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30 July 2009
Justice Department Signs Agreement with Niagara Falls<br /> to Ensure Civic Access for People with DisabilitiesRead the Press Release
WASHINGTON – The Justice Department today announced an agreement with the city of Niagara Falls, N.Y., 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 to bring state and local governments into compliance with the Americans with Disabilities Act (ADA). This agreement is the 164th under Project Civic Access.
"Officials in Niagara Falls recognize that civic access is a civil right, and I applaud them for working to ensure that all citizens, including individuals with disabilities, can enjoy one of America’s most treasured and visited landmarks," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "This agreement helps mark the 19th anniversary of the Americans with Disabilities Act, and we are pleased to take this major step forward in our mission to improve accessibility nationwide."
Under the agreement announced today, the city of Niagara Falls will take several steps to improve access for persons with disabilities, including:
- Making physical modifications to facilities so that parking, routes into the buildings, entrances, public telephones, restrooms, service counters and drinking fountains are accessible to individuals with disabilities;
- Officially recognizing New York state’s telephone relay service, and training staff in using the city TTY relay service;
- Continuing to ensure that the 9-1-1 emergency service TTY calls are answered as quickly as other calls received, that such calls are monitored for timing and accuracy if other calls are monitored, and that employees are trained and practiced in using a TTY to make and receive calls;
- Ensuring that the city’s official Web site is accessible to persons with disabilities;
- Develop a method for ensuring that voters with disabilities have an equal opportunity to vote by providing accessible voter registration locations and polling places, and by training poll workers on the rights of persons with disabilities and the practical aspects of assuring those rights;
- Ensuring equal access to Niagara County’s emergency management programs and services for persons with disabilities, including preparation, notification, response and clean up; and
- Implementing a plan on accessibility of sidewalks and curb cuts throughout the city.
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, Justice Department investigators, attorneys and architects conduct on-site surveys of state and local government programs and facilities for the purpose of identifying 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 the city of Niagara Falls 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 Requires Divestiture in Sapa’s Acquisition of IndalexRead the Press Release
WASHINGTON — The Department of Justice announced today that it has reached a settlement that will require Sapa Holding AB and Indalex Holdings Finance Inc. to divest a North Carolina aluminum sheathing facility in order to proceed with Sapa’s proposed $150 million acquisition of Indalex. The Department said that the transaction, as originally proposed, would substantially lessen competition for the manufacture and sale of aluminum sheathing (coiled extruded aluminum tubing) used in the manufacture of high frequency coaxial cable in the United States, resulting in increased prices and reduced quality, service and innovation.
The Department said that the companies must divest either Sapa’s Catawba, N.C. aluminum sheathing manufacturing plant or Indalex’s aluminum sheathing facility at its Burlington, N.C., plant in order to proceed with the deal.
The Department’s Antitrust Division filed a civil antitrust lawsuit today in U.S. District Court in Washington, D.C., to block the proposed transaction. At the same time, the Department filed a proposed settlement that, if approved by the court, would resolve the lawsuit and the Department’s competitive concerns.
"The original proposed transaction threatened to deprive consumers of the benefits of competition," said Christine A. Varney, Assistant Attorney General in charge of the Department’s Antitrust Division. "Without the divestiture required by the Department, purchasers of aluminum sheathing in the United States likely would have faced higher prices and reduced quality and innovation."
According to the complaint, Sapa and Indalex are the only two manufacturers of aluminum sheathing in the United States. Indalex is currently involved in bankruptcy proceedings. Aluminum sheathing is used to make coaxial cables that are purchased by cable television companies in the United States and abroad for use in transmitting high frequency broadband signals to their subscribers. Aluminum sheathing is made to exacting specifications to provide protection for the components of the cables to prevent the loss of the transmission signal to subscribers.
Under the proposed settlement, in the event the companies are unable to sell either the Catawba, N.C. or Burlington, N.C. facility promptly to a viable purchaser acceptable to the Department, they must sell Indalex’s entire Burlington, N.C. extruded aluminum plant, which produces fabricated aluminum products, such as conduit and aluminum shapes, in addition to aluminum sheathing.
Sapa is a Swedish corporation with its principal place of business in Stockholm, Sweden. Sapa sells fabricated aluminum products throughout the world, including in the United States, where it is the largest aluminum extrusion fabricator. In 2008, its sales of the product were about $30.7 million. Sapa is owned by Orkla ASA, a Norwegian public limited company whose offices are located in Skøyen, Oslo in Norway. Orkla is a large, diversified international company with operations throughout the world.
Indalex is a Delaware corporation with its principal place of business in Lincolnshire, Ill. Indalex sells fabricated aluminum products in Canada and the United States. Indalex is the second largest aluminum extrusion fabricator in the United States. In 2008, its sales of the product were about $12 million.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Maribeth Petrizzi, 450 Fifth Street N.W., Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.
Justice Department Requires Divestiture in Sapa’s Acquisition of IndalexRead the Press Release
WASHINGTON — The Department of Justice announced today that it has reached a settlement that will require Sapa Holding AB and Indalex Holdings Finance Inc. to divest a North Carolina aluminum sheathing facility in order to proceed with Sapa’s proposed $150 million acquisition of Indalex. The Department said that the transaction, as originally proposed, would substantially lessen competition for the manufacture and sale of aluminum sheathing (coiled extruded aluminum tubing) used in the manufacture of high frequency coaxial cable in the United States, resulting in increased prices and reduced quality, service and innovation.
The Department said that the companies must divest either Sapa’s Catawba, N.C. aluminum sheathing manufacturing plant or Indalex’s aluminum sheathing facility at its Burlington, N.C., plant in order to proceed with the deal.
The Department’s Antitrust Division filed a civil antitrust lawsuit today in U.S. District Court in Washington, D.C., to block the proposed transaction. At the same time, the Department filed a proposed settlement that, if approved by the court, would resolve the lawsuit and the Department’s competitive concerns.
"The original proposed transaction threatened to deprive consumers of the benefits of competition," said Christine A. Varney, Assistant Attorney General in charge of the Department’s Antitrust Division. "Without the divestiture required by the Department, purchasers of aluminum sheathing in the United States likely would have faced higher prices and reduced quality and innovation."
According to the complaint, Sapa and Indalex are the only two manufacturers of aluminum sheathing in the United States. Indalex is currently involved in bankruptcy proceedings. Aluminum sheathing is used to make coaxial cables that are purchased by cable television companies in the United States and abroad for use in transmitting high frequency broadband signals to their subscribers. Aluminum sheathing is made to exacting specifications to provide protection for the components of the cables to prevent the loss of the transmission signal to subscribers.
Under the proposed settlement, in the event the companies are unable to sell either the Catawba, N.C. or Burlington, N.C. facility promptly to a viable purchaser acceptable to the Department, they must sell Indalex’s entire Burlington, N.C. extruded aluminum plant, which produces fabricated aluminum products, such as conduit and aluminum shapes, in addition to aluminum sheathing.
Sapa is a Swedish corporation with its principal place of business in Stockholm, Sweden. Sapa sells fabricated aluminum products throughout the world, including in the United States, where it is the largest aluminum extrusion fabricator. In 2008, its sales of the product were about $30.7 million. Sapa is owned by Orkla ASA, a Norwegian public limited company whose offices are located in Skøyen, Oslo in Norway. Orkla is a large, diversified international company with operations throughout the world.
Indalex is a Delaware corporation with its principal place of business in Lincolnshire, Ill. Indalex sells fabricated aluminum products in Canada and the United States. Indalex is the second largest aluminum extrusion fabricator in the United States. In 2008, its sales of the product were about $12 million.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Maribeth Petrizzi, 450 Fifth Street N.W., Suite 8700, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.
Helmerich & Payne Agrees to Pay $1 Million Penalty to Resolve Allegations <br /> of Foreign Bribery in South AmericaRead the Press Release
Helmerich & Payne Inc. (H&P) has entered into an agreement with the Department of Justice to resolve improper payments by H&P to government officials in Argentina and Venezuela in violation of the Foreign Corrupt Practices Act (FCPA).
H&P, a Delaware corporation, is headquartered in Tulsa, Okla., and is listed on the New York Stock Exchange. The company provides oil drilling rigs, equipment and personnel on a contract basis, primarily in the United States and South America, with subsidiaries in both Argentina and Venezuela.
As described in the agreement, H&P has acknowledged responsibility for the actions of its subsidiaries, employees and agents who made various improper payments to officials of the Argentine and Venezuelan customs services, both government agencies. These payments were made in order to import and export goods that were not within regulations, to import goods that could not lawfully be imported, and to evade higher duties and taxes on the goods.
The agreement requires that H&P pay a $1 million penalty, implement rigorous internal controls and cooperate fully with the Department. The agreement recognizes H&P’s voluntary disclosure and thorough self-investigation of the underlying conduct, the cooperation provided by the company to the Department, and the extensive remedial efforts undertaken by the company.
As a result of these mitigating factors, the Department has agreed not to prosecute H&P or its subsidiaries for the making of improper payments, provided that H&P satisfies its obligations under the agreement for a period of two years. Those obligations include ongoing cooperation, payment of the $1 million penalty and further remedial steps.
In a related matter, H&P reached a settlement today with the U.S. Securities and Exchange Commission under which it agreed to pay more than $375,000 in disgorgement of profits, including pre-judgment interest.
This case is being prosecuted by Trial Attorney Kathleen M. Hamann of the Criminal Division’s Fraud Section.
Fourteen Motorcycle Gang Leaders and Members Plead Guilty <br /> in Detroit to Violent Crime, Drug and Firearms ChargesRead the Press Release
Fourteen members of the Outlaws Motorcycle Club have pleaded guilty in Detroit to charges including violent crimes in aid of racketeering, illegal drug distribution and firearms violations.
The guilty pleas included leaders, members and gang associates of Outlaws’ chapters in Fort Wayne, Ind., Indianapolis, and areas of Detroit including Eastside, Detroit Westside, Downriver and Bay City. The defendants were charged with various crimes including violent crimes in aid of racketeering; conspiracy to commit violent crimes in aid of racketeering; distribution and possession with intent to distribute cocaine, methamphetamine, marijuana and hashish; possessing a firearm after conviction for a felony; and sale of a firearm to a known felon.
"Unfortunately, far too many Americans live in fear of gang-related violence," said Assistant Attorney General Lanny A. Breuer. "By working with our federal, state and local partners to target these gangs, we take violent individuals off the street and weaken the chokehold that gangs like the Outlaws have on our communities."
"The guilty pleas by a large number of leaders and members of this illegal motorcycle gang are a good example of the success that comes from effective federal, state and local law enforcement cooperation," said U.S. Attorney Terrence Berg. "This case has managed to put a damper on the heightened dangers of violence and other criminal acts posed by organized gangs such as the Outlaws. The ATF, FBI and their state and local law enforcement partners did an excellent job in bringing the down the illegal activities of the Outlaws in the Eastern District of Michigan."
"One of ATF’s primary missions is to make our communities safer from the criminal activity of violent gangs, such as the Outlaws. The magnitude of the pain, suffering and fear that violent gangs bring to our communities is immeasurable," said Thomas Brandon, Special Agent-in-Charge of the ATF Detroit Field Division. "ATF, along with our local, state and federal partners, remains committed to stemming the hold that violent gangs like the outlaws have on our neighborhoods."
The guilty pleas were the result of "Operation Broken Spoke," "Operation Detroit Mugger," and "Operation End Game," a five-year investigation by the ATF; the FBI; the National Drug Intelligence Center; Michigan State Police; the Detroit Police Department; the South Bend, Ind., Police Department; and the Fort Wayne Police Department.
The following Michigan and Indiana Outlaws members and associates pleaded guilty:
NAME
DATE OF PLEA
CHARGE
Leroy Frasier, aka "Leroy"
July 30, 2009
Conspiracy to commit assault with a dangerous weapon
David Dorris, aka "Hoggs"
July 27, 2009
Conspiracy to commit assault with a dangerous weapon
Ramon Rios, aka "Ramon"
July 23, 2009
Conspiracy to commit assault with a dangerous weapon
Norman Box Jr., aka "Stormin Norman"
June 23, 2009
Assault with a dangerous weapon
Michael Radke, aka "Mike"
June 23, 2009
Distribution of cocaine
Edward Gallagher, aka "Eddie"
June 23, 2009
Distribution of methamphetamine
Danny Neace, aka "Milky"
June 12, 2009
Assault with a dangerous weapon
Bruce Wendel, aka "Big Bruce"
June 12, 2009
Assault with a dangerous weapon
Kim Galaviz, aka "Moe"
June 12, 2009
Distribution of cocaine
William Thomas McCowan, aka "Tom the Bomb"
June 10, 2009
Possession of hashish
William Merfert, aka "Billy"
June 10, 2009
Felon in possession of firearms
William Elston, aka "Jason"
June 9, 2009
Assault with a deadly weapon resulting in serious bodily injury
Mark Guerra, aka "Skid Mark"
April 1, 2009
Distribution of marijuana
William Guinn, aka "Slick"
Aug. 25, 2008
Distribution of marijuana
Robert Castillo, aka "Big Rob" and "Mexican Rob," is currently awaiting trial on charges of distributing cocaine. Kenneth Creslaw, aka "KC," is charged with distributing marijuana and remains a fugitive.
The original 18-count indictment alleged that the Outlaws Motorcycle Club is an enterprise whose members allegedly committed, attempted to, and threatened to commit acts of violence to protect and expand the gang’s criminal operations. Several of the defendants were charged with allegedly assaulting various members of the rival Hells Angels Motorcycle Club, in some cases with dangerous weapons including a hammer, motorcycle parts and a cane. Several defendants allegedly trafficked in the sale of narcotics, including methamphetamine, marijuana, hashish and cocaine, while others were charged with various firearms offenses.
The Outlaws Motorcycle Club has been identified as an international criminal organization whose members and associates engage in acts of violence including murder, attempted murder, assault, robbery, kidnapping, narcotics sales and distribution, illegal firearms trafficking and gambling offenses. The Outlaws are a structured and hierarchical gang, divided into multiple regions in the United States. The Outlaws also have members worldwide, including Europe, Asia and Canada. The Outlaws have a long-standing violent history with the Hells Angels Motorcycle Club, including assaults/batteries, shootings and fatalities.
The Detroit Outlaws case was prosecuted by Assistant U.S. Attorneys Diane L. Marion and Julie Beck of the Eastern District of Michigan, as well as Trial Attorney Sam Nazzaro of the Criminal Division’s Gang Unit.
The law enforcement actions in Detroit are the result of the Justice Department’s ongoing anti-gang initiative and the joint strategic and priority targeting of violent street gangs by the ATF, FBI, the National Gang Targeting, Enforcement and Coordination Center (GangTECC), the National Gang Intelligence Center and state and local law enforcement. The Criminal Division’s Gang Unit, a specialized group of federal prosecutors charged with attacking the most significant regional, national and international gangs in the United States, works with fellow prosecutors around the country to disrupt and dismantle gang activity in communities. In addition, the Gang Unit works with domestic and foreign law enforcement agencies to construct effective and coordinated prevention and enforcement strategies.
Former Congressional Chief of Staff Sentenced <br /> for Honest Services Fraud ConspiracyRead the Press Release
A former chief of staff to a member of the U.S. House of Representatives was sentenced today by U.S. District Judge Henry H. Kennedy Jr. to three years of probation, including 170 days of home detention, and ordered to perform 100 hours of community service.
On Dec. 7, 2007, Russell James Caso Jr., 36, of Canton, Ga., pleaded guilty before Judge Kennedy in U.S. District Court for the District of Columbia to a one-count criminal information charging him with conspiracy to commit honest services wire fraud. According to court documents, Caso served as a chief of staff to the Representative from 2005 until 2007. Caso’s guilty plea stems from his relationship with a firm that, according to court documents, had a stated mission of helping American businesses operate in Russia and facilitating the flow of trade between the United States and Russia.
According to court documents, the firm sought to submit its proposals seeking federal funding for these efforts to various executive branch agencies. The firm’s general secretary met frequently with and sought official action from Caso, the Representative for whom he worked and the Representative’s staff, including their assistance in obtaining funding for the proposals.
Caso admitted that the firm’s general secretary paid his wife a total of $19,000. According to court documents, Caso’s wife received $1,500 to edit written drafts of the firm’s proposals. After being paid for editing the proposals, Caso’s wife received and deposited three more checks totaling $17,500 from the firm between May and August 2005. Caso admitted that he knew his wife did very little additional work beyond editing the proposals in return for this money.
According to court documents, Caso organized meetings in mid-2005 where he and others made presentations and argued to various executive branch agencies, including the Departments of State and Energy and the National Security Council, that the firm’s proposals should be federally funded.
As chief of staff, Caso was required to submit annual financial disclosure statements, listing the source of any income earned by his wife, among other things. On the disclosure statement for 2005, Caso admitted he intentionally failed to disclose that his wife received any payments from the firm even though he knew that he was required to do so. In pleading guilty, Caso admitted that one reason for this non-disclosure was that he knew that his wife’s financial relationship with the firm created a personal conflict of interest because the firm was seeking his help to obtain federal funding.
During the sentencing hearing, the Department of Justice asked the court to reduce Caso’s sentence based on his substantial cooperation in the government’s continuing investigation.
The case was prosecuted by Assistant U.S. Attorney Howard Sklamberg from the U.S. Attorney’s Office for the District of Columbia as well as Trial Attorneys Armando O. Bonilla of the Criminal Division’s Public Integrity Section and Gregory C.J. Lisa of the Criminal Division’s Organized Crime & Racketeering Section. The case was investigated by the FBI and the Internal Revenue Service.
29 July 2009
Medicare Fraud Strike Force Operations Lead to Charges Against 32 Doctors and Health Care Executives for More Than $16 Million in Alleged False Billing in HoustonRead the Press Release
WASHINGTON – Thirty-two people have been indicted for schemes to submit more than $16 million in false Medicare claims in the continuing operation of the Medicare Fraud Strike Force in Houston, Deputy Attorney General David W. Ogden and Deputy Secretary Bill Corr of the Department of Health and Human Services (HHS) announced today. 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.
While the indictments were returned by a grand jury in Houston, individuals were arrested today in Houston, New York, Boston and Louisiana. In addition, Strike Force agents executed 12 search warrants at health care businesses and homes across the Houston area.
The joint DOJ-HHS Medicare Fraud Strike Force is a multi-agency team of federal, state and local investigators designed to combat Medicare fraud through the use of Medicare data analysis techniques and an increased focus on community policing. The fourth phase was announced in May 2009, with agents from FBI, HHS Office of the Inspector General (HHS-OIG), the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU), the Drug Enforcement Administration (DEA), Office of Personnel Management, Office of the Inspector General (OPM-OIG) and the Office of the Inspector General at the Railroad Retirement Board (RRB-OIG).
"Our Medicare Strike Force is striking back against health care fraud in all its forms and wherever it occurs. We will stop fraud as its happening, using real-time data analysis of Medicare billing records," said Deputy Attorney General David W. Ogden. "Those who commit health care fraud will not be allowed to steal money from American taxpayers. Anyone operating or considering operating a health care fraud scheme around the country should take notice that they will be held accountable."
"When criminals rip off Medicare beneficiaries, we all pay the price. These false Medicare schemes and scams are costing the taxpayers millions of dollars, harming Medicare beneficiaries and driving up the cost of health care, but thanks to this new innovative partnership and the hard work of our staff on the ground, we are starting to fight back against fraud in a big way. The Administration’s HEAT initiative and our Strike Forces are making a big difference in a very short amount of time, returning millions back to the Medicare Trust in just a few months," said Bill Corr, Deputy Secretary of Health and Human Services and the top HHS official on the HEAT Team. "We are also working together across the federal government on important new innovations in the way we do business on the front end, to try and prevent crime like this from happening in the first place."
The Strike Force operations in Houston are another important step of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their joint efforts to reduce and prevent Medicare and Medicaid fraud through enhanced cooperation. The HEAT taskforce, co-chaired by Deputy Attorney Ogden and Deputy Secretary Corr, is made up of top-level law enforcement agents, prosecutors and staff from both Departments and their operating divisions. In the May 2009 announcement, Attorney General Eric Holder and Secretary Kathleen Sebelius announced the expansion of the Strike Force into Detroit and Houston to build upon existing partnerships between the agencies in a heightened effort to reduce fraud and recover taxpayer dollars.
Charges were unsealed today against 32 individuals who are accused of various Medicare fraud offenses, including conspiracy to defraud the Medicare program, and criminal false claims. The Strike Force operations in Houston have identified the primary fraud schemes as those related to false billing for "arthritis kits," power wheelchairs and enteral feeding supplies.
According to the indictments, the defendants charged today participated in schemes to submit claims to Medicare for products that were in fact medically unnecessary and oftentimes, never provided. In some cases, indictments allege that beneficiaries were deceased at the time they allegedly received the items. Collectively, the physicians, company owners and executives charged in the indictments are accused of conspiring to submit more than $16 million in false claims to the Medicare program.
"Americans deserve quality healthcare and have the right to expect that money expended on Medicare is not wasted," said U.S. Attorney Tim Johnson. "We will prosecute anyone who fraudulently obtains Medicare benefits at the expense of the truly needy."
"We will protect the Medicare program and its beneficiaries by stopping those who falsely bill for power wheelchairs, orthotic devices and other supplies that are not needed," said Daniel R. Levinson, Inspector General of the Department of Health & Human Services. "Today’s arrests demonstrate the significant impact of the new HEAT strike force on combating fraud and abuse in the Houston area."
"We will continue to work together to combat those who corrupt the system and wish to line their pockets with taxpayer dollars," said Special Agent in Charge Richard C. Powers, FBI Houston Field Office. "Healthcare fraud strikes at the heart of our health care system and our economy."
Texas Attorney General Greg Abbott added: "Today’s arrests reflect a concerted effort to crack down on those who defraud Texas taxpayers. We will continue working with our federal partners to uncover waste, fraud, and abuse in the Medicare and Medicaid systems."
Since the inception of Strike Force operations in March 2007 with phase one in South Florida, phase two in Los Angeles in May 2008, and phase three in Detroit in March 2009, the Strike Force has obtained indictments of more than 293 individuals and organizations that collectively have billed the Medicare program for more than $674 million. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
Each of the three Houston Strike Force teams is led by a federal prosecutor from the U.S. Attorney’s Office in Houston or the Criminal Division’s Fraud Section. Each team has an agent from the FBI, HHS-OIG and the Texas Attorney General’s MFCU. DEA, OPM-OIG and RRB-OIG also have agents on the teams.
The cases are being prosecuted by attorneys from the U.S. Attorney’s Office, including Assistant U.S. Attorney Jennifer Lowery and Special Assistant U.S. Attorney Justin Blan, on detail from HHS-OIG, as well as from the Criminal Division’s Fraud Section, including Assistant Chief John S. (Jay) Darden and Trial Attorneys Charles Reed, Katherine Houston, Anthony Burba and John Cunningham.
An indictment is merely an allegation, and defendants are presumed innocent until and unless proven guilty.
To learn more about the HEAT team, go to: www.hhs.gov/stopmedicarefraud
Federal Corrections Officer Convicted of Civil Rights Charges <br /> Related to Fatal AssaultRead the Press Release
A federal jury in Orlando, Fla, found Erin Sharma, a Bureau of Prisons corrections officer, guilty today on felony federal civil rights charges related to a fatal assault on an inmate in March 2005. Sharma was convicted on two charges, one count of conspiring to violate the federal civil rights of inmate Richard Delano, and a second count of violating Delano’s civil rights by arranging for another inmate to assault Delano. Each count carries a sentence of up to life imprisonment and a $250,000 fine. A sentencing hearing has been set for Oct. 26, 2009.
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 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. On March 4, 2005, the inmate assaulted Delano. Delano later died from the injuries he suffered during that assault.
"This prosecution and the jury’s verdict makes clear that no one is above the law and the Department of Justice is committed to vigorously enforcing the criminal civil rights laws that the vast majority of law enforcement officers work tirelessly to uphold and enforce," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "Indeed, it is appalling that a federal corrections officer would engage in a scheme that resulted in the fatal beating of an inmate that she was sworn to protect."
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 of the U.S. Department of Justice. Federal Bureau of Investigation Special Agent Jim Raby was the lead investigator on the case.
Arizona Man Pleads Guilty to Mailing Child PornographyRead the Press Release
WASHINGTON – Robert Restuch, 69, of Bullhead City, Ariz., pleaded guilty yesterday to one count of mailing child pornography, Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney for the District of Arizona Diane J. Humetewa announced.
As part of his plea agreement, Restuch admitted that he entered a U.S. Post Office in Bullhead City and mailed a package that contained more than 600 images of child pornography, including images depicting children less than 12 years old.
Sentencing has been set for Oct. 19, 2009. At sentencing, Restuch will face a mandatory minimum sentence of five years in prison and up to 20 years in prison, as well as the possibility of lifetime supervised release. He will also face a fine of up to $250,000.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case was prosecuted by Trial Attorney James Silver of CEOS, with assistance from Assistant U.S. Attorneys Vincent Q. Kirby, Sharon K. Sexton and Heather Nelson of the District of Arizona. The U.S. Postal Inspection Service conducted the investigation.
28 July 2009
Vice President Biden, Attorney General Holder Announce Recovery Act Funding <br /> to Support Law EnforcementRead the Press Release
Vice President Joe Biden and Attorney General Eric Holder today announced $1 billion in grants to fund the hiring and rehiring of law enforcement officers all across the country under the American Recovery and Reinvestment Act of 2009. The grants will be awarded to 1,046 law enforcement agencies from all 50 states and will provide 100 percent of the approved salary and benefits for 4,699 officers for three years. Police departments receiving the grants will then be required to retain the grant-funded positions for a fourth year. Associate Attorney General Tom Perrelli, Pennsylvania Governor Ed Rendell, New Jersey Governor Jon Corzine, Delaware Governor Jack Markell, Maryland Governor Martin O’Malley, Philadelphia Mayor Michael Nutter, Philadelphia Police Commissioner Charles Ramsey and law enforcement officers from mid-Atlantic states joined the Vice President and Attorney General at the event.
"A big part of the Recovery Act is about building communities – making them as strong as they can be, allowing every American family to live a better life than the one they are leading now," said Vice President Joe Biden. "And we can’t achieve the goal of stronger communities without supporting those who keep our streets safe."
The Recovery Act grants, which will be administered by the U.S. Department of Justice Office of Community Oriented Policing Services (COPS) through the federal agency’s COPS Hiring Recovery Program, provide much needed financial support to state, local and tribal governments, and will help the nation’s law enforcement agencies add and retain the manpower needed to fight crime more effectively through community policing. The Department of Justice received over 7,200 applications for more than 39,000 officer positions, representing a total of $8.3 billion in requested funding.
"These Recovery Act funds will pump much needed resources into communities through a program with a proven track record," said Attorney General Holder. "The tremendous demand for these grants is indicative of both the tough times our states, cities and tribes are facing, and the unyielding commitment by law enforcement to making our communities safer."
"Our sworn officers are the front line of defense against crime and disorder in our nation’s communities," said Philadelphia Police Commissioner Charles H. Ramsey. "These Recovery funds are essential in helping local law enforcement agencies fulfill their mission of making the places in which we all live and work as safe as possible."
The Recovery Act includes $4 billion in Department of Justice grant funding to enhance state, local, and tribal law enforcement efforts, including the hiring of new police officers, to combat violence against women, and to fight internet crimes against children. In addition to today’s COPS awards, to date the Department of Justice has awarded $1.7 billion through formula state and local Edward Byrne Memorial Justice Assistance Grants, $95 million through the Victims of Crime Act Formula Grant Program, $41.5 million for Internet Crimes Against Children initiatives, $127 million in Office on Violence Against Women Recovery Act funds and $8.6 million for assistance for law enforcement along the Southern Border and in high intensity drug trafficking areas.
For more information about the COPS grants, or to learn which law enforcement agencies received funding, please visit www.cops.usdoj.gov.
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Attorney General's Remarks
UBS Client Pleads Guilty to Filing False Tax Return, Hid $8 Million in Secret Swiss Bank AccountsRead the Press Release
WASHINGTON - Jeffrey P. Chernick, of Stanfordville, N.Y., pleaded guilty today to charges of filing a false tax return, the Justice Department and Internal Revenue Service (IRS) announced. Chernick, who owns a corporation which represents toy manufacturers in China and Hong Kong, appeared today before Judge James I. Cohn in Ft. Lauderdale, Fla., and accepted responsibility for concealing more than $8 million in Swiss bank accounts.
According to court documents and statements made in court, on or about Oct. 14, 2008, Chernick electronically filed a U.S. Individual Income Tax Return Form 1040 for tax year 2007, which failed to report that he had an interest in or a signature authority over a financial account at UBS AG, one of Switzerland’s largest bank. He also failed to report income earned on the UBS account. The UBS account was opened in the name of Simba International Ltd., a nominee Hong Kong corporation.
According to court documents, beginning in the mid-1970’s, the defendant set up a Hong Kong corporation and opened offshore bank accounts in order to conceal from the IRS commissions paid to the defendant for toy sales. In total, Chernick was the beneficial owner of approximately $8 million in offshore assets which were maintained in accounts in the name of nominee entities, including Simba, at UBS and other Swiss banks.
According to court documents, in 2000, UBS entered into an agreement to begin providing the IRS with certain information relating to accounts in which the beneficial owner was a U.S. citizen. Around the same time, one of Chernick’s Swiss bankers left UBS for a smaller, less known Swiss bank. This banker told Chernick he had left UBS, in part, because the smaller bank would not be subject to Washington’s scrutiny and could not be pressured by the U.S. government to disclose certain information to American authorities. Following this banker’s advice, Chernick agreed to invest some of his assets with the smaller Swiss bank.
According to court documents, from 2002 through 2008, Chernick discussed his offshore accounts with this former UBS banker and other Swiss financial service providers. These meetings took place in the United States at various locations, including hotels in New York City. During these meetings, Chernick, the Swiss bankers and Swiss financial service providers would discuss Chernick’s investments held in his offshore accounts, as well as the payment of fees for banking services rendered by Hong Kong and Swiss financial service providers. In July 2008, despite Chernick’s concerns about the ongoing investigation into the activities of UBS, a Swiss financial service provider convinced Chernick not to disclose his offshore accounts, not to file amended returns, and not to pay to the IRS any additional taxes that were due and owing.
According to court documents, in order to have access to the millions of dollars Chernick concealed offshore, he utilized credit cards linked to his offshore Swiss bank accounts which he used to make large purchases while traveling abroad. Additionally, with the assistance of Swiss bankers and other financial service providers, Chernick set up a sham $700,000 loan between Simba and a second Hong Kong entity in order to repatriate funds into the United States to purchase property adjacent to his home in New York.
"Americans who have concealed assets offshore have until September 23 to voluntarily come clean with the IRS and take advantage of the reduced penalties connected with the current offshore initiative," said John DiCicco, Acting Assistant Attorney General for the Tax Division. "Failure to come forward and to disclose offshore assets exposes these Americans to increased penalties and possible criminal prosecution."
Judge Cohn scheduled sentencing for Oct. 30, 2009. Chernick faces a maximum sentence of three years in prison.
"As the investigation into offshore tax evasion continues, the United States will continue to vigorously pursue new leads and evidence as they are uncovered," said Jeffrey H. Sloman, Acting U.S. Attorney for the Southern District of Florida. "Those who enable and commit tax evasion risk substantial monetary penalties and incarceration."
In February 2009, UBS entered into a deferred prosecution agreement in which the bank admitted helping U.S. taxpayers hide accounts from the IRS. As part of the agreement, UBS provided the U.S. government with the identities of, and account information for, certain U.S. customers of UBS’s cross-border business.
"This is an important victory for America’s taxpayers who play by the rules and have no tolerance for those who shirk their tax responsibilities. Today’s action is also part of a much larger and coordinated effort by the Administration to aggressively find and crack down on tax evaders hiding their wealth overseas. For those still hiding in this shadowy world, it is time to come in and get right with your government or face stiff criminal and financial penalties," said IRS Commissioner Doug Shulman.
In June 2009, UBS client Steven Michael Rubinstein, a Boca Raton accountant, pleaded guilty to filing a false tax return. In April 2009, another UBS client, Robert Moran, a Ft. Lauderdale yacht broker, pleaded guilty to filing a false tax return.
Acting Assistant Attorney General DiCicco and Acting U.S. Attorney Sloman commended the investigative efforts of the IRS agents involved in this case. The prosecution is being handled by Senior Litigation Counsel Kevin M. Downing and Trial Attorney Michael P. Ben’Ary of the Tax Division, and Assistant U.S. Attorney Jeffrey A. Neiman.
U.S. citizens who have an interest in, or signature or other authority over, a financial account in a foreign country with assets in excess of $10,000 are required to disclose the existence of such account on Schedule B, Part III of their individual income tax return. Additionally, United States citizens much file a Report of Foreign Bank and Financial Accounts, or F-Bar, with the United States Treasury, disclosing any financial account in a foreign country with assets in excess of $10,000 for which they have a financial interest in or signature authority, or other authority over.
More information about the Justice Department’s Tax Division and its enforcement efforts is available at http://www.usdoj.gov/tax/.
Texas Man Arrested and Charged in Child Pornography CaseRead the Press Release
WASHINGTON – Mark Edwin Cairnes, 51, of Jonestown, Texas, has been charged with advertising, receiving and possessing child pornography, Assistant Attorney General Lanny A. Breuer of the Criminal Division and Acting U.S. Attorney John E. Murphy for the Western District of Texas announced today.
A grand jury in the Western District of Texas returned the indictment against Cairnes on July 21, 2009, which was unsealed today after his arrest yesterday in Jonestown. Cairnes is charged with five counts of advertising child pornography, two counts of receiving child pornography and one count of possessing child pornography. If convicted, Cairnes faces a mandatory minimum of 15 years in prison and a maximum of 30 years in prison for each count of advertising child pornography; a mandatory minimum of five years in prison and a maximum of 20 years in prison for each count of receiving child pornography; and a maximum of 10 years in prison for possessing child pornography. He also faces the possibility of a lifetime term of supervised release, as well as a fine of up to $250,000. An indictment is merely a charge and defendants are presumed innocent until proven guilty.
Cairnes was identified through "Operation Joint Hammer" – the U.S. component of an ongoing global enforcement operation targeting transnational rings of child pornographers. The operation already has led to the arrest of more than 60 people in the United States involved in the trade of child pornography. Operation Joint Hammer was initiated through evidence developed by European law enforcement and shared with U.S. counterparts by Europol and Interpol. The European portion of this global enforcement effort, "Operation Koala," was launched after the discovery of a handful of people in Europe who were molesting children and producing photographs of that abuse for commercial gain. Further investigation unveiled a number of online child pornography rings. Law enforcement has determined that the customers of the Web site were located in nearly 30 countries around the world, including the United States.
The case is being prosecuted by Assistant U.S. Attorney Matthew B. Devlin of the Western District of Texas and Trial Attorney Alecia Riewerts Wolak of the Criminal Division’s Child Exploitation and Obscenity Section. The investigation is being handled by ICE.
Indictment
Justice Department Signs Agreement with the Village of Midlothian, Illinois, to Improve Civic Access for People with DisabilitiesRead the Press Release
WASHINGTON – The Justice Department today announced an agreement with the village of Midlothian, Ill., to improve access to 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 full compliance with the Americans with Disabilities Act (ADA). This agreement is the 162nd under Project Civic Access.
"Access to public programs and services is a basic civil right, and I commend the village of Midlothian for committing to improving access to its programs and facilities for all of its citizens," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "As a result of today’s agreement, individuals with disabilities will be able to participate more fully in the civic life of Midlothian and to enjoy the access to services that so many of us take for granted."
More than 16 percent of the people living in the village of Midlothian have disabilities and will benefit from the agreement, which outlines several key steps the village of Midlothian will take to improve access for persons with disabilities, including:
- Making physical modifications to its facilities so that parking, routes into the buildings, entrances, public telephones, restrooms, service counters and drinking fountains are accessible to persons with disabilities;
- Ensuring that the village’s official Web site is accessible to persons with disabilities;
- Ensuring that all appropriate village employees are trained and practiced in using the Illinois Relay Service to make and receive calls;
- Maintaining the village’s database that tracks and aids the village in prioritizing repairs needed to eliminate sidewalk barriers to accessibility; and
- Ensuring equal access to its emergency management program and services for persons with disabilities.
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 facilities and programs across the country, and work to identify ways to improve a community’s compliance with ADA requirements. Each Project Civic Access agreement outlines a plan with specific steps that a local government will take to improve access for individuals with disabilities, while also acknowledging the steps already taken.
People interested in finding out more about the ADA, today’s agreement with the village of Midlothian or the Department’s Project Civic Access initiative may access the ADA Web site at http://www.ada.gov or call the toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TTY).
Justice Department Signs Agreement with Gregg County, Texas, to Improve Civic Access for People with DisabilitiesRead the Press Release
WASHINGTON – The Justice Department today announced an agreement with Gregg County, Texas, to improve access for persons with disabilities to its programs, services, activities and facilities. The agreement was reached under the Department’s Project Civic Access initiative, which helps bring localities into full compliance with the Americans with Disabilities Act (ADA). This agreement is the 163rd entered into under Project Civic Access.
"Because of Gregg County’s willingness to work cooperatively toward this agreement, individuals with disabilities will now have greater access to those programs, services and facilities that so many of us take for granted," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "Civic access is a civil right, and I applaud county officials for their commitment to improving access."
The Department’s Agreement with Gregg County provides that the county will:
- Make physical modifications to specified facilities so that parking, routes into the buildings, entrances, public telephones, restrooms, 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 title II of the ADA and their applicability to the county’s programs, services and activities;
- Ensure that the county’s official Web site is accessible to persons with disabilities;
- Take steps to ensure that all appropriate employees are trained and practiced in using the Texas Relay Service to make and receive calls;
- Maintain the database that tracks and assists the county in prioritizing repairs necessary to eliminate barriers to accessibility in the county’s sidewalks;
- Develop a method for providing emergency management policies and procedures for persons with disabilities, including preparation, notification, response and clean up;
- Develop a method for providing information for interested persons with disabilities concerning the existence and location of the county’s accessible services, activities and programs;
- Install signs at any inaccessible entrance to a facility directing users to an accessible entrance or to information about other accessible facilities.
Project Civic Access was initiated to ensure that individuals with disabilities have an equal opportunity to participate in civic life in their communities. As part of the project, Department investigators, attorneys and architects conduct on-site surveys of state and local government facilities and programs to identify modifications needed for compliance with ADA requirements. The agreements are tailored for each community to address specific areas where access to a government’s programs or facilities can be improved.
People interested in finding out more about the ADA, today’s agreement with Gregg County or the Department’s Project Civic Access initiative may obtain this information on the ADA Web site at http://www.ada.gov or by calling the toll-free ADA Information Line at (800) 514-0301 or (800) 514-0383 (TDD).
Contracting Officer’s Niece Pleads Guilty to Obstructing Money Laundering Investigation Related to Bribe PaymentsRead the Press Release
WASHINGTON - The niece of a U.S. Army major pleaded guilty today for her role in a conspiracy to cover up her uncle’s role in accepting more than $9 million in bribes as a contracting officer in Kuwait, Assistant Attorney General Lanny A. Breuer of the Criminal Division and Assistant Attorney General Christine A. Varney of the Antitrust Division announced.
Nyree Pettaway, 37, of Houston, pleaded guilty in U.S. District Court for the Western District of Texas to one count of conspiring with her uncle, John C. Cockerham, Carolyn Blake (her aunt and Cockerham’s sister) and others, to obstruct the investigation of money laundering related to Cockerham’s receipt of bribes. Pettaway admitted that, as Cockerham learned that he was under investigation in late 2006, he solicited her assistance to create cover stories for the millions of dollars he had received and to return $3 million in cash to co-conspirators for safekeeping. Pettaway admitted she traveled to Kuwait, received the cash from Blake, and gave it to others to hold for Cockerham. Pettaway also admitted that she delivered fraudulent documents to contractors in Kuwait, attempting to make the bribe payments look to investigators like legitimate loans.
Pettaway faces up to five years in prison and a fine of $250,000. In addition, she agreed to pay $5 million in restitution to the United States.
Cockerham pleaded guilty in January 2008 to participating in the complex bribery and money-laundering scheme. According to court documents, he was responsible for awarding contracts for services to be delivered to troops in Iraq, including bottled water. In return for awarding illegal contracts, Cockerham admitted to receiving more than $9 million in bribe proceeds. Once Cockerham agreed to take money in exchange for awarding contracts, he admitted he directed the contractors to pay Blake, his wife Melissa Cockerham, and others in order to conceal the receipt of bribe payments.
Melissa Cockerham pleaded guilty in January 2008 to accepting more than $1 million on John Cockerham’s behalf, and admitted that she had stored the cash in safe deposit boxes at banks in Kuwait and Dubai.
Blake pleaded guilty in March 2009 to one count of money laundering conspiracy after accepting more than $3 million in bribe proceeds on behalf of John Cockerham. Blake admitted she had expected to keep 10 percent of the money she collected.
This case is being prosecuted by Trial Attorney Richard B. Evans of the Criminal Division’s Public Integrity Section, which is headed by Chief William M. Welch, II and Trial Attorneys Mark W. Pletcher and Emily W. Allen of the Antitrust Division’s National Criminal Enforcement Section, which is headed by Chief Lisa Phelan. The case is being investigated by the Army Criminal Investigations Division, the Defense Criminal Investigative Service, the FBI, the Internal Revenue Service, the Special Inspector General for Iraq Reconstruction, and the U.S. Immigration and Customs Enforcement at the Department of Homeland Security.
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.
Information
27 July 2009
Virginia Resident Pleads Guilty to Participating in Scheme <br /> to Steal Fuel from U.S. Army in IraqRead the Press Release
A Virginia man pleaded guilty today to participating in a scheme to steal fuel worth approximately $39.6 million from the U.S. Army in Iraq.
Michel Jamil, 59, of Annandale, Va., pleaded guilty today in U.S. District Court in Alexandria, Va., before Judge Claude Hilton. Jamil pleaded guilty to a one-count information charging him with conspiracy to steal government property.
In his guilty plea, Jamil admitted that in March 2007, he and two of his co-conspirators arranged for the creation of a false Memorandum for Record (MFR) authorizing individuals to draw fuel from the Victory Bulk Fuel Point (VBFP), Camp Liberty, Iraq, purportedly on behalf of a company serving as a contractor to the U.S. government. The VBFP, owned and operated by the United States, supplies aviation and diesel fuel to military units and U.S. government contractors operating in and around the Victory Base Complex. Jamil admitted that he and his co-conspirators used this false MFR and others to steal large quantities of fuel from the U.S. Army for subsequent sale on the Iraqi black market. Jamil admitted that he escorted the trucks to retrieve fuel from the VBFP using a false MFR on approximately 10 to 15 occasions. During Jamil’s participation in the scheme, he and his co-conspirators stole from the U.S. Army fuel worth approximately $39.6 million. As a result of the scheme, Jamil admitted he received between $75,000 and $87,500 in profits.
At sentencing, Jamil faces a maximum sentence of five years in prison and a fine of the greater of $250,000 or twice the value gained or lost. Sentencing is scheduled for Nov. 13, 2009.
In related cases, Lee William Dubois and Robert Young pleaded guilty to participating in the same scheme. In his guilty plea on Oct. 7, 2008, Dubois admitted that he obtained government-issued common access cards for the drivers and escorts of the trucks and also presented false documents to the VBFP authorizing his co-conspirators to draw fuel. Dubois admitted that he and his co-conspirators stole approximately 10 million gallons of fuel, and that he received at least $450,000 in personal profits from the subsequent sale of the fuel on the black market. Sentencing for Dubois is scheduled for Sept. 4, 2009.
Young, 56, a former captain in the U.S. Army, pleaded guilty on July 24, 2009. In his guilty plea, Young admitted that between October 2007 and May 2008, he and his co-conspirators used fraudulently-obtained documents to enter the VBFP and presented false fuel authorization forms to steal aviation and diesel fuel from the VBFP for subsequent sale on the black market. As a result of the scheme, Young received approximately $1 million in personal profits. Sentencing for Young is scheduled for Oct. 30, 2009.
In another related case, a federal grand jury returned a superseding indictment on May 21, 2009, charging Robert Jeffery, 55, with conspiracy and theft of government property in connection with the same fuel theft scheme. The indictment alleges that Jeffery served as the lead escort for the fuel trucks for several months and illegally retrieved thousands of gallons of fuel from the VBFP. Young and Jeffery are both U.S. citizens who, until their arrests in connection with this case, resided in the Philippines. Jeffery’s trial is scheduled to begin on Aug. 10, 2009.
The case is being prosecuted by Special Assistant U.S. Attorney Steve Linick, Deputy Chief of the Criminal Division’s Fraud Section, and Fraud Section Trial Attorneys Andrew Gentin and Brigham Cannon. The investigation of this case was conducted by the U.S. Army Criminal Investigation Command, the Defense Criminal Investigative Service, the FBI and members of the National Procurement Fraud Task Force and the International Contract Corruption Task Force (ICCTF).
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. The ICCTF is a joint law enforcement agency task force that seeks to detect, investigate and dismantle corruption and contract fraud resulting from U.S. Overseas Contingency Operations, including in Afghanistan, Iraq and Kuwait.
Ship Operator Sentenced to Pay More Than $2 Million Fine for Concealing Pollution on the High SeasRead the Press Release
WASHINGTON—The operator of an ocean-going chemical tanker ship was sentenced today in federal court to pay a fine of more than $2 million for polluting the high seas, the Justice Department announced.
Consultores de Navegacion, a Spanish company that operates the M/T Nautilus, an ocean-going chemical tanker ship, was sentenced today by U.S. District Judge Douglas P. Woodlock to pay a fine of more than $2 million and serve three years of probation for criminal violations related to the overboard discharge of oil-contaminated bilge waste on the high seas.
The company pleaded guilty on April 6, 2009, to conspiracy, falsification of records, obstruction, and two violations of the Act to Prevent Pollution from Ships for failing to maintain an accurate oil record book. The practice of improperly handling and disposing of oil-contaminated waste from the tanker took place from at least June 2007 until March 2008. Along with the $2.08 million fine, the court ordered the company to implement comprehensive environmental compliance plan to prevent future violations.
Engine room operations on board large oceangoing vessels such as the M/T Nautilus generate large amounts of waste oil and oil-contaminated bilge waste. International and U.S. law prohibit the discharge of waste containing more than 15 parts per million of oil and without treatment by an oily water separator—a required pollution prevention device. Federal law also requires ships to accurately record each disposal of oil-contaminated bilge water in an oil record book and to have the oil record book available for inspection by the U.S. Coast Guard within the internal waters of the United States.
According to the government, between June 2007 and March 2008, senior engineers on the M/T Nautilus directed subordinate engine room crew members to use a metal pipe to bypass the ship’s oil water separator and instead to discharge oil-contaminated waste directly overboard. On two occasions in August 2007, Vadym Tumakov, a Ukranian who at that time served as chief engineer of the M/T Nautilus, directed the discharge of pollution overboard. In addition, in February 2008, Carmelo Oria, a Spanish citizen who served as chief engineer at that time, directed a discharge directly overboard from the ship’s bilge wells.
Oria, who was the chief engineer on the M/T Nautilus between January and March 2008 pleaded guilty to maintaining an oil record book that concealed the improper discharge of untreated waste directly from the ship’s bilges and was sentenced on May 6, 2009 to serve one month in prison. Vadym Tumakov, who was the chief engineer on the M/T Nautilus in August 2007 pleaded guilty to using falsified records that concealed improper discharges of oil-contaminated bilge waste from the ship and was sentenced on April 13, 2009 to serve one week in prison and a fine of $2,000.
The government’s investigation began in March 2008, when inspectors from the U.S. Coast Guard conducted an examination of the M/T Nautilus, following the ship’s arrival in St. Croix, U.S. Virgin Islands, and subsequently in the Port of Boston. The inspections uncovered evidence that crewmembers aboard the ship had improperly handled and disposed of the ship’s oil-contaminated bilge water and falsified entries in the ship’s official oil record book to conceal these activities.
"Today’s criminal fine is another warning to corporate entities and crewmembers that deliberately bypassing required environmental controls and pumping untreated bilge water directly into the ocean is illegal and violators will be punished," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "As long as individuals and maritime companies ignore this nation’s environmental laws, the Justice Department will continue to bring cases and seek justice for those involved."
"Today’s sentence should send a strong message to anyone in the maritime community who might consider circumventing our nation’s anti-pollution laws. Violating our nation’s environmental laws can actually cost more than legally disposing of the waste," said Acting U.S. Attorney Michael K. Loucks, for the District of Massachusetts.
"The Coast Guard remains committed to working with the maritime industry and federal, state and local law enforcement partners to protect the environmental resources of our nation," said Rear Admiral Joseph Nimmich, Commander of the First Coast Guard District in Boston. "Holding violators of the law responsible is critical to our enforcement effort. This case is a victory for the country and the environment."
The case was investigated by the U.S. Coast Guard, Coast Guard Investigative Service. It was prosecuted by Assistant U.S. Attorney Linda M. Ricci of the U.S. Attorney’s Economic Crimes Unit, Trial Attorney Todd Mikolop of the Justice Department’s Environmental Crimes Section, and Special Assistant U.S. Attorney Christopher Jones of the U.S. Coast Guard First District Legal Office.
Seven Charged with Terrorism Violations in North CarolinaRead the Press Release
Seven individuals have been charged with conspiring to provide material support to terrorists and conspiring to murder, kidnap, maim and injure persons abroad.
On Wednesday, July 22, 2009, a federal grand jury in the Eastern District of North Carolina returned a sealed seven-count indictment against the following defendants:
- Daniel Patrick Boyd, 39, a U.S. citizen and resident of North Carolina
- Hysen Sherifi, 24, a native of Kosovo and a U.S. legal permanent resident located in North Carolina
- Anes Subasic, 33, a naturalized U.S. citizen and resident of North Carolina
- Zakariya Boyd, 20, a U.S. citizen and resident of North Carolina
- Dylan Boyd, 22, a U.S. citizen and resident of North Carolina
- Mohammad Omar Aly Hassan, 22, a U.S. citizen and resident of North Carolina
- Ziyad Yaghi, 21, a U.S. citizen and resident of North Carolina
All the defendants are charged with conspiracy to provide material support to terrorists, as well as conspiracy to murder, kidnap, maim and injure persons abroad. In addition, Daniel Boyd, Hysen Sherifi and Zakariya Boyd are each charged with possession of a firearm in furtherance of a crime of violence. Daniel Boyd and Dylan Boyd are also each charged with selling a firearm to a convicted felon. Finally, Daniel Boyd is also charged with receiving a firearm through interstate commerce and two counts of making false statements in a terrorism investigation.
The defendants were arrested at various locations this morning by the FBI and other law enforcement agencies. They made their initial appearances today in federal court in Raleigh, N.C. At that time, the indictment was unsealed.
"The indictment alleges that Daniel Boyd is a veteran of terrorist training camps in Pakistan and Afghanistan who, over the past three years, has conspired with others in this country to recruit and help young men travel overseas in order to kill. Given the weapons allegedly involved in this conspiracy and the seriousness of the charges, the many agents, analysts and prosecutors who were able to bring about this case and safely remove these defendants from our streets deserve special thanks," said David Kris, Assistant Attorney General for the National Security Division.
"These charges hammer home the point that terrorists and their supporters are not confined to the remote regions of some far away land but can grow and fester right here at home. Terrorists and their supporters are relentless and constant in their efforts to hurt and kill innocent people across the globe. We must be equally relentless and constant in our efforts to stop them," said U.S. Attorney George E.B. Holding.
"The threat that extremists and radicals pose to America and our allies has not dulled or gone away. These arrests today show there are people living among us, in our communities in North Carolina and around the US, that are honing their skills to carry out acts of murder and mayhem. Their ultimate goal is to wage war on freedom and democracy. The FBI and our law enforcement partners are doing all we can to stop them from thriving and successfully attacking again," said Owen D. Harris, Special Agent in Charge of the Charlotte Division of the FBI. "We will remain vigilant, so must the public. If you see or hear something - act - call your local police department or the FBI. September 11th is not a vague memory for us, nor should it be for anyone."
"The cooperation between federal, state and local authorities throughout this investigation has been outstanding. It is only with our ongoing law enforcement partnership through the Joint Terrorism Task Force in conjunction with North Carolina’s fusion center, ISAAC, that we are able to ensure public safety from these terrorist threats," said North Carolina State Bureau of Investigation Director Robin P. Pendergraft.
The Conspiracy
According to the indictment, during the period from 1989 through 1992, Daniel Boyd traveled to Pakistan and Afghanistan where he received military-style training in terrorist training camps for the purpose of engaging in violent jihad. Following this training, he allegedly fought in Afghanistan.
From roughly November 2006 through at least July 2009, the indictment alleges that Daniel Boyd and the other defendants conspired to provide material support and resources to terrorists, including currency, training, transportation and personnel. The defendants also conspired to murder, kidnap, maim and injure persons abroad during this period. The object of the conspiracy, according to the indictment, was to advance violent jihad, including supporting and participating in terrorist activities abroad and committing acts of murder, kidnapping or maiming persons abroad.
The indictment alleges that, as part of the conspiracy, the defendants prepared themselves to engage in violent jihad and were willing to die as martyrs. They also allegedly offered training in weapons and financing, and helped arrange overseas travel and contacts so others could wage violent jihad overseas.
As part of the conspiracy, the indictment further alleges that the defendants raised money to support training efforts, disguised the destination of such monies from the donors, and obtained assault weapons to develop skills with the weapons. Some defendants also allegedly radicalized others to believe that violent jihad was a personal religious obligation.
Recruitment and Travels
Among other acts, the indictment alleges that Daniel Boyd traveled to Gaza in March 2006 and attempted to enter Palestine in order to introduce his son to individuals who also believed that violent jihad was a personal religious obligation. Later, in October 2006, defendant Ziyad Yaghi allegedly departed the United States for Jordan to engage in violent jihad.
In June 2007, Daniel Boyd and several other defendants departed the United States for Israel in an effort to engage in violent jihad, but ultimately returned to the United States after failing in their efforts. According to the indictment, after his return to the United States, Daniel Boyd made false statements twice to federal officials about who he had planned to meet on his trip to Israel.
In February 2008, Daniel Boyd allegedly solicited money to fund the travel of additional individuals overseas to engage in violent jihad and in March 2008, discussed with Anes Subasic preparations to send two individuals abroad for this purpose. He allegedly accepted $500 in cash from defendant Hysen Sherifi to be used to help fund jihad overseas and later showed Sherifi how to operate an AK-47 assault weapon.
In July 2008, Sharifi allegedly departed the United States for Kosovo to engage in violent jihad. According to the indictment, Sharifi later returned to North Carolina in April 2009, for the purpose of soliciting funds and personnel to support the mujihadeen.
Weapons and Training
The indictment also alleges that Daniel Boyd obtained a variety of weapons in furtherance of the conspiracy to murder persons overseas and provide material support to terrorists. These included a Bushmaster M4A3 rifle that Boyd allegedly received illegally via interstate commerce in 2006, as well as an ETA M16 V System C-MAG that he purchased in 2006. In 2007, he allegedly purchased a Ruger mini 14 long gun.
During 2008, the indictment alleges that Boyd purchased a Mossburg 100 ATR .270 rifle, a Llama Camanche III .357 revolver, a Century Arms AK Sporter 7.62 X 39 rifle and a Ruger mini 30 7.62 X 39 rifle. During 2009, Boyd allegedly purchased a Ishmash SAGA .308 rifle, a Century Arms Polish Tantal 5.45 X 39 rifle, a Century Arms C91 rifle .308, a Century Arms M70B1 7.62 X 34 rifle, a Ruger mini 14 5.56 rifle, and a Smith & Wesson MP15 .223 rifle.
The indictment further alleges that in February 2009, Daniel Boyd and his son, Dylan Boyd, knowingly sold a Beretta 9 mm handgun and ammunition to a convicted felon. In addition, the indictment alleges that in June 2009, Daniel Boyd and his son, Zakariya Boyd, used firearms in furtherance of a crime of violence, specifically conspiracy to murder.
Finally, the indictment alleges that Daniel Boyd and several of the defendants practiced military tactics and the use of weapons on private property in Caswell County, N.C., in June and July 2009.
Each of the defendants faces potential life imprisonment if convicted of conspiracy to murder, kidnap, maim and injure persons abroad. In addition, conspiracy to provide material support to terrorists carries a maximum 15 year sentence. The charges of receiving a firearm through interstate commerce and selling a firearm to a convicted felon each carry a maximum 10 year sentence. Making false statements in a terrorism investigation carries a maximum 8 year sentence, while possession of a firearm in furtherance of a crime of violence carries a consecutive 5 year sentence.
This investigation is being conducted by the Raleigh Joint Terrorism Task Force of the Charlotte Division of the FBI and NCISAAC, the North Carolina Information Sharing and Analysis Center.
The prosecution is being handled by Assistant U.S. Attorneys Barbara D. Kocher and Jason Cowley of the U.S. Attorney’s Office for the Eastern District of North Carolina, and Trial Attorney Jason Kellhofer, of the Counterterrorism Section in the Justice Department’s National Security Division.
The public is reminded that an indictment contains mere allegations. Defendants are presumed innocent unless and until proven guilty in a court of law.
Father and Son Commercial Fishermen Plead Guilty to Illegal Harvesting of RockfishRead the Press Release
WASHINGTON—A father and son pleaded guilty today in U.S. District Court in Greenbelt, Md., to illegally over fishing striped bass, also known as rockfish, from 2003 through 2006, the Justice Department announced.
Joseph Peter Nelson Jr., a commercial fisherman licensed in Maryland, pleaded guilty to four felony violations of the Lacey Act for participating in a scheme to illegally over harvest and under report the amount of rockfish he took from the Potomac River. His father, Joseph Peter Nelson Sr., also pleaded guilty to one felony violation of the Lacey Act for assisting in transporting the illegally taken rockfish in interstate commerce.
"This concerted law enforcement initiative has revealed extensive illegal activity related to harvesting and reporting of rockfish," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "The Justice Department is working with federal, state and local law enforcement agencies to investigate and prosecute these crimes to ensure a healthy, sustainable population of striped bass, up and down the eastern seaboard."
"The defendants knowingly violated the law and took steps to conceal their crimes," said Rod J. Rosenstein, U. S. Attorney for the District of Maryland.
According to the statement of facts filed with the court, from 2003 to 2006, Nelson Jr., with the assistance of his father, and a Maryland designated check-in station named Golden Eye Seafood, operated by Robert Lumpkins, inflated the number of fish recorded and under reported the weight. By inflating the number of fish caught and under reporting the weight, the records made it appear that Nelson Jr., had not reached the poundage quota for the year. He then requested more tags from the state of Maryland in order to catch more fish above his quota which were never reported by Golden Eye Seafood and were transported to other states for sale.
In addition, Nelson Jr. admitted to catching rockfish that were below the legal size limit in Maryland, and using tags that falsely indicated the method of catch. The tags indicated that he had caught the fish using hook and line when in fact they were caught using a net. Nelson admitted that he used a knife to simulate hook marks on the fish in order to avoid detection. On eight different occasions Nelson Jr. with the assistance of his father sold a total of over 2500 pounds of illegally harvested and tagged fish to an undercover agent posing as an out of state fish buyer. Nelson Jr. also admitted that he falsely and selectively tagged the rockfish in order to conceal where the fish had been caught in order to illegally maximize his catch.
According to the statement of facts, the total amount of rockfish over harvested by Nelson was approximately 14,500 pounds, in addition to the rockfish that was falsely tagged. The total market value of the Nelson’s over-harvest of rockfish was in excess of $72,000.
On June 11, 2009, Golden Eye Seafood and its owner, Robert Lumpkins of St. Mary’s County, Md., pleaded guilty to violating and conspiracy to violate the Lacey Act, by falsely recording the amount and weight of rockfish that were harvested by local fisherman and checked-in through Golden Eye from 2003 to 2007. Lumpkins and Golden Eye are set to be sentenced on Sept. 22 and 23, 2009.
A total of 14 individuals and two corporations have been convicted of illegally harvesting, purchasing and selling rockfish in Maryland, Virginia and Washington, D.C., as a result of this investigation. Eight individuals and one corporation have been sentenced, and 6 individuals and one corporation are awaiting sentencing.
Sentencing has been set for both Nelsons for Oct. 22, 2009 at 9:30 A.M in U.S. District Court in Greenbelt, Md.
The case is being prosecuted by Assistant U.S. Attorneys Stacy Dawson Belf and Christen Sproule for the District of Maryland and Senior Trial Attorney Wayne Hettenbach of the Justice Department’s Environmental Crimes Section.
24 July 2009
Used Motor Vehicle Dealers Indicted by Federal Grand Jury<br /> in Casper, Wyoming for Odometer TamperingRead the Press Release
WASHINGTON – A federal grand jury in Casper, Wyo., Thursday returned an indictment charging Randy Lee (a/k/a Jimmy Lee) and Jay Lee (a/k/a John Marks, a/k/a Anthony Romero) of Cheyenne, Wyo., with odometer tampering, title fraud, securities fraud, mail fraud and conspiracy to commit these offenses. The indictment alleges that the defendants worked as used car dealers at Lee’s RV’s, Inc., a dealership in Cheyenne. According to the indictment, as early as 2002, and through at least 2006, the defendants devised a scheme to defraud buyers of used motor vehicles by misrepresenting the mileage of vehicles they sold.
As part of the scheme, the indictment charges that the Lees purchased high-mileage, used motor vehicles from various businesses in New Mexico and Wyoming, as well as from a wholesale motor vehicle auction in Loveland, Colo. The defendants are charged with altering the odometers in these vehicles to reflect false, lower mileage. The Lees then fraudulently altered the motor vehicle titles and sales documentation associated with the these vehicles to reflect the false, lower mileage. As a result, the state of Wyoming issued motor vehicle titles reflecting this false, lower mileage, which the Lees knew to be untrue.
The defendants subsequently sold the motor vehicles to local consumers, other used motor vehicle dealers and at wholesale auto auctions, sometimes without stating that the false, lower mileages were inaccurate. As a result, the Lees received higher sales prices for the vehicles they sold, the indictment alleges.
"It is a crime for individuals who buy and sell used vehicles to change the odometers on the cars to increase their value," said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. "People who buy used vehicles need accurate mileage information to assess the value and safety of the vehicle. We take seriously our obligation to prosecute those who violate these statutes."
According to the indictment, some of the vehicles were sold with false, low mileage written on the title, but with a notice that the odometer reading was not accurate. The indictment adds that the defendants did not reveal the true mileage of the vehicle, which could be more than 100,000 miles more than what the title indicated.
"Car dealers who take miles off of vehicles cannot escape prosecution by checking a box on the back of the title," said Kelly H. Rankin, U.S. Attorney for the District of Wyoming. "That sort of practice leaves consumers in the dark about the real mileage of the vehicle. The purpose of the law is to provide accurate information, and the exception in the statute for vehicles with unknown mileage does not create a loophole for unscrupulous dealers who roll back odometers and conceal the true mileage."
The charges in the indictment are only allegations, and the defendants are presumed innocent unless and until proven guilty. If convicted, each defendant faces up to 20 years in prison on the most serious of the charges.
Assistant Attorney General West thanked the Wyoming Department of Transportation, the U.S. Department of Transportation, National Highway Traffic Safety Administration and the U.S. Attorney’s Office in Wyoming for their assistance in investigating and prosecuting this case.
Statement by Attorney General Eric Holder on the 19th Anniversary of the Americans with Disabilities ActRead the Press Release
“ The signing of the Americans with Disabilities Act (ADA) 19 years ago was a watershed moment for persons with disabilities and for all Americans concerned with the cause of equal justice. In the nearly two decades that have followed, the ADA has empowered Americans with disabilities to fully pursue the civic and economic opportunities to which they are entitled.
As steward of the ADA, the Department of Justice is committed to actively enforcing this critical civil rights law and will use all tools to seek compliance – including litigation if necessary – so that its promise of full equality for Americans with disabilities can finally be realized. We are full partners in President Obama’s designated “Year of Community Living” and will vigorously enforce the Supreme Court’s Olmstead decision to end unnecessary institutionalization.
It is fitting that the President will mark this anniversary by signing the Convention on the Rights of Persons with Disabilities, a treaty inspired by the ADA that will incorporate principles of empowerment and integration into international law. Just as America’s leadership 19 years ago inspired the world to join the cause, our renewed commitment to promoting and enforcing our laws today will continue to bring us closer to the goal of true equality for all.”
New Jersey Man Charged with Obscenity ViolationsRead the Press Release
A Jersey City, N.J., producer has been charged by a federal grand jury in Newark, N.J. with distributing obscene DVDs through the mails.
Barry Goldman, 58, was charged with eight counts of using the mails to deliver DVDs containing allegedly obscene films from Jersey City to addresses in Montana and Virginia. The indictment seeks forfeiture of the proceeds from the sale of the DVDs, along with property used in producing the DVDs, all web sites operated by Goldman and other property.
If convicted, Goldman faces a maximum penalty of five years in prison and a fine of $250,000 on each of the eight counts charged in the indictment.
An indictment is merely an accusation. All defendants are presumed innocent of the charges and it is the government’s burden to prove a defendant’s guilt beyond a reasonable doubt at trial.
The case is being prosecuted by Trial Attorney Bonnie Hannan of the Criminal Division’s Obscenity Prosecution Task Force.
Investigation of the case was conducted by the FBI’s Adult Obscenity Squad based in the Washington, D.C. Field Office.
Former Military Officer Pleads Guilty to Participating in Scheme to Steal Fuel Worth $39.6 Million from U.S. Army in IraqRead the Press Release
Robert Young, 56, a former captain in the U.S. Army, pleaded guilty today to participating in a scheme to steal fuel worth approximately $39.6 million from the U.S. Army in Iraq.
Young, a U.S. citizen who resided in the Philippines until his arrest in connection with this case, entered his guilty plea today in U.S. District Court in Alexandria, Va., before Judge Claude Hilton. Young pleaded guilty to both counts of a two-count superseding indictment filed on May 21, 2009, charging him and Robert Jeffery with conspiracy and theft of government property. Young’s sentencing is scheduled for Oct. 30, 2009.
In his plea, Young admitted that in October 2007, he and other co-conspirators agreed to participate in a scheme to steal fuel from the U.S. Army. Young also admitted that between October 2007 and May 2008, he and his co-conspirators, purportedly representing Department of Defense contractors in Iraq, used fraudulently-obtained documents to enter the Victory Bulk Fuel Point (VBFP) in Camp Liberty, Iraq, and presented false fuel authorization forms to steal aviation and diesel fuel from the VBFP for subsequent sale on the black market. The United States owns and operates the VBFP in support of Operation Iraqi Freedom. The VBFP supplies fuel to both military units and U.S. government contractors operating in and around the Victory Base Complex. To retrieve and transport the stolen fuel from the VBFP, Young admitted that he and his co-conspirators employed several individuals to serve as drivers and escorts of the trucks containing the stolen fuel.
During Young’s participation in the scheme, he and his co-conspirators stole from the U.S. Army fuel worth approximately $39.6 million. As a result of the scheme, Young received approximately $1 million in personal profits.
At sentencing, Young faces a maximum sentence of 15 years in prison and a fine of the greater of $250,000 or twice the value gained or lost.
In a related case, Lee William Dubois pleaded guilty on Oct. 7, 2008, to participating in the same scheme. In his plea, Dubois admitted that he obtained government-issued common access cards for the drivers and escorts of the trucks and also presented false documents to the VBFP authorizing his co-conspirators to draw fuel. Dubois admitted that he and his co-conspirators stole approximately 10 million gallons of fuel, and that Dubois received at least $450,000 in personal profits from the subsequent sale of the fuel on the black market. Sentencing for Dubois is scheduled for Sept. 4, 2009.
The superseding indictment filed on May 21, 2009, charges Robert Jeffery, 55, a former master chief petty officer in the U.S. Navy, with conspiracy and theft of government property in connection with the same fuel theft scheme. The indictment alleges that Jeffery served as the lead escort for the fuel trucks for several months and illegally retrieved thousands of gallons of fuel from the VBFP. Jeffery is a U.S. citizen who, until his arrest in connection with this case, resided in the Philippines. Jeffery’s trial is scheduled to begin Aug. 10, 2009.
The case is being prosecuted by Special Assistant U.S. Attorney Steve Linick, Deputy Chief of the Criminal Division’s Fraud Section, and Fraud Section Trial Attorneys Andrew Gentin and Brigham Cannon. The investigation of this case was conducted by the U.S. Army Criminal Investigation Command, the Defense Criminal Investigative Service, the FBI and members of the National Procurement Fraud Task Force and the International Contract Corruption Task Force (ICCTF).
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. The ICCTF is a joint law enforcement agency task force that seeks to detect, investigate and dismantle corruption and contract fraud resulting from U.S. Overseas Contingency Operations, including in Afghanistan, Iraq and Kuwait.
Statement of Facts
23 July 2009
Two Idaho Men Convicted for Federal Hate Crime AssaultRead the Press Release
WASHINGTON – Michael Bullard and Richard Armstrong were convicted yesterday by a jury in Boise, Idaho, on federal hate crime and conspiracy charges in connection with the racially-motivated assault of an African American man outside of a Wal-Mart store in July 2008, announced Loretta King, Acting Assistant Attorney General of the Civil Rights Division; Thomas E. Moss, U.S. Attorney for the District of Idaho; Timothy Fuhrman, Special Agent in Charge of the FBI’s Salt Lake City Field Office; and Bill Augsburger, Chief of the Nampa Police Department.
Bullard and Armstrong each face a maximum sentence of 20 years in prison. Sentencing is scheduled for Oct.19, 2009. A third defendant, James Whitewater, pleaded guilty before trial and testified against the other two defendants.
Evidence revealed that on July 4, 2008, three men using racial slurs ambushed, chased and beat a 24-year-old African American man as he walked out of a Wal-Mart store in Nampa, Idaho. Witnesses testified that Bullard, Armstrong and Whitewater all participated in the assault, while a fourth person, a girlfriend of one of the defendants, held their belongings and cheered them on. The girlfriend, Jennifer Hartpence, was initially charged as a co-defendant, but her case was dismissed before it reached the jury.
After four hours of deliberation, the jury convicted the two remaining defendants of conspiring to violate the federally-protected rights of the victim and of actually violating the victim’s protected rights by engaging in the racially-motivated assault.
"Driven by bigotry and prejudice, the defendants brutally assaulted a young man for no other reason than the color of his skin. Hate crimes have no place in America, and we are pleased that a jury of their peers has brought the defendants to justice," said Assistant Attorney General King. "The Civil Rights Division will continue to vigorously prosecute those who commit these heinous crimes to the full extent the law allows."
"These convictions mean that racial crimes will not be tolerated, not in this country, not on any day. Idaho, like most other parts of this nation, has had inglorious moments in its past when people endured oppression and criminal acts merely because of their skin color, race, national origin, gender or religion. We are long past that time," said U.S. Attorney Moss. "We thank the FBI and the Nampa Police Department for their outstanding work in bringing this case forward."
"One cannot help but note the irony of how these terrible acts occurred on the 4th of July," said Special Agent in Charge Fuhrman. "In this day and age, law enforcement will not tolerate hate crimes. The FBI is committed to investigating these incidents aggressively and without hesitation."
"The victim of these crimes was minding his own business, shopping in a store in our city open to the public – as all of us do, and have a right to do, every day. This man paid a high price, an example to all that we must protect our rights with courage and be vigilant in defending the rights of our fellow citizens," said Chief Augsburger.
This case was investigated by FBI Special Agent Dominic Venturi and Nampa Police Department Detective Jason Kimball. It was prosecuted by Assistant U.S. Attorney Wendy Olson and Civil Rights Division Trial Attorney Erin Aslan.
Two Cincinnati Dentists Charged with Conspiracy, Tax CrimesRead the Press Release
WASHINGTON - Bradley C. Brennecke, a resident of Pleasant Plain, Ohio, and Bruce A. Mrusek, a resident of Maineville, Ohio, appeared in federal court today before U.S. Magistrate Judge Timothy S. Hogan in Cincinnati on conspiracy and various tax charges, the Justice Department and Internal Revenue Service (IRS) announced. Mrusek and Brennecke, who are both dentists, were indicted yesterday by a federal grand jury and charged with tax evasion, conspiracy to defraud the IRS and passing fictitious instruments. Mrusek was also charged with filing false business tax returns.
According to the indictment, Brennecke, who operated Eastgate Dental Care Inc. in Cincinnati and Goshen Family Dentistry Ltd. in Goshen, Ohio, failed to pay taxes for 1998, 2002, 2003 and 2004. Additionally, the indictment alleges that Brennecke transferred title of his house to his wife to conceal it from the IRS, sent the government bogus documents that purported to pay his tax liabilities and filed false tax returns.
According to the indictment, Mrusek, who owned and operated Wilmington Dental Management Services in Wilmington, Ohio, evaded his 2002, 2003 and 2004 taxes by transferring his assets to his wife’s name, sending bogus documents to the IRS that purported to pay his tax liabilities, using a trust to pay personal expenses and filing false personal tax returns. Additionally, the indictment alleges that Mrusek filed false tax returns for Wilmington Dental Management Services by reporting deductions that the business did not incur.
According to the indictment, Brennecke and Mrusek conspired to defraud the IRS beginning around the time that the IRS began civil audits of each of them. Brennecke and Mrusek assisted each other in the mailing of various fraudulent documents to the IRS and U.S. Treasury Department. Brennecke assisted Mrusek in the transfer of assets out of Mrusek’s name. Additionally, Brennecke and Mrusek are charged with submitting fictitious obligations labeled "Secured Promissory Notes" to the U.S. Department of the Treasury as purported payment of their tax debts. Each of these documents purported to be in the amount of $4.8 billion.
An arraignment date has not yet been set. If convicted on all counts, Brennecke faces a maximum term of 75 years in prison and a maximum fine of $1.75 million. Mrusek, if convicted on all counts, faces a maximum term of 79 years in prison and a maximum fine of $2.25 million.
The case is being prosecuted by Tax Division trial attorneys Shawn T. Noud and Daren H. Firestone. The case was investigated by the IRS Criminal Investigation Division.
Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at http://www.usdoj.gov/tax.
Indiana Man Convicted of Transporting and Possessing Child PornographyRead the Press Release
WASHINGTON – William Travis Brown, 39, of Sellersburg, Ind., was convicted today by a federal jury in Indianapolis of transporting and possessing child pornography, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney for the Southern District of Indiana Timothy M. Morrison, and Indianapolis Immigration and Customs Enforcement (ICE) Resident Agent in Charge Daniel T. Dill.
Brown was charged on July 8, 2009, in an amended indictment with one count of transportation and one count of possession of child pornography. According to evidence presented during the four-day trial, investigators discovered more than one thousand images and videos depicting the sexual abuse of minors. The images and videos were obtained through searches on March 20, 2007, of Brown’s rented house in Georgetown, Ind., and the seizure of a computer and CDs. In addition, evidence introduced at trial revealed that Brown used different Internet technologies to chat and trade the images with others online. Brown was tried before U.S. District Court Chief Judge David F. Hamilton.
At sentencing, Brown faces a mandatory minimum sentence of five years in prison, a maximum lifetime term of supervised release and a fine up to $250,000. A sentencing date has not yet been scheduled.
The case against Brown is being prosecuted by Assistant U.S. Attorney Steven D. DeBrota of the Southern District of Indiana and Trial Attorney Bonnie L. Kane of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS). The case was investigated by ICE, Indiana State Police, CEOS’s High Tech Investigative Unit and the FBI.
Colorado Interstate Gas Agrees to Resolve Clean Air Act Violations in UtahRead the Press Release
WASHINGTON— Colorado Interstate Gas Company (CIG), the operator of the Natural Buttes Compressor Station located on the Uintah and Ouray Indian Reservation near Vernal, Utah, has agreed to pay more than $1 million and install environmental controls at its facility as part of a consent decree that resolves violations of the Clean Air Act, the Justice Department and U.S. Environmental Protection Agency (EPA) announced today.
Under the terms of the decree, CIG will pay a civil penalty and back fees totaling $1,020,000 and will fund for one year the operation of two ambient air monitoring stations on the Uintah and Ouray Reservations
According to a complaint filed along with the consent decree, CIG installed engines at its Natural Buttes Compressor Station but failed to obtain a permit and control and test emissions sources at its facility on the reservation. The violations of the Clean Air Act were discovered through EPA inspections and EPA-required emission testing at the facility.
"Protecting the environment on Indian lands is an important priority for the Justice Department," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "This is the fourth Clean Air Act case this year alone, brought by the Department against companies operating natural gas production facilities on the Uintah and Ouray Indian Reservation."
"This settlement will formalize Colorado Interstate Gas Company’s commitment to reduce emissions and support air monitoring on the Uintah and Ouray Indian Reservation." said Eddie A. Sierra, Acting Assistant Regional Administrator for EPA Region 8.
The settlement will result in operational improvements that are expected to reduce emissions of hazardous air pollutants by more than 48,000 pounds per year and nitrogen oxides by 313,000 pounds per year. In addition, the settlement will help ensure that the Tribal air shed, a part of the atmosphere that behaves in a coherent way with respect to the dispersion of emissions, is being properly protected.
The consent decree, lodged today in the U.S. District Court for the District of Utah, 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 Department of Justice Web site at http://www.usdoj.gov/enrd/Consent_Decrees.html.
22 July 2009
St. Louis Woman Sentenced to 20 Years in Prison on Federal Sex Trafficking ChargeRead the Press Release
WASHINGTON – A federal judge today sentenced Waquita Wallace to 20 years in prison and five years of supervised release for a federal civil rights charge of sex trafficking by force, fraud or coercion for compelling a young St. Louis woman to commit acts of prostitution, announced Acting Assistant Attorney General Loretta King for the Civil Rights Division and Acting U.S. Attorney Michael W. Reap for the Eastern District of Missouri.
U.S. District Court Judge Carol E. Jackson sentenced Wallace, who had previously pleaded guilty and is the last of three defendants in this case to be sentenced on sex trafficking related charges. April Chaney and Richard Harper were previously sentenced to 60 months and 27 months in prison respectively for their roles in this crime.
"Sex trafficking violates individuals’ basic human rights, stripping them of their dignity and freedom," Acting Assistant Attorney General King said. "The damage done to the victim in this case cannot be reversed, but I applaud the investigators and attorneys who brought these defendants to justice and it should send a message that we will continue to vigorously enforce our nation’s civil rights laws."
In announcing the plea, Acting Assistant Attorney General King, and Acting U.S. Attorney Reap commended the FBI and the St. Louis Metro Police Department for their work in this cooperative investigation and prosecution. Assistant U.S. Attorney Howard Marcus and Trial Attorney Jim Felte of the Civil Rights Division’s Human Trafficking Prosecution Unit prosecuted this case for the government.
East St. Louis Police Department Officer Indicted on Civil Rights and False Statement ChargesRead the Press Release
WASHINGTON – Antonio McWherter, a police officer in the East St. Louis, Ill., Police Department, was charged today in a two-count federal indictment stemming from a January 2006 incident in which the officer allegedly punched a handcuffed arrestee in the mouth, announced Loretta King, Acting Assistant Attorney General for the Civil Rights Division, and A. Courtney Cox, U.S. Attorney for the Southern District of Illinois. The indictment charges McWherter with a felony civil rights violation and with making false statements to the FBI.
The indictment alleges that on Jan. 30, 2006, officer McWerter assaulted an arrestee, identified in the indictment by the initials "D.C." by punching him in the mouth while he was handcuffed at the East St. Louis Police Department station. The indictment also alleges that the punch resulted in bodily injury to D.C. and that the officer lied to the FBI.
An indictment is a formal accusation of criminal conduct, not evidence of guilt, and the defendant is presumed innocent unless and until proven guilty.
If convicted, the defendant faces a maximum penalty of ten years in prison on the civil rights charge and five years on the false statement charge.
This case was investigated by the FBI and is being prosecuted by Civil Rights Division Trial Attorney Patricia Sumner, Special Litigation Counsel Jeffrey Blumberg and Assistant U.S. Attorney Angi Scott of the U.S. Attorney’s Office for the Southern District of Illinois.
21 July 2009
Western Energy Company Will Pay $12.2 Million to U.S. & Montana to Settle Coal Royalties DisputeRead the Press Release
WASHINGTON—Western Energy Company, the operator of the Rosebud Mine on federal coal leases outside of Billings, Mont., has paid the United States more than $12 million in mineral royalties and accrued interest as the result of a settlement agreement announced today by the Justice Department and Department of the Interior.
Under the agreement that was filed in U.S. District Court for the District of Columbia, Western Energy has agreed to pay $12,239,538 in additional royalties and interest, 49 percent of which will be shared with the state of Montana because the production occurred on federal lands in that state. As part of the settlement, Western Energy also agrees to report and pay future royalties in accordance with Interior Department requirements.
"We are very pleased that this issue has been resolved," Secretary of the Interior Ken Salazar said. "I appreciate the work of our Minerals Management Service and especially the Department of Justice to ensure the American public is receiving a fair return on the mineral resources developed on Federal lands."
"This agreement is an excellent result that recovers mineral royalties on behalf of the Mineral Management Service and avoids further expensive and complicated litigation," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.
The additional royalties collected are the result of improper transportation allowances originally claimed by the coal producer. An added benefit of the settlement is that a portion of the additional royalties includes amounts that Interior did not seek because of a policy not to order additional royalties on production occurring more than seven years earlier. That policy was rescinded in 2007 and inclusion of this portion of the additional royalties in the settlement spares further enforcement action to collect them.
The agreement is the result of litigation brought by Western Energy against the Interior Department disputing the amount of additional royalties due on coal produced from the Rosebud Mine in southern Montana.
New York State and New York City to Pay Record $540 Million to Settle Allegations of False Claims for Medicaid FundsRead the Press Release
WASHINGTON – The state of New York and New York City have agreed to pay $540 million to settle allegations that they knowingly submitted, or caused to be submitted, false claims for reimbursement for school-based health care services, primarily speech therapy and transportation, provided to Medicaid eligible children from 1990 to 2001, the Justice Department announced today. The settlement is a record federal recovery by the Justice Department for the Medicaid Program.
Medicaid, which is administered by the Centers for Medicare & Medicaid Services (CMS) inside the Department of Health and Human Services, is a matching program in which the United States shares the cost of medical services for the poor and disabled with the states. Since the early 1990's, the United States has paid New York State billions of dollars as the federal government’s share of health care costs for services provided to Medicaid-eligible school children under New York’s School Supportive Health Services Program and Preschool Supportive Health Services Program. These programs were developed jointly by New York’s education and health departments to assist local school districts, counties, and other schools in obtaining Medicaid reimbursement for covered diagnostic and health support services provided to students with disabilities.
The settlement resolves allegations that for the period 1990 to 2001, the state of New York knowingly failed to provide proper guidance to the districts and counties outlining the requirements for a service to be covered by the Medicaid program, failed to monitor the districts and counties for compliance as required by the program and passed on claims to the federal government for services it knew were not covered or properly documented, all to make the United States pay a larger share of New York’s Medicaid costs.
In addition, the settlement resolves allegations that New York City submitted claims to the state for false speech services. The state then passed these claims on to the federal government for Medicaid reimbursement.
The state of New York will pay $440 million over time, partly in cash and partly by releasing its claim to payments withheld. New York City’s share of the settlement, $100 million, will also be paid over time. The state of New York also entered into a three-year Program Compliance Agreement with CMS to ensure that services are properly delivered and billed in the future.
The government’s allegations arose from two lawsuits filed under the qui tam or whistleblower provisions of the False Claims Act, which allow private persons, known as "relators," to file actions on behalf of the United States and share in any recovery. The relator in these cases, a speech therapist who provided services to preschool children in upstate New York, alleged that New York State and its school districts submitted false claims for speech services that did not qualify for Medicaid reimbursement. The relator will receive $10 million from the settlement.
The lawsuits triggered a series of statewide audits by the Health and Human Services Office of the Inspector General (HHS OIG) and CMS. The Department of Justice’s Civil Division, in conjunction with the HHS OIG and CMS, handled the case.
Justice Department Files Lawsuit Alleging Racial Discrimination at Apartment Complex in Clanton, AlabamaRead the Press Release
WASHINGTON – The Justice Department today filed a lawsuit against the owner and employees of Rolling Oaks Apartments, a 72-unit complex in Clanton, Ala., for violating the Fair Housing Act by discriminating on the basis of race or color in the rental of apartments.
The lawsuit, filed in the U.S. District Court for the Middle District of Alabama, alleges that the employees, Kenneth R. Scott and Frankie L. Roberson, told white testers that a selling point of Rolling Oaks Apartments was the lack of African American tenants and that they had adopted rental policies intended to discourage African American rental applicants. The allegations are based on evidence generated by the Department’s Fair Housing Testing Program, in which individuals pose as renters to gather information about possible discriminatory practices. The complaint also names Chandi Biswas, the owner of the complex.
"When housing providers tell renters that they have a preference for a particular race or color, they are blatantly practicing housing discrimination and creating an intolerable condition for all," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Department will continue its vigorous enforcement of all the fair housing laws."
The suit seeks monetary damages for those harmed by the defendants’ actions, civil penalties and a court order barring future discrimination.
Individuals who may have information related to this lawsuit should contact the Justice Department toll-free at 1-800-896-7743, mail box number 6. Fighting illegal housing discrimination is a top priority of the Justice Department. The federal Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability. More information about the Civil Rights Division and the laws it enforces is available at http://www.usdoj.gov/crt.
The complaint is an allegation of unlawful conduct. The allegations must still be proven in federal court.
Former Wyoming Highway Patrol Trooper Pleads Guilty to Depriving Motorist of Civil Rights by KidnappingRead the Press Release
WASHINGTON – Franklin Joseph Ryle Jr., a former Wyoming Highway Patrol trooper, pleaded guilty on July 20, 2009, in federal court in Wyoming to depriving a man of his constitutional right to be free from unreasonable seizures by kidnapping him. Ryle also pleaded guilty to one count of using his firearm in relation to the crime.
While working on duty as a Wyoming Highway Patrol trooper on the night of Jan. 8, 2009, Ryle stopped a Wal-Mart truck with the intent to murder its driver and stage an accident with the truck that would either injure Ryle or kill his wife, allowing him to seek a monetary settlement from Wal-Mart.
Ryle stopped the driver on an isolated stretch of Interstate 25, a few miles southeast of Douglas, Wyo., and falsely told the driver that there was a warrant for his arrest, handcuffed him and placed him in the patrol car. Ryle drove away from the scene with the victim and unsuccessfully sought help from others for his scheme.
A sentencing hearing has not yet been scheduled.
The investigation was conducted by Wyoming Division of Criminal Investigation agents Mike Carlson and Darrin Cregger and FBI Special Agent Richard Fanelli. Civil Rights Division Trial Attorneys Edward Caspar and Christopher Lomax are prosecuting this case for the United States.
Detention Policy Task Force Issues Preliminary ReportRead the Press Release
The Department of Justice and Department of Defense today announced that the Detention Policy Task Force, which was created pursuant to Executive Order 13493, has issued a preliminary report on military commissions and a process for the determination of prosecution forum for trials of suspected terrorists. A copy of the report is attached. As authorized by the Executive Order, the Attorney General and Secretary of Defense have also decided to extend by six months the period in which the Task Force will conduct its work and submit a final report.
The Attorney General and Secretary of Defense serve as Co-Chairs of the Detention Policy Task Force and have been represented on the Task Force by their designees. Other Task Force participants include designees of the Secretary of State, Secretary of Homeland Security, the Director of National Intelligence, the Director of the Central Intelligence Agency, the Chairman of the Joint Chiefs of Staff, and the Director of the Federal Bureau of Investigation.
According to the Executive Order, the Task Force’s mission is "to conduct a comprehensive review of the lawful options available to the Federal Government with respect to the apprehension, detention, trial, transfer, release, or other disposition of individuals captured or apprehended in connection with armed conflicts and counterterrorism operations, and to identify such options as are consistent with the national security and foreign policy interests of the United States and the interests of justice." The Executive Order directs the Detention Policy Task Force to provide a report to the President within 180 days of the date of the Order, (by July 21, 2009), "unless the Co-Chairs determine that an extension is necessary."
Separately, the Department of Justice today announced that the Special Task Force on Interrogation and Transfer Policies, created pursuant to Executive Order 13491, will have an additional two months to submit its final report to the President. This Task Force is charged with evaluating whether the use of interrogation practices beyond those listed in the Army Field Manual by agencies other than the military provide an appropriate means of acquiring the intelligence necessary to protect the nation. It is also responsible for examining the transfer of individuals to other nations in order to ensure that such individuals are not tortured and that U.S. commitments to ensure the humane treatment of individuals in its custody or control are not undermined or circumvented.
The Detention Policy Task Force and the Special Task Force on Interrogation and Transfer Policies are distinct from the interagency Guantanamo Review Task Force, which was created pursuant to Executive Order 13492. The Guantanamo Review Task Force is conducting a review of the status of all individuals currently detained at Guantanamo Bay and is making recommendations regarding the proper disposition of each in order for the detention facilities at Guantanamo Bay to be closed within one year from the date of the Executive Order.
Related Materials:
Detention Policy Task Force Preliminary Report
Defendant Sentenced to Life in Prison for Participation<br /> in International Child Exploitation EnterpriseRead the Press Release
Warren Mumpower of Spokane, Wash., was sentenced to life in prison today for his activity in a global child pornography trafficking enterprise.
Mumpower, 65, was also ordered to pay a $25,000 fine by Senior U.S. District Judge Lacey A. Collier.
Mumpower, a convicted sex offender, was found guilty following a six-day trial in January 2009 of six counts relating to his criminal activities as a member of the child exploitation enterprise. The charges alleged in these counts included engaging in a child exploitation enterprise; conspiracy to advertise, transport, ship, receive and possess child pornography; advertising, transporting and receiving child pornography and obstruction of justice.
Six of the defendants in the case previously sentenced by Judge Collier also received sentences of life in prison, including: Daniel Castleman of Lubbock, Texas; James Freeman of Santa Rosa Beach, Fla.; Gary Lakey of Anderson, Ind.; Marvin Lambert of Indianapolis; Neville McGarity of Medina, Texas; and Ronald White of Burlington, N.C., also received life sentences. Five additional U.S. defendants also indicted in the case were sentenced on March 10, 2009, to terms in prison ranging from 164 months to 365 months.
According to evidence introduced at trial, the defendants were members of a highly sophisticated international network. The group was a well-organized criminal enterprise whose purpose was to proliferate child sex abuse images to its membership during a two-year period. The defendants were found guilty of participating in an illegal organization that used Internet newsgroups - large file-sharing networks where text, software, pictures and videos can be traded and shared - to traffic in illegal images and videos depicting prepubescent children, including toddlers, engaged in various sexual and sadistic acts. Specifically, an Australian constable who infiltrated the group in August 2006 testified at trial about how group members employed a complex system of pseudonyms, screening tests for new members and sophisticated encryption methods to avoid detection. He also testified that the group traded more than 400,000 images and 1,000 videos of child sexual abuse before it was dismantled by law enforcement.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The case is being prosecuted by Assistant U.S. Attorney David Goldberg of the Northern District of Florida and Trial Attorney LisaMarie Freitas of CEOS. The case is being investigated by the Innocent Images Unit of the FBI and the Queensland, Australia, Police Service, with the assistance of the Bundeskriminalamt (BKA) Child Pornography Unit in Germany and the Child Exploitation and Online Protection Centre in the United Kingdom.
20 July 2009
Justice Department Hosts Conference Celebrating the 45th Anniversary of Title VI of the Civil Rights Act of 1964Read the Press Release
WASHINGTON – The Justice Department’s Civil Rights Division held a conference today titled 2009 Title VI Conference: Celebrating the 45th Anniversary of the Legislation and Exploring Current Issues in Enforcement at the FDIC Conference Center in Arlington, Va. Approximately 400 representatives from federal, state and local agencies, community organizations and advocacy groups gathered to share new ideas and discuss trends in Title VI enforcement.
The conference commemorated the 45th anniversary of Title VI and emphasized the federal government’s reinvigorated commitment to enforcement of Title VI’s prohibition against discrimination on the basis of race, color or national origin in federally funded programs.
"Title VI is a vital tool in the struggle to end discrimination in our time. The Civil Rights Division and all of the federal agencies that provide federal financial assistance must be vigilant in enforcing its provisions in order to ensure that public funds are not used in programs that engage in discrimination," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division.
As part of the Department’s renewed commitment to civil rights enforcement, the Civil Rights Division issued new guidance to federal funding agencies concerning their Title VI obligations, "Strengthening of Enforcement of Title VI of the Civil Rights Act of 1964." The memorandum can be found online at www.usdoj.gov/crt/. In addition, the Civil Rights Division released an updated version of a video that serves as a training tool on the requirements of Title VI.
Conference speakers included Acting Assistant Attorney General King for the Civil Rights Division; Theodore Shaw, professor of the Columbia University School of Law and former director-counsel and president of the NAACP Legal Defense and Educational Fund; Dr. James Zogby, president of the Arab American Institute; and Russlynn Ali, Assistant Secretary for Civil Rights for the U.S. Department of Education.
Although in recent years, the Civil Rights Division has hosted several conferences focused on Title VI’s requirements concerning access for individuals who are limited English proficient, today’s conference on broader aspects of Title VI was the first of its kind in over 30 years.
To request a translation of this press release in Spanish, Chinese, Vietnamese or Korean, please contact: the Coordination and Review Section of the Department’s Civil Rights Division at (202) 307-2222 or (202) 307-2678 (TDD).
Department of Justice Announces Palmetto Project to Expand Training and Operations at the National Advocacy CenterRead the Press Release
Deputy Attorney General David W. Ogden today announced plans by the Department of Justice to significantly expand its training and education operations at the National Advocacy Center (NAC), the core training facility for local, state and federal attorneys, law enforcement agents and support personnel.
As part of the Palmetto Project – as it is known – the Department of Justice will lease approximately 326,000 square feet of space at the Close-Hipp Building adjacent to the NAC to enhance the training capabilities for the Department and consolidate operations and staff for the Executive Office of the United States Attorneys. The facility, located at the University of South Carolina (USC), will also house new state-of-the-art courtrooms, classrooms, and meeting space for seminars and large scale conferences.
"What we will build here will serve the cause of justice for generations to come," said Ogden, who made the announcement alongside Sen. Lindsey Graham (R-S.C.), university President Harris Pastides, Director of EOUSA H. Marshall Jarrett and U.S. Attorney for the District of South Carolina W. Walter Wilkins at a press conference at the NAC.
"This project was years in the making and took the work of many dedicated staff. The result will greatly enhance our existing presence at the NAC and will enable the University to relocate and expand its business school currently housed in the Close-Hipp building," Ogden said.
The move will bring more than 250 high-paying jobs to Columbia and provide an estimated cost savings of $42.8 million to the Department for the 20-year period of the lease.
Congress approved the relocation of several components and functions of EOUSA. The Department and USC will modify their existing Cooperative Agreement to proceed with the Project, which will take four years to complete.
"This agreement is the winning combination for both the Department of Justice and the University of South Carolina. It is a wise collaboration that will save the taxpayer money and benefit the university in the years to come," said Senator Graham. "I wish we saw more visionary collaborations like this one between the federal government and outside institutions."
University of South Carolina President Harris Pastides said the announcement represents a tremendous gain for the university and the community by allowing the university to move forward to build a new business school building.
"We are thrilled to announce our intent to build a new building. The teaching, learning and research, along with the Moore School's vast array of seminars and conferences that draw visitors from around the world, will help build the intellectual foundation of this school," Pastides said.
" The training and services we provide in this facility are critical to the day-to-day successes of our prosecutors in our nation’s courtrooms," said Jarrett. "The result of this expansion will be that our attorneys are better trained, more professional, and better equipped to fight crime and serve justice."
In addition to leasing the Close-Hipp building, the Department is expected to lease approximately 365 parking spaces from the university.
Monday’s announcement expands the relationship between the University of South Carolina and the Department that began nearly 15 years ago. In 1996, the Department announced plans to build the NAC on the university campus. That $26 million facility, which opened in 1998, has trained more than 170,000 federal and state personnel from around the country over the last dozen years and is named for former U.S. Sen. Ernest F. "Fritz" Hollings.
Alleged Mexican Cartel Leaders, Associates Targeted in Newest Effort to Combat Drug Trafficking OrganizationsRead the Press Release
Today the Departments of Justice, State and Treasury announced coordinated actions against the Gulf Cartel/Los Zetas drug trafficking organization, now known as the "Company," in the latest in a series of efforts by the U.S. government to neutralize and dismantle this violent cartel.
Antonio Ezequiel Cardenas-Guillen, Jorge Eduardo Costilla-Sanchez, Heriberto Lazcano-Lazcano and Miguel Trevino-Morales, high-level Mexican leaders of the Company and 15 of their top lieutenants, have been charged in U.S. federal courts with drug trafficking-related crimes. Also today, the State Department announced rewards of up to $50 million, collectively, for information leading to the capture of 10 of these defendants, including the four leaders who were also specially designated as Narcotics Kingpins today by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC).
"These indictments allege a stunning and sophisticated operation by the Company to move illegal drugs into our communities and cash back to Mexico," said Assistant Attorney General Lanny A. Breuer. "We have learned that the most effective way to disrupt and dismantle criminal organizations is to prosecute their leaders and seize their funding. Today’s coordinated actions by the Departments of Justice, State and Treasury will serve not only to bring these individuals to justice, but also to significantly slow the flow of cash that is so vital to cartel operations. These actions are also the result of our strong partnership with Mexican Attorney General Medina Mora, Secretary of Public Security Garcia Luna and other Mexican officials. We stand shoulder-to-shoulder with our brave Mexican colleagues in the fight against these destructive cartels."
"Violent drug trafficking organizations represent a threat to the health and safety of people in Mexico and the U.S.," said Acting Drug Enforcement Administration (DEA) Administrator Michele M. Leonhart. "These indictments and rewards prove our commitment to disrupting the cycle of drugs and associated violence that follow the cartels wherever they operate. I am especially proud of our DEA Houston and New York Divisions, whose investigations were the thrust behind the indictments of these offenders. With the help of the public, and in close coordination with the government of Mexico, they will be brought to justice."
"Following on the heels of the President’s naming of Los Zetas as a drug kingpin organization in April, we are today targeting sanctions against four drug lords who are senior leaders in Los Zetas and the Gulf Cartel," said OFAC Director Adam J. Szubin. "We remain committed to using all tools at our disposal to assist President Calderon in his courageous efforts against Mexico’s deadly narcotics cartels."
Today, an indictment was unsealed in the Eastern District of New York charging Miguel Trevino-Morales with operating a continuing criminal enterprise, international cocaine distribution and firearms violations. The indictment also contains a $1 billion forfeiture allegation. If convicted on all charges, he faces life in prison. Miguel Trevino-Morales is a principal leader of Los Zetas, originally a security force used by the Gulf Cartel. The Zetas, whose origin includes former members of the Air Mobile Special Forces Group of the Mexican military, have evolved into not only a security force but a drug trafficking organization in their own right.
In addition, a three-count superseding indictment returned June 9, 2009, in the District of Columbia charges the four leaders and 15 other alleged cartel members with conspiracy to possess with intent to import cocaine and marijuana into the United States and two counts of possession with intent to import cocaine into the United States. Cardenas-Guillen, Costilla-Sanchez and Lazcano-Lazcano are Organized Crime Drug Enforcement Task Force (OCDETF) Consolidated Priority Organization Targets (CPOTs). Conviction on any count carries a mandatory minimum sentence of 10 years and a maximum of life in prison.
According to the superseding indictment, the Company was led primarily by a governing council, or triumvirate, which consisted of Cardenas-Guillen, Costilla-Sanchez and Lazcano-Lazcano. The indictment alleges the Company has operated along the U.S./Mexico border, dividing the territory into areas known as "plazas" and assigning each plaza region a leader known as the "plaza boss." The superseding indictment alleges Cardenas-Guillen, Costilla-Sanchez and Lazcano-Lazcano directed the Company’s cocaine and marijuana shipments via boats, planes and cars from Colombia and Venezuela to Guatemala, as well as to various cities and "plazas" in Mexico. From Mexico, the drugs were then shipped into cities in Texas for distribution to other cities in the United States.
The Company allegedly used sophisticated record keeping programs to track shipping, employment, payroll and payments made to law enforcement officials as well as payments received and owed. The superseding indictment alleges that the defendants discussed, among other things, supply issues, debt collection, pricing for the drugs in specific areas, bonus structures for individuals working at the "plazas," concealment of the drugs during transportation, methods of shipment from Mexico to Texas, seizures of shipments and locations along the U.S./Mexico border where defendants allegedly believed the drugs could move more freely and control of law enforcement in certain areas.
Cardenas-Guillen, Costilla-Sanchez and Lazcano-Lazcano were previously charged with drug trafficking crimes in 2008 in two separate indictments returned in the District of Columbia cases. The other previously charged defendants, included in the superseding indictment, are Jaime Gonzales-Duran; Samuel Flores-Borrego; Mario Ramirez-Trevino; Alfredo Rangel-Buendia; FNU LNU, aka Lino; Gilberto Barragan-Balderas; Juan Reyes Mejia-Gonzales; Omar Trevino-Morales; Jesus Enrique Rejon Aguilar; Alfonso Lam-Liu; Eleazar Medina-Rojas; and Aurelio Cano-Flores. The superseding indictment also added the following defendants: Carlos Cerda-Gonzalez, Victor Hugo Lopez-Valdez and Sigifredo Najera-Talamantes.
Costilla-Sanchez is also charged, along with Osiel Cardenas-Guillen and eight others, in a 17-count superseding indictment filed in the Southern District of Texas in April 2002 with conspiracy to import and possess with intent to distribute cocaine and marijuana, conspiracy to launder drug money and threatening to assault a federal officer. A State Department reward of up to $5 million has previously been offered for information leading to the arrest of Costilla-Sanchez.
Ezequiel Cardenas-Guillen, along with 13 others, is also charged in a 10-count indictment filed in the Southern District of Texas in December 2002 with conspiracy to possess with intent to distribute cocaine, possession with intent to distribute cocaine and conspiracy to launder drug money. Ezequiel Cardenas-Guillen is alleged to have controlled a cocaine and money laundering organization in Matamoros, Mexico, with multiple cells in Houston that warehoused, transported and distributed multi-kilogram quantities of cocaine and laundered millions of dollars in drug proceeds that were smuggled into Mexico beginning in 1998.
Members of the Company on the DEA Most-Wanted List are also subjects of rewards, up to $5 million each, offered by the State Department through the Narcotics Rewards Program for information leading to these individuals’ arrest. They include:
Heriberto Lazcano-Lazcano
(AKA El Verdugo, El Lazca, Laz, Catorce and Licenciado)
Antonio Ezequiel Cardenas-Guillen
(AKA Ezequiel Cardenas-Guillen, Marcos Ledezma, Tony Tormenta and Licenciado)
Miguel Angel Trevino-Morales
(AKA 40, Cuarenta, L-40, David Estrada-Corado and Comandante Forty)
Alejandro Trevino-Morales
(AKA 42, Omar and Comandante Forty Two)
Juan Reyes Mejia-Gonzalez
(AKA R-1, Kike, Kiki, Quique)
Mario Ramirez-Trevino
(AKA Mario Armando Ramirez-Trevino, X-20, Mario Pelon and Pelon)
Gilberto Barragan-Balderas
(AKA Heriberto and Tocayo)
Jesus Enrique Rejon-Aguilar
(AKA Mamito, Caballero and David Enrique Cruz-Maldonado)
Samuel Flores-Borrego
(AKA Metro Tres, Tres, M Three, El Cabezon, Metro Three and Commander Tres)
Aurelio Cano-Flores
(AKA Yankee and Yeyo. Now in custody).
Since the inception of the Narcotics Rewards Program in the 1980s, the Department of State has paid more than $44 million in rewards to individuals whose information helped bring to justice many major violators of U.S. drug laws who were responsible for importing hundreds of tons of illegal narcotics into the United States each year. In addition, the Mexican Attorney General’s Office previously announced rewards of up to $2.4 million (30,000,000 pesos), per individual, for information leading to the capture of Costilla-Sanchez, Cardenas-Guillen, Lazcano-Lazcano and Miguel Trevino-Morales.
In support of the coordinated U.S. government effort against this organization, the U.S. Department of the Treasury’s OFAC today designated Costilla-Sanchez, Cardenas-Guillen, Lazcano-Lazcano and Miguel Trevino-Morales as Specially Designated Narcotics Traffickers through the Foreign Narcotics Kingpin Designation Act (Kingpin Act). Today’s designation action freezes any assets the individuals may have under U.S. jurisdiction and prohibits U.S. persons from conducting transactions or dealings in the property interests of the designated individuals and entities. Penalties for violations of the Kingpin Act range from civil penalties of up to $1,075,000 per violation to more severe criminal penalties. Criminal penalties for corporate officers may include up to 30 years in prison and fines up to $5 million. Criminal fines for corporations may reach $10 million. Other individuals face up to 10 years in prison and fines for criminal violations of the Kingpin Act. On April 15, 2009, the President designated Los Zetas as a Specially Designated Narcotics Trafficker Kingpin organization.
During the coordinated investigation that led to the superseding indictment in the District of Columbia being returned, foreign law enforcement seized substantial amounts of drugs belonging to this organization. Among the shipments intercepted was a 2,400 kilogram cocaine shipment intercepted and seized in Panama on Nov. 30, 2007. On Oct. 5, 2007, Mexican authorities seized an 11.7 ton load of cocaine, which was (at the time) the largest cocaine seizure in Mexican history. On Oct. 16, 2008, Mexican law enforcement agents seized more than 9,000 kilograms of marijuana belonging to the Company in Guadalupe, Mexico.
In September 2008, the Department announced the arrests of more than 175 alleged Gulf Cartel members and associates in Project Reckoning, a multi-agency international law enforcement effort that targeted key leadership elements of this organization. That effort is continuing through the coordinated multi-agency initiatives and developments announced today. To date, Project Reckoning has resulted in more than 620 arrests and the seizure of more than $84 million in U.S. currency, multiple tons of illegal drugs and 934 weapons.
The prosecution in New York is being handled by Assistant U.S. Attorneys from the Eastern District of New York. The case is being investigated by the New York offices of the DEA and U.S. Immigration and Customs Enforcement (ICE). The prosecution in the District of Columbia is being handled by trial attorneys from the Criminal Division’s Narcotic and Dangerous Drug Section (NDDS). The Criminal Division’s Office of International Affairs has provided significant assistance. The case is being investigated by the DEA Houston Office in coordination with the Special Operations Division, comprised of agents, analysts and attorneys from NDDS, DEA, FBI, ICE, ATF, U.S. Marshals Service and Internal Revenue Service.
An indictment is a formal charging document notifying the defendant of his charges. All persons charged in an indictment are presumed innocent until proven guilty.
For more information on the Most-Wanted list, please visit: www.dea.gov. For more information about the Narcotics Reward Program, please visit: www.state.govFor more information on Kingpin Act designations, please visit: http://www.treas.gov/offices/enforcement/ofac/programs/narco/narco.shtml
The DEA Houston Field Division has created an interagency Task Force, as part of the Houston Organized Crime Drug Enforcement Strike Force, whose primary responsibility is coordinating and focusing interagency efforts in a multifaceted attack on the cartel. The Task Force has established an e-mail address, [email protected], and toll-free phone line, 877-800-1323, for the reporting of information concerning the Company.
Indictment
Superseding Indictment
17 July 2009
Tampa Bay Doctor Agrees to Pay United States $1.7 Million to Resolve Medicare Fraud AllegationsRead the Press Release
WASHINGTON - Dr. Gabriel DeCandido, a physician practicing internal medicine in Largo, Fla., has agreed to pay the United States $1.7 million to settle allegations that he defrauded the Medicare program, the Department of Justice announced today.
In a complaint filed in the United States District Court for the Middle District of Florida, United States ex rel. Michael Flanery v. Dr. Gabriel DeCandido, et al., the United States alleged that Dr. DeCandido violated the False Claims Act by billing the Medicare program for higher levels of service than he actually rendered to patients and by billing for services not provided.
"Every year, billions of dollars are lost to Medicare and Medicaid fraud," said Tony West, Assistant Attorney of the Justice Department's Civil Division. "This case demonstrates our commitment to vigorously pursuing those who defraud Medicare. Taxpayer dollars should be spent on health care services for patients, not wasted on fraud and abuse."
The court found that the United States presented sufficient evidence showing that Dr. DeCandido attempted to hide and transfer his assets to avoid having to pay a judgment to the United States. To ensure that any judgment against Dr. DeCandido would be satisfied, the court permitted the government to seize five of his vehicles and garnish $976,000 that Dr. DeCandido transferred to his wife.
Today’s settlement also resolves allegations made by a relator, commonly known as a "whistleblower," under the False Claims Act, which allows a qualifying relator to receive a share of the settlement proceeds. The relator’s suit was filed in the United States District Court for the Middle District of Florida. The relator’s share of the recovery is $306,000.
As part of today's agreement, Dr. DeCandido entered into a Corporate Integrity Agreement (CIA) with the United States Department of Health and Human Services, Office of Inspector General, requiring him to engage in significant compliance efforts over the next five years. Among other provisions, the CIA requires Dr. DeCandido to engage independent review organizations to review the accuracy of the claims that he submits to the Medicare program.
Assistant Attorney West acknowledged the contributions made by both the Commercial Litigation Branch of the Civil Division and the Office of Counsel to the Inspector General for the Department of Health and Human Services in investigating and resolving this matter.
Prison Sentence for Cosco Busan pilotRead the Press Release
WASHINGTON— John Joseph Cota, the pilot who caused the Cosco Busan, a 900-foot long container ship, to collide with the San Francisco Bay Bridge and discharge approximately 53,000 gallons of oil into San Francisco Bay, was today sentenced to serve 10 months in federal prison by U.S. District Court Judge Susan Illston for the Northern District of California, the Justice Department announced.
Cota, who was a licensed bar pilot at the time of the collision, gave commands that caused the 65,131-ton Hong Kong-registered ship to collide with the bridge on Nov. 7, 2007.
Cota was sentenced according to an agreement in which he pleaded guilty to negligently causing discharge of a harmful quantity of oil in violation of the Clean Water Act (CWA), as amended by the Oil Spill Act of 1990 – a law passed in the wake of the 1989 Exxon Valdez disaster – and to violating the Migratory Bird Treaty Act, by causing the death of protected species of migratory birds.
In papers filed in court, prosecutors told the judge that Captain Cota should receive a sentence of incarceration because he was "guilty of far more than a mere slip-up or an otherwise innocuous mistake that yielded unforeseeably grave damage. Rather, he made a series of intentional and negligent acts and omissions, both before and leading up to the incident that produced a disaster that, as widespread as it was, could have had even worse consequences."
"Captain Cota abandoned ship by not following required safety procedures which then resulted in an environmental disaster" said John C. Cruden, Acting Assistant Attorney for the Justice Department’s Environment and Natural Resources Division.
"The court’s sentence of John Cota should serve as a deterrent to shipping companies and mariners who think violating the environmental laws that protect our nation’s waterways will go undetected or unpunished," saidJoseph P. Russoniello, U.S. Attorney for the Northern District of California. "They will be vigorously prosecuted."
Prosecutors provided the court with a list of Cota’s errors that included the following:
- Captain Cota left in extreme fog that was so thick that the bow of the vessel was not visible from the bridge. Captain Cota made the decision to leave in the fog while the pilots of six other large commercial vessels decided not to depart in the heavy fog which was less than 0.5 nautical miles.
- Having made the decision to leave port in impenetrable fog, Captain Cota took no action to assure the fortification of the bridge or bow watch or review the passage plan with the master and crew of the Cosco Busan. In particular, Cota failed to have a master-pilot exchange to review the transit plan.
- Captain Cota has subsequently claimed that he found both radar unreliable, but he did not notify the master or the Coast Guard that a required piece of equipment needed to safely navigate the ship had failed. Meanwhile, the captured images of the radar retained on the ship’s computer show that the radar was fully operational.
- The tape recorded conversations from the ship’s bridge show that Captain Cota was confused regarding the operation of the electronic chart system upon which he chose to rely including the meaning of 2 red triangles that marked buoys marking the tower of the bridge that he eventually hit.
- At no time during the voyage after leaving the berth at 8:07 a.m. and prior to 8:30 a.m. did Captain Cota, or any of the ship’s crew, consult the ship’s official paper navigational chart or take a single positional fix. Captain Cota did not ask any crew member to take any fixes or verify the ship’s position despite the lack of visibility. After the incident, Cota told the Coast Guard he did not request fixes because it is like "driving your car out of a driveway."
Prosecutors also filed papers showing that Captain Cota had failed to disclose his medical conditions and prescription drug use on required annual forms submitted to the Coast Guard.
The discharge of heavy fuel oil from the Cosco Busan fouled 26 miles of shoreline, killed more than 2,400 birds of about 50 species, temporarily closed a fishery on the bay, and delayed the start of the crab-fishing season. Monetary damages to the bridge, ship and private parties were in the tens of millions of dollars. Clean-up costs have been estimated to exceed $70 million. The birds killed include Brown Pelicans, Marbled Murrelets and Western Grebes. The Brown Pelican is a federally endangered species and the Marbled Murrelet is a federally threatened species and an endangered species under California law.
Cota was licensed by the Coast Guard and California as a Bar Pilot, according to the indictment. He was a member of the San Francisco Bar Pilots and had been employed in the San Francisco Bay since 1981. In California, large ocean-going vessels are required to be piloted when entering or leaving port.
The grand jury indictment also charges Fleet Management Limited (Hong Kong), a ship management firm, with the same alleged offenses as well as false statements and obstruction of justice charges. Trial in that case is set for Sept. 14, 2009. An indictment is merely an accusation. All defendants are presumed innocent until proven guilty at trial beyond a reasonable doubt.
The investigation has been conducted by the Coast Guard Investigative Service, the EPA Criminal Investigation Division, the Federal Bureau of Investigation, the U.S. Fish and Wildlife Service and the California Department of Fish and Game, Office of Spill Prevention and Response.
The case is being prosecuted by Assistant U.S. Attorneys Stacey Geis and Jonathan Schmidt and Special Assistant U.S. Attorney Christopher Tribolet of the U.S. Attorney’s Office for the Northern District of California, and Richard A. Udell, Senior Trial Attorney with the Environmental Crimes Section of the U.S. Department of Justice.
Under the Crime Victims’ Rights Act, crime victims are afforded certain statutory rights including the opportunity to attend all public hearings and provide input to the prosecution. Those adversely impacted by the oil spill are encouraged to visit http://www.usdoj.gov/usao/can/community/Notifications to learn more about the case and the Crime Victims’ Rights Act.
Los Angeles Jury Convicts Equipment Suppliers of Medicare FraudRead the Press Release
WASHINGTON – A federal jury in Los Angeles convicted the owners and operators of a Los Angeles-area durable medical equipment company of Medicare fraud, Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney for the Central District of California Thomas P. O’Brien; and Glenn R. Ferry, Special Agent-in-Charge for the Los Angeles Region of the Office of Inspector General for the Department of Health of Human Services announced today.
After a one-week trial in federal court in Los Angeles, the jury found Gevork Kartashyan, 45, guilty of conspiracy to commit health care fraud and health care fraud; and Eliza Shurabalyan, 42, guilty of health care fraud. U.S. District Judge Stephen V. Wilson of the Central District of Los Angeles scheduled sentencing for Oct. 5, 2009.
Shubaralyan and Kartashyan owned and operated CHH Medical Supply, a durable medical equipment (DME) supply company. Between January 2005 and June 2008, Shubaralyan and Kartashyan, through CHH Medical Supply, billed Medicare $949,859, and were paid $597,750. Virtually all of these bills were for medically unnecessary power wheelchairs and wheelchair accessories.
At trial, elderly Medicare beneficiaries testified about how they were recruited and taken to Los Angeles-area medical clinics. At the clinics, the beneficiaries turned over their Medicare numbers and other personal identifying information. Some were promised vitamins, diabetic shoes, and other items that they never received. The clinics were in the business of generating fraudulent power wheelchair prescriptions that could be sold to DME company owners who would bill Medicare for the wheelchairs. Many of the beneficiaries did not know they were getting a wheelchair until it was delivered to them by CHH Medical Supply. All of the beneficiaries testified that they did not need or use the wheelchair.
Five physicians testified that they never authorized or approved the power wheelchair prescriptions written under their names, often by physician’s assistants. Three of these physicians testified that they never even worked at the clinics listed on phony prescription pads.
A government witness, who recently pleaded guilty to health care fraud in connection with one of the clinics at issue in this case, testified that Kartashyan would regularly come into the office where he and others worked in order to pick up power wheelchair prescriptions that he had purchased. Upon delivery, Kartashyan would then generate phony forms stating that the beneficiaries’ homes were appropriate for the use of a power wheelchair, even though no home assessment was done.
Shubaralyan, who was the listed owner of CHH Medical Supply, submitted all of the company’s claims to Medicare. Power wheelchairs and accessories constituted over 98 percent of the company’s billings to Medicare. In addition, Shubaralyan withdrew over $195,000 in cash from the company’s bank account in order to purchase the power wheelchair prescriptions.
The case was prosecuted by Assistant Chief John S. (Jay) Darden and Trial Attorney Jonathan Baum of the Criminal Division’s Fraud Section, with the investigative assistance of the FBI. The case was brought as part of the Medicare Fraud Strike Force. Federal Prosecutors have indicted 115 cases with 257 defendants in Miami, Los Angeles, and Detroit since the inception of strike force operations in March 2007. Collectively, these defendants are alleged to have fraudulently billed the Medicare program for more than $600 million.
The joint DOJ-HHS Medicare Fraud Strike Force is a multi-agency team of federal, state and local investigators designed to combat Medicare fraud through the use of Medicare data analysis techniques and an increased focus on community policing. In May 2009, the Department of Justice and the Department of Health and Human Services announced the Health Care Fraud Prevention & Enforcement Action Team ("HEAT"), a joint effort to prevent fraud and enforce current anti-fraud laws around the country. As part of the HEAT initiative, Medicare Fraud Strike Force operations were expanded from South Florida and Los Angeles to Detroit and Houston. To learn more about the HEAT initiative, go to: www.hhs.gov/stopmedicarefraud.
Illinois Man Sentenced to Life in Prison for Production of Child Pornography and Other OffensesRead the Press Release
WASHINGTON – Carl Courtright III, of Granite City, Ill., was sentenced today to life plus 10 years in prison for production of child pornography and other offenses, Assistant Attorney General Lanny A. Breuer of the Criminal Division and U.S. Attorney for the Southern District of Illinois Courtney Cox announced.
A federal jury conv icted Courtright of one count of production of child pornography, two counts of possession of child pornography, one count of receipt of child pornography and one count of bank fraud following a five-day trial in March 2009 .
Evidence presented at trial revealed that the investigation of Courtright began when Illinois Attorney General Lisa Madigan required social networking site MySpace.com to provide information regarding all registered sex offenders in her state who were maintaining profiles on the site. Courtright was identified as someone who had a MySpace profile, and further investigation prompted investigators to seek a search warrant for his residence.
Evidence presented at trial showed that when the warrant was executed, law enforcement agents discovered evidence that Courtright had caused a local female child to engage in sexually explicit conduct and photographed the activity; downloaded and possessed child pornography videos and photographs including videos of prepubescent children being raped by adult males; and engaged in a bank fraud scheme involving his production of counterfeit checks that Courtright deposited into an account at Regions Bank as "donations" to an online ministry he maintains.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit
www.projectsafechildhood.gov.
The case was prosecuted by Assistant U.S. Attorney Nicole E. Gorovsky of the Southern District of Illinois and Trial Attorney James Silver of CEOS. The case was investigated by the Granite City, Ill., Police Department; the State of Illinois Attorney General’s Office; the U.S. Postal Inspection Service; the Illinois Internet Crimes Against Children Task Force; the Madison County, Ill., Sheriff’s Department; the Alton, Ill., Police Department; the Bethalto, Ill., Police Department; the FBI Metro East Cyber Crime Task Force; and CEOS’ High Tech Investigative Unit.
Georgia Temp Company and Its Owner/President Agree to Plead Guilty to Making a False Statement to the U.S. Small Business AdministrationRead the Press Release
WASHINGTON – A Georgia temporary staffing company and its owner/president have agreed to plead guilty to making a false statement to the U.S. Small Business Administration (SBA), the Department of Justice announced today.
Patriot Services Inc. and its owner/president, Stephanie Blackmon, have each agreed to plead guilty to a one-count charge of making a false statement to the SBA, which was filed today in U.S. District Court in Kansas City, Kan. Patriot supplies temporary staffing services to various agencies and departments of the U.S. government at various locations throughout the United States. Under the separate plea agreements, which are subject to court approval, Patriot and Blackmon have agreed to cooperate with the Department’s ongoing investigation.
Blackmon admitted to providing false information to the SBA so that Patriot could qualify for certification under Section 8(a) of the Small Business Act, a designation given to businesses owned and operated by socially and economically disadvantaged persons. Specifically, Blackmon concealed the involvement of her former employer, who was not a socially and economically disadvantaged person, in the management and operations of Patriot because revealing his involvement would have compromised Patriot’s chances of receiving 8(a) certification. By securing 8(a) certification, Patriot qualified for government contracts specifically set aside for 8(a) companies.
According to court documents, Blackmon purchased and became the president of Patriot in November 2003. Although Blackmon was the actual owner/president of Patriot, she was primarily a figurehead whose status as an African-American was used to obtain 8(a) certification for Patriot, thereby enabling Patriot, and her former employer, to obtain government 8(a) set-aside contracts. In fact, Patriot was actually controlled and operated by her former employer and others, who operated another temporary staffing company that was not eligible for the 8(a) program. Blackmon’s status as a service-disabled veteran also was used by Patriot to try to secure government contracts.
Although Blackmon knew that her former employer and others were actually running Patriot, she concealed their involvement so that the company could secure 8(a) certification. SBA regulations prohibit a former employer of any disadvantaged owner of an 8(a) applicant company from being involved in the management of the applicant company unless the SBA determines that the former employer does not have actual control of the applicant company or the potential to control the applicant company. Based in part on Blackmon’s misrepresentations, the SBA granted Patriot 8(a) status in November 2006. Shortly thereafter, Patriot entered into three 8(a) contracts to provide temporary staffing services to the Department of Veterans Affairs (VA) Consolidated Mail Outpatient Pharmacy (CMOP) in Leavenworth, Kan., one of seven such VA pharmacies throughout the nation that process and distribute medical prescriptions to veterans. Those contracts were valued at approximately $5.4 million.
Blackmon faces a maximum sentence of two years in prison and a fine of $5,000 for the false statement charge and Patriot faces a maximum fine of $5,000.
Today’s charges stem from an ongoing investigation into fraudulent conduct involving contract operations at CMOPs in Hines, Ill., and Leavenworth, Kan. On July 24, 2008, Joel M. Gostomelsky, the director of the Hines CMOP, pleaded guilty to conspiracy and to accepting illegal gratuities in connection with awarding temporary staffing and supply contracts. On May 5, 2009, the associate director of the Hines CMOP, William J. Brandt, his wife, Esperana A. Brandt, and her company, Pronto Staffing Inc. each pleaded guilty to being part of a conspiracy to commit wire fraud in connection with a scheme to defraud the VA and the SBA. William Brandt also pleaded guilty to wire fraud.
Today’s charges 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.
The ongoing investigation into fraudulent conduct involving the VA’s CMOPs is conducted jointly by the Department of Justice Antitrust Division’s Chicago Field Office and the VA’s Office of Inspector General, with assistance from the SBA’s Office of Inspector General; the Department of Defense, Criminal Investigative Service; and the U.S. Secret Service.
Anyone with information concerning bid rigging, fraud, kickbacks, bribery or other crimes relating to violations of federal procurement laws meant to foster competition concerning any of the VA CMOPs should contact the Chicago Field Office of the Antitrust Division at 312-353-7530 or the VA’s Office of Inspector General at 1-800-488-8244. Anyone with information about fraud in any SBA program should contact the SBA’s Office of Inspector General at 1-800- 767-0385 or www.sba.gov/ig/.
Former Bell, California, Police Officer Pleads Guilty to Federal Civil Rights CrimeRead the Press Release
WASHINGTON – Feliciano Sanchez, 34, a former officer with the Bell, Calif., Police Department, pleaded guilty yesterday in federal court in Los Angeles to a federal civil rights charge for sexually assaulting a female motorist, announced Acting Assistant Attorney General for the Civil Rights Division Loretta King and U.S. Attorney for the Central District of California Thomas P. O’Brien.
Sanchez admitted that on May 16, 2007, he sexually assaulted the victim by forcing her to provide oral sex after stopping her for a traffic violation, according to documents filed in court. Sanchez admitted that he took the victim in his patrol car to a location where he placed his hand on his duty weapon and forced her to orally copulate.
Sanchez faces a maximum sentence of 10 years imprisonment and a fine of $250,000. A sentencing hearing has been set for November 18, 2009.
"Law enforcement officers have a duty to protect the safety of all citizens, and citizens have the right to expect officers to help keep them from harm’s way," said Assistant Attorney General King. "Officers who abuse their powers in cases such as this not only violate the law, they violate the public trust. The Justice Department will continue to vigorously investigate and prosecute those who abuse their power."
"Officer Sanchez brutalized a person he had sworn to serve," said U.S. Attorney Thomas P. O’Brien. "As a result of his criminal conduct, Mr. Sanchez now faces a substantial amount of time in federal prison. His conduct eroded public confidence in law enforcement and cast a pall over his former colleagues who obey the law, proudly working to preserve public safety."
The case was investigated by agents from the FBI’s Los Angeles Field Office. The case was prosecuted by Assistant U.S. Attorney Tammy C. Spertus of the U.S. Attorney’s Office for the Central District of California and Civil Rights Division Trial Attorney Karen Ruckert and former Civil Rights Division Trial Attorney Christine Dunn.
Federal Court Permanently Bars Ft. Lauderdale, Florida Firm from Preparing Federal Tax Returns for OthersRead the Press Release
WASHINGTON – A federal court has permanently barred a Ft. Lauderdale, Fla.,-area woman and her company from preparing federal income tax returns for others, the Justice Department announced today. According to the government complaint in the case, Carole Exantus of Plantation, Fla., operated a company called J’s Corporation in Miami. The court found that J’s Corporation repeatedly prepared federal income tax returns claiming false tax credits and deductions that it knew would result in understating customers’ tax liabilities. Exantus agreed to the permanent injunction order without admitting wrongdoing.
The complaint alleged that Exantus and her employees frequently included in customers’ tax returns false claims for the fuel tax credit, which is available only for off-highway business use of fuels. The complaint further alleged that the returns Exantus and her employees prepared often claimed that her customers had bought more fuel than their incomes, as reported in the same returns, could have paid for.
Fuel credit scams are on this year’s IRS list of the Dirty Dozen Tax Scams. In the past few years the Justice Department has obtained injunctions shutting down many tax preparers who claimed the phony credits on customers’ returns.
John DiCicco, Acting Assistant Attorney General for the Justice Department’s Tax Division, thanked Brian H. Corcoran, the Justice Department trial attorney who handled the case, and Shauna Henline, a technical advisor with the IRS’s Small Business/Self-Employed Division, who conducted the investigation.
In the past decade, the Justice Department’s Tax Division has obtained injunctions against more than 410 tax-return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department Web site.
Cocaine Traffickers Sentenced to 235 Months in Prison on Drug ChargesRead the Press Release
WASHINGTON – Rene Oswald Cobar, a Guatemalan national, and Luis Angel Gonzalez-Largo, a Colombian national, were each sentenced today to 235 months in prison on federal drug charges, Assistant Attorney General Lanny A. Breuer of the Criminal Division announced. Cobar and Gonzalez-Largo were sentenced by U.S. District Judge James C. Mahan for the District of Nevada.
Cobar and Gonzalez-Largo were indicted on May 5, 2004, in the District of Nevada for conspiracy to distribute cocaine. They were again indicted on Jan. 24, 2007, in the District of Nevada with conspiracy to import five kilograms or more of cocaine into the United States. Cobar was also charged with additional offenses, including conspiracy to possess with intent to distribute heroin, and possession with intent to distribute heroin.
According to evidence presented at trial, in 2004 the DEA learned that Cobar, Gonzalez-Largo and other individuals were planning to transport 400 kilograms of cocaine from Central America to a buyer in Las Vegas, who was an undercover law enforcement agent. Evidence presented at trial showed that Cobar acted as the broker for the undercover buyer and Gonzalez-Largo was identified as the Colombian supplier of the cocaine. In various recorded phone conversations, the defendants discussed that Gonzalez-Largo had 800 kilograms of cocaine in Panama. The defendants’ efforts to transport the cocaine failed because of law enforcement efforts in Panama, and the defendants’ arrests on unrelated charges.
Evidence presented in court showed that Cobar was also involved in a conspiracy to transport heroin from Central America to Las Vegas.
After a 10-day jury trial, Gonzalez-Largo was convicted on Feb. 18, 2008, of conspiracy to import cocaine into the United States. Cobar elected to waive his right to a jury trial and proceeded with a bench trial. On Feb. 23, 2008, Judge Mahan found Cobar guilty of conspiracy to import cocaine into the United States, and of the additional charges of conspiracy to import heroin into the United States and conspiracy to possess with the intent to distribute heroin.
These cases were prosecuted by Trial Attorneys John Gillies and Steven May of the Criminal Division’s Narcotic and Dangerous Drug Section (NDDS), who were assisted by NDDS paralegal Arianne Tice. The investigation in this case was led by the U.S. Drug Enforcement Administration, in close cooperation with local Nevada law enforcement from the Henderson, Nev., Police Department and the Las Vegas Metropolitan Police Department.
16 July 2009
Justice Department Seeks to Close Miami-Area Tax FirmRead the Press Release
WASHINGTON – The United States has sued four Hialeah, Fla., tax return preparers – Alberto Alem, Beatriz Sardinas and Pilar Medina and their company, PCPS Corp. – seeking to put them out of business, the Justice Department announced today. The civil injunction suit was filed in Miami with the U.S. District Court for the Southern District of Florida.
According to the civil injunction complaint, the defendants prepare federal income tax returns with fabricated claims for the federal fuel tax credit. The credit is available in limited circumstances for fuel purchased for off-highway business use. Fraudulently claiming the fuel tax credit is one of the Internal Revenue Service’s Dirty Dozen Tax Scams for 2009. The government complaint alleges that PCPS’s false claims for federal fuel tax credits appeared on almost 1,500 returns in 2006 and 2007 with total fraudulent claims exceeding $3.6 million.
In the past decade the Justice Department’s Tax Division has obtained injunctions against more than 410 tax return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department Web site.
Justice Department Releases New Fact Sheet on the Rights of Persons with HIV or AIDS to Obtain Occupational Training and State LicensingRead the Press Release
WASHINGTON – The Justice Department today released a new technical assistance fact sheet on legal requirements relating to admitting individuals with HIV or AIDS to occupational training schools and granting state licensure in occupations such as barbering, massage therapy and home health care assistance.
Persons with HIV and AIDS unfortunately still face obstacles in obtaining training and state licensure in these occupations because of overly broad state licensure requirements that applicants be free of communicable diseases. Because HIV disease is not communicated through casual contact, excluding individuals with HIV under these licensure requirements is unnecessary and discriminates against these individuals in violation of the Americans with Disabilities Act. This publication is intended to provide guidance for state licensing agencies and occupational training schools so that individuals with HIV or AIDS have an equal opportunity to pursue these occupations.
"People with HIV or AIDS should not be denied access to their chosen profession because of outdated laws or unfounded stereotypes and fears. The Civil Rights Division of the U.S. Department of Justice is committed to the full and fair enforcement of the Americans with Disabilities Act," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division.
The Americans with Disabilities Act protects individuals with disabilities from discrimination in all activities of state and local government entities and by public accommodations. This publication and additional information about the Civil Rights Division is available at the Department’s ADA Web site at http://www.ada.gov.
Former Boeing Engineer Convicted of Economic Espionage<br /> in Theft of Space Shuttle Secrets for ChinaRead the Press Release
A former Rockwell and Boeing engineer from Orange County, Calif., was remanded into custody this morning after a federal judge convicted him of charges of economic espionage and acting as an agent of the People’s Republic of China, for whom he stole restricted technology and Boeing trade secrets, including information related to the Space Shuttle program and Delta IV rocket.
Dongfan "Greg" Chung, 73, who was employed by Rockwell International from 1973 until its defense and space unit was acquired by Boeing in 1996, was found guilty by U.S. District Judge Cormac J. Carney, who presided over a three-week bench trial last month.
In his ruling read this morning in court, Judge Carney found Chung guilty of conspiracy to commit economic espionage, six counts of economic espionage to benefit a foreign country, one count of acting as an agent of the People’s Republic of China and one count of making false statements to the FBI.
Immediately following the reading of the verdicts, Judge Carney remanded Chung into custody, where he will remain until his sentencing, which was scheduled for Nov. 9, 2009. Chung had been freed after being arrested by special agents with the FBI and investigators with NASA in February 2008.
Chung, a native of China who is a naturalized U.S. citizen, held a "secret" security clearance when he worked at Rockwell and Boeing on the Space Shuttle program. He retired from the company in 2002, but the next year he returned to Boeing as a contractor, a position he held until September 2006. At trial last month, the government proved that Chung took and concealed Boeing trade secrets relating to the Space Shuttle and the Delta IV rocket, materials he acquired for the benefit of the PRC.
David Kris, Assistant Attorney General for National Security, said: "For years, Mr. Chung stole critical trade secrets from Boeing relating to the Space Shuttle and the Delta IV rocket – all for the benefit of the government of China. Today’s verdict should serve as a warning to others willing to compromise America's economic and national security to assist foreign governments. The many agents, analysts and prosecutors who worked on this important case deserve special thanks for their efforts."
"Mr. Chung stole restricted technology for the benefit of a foreign nation, and as a result he has lost the freedom he was offered by this nation," said U.S. Attorney Thomas P. O’Brien. "The stolen technology compromised not only the American company that developed and owned the trade secrets, but national security as well because the secrets could be used by the PRC to develop its own military technology."
Salvador Hernandez, Assistant Director in Charge of the FBI in Los Angeles, stated: "The cost of Mr. Chung’s traitorous actions to American security and the economy cannot be quantified, but have now been exposed, and his ability to exploit critical technology has come to an end. FBI counter-intelligence agents and NASA received the full cooperation of the Boeing Company in building this three-year investigation, the successful outcome of which marks the first conviction by trial under the Economic Espionage Act of 1996. I’m confident this milestone conviction will serve as a deterrent to would-be spies contemplating theft of precious U.S. secrets."
The case against Chung resulted from an investigation into another engineer who worked in the United States and obtained sensitive military information for the PRC. That engineer, Chi Mak, and several of his family members were convicted of providing defense articles to the PRC. Chi Mak was sentenced last year to more than 24 years in federal prison (see: http://www.usdoj.gov/usao/cac/pressroom/pr2008/032.html).
According to the evidence presented during the trial, individuals in the Chinese aviation industry began sending Chung "tasking" letters as early as 1979. Over the years, the letters directed Chung to collect specific technological information, including data related to the Space Shuttle and various military and civilian aircraft. Chung allegedly responded in one undated letter that "I would like to make an effort to contribute to the Four Modernizations of China." In various letters to his handlers in the PRC, Chung referenced engineering manuals he had collected and sent to the PRC, including 24 manuals relating to the B-1 Bomber that Rockwell had prohibited from disclosure outside of the company and "selected federal agencies."
Between 1985 and 2003, Chung made multiple trips to the PRC to deliver lectures on technology involving the Space Shuttle and other programs, and during those trips he met with PRC government officials, to include agents affiliated with the People’s Liberation Army. Chung and PRC officials exchanged letters that discussed Chung’s travel to China and recommended methods for passing information, including suggestions that Chung use Chi Mak and his wife Rebecca to transmit information. A May 2, 1987, letter from Gu Weihao, an official in the Ministry of Aviation and China Aviation Industry Corporation, discussed the possibility of inviting Chung’s wife, who is an artist, to visit an art institute so that Chung could use her trip as an excuse to travel to the PRC. This same letter suggested that passing information to the PRC through Chi Mak would be "faster and safer" and concluded with the statement: "It is your honor and China’s fortune that you are able to realize your wish of dedicating yourself to the service of your country."
On Sept. 11, 2006, FBI and NASA agents searched Chung’s house and found more than 250,000 pages of documents from Boeing, Rockwell and other defense contractors inside the house and in a crawl space underneath the house. Among the documents found in the crawl space were scores of binders containing decades’ worth of stress analysis reports, test results and design information for the Space Shuttle.
Each charge of economic espionage carries a maximum possible penalty of 15 years in federal prison and a $500,000 fine. The charge of acting as an agent of a foreign government carries a maximum penalty of 10 years imprisonment and a $250,000 fine. The charges of conspiracy to commit economic espionage and making false statements to federal investigators each carry a maximum possible penalty of five years imprisonment and a $250,000 fine.
In this morning’s ruling, Judge Carney acquitted Chung of one count of obstruction of justice.
The investigation in this case was conducted jointly by the FBI and NASA Counterintelligence. The case was prosecuted by Assistant U.S. Attorneys Greg Staples and Ivy Wang.
Chief Engineer and Second Engineer Plead Guilty to Concealing Vessel PollutionRead the Press Release
WASHINGTON – Panagiotis Stamatakis, the chief engineer on the Cyprus-flagged M/V Myron N, and the second engineer, Dimitrios Papadakis, both citizens of Greece, pleaded guilty today in U.S. District Court in Trenton, N.J., to using falsified records that concealed improper discharges of untreated bilge waste from the cargo ship, the Justice Department announced.
District Court Judge Peter G. Sheridan for the District of New Jersey scheduled sentencing for Sept. 8, 2009. Stamatakis and Papadakis each faces up to six years in prison, to be followed by three years of supervised release and a $250,000 fine.
The government’s investigation began in September 2008, when inspectors from the U.S. Coast Guard conducted an examination of the M/V Myron N, following the ship’s arrival in Gravesend Anchorage, N.Y. and subsequently in the Port of Newark, N.J. The M/V Myron N is a 38,337 gross ton dry bulk carrier vessel operated and managed by Dalnave Navigation Inc., which is incorporated in the Republic of Liberia. The inspections uncovered evidence that crewmembers had improperly handled and disposed of the ship’s untreated bilge waste, using a pipe to bypass its pollution control system. To conceal these activities, Stamatakis and Papadakis knowingly failed to record those discharges in the ship’s official oil record book.
Engine room operations on board large oceangoing vessels such as the M/V Myron N generate large amounts of waste oil and oil-contaminated bilge waste. International and U.S. law prohibit the discharge of waste containing more than 15 parts per million of oil and without treatment by an oily water separator—a required pollution prevention device. Law also requires all overboard discharges be recorded in an oil record book, a required log which is regularly inspected by the Coast Guard.
Stamatakis served as the chief engineer aboard the M/V Myron N between November 2007 and September 2008 and was responsible for all engine room operations. Papadakis served as an engineer on the M/V Myron N from November 2007 until September 2008. Between November 2007 and September 2008, under the supervision of Stamatakis, Papadakis ordered engine room crew members to discharge untreated bilge fluids from the ship’s bilge holding tank directly into the ocean. When the M/V Myron N entered the Gravesend Bay Anchorage on Sept. 8, 2008, and subsequently the Port of Newark, the ship’s log, which Stamatakis was responsible for maintaining, failed to disclose the overboard discharge of oil-contaminated bilge water.
"Lying to the Coast Guard, obstructing a federal investigation and bypassing mandatory pollution controls is unacceptable,"said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. "As long as individuals and companies continue to bypass this nation’s environmental laws, the Justice Department will continue to bring charges and seek justice for those involved."
The case was investigated by the U.S. Coast Guard, Coast Guard Investigative Service and the Environmental Protection Agency, Criminal Investigation Division. It was prosecuted by Assistant U.S. Attorney Kathleen P. O’Leary of the U.S. Attorney’s Office for the District of New Jersey, Special Assistant U.S. Attorney Christopher P. Mooradian of the U.S. Coast Guard First District Legal Office, and Trial Attorney Gary N. Donner of the Justice Department’s Environmental Crimes Section.