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29 October 2009
Alabama Grease Haulers Charged with Clean Water Act Violations for Dumping into Mobile Area SewersRead the Press Release
WASHINGTON – A Mobile, Ala., grand jury has indicted a waste disposal company, its president and top manager for offenses involving the illegal disposal of waste into the sewage treatment systems of Mobile and of neighboring municipalities, the Justice Department and the Environmental Protection Agency (EPA) announced today.
DHS Inc., operating under the name Roto Rooter; its president, Donald Gregory Smith; and manager William Wilmoth Sr. were charged today in a forty-three count indictment with numerous violations of the Clean Water Act and with fraud and conspiracy for having dumped into local sewers thousands of gallons of waste grease and oil that they had been hired to dispose of safely and legally. The indictment recites Mobile’s history of years of sewage overflows, inadequate wastewater treatment and polluting effluent caused by blockages of sewer lines and treatment works with solidified grease.
In response to lawsuits under the Clean Water Act, the city of Mobile entered into a court ordered agreement with EPA under which Mobile implemented a grease control program requiring restaurants and other food service establishments to install grease traps to prevent cooking oils from entering the sewer system. The indictment charges that Roto Rooter, on the representation that it would pump out the grease traps of restaurants and other commercial customers and dispose of their grease waste at legal facilities, instead discharged the grease through grease traps and manholes into the sewer lines that the defendants were being paid to prevent it from entering.
Roto Rooter employee, Michael L. Edington has entered guilty pleas today in federal district court in Mobile to having dumped from Roto Rooter pump trucks numerous loads of grease into area sewer systems between 2004 and 2006, to having falsified grease tracking manifests to make it appear that the waste had been disposed of properly, and to having conspired with the defendants named in the indictment to commit the illegal disposals and fraud with which they have all been charged.
Individuals who are found to have violated the Clean Water Act are subject to up to three years of incarceration per count, twenty years in prison for fraud, as well as monetary penalties.
The matter is being handled by the Justice Department’s Environmental Crimes Section, the U.S. Attorney’s Office for the Southern District of Alabama and EPA’s Criminal Investigation Division.
An indictment is a determination by a grand jury that there is probable cause to believe that offenses have been committed by a defendant. A defendant, of course, is presumed innocent until and unless he or she is proven guilty at trial.
28 October 2009
Justice Department Signs Agreement with Laporte County, Indiana, to Ensure Civic Access for People with DisabilitiesRead the Press Release
The Justice Department today announced an agreement with LaPorte County, Ind., to improve access to all aspects of civic life for persons with disabilities. The agreement was reached under the department's Project Civic Access initiative, which aims to bring state and local governments into compliance with the Americans with Disabilities Act (ADA). This agreement is the 169th under Project Civic Access and the eighth this year.
"Civic access is a civil right, and individuals with disabilities must have the opportunity to participate in public programs, services and activities on an equal basis with their neighbors," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "We appreciate LaPorte County’s commitment to ensuring that the civil rights promised in the Americans with Disabilities Act are granted to individuals with disabilities who live in or visit the county."
LaPorte County, founded in 1832, is located in northwestern Indiana, near the Chicago metropolitan area. More than 16 percent of the residents of LaPorte County have disabilities and will benefit from the agreement announced today.
Under today's agreement, the county will:
- Make physical modifications to its buildings and parks so that parking, entrances, routes, toilet rooms, courtrooms, assembly areas, service counters and drinking fountains are accessible to persons with disabilities;
- Post, publish and distribute a notice to inform members of the public of the provisions of the ADA and their applicability to county programs, services, and activities;
- Amend its employment policies, as necessary, to comply with the regulations of the U.S. Equal Employment Opportunity Commission implementing the employment provisions of the ADA;
- Provide auxiliary aids necessary to ensure effective communication with persons who are deaf or hard of hearing and persons who are blind or have low vision;
- Ensure that each 9-1-1 call station is equipped with a text telephone (TTY) or computer equivalent and that TTY calls are answered promptly and correctly;
- Implement the La Porte County Sheriff Department’s Policy on Effective Communication with People Who are Deaf or Hard of Hearing, which provides for the county to make available interpreters and other auxiliary aids necessary to ensure effective communication with persons who are deaf or hard of hearing;
- Provide accessible polling places;
- Implement emergency management policies and procedures to ensure equal access for persons with disabilities, including preparation, notification, sheltering and response;
- Make modifications necessary to county sidewalks and curb ramps to provide accessible routes; and
- Ensure that the county’s official Web site is accessible to persons with disabilities, including people who are blind or have low vision.
The settlement agreement will remain in effect for three years from Oct. 28, 2009, or until all actions required by the agreement have been completed, whichever is later.
Project Civic Access was initiated to ensure that persons with disabilities have an equal opportunity to participate in civic life. As part of the project, department investigators, attorneys and architects conduct on-site surveys of state and local government programs and facilities in order to identify modifications needed for compliance with ADA requirements. The agreements contain a plan setting out the specific steps a community will take to improve access for persons with disabilities.
People interested in finding out more about the ADA, today's agreement with LaPorte County, Ind., or the department's Project Civic Access initiative may find this information on the ADA Web site at http://www.ada.gov or may call the toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TTY).
Justice Department Settles Lawsuit Against Nevada Company to Enforce the Employment Rights of Air Force ReservistRead the Press Release
WASHINGTON – The Justice Department announced today that it has reached a settlement that will resolve its suit filed on behalf of former Utah Army National Guardsman and current Air Force Reservist Matthew T. Denning against Stonescape Pavers LLC. The settlement must be approved by the federal court in Las Vegas. The Department’s complaint, filed in June 2009, alleges that Stonescape violated the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) by terminating Denning during his statutorily protected reemployment time period. Under the terms of the settlement, embodied in an agreement that has been submitted to the court, Stonescape must provide Denning with $10,000 to compensate him for his lost wages and benefits as a result of Stonescape’s actions.
In its complaint, the Justice Department alleged that Denning was a salesman for Stonescape when he was called to active duty to deploy to Iraq with the Utah Army National Guard in January 2006. After he was honorably discharged in June 2006, he was reemployed by Stonescape. According to the complaint, Stonescape terminated Denning without cause in August 2006 during his statutorily-protected reemployment time period. The lawsuit was filed after the Labor Department’s Veterans’ Employment and Training Service completed an investigation of Denning’s complaint. Congress enacted USERRA in 1994 to protect service members from being disadvantaged in their civilian careers due to serving in the uniformed services. Among other things, USERRA prohibits employers from terminating a service member except for cause for 180 days after the employee’s date of reemployment if his or her recent period of uniformed service was more than 30 days but less than 181 days.
"We all have a duty to ensure the brave men and women who serve our country in uniform can land on their feet after they return from active duty. This settlement demonstrates our vigilant protection of the employment rights of our servicemembers, and our commitment to vigorous enforcement of the laws that protect them," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division.
The Justice Department’s Civil Rights Division has given a high priority to the enforcement of servicemembers’ rights under USERRA. During 2009, the Civil Rights Division has filed 20 USERRA lawsuits on behalf of service members. Additional information about USERRA can be found on the Justice Department’s Web sites at http://www.justice.gov/crt/emp and http://www.servicemembers.gov/, as well as on the Labor Department’s Web site at http://www.dol.gov/vets/programs/userra/main.htm
Government Files Seven Lawsuits Nationwide to Block Alleged Scheme Involving Fraudulent Tax-Refund ClaimsRead the Press Release
WASHINGTON - The United States this week has filed civil injunction lawsuits across the country against seven individuals, the Justice Department announced today. The federal suits – filed in Los Angeles; Panama City, Fla.; Salt Lake City; Nashville, Tenn.; and Pocatello, Idaho – allege that the defendants promote a tax fraud scheme designed to siphon hundreds of millions of dollars from the U.S. Treasury through fraudulent tax refund claims.
Papers filed in the cases say the defendants prepared tax returns requesting a total of $562.4 million in bogus refunds. One defendant – Dick Jenkins, of Heber City, Utah – allegedly holds himself out as a CPA and requested a $210 million fraudulent refund for one customer. The Internal Revenue Service (IRS) catches the vast majority of the bogus tax returns and blocks the claimed refunds.
Under the tax fraud scheme, known as the "redemption" or "OID redemption" scheme, participants file a series of false IRS forms, including tax returns, amended returns, and Forms 1099 (including Form 1099-OID) or Forms W-2, to request fraudulent tax refunds based on phony claims of large income tax withholding. According to papers filed in these cases and earlier cases against other alleged scheme promoters, redemption scheme promoters are tax defiers who falsely tell customers that the federal government maintains "secret" accounts of money for its citizens. Promoters claim to be able to help customers access the secret funds by filing the false IRS forms.
Altogether, according to the IRS, redemption scheme participants (including customers of the defendants in the seven lawsuits filed this week) have requested a total of $3.3 trillion in fraudulent refunds.
"The scope of the misconduct alleged in these lawsuits is staggering," said John A. DiCicco, Acting Assistant Attorney General for the Justice Department’s Tax Division. "The IRS and Justice Department are working together closely to ensure that those who promote or participate in this large-scale attempted raid on the Treasury face all appropriate civil and criminal sanctions. Anyone who participates in this scheme can expect to not get the claimed refund, face very large civil penalties (up to 20 percent of the false claim), and where appropriate, face criminal prosecution with possible substantial prison sentences if convicted."
The Justice Department has previously brought other injunction suits to shut down redemption scheme promoters. A federal court in Sacramento found that tax preparer Teresa Marty had been using the same scheme to claim bogus refunds for her customers, and preliminarily barred her from preparing tax returns for others. The Government sued Nyla McIntyre and her Los Angeles-based company, Approved Financial Services Inc., to permanently bar them from preparing tax returns for others.
Listed below are details of the seven lawsuits, filed in U.S. District Courts in the cities indicated:
Case
Fraudulent "Refunds" Requested
United States v. Dick Jenkins
Salt Lake City, Utah
$393 million
United States v. Susan Guan
Los Angeles, California
, et al.$4.5 million
United States v. Jacqueline Cornejo
Los Angeles, California
$12.1 million
United States v. Evelyn Johnston, et al.
Panama City, Florida
$17.5 million
United States v. Thanh Cao
Los Angeles, California
$34 million
United States v. Penny Jones
Pocatello, Idaho
$93 million
United States v. Karen Miller
Nashville, Tennessee
$8.3 million
TOTAL:
$562.4 million
The Tax Division also prosecutes criminal cases involving the redemption scheme and other schemes involving fraudulent uses of IRS forms, including Forms 1099. These prosecutions often result in significant prison sentences. In May 2009 in the Southern District of Florida, Willie Bernard Cameron was sentenced to 60 months in prison for filing a false $2.9 million refund claim based on a fictitious Form 1099-OID. At the sentencing hearing, Cameron espoused tax-defier positions, including sovereignty and redemption. Other successful prosecutions have involved the use of fraudulent Forms 1099 to harass federal and state officials. In May 2009 in the Northern District of Ohio, Jeanne Herrington was sentenced to 96 months in prison for conspiracy to defraud the IRS and for retaliating against federal prosecutors by filing false Forms 1099 in their names. In May 2009 in the Central District of California, Giancarlo Pertile was sentenced to 60 months incarceration and fined $75,000. Evidence at sentencing showed that, after his indictment for tax evasion, Pertile filed Forms 1099-OID against the judge and others.
In the past decade, the Justice Department’s Tax Division has obtained more than 430 injunctions against tax fraud promoters and dishonest tax return preparers. Information about these cases is available on the Justice Department’s Web site.
Former West Point Employee Pleads Guilty in $3 Million<br /> Embezzlement SchemeRead the Press Release
A Highland Falls, N.Y., woman pleaded guilty today for her role in a scheme to defraud and embezzle funds from the U.S. government by authorizing nearly $3 million in payments from the U.S. Military Academy in West Point, N.Y., to a bogus corporation she controlled.
Bobbie Cyana Ryan, 51, pleaded guilty before U.S. District Judge Colleen Kollar-Kotelly to a three-count information charging her with devising a scheme to defraud, and transmitting funds in interstate commerce for the purpose of executing the scheme; embezzlement and conversion by Ryan of government funds; and executing a financial transaction with criminally derived funds.
According to court documents filed in U.S. District Court in the District of Columbia, Ryan worked in the Information, Education and Technology division in the Office of the Dean at West Point. Ryan was responsible for coordinating information technology training programs for West Point staff. According to court documents, based on irregularities found during a routine audit, U.S. Army investigators discovered that Ryan, acting as the requesting and approving official, used her government purchase card and cards of her unknowing subordinates to authorize approximately $2.9 million in payments to CWG Enterprises. The payments were purportedly for either on-site training instructors or training reference materials when, in fact, no personnel were ever trained and no materials were ever provided.
U.S. Army investigators subsequently discovered that Ryan conducted financial transactions and identified herself as doing business as CWG Enterprises. Ryan used a rented mail box as the company address for CWG Enterprises. Based on false invoices created by Ryan, transfers of government funds were allegedly made from a bank in Washington to a bank account in the name of "Bobbie C. Ryan dba CWG Enterprises" at a bank in New Windsor, N.Y. Once the funds arrived in the purported CWG Enterprises bank account, Ryan withdrew the funds and paid personal and family expenses.
At sentencing, scheduled for Feb. 19, 2010, Ryan faces a maximum sentence of 40 years in prison a fine of up to twice the pecuniary gain from the scheme.
The case is being investigated by the U.S. Army Criminal Investigation Command, Hartford Fraud Resident Agency. The case is being prosecuted by Senior Trial Attorney Andrew Levchuk of the Criminal Division’s Public Integrity Section.
Former Subcontractor Representative Pleads Guilty to Indictment Involving Conspiracy at New Jersey Superfund SiteRead the Press Release
WASHINGTON — A former New Jersey subcontractor representative pleaded guilty today to charges contained in an indictment involving his role in kickback and fraud conspiracy at a U.S. Environmental Protection Agency (EPA) Superfund site in New Jersey, announced the Department of Justice.
James E. Haas Jr., a former representative of a subcontractor that provides common backfill, a type of soil material used to refill an excavation, pleaded guilty in the U.S. District Court of New Jersey, to charges that he engaged in a kickback and fraud conspiracy at the Federal Creosote Superfund site in Manville, N.J. Haas admitted to paying kickbacks to former employees of a prime contractor at Federal Creosote in exchange for the award of a subcontract. He also admitted to inflating prices for the subcontract to include the amount of the kickbacks paid to his co-conspirators. Haas also pleaded guilty to committing fraud against the United States. The indictment was filed on Aug. 31, 2009. Sentencing is set for Feb. 8, 2010. The remaining individuals charged in the indictment, John A. Bennett, the former chief executive officer of subcontractor Bennett Environmental Inc. (BEI), and Gordon D. McDonald, a former project manager for a prime contractor, await trial, which is set for Jan. 5, 2010.
Separately, Frederick Landgraber of Bridgewater, N.J., the president and co-owner of a Martinsville, N.J., landscaping company was sentenced today to serve five months in jail, five months of home detention and to pay a $5,000 criminal fine for his role in a related kickback and fraud conspiracy at Federal Creosote. Landgraber was also ordered to pay $35,000 in restitution to the EPA, jointly and severally with his co-conspirators. Landgraber originally pleaded guilty on June 25, 2009, in the U.S. District Court of New Jersey, to conspiring to defraud the EPA from approximately March 2002 until approximately June 2005.
The clean-up at the Federal Creosote site is partly funded by the EPA. Under an interagency agreement between the EPA and the Army Corps of Engineers, prime contractors oversaw the removal, treatment and disposal of contaminated soil, as well as other operations at the Federal Creosote site.
Today’s plea and sentencing are the result of an ongoing federal antitrust investigation being conducted by the Antitrust Division’s New York Field Office, the EPA Office of Inspector General and the Internal Revenue Service Criminal Investigation. To date, a total of three companies and eight individuals have pleaded guilty as a part of the investigation. BEI was sentenced on Dec. 15, 2008, to pay criminal fines and restitution totaling more than $2.66 million. Christopher Tranchina was sentenced on July 13, 2009, to serve 20 months in jail and to pay restitution totaling $154,597. The other individuals and companies are awaiting sentencing.
Today’s proceedings reflect the Department’s commitment to protecting U.S. taxpayers from procurement fraud through its creation of the National Procurement Fraud Task Force. The National Procurement Fraud Initiative, announced in October 2006, is designed to promote the early detection, prosecution, and prevention of procurement fraud associated with the increase in contracting activity for national security and other government programs.
Anyone with information concerning bid rigging, kickbacks or fraud relating to subcontracts awarded at the Federal Creosote Superfund site or the Diamond Alkali Superfund site should contact the New York Field Office of the Antitrust Division at 212-264-9308.
Bill Allen and Richard Smith, Former Officers of VECO Corporation, Sentenced for Roles in <br /> Alaska Public Corruption SchemeRead the Press Release
WASHINGTON – Bill J. Allen and Richard L. Smith were each sentenced in separate hearings today for their participation in a corruption scheme in which they provided approximately $395,000 in corrupt payments to public officials from the state of Alaska, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division. Allen and Smith were sentenced in U.S. District Court for the District of Alaska by U.S. District Court Judge John W. Sedwick.
Allen, 72 , the former chief executive officer of VECO Corporation, was sentenced to 36 months in prison, a $750,000 fine and three years of supervised release. Smith, 64 , the former vice president of community and government affairs for VECO Corporation, was sentenced to 21 months in prison, a $10,000 fine and three years of supervised release.
Both defendants pleaded guilty on May 7, 2007, to three-count informations charging each with bribery; conspiracy to commit bribery, extortion under color of official right, and honest services mail and wire fraud; and conspiracy to defraud the Internal Revenue Service (IRS) of the U.S. Department of the Treasury. According to court documents, Allen and Smith conspired with at least five members of the Alaska legislature to provide illegal financial benefits to several Alaska elected officials in exchange for those officials’ support on legislation pending before the Alaska state legislature. Allen and Smith also pleaded guilty to one substantive count of bribery, and admitted that they provided approximately $395,000 in benefits to public officials from the state of Alaska in connection with the scheme.
The Allen sentencing was handled by Deputy Chief James M. Trusty of the Criminal Division’s Gang Unit, Trial Attorney Kevin R. Gingras of the Criminal Division’s Appellate Section and Trial Attorney Peter M. Koski of the Criminal Division’s Public Integrity Section. The Smith sentencing was handled by Trial Attorney M. Kendall Day and Deputy Chief Raymond Hulser of the Criminal Division’s Public Integrity Section. The case is being investigated by the FBI and IRS Criminal Investigation.
27 October 2009
Two Chicago Men Charged in Connection with Alleged Roles <br /> in Foreign Terror Plot That Focused on Targets in DenmarkRead the Press Release
Two Chicago men have been arrested on federal charges for their alleged roles in conspiracies to provide material support and/or to commit terrorist acts against overseas targets, including facilities and employees of a Danish newspaper that published cartoons of the Prophet Mohammed in 2005, federal law enforcement officials announced today. There was no imminent danger in the Chicago area, officials said, adding that the charges are unrelated to recent terror plot arrests in Boston, New York, Colorado, Texas and central Illinois.
The defendants charged in separate criminal complaints unsealed today in U.S. District Court in Chicago are David Coleman Headley, 49, and Tahawwur Hussain Rana, 48, also known as Tahawar Rana, announced Patrick J. Fitzgerald, U.S. Attorney for the Northern District of Illinois, and Robert D. Grant, Special Agent-in-Charge of the Chicago Office of the FBI. The complaints remained under seal temporarily after the defendants’ arrests, with court approval, so as not to compromise further investigative activity.
Headley, a U.S. citizen who changed his name from Daood Gilani in 2006 and resides primarily in Chicago, was arrested on Oct. 3, 2009, by the Chicago FBI’s Joint Terrorism Task Force (JTTF) at O’Hare International Airport before boarding a flight to Philadelphia, intending to travel on to Pakistan. He was charged with one count of conspiracy to commit terrorist acts involving murder and maiming outside the United States and one count of conspiracy to provide material support to that overseas terrorism conspiracy.
Rana, a native of Pakistan and citizen of Canada who also primarily resides in Chicago, was arrested on Oct. 18, 2009, at his home by federal agents. Rana is the owner of several businesses, including First World Immigration Services, which has offices on Devon Avenue in Chicago, as well as in New York and Toronto. He was charged with one count of conspiracy to provide material support to a foreign terrorism conspiracy that involved Headley and at least three other specific individuals in Pakistan.
Both men have been held in federal custody since each was arrested. If convicted, Headley faces a maximum sentence of life imprisonment for conspiracy to murder or maim persons abroad, while Headley and Rana each face a maximum of 15 years in prison for conspiracy to provide material support to terrorism.
On Oct. 18, 2009, JTTF agents executed search warrants in connection with the investigation at four locations: Headley’s and Rana’s residences on the north side of Chicago, Rana’s immigration business in Chicago, and a farm he owns in Kinsman, Ill., approximately 80 miles southwest of Chicago, which is used to provide halal meat for Muslim customers, as well as a grocery store in Chicago.
According to both complaints, since at least late 2008 until Oct. 3, 2009, as part of the conspiracy to murder and maim persons abroad, Headley allegedly identified and conducted surveillance of potential targets of a terrorist attack in Denmark on two separate trips to Denmark in January and July 2009, and reported and attempted to report on his efforts to other conspirators in Pakistan. As part of the conspiracy to provide material support to terrorism, Rana allegedly helped arrange Headley’s travels overseas and conceal their true nature and purpose to surveil potential terror targets overseas, and discussed potential targets for attack with Headley.
Headley allegedly reported and attempted to report on his overseas surveillance to other conspirators, according to the affidavits, including:
Ilyas Kashmiri, identified as the operational chief of the Azad Kashmir section of Harakat-ul Jihad Islami (HUJI), a Pakistani-based terrorist organization with links to al Qaeda. Kashmiri, who is presently believed to be in Waziristan in the Federally Administered Tribal Area (FATA) region in northwestern Pakistan, issued a statement this month that he was alive and working with al Qaeda;
"Individual A" (who is identified as Individual A in the Headley affidavit and as Individual B in the Rana affidavit), who is associated with Kashmiri, as well as with Lashkar-e-Taiba (LeT), another Pakistani-based terrorist organization;
an individual identified as "Lashkar-e-Taiba Member A" (LeT Member A), who has substantial influence and responsibility within the organization and whose identity is known to the government.
"The public should be reassured that there was no imminent danger in the Chicago area. However, law enforcement has the duty to be vigilant to guard against not just those who would carry out attacks here on our soil but those who plot on our soil to help carry out violent attacks overseas. I wish to express my deep appreciation to the FBI agents and other members of the Joint Terrorism Task Force for their extremely hard work on this matter," said Mr. Fitzgerald.
"The criminal complaints unsealed today have exposed a serious plot against overseas targets by two Chicago-based men working with Pakistani-based terrorist organizations. Information developed during this investigation was shared with our foreign partners as we worked together to mitigate these threats. This case is a reminder that the threat posed by international terrorist organizations is global in nature and requires constant vigilance at home and abroad," said David Kris, Assistant Attorney General for National Security.
"This investigation demonstrates the well-established relationships that we have with our law enforcement partners, both foreign and domestic. We work closely with state, local and federal law enforcement agencies in the United States, as well as with our overseas partners, to identify and disrupt threats here and abroad," said Mr. Grant.
According to the affidavits in both cases, Headley at times has claimed to be a consultant with or representative of Rana’s business, First World Immigration Services, but appears to perform little if any actual work for the business. In addition, Headley’s apartment in Chicago is leased to an individual who is deceased. Despite his apparent lack of financial resources and substantial employment, Headley has traveled extensively since the second half of 2008, including multiple trips to Pakistan and various countries in Europe. Postings to an internet group for graduates of a military school in the Pakistani town of Hasan Abdal (a group that refers to itself as "abdalians"), reflect that both Rana and Headley have participated in the group and referred to their attendance at that school.
The Denmark Project
Beginning in late 2008, Headley corresponded extensively with Individual A and LeT Member A regarding what they referred to in coded communications as the "Mickey Mouse Project," "mmp," and "the northern project," according to the affidavit. The Mickey Mouse Project allegedly involved planning for one or more attacks at facilities and employees of Morgenavisen Jyllands-Posten, a Danish newspaper that in 2005 published cartoons depicting the Prophet Mohammed, to which many Muslims took great offense. In October 2008, Headley allegedly posted a message to the "abdalians" internet discussion group stating that "I feel disposed towards violence for the offending parties," referring to the Danish cartoonists and others who he identified "as making fun of Islam."
Using coded language, Rana, Headley, Individual A and LeT Member A allegedly have referred to this plot, as well as discussions of other targets, as "investments," "projects," "business," and "action," and have described their hopes for success both in terms of receiving religious awards, as well as getting "rich," "richer," and making "profit." Between August 2008 and Dec. 7, 2008, Headley sent multiple email messages from internet addresses located in Karachi and Lahore in Pakistan, the charges allege. On Dec. 7, 2008, just before traveling from Pakistan to the United States that same day, Headley alleged used one of multiple email accounts to store a detailed list of items for himself, which he titled "Mickey Mouse." Included on the list (contained in the affidavits) were the following items:
Route Design (train, bus, air)
Cross (Cover Authenticator)
Trade? Immigration?
Ad? (Lost Luggage) (Business) (Entry?)
Kings Square (French Embassy)
Counter surveillance (magic eye)
Security (armed)?
In January 2009, Headley traveled to Copenhagen, Denmark, and Rana allegedly arranged portions of his travel. During the trip, Headley allegedly visited two different offices of the Jyllands-Posten — in Copenhagen and Arhus, Denmark. The Copenhagen office is located in Kings Square near the French Embassy. Headley falsely told Jyllands-Posten employees that he was visiting on behalf of First World Immigration Services, which he said was considering opening offices in Denmark and might be interested in advertising the business in the newspaper. While in Denmark, Headley instructed Rana to be alert for an email from a Jyllands-Posten sales representative, and to ask First World’s Toronto and New York offices to "remember me," in case a newspaper representative called. According to the complaints, Rana corresponded from Chicago with a representative of the Jyllands-Posten by email in which he pretended to be Headley.
After visiting Denmark, Headley traveled to Pakistan to meet with Individual A. During this visit, Headley traveled with Individual A to Pakistan’s FATA region and met with Kashmiri. Before returning to Chicago in June 2009, Headley sent his will to Rana and Rana responded by sending a coded message establishing a new email account, the complaint alleges.
In July and August 2009, Headley exchanged a series of emails with LeT Member A, including an exchange in which Headley asked if the Denmark project was on hold, and whether a visit to India that LeT Member A had asked him to undertake was for the purpose of surveilling targets for a new terrorist attack. These emails reflect that LeT Member A was placing a higher priority on using Headley to assist in planning a new attack in India than on completing the planned attack in Denmark. After this time, Headley and Individual A allegedly continued focusing on the plan with Kashmiri to attack the newspaper, rather than working with LeT, the complaint alleges.
In late July 2009, Headley traveled again to Copenhagen and to other locations in Europe, and Rana again arranged portions of his travel. When Headley returned to the United States, he falsely told border inspectors that he was traveling on business as a representative of First World Immigration, although his luggage contained no papers or other documents relating to First World.
After returning to Chicago in August 2009, Headley allegedly used coded language to repeatedly inquire if Individual A had been in touch with Kashmiri regarding planning for the attack, and expressing concern that Individual A’s communications with Kashmiri had been cut off. In early September 2009, Headley and Rana took a lengthy car ride during which they discussed the activities of the other individuals, including past terrorist acts, and Headley discussed with Rana five actions involving targets that expressly included "Denmark." In conversations with Rana and Individual A in August and September 2009, Headley indicated that if the "doctor" (alleged to be a reference to Kashmiri) and his people were unable to assist, then Headley would perform the planned operation himself.
In September 2009, after initial press reports indicated that Kashmiri had been killed in a drone attack in Pakistan, Headley and Individual A allegedly had a series of coded conversations in which they discussed the reports of Kashmiri’s death and what it meant for the projects they were planning. Individual A sought to reassure and encourage Headley, telling him, among other things, that "[t]his is business sir; these types of things happen." On Sept. 20, 2009, Headley allegedly told a family member words to the effect that he had spoken to Rana and they agreed that "business must go on."
In a Sept. 21, 2009, telephone conversation, Individual A indicated to Headley that Kashmiri was alive and "doing well." In a subsequent conversation on Sept. 30, 2009, Individual A again assured Headley that Kashmiri, whom he referred to as "Pir Sahib," was "absolutely all right" and had not gotten "married," which was code for being killed. Headley asked Individual A if it was possible to now have a meeting with Kashmiri and Individual A responded that Kashmiri "just today, was asking about you" (Headley).
According to the affidavit, Headley stated in conversations last month that he intended to travel to Pakistan in early October to meet with Individual A and Kashmiri, and he was arrested on Oct. 3 as he prepared to board a flight from Chicago to Philadelphia, intending to travel on to Pakistan. During a search of Headley’s luggage, a memory stick was recovered that contained approximately 10 short videos of Copenhagen, including video focused on the Jyllands-Posten building in King’s Square taken both during the day and night, as well as a nearby Danish military barracks and the exterior and interior of Copenhagen’s central train station, consistent with the checklist he stored which mentioned "route design." In addition, Headley had an airline reservation, allegedly made by Rana, to fly from Atlanta to Copenhagen on Oct. 29, 2009.
The investigation is continuing and is being conducted by the Chicago FBI Joint Terrorism Task Force, with particular assistance from the Chicago Police Department, the Illinois State Police and the Department of Homeland Security.
The prosecution is being handled by Assistant U.S. Attorneys Daniel Collins and Vicki Peters from the Northern District of Illinois, with assistance from the Counterterrorism Section of the Justice Department’s National Security Division.
The public is reminded that a criminal complaint contains mere allegations that are not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Justice Department Settles Lawsuit Alleging Race Discrimination Against the City of Marion, ArkansasRead the Press Release
WASHINGTON – The Justice Department today announced that it has reached a settlement with the city of Marion, Ark., that, if approved by the U.S. District Court for the Eastern District of Arkansas, will resolve the department’s lawsuit against the city alleging race discrimination in employment in violation of Title VII of the Civil Rights Act of 1964, as amended. Title VII prohibits discrimination in employment on the basis of race, sex, national origin or religion.
The department’s complaint, filed in May 2009, alleges that the city discriminated against Stacy D. Allen, an African-American and a former part-time patrol officer in the city’s police department, when it did not appoint him as a full-time patrol officer. The complaint alleges that the police department had a history of appointing the most senior part-time patrol officer as a full-time officer when a full-time position became available. However, when Allen, who was the city’s only African-American patrol officer, became the most senior part-time patrol officer and two full-time positions opened, the city appointed two less senior white part-time patrol officers to those positions instead of Allen. The Justice Department’s complaint was based on a charge of discrimination filed by Allen with the Equal Employment Opportunity Commission.
"All Americans are guaranteed the right to know that they can pursue their career of choice without fear of discrimination based on their race," said Thomas E. Perez, Assistant Attorney General for Civil Rights. "Title VII protects individuals, such as Mr. Allen, from having to suffer discrimination in the workplace. The Justice Department will take swift action against those employers who engage in discrimination, and we appreciate the partnership of the EEOC in these matters."
The settlement agreement requires that the city not discriminate against on the basis of race, or in any way adversely affect the terms and conditions of employment of, any applicant or person employed in the city’s police department. The agreement also requires that the city provide Allen with a monetary award of $16,000 ($2,250 in back pay and $13,750 in compensatory damages).
The Civil Rights Division is committed to the vigorous enforcement of Title VII. Additional information about the Civil Rights Division is available on its Web sites at http://www.justice.gov/crt/; and http://www.justice.gov/crt/emp/.
Detroit-Area Physical Therapist Pleads Guilty <br /> in Medicare Fraud SchemeRead the Press Release
Troy, Mich., resident Syed Aziz pleaded guilty today in U.S. District Court in Detroit to participating in a conspiracy to defraud the Medicare program.
In his plea today, Aziz, a licensed physical therapist, admitted that he began working in approximately May 2005 as a contract therapist for a co-conspirator, Suresh Chand. Chand owned and controlled several companies operating in the Detroit area that purported to provide physical and occupational therapy services to Medicare beneficiaries. Aziz admitted that he, Chand, and others created fictitious therapy files appearing to document physical and occupational therapy services provided to Medicare beneficiaries, when in fact no such services were provided. According to court documents, the fictitious services reflected in the files were billed to Medicare through sham Medicare providers controlled by co-conspirators.
Chand admitted to paying cash kickbacks and other inducements to Medicare beneficiaries in exchange for the beneficiaries’ Medicare numbers and signatures on documents falsely indicating that they had received physical or occupational therapy. Chand pleaded guilty on Sept. 28, 2009, in U.S. District Court in Detroit to one count of conspiracy to commit health care fraud and one count of conspiracy to launder money. Aziz admitted that he was one of the licensed physical or occupational therapists from whom Chand obtained signatures on fictitious "progress notes" and other documents falsely indicating that the therapists had provided services to the Medicare beneficiaries.
Aziz also admitted that during the course of the scheme, he signed approximately 400 fictitious physical therapy files, indicating that he had provided physical therapy services to Medicare beneficiaries, when in fact he had not. Aziz admitted that he was paid between $70 and $90 for each file he falsified. Aziz also admitted that between approximately May 2005 and December 2006, he falsified physical therapy files that supported claims to the Medicare program totaling approximately $1,895,000. According to court documents, Medicare paid approximately $817,000 on those claims. Aziz admitted that throughout the conspiracy he was fully aware that Medicare was being billed for physical therapy services that he falsely indicated he had performed.
At sentencing, scheduled for Feb. 3, 2010, Aziz faces a maximum prison sentence of 10 years and a $250,000 fine.
The case is being prosecuted by Trial Attorneys John K. Neal, Gejaa T. Gobena and Benjamin Singer of the Criminal Division’s Fraud Section and by Special Assistant U.S. Attorney Thomas W. Beimers of the Eastern District of Michigan. The FBI and the HHS Office of Inspector General (HHS-OIG) conducted the investigation. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since the inception of Strike Force operations in March 2007 – Miami (Phase One), Los Angeles (Phase Two), Detroit (Phase Three) and Houston (Phase Four) – the Strike Force has obtained indictments of more than 331 individuals and organizations that collectively have billed the Medicare program for more than $720 million. 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.
Each of the Strike Force teams across the separate phases is led by a federal prosecutor from the Criminal Division’s Fraud Section or the U.S. Attorney’s Office. Each team has an agent from the FBI and HHS-OIG.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT) , go to: www.stopmedicarefraud.gov.
D.C. Lobbyist Indicted for Conspiring to Violate Sudanese Sanctions and to Act as Illegal Agent of SudanRead the Press Release
Robert J. Cabelly, 61, of Washington, D.C., has been indicted in the District of Columbia in an eight-count indictment charging him with conspiracy to violate the Sudanese sanctions regulations and to act as an unregistered agent of a foreign power, four counts of violating the Sudanese sanctions regulations, as well as one count apiece of money laundering, passport fraud and making false statements.
Cabelly, who was the principal and managing director of a Washington, D.C. consulting firm and a former State Department employee, is scheduled to appear in federal court today in the District of Columbia at 1:30 p.m. before U.S. Magistrate Judge Deborah Robinson. If convicted, he faces up 20 years in prison on each of the substantive Sudanese Sanctions Regulations counts, 20 years for the money laundering count, 10 years for the passport fraud, and five years each for the conspiracy and false statement counts.
According to the indictment, between early 2005 and mid-2007, Cabelly performed work on behalf of the Republic of Sudan, a country currently on the State Department’s State Sponsors of Terrorism list, without the approval of the U.S. government as is required by law under the Sudanese sanctions regulations. In an effort to make money, Cabelly brokered business contracts and transactions benefiting Sudan. He also provided Sudan with U.S. government information that was sensitive and controlled. All the while, Cabelly affirmatively misrepresented to U.S. officials the nature of his relationship with Sudan, as well as his relationship with the foreign entities doing business in Sudan.
Among other acts alleged in the indictment, Cabelly engaged in illicit contractual relationships with the oil industry in Sudan, operating as an intermediary between Sudanese government officials and oil company executives and a foreign oil company, and sought additional investors on behalf of that foreign oil company so that it could do business in the Sudan. He also allegedly provided strategic advice and counsel to Sudanese officials, including in the areas of economic development and trade, especially as it pertained to the development of the country’s petroleum natural resource and its government controlled airline industry.
According to the indictment, Cabelly was paid for these services by Sudanese government officials as well as by a foreign oil company. Cabelly allegedly directed a foreign oil company to deposit over $180,000 of the fees he received in an offshore account he maintained in the Cook Islands, an account he used to launder the funds in order to conceal the fact that it was proceeds obtained in violation of the sanctions. Cabelly also concealed his travel to the Sudan from U.S. authorities by misusing U.S. passports.
"The conduct alleged in this indictment is broad in scope and very serious," said David Kris, Assistant Attorney General for National Security. "We will continue to pursue anyone who seeks to violate U.S. sanctions."
"Those who pursue their own personal gain at the expense of our nation’s trade embargoes can expect to be aggressively prosecuted," said Acting U.S. Attorney Channing Phillips. "Our national security depends on strict enforcement of U.S. export laws such as the Sudanese Sanctions Regulations."
"The FBI is committed to enforcing all laws pertaining to U.S. persons and the representations of foreign governments to ensure those relationships aren’t counterproductive to our fight against terrorism," said Joseph Persichini, Jr., Assistant Director for the FBI’s Washington Field Office.
"The activities detailed in this indictment – including facilitation of Sudanese oil transactions – would represent serious violations of U.S. sanctions law. We commend our federal law enforcement colleagues for their dedicated and collaborative efforts," said Adam J. Szubin, Director of the Treasury Department’s Office of Foreign Assets Control.
The investigation was conducted through the collaborative efforts of the FBI’s Washington Field Office, the State Department’s Bureau of Diplomatic Security, the Naval Criminal Investigative Service (NCIS) and the U.S. Customs and Border Protection. The Department of Treasury’s Office of Foreign Assets Control (OFAC) also provided substantial assistance and cooperation throughout the course of the investigation.
The prosecution is being handled by Assistant U.S. Attorney Michael C. DiLorenzo from the U.S. Attorney’s Office for the District of Columbia, and Trial Attorney Patrick T. Murphy from the Counterespionage Section of the Justice Department’s National Security Division.
The public is reminded that a criminal indictment contains mere allegations and is not evidence of guilt. A defendant is presumed innocent unless and until proven guilty.
26 October 2009
Utah-Based Tax Shelter Operators Plead Guilty<br /> in $200 Million Dollar Tax FraudRead the Press Release
WASHINGTON – David Plummer, Spencer Plummer and Terry Green, operators of a fraudulent tax shelter that offered tax benefits in connection with the leasing of thoroughbred mares, pleaded guilty today to a criminal information charging them with one count of conspiracy to defraud the United States, the Justice Department and the Internal Revenue Service (IRS) announced.
According to the criminal information and statements made in court, the defendants called their fraudulent tax product the Mare Lease Program and marketed it through a company called ClassicStar LLC. David Plummer created the Mare Lease Program and oversaw the program at ClassicStar. Spencer Plummer assisted David Plummer in the operation of the Mare Lease Program. Terry Green was a Certified Public Accountant and assisted investors in the Mare Lease Program in preparing and filing income tax returns on which they reported fraudulent deductions. Green also assisted customers in their IRS audits by creating false and back-dated documents and presenting them to IRS auditors. The investors in the Mare Lease Program filed tax returns with the IRS claiming false tax deductions of over $500 million, which resulted in a tax loss to the Government of over $200 million.
According to the criminal information and statements made in court, ClassicStar’s Mare Lease Program purported to offer wealthy individuals the opportunity to invest in thoroughbred horse breeding. According to Mare Lease Program promotional materials, investors leased the reproductive capacity of specific thoroughbred mares. If the mare had a foal during the time that the investor held the lease, the investor would own the foal. Mare Lease Program promoters told investors that they could take deductions on their federal income tax returns for the losses generated by the thoroughbred horse breeding operation. These deductions reduced or eliminated the investors’ taxes, and many investors received tax refunds, including refunds for years prior to their investments. These deductions were fraudulent because, among other reasons, the Mare Lease Program used fraudulent loans to finance investors’ participation, and the program induced investors to lease thoroughbred mares that the operators of the program knew ClassicStar could not provide.
According to the criminal information and statements made in court, most investors financed at least 50 percent of their investments in the Mare Lease Program through loans from the National Equine Lending Company (NELC), a purportedly independent financial institution. In fact, NELC was controlled by ClassicStar. ClassicStar’s operators claimed that NELC would transfer funds to ClassicStar on behalf of an investor to finance his or her investment in the Mare Lease Program. In reality, NELC had no funds of its own and would instead accept money from ClassicStar. Typically, ClassicStar transferred insufficient funds to NELC to finance an investor’s entire loan. To conceal the lack of funds, NELC and ClassicStar repeatedly transferred the same funds between their bank accounts to create a paper trail that gave the appearance that the investor’s loan was fully funded by NELC. At the conclusion of the investor’s participation in the Mare Lease Program, the investor, often having made no payments on the supposed loan, had the loan extinguished through fictitious trades involving an entity that purportedly owned interests in coal bed methane gas wells.
According to the criminal information and statements made in court, in addition to the fraudulent lending arrangements of the Mare Lease Program, ClassicStar sold Mare Lease Program investments knowing that it lacked sufficient thoroughbred mares to fulfill its contractual obligations to the investors. To justify the deductions that the investors claimed on their income tax returns, ClassicStar substituted less-valuable quarter horse mares for the thoroughbred mares that they had promised.
"U.S. taxpayers who honestly report their income and pay their taxes can rest assured that those who promote fraudulent schemes that illegally conceal assets and income will be investigated and prosecuted by the IRS and Department of Justice," said John A. DiCicco, Acting Assistant Attorney General of the Justice Department’s Tax Division.
"Tax crimes hurt everyone, by depriving the Treasury of funds needed for important government programs. This nationwide fraudulent scheme is by far the largest criminal tax case in the history of Oregon, and we are grateful for the assistance of the Internal Revenue Service in the investigation of this case," said Acting U.S. Attorney Robinson.
The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation and is being prosecuted by Assistant U.S. Attorney and Senior Litigation Counsel Allan M. Garten and Department of Justice Tax Division Trial Attorney Jay Nanavati.
"The IRS uses all its investigative tools to uncover abusive tax schemes designed to create fraudulent deductions for investors," said Eileen Mayer, Chief, IRS Criminal Investigation. "Investment schemes that seem too good to be true should be a signal to investors to stay clear. The IRS is actively pursuing promoters as well as investors who knowingly participate in these types of tax avoidance schemes."
Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at http://www.usdoj.gov/tax.
Justice Department Settles Voting Rights Case with Lake Park, FloridaRead the Press Release
WASHINGTON – The Justice Department today announced the filing of a consent decree settling a Voting Rights Act lawsuit against the town of Lake Park, Fla., that, subject to court approval, will alter the method of electing the town commission. The town will discontinue use of its current at-large method of electing the commissioners. Lake Park will use a limited voting plan beginning with the March 2010 elections.
The lawsuit, filed on March 31, 2009, in federal court in Miami, challenged the at-large method of electing the Lake Park Town Commission on the ground that it dilutes the voting strength of African-American citizens in violation of Section 2 of the Voting Rights Act. Although African-Americans comprise over 38 percent of the town’s total citizen voting-age population, black voters usually have been unsuccessful in electing their candidate of choice and no black candidate for the commission has ever won an election since Lake Park was incorporated in 1923.
"All Americans cherish the right to have our voices heard in the voting booth, and the Voting Rights Act continues to be a vital tool allowing us to protect that right," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "We are pleased that the Lake Park Town Commission has agreed to adopt a voting plan that will provide African-American citizens with the opportunity to elect commissioners of their choice."
U.S. Attorney Jeffrey H. Sloman for the Southern District of Florida stated, "In the consent decree, the town of Lake Park conceded that there is a factual and legal basis for concluding that the current at-large method of electing the town’s commissioners results in an unfair dilution of the African-American vote. Today’s consent decree is a first step to remedying that situation and providing equal access to the political process."
Racially polarized voting patterns prevail in Lake Park elections. The department was prepared to prove through an analysis of statistical and non-statistical evidence, including past town election returns and voting patterns, that the African-American population of Lake Park is politically cohesive and that white persons usually vote sufficiently as a bloc to defeat the preferred candidate of African-American voters.
In the consent decree, the town conceded that there is a basis in both fact and law for believing that the current at-large method of electing commissioners, under all the circumstances, results in African-Americans having less opportunity to participate in the town’s political process and to elect representatives of their choice.
Under the limited voting plan systems, all four commission seats will be up for election and voters will be limited to casting a vote for only one candidate. The four candidates receiving the highest number of votes will be elected to the Lake Park Town Commission for a three-year term. The limited voting plan is in effect permanently, unless changed by the terms in the agreement and in compliance with Section 2 of the Voting Rights Act.
Complaints about discriminatory voting practices may be reported to the Justice Department at 1-800-253-3931. More information about the Voting Rights Act and other federal voting laws is available on the Department of Justice Web site at http://www.usdoj.gov/crt/voting.
Former Federal Corrections Officer Sentenced to Life in Prison on Civil Rights Charges Related to Fatal AssaultRead the Press Release
WASHINGTON – Erin Sharma, a former corrections officer with the Federal Bureau of Prisons, was sentenced today in federal court in Orlando, Fla., on federal civil rights charges related to the fatal assault of an inmate, announced Assistant Attorney General Thomas E. Perez of the Civil Rights Division and U.S. Attorney A. Brian Albritton of the Middle District of Florida. Sharma was sentenced to serve a term of life in prison, three years of post-release supervision and 75 hours of community service.
On July 29, 2009, a federal jury in Orlando found Sharma guilty of two felony federal civil rights charges related to the fatal assault of federal inmate Richard Delano in March 2005. The evidence at trial showed that on Feb. 28, 2005, Sharma and a co-conspirator agreed to move Delano into the cell of another inmate at the Coleman Federal Correctional Complex in Coleman, Fla. The evidence also showed that Sharma and the co-conspirator knew that the other inmate was likely to assault Delano and that this move was in retaliation for a prior altercation between Delano and Sharma. Sharma also encouraged the inmate to assault Delano. The co-conspirator moved Delano into the inmate’s cell on March 1, 2005, and the inmate assaulted Delano three days later, on March 4. On March 17, 2005, Delano died from the injuries he suffered during that assault.
"The brave work of our nation’s law enforcement officers must be guided by adherence to the laws they are sworn to uphold, and the overwhelming majority of officers abide by that principle," said Assistant Attorney General Perez. "When law enforcement officers betray the great trust placed in them by abusing the individuals in their custody, the Justice Department will vigorously investigate, prosecute and seek appropriate punishment for those actions."
"Nothing justifies or excuses the defendant’s outrageous conduct in this case," said U.S. Attorney A. Brian Albritton. "When correction officers make the corrupt choice to act as judge, jury and executioner, the United States will prosecute such actions aggressively, just as it did here."
The case was prosecuted by Assistant U.S. Attorneys Bruce Ambrose and Carolyn Adams from the U.S. Attorney’s Office, and Senior Litigation Counsel Gerard Hogan and Trial Attorney Douglas Kern from the Civil Rights Division. FBI Special Agent Jim Raby was the lead investigator on the case
The Civil Rights Division is committed to the vigorous enforcement of every federal criminal civil rights statute, including those laws that prohibit the willful use of excessive force or other acts of misconduct by law enforcement or other government officials.
Cuban Citizen Extradited from Latvia and Arraigned for Allegedly Trafficking Counterfeit Slot Machines and Computer ProgramsRead the Press Release
Rodolfo Rodriguez Cabrera, 43, a Cuban national, was arraigned today in U.S. District Court for the District of Nevada on charges of producing and selling counterfeit International Game Technology (IGT) video gaming machines, commonly known as slot machines, and counterfeit IGT computer programs.
Cabrera and Henry Mantilla, 35, of Cape Coral, Fla., were indicted by a federal grand jury in Las Vegas on April 22, 2009, with one count of conspiracy, two counts of trafficking in counterfeit goods, two counts of trafficking in counterfeit labels and two counts of criminal copyright infringement. According to the indictment, Cabrera and Mantilla conspired between August 2007 and April 15, 2009, to make and sell unauthorized copies of computer programs designed for IGT video slot machines and counterfeit IGT video slot machines bearing IGT’s registered trademarks, all without the permission of IGT. The indictment also contains 13 forfeiture allegations seeking forfeiture of any and all counterfeit items and up to $5 million in illegal proceeds from their alleged criminal activity.
If convicted on the conspiracy charge, each defendant faces a maximum of five years in prison and a $250,000 fine. The copyright infringement and counterfeit labels charges also carry a maximum penalty of five years in prison and a $250,000 fine, per count. The charges of counterfeit goods carry a maximum penalty of 10 years in prison and a $2 million fine, per count.
Cabrera was arrested June 8, 2009, in Riga, Latvia, and extradited from Latvia to the United States on Oct. 23, 2009. Cabrera is the first individual to be extradited from Latvia to the United States under a new extradition treaty between the U.S. and Latvia, which entered into force on April 15, 2009. Cabrera’s arrest and extradition is the result of cooperation between U.S. and Latvian law enforcement and the Latvian government. At the hearing today, Cabrera pleaded not guilty and U.S. Magistrate Judge Peggy A. Leen ordered him detained pending trial, which is scheduled to begin Dec. 8, 2009. Mantilla pleaded not guilty at his arraignment on July 2, 2009, and trial is currently scheduled for Dec. 8, 2009, before U.S. District Court Judge Phillip M. Pro.
The case is being prosecuted by Trial Attorney Thomas S. Dougherty of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) and Assistant U.S. Attorney Michael Chu of the U.S. Attorney’s Office for the District of Nevada. Significant assistance has been provided by the Central Criminal Police Department of the Latvian Ministry of Interior; Latvia’s Office of the Prosecutor General, International Cooperation Division; and Senior Trial Attorney Deborah Gaynus of the Criminal Division’s Office of International Affairs.
An indictment is merely a formal charge by the grand jury. Each defendant is presumed innocent unless and until proven guilty in a court of law.
Attorney General Holder Expands U.S. Attorney Advisory CommitteeRead the Press Release
WASHINGTON - Attorney General Eric Holder today announced the appointment of nine new U.S. Attorneys to serve two-year terms on the Attorney General’s Advisory Committee of U.S. Attorneys (AGAC). The new appointees include: U.S. Attorney for the Southern District of New York Preet Bharara; U.S. Attorney for the District of Arizona Dennis Burke; U.S. Attorney for the Western District of Washington Jenny Durkan; U.S. Attorney for the District of New Jersey Paul J. Fishman; U.S. Attorney for the Northern District of Illinois Patrick J. Fitzgerald; U.S. Attorney for the Eastern District of Virginia Neil H. MacBride; U.S. Attorney for the District of Rhode Island Peter F. Neronha; U.S. Attorney for the Northern District of Alabama Joyce White Vance; and Acting U.S. Attorney, ex officio, for the District of Columbia Channing D. Phillips. John S. Davis, Criminal Chief for the Eastern District of Virginia, was also appointed to the committee to represent the voice of the Assistant U.S. Attorneys in the field.
"This is a critical and exciting time for the Department of Justice and I will rely heavily on these U.S. Attorneys as we work to further the Department’s efforts to reduce violent crime and gang violence, promote civil rights, ensure fairness in the marketplace and above all, preserve our national security," said Attorney General Holder.
The AGAC, chaired by U.S. Attorney for the District of Minnesota B. Todd Jones, was created in 1973. The committee, which reports to the Attorney General through the Deputy Attorney General, represents the voice of the U.S. Attorneys and provides advice and counsel to the Attorney General on policy, management and operational issues impacting the Offices of the U.S. Attorneys.
"This committee provides crucial advice to the Department’s leadership in helping shape key policies to accomplish our core mission of serving justice, and these distinguished U.S. Attorneys bring the experience, dedication and drive necessary to successfully serve this important role," said Deputy Attorney General David W. Ogden.
A brief bio on each nominee is below:
Preet Bharara was presidentially appointed U.S. Attorney for the Southern District of New York on Aug. 13, 2009. Bharara previously served as Chief Counsel to U.S. Senator Charles E. Schumer (2005-2009); Adjunct Professor at Fordham University School of Law (2003-2005); Assistant U.S. Attorney for the Southern District of New York (2000-2005); litigation associate with Shereff, Friedman, Hoffman & Goodman LLP (1996-2000); and litigation associate with Gibson, Dunn & Crutcher LLP (1993-1996).
Dennis Burke was presidentially appointed U.S. Attorney for the District of Arizona on Sept. 16, 2009. Prior to his appointment, Burke served as Senior Advisor to the Secretary for Homeland Security (2009) and as a member of the Obama/Biden Transition Team (2008-2009). Burke served as Chief of Staff for the Governor of Arizona (2003-2008); Chief Deputy/Special Assistant for the Arizona State Attorney General (1999-2003); Acting Assistant Attorney General, Office of Legislative Affairs, Department of Justice (1999); Assistant U.S. Attorney for the District of Arizona (1997-1999); Senior Policy Analyst, Domestic Policy Council, The White House (1995-1997); Special Counsel, Office of Legislative Affairs, Department of Justice (1994-1995); and Majority Counsel for the U.S. Senate Judiciary Committee, Subcommittee on Patents, Copyrights and Trademarks (1989-1994).
Jenny Durkan was presidentially appointed U.S. Attorney for the Western District of Washington on Oct. 1, 2009. Durkan previously served as solo practitioner for the law offices of Jenny Durkan (1997-2009); Executive Counsel for the Office of the Governor, Washington State (1994 -1995); associate attorney (1991-1994) and shareholder (1996-1997), Schroeter, Goldmark and Bender; associate attorney, Williams and Connolly (1987-1991); and associate attorney, Foster, Pepper & Riviera (1985-1987).
Paul J. Fishman was presidentially appointed U.S. Attorney for the District of New Jersey on Oct. 14, 2009. Prior to his appointment he served as partner with Friedman, Kaplan, Seiler & Adelman LLP (1997-2009). Fishman served in the Office of the Deputy Attorney General, Department of Justice, as Principal Associate Deputy Attorney General (1997), Associate Deputy Attorney General (1995-1997) and Counsel (1994). Fishman also served as Assistant U.S. Attorney for the District of New Jersey (1983-1994).
Patrick J. Fitzgerald was presidentially appointed U.S. Attorney for the Northern District of Illinois in October 2001, and was Attorney General appointed in August-October 2001. Fitzgerald was a member of the AGAC in 2001-2004 and 2008-2009, serving as interim chair in 2009. Prior to his appointment as U.S. Attorney, Fitzgerald served in the U.S. Attorney’s Office in the Southern District of New York as Chief of the Organized Crime-Terrorism Unit (1995-2001), Chief of the Narcotics Unit (1994), and Assistant U.S. Attorney (1988-1994). Prior to joining the U.S. Attorney’s Office, Fitzgerald was a litigation associate with Christy & Viener, New York, N.Y. (1985-1988).
Neil H. MacBride was presidentially appointed U.S. Attorney for the Eastern District of Virginia on Sept. 18, 2009. McBride previously served as Associate Deputy Attorney General, Department of Justice (2009); General Counsel and Vice President, Anti-Piracy for Business Software Alliance (2005-2009); Chief Counsel and Staff Director for Senator Joseph R. Biden, Jr., U.S. Senate, Committee on the Judiciary (2001-2005); Assistant U.S. Attorney for the District of Columbia (1997-2001); and associate with Verner, Liipfert, Bernhard, McPherson & Hand, Chartered (1993-1997).
Peter F. Neronha was presidentially appointed U.S. Attorney for the District of Rhode Island on September 16, 2009. He previously served as Assistant U.S. Attorney for the District of Rhode Island (2002-2009); Assistant Attorney General (2001-2002) and Special Assistant Attorney General (1996-2001) for the Department of the Attorney General, state of Rhode Island; and Associate with Goodwin Proctor LLP (1989-1995).
Joyce White Vance was presidentially appointed U.S. Attorney for the Northern District of Alabama on Aug. 27, 2009, and was Attorney General appointed in June 2009-August 2009. Vance served as Assistant U.S. Attorney and Appellate Division Chief for the Northern District of Ala. (1991-2009); associate with Bradley, Arant, Rose & White, Birmingham, Ala. (1988-1991); summer associate with McDermott, Will & Emery, Washington, DC (1988); and associate with Arant, ox Kitner, Plotkin & Kahn, Washington, DC (1984-1988).
Channing D. Phillips was appointed Acting U.S. Attorney for the District of Columbia on May 30, 2009. Phillips previously served in the U.S. Attorney’s Office for the District of Columbia as Principal Assistant U.S. Attorney (2004-2009), Chief of Staff (2001-2004), Special Counsel (1997-2001) and Assistant U.S. Attorney (1994-1997). Phillips was a trial attorney with the Organized Crime and Racketeering Section, Department of Justice (1990-1994).
23 October 2009
Little Rock Man Pleads Guilty to FederalSex Trafficking and Related ChargesRead the Press Release
WASHINGTON – Tommy Handy, aka "Tom Tom," waived indictment and pleaded guilty in federal court in Little Rock, Ark., to a federal charge of sex trafficking of an underage female, announced Thomas E. Perez, Assistant Attorney General for the Civil Rights Division, Jane W. Duke, U.S. Attorney for the Eastern District of Arkansas, and Thomas J. Browne, Special Agent in Charge of the Little Rock Field Office of the FBI.
Handy, 45, admitted during the hearing that he knew an underage female with the initials of "DB" was between the ages of 14 and 18 when she was caused to engage in commercial sex acts and that Handy benefitted from her engaging in the commercial sex acts. According to the plea agreement, the pending indictment was dismissed upon the court’s acceptance of Handy’s plea to the sex trafficking charge. As a result of his plea, Handy could be sentenced to a minimum of 10 years and up to life in prison. A sentencing hearing will be scheduled by the court. Handy remains in custody pending his sentencing.
Handy’s co-defendant, Everett Cooney, who is also in custody, also pleaded guilty to this charge on July 10, 2009, and is awaiting sentencing.
The case is the result of a joint investigation conducted by the FBI; the Bureau of Alcohol, Tobacco, Firearms and Explosives; and the Little Rock Police Department. The case is being prosecuted by Assistant U.S. Attorney John Ray White and Trial Attorney Jim Felte of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Justice Department Moves to Intervene in Adult Homes Case Against the State of New York to Help Shape RemedyRead the Press Release
WASHINGTON – The Justice Department today filed a motion to intervene in Disability Advocates Inc. v. David A. Paterson, et al. in federal court in the Eastern District of New York. The United States alleges that the state of New York has failed to house thousands of individuals with mental illness who currently reside in large, institutional "adult homes" in the most integrated setting, in violation of Title II of the Americans with Disabilities Act (ADA) and Section 504 of the Rehabilitation Act. An integrated setting is a setting that enables individuals with disabilities to interact with nondisabled persons to the fullest extent possible.
On Sep. 8, 2009, the district court ruled that the state discriminated against individuals with mental illness residing in adult homes, in violation of the integration mandate of the ADA and the Rehabilitation Act. The case has entered a stage where the court will determine a remedy for the violations. The United States now seeks to participate in crafting that remedy.
"As the Supreme Court determined in the landmark Olmstead v. L.C. case, unjustified institutionalization stigmatizes individuals with disabilities as unworthy of participation in community life," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "New York successfully provides community-based housing, such as scattered site apartments with supportive services, for individuals just like those currently residing in adult homes, and should provide the same opportunity for adult home residents."
"By moving to intervene in this case, we seek to support the development of an appropriate court-ordered remedy to ensure that the civil rights of individuals with mental illness in the city and state of New York are appropriately protected," said Benton J. Campbell, U.S. Attorney for the Eastern District of New York.
The full and fair enforcement of the ADA and its mandate to integrate individuals with disabilities is a major priority of the Civil Rights Division. The ADA protects individuals with disabilities from discrimination by public entities. People interested in finding out more about the ADA can call the Justice Department’s toll-free ADA Information Line at 1-800-514-0301 or 1-800-514-0383 (TTY), or access its ADA Web site at http://www.ada.gov.
Former U.S. Army Contracting Official Sentenced to 40 Months in Prison for Accepting BribesRead the Press Release
WASHINGTON - A former U.S. Army contracting official was sentenced today to 40 months in prison for accepting more than $80,000 in bribes in exchange for corruptly providing contract work to two Afghan trucking companies, announced Assistant Attorney General of the Criminal Division Lanny A. Breuer and U.S. Attorney Neil H. MacBride of the Eastern District of Virginia.
James Paul Clifton, 35, of Newport News, Va., was also ordered by U.S. District Court Judge Liam O’Grady to serve three years of supervised release following the prison term. Clifton pleaded guilty to one count of bribery on Aug. 7, 2009, in U.S. District Court for the Eastern District of Virginia.
The U.S. Army operates the Bagram Airfield in support of military operations in Afghanistan. According to court documents, the Army assigns a contracting officer representative (COR) to review all transportation requests and transportation providers. The Army assigned Clifton, a staff sergeant, to be the COR at the Bagram Airfield in February 2008. Clifton’s duties included overseeing the companies providing ground transportation to and from Bagram Airfield and objectively determining whether the companies’ service had been adequate.
According to the plea agreement, employees for AIT, a trucking company operating at Bagram Airfield, began to offer Clifton gifts almost immediately after he was assigned to his position. Despite initially refusing the gifts, Clifton admitted he accepted a cellular telephone in May 2008, paid for by AIT. According to court documents, AIT then began to make payments to Clifton at a rate of $20,000 a month. Clifton admitted that in exchange for the payments, he agreed to assign one extra day of trucking service to the company. Clifton also admitted that later in the month, another Afghan trucking company, ATT, entered into a similar illegal agreement with him. Clifton further admitted that in exchange for bribe payments of $15,000 a month, he assigned ATT an additional day of trucking service a month. Between May and October 2008, Clifton admitted, ATT and AIT made $87,000 in payments to him. According to court documents, affiliates of both companies wired the payments from Dubai, United Arab Emirates, to Clifton’s then-girlfriend in Newport News, Va. According to the terms of their agreement, the companies had agreed to pay Clifton an additional $10,000, although he never received the payments.
The case is being prosecuted by Special Assistant U.S. Attorney Steve A. Linick, Deputy Chief of the Criminal Division’s Fraud Section, and Fraud Section Trial Attorney Liam Brennan. The investigation is being conducted by Defense Criminal Investigative Service, the FBI and members of the National Procurement Fraud Task Force.
The National Procurement Fraud Task Force, created in October 2006 by the Department of Justice, was designed to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in government contracting activity for national security and other government programs.
Former State Department Employee Sentenced<br /> for Illegally Accessing Confidential Passport FilesRead the Press Release
WASHINGTON – A former State Department employee was sentenced today to 12 months of probation for illegally accessing more than 75 confidential passport application files, Assistant Attorney General Lanny A. Breuer of the Criminal Division announced. William A. Celey, 28, of Washington, was also ordered to perform 50 hours of community service by U.S. Magistrate Judge Deborah A. Robinson in the District of Columbia. On July 10, 2009, Celey pleaded guilty to a one-count criminal information charging him with unauthorized computer access.
According to court documents, from August 2003 through July 2004, Celey worked as a contract employee for the State Department as a file assistant. According to plea documents, Celey admitted he had access to official State Department computer databases in the regular course of his employment, including the Passport Information Electronic Records System (PIERS), which contains all imaged passport applications dating back to 1994. The imaged passport applications on PIERS contain, among other things, a photograph of the passport applicant as well as certain personal information including the applicant's full name, date and place of birth, current address, telephone numbers, parent information, spouse’s name and emergency contact information. These confidential files are protected by the Privacy Act of 1974, and access by State Department employees is strictly limited to official government duties.
In pleading guilty, Celey admitted that between June 22, 2004, and July 15, 2004, he logged onto the PIERS database and viewed the passport applications of more than 75 celebrities and their families, actors, models, musicians, athletes, record producers, family members, a politician and other individuals identified in the press. Celey admitted that he had no official government reason to access and view these passport applications, but that his sole purpose in accessing and viewing these passport applications was idle curiosity.
Celey is the sixth current or former State Department employee to plead guilty in this continuing investigation. On Sept. 22, 2008, Lawrence C. Yontz, a former Foreign Service Officer and intelligence analyst, pleaded guilty to unlawfully accessing nearly 200 confidential passport files. Yontz was sentenced on Dec. 19, 2008, to 12 months of probation and ordered to perform 50 hours of community service. On Jan. 14, 2009, Dwayne F. Cross, a former administrative assistant and contract specialist, pleaded guilty to unlawfully accessing more than 150 confidential passport files. On March 23, 2009, Cross was sentenced to 12 months of probation and ordered to perform 100 hours of community service. On Jan. 27, 2009, Gerald R. Lueders, a former Foreign Service Officer, watch officer and recruitment coordinator, pleaded guilty to unlawfully accessing more than 50 confidential passport files. Lueders was sentenced on July 8, 2009, to 12 months of probation and ordered to pay a $5,000 fine. On Aug. 17, 2009, Kevin M. Young, a contact representative, pleaded guilty to unlawfully accessing more than 125 confidential passport files. Young is scheduled to be sentenced on Dec. 9, 2009. On Aug. 26, 2009, Karak Busch, a former citizens services specialist, pleaded guilty to unlawfully accessing more than 65 confidential passport files. Busch is scheduled to be sentenced on Dec. 15, 2009.
These cases are being prosecuted by Trial Attorney Armando O. Bonilla of the Criminal Division’s Public Integrity Section, headed by Section Chief William M. Welch II. The cases are being investigated by the State Department Office of Inspector General.
22 October 2009
Virginian Accountant, Attorney and Investment Firm Officer Charged with Conspiracy in Tax Shelter CaseRead the Press Release
WASHINGTON -- Daryl Haynor, an accountant who was a tax partner at an accounting firm in Tysons Corner, Va., and Jon Flask, an attorney who was a partner at a law firm in Vienna, Va., were indicted today for conspiracy to defraud the Internal Revenue Service (IRS) and for corruptly endeavoring to obstruct and impede the due administration of the internal revenue laws, the Justice Department and IRS announced.
Michael Parker, who was the chief operating officer of TransCapital Corporation, a tax-advantaged investments company based in Northen Virginia, was also charged today in a criminal information with conspiracy to defraud the IRS. According to a plea agreement that was also filed today, Parker has agreed to plead guilty to this conspiracy count.
According to the indictment, from 1998 through 2006, Haynor, Flask and Parker marketed and implemented a tax shelter called the "Sale Leaseback of Tenant Improvements Strategy" (SLOTS), which enabled various U.S. corporations to claim tax deductions totaling more than $240 million on corporate income tax returns filed with the IRS. During 2002 through 2004, the IRS audited three U.S. corporations that had claimed losses generated by SLOTS transactions.
The indictment alleges that Haynor, Flask and Parker conspired to impede and impair the IRS by making false and misleading statements to IRS agents and attorneys during these audits. The indictment further alleges that tax opinion letters were issued in connection with SLOTS transactions that omitted material facts and contained false and misleading information.
Additionally, the indictment alleges that Haynor, Flask and Parker concealed certain aspects of the tax shelter transaction from SLOTS clients for the purpose of impeding and impairing the IRS.
According to his plea agreement, Parker admitted that he and others took affirmative steps to conceal, mislead and deceive the IRS by misrepresenting facts concerning SLOTS. Parker further acknowledged that the SLOTS tax shelter and related transactions were themselves nothing more than devices to disguise and conceal mere financing transactions.
If convicted, Haynor and Flask face a maximum sentence of eight years in prison and a $500,000 fine. Parker faces a maximum sentence of five years in prison and a $250,000 fine.
An indictment is merely a formal charge by the grand jury. Defendants are presumed innocent unless and until proven guilty in U.S. district court.
The case is being prosecuted by Justice Department Tax Division Trial Attorneys John E. Sullivan and Joseph A. Rillotta. The case was investigation by IRS-Criminal Investigation.
Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at http://www.usdoj.gov/tax.
Virginia Man Sentenced to 41 Months in Prison for Selling <br /> Counterfeit Software Through the InternetRead the Press Release
WASHINGTON – Gregory William Fair, 46, of Falls Church, Va., was sentenced today to 41 months in prison for selling counterfeit computer software on the Internet, in violation of criminal copyright infringement laws, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division and Acting U.S. Attorney for the District of Columbia Channing D. Phillips.
Fair was also sentenced by Judge R. W. Roberts in the U.S. District Court for the District of Columbia to three years of supervised release and was ordered to pay $743,098 in restitution. Fair forfeited $144,000 in currency seized from a safety deposit box and residence, one BMW 525i, one Hummer H2, one Mercedes CL600 and one 1969 Pontiac GTO, all of which were purchased with the illegal proceeds of the scheme.
Fair pleaded guilty on April 16, 2009, to one count of criminal copyright infringement and one count of mail fraud for selling pirated business software on the eBay Web site. According to court documents, the software sold by Fair had a combined retail value of more than $1 million. In his plea, Fair admitted that from 2001 through 2007, he used a variety of eBay user identifications to sell a large volume of counterfeit software without authorization from the copyright owners.
The case is part of the Department of Justice’s ongoing initiative to combat the sale of pirated software and counterfeit goods through commercial Web sites and online auction sites. To date, the Department has obtained 39 convictions involving online auction and commercial distribution of counterfeit software. The Department’s initiative to combat online auction piracy is just one of several steps being undertaken to address the losses caused by intellectual property theft and hold responsible those engaged in criminal copyright infringement.
The case is being prosecuted by Trial Attorney Marc Miller of the Criminal Division’s Computer Crime and Intellectual Property Section as well as Assistant U.S. Attorneys Thomas Hibarger and Glenn S. Leon of the District of Columbia. The case was investigated by the U.S. Postal Inspection Service in Washington, D.C.
Three Sentenced for Conspiring to Commit Terrorist Acts Against Americans OverseasRead the Press Release
WASHINGTON -- Three Ohio residents, Mohammad Zaki Amawi, 29, Marwan Othman El-Hindi, 46, and Wassim I. Mazloum, 28, have been sentenced to prison terms ranging from more than 8 years to 20 years for conspiring to commit terrorist acts against Americans overseas, including U.S. military personnel in Iraq, and other terrorism-related violations.
The sentences, which were handed down yesterday by U.S. District Court Chief Judge James G. Carr in the Northern District of Ohio, were announced by David Kris, Assistant Attorney General for National Security; Stephen M. Dettelbach, U.S. Attorney for the Northern District of Ohio; and C. Frank Figliuzzi, Special Agent in Charge, Cleveland Division of the Federal Bureau of Investigation (FBI).
Judge Carr sentenced Amawi to a term of 20 years incarceration followed by life on supervised release. El-Hindi was sentenced to a term of 13 years incarceration, including 12 years for the terror violations and 18 months for a separate fraud conviction. Mazloum received a sentence of 100 months or 8.3 years incarceration followed by life on supervised release.
In February 2007, Amawi, El-Hindi, and Mazloum were charged in a superseding indictment with conspiring to kill or maim persons outside the United States, including U.S. military personnel serving in Iraq, and conspiring to provide material support to terrorists. Amawi and El-Hindi were also charged individually with distributing information regarding the manufacture or use of explosives, including suicide bomb vests and Improvised Explosive Devices (IEDs).
On June 13, 2008, a jury convicted the defendants on all counts. Amawi, a citizen of Jordan and the United States, and El Hindi, a naturalized U.S. citizen born in Jordan, were each convicted of one count of conspiring to kill or maim persons outside the United States, one count of conspiring to provide material support to terrorists, and two counts of distributing information on explosives. Mazloum, a U.S. legal permanent resident from Lebanon, was convicted of one count of conspiring to kill or maim persons outside the United States and one count of conspiring to provide material support to terrorists. The convictions represented the nation’s first successful trial of a "homegrown terror cell" for terrorism related crimes.
At trial, the government proved that all three defendants engaged in a conspiracy, beginning sometime prior to June 2004, to kill or maim persons outside the United States, including U.S. armed forces personnel in Iraq. As part of the conspiracy, the defendants conducted firearms training and accessed and copied instructions in the construction and use of explosives – including IEDs and suicide bomb vests. In addition, the defendants conspired to recruit others to participate in jihad training; researched and solicited funding sources for such training; and proposed sites for training in firearms, explosives and hand-to-hand combat to prospective recruits.
The government also proved that all defendants conspired to provide material support and resources, including personnel, money, explosives and laptop computers, to terrorists, including a co-conspirator in the Middle East, who had requested such materials for use against U.S. and coalition forces in Iraq. For example, among other activities, Amawi communicated with a contact in the Middle East on chemical explosives and traveled to Jordan in August 2005 with laptop computers intended for delivery to mujahideen "brothers."
The government also proved that Amawi knowingly distributed a guide describing the step-by-step process for manufacturing chemical explosive compounds, as well as a video entitled, "Martyrdom Operation Vest Preparation," which described the step-by-step construction and use of a suicide bomb vest. Amawi distributed these materials with the intent that they be used for training others to commit a crime of violence, including the killing of U.S. nationals overseas.
The government further proved that El-Hindi knowingly distributed a slide show demonstrating the preparation and use of IEDs against apparent U.S. military vehicles and personnel, as well as the video entitled "Martyrdom Operation Vest Preparation." El-Hindi distributed these materials with the intent that they be used for training others to commit a crime of violence, including the killing of U.S. nationals overseas.
Assistant Attorney General Kris, U.S. Attorney Dettelbach and Special Agent in Charge Figliuzzi thanked the many different agencies that worked on this case. The investigation was conducted by the FBI and the Joint Terrorism Task Force in Toledo, Ohio, with support from the FBI in Chicago, and with the assistance of the Internal Revenue Service, Criminal Investigation Division; the U.S. Secret Service; U.S. Immigration and Customs Enforcement; the Drug Enforcement Administration; the Ohio Highway Patrol; the Toledo Police Department; and the Lucas and Wood County Sheriff’s Departments.
This case was prosecuted by Assistant U.S. Attorneys Thomas E. Getz and Justin E. Herdman of the National Security Unit of the U.S Attorney’s Office in Cleveland, as well Assistant U.S. Attorneys Gregg N. Sofer of the U.S. Attorney’s Office in Austin, Texas, and Assistant U.S. Attorney David I. Miller of the U.S. Attorney’s Office in New York, (both formerly of the Justice Department’s Counterterrorism Section) and Trial Attorney Jerome J. Teresinski of the Justice Department’s Counterterrorism Section. The U.S. Attorney’s office in Detroit also provided assistance in this case.
New York Man Indicted for Clean Air Act ViolationsRead the Press Release
WASHINGTON--A federal grand jury in the Western District of New York, has returned a superseding indictment charging David Vega and Francis Rowe with committing violations of the Clean Air Act while they were project managers for Gordon-Smith Contracting, Inc., an asbestos removal company owned by Keith Gordon-Smith, the Justice Department announced.
The indictment supersedes an earlier indictment returned by the grand jury in June 2009, against Keith Gordon-Smith, charging him with numerous violations of the Clean Air Act, submitting false statements and obstruction of justice. The superseding indictment now also charges Gordon-Smith’s company with the same criminal violations. In addition, the superseding indictment charges Francis Rowe with submitting a false statement in an effort to obtain a court-appointed attorney.
The charges stem from allegations that Gordon-Smith, Gordon-Smith Contracting, Vega and Rowe directed and caused workers to illegally remove and dispose of asbestos during the demolition of the Genesee Hospital complex in Rochester, N.Y.
The Clean Air Act requires contractors who remove asbestos from public buildings to follow federally-established work practice standards to ensure the safe removal of the asbestos. The required standards include providing notice to the U.S. Environmental Protection Agency (EPA) before commencing asbestos removal, adequately wetting the asbestos during the removal and before disposal, and properly disposing of the asbestos at an EPA-approved disposal site.
The 18-count indictment alleges that at different time periods between June 2007 and April 2009, Gordon-Smith, Vega and Rowe had Gordon-Smith Contracting employees remove asbestos from the Genesee Hospital complex without ensuring that the asbestos was kept adequately wet or properly disposed. The indictment also alleges that Gordon-Smith caused his company’s employees to perform illegal asbestos removal at other sites, including schools, and that Gordon-Smith took several steps to hide the illegal asbestos removal from federal agencies. These included failing to provide prior notification to EPA before the asbestos removal projects were performed at the schools and hospital, giving false statements to an inspector from the Occupational Safety and Health Administration, and providing a false notification to the EPA.
If convicted, Gordon-Smith, Vega and Rowe could each be punished by up to five years in prison as well as a criminal fine of up to $250,000 for each count. Gordon-Smith Contracting could be subject to a criminal fine of the greater of $500,000 or twice the gain obtained by the company or suffered by any victims as a result of the crimes, for each count.
The U.S. Attorney’s Office for the Western District of New York has established a page on its Web site at http://www.usdoj.gov/usao/nyw to provide information for potential victims who may have been harmed as a result of the alleged crimes.
The case is being prosecuted by the U.S. Attorney’s Office for the Western District of New York and the Justice Department’s Environmental Crimes Section. The case was investigated by the EPA Criminal Investigation Division and the U.S. Department of Labor Office of the Inspector General.
More Than 300 Alleged La Familia Cartel Members and Associates Arrested in Two-Day Nationwide TakedownRead the Press Release
WASHINGTON – Today Attorney General Eric Holder announced the arrest of nearly 1,200 individuals on narcotics-related charges and the seizure of more than 11.7 tons of narcotics as part of a 44-month multi-agency law enforcement investigation known as "Project Coronado." The Attorney General was joined in announcing the current results of Project Coronado by DEA Acting Administrator Michele M. Leonhart, FBI Director Robert S. Mueller III and ATF Acting Director Kenneth E. Melson.
Over the past two days, 303 individuals in 19 states were arrested as part of Project Coronado, which targeted the distribution network of a major Mexican drug trafficking organization known as La Familia, through coordination between federal, state and local law enforcement. More than 3,000 agents and officers operated across the United States to make the arrests during the two-day takedown. During the two-day operation alone, $3.4 million in U.S. currency, 729 pounds of methamphetamine, 62 kilograms of cocaine, 967 pounds of marijuana, 144 weapons and 109 vehicles were seized by law enforcement agents.
"This unprecedented, coordinated U.S. law enforcement action - the largest ever undertaken against a Mexican drug cartel - has dealt a significant blow to La Familia’s supply chain of illegal drugs, weapons and cash flowing between Mexico and the United States," said Attorney General Holder. "We will not allow these cartels to operate unfettered in our country, and with the increases in cooperation between U.S. and Mexican authorities in recent years, we are taking the fight to our adversaries. We will continue to stand strong with our partners in Mexico as we work to disrupt and dismantle cartel operations on both sides of the border."
The La Familia cartel is a violent drug trafficking cartel based in the state of Michoacán, in southwestern Mexico. According to court documents, La Familia controls drug manufacturing and distribution in and around Michoacán, including the importation of vast quantities of cocaine and methamphetamine from Mexico into the United States. La Familia is philosophically opposed to the sale of methamphetamine to Mexicans, and instead supports its export to the United States for consumption by Americans. La Familia is a heavily armed cartel that has utilized violence to support its narcotics trafficking business including murders, kidnappings and assaults. According to one indictment unsealed in the Southern District of New York, associates of La Familia based in the United States have allegedly acquired military-grade weapons, including assault weapons and ammunition, and have arranged for them to be smuggled back into Mexico for use by La Familia. In a criminal complaint filed in Dallas, ATF investigators allege that operatives of La Familia shipped hundreds of firearms from the U.S. to Mexico over a 12-month period ending in October 2009. Individuals indicted in the cases are charged with a variety of crimes, including: conspiracy to distribute methamphetamine, cocaine and marijuana; distribution of methamphetamine, cocaine and marijuana; conspiracy to import narcotics into the United States; money laundering; and other violations of federal law. Numerous defendants face forfeiture allegations as well.
To date, Project Coronado has led to the arrest of 1,186 individuals and the seizure of approximately $32.8 million in U.S. currency, and approximately 2,710 pounds of methamphetamine, 1,999 kilograms of cocaine, 29 pounds of heroin, 16,390 pounds of marijuana, 389 weapons and 269 vehicles.
"Project Coronado, our massive assault on the La Familia Cartel, is part of our continued fight against all of the powerful Mexico-based drug cartels," said DEA Acting Administrator Michele M. Leonhart. "This organization, the newest of Mexican cartels, is directly responsible for a vast majority of the methamphetamine pouring into our country across our Southwest Border, and has had a hand in fueling the cycle of violence that is wracking Mexico today. DEA, along with our U.S. and Mexican partners, are committed to strategically attacking the international and domestic drug trade with every tool at our disposal, and defeating those that thrive on the suffering of others."
"Multi-agency coordinated investigations such as Project Coronado are the key to disrupting the operations of complex criminal organizations like La Familia. Together – with the strong collaboration of our international, federal, state and local partners – we have dealt a substantial blow to a group that has polluted our neighborhoods with illicit drugs and has terrorized Mexico with unimaginable violence," said Director Mueller.
"ATF’s arrest of defendants in Project Coronado highlight the almost inseparable link between illegal trafficking of firearms and narcotics between the U.S. and Mexico," said ATF Acting Director Kenneth Melson. "ATF is on the frontline against violent crime and focuses its investigative tools on criminal groups such as La Familia, which use firearms to further their illegal trade and ruin and endanger countless lives. It is alleged that La Familia used proceeds from the sale of drugs to purchase or obtain hundreds of firearms that were then moved illicitly to Mexico."
"The operation to dismantle the La Familia drug trafficking organization in the United States demonstrates an unprecedented level of partnership and coordination at the local, state and federal levels. We at ICE are proud to have played an important role in yesterday’s operation and look forward to continuing to work with our law enforcement partners to target these criminal organizations," said Immigration and Customs Enforcement (ICE) Assistant Secretary John Morton.
Arrests were made or charges have been unsealed yesterday and today related to Project Coronado in the following districts: Central District of California, Southern District of California, District of Colorado, Northern District of Georgia, District of Massachusetts, District of Minnesota, Southern District of Mississippi, Eastern District of Missouri, Northern District of Oklahoma, Southern District of New York, Northern District of New York, Middle District of North Carolina, District of South Carolina, Middle District of Tennessee, Eastern District of Texas, Northern District of Texas, Western District of Texas and the Western District of Washington. There were also arrests by state authorities in California, Nevada, North Carolina and Georgia. Assistance for Project Coronado was provided by the Criminal Division’s Narcotic and Dangerous Drug Section and Office of International Affairs. Additionally, local prosecutions will occur in San Diego, San Bernardino, Los Angeles and Orange County, Calif.; Clark County, Nev.; Gwinnett County, Ga.; and Pitt County, N.C.
The investigative efforts in Project Coronado were coordinated by the multi-agency Special Operations Division, comprised of agents and analysts from the DEA, FBI, ICE, Internal Revenue Service, U.S. Customs and Border Protection, U.S. Marshals Service and ATF, as well as attorneys from the Criminal Division’s Narcotic and Dangerous Drug Section. More than 300 federal, state, local and foreign law enforcement agencies contributed investigative and prosecutorial resources to Project Coronado through the Organized Crime Drug Enforcement Task Forces.
An indictment is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Justice Department Reaches ADA Settlement with Beth Israel Deaconess Medical CenterRead the Press Release
WASHINGTON – The Justice Department today announced a comprehensive settlement agreement under the Americans with Disabilities Act (ADA) with the Beth Israel Deaconess Medical Center (BIDMC) in Brookline, Mass., to ensure access to medical facilities and services for individuals with disabilities. BIDMC, a teaching hospital affiliated with Harvard University, encompasses more than 30 buildings and three community health clinics, and operates as a quaternary acute care facility and level one trauma center providing sub-specialty services. The agreement requires, among other things, that BIDMC ensure that accessible patient rooms and accessible medical equipment – such as examination tables – are available for each of its clinical services.
"This agreement with a major teaching hospital that serves a diverse metropolitan community is a major step toward access to equal medical treatment for individuals with disabilities," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "It is a top priority of the Civil Rights Division to enforce laws that guarantee that persons with disabilities have equal access to medical care and critical services. We applaud the Beth Israel Deaconess Medical Center for working closely and cooperatively with us to reach a resolution."
The Agreement with BIDMC, which is the result of a compliance review conducted by the Department, requires BIDMC to:
- Take steps to ensure that a minimum of 10 percent of its existing patient rooms are accessible, including accessible toilet facilities, and are dispersed through its clinical services;
- Ensure that each department and clinical practice provides at least one accessible examination table that lowers to 17 to 19" from the floor, thus enabling those with mobility disabilities to transfer to the exam table;
- Survey existing hospital and patient care facilities and equipment, including patient beds, exam tables, lifts, and radiologic and diagnostic equipment, for compliance with ADA standards; and implement a system to ensure that BIDMC purchases accessible equipment where they are commercially available;
- Develop and implement a barrier removal plan;
- Review hospital policies and train staff to address the needs of individuals with disabilities; and
- Appoint an ADA officer to oversee implementation of the agreement.
The ADA prohibits discrimination by public accommodations on the basis of disability, including the denial by medical facilities of equal medical services to individuals with disabilities. Those interested in finding out more about these agreements or seeking information about and how to comply with the ADA can call the Justice Department's toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TDD), or access its ADA Web site at http://www.ada.gov.
Bronx Return Preparer Pleads Guilty to Filing False Tax ReturnsRead the Press Release
WASHINGTON - Rosa N. Rivera, a resident of the Bronx, N.Y., pleaded guilty today to aiding and assisting in the presentation of a false individual income tax return for clients and to filing a false individual income tax return, the Justice Department and Internal Revenue Service (IRS) announced. Magistrate Judge Gabriel Gorenstein released Rivera on bail pending sentencing.
According to the charging information filed in Manhattan, Rivera owned and operated RNR Tax Service located in the Bronx, a firm that provided tax return preparation services to clients. Between 2003 and 2006, Rivera aided and assisted clients in the preparation of false income tax returns that were filed with the IRS. Specifically, Rivera falsified income tax returns for clients by claiming and itemizing Schedule A deductions and expenses, such as charitable contributions, medical and dental expenses and job-related expenses, that were either fictitious or grossly-inflated.
Rivera also falsified Schedule E rental property expenses and losses. Rivera’s alleged scheme to falsify deductions and expenses on her clients’ returns resulted in the reduction of taxable income reported by her clients to the IRS and, thus, fraudulently reduced the payment of income taxes lawfully owed to the U.S. Treasury.
By fraudulently reducing the reported tax liability of her clients, the information charges that Rivera was able to generate more business from prospective clients seeking assistance in the preparation of federal income tax returns.
In addition to admitting to aiding in the filing of a false tax return for clients, Rivera also pleaded guilty to falsifying her own tax return for the 2005 tax return by failing to report all her income earned from her tax return preparation business.
Sentencing is scheduled for Jan. 22, 2010. On each count to which she has pleaded guilty, Rivera faces a maximum sentence of three years in prison, one year of supervised release, substantial fines, a special assessment of $100 and the costs of prosecution.
Acting Assistant Attorney General John A. DiCicco of the Justice Department’s Tax Division thanked the IRS-Criminal Investigation New York Field Office which investigated the case, as well as Tax Division trial attorney John N. Kane, Jr. who prosecuted the case. Acting Assistant Attorney General DiCicco also thanked the U.S. Attorney’s Office for the Southern District of New York for their assistance in the prosecution.
Alabama Resident Sentenced to Prison for Filing False Tax Returns in Connection with Embezzlement SchemeRead the Press Release
WASHINGTON - Sims Lawson Jr., a resident of Killen, Ala., was sentenced to 70 months in prison by Judge R. David Proctor, the Justice Department and Internal Revenue Service (IRS) announced today.
In June 2009, Lawson pleaded guilty to filing false tax returns for years 2002 through 2004. According to the plea agreement and statements made during the sentencing hearing, Lawson willfully omitted from his tax returns income that he had embezzled from an estate that he managed. Lawson was hired in 2002 to co-manage an estate, and his duties included managing the books and records of the estate, collecting on loans made by the estate, and determining the estate’s value for tax purposes. In 2005, the estate received an ex parte court order removing Lawson from his responsibilities as trustee. It was later determined that Lawson had misappropriated at least $721,417 in 2002, 2003 and 2004, which he also failed to report on his personal tax returns. The estate also paid Lawson an additional $297,352, which he failed to report on his individual tax return.
According to the plea agreement and statements made during the sentencing hearing, throughout the time period he was employed with the estate, Lawson misappropriated money from the estate in several ways. First, Lawson wrote checks from the estate payable to himself and used estate checks to pay his personal expenses.
Additionally, Lawson fraudulently used estate checks to pay for the installation of a swimming pool at his personal residence, renovations on his personal residence, and extravagant trips to locales including New York City, Las Vegas, the Sundance Film Festival, the Bahamas and Disney World. Lawson also purchased timeshares at the Atlantis resort in the Bahamas, as well as timeshares at the Disney World resort in Orlando, Fla., with embezzled funds. Finally, Lawson also used funds from the estate to purchase jewelry and tickets to various events.
Acting Assistant Attorney General John A. DiCicco of the Justice Department’s Tax Division thanked Tax Division attorneys Jed Silversmith and Matthew Mueller, and Assistant U.S. Attorney Melissa Atwood, who prosecuted the case. He also thanked the IRS Criminal Investigation agents in the Birmingham office who investigated the case.
More information about the Justice Department’s Tax Division and its enforcement efforts is available at http://www.usdoj.gov/tax.
21 October 2009
Ship Operator Pleads Guilty for Concealing Pollution from Oil TankerRead the Press Release
A Panamanian company that operated a 40,000-ton oil tanker ship that regularly made calls in multiple ports in Texas pleaded guilty today in federal court in Houston for deliberately concealing pollution discharges from the ship directly into the sea.
Styga Compania Naviera S.A., the operator of the M/T Georgios M, pleaded guilty to three felony violations of the Act to Prevent Pollution from Ships for failing to properly maintain an oil record book as required by federal and international law.
According to a plea agreement filed with U.S. District Court for the Southern District of Texas, the company has agreed to pay a $1 million criminal fine along with a $250,000 community service payment to the congressionally-established National Marine Sanctuary Foundation. The money will be designated for use in the Flower Garden and Stetson Banks National Marine Sanctuary, headquartered in Galveston, Texas, to support the protection and preservation of natural and cultural resources located in and adjacent to the sanctuary.
"Stopping the illegal pollution from ships continues to be a priority for the Department," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "As long as companies continue to bypass this nation’s environmental laws, the department will continue to bring cases and seek justice for those involved."
"This case clearly demonstrates the Coast Guard’s commitment to work with our interagency partners to aggressively enforce all maritime anti-pollution and safety of life at sea laws. The breadth and magnitude of the investigation that underpinned the charges brought forth is a testament to the dedication of all persons who were involved in resolving this matter including the Coast Guard Investigative Service, the Environmental Protection Agency, and the U.S. Department of Justice," said Rear Admiral Mary Landry, Eighth District Coast Guard commander.
"The seas must be protected and commercial vessels must operate safely and lawfully," said Paula D. Brown, Acting Special Agent in Charge for Environmental Protection Agency’s Criminal Investigation Division in Houston. "Those who use the oceans or our waters as dumping grounds for waste oil and sludge will be vigorously prosecuted."
According to the joint factual statement, from December 2006 until February 2009, senior engineering officers and crewmembers acting on behalf of Styga installed a bypass pipe known as a "magic pipe" in order to avoid the pollution control equipment on-board the ship. The senior engineers then directed junior engineers to connect the so-called "magic pipe" and deliberately discharge sludge and oily waste directly into the ocean.
Federal and international law requires that all ships comply with pollution regulations that include the proper disposal of oily water and sludge by passing the oily water through a separator aboard the vessel or burning the sludge in the ship’s incinerator. Federal law also requires ships to accurately record each disposal of oily water or sludge in an oil record book, and to have the record book available for the U.S. Coast Guard when the vessel is within the waters of the United States. The Georgios M often called on ports in Corpus Christi, Texas City, Freeport, and Houston, Texas while engaging in the international oil trade.
According to court documents, the engineers knowingly failed to make the required entries into the oil record book including the fact that sludge and oily waste had been discharged directly into the ocean using the "magic pipe" and circumventing the internationally required pollution control equipment. The senior engineers also made false entries in the oil record book to conceal the fact that the pollution control equipment had not been used. The crewmembers then attempted to conceal the discharges on Feb. 19, 2009, during a Coast Guard boarding at the port in Texas City, by providing the falsified oil record book to the boarding crew.
The investigation was conducted by the Coast Guard Marine Safety Unit Texas City, Texas; Coast Guard Investigative Service in Houston, and the Environmental Protection Agency Criminal Investigation Division in Houston. The case is being prosecuted by the Justice Department’s Environmental Crimes Section.
Medicare Fraud Strike Force Operations in Houston Lead to Charges Against Six Area ResidentsRead the Press Release
Medicare fraud charges have been filed against six individuals in the continuing operation of the Medicare Fraud Strike Force in Houston.
In an indictment unsealed today, Bassey Monday Idiong, 30, owner of B.I. Medical Supply LLC, Linda Eteimo Ere Kendabie, 27, an administrative assistant at B.I. Medical, and Modupe Babanumi, 42, a patient recruiter for B.I. Medical, all of whom reside in the Houston area, were each charged with participating in a scheme to submit claims to Medicare for medically unnecessary durable medical equipment (DME) . In many instances the DME was not given to the purported patients. This equipment included so-called "arthritis kits," which consist of sets of orthotic braces that are purportedly used for the treatment of arthritis-related conditions.
The indictment alleges that the defendants caused to be submitted to Medicare more than $840,000 in false and fraudulent claims for the kits at a billing cost of approximately $4,000 per kit. The indictment alleges that in one instance, B.I. Medical billed a kit to Medicare that included two knee braces for a Medicare beneficiary who had only one leg.
Charges were also unsealed yesterday against Ana Quinteros, 28, and Michelle Turner, 42, both of Houston, who were each charged in a superseding indictment with one count of conspiring to defraud Medicare for their participation in a scheme to submit false and fraudulent claims, also for arthritis kits. Four individuals charged in the original indictment of July 2009, Clifford Ubani, Princewill Njoku, Mary Ellis and Rolondae Mitchell-Straughter, were also charged with various healthcare frauds in the superseding indictment. The scheme resulted in approximately $1.1 million in billings to the Medicare program.
And, Charles L. Roberts, 57, of Houston, was arrested on Oct. 2, 2009, on a complaint in connection with his role as a recruiter for KO Medical, a DME company owned and operated by Kate and Oliver Nkuku. Charges against Kate and Oliver Nkuku were announced previously. The complaint charges Roberts, aka "Chucky Roberts," with conspiracy to commit health care fraud and alleges that he provided Medicare beneficiary information to KO Medical so false and fraudulent claims for power wheelchairs and other DME could be submitted to Medicare.
The complaint also alleges that KO Medical billed Medicare for power wheelchairs under special codes indicating that a new piece of DME was being provided as a replacement for a similar piece of DME that was lost, damaged or destroyed during a natural disaster, such as a hurricane. Use of this modifier when a bill is submitted to Medicare allows DME to be billed without a physician’s prescription, because it is merely intended to replace a destroyed item that Medicare presumes was initially obtained with a proper prescription. The complaint alleges that in fact none of the beneficiaries involved actually had a power wheelchair that was lost or damaged. The complaint alleges that Oliver Nkuku paid Roberts a kickback of $400 each time Medicare paid for a power wheelchair for a beneficiary referred by Roberts.
The cases are being prosecuted by attorneys from the Criminal Division’s Fraud Section, including Assistant Chief John S. (Jay) Darden, Trial Attorneys Charles Reed and Katherine Houston, and Special Trial Attorney Anthony Burba.
An indictment or a complaint is merely an allegation, and defendants are presumed innocent until and unless proven guilty.
The Strike Force in Houston is the fourth phase of a targeted criminal, civil and administrative effort against individuals and health care companies that fraudulently bill the Medicare program.
Since inception in March 2007, Strike Force operations in four districts have resulted in indictments of 331 individuals who collectively have falsely billed the Medicare program for more than $720 million. In addition, HHS’ Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
Ubani Superseding Indictment
Idiong Kendabie and Babanumi Indictment
Los Angeles Medicare Fraud Strike Force Charges 20 in Health Care Fraud Cases Involving Durable Medical EquipmentRead the Press Release
Twenty defendants, most of them residing in the Los Angeles area, have been charged in seven cases for allegedly participating in Medicare fraud schemes that resulted in more than $26 million in fraudulent bills to the Medicare program.
Federal and state agents arrested seven of the defendants this morning, and seven others were taken into custody last week, as the result of an investigation by the Medicare Fraud Strike Force that targeted fraudulent durable medical equipment (DME) providers. The seven defendants arrested today are scheduled to make their initial appearances in U.S. District Court in Los Angeles beginning this afternoon.
"Today’s indictments and arrests are important achievements in our ongoing fight against Medicare fraud, but there is more that we can, and will, do," said Assistant Attorney General of the Criminal Division Lanny A. Breuer. "Our Medicare Fraud Strike Force will continue to be vigilant in rooting out criminals who masquerade as health care providers in order to steal from American taxpayers. Every dollar stolen from the Medicare program is one dollar too many."
"The Strike Force has been an effective tool to address a long-standing problem in my district," said Acting U.S. Attorney George S. Cardona. "The nearly two dozen people charged in recent weeks are linked to more than $26 million in fraudulent billings. That money is better spent paying for the medical needs of legitimate patients."
"Our Strike Forces are working. The continued cooperation among our agencies has once again resulted in more indictments and arrests of those suspected of defrauding the Medicare Trust Fund," said Daniel R. Levinson, HHS Inspector General. "Today’s operations demonstrate the effectiveness of using advanced technologies to detect fraud schemes and to support our joint enforcement efforts."
The seven cases announced today involve DME company owners and marketers who are accused of engaging in a variety of schemes that defrauded the Medicare program through fraudulent bills which total approximately $26 million. The charging documents outline criminal schemes involving the fraudulent ordering of power wheelchairs, orthotics (devices designed to assist with orthopedic problems) and hospital beds. In addition to the arrests, federal agents today executed search warrants at four locations in Los Angeles County.
Michael Martinez, 30, of Long Beach, Calif., and six other defendants were charged with conspiracy to commit health care fraud and for making false statements to the government. Martinez allegedly recruited relatives and individuals linked to the Santa Ana-based Brook Street Gang to act as straw owners for four fraudulent DME companies. The six other defendants – Angel Michel, 36, of San Diego; Guadalupe Alcaraz, 30, of Corona, Calif.; Theresa Padilla, 23, of Moreno Valley, Calif.; Pedro Franco, 28, of Torrance, Calif.; Ricardo Navarro, 49, of Corona; and Martin Padilla, 42, of Moreno Valley – allegedly each received approximately $5,000 from a Martinez associate to act as the nominal owners of the fraudulent DME companies. In this way, they could deceive Medicare by concealing the true identities of those who actually owned the companies. The indictment alleges that as part of the conspiracy, the fraudulent DME companies – Mercy Medical Supplies Inc.; Chatsworth Medical Equipment Inc.; All Your Needs Healthcare Products Inc.; and Global Meridian Management Inc. – submitted approximately $11.2 million in fraudulent Medicare claims for medically unnecessary power wheelchairs and orthotic devices. If convicted on all counts in the indictment, Martinez faces a maximum statutory penalty of 75 years in federal prison, and the other six defendants each face maximum sentences of 15 years in prison.
The owners of four DME companies and two of their employees were arrested on October 15 after being indicted for allegedly submitting more than $12 million in false claims to Medicare for power wheelchairs, orthotics and other medical equipment that the conspirators either did not supply, supplied to beneficiaries who did not need the equipment, or allegedly supplied to deceased beneficiaries. Christopher Iruke, 57, of Los Angeles, the owner of Pascon Medical Supply, and employee Darawn Vasquez, 25, of Inglewood, Calif., are alleged to have acquired fraudulent prescriptions and documents from individuals who recruited Medicare beneficiaries or were associated with fraudulent medical clinics. Iruke, Vasquez and Iruke’s wife, Connie Ikpoh, 47, also of Los Angeles; as well as Jummal Joy Ibrahim, 54, of Las Vegas; and Asia Fowler, 38, of Pacoima, Calif.; who were the alleged owners of Horizon Medical Equipment and Supply Inc., Contempo Medical Equipment Inc., and Ladera Medical Equipment Inc., are alleged to have used the fraudulent prescriptions and documents Iruke and Vasquez acquired to submit approximately $12.1 million in false claims to Medicare. The indictment charges a sixth defendant, Aura Marroquin, 28, of Los Angeles, with participating in the scheme. If convicted on the charges alleged in the indictment, the six defendants face maximum possible sentences ranging from 50 years to 180 years in federal prison. A trial in this case has been scheduled for November 24.
Maria Nela Moreno, 56, of Parlier, Calif., was indicted along with a codefendant for allegedly conspiring to submit approximately $828,835 in fraudulent claims to Medicare for medically unnecessary power wheelchairs through a DME company in Canoga Park, Calif. These defendants also are charged with six counts of submitting false claims to the Medicare program. Moreno was arrested this morning in Fresno, Calif., and faces a maximum possible sentence of 70 years in prison if convicted on all charged counts.
Anait Garanfilyan, 47, of Los Angeles, was arrested on October 15 after being indicted on multiple counts related to the payment of illegal kickbacks for Medicare patient referrals to two medical clinics in Los Angeles between February 2005 and May 2006. If convicted on all charged counts, Garanfilyan faces a maximum possible sentence of 10 years in prison. Garanfilyan is scheduled to be arraigned on Monday.
Mariya Bagdasaryan, 54, and Edgar Srapyan, 26, both of Glendale, Calif., were indicted on charges of conspiring to commit health care fraud from October 2007 to December 2008. Bagdasaryan operated a fraudulent DME company called Goldberg Medical Supply and allegedly submitted approximately $779,028 in false claims to Medicare for medically unnecessary power wheelchairs and wheelchair accessories. Bagdasaryan also is charged with paying illegal kickbacks for the referral of Medicare patients to Goldberg Medical Supply. Srapyan, though a fraudulent DME company, True Care Medical Supply, is alleged to have submitted approximately $647,356 in false claims to Medicare for unnecessary power wheelchairs and wheelchair accessories. If convicted on all charged counts, Bagdasaryan faces a maximum sentence of 90 years in prison. Srapyan faces a maximum sentence of 50 years if convicted on all counts.
Adejare Ademefun, 55, of Inglewood, was indicted for allegedly conspiring with others to submit more than $850,000 in false claims to Medicare for medically unnecessary power wheelchairs. Ademefun is charged with one count of conspiracy to commit health care fraud and five counts of health care fraud. If convicted on all charged counts, Ademefun faces a maximum possible sentence of 60 years in prison.
Sylvester Ijewere, 49, of Arleta, Calif., was named in a criminal complaint charging him with one count of health care fraud. Ijewere is associated with a DME company called Maydads that allegedly was used to submit nearly $500,000 in false claims to Medicare. Ijeware was arrested this morning. If convicted, Ijewere faces a maximum possible sentence of 10 years in federal prison.
An indictment merely contains allegations that a defendant or defendants have committed a crime. Every defendant is presumed innocent unless and until proven guilty at trial.
The cases are being prosecuted by Assistant U.S. Attorneys Christopher Lui, April A. Christine, Kerry O’Neill and Steven Arkow of the U.S. Attorney’s Office for the Central District of California, and Trial Attorney Jonathan Baum of the Criminal Division’s Fraud Section. The cases were investigated by the FBI; the Department of Health and Human Services, Office of Inspector General (HHS-OIG); and the California Department of Justice, Bureau of Medical Fraud and Elder Abuse.
The case was brought as part of the Medicare Fraud Strike Force, supervised by Deputy Chief Kirk Ogrosky of the Criminal Division’s Fraud Section and Acting U.S. Attorney for the Central District of California George S. Cardona. Assistant U.S. Attorney Vince Farhat is the Strike Force coordinator in Los Angeles. Since inception in March 2007, Strike Force operations in four districts have resulted in indictments of 331 individuals who collectively have falsely billed the Medicare program for more than $720 million. In addition, HHS’ Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov
Anyone with information that could assist the ongoing Strike Force investigation is encouraged to contact investigators with the Department of Health and Human Services by calling 1-800-HHS-TIPS, or emailing [email protected].
Garanfilyan Indictment
Strike Force Iruke Indictment
Strike Force Martinez Indictment
Strike Force Ademefun Indictment
Strike Force Bagdasaryan Indictment
Justice Department Files Lawsuit Against Mort’s Concrete and Owner, to Enforce Employment Rights of Wisconsin Army National GuardsmanRead the Press Release
WASHINGTON – The Justice Department today filed a lawsuit against Mort’s Concrete Inc. and its owner, Kevin Mortimer, for allegedly violating the rights of Wisconsin Army National Guardsman Rocco Sylvester Jr. by failing to properly re-employ him when he returned from active military duty in Iraq. The lawsuit alleges that Mort’s Concrete and Mortimer violated the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA), which, subject to certain limitations, requires that individuals who leave their civilian jobs to serve in the military be promptly re-employed by their civilian employers in the same positions, or in positions comparable to the positions they would have held had their employment not been interrupted by military service.
According to the department’s complaint, filed in the U.S. District Court in Madison, Wis., Mort’s Concrete and Mortimer violated USERRA by not reemploying Sylvester in his previous position as a full-time construction foreman upon his return from active duty. Instead, Mort’s Concrete and Mortimer re-employed Sylvester in a non-supervisory laborer position with significantly fewer work hours. The department seeks to recover the lost wages and benefits that Sylvester would have received had he been properly re-employed as a full-time foreman.
"Members of the military who put their lives on the line to protect our nation deserve to know they will not be penalized for their service and their bravery," said Thomas Perez, Assistant Attorney General for the Civil Rights Division. "The Justice Department is committed to protecting the rights of those who, through their bravery and sacrifice, secure the freedom and civil rights of all Americans."
The Labor Department’s Veterans’ Employment and Training Service investigated and attempted to resolve Sylvester’s USERRA complaint before referring it to the Justice Department for litigation.
The Justice Department’s Civil Rights Division has given a high priority to the enforcement of service members’ rights under USERRA. This is the 20th USERRA lawsuit the Civil Rights Division has filed in 2009 on behalf of service members. Additional information about USERRA can be found on the Justice Department’s Web sites at http://www.justice.gov/crt/emp and http://www.servicemembers.gov, as well as on the Labor Department’s Web site at http://www.dol.gov/vets/programs/userra/main.htm.
Attorney General Holder Recognizes Department Employees and Others for Their Service at Annual Awards CeremonyRead the Press Release
WASHINGTON — Attorney General Eric Holder recognizes 247 department employees for their distinguished public service today at the 57th Annual Attorney General Awards Ceremony. Thirty-nine other individuals outside of the department are also honored for their work. Held at DAR Constitution Hall, this annual ceremony recognizes both department employees and others for their dedication to carrying out the Department of Justice’s mission.
“It is my privilege to honor these recipients for their outstanding service and commitment to our country,” Attorney General Holder said. “Each of these dedicated servants has carried out the important mission of the Department of Justice and has done so with excellence and distinction. Their varied accomplishments have advanced the interests of justice on behalf of the American people, and I’m proud to call them my colleagues.”
Attorney General Holder and Deputy Attorney General David W. Ogden presented the Attorney General’s Award for Exceptional Service – the department’s highest award – to the team responsible for the prosecution of United States v. Ferguson.The Attorney General’s Award for Exceptional Service is the department’s highest award.
The Attorney General’s Award for Exceptional Service is presented to the team whose investigation and prosecution ended a three-year crime spree, headed by former Los Angeles Police Department Officer Ruben Palomares. The six-year investigation and prosecution that broke this conspiracy resulted in 15 individuals pleading guilty and the conviction at trial of two others. Through their tireless dedication, teamwork, creativity and legal skill, they helped restore a sense of justice to victims and communities who had been preyed upon by the very people who had sworn to serve and protect them.
The recipients of the Attorney General’s Award for Exceptional Service include, from the Department of Justice’s Civil Rights Division, Jeffrey S. Blumberg, Special Litigation Counsel; Joshua D. Mahan, Trial Attorney; from the U.S. Attorney’s Office for the Central District of California, Douglas McKinley Miller, Assistant U.S. Attorney; and from the Federal Bureau of Investigation (FBI) Los Angeles Division, Special Agent Philip J. Carson.
The Attorney General’s Award for Exceptional Heroism is given to recognize an extraordinary act of courage and voluntary risk of life during the performance of official duties. This year, the award was presented to Anthony J. Layfield, Senior Officer Specialist of the Federal Bureau of Prisons U.S. Penitentiary in Atlanta.
Anthony J. Layfield is honored for his commendable act of heroism. On June 2, 2008, a fellow officer was violently attacked by a highly aggressive inmate. As a result of Officer Layfield’s quick, decisive actions, and his continued attentiveness and dedication to duty, the life of a staff member was saved. This heroic act spared a family the loss of a husband and a father.
The Edward H. Levi Award for Outstanding Professionalism and Exemplary Integrity is presented to pay tribute to the memory and achievements of former Attorney General Edward H. Levi, whose career as an attorney, law professor and dean, and public servant exemplified these qualities in the best traditions of the department. Edwin S. Kneedler, Deputy Solicitor General for the Office of the Solicitor General, is presented the award this year.
Mr. Kneedler played an indispensable role in complex and time-consuming intra-governmental deliberations on diverse matters of great sensitivity and importance, including the handling of congressional subpoenas of former presidential advisors and presidential records, the proper treatment of Guantanamo detainees, the release of Office of Legal Counsel opinions, and the appropriate role and uses of presidential signing statements.
The Mary C. Lawton Lifetime Service Award recognizes employees who have served at least 20 years in the department and have demonstrated high standards of excellence and dedication throughout their careers. This year’s award is presented to William J. Edwards, First Assistant U.S. Attorney for the Northern District of Ohio. Mr. Edwards is recognized for his outstanding legal expertise, managerial and supervisory skills, and his active leadership role as the interim U.S. Attorney for the Northern District of Ohio. For more than 40 years, Mr. Edwards has fostered strong relationships throughout his federal career with the Executive Office for U.S. Attorneys (EOUSA) and other heads of federal, local and state agencies in support of the law enforcement efforts of this District. Mr. Edwards is an exceptional individual and role model who epitomizes professionalism and dedication as an outstanding federal employee.
The William French Smith Award for Outstanding Contributions to Cooperative Law Enforcement is an honorary award granted to recognize state and local law enforcement officials who have made significant contributions to cooperative law enforcement endeavors. This year’s award is presented to Detective Deborah K. Scates oftheHartford, Conn., Police Department and Sergeant Christopher McKee of the Windsor, Conn., Police Department for their the investigation and prosecution of United States v. Paris, et al., a high-profile sex trafficking case that resulted in the conviction of 10 individuals and the rescue of multiple women and juvenile girls that the individuals exploited.
The Attorney General’s Award for Meritorious Public Service is the top public service award granted by the department, and is designed to recognize the most significant contributions of citizens and organizations that have assisted the Department of Justice in the accomplishment of its mission and objectives. This year’s award is presented to a team from the Federal Correctional Institution (FCI) in Miami, Fla. Recipients include Dr. Selma DeJesus, Chief Psychologist; Dr. Sherri Skibinski, Drug Abuse Program Coordinator Nestor Chavez, Supervisor of Education; Lori Bearden, Case Manager; Giovanni Gras, Teacher; Mark Jones, Correctional Counselor; and Paola Londono, Unit Secretary. These award recipients developed the Inmate Change and Alternative Network (ICAN). ICAN is part of a re-entry program that focuses on networking with Federal, State, and local agencies to create a partnership and/or referral network that provides services to equip inmates for release.
The Attorney General’s Award for Distinguished Service is the Justice Department’s second highest award for employee performance. The recipients of this award exemplify the highest commitment to the department’s mission. Seventeen Distinguished Service Awards were presented this year to individuals or teams of people.
One award is presented to members of a team from the National Criminal Enforcement Section of the Justice Department’s Antitrust Division including Mark R. Rosman, Assistant Chief, and Trial Attorneys Brent C. Snyder, Kathryn M. Hellings, Mark C. Grundvig and Elizabeth A. Aloi. Through the team’s leadership, dedication, and exceptional investigative and litigation efforts, multiple worldwide conspiracies to fix and raise prices, rates and fees for airline passenger travel and for airline cargo shipments of goods were broken up, and competition was restored to a globally vital industry.
The Attorney General’s Award for Distinguished Service is also presented to a team honored for their extraordinary efforts throughout the fast-moving and intense trial and appellate proceedings to defend the Navy’s ability to conduct mission critical training using active SONAR prior to deployment to hot spots around the world, while at the same time working with the Navy to ensure compliance with the nation’s environmental laws. Recipients were from the Wildlife and Marine Resources Section of the Environment and Natural Resources Division, Seth M. Barsky, Assistant Section Chief; Kristen L. Gustafson and S. Jay Govindan, Senior Trial Attorneys; Kevin W. McArdle and Michael R. Eitel, Trial Attorneys; from the Natural Resources Section of the Environment and Natural Resources Division, Charles W. Findlay III, Assistant Section Chief; Charles R. Shockey, Luther L. Hajek and Guillermo A. Montero, Trial Attorneys;from the Appellate Section of the Environment and Natural Resources Division, Andrew C. Mergen, Assistant Section Chief; Allen M. Brabender, Michael T. Gray and Charles R. Scott, Trial Attorneys;from the Office of the Solicitor General, Edwin S. Kneedler, Deputy Solicitor General and Anthony A. Yang, Assistant to the Solicitor General.
Another Attorney General’s Award for Distinguished Service is presented to Assistant U.S. Attorney Phil Lynch from the Western District of Washington. Phil Lynch is recognized for his outstanding commitment to justice on both United States and international soil. For 14 years, he successfully defended the United States as a civil Assistant U.S. Attorney handling numerous, complex medical malpractice actions for the Western District of Washington. From 2005-2006, he served at the Regime Crimes Liaison Office in Baghdad, where he assisted Iraqi attorneys prosecuting crimes by the regime of Saddam Hussein. In January 2008, Mr. Lynch once again agreed to leave family and home to serve a one-year term as the Rule of Law Coordinator at the U.S. Embassy in Baghdad, which made him the most senior Department of Justice official in Iraq.
Larry W. Krisl, Special Agent, Denver Field Division, and Christopher J. Trainor, Special Agent, Baltimore Field Division, both from the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) are awarded the Attorney General’s Award for Distinguished Service. Special Agents Krisl and Trainor were assigned to the U.S. Embassy in Baghdad, Iraq, from October 2007 to September 2008. They were involved in day-to-day embassy law enforcement operations and the initiation and oversight of several high-profile investigations. Despite great personal risk they performed their duties to ensure the safety and security of others.
Seven individuals are awarded the Attorney General’s Award for Distinguished Service for their workon United States v. Eye and Sandstrom. The team obtained convictions against two violent, racially-motivated offenders. Due to this team’s hard work and excellent litigation skills, two killers were brought to justice, and an entire community's civil rights were vindicated. Award recipients from the Department’s Civil Rights Division include Eric L. Gibson, Trial Attorney; Daniel K. Rosenholtz, former Paralegal Specialist; individuals from the FBI include, Arch G. Gothard, IV, Special Agent in the Kansas City Division; Heith R. Janke, Special Agent in the San Antonio Division; members from the U.S. Attorneys Office for the Western District of Missouri include, Assistant U.S. Attorneys D. Michael Green and David M. Ketchmark; and Financial Analyst Elsie Robinson.
The Attorney General’s Award for Distinguished Service is also presented to a team responsible for “Operation Joint Hammer,” a transnational enforcement operation, which led to the identification and prosecution of scores of dangerous child sex offenders throughout the world. Recipients from Also awarded the Attorney General’s Award for Distinguished Service are Senior Officers Andrew Cruickshank and Jose Gonzalez from theFederal Correctional Complex, Lompoc, Calif., for their life saving efforts on behalf of an inmate. Mr. Cruickshank and Mr. Gonzalez performed CPR on an inmate for more than 15 minutes while waiting for paramedics to arrive. Their efforts saved an individual’s life and inspired other staff to become certified in CPR. the Department of Justice’s Criminal Division include Assistant Deputy Chief and Assistant to the Chief for the Child Exploitation and Obscenity Section Steven J. Grocki and James M. Fottrell; from the FBI’s Innocent Images Unit Investigative Operations Analyst Linda S. Ellerby; Investigative Support Specialists Julie Ann Harper and Maria E. Jackson; Industrial Security Specialist Crystal J. Tennessee; Information Technology Specialist Robert J. Williams and SupervisorySpecial Agent Mark E. Zimmerman; from the U.S. Postal Inspection Service, Postal Inspectors Clayton E. Gerber and J. Todd Bame; from the U.S. Department of Homeland Security, U.S. Immigration and Customs Enforcement (ICE), Senior Special Agent Theodore Siggins.
Also awarded the Attorney General’s Award for Distinguished Service is, from the Drug Enforcement Administration’s (DEA) Phoenix Field Division, Group Supervisor Mark J. Benek and Special Agents Stephanie J. Barta, Joshua F. Cluff, Karl W. Hedrick, Daniel Mehdi, Brandon Moore, Daniel E. Moritz and Robert L. Wardle; and from the Phoenix Police Department Task Force Officer Danny Valadez. The Phoenix Strike Force Group 1 receives this award for their outstanding Organized Crime Drug Enforcement Task Force (OCDETF) investigations aimed at dismantling a significant drug trafficking and money laundering organization. Because of the team’s talent, dedication, and hard work, the Verdugo-Calderon Organization suffered significant damage, including the loss of its primary leadership and significant disruption to its drug trafficking activities that reached from Mexico and throughout the United States.
Another Attorney General’s Award for Distinguished Service is presented to the prosecution team that successfully investigated and prosecuted the Vasquez-Valenzuela family, which committed acts of forced prostitution by young women and minors they smuggled into the country from Guatemala. Members of the team included, from the U.S. Attorney’s Office for the Central District of California, Cheryl O’Connor Murphy, Curtis A. Kin, Anthony J. Lewis, and Sarah J. Heidel, Assistant U.S. Attorneys, and Paralegal Specialist Rochelle Wong; from the Department of Justice’s Civil Rights Division’s Criminal Section, Special Litigation Counsel Andrew J. Kline, Trial Attorney Cyra O’Daniel, and Paralegal Specialist Connie Lee; from the FBI’s Los Angeles Field Office, Special Agents Tricia Whitehill and Valerie Venegas; fromU.S. Department of Homeland Security, ICE, Special Agent Miguel Palomino; and from theOffice of the Inspector General, U.S. Department of Labor, Special Agent Jesus Quezada Jr.
Also awarded the Attorney General’s Award for Distinguished Service was the prosecution team for United States v. Pavel Lazarenk. It was the first prosecution of a foreign political leader for laundering the proceeds of foreign crimes involving political corruption, fraud and extortion through financial institutions in the United States. Award recipients from the U. S. Attorney’s Office for the Northern District of California include, Peter B. Axelrod, Patricia J. Kenney, Stephanie Hinds and Hartley M.K. West, Assistant U.S. Attorneys; Jonathan R. Howden and Martha A. Boersch, Former Assistant U.S. Attorneys; Christine Y. Tian, Paralegal Specialist; from the department’s Criminal Division’s Organized Crime & Racketeering Section, Hallie A. Mitchell, former Trial Attorney; Amelia Lucero-Cordes, Paralegal Specialist; from the FBI Moscow Office, Bryan Earl, Legal Attaché; from the U.S. Department of Treasury, Internal Revenue Service (IRS), San Francisco District Office, Supervisory Special Agent Bennett Hong; and Charles A. Tonna, Internal Revenue Agent.
Seven individuals were awarded the Attorney General’s Award for Distinguished Service for their workin the prosecution of Michael Joseph Pepe, a U.S. citizen who traveled to Cambodia to purchase young girls from their parents. As a result of the prosecution team's commitment, dedication and exemplary efforts, a Los Angeles jury convicted Mr. Pepe of engaging in illicit sexual conduct in foreign places. Award recipients included, from the U.S. Attorney’s Office for the Central District of California, Assistant U.S. Attorneys Patricia A. Donahue, John J. Lulejian and Elizabeth R. Yang; from the U.S. Department of Homeland Security, ICE, Special Agents Gary J. Phillips, Eddy Wang and Paul Carbone; andForeign Service National Vansak Sous.
Frank H. Anderson III, Special Assistant to the Chief Information Officer in the Justice Management Division’s Office of the Chief Information Officer is awarded the Attorney General’s Award for Distinguished Service for his sustained outstanding leadership, and overall management of the department’s communication needs for nearly 20 years. His oversight and direction have guided the complex and successful efforts of the Office of the Chief Information Officer while simultaneously providing services across the department components and to their executive officers.
The Attorney General’s Award for Distinguished Service is also awarded to, from the Department of Justice’s National Security Division, Counterterrorism Section Sharon Lever, Deputy Chief; Joanna Baltes, Trial Attorney; from the U.S. Attorney’s Office for the Central District of Illinois, David E. Risley, Assistant U.S. Attorney; Jaci L. Carrell, Paralegal Specialist; from the U.S. Attorney’s Office for the Eastern District of Virginia, Marla Tusk, Assistant U.S. Attorney; from the FBI Aman Jordan Office, Timothy P. Kirkham, Legal Attaché; from the FBI Springfield, Ill., Division, John H. Stafford, Assistant Special Agent in Charge; Matthew J. Iskrzycki, Supervisory Special Agent; Scott B. Easton, Special Agent; Thomas Michael Shanahan, Mary Kay Eades and Rebecca L. Miller, Intelligence Analysts; from the FBI Counterterrorism Division, Jacqueline Maguire, Supervisory Special Agent, and Hillary Brie Sommer, Intelligence Analyst.; and from the FBI Critical Incident Response Group Nicholas Zambeck, Special Agent. This team received the award for their relentless and innovative efforts in the investigation and prosecution of Ali Saleh Kaleh Al-Marri. The trial team unraveled an international conspiracy and successfully completed one of the most high-profile terrorism cases in the department’s history.
The Attorney General’s Award for Distinguished Service is awarded to a team honored for their outstanding efforts to produce four reports of investigation relating to allegations of politicized hiring within the Department of Justice, which resulted in the removal of nine U.S. Attorneys in 2006. Recipients include, from the Department of Justice’s Office of the Inspector General Oversight and Review Division, Carol F. Ochoa, Assistant Inspector General for Oversight and Review; Nina S. Pelletier and Mark S. Masling, Investigative Counsels; Joseph Symcak, Senior Special Agent; Judy A. Sutrich, Senior Program Analyst; Jason R. Higley, Special Agent; Dominic N. Russoli, Paralegal Specialist; from the Department of Justice’s Office of the Inspector GeneralEvaluations and Inspections Division, Gina J. Wong, Senior Program Analyst; Cheron D. Cooper and Katherine A. Zownir, Program Analysts; Cynthia A. Schnedar, Counselor to the Inspector General, William M. Blier, Senior Counsel to the Inspector General; from the Department of Justice’s Office of Professional Responsibility, William J. Birney, James D. Duncan and Tamara Jaycox Kessler, Associate Counsels; Raymond C. Hurley, Senior Assistant Counsel; Margaret S. McCarty, Assistant Counsel; from the Department of Justice’s Criminal Division, Asset Forfeiture and Money Laundering Section, Deputy Chief of Policy, James A. Meade.
An Attorney General’s Award for Distinguished Service is also awarded to Glenn E. Belgard, Deputy U.S. Marshal of the U.S. Marshals Service Fugitive Task Force. Belgard receives the award for his outstanding leadership and investigative skill in coordinating a U.S. Marshals Service led Fugitive Task Force in central Louisiana. Deputy Belgard has been recognized by community leaders, local, state and federal law enforcement agencies, and the Royal Canadian Mounted Police for arrests of some of the nation’s most dangerous felons. Deputy Belgard’s accomplishments in fugitive investigations and his skillful service to the U.S. Marshals Service and the Department of Justice exemplifies professional law enforcement.
Phyllis J. Pyles, Director of the Department of Justice’s Civil Division Torts Branch receives the Attorney General’s Award for Distinguished Service for her tenacious and intelligent defense of the United States for more than three decades in tort litigation. She has had a critical role in the development of laws protecting the United States from lawsuits. Her work has consistently met the highest standards of professional excellence.
John D. Griffith, Assistant U.S. Attorney for the District of Columbia; from the Department of Justice’s Criminal Division, Fraud Section, Mark F. Mendelsohn, Deputy Chief; Lori A. Weinstein, Trial Attorney; Pamela Johnson, Paralegal Specialist; from the FBI Washington Field Office, Brian J. Smith and Paula L. Ebersole, Special Agents; and Troy Burrus and Howard Smith, from U.S. Department of Treasury, IRS, are presented with the Attorney General’s Award for Distinguished Service for outstanding performance in the investigation and prosecution ofSiemens AG, a German engineering company. The department’s investigation uncovered evidence of hundreds of millions of dollars of corrupt payments in dozens of countries spanning several decades, and in virtually every Siemens operating group and region. The Department’s prosecution was announced simultaneously and coordinated with a civil enforcement action by the Securities and Exchange Commission (SEC) and a criminal prosecution by the Munich Public Prosecutor’s Office, resulting in overall sanctions of more than $1.6 billion. The Department of Justice’s coordination of its settlement not only with the SEC, but also with a foreign regulator sets a new standard in international cooperation and coordination, and serves as a model for future global anti-corruption enforcement.
The Award for Excellence in Law Enforcement recognizes outstanding professional achievements by law enforcement officers of the Department of Justice. Four Excellence in Law Enforcement Awards are awarded this year.
The Award for Excellence in Law Enforcement is presented toa team from the U.S. Marshals Service Regional Fugitive Task Force Program. The team is honored for their outstanding efforts and exceptional service in the reduction of violent crime and gang activity, and the apprehension of more than 33,000 fugitive felons, more than 1,200 of whom were wanted for murder, during the past fiscal year. Members include from the Southeast Regional Fugitive Task Force, Chief Inspector Keith Booker; from the Pacific Southwest Regional Fugitive Task Force, Chief Inspector Thomas Hession; from the New York/New Jersey Regional Fugitive Task Force, Chief Inspector Lenny DePaul; from the Gulf Coast Regional Fugitive Task Force, Chief Inspector Michael Richards; from the Capital Area Regional Fugitive Task Force, Chief Inspector Rob Fernandez; and from the Great Lakes Regional Fugitive Task Force, Chief Inspector Geoff Shank.
Another Award for Excellence in Law Enforcement is presented to John “Mickey” Welch, Special Agent, ATF Nashville Field Division for his leadership and outstanding investigative ability. This is demonstrated by the successful racketeer influenced and corrupt organizations investigation and prosecution of the violent street gang MS-13 in Nashville, Tenn.
Special Agents Richard Bachour, Christopher Goumenis and Sharon Lindskoog, from the DEA Miami Field DivisionGroup Supervisor Brian McKnight; from the DEA Bogota Country Office Group Supervisor John Gazzara; andSpecial Agent Adam Allen are honored with the Award for Excellence in Law Enforcement for their participation in Operation Titan, a multi-jurisdictional Consolidated and Regional Priority Organization Target DEA investigation of drug trafficking and money laundering organizations. Coordinated efforts under the auspices of the Operation Titan team have resulted in the arrest of more than 107 domestic and international targets, seizure of more than $40 million, more than $2 million in other related assets (to include three aircraft), 26 international bank accounts, more than 3,700 kilograms of cocaine and 10 kilograms of heroin.
Also awarded the Award for Excellence in Law Enforcement was from the FBI Salt Lake Division, Special Agents Michael J. Gnecknow and Gail L. Gnecknow; Supervisory Special Agent Donald E. Robinson, Jr.; Investigative Operations Analyst Dorothy A. Broyles; Evidence Technician Esther Tamez; Financial Analyst Michele E. Lewis; from the U.S. Attorney’s Office for the District of Idaho Assistant U.S. Attorneys Wendy Olson and Traci Whelan; Paralegal Specialist Denise Price; AutomatedLitigation Support Specialist Pamela J. Rocca; andVictims Witness Specialist Kristi Johnson. This team receives the award for their exemplary efforts during a three-year long investigation of a brutal triple homicide and the abduction of two children in Coeur d’Alene, Idaho, in May 2005. As a result of their efforts, a violent serial sexual predator was arrested, and one of the abducted children was recovered.
The Attorney General’s Award for Excellence in Management recognizes outstanding administrative or managerial achievements that have significantly improved operations and productivity, or reduced costs. Three Excellence in Management Awards are presented this year.
Paul J. Copenhaver, Warden at the Federal Correctional Institution (FCI) in Dublin, Calif., is awarded the Attorney General’s Award for Excellence in Management for maintaining high expectations of staff and inmates. He is directly responsible for the planning and oversight of security enhancements and procedures at the FCI in Dublin. Through constant oversight, he engineered a 32 percent reduction in overtime expenditures. His leadership and knowledge have made him a valuable resource for the Bureau of Prisons (BOP) and other federal agencies, providing significant contributions to the overall management of staff, inmates and general operations of FCI Dublin.
Another Attorney General’s Award for Excellence in Management was presented to the Grid Computing Initiative Implementation Team for their creative insight and dedication in the implementation of a virtual supercomputer across the FBI Trilogy network. Award recipients include, from the FBI’s Operational Technology Division, Jesse H. Taylor, Senior Cryptologic Mathematician; Vivian K. Clifton, Electronics Engineer; Paul S. Driscoll, Supervisory Information Technology Specialist; An Q. Nguyen and Chad Richard Loewenstine, Mathematicians.
Maggie K. Hansen, Supervisory Librarian, Robert F. Kennedy Building Main Library, in the department’s Justice Management Division also received the Attorney General’s Award for Excellence in Management. Hansen is recognized for assisting litigation efforts by all department components through her legislative history research. Ms. Hansen foresaw the importance of developing a historical archive of departmental documents, speeches, and memorabilia by and about the department. This collection has been instrumental in providing necessary primary sources to Department of Justice components.
The Attorney General’s Award for Excellence in Information Technology recognizes outstanding achievements in applying information technology to improve operations and productivity reduce or avoid costs and solve problems.
James Mark Fleshman, Chief Information Officer for the Executive Office for U.S. Attorneys (EOUSA) receives the award for outstanding innovation and leadership in the development and management of EOUSA’s and the U.S. Attorneys Office’s (USAO) information management and information technology resources, which are deployed nationwide in more than 200 staffed sites. For the past decade, he has served as a highly effective change agent and as a member of the management team, has planned and implemented creative approaches resulting in improved U.S. Attorneys Offices’ operational effectiveness and efficiency at reduced costs.
An Attorney General’s Award for Excellence in Information Technology is awarded to the team that developed and deployed the Innocence Lost Database (ILD) to assist local, state and federal law enforcement officers working child prostitution matters. Team members include from the FBI’s Criminal Investigation Division Crimes Against Children Unit, Jamie L. Konstas, Intelligence Analyst; from the FBI’s Washington Field Office, Heather L. Gordon, Intelligence Analyst; and from the FBI Information Technology Operations Division, Office of the Chief Technology Officer, Christopher N. Carrino, Computer Scientist.
The Attorney General’s Award for Excellence in Furthering the Interests of U.S. National Security recognizes outstanding achievements and contributions towards protecting U.S. national security. Recipients are, from the FBI, New York City Division, Zachary J. Miller, Assistant Special Agent in Charge; John F. Karst, Jr. and Elisabete Santos, Supervisory Special Agents; Lionel A. DeSilva, James E. Dennehy, Stephen Fullington, William G. Smith, John J. Hartnett, Robert Kravec, Sara Poole, Michael R. Bickings, Robert B. Booth, Carol A. Motyka, Peter G. Diaz and Daniel S. Kim, Special Agents.
This group is recognized for their exemplary, tireless performance in connection with a multi-faceted, long-term investigation, which utilized numerous resources and sophisticated techniques. These agents displayed exceptional leadership, managerial and investigative skills throughout this complex investigation. The group’s exceptional service and achievements greatly enhanced and will continue to contribute to the overall intelligence base available to the U.S. intelligence community. The extraordinary efforts resulted in the production of vital intelligence that enabled policy makers to further shape U.S. foreign policy and protect U.S. national security interests.
The Attorney General’s Award for Equal Employment Opportunity is the department’s highest award for performance in support of the Equal Employment Opportunity (EEO) Program. This year’s recipient is Suzanne L. Bell, Deputy Director for Legal Recruitment and Outreach, Office of Attorney Recruitment and Management. Suzanne L. Bell is honored for her superior management of the department’s legal hiring programs. In addition to her exemplary accomplishments in recruitment and outreach, she has been instrumental in creating and implementing several new training initiatives, and offering critical support for new attorneys and current supervisors.
The Attorney General’s Award for Excellence in Legal Support recognizes outstanding achievements in the field of legal support to attorneys by paralegal specialists and other legal assistants. The recipients in the Paralegal Category are, from the Environment and Natural Resources Division, Environmental Crimes Section, Supervisory Paralegal Specialist William N. Taylor; from the U.S. Attorney’s Office for the Northern District of Georgia, Paralegal Specialist Marti P. Goldring. Recipients from the Legal Support Category are, from the Environment and Natural Resources Division, Natural Resources Section, Diana (Deedee) Sparks; and from theExecutive Office of U.S. Trustees – Dallas, TexasLegal Clerk Christi C. Flanagan.
The Attorney General’s Award for Excellence in Administrative Support recognizes outstanding performance in administrative or managerial support by an administrative employee or secretary. Recipients in the Administrative Category are, Misti L. Kloubec, Administrative OfficerBudget Analyst, U.S. Attorney’s Office for the Northern District of Iowa; and Peggy C. Taylor, Administrative Officer, Region 7, U.S. Trustees Program. The recipient in the Secretarial Category is Rosa F. Rach, Administrative Assistant, Drug Enforcement Administration Operations Division.
The Attorney General’s Award for Outstanding Service in Freedom of Information Act Administration recognizes exceptional dedication and effort to the implementation of the Freedom of Information Act (FOIA). This year’s recipient from the U.S. Marshals Service is Associate General Counsel William Edward Bordley. By implementing new initiatives such as the FOIA/Privacy Act Web site and electronic reading room, Mr. Bordley greatly enhanced accessibility of information to U.S Marshals Service employees and the public.
The Attorney General’s Award for Fraud Prevention recognizes exceptional dedication and effort to prevent, investigate and prosecute fraud, white-collar crimes and official corruption. Two awards are presented this year. The Attorney General’s Award for Fraud Prevention is presented to the team responsible for prosecuting the largest pharmaceutical fraud case in the history of the Department of Justice. Receiving the award are, from the U.S. Attorney’s Office for the Eastern District of Pennsylvania, Catherine L. Votaw, Joseph A. Trautwein, Denise S. Wolf, Marilyn May, Alvin Stout, Nancy Rue, and Margaret Hutchinson, Assistant U.S. Attorneys; Denis Cooke and Alison Barnes, Auditors; from the Department of Justice’s Civil Division, Consumer Litigation Branch, Jeffrey Steger and Ross Goldstein, Trial Attorneys; Regina Hosey, Paralegal; from the Civil Division, Frauds Section, Patricia R. Davis, Assistant Director; Patricia Hanower, Trial Attorney.
The Attorney General’s Award for Fraud Prevention is also presented to, from the U.S. Attorney’s Office for the Central District of California, George S. Cardona, Acting U.S. Attorney: Richard E. Robinson, and Douglas A. Axel and George S. Cardona, Assistant U.S. Attorneys; from the U.S. Postal Inspection Service, James Harbin, Catherine Budig and Loretta Cummings, Postal Inspectors; Daniel Ryan and Humberto DaFonte, Consumer Fraud Analysts; and from the U.S. Department of Treasury, IRS, Criminal Investigation Division, Special Agent Gary Tang. The team is recognized for their demonstrated excellence and perseverance in the successful investigation and prosecutions of Milberg Weiss and its senior partners.
The Attorney General’s Award for Outstanding Contributions to Community Public Safety recognizes outstanding achievement in the development and support of community partnerships designed to address public safety within a community. This year’s recipients are, from the U.S. Attorney’s Office for the District of Massachusetts, John A. Wortmann Jr. and Glenn A. MacKinlay, Assistant U.S. Attorneys; Martha Wyatt, Program Specialist; from ATF, Thomas F. Crowley, Special Agent; from Harvard University, Senior Research Associate Kennedy School of Government, Anthony Braga, PhD; from the Suffolk County District Attorney’s Office, Daniel Mulhern, Assistant District Attorney; Executive Director, Boston Ten Point Coalition, Reverend Jeffrey L. Brown; from the Boston Police Department, Sergeant Detective John Ford and Deputy Superintendant Gary French; Executive Director, Stop Handgun Violence, Laura Hyer; Director, Boston Re-entry Initiative, True-See Allah; andRe-entry Manager, Massachusetts Department of Youth Services, Christian J. Mitchell. This diverse group’s efforts serve as a model for community partnering. Faced with an alarming increase in gang-related violent crime that threatened the viability of several Boston neighborhoods, the team launched a collaborative two-year effort aimed at improving the quality of life for area residents.
Robert Scott Taylor, HVAC Foreman, U.S. Penitentiary, Lee, Va., is presented the Cubby Dorsey Award for Outstanding Contributions by a Wage Grade System Employee for numerous accomplishments in his area of expertise. Mr. Taylor completes his assignments with a high level of energy and displays the “team player” attitude necessary in a correctional environment. Mr. Taylor is a highly motivated and dedicated individual to the mechanical services discipline and the Bureau of Prisons.
The Attorney General’s Award for Outstanding Contributions by a New Employee recognizes exceptional performance and notable accomplishments towards the department’s mission by an employee with fewer than five years of federal career service. Recipients are, Kenneth Moore, Senior Correctional Officer, Federal Correctional Complex, Coleman, Fla.; Aaron J. Mango, Assistant U.S. Attorney, White Collar and General Crimes Division, Western District of New York; Catherine Anne Chess Chen, General Attorney, Office of the FBI General Counsel; Trisha B. Anderson, Attorney Adviser in the Department of Justice’s Office of Legal Counsel; Zana M. Scarlett, Trial Attorney, Miami Office, Executive Office for U.S. Trustees.
The John Marshall Awards are the Department of Justice’s highest awards offered to attorneys, for contributions and excellence in specialized areas of legal performance. Eleven awards in nine categories are presented this year.
The John Marshall Award for Trial of Litigation is presented to, from the Department of Justice’s Criminal Division, Narcotic and Dangerous Drug Section, Deputy Section Chief Julius Rothstein and Trial Attorney Matthew R. Stiglitz; and Deputy Chief for Policy and Appeals, Teresa Wallbaum. The team is recognized for exceptional service to the department and nation for their relentless efforts in the investigation and conviction of Taliban cell leader Khan Mohammed.
The John Marshall Award for Trial of Litigation is also presented to the team that litigated AWG Leasing Trust v. United States, the first case to go to trial involving the abusive sale in/lease out tax shelter. Recipients include, from the Department of Justice’s Tax Division, Civil Trial Section, Southern Region Assistant Chief Angelo A. Frattarelli; from the Northern Region, Trial Attorneys Robert Kovacev, Matthew Von Schuch and Karen Smith.
The John Marshall Award for Participation in Litigation was awarded to the National Association of Realtors (NAR) trial team. This team earned an important victory for competition and consumers when NAR reversed its position and agreed to a comprehensive settlement shortly before trial. Members of the team include, from the Department of Justice Antitrust Division, Litigation I Section, Trial Attorney Steven B. Kramer; from the Networks and Technology Enforcement Section, Trial Attorney Travis R. Chapman; from the Antitrust Division, Litigation III Section, Assistant Section Chief David C. Kully; and Trial Attorneys, Craig W. Conrath, Timothy T. Finley, Lisa A. Scanlon, William H. Jones II, Owen M. Kendler and Mary Beth McGee.
Another John Marshall Award for Participation in Litigation is awarded to, from the Department of Justice Tax Division, Office of the Assistant Attorney General Kevin M. Downing, Senior Level Trial Attorney; Michael P. Ben'Ary, Trial Attorney, Northern Criminal Enforcement Section; Frank P. Cihlar, Trial Attorney, Criminal Appeals and Tax Enforcement Policy Section; and from the U.S. Attorney’s Office for the Southern District of Florida, Jeffrey A. Neiman, Assistant U.S. Attorney. This team is recognized for their outstanding work in negotiating the deferred prosecution agreement with UBS, the largest bank in Switzerland and one of the largest worldwide.
The John Marshall Award for Support of Litigation is presented to the Navajo Trust Litigation Team members for their extraordinary efforts in multiple trial, appellate and Supreme Court proceedings over nearly a decade to defend the United States from a nearly $600 million damages claim. Award recipients include, from the Department of Justice’s Environment and Natural Resources Division Natural Resources Section, Assistant Section Chief Edward J. Passarelli; Trial Attorneys, Kristine S. Tardiff and Devon L. McCune; from the Appellate Section, Assistant Section Chief William B. Lazarus and Trial Attorney Elizabeth Ann Peterson.
The John Marshall Award for the Handling of Appeals is presented to Elizabeth D. Collery, Trial Attorney in the Appellate Section of the Department of Justice’s Criminal Division. Collery receives the award for her superlative skill in appellate advocacy. With intelligence and integrity, Ms. Collery has presented prosecutions time and time again. She has compiled a list of victories in some of the department’s most difficult criminal cases.
This year’s John Marshall Award for Providing Legal Advice is presented to Paul Michael Brown, Senior Counsel for Instructional Activitiesfrom the Department of Justice’s Civil Division, Tort Branch, Constitutional and Specialized Tort Litigation. Brown is honored for providing legal advice related to defending federal employees in personal liability litigation. During 21 years with the department, he has worked tirelessly to share his expertise with Assistant U.S. Attorneys and agency counsel nationwide in a variety of creative and cost effective ways.
The John Marshall Award for Preparation or Handling of Legislation is awarded to the Department of Justice’s Environment and Natural Resources Division’s Lacey Act Team. This team led the administration’s efforts, in close coordination with several client agencies, to obtain amendments to the Lacey Act, a 100-year-old statute that has served as the principal anti-trafficking authority in the United States to protect a broad range of fish and wildlife. Recipients include, from the Law and Policy Section, Assistant Section Chief Karen M. Wardzinskiand Attorney Advisor, Thomas W. Swegle; and from the Environmental Crimes Section, Senior Trial Attorney Elinor Colbourn and Assistant Section Chief John T. Webb.
The John Marshall Award for Asset Forfeiture is presented to Lucille C. Roberts, Deputy General Counsel from the U.S. Marshals Service. Roberts receives the award for her distinguished service as the primary point of contact for the U.S. Marshals Service on matters related to asset seizure and forfeiture.
David W. Gehlert, Trial Attorney from the Natural Resources Section of the Environment and Natural Resources Division is awarded the John Marshall Award for Dispute Resolution for his outstanding achievements in using alternative dispute resolution to settle a long‑standing and high profile dispute over water rights for the Black Canyon of the Gunnison National Park in Colorado. Mr. Gehlert used mediation to obtain a settlement that successfully concluded more than 30 years of litigation. Throughout what proved to be long and difficult negotiations, Mr. Gehlert exhibited professionalism, integrity, skill, and creativity that upheld the highest tradition of the Department.
The John Marshall Interagency Cooperation in Support of Litigation Award is presented to the following recipients from the U.S. Department of Veterans Affairs Professional Staff Group II: Richard J. Hipolit, Assistant General Counsel; David J. Barrans, David R. McLenachen and Michael J. Timinski, Deputy Assistant General Counsels; Ethan G. Kalett, Supervisory General Attorney; and Martie S. Adelman, Y. Keun Lee, Jamie L. Mueller and Martin J. Sendek, General Attorneys. This team is honored for their thorough understanding of veterans’ compensation and pension law. Their efforts have enabled the department to take consistent and sound positions regarding veterans’ compensation and pension law before the federal courts.
Beginning in 2010, Attorney General Holder will present a new award, the Claudia J. Flynn Award for Professional Responsibility. This award is named after the late Claudia J. Flynn, the department’s first director of the Professional Responsibility Advisory Office. This award will recognize outstanding contributions by a department attorney in the very important area of professional responsibility, which until now, has not been recognized through a specific Attorney General award.
20 October 2009
U.S. Army Sergeant Pleads Guilty to Bribery and Money Laundering Conspiracy Related to Department of Defense Contracts in AfghanistanRead the Press Release
WASHINGTON — A U.S. Army Sergeant deployed to Bagram Airfield, Afghanistan, pleaded guilty today to bribery and a money laundering conspiracy arising out of her work administering transportation services, the Department of Justice announced today. The Army Sergeant has agreed to pay $90,000 in restitution to the U.S. Department of Defense (DOD) and to cooperate with the Department of Justice’s ongoing investigation.
According to the charges, filed today in the U.S. District Court for the District of New Jersey, Ana C. Chavez accepted $90,000 in cash and wire transfers as a bribe from a DOD contractor in return for Chavez exercising her influence at the Transportation Operations Support Office in the award of DOD contracts and work orders to that contractor’s company. Chavez gave a portion of the bribe proceeds to another DOD contractor working at Bagram Airfield, with whom she conspired to launder the money through various bank accounts held by Chavez’s associates in the United States. According to the court documents, the alleged conduct began at least in or about February 2005 and continued until September 2006.
Chavez pleaded guilty to one count of bribery and one count of conspiracy to commit money laundering. A violation of the bribery statute carries a maximum sentence of 15 years in prison and a fine of $250,000 or three times the value of the bribe. A violation of the money laundering conspiracy statute carries a maximum sentence of 20 years in prison and a fine of $500,000 or twice the value of the laundered funds. The maximum fine could be increased to twice the gain derived from the crimes or twice the loss suffered by the victims of the crimes if either of those amounts is greater than the statutory maximum fine.
Today’s charges are the result of an ongoing investigation prosecuted by the Antitrust Division’s National Criminal Enforcement Section (NCES), with assistance from the Criminal Division’s Office of International Affairs. The investigation of this case is being conducted by the Defense Criminal Investigative Service (DCIS), the U.S. Army Criminal Investigation Command (Army CID) and the Air Force Office of Special Investigations. Additional assistance was provided by the Internal Revenue Service, Criminal Investigations Division.
Today’s charges are an example of the Department of Justice’s commitment to protect U.S. taxpayers from procurement fraud through the National Procurement Fraud Task Force. The National Procurement Fraud Initiative, announced in October 2006, is designed to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in contracting activity for national security and other government programs.
Anyone with information concerning illegal conduct in the procurement of goods or services involving DOD contracts in Afghanistan is urged to contact NCES at 202-307-6694 or [email protected]; DCIS at 800-424-9098 or [email protected]; or Army CID at http://www.cid.army.mil.
Two Colorado Residents Indicted for Illegally Killing and Selling BobcatsRead the Press Release
WASHINGTON—A federal grand jury in Denver returned a 15-count felony indictment yesterday charging two individuals with conspiracy, wildlife trafficking and firearms violations stemming from the illegal trapping, killing and selling of bobcats and their pelts, the Justice Department announced.
The indictment charges both Jeffrey M. Bodnar and Veronica Anderson-Bodnar with conspiracy to violate the Lacey Act, two substantive violations of the Lacey Act and two violations of the Lacey Act for false records. Bodnar was also charged with seven firearms violations for possession of a firearm by a felon. Anderson-Bodnar was charged with two violations for transferring firearms to a felon.
The Lacey Act is a federal law that makes it illegal to transport or sell in interstate commerce any wildlife taken, possessed, transported or sold in violation of state law or regulation. Bobcats, whether alive or dead, are considered wildlife under both the Lacey Act and Colorado law.
The indictment alleges that from November 2006 until March 2008, Bodnar and Anderson-Bodnar conspired to knowingly transport and sell bobcat and bobcat pelts in interstate commerce that were unlawfully trapped and killed without a license and using prohibited leghold traps in violation of state law. The two also conspired to knowingly submit false records and accounts of how the bobcats were trapped for tagging by Colorado wildlife officials.
According to the indictment, Bodnar trapped and killed bobcats before, during and after the legal bobcat hunting season at different locations in and around Park County, Colo., including U.S. Forest Service property. He did so without a valid license, used leghold traps that were prohibited and then killed the trapped animals with a firearm.
The indictment further alleges that Anderson-Bodnar on more than one occasion took the bobcat pelts to the Colorado Division of Wildlife Office to be tagged. She provided information to complete the required records for the pelts and falsely certified that each had been taken legally in Colorado.
In 2006, Anderson-Bodnar responded to a newspaper advertisement placed in a Colorado paper by a fur-buyer based in Montana. The indictment alleges multiple transactions thereafter were made across state lines with the fur-buyer from Montana and Bodnar and Anderson-Bodnar.
The indictment also alleges that Bodnar and Anderson-Bodnar sold four bobcat pelts to an undercover U.S. Fish and Wildlife Service agent at their Colorado residence after the agent stated he was from out of state.
An indictment is merely an accusation, and a defendant is presumed innocent unless and until proven guilty in a court of law.
The maximum penalty for a felony violation of the Lacey Act includes up to five years in prison and a $250,000 fine. The maximum penalty for the firearms violations includes up to 10 years in prison and $250,000 fine.
The case was investigated by the U.S. Fish & Wildlife Service and the Colorado Division of Wildlife. The case is being prosecuted the U.S. Attorney’s Office for the District of Colorado and the Justice Department’s Environmental Crimes Section.
Jury Convicts Tax Shelter Promoters of Conspiracy, Tax CrimesRead the Press Release
WASHINGTON - Three tax shelter promoters, Peter J. Peggs of Prides Crossing, Mass., Robert D. Larsen of Winter Park, Colo., and Craig M. Stone, formerly of Fort Pierce, Fla., were convicted of conspiracy to defraud the United States by a federal jury in Grand Rapids, Mich., today following a four-week trial, the Justice Department and Internal Revenue Service (IRS) announced. In addition, the jury found Peggs and Larsen guilty of tax evasion.
In October 2007, Peggs, Larsen and Stone were indicted for a scheme to promote, market, sell and administer a fraudulent tax shelter. In March 2008, a superseding indictment was returned charging Anthony Merlo of New Hampshire, a business consultant and partner of Peggs and Larsen; John A. Campbell, a former partner in the Kalamazoo, Mich., office of the law firm of Miller, Canfield, Paddock & Stone P.L.C.; and Campbell’s client, Oskar René Poch of Hickory Corners, Mich., for their roles in the scheme. In April 2008, Campbell, who marketed the fraudulent insurance product; and Poch, who was the owner and operator of Trillium Staffing, an employee-leasing company in Kalamazoo, Mich., pleaded guilty to tax crimes. In May 2009, Merlo pleaded guilty for his role in the scheme.
According to evidence presented during trial, Peggs, Larsen and Stone conspired with Campbell, Merlo and others to defraud the United States by concealing facts and documents from the IRS in their promotion, marketing, sale and administration of sham "Loss of Income" insurance policies through an insurance company in the U.S. Virgin Islands known as Security Trust Insurance Company. The defendants sold these purported insurance policies to wealthy U.S. taxpayers as tax deductible products, with the understanding that the purchasers would have most of their premiums returned to them in a purportedly non-taxable manner. The clients then improperly took tax deductions for the purchase of this sham product and fraudulently reduced their taxable income. During the duration of the conspiracy, more than $12 million in premiums were collected by the promoters of the loss of income policies.
According to evidence presented during trial, Peggs, Larsen and Stone improperly disguised the return of over $3 million of Poch’s companies’ insurance premiums as funds available to Poch in the form of loans that he never repaid from a Michigan bank account in the name of an offshore foreign corporation which Poch paid the defendants to set up in the Bahamas. Moreover, Peggs, Larsen and Stone agreed in e-mails and other documents to conceal facts and documents from the IRS regarding this insurance tax shelter.
According to evidence presented during trial, Peggs and Larsen committed tax evasion by misleading the IRS during its audit of Poch’s tax returns for the years 1999 and 2000. Additionally, Peggs and Larsen lied to the IRS during its audit of Poch’s tax returns in 2002 and 2003. Peggs and Larsen also allegedly made material misrepresentations about the facts
underlying this scheme to Poch’s attorney who was preparing to contest the IRS audit determination in U.S. Tax Court against the IRS.
According to evidence presented during trial, Peggs and Larsen engaged in similar conduct with other clients and individuals in Massachusetts, Ohio and Kentucky. Another individual, Bruce M. Cohen of Louisville, Ky., was convicted in federal courts in both Ohio and Kentucky in connection with his participation in this conspiracy. Cohen, who testified during the trial, is currently serving a 37 month prison sentence for his conduct.
No sentencing date has yet been scheduled. Both the conspiracy and tax evasion convictions carry a maximum punishment of five years in prison and a fine of up to $250,000.
"The government will continue to unravel schemes promoted and used by taxpayers to evade their federal tax obligations," said John A. DiCicco, Acting Assistant Attorney General of the Justice Department’s Tax Division. "As this conviction demonstrates, those who attempt to hide behind fraudulent transactions and foreign corporations as part of their illegal tax schemes will be held accountable."
"Promoting the use of fraudulent loss of income documents for the purpose of taking false tax deductions isn't tax planning; it’s criminal activity," said Eileen Mayer, Chief, IRS Criminal Investigations. "We will continue to shut down fraudulent tax schemes and hold the promoters of these schemes accountable for their actions."
Acting Assistant Attorney General DiCicco commended the investigative efforts of the IRS agents involved in this case, as well as Justice Department Tax Division attorneys, Richard Rolwing, Patrick J. Murray, Jessica Nuzzelillo, who prosecuted the case. Acting Assistant Attorney General DiCicco also thanked the U.S. Attorney’s Office in Grand Rapids, Mich. for their assistance.
Additional information about the Justice Department's Tax Division and its enforcement efforts may be found at http://www.usdoj.gov/tax.
Indiana Home Health Agency Pays Nearly $2 Million<br /> to Settle False Claims Act AllegationsRead the Press Release
WASHINGTON – Omni Home Care, a home health care agency in Evansville, Ind., and its parent corporation, Omni Home Health, have agreed to pay the United States $1.97 million to settle claims that it violated the False Claims Act between 2006 and 2008, by failing to obtain certain required physician approvals before submitting bills for home health services to Medicare, the Justice Department announced today.
Under the Medicare program, a physician must sign plan of care forms for the initial home care, and must re-certify the plan at least every 60 days. In August 2008, Omni submitted a disclosure to the Office of Inspector General, Department of Health and Human Services, in which Omni stated that the required physician signatures were not timely obtained for certain services provided at its Evansville, Ind., facility. The settlement announced today resulted from the company’s disclosure.
"With the nation’s focus on health care, this settlement demonstrates the Justice Department’s commitment to ensuring that federal health care dollars are spent appropriately," said Tony West, Assistant Attorney General for the Civil Division. "It also serves as a reminder that those who come forward promptly, disclose their violations of the law and cooperate fully with the department will be dealt with fairly."
The case was handled by the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Southern District of Indiana and the Office of Inspector General of the Department of Health and Human Services.
19 October 2009
Maryland Scientist Charged with Attempted EspionageRead the Press Release
A Maryland scientist who once worked in varying capacities for the Department of Energy, the Department of Defense and the National Aeronautics and Space Administration has been arrested for attempted espionage, David Kris, Assistant Attorney General for National Security, Channing D. Phillips, Acting U.S. Attorney for the District of Columbia, and Joseph Persichini, Jr., Assistant Director for the FBI’s Washington Field Office, announced today.
A criminal complaint unsealed today in the District of Columbia charges Stewart David Nozette, 52, of Chevy Chase, Maryland, with attempted espionage for knowingly and willfully attempting to communicate, deliver, and transmit classified information relating to the national defense of the United States to an individual that Nozette believed to be an Israeli intelligence officer. The complaint does not allege that the government of Israel or anyone acting on its behalf committed any offense under U.S. laws in this case.
Nozette was arrested earlier today by FBI agents and is expected to make his initial appearance tomorrow in U.S. District Court for the District of Columbia. If convicted, he faces a maximum sentence of life in prison.
"The conduct alleged in this complaint is serious and should serve as a warning to anyone who would consider compromising our nation’s secrets for profit," said David Kris, Assistant Attorney General for National Security.
"Those who would put our nation’s defense secrets up for sale can expect to be vigorously prosecuted," said Channing D. Phillips, Acting U.S. Attorney for the District of Columbia. "This case reflects our firm resolve to hold accountable any individual who betrays the public trust by compromising our national security for his or her own personal gain."
"The FBI is committed to protecting the nation’s classified information and pursuing those who attempt to profit from its release or sale," said Joseph Persichini, Jr., Assistant Director for the FBI’s Washington Field Office.
According to an affidavit in support of the criminal complaint, Nozette received a Ph.D. in Planetary Sciences from MIT in 1983, and worked at the White House on the National Space Council, Executive Office of the President, in 1989 and 1990. He developed the Clementine bi-static radar experiment that purportedly discovered water on the south pole of the moon. Nozette also worked at the Department of Energy's Lawrence Livermore National Laboratory from approximately 1990 to 1999 where he designed highly advanced technology. At the Department of Energy, Nozette held a special security clearance equivalent to the Defense Department Top Secret and Critical Nuclear Weapon Design Information clearances. Department of Energy clearances apply to access to information specifically relating to atomic or nuclear-related materials.
Nozette was also the President, Treasurer and Director of the Alliance for Competitive Technology (ACT), a non-profit corporation that he organized in March 1990. Between January 2000 and February 2006, Nozette, through his company ACT, entered into several agreements to develop advanced technology for the U.S. government. Nozette performed some of this research and development at the U.S. Naval Research Laboratory in Washington, D.C., the Defense Advanced Research Projects Agency in Arlington, Virginia, and the National Aeronautics and Space Administration Goddard Space Flight Center in Greenbelt, Maryland. From 1989 through 2006, Nozette held security clearances as high as Top Secret and had regular, frequent access to classified information and documents related to the U.S. national defense.
According to the affidavit, on Sept. 3, 2009, Nozette was contacted via telephone by an individual purporting to be an Israeli intelligence officer, but who was in fact an undercover employee of the FBI (UCE). During that call, Nozette agreed to meet with the UCE later that day at a hotel in Washington D.C. According to the affidavit, Nozette met with the UCE that day and discussed his willingness to work for Israeli intelligence.
Nozette allegedly informed the UCE that he had, in the past, held top security clearances and had access to U.S. satellite information. Nozette also allegedly said that he would be willing to answer questions about this information in exchange for money. The UCE explained to Nozette that the Israeli intelligence agency, or "Mossad," would arrange for a communication system so that Nozette could pass information to the Mossad in a post office box. Nozette agreed to provide regular, continuing information to the UCE and asked for an Israeli passport
According to the affidavit, Nozette and the UCE met again on Sept. 4, 2009, in the same hotel. During the meeting, Nozette allegedly informed the UCE that, although he no longer had legal access to any classified information at a U.S. government facility, he could, nonetheless, recall the classified information to which he had been granted access, indicating that it was all still in his head. In the meeting, Nozette allegedly asked when he could expect to receive his first payment, specifying that he preferred to receive cash amounts "under ten thousand" so he didn’t have to report it. At the conclusion of this meeting, Nozette allegedly informed the UCE, "Well I should tell you my first need is that they should figure out how to pay me . . . they don't expect me to do this for free."
On or about Sept. 10, 2009, undercover FBI agents left a letter in the designated post office box for Nozette. In the letter, the FBI asked Nozette to answer a list of questions concerning U.S. satellite information. The undercover agents also provided a $2,000 cash payment for Nozette. The serial numbers of the bills were recorded. Nozette retrieved the questions and the money from the post office the same day.
On or about Sept. 16, 2009, Nozette was captured on videotape leaving a manila envelope in the designated post office box in the District of Columbia. The next day, FBI agents retrieved the sealed manila envelope that Nozette had dropped off and found, among other things, a one-page document containing answers to the questions posed by the undercover agents and an encrypted computer thumb drive. One of answers provided by Nozette contained information classified as Secret, which concerned capabilities of a prototype overhead collection system. In addition, Nozette allegedly offered to reveal additional classified information that directly concerned nuclear weaponry, military spacecraft or satellites, and other major weapons systems.
Also on or about Sept. 17, 2009, undercover FBI agents left a second letter in the post office box for Nozette. In the letter, the FBI asked Nozette to answer another list of questions concerning U.S. satellite information. The FBI also left a cash payment of $9,000 in the post office box. Nozette allegedly retrieved the questions and the money from the post office box later that same day.
On or about October 1, 2009, Nozette was filmed on videotape leaving a manila envelope in the post office box. Later that day, FBI agents retrieved the manila envelope left by Nozette and found a second set of answers from him. The answers contained information classified as both Top Secret and Secret that concerned U.S. satellites, early warning systems, means of defense or retaliation against large-scale attack, communications intelligence information, and major elements of defense strategy.
This investigation was conducted by the FBI’s Washington Field Office with assistance from the Naval Criminal Investigative Service and the Air Force Office of Special Investigations.
The prosecution is being handled by Trial Attorneys Deborah A. Curtis and Heather M. Schmidt, from the Counterespionage Section of the Justice Department’s National Security Division, and Assistant U.S. Attorney Anthony Asuncion, from the U.S. Attorney’s Office for the District of Columbia.
The public is reminded that a criminal complaint contains mere allegations and that every defendant is presumed innocent unless and until proven guilty.
Justice Department Reaches ADA Settlement with Fort Wayne, Indiana, Day Care Center Regarding Children with DiabetesRead the Press Release
WASHINGTON – Pine Hills Kiddie Garden of Fort Wayne, Ind., will take necessary steps to ensure that a child’s diabetes care is integrated into the usual routine of its day care center and programs as part of a settlement to resolve allegations that it discriminated on the basis of disability, the Justice Department announced today.
The settlement resolves a complaint filed by a parent of a six-year-old girl with Type I diabetes, alleging that Pine Hills refused in 2007 to permit the girl to participate in field trips as part of the summer program unless she was accompanied by a parent or a medically trained person hired by the parent. The complaint was filed under title III of the Americans with Disabilities Act (ADA).
"Parents of children with Type I diabetes deserve the comfort of knowing that their children will not be subjected to discrimination because of their illness. A day care center is required to evaluate and make reasonable modifications for children with diabetes," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "We commend Pine Hills Kiddie Garden for working cooperatively with the Department on today’s settlement, which will ensure equal opportunity for children with diabetes in the day care center."
Under the settlement, Pine Hills agrees to provide all children with diabetes with an equal opportunity to attend the center and to participate in all programs, services or activities. It will evaluate the application of each child with diabetes applying to attend the center, on a case by case basis, and will make reasonable modifications to permit children with diabetes to attend the center. Modifications include, but are not limited to, supervising and monitoring of children with diabetes while using blood tests, insulin pumps, syringes or other diabetes related equipment or while consuming of food while participating in a program. Pine Hills also agrees to pay $10,000 in compensatory damages and $10,000 in civil penalties.
Under the settlement, Pine Hills submits that it has made and continues to make a practice of many of the policies outlined in the agreement and that it incorporates additional policies suggested by the Justice Department.
People interested in finding out more about the ADA or the agreement can call the Justice Department's toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TTY) or access its ADA Web site at www.ada.gov.
Four Pharmaceutical Companies Pay $124 Million<br /> for Submission of False Claims to MedicaidRead the Press Release
WASHINGTON – Mylan Pharmaceuticals, UDL Laboratories, AstraZeneca Pharmaceuticals and Ortho McNeil Pharmaceutical have entered into settlement agreements for a total of $124 million to resolve claims that they violated the False Claims Act by failing to pay appropriate rebates to state Medicaid programs for drugs paid for by those programs, the Justice Department announced today.
The Medicaid Prescription Drug Rebate Program was enacted by Congress in 1990 out of concern for the costs the Medicaid was paying for outpatient drugs. By agreeing to participate in the Medicaid Rebate Program and signing these rebate agreements, the four companies agreed to pay quarterly rebates to Medicaid that were based upon the amount of money that health care program paid for each company’s drugs. The precise amount of a rebate is determined in part by whether a drug is considered an "innovator" drug or a "non-innovator" drug. The rebate that must be paid for innovator drugs is higher than the rebate for non-innovator drugs.
Each of the companies agreed to pay a settlement to resolve allegations that it had sold innovator drugs that were manufactured by other companies and had classified those drugs as non-innovator drugs for Medicaid rebate purposes. As a result of the improper classification of these drugs, the companies underpaid their rebate obligations under the Medicaid Rebate Program.
Mylan and UDL agreed to pay $118 million to resolve allegations that they underpaid their rebate obligations with respect to several Mylan drugs (nifedipine extended release tablets, flecainide acetate, selegiline HCL, Orphenadrine Citrate Aspirin and Caffeine tablets, Triamterene/Hydrochlorothiazide, Propoxyphene HCL, Propoxyphene HCL/Aspirin/Caffeine, Prophyxphene Napsylate/Acetaminophen, Ibuprofen tablets, Bumetanide, Cephalexin and Cefactor) and several UDL drugs (nifedipine extended release tablets, selegiline HCL, Triamterene & HCTZ, Propox Naps & APAP, Flecainide Acetate, Trihexyphenidyl, Ranitidine HCL syrup, Sucralfate Suspension, Selegiline HCL and Bumetanide). Because the Medicaid program is funded by both the federal and state governments, the federal government received $60,896,476.00, the states $49,824,389.00 of the settlement amount and $7,279,135.00 will be paid to entities that participated in the Public Health Service’s Drug Pricing Program.
Separately, AstraZeneca paid $2.6 million ($1.43 million to the federal government and $1.17 million to the states) to resolve allegations that it underpaid its rebate obligations with respect to Albuterol. Ortho McNeil paid $3.4 million ($1.87 million to the federal government and $1.53 million to the states) to resolve allegations that it underpaid its rebate obligations with respect to Dermatop.
"The Civil Division will continue to work with our state partners to ensure that Medicaid programs, which provide health care to more than 58 million Americans, receives the same discounts that any larger insurer gets," Tony West, Assistant Attorney General for the Civil Division, said. "These cases exemplify the strong cooperation between the Department of Justice and the states in protecting American taxpayers."
This case was brought under the False Claims Act, which allows for private persons to file suits on behalf of the government. The whistleblower, Ven-A-Care, a corporation located in Key West, Fla. will receive a total of $10,787,392 as its share of today’s recovery.
"These settlements are the culmination of several years of hard work on the part of the government’s investigators and attorneys," said John P. Kacavas, U.S. Attorney for the District of New Hampshire. " The settlement with Mylan and UDL is the largest health care fraud recovery that the U.S. Attorney’s Office in New Hampshire has ever obtained. The settlements show that the government is committed to identifying health care fraud and ensuring that companies that benefit from doing business with the government agree to play by the rules."
This case was handled by the U.S. Attorney’s Office for the District of New Hampshire and the Commercial Litigation Branch of the Justice Department’s Civil Division with assistance from the Medicaid Fraud section within the New Hampshire Attorney General’s Office, as well as the National Association of Medicaid Fraud Control Units. The case was investigated by members of the Office of Investigations of the Office of Inspector General of the U.S. Department of Health and Human Services.
Detroit-Area Physical Therapist Pleads Guilty <br /> in Medicare Fraud SchemeRead the Press Release
Solomon Nathaniel of Sterling Heights, Mich., pleaded guilty today in U.S. District Court in Detroit to participating in a conspiracy to defraud the Medicare program.
In his guilty plea today, Nathaniel, 51, a licensed physical therapist, admitted that he worked as a contract therapist for Suresh Chand, a co-conspirator who pleaded guilty to similar charges on Sept. 29, 2009. Chand owned and controlled several companies operating in the Detroit area that purported to provide physical and occupational therapy services to Medicare beneficiaries. Nathaniel admitted that he, Chand and others created fictitious therapy files appearing to document physical and occupational therapy services provided to Medicare beneficiaries, when in fact no such services had been provided. According to court documents, the fictitious services reflected in the files were billed to Medicare through sham Medicare providers controlled by Chand and other co-conspirators.
According to plea documents, Chand acknowledged that in order to create the fictitious therapy files, he and his co-conspirators paid cash kickbacks and other inducements to Medicare beneficiaries in exchange for the beneficiaries’ Medicare numbers and signatures on documents falsely indicating that they had received physical or occupational therapy. Nathaniel admitted that he was among the licensed physical or occupational therapists from whom Chand obtained signatures on fictitious "progress notes" and other documents falsely indicating that the therapists had provided services to the Medicare beneficiaries.
Nathaniel admitted that during the course of the scheme he signed approximately 1,250 fictitious physical therapy files indicating that he had provided physical therapy services to Medicare beneficiaries, when in fact he had not. Nathanial also admitted that between approximately December 2003 and July 2006, he falsified physical therapy files that supported claims to the Medicare program totaling approximately $6,250,000. Medicare actually paid approximately $2,875,000 on those claims. Nathaniel acknowledged that during his participation in the scheme, he was aware that Medicare was being billed for services he falsely represented he had performed.
The case is being prosecuted by Trial Attorneys John K. Neal and Gejaa T. Gobena of the Criminal Division’s Fraud Section and by Special Assistant U.S. Attorney Thomas W. Beimers of the Eastern District of Michigan. The FBI and the HHS Office of Inspector General (HHS-OIG) conducted the investigation.
The case was brought as part of the Medicare Fraud Strike Force, supervised by Deputy Chief Kirk Ogrosky of the Criminal Division’s Fraud Section and U.S. Attorney Terrence Berg of the Eastern District of Michigan. Since their inception in March 2007, Strike Force operations in four districts have resulted in indictments of 310 individuals who collectively have falsely billed the Medicare program for more than $680 million. In addition, HHS’ Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.
BASF Corporation Agrees to Clean Air Act Upgrades to Protect Stratospheric OzoneRead the Press Release
WASHINGTON— BASF Corporation has agreed, under a Clean Air Act settlement filed today in federal court in Beaumont, Texas, to reduce the use of refrigerant chemicals that destroy the earth’s stratospheric ozone layer, the Justice Department and the U.S. Environmental Protection Agency (EPA) announced.
The company will spend more than an estimated $250,000 to retrofit one refrigeration unit that currently uses such chemicals, replacing them with environmentally-friendly alternatives, and will either retrofit or retire two other units. BASF will also pay a civil penalty of $384,200 to resolve alleged Clean Air Act violations.
Under the settlement, BASF will replace one industrial refrigeration unit at its facility in Beaumont, and will either retrofit or retire two others at that facility. All of those units currently use hydro-chlorofluorocarbons, known as "HCFCs," which destroy stratospheric, or "good" ozone. All replacement units will be able to use only non ozone-depleting refrigerants. BASF has already replaced or retired four other refrigeration units at BASF’s facilities in Livonia, Mich.; Greenville, Ohio; and South Brunswick, N.J., at a cost of over $200,000. Combined, the measures that the company is performing will remove approximately 4,760 pounds of harmful HCFCs from their operations.
"Today’s settlement demonstrates this administration’s commitment to achieve the benefits envisioned by the Clean Air Act," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "We are pleased that after violating important ozone protection requirements, BASF is now committed to a settlement that will bring the company into compliance with the Act’s requirements."
"Today’s settlement marks an important step in protecting the earth’s stratospheric ozone layer from the harmful effects on HCFCs," said EPA Acting Regional Administrator Lawrence E. Starfield. "EPA will continue to enforce against companies that violate the rules."
The settlement is the result of a complaint filed earlier today against BASF alleging that the company violated Clean Air Act regulations designed to protect ozone in the stratosphere by preventing excessive leaks of ozone-depleting refrigerants from industrial coolers at BASF’s plants located in Beaumont, Livonia, Mich., Greenville, Ohio, and South Brunswick and Washington, N.J.
BASF Corporation, headquartered in Florham, N.J., is the U.S. affiliate of BASF SE, Ludwigshafen, Germany. The company makes a wide variety of products, including chemicals, plastics, and agricultural products at the five plants included in the agreement.
The consent decree, lodged in the U.S. District Court for the Eastern District of Texas, is subject to a 30-day public comment period and approval by the federal court. A copy of the consent decree is available on the Justice Department Web site at http://www.usdoj.gov/enrd/open.html and on the EPA Web site at http://www.epa.gov/compliance/resources/cases/civil/caa/
Attorney General Announces Formal Medical Marijuana GuidelinesRead the Press Release
Attorney General Eric Holder today announced formal guidelines for federal prosecutors in states that have enacted laws authorizing the use of marijuana for medical purposes. The guidelines make clear that the focus of federal resources should not be on individuals whose actions are in compliance with existing state laws, while underscoring that the Department will continue to prosecute people whose claims of compliance with state and local law conceal operations inconsistent with the terms, conditions, or purposes of those laws.
"It will not be a priority to use federal resources to prosecute patients with serious illnesses or their caregivers who are complying with state laws on medical marijuana, but we will not tolerate drug traffickers who hide behind claims of compliance with state law to mask activities that are clearly illegal," Holder said. "This balanced policy formalizes a sensible approach that the Department has been following since January: effectively focus our resources on serious drug traffickers while taking into account state and local laws."
The guidelines set forth examples of conduct that would show when individuals are not in clear and unambiguous compliance with applicable state law and may indicate illegal drug trafficking activity of potential federal interest, including unlawful use of firearms, violence, sales to minors, money laundering, amounts of marijuana inconsistent with purported compliance with state or local law, marketing or excessive financial gains similarly inconsistent with state or local law, illegal possession or sale of other controlled substances, and ties to criminal enterprises.
Fourteen states have enacted laws in some form addressing the use of marijuana for medical purposes. A copy of the guidelines, in a memo from Deputy Attorney General David W. Ogden to United States Attorneys, can be found here: http://blogs.usdoj.gov/blog/archives/192
16 October 2009
Justice Department Files Lawsuit Against TK Properties LLC for Violating the Fair Housing ActRead the Press Release
WASHINGTON – The Justice Department announced this week that it has filed a lawsuit against TK Properties L.L.C., its officer, Scott Terveen, and two employees, Ann Wagner and Corey Anderson, for violating the Fair Housing Act by discriminating on the basis of race. The lawsuit, filed in the U.S. District Court of South Dakota, charges that the defendants engaged in a pattern or practice of discrimination by creating a hostile housing environment for one African- American family and two white families who were tenants at Lakeport Village Apartments in Sioux Falls, S.D.
"All Americans are guaranteed the right to live in their homes without fear of discrimination because of their race, and housing providers should know that the Department of Justice is committed to protecting that right," said the Assistant Attorney General for the Civil Rights Division, Thomas E. Perez. "We will continue to vigorously prosecute those who stand in the way of achieving the Fair Housing Act’s goal of allowing all people to live in communities that are free of racial hostility."
This lawsuit arose as a result of complaints filed with HUD by the three families. After an investigation, HUD found reasonable cause to believe that unlawful discrimination had occurred and referred the matter to the Justice Department.
"For HUD and the Department of Justice to combat housing discrimination, we need people to report it when they see it," said John Trasviña, U.S Department of Housing and Urban Development (HUD) Assistant Secretary for Fair Housing and Equal Opportunity. "That’s why it’s equally important that we enforce the law against anyone who attempts to intimidate those who report discrimination or who assists others trying to exercise their rights."
The suit seeks a court order declaring that defendants’ actions violate the Fair Housing Act, prohibiting future discrimination by the defendants, awarding monetary damages to all persons harmed by the defendants’ discriminatory practices and assessing a civil penalty to vindicate the public interest.
The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability or familial status. More information about the Civil Rights Division and the laws it enforces is available at http://www.usdoj.gov/crt. Individuals who believe that they may have been victims of housing discrimination can call the Housing Discrimination Tip Line (1-800-896-7743), email the Justice Department at [email protected], or contact HUD at 1-800-669-9777.
The complaint is an allegation of unlawful conduct. The allegations must still be proven in federal court.
Former GSA Chief of Staff David Safavian Sentenced <br /> for Obstruction of Justice and Making False StatementsRead the Press Release
Former General Services Administration (GSA) Chief of Staff David H. Safavian was sentenced today to one year in prison on charges of obstruction of justice and making false statements in connection with the investigation into the activities of former Washington lobbyist Jack Abramoff.
In addition to the prison term, Safavian was sentenced today to two years of supervised release by U.S. District Court Judge Paul L. Friedman of the District of Columbia.
Safavian was found guilty by a federal jury in June 2006 of obstruction of justice and making false statements, but the verdicts were later vacated by the Court of Appeals for the D.C. Circuit and remanded for a new trial. A federal jury once again convicted Safavian of one count of obstruction of justice and three counts of making false statements on Dec. 19, 2008.
The jury in the second trial heard evidence that while Safavian assisted Abramoff in connection with the lobbyist’s attempts to acquire GSA-controlled properties, Abramoff took him on a luxury golf trip to Scotland and to London. The jury found that over the span of three years, Safavian made false statements in an attempt to conceal the fact that around the time of the golf trip he aided Abramoff with business before the GSA. The false statements included statements made to a GSA ethics officer and a GSA Office of Inspector General (GSA-OIG) Special Agent as well as falsely certifying a financial disclosure form.
The jury heard evidence at trial that Safavian’s efforts to cover up the assistance he provided Abramoff continued after he left the GSA in November 2004 to become the Administrator for the Office of Federal Procurement Policy at the Office of Management and Budget. The jury found that in May 2005, Safavian made false statements to an FBI Special Agent investigating Abramoff’s lobbying activities. According to evidence introduced at trial, Safavian told the FBI agent that he was unable to assist Abramoff with GSA-related activities around the time of the golf trip because he was a new employee at GSA.
Abramoff pleaded guilty in January 2006 to charges of conspiracy, honest services mail fraud and tax evasion and was sentenced in September 2008 to four years in prison in addition to the 22 months he served prior to the sentencing date.
To date, 20 individuals, including lobbyists and public officials, have pleaded guilty, been convicted at trial, or are awaiting trial in connection with the ongoing investigation into the activities of Abramoff and his associates.
The case was prosecuted by Senior Litigation Counsel Nathaniel B. Edmonds and Trial Attorney Albert Stieglitz Jr. of the Criminal Division’s Fraud Section and Trial Attorney Justin V. Shur of the Criminal Division’s Public Integrity Section. The investigation of this case was led by the FBI with assistance from the GSA-OIG. The ongoing investigation of the Abramoff matter is being led by the FBI.
Federal Court Rules That Virginia Violated Voting Rights <br /> of Military and Overseas CitizensRead the Press Release
WASHINGTON – The Justice Department announced that a federal district court in Richmond, Va., ruled yesterday that Virginia violated the voting rights of American military personnel and other overseas citizens by failing to mail absentee ballots in sufficient time for them to be counted in the Nov. 4, 2008, general election.
Ruling in a 2008 lawsuit by the Justice Department, U.S. District Court Judge Richard L. Williams declared that Virginia’s failure to mail more than 2,000 absentee ballots at least 30 days prior to the election violated the Uniformed and Overseas Citizens Absentee Voting Act (UOCAVA), a federal law that guarantees military personnel and other citizens living abroad the right to vote by absentee ballot in federal elections.
Judge Williams wrote in his ruling: "The right to vote means a right to cast a ballot that will be counted." As a result, the court held that Virginia’s failure to mail absentee ballots to its military and overseas voters sufficiently in advance of the election "offended these voters’ prized right to vote in a federal election[.]"
To remedy this violation of federal law, the Court ordered the Commonwealth to count all otherwise proper ballots received by the Commonwealth within 30 days after the election. The case will remain open for a determination of what relief is needed to ensure that Virginia complies with UOCAVA in future federal elections.
"The men and women who bravely put their lives on the line to serve their nation deserve, at the very least, to know that their votes will be counted, and their voices will be heard," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "I am gratified the Court acted so decisively to uphold the right of those serving our country in uniform and other citizens living abroad to vote, and I applaud the attorneys and staff in the Voting Section for their hard work on this case to protect that right."
UOCAVA requires states to allow uniformed service members and overseas citizens to register to vote and to vote absentee for all elections for federal office. The Justice Department has brought numerous suits under UOCAVA to ensure that voters are not deprived of an opportunity to vote due to late mailing of absentee ballots by election officials.
More information about UOCAVA and other federal voting laws is available on the Department of Justice Web site at http://www.justice.gov/crt/voting/misc/activ_uoc.htm. Complaints about discriminatory voting practices may be reported to the Voting Section of the Civil Rights Division at 1-800-253-3931.
Federal Court Permanently Bars Utah Man<br /> from Promoting “Asset Protection” SchemeRead the Press Release
WASHINGTON - A federal judge in St. George, Utah, has permanently enjoined Kent Bickmore, the founder of a so-called asset-protection business, from helping customers file fraudulent liens and create hidden nominee bank accounts, the Justice Department announced today. Bickmore agreed to the injunction without admitting the government’s allegations.
The government’s complaint alleged that Bickmore of St. George, Utah, operated the now-defunct Asset Protection Plus Inc., which helped customers place sham liens on their property to deceive creditors, including the Internal Revenue Service. Bickmore and Asset Protection also allegedly helped customers hide their income and assets by holding their money in bank accounts under nominee names.
In the past decade, the Justice Department’s Tax Division has obtained more than 430 injunctions against tax fraud promoters and tax return preparers. Information about these cases is available on the Justice Department’s Web site, as is information about the Justice Department’s Tax Division.
15 October 2009
Ship Captain Sentenced to 10 Months Confinement for Obstruction, Environmental and Ship Safety ViolationsRead the Press Release
WASHINGTON – Panagiotis Lekkas, the captain of the cargo ship, M/V Theotokos, was sentenced today in federal court in New Orleans to 10 months confinement, the Justice Department announced. Lekkas pleaded guilty on July 15, 2009, to one count of obstruction of justice, one count of violating the Act to Prevent Pollution from Ships, and two counts of violating the Ports and Waterways Safety Act.
According to the sentence, Lekkas will serve the 10-month confinement as follows: six months in prison, followed by four months in a community confinement facility in Louisiana. Lekkas must also pay a fine of $4,000.
The sentence requires Lekkas to depart the United States within 72 hours after release from community confinement and thereafter be banned from entering the U.S., U.S. ports, or being present upon a vessel that enters into the territorial waters of the United States for a term of three years. Lekkas acknowledged that even after the three year ban, his entry into the United States could be barred by the Department of State or the Department of Homeland Security based on those departments’ own objective criteria for exclusion or visa denial.
"This sentence including the three year ban from U.S. territorial water sends the message to ship crewmembers and captains that violating environmental and ship safety laws will have consequences. We are serious and we will continue to prosecute these cases and seek sentences that appropriately punish the crime," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.
"I want to extend my appreciation to the Environment and Natural Resources Division of the Department of Justice and the United States Coast Guard for their excellent work in this, as well as other environmental investigations," said Jim Letten, U.S Attorney for the Eastern District of Louisiana. "We will continue to work with our partners to punish and deter environmental abuses by violators. Clean water is vital to the New Orleans region and the citizens whose absolute right to a clean and healthful environment must not be threatened."
In a related matter, Polembros Shipping Ltd., Lekkas’ employer and the managing company of the Theotokos, pleaded guilty on Sept. 30, 2009, to violating two counts of the Act to Prevent Pollution from Ships, one count of violating the Nonindigenous Aquatic Nuisance Prevention and Control Act, one count of violating the Ports of Waterways Safety Act, and one false statements count. Polembros is scheduled to be sentenced on Dec. 9, 2009.
The case was investigated by the U.S. Coast Guard Investigative Service with assistance from inspectors from Sector New Orleans as well as legal assistance from U.S. Coast Guard in New Orleans and at headquarters in Washington, D.C. The case is being prosecuted by Christopher L. Hale of the Justice Department’s Environmental Crimes Section along with Dorothy Taylor of the U.S. Attorney’s Office in New Orleans.
Ohio Home Builder Charged with Filing False Tax ReturnsRead the Press Release
WASHINGTON - Roy W. Bradford of Ludlow Falls, Ohio, was indicted on two counts of filing a false tax return and one count of corruptly endeavoring to impede the Internal Revenue Service (IRS), the Justice Department and IRS announced today.
According to the indictment, Bradford, who owned and operated Bradford Builders which built wooden frames for residential construction, filed false tax returns for 2003 and 2004 that inflated his labor costs and understated his income. As a result, Bradford allegedly claimed less net profit and taxable income than he actually earned.
According to the indictment, Bradford corruptly endeavored to impede the IRS in several ways. Bradford filed Forms 1099 informational tax returns which inflated the amounts that he actually paid his workers. In addition, Bradford filed Forms 1099 which contained tax identification numbers for the workers that he knew were false. Bradford also sometimes paid the girlfriends or wives of his workers because of each worker’s immigration status and then filed false Forms 1099 stating that the girlfriends or wives worked for him. Additionally, during the civil audit and criminal investigation, Bradford provided documents and made statements to the IRS that he knew were false.
An indictment is merely a formal charge by the grand jury. The defendant is presumed innocent unless and until proven guilty in U.S. district court.
If convicted, Bradford faces a maximum sentence of nine years in prison and a $750,000 fine.
The case is being prosecuted by Justice Department Tax Division Trial Attorney Jerrod Patterson and Assistant U.S. Attorney Vipal Patel. The case was investigation by IRS-Criminal Investigation.
Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at http://www.usdoj.gov/tax.
MFG Chemical Agrees to Pay Civil Penaltyfor Toxic Explosion at Georgia PlantRead the Press Release
WASHINGTON—MFG Chemical Inc. has agreed to pay $270,000 in civil penalties to resolve claims resulting from a toxic release on April 12, 2004 of extremely hazardous chemicals at the company’s Dalton, Ga., plant, the Justice Department announced today.
The toxic release resulted from a runaway reaction at the plant when MFG, upon its initial production run for triallyl cyanuarate, mixed allyl alcohol with other chemicals, leading to an extreme increase in temperature and causing an explosion that released toxic gases to the atmosphere.
As a result, the surrounding community within a half mile radius of the MFG plant was evacuated. Over 150 people, including several emergency responders, were treated for exposure at the local hospital. One-half mile of vegetation south of the MFG plant was also burned and much of the aquatic life was killed throughout several miles of surrounding creeks which were contaminated by the water sprayed on the toxic vapor cloud in an attempt to control the vapor release.
The complaint, filed today in U.S. District Court for the Northern District of Georgia, alleges that MFG failed to adhere to the Clean Air Act’s general duty of care provision. The general duty of care requirement obligates companies handling extremely hazardous substances to take preventative measures to identify the risks involved and to reduce the risks by providing layers of protection on their equipment such as high temperature alarms, automatic feed shut off mechanisms, adequate pressure relief systems and a vapor release recovery and containment system. The complaint alleges MFG failed to identify the risk of a runaway reaction through its failure to calculate the temperature/time profile and to have appropriate layers of protection in place prior to the incident.
MFG has implemented measures to address conditions at the plant contributing to the explosion and release, including halting the use of allyl alcohol and hiring an experienced safety engineer to oversee its compliance with its Clean Air Act obligations. MFG also paid for the clean up of surrounding contaminated creeks. The $270,000 reflects the civil penalty that the United States determined MFG has the financial ability to pay.
Copies of the stipulation of settlement are available on the Department of Justice Web site at: http://www.usdoj.gov/enrd/Consent_Decrees.html .