum penalty of 10 years in prison and a $250,000 fine.
According to the plea documents, Villa-Restrepo recruited Medicare beneficiaries for three Detroit-area health care clinics owned by co-conspirators. In exchange for cash bribes paid by Villa-Restrepo and others, the beneficiaries agreed to attend the clinics where they provided their Medicare provider numbers and other information, which allowed the clinics to bill for diagnostic tests that were medically unnecessary, and in some cases, not provided at all. According to court documents, Medicare was billed $5.4 million for medically unnecessary diagnostic tests by the clinics associated with the scheme.
Today’s guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (OIG) Chicago Regional Office.
This case is being prosecuted by Assistant U.S. Attorney Philip A. Ross of the Eastern District of Michigan, with assistance from Acting Assistant Chief Benjamin D. Singer of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since their inception in March 2007, the Medicare Fraud Strike Force operations in nine districts have charged more than 1,140 individuals who collectively have falsely 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, is taking steps to increase accountability and decrease the presence of fraudulent providers.
Owner of Houston Health Care Company Pleads Guilty to Defrauding MedicareRead the Press Release
WASHINGTON – The owner of a Houston health care company pleaded guilty today in connection with a Medicare fraud scheme involving durable medical equipment (DME), announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).
Akinsunbo Akinbile, 44, pleaded guilty before U.S. District Judge Keith P. Ellison in Houston to eight counts of health care fraud.
Akinbile admitted that he was the owner and operator of Hallco Medical Supply, a company that purported to provide DME to Medicare beneficiaries. According to court documents, Hallco submitted claims to Medicare for DME, including orthotic devices, that were medically unnecessary and/or never provided. Many of the orthotic devices were components of “arthritis kits,” and purported to be for the treatment of arthritis-related conditions. The arthritis kits generally contained a number of devices including braces for both sides of the body and related accessories such as heat pads. In total, from June 2007 through May 2009, Hallco submitted approximately $737,770 in fraudulent claims to Medicare.
At sentencing, scheduled for Feb. 15, 2012, Akinbile faces a maximum sentence of 10 years in prison.
Today’s guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Kenneth Magidson of the Southern District of Texas; Special Agent-In-Charge Stephen L. Morris of the FBI’s Houston Field Office; Special Agent-in-Charge Mike Fields of the Dallas Regional Office of HHS’s Office of the Inspector General (HHS-OIG) and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU).
The case was prosecuted by Trial Attorney Laura M.K. Cordova and Assistant Chief Sam S. Sheldon of the Criminal Division’s Fraud Section. The case was brought as part of the Medicare Fraud Strike Force, supervised by the U.S. Attorney’s Office for the Southern District of Texas and the Criminal Division’s Fraud Section.
Since their inception in March 2007, Medicare Fraud Strike Force operations in nine locations have charged more than 1,140 defendants who collectively have falsely 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.
MS-13 Gang Leader in San Francisco Convicted of Racketeering ChargesRead the Press Release
WASHINGTON – A federal jury today convicted Danilo Velasquez, aka “Triste,” a local leader of La Mara Salvatrucha, or MS-13, in federal court in San Francisco of racketeering conspiracy and related charges, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Melinda Haag for the Northern District of California and Clark Settles, Special Agent in Charge for U.S. Immigration and Custom Enforcement’s (ICE) Homeland Security Investigations (HSI) in San Francisco. His co-defendant and fellow MS-13 member, Luis Herrera, aka “Killer,” pleaded guilty to related charges, including using a firearm that caused the murder of an individual.
After a four-week trial, the federal jury convicted Velasquez of all charges, including conspiracy to participate in a racketeering enterprise, conspiracy to commit murder in aid of racketeering, conspiracy to commit assault with a dangerous weapon in aid of racketeering, and using and discharging a firearm in connection with a crime of violence. The evidence presented during trial showed that the defendants were part of the violent, transnational gang known as MS-13, which claimed part of the Mission District of San Francisco as its territory and operated in the Bay Area since the 1990s. Since its inception, MS-13 members have warred with rival gang members and sought to extort payments from other criminals in the gang’s territory. After the federal government indicted a large number of local MS-13 members on Oct. 22, 2008, Velasquez assumed leadership on the streets and encouraged the remaining members of the gang to engage in violence in order to demonstrate their continued presence in San Francisco despite its loss in numbers due to the federal indictment.
“In a hail of gunfire, Mr. Velasquez and his co-conspirators killed and wounded four unarmed individuals – all in the name of MS-13,” said Assistant Attorney General Breuer. “Senseless acts of violence like those committed by Mr. Velasquez and his fellow gang members are too common across the United States. Through sustained enforcement, we have taken leaders of MS-13 in San Francisco and elsewhere off the streets, and we will continue our efforts to make all our communities safe from violent gangs.”
“This conviction marks the beginning of the end for one San Francisco gang leader who thought he was above the law,” said U.S. Attorney Haag. “Today, the jury has sent a strong message that senseless acts of violence like those committed by Mr. Velasquez in the name of MS-13 will not be tolerated. Life is too valuable to let someone steal it from another. Those who try will be prosecuted to the fullest extent of the law.”
“The gang members targeted in this Homeland Security Investigations-led probe were the worst of the worst, blithely using violence, intimidation and fear to maintain control over their turf,” said Special Agent in Charge Settles for ICE-HSI in San Francisco. “As this jury’s verdict makes clear, we will not allow ruthless thugs to rule our streets. We are joining forces with local law enforcement to bring these criminals to justice and take back our Bay Area neighborhoods.”
The evidence presented at trial also showed how the defendants, with others, conspired to commit a variety of crimes to further the goals of the gang, including attacking and killing rival gang members and others who defied or challenged MS-13 including four murders that occurred in 2008. The prosecution also presented evidence of three separate shootings committed by Herrera, Velasquez and other MS-13 gang members that took place within just two months, after the October 2008 indictment. One of the shootings resulted in the death of Moises Frias, a college student, in February 2009.
Evidence at trial established that on Feb. 19, 2009, Velasquez and Herrera, accompanied by MS-13 member Jaime Balam, a fugitive, went out looking to kill rival gang members in the San Francisco Bay area. Herrera drove Velasquez and Balam in a stolen vehicle, and Velasquez and Balam both carried semi-automatic guns. The evidence at trial showed that in the Excelsior District of San Francisco, Herrera and Velasquez spotted a car of young Latino professionals, including three college students, a student and a business professional. None of the individuals were gang members themselves.
Witnesses testified that Herrera, Velasquez and Balam followed the victims’ car into Daly City, boxed the car in at a red light, whereby Velasquez and Balam flanked the victims’ car carrying semi-automatic handguns. Velasquez then fired multiple shots at close range at three of the passengers, who survived largely because Velasquez’s semi-automatic gun jammed multiple times. Balam allegedly fired his weapon at the remaining passenger until he ran out of bullets. The victim suffered nine gunshot wounds, including to the head, and was killed. The survivors of the shooting testified at trial that the victim begged for the shooting to stop immediately before he died.
A few days before the shooting, Velasquez and Herrera shot and wounded two individuals in rival gang territory on Feb. 13, 2009. After the Feb. 19, 2009, murder, the evidence showed Velasquez ordered another shooting in which Herrera took part, resulting in the wounding of several victims in rival territory on March 2, 2009. The victims of all the two non-fatal shootings who testified during the trial stated that they were not gang members, but were approached by individuals who exclaimed “La Mara” before shooting them.
Herrera pleaded guilty to seven racketeering related counts, including use of a firearm causing the death of Frias. As part of his plea, Herrera admitted that he was part of the MS-13 hunting party that followed the victims’ car on Feb. 19, 2009, and murdered Frias. The evidence presented at trial before Herrera pleaded guilty showed that he was a member of MS-13 for only two to three months before being arrested. He became a member after his brother, Guillermo Herrera, aka “Sparky,” another MS-13 member, was indicted. Guillermo Herrera was recently convicted of all charges, including murder in aid of racketeering, after a five-month trial that included six other co-defendants. He faces a mandatory life sentence and will be sentenced on Dec. 7, 2011. As part of his guilty plea, Luis Herrera will receive a 35-year prison sentence when he is sentenced on Jan. 24, 2012.
Velasquez faces a maximum sentence of life in prison, with a mandatory minimum sentence of 10 years. Sentencing for Velasquez is scheduled for Feb. 14, 2012, before U.S. District Court Judge William H. Alsup.
The case is being prosecuted by Assistant U.S. Attorneys Andrew Scoble and David Hall of the Organized Crime Strike Force of the U.S. Attorney’s Office for the Northern District of California, and Trial Attorney Theryn G. Gibbons of the Criminal Division’s Organized Crime and Gang Section. The case was investigated by Daly City Police Department, led by Detective Gregg Oglesby, and ICE-HSI, led by Special Agents Alicia MacDonald and Brick Eubank .
Lafarge North America Inc. Agrees to Pay $740,000 Penalty to Resolve Clean Water Act Violations in Five StatesRead the Press Release
WASHINGTON – Lafarge North America Inc., one of the largest suppliers of construction materials in the United States and Canada, and four of its U.S. subsidiaries have agreed to resolve alleged Clean Water Act violations. The violations include unpermitted discharges of stormwater and failure to comply with stormwater permits at 21 stone, gravel, sand, asphalt and ready-mix concrete facilities in Alabama, Colorado, Georgia, Maryland and New York. Stormwater flowing over concrete manufacturing facilities can carry debris, sediment and pollutants including pesticides, petroleum products, chemicals and solvents, which can have a significant impact on water quality.
Lafarge will implement a nationwide evaluation and compliance program at 189 of its similar facilities in the United States to ensure they meet Clean Water Act requirements. Lafarge will also pay a penalty of $740,000 and implement two supplemental environmental projects, in which the company will complete conservation easements to protect approximately 166 acres in Maryland and Colorado. The value of the land has been appraised at $2.95 million. Lafarge will also implement one state environmentally beneficial project to support environmental training for state inspectors. The state project is valued at $10,000.
The comprehensive evaluation will include a compliance review of each facility’s permit, an inventory of all discharges to U.S. waters and identification of all best management practices in place. In addition, Lafarge must identify an environmental vice president responsible for coordinating oversight of compliance with stormwater requirements, at least two environmental directors and several environmental managers to oversee stormwater compliance at each operation, and an onsite operations manager at each facility. The U.S. estimates that Lafarge will spend approximately $8 million over five years to develop and maintain this compliance program.
The company will also develop and implement an extensive management, training, inspection and reporting system to increase oversight of its operations and compliance with stormwater requirements at all facilities that it owns and/or operates
“Owners and operators of industrial facilities must take the necessary measures to comply with stormwater regulations under the Clean Water Act, which protects America’s rivers, lakes and sources of drinking water from harmful contamination,” said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “The system-wide management controls and training that this settlement requires from Lafarge and its subsidiaries will result in better management practices and a robust compliance program at hundreds of facilities throughout the nation that will prevent harmful stormwater runoff.”
“EPA is committed to protecting America’s waters from polluted stormwater runoff,” said Cynthia Giles, Assistant Administrator for the Environmental Protection Agency’s Office of Enforcement and Compliance Assurance. “Today’s settlement will improve stormwater management at facilities across the nation, preventing harmful pollutants from being swept into local waterways.”
The complaint, filed in federal court with the settlement, alleges a pattern of violations since 2006 that were discovered after several federal inspections at the company’s facilities. The alleged violations included unpermitted discharges, violations of effluent limitations, inadequate management practices, inadequate or missing records and practices regarding stormwater compliance and monitoring, inadequate discharge monitoring and reporting, inadequate stormwater pollution prevention plans and inadequate stormwater training.
The Clean Water Act requires that industrial facilities, such as ready-mix concrete plants, sand and gravel facilities and asphalt batching plants, have controls in place to prevent pollution from being discharged with stormwater into nearby waterways. Each site must have a stormwater pollution prevention plan that sets guidelines and best management practices that the company will follow to prevent runoff from being contaminated by pollutants.
Since being notified of the violations by EPA, the company has made significant improvements to its stormwater management systems.The settlement is the latest in a series of federal enforcement actions to address stormwater violations from industrial facilities and construction sites around the country. The states of Maryland and Colorado are co-plaintiffs and have joined the proposed settlement.
Lafarge is required to pay the penalty within 30 days of the court’s approval of the settlement. To view the consent decree: www.justice.gov/enrd/Consent_Decrees.html.
More information on the settlement: www.epa.gov/compliance/resources/cases/civil/cwa/lafargenorthamerica.html.
Justice Department Launches Webinar Series on Avoiding Workplace DiscriminationRead the Press Release
The Justice Department announced today the launch of a live webinar series on avoiding workplace discrimination. The webinars coincide with the 25th anniversary of the passage of the Immigration Reform and Control Act, which created the Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC).
OSC enforces the anti-discrimination provision of the Immigration and Nationality Act (INA), which requires employers to treat all authorized workers in the same manner with respect to hiring, firing or recruitment or referral for a fee, regardless of their citizenship status or national origin. The law also prohibits discrimination during the Form I-9 and E-Verify processes.
Participation in the hour-long webinars is free and open to all. The first webinar in the series will advise workers and their advocates of the protections against workplace discrimination. The webinars will begin on Dec. 6, 2011, at 3:00 P.M. EST. A webinar scheduled for 3:00 P.M. EST on Dec. 15, 2011, will advise employers and HR professionals on how to avoid workplace discrimination.
“We are excited to add webinars to our toolkit as a means of educating workers about their rights and employers about their responsibilities under the INA, and to reach these audiences nationwide.” said Thomas E. Perez, the Assistant Attorney General in charge of the Civil Rights Division. “Federal law prohibits discrimination in the employment eligibility verification process, and the Justice Department is committed to enforcing the law.”
To participate in a webinar, sign up online at www.justice.gov/crt/about/osc/webinars.php . For more information about protections against employment discrimination under the immigration law, call OSC’s worker hotline at: 1-800-255-7688 (1-800-237-2525, TDD for the hearing impaired); call OSC’s employer hotline at: 1-800-255-8155 (1-800-362-2735, TDD for the hearing impaired); send e-mail to: [email protected] ; or visit OSC’s website at www.justice.gov/crt/about/osc . If you wish to schedule a webinar for a large or specialized group, please contact OSC’s Public Affairs Specialist Terry Scott, at [email protected] . For reasonable accommodation requests relating to webinars, contact Lyn Sowdon at [email protected] .
Former Massachusetts Scientist and Businessman Sentenced to<br /> Prison for Federal Grant FraudRead the Press Release
WASHINGTON - A former Massachusetts scientist and businessman was sentenced today by U.S. District Judge Rya W. Zobel in Boston to one year and one day in federal prison for executing a fraud scheme involving a multi-million dollar federal research grant.
The sentence was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Carmen M. Ortiz for the District of Massachusetts; William P. Offord, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation (IRS-CI) - Boston Field Office; and Theodore L. Doherty III, Special Agent in Charge of the New England Regional Office of the U.S. Department of Transportation, Office of Inspector General (DOT-OIG).
Christopher D. Willson also w as sentenced to six months of supervised release following his prison term. In addition, Willson was ordered to pay restitution of $100,000 to the Federal Transit Administration (FTA). Willson was convicted at trial in June 2011 of one count of conspiracy to defraud the United States and to commit wire fraud, six counts of wire fraud and four counts of false claims.
According to the evidence presented at trial, Willson was the chief scientist and senior vice president of a Pittsfield, Mass., company called EV Worldwide LLC (EVW). From 2000 through 2005, a federal earmark directed the FTA to transfer approximately $4.3 million to EVW through a regional transit agency called the Pioneer Valley Transit Authority (PVTA). The funds were used by EVW to develop an electric battery that would be used in public transit buses. The federal grant required EVW to match the federal funds, dollar-for-dollar, with its own resources. For every dollar EVW spent on the project, the company could seek up to 50 percent reimbursement from the FTA.
From 2004 through 2005, W illson submitted 10 fraudulent invoices in which he falsely claimed that EVW was matching the FTA funds, when in fact EVW was millions of dollars in debt and had nearly no other non-public source of funds. Evidence and testimony presented at trial also showed that Willson repeatedly contacted and met with U.S. Congressman John Olver’s office and grant officials at the FTA and PVTA to discuss the company’s claimed progress and federal grant funding, but he never informed them of the company’s financial problems. As a result of this deception, Willson fraudulently obtained more than $700,000 in federal funds for EVW.
Willson used the money to pay himself approximately $100,000, to pay EVW’s CEO Michael Armitage approximately $250,000 and to provide approximately $110,000 to fund a separate research company that he and Armitage had founded in Canada called Hydrogen Storage Media Inc., among other things.
In October 2010, Armitage pleaded guilty to one count of conspiracy, one count of false claims and one count of endeavoring to obstruct a federal audit, as well as other unrelated crimes. On Nov. 15, 2011, Armitage was sentenced by U.S. District Judge for the District of Massachusetts Michael A. Ponsor to 66 months in federal prison to be followed by five years of supervised release and was ordered to pay restitution of $4.2 million to the FTA and $215,138 to the PVTA.
The case was investigated by IRS-CI and the DOT-OIG. The Defense Contract Audit Agency also assisted with the investigation. The case is being prosecuted by Assistant U.S. Attorney Steven H. Breslow for the District of Massachusetts and Trial Attorney Edward J. Loya Jr. of the Criminal Division’s Public Integrity Section.
Department of Justice and Federal Trade Commission Meet with Chinese Ministry of Commerce on Merger Enforcement MattersRead the Press Release
WASHINGTON – Acting Assistant Attorney General Sharis Pozen of the Department of Justice’s Antitrust Division and Federal Trade Commission (FTC) Chairman Jon Leibowitz today met with a delegation from China’s Ministry of Commerce (MOFCOM) to discuss antitrust merger enforcement. The delegation was led by China International Trade Representative and MOFCOM Vice Minister Gao Hucheng. MOFCOM is responsible for handling reviews of mergers and acquisitions under China’s Antimonopoly Law.
This is the first high-level MOFCOM visit to the U.S. antitrust agencies since the department and the FTC signed an antitrust memorandum of understanding (MOU) with China’s three antimonopoly agencies in July 2011, to promote communication and cooperation among the antitrust enforcement agencies in both countries.
The discussion topics in today’s meeting included recent antitrust enforcement and policy developments, the role of antitrust enforcement in times of economic downturn and cooperation among the three agencies on merger enforcement issues. The three agencies developed further guidance for cooperation on investigations when one of the U.S. antitrust agencies and MOFCOM are reviewing the same merger.
Department and FTC officials said that the discussions with the delegation from MOFCOM were productive, and that they look forward to continuing their cooperative relationship.
Attorney General Holder Holds Public Hearing on Children Exposed to ViolenceRead the Press Release
WASHINGTON, D.C. – Attorney General Eric Holder’s National Task Force on Children Exposed to Violence convened its first of four public hearings to gather expert and community testimony on the epidemic of children’s exposure to violence. Recent research shows that more than 60 percent of American children have been exposed to crime, abuse and violence – many in their own homes. Ten percent of children in the United States have suffered some form of abuse or neglect and one in 16 has been victimized sexually.
The task force will hold three additional hearings this year in Albuquerque, N.M., Miami and Detroit. The task force will identify promising practices, programming and community strategies used to prevent and respond to children’s exposure to violence and will also issue a final report to the attorney general presenting its findings and comprehensive policy recommendations. The report will serve as a blueprint for preventing children’s exposure to violence and for reducing the negative effects experienced by children exposed to violence across the United States.
“As a former judge and U.S. attorney, and now as the Attorney General and the father of three teenagers, protecting and empowering our children is both a personal and professional commitment," said Attorney General Holder. “I have made protecting the most vulnerable among us – including our children – a core priority of the Justice Department and this task force brings together a wealth of experience and talent to help us find ways to improve our response to the growing problem of children exposed to violence.”
The task force is composed of 13 leading experts from diverse fields and perspectives, including practitioners, child and family advocates, academic experts and licensed clinicians. Joe Torre, Major League Baseball executive vice president of baseball operations, founder of the Joe Torre Safe at Home Foundation, and a witness of domestic violence as a child himself; and Robert Listenbee Jr., chief of the juvenile unit of the Defender Association of Philadelphia, serve as co-chairs of the task force. The full list of Task force members is located at: http://www.justice.gov/defendingchildhood/tf-members.html .
“Unprecedented numbers of children are exposed to violence, both as victims and witnesses, and they bring their experiences, feelings, learned behaviors and attitudes into their schools and communities,” said Torre. “This isn’t just a family issue; it’s also a community and national public health issue. The Defending Childhood Task Force has the welfare of our most vulnerable children at its center, and I look forward to working with my colleagues to make a significant contribution to solving this urgent problem.”
“Children who experience violence are more likely to abuse drugs and alcohol, fail in school, suffer from mental health problems and engage in delinquent and criminal behavior,” said Listenbee. “The attorney general’s task force creates a tremendous opportunity for our nation to stop this epidemic and give our children the safety and well-being they deserve, while creating a healthier society for everyone.”
Speakers at today’s hearing at the University of Maryland Francis King Carey School of Law in Baltimore, included U.S. Attorney General Holder; Sonja Sohn, founder and CEO of ReWired for Change and star of HBO’s “The Wire”; Patrick McCarthy, president and CEO of the Annie E. Casey Foundation; Nigel Cox, chair of the SAVE (Students Against Violence Everywhere) National Advisory Board; and Baltimore and area residents who have experienced family, community and other types of violence.
Details on future hearings will be available on the Defending Childhood website: www.justice.gov/defendingchildhood .
The task force is part of the attorney general’s Defending Childhood Initiative and is staffed by the National Council on Crime and Delinquency (NCCD), a nonprofit research and consulting agency.
To learn more about the task force, visit: www.justice.gov/defendingchildhood/task-force.html .
About the Defending Childhood Initiative and the Task Force
For more information about Attorney General Holder’s Defending Childhood initiative, the Defending Childhood Task Force and upcoming hearings, please visit www.justice.gov/defendingchildhood .
About National Council on Crime and Delinquency
NCCD promotes just and equitable social systems for individuals, families and communities through research, public policy and practice. For more information about NCCD, please visit www.nccd-crc.org .
Attorney General Holder Announces Campaign to Combat Demand for Counterfeit Products in Partnership with the National Crime Prevention CouncilRead the Press Release
WASHINGTON – Attorney General Eric Holder and the Department of Justice’s Bureau of Justice Assistance, in collaboration with the National Crime Prevention Council (NCPC), today announced a new public education campaign to combat the purchase and sale of counterfeit and pirated products. The campaign, launched at the White House, will educate the public on various forms of intellectual property theft, from counterfeit consumer goods and pharmaceuticals to illegal downloads and other pirated materials. The campaign will highlight the potential health, safety and economic consequences for American citizens.
Intellectual property (IP) crime refers to the violation of criminal laws that protect copyrights, patents, trademarks, other forms of intellectual property and trade secrets, both in the United States and abroad. IP crimes can destroy jobs, suppress innovation in the United States and jeopardize the health and safety of consumers. In some cases, these activities are used to fund dangerous or even violent criminal enterprises and organized crime networks.
"As our country continues to recover from once-in-a-generation economic challenges, the need to safeguard intellectual property rights – and to protect Americans from intellectual property crimes – has never been more urgent,” said Attorney General Holder. “Through this new public education campaign, we are encouraging the American people to become vigilant partners in identifying and disrupting intellectual property crimes. With their help, I am confident that we can build upon our recent successes in combating intellectual property theft, bringing criminals to justice and protecting consumers and innovators.”
“Intellectual property theft is not a victimless crime – it affects everyone and damages our economy,” said Assistant Attorney General for the Office of Justice Programs Laurie O. Robinson. “We are proud to work with the White House and NCPC toward reducing the demand for counterfeit products through educating the public about intellectual property crime.”
The campaign includes “Premonition,” a television public service announcement (PSA) created in partnership with MTV Networks that illustrates how IP thefts link to gangs and other criminal activities and “It Hurts,” an online video that demonstrates how IP theft is stealing. The campaign also includes radio and print ads as well as campaign materials delivered via social media tools – videos, podcasts and web banners. The public service announcements and other IP theft public education campaign materials can be found at www.ncpc.org/getreal.
Attorney General Holder and Assistant Attorney General Robinson were joined at today’s campaign launch by Intellectual Property Enforcement Coordinator in the Executive Office of the President Victoria Espinel, Director of Immigration and Customs at the Department of Homeland Security John Morton, Acting Deputy Secretary of Commerce Rebecca M. Blank, and President and CEO of the National Crime Prevention Council Ann M. Harkins.
More information about the Bureau of Justice Assistance and its programs is available at www.bja.gov.
The Office of Justice Programs (OJP), headed by Assistant Attorney General Laurie O. Robinson, provides federal leadership in developing the nation’s capacity to prevent and control crime, administer justice, and assist victims. OJP has six bureaus and offices: the Bureau of Justice Assistance; the Bureau of Justice Statistics; the National Institute of Justice; the Office of Juvenile Justice and Delinquency Prevention; the Office for Victims of Crime; and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering, and Tracking (SMART). More information about OJP and its components can be found at www.ojp.gov .
Monday 28 November 2011
Federal Courts Order Seizure of 150 Website Domains<br /> Involved in Selling Counterfeit Goods as Part of<br /> DOJ, ICE HSI and FBI Cyber Monday CrackdownRead the Press Release
WASHINGTON – Seizure orders have been executed against 150 domain names of commercial websites engaged in the illegal sale and distribution of counterfeit goods and copyrighted works as part of Operation In Our Sites, the Department of Justice, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the ICE-led National Intellectual Property Rights Coordination Center (IPR Center), and the FBI Washington Field Office announced today.
“Through this operation we are aggressively targeting those who are selling counterfeit goods for their own personal gain while costing our economy much-needed revenue and jobs,” said Attorney General Eric Holder. “Intellectual property crimes harm businesses and consumers, alike, threatening economic opportunity and financial stability, and today we have sent a clear message that the Department will remain ever vigilant in protecting the public’s economic welfare and public safety through robust intellectual property enforcement.”
“For most, the holidays represent a season of good will and giving, but for these criminals, it’s the season to lure in unsuspecting holiday shoppers,” said ICE Director John Morton. “More and more Americans are doing their holiday shopping online, and they may not realize that purchasing counterfeit goods results in American jobs lost, American business profits stolen and American consumers receiving substandard products. And the ramifications can be even greater because the illicit profits made from these types of illegal ventures often fuel other kinds of organized crime.”
“The sale of counterfeit goods cheats consumers and robs legitimate businesses – both large and small – of the fruits of their hard-earned work,” said Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division. “We will not tolerate those who seek to profit by abusing the Internet and stealing intellectual property at the expense of authors, artists and inventors. The Department of Justice will continue to work aggressively to combat intellectual property crime.”
“The theft of intellectual property, to include the trafficking of counterfeit goods, creates significant financial losses,” said FBI Section Chief Zack Miller of the Cyber Division. “The FBI aggressively pursues intellectual property enforcement through traditional investigative methods, intelligence initiatives and coordinated efforts with private industry and domestic and foreign law enforcement partners.”
The 150 seized domains are in the custody of the federal government. Visitors to the sites will now find a seizure banner that notifies them that the domain name has been seized by federal authorities and educates them that willful copyright infringement is a federal crime.
During this operation, federal law enforcement agents made undercover purchases of a host of products, including professional sports jerseys, golf equipment, DVD sets, footwear, handbags and sunglasses, representing a variety of trademarks from online retailers who were suspected of selling counterfeit products. In most cases, the goods were shipped directly into the United States from suppliers in other countries. If the trademark holders confirmed that the purchased products were counterfeit or otherwise illegal, seizure orders for the domain names of the websites that sold the goods and associated websites were obtained from federal magistrate judges.
This operation is the eighth phase of Operation In Our Sites, a sustained law enforcement initiative to protect consumers by targeting counterfeit and piracy on the Internet. This is the second year that a phase of Operation In Our Sites has coincided with Cyber Monday. In November 2010, 82 websites were seized during the Cyber Monday-related operation.
Since the operation’s June 2010 launch, the IPR Center has seized a total of 350 domain names, and the seizure banner has received more than 77 million individual views.
Of the 350 domain names seized, 116 have now been forfeited to the U.S. government. The federal forfeiture process affords individuals who have an interest in the seized domain names a period of time after the “Notice of Seizure” to file a petition with a federal court and additional time after the “Notice of Forfeiture” to contest the forfeiture. If no petitions or claims are filed, the domain names become property of the U.S. government.
Additionally, a public service announcement (PSA), launched in April 2011, appears on each of the 116 forfeited domain names. This video educates the public about the economic impact of trademark counterfeiting and copyright infringement.
The operation was spearheaded by the IPR Center in coordination with the FBI’s Washington Field Office, the Computer Crime and Intellectual Property Section of the Justice Department’s Criminal Division and eight U.S. Attorneys’ Offices, including the District of Maryland, Southern District of Texas, Western District of Texas, District of Minnesota, Eastern District of Michigan, Eastern District of Louisiana and District of Colorado.
The IPR Center is one of the U.S. government’s key weapons in the fight against criminal counterfeiting and piracy. 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.
The enforcement actions announced today are one of many efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force). 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/.
Federal Courts Order Seizure of 150 Website Domains<br /> Involved in Selling Counterfeit Goods as Part of<br /> DOJ, ICE HSI and FBI Cyber Monday CrackdownRead the Press Release
WASHINGTON – Seizure orders have been executed against 150 domain names of commercial websites engaged in the illegal sale and distribution of counterfeit goods and copyrighted works as part of Operation In Our Sites, the Department of Justice, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the ICE-led National Intellectual Property Rights Coordination Center (IPR Center), and the FBI Washington Field Office announced today.
“Through this operation we are aggressively targeting those who are selling counterfeit goods for their own personal gain while costing our economy much-needed revenue and jobs,” said Attorney General Eric Holder. “Intellectual property crimes harm businesses and consumers, alike, threatening economic opportunity and financial stability, and today we have sent a clear message that the Department will remain ever vigilant in protecting the public’s economic welfare and public safety through robust intellectual property enforcement.”
“For most, the holidays represent a season of good will and giving, but for these criminals, it’s the season to lure in unsuspecting holiday shoppers,” said ICE Director John Morton. “More and more Americans are doing their holiday shopping online, and they may not realize that purchasing counterfeit goods results in American jobs lost, American business profits stolen and American consumers receiving substandard products. And the ramifications can be even greater because the illicit profits made from these types of illegal ventures often fuel other kinds of organized crime.”
“The sale of counterfeit goods cheats consumers and robs legitimate businesses – both large and small – of the fruits of their hard-earned work,” said Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division. “We will not tolerate those who seek to profit by abusing the Internet and stealing intellectual property at the expense of authors, artists and inventors. The Department of Justice will continue to work aggressively to combat intellectual property crime.”
“The theft of intellectual property, to include the trafficking of counterfeit goods, creates significant financial losses,” said FBI Section Chief Zack Miller of the Cyber Division. “The FBI aggressively pursues intellectual property enforcement through traditional investigative methods, intelligence initiatives and coordinated efforts with private industry and domestic and foreign law enforcement partners.”
The 150 seized domains are in the custody of the federal government. Visitors to the sites will now find a seizure banner that notifies them that the domain name has been seized by federal authorities and educates them that willful copyright infringement is a federal crime.
During this operation, federal law enforcement agents made undercover purchases of a host of products, including professional sports jerseys, golf equipment, DVD sets, footwear, handbags and sunglasses, representing a variety of trademarks from online retailers who were suspected of selling counterfeit products. In most cases, the goods were shipped directly into the United States from suppliers in other countries. If the trademark holders confirmed that the purchased products were counterfeit or otherwise illegal, seizure orders for the domain names of the websites that sold the goods and associated websites were obtained from federal magistrate judges.
This operation is the eighth phase of Operation In Our Sites, a sustained law enforcement initiative to protect consumers by targeting counterfeit and piracy on the Internet. This is the second year that a phase of Operation In Our Sites has coincided with Cyber Monday. In November 2010, 82 websites were seized during the Cyber Monday-related operation.
Since the operation’s June 2010 launch, the IPR Center has seized a total of 350 domain names, and the seizure banner has received more than 77 million individual views.
Of the 350 domain names seized, 116 have now been forfeited to the U.S. government. The federal forfeiture process affords individuals who have an interest in the seized domain names a period of time after the “Notice of Seizure” to file a petition with a federal court and additional time after the “Notice of Forfeiture” to contest the forfeiture. If no petitions or claims are filed, the domain names become property of the U.S. government.
Additionally, a public service announcement (PSA), launched in April 2011, appears on each of the 116 forfeited domain names. This video educates the public about the economic impact of trademark counterfeiting and copyright infringement.
The operation was spearheaded by the IPR Center in coordination with the FBI’s Washington Field Office, the Computer Crime and Intellectual Property Section of the Justice Department’s Criminal Division and eight U.S. Attorneys’ Offices, including the District of Maryland, Southern District of Texas, Western District of Texas, District of Minnesota, Eastern District of Michigan, Eastern District of Louisiana and District of Colorado.
The IPR Center is one of the U.S. government’s key weapons in the fight against criminal counterfeiting and piracy. 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.
The enforcement actions announced today are one of many efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force). 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/.
Daniel M. McDermott to Serve as U.S. Trustee for Iowa, Minnesota, North Dakota, South Dakota for Interim PeriodRead the Press Release
WASHINGTON - Daniel M. McDermott, the U.S. Trustee for Ohio and Michigan (Region 9), has been designated by Attorney General Eric Holder also to serve as the U.S. Trustee for Iowa, Minnesota, North Dakota and South Dakota (Region 12) for an interim period beginning on Dec. 3, 2011, the Executive Office for U.S. Trustees announced today. He replaces Habbo G. Fokkena, who is retiring from the U.S. Trustee Program (USTP) after serving as the U.S. Trustee for Region 12 since May 2002.
Mr. McDermott was appointed as the U.S. Trustee for Region 9 in July 2008, and also served as the U.S. Trustee for Tennessee and Kentucky (Region 8) from January 2011 through July 2011. Previously, he headed the USTP's Cleveland office as Assistant U.S. Trustee, and in 1999 he was recognized with the Director's Award for Management Excellence. Before joining the USTP, Mr. McDermott held positions as a Bankruptcy Administrator for the U.S. Bankruptcy Court for the Northern District of Ohio and as a bank officer and assistant counsel.
Mr. McDermott received his law degree from Cleveland-Marshall College of Law in Cleveland and his undergraduate degree from Villanova University in Villanova, Pa.
The USTP is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. The USTP has 21 regions and 95 field offices. Region 12 is headquartered in Cedar Rapids, Iowa, with additional offices in Des Moines, Iowa; Minneapolis; and Sioux Falls, S.D.
Contact:Jane Limprecht, Public Information Officer
Executive Office for U.S. Trustees
(202) 305-7411
Wednesday 23 November 2011
Seven Ohio Men Arrested for Hate Crime Attacks Against Amish MenRead the Press Release
CLEVELAND – Seven Ohio men were arrested today on charges that they committed and conspired to commit religiously-motivated physical assaults in violation of the Matthew Shepard-James Byrd Hate Crimes Prevention Act. The arrests were announced today by Thomas E. Perez, Assistant Attorney General for the Civil Rights Division and Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
The criminal complaint, filed in Cleveland, charges Samuel Mullet Sr., Johnny S. Mullet, Daniel S. Mullet, Levi F. Miller, Eli M. Miller and Emanuel Schrock, all of Bergholz, Ohio; and Lester S. Mullet, of Hammondsville, Ohio, with willfully causing bodily injury to any person, or attempting to do so by use of a dangerous weapon, because of the actual or perceived religion of that person. The maximum potential penalty for these violations is life in prison.
According to the affidavit filed in support of the arrest warrants, the defendants conspired to carry out a series of assaults against fellow Amish individuals with whom they were having a religiously-based dispute. In doing so, the defendants forcibly restrained multiple Amish men and cut off their beards and head hair with scissors and battery-powered clippers, causing bodily injury to these men while also injuring others who attempted to stop the attacks. In the Amish religion, a man’s beard and head hair are sacred.
This case is being investigated by the Cleveland Division of the FBI and is being prosecuted by Assistant U.S. Attorney Bridget M. Brennan of the U.S. Attorney’s Office for the Northern District of Ohio and Deputy Chief Kristy Parker of the Civil Rights Division’s Criminal Section.
A criminal complaint is merely an accusation. All defendants are presumed innocent of the charges until proven guilty beyond a reasonable doubt in court.
Hungarian Citizen Pleads Guilty to Hacking into Marriott Computers and Extorting Employment from the CompanyRead the Press Release
WASHINGTON – A Hungarian citizen pleaded guilty today to intentionally causing damage by transmitting a malicious code to Marriott International Corporation computers and to threatening to reveal confidential information obtained from the company’s computers if Marriott did not offer him a job.
The guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge David Beach of the U.S. Secret Service, Washington Field Office.
Attila Nemeth, 26, pleaded guilty in the District of Maryland before U.S. District Judge J. Frederick Motz.
According to Nemeth’s plea agreement, on Nov. 11, 2010, Nemeth sent an initial email to Marriott personnel, advising that he had been accessing Marriott’s computers for months and had obtained proprietary information. Nemeth threatened to reveal this information if Marriott did not give him a job maintaining the company’s computers. On Nov. 13, 2010, after receiving no response from Marriott, Nemeth sent another email containing eight attachments, seven of which were confirmed as documents stored on Marriott’s computer system. These documents included financial documentation and other confidential and proprietary information. Nemeth admitted that through an infected email attachment sent to specific Marriott employees he was able to install malicious software on Marriott’s system that gave him a “backdoor” into the system. Using the “backdoor,” Nemeth was able to access proprietary email and other files belonging to Marriott.
According to the plea agreement, on Nov. 18, 2010, Marriott created the identity of a fictitious Marriott employee for the use by the U.S. Secret Service in an undercover operation to communicate with Nemeth. Nemeth, believing he was communicating with Marriott human resources personnel, continued to call and email the undercover agent, and demanded a job with Marriott in order to prevent the public release of the Marriott documents. Nemeth emailed a copy of his Hungarian passport as identification and offered to travel to the United States.
On Jan. 17, 2011, Nemeth arrived at Washington Dulles Airport on a ticket purchased by Marriott, for an “employment interview.” The “interview” was conducted by a Secret Service agent assuming the role of the Marriott employee with whom Nemeth believed he had been communicating. During the course of the “interview,” Nemeth admitted that he accessed Marriott’s computer systems; stole Marriott’s confidential and proprietary information; and initiated the emails to Marriott threatening to publicly release Marriott’s data unless he was given a job on his terms by Marriott. To further prove his identity as the perpetrator, Nemeth demonstrated exactly how he accessed the Marriott network; his continued ability to access the Marriott network; and the location of the stolen Marriott proprietary data on a computer server located in Hungary.
As a result of the compromise of its computer network, Marriott was compelled to engage more than 100 of its employees in a thorough search of its network to determine the scope of the compromise and to identify the data that may have been compromised. The loss to Marriott as a result of the intentional damage caused by Nemeth is between $400,000 and $1 million dollars in salaries, consultant expenses and other costs associated with Nemeth’s intrusion.
Nemeth faces a maximum penalty of 10 years in prison for the transmission of the malicious code and a maximum of five years in prison for threatening to expose confidential and proprietary information if Marriott did not give him a job. Sentencing is scheduled for Feb. 3, 2012, at 11 a.m. Nemeth remains detained.
The case is being investigated by the U.S. Secret Service and prosecuted by Special Assistant U.S. Attorney Anthony V. Teelucksingh assigned from the Computer Crime and Intellectual Property Section of the Justice Department’s Criminal Division.
Fair Housing Lawsuit Filed Against the University of Nebraska at Kearney for Discrimination Against Students with Psychological and Emotional DisabilitiesRead the Press Release
WASHINGTON – The Justice Department today filed a lawsuit against the University of Nebraska at Kearney (UNK), the Board of Regents of the University of Nebraska and employees of UNK for violating the Fair Housing Act by discriminating against students with disabilities.
The lawsuit, filed in the U.S. District Court for Nebraska, charges that UNK and its employees engaged in a pattern or practice of violating the Fair Housing Act or denied rights protected by the act by denying reasonable accommodation requests by students with psychological or emotional disabilities seeking to live with emotional assistance animals in university housing. The suit also charges that UNK requires students with psychological disabilities to disclose sensitive medical and other information that is unnecessary to evaluate their accommodation requests. This lawsuit arose as a result of a complaint filed with the Department of Housing and Urban Development (HUD) by a student enrolled at UNK who sought to live with an emotional assistance dog that had been prescribed.
“The Fair Housing Act requires housing providers to give reasonable accommodations for people with disabilities so that all have equal housing opportunities. The Fair Housing Act also ensures that when people seek an accommodation, they are not required to disclose medical information that is overly intrusive and invasive in order to receive an accommodation,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Justice Department will continue its vigorous enforcement of fair housing laws that protect the rights of people with psychological or emotional disabilities so that they will have full opportunity to find housing as the law requires.”
The lawsuit seeks a court order prohibiting future discrimination by the defendants, monetary damages for those harmed by the defendants’ actions, and a civil penalty. Any individuals who have information relevant to this case are urged to contact the Housing and Civil Enforcement Section of the Civil Rights Division at 1-800-896-7743, ext. 92.
The federal Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability. More information about the Civil Rights Division and the laws it enforces is available at www.usdoj.gov/crt . Individuals who believe that they have been victims of housing discrimination can call the Housing Discrimination Tip Line at 1-800-896-7743, e-mail the Justice Department at [email protected] , or contact HUD at 1-800-669-9777.
The complaint is an allegation of unlawful conduct. The allegations must still be proven in federal court.
California Youth Counselor Pleads Guilty to Producing Child PornographyRead the Press Release
WASHINGTON – A Pleasant Hill, Calif., youth counselor pleaded guilty today in federal court in Oakland, Calif., to producing child pornography, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Melinda Haag of the Northern District of California.
Thomas Perez Jewell, 54, pleaded guilty before U.S. District Judge Phyllis J. Hamilton in the Northern District of California to one count of production of child pornography.
Jewell admitted to sexually molesting two minor victims and to producing child pornography of the molestation. According to court documents, Jewell was employed as a youth counselor and therapist. Jewell’s molestation offenses were discovered when law enforcement executed a search warrant on his residence for suspected possession of child pornography.
Jewell has been in custody since his arrest on Nov. 18, 2011. He is scheduled to be sentenced on Feb. 29, 2012, before Judge Hamilton in Oakland. At sentencing, Jewell will face a minimum mandatory sentence of 15 years in prison and a maximum sentence of 30 years in prison, a fine of up to $250,000 and a maximum term of life on supervised release. Jewell will be required to register as a sex offender in accordance with state and federal law.
The case is being prosecuted by Assistant U.S. Attorney Joshua Hill and Trial Attorney Mi Yung Park of the Child Exploitation and Obscenity Section (CEOS) in the Justice Department’s Criminal Division. This case was investigated by the FBI; the Pleasant Hill Police Department; the Martinez, Calif., Police Department; and the Walnut Creek, Calif., Police Departments.
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 .
Tuesday 22 November 2011
United States Files Complaint Against BestCare Laboratory Services Alleging False Claims for Medicare FundsRead the Press Release
WASHINGTON – The United States filed a complaint against BestCare Laboratories, Inc. and its founder and principal, Karim A. Maghareh, in the U.S. District Court for the Southern District of Texas, the Justice Department announced today. The suit alleges that the defendants knowingly misrepresented the distances traveled by its lab technicians to artificially increase reimbursement from Medicare for mileage-based technician travel allowance fees.
According to the complaint, BestCare transported laboratory test specimens as air cargo from nursing home customers located in the Austin, Dallas/Ft. Worth, El Paso, San Antonio and Waco areas to BestCare’s laboratory close to Houston, but claimed mileage for ground travel as though its technicians personally drove the specimens one-way or round-trip between those cities and its lab in Houston. The complaint also alleges that Mr. Maghareh supervised BestCare’s day-to-day operations and directed or authorized the false billing. BestCare is a clinical laboratory founded in 2002.”
“There’s no question that health care providers are entitled to recover their reasonable costs for services they actually deliver, but we have zero patience for those who invent or inflate Medicare reimbursement claims,” said Assistant Attorney General for the Civil Division Tony West. “As today demonstrates, the Justice Department will vigorously enforce the False Claims Act to protect our seniors and safeguard the Medicare trust fund.”
“Our office is dedicated to recovering tax payer dollars misappropriated from Medicare,” said Kenneth Magidson, U.S. Attorney for the Southern District of Texas. “We are committed to aggressively litigating civil suits against dishonest providers to protect the seniors who depend on Medicare.”
The original lawsuit was filed by Richard Drummond under the qui tam, or whistleblower, provisions of the False Claims Act. The qui tam provisions allow private parties, called “relators,” to sue on behalf of the United States persons or companies they believe have knowingly submitted false claims for government funds. Relators are entitled to receive 15 to 25 percent of any recovery if the United States intervenes in the suit, as it has here, or 25 to 30 percent if the United States declines intervention. Defendants who violate the False Claims Act are liable for three times the government’s damages plus civil penalties.
This action is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover nearly $6.5 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are more than $8.5 billion.
U.S. Pharmaceutical Company Merck Sharp & Dohme to Pay Nearly One Billion Dollars over Promotion of Vioxx®Read the Press Release
WASHINGTON – American pharmaceutical company Merck, Sharp & Dohme has agreed to pay $950 million to resolve criminal charges and civil claims related to its promotion and marketing of the painkiller Vioxx® (rofecoxib), the Justice Department announced today. Under the terms of the resolution, Merck will plead guilty to a one-count information charging a single violation of the Food Drug and Cosmetic Act (FDCA) for introducing a misbranded drug, Vioxx®, into interstate commerce. Under the terms of its plea agreement with the United States, Merck will plead guilty to a misdemeanor for its illegal promotional activity and will pay a $321,636,000 criminal fine.
Merck is also entering into a civil settlement agreement under which it will pay $628,364,000 to resolve additional allegations regarding off-label marketing of Vioxx® and false statements about the drug’s cardiovascular safety. Of the total civil settlement, $426,389,000 will be recovered by the United States, and the remaining share of $201,975,000 will be distributed to the participating Medicaid states. The settlement and plea conclude a long-running investigation of Merck’s promotion of Vioxx®, which was withdrawn from the marketplace in September 2004.
Merck’s criminal plea relates to misbranding of Vioxx® by promoting the drug for treating rheumatoid arthritis, before that use was approved by the Food and Drug Administration (FDA). Under the provisions of the FDCA, a company is required to specify the intended uses of a product in its new drug application to FDA. Once approved, the drug may not be marketed or promoted for so-called “off-label” uses – any use not specified in an application and approved by FDA – unless the company applies to the FDA for approval of the additional use. The FDA approved Vioxx® for three indications in May 1999, but did not approve its use against rheumatoid arthritis until April 2002. In the interim, for nearly three years, Merck promoted Vioxx® for rheumatoid arthritis, conduct for which it was admonished in an FDA warning letter issued in September 2001.
The parallel civil settlement covers a broader range of allegedly illegal conduct by Merck. The settlement resolves allegations that Merck representatives made inaccurate, unsupported, or misleading statements about Vioxx’s cardiovascular safety in order to increase sales of the drug, resulting in payments by the federal government. It also resolves allegations that Merck made false statements to state Medicaid agencies about the cardiovascular safety of Vioxx, and that those agencies relied on Merck’s false claims in making payment decisions about the drug. Finally, like the criminal plea, the civil settlement also recovers damages for allegedly false claims caused by Merck’s unlawful promotion of Vioxx for rheumatoid arthritis.
“When a pharmaceutical company ignores FDA rules aimed at keeping our medicines safe and effective, that company undermines the ability of health care providers to make the best medical decisions on behalf of their patients,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “As this plea agreement and civil settlement make clear, we will not hesitate to pursue those who skirt the proper drug approval process and make misleading statements about the safety and efficacy of their products.”
“Today’s resolution appropriately reflects the severity of Merck’s conduct; it is yet another reminder that the United States will not tolerate misconduct by drug companies that bends the rules and puts patient safety at risk,” announced Carmen M. Ortiz, U.S. Attorney for the District of Massachusetts. “Any marketing activity that ignores the importance of FDA approval, or that makes unsupported safety claims about a drug is unacceptable, and will be pursued vigorously in both the criminal and civil arena.”
As part of the settlement, Merck has also agreed to enter into an expansive corporate
integrity agreement with the Office of Inspector General of the Department of Health and
Human Services (HHS-OIG), which will strengthen the system of reviews and oversight procedures imposed on the company. Although Vioxx is no longer on the market, this ongoing monitoring of Merck’s conduct is aimed to deter and detect similar conduct in the future.
“We will continue to work with our law enforcement partners to aggressively investigate and prosecute pharmaceutical companies – no matter how large – when they improperly market their products,” said Daniel R. Levinson, Inspector General of the United States Department of Health and Human Services. “Merck’s comprehensive corporate integrity agreement requires top company officials to complete annual compliance certifications, and obligates Merck to post information about physician payments on its website.”
This case was handled by the Justice Department’s Civil Division and the U.S. Attorney’s Office for the District of Massachusetts. The investigation was conducted by HHS-OIG, the FBI, the Office of Criminal Investigations for the FDA, the Veterans Administration’s Office of Criminal Investigations, the Office of the Inspector General for the Office of Personnel Management, the National Association of Medicaid Fraud Control Units, and the offices of various state attorneys general.
U.S. Files Suit Against California Company for Allegedly Violating the Telemarketing Sales RuleRead the Press Release
WASHINGTON - The United States has filed suit against Sonkei Communications Inc., and its principal corporate officers, Peter Turpel and Joseph Turpel, the Justice Department announced today. The government’s complaint, filed in U.S. District Court for the Central District of California, alleges that the defendants violated the Federal Trade Commission’s (FTC) Telemarketing Sales Rule (TSR) through their telemarketing service, which facilitates delivery of robocalls by telemarketers claiming to offer products and services to consumers throughout the United States, including home security systems, grant procurement programs, and credit card services. Sonkei is based in Newbury Park, Calif.
The TSR established the National Do Not Call Registry for consumers who do not wish to receive certain telemarketing calls, and generally prohibits calling these consumers. The TSR also prohibits “robocalls,” that is, telephone calls that deliver a prerecorded message if the seller has not first obtained the recipient’s consent to receive these calls.
The government’s complaint alleges that the defendants assisted and facilitated abusive practices by their telemarketing customers, including calling telephone numbers registered on the National Do Not Call Registry and placing unauthorized robocalls to consumers, in violation of the Telemarketing Sales Rule.
In addition, the complaint alleges that the illegal calls allegedly placed by the defendants’ customers have generated tens of thousands of complaints from consumers and businesses. In its lawsuit, the government asks the court to impose civil penalties for the defendants’ conduct and to enjoin them from further TSR violations. The complaint, which the Justice Department filed with the assistance of the FTC, is based on the FTC’s investigation of the defendants’ telemarketing service.
“The Telemarketing Sales Rule, including the Do Not Call Registry, aims to shield consumers from a barrage of sales calls they don’t want which push products they don’t need,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “We will work with the FTC to identify and penalize those who violate the rule and can’t take ‘no’ for an answer.”
Individuals who believe they have received calls in violation of the TSR should register their complaints with the FTC. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant (www.ftccomplaintassistant.gov/) or call 1-877-FTC-HELP (1-877-382-4357). This case is being prosecuted by Department of Justice, Civil Division, Consumer Protection Branch attorneys Sondra Mills and Matthew Ebert.
Justice Department Signs Agreement with Upshur County, Texas, to Ensure Civic Access for Persons with DisabilitiesRead the Press Release
WASHINGTON – The Justice Department today announced an agreement with Upshur County, Texas, to improve access to all aspects of civic life for people with disabilities. The agreement was reached under Project Civic Access (PCA), the department’s wide-ranging initiative to ensure that cities, towns and counties throughout the country comply with the Americans with Disabilities Act (ADA).
“Access to civic life is a fundamental part of American society, and people with disabilities must have the opportunity to participate in local government programs, services and activities on an equal basis with their neighbors,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division . “Upshur County has made an important commitment to achieving ADA compliance, and this agreement serves as a roadmap to that important end. I commend Upshur County officials for working with the Justice Department to provide equal access to all of its programs, services, and activities.”
“The ability of all citizens to enter a courthouse or a polling place to vote is central to our democracy,” said John M. Bales, U.S. Attorney for the Eastern District of Texas. “Our office, in conjunction with the Civil Rights Division, will continue to work with Upshur County and other counties to make all public facilities in the Eastern District fully accessible.”
As part of the PCA initiative, Justice Department investigators, attorneys and architects survey state and local government facilities, services and programs in communities across the country to identify the modifications needed for compliance with ADA requirements. Based on these surveys, agreements are tailored to address the steps each community must take to improve access. This agreement is the 196th under the PCA initiative.
Under the agreement announced today, Upshur County will take important steps to improve access to county programs for individuals with disabilities, such as:
- Making physical modifications to its facilities so that parking, routes into the buildings, entrances, public telephones, restrooms, service counters and drinking fountains are accessible to persons with disabilities.
- Posting, publishing and distributing a notice to inform members of the public about Title II of the ADA and how it applies to the county’s programs, services and activities.
- Implementing and reporting to the Department of Justice the county’s written procedures for providing information about the county’s accessible programs, services and activities and their locations.
- Appointing an ADA Coordinator and adopting a grievance procedure to handle grievances submitted under the ADA.
- Implementing effective communication policies approved by the Department of Justice to ensure people with disabilities have access to county programs and services, including county law enforcement agencies.
- Developing policies and procedures and planning to ensure that people with disabilities are afforded equal, integrated access to emergency management programs, including emergency preparedness, notification, evacuation, sheltering, response, clean up and recovery.
- Implementing a plan to ensure the accessibility of sidewalks, transportation stops and pedestrian crossings by installing accessible curb ramps throughout the county.
- Establishing and implementing a policy to ensure that county web pages are accessible to people with disabilities.
Today’s agreement was reached under Title II of the ADA, which prohibits discrimination against people with disabilities by state and local governments. The agreement will remain in effect for three years from Nov. 22, 2011, or until all actions required by the agreement have been completed, whichever is later. The department will actively monitor compliance with the agreement until all required actions have been completed.
For more information on today’s agreement, the PCA initiative, or the ADA Best Practices Tool Kit for State and Local Governments, please visit the ADA website at www.ada.gov or call the toll-free ADA Information Line at 800-514-0301 or 800-514-0383 (TTY). People interested in finding out more about today’s agreement with Upshur County, please visit www.ada.gov/upshur_co_tx_pca/upshur_co_tx_sa.htm.
Indiana Man Sentenced to 315 Years in Prison for Producing and Trafficking Child PornographyRead the Press Release
WASHINGTON – A Bloomington, Ind., man was sentenced today in the Southern District of Indiana to 315 years in prison for multiple charges relating to his production and trafficking of child pornography, 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.
David R. Bostic, 25, was sentenced by U.S. District Judge Jane E. Magnus-Stinson. In addition to Bostic’s prison term, Judge Magnus-Stinson also sentenced Bostic to lifetime supervised release.
“Mr. Bostic committed heinous acts of sexual abuse against the most vulnerable in our society,” said Assistant Attorney General Breuer. “He memorialized these unspeakable crimes by producing photographs of his abuse and distributing them to an international network of child predators. No prison term can undo the pain and suffering Mr. Bostic has caused. But today’s sentence sends a strong message that child sexual exploitation will be punished severely.”
“This defendant is among the most dangerous offenders ever prosecuted by this office,” said U.S. Attorney Hogsett. “My heart goes out to the many victims in this case, but we can say today that thanks to the efforts of prosecutors and our law enforcement partners, this man will never again be able to prey on the most innocent among us.”
“This case is considered one of the most significant child pornography matters ever investigated by the FBI,” said Deputy Assistant Director Michael S. Welch of the FBI’s Cyber Division. “This case resulted in the identification and rescue of approximately two dozen children from inside and outside the United States.”
Bostic pleaded guilty on June 6, 2011, to producing child pornography images of five children, all four years of age and younger, including one child who was only two months old. Bostic distributed some of these images to several individuals around the world in exchange for other child pornography, some of which was material produced by those trading partners.
Bostic also pleaded guilty for his role in an international conspiracy to traffic in child pornography primarily involving images of minors under five years of age. Bostic initially gained the trust of the principal administrator of that group by providing the child pornography images he produced.
This case was the result of the significant efforts of the FBI, with assistance from the Indiana State Police; the Kokomo, Ind., Police Department; and the Brownsburg, Ind., Police Department.
The case was prosecuted by Assistant U.S. Attorney A. Brant Cook of the Southern District of Indiana and Trial Attorney Michael Grant of the Child Exploitation and Obscenity Section in the Justice Department’s Criminal Division.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and 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.
Fair Housing Lawsuit Filed Against California Municipality for Discriminating Against Families with ChildrenRead the Press Release
WASHINGTON – The Justice Department filed a lawsuit yesterday against a California municipality and a homeowners’ association for discriminating against families with children in violation of the Fair Housing Act.
The lawsuit, filed in the U.S. District Court for the Northern District of California, alleges that the city of Santa Rosa, a California municipality, and La Esplanada Unit 1 Owners’ Association, a homeowners’ association, sought to restrict residency at a condominium complex to seniors aged 55 and older. While the law allows such an exemption, the suit alleges that neither the city nor the homeowners’ association took the necessary steps, such as routine age-verification procedures, to qualify for the exemption in a way that was consistent with the Fair Housing Act. Consequently, their actions unlawfully denied and made housing unavailable to families with children. The lawsuit seeks a court order prohibiting future discrimination by the defendants, monetary damages for those harmed by the defendants’ actions and a civil penalty.
“It is critical that families with children have opportunities to find housing. A housing developer or a municipality cannot deny housing to families with children and restrict its housing to seniors 55 years and older unless they comply with the requirements set forth in the Fair Housing Act,” said Thomas E. Perez, Assistant Attorney General for the Justice Department’s Civil Rights Division. “The Justice Department will continue to vigorously enforce fair housing laws that protect the rights of families with children.”
This lawsuit arose as a result of a complaint filed with the Department of Housing and Urban Development (HUD) by the owner and representative of a portion of the condominium development that was the subject of the defendants’ enforcement actions. After HUD investigated the complaint, it issued a charge of discrimination and the matter was referred to the Justice Department.
“When Congress made it illegal to discriminate against families with children in housing, it carved out an exemption for senior communities, setting clear standards those communities must meet if they wish to exclude families with children,” said John Trasviña, HUD Assistant Secretary for Fair Housing and Equal Opportunity. “HUD and the Department of Justice remain committed to ensuring that no community unlawfully denies families with children much-needed housing opportunities.”
The federal Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability. More information about the Civil Rights Division and the laws it enforces is available at www.usdoj.gov/crt . Individuals who believe that they have been victims of housing discrimination can call the Housing Discrimination Tip Line at 1-800-896-7743, e-mail the Justice Department at [email protected] , or contact HUD at 1-800-669-9777.
The complaint is an allegation of unlawful conduct. The allegations must still be proven in federal court.
Detroit-Area Foot Doctor Pleads Guilty to Medicare Fraud SchemeRead the Press Release
WASHINGTON – A Detroit-area foot doctor pleaded guilty today for his participation in a Medicare fraud scheme, announced the Department of Justice, FBI and the Department of Health and Human Services (HHS).
Errol Sherman pleaded guilty before U.S. District Judge Gerald E. Rosen in the Eastern District of Michigan to one count of health care fraud. At sentencing, Sherman faces a maximum penalty of 10 years in prison and a $250,000 fine.
According to the plea documents, Sherman is a Doctor of Podiatric Medicine licensed in the State of Michigan. Between January 2003 and December 2006, Sherman billed Medicare and Blue Cross Blue Shield of Michigan for a procedure known as an “avulsion of the nail plate” or “nail avulsion” procedure. Sherman billed for this procedure thousands of times with respect to hundreds of beneficiaries during that time period. According to court documents, Medicare was billed by Sherman for nail avulsion procedures that were never rendered.
Today’s guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Andrew G. Arena of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (OIG) Chicago Regional Office.
This case was prosecuted by Trial Attorney Catherine K. Dick of the Criminal Division’s Fraud Section and Assistant U.S. Attorney John K. Neal of the Eastern District of Michigan. The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since their inception in March 2007, the Medicare Fraud Strike Force operations in nine districts have charged more than 1,140 individuals who collectively have falsely 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, is taking steps to increase accountability and decrease the presence of fraudulent providers.
Department of Justice Challenges Utah’s Immigration LawRead the Press Release
WASHINGTON – The Department of Justice today challenged Utah’s immigration law, which comes after recent lawsuits in Arizona, Alabama and South Carolina.
In a complaint, filed in the District of Utah, the department states that several provisions of Utah’s H.B. 497 are preempted by federal law. The provisions were enacted on March, 15, 2011.
The department’s lawsuit comes after several months of constructive discussions with Utah state officials. Notwithstanding today’s lawsuit, department officials expect this important dialogue to continue.
The department’s complaint states that H.B. 497 clearly violates the Constitution because it attempts to establish state-specific immigration policy. The law creates and mandates immigration enforcement measures that interfere with the immigration priorities and practices of the federal government in a way which is not cooperative with the primary federal role in this area. The law’s mandates on law enforcement could lead to harassment and detention of foreign visitors and legal immigrants who are in the process of having their immigration status reviewed in federal proceedings and whom the federal government has permitted to stay in this country while such proceedings are pending.
The federal government has the ultimate authority to enforce federal immigration laws and the Constitution does not permit a patchwork of local immigration policies. A state setting its own immigration policy interferes with the federal government’s enforcement efforts.
“A patchwork of immigration laws is not the answer and will only create further problems in our immigration system,” said Attorney General Eric Holder. “The federal government is the chief enforcer of immigration laws and while we appreciate cooperation from states, which remains important, it is clearly unconstitutional for a state to set its own immigration policy. We will continue to monitor and coordinate with our federal partners as we remain concerned about the potential impact of these state laws.”
“This kind of legislation diverts critical law enforcement resources from the most serious threats to public safety and undermines the vital trust between local jurisdictions and the communities they serve,” said Department of Homeland Security Secretary Janet Napolitano. “The Department will continue to enforce federal immigration laws in Utah in smart, effective ways that focus our resources on criminal aliens, recent border crossers, repeat and egregious immigration law violators and employers who knowingly hire illegal labor.”
The department notified Utah state officials of its position that the Utah’s Immigrant Guest Worker statutes, H.B. 116 and H.B. 469, are clearly preempted by federal law. Given that the provisions do not take effect until 2013, and in light of the constructive conversations the department continues to have with Utah officials about these provisions pursuant to the Justice Department’s long-standing policy of exploring resolution short of litigation before filing suit against a state, the department is not challenging these provisions today. If, however, Utah fails to comply with federal law in this area, the department will not hesitate to take the legal action necessary to vindicate the important federal interests in this matter before these laws go into effect.
The suit was filed on behalf of the Departments of Justice, Homeland Security and State, which share responsibilities in administering federal immigration law. The department will soon request a preliminary injunction to enjoin enforcement of the certain provisions of H.B. 497.
The Justice Department previously challenged S.B. 1070, H.B. 56, and Act No. 69 on federal preemption grounds in Arizona, Alabama and South Carolina, respectively. The department continues to review immigration-related laws that were passed in Indiana and Georgia. Courts have enjoined key parts of the Arizona, Alabama, Georgia and Indiana state laws and temporarily restrained enforcement of Utah’s law.
Civil Contempt Sanctions Assessed Against Arizona Company That Allegedly Targeted Fraud VictimsRead the Press Release
WASHINGTON – A federal judge in Arizona has held Mesa, Ariz.-based Business Recovery Services (BRS) and its owner, Brian Hessler, in civil contempt of court for violating the terms of a preliminary injunction, the Department of Justice announced today. BRS sells kits that the company purports help individuals who purchased so-called “ill-fated” business opportunities recover their money. The injunction required the defendants to stop charging consumers for recovery goods and services without waiting until seven business days after the customer successfully recovered money lost in a previous transaction.
U.S. District Court Judge James A. Teiborg found that the defendants, and their affiliate, Home-Based Business Consulting LLC, violated the preliminary injunction. The court ordered BRS and Hessler to refund money paid by consumers who were shown to have been sold recovery kits in violation of the order, ordered defendants to pay the government’s attorneys’ fees, and gave the defendants 30 days to change their business practices to follow the preliminary injunction before fines and coercive sanctions would be assessed.
“This is a case of adding insult to injury,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “These defendants preyed on consumers who had already lost money in scams and collected fees regardless of whether they were successful in getting back a single dime for these victims.”
The action was filed by the Justice Department’s Consumer Protection Branch on March 1, 2011, at the request of the Federal Trade Commission (FTC). In its complaint, the government alleged that BRS and Hessler telemarketed products and services they claimed would help consumers recover money they had lost to business opportunity and work-at-home operations, and sold hundreds of variations of do-it-yourself kits tailored to particular schemes and priced up to $499. The complaint asserted that the defendants violated the Telemarketing Sales Rule by misrepresenting the nature and effectiveness of their services, and by accepting payments from consumers for recovery goods and services without waiting until seven business days after the consumers received recovered money, as required by the Telemarketing Sales Rule.
At the time the suit was filed, the Department of Justice sought, and the court issued, a preliminary injunction requiring the defendants to stop charging customers for recovery goods and services in violation of the Telemarketing Sales Rule. At the hearing on the preliminary injunction, the United States established that the defendants collected money from their customers immediately upon sale of the recovery kits, without regard to when or whether the customer ever recovered any funds lost earlier. The court later held the defendants in contempt for continuing their practices in violation of the preliminary injunction.
Consumers who have been victims of telemarketing fraud should attempt to get their money back, and alert law enforcement about the violation. Steps to take that may be helpful include the following:
- Write your credit card company and dispute the amount paid that was based on fraud, if you paid with a credit card, whether or not you already paid the bill;
- Write a letter to your state’s attorney general and to your local Better Business Bureau complaining about the scam, and send a copy to the person who obtained your money;
- Write a letter or complain online to the Consumer Financial Protection Bureau, which supervises banks, credit unions, and other financial companies. Complaints may be filed online at: https://help.consumerfinance.gov/app/ask_cc_complaint ;
- File a complaint with the FTC. This can be done online at: www.ftccomplaintassistant.gov/ .
Assistant Attorney General West thanked the FTC for their assistance with this litigation. The case was prosecuted by Trial Attorney Jessica Gunder of the Consumer Protection Branch of the Civil Division of the Department of Justice.
Monday 21 November 2011
Statement of U.S. Attorney General Holder on the Passing of Former U.S. Deputy Assistant Attorney General for the Criminal Division Jack KeeneyRead the Press Release
Attorney General Eric Holder released the following statement today on the passing of former Deputy Assistant Attorney General for the Criminal Division Jack Keeney:
“For the last six decades, Jack Keeney served the Department of Justice with dedication, integrity and an unshakeable commitment to the rule of law. As the longest-serving federal prosecutor in the history of the United States, the contributions that he made – to the Justice Department and to the nation he was so proud to serve – are beyond measure. And I am one of many who have been grateful to count him as a mentor, advisor and friend.
“Although Mr. Keeney will be sorely missed, his legacy will live on – in the Justice Department building that bears his name, in the standard of excellence that he established in the department’s Criminal Division, in the work of countless attorneys that he mentored throughout his career, and in the inspiration that he will continue to provide public servants across our nation.”
President Barack Obama Grants Pardons and CommutationRead the Press Release
WASHINGTON – Today President Barack Obama granted pardons to five individuals and commutation of sentence to one individual:
PARDONS:
· Lesley Claywood Berry Jr. - Loretto, Ky.
Offense : Conspiracy to manufacture, possess with intent to distribute, and distribute marijuana, 21 U.S.C. §§ 841 and 846.
Sentence : April 29, 1988; District of Minnesota; three years in prison.
· Dennis George Bulin - Wesley Chapel, Fla.
Offense : Conspiracy to possess with intent to distribute in excess of 1,000 pounds of marijuana, 21 U.S.C. §§ 841(a)(1) and 846 and 18 U.S.C. § 2.
Sentence : March 10, 1987; Middle District of Alabama; five years of probation and $20,000 fine.
· Ricky Dale Collett - Annville, Ky.
Offense : Aiding and abetting in the manufacture of 61 marijuana plants, 21 U.S.C. § 841(a)(1) and 18 U.S.C. § 2.
Sentence : March 7, 2002; Eastern District of Kentucky; one year of probation conditioned on 60 days of home detention.
· Martin Kaprelian - Park Ridge, Ill.
Offense : Conspiracy to transport stolen property in interstate commerce, 18 U.S.C. § 371; transporting stolen property in interstate commerce, 18 U.S.C. § 2314; concealing stolen property that was transported in interstate commerce, 18 U.S.C. § 2315.
Sentence : Feb. 1, 1984; Northern District of Illinois; nine years in prison, five years of probation.
· Thomas Paul Ledford - Jonesborough, Tenn.
Offense : Conducting and directing an illegal gambling business, 18 U.S.C. § 1955.
Sentence : June 12, 1995; Eastern District of Tennessee; one year of probation conditioned on performance of 100 hours of community service.
COMMUTATION:
· Eugenia Marie Jennings - Alton, Ill.
Offense : Distribution of cocaine base, 21 U.S.C. § 841(a)(1).
Sentence : Feb. 23, 2001; Southern District of Illinois; 262 months in prison, eight years of supervised release, $1,750 fine.
Terms of commutation : Prison sentence to expire on Dec. 21, 2011, leaving intact and in effect the eight-year term of supervised release with all its conditions and all other components of the sentence.
New Jersey Man Pleads Guilty in $670 Million Fraud SchemeRead the Press Release
WASHINGTON – A certified public accountant (CPA) and purported outside auditor for Provident Capital Indemnity Ltd. (PCI) pleaded guilty today for his role in a $670 million fraud scheme involving victims throughout the United States and abroad.
The guilty plea was announced today by U.S. Attorney for the Eastern District of Virginia Neil H. MacBride and Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.
“Mr. Castillo used his position as a CPA to give PCI an air of legitimacy that provided their clients the peace of mind to invest millions,” said U.S. Attorney MacBride. “Auditors stand as a gatekeeper to fraud, and we are aggressively pursuing those who abuse their position to facilitate the fraud rather than take steps to put a stop to it. I want to commend the outstanding work of the Virginia Securities and Financial Fraud Task Force for detecting and disrupting this massive, ongoing international fraud before the scheme victimized even more investors.”
“Mr. Castillo played an integral role in a multi-million dollar fraud scheme that harmed investors throughout the United States and abroad,” said Assistant Attorney General Breuer. “Trading on his qualification as a CPA, he created false documents that concealed the true nature of PCI’s operations. We are determined to continue holding accountable those who commit financial fraud, and prey upon unsuspecting investors.”
Jorge Luis Castillo, 56, a resident of New Jersey, pleaded guilty before U.S. District Judge John A. Gibney in the Eastern District of Virginia to conspiring to commit mail and wire fraud, which carries a maximum penalty of 20 years in prison. Castillo is scheduled to be sentenced on May 22, 2012.
According to a statement of facts filed with Castillo’s plea agreement, PCI was an insurance and reinsurance company registered in the Commonwealth of Dominica and doing business in Costa Rica. PCI sold financial guarantee bonds to companies selling life settlements, or securities backed by life settlements, to investors. These bonds were marketed to PCI’s clients as a way to alleviate the risk of insured beneficiaries living beyond their life expectancy. The clients, in turn, typically explained to their investors that the financial guarantee bonds ensured that the investors would receive their expected return on investment irrespective of whether the insured on the underlying life settlement lived beyond his or her life expectancy.
Castillo admitted today that he conspired with Minor Vargas Calvo, 60, the president and majority owner of PCI, to prepare audited financial statements that falsely claimed that PCI had entered into reinsurance contracts with major reinsurance companies. These claims, which were supported by a letter from Castillo stating that he conducted an audit of PCI’s financial records, were used to assure PCI’s clients that the reinsurance companies were backstopping the majority of the risk that PCI had insured through its financial guarantee bonds.
Castillo admitted that he never performed an audit of PCI’s financial statements and that, in fact, he personally created the statements he claimed to be independently auditing. He also admitted that he and others at PCI knew that the company never actually entered into reinsurance contracts with any major companies. Castillo also admitted that he and other conspirators provided the false financial statements and fraudulent independent auditors’ report to Dun & Bradstreet (D&B), which D&B relied on in compiling its commercial reports on PCI and issuing its 5A rating of PCI’s financial strength.
From 2004 through 2010, PCI sold approximately $670 million of bonds to life settlement investment companies located in various countries, including the United States, the Netherlands, Germany and Canada. PCI’s clients, in turn, sold investment offerings backed by PCI’s bonds to thousands of investors around the world. Purchasers of PCI’s bonds were allegedly required to make up-front payments of six to 11 percent of the underlying settlement as “premium” payments to PCI before the company would issue the bonds.
Court records state that Castillo received approximately $84,000 from his work as the purported outside auditor of PCI from 2004 through 2010.
Vargas, a citizen and resident of Costa Rica, and PCI were charged in a superseding indictment on Oct. 5, 2011, with one count of conspiracy to commit mail and wire fraud, three counts of mail fraud and three counts of wire fraud. Vargas was also charged with three counts of money laundering. Vargas was arrested on Jan. 19, 2011, at the John F. Kennedy International Airport in New York, and has been incarcerated pending trial, scheduled to be held on Feb. 13, 2012. An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless and until convicted.
This continuing investigation is being conducted by the U.S. Postal Inspection Service, Internal Revenue Service and FBI, with assistance from the Virginia State Corporation Commission, the Texas State Securities Board and the New Jersey Bureau of Securities. This case is being prosecuted by Assistant U.S. Attorneys Michael S. Dry and Jessica Aber Brumberg of the Eastern District of Virginia and Trial Attorney Albert B. Stieglitz Jr. of the Fraud Section in the Justice Department’s Criminal Division.
The U.S. Securities and Exchange Commission (SEC) conducted a parallel investigation and in January 2011 filed a parallel civil enforcement action against PCI, Vargas and Castillo. The department thanks the SEC for its assistance in this matter.
The investigation has been coordinated by the Virginia Financial and Securities Fraud Task Force, an unprecedented partnership between criminal investigators and civil regulators to investigate and prosecute complex financial fraud cases in the nation and in Virginia specifically. The task force is an investigative arm of the President’s Financial Fraud Enforcement Task Force, an interagency national task force.
President Obama established the 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.
Justice Department Settles Housing Discrimination Lawsuit in Rolla, MissouriRead the Press Release
WASHINGTON -The Justice Department today announced that Roger Harris, Hediger Enterprises Inc., Carroll Management Group, Forum Manor Associates L.P. and Forum Manor LLC have agreed to pay $295,000 in monetary damages and civil penalties to resolve a Fair Housing Act lawsuit alleging sexual harassment, race and sex discrimination, retaliation and intimidation at Forum Manor Apartments, a federally-subsidized apartment complex in Rolla, Missouri.
The lawsuit, filed late on Friday, alleges that Mr. Harris, the former manager of Forum Manor, engaged in a pattern or practice of sexual harassment, race and sex discrimination, and retaliation, intimidation or coercion against current and prospective tenants. The lawsuit further alleges that Hediger Enterprises Inc., Carroll Management Group, Forum Manor Associates L.P. and Forum Manor LLC, which owned and managed the property, are liable for Mr. Harris’ actions.
The consent decree, once approved by the court, requires the defendants to pay $260,000 to thirteen victims and $35,000 to the United States as a civil penalty. The consent decree also prohibits all of the defendants from engaging in discrimination, and it requires that the corporate defendants create non-discrimination policies for its properties and participate in fair housing training to prevent such conduct in the future. It also prevents Mr. Harris from managing federally-subsidized properties in the future and limits his ability to manage other types of rental properties.
“No one should have to endure harassment, intimidation or discrimination in order to have housing for their family. It is illegal and a clear abuse of trust for managers and owners of federally-subsidized properties, whose job it is to provide safe and affordable housing to those in need, to engage in or condone harassment, intimidation and discrimination against tenants and applicants,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “This settlement sends the message that the Justice Department will not tolerate this conduct and will take aggressive action against those who participate in it.”
“The Fair Housing Act protects individuals from harassment and discrimination in housing based on race and gender, and shields them from retaliation when they come forward to report it,” said John Trasviña, Assistant Secretary for Fair Housing and Equal Opportunity. “HUD and the Department of Justice will continue to vigorously protect the rights of all people to live in their homes, free from discrimination.”
This lawsuit arose out of complaints filed with the U.S. Department of Housing and Urban Development (HUD) by several former tenants and applicants of Forum Manor. After investigating the complaints, HUD issued a charge of discrimination and referred the case to the Department of Justice after one of the complainants elected to have the case heard in federal court.
Fighting illegal housing discrimination is a top priority of the Department of Justice. The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. Individuals who believe that they may have been victims of housing discrimination can call the Housing Discrimination Tip Line at 1-800-896-7743, e-mail the Justice Department at [email protected], or contact HUD at 1-800-669-9777.
Friday 18 November 2011
Second Conviction for Prince George’s, Maryland, County Tax DefierRead the Press Release
WASHINGTON – Andrew Isaac Chance of Clinton, Md., was convicted of filing a false retaliatory lien against a federal prosecutor and for filing three false claims for income tax refunds, the Justice Department, Internal Revenue Service (IRS) and Treasury Inspector General for Tax Administration (TIGTA) announced today. U.S. District Judge for the District of Maryland Alexander Williams Jr. presided over the federal jury trial in Greenbelt, Md.
According to testimony and evidence presented at trial, Chance was convicted in 2007 for filing a false claim for an income tax refund for the tax year 2005. Shortly after he was released from prison for that crime, he filed a UCC Financing Statement with the Maryland Department of Assessments and Taxation, falsely claiming that the federal prosecutor, who prosecuted the 2007 case, owed him $1.313 billion. The evidence showed that Chance filed a similar lien against a Maryland state prosecutor for her role in prosecuting him for crimes relating to his attempts to cash the fraudulently obtained U.S. Treasury check for the 2005 tax return. According to the evidence, Chance admitted to a federal agent, when arrested in December 2010 in relation to the current indictment, that he had filed the liens because the prosecutors had “done him wrong.”
The evidence at trial established that a year after filing the false lien, Chance filed three false claims for tax refunds for tax years 2007, 2008 and 2009, seeking a total of $900,000. These three false tax returns were almost identical to the 2005 return for which he was previously convicted. On the 2005 tax return, Chance claimed he was the Andrew Chance Trust. On the 2007-2009 returns, he claimed he was the Andrew I Chance Trust. On each return in the current case, Chance claimed $300,000 in refunds based on completely false income and withholding amounts. The government introduced evidence that, despite having claimed withholdings on the false returns, Chance had no withholdings and, in fact, had demanded that Metro, from which he retired as a station manager in 1999, not withhold taxes from his retirement pay.
“This verdict is a clear message that filing false retaliatory liens against federal officials, including federal prosecutors who are simply doing their jobs, is illegal and will be punished,” said Deputy Assistant Attorney General Ronald A. Cimino of the Justice Department’s Tax Division.
Chance was on federal supervised release and state probation at the time of the conduct giving rise to this indictment. He still faces court actions related to those release violations.
Chance faces maximum punishment of up to 25 years in prison and $1 million in fines. Judge Williams scheduled sentencing for Feb. 15, 2012.
The case was investigated by the IRS and the Treasury Inspector General for Tax Administration, and prosecuted by Tax Division Trial Attorneys Jen E. Ihlo and Erin B. Pulice.
Additional information about the Justice Department’s Tax Division and its enforcement efforts is available at www.usdoj.gov/tax.