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28 September 2012
U.S. Government Intervenes in False Claims Suit <br /> Against CH2M Hill Hanford GroupRead the Press Release
The government has intervened in a lawsuit against CH2M Hill Hanford Group Inc. (CH2M Hill) in the U.S. District Court for the Eastern District of Washington, the Department of Justice announced today. CH2M Hill is a subsidiary of CH2M Hill Companies Ltd., a Colorado-based engineering and construction services company.
Between 1999 and 2008, CH2M Hill was a U.S. Department of Energy prime contractor responsible for the management and cleanup of over 170 underground storage tanks containing mixed radioactive and hazardous waste at the Department of Energy’s Hanford Nuclear Site in southeastern Washington. The lawsuit filed by Mr. Schroeder alleges that numerous CH2M Hill hourly employees regularly and substantially overstated the number of hours that they worked. The complaint also alleges that CH2M Hill management knowingly condoned this practice and submitted inflated claims to the Department of Energy that included the fraudulently claimed hours.
Eight former CH2M Hill employees, including Mr. Schroeder, have pleaded guilty to felony charges stemming from the time card fraud. The lawsuit was originally filed under the False Claims Act by Carl Schroeder, a former employee of CH2M Hill.
The False Claims Act authorizes private parties to sue on behalf of the United States and authorizes the United States to intervene in such a suit and take over responsibility for litigating it. Although the act generally authorizes the whistleblower who initiated the suit to share in any recovery, it also bars recovery by any whistleblower who is convicted of criminal conduct for his role in the fraud/ The United States has notified the court that it expects to file a motion to dismiss Mr. Schroeder from the action on the basis of is criminal conduct. Mr. Schroder’s lawsuit is captioned U.S. ex rel. Schroeder v. CH2M Hill, 09-cv-5038.
The claims asserted in this case are allegations only, and there has been no determination of liability. The case is being handled by the Civil Division of the Department of Justice and the U.S. Attorney’s Office for the Eastern District of Washington, with the assistance of the Department of Energy Office of Inspector General.
U.S. Customs and Border Protection Officer Pleads Guilty to Impersonating U.S. Customs AttachéRead the Press Release
WASHINGTON – A supervisory customs and border protection officer pleaded guilty today in the Southern District of Florida to impersonating a U.S. Customs attaché and making false statements related to his assignment with the U.S. Customs and Border Protection (CBP) Preclearance Office in Dublin, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Wifredo A. Ferrer for the Southern District of Florida.
Roger J. Kiley, 42, of Miami, pleaded guilty today before U.S. District Judge Ursula Mancusi Ungaro in Miami to a criminal information charging him with one count of false personation and one count of making a false statement.
According to court documents, Kiley was stationed at the CBP Preclearance Office in Dublin from 2009 to 2011. As part of his plea agreement, Kiley admitted that he began a romantic relationship with a Dublin resident in 2010. Kiley also admitted that he held himself out to this individual as the Customs attaché at the U.S. Embassy in Dublin, a government position that did not exist, and that he could arrange for the embassy to lease the residence she was living in as his embassy residence. Kiley further admitted that he created a fake lease from the embassy as well as a funding cable for the payment of the lease on the residence. Kiley also admitted that he created a bogus letter from the embassy authorizing the relocation of Kiley and his romantic interest to the United States, and that he forged the signature of the deputy chief of mission on the letter. Kiley further admitted that he lied to federal agents in February 2012 when interviewed about the allegations of misconduct while he was in Dublin.
Kiley faces up to three years in prison, a $250,000 fine and a year of supervised release for the charge of false personation. He faces five years in prison, a $250,000 fine and three years of supervised release for the false statement charge. Kiley is also responsible for restitution in the amount of $2,500. Sentencing has been scheduled for Dec. 7, 2012.
This case is being prosecuted by Trial Attorney Richard B. Evans of the Criminal Division’s Public Integrity Section and Robin W. Waugh, Assistant U.S. Attorney for the Southern District of Florida. The case is being investigated by the CBP Office of Internal Affairs.
Florida Halfway House Owner Pleads Guilty for Role in Medicare Fraud SchemeRead the Press Release
WASHINGTON – The owner of a Broward County, Fla.-area halfway house pleaded guilty yesterday for his role in a kickback scheme that funneled patients to a fraudulent mental health provider, announced, the Department of Justice and Department of Health and Human Services.
Giuseppe Pellerito, 59, pleaded guilty before U.S. District Judge Marcia G. Cooke in Miami to one count of conspiracy to receive health care kickbacks and two counts of receiving kickbacks. Pellerito is the owner of Florida Sober House, a Florida corporation with multiple halfway houses in Broward and Palm Beach County, Fla.
According to court documents, Pellerito agreed to send Medicare beneficiaries who resided at Florida Sober House to American Therapeutic Corporation (ATC), a fraudulent mental health provider, for partial hospitalization program (PHP) treatment, a form of mental health treatment for severe mental illness, in exchange for illegal health care kickbacks. ATC purported to operate PHPs in seven different locations throughout south Florida and Orlando. According to court documents, Pellerito admitted he knew ATC fraudulently billed Medicare for the PHP treatment that his referrals purportedly received at ATC. He also admitted he referred his halfway house residents to ATC because they had Medicare and were willing to go to ATC, and because he would receive a cash kickback.ATC, its management company Medlink Professional Management Group Inc., a related company called American Sleep Institute (ASI), and various owners, managers, doctors, therapists, patient brokers and marketers of ATC and 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 14 of the individual defendants have pleaded guilty or have been convicted at trial. On June 1, 2012, five other defendants, including two Miami-based doctors, were convicted after a seven-week trial before U.S. District Judge Patricia A. Seitz, for their involvement in the ATC scheme.
The 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, Acting Special Agent-in-Charge of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher B. Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.
The case is being prosecuted by Trial Attorney William Parente of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,330 defendants who have collectively billed the Medicare program for more than $4 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.
Co-Founder of Casino-Cheating Criminal Enterprise Sentenced to 36 Months in Prison for Targeting Casinos Across the United StatesRead the Press Release
WASHINGTON – Van Thu Tran was sentenced today in San Diego to 36 months in prison for her role in a scheme to cheat casinos across the country out of millions of dollars, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney Laura E. Duffy for the Southern District of California.
In addition to her prison sentence, Van Thu Tran, 47, was sentenced by U.S. District Judge John A. Houston in the Southern District of California to three years of supervised release and ordered to pay $5,753,416 in restitution, payable to several casinos. The court ordered the forfeiture of her interests in various assets, including jewelry and bank accounts.
Van Thu Tran entered her guilty plea in San Diego on Jan. 14, 2011.
In her plea agreement, Van Thu Tran admitted that in approximately August 2002, she, along with co-conspirators Phuong Quoc Truong, Tai Khiem Tran and others, created a criminal enterprise defined as the Tran Organization, based in San Diego and elsewhere, for the purpose of participating in gambling cheats at casinos across the United States. In her plea agreement, Van Thu Tran also admitted that she and her co-conspirators unlawfully obtained up to $7 million during card cheats.
The investigation of the Tran Organization led to the filing of three separate indictments in 2007, 2008 and 2009. A three-count indictment was returned in San Diego on May 22, 2007, and unsealed on May 24, 2007, which charged Van Thu Tran and 13 others each with one count of conspiracy to participate in the affairs of a racketeering enterprise; one count of conspiracy to commit several offenses against the United States, including conspiracy to steal money and other property from Indian tribal casinos; and one count of conspiracy to commit money laundering. The indictment also charged five separate individuals each with one count of conspiracy to commit several offenses against the United States, including conspiracy to steal money and other property from Indian tribal casinos; and one count of conspiracy to commit money laundering.
According to court documents, the defendants and others executed a “false shuffle” cheating scheme at casinos in the United States and Canada during blackjack and mini-baccarat games. Court documents also show that members of the criminal organization bribed casino card dealers and supervisors to perform false shuffles during card games, thereby creating “slugs” or groups of unshuffled cards. Court documents also show that, after tracking the order of cards dealt in a card game, a member of the organization would signal to the card dealer to perform a “false shuffle,” and members of the group would then bet on the known order of cards when the slug appeared on the table. By doing so, members of the conspiracy repeatedly won thousands of dollars during card games, including winning several hundred thousand dollars on one occasion.
Court documents also show that the members of the organization used sophisticated mechanisms for tracking the order of cards during games, including hidden transmitter devices and specially created software that would predict the order in which cards would reappear during blackjack games.
To date, 42 defendants have pleaded guilty to charges relating to the casino-cheating conspiracy: Van Thu Tran, Phuong Quoc Truong, Tai Khiem Tran, Anh Phuong Tran, Phat Ngoc Tran, Martin Lee Aronson, Liem Thanh Lam, George Michael Lee, Tien Duc Vu, Son Hong Johnson, Barry Wellford, John Tran, Willy Tran, Tuan Mong Le, Duc Cong Nguyen, Han Truong Nguyen, Roderick Vang Thor, Sisouvanh Mounlasy, Navin Nith, Renee Cuc Quang, Ui Suk Weller, Phally Ly, Khunsela Prom, Hop Nguyen, Hogan Ho, Darrell Saicocie, Bryan Arce, Qua Le, Outtama Keovongsa, Leap Kong, Thang Viet Huynh, Don Man Duong, Dan Thich, Jimmy Ha, Eric Isbell, Brandon Pete Landry, James Root, Jesus Rodriguez, Jason Cavin, Nedra Fay Landry, Connie Holmes and Geraldo Montaz. These defendants admitted to targeting, with the aid of co-conspirators, a combined total of approximately 29 casinos in the United States and Canada during the course of the conspiracy:
1) Beau Rivage Casino in Biloxi, Miss.; 2) Casino Rama, in Orillia, Ontario, Canada; 3) Foxwoods Resort Casino in Ledyard, Conn.; 4) Gold Strike Casino in Tunica, Miss.; 5) Horseshoe Casino in Bossier City, La.; 6) Horseshoe Casino and Hotel in Tunica, Miss.; 7) Isle of Capri Casino in Westlake, La.; 8) Majestic Star Casino in Gary, Ind.; 9) Mohegan Sun Resort Casino in Uncasville, Conn.; 10) Palace Station Casino in Las Vegas; 11) Resorts East Chicago Hotel and Casino in East Chicago, Ind.; 12) Sycuan Casino in El Cajon, Calif.
13) Cache Creek Indian Bingo and Casino in Brooks, Calif.; 14) Emerald Queen Casino in Tacoma, Wash.; 15) Imperial Palace Casino in Biloxi; 16) Argosy Casino in Baton Rouge, La.; 17) Trump 29 Casino in Coachella, Calif.; 18) Isle of Capri Casino in Bossier City; 19) Agua Caliente Casino in Rancho Mirage, Calif.; 20) Spa Resort Casino in Palm Springs, Calif.; 21) Pechanga Resort and Casino in Temecula, Calif.; 22) L'Auberge du Lac Casino in Lake Charles, La.; 23) Nooksack River Casino in Deming, Wash.; 24) Barona Valley Ranch Casino and Resort in Lakeside, Calif.; 25) Caesars Indiana Hotel and Casino in Elizabeth, Ind.; 26) Monte Carlo Resort and Casino in Las Vegas; 27) Harrah’s Casino in Lake Charles; 28) Golden Moon Casino in Choctaw, Miss.; and
29) Viejas Casino in Alpine, Calif.Two other defendants, Ha Thuy Giang and Tammie Huynh, pleaded guilty to tax offenses stemming from the investigation, and Khai Hong Tran admitted to the offenses alleged in a 2007 U.S. indictment when he pleaded guilty to casino-cheating offenses in Canada.
On Dec. 15, 2010, defendant Mike Waseleski, a former casino card dealer, was found guilty by a federal jury in San Diego for his role in the Tran Organization’s cheating scheme to steal approximately $1.5 million from Resorts East Chicago Casino.
The case is being investigated by the FBI’s San Diego Field Office; the Internal Revenue Service-Criminal Investigation; the San Diego Sheriff’s Department; and the California Department of Justice’s Bureau of Gambling Control. The investigation has received assistance from federal, state, tribal and foreign authorities, including: the Ontario Provincial Police; the National Indian Gaming Commission; the U.S. Attorney’s Office for the Southern District of California; the U.S. Attorney’s Office for the Western District of Washington; FBI Resident Agencies in Gulfport, Miss., Tacoma, Wash., and Toledo, Ohio; the Indiana State Police; the Rumsey Rancheria Tribal Gaming Agency; the Sycuan Gaming Commission; the Barona Gaming Commission; the Mississippi Gaming Commission; and the Washington State Gambling Commission.
The case is being prosecuted in San Diego by Criminal Division Organized Crime and Gang Section Trial Attorneys Joseph K. Wheatley and Robert S. Tully.
27 September 2012
Narcotics Trafficker Faces Life in Prison for Murder of WitnessRead the Press Release
WASHINGTON – Narcotics trafficker Edison Burgos-Montes of Yauco, Puerto Rico, faces life in prison following his conviction on two capital murder counts, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division and U.S. Attorney for the District of Puerto Rico Rosa Emilia Rodríguez-Vélez.
On Aug. 29, 2012, Burgos-Montes, 42, was convicted on four counts following a five-month trial before U.S. District Judge Jay García-Gregory in San Juan: conspiracy to possess with intent to distribute cocaine, conspiracy to import cocaine, murdering a witness to prevent testimony in an official proceeding and murdering a witness in retaliation for providing information to law enforcement.
The counts of conviction on capital murder charges necessitated a separate penalty phase of the trial. That phase began on Sept. 12, 2012, and concluded after a week and a half of testimony on Sept. 19, 2012. The jury was unable to reach a sentencing verdict after two and a half days of deliberation, so a sentence of life in prison will be imposed. There is no parole in the federal system.
As the evidence at trial showed, Burgos-Montes killed Madelyn Semidey-Morales – a government witness and informant and his consensual partner – to retaliate against her for providing information to law enforcement about his unlawful narcotics trafficking and to prevent her from providing authorities with additional information.
Burgos-Montes will be formally sentenced on all four charges on a date to be determined.The penalty phase of the case was prosecuted by Trial Attorneys Julie Mosley and Jeffrey Kahan of the Justice Department Criminal Division’s Capital Case Unit and Assistant U.S. Attorney Marcela Mateo of the District of Puerto Rico. The case was investigated by the Drug Enforcement Administration and the Puerto Rico Police Department, with assistance from the FBI’s San Juan Field Office Evidence Recovery Team.
Massachusetts Tax Fraud Promoter Sentenced to Four Years in Prison for Tax Evasion and Conspiracy to Obstruct and Impede the IRSRead the Press Release
A federal judge in Boston sentenced Charles Adams today to 48 months in prison for tax evasion, conspiring to defraud the United States and obstructing the Internal Revenue Service (IRS), the Justice Department and IRS announced. U.S. District Judge F. Dennis Saylor also ordered Adams to pay restitution in the amount of $401,000.
On April 2, 2012, a federal jury convicted Adams, of Norwood, Mass., as well as Catherine Floyd and William Scott Dion, both of Sanbornville, N.H., for conspiracies to defraud the United States through the promotion and use of multiple tax fraud schemes. The jury convicted all three of conspiracy to defraud the IRS by promoting an “under the table” payroll scheme. Dion and Floyd were also convicted for conspiracy to defraud the IRS through the use of an “underground warehouse banking” scheme designed to conceal customer income and assets from the IRS. Floyd and Dion were also convicted separately for corruptly endeavoring to obstruct the IRS’s ability to determine their own income. Adams was separately convicted of tax evasion with respect to his own taxes.
On Sept. 6, 2012, Judge Saylor sentenced Dion to 84 months in prison and ordered him to pay $3 million in restitution. On Sept. 21, 2012, Judge Saylor sentenced Floyd to 60 months in prison and ordered her to pay $3 million in restitution.
According to the evidence presented at trial, Adams, Floyd and Dion ran a payroll tax scheme in order to pay employees “under the table” without properly accounting for, withholding and paying over to the IRS the payroll taxes required by law. The three promoted the payroll scheme to employers and individuals who wanted to avoid payment of employer payroll taxes and individual payroll taxes. They ran the payroll scheme under three different names: Contract America, Talent Management and New Way Enterprises. Approximately 150 individuals subscribed to the payroll scheme and in excess of $2.5 million in unreported wages and compensation were paid through the system.
The evidence at trial also established that Floyd and Dion conspired to defraud the United States by promoting and operating an “underground warehouse banking” scheme which helped subscribers conceal income and assets from the IRS. According to the evidence, the warehouse scheme operated under three different names: Your Virtual Office, Office Services and Calico Management. As part of the warehouse banking scheme, the defendants maintained accounts at several banks and used the accounts to deposit and commingle business receipts and other funds received from subscribers in order to mask the true ownership of the funds. According to evidence presented at trial, more than $28 million in deposits were made into the various bank accounts used in the scheme.
In August 2009, the three defendants were indicted with four other individuals relating to the promotion and use of these schemes. On Dec. 9, 2011, prior to trial, Gail and Myron Thorick of West Warwick, R.I., pleaded guilty to conspiring to defraud the United States by helping operate the “warehouse banking” scheme, and for filing false tax returns. On that same date, Gary Alcock pleaded guilty to conspiracy by using the payroll scheme, as well as to tax evasion and willful failure to file tax returns. On Jan. 24, 2012, Kenneth Scott Alcock pleaded guilty to conspiracy relating to the payroll scheme and to one count of tax evasion. All four defendants are awaiting sentencing.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, and Carmen M. Ortiz, U.S. Attorney for the District of Massachusetts, commended the efforts of special agents of IRS - Criminal Investigation, who investigated the case, and Tax Division Assistant Chief John N. Kane, former Tax Division Trial Attorney Jeffrey Shih, and Assistant U.S. Attorney Victor A. Wild, who prosecuted the case.
Justice Department Settles with Florida Janitorial Services Company over Immigration and Nationality Act ViolationsRead the Press Release
The Justice Department announced today that it reached an agreement with Diversified Maintenance Systems LLC, a provider of janitorial and facilities maintenance services based in Tampa, Fla . The agreement resolves allegations that the company violated the anti-discrimination provision of the Immigration and Nationality Act (INA) when it failed to fully reinstate an employee in retaliation for asserting her right to work in the U.S.
The charging party alleged that the company failed to provide the employee with proper notice and instructions for contesting an initial data mismatch in E-Verify, resulting in E-Verify issuing an erroneous final response that she was not work authorized. E-Verify is an Internet-based system run by the U.S. Citizenship and Immigration Services (USCIS) that confirms employment eligibility by comparing information from an employee’s Form I-9.
While the employee immediately visited the Social Security Administration (SSA) after receiving verbal notice of the initial data mismatch and instructions from her supervisor, the employee alleged that the supervisor failed to give her the proper E-Verify paperwork which would have enabled the SSA to resolve the mismatch. As a result, the E-Verify program provided an erroneous final response, known as a “final nonconfirmation,” to the employer, stating that the charging party was not eligible to work in the U.S. The company subsequently terminated the employee, and the employee contacted the E-Verify hotline for help. An E-Verify agent notified the employer that the employee is authorized to work, but the employee’s manager refused to reinstate her employment, allegedly because she contacted E-Verify and asserted her right to work under the anti-discrimination provision of the INA. The INA protects employees from discriminatory practices in the employment eligibility verification process, including E-Verify, and prohibits employers from retaliating against individuals who assert their rights or oppose a practice that is illegal under the provision.
Under the terms of the settlement agreement, the company has agreed to pay $6,800 in monetary relief to the injured party, which included back pay and interest, along with a $2,000 civil penalty. The company has also agreed to training by the Justice Department on the anti-discrimination provision and training by the Department of Homeland Security on proper E-Verify procedures. The case settled prior to the Justice Department filing a complaint in this matter.
“The Civil Rights Division has a critical partnership with USCIS in working to ensure that work authorized individuals are not denied the opportunity to work based on misuse, abuse or discriminatory use of E-Verify,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “Retaliation against employees for asserting their right to call the government for help when they think their rights have been violated will not be tolerated.”
The Office of Special Counsel for Immigration Related Unfair Employment Practices (OSC) is responsible for enforcing the anti-discrimination provision of the INA. For more information about protections against employment discrimination under the immigration laws, call the OSC’s worker hotline at 1-800-255-7688 (1-800-237-2525, TDD for hearing impaired), call the OSC’s employer hotline at 1-800-255-8155 (1-800-362-2735, TDD for hearing impaired), sign up for a no-cost webinar at www.justice.gov/crt/about/osc/webinars.php, email [email protected] or visit the website at www.justice.gov/crt/about/osc.
Justice Department Awards $101 Million to Enhance, Support Tribal Justice and SafetyRead the Press Release
WASHINGTON – The Department of Justice today announced more than 200 grants to more than 110 American Indian and Alaska Native nations. The grants will provide more than $101 million to enhance law enforcement practices, and sustain crime prevention and intervention efforts in 10 purpose areas including public safety and community policing; justice systems planning; alcohol and substance abuse; corrections and correctional alternatives; violence against women; elder abuse; juvenile justice; and tribal youth programs.
“Over the last several years, we’ve consulted with tribes and participated in listening sessions that provided a clear message of a need for coordination and flexibility to access our grant resources,” said Acting Associate Attorney General Tony West. “Our outreach and communication with tribal governments have been critical to our understanding of how to better serve and support our tribal partners. These awards represent our ongoing commitment to help put an end to the unacceptable and sobering crime rates witnessed in Indian Country.”
The awards are made through the department’s Coordinated Tribal Assistance Solicitation (CTAS), a single application for tribal-specific grant programs. The department developed CTAS through its Office of Community Oriented Policing, Office of Justice Programs and Office on Violence against Women, and administered the first round of consolidated grants in September 2010. It awarded 286 grants totaling $245 million in 2011 and 2012. Information about the consolidated solicitation is available at www.justice.gov/tribal. A fact sheet on CTAS is available at www.justice.gov/tribal/ctas2012/ctas-factsheet.pdf.Next month, the Justice Department will hold its annual consultation on violence against native women on Oct. 2, 2012, in Tulsa, Okla. In addition, an Interdepartmental Tribal Justice, Safety and Wellness Session will be held in Tulsa, on Oct. 3-4, 2012. It will provide a Listening Session on the Tribal Law and Order Act Tribal Justice Plan Implementation Strategy and include valuable training and technical assistance.
Today’s announcement is part of the Justice Department’s ongoing initiative to increase engagement, coordination and action on public safety in tribal communities.Former Florida Fundraiser and Accountant Associate<br /> Plead Guilty for Illegal Campaign ContributionsRead the Press Release
WASHINGTON – Timothy F. Mobley, a real estate developer based in Tampa, Fla., and accountant Timothy F. Hohl pleaded guilty today in Jacksonville, Fla., federal court for their roles in illegal contributions to the Republican Party of Florida (RPOF) and the campaign of an elected member of the U.S. Congress, announced Assistant Attorney General Lanny A. Breuer.
Mobley, 60, pleaded guilty to one count each of making illegal conduit and illegal corporate contributions in violation of the Federal Election Campaign Act (FECA). Hohl, 60, of Tampa, Fla., pleaded guilty to three counts of aiding and abetting those illegal contributions. Both defendants entered their guilty pleas before U.S. Magistrate Judge Joel B. Toomey.During his guilty plea hearing, Mobley admitted that from March 2006 through October 2008, he made contributions to the campaign of an individual referred to in court documents as “Federal Elected Official A” that were above the limit established by FECA. Mobley admitted he disguised these contributions by recruiting and providing money to employees of his business entities and to one employee’s family member. He also admitted he used corporate funds to illegally reimburse the conduit contributions, and that he attempted to conceal reimbursements to various employees by characterizing them as legitimate bonus compensation or advances on bonus compensation. Mobley admitted that in all, he reimbursed a total of $10,000 to RPOF and $84,300 in contributions to the campaign of Federal Elected Official A.
During his guilty plea hearing, Hohl admitted that while working as an accountant to Mobley and Mobley’s business entities from 2006 through 2008, he aided and abetted Mobley’s scheme to make the illegal excessive contributions. Hohl admitted he did so by participating in the reimbursement of other individuals, seeking and accepting reimbursement for his own contributions, and seeking and accepting reimbursement for his wife’s contributions.
On the FECA count charging him with making illegal excessive contributions in the amount of $25,000 or more for the calendar year 2008, Mobley faces a maximum potential penalty of five years in prison and a $632,000 fine. On the second FECA count, charging him with making illegal corporate contributions in the amount of $25,000 or more for the calendar year 2008, he faces a maximum potential penalty of five years in prison and a $250,000 fine.
Hohl pleaded guilty to three counts charging him with aiding and abetting Mobley’s reimbursement scheme in 2006, 2007 and 2008, respectively. The maximum potential penalty for each offense is one year in prison and a $100,000 fine.This case is being prosecuted by Trial Attorneys John P. Pearson and Eric G. Olshan of the Justice Department’s Public Integrity Section. The case was investigated by the Jacksonville and Tampa Field Offices of the FBI. The U.S. Attorney’s Office for the Middle District of Florida provided assistance.
Department of Justice and Federal Trade Commission Sign<br /> Memorandum of Understanding with Indian Competition AuthoritiesRead the Press Release
WASHINGTON – The U.S. Department of Justice and Federal Trade Commission (FTC) signed an antitrust memorandum of understanding (MOU) with the Government of India Ministry of Corporate Affairs and the Competition Commission of India (CCI) today to promote increased cooperation and communication among competition agencies in both countries. The ceremony took place in Washington, D.C.The MOU was signed by Acting Assistant Attorney General Joseph Wayland of the Department of Justice’s Antitrust Division, Chairman Jon Leibowitz of the FTC, Indian Ambassador to the United States Nirupama Rao on behalf of the Indian Ministry of Corporate Affairs and CCI Chairman Ashok Chawla.
“We value our relationship with the Indian Ministry of Corporate Affairs and the Competition Commission of India. We know that this memorandum of understanding will enhance that relationship in the years ahead, as we work together to ensure that markets are open and competitive, by identifying and remedying anticompetitive behavior,” said Acting Assistant Attorney General Wayland.
Commenting on the signing, Chairman Leibowitz said, “We are delighted to enter into this memorandum of understanding with the Indian Ministry of Corporate Affairs and the Competition Commission of India. It will strengthen the already excellent relations among the U.S. and Indian competition authorities by further facilitating cooperation on policy and enforcement matters.”Key provisions of the MOU address the following:
- Cooperation - The MOU provides that the U.S. antitrust agencies and Indian authorities will work to keep each other informed of significant competition policy and enforcement developments in their jurisdictions, and establishes a framework for technical cooperation. The MOU also recognizes that when the U.S. and Indian competition agencies are investigating related matters, it may be in their common interests to cooperate.
- Communication - The MOU establishes a framework for the U.S. antitrust agencies and the Indian competition authorities to consult on matters of competition enforcement and policy. It also contemplates periodic meetings among officials to exchange information on policy and enforcement priorities.
The MOU is a framework for voluntary cooperation and will not change existing law in either country. India adopted its modern competition law in 2002, and the law’s main provisions were put into effect between 2009 and 2011.
Court Security Contractor to Pay $1.8 Million to Resolve Allegations That Guards Did Not Undergo Authorized Firearm Qualification TestingRead the Press Release
New Mexico-based Akal Security, Inc., one of the largest providers of security services at federal courthouses, agreed to pay $1,875,000 to resolve allegations that it failed to appropriately conduct firearms testing in the Northern District of California, the Justice Department announced today. The Northern District of California includes federal courthouses in San Francisco, Oakland and San Jose.
Akal Security provides court security officers to guard federal courthouses under a contract with the U.S. Marshals Service. Under its contract, Akal Security must ensure that its security officers pass an approved firearms qualification test and certify the results. The test requires that security officers accurately fire a designated number of rounds within strict time limits. Security officers who do not receive a qualifying score may not work as security officers under the contract.
The United States alleged that from 2007 to 2011 certain Akal Security rangemasters who administered the test did not apply the time limitations, sometimes out of concern that security officers would not be able to pass a timed test. The United States further alleged that the rangemasters then certified to the Marshals Service that the tests had been conducted appropriately when, in fact, they had not. As a result, the United States alleged, numerous security officers continued to work even though Akal Security had failed to ensure they could pass the required firearms qualification test.
Corrective steps have been taken to assure compliance by Akal Security and all affected court security officers are now properly certified. The United States’ investigation did not uncover evidence of violations of firearms qualification testing outside of the Northern District of California.
“Those who guard federal courthouses not only have a duty to properly bill for their services, but also to ensure the safety of the individuals who work at and visit their federal courthouses,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division. “As this settlement demonstrates, there will be a steep price to pay for the failure to satisfy these important obligations.”
“Companies contracting with the government must be held accountable for the misconduct of their employees,” said Michael E. Horowitz, Inspector General for the Department of Justice. “We are committed to ensuring that the taxpayers’ funds are spent wisely and in accordance with negotiated contracts and regulations.”
The Assistant Attorney General thanked the Office of the Inspector General for the Department of Justice and the Department of Justice’s Commercial Litigation Branch for the collaboration that resulted in today’s settlement. The claims settled by this agreement are allegations only, and there has been no determination of liability.
BP Products North America to Improve Spill Response Preparedness at Oil Terminals NationwideRead the Press Release
BP Products North America, Inc. will pay a $210,000 penalty and implement an enhanced oil spill response program at its oil terminals nationwide, as well as a comprehensive compliance audit to resolve alleged violations of oil spill response regulations at its Curtis Bay Terminal in Maryland, the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Justice announced today. The enhanced oil spill response program will help ensure that BP Product’s oil terminals are better prepared to respond to oil spills that could impact human health and the environment.
EPA alleged that BP Products violated federal regulations requiring oil storage facilities to conduct drills and exercises to respond to oil spills at its Curtis Bay Terminal. The civil penalty is EPA’s highest to date for violations of oil drills and exercises requirements where there was no discharge of oil.
“This agreement will help BP Products strengthen its spill response capabilities across the nation at 33 onshore oil terminals, implementing enhanced oil spill response measures, and requiring an independent auditor to evaluate a dozen high-risk onshore facilities for their readiness to respond to oil spills,” said Ignacia S. Moreno, Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice. “Taking these steps will help instill a culture of readiness and preparedness that will help protect many communities, and the natural resources upon which they rely, from future harm.”
“Being prepared to respond to an oil spill can be the difference between dealing with a small, contained event or a full-blown environmental disaster,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. “After twice failing to pass oil spill response exercises at its Curtis Bay facility, under the settlement, BP is required to put preventative measures into place at all of its terminals nationwide that will reduce the threat of oil spills and protect our nation’s valuable waterways. These measures also raise the bar for forward-looking companies seeking to ensure that their facilities are ready to respond quickly in the event of a spill.”
Under the settlement filed today in federal court by the U.S. Department of Justice, BP Products will implement a first-of-its-kind program of spill prevention measures at its 33 non-refinery petroleum products terminals across the country.
As part of this program, the company will review and revise response plans for these facilities to ensure safeguards are tailored to the conditions at each facility. BP Products will also perform enhanced training, drills and exercises, exceeding regulatory requirements, and will repeat any failed drills and exercises within 90 days.
In addition, BP Products has agreed to an independent compliance audit of 12 of its marine and high-risk petroleum product terminal facilities. The audits will ensure that each audited facility is in compliance with spill response requirements, and to evaluate whether the facilities have resources to respond to major spills. The results of the compliance audits will also be incorporated into the enhanced spill prevention and response program being implemented at all of BP’s petroleum terminals.
EPA and the U.S. Coast Guard twice conducted unannounced government-initiated oil spill response exercises at the Curtis Bay Terminal. During these exercises, BP Products was required to demonstrate its response to a small scale discharge of fuel oil from the facility into Curtis Creek by being prepared to deploy 1,000 feet of oil containment boom within one hour and subsequently deploying the boom. On both occasions, the company did not complete the exercise in the allotted time and failed to adequately deploy the containment boom.
The Curtis Bay Terminal, which can store about 22 million gallons of oil, is located less than a quarter mile from Curtis Creek, a tributary of Curtis Bay, the Patapsco River and the Chesapeake Bay.
High-risk onshore facilities that store oil, such as the Curtis Bay Terminal, must have a plan for responding to oil spills that includes employee training, spill response equipment, and a “worst case” contingency plan for containing and cleaning up spills.
Based on the failed drills, EPA cited the company for failing to adequately implement a response plan, failing to identify sufficient spill response resources at the facility, and deficiencies in the facility’s training, drills and exercises program.
The proposed consent decree is subject to a 30 day public comment period and final court approval. The consent decree may be viewed on the Department of Justice website: www.justice.gov/enrd/Consent_Decrees.html
More information about the settlement: www.epa.gov/enforcement/water/cases/curtisbay.html
More information about EPA’s Federal Response Plan requirements: http://www.epa.gov/emergencies/content/frps/index.htm
More about the Spill Prevention Control and Countermeasure requirement: http://www.epa.gov/emergencies/content/spcc/index.htm
Agreement Secures $25 Million Cleanup for the Rio Tinto Mine in NevadaRead the Press Release
The Department of Justice, the U.S. Environmental Protection Agency (EPA) and the Nevada Division of Environmental Protection announced a $25 million agreement for the cleanup of the Rio Tinto Mine, an abandoned copper mine in Elko County, Nev. Four companies have agreed to pay for the environmental project.
The state of Nevada will oversee the cleanup with input from EPA and the Shoshone Paiute Tribes of Duck Valley. The four corporations financing the cleanup, Atlantic Richfield Company, DuPont and Company, The Cleveland-Cliffs Iron Company and Teck American Inc. are corporate successors to companies that operated the mine from 1932 to 1976. A fifth entity, Mountain City Remediation, has been created by the four defendants to conduct the cleanup.
Under the terms of the agreement, the defendants agreed to remove mine tailings from Mill Creek, improve the creek to support the redband trout, and improve water quality in Mill Creek and the East Fork Owyhee River. The defendants will also pay for the Shoshone Paiute Tribes to monitor the cleanup. The companies are required to provide robust performance guarantees including payments to a trust account they will use to implement the cleanup.
“This agreement will result in the cleanup of mine contamination, protection of Nevada’s Owyhee River, and the restoration of a natural and cultural resource that is invaluable to the Shoshone Paiute people,” said Ignacia S. Moreno, Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice. “This significant effort demonstrates a spirit of collaboration and commitment to environmental and natural resource protection that we share with our federal, state and tribal partners.”
“This project is a great example of federal, state and tribal agencies working side-by-side to reach a cleanup agreement with private parties,” said Jared Blumenfeld, EPA’s Regional Administrator for the Pacific Southwest. “The companies will not only clean up mine tailings, but also enhance the habitat for redband trout.”
“To the Shoshone Paiute people, the redband trout is not merely a species to be considered; it is a cultural resource. And the habitat for the trout must be protected as well,” said Terry Gibson, Tribal Chairman. “The cleanup effort at the Rio Tinto Mine is very encouraging, and is an essential step to restoring and protecting these cultural resources, not only for today, but for generations to come”
“The efforts of federal, state and tribal agencies over the past few years have culminated in a settlement designed to improve significant cultural and natural resources of Nevada,” said Nevada Attorney General Catherine Cortez Masto. “In addition, we believe this project will bring an economic benefit to Elko County.”
“We are really pleased to see a final agreement between all of the parties and to have work begin at this site,” stated Nevada Department of Environmental Protection Administrator, Colleen Cripps.
The consent decree, a formal settlement under the federal Superfund law, will be posted in the Federal Register and will be available for public comment for a period of 30 days. The consent decree will be available to be viewed on the Justice Department website: www.justice.gov/enrd/Consent_Decrees.html.
The Rio Tinto Mine site is located approximately 2.5 miles south of Mountain City on Mill Creek, a tributary of the East Fork Owyhee River.
26 September 2012
Virginia Man Pleads Guilty to Trafficking in <br /> Counterfeit GM Diagnostic EquipmentRead the Press Release
A Virginia man pleaded guilty today in federal court to selling counterfeit General Motors (GM) automotive diagnostic devices used by mechanics to identify problems with and assure the safety of motor vehicles, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney for the Eastern District of Virginia Neil H. MacBride and FBI Assistant Director Joseph Demarest.
Justin DeMatteo, 31, of Saxe, Va., pleaded guilty before Senior U.S. District Judge Claude M. Hilton in U.S. District Court in the Eastern District of Virginia to an information charging him with one count of trafficking in goods bearing counterfeit marks. DeMatteo, in a plea agreement with the government, also agreed to pay restitution of $328,500 (the full amount of GM’s losses) and forfeit $109.074 and all facilitating property and contraband seized during the execution of search warrants at his business and home on Dec. 15, 2011 . Sentencing is scheduled for Jan. 11, 2013.
In court documents, DeMatteo admitted he sold counterfeit GM Corporation-branded “Tech 2” vehicle diagnostic systems between January and May 2011. The Tech 2 is a hand-held computer used to diagnose problems in vehicles that use electronic controls and interfaces. For newer vehicles, GM designed a new diagnostic interface – the Controller Area Network diagnostic interface (CANdi) module, which serves as an enhancement to the Tech 2 and completes the interface necessary to communicate with future on-board computer systems.
DeMatteo also admitted he offered for sale purported Tech 2 units and CANdi modules that bore counterfeit GM marks. DeMatteo sold the counterfeit Tech 2 units on eBay and accepted payment via Paypal. DeMatteo purchased the units from unauthorized manufacturers in the People’s Republic of China (PRC) and in many cases had them drop-shipped directly from the PRC to U.S. customers. On Dec. 15, 2011, federal agents executed search warrants at DeMatteo’s residence in Saxe and place of business in South Boston, Va. Among other things, agents seized numerous counterfeit GM Tech 2 units and CANdi modules, and various computer equipment and documents that contained evidence linking DeMatteo to the sale of the counterfeit Tech 2 units. According to the stipulated statement of facts and plea agreement, the number of Tech 2 and CANdi units sold by DeMatteo or seized during the searches totaled nearly 100. The retail price of 100 authentic products would have been more than $380,000.
The case was prosecuted by Assistant U.S. Attorney Lindsay Kelly of the Eastern District of Virginia and Trial Attorney Evan Williams of the Criminal Division’s Computer Crime and Intellectual Property Section and was investigated by the FBI’s Intellectual Property Rights Unit.
Pennsylvania Corporation Pleads Guilty to Bid Rigging atMunicipal Tax Lien Auctions in New JerseyRead the Press Release
A Pennsylvania corporation pleaded guilty today to participating in a conspiracy to rig bids for the sale of tax liens auctioned by municipalities throughout New Jersey, the Department of Justice announced.
A felony charge was filed today in the U.S. District Court for the District of New Jersey in Newark, against Crusader Servicing Corp., of Jenkintown, Pa. According to the felony charge, from at least as early as 1998 until September 2006, Crusader participated in a conspiracy to rig bids at auctions for the sale of municipal tax liens in New Jersey by agreeing to allocate among certain bidders which liens each would bid on. The department said that Crusader submitted bids in accordance with their agreements and purchased tax liens at collusive and non-competitive interest rates.
“The conspirators agreed to not compete with one another at these tax lien auctions, depriving struggling homeowners of a competitive interest rate,” said Scott D. Hammond, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program. “Today’s guilty plea demonstrates the Antitrust Division’s continuing efforts to prosecute those who manipulate the competitive process in order to harm home and property owners.”
The department said that the primary purpose of the conspiracy was to suppress and restrain competition to obtain selected municipal tax liens offered at public auctions at non-competitive interest rates. When the owner of real property fails to pay taxes on that property, the municipality in which the property is located may attach a lien for the amount of the unpaid taxes. If the taxes remain unpaid after a waiting period, the lien may be sold at auction. State law requires that investors bid on the interest rate delinquent homeowners will pay upon redemption. By law, the bid opens at 18 percent interest and, through a competitive bidding process, can be driven down to zero percent. If a lien remains unpaid after a certain period of time, the investor who purchased the lien may begin foreclosure proceedings against the property to which the lien is attached.
According to the court documents, Crusader conspired with others not to bid against one another at municipal tax lien auctions in New Jersey. Since the conspiracy permitted the conspirators to purchase tax liens with limited competition, each conspirator was able to obtain liens which earned a higher interest rate. Property owners were therefore made to pay higher interest on their tax debts than they would have paid had their liens been purchased in open and honest competition.
A violation of the Sherman Act carries a maximum penalty of $100 million criminal fine for corporations. The maximum fine for a Sherman Act violation may be increased to twice the gain derived from the crime or twice the loss suffered by the victims if either amount is greater than the statutory maximum.
Today’s plea is the 10th guilty plea resulting from an ongoing investigation into bid rigging or fraud related to municipal tax lien auctions. Eight individuals — Isadore H. May, Richard J. Pisciotta Jr., William A. Collins, Robert W. Stein, David M. Farber, Robert E. Rothman, Stephen E. Hruby and David Butler — and one company, DSBD LLC, have previously pleaded guilty as part of this investigation.
Today’s charge is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
The ongoing investigation is being conducted by the Antitrust Division’s New York Field Office and the FBI’s Atlantic City, N.J. office. Anyone with information concerning bid rigging or fraud related to municipal tax lien auctions should contact the Antitrust Division’s New York Field Office at 212-335-8000, visit www.justice.gov/atr/contact/newcase.htm or contact the FBI’s Atlantic City Resident Agency at 609-677-6400.Justice Department Requires Divestitures in Order for Standard Parking Corp. to Proceed with Its Acquisition of<br /> Central Parking Corp.Read the Press Release
WASHINGTON – The Department of Justice announced today that it will require Standard Parking Corporation and Central Parking Corporation to divest their interests in certain off-street parking facilities in 29 cities in 21 states in order to proceed with Standard’s acquisition of Central. The department said that without these divestitures, the combined company would have gained a dominant market share of off-street parking facilities in certain areas of each of the cities, resulting in higher prices and reduced service to motorists. The acquisition is valued at approximately $345 million.The department’s Antitrust Division filed a civil antitrust lawsuit today in the U.S. District Court for the District of Columbia to block the proposed acquisition. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive concerns alleged in the lawsuit.
“Consumers have benefited from lower parking prices because of competition between Standard and Central in many urban central business districts,” said Acting Assistant Attorney General Joseph Wayland in charge of the Department of Justice’s Antitrust Division. “These divestitures will ensure that consumers in the affected cities and states will receive better services.”
Standard and Central are the two largest parking management companies in the United States. The companies are head-to-head competitors in providing motorists with off-street parking services, such as in garages and lots. In its complaint, the department said that the companies compete on prices, including “early-bird” or evening specials, as well as on hours of operation, parking options, security and other terms. As a result of the competition between Standard and Central, consumers have benefitted through lower prices and better services. The proposed merger threatens to end that competition and would provide Standard with the ability to exercise market power by raising prices or reducing the quality of services offered for off-street parking services, the department said in its complaint.
The department’s complaint alleges that the proposed acquisition would lessen competition in certain areas in the central business districts (CBDs) of: Atlanta; Baltimore; Bellevue, Wash.; Boston; Charlotte, N.C.; Chicago; Cleveland; Columbus, Ohio; Dallas; Denver; Fort Myers, Fla.; Fort Worth, Texas; Hoboken, N.J.; Houston; Kansas City, Mo.; Los Angeles; Miami; Milwaukee; Minneapolis; Nashville, Tenn.; New Orleans; New York City (Bronx, Rego Park), N.Y.; Newark, N.J.; Philadelphia; Phoenix; Richmond, Va.; Sacramento, Calif.; and Tampa, Fla.
To remedy the harm, the proposed settlement requires Standard and Central to divest at least 107 parking facilities in the CBDs. The divestitures can be accomplished by selling the companies’ interests in the parking facilities to an approved buyer or by terminating the parking facility agreement or allowing it to expire. The facilities to be divested generate total annual revenues from consumers of about $85 million.Standard is a Chicago-based company which currently operates in 41 states and Washington, D.C., with approximately 2,200 parking facilities containing more than 1.2 million parking spaces. In 2011, Standard had total revenues of more than $729 million.
Central is a Nashville-based company which operates in 38 states, Washington D.C. and Puerto Rico, with approximately 2,200 parking facilities containing about 1 million parking spaces. It is privately held, with total revenues in 2011 in excess of $800 million.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Scott Scheele, Chief, Telecommunications and Media Enforcement Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 7000, Washington D.C. 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may approve the proposed settlement upon finding that it is in the public interest.
Individual Indicted in Louisiana for Impersonating an OSHA Employee to Conduct Fraudulent Hazardous Waste Safety Trainings During Gulf Oil Spill Clean upRead the Press Release
A 22-count federal indictment was unsealed today in federal court in New Orleans charging Connie M. Knight, 46, with impersonating a federal employee for the purpose of enticing people to pay her for fraudulent hazardous waste safety training, announced Ignacia S. Moreno, Assistant Attorney General of the Justice Department’s Environment and Natural Resources Division and Jim Letten, U.S. Attorney for the Eastern District of Louisiana. The indictment also charges Knight with possessing false federal identification documents, creating false federal identification documents and transferring false federal identification documents to her employees.
Knight, previously of Belle Chasse, La., was arrested by federal agents earlier today in Wiggins, Miss., where she currently resides. She was scheduled to appear in federal court in New Orleans at 2:00 p.m. today.
The indictment states that Knight impersonated an Occupational Safety and Health Administration (OSHA) “Master Level V Inspector and Instructor” by utilizing false OSHA credentials, a false OSHA email address, and various other means. Knight thereby enticed individuals to pay for fraudulent hazardous waste safety and awareness training under the pretense that they would get work helping to clean the Gulf.
In the wake of the Deepwater Horizon oil spill, many fisheries were closed, causing many fishermen in the Gulf region to seek other sources of employment, including as oil spill cleanup personnel. All cleanup personnel were required to receive hazardous waste safety training before working in contaminated areas due to dangers from the oil itself and cleanup materials.
According to the indictment, from August to December of 2010, it is estimated that Knight defrauded more than 1,000 individuals throughout the Eastern District of Louisiana. The indictment alleges that Knight created and used fraudulent OSHA credentials, along with numerous false diplomas and certifications, to convince individuals that she was an authorized trainer and that they would be able to procure lucrative cleanup work if they attended and paid for her hazardous waste training courses. Knight targeted members of the Southeast Asian communities in Southern Louisiana, many of whom neither read nor spoke English proficiently.
According to the indictment, in October of 2010, while impersonating an OSHA employee, Knight created false federal OSHA identification badges for others as well. Knight is charged with creating those additional false OSHA identification badges, as well as providing them to four residents of Southern Louisiana fishing communities whom she had hired as employees. The indictment states that Knight knew she had no authority to produce or transfer the false OSHA identification badges.
The charges of producing and transferring fraudulent federal identification documents each carry a maximum sentence of 15 years in prison and a fine of $250,000. The charge of possessing a fraudulent federal identification document carries a maximum sentence of one year in prison and a fine of $5,000. The 19 counts of falsely impersonating a federal employee each carry a maximum sentence of three years in prison and a fine of $250,000.
The allegations in the indictment are mere accusations and all persons are presumed innocent until and unless proven guilty beyond a reasonable doubt in a court of law.
This case is being investigated by the U.S. Department of Labor Office of Inspector General and the U.S. Environmental Protection Agency Criminal Investigation Division, with assistance from OSHA, the FBI, and investigators from the Florida Fish and Wildlife Conservation Commission and the Plaquemines Parish Sheriff’s office.
The case is being prosecuted by Patrick M. Duggan of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division and Emily Greenfield of the U.S. Attorney’s Office for the Eastern District of Louisiana.
Assistant Attorney General for the Tax Division Kathryn Keneally to Hold Pen and Pad Briefing ThursdayRead the Press Release
*******MEDIA ADVISORY*******
WASHINGTON – Assistant Attorney General for the Tax Division Kathryn Keneally will hold a pen and pad briefing regarding the department’s new directive on stolen identity refund fraud (SIRF) cases TOMORROW, SEPTEMBER 27, 2012, at 11:00 a.m. EDT.
WHO: Assistant Attorney General for the Tax Division
Kathryn Keneally WHAT: Pen and pad briefing on SIRF cases WHEN: THURSDAY, SEPTEMBER 27, 2012
11:00 a.m. EDT WHERE: Department of Justice
Room 4143
950 Pennsylvania Ave., N.W.
Washington, D.C.
OPEN PRESSNOTE: All media must present government-issued photo I.D. (such as a driver’s license) as well as valid media credentials. Media must enter the department at the visitor’s entrance on Constitution Avenue between Ninth and Tenth Streets. Media may begin arriving at 10:30 a.m. EDT. Press inquiries regarding logistics should be directed to the Office of Public Affairs at 202-514-2007.
25 September 2012
Taiwan Auto Lights Manufacturer Executive Pleads Guilty in Price-Fixing ConspiracyRead the Press Release
WASHINGTON – The vice chairman and second-highest ranking officer of a Taiwan aftermarket auto lights manufacturer pleaded guilty today for his participation 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.
Homy Hong-Ming Hsu was arrested on July 12, 2011, at Los Angeles International Airport and indicted for his participation in the conspiracy. According to a one-count felony superseding indictment filed the in U.S. District Court in San Francisco on Nov. 30, 2011, Hsu conspired with others to suppress and eliminate competition by fixing the prices of aftermarket auto lights. The department said that Hsu, vice chairman of Eagle Eyes Traffic Industrial Co. Ltd., participated in the conspiracy from as early as November 2001 until about September 2008. Eagle Eyes, its U.S. subsidiary E-Lite Automotive Inc., and Eagle Eyes’ highest-ranking officer, Chairman Yu-Chu Lin, aka David Lin, were also indicted for their participation in the conspiracy. Trial for Eagle Eyes and E-Lite is scheduled to begin on Oct. 29, 2012.
According to the indictment, 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 the conspiracy issued price announcements to customers in accordance with the jointly determined price structure, and collected and exchanged information on prices for the purpose of monitoring and enforcing adherence to the conspiracy. The department said that the conspirators held meetings in Taiwan and the United States.
“The Antitrust Division will continue to crack international price fixing cartels that harm American businesses and consumers,” said Joseph Wayland, Acting Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “Four corporations and five executives have been charged as a result of the Antitrust Division’s investigation into price fixing in the aftermarket auto lights industry.”
Of the five individuals, three have already pleaded guilty. Shiu-Min Hsu, the former chairman of Depo Auto Parts Industrial Co. Ltd, a Taiwan manufacturer of aftermarket auto lights, pleaded guilty on March 20, 2012, and is scheduled to be sentenced on Jan. 8, 2013. Polo Shu-Sheng Hsu, the highest-ranking officer of Maxzone Vehicle Lighting Corp., a U.S. distributor of aftermarket auto lights, pleaded guilty on March 29, 2011, served his sentence of 180 days in prison and paid a $25,000 criminal fine. Chien Chung Chen, aka Andrew Chen, the former executive vice president of Sabry Lee (U.S.A.) Inc., a second U.S. distributor of aftermarket auto lights, pleaded guilty on June 7, 2011. He is scheduled to be sentenced on Jan. 15, 2013.
In addition, of the four corporations, two have pleaded guilty. On Oct. 4, 2011, Sabry Lee pleaded guilty and was sentenced to pay a $200,000 criminal fine. On Nov. 15, 2011, Maxzone pleaded guilty and was sentenced to pay a $43 million criminal fine.Hsu is charged with violating the Sherman Act, which carries a maximum penalty of 10 years in prison and a $1 million criminal fine for individuals. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims, if either of those amounts is greater than the statutory maximum fine.
This case is part of an 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.
Justice Department Sues Owners and Manager of Rental Homes in North Carolina for Engaging in Race DiscriminationRead the Press Release
The Justice Department announced today that it has filed a Fair Housing Act lawsuit against the owners and manager of approximately two dozen rental homes in Washington, N,C., alleging that the manager, William I. Cochran III, discriminated against African-American tenants.
The complaint, filed in the U.S. District Court for the Eastern District of North Carolina, names Cochran and three related corporate entities – EKP LLC, WRC LLC and Emlan Properties LLC – that own or owned the various properties managed by Cochran. The complaint alleges that Cochran delayed or refused to perform maintenance or repairs at properties rented by African-Americans and refused to credit them for repairs they paid for or made themselves; verbally harassed African-American tenants with racial slurs and epithets, having made statements indicating that he disfavored African-American tenants; and threatened, harassed and retaliated against African-American tenants who resisted his discriminatory housing practices.
“No American should be subjected to substandard housing conditions because of his or her race,” 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 individuals who seek basic maintenance and repairs to be free from discrimination, harassment, or retaliation.”
“Racial discrimination will not be tolerated in North Carolina,” said Thomas G. Walker, U.S. Attorney for the Eastern District in North Carolina. “When we have evidence demonstrating that federal law has been broken, we will take action against the violators.”
The case began when a former tenant at one of Cochran’s properties contacted the Justice Department to report Cochran’s conduct. The department conducted an extensive investigation and then filed today’s lawsuit, which seeks an order prohibiting the defendants from engaging in future unlawful discrimination, and requiring the defendants to pay monetary damages to victims of their discrimination and civil penalties to the government.
Fighting illegal discrimination in housing is a top priority of the Justice Department. 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.justice.gov/crt . Individuals who believe that they have been victims of housing discrimination or have information related to this lawsuit can call the Housing Discrimination Tip Line at 1-800-896-7743, email the Justice Department at [email protected] or contact the Department of Housing and Urban Development at 1-800-669-9777.
Related Materials:
Complaint
Department of Justice Awards Funding to Enhance Communities’ Ability to Improve Safety in Distressed NeighborhoodsRead the Press Release
Attorney General Eric Holder and the Department of Justice’s Bureau of Justice Assistance (BJA) Director Denise E. O’Donnell today announced more than $11 million in awards to address neighborhood-level crime in 15 locations nationwide. The awards, administered through the department’s new Byrne Criminal Justice Innovation (BCJI) program, will target locations or neighborhoods with significant levels of crime compared to the overall jurisdiction. Today’s announcement includes a $600,000 award to the Center for Court Innovation (CCI) focused on the Brownsville neighborhood of Brooklyn, New York. BJA Director O’Donnell was joined by U.S. Attorney for the Eastern District of New York Loretta E. Lynch, New York City Police Commissioner Raymond W. Kelly, and Kings County District Attorney Charles J. Hynes in making the announcement.
BCJI is a part of the Obama Administration’s larger Neighborhood Revitalization Initiative (NRI) that helps local and tribal communities develop place-based, community-oriented strategies with coordinated federal support to change neighborhoods of distress into neighborhoods of opportunity. BCJI is a data driven approach, leveraging research and innovation to identify the drivers of crime in a location and to develop multi-faceted strategies to reduce it. BCJI will also develop the ability – through training and technical assistance - of the community to more effectively target these issues. Led by the Administration’s Domestic Policy Council, the NRI brings together the Departments of Education, Housing and Urban Development, Justice, Health and Human Services and Treasury to align federal programs supporting neighborhood revitalization and to implement interagency pilot programs.
“While overall crime rates have continued to decline nationwide, some neighborhoods have experienced troubling increases in specific types of criminal activity which is why the Department and our partners are providing additional resources to communities that need them the most,” said Attorney General Holder. “With today’s announcement, we reaffirm our commitment to relying on comprehensive, data-driven approaches for ensuring public safety – and investing in innovative strategies for protecting the American people from crime.”
Earlier this year, BJA awarded, through an agreement with the Department of Housing and Urban Development (HUD), $2 million in Public Safety Enhancement grants to HUD’s Choice Neighborhood grantees in Boston, Chicago, New Orleans and San Francisco. These enhancement grants, also coordinated through NRI, are helping to transform public and assisted housing projects to respond to serious, pervasive public safety concerns in distressed neighborhoods.
“Community safety plays a vital role in neighborhood revitalization,” said OJP Acting Assistant Attorney General Mary Lou Leary. “These awards are targeting persistently distressed neighborhoods that require interconnected solutions in order to resolve their interconnected problems.”
BCJI awards are made to applicants consisting of a cross-sector partnership, including units of local government, criminal and juvenile justice agencies, non-profit organizations and federally recognized Indian tribal governments. This year, BCJI selected the Local Initiatives Support Corporation (LISC) to serve as the national training and technical assistance provider for the new BCJI grantees. LISC will assist with an analysis of the crime in each community, engage residents and provide ongoing support to ensure the sites effectively use data, research and innovation to develop a comprehensive crime strategy.
“In times of limited resources, community leaders need tools and information about crime trends in their jurisdiction and support to assess, plan and implement the most effective use of criminal justice resources to address priority crime issues,” said BJA Director O’Donnell. “BCJI incorporates research and effective enforcement and intervention strategies as part of a comprehensive approach to help the community build protective factors to provide a long-term deterrence to future crime.”
The Brownsville BCJI project is called The Brownsville Anti-Violence Project and is a partnership that includes the Center for Court Innovation; the King’s County District Attorney’s Office; the New York City Police Department; the U.S. Attorney’s Office of the Eastern District of New York: the New York State Department of Corrections and Community Supervision; the Pitkin Avenue Business Improvement District; the Brownsville Partnership (consortium of service providers); and local residents.
For more information on BJA’s Byrne Criminal Justice Innovation Program, please visit: www.bja.gov.
For more information about the Neighborhood Revitalization Initiative, please visit: www.whitehouse.gov/sites/default/files/nri_description.pdf.
OJP is headed by Acting Assistant Attorney General Mary Lou Leary and provides federal leadership in developing the nation’s ability 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. For more information about OJP and its components, please visit: www.ojp.gov.
Biglari Holdings Inc. to Pay $850,000 Civil Penalty for Violating<br /> Antitrust Premerger Notification RequirementsRead the Press Release
WASHINGTON – San Antonio-based Biglari Holdings Inc. will pay an $850,000 civil penalty to settle charges that it violated premerger reporting and waiting requirements when it acquired Cracker Barrel voting securities, the Department of Justice announced today.The Justice Department’s Antitrust Division, at the request of the Federal Trade Commission, filed a civil antitrust lawsuit today in U.S. District Court in Washington, D.C., against Biglari Holdings for violating the notification requirements of the Hart-Scott-Rodino (HSR) Act of 1976. At the same time, the department filed a proposed settlement that, if approved by the court, will settle the charges.
According to the complaint, Biglari Holdings failed to comply with the antitrust premerger notification requirements of the HSR Act before acquiring voting securities of Cracker Barrel Old Country Store Inc. in June of 2011. Although the HSR Act exempts from its premerger notification requirements certain acquisitions “solely for the purpose of investment,” Biglari Holdings’ acquisitions were not made solely for the purpose of investment, the department said. The complaint alleges that Biglari Holdings was in violation of the HSR Act from June 8, 2011 through Sept. 22, 2011.
The Hart-Scott-Rodino Act of 1976, an amendment to the Clayton Act, imposes notification and waiting period requirements on individuals and companies over a certain size before they consummate acquisitions resulting in holding stock or assets above a certain value, which was $66 million in 2011 and is currently $68.2 million.
Federal courts can assess civil penalties for premerger notification violations under the HSR Act in lawsuits brought by the Department of Justice. For a party in violation of the HSR Act the maximum civil penalty is $16,000 a day.
24 September 2012
Subsidiary of Tyco International Ltd. Pleads Guilty, Is Sentenced for Conspiracy to Violate Foreign Corrupt Practices ActRead the Press Release
WASHINGTON – Tyco International Ltd. – together with a subsidiary that pleaded guilty this morning to a criminal charge for conspiring to violate the Foreign Corrupt Practices Act (FCPA) – has agreed to pay more than $26 million to resolve the conspiracy charge with the Department of Justice and charges with the U.S. Securities and Exchange Commission (SEC), announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney for the Eastern District of Virginia Neil H. MacBride.As part of the more than $26 million, Tyco – a company based in Switzerland that manufactures and sells products related to security, fire protection and energy – has agreed to pay a $13.68 million penalty for falsifying books and records in connection with payments by its subsidiaries to government officials in various countries in order to obtain and retain business .
Tyco Valves & Controls Middle East Inc. (TVC ME) – an indirect, wholly owned subsidiary of Tyco that sold and marketed valves and other industrial equipment throughout the Middle East for the oil, gas, petrochemical, commercial construction, water treatment and desalination industries – pleaded guilty this morning before U.S. District Judge Claude M.Hilton for conspiring to violate the anti-bribery provisions of the FCPA. According to the criminal information to which TVC ME pleaded guilty, the company paid bribes to officials employed by Saudi Aramco, an oil and gas company controlled and managed by the government of the Kingdom of Saudi Arabia, in order to obtain contracts with Saudi Aramco.
At the conclusion of the plea proceeding, the court sentenced TVC ME to pay a $2.1 million fine, which is included as part of the $13.68 million penalty.
“Today, a Tyco subsidiary pleaded guilty to bribing officials of state-owned entities in various countries to score valuable petroleum contracts and, with Tyco International, agreed to pay nearly $14 million in penalties,” said Assistant Attorney General Breuer. “Together with the SEC, we are leading a fight against corruption around the globe.”
“For more than 10 years, various Tyco entities bribed foreign officials and cooked the books to hide the payments,” said U.S. Attorney MacBride. “The Eastern District of Virginia has a strong partnership working with the Criminal Division’s Fraud Section on FCPA cases and is aggressively using venue provisions to hold FCPA violators accountable for their conduct.”
As part of the settlement, the department entered into a non-prosecution agreement (NPA) with Tyco. According to the NPA, a number of Tyco’s subsidiaries made payments, both directly and indirectly, to government officials in order to obtain and retain business with private and state-owned entities, and falsely described the payments in Tyco’s corporate books, records and accounts as legitimate charges. From 1999 to 2009, Tyco knowingly conspired to falsify its books and records in connection with these payments.
In addition to the monetary penalty, Tyco and TVC ME also agreed to cooperate with the department, to report periodically to the department concerning the companies’ compliance efforts, and to continue to implement an enhanced compliance program and internal controls designed to prevent and detect FCPA violations.
The agreement acknowledges Tyco’s timely, voluntary and complete disclosure, its cooperation – including a global internal investigation concerning bribery and related misconduct – and its extensive remediation. That remediation includes the implementation of an enhanced compliance program, the termination of employees responsible for the improper payments and falsification of books and records, the severing of contracts with the responsible third-party agents and the closing of subsidiaries due to compliance failures.
In the parallel civil proceedings, Tyco consented with the SEC to a proposed final judgment that orders the company to pay $10,564,992 in disgorgement and $2,566,517 in prejudgment interest – which, together with the Department of Justice penalty, totals more than $26 million.
The case is being prosecuted by Trial Attorneys Kathleen M Hamann and Daniel S. Kahn of the Criminal Division’s Fraud Section, and Assistant U.S. Attorney Charles F. Connolly of the Eastern District of Virginia. The case was investigated by the FBI.
The Justice Department acknowledges and expresses its appreciation for the significant assistance provided by the SEC’s Division of Enforcement.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.Justice Department Intervenes to Protect Prisoners from Life-Threatening Conditions at Orleans Parish Prison in New OrleansRead the Press Release
The Justice Department announced today that it has moved to intervene in a class action lawsuit regarding conditions of confinement at the Orleans Parish Prison (OPP), a pre-trial and correctional facility in New Orleans. The litigation seeks to address conditions that violate the U.S. Constitution and Title VI of the Civil Rights Act of 1964. The department seeks remedies to correct inadequate medical, mental health care and suicide prevention practices; failures to protect prisoners from physical and sexual violence; deficiencies in environmental health and safety; and inadequate language access services for Latino prisoners with limited English proficiency (LEP).
The United States seeks to join as plaintiff-intervenors in Jones v. Gusman, class action litigation that the Southern Poverty Law Center has brought on behalf of the men, women and youth confined to OPP, to protect them from abusive and unconstitutional conditions of confinement. Both Sheriff Marlin Gusman, who oversees OPP, and the plaintiffs to the class action support the United States’ motion to intervene, to achieve a single, comprehensive resolution of the class action and the United States’ investigation of OPP. The department’s investigation, initiated in February 2008, was brought under the Civil Rights of Institutionalized Persons Act and language issues under Title VI.
“The Justice Department has longstanding, serious concerns about the conditions at the Orleans Parish Prison. The constitutional violations we found affect the health and safety of prisoners, corrections officers and the community,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “Transforming the operation of the prison is a key component of the overall reform of the criminal justice system in New Orleans. Although we have moved to intervene in the pending litigation, we are hopeful that we can reach a negotiated resolution of this case in the near future, and put in place a comprehensive blueprint for sustainable reform. We will continue to work in an expeditious fashion with the sheriff, the city of New Orleans and the private plaintiffs on this important case.”
“The government’s intervention in this case will facilitate much needed reforms at OPP in the fastest and most efficient manner,” said James Letten, U.S. Attorney for the Eastern District of Louisiana. “The men, women and youth at OPP will benefit greatly from the comprehensive reform sought in this important intervention.”
The department issued findings in October 2009 and April 2012. Throughout that time, the department was engaged in discussions with the Sheriff to develop a set of comprehensible and sustainable reforms. Necessary reforms will require improved policies, procedures, staff training and supervision to ensure that OPP protects prisoners from violence and sexual assault by staff and other prisoners; provides adequate mental health and medical care, including suicide prevention; provides language services to LEP prisoners; and provides adequate fire and environmental safety.
The department has been working for some time with the OPP and community stakeholders on this negotiated settlement and is confident that it will serve as a comprehensive blueprint for sustainable reform. The department’s work with both OPP and the New Orleans Police Department (NOPD) reflects its continuing commitment to reforming the criminal justice system in New Orleans and across the country.
Additional information about the Special Litigation Section of the Justice Department’s Civil Rights Division can be found at www.usdoj.gov/crt/split/index.html .
21 September 2012
Massachusetts Tax Fraud Promoter Sentenced to 5 Years in Prison for Conspiracy to Obstruct and Impede the IrsRead the Press Release
A federal judge in Worcester, Mass., sentenced Catherine June Floyd today to 60 months in prison for conspiring to defraud the United States and for obstructing the Internal Revenue Service (IRS), the Justice Department and IRS announced. U.S. District Judge F. Dennis Saylor also ordered Floyd to pay restitution in the amount of $3 million.
On April 2, 2012, a federal jury convicted Catherine Floyd and William Scott Dion, both of Sanbornville, N.H., and Charles Adams, of Norwood, Mass., for conspiracies to defraud the United States through the promotion and use of multiple tax fraud schemes. The jury convicted all three of conspiracy to defraud the IRS by promoting an “under the table” payroll scheme. Dion and Floyd were also convicted for conspiracy to defraud the IRS through the use of an “underground warehouse banking” scheme designed to conceal customer income and assets from the IRS. Floyd and Dion were also convicted separately for corruptly endeavoring to obstruct the IRS’s ability to determine their own income. Adams was separately convicted of tax evasion.
On Sept. 6, 2012, Judge Saylor sentenced defendant Dion to 84 months in prison, and ordered him to pay $3 million in restitution as well.
According to the evidence presented at trial, Floyd, Dion and Adams ran a payroll tax scheme in order to pay employees “under the table” without properly accounting for, withholding, and paying over to the IRS the payroll taxes required by law. The three promoted the payroll scheme to employers and individuals who wanted to avoid payment of employer payroll taxes and individual payroll taxes. They ran the payroll scheme under three different names: Contract America, Talent Management and New Way Enterprises. Approximately 150 individuals subscribed to the payroll scheme and in excess of $2.5 million in unreported wages and compensation were paid through the system.
The evidence at trial also established that Floyd and Dion conspired to defraud the United States by promoting and operating an “underground warehouse banking” scheme which helped subscribers conceal income and assets from the IRS. According to the evidence, the warehouse scheme operated under three different names: Your Virtual Office, Office Services and Calico Management. As part of the warehouse banking scheme, the defendants maintained accounts at several banks and used the accounts to deposit and commingle business receipts and other funds received from subscribers in order to mask the true ownership of the funds. According to evidence presented at trial, more than $28 million in deposits were made into the various bank accounts used in the scheme.
In August 2009, the three defendants were indicted with four other individuals relating to the promotion and use of these schemes. On Dec. 9, 2011, prior to trial, Gail and Myron Thorick of West Warwick, R.I., pleaded guilty to conspiring to defraud the United States by helping operate the “warehouse banking” scheme, and for filing false tax returns. On that same date, Gary Alcock pleaded guilty to conspiracy by using the payroll scheme, as well as to tax evasion and willful failure to file tax returns. On Jan. 24, 2012, Kenneth Scott Alcock pleaded guilty to conspiracy relating to the payroll scheme and to one count of tax evasion. All four defendants are awaiting sentencing.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, and Carmen M. Ortiz, U.S. Attorney for the District of Massachusetts, commended the efforts of special agents of IRS - Criminal Investigation, who investigated the case, and Tax Division Assistant Chief John N. Kane, former Tax Division Trial Attorney Jeffrey Shih, and Assistant U.S. Attorney Victor A. Wild, who prosecuted the case.
Alcatel-lucent Subsidiary Agrees to Pay U.S. $4.2 Million to Settle False Claims Act AllegationsRead the Press Release
WASHINGTON – An Alcatel-Lucent subsidiary, Lucent Technologies World Services Inc. (LTWSI), has agreed to pay the United States $4.2 million to settle False Claims Act allegations that it submitted misleading testing certifications to the Army in connection with the design, construction and modernization of Iraq’s emergency communications system, the Department of Justice announced today. Alcatel-Lucent is a global telecommunications provider.
In March 2004, the U.S. Army awarded LTWSI a $250 million contract to build the Advanced First Responder Network (AFRN), a 911 emergency response and first responder communications system designed to enable Iraqis to summon police, fire and medical assistance in emergencies. Today’s settlement resolves allegations that LTWSI submitted claims for payment for equipment, services and contract performance award fees under the AFRN contract based upon inaccurate certifications that LTWSI, between January and July 2005, had performed and successfully completed certain testing of AFRN radio transmission sites, as well as validation of the network as a whole, to ensure the network’s proper operation prior to acceptance by the United States and transfer to the Iraqi government.
“The integrity of our public contracting system is a matter of paramount concern to the Department of Justice, especially where contractors have been engaged to supply critical support for the work of stabilizing Iraq and Afghanistan,” said Stuart F. Delery, Acting Assistant Attorney General for the Department of Justice’s Civil Division. “The department will seek to recover losses to the American taxpayer when a contractor has claimed money to which it was not entitled.”
“The United States must be able to count upon government contractors to seek payment only for services performed in conformance with their contractual obligations. That is particularly true of contractors performing work for the United States in ‘hot spots’ around the globe where verification of invoiced work can be both difficult and dangerous,” said Jenny Durkan, the U.S. Attorney for the Western District of Washington. “LTWSI’s internal procedures on the AFRN project clearly should have been more robust in this instance.”
The settlement resolves a whistleblower suit filed under the False Claims Act in December 2008, by Geoffrey Willson, LTWSI's former contract manager for the project. The False Claims Act permits private parties to sue on behalf of the United States for submission of false claims to the government and to share in any recovery. Willson will receive $758,000 as his statutory share of today’s settlement.
This matter was handled jointly by the U.S. Attorney’s Office for the Western District of Washington and the Department of Justice Civil Division’s Commercial Litigation Branch in Washington, D.C. Investigative support was provided by the Department of Defense Inspector General’s Seattle Resident Agency of the Defense Criminal Investigative Service. The Defense Contract Audit Agency and Army Criminal Investigation Command also provided investigative support.
The claims settled by this agreement are allegations only and do not constitute a determination of liability. The lawsuit is captioned United States ex rel. Geoffrey K. Willson v. Alcatel-Lucent, a foreign corporation, et al., Docket No. C08-1812 (W.D.WA).
20 September 2012
Taiwan-Based AU Optronics Corporation Sentenced to Pay <br /> $500 Million Criminal Fine for Role in LCD Price-Fixing ConspiracyRead the Press Release
WASHINGTON — AU Optronics Corporation, a Taiwan-based liquid crystal display (LCD) producer, was sentenced today in U.S. District Court in San Francisco to pay a $500 million criminal fine for its participation in a five-year conspiracy to fix the prices of thin-film transistor LCD panels sold worldwide, the Department of Justice announced. Its American subsidiary and two former top executives were also sentenced today. The two executives were sentenced to serve prison time and to pay criminal fines for their roles in the conspiracy. The $500 million fine matches the largest fine imposed against a company for violating the U.S. antitrust laws.
Today’s sentencing took place before Judge Susan Illston. Along with the criminal fine, AU Optronics Corporation was also sentenced to print advertisements in three major trade publications in the United States and Taiwan acknowledging its convictions and punishments and the remedial steps it has taken as a result of its conviction. The company and its American subsidiary, AU Optronics Corporation America, were also placed on probation for three years, required to adopt an antitrust compliance program and to appoint an independent corporate compliance monitor.
“This long-running price-fixing conspiracy resulted in every family, school, business, charity and government agency who bought notebook computers, computer monitors and LCD televisions during the conspiracy to pay more for these products,” said Scott D. Hammond, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program. “The Antitrust Division will continue to pursue vigorously international cartels that target American consumers and rob them of their hard earned money.”
Former AU Optronics Corporation president Hsuan Bin Chen was sentenced to serve three years in prison and to pay a $200,000 criminal fine. Former AU Optronics Corporation executive vice president Hui Hsiung was also sentenced to serve three years in prison and to pay a $200,000 criminal fine.
“The number of criminal antitrust cases filed has significantly increased over the last five years, and so has the dedication of FBI resources to these important investigations. The FBI remains committed to thwarting fraud and corruption in the United States and around the world. To that end, we have agents, analysts and professional staff in all of our 56 Field Offices and 63 LEGATs that are committed to fighting these crimes wherever they are found and at whatever level they are found. I would like to commend the employees of the FBI’s San Francisco Field Office and the Department of Justice Antitrust Division, for their fine work on this very important antitrust investigation. This team has devoted countless hours to the investigation and I appreciate their devotion to the mission,” said Assistant Director Ronald T. Hosko, of the FBI’s Criminal Investigative Division.
The companies and former executives were found guilty on March 13, 2012, following an eight-week trial. The indictment charged that AU Optronics Corporation participated in the worldwide price-fixing conspiracy from Sept. 14, 2001, to Dec. 1, 2006, and that its subsidiary joined the conspiracy as early as spring 2003. The jury found that the convicted companies and former executives fixed the prices of LCD panels sold into the United States. The prices were fixed during monthly meetings with their competitors secretly held in hotel conference rooms, karaoke bars and tea rooms around Taiwan. LCD panels are used in computer monitors and notebooks, televisions and other electronic devices. By the end of the conspiracy, the worldwide market for LCD panels was valued at $70 billion annually. The LCD price-fixing conspiracy affected some of the largest computer manufacturers in the world, including Hewlett Packard, Dell and Apple.
Including today’s sentences, eight companies have been convicted of charges arising out of the department’s ongoing investigation and have been sentenced to pay criminal fines totaling $1.39 billion. All together, 22 executives have been charged. Including today’s sentences, 12 executives have been convicted and have been sentenced to serve a combined total of 4,871 days in prison.
Today’s charges are the result of a joint investigation by the Department of Justice Antitrust Division’s San Francisco Field Office and the FBI in San Francisco. Anyone with information concerning illegal conduct in the LCD 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 .Jury Convicts 16 Defendants on Federal Hate Crimes Charges for Religiously-Motivated Assaults on Members of Amish CommunityRead the Press Release
A jury in Cleveland today convicted 16 people, all residents of Ohio, of federal hate crimes arising out of a series of religiously-motivated assaults on practitioners of the Amish religion, the Justice Department announced.
The convictions stem from a series of separate hate-crime assaults that occurred in four Ohio counties between September and November 2011. In each assault, defendants forcibly removed beard and head hair from practitioners of the Amish faith with whom they had ongoing religious disputes. In three of these hate-crime assaults, defendants invaded the homes of these practitioners and restrained their movements while shearing their hair, causing pain and other physical injuries. The manner in which Amish men wear their beards and Amish women wear their hair are symbols of their faith, according to trial testimony.
Samuel Mullet Sr., 66; Johnny S. Mullet, 39; Daniel S. Mullet, 38; Levi F. Miller, 54; Eli M. Miller, 32; Emanuel Shrock, age unknown; Lester Miller, 37; Anna Miller, age unknown; Linda Shrock, age unknown; Emma J. Miller, age unknown; Kathryn Miller, age unknown; and Lovina Miller, age 32, all of Bergholz, Ohio; Raymond Miller, 27; Freeman Burkholder, 31; Elizabeth A. Miller, age unknown; and Kathryn Miller, age unknown, all from Irondale, Ohio; and Lester Mullet, 27, of Hammondsville, Ohio, were found guilty of conspiring to violate the Matthew Shepard-James Byrd, Jr. Hate Crimes Prevention Act, which prohibits any person from 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 jury also convicted various groups of defendants with four hate crime counts against eight specific victims, and found that such hate crimes involved kidnapping. The jury also convicted Samuel Mullet Sr., Lester Mullet and Eli Miller with concealing or attempting to conceal various items of tangible evidence. Finally, the jury also convicted Sam Mullet of making false statements to the FBI.
Judge Dan Aaron Polster scheduled a sentencing hearing on Jan. 24, 2013. The defendants face terms of up to life in prison.
“The violent and offensive actions of these defendants, which were aimed at beliefs and symbols held sacred by this country's Amish citizens, are an affront to religious freedom and tolerance, which are core values protected by our Constitution and our civil rights laws,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “Those laws prohibit the use of violence to settle religious differences and the Department of Justice and the Civil Rights Division will vigorously enforce those laws.”
Samuel Mullet Sr., is the Bishop of the Amish community in Bergholz, Ohio, while the remaining defendants are all members of that community. Mullet Sr., exerted control over the Bergholz community by taking the wives of other men into his home, and by overseeing various means of disciplining community members, including corporal punishment, according to trial testimony.
As a result of religious disputes with other members of the Ohio Amish community, the defendants planned and carried out a series of assaults on their perceived religious enemies. The assaults involved the use of hired drivers, either by the defendants or the alleged victims, because practitioners of the Amish religion do not operate motor vehicles. The assaults all entailed using scissors and battery-powered clippers to forcibly cut or shave the beard hair of the male victims and the head hair of the female victims, according to the indictment.
During each assault, the defendants restrained and held down the victims. During some of the assaults, the defendants injured individuals who attempted to intervene to protect or rescue the victims. Following the attacks, some of the defendants participated in discussions about concealing photographs and other evidence of the assaults, according to evidence presented at trial.
“From day one, this case has been about the rule of law and defending the right of people to worship in peace,” said Steven Dettelbach, U.S. Attorney for the Northern District of Ohio. “Our nation was founded on the bedrock principle that everyone is free to worship how they see fit. Violent attempts to attack this most basic freedom have no place in our country.”
“This case is an excellent example of cooperation between the many law enforcement agencies that investigated these crimes, along with the prosecution team from the U.S. Attorney’s Office and the Department of Justice,” said Stephen Anthony, Special Agent in Charge of the FBI – Cleveland Field Office. “The FBI is committed to investigati ng hate crimes, including those perpetrated against people motivated by bias toward religion as in this case, or other areas protected by our civil rights statutes.”
This case was investigated by the Cleveland Division of the FBI and was prosecuted by Assistant U.S. Attorneys Thomas Getz and Bridget M. Brennan of the U.S. Attorney’s Office for the Northern District of Ohio and Deputy Chief Kristy Parker of the Justice Department’s Civil Rights Division. The prosecutor’s and sheriff’s offices from Holmes, Carroll and Jefferson counties also provided significant assistance in the investigation and prosecution of this case.
Guam Bar Owner Sentenced to Life in Prison for Sex Trafficking and Related CrimesRead the Press Release
Song Ja Cha, 70, a bar owner in Guam, was sentenced to life in prison today for her involvement in a sex trafficking scheme to force young women and one juvenile girl into prostitution, the Department of Justice announced. Cha was also ordered to pay $200,000 in restitution to the victims in this case as well as a $10,000 fine.
On Feb. 17, 2011, a federal jury in Guam found Cha guilty on all 20 counts of an indictment that charged her with sex trafficking, conspiracy to commit sex trafficking, coercion and enticement to travel in interstate or foreign commerce for prostitution and transportation of a minor for prostitution. The trial lasted eight days.
According to court documents, from 2004 through January 2008, Cha and others in the conspiracy recruited and enticed approximately 10 victims to come to Guam from the island of Chuuk in the Federated States of Micronesia. The victims were largely poor, young and uneducated. Cha lured the young women and one 16-year-old girl to Guam by promising them legitimate employment in a restaurant or store. In actuality, Cha was the proprietor of Blue House Lounge, a bar that included approximately six VIP rooms offering commercial sex.
According to evidence presented in court, Cha and her co-conspirators compelled the victims to work in the VIP rooms for 12 to 14 hours a day for the financial benefit of the conspiracy. Upon the victims’ arrival to the Blue House Lounge, Cha stripped the young women of their passports, clothing and identities. Cha then used a variety of means to compel the victims to engage in prostitution, including physical assaults, threats of arrest, manipulation of debt, withholding food and restricted access to the outside world. The victims testified that they were terrified of Cha and her co-conspirators, and that Cha used the fact that police officers frequented the lounge to make the victims believe that she was “connected” and could have them arrested and jailed.
“The sexual exploitation of vulnerable individuals is an affront to fundamental rights and will not be tolerated in our country. The defendant preyed on the hopes and dreams of these young victims, forcing them into a life of prostitution,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Department of Justice is committed to vigorously prosecuting the trafficking of human beings to uphold the rights of those held in modern-day slavery, whether for labor or for sexual exploitation.”
“Human traffickers trick, lie and coerce young women with a promise of work in a legitimate job,” said Alicia Limtiaco, U.S. Attorney for the District of Guam and the Northern Mariana Islands. “In reality, these young women lose their freedom and are horribly demeaned by the sexual acts that they are forced to perform. Defendant Cha preyed on vulnerable victims and used threats and abuse to force them into prostitution. The jury’s verdict makes clear that sex trafficking schemes will not be tolerated. We will continue to find traffickers and hold them accountable for their crimes.”
The Department of Justice has identified human trafficking prosecutions as a top priority.
This case was investigated by special agents of U.S. Immigration and Customs Enforcement and the Guam Police Department. This case was prosecuted by trial attorneys Jared Fishman and Shan Patel of the Justice Department’s Civil Rights Division Criminal Section with assistance from Assistant U.S. Attorney Rosetta San Nicolas and the U.S. Attorney’s Office for Guam and the Northern Mariana Islands.
To report trafficking crimes, please call the Department of Homeland Security Tip Line at 1-866-347-2423.
Five Individuals Charged in Detroit for Alleged Roles in $24.7 Million Medicare Fraud SchemeRead the Press Release
WASHINGTON – Five individuals were charged in court documents unsealed today in the Eastern District of Michigan for their participation in a Medicare fraud scheme involving purported home health and psychotherapy services, announced the Department of Justice, the FBI and the Department of Health and Human Services (HHS).
According to court documents, the scheme allegedly involved a total of more than $24.7 million in fraudulent claims submitted to Medicare for purported home health care and psychotherapy services that were medically unnecessary and/or never provided.
Court documents allege that the defendants are operators, employees and marketers associated with home health care and psychotherapy clinics operating in and around Detroit. Defendants charged in court documents unsealed today include: Mohammed Sadiq, 65, Troy, Mich.; Jamella Al-Jumail, 23, of Brownstown, Mich.; Firas Alky, 40, of Shelby Township, Mich.; Clarence Cooper, 53, of Detroit; and Beverly Cooper, 58, of Detroit.
Four defendants charged in the superseding indictment were previously charged and arrested in May 2012 for their roles in the scheme. Defendants previously charged include: Sachin Sharma, 36, of Shelby Township; Dana Sharma, 29, of Shelby Township; Abdul Malik Al-Jumail, aka Tony, 52, of Brownstown; Felicar Williams, 49, of Dearborn, Mich.
The superseding indictment charges all defendants with one count of conspiracy to commit health care fraud; Sachin Sharma with five counts of health care fraud; Sachin Sharma, Abdul Malik Al-Jumail, Williams, Sadiq, Alky and Clarence Cooper with one count of conspiracy to pay and receive health care kickbacks; and Jamella Al-Jumail with one count of destruction of records in a federal investigation. The superseding indictment also seeks forfeiture from all defendants.
According to the superseding indictment, from January 2007 through April 2012, the defendants operated a large network of purported home health care and psychotherapy companies in the Detroit area through which they conspired to defraud Medicare.
According to court documents, Sachin Sharma, Dana Sharma, Abdul Malik Al-Jumail, Williams, Jamella Al-Jumail, Sadiq, Alky and other alleged co-conspirators incorporated home health care, psychotherapy and other medical service companies to carry out the scheme, including Reliance Home Care, LLC; First Choice Home Health Care Services Inc.; Associates in Home Care Inc.; Haven Adult Day Care Center LLC; Swift Home Care LLC; ABC Home Care Inc.; Accessible Home Care Inc.; and Be Well Home Care LLC. The defendants, along with co-conspirators, allegedly submitted Medicare enrollment applications to permit these companies to bill Medicare. Sachin Sharma, Abdul Malik-Al-Jumail, Sadiq, Alky and others allegedly paid kickbacks and bribes to recruiters, including Williams and Clarence Cooper, to obtain Medicare beneficiaries’ information, which could be used to fraudulently bill Medicare for purported services provided by the companies they operated and controlled. The defendants then allegedly caused these companies to bill Medicare for home health and psychotherapy services, even though these services were not medically necessary and were often not provided.
According to the superseding indictment, the defendants caused Reliance, First Choice, Associates, Haven, Swift, ABC, Accessible and other home health, psychotherapy and medical services companies to submit approximately $24.7 million in claims to Medicare for services that were medically unnecessary and/or not provided. In addition, Jamella Al-Jumail is charged with destroying records relating to Accessible’s Medicare billings upon learning of the May 2012 arrest of Abdul Malik Al-Jumail, her co-conspirator and father.
Clarence and Beverly Cooper, Sadiq and Jamella Al-Jumail were arrested yesterday.
The case is being prosecuted by Fraud Section Assistant Chief Gejaa T. Gobena and Trial Attorney William G. Kanellis. The investigations were conducted jointly by the FBI and HHS-OIG, as part of the Medicare Fraud Strike Force, supervised by the U.S. Attorney's Office for the Eastern District of Michigan and the Criminal Division's Fraud Section.
Since its inception in March 2007, strike force operations in nine locations have charged more than 1,330 defendants who collectively have billed the Medicare program for more than $4 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, go to: www.stopmedicarefraud.gov.
Detroit-Area Doctor Charged for Role in Alleged $40 Million Medicare Fraud SchemeRead the Press Release
WASHINGTON – A Detroit-area doctor was charged and arrested today in the Eastern District of Michigan for his alleged leading role in a $40 million Medicare fraud scheme involving physician home visits and home health services, announced the Department of Justice, the Department of Health and Human Services (HHS), the FBI and the HHS-Office of Inspector General (OIG). In addition to the arrest, law enforcement agents executed search warrants at three locations and seizure warrants for three bank accounts related to the scheme.
According to a criminal complaint unsealed today in U.S. District Court in Detroit, Dr. Hicham Elhorr, 45, masterminded a $40 million scheme involving the submission of fraudulent claims submitted to Medicare for services that were medically unnecessary and/or never provided through House Calls Physicians (HCP), a physician home visiting service he owned and operated. Elhorr allegedly submitted claims through HCP for physician home visits for patients who were never seen and for visits conducted by doctors who were not licensed. The complaint alleges Elhorr submitted claims to Medicare for physician home visits purportedly rendered when he was out of the country, when beneficiaries were hospitalized or when the beneficiary was dead.
Elhorr is also alleged to have referred Medicare beneficiaries for medically unnecessary home health services, as well as accepted kickbacks from home health agencies in exchange for writing these referrals. According to court documents, since January 2008, HCP has billed Medicare for approximately $9.2 million. In the same time period, HCP has allegedly referred Medicare beneficiaries for home health services that have resulted in approximately $30.8 million of reimbursements from Medicare.
Today’s charges were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan; Special Agent in Charge Robert D. Foley III of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS-OIG Chicago Regional Office.
The case is being prosecuted by Trial Attorney Catherine K. Dick of the Criminal Division's Fraud Section. The investigations were conducted jointly by the FBI and HHS-OIG, as part of the Medicare Fraud Strike Force, supervised by the U.S. Attorney's Office for the Eastern District of Michigan and the Criminal Division's Fraud Section.
Criminal complaints contain merely charges, and defendants are presumed innocent until proven guilty.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,330 defendants who have collectively billed the Medicare program for more than $4 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Colorado Big Game Outfitter Convicted of Six Lacey Act ViolationsRead the Press Release
WASHINGTON – Big game hunting outfitter Dennis Eugene Rodebaugh, 72, of Meeker, Colo., was convicted by a federal jury in Denver today of six charges of violating the Lacey Act, announced the Department of Justice Environment and Natural Resources Division, U.S. Fish and Wildlife Service, and Colorado Parks and Wildlife.
According to the indictment, Rodebaugh operated a Colorado big game outfitting business called “D&S Guide and Outfitter” beginning in 1988, offering multi-day elk and deer hunts to many non-resident clients in the White River National Forest for between $1,200 and $1,600. The indictment alleged that each summer between 2002 and 2007, the defendant outfitted numerous clients, on hunts in which deer and elk were shot from tree stands near which Rodebaugh placed hundreds of pounds of salt each spring and summer as bait. The placement and use of bait to aid in the taking of big game is unlawful in Colorado. The interstate sale of big game outfitting and guiding services for the unlawful taking of big game with the aid of bait constitutes a felony violation of the Lacey Act.
Each of the six felony counts on which the defendant was convicted carries a maximum punishment of five years imprisonment and up to a $250,000 fine. Rodebaugh also agreed to forfeit two all terrain vehicles and a utility trailer used in the commission of the six Lacey Act crimes.
This case was investigated by Colorado Parks and Wildlife and the U.S. Fish and Wildlife Service.
The case was prosecuted by Senior Trial Attorney J. Ronald Sutcliffe and Trial Attorney Mark Romley, of the Justice Department’s Environmental Crimes Section of the Environment and Natural Resources Division.
19 September 2012
Statement by Attorney General Eric Holder on the<br /> Office of the Inspector General’s Report on<br /> Operation Fast and FuriousRead the Press Release
Attorney General Eric Holder released the following statement today on the Department of Justice’s Office of the Inspector General’s report on Operation Fast and Furious:
“I have reviewed the Office of the Inspector General’s report on Operation Fast and Furious and the key conclusions are consistent with what I, and other Justice Department officials, have said for many months now:
The inappropriate strategy and tactics employed were field-driven and date back to 2006;
The leadership of the Department did not know about or authorize the use of the flawed strategy and tactics; and
The Department’s leadership did not attempt to cover up information or mislead Congress about it.
“Beginning in 2011 - shortly after public concerns were first raised about Operation Fast and Furious – I referred this matter to the Office of the Inspector General (OIG). Throughout the next several months, I instituted significant policy reforms, stronger internal controls and made key personnel changes to prevent the flaws that plagued this investigation, as well as the earlier investigation, Operation Wide Receiver, from recurring. I’m pleased that the OIG report appropriately recognizes these reforms.
“Based upon the information in the OIG report and other related information, I am also announcing additional personnel changes today.
“First, Kenneth Melson, the former Acting Director at ATF, has retired from the Department, effective immediately. Ken has served the Department in several important roles for over thirty years, including as a United States Attorney for the Eastern District of Virginia and more recently as an advisor on forensic science issues. I want to thank him for his dedication and service to the Department over the last three decades.
“Second, those individuals within ATF and the U.S. Attorney's Office for the District of Arizona, whom the OIG report found to have been responsible for designing, implementing or supervising Operation Fast and Furious have been referred to the appropriate entities for review and consideration of potential personnel actions. Consistent with the requirements of the Privacy Act, the Department is prohibited from revealing any additional information about these referrals at this time.
“Finally, I have accepted the resignation of Deputy Assistant Attorney General Jason Weinstein, a longtime career prosecutor who most recently served in the Criminal Division where he led our violent and organized crime, computer crimes and intellectual property enforcement efforts. Jason has dedicated much of his career to fighting violent crime and has led highly successful efforts around the country in this effort. The American people are safer because of his work. His commitment to the Department has been unwavering, and I deeply appreciate his 15 years of distinguished service here at Main Justice as well as in Baltimore and New York.
“It is unfortunate that some were so quick to make baseless accusations before they possessed the facts about these operations – accusations that turned out to be without foundation and that have caused a great deal of unnecessary harm and confusion. I hope today’s report acts as a reminder of the dangers of adopting as fact unsubstantiated conclusions before an investigation of the circumstances is completed.
“I want to assure the American people that I, and my colleagues at the Department, will continue to focus on our mission of protecting their rights and their security, and doing so in a manner that is consistent with the high standards of the Department of Justice. This includes continuing to seek justice on behalf of Agent Brian Terry and his loved ones.
“The FBI and the United States Attorney from the Southern District of California have been working for many months with Mexican authorities to identify and apprehend the fugitives involved in the murder of Agent Terry, who made the ultimate sacrifice in serving his country. We now have two men in custody and we will continue to aggressively pursue the remaining fugitives to ensure justice for Agent Terry, his family and his fellow law enforcement agents who put their lives on the line each day to keep this country safe.”
Justice Department Settles Sex Discrimination Lawsuit Against City of Corpus Christi, Texas, Police DepartmentRead the Press Release
The Department of Justice announced today that it has entered into a settlement to resolve the department’s allegations that the city of Corpus Christi, Texas, violated Title VII of the Civil Rights Act of 1964 by discriminating against women when hiring entry-level police officers.
The United States’ complaint against Corpus Christi, filed in the U.S. District Court for the Southern District of Texas, alleges that between 2005 and 2011, the city used a physical abilities test when hiring entry-level police officers, and that test screened out many more women than men but did not test for what is required on the job. Title VII prohibits discrimination in employment on the basis of race, color, sex, national origin or religion, whether the discrimination is intentional or involves the use of employment practices, like physical abilities tests, that have a disparate impact and are not job related and consistent with business necessity.
“Hiring processes, including for those who seek to serve and protect the public as police officers, should be free from discrimination,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “ The department commends Corpus Christi for its cooperation, for working to put in place new hiring procedures that comply with Title VII, and for providing relief to the women who have been harmed by the prior practices challenged by the department.”
The Justice Department and Corpus Christi jointly filed a motion today requesting that the court provisionally enter a consent decree that lays out the terms of the settlement. The motion also asks the court to schedule a fairness hearing on the decree, the opportunity provided by Title VII for the public to comment on the decree. The proposed consent decree must be approved by the court.
The consent decree requires that Corpus Christi no longer use the physical abilities test challenged by the United States for selecting entry-level police officers. It also requires the city to develop a new selection procedure that complies with Title VII. Additionally, the consent decree requires the city to pay $700,000 as backpay to female applicants who took and failed the challenged physical abilities test between 2005 and 2011 and are determined to be eligible for relief. Also under the consent decree, some women who took and failed the challenged physical abilities test between 2005 and 2011 may receive offers of priority employment with retroactive seniority and benefits. Applicants interested in priority employment must pass the new, lawful selection procedure developed by Corpus Christi under the decree and meet other qualifications required of all applicants considered for entry-level police officer positions.
“The physical abilities test formerly used by Corpus Christi prevented the city from distinguishing between qualified and unqualified applicants,” continued Mr. Perez. “Here, the Justice Department is ensuring the selection of qualified officers while eliminating artificial, discriminatory barriers. Because Corpus Christi will develop a new, lawful test that all candidates must pass, the public will be assured that the selection process is fair and nondiscriminatory and selects qualified candidates.”
Enforcement of federal employment discrimination laws is a top priority for the Justice Department. Additional information about Title VII and other federal employment laws is available on the Civil Rights Division’s website at www.justice.gov/crt .
Related Materials:
Proposed Consent Decree
Proposed OrderJapanese Freight Forwarder Agrees to Plead Guilty to Criminal<br /> Price-Fixing ChargesRead the Press Release
WASHINGTON – A Japanese freight forwarding company has agreed to plead guilty and to pay a $2.3 million criminal fine for its role in a conspiracy to fix certain fees in connection with the provision of freight forwarding services for air cargo shipments from Japan to the United States, the Department of Justice announced today.
Including today’s charge, as a result of this investigation, 14 companies have either pleaded guilty or agreed to plead guilty and to pay more than $100 million in criminal fines.According to the one count felony charge filed today in the U.S. District Court for the District of Columbia, Yamato Global Logistics Japan Co. Ltd. engaged in a conspiracy to fix and to impose certain freight forwarding service fees, including fuel surcharges and various security fees, charged to customers for services provided in connection with freight forwarding shipments of cargo shipped by air from Japan to the United States from about September 2002 until at least November 2007.
As part of the plea agreement, which will be subject to court approval , Yamato Global Logistics Japan Co. Ltd. has agreed to pay a criminal fine of $2,326,774 and to cooperate with the department’s ongoing antitrust investigation.
“Consumers ultimately were forced to pay higher prices on the goods they buy every day as a result of the noncompetitive and collusive service fees charged by these companies,” said Scott D. Hammond, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program. “Prosecuting these kinds of global price-fixing conspiracies continues to be a high priority of the Antitrust Division.”
According to the charges, the company carried out the conspiracy by, among other things, agreeing during meetings and discussions to coordinate and impose certain freight forwarding service fees and charges on customers purchasing freight forwarding services for cargo shipped by air from Japan to the United States. The department said the company levied freight forwarding service fees in accordance with the agreements reached and engaged in meetings and discussions for the purpose of monitoring and enforcing adherence to the agreed-upon freight forwarding service fees.
Freight forwarders manage the domestic and international delivery of cargo for customers by receiving, packaging, preparing and warehousing cargo freight, arranging for cargo shipment through transportation providers such as air carriers, preparing shipment documentation and providing related ancillary services.
The company is charged with price fixing in violation of the Sherman Act, which carries a maximum $100 million fine for corporations. 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.
Today’s charges are the result of a joint investigation into the freight forwarding industry being conducted by the Antitrust Division’s National Criminal Enforcement Section, the FBI’s Washington Field Office and the Department of Commerce’s Office of Inspector General. Anyone with information concerning price fixing or other anticompetitive conduct in the freight forwarding industry is urged to call the Antitrust Division’s National Criminal Enforcement Section at 202-307-6694 or visit www.justice.gov/atr/contract/newcase.htm or call the FBI’s Washington Field Office at 202-278-2000.
Hospital Chain HCA Inc. Pays $16.5 Million to Settle False Claims Act Allegations Regarding Chattanooga, Tenn., HospitalRead the Press Release
HCA Inc., one of the nation’s largest for-profit hospital chains, has agreed to pay the United States and the state of Tennessee $16.5 million to settle claims that it violated the False Claims Act and the Stark Statute, the Department of Justice announced today.
As alleged in the settlement agreement, during 2007, HCA, through its subsidiaries Parkridge Medical Center, located in Chattanooga, Tenn., and HCA Physician Services (HCAPS), headquartered in Nashville, Tenn., entered into a series of financial transactions with a physician group, Diagnostic Associates of Chattanooga, through which it provided financial benefits intended to induce the physician members of Diagnostic to refer patients to HCA facilities. These financial transactions included rental payments for office space leased from Diagnostic at a rate well in excess of fair market value in order to assist Diagnostic members to meet their mortgage obligations and a release of Diagnostic members from a separate lease obligation.
The Stark Statute restricts financial relationships that hospitals may enter into with physicians who potentially may refer patients to them. Federal law prohibits the payment of medical claims that result from such prohibited relationships.
“The Department of Justice continues to pursue cases involving improper financial relationships between health care providers and their referral sources, because such relationships can corrupt a physician’s judgment about the patient’s true healthcare needs,” said Stuart F. Delery, the Acting Assistant Attorney General for the Department of Justice’s Civil Division.
“Physicians should make decisions regarding referrals to health care facilities based on what is in the best interest of patients without being induced by payments from hospitals competing for their business,” said Bill Killian, U.S. Attorney for the Eastern District of Tennessee.
“ Improper business deals between hospitals and physicians jeopardize both patient care and federal program dollars,” said Daniel R. Levinson, Inspector General of the Department of Health and Human Services. “Our investigators continue to work shoulder to shoulder with other law enforcement authorities to stop schemes that imperil scarce health care
resources.”
The civil settlement resolves a lawsuit, United States ex rel. Bingham v. HCA, No. 1:08-CV-71 (E.D. Tenn.), pending in federal court in the Eastern District of Tennessee under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring civil actions on behalf of the United States and share in any recovery. As part of the civil settlement, HCA has agreed to pay $16.5 million to the United States and the state of Tennessee, with the federal portion representing $15,693,000 of the settlement amount. The whistleblower will receive an 18.5 percent share.
Also as part of the settlement, Parkridge Medical Center has entered into a comprehensive five-year Corporate Integrity Agreement with the Office of Inspector General of the U.S. Department of Health and Human Services to ensure its continued compliance with federal health care benefit program requirements.
This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $9.4 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $13.1 billion.
The case was handled by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Eastern District of Tennessee, the Office of Inspector General of the Department of Health and Human Services, the Defense Criminal Investigative Service (DCIS) and the Tennessee Bureau of Investigation (TBI). The claims settled by this agreement are allegations only, and there has been no determination of liability.
Attorney General Eric Holder Expands National Forum on Youth Violence Prevention to Ten CitiesRead the Press Release
Attorney General Eric Holder and Acting Assistant Attorney General for the Office of Justice Programs (OJP) Mary Lou Leary today announced that four new cities will join a White House initiative to prevent youth violence. New Orleans, Philadelphia, Minneapolis and Camden, N.J., will join the six original cities in the National Forum on Youth Violence Prevention to reduce youth violence and gang activity and improve public safety.
“Children involved in violent crime have often been exposed to violence, either as victims or witnesses, and we must do everything in our power to end that cycle,” said Attorney General Eric Holder. “The purpose of this forum is to bring together community and faith-based organizations, law enforcement, public health professionals as well as business and philanthropic leaders to work together toward a common goal: stopping youth and gang violence.”
Launched in 2010 at the direction of President Obama, the forum is a network of communities and federal agencies that share information and support local efforts to prevent and reduce youth violence.
“Youth violence is not a problem any of us can solve alone, but by working together – by pooling resources and ideas – we have the ability to reduce youth violence in our communities,” said Acting Assistant Attorney General Leary.
The 10 cities will participate in a working session this fall and highlight their strategies to address youth violence at a national summit in Washington, D.C., next spring. The new cities were selected through a competitive application process. The six original cities are Boston; Chicago; Detroit; Memphis, Tenn.; Salinas, Calif.; and San Jose, Calif.
“As education and civic leaders, keeping kids safe is key to preparing them for healthy, happy, successful futures in school and beyond,” said U.S. Secretary of Education Arne Duncan. “Spreading community-led efforts to reduce youth violence will enable children to live up to their fullest potential while also contributing to greater safety and prosperity for everyone within those communities, and for our entire nation.”
The forum’s federal partners include the Departments of Justice, Education, Health and Human Services, Housing and Urban Development and Labor; the Corporation for National and Community Service; and the White House Office of National Drug Control Policy.
Since the forum began, the cities have leveraged new partnerships with foundations and private corporations to prevent youth violence and have initiated a number of programs for youth and families in their communities. Earlier this year, Casey Family Programs sponsored activities for forum youth representatives at the national summit in Washington, D.C. Additionally, retail company Target awarded grants of $10,000 to the six forum sites to hire a youth director in each community.
The participating cities have also partnered with community organizations, including a partnership in Salinas with a local college for a Science Engineering Mathematics and Aerospace Academy that served 2,000 students this past summer. And in San Jose, the city started a media training program for area youth that enables young people to interview leaders in their community.
For more information on the cities’ plans and progress, please visit: www.findyouthinfo.gov/youthviolence .
OJP 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). For more information about OJP and its components can please visit: www.ojp.gov .
Alabama Defendants Sentenced in a Multi- Million Dollar Stolen Identity Refund Fraud SchemeRead the Press Release
Three defendants involved in a stolen identity refund fraud scheme were sentenced today in the Middle District of Alabama, the Justice Department and the Internal Revenue Service (IRS) announced today. Chiquanta Davis received a prison term of 66 months, Terrence Davis was sentenced to 18 months in jail and Laurekshia Blakely received a six month prison sentence. All three were also sentenced to three years supervised release.
In May 2012, the three defendants had pleaded guilty to various charges in a superseding indictment: Chiquanta Davis pleaded guilty to conspiracy to file false claims, theft of public funds, and aggravated identity theft. Terrence Davis and Blakely each pleaded guilty to one count of theft of public funds.
According to court documents, Chiquanta Davis operated a sham tax business in 2010 called It’s Tax Time out of her home. Davis opened a bank account in the name of It’s Tax Time and directed a total of $1,458,600 in fraudulent refunds to that bank account. Although the IRS intercepted and stopped many of the tax refunds, Davis still received a substantial amount into the bank account. Davis used the funds, among other things, to purchase a Cadillac Escalade. As part of her plea agreement, Davis agreed to forfeit the Cadillac Escalade.
Court records also establish that in 2011, Chiquanta Davis assisted with the filing of false tax using stolen identities. Between January and June of 2011, 192 false returns requesting $769,223 in refunds were filed from her home. These refunds were directed to various bank accounts, including bank accounts controlled by her, her husband Terrence Davis and Laurekshia Blakely. Fraudulent refunds totaling $199,959 from 54 false tax returns were directed to Terrence Davis’s bank accounts. Fraudulent refunds totaling $24,314 from five false tax returns were directed to Laurekshia Blakely’s accounts.
Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, and U.S. Attorney George L. Beck, Jr. commended the efforts of special agents of IRS – Criminal Investigation for investigating the case, and Tax Division Trial Attorneys Jason H. Poole and Michael Boteler and Assistant U.S. Attorney Todd Brown for prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax.
18 September 2012
Self-Proclaimed “President” of Sovereign Citizen Group Indicted for Tax CrimesRead the Press Release
A federal grand jury in Montgomery, Ala., charged James Timothy Turner, also known as Tim Turner, with conspiracy to defraud the United States, attempting to pay taxes with fictitious financial instruments, attempting to obstruct and impede the Internal Revenue Service (IRS), failing to file a 2009 federal income tax return and falsely testifying under oath in a bankruptcy proceeding, the Justice Department, the IRS, and the FBI announced today.
According to the indictment, Turner, the self-proclaimed “President” of the sovereign citizen group “Republic for the united States of America,” conducted seminars at which he taught attendees how to file retaliatory liens against government officials and to defraud the IRS by preparing and submitting fictitious bonds to the United States government in payment of federal taxes. Turner is alleged to have attempted to pay his own taxes with a fictitious $300 million bond and to have assisted others in attempting to pay their taxes with fictitious bonds purporting to be worth amounts ranging from $10 million to $100 billion.
An indictment merely alleges that a crime has been committed, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Turner faces a maximum of 164 years in federal prison, a maximum fine of $2,350,000 and mandatory restitution.
This case was investigated by special agents of the FBI and IRS – Criminal Investigation, and is being prosecuted by Trial Attorney Justin Gelfand of the Justice Department’s Tax Division and Middle District of Alabama Assistant U.S. Attorney Gray Borden.
Los Angeles Physician Assistant Sentenced to 72 Months in Prison for Role in $18.9 Million Medicare Fraud SchemeRead the Press Release
WASHINGTON – A Los Angeles physician assistant who stole the identities of doctors to write medically unnecessary prescriptions for expensive durable medical equipment (DME) and diagnostic tests was sentenced today to serve 72 months in prison in connection with a $18.9 million Medicare fraud scheme, announced the Department of Justice, FBI and U.S. Department Health and Human Services (HHS).
David James Garrison, 50, was sentenced by U.S. District Judge Consuelo B. Marshall in the Central District of California. In addition to his prison term, Garrison was sentenced to three years of supervised release and ordered to pay $24,935 in restitution, jointly and severally with convicted co-defendants.
In June 2012, after a two-week trial, a federal jury found Garrison guilty of one count of conspiracy to commit health care fraud, six counts of health care fraud and one count of aggravated identity theft. The trial evidence showed that Garrison worked at fraudulent medical clinics that operated as prescriptions mills and trafficked in fraudulent prescriptions and orders for medically unnecessary DME and diagnostic tests that were used by fraudulent DME supply companies and medical testing facilities to defraud Medicare. Garrison wrote the prescriptions and ordered the tests on behalf of doctors whom he never met and who did not authorize him to write prescriptions and order tests on their behalf.The trial evidence showed that between March 2007 and September 2008, Garrison’s co-conspirator Edward Aslanyan and others owned and operated several Los Angeles medical clinics established for the sole purpose of defrauding Medicare. Aslanyan and others hired street-level patient recruiters to find Medicare beneficiaries willing to provide the recruiters with their Medicare billing information in exchange for expensive, high-end power wheelchairs and other DME, which the patient recruiters told the beneficiaries they would receive for free. Often, the solicited Medicare beneficiaries did not have a legitimate medical need for the power wheelchairs and equipment. The patient recruiters then provided the beneficiaries’ Medicare billing information to Aslanyan and others or brought the beneficiaries to the fraudulent medical clinics. In exchange for recruiting the Medicare beneficiaries, Aslanyan and others paid the recruiters a cash kickback for every beneficiary they recruited.
The evidence presented at trial showed that Garrison wrote prescriptions for power wheelchairs, which the beneficiaries did not need and did not use. In some cases, Garrison wrote power wheelchair prescriptions for beneficiaries he never examined and who never visited the clinics. Once Garrison wrote the power wheelchair prescriptions, Aslanyan and others sold them from $1,000 to $1,500 to the owners and operators of approximately 50 different fraudulent DME supply companies, which used the prescriptions to submit fraudulent power wheelchair claims to Medicare. The DME supply companies purchased the power wheelchairs wholesale for approximately $900 per wheelchair but billed the wheelchairs to Medicare at a rate of approximately $5,000 per wheelchair. Aslanyan also used the prescriptions Garrison wrote at two fraudulent DME supply companies that Aslanyan owned and operated.
In addition, the trial evidence showed that Garrison ordered the same medically unnecessary diagnostic tests for every Medicare beneficiary, including tests for sleep studies, ultrasounds and nerve conduction. These tests were then billed to Medicare by fraudulent diagnostic testing companies that paid Aslanyan kickbacks to operate from the medical clinics.
The trial evidence showed that Garrison admitted to writing prescriptions for power wheelchairs and ordered diagnostic tests on behalf of approximately six different doctors, many of whom never met Garrison and never had a delegation of services agreement with him, as required by law. The trial evidence also showed that Garrison was paid up to $10,000 a week in cash for his work at the clinics.
As a result of this fraud scheme, Garrison and his co-conspirators submitted over $18.9 million in false claims to Medicare and received $10.7 million on those claims.
Currently, Garrison is facing federal drug charges as a result of his alleged involvement with another medical clinic where medically unnecessary prescriptions for Oxycontin were distributed. Garrison is scheduled for trial on the federal drug charges on Nov. 6, 2012. He is presumed innocent of the charges against him.
Aslanyan pleaded guilty for his role in the scheme in April 2011 and was sentenced on Feb. 6, 2012, to 77 months in prison. Carolyn Vasquez, another co-conspirator, pleaded guilty for her role in the scheme in March 2011 and was sentenced on Jan. 9, 2012, to 60 months in prison.
Today’s sentence was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney André Birotte Jr. for the Central District of California; Tony Sidley, Assistant Chief of the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse; Glenn R. Ferry, Special Agent-in-Charge for the Los Angeles Region of the HHS Office of Inspector General (HHS-OIG); and Timothy Delaney, Special Agent in Charge of the FBI’s Los Angeles Field Office.
The case is being prosecuted by Trial Attorney Jonathan T. Baum of the Criminal Division’s Fraud Section and Assistant U.S. Attorney David Kirman of the Central District of California. The case is being investigated by the FBI and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California.
Since its inception in March 2007, strike force operations in nine locations have charged more than 1,330 defendants who collectively have billed the Medicare program for more than $4 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, go to: www.stopmedicarefraud.gov.
Justice Department Releases Investigative Findings on the Alamance County, N.C., Sheriff’s Office <br />Read the Press Release
Following a comprehensive investigation, the Justice Department announced today its findings that the Alamance County Sheriff’s Office (ACSO) in North Carolina, under the leadership of Sheriff Terry S. Johnson, engages in a pattern or practice of misconduct that violates the Constitution and federal law. The department conducted its investigation, which it opened on June 2, 2010, pursuant to the Violent Crime Control and Law Enforcement Act of 1994 and Title VI of the Civil Rights Act of 1964 (Title VI).
The Justice Department finds reasonable cause to believe that ACSO engages in a pattern or practice of discriminatory policing against Latinos in violation of the Equal Protection Clause of the Fourteenth Amendment, the Fourth Amendment, the Violent Crime Control and Law Enforcement Act and Title VI. ACSO’s discriminatory policing activities include:
- ACSO deputies target Latino drivers for traffic stops;
- A study of ACSO’s traffic stops on three major county roadways found that deputies were between four and 10 times more likely to stop Latino drivers than non-Latino drivers;
- ACSO deputies routinely locate checkpoints just outside Latino neighborhoods, forcing residents to endure police checks when entering or leaving their communities;
- ACSO practices at vehicle checkpoints often vary based on a driver’s ethnicity. Deputies insist on examining identification of Latino drivers, while allowing drivers of other ethnicities to pass through without showing identification;
- ACSO deputies arrest Latinos for minor traffic violations while issuing citations or warnings to non-Latinos for the same violations;
- ACSO uses jail booking and detention practices, including practices related to immigration status checks, that discriminate against Latinos;
- The sheriff and ACSO’s leadership explicitly instruct deputies to target Latinos with discriminatory traffic stops and other enforcement activities;
- The sheriff and ACSO leadership foster a culture of bias by using anti-Latino epithets; and
- ACSO engages in substandard reporting and monitoring practices that mask its discriminatory conduct.
Taken together, these practices undermine ACSO’s ability to serve and protect Alamance County’s Latino residents and the community at large.
“The Alamance County Sheriff’s Office’s egregious pattern of racial profiling violates the Constitution and federal laws, creates distrust between the police and the community and inhibits the reporting of crime and cooperation in criminal investigations,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “Constitutional policing and effective law enforcement go hand-in-hand. We hope to resolve the concerns outlined in our findings by working collaboratively with ACSO, but we will not hesitate to take appropriate legal action if ACSO chooses a different course.”
The Justice Department’s thorough and independent investigation included an in-depth review of ACSO policies, procedures, training materials, and data on traffic stops, arrests, citations, vehicle checkpoints and other documentary evidence. Department personnel also conducted interviews with more than 125 individuals, including Alamance County residents and current and former ACSO employees.
Addressing these findings and creating sustainable reforms will require ACSO to commit to long term structural, cultural and institutional change. In particular, ACSO must develop and implement new policies, procedures and training in effective and constitutional policing. Any reform efforts must also include systems of accountability to ensure that ACSO has eliminated unlawful bias from its decision making at all levels.
The department will seek to obtain a court enforceable, comprehensive, written agreement remedying the violations and incorporating these reforms by attempting to work with ACSO officials.
The Special Litigation Section of the Civil Rights Division conducted this investigation with the assistance of consultants in law enforcement and statistical analysis. Members of the Alamance County community who wish to provide information to the department may call 1-877-871-9726 or email [email protected] . For more information on the Justice Department’s Civil Rights Division, please visit www.justice.gov/crt .
Related Materials:
Letter of Findings
Justice Department Announces New Directive to Fight Stolen Identity Refund FraudRead the Press Release
The Justice Department’s Tax Division has issued a new directive to further the efforts of the Tax Division and the U.S. Attorneys’ Offices to respond quickly and effectively to the grave challenges in stolen identity refund fraud (SIRF) cases.
Tax Division Directive 144
Tax Division Directive 144, which takes effect on Oct. 1, 2012, will allow prosecutors in U.S. Attorneys’ Offices that designate a point of contact for SIRF cases to open tax-related grand jury investigations, to charge by complaint criminals who are engaged in SIRF crimes and to obtain seizure warrants for forfeiture of criminally derived proceeds arising from SIRF crimes, all without prior authorization from the Tax Division.
To ensure fair and consistent nationwide enforcement of tax laws, the Tax Division has supervision over virtually all criminal proceedings arising under the internal revenue laws. Tax refund fraud involving the use of stolen identities has emerged as fast-growing and insidious crime that is all-too-simple in its execution. Strong coordination at all levels of law enforcement is vital to combating these criminals. The Tax Division has issued Directive 144 to further these coordination efforts.
SIRF Crimes Harm American Taxpayers
SIRF crimes covered by Directive 144 involve the filing or attempted filing of fraudulent tax refund claims, using personal identification information such as Social Security numbers that have either been stolen or are otherwise being unlawfully used. When a stolen identity is used to commit tax refund fraud, tax dollars are paid out to fraudsters and all honest taxpayers are victims. An individual taxpayer whose personal identification information is misused to file false refunds will receive any rightfully due refund from the Internal Revenue Service (IRS), but may nonetheless experience burdens and delays in the process. In specific cases, the most vulnerable in our country have been personally victimized by this form of identity theft, and one recent prosecution resulted in a conviction for the murder of a postal worker by a thief seeking access to erroneous refunds.
Expedited Prosecution Procedures Also Announced
The Tax Division has retained its authority in SIRF cases to review and authorize the filing of charges by indictment and information. Simultaneous with the issuance of Directive 144, the Tax Division has announced new expedited review procedures in cases involving arrests in jurisdictions where the U.S. Attorney’s Office is participating in the procedures established in Directive 144.
SIRF convictions have resulted from the investigative efforts of many local and federal law enforcement agencies. Prosecutions in SIRF cases brought by U.S. Attorneys’ Offices and the Tax Division have resulted in lengthy prison sentences and substantial fines and forfeitures.
It is important that the IRS obtain information, through SIRF investigations, to intercept fraudulent tax refund claims before erroneous refunds are sent to fraudsters. The procedures set out in Directive 144 and the new expedited review procedures are designed to facilitate this goal.
“Directive 144 and the new expedited review procedures are the result of a collaborative effort between the Tax Division and the U.S. Attorneys’ Offices to strengthen law enforcement’s response to stolen identity refund fraud crimes, which are an affront to all honest taxpayers,” said the Tax Division’s Assistant Attorney General, Kathryn Keneally. “The prosecution of these crimes is a national priority, and we will continue to look for the most effective ways to bring this conduct to an end and to punish these wrongdoers.”
“Streamlining the authority to prosecute Stolen Identity Refund Fraud (SIRF) investigations is yet another step toward combating this fast growing crime,” said Richard Weber, Chief, IRS Criminal Investigation. “We look forward to working with the United States Attorneys in aggressively tackling ID theft which has turned the lives of so many innocent taxpayers upside down when their identities have been stolen by thieves whose sole motivation is greed.”
Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax .
Related Documents: Expedited and Parallel Review of Proposed Indictments Arising from Stolen identity Refund Fraud (PDF)
Directive 144 - Temporary Delegation of Authority to Authorize Grand Jury Investigations, Criminal Complaints, and Seizure Warrants for Certain Offenses Arising from Stolen Identity Refund Fraud (PDF)
17 September 2012
Two Romanian Nationals Plead Guilty to Participating in Multimillion Dollar Scheme to Remotely Hack into and Steal Payment Card Data from Hundreds of US Merchants’ ComputersRead the Press Release
Two Romanian nationals pleaded guilty today to participating in an international, multimillion-dollar scheme to remotely hack into and steal payment card data from hundreds of U.S. merchants’ computers.
Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; John P. Kacavas, U.S. Attorney for the District of New Hampshire; and Holly Fraumeni, Resident Agent in Charge of the U.S. Secret Service, Manchester, N.H., Resident Office, announced today that Iulian Dolan, 28, of Craiova, Romania, pleaded guilty to one count of conspiracy to commit computer fraud and two counts of conspiracy to commit access device fraud, and Cezar Butu, 27, of Ploiesti, Romania, pleaded guilty to one count of conspiracy to commit access device fraud.
In their guilty pleas, the defendants admitted that, from in or about 2009-2011, they participated in Romanian-based conspiracies with co-conspirator Adrian-Tiberiu Oprea, who is in U.S. custody and awaiting trial in the District of New Hampshire, to hack into hundreds of U.S.-based computers to steal credit, debit and payment account numbers and associated data (collectively “payment card data”) that belonged to U.S. cardholders and then use the stolen payment card data to make unauthorized charges on, and/or transfers of funds from, those cardholders’ accounts (or alternatively to transfer the stolen payment card data to other co-conspirators who would do the same).
At the plea hearings today, federal prosecutors noted that the conspiracies involved more than 146,000 compromised cards and more than $10 million in losses.
Dolan admitted that he, along with Oprea, remotely hacked into U.S. merchants’ “point-of-sale” (POS) or “check out” computer systems, where customers’ payment card data was electronically stored. Specifically, Dolan first remotely scanned the internet to identify U.S.-based vulnerable POS systems with certain remote desktop software applications (RDAs) installed on them. Using these RDAs, Dolan logged onto the targeted POS systems over the internet. These were typically password-protected, so Dolan would attempt to crack the passwords, where necessary, to gain administrative access. He would then remotely install software programs called “keystroke loggers” (or “sniffers”) onto the POS systems. These programs would record, and then store, all of the data that was keyed into or swiped through the merchants’ POS systems, including customers’ payment card data.
Dolan periodically remotely hacked back into the compromised merchants’ POS system to retrieve the customers’ payment card data and then electronically transferred the payment card data to various electronic storage locations (“dump sites”) that Oprea had set up. Dolan knew that Oprea later attempted to use the stolen payment card data to make unauthorized charges on, or transfers of funds from, the accounts. He also knew that Oprea attempted to sell, or otherwise transfer, the stolen payment card data to other co-conspirators for them to use in a similar manner. During the course of the conspiracies, the co-conspirators hacked into several hundred U.S. merchants’ POS systems. Dolan stole payment card data belonging to approximately 6,000 cardholders and was aware that Oprea was engaged in similar conduct. Dolan received approximately $5,000 - $7,500 in cash and personal property from Oprea for his efforts.
In his plea agreement, Butu admitted that he repeatedly asked Oprea to provide him with stolen payment card data and that Oprea provided him with instructions for how to access the website where Oprea had stored a portion of the stolen payment card data. Butu later attempted to use the stolen payment card data to make unauthorized charges on, or transfers of funds from, the accounts. He also attempted to sell, or otherwise transfer, the stolen payment card data to other co-conspirators for them to use in a similar manner. Butu acquired stolen payment card data from Oprea belonging to approximately 140 cardholders.
In his plea agreement, Dolan has agreed to be sentenced to seven years, and Butu has agreed to be sentenced to 21 months in prison.
The case was investigated by the U.S. Secret Service, with the assistance of the New Hampshire State Police and Romanian authorities.
The case is being prosecuted by Trial Attorney Mona Sedky in the Department of Justice’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Arnold H. Huftalen from the District of New Hampshire.
Philadelphia La Cosa Nostra Capo Sentenced<br /> <br /> to 57 Months in PrisonRead the Press Release
Martin Angelina, 50, of Philadelphia, was sentenced today to 57 months in prison for his participation in a racketeering conspiracy involving loan sharking and illegal gambling, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; Zane David Memeger, U.S. Attorney for the Eastern District of Pennsylvania and George C. Venizelos, Special Agent in Charge of the FBI’s Philadelphia Division.
Angelina was sentenced by U.S. District Judge Eduardo C. Robreno in the Eastern District of Pennsylvania. In addition to his prison term, Judge Robreno ordered Angelina to serve three years of supervised release. On Aug. 8, 2012, Angelina pleaded guilty to conspiring to conduct and participate in the affairs of the Philadelphia La Cosa Nostra (LCN) Family through a pattern of racketeering activity. At the time of the plea, Angelina admitted he attempted to collect payments related to usurious loans by using extortionate means and operated an illegal video poker machine business in furtherance of the racketeering conspiracy.
Angelina is among 14 members and associates of the Philadelphia LCN Family charged with crimes involving racketeering conspiracy, extortion, loan sharking, illegal gambling, witness tampering and theft from an employee benefit plan in a third superseding indictment returned by a federal grand jury in Philadelphia on July 25, 2012. The other defendants charged in the 52-count third superseding indictment included Philadelphia LCN Family boss Joseph Ligambi, Philadelphia LCN Family underboss Joseph Massimino, George Borgesi, Gaeton Lucibello, Anthony Staino Jr., Damion Canalichio, Louis Barretta, Gary Battaglini, Robert Verrecchia, Eric Esposito, Robert Ranieri, Joseph Licata and Louis Fazzini.
Lucibello pleaded guilty to racketeering conspiracy charges on Aug. 2, 2012, and was sentenced to 51 months in prison. Barretta also pleaded guilty to racketeering conspiracy charges on Sept. 5, 2012, and is awaiting sentencing on Nov. 26, 2012.
The trial for Ligambi, Massimino, Borgesi, Staino Jr., Canalichio, Battaglini, Licata and Fazzini is scheduled for Oct. 9, 2012. The trial for Verrecchia, Esposito and Ranieri has not yet been scheduled. Ligambi, Massimino, Borgesi, Canalichio, Licata and Fazzini are detained while awaiting trial. Staino Jr., Battaglini, Verrecchia, Esposito and Ranieri are free on bond while awaiting trial.
The case is being prosecuted by Trial Attorney John S. Han of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Frank A. Labor III and Suzanne B. Ercole of the Eastern District of Pennsylvania. Valuable prosecutorial assistance was provided by the Pennsylvania Office of the Attorney General.
The case is being investigated by the FBI, the Internal Revenue Service-Criminal Investigation, the Pennsylvania State Police, the New Jersey State Police, the Philadelphia Police Department, the U.S. Department of Labor’s Office of Inspector General Office of Labor Racketeering and Fraud Investigations and the U.S. Department of Labor’s Employee Benefits Security Administration. Additional assistance was provided by the New Jersey Department of Corrections.
14 September 2012
Members of Smuggling Ring Plead Guilty in Los Angeles to Crimes Relating to Illegal Trafficking of Endangered Rhinoceros HornRead the Press Release
WASHINGTON – Three defendants pleaded guilty today to charges of conspiracy, smuggling, Lacey Act violations, money laundering and tax fraud for their roles in the international illegal trafficking of rhinoceros horn. All of the defendants were charged in February 2012 as part of “Operation Crash,” a nationwide U.S. Fish and Wildlife Service crackdown on those involved in the black market trade of endangered rhinoceros horn.
The guilty pleas were announced by Ignacia S. Moreno, Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice; André Birotte Jr., U.S. Attorney for the Central District of California; and Dan Ashe, Director of the Department of the Interior’s U.S. Fish and Wildlife Service (FWS).
Vin h Chung “Jimmy” Kha, 49, and Felix Kha, 26, both of Garden Grove, Calif., each pleaded guilty to five felony counts related to their roles in the smuggling conspiracy. Win Lee Corp., owned by Jimmy Kha, pleaded guilty to two felony counts charging smuggling and Lacey Act trafficking.
Two other defendants linked to the Khas – J in Zhao Feng, 45, of China and Jarrod Wade Steffen, 32, of Hico, Texas – previously pleaded guilty to federal charges in Los Angeles related to rhino horn trafficking.
In their plea agreements, Jimmy and Felix Kha each admitted purchasing White and Black rhinoceros horn in interstate and intrastate commerce, knowing that animals were protected by federal law as endangered and threatened species. Both defendants stated that they purchased the horns in order to export them overseas to be sold and made into libation cups or traditional medicine. Both acknowledged making payments to Vietnamese customs officials to ensure clearance of horn shipments sent to that country. In addition, Jimmy and Felix Kha each admitted to failing to pay income tax owed in 2009 and 2010.
In an earlier plea agreement, which was filed with the court on Aug. 15, 2012, Feng admitted to fraudulently and knowingly attempting to smuggle a black rhinoceros horn, an endangered species, from the United States to China. Steffen, who used money provided by the Khas to buy horns for them, pleaded guilty on June 14, 2012, to charges of conspiracy, smuggling, Lacey Act violations and money laundering.
“The Khas conspired to violate numerous federal laws, including those enacted by Congress to protect endangered species like the rhinoceros, a species that faces extinction in our time,” said Assistant Attorney General Ignacia S. Moreno. “This prosecution and continuing investigation should send a clear message that we will vigorously investigate and prosecute those who are involved in this egregious and illegal trade.”
“It is unconscionable that a species as ancient and majestic as the African Black Rhino has been hunted to the brink of extinction by unscrupulous profiteers,” said U.S. Attorney André Birotte Jr. “The rhino horn smuggling ring dismantled by Operation Crash contributed to the soaring increase in the trade of rhino horns both domestically and internationally and this illegal trade leads directly to increased poaching of the species in the wild. Operation Crash represents a giant step forward in the global fight to save a beautiful species like the Black Rhino from extinction.”
“These individuals were interested in one thing and one thing only – making money,” said FWS Director Dan Ashe. “They didn’t care about the law or about driving a species to the brink of extinction. We will continue to aggressively investigate and pursue traffickers who threaten the future of rhinos and other imperiled species.”
Rhinoceros are an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth. They have no known predators other than humans. All species of rhinoceros are protected under United States and international law, and all black rhinoceros species are endangered.
Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), a treaty signed by over 170 countries around the world to protect fish, wildlife and plants that are or may become imperiled due to the demands of international markets. Nevertheless, the demand for rhinoceros horn and black market prices have skyrocketed in recent years due to the value that some cultures have placed on ornamental carvings, good luck charms or alleged medicinal purposes, leading to a decimation of the global rhinoceros population. As a result, rhino populations have declined by more than 90 percent since 1970. South Africa, for example, has witnessed a rapid escalation in poaching of live animals, rising from 13 in 2007 to a record 448 rhinos in 2011. As of Aug. 27, the total for 2012 stood at 339 rhinos, with a predicted loss of 515 by year end if current poaching rates continue.
Operation Crash (named for the term used to describe a herd of rhinoceros) is an ongoing effort to detect, deter and prosecute those engaged in the illegal killing of rhinoceros and the unlawful trafficking of rhinoceros horns. The investigation is being led by the Special Investigations Unit of the FWS Office of Law Enforcement and involves a nationwide task force of FWS special agents focused on rhino trafficking.
The first superseding information, plea agreements and statements made during court proceedings document the following facts:
During the conspiracy, beginning in January 2010 and continuing to February 2012, Felix Kha would contact Steffen and others regarding individuals located throughout the United States who were willing to sell white or black rhinoceros horn. On various dates, Jimmy Kha met with others who traveled to Long Beach, Calif., from various locations to provide compensation for previous rhinoceros horn purchases and shipments and to provide money to fund future purchases and shipments of rhinoceros horn. Jimmy and Felix Kha received, bought, sold and facilitated the transportation of black rhinoceros horn, prior to exportation, knowing that such rhinoceros horn was intended for exportation and that it was illegal under U.S. law to do so. Jimmy Kha paid, on average, between $5,000 to $7,000 per pound of rhinoceros horn. The black and white rhinoceros horn acquired by the defendants has a fair market value between, at a minimum, $1 million to $2.5 million.
Feng attempted to export a black rhinoceros horn, which he had obtained from the Khas, from the U.S. to China, by concealing the horn at the bottom of a package. The package, which was deposited with the U.S. Postal Service, contained a single black rhinoceros horn concealed under a layer of chocolates, cigarettes, biscuits, candy, sponges and packing materials. F eng falsely declared on a U.S. Postal Service Customs Declaration that the package contained “handcraft decorations” with a value of $25, “chocolate” with a value of $46, and “candy” with a value of $15.
As a supplier for the Khas, Steffen bought and mailed dozens of rhino horns to the pair and made at least 10 trips to California to pick up payment and collect money for additional purchases. On the last of these trips, Transportation and Security Administration officers, acting at the FWS’s request, stopped Steffan and two travel companions at the airport in Long Beach before they boarded their homebound flight and retrieved $337,000 from their luggage.
In February 2012 at the time of the arrest of Jimmy and Felix Kha, FWS agents seized, among other items, rhinoceros mounts, rhinoceros horns, an additional $1 million in cash, approximately $1 million in gold ingots, jewelry, watches, precious stones, a 2009 BMW 759 Li Sedan and a 2008 Toyota Forerunner.
Jimmy and Felix Kha each pleaded guilty to one count of conspiracy (maximum penalty of five years in prison), one count of smuggling goods from the United States (maximum penalty of ten years in prison), one count of Lacey Act trafficking (maximum penalty of five years in prison), one count of money laundering (maximum penalty of twenty years in prison), and one count of tax evasion (maximum penalty of five years in prison). Win Lee Corp. faces additional penalties, including fines totaling up to $1 million. Under the terms of their plea agreements, all of the items recovered from their residence, person, and Jimmy Kha’s business will be forfeited. In addition, Felix Kha will pay a tax fraud penalty and assessment of approximately $109,000, and Jimmy Kha will pay a tax fraud penalty and assessment of $76,000.
Jimmy and Felix are scheduled to be sentenced by U.S. District Judge Christina A. Snyder on Dec. 10, 2012 at 2:30 p.m. Feng will be sentenced on Oct. 10, 2012, and Steffen will be sentenced on Oct. 15, 2012.
U.S. Attorney Birotte Jr. and Assistant Attorney General Moreno commended FWS and its partners for their outstanding work on this investigation. Assisting agencies included the U.S. Postal Inspection Service, the Internal Revenue Service Criminal Investigations, and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.
The case is being handled by the U.S. Attorney’s Office for the Central District of California and the Environmental Crimes Section of the U.S. Department of Justice’s Environment and Natural Resources Division. Assistant U.S. Attorneys Joseph O. Johns and Dennis Mitchell and Shennie Patel, a Trial Attorney with the Environmental Crimes Section, are in charge of the prosecution.
Member of Philadelphia La Cosa Nostra<br /> <br /> Sentenced to 51 Months in PrisonRead the Press Release
Gaeton Lucibello, 59, of Philadelphia, was sentenced today to 51 months in prison for his participation in a racketeering conspiracy involving extortion and illegal gambling, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney Zane David Memeger of the Eastern District of Pennsylvania and George C. Venizelos, Special Agent in Charge of the FBI’s Philadelphia Division.
Lucibello was sentenced by U.S. District Judge Eduardo C. Robreno in the Eastern District of Pennsylvania. In addition to his prison term, Lucibello was ordered to serve three years of supervised release. On Aug. 2, 2012, Lucibello pleaded guilty to conspiring to conduct and participate in the affairs of the Philadelphia La Cosa Nostra (LCN) Family through a pattern of racketeering activity. At the time of the plea, he admitted to the court that he assisted in shaking down a bookmaker for “street tax” payments and operated two illegal video poker machine businesses in furtherance of the racketeering conspiracy.
Lucibello was among 14 members and associates of the Philadelphia LCN Family charged with crimes involving racketeering conspiracy, extortion, loan sharking, illegal gambling, witness tampering and theft from an employee benefit plan in a third superseding indictment returned by a federal grand jury in Philadelphia on July 25, 2012. The other defendants charged in the 52-count third superseding indictment included Philadelphia LCN Family boss Joseph Ligambi, Philadelphia LCN Family underboss Joseph Massimino, George Borgesi, Martin Angelina, Anthony Staino Jr., Damion Canalichio, Louis Barretta, Gary Battaglini, Robert Verrecchia, Eric Esposito, Robert Ranieri, Joseph Licata and Louis Fazzini.
Angelina pleaded guilty to racketeering conspiracy charges on Aug. 8, 2012, and is awaiting sentencing on Sep. 17, 2012. Barretta also pleaded guilty to racketeering conspiracy charges on Sep. 5, 2012, and is awaiting sentencing on Nov. 26, 2012.
The trial for Ligambi, Massimino, Borgesi, Staino Jr., Canalichio, Battaglini, Licata and Fazzini is scheduled for Oct. 9, 2012. The trial for Verrecchia, Esposito and Ranieri has not yet been scheduled. Ligambi, Massimino, Borgesi, Canalichio, Licata and Fazzini are detained while awaiting trial. Staino Jr., Battaglini, Verrecchia, Esposito and Ranieri are on bond while awaiting trial.
The case is being prosecuted by Trial Attorney John S. Han of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys Frank A. Labor III and Suzanne B. Ercole of the Eastern District of Pennsylvania. Valuable prosecutorial assistance was provided by the Pennsylvania Office of the Attorney General.
The case is being investigated by the FBI, the Internal Revenue Service-Criminal Investigation, the Pennsylvania State Police, the New Jersey State Police, the Philadelphia Police Department, the U.S. Department of Labor’s Office of Inspector General Office of Labor Racketeering and Fraud Investigations, and the U.S. Department of Labor’s Employee Benefits Security Administration. Additional assistance was provided by the New Jersey Department of Corrections.
Federal Court Bars Three Pennsylvania Menfrom Preparing Tax ReturnsRead the Press Release
A federal court in Philadelphia has permanently barred Deron O. Joe of Darby, Pa.; Edmund G. Dassin of Lansdowne, Pa.; and James M. Tokpawhiea of Philadelphia from preparing federal tax returns for others, the Justice Department announced today. The three men consented to the civil injunction order without admitting the allegations against them. Judge Paul S. Diamond of the U.S. District Court for the Eastern District of Pennsylvania signed the injunction.
According to the government complaint in the case, the defendants operated a tax preparation business called Edron Tax Professionals in Philadelphia until August 2011, when they changed the name to Urban Tax Professionals and moved the office to Collingdale, Pa. The complaint alleged that the defendants, three Liberian nationals who prepared tax returns for primarily Liberian clientele, repeatedly prepared fraudulent federal income tax returns that intentionally understated customers’ tax liabilities. Their methods allegedly included claiming bogus first-time-homebuyer credits and earned-income credits in order to claim large tax refunds. According to the complaint, Joe and Dassin told one employee to claim the first-time-homebuyer credit on every return he prepared.
The court required the defendants to send a copy of the order to all persons for whom they have prepared a federal tax return since 2009, and to give the government a list of those customers.
In the last decade, the Justice Department’s Tax Division has obtained hundreds of injunctions to stop tax fraud promoters and unscrupulous tax return preparers. Information about these cases is available on the Justice Department’s website .
Related documents:
United States v. Deron O. Joe, et al., Stipulated Order and Judgment of Permanent Injunction (Edmund G. Dassin), Stipulated Order and Judgment of Permanent Injunction (Deron O. Joe), Stipulated Order and Judgment of Permanent Injunction (James M. Tokpawhiea)
13 September 2012
Statement from Attorney General Eric Holder on the 18th Anniversary of the Violence Against Women ActRead the Press Release
Attorney General Eric Holder released the following statement today on the 18th anniversary of the Violence Against Women Act:
“Since the landmark Violence Against Women Act (VAWA) became law 18 years ago today, VAWA has vastly improved our ability to address domestic violence, dating violence, sexual assault, and stalking and has helped countless victims of these crimes get access to needed services. It’s important to remember that none of this progress has been inevitable - it has been the result of the tireless work of advocates, law enforcement, prosecutors, and others. On the front lines of this effort, the Office on Violence Against Women administers VAWA programs, providing states, territories, local and tribal governments, and nonprofit organizations with critical resources to initiate and sustain efforts to reduce and stop violence against women. As Congress moves to consider reauthorizing this critical law, we urge lawmakers to come together on a bipartisan basis, as it has historically, to pass a VAWA reauthorization that expands rather than limits victim access to justice and strengthens law enforcement and prosecutorial tools to seek justice and hold violators accountable. VAWA has been strengthened each time it has been reauthorized, with bipartisan support, and this year after 18 years of progress, it should be no different.”
New York Business Owners Plead Guilty to Tax EvasionRead the Press Release
Mendy Gorodetsky and Shalom Rabkin, both residents of Brooklyn, N.Y., pleaded guilty today in U.S. District Court in the Eastern District of New York to tax evasion, the Justice Department and Internal Revenue Service (IRS) announced.
According to court records and admissions made by the defendants, Gorodetsky and Rabkin co-owned Asbestways Services Corp., an asbestos abatement and lead testing company located in Brooklyn. Gorodetsky and Rabkin attempted to evade their income taxes by not reporting the income they earned from Asbestways. In addition, Gorodetsky and Rabkin spent Asbestways corporate funds for personal use by charging personal expenses on an Asbestways corporate credit card. They cashed Asbestways gross receipts checks at a check cashing company and used the unreported cash proceeds for personal expenses. When Gorodetsky and Rabkin filed their 2006 individual income tax returns, they each falsely reported earning no income from Asbestways.
Gorodetsky admitted that he underreported his income by at least $709,134 and that his criminal conduct between 2006 and 2008 caused a tax loss to the IRS of at least $188,757. Rabkin admitted that he underreported his income by at least $598,491 and that his criminal conduct between 2006 and 2008 caused a tax loss to the IRS of at least $148,999.
Gorodetsky and Rabkin each face a potential maximum sentence of five years in prison and a fine of up to $250,000. Sentencing is set for Dec. 10, 2012, before U.S. District Judge Jack B. Weinstein.
The case was investigated by IRS - Criminal Investigation and is being prosecuted by Trial Attorneys Mark Kotila and Jeffrey Bender of the Justice Department’s Tax Division.
Justice Department and the City of Portland, Ore., Reach Preliminary Agreement on Reforms Regarding Portland Police Bureau’s Use of Force Against Persons with Mental IllnessRead the Press Release
The United States and the city of Portland, Ore., announced today that they have reached a preliminary agreement to make changes to Portland Police Bureau policies, practices, training and supervision. This agreement was reached following a comprehensive investigation. Together with the agreement, the Justice Department today announced its findings that the Portland Police Bureau (PPB) has engaged in an unconstitutional pattern or practice of excessive force against people with mental illness. The Justice Department delivered a letter detailing the findings to Portland Mayor Sam Adams and Police Chief Michael Reese, who were cooperative throughout the department’s investigation.
The investigation, launched on June 8, 2011, and conducted by the Civil Rights Division’s Special Litigation Section and the U.S. Attorney’s Office for the District of Oregon, focused on whether PPB engages in unconstitutional or unlawful policing through the use of excessive force, with a particular interest in the use of force against people with mental illness or in mental health crisis. While the Justice Department found that most uses of force by PPB officers was lawful and reasonable, it also found reasonable cause to believe that PPB engages in a pattern or practice of excessive force, in violation of the Fourth Amendment of the U.S. Constitution and the Violent Crime Control and Law Enforcement Act of 1994, in certain contexts.
This finding is set against the backdrop of a larger mental health system that has gaps in services. The absence of a comprehensive community mental health infrastructure often shifts to law enforcement agencies throughout Oregon the burden of being first responders to individuals in mental health crisis. The Justice Department is working separately with state officials in a collaborative manner to address the broader issues.
Specifically, the Justice Department found that PPB uses excessive force during interactions with people who have or are perceived to have mental illness. These uses of force against persons with mental illness are manifest in three ways: (1) encounters too frequently result in a higher level of force than necessary; (2) officers use electronic control weapons (ECW), commonly referred to as “Tasers,” in circumstances when such force is not justified, or deploy ECWs more times than necessary on an individual; and (3) officers use a higher degree of force than justified for low level offenses.
DOJ and the City of Portland have preliminarily reached an agreement that will address the following:
- Use of force policies to ensure that officers have necessary guidance when encountering someone with mental illness or perceived to have mental illness. In particular, the City will enhance its policy guidance on the use of ECW and techniques to de-escalate encounters arising from non-criminally related well-being checks and arrests for low level offenses;
- Increase capacity for crisis intervention with specially-trained officers and civilians;
- Enhance the early warning system to identify gaps in policy, training and supervision;
- Expedite the investigations of complaints of misconduct while preserving the thoroughness and quality of investigations and community participation; and
- Create a body to ensure increased community oversight of reforms.
The agreement will be filed with the court, but the action will be dismissed and the court will review compliance only upon an assertion by the United States of a material breach that cannot be resolved though good faith negotiations between the parties. The city and the United States have committed to have a final agreement by Oct. 12, 2012.
“We are gratified by the city’s response, especially the response of Chief Reese and Mayor Adams, to our findings. While our investigation has revealed that inadequate systems of supervision and oversight and the absence of specialized training have permitted particular use of force violations to persist at the Portland Police Bureau, we are confident that the steps already taken and those contained in our tentative agreement will provide meaningful and sustainable reform.” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division.
“Police officers have one of the most difficult jobs in the world. They are sworn to serve and protect, and these findings highlight where there has been a breakdown in that solemn vow,” said Amanda Marshall, U.S. Attorney for the District of Oregon. “These findings against PPB lay the framework for us to make meaningful changes that will not only make our community safer, but will empower Portland’s police officers to be more effective as trusted public servants. We all agree with the fundamental principal that all citizens, especially our most vulnerable, must be able to trust the police to protect their civil rights.”
The city and the United States recognize that these issues are of significant concern to the Portland community. Throughout the investigation, both the United States and the city have engaged in extensive community outreach. The current discussions between the parties have been informed by that community input. However, both the United States and the city will benefit from additional views of community members and leaders and will seek additional input in coming days and weeks. The United States invites those who have input that they want to share about this process to contact us.
For more information on the Justice Department’s Civil Rights Division, please visit www.justice.gov/crt . If you have any comments or concerns specific to this matter, please feel free to contact us at [email protected] or 1-877-218-5228.
Related Materials:
Portland, Ore. - Letter of Findings