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4 March 2009
Justice Department Sues Large Multi-Family Housing Developer Alleging Disability-Based Housing DiscriminationRead the Press Release
WASHINGTON– The Justice Department filed a lawsuit today against JPI Construction L.P. (JPI) and six JPI-affiliated companies in U.S. District Court in Dallas for failing to provide accessible features required by the Fair Housing Act and the Americans with Disabilities Act at multi-family housing developments in Texas and other states.
Since 1991, when the Fair Housing Act first required most new multi-family housing to contain accessible features, JPI and its affiliates have built more than 200 apartment, condominium and other housing complexes in 26 states and the District of Columbia.
"Persons with physical disabilities should have the same housing choices as other persons," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "We will continue to pursue vigorously those who still have not gotten the message that failing to design and construct multi-family housing with basic features of accessibility violates the law."
The Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability. According to the complaint, the defendants failed to design and construct accessible dwelling units and public and common use areas at Jefferson Center Apartments in Austin, Texas; Jefferson at Mission Gate Apartments in Plano, Texas; and additional multi-family housing complexes in other states. According to the complaint, certain complexes designed and constructed by the defendants have inaccessible steps and curbs leading to units, steeply sloped routes leading to units, and no accessible routes to site amenities, including inaccessible trash facilities, barbeque grills and cookout tables. In addition, certain housing units have narrow doors and hallways; kitchens that lack accessible clear floor space at the sinks, ranges and refrigerators; bathrooms that lack accessible clear floor space at the toilets and tubs; and thermostats that are mounted too high to be accessible to a person using a wheelchair.
The lawsuit seeks a court order requiring the defendants to modify the complexes to bring them into compliance with federal laws and prohibiting future discrimination by the defendants. The lawsuit also seeks monetary damages to compensate victims and a civil penalty to be paid to the government.
Fighting illegal housing discrimination is a top priority of the Justice Department. More information about the Civil Rights Division and the laws it enforces is available at http://www.usdoj.gov/crt. Additional information about the Fair Housing Act is also available at www.HUD.gov. Individuals who believe that they may have been victims of housing discrimination can call the Housing Discrimination Tip Line at 1-800-896-7743, e-mail the Justice Department at [email protected], or contact the U.S. Department of Housing and Urban Development at 1-800-669-9777.
The complaint is an allegation of unlawful conduct. The allegations must still be proven in federal court.
Justice Department Settles Lawsuit Against Stimson Lumber Company to Enforce the Employment Rights of Oregon ReservistRead the Press Release
WASHINGTON - The Department of Justice announced today that it has entered into a consent decree with Stimson Lumber Company (Stimson) that, if approved by the court, will resolve the Department’s complaint, also filed today, that Oregon-based Stimson failed to reemploy Oregon reservist David Eckhardt in violation of the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA).
USERRA was enacted in 1994 to protect service members from being disadvantaged in their civilian careers due to serving in the uniformed services. Subject to certain limitations, USERRA requires that individuals who leave their jobs to serve in the U.S. military be timely reemployed by their civilian employers in the same position, or a comparable position, to the position that they would have held had they not left to serve in the military.
The Department’s complaint, filed in U.S. District Court in Portland, Ore., alleges that Stimson violated USERRA by failing or refusing to promptly reemploy David Eckhardt upon his return from military service in the Naval Reserves. In March 2007, Eckhardt attended a required military training program. After a short recovery period from an injury sustained during his military training obligation, Eckhardt contacted Stimson in April 2007 to seek reemployment as a boiler operator. The complaint alleges that Stimson failed or refused to reemploy Eckhardt, notifying him that the company had hired another individual to replace him. Under the terms of the consent decree, Stimson is required to provide remedial relief to Eckhardt in the form of an undisclosed monetary payment. Stimson is also prohibited from retaliating against persons who exercise their rights under USERRA.
"No person should lose his civilian job for choosing to serve in the military," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Department demonstrates again with this settlement that it is committed to vigorously enforcing federal laws that protect the employment rights of men and women who are serving in the military. We are pleased that Stimson has chosen to resolve this lawsuit and abide by the requirements of USERRA."
The Civil Rights Division has given a high priority to the enforcement of service members’ rights under USERRA. Additional information about USERRA can be found on the Justice Department Web sites: http://www.servicemembers.gov and www.usdoj.gov/crt/emp .
Justice Department Settles Lawsuit Against Ecolab Inc. to Enforce Employment Rights of Michigan U.S. Army VeteranRead the Press Release
WASHINGTON - The Department of Justice announced today that it has entered into a consent decree with Ecolab Inc. (Ecolab) that will resolve the Department’s complaint, which was filed today, that Ecolab failed to reemploy Michigan veteran Stephen Alasin in violation of the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended (USERRA). The consent decree was approved by the court today as well.
USERRA was enacted in 1994 to protect service members from being disadvantaged in their civilian careers due to serving in the uniformed services. Subject to certain limitations, USERRA requires that individuals who leave their jobs to serve in the U.S. military be timely reemployed by their civilian employers in the same position, or a comparable position, to the position that they would have held had they not left to serve in the military.
The Department’s complaint, filed in U.S. District Court in Detroit, alleges that Ecolab violated USERRA by failing or refusing to promptly reemploy Alasin upon his return from military service. Alasin enlisted in the U.S. Army in 2003 and served for almost three years, including a tour of duty in Iraq. Alasin received several medals for his military service. Upon receiving an honorable discharge in February 2006, Alasin contacted Ecolab to seek reemployment as a senior service specialist but, the complaint alleges, Ecolab failed or refused to reemploy Alasin. Under the terms of the consent decree Ecolab is required to pay Alasin $118,000 and prohibits Ecolab from retaliating against any persons who exercise their rights under USERRA.
"The Department is committed to vigorously enforcing federal laws that protect the employment rights of our service members, and cases like this, on behalf of a service member who was not reemployed following military service, further reinforce that commitment," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Department commends Ecolab for working cooperatively to resolve this matter and for its prompt corrective action to ensure prospective compliance with its obligations under USERRA."
"Along with the rights and liberties all Americans enjoy, our laws also impose some duties and responsibilities, including to honor the sacrifices of American soldiers returning home by allowing them to return to their jobs," said Acting U.S. Attorney Terrence Berg for the Eastern District of Michigan.
Ecolab has advised the Justice Department that the company considered this an isolated and regrettable incident, and that Ecolab already has made changes to its application process to ensure that similar incidents will not occur in the future.
The Department filed its suit against Ecolab after receiving Alasin’s complaint from the Veterans’ Employment and Training Service of the Department of Labor, upon completion of its investigation and settlement efforts.
The Civil Rights Division has given a high priority to the enforcement of service members’ rights under USERRA. Additional information about USERRA can be found on the Justice Department Web site at: http://www.servicemembers.gov and www.usdoj.gov/crt/emp.
Colombian Paramilitary Leader Extradited to the United States to Face U.S. Drug ChargesRead the Press Release
WASHINGTON – Miguel Angel Mejia-Munera, a/k/a "El Mellizo," was extradited today from Colombia to the United States to face narcotics trafficking charges, announced Acting Assistant Attorney General Rita M. Glavin of the Criminal Division and Acting Administrator Michele M. Leonhart of the U.S. Drug Enforcement Administration (DEA).
According to the indictment, Miguel Angel Mejia-Munera, together with his twin brother Victor, led a major Colombian narcotics trafficking organization known as "the Twins" or "Los Mellizos" Organization. Victor Mejia-Munera was killed in April 2008 in a gun battle with the Colombian military. Miguel Angel Mejia-Munera was also allegedly a leader of the Autodefensas Unidas de Colombia (AUC), a Colombian right-wing paramilitary and drug-trafficking organization, designated by the U.S. State Department as a Foreign Terrorist Organization. Miguel Angel Mejia-Munera, the alleged leader of the Bloque Arauca of the AUC, is an Organized Crime Drug Enforcement Task Force (OCDETF)-designated Consolidated Priority Organizational Target (CPOT).
According to the indictment, returned in the District of Columbia on Jan. 29, 2004, Miguel Angel Mejia-Munera and his organization were responsible for exporting multi-thousand kilogram quantities of cocaine from Colombia to Central America, Mexico and the United States from January 1994 to January 2004.
Miguel Angel Mejia-Munera is charged in the indictment with conspiracy to import five kilograms or more of cocaine into the United States and conspiracy to manufacture and distribute five kilograms or more of cocaine, with the intent to import the cocaine into the United States. He is also charged with conspiracy to possess with intent to distribute five kilograms or more of cocaine on board a vessel subject to the jurisdiction of the United States, and with possessing and attempting to possess five kilograms or more of cocaine on board a vessel subject to the jurisdiction of the United States. Mejia-Munera also faced charges in Colombia for his alleged criminal acts.
"Through today’s extradition, Miguel Angel Mejia-Munera can now be held accountable in a U.S. court for the very serious crimes he is charged with committing," said Acting Assistant Attorney General Rita M. Glavin. "His arrival in the United States sends a message that neither the United States nor Colombia will tolerate this kind of criminal activity. The Department will continue to work in close cooperation with our Colombian law enforcement partners in combating the drug trafficking that has claimed victims in both our nations."
"The extradition of this drug kingpin closes the book on another major Colombia-based drug trafficking organization that not only was responsible for exporting massive quantities of cocaine destined for the United States, but also funded terrorist activities," said DEA Acting Administrator Michele M. Leonhart. "Miguel Angel Mejia-Munera’s claim to have demobilized under Colombia’s Justice and Peace Process is without legal merit since he refused prison confinement as is required by the Colombian Justice and Peace Law. His capture by the valiant efforts of the Colombian National Police and his extradition today underscore the resolve of our Colombian counterparts to continue working closely with us to dismantle drug and terrorist organizations."
An indictment is a formal charging document notifying the defendant of his charges. All persons charged by an indictment are presumed innocent until proven guilty.
If convicted of the charges against him, Miguel Angel Mejia-Munera faces a minimum sentence of 10 years in prison.
The case is being prosecuted by attorneys from the Criminal Division’s Narcotic and Dangerous Drug Section. Significant assistant was provided by the Criminal Division’s Office of International Affairs. The investigation in this case was led by the DEA.
3 March 2009
Kansas Cardiologist to Pay U.S. $1.3 Million to Settle False Claims Act AllegationsRead the Press Release
WASHINGTON – Joseph P. Galichia, M.D. and Galichia Medical Group P.A., a Kansas cardiologist and his practice group, have agreed to pay the United States $1.3 million to settle claims that the physician and his group violated the False Claims Act between 2001 and 2006, by submitting false claims to Medicare, the Justice Department announced today. The government contends that claims were submitted for services not provided, and in other instances, claims were submitted without proper documentation.
In May 2000, Galichia and Galichia Medical Group agreed to pay more than $1.5 million to settle a previous False Claims Act matter. In that case, the government contended that between 1993 and 1998, Galichia billed Medicare for a higher level of services than provided (up-coding), billed twice for the same services, and billed for services not provided.
"The Department of Justice is committed to ensuring that Medicare funds are paid out appropriately for services actually provided to beneficiaries," said Michael F. Hertz, Acting Assistant Attorney General for the Department’s Civil Division.
As part of the $1.3 million settlement, Galichia and Galichia Medical Group have entered into an Integrity Agreement with the U.S. Department of Health and Human Services, Office of Inspector General. The Integrity Agreement contains measures to ensure compliance with Medicare regulations and policies in the future.
"Exposing Medicare fraud is a top government priority," said Lewis Morris, Chief Counsel to the Inspector General of the Department of Health & Human Services. "We will aggressively pursue both individuals and companies seeking to enrich themselves by cheating U.S. taxpayers and the nation’s health care system."
The settlement here was the result of a coordinated effort among the Commercial Litigation Branch of the Justice Department’s Civil Division; the U.S. Attorney’s Office for the District of Kansas; and the Department of Health and Human Services’ Office of Inspector General and Office of Counsel to the Inspector General.
Marietta Parker, Acting U.S. Attorney for the District of Kansas, commended the following investigators for their work on the case: Dan Coney of the Department of Health and Human Services’ Office of Inspector General, Troy Bird of the U.S. Postal Service’s Office of Inspector General and David Nitz of the U.S. Postal Inspection Service.
2 March 2009
United States Intervenes in Case Against EMC Corporation Alleging False Claims on Sales of Hardware, Software and Technology ServicesRead the Press Release
WASHINGTON -- The United States has intervened and filed a complaint in a qui tam suit accusing EMC Corp. of failing to disclose its commercial pricing practices during negotiation of its General Services Administration (GSA) contracts and of providing improper payments and other things of value to Systems Integrators and other Alliance Partners on contracts with government agencies, the Justice Department announced today.
The suit was originally filed in U.S. District Court in Little Rock, Ark., by Norman Rille, and his co-plaintiff, Neal Roberts, under the qui tam or whistleblower provisions of the False Claims Act. Under the qui tam statute, a private party, known as a "relator," can file an action on behalf of the United States and receive a portion of the recovery. Under the False Claims Act, the United States may recover three times the amount of its losses plus civil penalties.
Mr. Rille and Mr. Roberts alleged that EMC submitted false claims to the United States for information technology (IT) hardware and services on numerous government contracts from the late 1990’s to the present. The core of the relators’ allegations, in which the United States has joined by filing its own complaint, is that EMC made payments of money and other things of value (alliance benefits) to a number of systems integration consultants and other alliance partners with whom it had alliance relationships. The government’s complaint asserts that these alliance relationships and the resulting alliance benefits paid by EMC amount to kickbacks and undisclosed conflict of interest relationships.
The government also alleges that EMC made false statements to GSA about its commercial pricing practices in order to obtain a higher price on its contracts thereby overcharging federal agencies purchasing EMC products and services.
Acting Assistant Attorney General Michael F. Hertz announced the Department’s intervention in the suit and stated that the government joined the suit "as a part of the Department of Justice’s continuing efforts to ensure the integrity of the procurement process."
The investigation of the allegations in the qui tam complaint was conducted by the U.S. Attorney’s office in Little Rock, Ark., the Department’s Civil Division, the General Services Administration Office of the Inspector General, the Defense Criminal Investigative Service, the Office of Inspector General of the Department of Energy, the Defense Contract Audit Agency and the Postal Service Office of the Inspector General.
United States Files Suit Against Missouri-Based Pharmaceutical<br /> to Block Manufacturing and Shipping of Unapproved DrugsRead the Press Release
WASHINGTON – The United States has filed a lawsuit to block KV Pharmaceutical Company, its subsidiaries, ETHEX Corp. and Ther-Rx Corp., and its principal officers from making and distributing adulterated and unapproved drugs, the Justice Department announced today. At the same time, KV agreed to the injunction in a consent decree.
The FDA conducted inspections of KV facilities between December 2008 and February 2009 and found that the St. Louis-based company had committed significant violations of the Food and Drug Administration’s (FDA) Current Good Manufacturing Practices (CGMP) regulatory requirements and continued to manufacture unapproved drugs. As a result of FDA’s inspections, KV recalled products manufactured and distributed from its facilities. Those recalled products will be destroyed.
Under the terms of the agreement reached with the government, the defendants cannot resume manufacturing and distributing drugs until an independent expert, retained by KV, conducts a comprehensive inspection of the company’s facilities and certifies that they are in compliance with the FDCA and CGMP, and FDA gives written notification that they can resume operations. Thereafter, the consent decree requires defendants to retain an independent expert to conduct audit inspections of the company’s drug manufacturing operations to ensure they remain in compliance. The inspections must occur once every six months for a period of no less than two years and annually thereafter for an additional three years.
The agreement states that should the defendants fail to comply with the consent decree, FDCA or GCMP in the future, it empowers FDA to order the defendants to cease operations, recall drug products and/or take other correction actions. The consent decree also imposes liquidated damages on KV if it fails to comply with an of its provisions.
Department of Justice Releases Nine Office of Legal Counsel Memoranda and OpinionsRead the Press Release
WASHINGTON -- The Department of Justice today released two previously undisclosed Office of Legal Counsel (OLC) memoranda and seven previously undisclosed opinions.
"Americans deserve a government that operates with transparency and openness," said Attorney General Eric Holder. "It is my goal to make OLC opinions available when possible while still protecting national security information and ensuring robust internal executive branch debate and decision-making."
The two memoranda memorialized that certain legal propositions in ten OLC opinions issued between 2001 and 2003 no longer reflected the views of OLC and "should not be treated as authoritative for any purpose." They further explained that some of the underlying opinions had been withdrawn or superseded and that "caution should be exercised" by the executive branch "before relying in other respects" on the other opinions that had not been superseded or withdrawn.
In light of the legitimate and substantial public interest in many of the questions raised in those opinions and in the evolution of OLC’s views on those questions, the Department has released the six of those underlying opinions from 2001-2003 that are not classified and that had not previously been disclosed.
In November 2008, the Department filed a motion in a pending civil action to submit two of those underlying OLC opinions, along with one other, to the court under seal. The Department has determined that there is no longer any reason the three opinions should remain under seal and is therefore withdrawing its motion.
The opinions and memoranda are available at http://www.usdoj.gov/opa/documents/olc-memos.htm.
27 February 2009
Justice Department Files Lawsuit Against Wagner Industrial Electric Inc., to Enforce the Employment Rights of Indiana Army National GuardsmanRead the Press Release
WASHINGTON - The Department of Justice announced today that it has filed a lawsuit on behalf of Kevin Stenger, an Indiana National Guard member, against Wagner Industrial Electric Inc. (Wagner), alleging violations of the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA).
USERRA was enacted in 1994 to protect service members from being disadvantaged in their civilian careers due to serving in the uniformed services. Subject to certain limitations, USERRA requires that individuals who leave their jobs to serve in the U.S. armed forces be timely reemployed by their civilian employers in the same positions, or comparable positions, as the positions that they would have held if they had not left to serve in the military.
The complaint, filed in U.S. District Court in Dayton, Ohio, alleges that Wagner violated USERRA by failing or refusing to promptly reemploy Stenger to his previous position as a foreman when he returned to work after his two weeks of annual training with the Indiana Army National Guard at Fort Leavenworth, Kan. Upon the completion of his two-week military training, Stenger contacted Wagner to seek reemployment in his foreman position. Instead, Wagner reemployed Stenger as a journeyman, a position with a lower salary, fewer responsibilities and fewer opportunities for overtime.
"No person should lose his civilian job for choosing to serve in the military," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Civil Rights Division is committed to vigorously enforcing federal laws that protect the employment rights of men and women who are serving in the military."
The Civil Rights Division has given a high priority to the enforcement of service members’ rights under USERRA. Additional information about USERRA can be found on the Justice Department Web site at: http://www.servicemembers.gov and www.usdoj.gov/crt/emp.
International Criminal Figure Pleads Guilty to $138 Million Fuel Tax Scheme After Nearly 13 Years as a FugitiveRead the Press Release
WASHINGTON – After nearly 13 years as a fugitive, a former New Jersey resident has been returned to the United States, and pleaded guilty today to conspiring to committing one of the nation’s largest known motor fuel excise tax schemes, Acting Assistant Attorney General Rita M. Glavin of the Criminal Division announced.
Aaron Misulovin a/k/a Albert Friedman, a/k/a Valery Vibornov, pleaded guilty before U.S. District Judge Joseph E. Irenas in Camden, N.J., to one count of conspiracy, three counts of wire fraud, three counts of money laundering and three counts of tax evasion. According to the terms of the plea agreement accepted today by Judge Irenas, Misulovin will be sentenced to five years in prison, and could face a fine of up to $2.5 million and restitution. Sentencing is scheduled for June 19, 2009.
On Aug. 3, 1995, an indictment was returned by a federal grand jury in New Jersey, charging Misulovin and 24 other individuals, 15 of whom were émigrés from Eastern Europe, with conspiring to defraud the United States and the state of New Jersey of approximately $138 million in motor fuel excise taxes, and to commit the substantive offenses of wire fraud, money laundering and tax evasion. Misulovin was born in Riga, Latvia, and was naturalized as a U.S. citizen.
According to the indictment, Misulovin and co-defendants Igor Erlikh and Demetrios Karamanos, operated Kings Motor Oils (Kings), a wholesale fuel distributorship with offices in Edison, N.J. From 1989 through 1994, Kings purchased hundreds of millions of gallons of tax-free home heating oil, but through an elaborate scheme sold it as tax-paid diesel fuel to PetroPlus, a fuel wholesaler located in Deptford, N.J., which was owned and operated by co-defendant Daniel Enright. PetroPlus then sold the fuel to unknowing customers as diesel fuel for highway use, and charged and collected the applicable federal and state taxes. Under U.S. and New Jersey law, the co-conspirators incurred the tax liability for the sale of the fuel. However, instead of paying the IRS and state revenue authorities as required, the amount collected for the taxes were distributed among Enright, Misulovin, Erlikh, Karamanos and other conspirators in the scheme.
According to court documents, Kings and PetroPlus insulated themselves by inserting a series of shell companies, nominee companies and other sham entities (known collectively as "middle companies") between them in the distribution chain to give the appearance that these companies actually bought and sold the fuel. In reality, these companies never took title or possession of the fuel. According to court documents, the sole purpose of these middle companies was the generation of false and fraudulent invoices and other paperwork to disguise the true transactions between Kings and PetroPlus. One of the middle companies in each transaction would be positioned as the "burn" company – the entity that appeared on paper to bear the tax liability and that would disappear in the event of an investigation. However, the scheme was designed so that on the face of the paperwork, it always appeared that Kings and PetroPlus were relieved of any tax liability. In the early-1990s, this scheme was commonly known as a "daisy chain" scheme, and often involved organized crime groups. The "daisy chain" made it difficult for the IRS and state revenue authorities to identify those responsible to pay the federal and state taxes, and to trace the movement of the illicit proceeds. The illicit proceeds were then laundered through various bank accounts throughout the United States and overseas.
Court documents show that the sophistication and scale of this illegal operation required the participation of a number of Eastern European émigrés responsible for the creation of many of the middle companies. According to court documents, the conspirators used false identification to incorporate companies, open bank accounts, and establish storefront offices used to facilitate the scheme.
On June 19, 1998, following a nine-and-a-half-month jury trial before Judge Irenas in U.S. District Court for the District of New Jersey, Enright and Karamanos were convicted for their role in the conspiracy and related charges. Also convicted at trial were co-defendants Richard Pedroni and Mary Ingram, both wholesale motor fuels distributors in New Jersey. Two additional defendants were acquitted. Seventeen co-defendants pleaded guilty prior to trial. Enright was sentenced to 16 years in prison and ordered to pay restitution of $1 million.
At the trial of Misulovin’s co-defendants in 1997 and 1998, testimony revealed that that Misulovin and Erlikh recruited many of their friends and associates to set up the middle companies. One government witness, who had been charged as a co-conspirator and pleaded guilty, testified that he considered Misulovin his, "boss in crime." In addition, the witness revealed that Misulovin and others instructed this witness and members of his crew to form many of the middle companies using false identification. The false identification documents and corporate records of these middle companies were securely stored in a "safe house" in Brooklyn, N.Y., which Misulovin visited. Witness testimony further showed that when government agents grew suspicious about a particular middle company, Misulovin ordered that all relevant documents be destroyed. Evidence was also presented that Misulovin and Erlikh traveled to Europe during the course of the scheme to open bank accounts to be used in laundering the illegal proceeds. The evidence admitted at trial proved that, throughout the course of the scheme, Misulovin and his co-conspirators caused $596,255,927 to be wired through the middle companies. The scheme resulted in the United States being defrauded of $132,376,800. In addition, the state of New Jersey was defrauded of $11,892,297.
Misulovin and Erlikh evaded arrest on the charges by fleeing the United States in 1995. They were both considered fugitives by U.S. law enforcement, and became the subjects of an international search through notices posted by Interpol. In 1999, Erlikh was returned to the United States by Ukrainian authorities. Erlikh pleaded guilty, and was sentenced to nine years in prison and ordered to pay $1 million in restitution.
In April 2004, Israeli police arrested Misulovin, in connection with their investigation of a major international money laundering operation involving an underground bank in Israel. At the time of Misulovin’s arrest, the Israeli police froze three accounts tied to Misulovin, and seized forged and fraudulent travel documents used by Misulovin to conceal his identity. The Israeli police also seized an illegal Glock-17 firearm and ammunition from Misulovin.
U.S. and Israeli law enforcement authorities cooperated extensively throughout the duration of the Israeli investigation and prosecution of Misulovin. During this investigation, it was revealed that a portion of the funds Misulovin had laundered through the underground bank in Israel had been originally generated by his "daisy-chain" scheme in the United States. Ultimately, in July 2007, Misulovin pleaded guilty before the Tel Aviv-Jaffa Magistrate's Court to the Israeli charges involving the use of false and forged documents, illegal possession of a firearm and money laundering. Misulovin was sentenced by the Israeli court to serve two years in prison, which he began to serve in Israel in March 2008.
Misulovin entered into a plea agreement with the United States in January 2008. As part of the agreement, Misulovin agreed to waive the pending extradition, and volunteered to participate in the International Prisoner Transfer Program. The program was formally established in 1977 when Congress passed enabling legislation and the United States entered into its first transfer treaty with Mexico. In 1985, the United States also acceded to the multilateral transfer convention, the Council of Europe Convention on the Transfer of Sentenced Persons (the COE Convention). Israel is also a signatory to the COE Convention. This allowed the United States and Israel to return Misulovin, who was sentenced and imprisoned in Israel, to the United States to serve the time remaining on his Israeli sentence. Misulovin’s case is the first time that a U.S. citizen was transferred from Israel under the COE Convention.
The case was investigated by the FBI’s Newark Division; the Internal Revenue Service-Criminal Investigation Division; the U.S. Department of Transportation’s Office of Inspector General; and the New Jersey Division of Taxation.
The prosecution of the case has been led by Deputy Chief Thomas P. Ott of the Criminal Division’s Organized Crime and Racketeering Section. The prosecution has received assistance from other federal and foreign authorities, including: the Tax Division’s Northern Criminal Enforcement Section; the U.S. Attorney’s Office for the District of New Jersey; the Criminal Division’s Office of Enforcement Operations, International Prisoner Transfer Unit; the Criminal Division’s Office of International Affairs; the Bureau of Prisons; the Israel Ministry of Justice; and the Israel Police, Unit for Serious and International Crime.
Ali Al-Marri Indicted for Providing Material Support to Al-QaedaRead the Press Release
WASHINGTON – A federal grand jury in the Central District of Illinois has returned a two-count indictment charging Ali Saleh Kahlah al-Marri, 43, with providing material support to al-Qaeda and conspiring with others to provide material support to al-Qaeda, Attorney General Eric Holder announced today.
The indictment was returned yesterday and unsealed this morning. If convicted, al-Marri, a dual national of Saudi Arabia and Qatar, faces a maximum penalty of 15 years imprisonment for each count of the indictment.
“This indictment shows our resolve to protect the American people and prosecute alleged terrorists to the full extent of the law,” said Attorney General Holder. “In this administration, we will hold accountable anyone who attempts to do harm to Americans, and we will do so in a manner consistent with our values.”
On Jan. 22, 2009, the President ordered the Attorney General to lead an interagency review of al-Marri’s case. Specifically, the President instructed the Attorney General, the Secretaries of State, Defense, and Homeland Security, as well as the Director of National Intelligence to conduct a review of the factual and legal basis for al-Marri’s continued detention, and to identify and thoroughly evaluate alternative dispositions for al-Marri.
After the indictment against al-Marri was returned, the President directed the Secretary of Defense to transfer, upon the request of the Attorney General, al-Marri from the custody of the Defense Department at the Naval Consolidated Brig in Charleston, S.C., to the custody of the Justice Department for purposes of criminal prosecution. The President’s memorandum supersedes a June 23, 2003 Presidential directive that ordered al-Marri detained as an enemy combatant by the Defense Department. The transfer will be accomplished once the U.S. Supreme Court rules on a motion that the Acting Solicitor General files later today.
In conjunction with the indictment announced today, the Justice Department’s Office of the Solicitor General will be moving to dismiss al-Marri’s pending litigation before the U.S. Supreme Court.
“We look forward to prosecuting this critically important case and thank the many investigators, analysts and prosecutors who worked tirelessly to make it possible,” said Matthew Olsen, Acting Assistant Attorney General for National Security and Executive Director of the Guantanamo Detainee Review Task Force.
“These charges remind us of the importance of vigilant law enforcement across the country working individually and together to protect Americans,” said FBI Director Robert S. Mueller, III. “It was important seven years ago, and even more important today.”
“The indictment alleges that Ali al-Marri provided material support to al-Qaeda, which has committed horrific terrorist acts against our nation,” said U.S. Attorney Rodger A. Heaton. “As a result, he will now face the U.S. criminal justice system, where his guilt or innocence will be determined by a jury in open court.”
Al-Marri entered the United States on Sept. 10, 2001, purportedly to pursue a second bachelor’s degree at Bradley University in Peoria, Ill. After having been detained in the Central District of Illinois, al-Marri was transferred to the Southern District of New York as a material witness in the investigation of the Sept. 11, 2001 attacks.
Al-Marri was charged with credit card fraud, false statements and identity fraud in the Southern District of New York. After al-Marri withdrew his waiver of venue, the court dismissed the charges and the government brought its case in the Central District of Illinois. On May 22, 2003, after being returned to the Central District of Illinois, al-Marri was indicted by a grand jury in that district. The May 2003 indictment alleged the same offenses that had been alleged previously in the Southern District of New York.
On June 23, 2003, al-Marri was designated by President Bush as an enemy combatant and transported from the Central District of Illinois to the Naval Consolidated Brig in Charleston, where he has been detained since. The criminal charges against al-Marri were dismissed with prejudice on the government's motion on June 23, 2003, prior to his transfer to South Carolina.
The al-Marri investigation was conducted by the FBI Joint Terrorism Task Force in Springfield, Ill. The case is being prosecuted by Trial Attorneys Joanna Baltes and John Gibbs of the Counterterrorism Section of the Justice Department’s National Security Division, and Assistant U.S. Attorney David E. Risley of the U.S. Attorney’s Office for the Central District of Illinois.
The public is reminded that the charges contained in an indictment are mere allegations and each defendant is presumed innocent unless and until convicted in a court of law.
26 February 2009
Stanford Financial Group Chief Investment Officer Charged with ObstructionRead the Press Release
WASHINGTON – Laura Pendergest-Holt, the chief investment officer of Houston-based Stanford Financial Group (SFG), was arrested today by agents of the FBI’s Houston Field Office on a criminal complaint charging her with obstruction of a proceeding before an agency of the United States, announced Acting Assistant Attorney General of the Criminal Division Rita M. Glavin and Special Agent in Charge of the Houston Division of the FBI, Andrew R. Bland, III.
Pendergest-Holt will make her initial appearance on Friday, Feb. 27, 2009, before U.S. Magistrate Mary Milloy at the federal courthouse in Houston.
According to the complaint, Pendergest-Holt met on Feb. 10, 2009, with representatives of the U.S. Securities and Exchange Commission (SEC) at the SEC’s Fort Worth, Texas, regional office based on an SEC subpoena. According to the complaint, the SEC summoned Pendergest-Holt to testify in its investigation into allegations that SFG and related companies, including the Stanford International Bank (SIB), had defrauded investors and account holders of an estimated $8 billion in deposits.
The complaint alleges Pendergest-Holt made several affirmative misrepresentations to the SEC in order to obstruct its investigation.
Specifically, the complaint alleges that Pendergest-Holt met with several SFG corporate officers in Miami during the week of Feb. 2, 2009, to prepare for her upcoming testimony before SEC staff scheduled a week later. Pendergast-Holt is alleged to have discussed with those corporate officers the SIB’s "Tier III" Portfolio, using a computer-generated pie chart she created. The complaint alleges that the pie chart reflected, among other things, a $1.6 billion loan to a shareholder from the Tier III Portfolio.
The complaint alleges that the following week, on Feb. 10, Pendergest-Holt, accompanied by an attorney, made several misrepresentations under oath to SEC investigators during her testimony, including her alleged failure to reveal that she had participated in the Miami preparation session with SFG corporate officers. Pendergest-Holt also allegedly misrepresented her own preparatory work for the testimony, saying she had met with no one other than the attorney as she worked to ready herself for the session with the SEC.
The complaint alleges further that Pendergest-Holt failed to reveal to the SEC investigators during the testimony session that she was a member of the SIB’s investment committee, or the extent of her knowledge of the bank’s Tier III Portfolio. The complaint also alleges that at no point did Pendergest-Holt reveal that the $1.6 billion loan had been discussed with corporate officers in Miami. When asked by investigators if she served on the SIB limited investment committee, Pendergest-Holt is alleged to have answered "no."
Pendergest-Holt was interviewed again by SEC investigators on Feb. 17, 2009, in Memphis, Tenn., and, according to the complaint, she continued to obstruct the SEC’s investigation by saying she had no knowledge of the Tier III Portfolio.
The complaint is merely an accusation based on a finding of probable cause by a magistrate judge, and the defendant has not been indicted by a grand jury. The defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by the FBI’s Houston Field Office, Internal Revenue Service-Criminal Investigations and the U.S. Postal Inspection Service. The case is being prosecuted by Trial Attorney Matthew Klecka with assistance from Allan Medina, Law Clerk, Forfeiture Support Associates, assigned to the Fraud Section.
Complaint
Ohio Man Sentenced to 20 Years for Terrorism Conspiracy to Bomb Targets in Europe and the United StatesRead the Press Release
WASHINGTON – Christopher Paul, a/k/a Abdul Malek, a/k/a Paul Kenyatta Laws, a 44-year-old U.S. citizen born in Columbus, Ohio, was sentenced to 20 years in prison today for conspiring with others to use a weapon of mass destruction, namely explosive devices, against targets in Europe and the United States.
The sentence, which was handed down by U.S. District Judge Gregory L. Frost in the Southern District of Ohio, was announced by Matthew G. Olsen, Acting Assistant Attorney General for National Security; Gregory G. Lockhart, U.S. Attorney for the Southern District of Ohio; Executive Assistant Director Arthur M. Cummings, II, of the FBI’s National Security Branch; and Keith L. Bennett, Special Agent in Charge of the FBI’s Cincinnati Division.
On June 3, 2008, Paul pleaded guilty to count two of a three-count indictment charging him with conspiracy to provide material support and resources to terrorists; conspiracy to use a weapon of mass destruction (explosives); and providing material support and resources to terrorists. At his guilty plea, Paul agreed to a sentence of 20 years in prison. The government agreed to dismiss counts one and three of the indictment.
"Today’s sentence brings an end to the long, militant career of Christopher Paul, an Ohio native who joined al Qaeda in the early 1990s, fought in Afghanistan and Bosnia and conspired with others to target Americans both at home and abroad," said Acting Assistant Attorney General Matthew Olsen. "His lengthy prison term demonstrates our continuing resolve to protect the American public against terrorism."
"The Paul case represents the culmination of extraordinary efforts by the FBI Joint Terrorism Task Force as a whole and, in particular, the JTTF Paul case agents: FBI Special Agent Latisha Hartsough, Westerville Police Detective Mike Shaheen, and Franklin County Sheriff’s Deputy Jerry Goetz. Without the JTTF’s efforts and those of our international law enforcement counterparts, this case would not have been possible," said U.S. Attorney Gregory G. Lockhart.
"Thanks to the work of the agents and officers at our Columbus Joint Terrorism Task Force, American-born Christopher Paul’s actions in support of al Qaeda were disrupted and exposed. Through our partnerships around the country, we will continue to investigate and bring to justice those like him who threaten the safety and welfare of American citizens," said Executive Assistant Director Arthur M. Cummings, II, of the FBI’s National Security Branch.
According to a statement of facts read by the case agent during the change of plea hearing for Paul in June 2008 and acknowledged to be true by the defendant:
In the early 1990s, Paul traveled to Pakistan and Afghanistan to join the mujahedeen. At an al Qaeda training camp in Afghanistan, he received initial training in, among other things, the use of assault rifles, rocket-propelled grenades, and small unit tactics. After successfully completing this training, he joined al Qaeda and stayed at the Beit ur Salam guesthouse, which was exclusively for al Qaeda members. Having distinguished himself to al Qaeda, Paul was then selected for and obtained advanced training in explosives, climbing, and military history. Paul then fought in Afghanistan alongside other mujahedeen.
After fighting in Afghanistan, Paul returned to Ohio, where he began instructing individuals in martial arts in Columbus. He also began recruiting local individuals with extremist intentions in order to establish a jihadist group in Ohio. Over time and through his association with al Qaeda, Paul became dedicated to committing jihad and furthering the objectives of al Qaeda and other radical Islamic fundamentalists.
From 1993 through 1995, Paul, using various passports and names, traveled to the Balkans in Europe and fought in conflict zones such as Bosnia, establishing further contact with radical Islamic fundamentalists, and creating a master list of al Qaeda leaders and other Islamic radicals worldwide. This list and bomb-making information was seized during the execution of a search warrant at the defendant’s home.
Paul returned to Columbus after fighting in the Balkans, and, in 1997, received a fax from two al Qaeda co-conspirators in Europe asking, on behalf of "the brothers," for Paul to find them a "true group and place to make jihad." While in Columbus, Paul conducted training operations in Burr Oak State Park in Ohio with several members of his local group, replicating terrorist training he had received in Afghanistan and Bosnia.
Preparing to travel again overseas, Paul obtained a new passport after claiming his old passport – in one of his other aliases – had been damaged by water. Beginning in March 31, 1999, and continuing through Jan. 31, 2000, Paul made 44 calls to an Islamic fundamentalist co-conspirator in Europe, who was arrested in 2003 and later convicted of a terrorist conspiracy.
On April 16, 1999, Paul traveled to meet with members of an Islamic terror cell in Germany, who knew him as an expert in bomb-making/detonation devices. In Germany, Paul provided explosives training to the cell knowing that it was planning to use this training to construct bombs, car bombs, and similar devices to be used against Americans while they vacationed at foreign tourist resorts. The German terrorist cell also planned to use bombs against Americans in the United States, and against U.S. facilities abroad, such as U.S. embassies, diplomatic premises and military bases in Europe.
Upon his return to Ohio from Germany, Paul had a member of his group in Columbus purchase a printer / scanner in May 1999. The printer/scanner was then sent to one of the German terror cell members in order to help the cell manufacture fraudulent documents to facilitate worldwide travel. The cell member did not claim the package in Germany and it was sent back to Paul. During this time, Paul also bought other equipment to be used by extremists, including night vision equipment and a laser range finder. Additional similar items were found during the execution of search warrants by the Columbus FBI Joint Terrorism Task Force. Furthermore, in November 1999, bank records show that Paul wire transferred $1,760 to one of the principal members of the German cell.
The Paul investigation was conducted by the Columbus FBI Joint Terrorism Task Force, a multi-agency operation led by the FBI that includes agents and officers from 10 federal, state and local law enforcement agencies.
The case was prosecuted by the U.S. Attorney’s Office for the Southern District of Ohio and the Justice Department’s National Security Division.
N.J. Electrical Company Employee Pleads Guilty to Defrauding the Environmental Protection Agency at Superfund SiteRead the Press Release
WASHINGTON — An employee of a Sewell, N.J., company that provided temporary electrical utilities pleaded guilty today to participating in a fraud conspiracy at an Environmental Protection Agency (EPA)-designated Superfund site in New Jersey, the Department of Justice announced today.
Christopher Tranchina pleaded guilty to a charge filed today in the U.S. District Court of New Jersey. Tranchina was charged with conspiracy to defraud the EPA at the Federal Creosote site, located in Manville, N.J. The clean up at the site is partly funded by the EPA.
Under an interagency agreement between the EPA and the U.S. Army Corps of Engineers, prime contractors oversaw the removal, treatment and disposal of contaminated soil, as well as other operations at the Federal Creosote site.
According to the charge, from approximately the Spring of 2001 until approximately June of 2005, Tranchina and other co-conspirators thwarted the competitive bidding process and defrauded the EPA by inflating Federal Creosote invoices and paying kickbacks to an employee of a prime contractor at Federal Creosote. In exchange for the kickbacks, Tranchina’s employer received sub-contracts at the site. The kickbacks totaled approximately $138,000. As a part of the conspiracy, Tranchina received approximately $23,000 of the kickbacks, in the form of a hot tub, an HVAC system, cash and checks.
"The Department of Justice will investigate and prosecute those who steal from the public by subverting the competitive bidding process, particularly where taxpayer dollars are involved," said Scott D. Hammond, Acting Assistant Attorney General in charge of the Department’s Antitrust Division.
On Dec. 15, 2008, as part of the same investigation, Bennett Environmental Inc. (BEI) also pleaded guilty to participating in a conspiracy to defraud the EPA, and was sentenced to pay a criminal fine in the amount of $1 million and restitution in the amount of $1.66 million. On that same day, Zul Tejpar, a former BEI employee, pleaded guilty to his participation in the conspiracy. In addition, on July 23, 2008, JMJ Environmental Inc., a Laurel Springs, N.J., wastewater treatment supply company, its owner John Drimak Jr., and Norman Stoerr, a former contracts administrator at the Federal Creosote site, pleaded guilty to related bid rigging charges at Federal Creosote. Drimak and Stoerr also pleaded guilty to fraud charges related to both the Federal Creosote site and another New Jersey Superfund site, Diamond Alkali in Newark, N.J. Drimak and Stoerr pleaded guilty to tax related charges as well. Tejpar, Drimak and Stoerr are currently awaiting sentencing.
The fraud conspiracy that Tranchina pleaded guilty to carries a maximum penalty of five years in prison, three years of supervised release and a $250,000 fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
Today’s charges 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 is being conducted by the Antitrust Division’s New York Field Office, the EPA Office of Inspector General and the Internal Revenue Service Criminal Investigation. Anyone with information concerning bid rigging, kickbacks, tax offenses or fraud relating to contracts awarded at Federal Creosote should contact the New York Field Office of the Antitrust Division at 212-264-9308.
Miami Man Found Guilty in $13.5 Million International Money Laundering SchemeRead the Press Release
WASHINGTON – Rodrigo Molina, 33, a Brazilian national who resided in Miami, was found guilty by a federal jury on 11 of 16 charged counts related to a $13.5 million money laundering conspiracy, Acting Assistant Attorney General Rita M. Glavin of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida announced.
Molina was found guilty on Feb. 25, 2009, following a seven-day jury trial in U.S. District Court for the Southern District of Florida. The indictment also charged Marcos Neto Macchione, 32, a Brazilian national residing in Avenura, Fla. Macchione pleaded guilty in June 2008 to the conspiracy to launder $13.5 million in fraud proceeds. The indictment followed the arrests of Molina and Macchione in Florida as well as 18 individuals in Brazil, including the alleged leader of this criminal organization, Doron Mukamal, as well as his partners, associates and employees. Molina and Macchione were responsible for laundering the funds illegally obtained through the telemarketing scheme.
According to evidence presented at trial, the leaders of the Brazilian telemarketing scheme (the Brazilian defendants) offered to purchase nearly worthless stock from foreign investors by offering them much more than the stocks were worth. The Brazilian defendants used well-designed Web sites to mislead their victims into believing that they were legitimate securities brokers. In order to carry out their scheme, the Brazilian defendants stole the identities of real U.S. broker dealers and created others that were fictitious. In many instances, the Brazilian defendants even created false governmental entities that touted the legitimacy of the fictitious brokers. Additionally, Voice Over Internet Protocol (VoIP) telephone providers were used so that the fictitious brokers had U.S. phone numbers even though they were located in Brazil and other countries.
Trial evidence showed that shortly before the purported stock transactions were to take place, the Brazilian defendants would require the victims to pay various advance fees that purportedly were needed to pay for taxes, escrow payments or other services not actually required in legitimate transactions. Once these "fees" were wired into bank accounts, mostly located in Miami, the Brazilian defendants simply abandoned the transactions and the victims lost their money. Molina and Macchione laundered the money through bank accounts in the United States.
Molina faces a maximum sentence of 20 years in prison on five counts of money laundering, 10 years on an additional five counts of money laundering, and twenty years on the conspiracy charge, in addition to possible fines and terms of supervised release.
In February 2009, Macchione was sentenced to 70 months in prison, two years of supervised release, and ordered to forfeit bank accounts containing approximately $1.8 million in criminal proceeds.
The case was prosecuted by Deputy Chief Steve Linick and Trial Attorney Matthew A. Klecka of the Criminal Division’s Fraud Section. The case was investigated by the FBI, U.S. Postal Inspection Service, New Jersey Bureau of Securities, New Jersey Division of Criminal Justice and the U.S. Securities and Exchange Commission.
Justice Department Settles Lawsuit Against the City of Dayton, Ohio, Alleging Discrimination Against African Americans in the Hiring of Police Officers and FirefightersRead the Press Release
WASHINGTON - The Department of Justice announced today that it has entered into a consent decree with the city of Dayton that, if approved by the court, will resolve the Department’s complaint that Dayton has been engaged in a pattern or practice of discrimination against African-Americans in its hiring of entry-level police officers and firefighters, in violation of Title VII of the Civil Rights Act of 1964 (Title VII).
Title VII prohibits discrimination in employment on the basis of race, color, sex, national origin or religion. Title VII prohibits not only intentional discrimination, but also the use of employment practices (e.g. written examinations and qualification standards), which result in disparate impact, unless the employer can prove that such practices are job related and consistent with business necessity.
The United States’ complaint, filed in the U.S. District Court for the Southern District of Ohio in September 2008, alleges that Dayton’s use of an internally created written examination for screening entry-level police officer applicants, and its use of heightened minimum qualifications for entry-level firefighter applicants, i.e. requiring that applicants have EMT-Basic and Firefighter I and II certifications at the time they apply, resulted in disparate impact on African-Americans. The complaint also alleges that neither practice has been demonstrated by the city of Dayton to be job related and consistent with business necessity, in accordance with the requirements of Title VII. According to the complaint, although the civilian labor force of Dayton is approximately 37 percent African-American, only approximately nine percent of the city’s sworn police officers and less than 3 percent of its sworn firefighters are African–American. In fact, according to the complaint, the percentage of African-Americans in the city’s fire department actually decreased from 7 percent in 1984 to less than 3 percent in 2008.
The consent decree requires that the city of Dayton no longer use the selection practices challenged in the complaint for screening and hiring police officers and firefighters, and requires that the city develop new selection procedures for hiring police officers and firefighters that comply with Title VII. Additionally, the consent decree requires that the city of Dayton pay $450,000 into a settlement fund that will be used to make awards of back pay to African-Americans who were harmed by the selection practices challenged by the United States and who are determined to be eligible for relief. Four African-Americans who passed the city’s written police officer examination, but whose hiring was delayed due to the city’s rank-order use of the written examination scores, will each be offered $18,900 from the settlement fund, retroactive seniority for all purposes except for time-in-grade required for promotion, and the opportunity to receive retroactive pension credit. Additional African-Americans determined to be eligible for relief under the consent decree may receive a priority offer of employment from the city, a monetary award of back pay from the settlement fund, retroactive seniority for all purposes except for time-in-grade required for promotion and/or retroactive pension credit. The consent decree requires the city of Dayton to hire up to five eligible African-American claimants as police officers and up to nine eligible African-American claimants as firefighters. Under the decree, Dayton maintains the opportunity to screen the claimants eligible for consideration for priority hire to ensure that they meet the lawful qualifications for the positions required of all other police officers and firefighters.
"This settlement agreement sends a clear message that hiring practices that have discriminatory impact on account of race will not be tolerated," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Department commends the city of Dayton for working cooperatively to resolve this case without protracted litigation, to put in place new selection practices for police officers and firefighters that comply with Title VII and to provide relief to those African-Americans who have been harmed by the city’s hiring practices challenged by the Department."
According to the complaint, approximately 68 percent of white candidates, but only approximately 29 percent of African-American candidates, passed the city of Dayton’s most recent written police officer examination; and the scores of passing African-American candidates on that exam were lower than those of their white counterparts. In addition, of the 60 police officers the city appointed from the eligibility list that resulted from is most recent police officer examination, only four, or less than seven percent, were African-American.
The complaint also alleges that, since 2004, when the city began requiring that firefighter applicants have Emergency Medical Technician-Basic and Firefighter I and Firefighter II certifications to be considered for hire, the percentage of African-American applicants dropped significantly. While African Americans comprised 20 percent of all firefighter applicants in 2000, and approximately 25 percent of all firefighter applicants in 2002, African-Americans comprised only about 6 percent of all firefighter applicants to take the city’s most recent written firefighter examination, which was administered in 2005.
More information about Title VII and other federal employment laws is available on the Department of Justice Web site at http://www.usdoj.gov/crt/emp/index.html
Iraqi-Born Dutch Citizen Pleads Guilty to Terrorism Conspiracy Against Americans in IraqRead the Press Release
WASHINGTON – An Iraqi-born Dutch citizen today pleaded guilty to conspiring with others to murder Americans overseas, including by planting roadside bombs targeting U.S. soldiers in Fallujah, Iraq, and by demonstrating on video how these explosives would be detonated to destroy American vehicles and their occupants.
The guilty plea by Wesam al-Delaema, a/k/a Wesam Khalaf Chayed Delaeme, age 36, was announced today by Matthew G. Olsen, Acting Assistant Attorney General for National Security; Jeffrey A. Taylor, U.S. Attorney for the District of Columbia; and Joseph Persichini Jr., Assistant Director in Charge of the Federal Bureau of Investigation (FBI) Washington Field Office.
At a hearing today before U.S. District Court Judge Paul Friedman, al-Delaema entered a plea of guilty to count one of a six-count indictment returned in U.S. District Court for the District of Columbia in September 2005. Specifically, al-Delaema pleaded guilty to conspiracy to murder U.S. nationals outside the United States.
Separately, al-Delaema has also agreed to plead guilty next week in Superior Court for the District of Columbia to one count of aggravated assault for a December 2007 incident at the D.C. jail in which he kicked a prison guard to the point of unconsciousness while the guard was prone on the ground. The guard sustained significant injuries, including a subdural hemorrhage. Al-Delaema was indicted for this offense in Superior Court for the District of Columbia in November 2008.
The Justice Department and al-Delaema have agreed upon a sentence of 25 years imprisonment for the offense of conspiracy to murder U.S. nationals overseas and a concurrent sentence of 18 months imprisonment for the offense of aggravated assault. Sentencing has been set for April 15, 2009. According to an agreement between the United States and the Netherlands, al-Delaema will serve out his sentence in the Netherlands.
According to the plea agreement and factual proffers filed in court, between October 2003 and May 2, 2005, al-Delaema entered into an agreement with several co-conspirators to murder U.S. nationals in Iraq. As part of the conspiracy, al-Delaema travelled to Fallujah in October 2003. There, al-Delaema and his co-conspirators -- calling themselves the "Mujahideen from Fallujah" -- declared their intentions to kill Americans in Iraq using improvised explosive devices (IEDs).
As part of the conspiracy, al-Delaema and his co-conspirators discussed and demonstrated, on video, the way in which the IEDs they had buried in a road near Fallujah would be detonated and would destroy American vehicles driving on the road and kill the American occupants of those vehicles.
In one statement on video, al-Delaema stated, "We will show you, in a short while, the site where we hide the mines and how the operation is conducted. The operation will be carried out, if Allah wills, today, and if they come. This is not the first operation we carry out. We have executed several operations and most of them were successful. The American Army wouldn’t admit to casualties. Their casualties have gone beyond our imagination. In Fallujah alone, they lost hundreds."
Later in the same video, al-Delaema and a co-conspirator demonstrated the components of an IED buried in the road.
According to the factual proffer that he agreed to, al-Delaema not only created "how-to" and recruitment videos, but also filmed the effects of roadside attacks in Iraq. Furthermore, after his return to the Netherlands, al-Delaema continued to attempt to obtain propaganda videos for those seeking to kill Americans in Iraq, frequently attempting to obtain raw footage of attacks on Americans in Iraq.
Finally, in May 2005, al-Delaema possessed video images of himself and his co-conspirators documenting their intentions to kill Americans in Iraq and their acts in furtherance of their conspiracy, including hiding the roadside bombs near Fallujah. He also possessed that day additional edited videos of attacks on Americans.
Al-Delaema was arrested by Dutch law enforcement authorities on May 2, 2005, and he initially faced similar charges in that country. Following his arrest, Dutch law enforcement and prosecution authorities worked cooperatively with the FBI in its investigation of al-Delaema’s terrorist activities.
In September 2005, the United States filed a formal request with the Netherlands seeking al-Delaema’s extradition. The extradition request was subsequently granted by a Dutch court and then by the Dutch Ministry of Justice. In December 2006, the extradition request was sustained on appeal in the Netherlands. In January 2007, al-Delaema was flown to the United States, arrested and taken into custody by the FBI.
"Today’s guilty plea is the culmination of the first prosecution in the United States charging terrorist activities in Iraq. Al-Delaema now faces justice for his efforts to orchestrate roadside bomb attacks against our men and women serving in Iraq. We are honored to play a role in prosecuting those involved in such attacks," said Matthew G. Olsen, Acting Assistant Attorney General for National Security.
"Today's plea demonstrates our continued vigilant efforts to track down and bring to justice terrorists who plot attacks on our citizens, particularly our brave military men and women serving in Iraq," stated U.S. Attorney Jeffrey A. Taylor. "We hope this sends a message to others plotting to harm our citizens that we will use every tool at our disposal to defend Americans, both at home and abroad."
"Investigations of terrorists traveling to and from Iraq and Afghanistan to conduct anti-coalition attacks can only be accomplished through the close cooperation between the FBI and our foreign law enforcement partners," said FBI Assistant Director in Charge Joseph Persichini Jr. "The FBI had the extreme good fortune to work with the Dutch KLPD in this terrorism investigation and we look forward to continued cooperation with The Netherlands and other members of the International Law Enforcement community in fighting the global war on terror."
The investigation into this matter was conducted by the FBI’s Washington Field Office, with assistance from the Dutch National Police Agency and the National Office of the Public Prosecutor in the Netherlands. The Office of International Affairs in the Criminal Division of the U.S. Department of Justice coordinated the extradition efforts on behalf of the United States.
The prosecutors handling the case are Assistant U.S. Attorneys Gregg Maisel and Rachel Lieber of the U.S. Attorney’s Office for the District of Columbia, and Trial Attorney David Miller of the Counterterrorism Section of the Justice Department’s National Security Division.
Former Cartel Leader Extradited from MexicoRead the Press Release
WASHINGTON - Miguel Caro Quintero, the alleged former leader of the now-defunct Sonora Cartel, was extradited by the government of Mexico to the United States on Feb. 25, 2009, the Justice Department announced today.
Miguel Caro Quintero arrived in the United States yesterday and has been transferred to the District of Colorado to face charges including racketeering and narcotics trafficking. Miguel Caro Quintero made his initial appearance this afternoon in U.S. District Court for the District of Colorado. Charges are also pending against Miguel Caro Quintero in the District of Arizona. Prior to his extradition, Miguel Caro Quintero was serving a prison sentence in Mexico for drug-related crimes.
The Sonora Cartel, a former drug trafficking organization based in Mexico, was responsible for exporting to the United States and distributing multi-ton quantities of marijuana during the 1980s and 1990s. Caro Quintero and his older brother, Rafael Caro Quintero, were identified as significant foreign narcotics traffickers under The Kingpin Act in June 2000, subjecting them and their associates to economic sanctions. Rafael Caro Quintero was accused of being the mastermind behind the kidnapping and murder of DEA Special Agent Enrique Camarena in 1985 and was prosecuted by the government of Mexico.
"The extradition of former kingpin Miguel Caro Quintero who reigned with impunity for too long is a victory for citizens of both the United States and Mexico," said DEA Acting Administrator Michele M. Leonhart. "After serving time in a Mexican prison, Caro Quintero will now answer for his crimes with the one consequence kingpins fear most: extradition to the United States. DEA will continue to work with our courageous Mexican counterparts in our relentless pursuit to bring the highest level drug traffickers to justice."
The District of Colorado case is being prosecuted by attorneys from the U.S. Attorney’s Office in the District of Colorado. The charges in the District of Arizona are being prosecuted by attorneys from the Criminal Division’s Narcotic and Dangerous Drug Section. The Criminal Division’s Office of International Affairs provided significant assistance in the extradition of Miguel Caro Quintero.
An indictment is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Department of Justice FY 2010 Budget RequestRead the Press Release
WASHINGTON – The President released the Administration’s FY 2010 top-line budget proposal today which includes $26.5 billion for the Department of Justice (DOJ), a 3.5 percent increase more than the FY 2009 budget. The Department’s budget includes enhanced funding for: national security and intelligence; combating financial fraud; hiring additional police officers; civil rights enforcement; securing our nation’s borders; and for federal detention and incarceration programs.
"The President has promised that, from the day he took office, America will have a Justice Department that is truly dedicated to justice," said Attorney General Holder. "This budget supports this vital task by investing in our critical law enforcement mission, including protecting Americans from terrorism, fighting financial and mortgage fraud, getting more cops on the beat, reinvigorating civil rights enforcement, and providing essential resources for our prisons."
Funding Highlights:
Counters the Threat of Terrorism and Strengthens National Security – Provides $8 billion for the FBI, including $425 million in enhancements, and $88 million for the National Security Division to address the Attorney General’s highest priority – protecting Americans from terrorist acts. Funding supports the detection and disruption of terrorists, counterintelligence, cyber security, and other threats against our national security.
Combats Financial Fraud – Provides resources for additional FBI agents to investigate mortgage fraud and corporate crime and for additional federal prosecutors, civil litigators and bankruptcy attorneys to protect investors, the integrity of the market, and the federal government’s investment of resources in the nation’s financial recovery.
Begins to Put 50,000 More Cops on the Beat – Expands the Community Oriented Policing Services (COPS) program by providing funds to begin hiring 50,000 additional police officers. Supports the hiring of police nationwide in order to help states and communities prevent the growth of crime.
Enhances Federal Civil Rights Enforcement – Includes $145 million for the Civil Rights Division to strengthen civil rights enforcement against racial, ethnic, sexual preference, religious and gender discrimination.
Strengthens Immigration Enforcement and Border Security – Includes resources for a comprehensive approach to enforcement along our borders that combines law enforcement and prosecutorial component efforts to investigate arrest, detain, and prosecute illegal immigrants and other criminals. The initiative also enhances the Department’s ability to track fugitives from justice and combat gunrunners and illegal drug traffickers.
Supports Federal Detention and Incarceration Programs – Provides $6 billion for the Bureau of Prisons and $1.4 billion for the Office of the Detention Trustee to ensure that sentenced criminals and detainees are housed in facilities that are safe, humane, cost-efficient, and secure.
Expands Prisoner Reentry Programs – Includes $109 million for prisoner reentry programs, including an additional $75 million for the Office of Justice Programs to expand grant programs authorized by the Second Chance Act that provide counseling, job training, drug treatment, and other transitional assistance to former prisoners.
Enhances Financial Accountability in the Department of Justice – Provides funds for continuing the phased implementation of the Unified Financial Management System. This initiative will unify and standardize the Department’s financial, accounting and procurement systems and processes to improve the efficiency and integrity of these functions.
Due to the Presidential transition, the President is releasing the FY 2010 budget request in two parts. The first submission, today, provides the top-line request for each agency, including the Department of Justice. The second submission, in April, will consist of detailed budget proposals and traditional congressional justification materials. The details of the Department of Justice FY 2010 budget request will be finalized in the coming weeks, and the Administration’s proposals will be released in April.
Today’s top-line budget proposal builds upon the recent funding the Department received as a result of the American Recovery and Reinvestment Act of 2009 (H.R.1). The Department received $4 billion in 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.
17 Members and Associates of Violent Gang IndictedRead the Press Release
WASHINGTON – A federal grand jury in Lubbock, Texas, has charged 17 members and associates of the violent gang known as the Almighty Latin King and Queen Nation (ALKQN) with various charges related to their alleged narcotics and weapons trafficking violations, a well as a variety of alleged violent crimes throughout Texas, Acting Assistant Attorney General of the Criminal Division Rita M. Glavin and Acting U.S. Attorney for the Northern District of Texas James T. Jacks announced today.
Four of the 17 defendants were arrested last night and today in Lubbock, Midland, Big Spring, and Mission, Texas, as well as in Chicago. Eleven defendants are already in federal or state custody on related and unrelated charges. Two are considered fugitives. The defendants arrested today will make their initial appearance in Abilene, Texas, before U.S. Magistrate Philip R. Lane, on Friday, Feb. 27, 2009.
The 11-count indictment, returned earlier this month and unsealed today, charges each of the defendants with conspiracy to distribute and possession with intent to distribute cocaine and marijuana. Three defendants are also charged with conspiring to deal in firearms. The indictment also includes drug distribution charges and various firearms charges, including using and carrying a firearm to commit murder during and in relation to a drug trafficking crime.
"The message this indictment sends not just to these defendants but to those who support and participate in gangs is that with the cooperation of our law enforcement partners at the federal, state and local level, we will work tirelessly to protect our communities and punish those who seek to corrupt them through violence and gun and drug trafficking," said Acting Assistant Attorney General of the Criminal Division Rita M. Glavin.
Acting U.S. Attorney Jacks said, "Regardless of what dramatic name they attached to their group, criminal gangs are just that – criminals. Like most criminals, their illegal activities of drug dealing and engaging in violent crime are a cancer on our communities; communities comprised of honest, hard working people who are simply trying to earn a living, raise their families and live in peace. As evidenced by this action, law enforcement is committed to removing that cancer through determined investigative effort and the cooperation of local, state and federal law enforcement agencies as was done in this case. All of these agencies, with the help and support of the community, will continue to pursue these groups until they are no longer a part of our environment."
The defendants arrested today are:
- Jesus Martinez, a/k/a Solid, 28, of Midland
- John Guzman, 30, of Big Spring
- Hiluterio Chavez, a/k/a Zeus, 33, of Chicago
Eliseo Perez, a/k/a Wicked, 28, of Mission, Texas was arrested Wednesday night.
Defendants indicted but not yet arrested are:
- Guerrero Olivas, a/k/a Screech, 26, of Big Spring
- Michael Conde, a/k/a Psycho, 21, of Lubbock
- Defendants previously arrested include:
- Jose Robledo Nava, a/k/a Chino, 30, of Lubbock
- Luis Nava, a/k/a Flaco, 25, of Midland
- Reynaldo Nava, a/k/a Rat, 27, of Big Spring
- Robert Allen Ramirez, a/k/a Nesyo, 27, of Big Spring
- Marie Chavez, a/k/a Shorty, 28, of Lubbock
- Carol Ann Rivas Nava, 20, of Big Spring
- Cecily Dominique Juarez, 20, of Midland
- James Jonathan Cole, a/k/a Blitz, 19, of Lamesa, Texas
- Eduardo Daniel Mares, a/k/a Pitt, 21, of Seminole, Texas
- Gabriel Lee Gonzales, 21, of Fort Stockton, Texas
- David Hellums, a/k/a CutThroat, 35, of Big Spring
The indictment alleges that from 2001 until Dec. 13, 2008, when six of the defendants were arrested, the defendants, as members of the ALKQN, conspired to distribute multi-kilogram quantities of cocaine and marijuana throughout Texas and elsewhere. They acquired, packaged, stored, and transported the cocaine and marijuana, and according to court documents filed in the case, imported the narcotics from Mexico into the South Texas region, and then on to Big Spring, Lubbock, and Midland for further distribution. In furtherance of their conspiracy, one or more of the defendants is alleged to have committed numerous acts of violence, including murder, aggravated assault and arson.
During part of the time of the conspiracy, from 2004 through mid-July 2005, defendants Jose Robledo Nava, Jesus Martinez, and Hiluterio Chavez are alleged to have conspired to deal in firearms. They allegedly acquired the firearms, stored and transported them, and traded them for cocaine. Court documents filed in the case allege that the defendants illegally transported and trafficked the firearms throughout Texas and Chicago.
Jose Robledo Nava is allegedly the ALKQN leader in Texas. He, along with James Johnathan Cole, Robert Allen Ramirez, Gabriel Lee Gonzales and Eduardo Daniel Mares are charged in the indictment with the May 4, 2008, murders of Valerie Garcia and Michael Cardona, in Big Spring.
According to an affidavit supporting a criminal complaint filed in the case, on May 4, 2008, Jose Nava allegedly directed James Cole and Robert Ramirez to go in two vehicles to conduct a drive-by shooting on their rivals. Robert Ramirez was to be the passenger in the lead vehicle to confirm the targets, and James Johnathan Cole, armed with an AK-47, was to be the shooter in the following vehicle, which was to be driven by Gabriel Lee Gonzales.
With Ramirez and Eduardo Daniel Mares in the lead vehicle and Cole and Gonzales following in the second vehicle, after Ramirez and Mares passed the house of the rival gang members, Ramirez allegedly called Gonzales’ cell phone and conveyed Jose Nava’s previous order to him. The shooter fired into a crowd of people, striking six persons, including a pregnant woman and a three-year-old girl. Two of those victims, the pregnant woman and one of three men shot, died of their wounds.
The affidavit states that Ramirez, Mares, Cole and Gonzales then allegedly drove the two vehicles to a body shop where Cole retrieved the spent AK-47 shell casings and discarded them. Cole, Ramirez and Mares then drove to a fellow ALKQN residence where Cole admitted shooting the AK-47 and killing at least one person at the residence where the narcotics trafficking rivals were located.
An indictment is merely an accusation by a federal grand jury and a defendant is entitled to the presumption of innocence unless proven guilty. However, if convicted, defendants Nava, Cole, Ramirez, Gonzales and Mares each face a maximum statutory sentence of death or life in prison. The remaining defendants face a maximum statutory sentence of life in prison and a fine of up to $4 million.
While stating the investigation is ongoing, acting U.S. Attorney Jacks praised the excellent investigative efforts of the Organized Crime Drug Enforcement Task Force, the Midland and El Paso U.S. Attorney’s Offices, DEA, FBI, ICE, ATF, U.S. Marshals Service, Texas Department of Public Safety, Lubbock Police Department, Lubbock County Sheriff’s Office, Midland Police Department, Houston Police Department, Big Spring Police Department, and the Howard County District Attorney’s Office.
Assistant U.S. Attorney Cody L. Skipper of the Lubbock U.S. Attorney’s Office and Trial Attorney Joseph A. Cooley of the Department of Justice’s Criminal Division’s Gang Unit are prosecuting the case.
Indictment
25 February 2009
United States Sues to Stop Florida Tax Return Preparer from Claiming Allegedly Bogus Tax CreditsRead the Press Release
WASHINGTON - The United States has sued Robert Cusenza, a West Palm Beach tax return preparer, seeking to bar him permanently from the tax preparation business, the Justice Department announced today. The government’s complaint asks the court to order Cusenza to stop preparing returns and to turn over his customer list to the Justice Department.
According to the government complaint, Cusenza, who operates C R Insurance Agency Inc., has prepared tax returns claiming nearly $200,000 in false fuel tax credits alone. The complaint also alleges that Cusenza prepared returns that fabricated his customers’ income and/or expenses in order to maximize the earned income tax credit and obtain refunds for his customers.
The fuel tax credit is a credit available only to taxpayers who operate farm equipment or other off-highway business vehicles. The equipment or vehicles must not be registered for highway uses; meaning, that fuel purchased by truck drivers and companies for commercial transport does not qualify. The government complaint alleges that Cusenza fraudulently claims this credit for highway drivers who are not qualified to receive the credit. Moreover, according to the complaint, Cusenza claimed absurdly large credits for his customers by falsely reporting purchases of huge quantities of gasoline. For example, the complaint asserts that Cusenza claimed that one customer purchased 48,000 gallons of gasoline for "off-highway business use of gasoline" and "other nontaxable use of gasoline." The complaint further asserts that, assuming $2.00 per gallon, the customer would have had to spend approximately $96,000 to purchase that amount of gasoline, despite reporting only $12,012 in income.
The complaint also alleges that Cusenza claimed a variety of other bogus deductions, like home mortgage interest. On one return, detailed in the complaint, Cusenza claimed that a husband and wife who collectively made $17,878 in wages and $780 in business income had the means to pay and were entitled to deduct $2,132,287 in interest on their home mortgage.
Over the past decade, the Justice Department has obtained injunctions against more than 375 tax return preparers and tax-fraud promoters. Information about the Justice Department’s Tax Division and its efforts to enjoin tax return preparers and tax-fraud promoters is available on the Justice Department Web site.
United States Sues to Shut Down Florida Tax Return PreparerRead the Press Release
WASHINGTON - The United States has filed suit against a Jacksonville, Fla., tax return preparer, seeking to shut down her business, the Justice Department announced today. According to the government complaint, Shirley Clark, who operates the Nichet Corp., has prepared at least 1,250 federal tax returns for her customers from 2004 until 2007 and, on those returns, Clark has claimed nearly $750,000 in fraudulent fuel tax credits. The complaint also alleges that Clark prepared returns that fabricated her customers’ income and expenses in order to fraudulently maximize the earned income tax credit (EITC).
The fuel tax credit is a credit available only to taxpayers who operate farm equipment or off-highway business vehicles. The complaint alleges that Clark fraudulently claims this credit for truck drivers who are not qualified to receive the credit. Moreover, the complaint asserts that Clark claimed absurdly large credits by falsely reporting purchases of huge quantities of gasoline; in most cases, the cost of the gasoline was more than the customers’ annual income.
Clark, according to the complaint, also fabricated earned income and/or expenses for her customers in order to attain the "sweet spot" and improperly maximize their earned income tax credit. As an example, the complaint details how Clark engaged in a pattern of using fabricated beauty salon or beautician income on Schedules C to hit the EITC sweet spot. The complaint asserts that Clark listed business income for fake salons that purportedly had no cost of goods sold and no expenses. In most cases, according to the complaint, without the fake earned income and/or expenses, her customers would not have earned enough to qualify for the earned income tax credit.
The complaint asks the court to order Clark to stop preparing returns and to turn over her customer list to the Justice Department. In the past decade, the Justice Department has obtained injunctions against more than 375 tax return preparers and tax-fraud promoters. Information about the Justice Department’s Tax Division and its efforts to enjoin tax return preparers and tax-fraud promoters is available on the Justice Department Web site.
United States Files Complaint Against Forest Laboratories for Allegedly Violating the False Claims ActRead the Press Release
WASHINGTON – A Complaint was unsealed today in U.S. District Court in Massachusetts against a New York pharmaceutical company for alleged False Claims Act violations arising from the company’s marketing the drugs Celexa and Lexapro for unapproved pediatric use and for paying kickbacks to induce physicians to prescribe the drugs.
Acting Assistant Attorney General Michael F. Hertz; United States Attorney Michael J. Sullivan; Warren T. Bamford, Special Agent in Charge of the Federal Bureau of Investigation - Boston Field Division; Susan J. Waddell, Special Agent in Charge of Health and Human Services - Office of Inspector General, Office of Investigations; Mark Dragonetti, Resident Agent in Charge of the Food and Drug Administration, Office of Investigations - Office of Inspector General; and Jeffrey Hughes, Special Agent in Charge of the Northeast Field Office of the Veterans Affairs Office of the Inspector General, announced that the civil Complaint against Forest Laboratories Inc., of New York, New York, alleged that the company’s illegal promotional practices surrounding its antidepressant drugs Celexa and Lexapro caused thousands of false and fraudulent claims to be submitted to federal health care programs.
The Complaint alleges that a double-blind, placebo-controlled, pediatric trial found Celexa no more effective than the placebo for pediatric use and that, in the study, more patients taking Celexa attempted suicide or reported suicidal thoughts than those in the group taking the placebo. The negative efficacy data led the FDA to deny Forest’s request to approve Celexa for pediatric use. It is further alleged that, despite the FDA’s denial of a pediatric indication, Forest actively promoted pediatric use of the drugs and misled physicians and the public by failing to disclose the results of the negative study. The same study was among those later considered by the FDA when it mandated that Forest add a "black box" warning to both the Celexa and Lexapro labels.
The Complaint alleges that Forest sought to induce physicians and others to prescribe Celexa and Lexapro by providing them with various forms of illegal remuneration, including cash payments disguised as grants or consulting fees, expensive meals and lavish entertainment and other valuable goods and services, all in violation of the federal anti-kickback statute.
Neither Medicaid nor TRICARE ordinarily cover drugs for off-label uses unless the off-label use is for a medically accepted indication. The United States alleges that federal health care programs have paid thousands of false and fraudulent claims for Celexa and Lexapro prescriptions that were not covered for off-label pediatric use and/or were ineligible for payment as a result of illegal kickbacks paid by Forest.
Prior to filing its Complaint, the government had intervened in two separate whistleblower actions against Forest that had been commenced under the qui tam provisions of the False Claims Act. The False Claims Act allows for private persons to file whistleblower suits to provide the government information about wrongdoing. Under the statute, if it is established that a person has submitted or caused others to submit false or fraudulent claims to the United States, the government can recover treble damages and $5,500 to $11,000 for each false or fraudulent claim filed. If the Government is successful in resolving or litigating its claims, a proper whistleblower can receive a share of between 15 percent and 25 percent of the amount recovered.
This investigation was conducted by the U.S. Attorney’s Office for the District of Massachusetts, the Civil Division of the U.S. Department of Justice, the Federal Bureau of Investigation, the Office of Inspector General of the Department of Health and Human Services, the Office of Criminal Investigations of the Food and Drug Administration and the Office of Inspector General of the Department of Veteran’s Affairs.
Justice Department Settles Lawsuit Alleging Military Discrimination Against the North Carolina Administrative Office of the Courts and Senior Resident Court JudgeRead the Press Release
WASHINGTON – The Justice Department announced today that it has reached a settlement that, if approved by the court, will resolve a lawsuit filed by the Department against the Administrative Office of the Courts of the State of North Carolina and the Honorable Jerry Braswell, Senior Resident Superior Court Judge for North Carolina Judicial District 8-B, in his official capacity.
The complaint, filed by the Department on Nov. 14, 2008, in U.S. District Court in Raleigh, N.C., alleged that the defendants discriminated against former magistrate James L. Myles when they failed to reappoint Myles to an additional term as a magistrate due to his service in the U.S. Army Reserve, in violation of the Uniformed Services Employment and Reemployment Rights Act in 1994 (USERRA). USERRA prohibits employment discrimination against individuals because of their service or service obligation in the uniformed services. Under the terms of the settlement, the defendants are required to pay Myles a monetary award of $12,000 that includes back pay.
"The Department demonstrates again with this settlement that it will vigorously defend the rights of service members to be free from discrimination based on their military service and obligation," said Acting Assistant Attorney General Loretta King of the Civil Rights Division.
The Justice Department’s lawsuit was filed after receiving Myles’s complaint from the Veterans’ Employment and Training Service of the Department of Labor (DOL), upon completion of its investigation.
The Department’s Civil Rights Division places a high priority on the enforcement of service members’ rights under USERRA. Additional information about USERRA can be found on the Department of Justice Web site at: http://www.servicemembers.gov, and on the DOLWeb site at: http://www.dol.gov/vets/programs/userra/main.htm.
Hundreds of Alleged Sinaloa Cartel Members and Associates Arrested in Nationwide Takedown of Mexican Drug TraffickersRead the Press Release
WASHINGTON – Today Attorney General Eric H. Holder Jr., announced the arrest of more than 750 individuals on narcotics-related charges and the seizure of more than 23 tons of narcotics as part of a 21-month multi-agency law enforcement investigation known as "Operation Xcellerator." The Attorney General was joined in announcing the current results of Operation Xcellerator by DEA Acting Administrator Michele M. Leonhart.
Today, 52 individuals in California, Minnesota and Maryland were arrested as part of Operation Xcellerator, which targeted the Sinaloa Cartel, a major Mexican drug trafficking organization, through coordination between federal, state and local law enforcement, as well as cooperation with authorities in Mexico and Canada.
The Sinaloa Cartel is responsible for bringing multi-ton quantities of narcotics, including cocaine and marijuana, from Mexico into the United States through an enterprise of distribution cells in the United States and Canada. The Sinaloa Cartel is also believed to be responsible for laundering millions of dollars in criminal proceeds from illegal drug trafficking activities. Individuals indicted in the cases are charged with a variety of crimes, including: engaging in a continuing criminal enterprise by violating various felony provisions of the Controlled Substances Act; conspiracy to import controlled substances; money laundering; and possession of an unregistered firearm.
"International drug trafficking organizations pose a sustained, serious threat to the safety and security of our communities," said Attorney General Holder. "As the world grows smaller and international criminals step up their efforts to operate inside our borders, the Department of Justice will confront them head on to keep our communities safe."
To date, Operation Xcellerator has led to the arrest of 755 individuals and the seizure of approximately $59.1 million in U.S. currency, more than 12,000 kilograms of cocaine, more than 16,000 pounds of marijuana, more than 1,200 pounds of methamphetamine, more than 8 kilograms of heroin, approximately 1.3 million pills of Ecstasy, more than $6.5 million in other assets, 149 vehicles, 3 aircraft, 3 maritime vessels and 169 weapons.
"We successfully concluded the largest and hardest hitting operation to ever target the very violent and dangerously powerful Sinaloa drug cartel," said DEA Acting Administrator Michele M. Leonhart. "From Washington to Maine, we have disrupted this cartel’s domestic operations—arresting U.S. cell heads and stripping them of more than $59 million in cash—and seriously impacted their Canadian drug operations as well. DEA will continue to work with our domestic and international partners to shut down the operations of the Sinaloa cartel and stop the ruthless violence the traffickers inflict on innocent citizens in the U.S., Mexico and Canada."
The 21-month investigation began shortly after the culmination of Operation Imperial Emperor, an investigation which resulted in the indictment of Organized Crime Drug Enforcement Task Force (OCDETF)-designated Consolidated Priority Organizational Target (CPOT) Victor Emilio Cazarez-Salazar, believed to be a command and control leader within the Sinaloa Cartel. CPOT Victor Cazarez-Salazar remains a fugitive.
As a result of today’s arrests, federal charges were unsealed against numerous individuals in California, Minnesota and Maryland. Cases resulting from Operation Xcellerator are being handled by prosecutors in 11 judicial districts, including the: Central District of California; Southern District of California, District of Minnesota; District of Maryland; Southern District of New York; District of Arizona; District of Massachusetts; Middle District of Pennsylvania; Northern District of Ohio; Western District of Texas; and Eastern District of California. Assistance for Operation Xcellerator was provided by the Criminal Division’s Narcotic and Dangerous Drug Section and Office of International Affairs. Additionally, local prosecutions will occur in Los Angeles, Orange County, Calif., and Riverside, Calif.
The investigative efforts in Operation Xcellerator were coordinated by the multi-agency Special Operations Division, comprised of agents and analysts from the DEA, FBI, U.S. Immigration and Customs Enforcement, Internal Revenue Service, U.S. Customs and Border Protection, U.S. Marshals Service, as well as attorneys from the Criminal Division’s Narcotic and Dangerous Drug Section. More than 200 federal, state, local and foreign law enforcement agencies contributed investigative and prosecutorial resources to Operation Xcellerator through OCEDTF.
An indictment is merely an allegation and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Federal Court Permanently Bars Florida Tax Doctor from Preparing Tax ReturnsRead the Press Release
WASHINGTON - A federal court has permanently barred Harold Mette of Bradenton, Fla., from preparing federal income tax returns for others, the Justice Department announced today. Mette, who has a Ph.D. degree and calls his business "The Tax Doctor," consented to the permanent injunction order, which was entered by U.S. District Judge Richard A. Lazzara in U.S. District Court for the Middle District of Florida.
According to the government complaint, Mette promoted a sham home-based business scheme in the Manatee County area in Florida. The complaint alleges that Mette created a bogus corporation for each customer in order to fraudulently claim the customer’s non-deductible personal expenses as tax-deductible business expenses. Among the improper personal expenses allegedly claimed as deductions were customers’ personal utility bills, mortgage payments, car expenses, vacations, and children’s education expenses. The suit alleges that Mette deducted customers’ personal medical expenses as purported "incentive" payments on the corporation returns.
"Taxpayers should choose their preparer carefully and review their returns closely before signing to ensure that they are correct," said John A. DiCicco, Acting Assistant Attorney General for the Justice Department’s Tax Division. "If a preparer’s claim about a new way to save on taxes sounds too good to be true, it probably is."
Acting Assistant Attorney General DiCicco thanked Tax Division trial attorney Olivia R. Hussey, who handled the case for the government. During the past decade, the Justice Department has obtained injunctions against more than 375 tax return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department Web site.
Falls Church, Va., Man Pleads Guilty to Harboring Indonesian Aliens for Financial GainRead the Press Release
WASHINGTON – Soripada Lubis, a naturalized American citizen originally from Indonesia, pleaded guilty today to harboring illegal aliens for commercial advantage and private financial gain, the Justice Department announced. Lubis’ wife, Siti Chadidjah Siregar, a citizen of Indonesia, pleaded guilty to making false statements to federal agents who were investigating the scheme.
According to the court documents, since at least 2000, Lubis and Siregar have kept up to 11 undocumented Indonesian women in their crowded basement. During the week, these women would live with and work as housekeepers for wealthy families in Potomac, Md. On the weekends, Lubis and Siregar transported the women back to their basement, where some of the women slept three to a bed. Lubis and Siregar also imposed various rules on the Indonesian women that restrained their freedom of movement and they confiscated the womens’ passports. Lubis and Siregar charged the women $375 per month for "rent" and transportation, plus fees for "taxes" and to send money to Indonesia. During the last five years, Lubis and Siregar made more than $90,000 from their enterprise.
When federal agents searched the defendants’ house in October 2008, they questioned Siregar about the Indonesian women. Siregar falsely told the agents that the women had requested that Siregar and Lubis keep their Indonesian passports.
In his guilty plea, Lubis admitted that he harbored between six and 24 aliens and that he was a leader and organizer of his enterprise. Lubis and Siregar also agreed to restitution for the Indonesian women.
"The Civil Rights Division vigorously investigates charges of labor trafficking and will prosecute those who are exploiting vulnerable aliens," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division of the United States Department of Justice.
"For years, Soripada Lubis harbored vulnerable aliens in his home for his own financial gain," said Dana J. Boente, Acting U.S. Attorney for the Eastern District of Virginia. "Thanks to our law enforcement partners and those who cooperated with them, this criminal activity has been shut down."
"The recruitment, harboring and transportation of illegal aliens are very serious crimes that we will simply not tolerate" said Mark X. McGraw, Acting Special Agent in Charge of U.S. Immigration and Customs Enforcement (ICE), Office of Investigations, Washington, D.C. Field Office. "ICE strives to identify and bring to justice those who would engage in and profit by exploiting other human beings."
"Even the most innocent among us may blend into the scenery and be unseen victims," said Joseph Persichini, Jr., Assistant Director in Charge of the FBI Washington Field Office. "Suburban families who paid these women to clean likely never expected the abuses these women suffered as they tried to make a better life for themselves and their family."
At sentencing on May 15, 2009, Lubis faces up to 10 years in prison as well as an order to pay restitution to several women whom he hired out to work as maids. Siregar faces up to five years in prison at sentencing. A sentencing date has not yet been determined.
In fiscal year 2008, the Civil Rights Division and U.S. Attorneys’ Offices filed a record number of criminal civil rights cases, including record numbers of labor trafficking cases.
The investigation was conducted by ICE and the FBI. The case is being prosecuted by Assistant U.S. Attorney James P. Gillis and Civil Rights Division Trial Attorney Michael J. Frank.
24 February 2009
Two Oregon Men Plead Guilty to Federal Hate CrimeRead the Press Release
WASHINGTON - Gary Moss and Devan Klausegger of Medford, Ore., pleaded guilty today to conspiring to interfere with civil rights, announced Acting Assistant Attorney General Loretta King for the Civil Rights Division and U.S. Attorney Karin J. Immergut for the District of Oregon.
According to facts stipulated in their plea agreements and set forth in the indictment, on May 26, 2008, Moss poured a flammable liquid on the front lawn of the victims’ residence in the shape of a cross and the letters "KKK". Klausegger handed Moss a small explosive device that Moss used to ignite the flammable liquid. Moss and Klausegger admitted that this was done with the intent to interfere with the victims’ rights under the Fair Housing Act because one of the victims was African-American.
Moss and Klausegger were indicted by a federal grand jury on July 16, 2008.
"Bias-motivated acts of violence are offensive to our nation's fundamental values," said Loretta King, Acting Assistant Attorney General for the Civil Rights Division. "The Justice Department is committed to vigorously prosecuting the federal laws prohibiting violent acts motivated by hate."
"Crimes committed in the name of racial hatred tear at the very fabric of our society," said U.S. Attorney Karin J. Immergut. "All members of our society must be free to live without fear that they will be targeted because of their race."
Moss and Klausegger face a maximum punishment of 10 years in prison, up to three years of supervised release and a fine of up to $250,000.
Sentencing has been scheduled for May 5, 2009, before Judge Ann Aiken.
This case is being prosecuted by the Assistant U.S. Attorney Bud Fitzgerald and Trial Attorney Roy Conn from the Civil Rights Division.
Three Former Atlanta Police Officers Sentenced to Prison <br /> in Fatal Shooting of Elderly Atlanta WomanRead the Press Release
WASHINGTON - Three former Atlanta Police Department (APD) officers were sentenced to prison today by Chief U.S. District Judge Julie E. Carnes on a charge of conspiracy to violate civil rights resulting in death, arising from the fatal police shooting of Kathryn Johnston, a 92-year old Atlanta woman. Johnston was fatally shot at her home during the execution of a search warrant obtained by the defendants based upon false information on Nov. 21, 2006. The announcement was made by Acting Assistant Attorney General Loretta King of the Civil Rights Division; U.S. Attorney David E. Nahmias for the Northern District of Georgia; and Gregory Jones, Special Agent in Charge of the FBI’s Atlanta office.
Jason R. Smith, 36, of Oxford, Ga., was sentenced to 10 years in federal prison; Gregg Junnier, 42, of Woodstock, Ga., was sentenced to 6 years in federal prison; and Arthur Tesler, 42, of Acworth, Ga., was sentenced to 5 years in federal prison. There is no parole in the federal system. Each defendant was also sentenced to serve 3 years of supervised release following his prison term, and collectively to pay $8,180 in restitution for the costs of Johnston’s funeral and burying.
"The Justice Department is committed to vigorously prosecuting law enforcement officers who willfully disregard the Constitution and abuse their authority to violate the rights of others," said Acting Assistance Attorney General Loretta King. "This sort of unlawful behavior, resulting in Ms. Johnston's tragic death, undermines the efforts of law enforcement officers who honorably perform their duties."
In a news conference after the sentencing hearings, U.S. Attorney David E. Nahmias said in part, "As Atlanta police narcotics officers, these three defendants repeatedly failed to follow proper procedures and then lied under oath to obtain search warrants. Their routine violations of the Fourth Amendment led to the death of an innocent citizen. The death of Kathryn Johnson in a police shooting was a terrible tragedy for a law-abiding elderly woman, her family, and our entire community. But as her family and others hoped, from this tragedy have come two positive results. First, it has led the Atlanta Police Department to implement useful reforms in training and supervision and to entirely revamp its Narcotics Unit, reducing the possibility of a similar tragedy in the future. Second, the significant prison sentences imposed by the Court today should send a strong message to other law enforcement officers who may be tempted to lie under oath or otherwise violate the law. Officers who think, as these defendants once did, that the ends justify the means or that ‘taking shortcuts’ and telling lies will not be discovered and punished should realize that they are risking their careers and their liberty. And officers who try to obstruct justice when their misconduct faces exposure, rather than cooperating in the investigation, should realize that they will be face even more severe punishment."
Gregory Jones, Special Agent in Charge, FBI Atlanta, said, "This is a sad day in the law enforcement community. Few crimes are as reprehensible as those committed by police officers who violate the very laws they have sworn to uphold. Our thoughts and prayers are with the Johnston family, and we hope today's sentencing helps bring closure to this tradegy. Further, we want the public to know the FBI will continue to pursue and bring to justice those who violate their oaths of office and the civil rights of others."
Junnier and Smith pleaded guilty to the federal charge, as well as to voluntary manslaughter and related state charges in Fulton County, Ga., Superior Court, on April 26, 2007. According to their plea agreements, they will be sentenced in state court on March 5, 2009, to the same sentence imposed in federal court, with the sentences to be served concurrently. Tesler initially declined to plead guilty and was indicted in state court on charges of violation of oath of office by a public officer, false imprisonment and false statements. In 2008, Tesler was convicted at trial in state court on the false statement charges, but that conviction was reversed on appeal. Following the state trial, federal authorities re-evaluated Tesler’s case, conducted further investigation, and determined that federal prosecution of Tesler was appropriate. Tesler pleaded guilty to the federal charge on Oct. 30, 2008.
Junnier began cooperating truthfully with federal authorities shortly after the incident and provided valuable assistance in the investigation and prosecution of Smith and Tesler. Additionally, Junnier’s cooperation led to guilty pleas by two additional APD officers to federal charges, including the sergeant who commanded the narcotics team involved in the shooting. Smith cooperated to a more limited extent. Both former officers provided information relevant to a broader FBI investigation of misconduct by APD narcotics and other officers, which culminated in a report provided by the FBI to APD Chief Richard Pennington in October 2008 for consideration of potential administrative discipline against other APD officers. As a result of their cooperation, the court reduced Junnier’s sentence by 40 percent and Smith’s sentence by 20 percent. Tesler did not provide substantial assistance in the investigation and received no sentence reduction on that ground, although his sentence was reduced based on his lesser role in the conspiracy.
The facts and other details regarding the case are set forth in the Government’s sentencing memorandum.
This case was investigated by the FBI. The case was prosecuted by Assistant U.S. Attorney Jon-Peter Kelly, U.S. Attorney David E. Nahmias and Special Litigation Counsel Paige M. Fitzgerald of the Civil Rights Division.
Japanese Corporate Operator of Cargo Vessel Sentenced to Pay $1.75 Million for Conspiracy and Falsifying RecordsRead the Press Release
TAMPA, FLA. – U. S. District Judge Steven D. Merryday today sentenced the Japanese corporation Hiong Guan Navegacion Japan Co. Ltd., that operates the commercial cargo ship M/V Balsa-62, to three years probation and $1.75 million in penalties for conspiring to falsify and falsifying environmental compliance records, the Justice Department announced.
Four hundred thousand dollars of the $1.75 million that Hiong Guan must pay will go to the National Fish and Wildlife Foundation, which partners locally with the Pinellas County, Fla., Environmental Fund (PCEF). PCEF has funded numerous wide-ranging projects related to the protection, restoration and enhancement of fish and wildlife habitat in the Tampa Bay area. The court also ordered Hiong Guan to implement a detailed environmental compliance plan, including monitoring of its fleet-wide operations for the next three years, training for crew members, and engineering alterations to protect gulf and ocean waters.
On Nov. 20, 2008, Hiong Guan pleaded guilty to falsifying the "Oil Record Book" for the M/V Balsa-62. Federal and international law requires that all ships properly dispose of oily water and sludge by processing it through an oily-water separator and burning the sludge in the ship’s incinerator to avoid polluting ocean waters. Federal law also requires all ships traveling in United States waters to record accurately each disposal of oily water or sludge in an Oil Record Book, and to have the book available for inspection by the U.S. Coast Guard.
According to court documents, from Spring 2007 through February 2008, Francisco Bagatela, the chief engineer of the M/V Balsa-62, used a bypass pipe, which is referred to as a "magic pipe," to circumvent the pollution prevention equipment on board the ship and dump oily water and sludge directly overboard and into the ocean approximately twice a month. On Feb. 25, 2008, Robert Racho replaced Bagatela as chief engineer and continued using the magic pipe. The engineers used the pipe to dump oily water and sludge at night when the ship was underway, and they further concealed the discharges by not recording them in the ship’s Oil Record Book.
On Oct. 31, 2007, and again on May 31, 2008, the M/V Balsa-62 arrived in the Port of Tampa with its falsified Oil Record Book. The U.S. Coast Guard conducted an inspection of the ship on May 31, 2008, based in part on information from the ship’s crew. At that time, the officers on board presented the falsified book. The U.S. Coast Guard then located evidence on board the ship corroborating the crew members’ allegation that the ship had been unlawfully discharging oily waste.
Chief Engineers Bagatela and Racho both already have pleaded guilty to felony offenses relating to their falsification of the M/V Balsa-62's Oil Record Book. In December 2008, the court sentenced Bagatela to three years probation and a $1,500 fine and Racho to one year probation and a $1,000 fine.
"Hiong Guan is paying for failing to follow the law by, among other things, attempting to mislead the Coast Guard with falsified environmental-compliance records. Today’s substantial criminal fine and extensive environmental compliance plan should serve as deterrents to shipping companies and mariners who may consider violating the environmental laws that protect our oceans," said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.
Upon Hiong Guan’s sentencing, U.S. Attorney A. Brian Albritton stated, "Protecting our waters from pollution is crucial to our marine life as well as human life. The U.S. Coast Guard did a great job investigating and uncovering this filthy practice of allowing oily water to discharge from the Balsa-62. Fortunately, a large portion of the penalty the company has to pay will stay right here in the Tampa Bay area to restore and enhance our bay and gulf waters."
Captain Timothy Close, the Coast Guard Captain of the Port of Tampa, St. Petersburg and Manatee said, "The successful investigation and prosecution of this case by the U.S. Coast Guard and Department of Justice sends a clear message to owners and operators of commercial vessels that those who choose to intentionally pollute our oceans will be met with swift repercussions and stiff penalties. This case highlights the importance of Coast Guard boarding teams inspecting vessels for compliance with U.S. and international pollution prevention standards."
This case was investigated by the U.S. Coast Guard, Coast Guard Investigative Service. It was prosecuted by Leslie E. Lehnert, Trial Attorney for the Justice Department’s Environmental Crimes Section, Cherie L. Krigsman, Assistant U.S. Attorney for the Middle District of Florida and Lieutenant William George, U.S. Coast Guard.
Former Employee of the Export-Import Bank of the United States Charged with Corruption and Tax ViolationsRead the Press Release
WASHINGTON – A former employee of the Export-Import Bank of the United States (Ex-Im Bank) has been indicted on corruption and tax violations arising from her alleged receipt of a $100,000 bribe while working at the Ex-Im Bank, Acting Assistant Attorney General Rita M. Glavin of the Criminal Division and Acting U.S. Attorney Dana J. Boente for the Eastern District of Virginia announced today.
Maureen Njideka Edu, a/k/a Maureen N. Scurry, 42, of Potomac, Md., was indicted by a federal grand jury in Washington on Feb. 20, 2009, for conspiring to solicit and accept bribes and to deprive the United States and the Ex-Im Bank of her honest services, as well as substantive counts of bribery, honest services wire fraud and filing a false tax return. The indictment, which was unsealed today following Edu’s arrest, also seeks the forfeiture of $100,000 from Edu.
According to the indictment, Edu worked for the Ex-Im Bank from May 2000 to October 2004 as a business development specialist covering Africa and focused on sub-Saharan Africa, which included the West African nation of Nigeria. During the course of her work, according to the indictment, Edu was introduced to Nigerian businessmen who were seeking to buy certain products and services from a Kentucky-based technology company in a deal worth approximately $44 million. The Nigerian businessmen were seeking financial support from the Ex-Im Bank to support the business deal. The indictment alleges that the Nigerian businessmen agreed to pay Edu a bribe of $173,500, with an initial installment of $100,000, in return for her promise to perform official acts to assist the Nigerian businessmen and their company in obtaining loan guarantees and other financial support from the Ex-Im Bank.
The indictment also alleges that, on Feb. 24, 2004, one of the Nigerian businessmen wrote a letter to a bank in Nigeria captioned "Facilitation Fees to Maureen Scurry," in which the businessman asked that $100,000 be, "transferred to Miss Maureen Scurry of US-EXIM Bank to enable her to facilitate our guarantees with Ex-im [sic] Bank." According to the indictment, the letter also stated that the Board of Directors requested the personal assistance of Scurry to expedite the processes with the Ex-Im Bank and that the, "total amount agreed upon between ourselves was US$173,500" but that, "the balance will be paid once the transaction is over and monies are disbursed." According to the indictment, on Feb. 27, 2004, a wire transfer of $100,000 was sent to the Edu’s personal bank account at a bank in the District of Columbia. Due to disputes between the Nigerian businessmen and the Kentucky-based technology company, according to the indictment, the business deal later ended in mid-2004 before any products or services were provided.
An indictment is merely a charge and the defendant is presumed innocent until proven guilty.
The case is being prosecuted by Assistant Chief Charles E. Duross of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Mark D. Lytle and Rebeca H. Bellows of the U.S. Attorney’s Office for the Eastern District of Virginia, who have been specially appointed to prosecute the matter in the District of Columbia. The U.S. Attorney’s Office for the District of Columbia’s Fraud and Public Corruption Section also provided considerable support and assistance. The case was investigated by the FBI and the Internal Revenue Service, Criminal Investigation. The Export-Import Bank of the United States assisted and cooperated throughout the investigation of this matter.
Indictment
23 February 2009
United States Transfers Binyam Mohammed to United KingdomRead the Press Release
WASHINGTON – The Department of Justice today announced the transfer to the United Kingdom of Binyam Mohammed, an Ethiopian national and former resident of the United Kingdom who had been held at the Guantanamo detention facility since 2004.
As directed by the Executive Order issued by President Obama on January 22, 2009, an interagency panel has reviewed Mohammed’s case and determined that his transfer, pursuant to an arrangement between the United States and the United Kingdom, is consistent with the national security and foreign policy interests of the United States and the interests of justice.
"The friendship and assistance of the international community is vitally important as we work to close Guantanamo, and we greatly appreciate the efforts of the British government to work with us on the transfer of Binyam Mohammed," said Attorney General Eric Holder.
Mohammed is the first Guantanamo detainee to be transferred under the review of all Guantanamo detainees directed by the President. He departed Guantanamo aboard a United Kingdom aircraft Sunday night and arrived in the United Kingdom today.
U.S. District Court Judge Pleads Guilty to Obstruction of JusticeRead the Press Release
WASHINGTON – U.S. District Judge Samuel B. Kent pleaded guilty today to obstruction of justice in federal court in Houston, Acting Assistant Attorney General Rita M. Glavin and Andrew R. Bland III, Special Agent in Charge of the FBI’s Houston office announced.
Kent, 59, a district judge in the Southern District of Texas, pleaded guilty to making false statements to a special investigative committee of the U.S. Court of Appeals for the Fifth Circuit during an investigation of a judicial misconduct complaint filed against him. Kent’s guilty plea was accepted by the Hon. Roger Vinson, Senior U.S. District Judge for the Northern District of Florida, who was sitting by designation in the Southern District of Texas.
A grand jury in the Southern District of Texas indicted Kent in August 2008 on two counts of abusive sexual contact and one count of attempted aggravated sexual abuse for his alleged repeated assaults on an employee of the Office of the Clerk of Court, identified as Person A. In January 2009, the grand jury returned a superseding indictment against Kent, maintaining the original charges and adding one count each of abusive sexual contact and aggravated sexual abuse for Kent’s alleged repeated assaults on another U.S. District Court employee, identified as Person B. The January 2009 superseding indictment also added one count of obstruction of justice, alleging Kent obstructed an investigation into a misconduct complaint filed by Person A.
As part of his plea, Kent admitted that in both 2003 and 2007, he engaged in non-consensual sexual contact with Person A. He also admitted that he engaged in non-consensual contact with Person B from 2004 through at least 2005. According to court documents, when Person A filed a misconduct complaint against Kent, the Fifth Circuit appointed a committee to investigate whether Kent had engaged in unwanted sexual contact with Person A or any other individuals. Kent admitted that when he appeared before the committee in June 2007, he falsely testified about his conduct with Person B.
Sentencing is scheduled for May 11, 2009.
The case is being prosecuted by Senior Deputy Chief Peter J. Ainsworth and Trial Attorneys John P. Pearson and AnnaLou T. Tirol of the Criminal Division’s Public Integrity Section, which is headed by Section Chief William M. Welch II. The case was investigated by the FBI.
Memphis Man Pleads Guilty to Federal Sex Trafficking ChargesRead the Press Release
WASHINGTON – Leonard Fox a/k/a Anton a/k/a "Daddy" pleaded guilty today to a federal civil rights charge for sex trafficking of minors, announced Acting Assistant Attorney General Loretta King of the Civil Rights Division and U.S. Attorney Lawrence J. Laurenzi for the Western District of Tennessee.
In U.S. District Court in Memphis, Fox admitted to recruiting and obtaining underage girls and arranging for those girls to engage in commercial sex acts for his financial benefit.
"The defendant forced children into the brutal and demeaning world of human trafficking," said Acting Assistant Attorney General Loretta King. "To sexually prey upon young girls in this manner for financial gain is particularly damaging to the victims and an affront to the society in which we live."
"Fox faces up to life in prison after his plea today where he admitted to preying upon the innocence of young girls so that he could profit at their expense," said U. S. Attorney Laurenzi. "The United States Attorney’s Office takes seriously the victimization of our community’s children and will continue to investigate and prosecute these cases."
Fox faces a mandatory minimum of 10 years in prison and a maximum sentence of life in prison as well as a fine of up to $250,000. Sentencing is schedule for May 28, 2009.
Human trafficking prosecutions are a top priority of the Justice Department. In Fiscal Year 2008, the Civil Rights Division and U.S. Attorneys’ Offices filed a record number of criminal civil rights cases, including record numbers of both sex trafficking and labor trafficking cases.
The case is being prosecuted by Assistant U.S. Attorney Steve Parker and Civil Rights Division Trial Attorney Jim Felte. The case was investigated by the FBI, the Memphis Police Department and the Fayette County Sheriff’s Department.
Justice Department Sues Housing Authority in Wayne County, Ill., for Race DiscriminationRead the Press Release
WASHINGTON — The Justice Department today filed a lawsuit against the Wayne County Housing Authority (WCHA), in Fairfield, Ill., as well as Jill Masterson and Danna Sutton, WCHA’s executive director and assistant director, respectively, alleging that they violated the Fair Housing Act when they tried to discourage a white couple from renting their property in Fairfield to an African-American woman.
The complaint, filed in U.S. District Court for the Southern District of Illinois, alleges that the defendants discriminated against a white couple who were planning to rent a house to an African-American woman through the Housing Choice Voucher program (also known as Section 8). The Housing Choice Voucher program provides rental assistance to eligible low-income families, the elderly and persons with disabilities. Wayne County, Ill., receives federal funding from the U.S. Department of Housing and Urban Development (HUD) to administer the Housing Choice Voucher program.
The complaint alleges that the defendants made racially discriminatory statements to the couple, and "failed" their property at the mandatory inspection, which required the couple to make certain repairs and be inspected again before they could rent their unit under the Housing Choice Voucher program. By contrast, the complaint alleges that when WCHA found similar deficiencies at other properties in the Housing Choice Voucher program, its practice has been to "pass" the property and verbally counsel the landlords to make the repairs. The complaint alleges that defendants took these actions to discourage the couple from renting the property to the African-American woman. The complaint also alleges that the defendants determined that the property would have to be re-inspected because the couple had complained about racially discriminatory comments allegedly made by Sutton.
The lawsuit originated from a complaint filed with HUD by the couple. After an investigation, HUD found reasonable cause to believe that unlawful discrimination had occurred and referred the matter to the Justice Department.
"It is against the law for public housing authorities to engage in racially discriminatory housing practices. Public housing authorities should support, not hinder, landlords who want to rent their properties in compliance with the Fair Housing Act," said Acting Assistant Attorney General Loretta King. "We will continue to vigorously prosecute those who stand in the way of achieving the Fair Housing Act’s goal of allowing all people to live in the communities of their choice, regardless of their race."
U.S. Attorney A. Courtney Cox for the Southern District of Illinois emphasized the importance of all people receiving equal treatment under the law regardless of race. "The United States Attorney’s Office will do everything in its power to assure that all of the citizens of Southern Illinois have equal access to housing as guaranteed by law."
"All housing discrimination is deplorable. It’s worse still when taxpayer-supported public housing authorities allegedly use federal dollars to discriminate," said Bryan Greene, General Deputy Assistant Secretary for Fair Housing and Equal Opportunity at HUD. "HUD will pursue allegations of housing discrimination in all their forms, whether it’s in public or private housing. We’re pleased to have the Department of Justice as a partner in this effort."
The lawsuit seeks monetary damages for the couple and a court order barring future discrimination.
Fighting illegal housing discrimination is a top priority of the Justice Department. The 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. Additional information about the Fair Housing Act is also available at www.HUD.gov.
The complaint is an allegation of unlawful conduct. The allegations must still be proven in federal court.
Justice Department Resolves Lawsuit with State of Vermont Regarding Reporting Requirements of Uniformed and Overseas Citizens Absentee Voting ActRead the Press Release
WASHINGTON - The Justice Department announced today the resolution of the lawsuit filed by the United States against the state of Vermont to enforce the reporting requirements of the Uniformed Overseas Citizen Absentee Voting Act (UOCAVA). UOCAVA is designed to ensure that members of the uniformed services and overseas citizens may effectively participate in federal elections.
The state of Vermont and the Vermont Secretary of State, Deborah L. Markowitz, are responsible for collecting and reporting the number of absentee ballots that are sent to uniformed service voters and overseas citizens. The United States filed a lawsuit against the state of Vermont and its Secretary of State, on Oct. 10, 2008, because Vermont had failed to comply with UOCAVA’s reporting obligations after both the 2004 and 2006 general elections. Today, the United States voluntarily dismissed the lawsuit because Vermont brought its UOCAVA reporting into compliance.
"Accurate and complete information about whether our uniformed service members and overseas citizens are being given an effective opportunity to have their votes counted is essential," said Acting Assistant Attorney General Loretta King for the Civil Rights Division. "We are pleased that Vermont and its Secretary of State have now provided this important information."
The UOCAVA specifically mandates that all states and local governments report to the Election Assistance Commission (EAC) no later than 90 days after the date of each regularly scheduled general election for federal office the combined number of absentee ballots that are sent to absent uniformed services voters and overseas voters for the election and the combined number of such ballots that were returned by these voters and cast in the election. The EAC publishes a report every two years and provides data concerning UOCAVA ballots for every state and jurisdiction in the United States.
The Civil Rights Division enforces UOCAVA and the Voting Rights Act. To file complaints about discriminatory voting practices, including difficulties experienced by UOCAVA voters, voters may call the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931. More information about the Voting Rights Act and other federal voting laws is available on the Department of Justice website at http://www.usdoj.gov/crt/voting/index.htm.
Fraudulent Tax Return Preparer Sentenced to PrisonRead the Press Release
WASHINGTON - Rodrick Williams, a former tax return preparer from District Heights, Md., was sentenced to 24 months in prison by U.S. District Judge Roger W. Titus for preparing false tax returns for customers, the Justice Department and Internal Revenue Service (IRS) announced today.
In May 2008, Williams pleaded guilty to conspiracy to impede the IRS. Williams’s co-defendant, DaJuan Jackson was convicted in November 2008, by a Greenbelt, Md., jury of eight counts of aiding and assisting in the preparation and presentation of false tax returns.
According to the evidence introduced in the plea agreement and at trial, Williams and Jackson, both currently of Atlanta, prepared tax returns at a branch office of American Tax Associates Inc. (ATA), located in a Run ’N Shoot gym in District Heights. Williams and Jackson were the two main preparers in the branch office, which was responsible for preparing almost 1000 tax returns per year at the height of its business in 2004.
Williams cooperated with the government, and at trial, he testified that he and Jackson devised a scheme to place false information on the tax returns of ATA clients. In particular, Williams and Jackson falsified itemized deductions and business expenses so clients could fraudulently obtain bigger refunds.
Jackson was sentenced to 51 months in prison by Judge Titus on Feb. 19, 2009.
Acting Assistant Attorney General John DiCicco commended the IRS special agents who investigated the case, as well as Tax Division trial attorneys Jerrod Patterson and Shawn Noud who prosecuted the case.
More information about the Justice Department’s Tax Division and its enforcement efforts is available at http://www.usdoj.gov/tax/.
20 February 2009
Justice Department Files Lawsuit Against the Chicago Board of Education for Alleged Pregnancy DiscriminationRead the Press Release
WASHINGTON - The Department of Justice today filed a lawsuit against the Board of Education of the City of Chicago (Board), alleging pregnancy discrimination in employment against former elementary school teacher Traci Meziere, Acting Assistant Attorney General Loretta King of the Civil Rights Division announced.
The complaint, filed in U.S. District Court in Chicago, alleges that the Board discriminated against Meziere on the basis of sex while she was employed at Norwood Park Elementary School by: rescinding her accrued seniority after she took a leave associated with her pregnancy; releasing her from her position as a full-time substitute teacher and then demoting her to a position with less pay, fewer benefits and diminished responsibilities; and denying her a requested leave associated with her pregnancy. The complaint was filed under Title VII of the Civil Rights Act of 1964, which prohibits discrimination in the workplace that is based on race, color, sex, national origin and religion.
"Pregnancy discrimination in the workplace, including in the educational system, will not be tolerated, and public employers must take prompt and effective action to stop it," said Acting Assistant Attorney General Loretta King. "The Department of Justice will vigorously pursue such violations of Title VII."
The continued enforcement of Title VII is a priority of the Justice Department’s Civil Rights Division. Additional information about the Civil Rights Division of the Justice Department is available on its Web site at http://www.usdoj.gov/crt/.
John Doe # 17 Indicted in Child Pornography CaseRead the Press Release
"John Doe 17," a white male with curly brown hair weighing approximately 210-250 pounds, has been indicted by a federal grand jury for transporting child pornography via the Internet on or about May 5, 2007, Acting Assistant Attorney General of the Criminal Division Rita M. Glavin and U.S. Attorney for the District of Maryland Rod J. Rosenstein announced today.
This is the seventeenth such case to be investigated and the twelfth prosecuted through the Endangered Child Alert Program (ECAP), which was initiated by the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and the FBI in 2004. The program uses national and international media exposure of unknown adult perpetrators featured in child pornography in an effort to identify, locate, apprehend and prosecute such offenders and to rescue abused children.
The case arose from an investigation of a global enterprise utilizing newsgroups to trade more than 400,000 images of child pornography. An individual in the newsgroup posted two videos of a perpetrator, John Doe #17, engaged in the sexual exploitation of a pre-pubescent female. Forensic analysis of the video clip yielded clear pictures of John Doe #17’s profile and other identifying features that will better enable the public to assist with this case without encroaching on the victim’s privacy.
If convicted, the defendant faces between five and 20 years in prison and up to a $250,000 fine.
In many ECAP cases, the pictures of other John Doe offenders have been featured on the "America’s Most Wanted" Web site and television show, as well as "The O’Reilly Factor" television program. Since ECAP’s inception, viewers of the television programs and Web site have provided information leading to the investigation and indictment of several other offenders, and at least 30 child victims have been identified.
The prosecution is being handled by CEOS Trial Attorney LisaMarie Freitas and Assistant U.S. Attorney Bonnie Greenberg from the District of Maryland. The investigation is being handled by the FBI’s Innocent Images Unit in Calverton, MD.
See photo of "John Doe 17"
Indictment
Federal Court Bars Tennessee Resident from Preparing Tax Returns for OthersRead the Press Release
WASHINGTON - A federal district court in Tennessee has permanently barred Chattanooga resident Demita Brown-Watkins from preparing federal income tax returns for others, the Justice Department announced today. Brown-Watkins agreed to the civil injunction order.
According to the government complaint, Brown-Watkins ran her tax-preparation business through two companies —Fastax and Rapid Tax Service —and advertised the "largest refund in town." The government complaint alleged that Brown-Watkins listed fictitious expenses (such as gifts to charity) on her customers’ Schedules A; selected the incorrect filing status or listed ineligible dependants on her customers’ returns; filed claims for education credits for customers who she knew were ineligible for them; and listed fictitious Schedule C businesses on the tax returns of customers who were ineligible to file a Schedule C.
The complaint further asserts that Brown-Watkins prepared more than 3,000 returns since 2004 and that, based on IRS estimates, Brown-Watkins deprived the U.S. Treasury of over $8 million in tax revenue.
Acting Assistant Attorney General John A. DiCicco thanked Tax Division trial attorney Curtis Weidler for his efforts in obtaining the injunction. In the past decade, the Justice Department has obtained injunctions against more than 375 tax return preparers and tax-fraud promoters. Information about those cases is available on the Justice Department Web site.
Department of Justice Statement on the Abandonment of the JBS/National Beef TransactionRead the Press Release
WASHINGTON – The Department of Justice issued the following statement today after JBS and National Beef announced the abandonment of the JBS/National Beef transaction, which the Department had filed suit to block in October:
"The Antitrust Division welcomes this decision. Had the acquisition gone forward, it would have combined two of the top four U.S. beef packers resulting in lower prices paid to cattle suppliers and higher beef prices for consumers. The decision to abandon the transaction will preserve competition in the purchase of cattle that has been critical to ensuring competitive prices to the nation’s thousands of producers, ranchers and feedlots. It will also preserve competition in the sale of boxed beef to grocers, food service companies and ultimately American consumers. The Department remains vigilant in protecting competition in this industry with more than $50 billion in total commerce at stake."
The Department intends to move to terminate the pending litigation.
Background
On Oct. 20, 2008, the Department filed an antitrust lawsuit in the U.S. District Court in Chicago to block the proposed acquisition, alleging that the deal would result in lower prices paid to cattle suppliers and higher beef prices for consumers. At that time, Attorneys General of Colorado, Iowa, Kansas, Minnesota, Missouri, Montana, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Texas and Wyoming joined the Department’s lawsuit. On Nov. 7, 2008, the states of Arizona, Connecticut, New Mexico and Mississippi joined the lawsuit as well.
Attorney General Appoints Executive Director to Lead New Task Force on Review of Guantanamo Bay DetaineesRead the Press Release
WASHINGTON – Attorney General Eric Holder today announced the appointment of an Executive Director to lead a new interagency task force charged with continued implementation of the President’s Jan. 22 Executive Order calling for an immediate review of the status of individuals currently detained at Guantanamo Bay Naval Base.
The Executive Director, Matthew G. Olsen, will lead the Guantanamo Detainee Review Task Force, which is responsible for assembling and examining relevant information and making recommendations regarding the proper disposition of each individual currently detained at Guantanamo Bay.
In accordance with the President’s Order, the Task Force will consider whether it is possible to transfer or release detained individuals consistent with the national security and foreign policy interests of the United States; evaluate whether the government should seek to prosecute detained individuals for crimes they may have committed; and, if none of those options are possible, the Task Force will recommend other lawful means for disposition of the detained individuals.
The Order provides that the Attorney General shall coordinate this review in conjunction with the Secretaries of Defense, State, and Homeland Security, the Director of National Intelligence and the Chairman of the Joint Chiefs of Staff in order for the detention facilities at Guantanamo Bay to be closed within one year from the date of the Executive Order.
"As a leader of the Department’s National Security Division and 12-year career federal prosecutor, Mr. Olsen has the experience and judgment to lead the team’s evaluation of these individual cases," said Attorney General Holder. "We’ve established a solid framework for the administration to make the right decision on each individual detainee -- decisions that will most effectively serve the interests of justice and the national security and foreign policy objectives of the United States."
As Executive Director for the detention review process, Mr. Olsen will be responsible for managing the consideration and disposition of individual detainee cases as set forth in the President’s Order. He will supervise review teams consisting of representatives from the Justice Department and the other agencies identified in the President’s Order.
These multi-agency teams will conduct the specific detainee reviews and develop options and recommendations for the Executive Director to present to a Review Panel consisting of senior-level officials from each of the relevant Departments and agencies who are authorized to make decisions as to the disposition of each detainee. Review Panel members will be responsible for ensuring that each department or agency devotes the necessary resources so that the Task Force can conduct this review and enable closure of the facility within the one-year time frame required under the Executive Order.
Until his appointment today, Mr. Olsen served as the Acting Assistant Attorney General for National Security, where he managed the Justice Department’s National Security Division. Previously, as Deputy Assistant Attorney General, he helped establish the National Security Division in 2006 and supervised the Department’s intelligence operations and oversight.
19 February 2009
United States Joins Suits Against Scios and Johnson & JohnsonRead the Press Release
WASHINGTON – The United States has intervened in two whistleblower suits filed in the Northern District of Californiaagainst the drug manufacturer Scios Inc. and its parent company, Johnson & Johnson Inc., alleging that the companies marketed the cardiac drug Natrecor for a use not approved by the Food and Drug Administration (FDA) and caused false and fraudulent claims to be submitted to the federal health care programs, the Justice Department announced today. Such an unapproved use is also known as an "off-label" use because it is not included in the drug’s FDA approved product label.
Under the Food, Drug and Cosmetic Act, a company must specify the intended uses of a product in its new drug application to the FDA. Before approving a drug, the FDA must determine that the drug is safe and effective for the use proposed by the company. Once approved, the drug company may not market or promote the drug for off-label uses.
In August 2001, the FDA approved Natrecor for "the intravenous treatment of patients with acutely decompensated congestive heart failure who have dyspnea [shortness of breath] at rest or with minimal activity." The study upon which this approval was based involved hospitalized patients who had severe heart failure and who received infusions of Natrecor over an average 36-hour period. The government’s investigation revealed that shortly after receiving this approval in 2001, Scios began an aggressive campaign to market Natrecor for scheduled, serial outpatient infusions for patients with less severe heart failure – a use not included in the FDA-approved label. These patients were prescribed Natrecor infusions for less than 6 hours on a scheduled basis over an extended period of time.
Medicare does not cover drugs used for off-label uses unless such off-label use is established to be medically necessary. The federal health care programs – in particular, Medicare – paid substantial amounts for the serial outpatient off-label use of Natrecor.
In mid-2005, a panel of leading cardiologists told Scios that it should stop promoting the scheduled, serial outpatient use of Natrecor. Scios subsequently sent a letter to healthcare providers in which it acknowledged that there was insufficient clinical evidence supporting the safety and efficacy for scheduled, serial outpatient use of the drug. In 2007, Scios released the results of a clinical study that showed no significant benefits of serial outpatient Natrecor infusions.
The two separate civil False Claims Act suits – called qui tam actions – were filed by former Scios sales managers against Scios and Johnson & Johnson in the Northern District of California. The False Claims Act allows for private persons to file whistleblower suits to provide the government information about wrongdoing. Under the statute, if it is established that a person has submitted or caused others to submit false or fraudulent claims to the United States, the government can recover treble damages and $5,500 to $11,000 for each false or fraudulent claim filed. If the government is successful in resolving or litigating its claims, the whistleblower who initiated the action can receive a share of between 15 percent to 25 percent of the amount recovered.
The qui tam or whistleblower actions contain additional allegations. However, the United States is only intervening with regard to allegations that Scios marketed the drug Natrecor for serial infusions in the outpatient setting.
The investigation was conducted by the Civil Division of the U.S. Department of Justice, the U.S. Attorney’s Office for the Northern District of California, the Federal Bureau of Investigation, and the Offices of Inspector General of the Department of Health and Human Services, the FDA, the Department of Veterans Affairs, the Office of Personnel Management, and the Department of Defense.
United States Asks Court to Enforce Summons<br /> for UBS Swiss Bank Account RecordsRead the Press Release
WASHINGTON - The government filed a lawsuit today in Miami against Swiss bank UBS AG, the Justice Department announced. The lawsuit asks the court to order the international bank to disclose to the Internal Revenue Service (IRS) the identities of the bank’s U.S. customers with secret Swiss accounts. According to the lawsuit, as many as 52,000 U.S. customers hid their UBS accounts from the government in violation of the tax laws.
The government alleges in the lawsuit that of those 52,000 secret accounts, about 20,000 contained securities and about 32,000contained cash. According to a UBS document filed with the lawsuit, as of the mid-2000s, those secret accounts held about $14.8 billion in assets. Court documents allege that U.S. citizens failed to report and pay U.S. income taxes on income earned in those secret accounts.
According to the lawsuit, Swiss-based bankers actively marketed UBS’s services to wealthy U.S. customers within the United States. UBS documents filed with the lawsuit show that UBS bankers came to the United States to meet with U.S. clients nearly 4,000timesper year, in violation of U.S. law. According to court documents, the government alleges that UBS trained its bankers to avoid detection by U.S. authorities. Court documents further assert that many U.S. contacts occurred through UBS-sponsored sporting and cultural events, designed to appeal to extremely wealthy Americans.
The lawsuit alleges that UBS engaged in cross-border securities transactions in the United States that it knew violated U.S. security laws. The lawsuit also alleges that UBS helped hundreds of U.S. taxpayers set up dummy offshore companies, to make it easier forthose taxpayerstoavoid their reporting obligations under U.S. tax laws.
"At a time when millions of Americans are losing their jobs, their homes and their health care, it is appalling that more than 50,000 of the wealthiest among us have actively sought to evade their civic and legal duty to pay taxes," said John A. DiCicco, Acting Assistant Attorney General for the Justice Department’s Tax Division. "It is time for those who are trying to hide from the IRS to rethink their actions. The Department of Justice is committed to do all that it can to aid the IRS in locating those who would seek to hide behind secret accounts and in holding them accountable under the federal tax laws."
"We are committed to moving forward with the summons enforcement process. This action sends a strong signal to taxpayers hiding their money offshore. The IRS will be aggressive in pursuing people who shirk their obligations under the tax law. These people owe it to their fellow citizens to pay their fair share of taxes," said IRS Commissioner Doug Shulman. "As Commissioner, I am committed to bringing to bear the full arsenal of IRS resources to pursue egregious offshore tax abuse. International tax issues are a top priority, and we will continue to aggressively pursue people hiding assets offshore. For people who are hiding money offshore, this serves as a wake-up call that they need to get right with their government. Taxpayers should talk to a tax professional and come forward under our voluntary disclosure process. Having the IRS find you could mean a much heavier price than coming forward on your own."
Information about the Justice Department’s Tax Division and its enforcement efforts is available at http://www.usdoj.gov/tax/.
Shipping Company, Chief Engineer and Second Engineer Indicted for Covering up PollutionRead the Press Release
WASHINGTON—A federal grand jury in Newark, N.J., has returned an eight-count indictment charging a Liberian company that manages an oceangoing bulk carrier vessel, M/V Myron N, along with the ship’s chief engineer and second engineer for covering up discharges of oil-contaminated waste at sea, the Justice Department announced today.
Dalnave Navigation Inc., a company incorporated in Liberia with offices in Athens, Greece, Chief Engineer Panagiotis Stamatakis and Second Engineer Dimitrios Papadakis, both of Greece, were each charged with conspiracy and violating the Act to Prevent Pollution from Ships (APPS) by failing to maintain an accurate ship record concerning the disposal of oil-contaminated waste. They were also charged with making false statements to U.S. Coast Guard authorities regarding the pumping of oil-contaminated waste overboard and five counts of obstruction of justice concerning the statements made to the Coast Guard.
The indictment alleges that between 2004 and September 2008, Dalnave, and more recently through its two senior engineers on the M/V Myron N, Stamatakis and Papadakis, directed subordinate crew members to use a metal pipe to bypass the ship’s oil water separator and instead discharge the oil-contaminated waste directly overboard. Thereafter, on Sept. 8, 2008, in the port of Newark, N.J., the defendants presented a fabricated oil record book that failed to disclose prior discharges into the ocean of oil-contaminated waste by the M/V Myron N. The indictment alleges the defendants knowingly maintained the oil record book that failed to disclose the overboard discharge of oil-contaminated waste without the use of the ship’s pollution prevention equipment and further alleges that the defendants falsely stated to Coast Guard authorities that, among other things, they never ordered the pumping of oil-contaminated waste overboard.
Federal and international law requires that all ships follow pollution regulations that include proper disposal of oily water through an oil water separator on board the vessel. Large vessels generate oil-contaminated water waste when water mixes in the bottom of the vessel, the bilge, with oil leaked from the machinery and the lubrication and fuel systems. Such oil-contaminated bilge waste may properly be disposed of by off-loading it to a licensed hauler and disposal facility at port, or by discharging it overboard after the oil is separated out using the vessel’s oil water separator. Federal law further 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 Coast Guard within the internal waters of the United States.
If convicted, Dalnave faces a statutory maximum fine of $500,000 on each of the eight counts or, alternatively, twice the gross gain resulting from the offenses. If convicted of the conspiracy, obstruction of justice and false statement charges, Stamatakis and Papadakis face up to 5 years in prison followed by 3 years of supervised release and a $250,000 fine per count. If convicted on the APPS charge, the two face up to 6 years in prison, followed by 3 years of supervised release and a $250,000 fine.
The case was investigated by the U.S. Coast Guard, Sector New York, Coast Guard Investigative Service, Mid-Atlantic Region and the Environmental Protection Agency’s Criminal Investigation Division. It is being prosecuted by Gary N. Donner of the Justice Department’s Environmental Crimes Section, Assistant U.S. Attorney Kathleen P. O’Leary for the District of New Jersey, and Special Assistant U.S. Attorney Christopher P. Mooradian of the U.S. Coast Guard First District Legal Office.
The details contained in the indictment are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Kentucky Man Pleads Guilty to Producing Child <br /> Pornography and Is Sentenced to 20 YearsRead the Press Release
WASHINGTON – Jack A. Taylor, 68, a resident of Rolling Springs, Ky., pleaded guilty today to producing child pornography and was sentenced to 20 years in prison, Acting Assistant Attorney General of the Criminal Division Rita M. Glavin and U.S. Attorney for the Southern District of Indiana Timothy M. Morrison announced.
Taylor, appearing before U.S. District Court Judge David F. Hamilton in Indianapolis, was also ordered to serve a lifetime of supervised release following completion of his prison term, forfeit all items seized during the investigation that were used to commit his offense, and to pay $4,000 in restitution to his victim.
At the plea hearing, Taylor admitted that the statement of facts presented by the government was accurate. The statement of facts established that during the early fall of 2006 Taylor traveled from Kentucky to Lebanon, Ind., where he took sexually explicit photos of a minor, Jane Doe, who was approximately four years old at the time. The statement of facts further established that Taylor engaged in sexually abusive conduct with the four-year-old minor. Finally, the statement detailed how Taylor also transported images of child pornography on a computer CD from Kentucky to Indiana, and that he possessed thousands of images of child pornography on various computer media devices, both in Lebanon and at his home in Rolling Springs.
The case was investigated by the U.S. Secret Service, with the assistance of the Lebanon, Ind., Police Department, the Boone County, Ind., Prosecutor’s Office and the Russell County, Ky., Sheriff’s Department. It is being prosecuted by Assistant U.S. Attorney Steve DeBrota of the U.S. Attorney’s Office for the Southern District of Indiana and Trial Attorney Steve Grocki of the Child Exploitation and Obscenity Section of the Criminal Division.
Fraudulent Tax Return Preparer Sentenced to PrisonRead the Press Release
WASHINGTON - DaJuan Jackson, a former tax return preparer in District Heights, Md., was sentenced to 51 months in prison by U.S. District Judge Roger W. Titus for preparing false tax returns for customers, the Justice Department and Internal Revenue Service (IRS) announced.
In November 2008, a Greenbelt, Md., jury convicted Jackson of eight counts of aiding and assisting in the preparation and presentation of false tax returns. Jackson’s co-defendant, Rodrick Williams, pled guilty to conspiracy to impede the IRS in May 2008.
According to the evidence introduced at trial, Jackson and Williams, both currently of Atlanta, prepared tax returns at a branch office of American Tax Associates Inc. (ATA), located in a Run ’N Shoot gym in District Heights, Md. Jackson and Williams were the two main preparers in the branch office, which was responsible for preparing almost 1,000 tax returns per year at the height of its business in 2004. Williams cooperated with the government, and at trial, he testified that he and Jackson devised a scheme to place false information on the tax returns of ATA clients. In particular, Jackson and Williams falsified itemized deductions and business expenses so clients could fraudulently obtain bigger refunds.
Williams is scheduled to be sentenced by Judge Titus on Feb. 23, 2009.
Acting Assistant Attorney General John DiCicco commended the IRS special agents who investigated the case, as well as Tax Division trial attorneys Jerrod Patterson and Shawn Noud who prosecuted the case.
More information about the Justice Department’s Tax Division and its enforcement efforts is available at http://www.usdoj.gov/tax.
Five Maryland Commercial Fishermen Plead Guilty to Illegally Overfishing Striped BassRead the Press Release
WASHINGTON—Five St. Mary’s County, Md., commercial fisherman pleaded guilty today to illegally overfishing striped bass also known as rockfish, the Justice Department announced.
“Fishing limits in the Chesapeake Bay and Potomac River are designed to protect the healthy sustainable population of striped bass and ensure a viable fishery up and down the eastern seaboard. Commercial fishermen who knowingly conceal their illegal activities, and who traffic in illegally harvested rockfish are undercutting an honest market and risking the continuation of the species,” said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.
“Most rockfish return from the Atlantic Ocean to the freshwater of the Chesapeake Bay to spawn,” said Rod J. Rosenstein, U.S. Attorney for the District of Maryland. “If commercial fishermen obey the rules, we can all enjoy rockfish forever. If we allow overfishing, the rockfish population could be wiped out very quickly.”
According to their plea agreements, Thomas L. Crowder Jr. of Leonardtown, Md.; John W. Dean of Scotland, Md.; Charles Quade of Churchtown, Md.; Thomas L. Hallock of Catharpin, Va.; and Keith A. Collins of Deale, Md., are all commercial fisherman operating in or near St. Mary’s County, Md., and the surrounding waters of the Chesapeake Bay. As commercial fishermen in Maryland, they were each subject to a maximum quota in pounds of striped bass that they were allowed to harvest in a year and were also required to record each day’s harvest of striped bass on a permit allocation card issued by the state of Maryland. Each day’s harvest and its corresponding entry on the permit allocation were required to be verified by a Maryland designated check-in station. All striped bass caught by the defendants were required to be “tagged” with a plastic tag issued by the state. In addition to catching striped bass to fulfill their own quota, each defendant also entered into agreements to utilize the quota issued to other Maryland striped bass fishermen.
According to their statements of fact, from 2003 to 2007, Crowder, Dean, Quade, Hallock and Collins, with the help and assistance of a Maryland designated check-in station, falsely recorded the amount of striped bass that each harvested. In each year, the defendants failed to record some of the striped bass they caught. In addition, in each year the defendants recorded, and the check-in station certified on their Maryland permit allocation cards a lower weight of striped bass than was actually caught. The defendants and the check-in station operator would also falsely inflate on these records the actual number of fish harvested.
By under-reporting the weight of fish harvested, and over-reporting the number of fish taken, the records would make it appear that the defendants had failed to reach the maximum poundage quota for the year, but had nonetheless run out of tags. As a result, the state would issue additional tags that could be used by the defendants allowing them to catch striped bass above their maximum poundage quota amount, yet still have tags to place on those fish and fish that were never reported to Maryland as being harvested. In addition, Hallock, Quade, Dean and Collins falsely tagged striped bass, hiding the manner or location where they were caught. Hallock also fished out of season.
According to their plea agreements, Quade and Hallock further concealed the striped bass over-harvesting and under-reporting by having seafood wholesalers provide false receipts for their striped bass sales, claiming that the sales involved different species of fish.
Crowder, Dean, Quade, Hallock and Collins sold their illegal catch knowing that the fish would be sold to retail and wholesellers in other states. According to their plea agreements, the estimated fair market value of the fish involved in the illegal transactions for Crowder is $956,285; for Collins is between $600,000 and $750,000; for Hallock is $342,210; for Quade is $151,507; and for Dean is $100,267.
“This concerted federal and state investigation sheds light on a pattern of abuse that completely undermines the states’ ability to manage and set quotas for striped bass,” said Acting Special Agent in Charge Sal Amato of the U.S. Fish and Wildlife Service’s Northeast Region. “Violations of fishing laws rob future generations of this important Chesapeake Bay resource.”
“The Maryland Department of Natural Resources applauds and was happy to support these enforcement actions to preserve and protect our striped bass resource,” said DNR Secretary John R. Griffin. “Through the enforcement efforts of the Maryland Natural Resources Police and through innovative partnerships with the U.S. Fish and Wildlife Service and our sister states, we are working to ensure that our waterways are used in a lawful manner which provides for enjoyment of these public trust resources for current and future generations.”
“This is a great example of a cooperative law enforcement initiative to protect our natural resources,” said Commissioner Steven G. Bowman of the Virginia Marine Resources Commission, which includes the Virginia Marine Police. “Trafficking in illegal rockfish is not a harmless offense, and the Virginia Marine Police take this quite seriously.”
In a related case, commercial fisherman Joseph Peter Nelson, Jr., of Great Mills, Md., and his father Joseph Peter Nelson, of Avenue, Md., were indicted on Oct. 15, 2008, for conspiracy to violate the Lacey Act, and six substantive felony Lacey Act counts. The indictment also seeks forfeiture of vessels and vehicles allegedly used by the Nelsons in carrying out the offenses. A trial date has not been set.
Additionally, Cannon Seafood Inc., located in the District of Columbia, its owner and president Robert Moore Sr. of Falls Church, Va., and Robert Moore Jr. of Ashburn, Va., each pleaded guilty to one felony violation of the Lacey Act on Feb. 12, 2009 in U.S. District Court for the District of Columbia. The company faces fines and the individuals face fines and prison sentences according to their plea agreements. Their sentencing date has been set of May 8, 2009, at 9:30 A.M.
Each defendant faces a maximum sentence of five years in prison and a $250,000 fine. The Nelsons also face five years in prison on the conspiracy charge. U.S. District Judge Peter J. Messitte has scheduled sentencing for Crowder and Dean on April 16, 2009; Quade and Hallock on April 17, 2009; and Collins on April 22, 2009, all beginning at 9:30 A.M.Today’s guilty pleas are the result of the investigation by an interstate task force formed by the U.S. Fish and Wildlife Service, the Maryland Natural Resources Police and the Virginia Marine Police, Special Investigative Unit in 2003. The task force conducted undercover purchases and sales of striped bass in 2003, engaged in covert observation of commercial fishing operations in the Chesapeake Bay and Potomac River area, and conducted detailed analysis of area striped bass catch reporting and commercial business sales records from 2003 through 2007. The investigation is continuing, and charges against others are possible.
The case is being prosecuted by Assistant U.S. Attorney Stacy Dawson Belf for the District of Maryland and Senior Trial Attorney Wayne Hettenbach of the Justice Department’s Environmental Crimes Section.BP Products to Pay Nearly $180 Million to Settle Clean Air Violations at Texas City RefineryRead the Press Release
WASHINGTON—BP Products North America Inc. has agreed to spend more than $161 million on pollution controls, enhanced maintenance and monitoring, and improved internal management practices to resolve Clean Air Act violations at its Texas City, Texas, refinery, the Justice Department and U.S. Environmental Protection Agency (EPA) announced today. The company will also pay a $12 million civil penalty and spend $6 million on a supplemental project to reduce air pollution in Texas City.
Today’s settlement addresses the company’s noncompliance with a 2001 consent decree and Clean Air Act regulations requiring strict controls on benzene and benzene-containing wastes generated during petroleum refining operations. The company is required to upgrade control equipment and processes used to handle these materials and conduct in-depth audits to ensure compliance and minimize the amount of benzene-containing wastes generated at the refinery. It is estimated that these actions will reduce emissions of benzene and other volatile organic compounds (VOCs) by approximately 6,000 pounds annually.
“The Department of Justice and the EPA will aggressively pursue those who fail to comply with the laws that protect our environment, and we will hold them accountable,” said John C. Cruden, Acting Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division. “This new agreement requires stringent new measures to protect air quality and public health in Texas beyond those originally required at the Texas City Refinery.”
“BP failed to fulfill its obligations under the law, putting air quality and public health at risk,” said Catherine R. McCabe, Acting Assistant Administrator for EPA’s Office of Enforcement and Compliance Assurance. “Today’s settlement will benefit the people living in and around Texas City, many of whom come from minority and low-income backgrounds.”
EPA identified the violations addressed in today’s settlement during a series of inspections of the Texas City refinery initiated after a catastrophic explosion and fire in March 2005 that killed 15 people and injured more than 170 others. In October 2007, the company pleaded guilty to a felony violation of the Clean Air Act and agreed to pay a $50 million fine for violations related to the explosion, the largest criminal fine ever assessed against a corporation for Clean Air Act violations. The plea is still under review by the U.S. District Court for the Southern District of Texas, and today’s settlement does not address any claims arising from the March 2005 explosion.
The settlement requires that BP address violations of Clean Air Act requirements limiting emissions of stratospheric ozone-depleting hydrochlorofluorocarbons (HCFCs) from leaking cooling appliances. BP will eliminate approximately 51,000 pounds of HCFCs by retrofitting industrial and commercial cooling appliances at Texas City to use non-ozone-depleting refrigerants. The company also has agreed to improve its oversight and management of asbestos-containing wastes generated during routine renovation and demolition activities at the Texas City refinery.
As part of the settlement, the company will spend an additional $6 million to reduce air pollution from diesel vehicle emissions in Texas City and the surrounding area. BP will convert approximately 100 diesel municipal vehicles, including several dozen school buses, to operate on compressed or liquefied natural gas and will construct four refueling stations for the converted vehicles. As a result, emissions of particulate matter, nitrogen oxides and hydrocarbons from these vehicles will be substantially reduced.
Exposure to benzene, a hazardous air pollutant, is known to cause a number of acute and chronic health effects, including cancer, nerve and immunity impairment, and adverse reproductive and developmental effects, among others.
HCFCs and other ozone-depleting substances, when released into the environment, destroy the earth’s protective stratospheric ozone layer. Exposure to asbestos, a known human carcinogen, can cause asbestosis and two types of cancer: lung cancer and mesothelioma.
BP Products North America, headquartered in Warrenville, Ill., operates petroleum refineries in California, Indiana, Ohio, Texas and Washington. The Texas City refinery, the third largest in the nation, has a production capacity of more than 460,000 barrels per day.
The proposed settlement, lodged today in the U.S. District Court for the Northern District of Indiana, is subject to a 30-day public comment period and final court approval. A copy of the consent decree is available on the Justice Department Web site at http://www.usdoj.gov/enrd/Consent_Decrees.html.
18 February 2009
United States Files Clean Air Lawsuit Against Louisiana GeneratingRead the Press Release
WASHINGTON — The United States has filed a complaint against Louisiana Generating alleging that the company violated the Clean Air Act by operating the Big Cajun 2 Power Plant, a coal-fired power plant in New Roads, La., without also installing and operating modern pollution control equipment after the generating units had undergone major modifications, the Justice Department and U.S. Environmental Protection Agency (EPA) announced today.
The complaint alleges that for more than a decade, the Big Cajun 2 Power Plant has operated without the best available emissions-control technology required by the New Source Review provisions of the Clean Air Act to control emissions of sulfur dioxide and nitrogen oxide, contributing to formation of fine particulate matter, smog and acid rain.
The lawsuit, filed by the Justice Department on behalf of the EPA, asks the court to order Louisiana Generating to install and operate appropriate air pollution control technology in order to substantially reduce sulfur dioxide and nitrogen oxide emissions from the Big Cajun 2 Power Plant. The United States also seeks civil penalties up to the maximum amount authorized by law, as well as actions by the energy provider to mitigate the adverse effects alleged to have been caused by the violations.
Coal-fired power plants collectively produce more pollution than any other industry in the United States. They account for nearly 70 percent of sulfur dioxide emissions each year and 20 percent of nitrogen oxides emissions. Emissions from coal-fired power plants have detrimental health effects on asthma sufferers, the elderly and children. Additionally, these emissions have been linked to forest degradation, waterway damage, reservoir contamination and deterioration of stone and copper in buildings.
To combat these adverse effects, the EPA and the Justice Department are pursuing a national initiative, targeting electric utilities whose coal-fired power plants violate the law. The suit was filed in the U.S. District Court in Baton Rouge, La.