Eastern District of Michigan

DETROIT - A former Detroit Police Department officer pleaded guilty today in federal court in Detroit to accepting bribes, Acting United States Attorney Saima S. Mohsin announced.

Mohsin was joined in the announcement by Timothy Waters, Special Agent in Charge of the Detroit Field Office of the Federal Bureau of Investigation.

Pleading guilty before U.S. District Court Judge George Caram Steeh was Alonzo Jones, 55, of Detroit, Michigan.

According to the court documents, from in or about July 2019, and continuing through in or about May 2021, Alonzo Jones corruptly accepted approximately $3,200 in bribes with the intent to be influenced and rewarded in connection with his duties overseeing and running the Detroit Police Vehicle Auction.

Jones faces up to 10 years imprisonment and a fine of $250,000.  Sentencing has been set for March 15, 2022.

“Investigating and prosecuting bad cops is a top priority for our office because bad cops erode the public’s trust in law enforcement,” said Acting US Attorney Mohsin.  “The vast majority of police officers are honest, dedicated, and hard-working individuals.  But police officers who line their pockets with bribes, no matter how big or small will be held accountable for their actions.  Today’s plea highlights our office’s commitment to prosecuting those small minority of bad cops who put their own greed before their duties as police officers.”

“A law enforcement officer accepting bribes undermines the rule of law and will always be vigorously investigated. Today, Mr. Jones pled guilty to conduct that is not representative of the men and women of the Detroit Police Department who serve with honor day in and day out,” said Special Agent in Charge Timothy Waters of the FBI’s Detroit Field Office. “Thank you to Chief James White whose cooperation during this investigation made it possible to hold Jones accountable for his actions.”

This is the fourth individual charged as part of the government’s investigation known as “Operation Northern Hook.” Northern Hook is an investigation of corruption within the government and the Police Department of the City of Detroit relating to the towing industry and other matters.

The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Frances Lee Carlson.

DETROIT - Timothy Edmunds, the Financial Secretary-Treasurer of Local 412 of the United Auto Workers union, has been charged in a Criminal Complaint with embezzling over $2 million in union funds announced Acting U.S. Attorney Saima S. Mohsin.   

Joining in the announcement were Irene Lindow, Special Agent in Charge of the U.S. Department of Labor – Office of Inspector General, Timothy Waters, Special Agent in Charge of the Detroit, Michigan office of the Federal Bureau of Investigation, and Sarah Kull, Special Agent in Charge of the Detroit, Michigan office of the Internal Revenue Service – Criminal Investigations, and Thomas Murray, District Director, U.S. Department of Labor – Office of Labor-Management Standards.

Timothy Edmunds, 53, of South Lyon, Michigan, is charged in the Criminal Complaint, that was unsealed today, with embezzling union funds, money laundering, failing to maintain union records, and filing false reports with the Department of Labor between 2015 and 2021.  

According to court records, between 2011 and 2021, Edmunds has served as the Financial Secretary-Treasurer of union Local 412 of the International Union, United Automobile, Aerospace, and Agricultural Workers of America (“UAW”).  UAW Local 412 is headquartered in Warren, Michigan, and it represents approximately 2,600 members employed by the automaker FCA US LLC, which is owned by Stellantis N.V.  The local union’s members include many of those employed at the following Stellantis facilities located within in the Detroit area:  Sterling Stamping Plant, Mack Engine Plant, Warren Truck Assembly Plant, Warren Stamping Plant, and Jefferson Assembly Plant.     

As an elected officer of UAW Local 412, Edmunds was responsible to hold its money and property solely for the benefit of the organization and its members and to manage, invest, and expend the funds in accordance with the UAW constitution and Local 412 bylaws.   Instead, Edmunds systematically drained the Local 412 accounts of about $2 million by (1) using Local 412 debit cards for over $142,000 in personal purchases, (2) cashing Local 412 checks worth $170,000 into accounts he personally controlled, and (3) transferring $1.5 million from bone fide Local 412 accounts into accounts that he personally controlled.  Once Edmunds converted the funds to his own personal use, he used the money to gamble, purchase luxury clothing, high-end automobiles, and firearms.  To conceal his theft from other UAW officers and the Local 412 members, Edmunds created false bank statements and caused false LM reports to be filed with the U.S. DOL.  Edmunds supplied the fake bank statements to international UAW auditors in an effort to conceal his embezzlement.  Auditors from the UAW international union, who recently conducted an audit of Local 412, provided federal agents with information detailing the diversion of approximately $2 million in Local 412 funds by Edmunds.       

Evidence indicates that Edmunds has used portions of the proceeds of his embezzlement to gamble extensively, to purchase firearms, and to purchase various high-end vehicles.  For example, between 2018 and 2020, Edmunds used the UAW Local 412 debit card to make over $30,000 in unauthorized withdrawals at the Greektown Casino.  While gambling at the Greektown Casino, records indicate that Edmunds had cash buy-ins of over $1 million, and he put over $16 million in play while betting while being rated at the casino.  Between 2020 and the present, Edmunds registered at least 10 firearms, which ranged in price between $500 and $2,000 per firearm.  In February 2016, Edmunds purchased a 2016 Jeep Grand Cherokee SRT for $74,365.  In July 2020, Edmunds purchased a 2020 Jeep Grand Cherokee Trackhawk, for $96,419.  Subsequently, in July 2021, Edmunds purchased a 2021 Dodge Durango for $76,491.  Edmunds also leased two 2021 Jeep Grand Cherokee Limited in December 2020.

Based on the charge of embezzling union funds, Edmunds faces a maximum of five years in prison and a fine of up to $10,000.  Based on the charge of money laundering, Edmunds faces a maximum of twenty years in prison and a fine of up to $500,000.  On the charges of filing false reports with the Department of Labor, failing to maintain union records, and making false entries in union records, Edmunds faces a maximum of one year in prison and fine of $10,000.

A Criminal Complaint is only a charge and is not evidence of guilt. 

Edmunds is the seventeenth defendant charged in connection with the ongoing criminal investigation into corruption within the UAW or relating to illegal payoffs to UAW officials by FCA executives.  The following other individuals have already pleaded guilty to their participation in the scheme and have been sentenced:  former UAW President Gary Jones (28 months in prison); former FCA Vice President for Employee Relations Alphons Iacobelli (66 months in prison), former FCA Financial Analyst Jerome Durden (15 months in prison), former Director of FCA’s Employee Relations Department Michael Brown (12 months in prison), former senior UAW officials Virdell King (60 days in prison), Keith Mickens (12 months in prison), Nancy A. Johnson (12 months in prison), Monica Morgan, the widow of UAW Vice President General Holiefield (18 months in prison), former UAW Vice President Norwood Jewell (15 months in prison), former senior UAW official Michael Grimes (28 moths), former UAW Midwest CAP President Edward “Nick” Robinson (12 months in prison), former UAW Vice President Joseph Ashton (30 months), former UAW President Dennis Williams (21 months) and former UAW Region 5 Director UAW Board member Vance Pearson (12 months in prison).  The company, FCA US LLC, now known as Stellantis, pleaded guilty in January 2021 to conspiring to violate the Taft-Hartley Act, and was ordered to pay a fine of $30 million and be subject to an outside Monitor for three years.  Former senior UAW official Jeffrey “Paycheck” Pietrzyk passed away before being sentenced.

In December 2020, the United States filed a civil lawsuit against the International UAW under the Anti-Fraud Injunction Act based on the criminal investigation of the UAW, FCA US LLC, and FCA’s executives.  Subsequently, the United States and the International UAW entered into a Consent Decree to settle the lawsuit that was approved by the U.S. District Court.  The Court has appointed attorney Neil Barofsky to serve as the Independent Monitor of the UAW for the next six years.  The Monitor is tasked with providing federal oversight of the UAW concerning fraud, corruption, and misconduct within the UAW.  In addition, the Monitor is conducting a referendum of all UAW members to determine if the membership wants to adopt a direct election, also known as “one member, one vote,” method of electing the members of the UAW’s International Executive Board.        

Acting U.S. Attorney Mohsin commended the outstanding work of the Internal Revenue Service – Criminal Investigations, the U.S. Department of Labor – Office of Labor-Management Standards and Office of Inspector General, and the Federal Bureau of Investigation in conducting a comprehensive criminal investigation into labor corruption activities involving a vital sector of the local and national economy.

“The members of the UAW deserve a union free of corrupt and crooked leadership,” said Acting United States Attorney Saima Mohsin.  “We will continue to root out and prosecute those corrupt leaders who seek to use UAW funds as their own personal piggybank.” 

"An important mission of the Office of Inspector General is to investigate allegations of fraud involving labor unions. We will continue to work with our law enforcement partners to investigate these types of allegations,” stated Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.

“Mr. Edmunds held a position of trust within the UAW and his alleged theft of nearly $2 million from UAW accounts is a betrayal to every UAW worker,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Division. “The FBI and its law enforcement partners will use all available resources to hold criminals accountable and seek justice for those victimized.”

“This complaint leaves no question as to the Department of Labor’s commitment to seek justice for unions and their members when union officers or employees put their personal financial gain ahead of the best interests of the union and the members they represent,” said Thomas Murray, District Director, U.S. Department of Labor, Office of Labor-Management Standards. “Today’s complaint alleges an outrageous abuse of power and misuse of Mr. Edmunds’s position of trust. Mr. Edmunds allegedly embezzled over $2 million from the members of UAW Local 412, took extreme measures to conceal his actions from the union, and used embezzled funds to live a lavish lifestyle. While almost all union officials and employees pursue the best interests of the union and the members they represent, a very small amount do not. When a union official or employee endangers the financial integrity of their union, OLMS will seek justice for the union and its members.”

“Today’s allegation is yet another example of corrupt leadership and abuse of fiduciary duties of a trusted UAW official,” said Special Agent in Charge Sarah Kull, Internal Revenue Service – Criminal Investigation, Detroit Field Office.  “IRS – Criminal Investigation is committed to investigating corrupt union officials who steal from their membership to enrich themselves.”

The case is being prosecuted by Assistant U.S. Attorneys David A. Gardey and Steven Cares.

A Detroit man pleaded guilty today to wire fraud and identity theft in a scheme to defraud nine states out of more than $1.6 million in unemployment insurance benefits, announced Acting United States Attorney Saima Mohsin.

Joining in the announcement was Special Agent in Charge Timothy Waters, Federal Bureau of Investigation and Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor, Office of Inspector General

Jordan Armstrong, 29, of Detroit, entered his guilty pleas this morning, via Zoom, before United States District Judge Victoria A. Roberts.

According to court records, beginning on or about May 4, 2020 and continuing through at least October 21, 2020, Armstrong, with the intent to defraud, successfully submitted applications for unemployment insurance benefits on behalf of individuals in Michigan, California, Texas, Arizona, Pennsylvania, Tennessee, Massachusetts, New York, and Louisiana. Armstrong also unsuccessfully submitted claims in eight other states—in total filing more than 300 claims across 17 states and territories.  Armstrong submitted these claims using these individuals’ Social Security Numbers and did so without their permission.  Armstrong directed the benefits to be paid out via debit cards and then used these cards to repeatedly withdrawal the funds via ATMs throughout Metro Detroit. 

As part of his guilty plea, Armstrong will be required to pay restitution to the victim-states in the total amount of $1,611,202.

Armstrong faces a statutory maximum penalty of 20 years imprisonment on the charge of wire fraud and a mandatory minimum sentence of 2 years imprisonment on the charge of identity theft.

Armstrong will be sentenced on March 22, 2022.

The investigation of this case was conducted by the Federal Bureau of Investigation, U.S. Department of Labor, Office of Inspector General with the assistance of the Birmingham Police Department. The case is being prosecuted by Assistant United States Attorney Ryan A. Particka. 

DETROIT – Two Michigan men have been charged via criminal complaint for their roles in a large-scale, multi-state Unemployment Insurance benefit fraud scheme, announced Acting United States Attorney Saima S. Mohsin.

Joining in the announcement were Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor, Office of Inspector General, Special Agent in Charge John R. Marengo, US Secret Service, Rodney Hopkins, Postal Inspector in Charge of the Detroit Division, Special Agent in Charge Sarah Kull, Internal Revenue Service-Criminal Investigation and Julia Dale, Director of the Unemployment Insurance Agency.

The complaint charges Jermaine Arnett, 34, of Pontiac, Michigan, and Terrance Calhoun, Jr., 32, also of Pontiac, Michigan, with aggravated identity theft, mail fraud, fraud using a false name and address, wire fraud, bank fraud, money laundering, and conspiracy to commit each of those acts, as well as firearm crimes.

According to the complaint, Arnett, Calhoun Jr., and one or more other individuals are responsible for filing over 500 claims for fraudulent unemployment insurance benefits across the United States, including Michigan, using just a handful of Internet Protocol addresses and mailing addresses. As described by the complaint, those false claims resulted in numerous debit cards loaded with unemployment insurance funds being mailed to addresses that Arnett, Calhoun Jr., and others controlled. The complaint alleges that Arnett, Calhoun Jr., and other individuals then systematically unloaded the funds from the cards by making large cash withdrawals at ATMs.

According to the complaint, between April and July 2020 those false claims resulted in multiple states collectively issuing more than $4 million in unemployment insurance benefits. The complaint alleges that, although a portion of the funds were electronically reclaimed before being unloaded, more than $1.7 million dollars in purchases and cash withdrawals were successfully made from the cards over a 2½ month period, and the majority of those cash withdrawals took place at ATMs located in Troy, Bloomfield Hills, and Rochester Hills, Michigan. As further described within the complaint, agents utilized ATM surveillance photos to identify Arnett and Calhoun Jr. as two of the individuals who made large cash withdrawals from ATMs using debit cards loaded with unemployment benefits issued in the names of other individuals. As also described within the complaint, when agents executed search warrants at three principal mailing addresses used for the fraudulent unemployment insurance benefit claims, including the residences of Arnett and Calhoun Jr., agents found and seized multiple debit cards in the names of numerous other individuals, distinctive clothing worn in ATM surveillance photos, firearms, and numerous documents containing the personal identification information of other individuals.

A complaint is only a charge and is not evidence of guilt.  Trial cannot be held on felony charges in a complaint.  When the investigation is completed, a determination will be made whether to seek a felony indictment.

This investigation is being conducted jointly by agents from the Department of Labor Office of the Inspector General, the United States Secret Service, the Internal Revenue Service – Criminal Investigations Division, the United States Postal Service Office of the Inspector General, and the State of Michigan -Unemployment Insurance Agency. The case is being prosecuted by Assistant United States Attorney Carl D. Gilmer-Hill. 

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

DETROIT - Former Certified Registered Nurse Anesthetist, Elizabeth Prophitt, age 39, of Saline, was sentenced today to 3-years’ probation for stealing controlled substances, including several opioids, from hospital dispensing machines, announced Acting United States Attorney Saima S. Mohsin.

Joining Mohsin in the announcement were Gavin McClaren, Acting Special Agent in Charge, Veteran’s Affairs, Office of Inspector General, Central Field Office and Special Agent in Charge Keith Martin, DEA, Detroit Division.

Prophitt, was sentenced by U.S District Court Judge Robert H. Cleland after pleading guilty to five counts of obtaining controlled substances by fraud, misrepresentation or deceit. She used her position as a surgical nurse to steal more than 2,000 vials of Schedule II and Schedule IV controlled substances, which included fentanyl, hydromorphone, morphine and midazolam. Prophitt would use protected patient information and falsify medical documents to obtain the controlled substances. Instead of using the medication on the purported patients, she diverted the drugs for her own personal use. At times, on days when she was unscheduled to work or after normal working hours, she would access the hospital and steal the vials directly from the hospital dispensing systems.

Acting United States Attorney Mohsin stated, “In order to protect the health and safety of our citizens, we take crimes like this seriously and will not hesitate to prosecute health care workers whose theft of drugs put patients in harm’s way.”

“We will not tolerate medical professionals stealing controlled substances intended for the care of our nation’s veterans,” said Acting Special Agent in Charge Gavin McClaren of the Department of Veterans Affairs Office of Inspector General’s Central Field Office.    

This case was prosecuted by Assistant United States Attorney Brandy R. McMillion.  McMillion serves as the District’s Opioid Fraud Abuse and Detection Prosecutor as well as the Deputy-Chief of the Health Care Fraud Unit. The Opioid Fraud Abuse and Detection Unit is a Department of Justice initiative designating twelve special prosecutors across the country to focus on prosecuting medical professionals that are contributing to the nation’s opioid crisis. The case was investigated by special agents of the Department of Veteran Affairs – Office of Inspector General and the Drug Enforcement Administration.

DETROIT – A federal jury today convicted a Lansing, Michigan man on multiple charges relating to the production and receipt of child pornography, announced Acting United States Attorney Saima Mohsin. 

Mohsin was joined in the announcement by Special Agent in Charge Vance Callendar, Homeland Security Investigations.

Convicted was Michael McShan, 28.  The 5-day trial, which began on Thursday, October 28, was conducted before United States District Judge David M. Lawson in Detroit.  The jury deliberated approximately an hour before returning the guilty verdicts. 

According to evidence presented during the trial, in December 2018, McShan met a minor female (MV-1) on a social media site called “MeetMe,” and then began communicating with MV-1 via Snapchat, cellphone calls and text messages.  McShan quickly began an abusive and sexual relationship with MV-1.   McShan enticed and persuaded MV-1 to produce images and videos of herself and another minor female victim (MV-2) engaging in sexually explicit conduct.  Over the course of a few months, McShan, became increasingly controlling over MV-1. McShan coerced and enticed MV-1 through flattery, threats, and guilt to manipulate MV-1 into continuing to send him sexually explicit photos and videos as well as money.

Evidence further showed that in an attempt to get released on bond pending his trial, McShan directed his then-girlfriend, Madison, (AV-1) to write a false confession to the child exploitation crimes.

McShan was convicted of production of child pornography; attempted production of child pornography;  receipt of child pornography; coercion and enticement of a minor, and obstruction of justice.  McShan faces a maximum sentence of life in federal prison.  A sentencing date has been set for March 1, 2022.

“Protecting children from dangerous child predators is a top priority for our office,” said Acting United States Attorney Mohsin. “I commend our law enforcement partners for their hard work and dedication to investigating and prosecuting crimes against children.”

“Even though schools do a great job educating our children about online safety, this case serves as an example of how manipulative child predators can be; please mind your child’s online activities,” said HSI Detroit Special Agent in Charge Vance Callender.  “My special agents did an outstanding job investigating and preparing for trial on this case. I commend their efforts for the sake of the victims here.”

The case was investigated by special agents of Homeland Security Investigations.  The case is being prosecuted by Assistant United States Attorneys Maggie Smith and Sara Woodward.

DETROIT - A Redford man was sentenced today to 156 months’ imprisonment on charges of receiving child pornography, announced Acting United States Attorney Saima Mohsin. 

Moshin was joined in the announcement by Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division.

Sentenced was Devin Walker, Age 24.

According to court records, beginning in 2015 and continuing up until his arrest in November 2018, Walker enticed and persuaded minor females to produce images of themselves engaging in sexually explicit conduct.  He threatened his victims with violence and exposure of their images if they did not continue to send sexually explicit photos and videos.  Walker communicated with his victims on the Internet using his real name as well as an alias.  A search of Walker’s devices revealed 31 videos and 105 images of child pornography. Walker’s victims ranged in age from 13-years old to 17-years old.

“Walker is a sexual predator who coerced and exploited children for his own sexual gratification.  The images he obtained from girls as young as 13 are not merely pictures but are a permanent record of the sexual abuse and exploitation he visited upon these children,” stated Acting United States Attorney Mohsin.  “I commend the work of the FBI and the prosecutors for their dedication to investigating and prosecuting Walker for these horrible crimes.”

"Walker's conduct is an all-too-familiar example of sextortion. Sextortion begins when a predator, through threat or manipulation, coerces a minor into producing a sexually explicit image and sending it over the Internet. He then uses the threat of sharing or publishing those images to get the victim to produce more," said Special Agent in Charge Timothy Waters of the FBI's Detroit Field Office. "Make no mistake, Walker is a predator. I thank the brave young victim who took the first step towards holding Walker accountable for his crimes by reporting him to law enforcement."

This case was investigated by special agents with the FBI and was prosecuted by Assistant United States Attorney Alyse Wu.

The FBI continues to see cases that involve adults coercing minors into producing sexual images and videos online. Take a moment to learn how sextortion works and how to talk to young people about it. Information, resources, and conversation guides are available at www.fbi.gov/StopSextortion.

A Grand Blanc, Michigan man was sentenced to 48 months in prison after having pleaded guilty to supervising a complex fraud and kickback scheme involving UAW members and medically unnecessary compounded pain creams, scar creams, pain patches and/or vitamins, announced Acting United States Attorney Saima Mohsin.

Mohsin was joined in the announcement by Special Agent in Charge Lynda M. Burdelik, FDA Office of Criminal Investigations Chicago Field Office and Mario M. Pinto, Special Agent in Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General

Sentenced was Patrick Wittbrodt, 46.  In addition to the custodial sentence, United States District Judge Laurie J. Michelson also ordered that Wittbrodt be placed on a two-year term of supervised release.  In addition, Wittbrodt was ordered to pay $7,317,173.51 in restitution to Blue Cross Blue Shield of Michigan and $902,387.93 in restitution to Medicare. As part of his plea agreement, Wittbrodt also agreed to forfeit approximately $72,000 seized by federal agents.  

According to court documents, Wittbrodt and his co-defendants caused an approximate $8,000,000 loss to Medicare and Blue Cross Blue Shield of Michigan (“BCBS”). Some of this money was stolen from UAW members’ prescription insurance accounts. 

Court documents outlined the scheme:

Due to the high reimbursement rate paid by Medicare and BCBS for prescription pain cream, scar cream, pain patches and/or vitamins, defendants targeted these insurance plans. Wittbrodt and others would then schedule time at various UAW meetings where defendants would tout pain cream, scar cream, pain patches and vitamins to the UAW members.  An aspect of the presentation was that the UAW members could receive their prescriptions free -- without paying a prescription drug copay at the pharmacy.  UAW members did not realize that acceptance of the “free” medications would cost their health care fund millions of dollars.    

Defendants would then collect the UAW members’ insurance information along with their family members’ insurance information.  According to court documents, Dr. April Tyler, who also pleaded guilty in the case, would then authorize the pain cream, scar cream, pain patch and/or vitamin prescriptions for the UAW members and/or their family members.  Defendant Dr. Tyler did not establish a valid doctor-patient relationship with any of the UAW members, did not perform a physical exam and did not determine medical necessity for the prescriptions she wrote for the UAW members.  The prescriptions were not, therefore, legally eligible for reimbursement from the various insurance companies.  Defendant Dr. Tyler also pre-signed prescription forms and allowed defendants to choose which compounded creams, patches and vitamins to write on the prescriptions.

Wittbrodt directed the prescriptions to various pharmacies.  The pharmacies would fill the prescriptions, bill the UAW members’ insurance and pay a monetary kickback to Wittbrodt.  Wittbrodt would then provide remuneration to co-conspirators from the kickbacks he received.  The prescriptions were periodically re-filled and/or re-billed, regardless of whether the UAW member requested a refill or not.  The prescription co-pay was waived at the pharmacy for the UAW members. Another defendant, Jeffrey Fillmore, is scheduled for sentencing on November 23, 2021.

“The unlawful actions of these defendants diverted taxpayer dollars and medications from patients who actually needed them in order to line their own pockets,” said Acting United States Attorney Saima Mohsin.  “We will continue to aggressively prosecute health care fraud and hold those who commit it accountable.”

“Medical professionals who try to enrich themselves by billing federal health care programs for medically unnecessary prescription medications threaten the integrity of these programs and waste valuable taxpayer dollars that are otherwise utilized to provide medications that patients genuinely need,” said Mario M. Pinto, Special Agent in Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General. “Our agency, working together with our law enforcement partners, will continue to pursue criminals who threaten these vital health care programs.”

“Schemes that solicit and provide unneeded prescription drugs to patients erodes the confidence that U.S. consumers have in their health care professionals and others in positions of trust,” said Special Agent in Charge Lynda M. Burdelik, FDA Office of Criminal Investigations Chicago Field Office. “Medical professionals and others should know that the FDA will investigate and bring to justice those involved in the illegal distribution of prescription drugs.”

“This case demonstrates that collaboration between law enforcement and private insurance investigators is essential in prosecuting those responsible for federal healthcare fraud and kickback violations,” said by Dan Crowell, Blue Cross Blue Shield of Michigan, Director of Corporate and Financial Investigations.    

This case was investigated by the United States Department of Health and Human Services – Office of Inspector General, the United States Food and Drug Administration and Blue Cross Blue Shield of Michigan, under the supervision of the U.S. Attorney’s Office for the Eastern District of Michigan.  Assistant U.S. Attorney Philip A. Ross and Wayne Pratt are prosecuting the case.

BAY CITY – A federal jury convicted a Roscommon County man on charges of possessing, receiving, and transporting child pornography, announced Acting United States Attorney Saima Mohsin. 

Mohsin was joined in the announcement by Special Agent in Charge Vance Callendar, Homeland Security Investigations and Sheriff Ed Stern, Roscommon County Sheriff’s Department.

Convicted was Scott Lantzy, 49.  The 4 day trial which began on Thursday, October 21st and ended on Tuesday October 26th, was conducted before United States District Judge Thomas Ludington in Bay City.  The jury deliberated approximately 45 minutes before returning the guilty verdicts. 

According to evidence presented during the trial, Lantzy, is a serial sex offender with four prior CSC convictions, one conviction for accosting a minor, and two SORNA-related convictions spanning from 1998 until present.  Lantzy came to the attention of law enforcement when he impersonated an EMT at a high school football game. During the game, Lantzy came onto the field to aid an injured player.  He accompanied the teen to the hospital, where he made his way into the emergency room. He continued to attempt contact with the injured player the following day. A few months before the football game, Lantzy befriended another high school student who testified at the trial. This student testified that while housesitting for Lantzy, Lantzy called him and told him that he had left him a camera and condoms and that the student should send Lantzy pictures of what he and his friend were doing while house sitting. When Lantzy arrived home, the student testified that he saw pictures of child pornography on Lantzy’s personal cell phone. This led detectives from the Roscommon County Sheriff’s Department to execute a search warrant on Lantzy’s home.

Lantzy was convicted of two counts of possession/access with intent to view child pornography; one count of possession of child pornography; one count of transportation of child pornography; and one count of receipt of child pornography.  Lantzy faces a maximum sentence of 40 years in federal prison.  A sentencing date has been February 3, 2022 in Bay City.

“Protecting children from dangerous and cunning serial child predators is a top priority for our office,” said Acting United States Attorney Mohsin. “The possession, transportation and receipt of child pornography will not be tolerated by this office.  I commend our law enforcement partners for their hard work and dedication to investigating and prosecuting crimes against children.”

The case was investigated by the Roscommon County Sheriff’s Department and special agents of Homeland Security Investigations in Sault Ste. Marie and Detroit, with assistance from the Michigan State Police. The case is being prosecuted by Assistant United States Attorneys Tim Turkelson and Alison Furtaw.

A Detroit woman was sentenced today to 58 months in federal prison after having pleaded guilty for her role in a multi-million dollar unemployment insurance fraud scheme aimed at defrauding the State of Michigan and the U.S. Government of funds earmarked for unemployment assistance during the COVID19 pandemic, announced Acting United States Attorney Saima Mohsin.

Joining in the announcement were Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General, Special Agent in Charge John R. Marengo, US Secret Service, Rodney Hopkins, Postal Inspector in Charge of the Detroit Division, Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Acting Special Agent in Charge Brian Thomas, Internal Revenue Service-Criminal Investigation and Liza Estlund Olson, former acting director of the Unemployment Insurance Agency.

Brandi Hawkins, 40, was sentenced before United States District Judge Paul D. Borman. As part of her sentence, Judge Borman ordered Hawkins to pay restitution to the State of Michigan in the amount of $3,793,186.

According to court records, Brandi Hawkins was a contract employee for the State of Michigan Unemployment Insurance Agency. Her duties included reviewing, processing and verifying the legitimacy of unemployment insurance claims. Between April and June of 2020, HAWKINS worked with outside actors, known and unknown to law enforcement. Daily, those actors entered numerous false claims into the State of Michigan’s Unemployment Insurance Agency system, many of which were filed using stolen identities. These actors communicated with HAWKINS by cellular telephone calls and texts. HAWKINS accepted bribes in return for releasing many of these claims. HAWKINS used her insider access to fraudulently release payment on over seven-hundred claims, more than ten of which involved claims filed using stolen identities. HAWKINS’s actions resulted in the fraudulent disbursement of approximately $3.8 million of federal and state funds intended for unemployment assistance during the pandemic. Had every fraudulent claim released by HAWKINS been disbursed in full, the resulting loss of federal and state funds would have been over $12 million.

During the execution of a search warrant at Hawkins’ residence, over $200,000 in cash was seized. Hawkins used proceeds from her crimes to purchase high-end handbags and other luxury goods.

“Hawkins exploited the pandemic to defraud the State of Michigan and United States for her own personal gain,” said Acting US Attorney Mohsin. “This sentence should send a message to those who seek to divert funds intended for those in need during what has been a very difficult period of unemployment – you will be prosecuted”

“Hawkins used her position with the state of Michigan to steal millions from Michigan taxpayers and today’s sentencing should serve as a warning to anyone thinking of committing a similar crime.” stated Acting Special Agent in Charge Brian Thomas, IRS-Criminal Investigation, Detroit Field Office. “IRS-Criminal Investigation is steadfast in protecting Covid-19 Pandemic related programs geared toward assisting people and businesses in need.”

“Brandi Hawkins while employed as a contractor used her position to take advantage of the public and defraud the State of Michigan. She was able to manipulated the Michigan Unemployment Insurance Agency system for her and others’ personal gain. We will continue to work with our law enforcement partners throughout Michigan to bring criminals like Hawkins to justice,” said John R. Marengo, Special Agent in Charge, U.S. Secret Service, Detroit Field Office.

"Brandi Hawkins used her insider access as a State of Michigan contract employee to fraudulently disburse millions of dollars in Pandemic Unemployment Assistance benefits. Today's sentencing affirms the U.S. Department of Labor Office of Inspector General’s commitment to vigorously pursue those who steal funds intended for individuals who lost their jobs during the COVID-19 pandemic. We will continue to work with our federal and state partners to protect the integrity of unemployment insurance benefit programs," stated Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.

"Brandi Hawkins used her position as a contractor with the state of Michigan to manipulate the unemployment insurance system to benefit herself and her co-conspirators," said Timothy Waters, Special Agent in Charge of the FBI's Detroit Division. "The FBI is proud to work with our law enforcement partners to hold wrongdoers accountable and to protect the integrity of vital federal assistance programs."

“Ms. Hawkins betrayed the trust given to her by her employer when she used her access to privileged information in a scheme to steal from the government and the people of Michigan. Today’s sentencing represents the commitment of law enforcement to bring those to justice who disrespect the rule of law, hurting the American public,” said Inspector in Charge Rodney M. Hopkins.

“People who willfully commit unemployment insurance fraud should know that the State of Michigan and the Unemployment Insurance Agency are serious about identifying and holding them accountable for their actions,” said Liza Estlund Olson, former acting director of the Unemployment Insurance Agency. “Through the great work of our federal and state partners along with UIA investigators, we’re are working to root out fraudulent schemes like this one and protect unemployment benefits for those who are legitimately entitled to them.”

The case was prosecuted by Assistant United States Attorney Timothy Wyse. The investigation was conducted jointly by the Department of Labor, Office of Inspector General, United States Secret Service, Internal Revenue Service - Criminal Investigation, Federal Bureau of Investigation, the U.S. Postal Inspection Service and the Unemployment Insurance Agency, Michigan Department of Labor and Economic Opportunity

DETROIT - A federal indictment was unsealed today charging two Detroit police officers—one of whom was a lieutenant who had been in command of the Detroit Police Department’s Integrity Unit—with bribery and conspiracy to commit bribery, in connection with the corruption of towing permits in Detroit, Acting United States Attorney Saima S. Mohsin announced.

Mohsin was joined in the announcement by Timothy Waters, Special Agent in Charge of the Detroit Field Office of the Federal Bureau of Investigation.

Charged were Lieutenant John F. Kennedy, 56, of Rochester Hills, and Officer Daniel S. Vickers, 54, of Livonia.

According to the indictment, while serving as the supervisor in command of the police department’s Integrity Unit, which was responsible for investigating reports of law violations and professional misconduct by police officers and other city employees, Kennedy conspired with Vickers to commit bribery by accepting money and other items of value in exchange for Kennedy using and promising to use his influence as a supervisor to persuade other officers to make tow referrals to a towing company in violation of the city’s ordinance and Detroit Police Department policy. The Integrity Unit is part of the department’s Internal Affairs Division. Under the city’s towing rotation, qualifying private towing companies are called by the police to tow cars that are seized by the police or reported stolen. Kennedy and Vickers were aware that by making towing referrals directly to a towing company which was not on the city’s towing rotation, they were violating the city’s rules and an ordinance which prohibit a towing company from receiving towing referrals if they are not on police department’s towing rotation. 

It was also part of the conspiracy that Kennedy and Vickers conspired to solicit and accept thousands of dollars in cash, cars, car parts, car repairs, and new carpeting for Vickers’ home, in exchange for providing the towing company that Kennedy was investigating with information about the status of the Integrity Unit’s case.

As part of the conspiracy, between October 2018, and March 2021, Kennedy accepted over $14,000 in cash, cars, and car repairs as a bribe from the owner of the towing company and from an undercover federal agent. Between February 2018 and June 2018, Vickers accepted $3,400 in bribe payments from the towing company.  Kennedy is charged in three separate bribery counts, in addition to the bribery conspiracy count.  Vickers is also charged with three bribery counts besides the conspiracy charge.       

The bribery charge carries a maximum sentence of 10 years’ imprisonment and a fine of $250,000.  The bribery conspiracy count carries a maximum sentence of 5 years’ imprisonment and a fine of $250,000. 

This is the second case charged as part of the government’s investigation known as “Operation Northern Hook.”  Northern Hook is an investigation of corruption within the government and the Police Department of the City of Detroit relating to the towing industry and other matters.  

Acting United States Attorney Mohsin said, “The vast majority of police officers are outstanding public servants and the criminal actions of these defendants should not undermine the public’s trust in law enforcement.  Police officers who compromise the integrity of the Police Department by prioritizing personal gain over policing excellence will not be tolerated, and this type of betrayal of the police department and the citizens of Detroit will be thwarted at every turn. Today’s indictment is a step in that direction. We thank the Detroit Police Department’s Chief, James White, for his assistance in this investigation.”

“Police officers take an oath to protect and serve their community. Kennedy and Vickers allegedly used their official positions to benefit themselves personally. Their actions are not in keeping with the integrity and professionalism exhibited by the Detroit Police Department every day,” said Special Agent in Charge Timothy Waters of the FBI’s Detroit Division. “The FBI appreciates the partnership and cooperation of Police Chief James White as we continue to address public corruption in the City of Detroit.”

Chief White stated, “I am profoundly disappointed with the crimes allegedly committed by members of the Detroit Police Department. We continue to work with our Federal partners to ensure corruption and misconduct are rooted out of every area of Government operations including the Police Department. We hold ourselves to a high standard and these actions fall far short of those standards. It is also important to emphasize that the actions of a few do not represent the vast majority of the fine women and men of the Detroit Police Department who faithfully serve the citizens of Detroit on a daily basis.

The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Dawn N. Ison and Eaton P. Brown.

An indictment is only a charging document 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.

DETROIT – Dominick’s Market owner and real estate developer, Hadir Altoon, 49, of Farmington Hills, pleaded guilty today to conspiring to commit bribery with Richard Sollars, Mayor of the City of Taylor, Jeffrey Baum, City of Taylor Community Development Manager, and Shady Awad, real estate developer, Acting United States Attorney Saima S. Mohsin announced.

Mohsin was joined in the announcement by Timothy Waters, Special Agent In Charge of the Detroit Field Office of the Federal Bureau of Investigation.

During his guilty plea hearing, Altoon admitted to paying bribes to Mayor Sollars by giving Sollars tens of thousands of dollars in cash, scratch-off lottery tickets, and other items of value, and facilitating the payment of bribes to Sollars by Shady Awad, in connection with the City of Taylor’s Right of First Refusal (“ROFR”) Program.  The ROFR Program is designed to allow Taylor to acquire tax-foreclosed properties from Wayne County for redevelopment. According to court records, between 2017 and 2019, Altoon paid and/or facilitated the payment of over $80,000 in cash to Sollars and over $4,000 in cash payments and other items of value to Baum in exchange for Sollars’s and Baum’s assistance in obtaining tax-foreclosed properties under the City’s ROFR program. Altoon also conspired with Sollars to steal money from Sollars’s campaign fund by preparing false and inflated invoices for catering services that were never rendered, were prepared in amounts higher than the actual amount for the catering services provided, and/or were for catering services for which Altoon had already been paid by the City of Taylor. 

In furtherance of the fraudulent scheme, Altoon issued the false invoices to Sollars’s campaign fund and completed blank campaign fund checks, bearing Baum’s signature as treasurer of the campaign fund, in the amounts of the false invoices.  Altoon cashed the campaign checks based on the false invoices at his store, Dominick’s Market, and gave Sollars cash and/or scratch-off lottery tickets in same amounts of the checks, totaling over $35,000.  Altoon also engaged in this same fraudulent conduct by accepting checks made payable to Dominick’s Market, purportedly for catering services to Sollars’s campaign, from donors to Sollars’s campaign.  Altoon cashed the donors’ checks, totaling over $12,000 and gave Sollars cash and/or scratch-off lottery tickets in the total amounts of the checks. Altoon also facilitated Sollars’s bribery activities with co-conspirator Shady Awad by accepting credit card information from Awad and charging over $19,000 to Awad’s credit cards, which Altoon converted to cash and gave to Sollars. Altoon also converted blank money orders, totaling $3,000, into cash for Sollars and gave Baum $5,000 in cash for a Sollars campaign golf event. It was also part of the conspiracy that Altoon gave Baum gift cards and over $4,000 in cash.  In exchange for the cash and other items of value Altoon provided to Sollars and Baum, another developer transferred two properties and Awad transferred nine properties, that were originally transferred to that other developer and Awad, respectively under the City’s ROFR program, to Altoon.  

The bribery conspiracy count to which Altoon pleaded guilty carries a maximum sentence of 5 years of imprisonment.  Under the United States Sentencing Guidelines, it is likely that Altoon  will face a guideline sentencing range of between 27 and 33 months of imprisonment, and a maximum fine of up to $250,000.

Acting United States Attorney Mohsin said, “We will continue to unearth public corruption wherever we find it in this district. Those who persist in helping public officials deny the citizens of this district the honest services they deserve will be held accountable.”

“The corrupt activities uncovered in this case were facilitated by men whose desire for favorable treatment outweighed notions of integrity and fair play,” said Special Agent in Charge Timothy Waters of the FBI’s Detroit Division. “Those who seek to influence public officials through bribery will be aggressively pursued and prosecuted.”

The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Dawn N. Ison.

DETROIT – An Adrian man, and former teacher at Lenawee Christian School, was sentenced today to 24 years in federal prison on charges of production of child pornography and possession of child pornography, announced Acting United States Attorney Saima Mohsin.

Mohsin was joined in the announcement by Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division.

Sentenced was Matthew D. Thomas, 46.

On May 26, Thomas pleaded guilty to possession of child pornography and production of child pornography.  According to court records, Thomas admitted that over the course of 3 years he preyed upon a minor victim to engage in sexually explicit conduct for the purpose of producing images of such conduct.  In addition, Thomas admitted to possessing computer hard drives and cell phones which contained several thousand images and video of prepubescent minors and minors engaged in sexually explicit conduct, including photos that he had taken of clothed minors and then altering them to make the minors appeared naked.

“The acts of this defendant are truly reprehensible,” stated Acting United States Attorney Mohsin.  “This lengthy sentence protects the public and ensures that this defendant will no longer be able to victimize children.  I commend the work of the FBI and Lenawee County Sheriff’s Office for their dedication to investigating this case.”

“Crimes against children are reprehensible, especially when the perpetrator is a caretaker, teacher, or another adult who is supposed to protect children from abuse,” said Special Agent in Charge Timothy Waters of the FBI’s Detroit Division. “The FBI considers the investigation and prosecution of predators like Mr. Thomas to be of the highest priority.  Today’s sentence serves as a warning to others like him the FBI will aggressively pursue anyone who victimizes and exploits children.”

This case was investigated by special agents with the FBI and the Lenawee County Sheriff’s Office. This case was prosecuted by Assistant United States Attorney Thomas Franzinger.

DETROIT – Real Estate Developer Shady Awad, 41, of Allen Park, pleaded guilty today to conspiring with Richard Sollars, Mayor of the City of Taylor and Jeffrey Baum, City of Taylor Community Development Manager and former Treasurer for the Committee to Elect Richard (“RICK”) Sollars by giving Sollars cash, household appliances, free renovations to his home and lake house, and other items of value in connection with the City of Taylor’s Right of First Refusal (“ROFR”) Program, which is a program designed to allow Taylor to acquire tax-foreclosed properties from Wayne County for redevelopment, Acting United States Attorney Saima S. Mohsin announced today.

According to court records, between 2016 and 2018, Shady Awad paid for improvements and renovations to Sollars’ home and lake house totaling over $50,000; provided his credit card information to another developer interested in acquiring tax-foreclosed properties under the City’s ROFR program and allowed that developer to charge over $19,000 to his credit cards, which the developer converted to cash and gave to Sollars; and, gave Sollars at least $4,000 in cash while Sollars gambled in Las Vegas, all in exchange for Sollars’ assistance in obtaining tax- foreclosed properties under the City’s ROFR program. Among other items of value, Shady Awad paid for the installation of hardwood flooring, garage doors, front doors as well as kitchen appliances, a Hall Tree bench and washer and dryer at Sollars’ home. In addition, Shady Awad also paid for the installation of hardwood flooring and deck and railings refinishing at Sollars’ lake house. Between 2015 and 2018, Awad was awarded the vast majority of Taylor’s tax-foreclosed properties in the City’s ROFR program.

The bribery conspiracy count to which Awad pleaded guilty carries a maximum sentence of 5 years of imprisonment. Under the United States Sentencing Guidelines, it is likely that Awad will face a guideline sentencing range of between 37 and 46 months of imprisonment, and a maximum fine of up to $250,000. A sentencing date has been set for March 1, 2022.

Mohsin was joined in the announcement by Timothy Waters, Special Agent In Charge of the Michigan Field Office of the Federal Bureau of Investigation.

“Not only do we seek to hold public officials accountable when they violate the law, we also hold those accountable who benefit from such illegal activity,” said Acting US Attorney Mohsin. “Today’s plea is a step towards ensuring that the citizens of Taylor receive the honest government services they are entitled to.”

“Mr. Awad’s investigation is proof of the FBI’s resolve to root out fraud and corruption in all forms,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Division. “It is our continuing core mission to work with our federal, state, and local law enforcement partners to protect the integrity of city governments and to take strong action against those who seek to personally benefit by corrupting the fair administration of government programs."

The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorney Dawn N. Ison.

An Ypsilanti man was sentenced today to life in prison after having been convicted by a federal jury on charges of distribution and conspiracy to distribute and to possess with the intent to distribute controlled substances, heroin and fentanyl, resulting in the overdose death of one victim and the serious bodily injury to a second victim, announced Acting United States Attorney Saima Mohsin.

Joining Mohsin in the announcement were Keith Martin, Special Agent in Charge of the DEA Detroit Field Division, and Chad Baugh, Deputy Director of Canton Police Department.

Sentenced was Adam Dean Brown, 41. Brown was convicted on all three counts after an eleven-day trial which took place in September 2019 before United States District Judge Sean Cox. Brown also pleaded guilty to two lesser charges prior to trial. The jury deliberated approximately six hours before returning their verdicts.

According to the evidence presented at trial, on October 17, 2017, law enforcement responded to a house call where they found an individual deceased in his basement. Officers found a syringe and packet of suspected heroin at the scene and determined the deceased died of an apparent drug overdose. A subsequent investigation revealed that the suspected heroin was actually fentanyl, and that the 22-year-old victim died from a fentanyl overdose. Through their investigation, officers learned that the victim purchased the fentanyl from defendant Brown, a previously convicted drug trafficker. Further evidence showed that Brown and co-defendant James Sharp conspired to distribute illegal drugs, including heroin and fentanyl, over a fourteen-month period in 2016 and 2017. Co-defendant Terence Robinson connected Brown to the October 17, 2017, overdose victim. Before officers could stop Brown, however, he sold fentanyl to a second local man, leading to his overdose and serious bodily injury. The second victim also overdosed on fentanyl sold by Brown, but the victim’s mother called 911 and first responders worked diligently to revive the victim.

"This case is an example of the grave threat fentanyl poses to both witting and unwitting users,” said Acting US Attorney Mohsin. “We are fully committed to prosecuting individuals who continue to fuel the opioid epidemic in this state and throughout this country.  We hope that today’s sentence is significant step in helping to bring closure to the victim’s family.” 

“Fentanyl and heroin are causing overdose deaths throughout the state of Michigan in increasing numbers”, stated Acting Special Agent in Charge Martin. “The DEA is committed to aggressively pursuing individuals and Drug Trafficking Organizations who distribute these poisons across the state in order to profit from the destruction of lives and communities.”

“The Canton Police Department is fortunate to be able to partner with the federal government and in this case, provide a voice for the victim and a sense of justice for the family members struggling with the loss of their loved ones,” said Chad Baugh, Deputy Director of Canton Police Department.  “We are hopeful this sentence sends a message to drug traffickers in southeast Michigan,” Baugh adds.

James Sharp pleaded guilty to the charge of conspiracy to distribute and possess with intent to distribute controlled substances on January 11, 2019 and was sentenced to 41 months in prison. Terence Robinson pleaded guilty to the charge of conspiracy to distribute and possess with intent to distribute controlled substances and was sentenced to 36 months in federal prison.

This investigation was led by agents of the Drug Enforcement Administration assigned to the Southeast Michigan Regional OCDETF Strike Force along with assistance from the Canton Township Police Department. The case was prosecuted by Assistant U.S. Attorneys J. Michael Buckley and Hank Moon.  

Two Eastern European men were sentenced for providing “bulletproof hosting” services, which were used by cybercriminals between 2009 to 2015 to distribute malware and attack financial institutions and victims throughout the United States.

On June 28 and Oct. 20, Chief Judge Denise Page Hood of the U.S. District Court for the Eastern District of Michigan sentenced Pavel Stassi, 30, of Estonia, to 24 months in prison; and Aleksandr Skorodumov, 33, of Lithuania, to 48 months in prison, for their roles in the scheme.

According to court documents, Stassi and Skorodumov were members of a bulletproof hosting organization founded and led by two co-defendants, Aleksandr Grichishkin and Andrei Skvortsov, both 34 and of Russia. The group rented IP addresses, servers, and domains to cybercriminal clients who employed this technical infrastructure to disseminate malware used to gain access to victims’ computers, form botnets, and steal banking credentials for use in frauds. Malware hosted by the organization included Zeus, SpyEye, Citadel, and the Blackhole Exploit Kit, which attacked U.S. companies and financial institutions between 2009 and 2015 and caused or attempted to cause millions of dollars in losses to U.S. victims. The defendants also helped their clients evade detection by law enforcement and continue their crimes uninterrupted by monitoring sites used to blocklist technical infrastructure used for crime, moving “flagged” content to new infrastructure, and registering all such infrastructure under false or stolen identities.

“Cybercrime presents a serious and persistent threat to the United States, and these prosecutions send a clear message that ‘bulletproof hosters’ who purposely aid other cybercriminals are responsible, and will be held accountable, for the harms their criminal clients cause within our borders,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division.

“Given their international nature, and the anonymity of the internet, cybercrime investigations often take years,” said Acting U.S. Attorney Saima Mohsin for the Eastern District of Michigan. “They can require the resources of multiple law enforcement agencies, the cooperation of multiple governments, skilled interpreters, and time-consuming extradition procedures. The persistence and hard work of our law enforcement partners has led to these successful prosecutions and sends a message to cybercriminals that they will be brought to justice.”

“Over the course of many years, the defendants facilitated the transnational criminal activity of a vast network of cybercriminals throughout the world by providing them a safe-haven to anonymize their criminal activity,” said Special Agent in Charge Timothy Waters of the FBI’s Detroit Field Office. “This resulted in millions of dollars of losses to U.S. victims. Cybercriminals may believe they are beyond the reach of the FBI and our international partners, but today’s proceeding proves that anyone who facilitates or profits from criminal cyber activity will be brought to justice.”

According to court filings and statements made in connection with the defendants’ guilty pleas, Skorodumov was one of the organization’s lead systems administrators and, at some points, its only systems administrator. In this role, he configured and managed the clients’ domains and IP addresses, provided technical assistance to help clients optimize their malware and botnets, and monitored and responded to abuse notices. Stassi undertook various administrative tasks for the organization, including conducting and tracking online marketing to the organization’s criminal clientele and using stolen and/or false personal information to register webhosting and financial accounts used by the organization.

Stassi, Skorodumov, Grichishkin and Skvortsov each pleaded guilty to one count of Racketeer Influenced and Corrupt Organizations (RICO) conspiracy. Grichishkin and Skvortsov are pending sentencing and face a maximum penalty of 20 years in prison. A federal district court judge will determine each sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

The FBI investigated the case with critical assistance from law enforcement partners in Germany, Estonia and the United Kingdom.

Senior Counsel Louisa K. Marion of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Patrick E. Corbett of the Eastern District of Michigan prosecuted the case. The Justice Department’s Office of International Affairs provided substantial assistance.

DETROIT - U.S. Medical Management, LLC (“USMM”) and VPA, P.C. (“VPA”), providers of home-based healthcare services, have agreed to pay the United States $8.5 million to resolve allegations that USMM and VPA submitted to the Medicare program claims for payment for laboratory and diagnostic testing services performed from January 1, 2010 through December 31, 2015, which were not reasonable and necessary for the diagnosis or treatment of an illness or injury. The United States contends that the payments USMM and VPA received in connection with these claims were overpayments.

“USMM and VPA received millions of dollars from the United States for Medicare claims that were not eligible for reimbursement,” said Acting U.S. Attorney Saima Mohsin for the Eastern District of Michigan. “With this lawsuit and the accompanying resolution, USMM and VPA are being held to account for their improper receipt of Medicare claim reimbursements.”

Under the alternate remedy provision of the False Claims Act, 31 U.S.C. §§ 3729-3733, this settlement resolves allegations that were raised in five lawsuits filed under the qui tam, or whistleblower, provisions of that law. The False Claims Act permits private parties to file suit on behalf of the United States and to share in any recovery. Although the United States has not intervened in any of the False Claims Act allegations, under the alternate remedy provision of that law, the first-to-file whistleblower in this case will receive $1.53 million of the settlement amount.

The matter was handled by Assistant United States Attorney John Spaccarotella from the U.S. Attorney’s Office for the Eastern District of Michigan. 

The five qui tam cases are docketed as United States ex rel. Irfan Mahmood v. U.S. Medical Management, LLC, et al., No. 2:10-cv-12022; United States ex rel. Lisa R. Hines v. VPA, P.C. d/b/a Visiting Physicians Association, et al., No. 14-cv-13385; United States ex rel. Muhammad S. Rais, M.D. v. U.S. Medical Management, Inc., et al., No. 2:12-cv-15518; United States ex rel. Pamela Henkels and Margaret Wisniewski v. U.S. Medical Management, LLC, et al., No. 2:14-cv-11944; and United States ex rel. Sian Ghosh v. U.S. Medical Management, LLC, et al., No. 18-10029. The claims resolved by the settlement are allegations only; there has been no determination of liability.

FLINT - A former pastor and his associate have been sentenced for their role in a multi-year Ponzi scheme that defrauded more than 140 individuals from multiple states out of nearly $9.3 million, announced Acting United States Attorney Saima Mohsin.

Joining Mohsin in the announcement was Brian Thomas, Acting Special Agent in Charge, Internal Revenue Service – Criminal Investigation Division.

Sentenced were Larry A. Holley, 64, of Grand Blanc and Patricia E. Gray, 60, of Flint.  Holley received a sentence of 100 months in federal prison followed by a two-year term of supervised release.   Gray received a sentence of 42 months in federal prison followed by a two-year term of supervised release.  A restitution hearing will be set by United States District Judge Laurie Michelson, at which time the court will determine the amount of restitution each defendant will be required to pay back to the victims.

"Holley and Gray deliberately misled investors to convince them to turn over their savings,” said Acting US Attorney Mohsin.  "Investors should not be lulled into trusting an investment advisor just because they know them or because they are a member of an organization to which they belong.”

“Today’s sentencing is another reminder that when an investor promises not only extraordinarily high returns, but also guaranteed returns, it’s too good to be true,” said Brian Thomas, Acting Special Agent in Charge, Internal Revenue Service Criminal Investigation, Detroit Field Office.  “IRS-CI is committed to investigating Ponzi schemes similar to that of Holley and Gray’s and will aggressively act to protect American taxpayers’ hard-earned money.”   

According to court records, Gray and Holley, who was a pastor at Abundant Life Ministries in Flint, operated Treasure Enterprise, LLC, which fraudulently purported to provide financial planning and asset management services to investors.  Holley and Gray solicited many of the victim investors at financial seminars held at churches throughout Michigan and other states. 

As alleged in the indictment, in order to lure the potential investors, many of whom took their money out of legitimate investments–such as individual retirement accounts (IRAs) and 401(k)s–Holley and Gray promised high, guaranteed returns, and the safe return of an investor’s entire principal at the end of the investment period.  The money, however, was not invested and did not earn the profits to pay the guaranteed interest payments.  Instead, Holley and Gray, and others directed by them, simply deposited the victim investor funds into Treasure’s bank accounts and then used the money for their personal benefit, for the benefit of Abundant Life Ministries, to make interest and principal payments to earlier investors, and to pay other Treasure employees.

Both Holley and Gray pleaded guilty to conspiracy to commit mail fraud and wire fraud on July 8, 2019 and May 28, 2019, respectively.  Sentencing was delayed due to the COVID-19 pandemic.

This case was investigated by special agents of the Internal Revenue Service and was prosecuted by Assistant United States Attorneys Ann Nee and Anthony Vance.

DETROIT - Two brothers from Oregon, Ohio have been sentenced on charges of distributing and conspiring to distribute fentanyl resulting in the overdose death of a victim, announced Acting United States Attorney Saima Mohsin.

Joining Mohsin in the announcement were Special Agent in Charge Keith Martin, Drug Enforcement Administration, Detroit Division, and Chief Charles F. McCormick IV, Monroe Police Department.

Both Harry Clifford Wise, 39, and James Allen Wise, 32, received a sentence of 96 months in federal prison.

According to court records, on April 1, 2017, the Monroe Police Department responded to a house in the 300 block of E. 4th St. on a report of a deceased 33-year-old male.  An investigation revealed that the male victim had died of an opioid overdose.  The Monroe Police Department conducted a thorough investigation which uncovered that two brothers from Oregon, Ohio had supplied the victim with the mixture of fentanyl and heroin that took his life.

Both brothers were indicted on December 4, 2018, on charges of delivery of fentanyl and heroin causing death and conspiracy to distribute fentanyl and heroin.  Harry Wise pleaded guilty on August 22, 2019 and James Wise pleaded guilty on September 5, 2019.    Their sentencings were delayed due to the COVID-19 pandemic.

Also charged in this case was Odell McGee, a drug source for the Wises.  McGee pleaded guilty to the fentanyl/heroin conspiracy and was sentenced to 120 months in federal prison on September 21, 2021.

"Overdose deaths from heroin and fentanyl are a national epidemic, including here in Michigan," Mohsin said.  "Law enforcement agencies are working closely together to investigate and prosecute traffickers who are contributing to this epidemic."

DEA Special Agent in Charge Martin said, “It is a priority of DEA to identify and investigate those who distribute drugs that result in overdose and death.  The charges announced today should make it clear to all drug dealers that they will face consequences, for the harm that they inflict on the user and on society.  The Monroe Police Department deserves significant credit for devoting the time and effort needed to successfully investigate and bring these individuals to prosecution.”

Monroe Police Chief Charles F. McCormick IV stated, “I would like to thank the DEA for their partnership in this investigation, and a special thank you to MPD’s D/Lt. Derek Lindsay for his relentless efforts to seek justice in this case”.               

This investigation was led by the Monroe Police Department in partnership with the Drug Enforcement Administration.  The case is being prosecuted by Assistant U.S. Attorney Andrew Lievense.

BAY CITY – A Texas woman was sentenced today to six months in federal prison for introducing a misbranded drug into interstate commerce, announced Acting United States Attorney Saima Mohsin.

Mohsin was joined in the announcement by Special Agent in Charge Lynda Burdelik, Food and Drug Administration (FDA). 

Sentenced was Judith Holloway 34, of Watauga, Texas.  Holloway pleaded guilty before United States Magistrate Judge Patricia Morris on June 2, 2021.

According to court documents, 2,4-Dinitrophenol (DNP) is a chemical substance that, when ingested, causes rapid loss of weight, but is also associated with a high rate of adverse effects including cataracts, hyperthermia, tachycardia, cardiac arrhythmia, and death. In 1938, the U.S. Food and Drug Administration (FDA) declared DNP to be extremely dangerous and not fit for human consumption. At that time, the FDA announced publicly that it would prosecute those who manufacture and distribute DNP for use as a drug.

According to the indictment, between October 2018 and May 2020, Holloway sold DNP to consumers throughout the United States and in a number of foreign countries and misbranded the substance as a yellow pigment powder.  Holloway purchased bulk DNP and utilized eBay and other websites to market and sell the drug over the internet. Holloway did not label the package as DNP, nor did she include any directions or warnings regarding the use of the drug when she mailed it to consumers. The defendant also utilized eBay and other means to post DNP for sale to consumers as a pigment powder.  The defendant listed DNP on eBay and falsely labeled the DNP as “Yellow Pigment Powder DNP.”  eBay removed her listings for violating the company’s policy prohibiting the sale of hazardous items, medicines and drugs that require a prescription or are labeled Rx/Rx only on the packing as required by the FDA.  The defendant was undeterred by the removal and relisted the DNP on eBay on three separate occasions utilizing a different email address and false label.

Acting United States Attorney Mohsin stated, “This sentence should send a clear message to those who would profit from the sale of dangerous unapproved drugs that we will utilize every tool at our disposal to vigorously prosecute you in order to protect the health and safety of the general public. We urge everyone to refrain from ingesting DNP for any reason.”

“Ignoring FDA requirements and selling dangerous unapproved drugs online can cause serious harm to those who use the drugs,” said Special Agent in Charge Lynda M. Burdelik, FDA Office of Criminal Investigations Chicago Field Office.  “We will continue to investigate and bring to justice those who jeopardize consumers’ health.”

This case was prosecuted by Assistant United States Attorney Regina R. McCullough. The case was investigated by special agents of the Food and Drug Administration.

Lorenzo A. Pacheco, 31 of Mt. Morris and a Spanish Cobras gang member, was sentenced on October 6, 2021 to 63 months in federal prison following his conviction for being a felon in possession of a firearm, Acting U.S. Attorney Saima S. Mohsin announced today. 

Mohsin was joined in the announcement by Acting Special Agent in Charge Keith Krolczyk of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Detroit Field Division.

U.S. District Court Judge Matthew F. Leitman imposed sentence on Pacheco, a convicted felon who was on federal supervised release for a similar offense at the time he committed the instant offense.  Leitman also sentenced Pacheco to 3 years of federal supervised release following his term of incarceration.

According to court documents, on September 13, 2020, a Genesee County Sheriff’s Deputy observed Pacheco driving a vehicle in Flint without any headlights. As the deputy caught up with Pacheco, he saw Pacheco cut off another car while weaving in and out of traffic.  The deputy initiated a traffic stop on Pacheco who pulled into the parking lot of a local restaurant. As Pacheco pulled into the parking lot, he tossed a short-barreled shotgun out of the driver’s side window. Pacheco then continued to drive through the parking lot and onto another street despite the deputy’s continuous activated siren.  Pacheco eventually came to a stop at which time he jumped out of the vehicle and fled on foot. The deputy chased Pacheco as he ran into the backyard of a local residence, between the garage and the house. The deputy issued loud commands to stop but Pacheco continued to flee.  He ran behind the garage and jumped over a small fence where he fell.  Pacheco got up and continued to run.  The deputy deployed a taser hitting Pacheco in the back.  The deputy placed Pacheco in handcuffs and took him into custody.  Trooper with the Michigan State Police recovered the shotgun, which had one shell in the chamber and one in the magazine tube.  The shotgun’s serial number was not discernible.

“This case is representative of ATF’s commitment to working hand-in-hand with the U.S. Attorney’s office and our State and local partners to stop dangerous felons from illegally possessing firearms and keeping violent criminals out of our communities,” stated Special Agent in Charge Krolczyk.

“Guns in the hands of violent convicted felons is a recipe for disaster.  Our office will continue to work with our federal, state, and local law enforcement partners to target violent criminals, especially gang members, who illegally possess dangerous weapons,” said Mohsin.   

This investigation was conducted by the ATF’s Flint Field Office, the Genesee County Sheriff’s Department, and the Michigan State Police.  The case was prosecuted by the United States Attorney’s Office for the Eastern District of Michigan – Flint Branch Office.             

DETROIT - Two defendants have been charged via criminal complaint for their roles in separate frauds related to Covid-19 Vaccination Record Cards, announced Acting United States Attorney Saima S. Mohsin.

Joining in the announcement were Gavin McClaren, Acting Special Agent in Charge, VA-OIG, Central Field Office, Special Agent in Charge Lamont Pugh III of the U.S. Department of Health & Human Services, Office of Inspector General (HHS-OIG) – Chicago Region and Vance R. Callender, Special Agent in Charge of Homeland Security Investigations (HSI) field offices in Michigan and Ohio.

The first complaint charges Bethann Kierczak, 37, of Southgate with theft of government property and theft or embezzlement related to a healthcare benefit program. Kierczak, a registered nurse, was arrested this morning and will be appearing in federal court this afternoon on the charges.

According to the complaint, Kierczak is responsible for stealing or embezzling authentic Covid-19 Vaccination Record Cards from the VA hospital—along with vaccine lot numbers necessary to make the cards appear legitimate—and then reselling those cards and information to individuals within the metro Detroit community. The complaint alleges that Kierczak’s theft of Covid-19 Vaccination Record Cards began at least as early as May of this year and continued until the present.  It is further alleged that Kierczak sold the cards for $150-$200 each and communicated with buyers primarily via Facebook Messenger. 

The second complaint charges Rapheal Jarrell Smiley, 32, of Detroit with fraud involving department or agency seals, identity document fraud, and trafficking in counterfeit goods. Smiley was arrested earlier today and will also be making his initial appearance in federal court as well.

According to the complaint, Smiley is responsible for conducting an ongoing scheme to import and sell or otherwise distribute fraudulent Covid-19 Vaccination Record Cards. It is alleged that Smiley ordered the cards from two shippers in China, both of which have been previously identified by law enforcement as importers of fraudulent Covid-19 Vaccination Record Cards. Further, the complaint alleges that Smiley advertised the cards for sale via his Facebook and Instagram accounts.

“These arrests reflect our deep commitment to protecting the health of our community and preventing this dangerous fraud from affecting our most vulnerable citizens,” said Acting US Attorney Mohsin. “Regardless of whether an individual choses to get vaccinated, we urge everyone to avoid turning to schemes like these to evade vaccination requirements. Importing these cards is a crime. Selling these cards is a crime. We will continue to investigate these crimes and prosecute them accordingly.”

“VA’s COVID-19 safety protocols, including ensuring accurate vaccination records, exist to keep both veterans and VA’s healthcare workers safe during this global pandemic,” said Gavin McClaren, Acting Special Agent in Charge, VA-OIG, Central Field Office. “These charges symbolize VA OIG’s commitment to protecting the integrity of VA’s healthcare delivery system, and diligently investigating any potential criminal activity that could threaten the safety of its patients and employees.”

“The theft of government property is a serious crime, particularly when it involves documents that are used in recording patient health information,” said Special Agent in Charge Lamont Pugh III of the U.S. Department of Health & Human Services, Office of Inspector General (HHS-OIG) - Chicago Region.  "Stealing and selling COVID-19 vaccination cards is an inexcusable act and will not be tolerated. HHS is committed to working with our law enforcement partners to protect the health and safety of the public during this pandemic.”

“At a time when Americans eagerly want to return to a normal way of life, these counterfeit vaccine cards undermine our confidence in COVID-19 vaccines,” said Vance R. Callender, Special Agent in Charge of Homeland Security Investigations (HSI) field offices in Michigan and Ohio.  “HSI dedicates significant resources to investigate a wide variety of pandemic-related fraud schemes.  This arrest and seizure demonstrates HSI’s ongoing commitment to support the integrity of our public healthcare system by preventing the illegal importation and sale of counterfeit vaccine cards.”

A complaint is only a charge and is not evidence of guilt.  Trial cannot be held on felony charges in a complaint.  When the investigations are completed, determinations will be made whether to seek felony indictments.

The cases are both being prosecuted by Assistant United States Attorney Ryan A. Particka. The Kierczak investigation is being conducted by the U.S. Department of Veterans Affairs-Office of Inspector General (VA-OIG), VA Police Detroit and the Medicare Fraud Strike Force (MFSF) partners, a partnership among the Criminal Division, U.S. Attorney’s Offices, the FBI and U.S. Health and Human Services-Office of Inspector General (HHS-OIG). The Smiley investigation is being conducted by agents from Homeland Security Investigations, the principal investigative arm of the Department of Homeland Security.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

DETROIT - Viktor Gjonaj, 44, a Troy based commercial real estate broker and investor was sentenced today to 53 months in prison after having pleaded guilty to devising and executing a scheme to obtain money by means of false material promises and representations from victim-investors, Acting U.S. Attorney Saima S. Mohsin announced.

Mohsin was joined in the announcement by Special Agent in Charge Timothy T. Waters, Federal Bureau of Investigation.

Imposing the sentence was Honorable Linda Parker, United States District Judge.

According to court records, Gjonaj admitted that in June 2016, he thought he had discovered a guaranteed way to win huge jackpots in the Michigan Lottery Dailey 3 and 4 games. To accomplish this, he had to substantially increase the times he played and amounts he spent. In 2017, Gjonaj began losing more money than he won and more money than he could afford to lose. Rather than ending his gambling, Gjonaj devised a scheme to trick individuals into giving him money by falsely promising them he would invest it in lucrative real estate deals. To make the deals look legitimate, Gjonaj created a fake title company and instructed the victim-investors to wire transfer money into the bank account of the fake company. Gjonaj described the fraudulent real estate deals in great detail and encouraged victim-investors to continue giving him money by disbursing payments to them which he falsely claimed were profits on their “investment.” By early 2019, Gjonaj was betting over $1 million a week on Michigan Lottery games using money fraudulently obtained from victims. In August 2019, Gjonaj’s scheme to defraud unraveled resulting in over $23 million in losses to victims.

Following his release from prison, Gjonaj will serve a three-year term of supervised release and   the Court also ordered Gjonaj to make restitution to his victims in the amount of $25,299,120.00 and to forfeit $ $19,025,000.

“White collar criminals may use sophisticated methods and apparently legitimate businesses, but their crimes amount to nothing more than stealing other people’s money. Gjonaj used his previous business successes and relationships with victim-investors to lure them into his scheme, to convince them his false promises were true, and to steal their money,” said Acting United States Attorney Saima S. Mohsin.

 "In just over two years, Viktor Gjonaj stole more than $23 million from his victims with promises of lucrative real estate deals," said Timothy Waters, Special Agent in Charge of the FBI in Michigan. "Gjonaj violated the trust his victims placed in him and left many financially devastated. Today's sentence provides the victims with a measure of justice and serves as a signal to others that white collar criminals will be aggressively pursued by the FBI."

The investigation was conducted by the FBI. The Securities and Exchange Commission’s cooperation in this investigation is appreciated.

DETROIT – Three Detroit men have been sentenced for their role in the carjacking of a Lyft driver, announced Acting United States Attorney Saima Mohsin.

Mohsin was joined in the announcement by Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division.

Sentenced were Marquel Bazemore, 20, Jesse Evans, 21 and Joseph Shade-Hubbard, 21.  United States District Judge Nancy Edmunds sentenced Bazemore to 96 months in federal prison, Evans to 114 months in federal prison and Shade-Hubbard to 120 months in federal prison.

According to court documents, on August 9, 2019, Bazemore, Evans, and Shade-Hubbard ordered a Lyft (ride-sharing service) through the Lyft mobile application. At approximately 4 a.m. on that day, the Lyft driver (victim) picked up the defendants in a Cadillac Escalade from the area of 8 Mile and 75 in the city of Detroit. The defendants entered the victim’s vehicle and were driven to the area of Mark Twain and Lyndon in Detroit. As the victim attempted to drop the defendants off, defendants Bazemore and Shade-Hubbard exited the Cadillac and began punching the victim.  Evans was the front seat passenger, and he (Evans) pulled out a firearm, pointed the firearm at the victim and demanded that he give him everything he had. Bazemore and Shade-Hubbard began going through the victim's pockets and took his wallet, credit cards, and money.

This case was investigated by special agents of the FBI and is being prosecuted by Assistant US Attorney Jeanine Brunson.

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“We are very disappointed in the Court’s decision today dismissing the indictment. We take our duty to protect children very seriously.  Congress sought to protect young girls from the cruelty of the practice of female genital mutilation when it enacted 18 U.S.C. § 116 in 1996.  Congress reaffirmed the importance of this law when it re-enacted the statue in 2020 after the Court’s dismissal of the charge in this case as unconstitutional.  Child victims are vulnerable and they deserve our best efforts to hold accountable those who harm them.  Our prosecutorial team is comprised of some of our best and most experienced prosecutors.  I stand behind them and commend them for their dedication, integrity, and commitment to protect innocent child victims of female genital mutilation.”

DETROIT - Detroit City Councilman Andre Spivey, 47, of Detroit, pleaded guilty today to conspiring with a member of his staff to commit bribery by accepting over $35,000 in bribe payments in connection with the City Council’s oversight of towing in Detroit, Acting United States Attorney Saima S. Mohsin announced today.

According to court records, while serving as an elected member of the Detroit City Council, Andre Spivey accepted $35,900 from an undercover federal law enforcement officer and a confidential source of information for the FBI.  On eight separate occasions between February 2018 and February 2020, Spivey, or a member of his staff identified as “Public Official A,” accepted bribe payments amounting to thousands of dollars from the undercover agent or the confidential source, all in connection with towing issues pending before the City Council.  For example, on October 26, 2018, Spivey met with the undercover agent and the confidential source at the Side Street Diner in the City of Grosse Pointe, Michigan.  During that meeting, Spivey accepted $1,000 in cash from the undercover agent and another $1,000 in cash from the confidential source.  The payments were made to Spivey seeking Spivey’s assistance with a proposed towing ordinance pending before the City Council.  As another example of the corrupt payments, on February 21, 2020, the confidential source gave $8,000 in cash to Public Official A, and the undercover agent gave Public Official A $4,000 in cash.  Public Official A took the money knowing that it was given for the benefit of Spivey and in exchange for Spivey’s assistance with towing issues pending before the City Council.

Spivey has served on the Detroit City Council since 2009. 

The bribery conspiracy count to which Spivey pleaded guilty carries a maximum sentence of 5 years of imprisonment.  Under the United States Sentencing Guidelines, it is likely that Spivey will face a guideline sentencing range of between 37 and 46 months of imprisonment, and a maximum fine of up to $250,000.  A sentencing date has been set for January 19, 2022.

It is expected that Spivey will resign from office on the City Council as a result of his guilty plea.  

This is the first case charged as part of the government’s investigation known as “Operation Northern Hook.”  Northern Hook is an investigation of corruption within the government and the Police Department of the City of Detroit relating to the towing industry and other matters.  

Mohsin was joined in the announcement by Timothy Waters, Special Agent In Charge of the Michigan Field Office of the Federal Bureau of Investigation.

Acting United States Attorney Mohsin said: “The people of Detroit deserve a city government free of corruption and pay-to-play politics.  The conviction of Councilman Spivey for accepting $35,000 in bribes demonstrates that the federal government remains vigilant and determined in rooting out corruption within the City of Detroit.”       

“Unfortunately, we continue to see corruption by Detroit public officials that erodes the public's trust in government and undermines the City's effort to move Detroit forward,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Field Office. “Today’s guilty plea is a result of the FBI’s commitment to bringing corrupt officials to justice and should serve as warning to others who think they are beyond the reach of the law.”

This case is part of the government’s wide-ranging corruption investigation known as Operation Northern Hook.  The investigation of this case was conducted by the Federal Bureau of Investigation.  The case is being prosecuted by Assistant U.S. Attorneys David A. Gardey and Frances Carlson.

DETROIT – Ten individuals have been indicted on charges involving the alleged straw purchasing of firearms, announced Acting United States Attorney Saima Mohsin.  The indictment is part of the Department of Justice’s Project Safe Neighborhoods Initiative aimed at reducing gun violence.

Mohsin was joined in the announcement by Acting Special Agent in Charge Keith Krolczyk, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).

Project Safe Neighborhoods (PSN) is the centerpiece of the Department of Justice’s violent crime reduction efforts.  PSN is a comprehensive approach to combating gun violence by bringing together local, state and federal law enforcement officials, prosecutors, and community leaders to implement a multi-faceted strategy to deter and punish gun violence from all sides.  PSN focuses enforcement efforts on the most violent offenders as well as those who seek to circumvent gun laws put in place to protect the public, otherwise known as “straw purchasers”.

A “straw purchase” is an illegal firearm purchase where the actual buyer of the gun, being unable to pass the required federal background check or desiring to not have his or her name associated with the transaction, uses another person who can pass the required background check to purchase the firearm for him/her.  Those who purchase firearms in this illegal manner are subject to 10 years in prison and a $250,000 fine.

Charged today were: 

Chauncey Williams, 21, Detroit, MI

Mike Chahoua, 23, Sterling Heights, MI

Antonio Jackson, 22, Detroit, MI

Bishop Allen, 24, Detroit, MI

Garcia Moses, 24, currently residing in Florida

Donte Turner, 26, Detroit, MI

Reginald Small, 23, Detroit, MI

Eshon Rose, 22, Detroit, MI

James Jackson, 23, Detroit, MI

Emmanuel Stevens, 21, Detroit, MI

As alleged in the indictment, beginning in November 2020 and continuing through March 2021, defendants Chauncey Williams, Michael Chahoua and Antonio Jackson used stolen credit card information to purchase firearms from online retailers and enlisted seven straw purchasers to retrieve the firearms in-person from a local federal firearms licensee in exchange for compensation.  The straw purchasers allegedly made false statements stating that they were the actual purchaser of the firearms.  Once in receipt of the illegally obtained firearms, Williams, Chahoua and Jackson either personally possessed and used the firearms or resold the firearms for profit. In total, at least 40 firearms were illegally obtained through this scheme.  At least three of the firearms were recovered from convicted felons.

Six of the ten defendants have been arrested and will be appearing in federal court this afternoon for their arraignment.

“When you buy a gun for someone who is legally prohibited from possessing a firearm, you could be buying yourself 10 years in federal prison,” said Acting US Attorney Mohsin.  “The surge of gun violence in our cities is being fueled by individuals who circumvent the law and supply firearms to felons and trigger-pullers.  These cases should send a message to those thinking about straw purchasing firearms – you will be subject to federal prosecution.”

“Straw purchasing is not a victimless crime. The act of knowingly enabling a prohibited person to purchase a firearm puts firearms in the hands of criminal organizations and violent criminals presenting a grave threat to the safety of our communities,” said Acting Special Agent in Charge Keith Krolczyk.

The United States Attorney’s Office and the ATF are focused on prosecuting those individuals who are putting guns in the hands of criminals only to be used in an untold number of violent crimes.  This indictment is the latest in a string of charges brought during the last year involving the straw purchase of firearms.  In the last year, the USAO has obtained 13 indictments, charging 25 different individuals for their involvement in straw purchases of more than 74 firearms.  Some of those firearms were involved in shootings or found in the hands of felons. Some of those cases include:

On August 18, 2021, two individuals were indicted for making straw purchases of at least 10 firearms during a one-month period.  Two of those firearms were later recovered by law enforcement at crime scenes in the City of Detroit.  

On March 3, 2021, three individuals were indicted for their involvement in selling five firearms to an undercover agent between December 2020 and January 2021.  Agents then conducted NIBIN (National Integrated Ballistic Information Network) testing on the firearms and two of the guns sold to the undercover agent were traced to prior shootings into homes in Detroit from the fall of 2020.

Also indicted on March 3, 2021 was Danny Jo Thompson, II.  Thompson acted as a straw purchaser for a person he knew to be a convicted felon.  Specifically, Thompson purchased two AR-15 lower receivers (classified as a firearm under federal law) and worked with the convicted felon to convert two semi-automatic AR-style rifles into fully functioning machine guns.  The machine gun possessed by the convicted felon was later found in the felon’s truck at the scene of a shootout with law enforcement.

These charges are just some of the tangible results of this joint effort.  The United States Attorney’s Office and our law enforcement partners will continue to work together to reduce gun violence in our communities.

An indictment is not evidence of guilt.  Defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

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DETROIT - The former Treasurer of the Detroit Fire Department Union (DFFA) has been charged in a federal criminal complaint with embezzling over $220,000 in union funds, announced Acting United States Attorney Saima Mohsin.

Joining Mohsin in the announcement were Timothy Waters, Special Agent in Charge of the Detroit Field Office of the Federal Bureau of Investigation and Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.

Verdine Day, age 62, is scheduled to appear in federal court this afternoon in connection with a federal criminal complaint charging her with bank fraud and wire fraud.  The affidavit supporting the complaint states that Day was hired by the Detroit Fire Department in 1986.  She worked as a firefighter, engineer, and held other positions in the union before she was elected by her peers to Treasurer of the DFFA in November 2015.  She was Treasurer from December 2015 until her retirement from the DFFA and the City of Detroit in September 2019.  

The affidavit further states that during the four years Day was Treasurer of the DFFA, she fraudulently obtained approximately $167,900.00 of union funds by (1) issuing checks in her name and then changing the name of the payee in the Union’s Quickbooks software (2) cashing checks which were voided by her in Quickbooks and (3) writing checks made payable to cash.

Day also used DFFA credit cards as her own personal credit cards while she was Treasurer and after she retired. In total, she charged approximately $52,143.65 in personal expenses using DFFA credit cards.  Her purchases on DFFA credit cards included flights, hotel rooms, cruises, car insurance premiums, satellite and cable TV service, national and state parks fees, and furniture. For example, Day used a DFFA union credit card to charge $9,553 for a cruise with Royal Caribbean cruise lines in 2017.  Day also used a union credit card to pay for another Royal Caribbean cruise costing $8,975 on the Liberty of the Seas in 2019.  She used the union’s credit card to pay her bar bill at a casino in Ohio in May 2019 and for a meal at a Bubba Gump Shrimp Co. restaurant in Cozumel, Mexico in 2019.

Acting U.S. Attorney Saima Mohsin commended the work of the FBI and the Department of Labor in conducting this criminal investigation of a corrupt union officer and said, “This prosecution demonstrates that we will not tolerate union officers who abuse their authority and line their own pockets at the expense of the union’s membership. We will continue to work with our law enforcement partners to root out corruption and fraud involving unions.”

“Union officials are expected to serve with integrity, particularly when they are sworn to represent men and women who put their lives on the line every day to protect our communities,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Division.  “When a union official violates their position of trust, the FBI will continue to aggressively investigate these matters to ensure individuals are held accountable for their actions.”

“An important mission of the Office of Inspector General is to investigate allegations of fraud involving labor unions. We will continue to work with our law enforcement partners to investigate these types of allegations,” said Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.

The case is being prosecuted by Assistant U.S. Attorney Sarah Resnick Cohen. The investigation of this case was conducted by the Federal Bureau of Investigation and the Department of Labor. 

A complaint is only a charge and is not evidence of guilt. Trial cannot be held on felony charges in a complaint.  Day is facing a maximum of 30 years in prison on the bank fraud charge and up to 20 years in prison on the wire fraud charge. 

BAY CITY – A West Branch resident was sentenced yesterday to 30 months in federal prison on charges of filing false tax returns and aiding and abetting the filing of false tax returns and ordered to pay $844,945 in restitution to the IRS, announced Acting United States Attorney Saima Mohsin.

Mohsin was joined in the announcement by Acting Special Agent in Charge Brian Thomas, Internal Revenue Service, Criminal Investigation, Detroit Field Office.

Sentenced was Christopher Fratine, 53.  Fratine pleaded guilty in July 2019 to five counts of making a false tax return and four counts of aiding and abetting the filing of false tax returns before United States District Judge Thomas Ludington.  Sentencing was delayed due to the COVID-19 pandemic.

According to court documents, Fratine owned and operated a home health care business named Unity Home Care Services (UHCS). He also operated a separate home health care business named Unity Home Health Care (UHHC), which was owned by his wife. UHCS and UHHC provided in-home skilled nursing care, physical therapy, speech therapy and occupational therapy services in the general vicinities of Houghton Lake, Traverse City and Bay City, Michigan.  From 2013 until 2016, Fratine willfully made and subscribed false and fraudulent Individual Income Tax Returns, for calendar years 2012 through 2015, and Form 1120, U.S. Corporation Income Tax Return for UHCS, for calendar year 2013. Fratine also reviewed the tax returns prepared by the CPA based on the information he provided to her and willfully aided and assisted in, procured, counseled and advised the preparation and presentation to the IRS of false and fraudulent tax Forms 1120, U.S. Corporation Income Tax Returns for UHHC, for calendar years 2012 through 2015. IRS records showed that between 2012 and 2015, UHCS earned approximately $3 million in gross receipts, all of which came from Medicare, and UHHC earned approximately $6.4 million in gross receipts, of which approximately $5 million came from Medicare and the rest from private insurers. Fratine deposited all of the revenue from private insurers and a portion of the Medicare revenue into business bank accounts. He provided bank statements from these bank accounts to a CPA, who prepared the Forms 1120 for UHCS and UHHC and individual income tax returns for the Fratine based on this information. Fratine deposited the rest of the Medicare revenue in accounts with other financial institutions, but failed to disclose this and failed to provide statements to his CPA, concealing the existence of this income and of these accounts from the CPA. Between 2012 and 2015, FRATINE diverted over $2,147,537 of business gross receipts into bank accounts hidden from his CPA. In addition, Fratine wrote several business checks in 2012 through 2015, with a total of approximately $114,000, payable to Medicare and Humana, from the business bank accounts known to the CPA, claiming they were overpayments by the insurance companies, and, as such, deductible from gross receipts as returns and allowances; he then deposited those checks into the concealed business accounts. The CPA received carbon copies of all of these business checks causing her to incorrectly report the checks payable to Medicare and Humana as returns’ and deduct the checks from the businesses’ gross receipts on the Forms 1120. Fratine transferred the funds from these undisclosed bank accounts into his personal bank accounts and used the funds for gambling and other personal purposes.

“Individuals like Mr. Fratine, who created elaborate schemes to purposefully mislead others and defraud the IRS should expect to be prosecuted,” said IRS – Criminal Investigation, Detroit Field Office, Acting Special Agent in Charge Brian Thomas.  “The sentencing of Mr. Fratine demonstrates he intentionally falsified tax returns to hide millions of dollars of taxable income from the IRS.  These types of crimes will always be investigated and prosecuted to the full extent of the law.” 

This case was investigated by agents of the Internal Revenue Service, Criminal Investigation and was prosecuted by Assistant United States Attorney Anca Pop.

A criminal information was docketed today charging four Michigan residents in connection with a wire fraud scheme involving over $4.1 million in Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loans (EIDL) guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

According to court documents, Antonio George, 45, of Novi, attempted to obtain approximately $4.1 million in PPP and EIDL loans through applications submitted on behalf of 16 different companies. The information alleges that along with George, Kevin Womble, 37, of Detroit, Andrae Sims, 43, of Farmington Hills, and Sarah Vidal, 31, of Novi, provided false and misleading documents about certain aspects of the companies’ respective business operations and payroll expenses. For example, the information alleges that George obtained payroll information that was used to support a seemingly legitimate PPP loan application submitted on behalf of an unrelated entity and then used the unrelated entity’s payroll information to support fraudulent PPP and EIDL loan applications. 

George, Womble, Sims and Vidal are each charged with one count of conspiracy to commit wire fraud. George, a tax preparer, is also charged with three counts of aiding and assisting in the preparation of false and fraudulent returns for conduct related to his tax preparation business. If convicted of all counts, George faces a maximum total penalty of 29 years in prison. Womble, Sims and Vidal each face a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

George, Womble and Sims are scheduled to make their initial appearances today in the Eastern District of Michigan. Vidal is set to make her initial appearance tomorrow.

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; Acting U.S. Attorney Saima Mohsin of the Eastern District of Michigan; Special Agent in Charge Timothy Waters of the FBI’s Detroit Field Office; Inspector General Hannibal Mike Ware of the SBA’s Office of the Inspector General (SBA-OIG); and Acting Special Agent in Charge Brian Thomas of the Internal Revenue Service – Criminal Investigation (IRS-CI) made the announcement.

The FBI, SBA-OIG and IRS-CI are investigating the case.

Trial Attorney Patrick J. Suter of the Criminal Division’s Fraud Section and Assistant U.S. Attorney John K. Neal of the Eastern District of Michigan are prosecuting the case.

The Fraud Section leads the department’s prosecution of fraud schemes that exploit the PPP. Since the PPP began, Fraud Section attorneys have prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section has also seized more than $65 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds. More information can be found at  https://www.justice.gov/criminal-fraud/ppp-fraud.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

An information is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

BAY CITY – A Whittemore, Michigan, resident was arrested today in two separate criminal complaints related to the placement of explosive packages outside cellphone stores in Cheboygan,  and Sault Ste Marie, Michigan, announced Eastern District of Michigan Acting United States Attorney Saima Mohsin and Western District of Michigan United States Attorney Andrew Birge.  Whittemore and Cheboygan are in the Eastern District and Sault Ste. Marie is in the Western District.

Mohsin and Birge were joined in the announcement by Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division.

Charged was John Douglas Allen, 75.

According to the affidavit, on September 15, 2021, at approximately 7:36 pm, a United States Postal Service (USPS) box with black tape on it and a wire coming out of it was placed outside of an AT&T Store, located at 2972 W 8th Street, Sault Ste. Marie, Michigan.  Later that evening at approximately 10:10 pm, another USPS box with black tape on it and a wire coming out of it was placed outside of the Verizon Store, located at 1006 S Main Street Plaza 27, Suite 3, Cheboygan, Michigan.  The two devices recovered were examined by the FBI laboratory Explosive Unit, which concluded that the two devices were improvised explosive devices (IEDs), also commonly referred to as homemade bombs or pipe bombs.  Based on video footage taken from the cell phone stores and other nearby businesses, as well as an exhaustive investigation by law enforcement, agents were able to determine that Allen was the person who allegedly left the packages outside of the stores.   

The affidavit further alleges that letters, placed inside polka dot envelops and sealed in zip lock bags, were left at cell towers located in the Upper Peninsula.  The letters contained threats aimed at telecommunication carriers.

In each district, Allen faces charges of Extortion, which is punishable by up to 20 years in prison, and Attempted Damage or Destruction of Buildings Used in Interstate Commerce, which is punishable by a minimum of five years and not more than 20 years in prison. Allen will be making an initial appearance this afternoon in Bay City on the complaint pending in the Eastern District of Michigan.  A date has not yet been set for his appearance in the Western District of Michigan to answer those charges.

The charges in a complaint are merely allegations. A defendant remains innocent unless and until proven guilty in a court of law.  The investigation is continuing.

This case is being investigated by special agents, intelligence analysts, troopers, deputies, and officers from the FBI, Michigan State Police, Cheboygan County Sheriff's Office, Cheboygan Police Department, Sault Ste. Marie Police Department, Sault Ste. Marie Tribal Police, the US Coast Guard Investigative Service, US Border Patrol and ATF.

Assistant U.S. Attorneys J. Michael Buckley, Jerome Gorgon, Christopher O’Connor and Theodore Greeley are prosecuting the case in their respective districts.

DETROIT - A grand jury indictment was unsealed today charging a pharmacist with unlawful distribution of prescription drug controlled substances, conspiracy, and unlawfully maintaining a drug-involved premises, Acting United States Attorney Saima Mohsin announced. 

Mohsin was joined in the announcement by Special Agent in Charge Keith Martin, Drug Enforcement Administration, Detroit Division.

Charged was Hasna Bashir Iwas, age 60, of New Baltimore, Michigan.  Iwas is the owner and operator of Beacon Pointe Pharmacy in Grosse Pointe Park, Michigan. 

The Superseding Indictment adds the defendant to earlier indictments that charged Dr. Otis Crawford and three other defendants with operating a prescription drug ring in Detroit, Grosse Pointe Park, River Rouge and elsewhere.  Dr. Crawford pled guilty to charges in the earlier indictment but died from natural causes before he could be sentenced. 

This indictment alleges that pharmacist Iwas filled hundreds of fraudulent prescriptions issued from Dr. Crawford’s clinic such as oxycodone, hydrocodone, Xanax and promethazine with codeine syrup.  Dr. Crawford’s prescriptions alone had an estimated street value of over $2 million.  In addition, it is alleged she filled over 600 forged prescriptions under the names of various doctors for a forgery ring operating in Detroit, charging cash to fill the fake prescriptions even when the “patient” had insurance.  Pharmacist Iwas insisted that she always required the patient to be present to fill their controlled substance prescription and denied filling multiple prescriptions for a “runner” presenting a group of forged prescriptions.  But one of the forged prescriptions charged in the superseding indictment was filled the day after the “patient” was murdered. 

“We will continue to hold accountable healthcare professionals who seek to enrich themselves by illegally distributing controlled substances,” stated Acting US Attorney Mohsin.  “Our commitment to combatting the opioid crisis is unwavering.”

“Dispensing controlled substances is a privilege that requires abiding by the law,” said Special Agent in Charge Martin.  “DEA is committed to ensuring that those who have pledged to follow our nation’s drug laws are living up to that responsibility.”

The defendant is scheduled for her initial appearance in federal court on these charges on October 1, 2021.   

The case was investigated by the Drug Enforcement Administration and is being prosecuted by Assistant United States Attorney Wayne F. Pratt.

An indictment is only a charge and is not evidence of guilt.  Each defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

Michael Rymar, a Rochester Hills based contractor, pleaded guilty today to embezzling over $1 million in government funds from the United States Postal Service announced Acting United States Attorney Saima S. Mohsin.

Mohsin was joined in the announcement by Kenneth Cleevely, Special Agent in Charge of the Contract Fraud Investigations Division, United States Postal Service, Office of Inspector General.

Michael Rymar, 59, of Rochester Hills, stands convicted of embezzling government funds from the United States Postal Service (USPS). From 2015 to 2018, USPS engineers awarded Rymar’s company, Horizons Materials & Management LLC, with over $5 million in contracts for repairs on USPS buildings in Michigan and New York. But the documentation Rymar provided contained false and fraudulent statements, oftentimes dramatically and falsely overstating the amount he paid subcontractors to complete the repairs. Rymar also falsely inflated the amount he paid his own employees and the cost of materials on USPS jobs. Over the course of the three-plus year fraudulent scheme, Rymar stole over $1.2 million from USPS out of the $5 million in contracts he was awarded.

Acting United States Attorney Mohsin stated, “Today’s guilty plea shows our office’s commitment to protecting the public’s funds and to prosecute individuals who steal from government agencies.”

“The Postal Service spends hundreds of millions of dollars on new construction, maintenance, and renovations of facilities each year.  Along with the Department of Justice, the USPS Office of Inspector General will aggressively investigate those who would engage in this type of fraud.” said Special Agent in Charge Kenneth Cleevely of the United States Postal Service, Office of Inspector General.

Upon conviction for a violation of Title 18, United States Code, Section 641, theft of government funds, Rymar faces a maximum sentence of ten years in prison and a fine of up to $250,000. The government is also seeking restitution of the stolen funds. The government has also sought forfeiture of a number of financial accounts held by Rymar, including two accounts that are valued over $1.2 million.

The investigation of this case was conducted by the of the United States Postal Service, Office of Inspector General.  The case is being prosecuted by Assistant U.S. Attorney Steven Cares.

A Michigan man was sentenced today to 32 months in federal prison for fraudulently seeking nearly $1 million in Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Michael Bischoff, 60, of Macomb County, pleaded guilty to bank fraud on Nov. 23, 2020, in the Eastern District of Michigan. According to court documents, Bischoff, who owned multiple pizza restaurants in Macomb County, admitted to defrauding several financial institutions by submitting at least nine falsified PPP loan applications that included false representations about payroll, business expenses, and the number of employees working at his restaurants. To help secure the PPP loans, Bischoff also submitted multiple fabricated tax documents and fraudulently used another person’s personal identifying information. In total, Bischoff fraudulently sought approximately $931,000 in COVID-19 relief funds and received approximately $593,590. In addition to his prison sentence, Bischoff was ordered to serve three years of supervised release, and to pay $593,590 in restitution and a $5,000 fine.    

Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; Acting U.S. Attorney Saima Shafiq Mohsin of the Eastern District of Michigan; Special Agent in Charge Kathy A. Enstrom of the Federal Deposit Insurance Corporation, Office of Inspector General (FDIC-OIG); Special Agent in Charge Sharon Johnson of the SBA’s Office of Inspector General (SBA-OIG) Central Region; and Special Agent in Charge Douglas Zloto of the U.S. Secret Service’s Detroit Field Office made the announcement.

The FDIC-OIG, the SBA-OIG, and the Secret Service investigated the case.

Trial Attorney Philip B. Trout of the Criminal Division’s Fraud Section; Trial Attorney Chad M. Davis of Criminal Division’s Money Laundering and Asset Recovery Section; and Assistant U.S. Attorney John K. Neal of the Eastern District of Michigan prosecuted the case.

The Fraud Section leads the department’s prosecution of fraud schemes that exploit the PPP. Since the PPP began, Fraud Section attorneys have prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section has also seized more than $65 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds. More information can be found at  https://www.justice.gov/criminal-fraud/ppp-fraud.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

DETROIT - Four defendants have been charged via criminal complaint for their roles in a large-scale Unemployment Insurance benefit fraud scheme, announced Acting United States Attorney Saima S. Mohsin.

Joining in the announcement were Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General, Special Agent-in-Charge Timothy Waters, Federal Bureau of Investigation, Andre Martin, Special Agent-in-Charge, U.S. Postal Service Office of Inspector General, and Rita Saenz, Director of the California Employment Development Department.

The complaint charges Daeshawn Tamar Posey, 25, of Detroit; Chaz Duane Shields, 33, of Detroit; Cortney Shaquan Shields, 30, a current federal prisoner incarcerated at FCI Allenwood; and Brittany Levett Witherspoon, 25, of Warren, with mail fraud, wire fraud, aggravated identity theft, and conspiracy to commit mail and wire fraud. Posey and Witherspoon were arrested today in the metro Detroit area; Chaz Shields was arrested yesterday in the Boston area; and Cortney Shields remains in the custody of the Bureau of Prisons (BOP).

According to the complaint, Posey, Chaz Shields, Cortney Shields, and Witherspoon are responsible for filing over 240 claims for fraudulent unemployment insurance benefits across at least 20 states and territories, causing more than $725,000 in losses to the state of Michigan and more than $1,500,000 in losses to the state of California. The complaint alleges that Posey, Chaz Shields, and Witherspoon all filed a number of claims in both their own names, and the names of numerous other individuals. All three are also alleged to have filed claims using other people’s Social Security Numbers, without those individuals’ authorization. Claims were also filed in Cortney Shields’ name, while Shields was already in BOP custody and thus ineligible to receive benefits.

The complaint further alleges that all four individuals, including Cortney Shields, received benefits deposited into a variety of bank accounts, some connected to pre-paid debit cards. Cortney Shields also received large cash deposits from the other charged individuals into his BOP commissary account. The complaint also alleges that Cortney Shields, while in prison, exchanged messages with other coconspirators, facilitating the passing of other individuals’ personally identifiable information (PII) to enable the submission of additional fraudulent UI claims.

The complaint also alleges that Posey and Chaz Shields acquired multiple luxury vehicles and purchased these vehicles with a combination of cash, and fraudulently obtained unemployment insurance benefits.

“Taxpayer money diverted into the pockets of criminals means less money going to Michiganders who need help getting through this difficult time,” said Acting US Attorney Mohsin.  “These arrests reflect our ongoing commitment to investigating these schemes and bringing the people who commit these crimes to justice.”

"An important mission of the Office of Inspector General is to investigate allegations relating to unemployment insurance fraud. We will continue to work with our law enforcement partners to investigate these types of allegations,” stated Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.

"The FBI and its law enforcement partners will continue to devote significant resources to prevent unemployment insurance fraud and to hold accountable those who have already stolen taxpayer dollars meant for out-of-work Americans," said Timothy Waters, Special Agent in Charge of the FBI's Detroit Field Office. 

Special Agent-in-Charge Andre Martin, Great Lakes Area Field Office, U.S. Postal Service Office of Inspector General said, “Today’s charges represent our commitment to work with our law enforcement partners to maintain the integrity and trust in the U.S. Postal Service and critical benefit programs.”

The California Employment Development Department appreciates our strong partnership with United States Attorney Saima S. Mohsin and her team of skilled prosecutors,” said EDD Director Rita Saenz. “This investigation shows the power of state and federal agencies joining forces to hold fraud suspects accountable and protect this vital safety net program for hard hit workers and their families.”

A complaint is only a charge and is not evidence of guilt.  Trial cannot be held on felony charges in a complaint.  When the investigation is completed, a determination will be made whether to seek a felony indictment.

This is case is being prosecuted by Assistant United States Attorneys Ryan A. Particka, Timothy J. Wyse, and Special Assistant United States Attorney Corinne M. Lambert.  The investigation is being conducted jointly by agents from the Department of Labor Office of the Inspector General, the Federal Bureau of Investigation, and the United States Postal Service Office of the Inspector General.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

A Detroit resident was sentenced today to 240 months in federal prison after having been convicted by a federal jury in January 2020 on charges of sex trafficking using force and coercion, distribution of controlled substances, and maintaining a drug premises, announced Acting United States Attorney Saima Mohsin.

Mohsin was joined in the announcement by Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division.

Sentenced was Richard Knider Jackson, 71, of Detroit.  Jackson was convicted following a 5-day jury trial before United States District Judge Stephen J. Murphy, III.  The jury deliberated approximately 2 hours before returning their verdicts.

Jackson was also convicted of distribution of heroin and crack cocaine and maintaining a drug premises.

Evidence presented at the trial established that a woman called 911 in 2016 pleading for help. When Detroit Police responded, the officers quickly determined that the location was used for human trafficking. In the home, officers observed a house in complete disrepair, with signs of intravenous drug use throughout the home. Defendant had installed a security gate within the home at the top of the stairs.

“This defendant treated his victims like a commodity,” stated Acting U.S. Attorney Mohsin.  “He targeted vulnerable women and exploited them for his own profit and fueled their drug addictions by providing them with heroin and crack cocaine.  We hope that today’s sentence offers these victims a sense of justice and closure and also raises awareness that sex traffickers are exploiting victims in our communities."

The case was investigated by special agents of the FBI and was prosecuted by Assistant United States Attorneys Sara D. Woodward and Barbara Lanning.

A Grosse Pointe Park resident pleaded guilty today to one count of wire fraud in connection with obtaining by fraud, embezzling, and stealing the funds of the Holy Cross organization, a large charitable organization based in Clinton, Michigan, that receives federal funds, announced Acting United States Attorney Saima S. Mohsin.

Joining in the announcement was Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division.

Pleading guilty before U.S. District Judge Bernard Friedman was John R. Lynch, 56.

According to court records, in March 2012 Lynch became the CFO of the Holy Cross organization, and in January 2015 he became its CEO. Holy Cross was established in 1948 when Boysville of Michigan was incorporated under the auspices of the Roman Catholic Archdiocese of Detroit. Boysville of Michigan later became Holy Cross Children’s Services, which is now known as Holy Cross Services. The Holy Cross organization provides welfare services to disadvantaged children and adolescents, behavioral health services to adolescents and adults, and a number of support services to the homeless. Holy Cross services are provided mostly to individuals in Southeast and Mid-Michigan. The Holy Cross organization also includes the Samaritan Center, a large community resource center that provides healthcare, employment services, and other forms of support to residents of Detroit’s east side.

During today’s plea hearing, Lynch admitted that when he was Holy Cross’s CEO, he used Holy Cross funds to pay for repairs to his own cars, install a new roof on his house, pay down his personal mortgage balance, and make payments on a personal American Express account. Lynch also used Holy Cross funds to pay his own consulting company and to pay another company hired to provide security services at the Samaritan Center, a company ostensibly controlled by a relative but actually controlled by him. Lynch attempted to justify some of these payments with bogus invoices.  In addition, Lynch used his corporate Holy Cross American Express card to pay for goods and services of a personal nature.

A sentencing date has been set for January 18, 2022 at 1:30 pm..

Holy Cross received federal funds under the National School Lunch Program and the School Breakfast Program. It also received federal funds under Title IV-E of the Social Security Act, which pays for foster care and provides adoption assistance and guardianship assistance.

The case is being prosecuted by Assistant United States Attorney Stephen Hiyama. The investigation was conducted by the Federal Bureau of Investigation.

Acting U.S. Attorney Saima S. Mohsin announced that progress has been made towards reforming the International Union, United Automobile, Aerospace, and Agricultural Workers of America (“UAW”).  The UAW represents over 400,000 active members and over 580,000 retired members in more than 600 local unions across the United States. 

Previously, numerous high-level officials of the UAW had been the subject of criminal prosecutions based on fraud, corruption, embezzlement, and labor law violations.  These prosecutions had resulted in the criminal convictions of two UAW Presidents, Gary Jones and Dennis Williams, two UAW Vice Presidents, Joseph Ashton and Norwood Jewell, as well as seven other senior UAW officials.

Following the completion of a significant portion of the criminal investigation, the United States brought an anti-corruption and anti-fraud civil action against the UAW in December 2020 seeking injunctive and equitable relief in order to stop the fraud and corruption and to reform the UAW.  After the United States filed its civil complaint against the UAW in United States of America v. UAW, Case No. 20-cv-13293-Lawson, and after extensive negotiations, the United States and the UAW entered into an agreement to resolve the case through a Consent Decree.  The Consent Decree governing the UAW was entered by the Honorable David M. Lawson, United States District Judge, on January 29, 2021. 

Under the terms of the Court’s Consent Decree, the Court appointed an independent Monitor who has the authority to exercise disciplinary powers within the UAW, to investigate possible fraud or corruption within the union, and to seek discipline against UAW officers and members before a UAW Trial Committee, or before an independent Adjudications Officer appointed by the Court.  Members can report misconduct by UAW officials to the Monitor at https://www.uawmonitor.com.  The Monitor’s oversight of the union will last for six years, with a possible early termination if the Monitor were to find that his work is complete, and the UAW no longer needs the Monitor’s services, or extension if the Monitor or the parties feel that a longer period is appropriate. 

The Consent Decree fully and finally resolved the criminal and civil investigation of the UAW as an entity.  The UAW agreed to resolve a tax investigation by making a payment of $1.5 million to the Internal Revenue Service in connection with administrative fees that the union received from the three joint training centers that were operated with the three car manufacturers.  The UAW has made that payment to the IRS.  In addition, the UAW has already paid back over $15 million to the training centers for improper chargebacks that the union received from two of the training centers.  This money will be used by the joint programs for the health and safety of auto workers.  The National Training Center, which was the mechanism whereby FCA US LLC executives corruptly funneled money and other things of value to UAW officials will be dissolved and replaced with an untainted entity.               

After undergoing a rigorous selection process, the U.S. Attorney’s Office selected Neil M. Barofsky to serve as the Monitor of the UAW and asked the Court to so appoint him.  On May 12, 2021, Judge Lawson entered an order appointing Mr. Barofsky as the UAW Monitor.  Mr. Barofsky is a partner at the law firm of Jenner & Block.  There, he leads the firm’s monitorship practice, and has served as a monitor in other matters, including his appointment to monitor Credit Suisse Securities LLC and Credit Suisse AG following billion dollar settlements.  In these matters, Mr. Barofsky was separately appointed by the Department of Justice and the New York State Department of Financial Services.  Prior to Mr. Barofsky’s employment with Jenner & Block, he worked as an Assistant United States Attorney in the United States Attorney’s Office in the Southern District of New York.  He was also appointed to be the initial Special Inspector General for the Troubled Asset Relief Program (or TARP), an investigative agency that he built from scratch.  The Monitor’s staff includes experts in auditing, compliance, internal investigations, labor law, and labor elections. 

Since Mr. Barofsky became the Monitor in May 2021, he has taken a number of actions in furtherance of the Consent Decree’s goal of reforming the UAW and blocking additional criminal conduct.

First, the Monitor has been diligently working towards holding the referendum provided for by the Consent Decree.  The Consent Decree requires that the referendum occur by November 12, 2021.  The Monitor has directed that the referendum take place by a secret-ballot vote of all of the membership, overseen by the Department of Labor. The referendum will determine whether to change the UAW’s election method from the current delegate system to a direct election model, where the entire UAW membership could vote for the UAW President and the other members of the UAW’s International Executive Board.  Through the referendum, members will decide whether the UAW’s constitution will be changed to provide for a direct election system in the union, sometimes referred to as “one member, one vote,” starting in the 2022 election cycle. 

The Monitor has been working closely with officials from the Department of Labor’s Office of Labor Management Standards (“OLMS”) to plan and organize the referendum.  OLMS is the department’s expert in conducting and overseeing labor union elections.  The Monitor has directed that the referendum will be conducted by mail-in voting so-as-to ensure that all active and retired UAW members will have an opportunity to participate fully in the referendum.  The Monitor has issued interim rules governing the conduct of the referendum.  The rules direct that no UAW dues money can be used to campaign for or against the referendum.  The rules can be found here: https://www.uawmonitor.com/electionsreferendum.

 Acting US Attorney Mohsin stated, “The UAW Monitor has made significant progress over the past three months in implementing reform in the UAW.  The November referendum provides a historic opportunity for the UAW’s rank and file membership to be heard on whether to change the union’s election system.  We insisted that the Consent Decree give the union’s membership the opportunity to decide for themselves whether to change to a direct election system because of the pervasive culture of corruption that has plagued the UAW’s leadership for so many years.  We encourage all UAW members to educate themselves on the issues in the referendum, make up their own minds, and let their voices to be heard by casting a vote in the referendum.”

As part of the referendum process, the UAW Monitor has gone live with a Website, www.uawmonitor.com, to provide information to the UAW’s membership and to the public about the Referendum and about the Monitor’s activities.  The Monitor is planning a joint webcast in the fall so that both sides on the issue presented by the referendum will be able to make their case to the UAW’s membership.   

A second aspect of the work of the UAW Monitor is to investigate misconduct by UAW officials and then, where appropriate, to bring internal UAW charges against any official found by the Monitor to have engaged in misconduct.  The UAW Monitor will present and try these charges before the UAW Adjudications Officer.  The Adjudications Officer is another official to be appointed under the terms of the Consent Decree.  The Adjudications Officer will have the power to act as the judge and factfinder of the disciplinary charges brought by the UAW Monitor.  The Adjudications Officer will have the power to punish UAW officials who engage in misconduct as found by the Monitor.  The punishments could include, for example, expulsion from the UAW or termination from UAW positions. 

The UAW Monitor has already begun investigating historical acts of misconduct that were discovered by the United States during the criminal investigation in instances where the United States has decided not to bring criminal charges.  As part of this process, prosecutors with the U.S. Attorney’s Office and federal law enforcement agents have been meeting with the Monitor’s staff to provide information about historical misconduct.  As part of this process, the United States has provided the Monitor, as an arm of the Court and pursuant to Court order, with various investigative materials to assist the Monitor in investigating historical misconduct.  The United States has also sought and received permission from the Court to provide the Monitor with certain grand jury materials relating to closed matters and with copies of sealed search warrant applications.  Finally, members of the Monitor’s staff have met with a number of individuals who have been cooperating with the government’s criminal investigation.  The Monitor is seeking to gather additional information for purposes of deciding whether any internal disciplinary charges are appropriate against any UAW officials or members.      

Besides planning and organizing the upcoming referendum and beginning to investigate possible internal misconduct, the Monitor is also in the process of reviewing audit, accounting, and financial controls at the UAW.  The Monitor is assessing the controls the UAW has implemented to meet its obligations under the Consent Decree, is identifying gaps and areas of improvement through rigorous testing protocols, and is overseeing the implementation of further reforms by the UAW and its consultants.  In addition, the Monitor has the right under the Consent Decree to disapprove certain employment and contractual decisions by the UAW, and to review relevant financial data, books, records, audit findings, and other similar records.      

The United States will soon propose to the Court a candidate to serve as the UAW Adjudications Officer.  The Court will then decide whether to appoint that individual as the Adjudications Officer.  If appointed, the Monitor will be able to bring internal UAW disciplinary matters before the Adjudications Officer if appropriate.    

The Consent Decree governing the UAW is being handled by Assistant U.S. Attorneys David A. Gardey and Steven Cares.

DETROIT - An indictment was unsealed today charging two patient recruiters and the owner and operators of a pharmacy with conspiracy to illegally distribute prescription drugs, and other opioid-related charges, Acting U.S. Attorney Saima Mohsin announced today.

Mohsin was joined in the announcement by Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division, and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Chicago Regional Office.

Charged in the indictment are:

Dangelo Terrell Stephens, 38, of Detroit;

Latasha Maria Neely, 38, of Detroit;

Hassan Samir Saad, 33, of Dearborn; and

Ali Hussein Keblawi, 26, of Dearborn.

The indictment alleges that from June 2020 through July 2021, Stephens and Neely worked as patient recruiters/marketers, who would bring “patients” or patient information to area doctors and clinics. Those doctors and clinics, which include the owner, operators, and physician at Tranquility Wellness Center, who have been indicted in a companion case, would write or cause the writing of controlled substance prescriptions in the “patient” names, without medical necessity and outside the scope of professional medical practice, in exchange for cash payments.

As part of the conspiracy, Stephens and Neely needed the cooperation of area pharmacies, including their owners and employees. Saad was a licensed pharmacy technician who worked at and owned Heritage Medical Pharmacy, LLC, in Redford, Michigan. Keblawi was an employee at Heritage. In exchange for cash, Saad and Keblawi filled the unlawful prescriptions obtained by Stephens and dispensed, or caused the dispensing, of controlled substances to Stephens, and not to the patients to which they were prescribed. And Saad and Keblawi knew that the prescriptions were illegitimate, and, by dispensing the controlled substances, they failed to exercise their corresponding professional responsibility to determine that the prescriptions were issued for a legitimate medical purpose. Stephens and Neely then sold the controlled substances on the street.

The primary prescription drug-controlled substances illegally prescribed, filled at pharmacies, and distributed included Schedule II controlled substances Oxycodone, Oxymorphone, and Oxycodone-Acetaminophen (Percocet). These drugs were in high demand on the illegal street market, particularly Oxycodone 30mg and Oxymorphone 40mg.

Stephens is also charged with three counts of distributing Oxycodone pills, and Stephens, Saad, and Keblawi are charged with one count of distributing and aiding and abetting the distribution of Oxycodone pills.

According to the indictment, Stephens and Neely unlawfully distributed a combined total of more than 28,000 dosage units of Schedule II opioid prescriptions during the conspiracy.  These controlled substances had a conservative street value more than $775,000.

Also, during the conspiracy, Saad and Keblawi unlawfully dispensed a combined total of more than 5,500 dosage units of Schedule II controlled substances, carrying a conservative estimated wholesale street value of more than $150,000.

While most of the unlawful controlled substance prescriptions were paid for in cash, both controlled and non-controlled “maintenance” medications were billed to health care benefit programs by pharmacies. Billings to the Medicare and Medicaid programs for medically unnecessary prescription drug medications and maintenance medications during this conspiracy exceeded $200,000 

“The road to addiction often begins with prescription drugs, “said Acting US Attorney Mohsin.  “It is for this reason we are focusing our efforts on removing individuals who contribute to the devastating opioid crisis in this country,”

“The FBI is focused on stemming the supply of illegal opioids into our communities, especially those illegally distributed by doctors and clinics,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Division. “While we continue to work with our partners to combat this crisis that devastates communities, we ask for the public’s help by reporting any information related to the illegal sale and distribution of opioids.”

“The investigation into the unlawful prescribing and distribution of medically unnecessary controlled and/or non-controlled substances remains a priority of the OIG,” said Lamont Pugh III, Special Agent in Charge, U.S. Department of Health & Human Services, Office of Inspector General – Chicago Region. “The opioid epidemic is only exacerbated by those who seek profit over the health and safety of their patients. The OIG will continue to work with our law enforcement partners to identify instances where providers engage in the illegal distribution of opioids and waste vital taxpayer dollars.”

This case is being prosecuted by Assistant United States Attorneys Andrew J. Lievense and Alison Furtaw. The Eastern District of Michigan is one of the twelve districts included in the Opioid Fraud Abuse and Detection Unit, a Department of Justice initiative that uses data to target and prosecute individuals that are contributing to the nation’s opioid crisis.

The case was investigated by special agents and task force officers of the Federal Bureau of Investigation and the Department of Health and Human Services-Office of the Inspector General.

An indictment is only a charge and is not evidence of guilt.  Each defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

An indictment was unsealed today charging former registered nurse Mary Cheatham, 41, of Ypsilanti, MI, with one count of tampering with a consumer product, specifically the Schedule II controlled substance hydromorphone, which is used for pain relief, announced Acting United States Attorney Saima Mohsin. 

Mohsin was joined in the announcement by Special Agent in Charge Lynda Burdelik, Food and Drug Administration (FDA). 

According to the indictment, while working as a licensed registered nurse at DMC Sinai-Grace Hospital, Cheatham tampered with vials and syringes containing hydromorphone which she knew were intended to be administered to patients for the purpose of pain relief in the critical care unit of the hospital. She removed the hydromorphone from the vials and syringes; replaced the hydromorphone with another liquid, and returned the adulterated containers knowing they could be administered to patients at the hospital.

Acting United States Attorney Mohsin stated, “In order to protect the health and safety of our citizens, we take crimes like this seriously and will not hesitate to prosecute health care workers whose theft of drugs put patients in harm’s way.”

Patients should know they are receiving proper treatment from those entrusted with their medical care,” said Special Agent in Charge Lynda M. Burdelik, FDA Office of Criminal Investigations Chicago Field Office. “We must hold medical personnel accountable when they take advantage of their unique position and tamper with medications their patients need, potentially exposing them to contaminated medical products.”

This case is being prosecuted by Assistant United States Attorneys Mitra Jafary-Hariri and Regina R. McCullough. The case was investigated by special agents of the Food and Drug Administration.

An indictment is only a charge and is not evidence of guilt.  The defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

DETROIT – A Lathrup Village resident was sentenced today to 78 months in prison after having pleaded guilty to charges of being a felon in possession of a firearm, wire fraud, and aggravated identity theft, announced Acting United States Attorney Saima Mohsin.

Mohsin was joined in the announcement by Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division.

William Henry Berry, 30, was sentenced this afternoon before United States District Court Judge Stephen J. Murphy in Detroit.  Berry was also ordered to pay restitution in the amount of $52,536.00.

According to court records, Berry came to the attention of the FBI during an investigation into a series of shootings between rival gangs in the Detroit area.  Phone records placed Berry’s cell phone at the scene of four of those shootings.  During a subsequent search of Berry’s home agents recovered a loaded American Tactical Omni Hybrid outfitted with a “red dot” sight.  Berry, who was on parole at the time, having previously been convicted of armed robbery, was prohibited from possessing a firearm.  In addition, agents discovered cash, bank cards in several other peoples’ names, and a notebook with names, addresses, and social security numbers of identity theft victims.  Further investigation revealed that Berry had used the stolen identities to obtain over $52,000 in fraudulent unemployment benefits. 

“Berry committed these serious felonies while on state parole demonstrating his contempt for the law,” said acting United States Attorney Saima Mohsin.  “As a parolee, Berry chose not to become a productive member of society, but instead returned to violent criminal activity, identity theft and fraud.  There is no parole in the federal system. Today’s sentence protects the public by ensuring Berry will remain incarcerated for a significant period of time.”

“This case is an example of how violent criminals have diversified their illegal activities in an attempt to thwart enforcement efforts," said Timothy Waters, Special Agent in Charge of the FBI in Detroit. “The FBI and our law enforcement partners will continue to investigate and shut down criminal enterprises in any form."

Mohsin commended the work of the FBI in investigating this case.  Assistant U.S. Attorney Andrew Picek prosecuted the case.

DETROIT – FCA US LLC (FCA), one of the big three American automobile manufacturers, was sentenced in federal court in Detroit today after pleading guilty in March 2021 to conspiracy to violate the Labor Management Relations Act, also known as the Taft-Hartley Act, announced Acting United States Attorney Saima S. Mohsin.

Mohsin was joined in the announcement by Special Agent-in-Charge Irene Lindow, Chicago Region, U.S. Department of Labor Office of Inspector General, Special Agent in Charge Timothy Waters, Federal Bureau of Investigation, Detroit Division, Acting Special Agent in Charge Brian Thomas, Internal Revenue Service-Criminal Investigations, Detroit Field Office and Thomas Murray, District Director, US Department of Labor, Office of Labor Management Standards.

FCA is the North American operating subsidiary of Stellantis. 

Upon sentencing by United States District Judge Paul D. Borman, FCA stands convicted of participating in a conspiracy to violate the Taft-Hartley Act by making more than $3.5 million in illegal payments to officers of the International Union, United Automobile, Aerospace, and Agricultural Implement Workers of America (UAW) between 2009 and 2016. 

The illegal payments to UAW officials took various forms, including extravagant meals, rounds of golf, lavish parties for the UAW International Executive Board, an Italian-made shotgun, clothing, designer shoes, and other personal items paid for with credit cards issued by the joint training center.  FCA executives also paid off the $262,000 home mortgage of former UAW Vice President General Holiefield.  Holiefield and his widow also received hundreds of thousands of dollars funneled through Holiefield’s purported charitable organization, as well as sham companies under Holiefield’s control that had lucrative contracts with the training center.  In many instances, FCA passed the illegal Taft-Hartley payments through the UAW-Chrysler Skill Development & Training Program d/b/a the UAW-Chrysler National Training Center (NTC).  Ostensibly, the NTC was supposed to provide training and health and safety protections for FCA workers. 

FCA’s sentence requires payment of a $30 million fine, which represents a figure triple the base fine amount provided for the offense by the United States Sentencing Guidelines.  In addition, FCA will serve a three-year term of probation and be subject to three years of oversight by an independent corporate compliance monitor. The United States has selected Frances McLeod as the independent compliance monitor.  McLeod is a founding partner of Forensic Risk Alliance and head of its U.S. offices.  She has recently served as the independent compliance monitor for IAV GmbH, a German company that was recently prosecuted in this district in connection with the Volkswagen emissions conspiracy. McLeod’s team includes experts in labor law and automotive regulatory compliance.

“The sentencing of FCA marks a significant milestone in this historic case,” said Acting United States Attorney Mohsin. “Congress enacted the Taft-Hartley Act to ensure that union members could have confidence in their union leaders.  FCA violated these principles through corruption. By lavishing millions of dollars in gifts and cash upon UAW leaders, the FCA sought to improve its relationship with UAW leaders, and FCA thereby harmed the hardworking men and women of the UAW.  A compliance monitor and a significant fine are important steps towards ending this type of systemic corruption and deterring future corporate malfeasance.”

“FCA conspired to make more than $3.5 million in illegal labor payments to officers of the UAW, who used the illicit funds for personal mortgage expenses and extravagant entertainment.  Instead of negotiating in good faith, FCA corrupted the collective bargaining process and the UAW members’ rights to fair representation.  We will continue to work with our law enforcement partners to root out systemic corruption and fraud involving unions," stated Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.

“FCA bribed UAW officials in an attempt to ensure the outcome of negotiations was favorable to the corporation," said Timothy Waters, Special Agent in Charge of the FBI in Michigan. "This sweeping investigation and today's sentencing send a clear message that the FBI, working with our federal partners, will continue to hold corporations accountable when they violate federal laws.”

“Today’s sentence should serve as a reminder that IRS-CI and our law enforcement partners will aggressively investigate any company that violates federal law in an attempt to gain an unfair advantage in the marketplace”, stated Brian Thomas, Acting Special Agent in Charge of the Internal Revenue Service – Criminal Investigation Detroit Field Office. “A $30 million fine and oversight by an independent corporate compliance monitor is an important step in ending the systemic corruption at FCA.”

“Today’s sentencing shows that the Labor Department and our fellow law-enforcement agencies will not stand by when employers seek to sway union officials through illegal payments – whatever their form,” said Thomas Murray, District Director, U.S. Department of Labor, Office of Labor-Management Standards.  “OLMS will continue to work with its law enforcement partners to hold accountable any employer that unlawfully exploits its position in the collective bargaining process for personal or corporate financial gain without regard to the best interests of union members.”

Thus far, as part of this investigation of illegal payments by FCA to UAW officials, as well as fraud and embezzlement by other UAW officers, 14 individuals have been convicted of convicted of federal crimes, including three former FCA executives.  They include former FCA Vice President for Employee Relations Alphons Iacobelli (66 months in prison), former FCA Financial Analyst Jerome Durden (15 months in prison), former Director of FCA’s Employee Relations Department Michael Brown (12 months in prison), former UAW Presidents Dennis Williams (21 months in prison) and Gary Jones (28 months in prison), former UAW Vice Presidents Norwood Jewell (15 months in prison) and Joseph Ashton (30 months in prison), former UAW Region 5 Director and UAW Board member Vance Pearson (12 months in prison), former UAW Midwest CAP President Edward “Nick” Robinson (12 months in prison), former senior UAW officials Virdell King (60 days in prison), Keith Mickens (12 months in prison), Nancy A. Johnson (12 months in prison), Michael Grimes (28 months in prison), and Monica Morgan, the widow of UAW Vice President General Holiefield (18 months in prison).  Holiefield died in 2015. 

Acting United States Attorney Mohsin again commended the outstanding work of the Internal Revenue Service – Criminal Investigations, the U.S. Department of Labor – Office of Labor-Management Standards and Office of Inspector General, and the Federal Bureau of Investigation in conducting a comprehensive criminal investigation into labor corruption activities involving a vital sector of the local and national economy.

This case is being prosecuted by Assistant U.S. Attorneys David A. Gardey and Erin S. Shaw.

Dearborn resident Ali Rameh Bazzi pleaded guilty today to wire fraud and money laundering arising out of a $500,000 investment fraud scheme, announced acting United States Attorney Saima S. Mohsin.

Joining in the announcement were Special Agent in Charge Timothy Waters of the Federal Bureau of Investigation and Acting Special Agent in Charge Brian Thomas of the Internal Revenue Service-Criminal Investigations. 

Ali Rameh Bazzi, 26, pleaded guilty to one count of wire fraud arising from his scheme to defraud investors out of approximately $500,000. Bazzi also pleaded guilty to one count of money laundering, the result of financial transactions he engaged in with the fraudulently obtained funds.  

Acting United States Attorney Mohsin stated “Bazzi told his victims that he was investing their money in foreign exchange and commodity markets. In fact, he used their money to line his own pockets, and lied to his victims over and over again in order to sustain his fraud. Today’s guilty plea reflects my office’s commitment to hold accountable all those who fleece the public for personal gain.”

“Because seniors are a particularly vulnerable victim group and are often specifically targeted for financial fraud crimes, the FBI and our law enforcement partners have prioritized our efforts to address elder fraud,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Field Office. “We encourage anyone who believes they are a victim of fraud or know a senior who may be, regardless of financial loss, to immediately report the incident to the FBI or another law enforcement agency.”

“Investment fraud schemes that entice investors with the false promise of significantly larger than average returns often result in the entire loss of investment. IRS CI is committed to investigating the ‘too good to be true’ investment scams,” stated Brian Thomas, Acting Special Agent in Charge of the Detroit Field Office, IRS Criminal Investigation.

According to the plea agreement, Bazzi owned and operated a purported investment company in Dearborn, Michigan known as Welther Oaks, LLC.  Using the business name Welther Oaks, Bazzi solicited funds from individuals in various parts of the United States, including Michigan, Illinois and California, purportedly for investments. Bazzi represented to prospective investors that their funds would be invested primarily in foreign currency exchange markets; he also represented that the funds may be invested in certain commodities, including gold. Bazzi told the investors that Bazzi’s trading model would ensure that they earned high rates of return on their investment. Bazzi provided investors with written trading agreements and other materials. Bazzi also falsely represented that he was a licensed professional. Investors primarily funded their investments via checks mailed to Welther Oaks, or via wire transfers to bank accounts owned and controlled by Bazzi.

According to the plea documents, approximately 30 individuals invested funds with Bazzi over the course of his scheme, which ran from approximately March 2018 through March 2020. These investments totaled approximately $500,000. Contrary to his representations to the investors, Bazzi diverted most of the investors’ funds to his own personal uses and expenses. According to the plea documents, Bazzi spent investor funds on a sports car, other luxury vehicles, and expensive jewelry. To conceal the scheme. Bazzi provided investors with periodic investment account statements that listed fictitious trading activity and account balances.

The plea agreement further states that Bazzi engaged in financial transactions with the fraudulently obtained funds, including wiring some $28,429.20 to a business in Nevada for the lease of an exotic sports car.

Sentencing is set for November 30, 2021 at 4pm. before United States District Judge David M. Lawson.

The case is being prosecuted by Assistant United States Attorney John K. Neal. The investigation is being conducted jointly by the FBI and IRS-Criminal Investigations. The Chicago Office of the Commodity Futures Trading Commission provided substantial assistance in the investigation of this case.  

Combatting elder abuse and financial fraud targeted at seniors is a key priority of the Department of Justice.  The mission of the Department’s Elder Justice Initiative is to support and coordinate the Department’s enforcement and programmatic efforts to combat elder abuse, neglect and financial fraud and scams that target our nation’s seniors.  To learn more visit https://www.justice.gov/elderjustice.  The public is encouraged to report victimization and suspected fraud schemes by calling the National Elder Fraud Hotline at 1-833-FRAUD 11 (1-833- 372-8311). 

DETROIT - An indictment and criminal complaints unsealed by the United States Attorney’s Office today charge 14 people with wrongfully obtaining pandemic unemployment assistance benefits in multiple states, announced Acting United States Attorney Saima Mohsin.

Mohsin was joined in the announcement by Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General, Timothy Waters, Special Agent in Charge of the Federal Bureau of Investigation, and Liza Estlund Olson, acting director of the Michigan Unemployment Insurance Agency, Michigan Department of Labor and Economic Opportunity.

Charged in the indictment are:

• Sharodney Harrison, 36, of Detroit;
• Seandrea Crawford, 27, of Detroit;
• Sharrell Harrison, 33, of Eastpointe;
• Sha-Ron Harrison, 31, of Harper Woods;
• Sharease Harrison, 35 of Detroit;
• Edward Taylor, 36, of Detroit;
• James Mayfied, 36, of Detroit;
• Frank Jennings, 43, of Dearborn Heights; and
• Sharonda Griffin, 31, of Center Line.

Criminal complaints in related cases charge:

• Brandi Randall, 35, of Detroit, with conspiracy to commit wire fraud;
• Eric Matthews, 27, of Detroit, with wire fraud;
• Lenora Calliway, 35, of Highland Park, with conspiracy to commit wire fraud;
• Steven Johnson, 32, of Detroit, with wire fraud; and
• Tyshia Coleman, 37, of Detroit, with conspiracy to commit wire fraud.
• Another criminal complaint charges Sharodney Harrison with being a felon in possession of firearms.

The indictment alleges that nine defendants conspired together to commit wire fraud by filing fraudulent unemployment insurance claims in the names of people who were not aware their names were being used, or who were not eligible for benefits, often in several states for the same person.

“These defendants are charged with exploiting the pandemic to steal unemployment benefits earmarked for the people of the State of Michigan for their own personal gain. These allegations are serious, and my office is committed to prosecuting any person who attempts to use the Covid-19 crisis to defraud the people of Michigan or the United States,” stated Acting United States Attorney Saima Mohsin.

"An important mission of the Office of Inspector General is to investigate allegations of unemployment insurance fraud. We will continue to work with our law enforcement partners to investigate these types of allegations," stated Special Agent-in-Charge Irene Lindow, Chicago Region, U.S. Department of Labor Office of Inspector General.

“Since the beginning of the pandemic, the FBI has investigated criminals from Michigan and across the country who found ways to steal from unemployment insurance programs,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Field Office. “Unfortunately, the conduct alleged in these indictments is not unique and resulted in the loss of millions of dollars meant for Americans throughout the country. The FBI and its law enforcement partners will continue to devote significant resources to prevent unemployment insurance fraud and to hold accountable those who have already stolen taxpayer dollars meant for out-of-work Americans.”

“Many Michiganders have had to rely on unemployment benefits during these difficult economic times due to the pandemic and taking those benefits illegally hurts the workers who need them the most,” said Liza Estlund Olson, acting director of the Michigan Unemployment Insurance Agency. “We will continue to work with the U.S. Attorney’s Office and all our partners to investigate and identify suspected fraud in Michigan and hold the people who commit these acts accountable.”

The charges in this case are the result of a joint investigation by the Federal Bureau of Investigation, the Department of Labor—Office of Inspector General, and the Michigan Unemployment Insurance Agency, and is being prosecuted by Assistant United States Attorneys Meghan Sweeney Bean and Mark Chasteen.

Since June 2020, a total of 37 defendants have been charged in the Eastern District of Michigan with federal crimes relating to fraudulently seeking pandemic unemployment insurance benefits. Six defendants have entered guilty pleas; the remaining 31 cases are still pending. Collectively, these defendants are alleged to have submitted over $20 million in fraudulent pandemic unemployment insurance claims to the workforce agencies in Michigan and other states.

An indictment is only a charge and is not evidence of guilt. Each defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt. Similarly, a complaint is only a charge and is not evidence of guilt. Trial cannot be held on felony charges in a complaint. When the investigation is completed a determination will be made whether to seek a felony indictment.

For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form

DETROIT, MI.— As part of a COVID-19 pandemic mitigation strategy, many cities and other local municipalities have allowed restaurants to create or expand outdoor dining spaces onto streets, sidewalks, and parking lots. To ensure that such new dining spaces are accessible and do not impair the ability of pedestrians who use wheelchairs to travel around the area, the U.S. Attorney’s Office for the Eastern District of Michigan announced today that it will be providing the attached Dear Colleague Letter to remind communities and restaurants of their obligations under the Americans with Disabilities Act (“ADA”), 42 U.S.C. §§12101 et seq.

The Dear Colleague Letter explains that under the ADA, restaurants must ensure that all dining areas (both indoor and outdoor) are accessible. It is also a reminder to municipalities, who often must approve the use or expansion of outdoor dining, that these areas must not obstruct the accessible path of travel on sidewalks. Additionally, outdoor dining spaces should not reduce the availability of accessible parking spaces in streets and parking lots.

“We know that due to the COVID-19 pandemic, the restaurant industry was hit extremely hard and we are glad that cities and townships across Michigan have supported their restaurants by allowing them to creatively utilize and expand their outdoor spaces,” said Saima S. Mohsin, Acting U.S. Attorney for the Eastern District of Michigan. “However, it is important for municipalities and restaurants to comply with the ADA and ensure any outdoor dining spaces are accessible to people with disabilities, and do not diminish the accessibility of surrounding areas, including sidewalks and availability of accessible parking spaces.”

The Dear Colleague Letter also includes a link to the Department of Justice’s website, ADA.gov, which provides information and technical assistance on the ADA’s requirements for public accommodations, such as restaurants, as well as state and local governments.

The Civil Rights Unit at the U.S. Attorney’s Office for the Eastern District of Michigan was established in 2010 and vigorously enforces a variety of federal statutes that prohibit discrimination, including the ADA. Members of the public with a complaint relating to ADA compliance may submit a complaint by email to usamie.civilrights@usdoj.gov, or by calling (313) 226-9151.

DETROIT - Two men have pleaded guilty to Attempted Murder of Federal Agents, announced Acting United States Attorney Saima Mohsin.

Mohsin was joined in the announcement by Keith Krolczyk, Acting Special Agent in Charge of the Detroit Field Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).

Kevin Keshawn Young, a/k/a “Gucci,” 24, of Detroit, and Aaron Marquis Shooks, a/k/a “Boogey,” 23, of Detroit, pleaded guilty to Attempted Murder of Federal Agents before United States District Court Judge Sean F. Cox on August 4, 2021, for their roles in shooting at two ATF agents on April 15, 2019, on Detroit’s east side. Both men are scheduled to be sentenced on December 8, 2021.

According to court records, Defendant Aaron Shooks and other members/associates of a gang known as the OES 187 Head Hunters (“OES”) were involved in two shootings. The first was a shootout in front of St. John’s Hospital, which was part of an ongoing, violent feud between OES and a gang known as Block Squad. Shortly after, Shooks, who was driving, went to pick up more people. After getting back on the road, one of the passengers—Defendant Kevin Young—got out of the car and fired eleven shots at ATF agents in an unmarked vehicle who were investigating the earlier shooting. Young claimed he thought he was shooting at rival gang members rather than law enforcement.

Kevin Young entered into a plea agreement that calls for a minimum sentence of ten years and a maximum of 15 years in prison. Aaron Marquis Shooks entered into a plea agreement that calls for a minimum sentence of ten years and a maximum of 13 years in prison.

“Every day our law enforcement officers put their lives on the line and risk personal injury to protect our citizens from senseless violence,” said Acting United States Attorney Saima Mohsin. “When officers or agents are assaulted while performing those duties, the perpetrators can expect that every resource of this office will be used to prosecute them to the fullest extent of the law, and to seek justice.”

“Our special agents and other law enforcement officers risk their personal safety everyday doing their job, protecting the public and enforcing the law, to make our community safe. We are proud of them and their unrelenting professionalism.” commented ATF Acting Special Agent in Charge Keith Krolczyk Detroit Field Division. “We continue to be thankful to United States Attorney’s office for their partnership in the fight against violent offenders.”

The case was investigated by agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Assistant United States Attorneys Alyse Wu, Eric Straus and Robert Moran are prosecuting the case.

WASHINGTON – A Bloomfield, Michigan, businessman, who operated a biodiesel fuel company, was sentenced to 30 months in prison today for filing a false income tax return.

Chandra Yarlagadda owned and operated Alpha Bioenergy LLC, formerly known as Naturol Bioenergy LLC, which purchased and sold biodiesel fuel. Under the Clean Air Act and related federal regulations, companies such as Alpha that exported biodiesel fuel were required to purchase and retire Renewable Identification Numbers (RINs) for any volume of renewable fuel they exported. The RINs are used by the Environmental Protection Agency to track compliance with its annual Clean Air Act standards.

According to court documents, Yarlagadda reported income and expenses associated with Alpha on Schedules C attached to his personal income tax returns. Yarlagadda admitted as part of his plea that on the Schedules C attached to his 2009, 2010, and 2011 tax returns, he substantially overstated expenses associated with the purchase of RINs. For these three years, Yarlagadda reported RIN expenses totaling more than $14.2 million, when, in fact, he was only entitled to claim approximately $80,000 in RIN expenses for those years. Yarlagadda admitted that if he had not claimed these false deductions, he would have owed an addition $2.3 million in federal income taxes.

In addition to the term of imprisonment, U.S. District Judge Gershwin A. Drain ordered Yarlagadda to serve one year of supervised release and pay restitution to the IRS in the amount of $3,285,303.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Saima S. Mohsin for the Eastern District of Michigan made the announcement.

IRS Criminal Investigation, the U.S. Environmental Protection Agency – Criminal Investigation Division, and U.S. Immigration and Customs Enforcement – Homeland Security Investigations, conducted the investigation.

Trial Attorneys Melissa S. Siskind and Sarah C. Ranney of the Tax Division prosecuted the case, and Assistant U.S. Attorney Stephen Hiyama of the Eastern District of Michigan provided substantial assistance in this matter.

Additional information about the Tax Division and its enforcement efforts can be found on the division’s website.

DETROIT - Former Detroit Police Department Officer, Michael Mosley, was sentenced today to 18 months in federal prison following his conviction for bribery announced Acting United States Attorney Saima Mohsin.

Joining Mohsin in the announcement was Timothy Waters, Special Agent in Charge of the Detroit Field Office of the Federal Bureau of Investigation.

Mosley, age 49, pleaded guilty in February 2020 before United States District Judge George Caram Steeh. Mosley’s sentencing was delayed due to the COVID-19 pandemic.

Officer Mosley was a nineteen-year veteran of the Detroit Police Department. As stated during Mosley’s guilty plea, in April 2019, Mosley was a member of the Police Department’s Major Violators Unit. On April 3, 2019, Detroit police officers, including Officer Mosley, searched a drug trafficker’s house pursuant to a search warrant. The search uncovered two kilograms of heroin, one kilogram of cocaine, and six firearms. The drug trafficker admitted to owning the three kilograms of drugs to Officer Mosley, and the trafficker signed a confession. After the April 3rd search, Officer Mosley remained in contact with the drug trafficker in an effort to secure the trafficker’s cooperation concerning other criminal activity.

Subsequently, the drug trafficker offered Officer Mosley a cash bribe of $15,000 in exchange for not pursuing criminal charges based on the three-kilogram drug seizure. Officer Mosley agreed to the deal. On May 2, 2019, Officer Mosley collected $10,000 in cash left for him by the drug dealer in the backyard of an abandoned house in Detroit. On May 23, 2019, Officer Mosley accepted another $5,000 in cash left for him by the drug trafficker at the same abandoned house. In exchange, Officer Mosley gave the drug trafficker the original copy of his confession.

Acting U.S. Attorney Saima Mohsin commended the outstanding work of the FBI in conducting this criminal investigation of a corrupt police officer. “The vast majority of Detroit Police Officers are dedicated and superb public servants. When Mosley accepted a bribe, he betrayed his oath as a police officer and the citizens of Detroit. He also betrayed his fellow officers who seek to protect and serve with integrity. This prosecution demonstrates that we will not tolerate public officials who abuse their authority and seek to use their power to line their own pockets,” said Mohsin.

“Michael Mosley violated his oath to serve and protect the people of Detroit. His misconduct was a betrayal of his fellow officers, and it is not representative of the outstanding work of the Detroit Police Department every day," said FBI Detroit Special Agent in Charge Timothy Waters. "The FBI will do everything in its power to bring corrupt police officers to justice to ensure communities can have faith in the integrity of law enforcement."

“We are deeply disappointed in the actions of former police officer Michael Mosley,” said Interim DPD Chief James White. “I appreciate the collaborative effort with our federal partners and those members who conducted this thorough investigation and subsequent prosecution. Clearly, the actions of this former officer are disheartening; however, it does not represent the values of our department and the vast majority of the men and women who serve honorably to keep our residents safe.”

The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys Sarah Resnick Cohen, David A. Gardey, and Adriana Dydell.

WASHINGTON – Ascension Michigan and related hospitals, Providence Park Hospital, St. John Hospital and Medical Center, St. John Macomb Oakland Hospital and Ascension Crittenton Hospital (collectively, Ascension Michigan), all located in Michigan, have agreed to pay $2.8 million to resolve claims that they violated the False Claims Act by submitting or causing the submission of false claims for payment to federal health care programs related to alleged medically unnecessary procedures performed by a gynecologic oncologist (the “Doctor”).
“When hospitals receive payment from federal health care programs for medically unnecessary surgical procedures, they cannot simply retain those payments; they have an obligation to return them,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “We will continue to ensure that taxpayer funds are used appropriately for the important programs that they support.”
The settlement announced today resolves allegations that, from Feb. 1, 2011, through June 30, 2017, Ascension Michigan knowingly submitted false claims for payment to federal health care programs and improperly retained payment for professional and facility fees related to medically unnecessary radical hysterectomies that the Doctor performed, chemotherapy services that the Doctor administered or ordered that were not medically necessary, and evaluation and management services by the Doctor that were not performed or not rendered as represented. The government alleged that Ascension Michigan had concerns about the quality of care provided by the Doctor due to patient complaints and his suspected higher than average rates of pulmonary embolisms and surgical infections. The government further alleged that, as a result of these concerns, Ascension Michigan engaged a third-party doctor to conduct a peer review of a sample of the Doctor’s patients, which found that, for the majority of the radical hysterectomies and chemotherapy performed by the Doctor, a less aggressive surgery or medical intervention would have been the standard of care.
“Health care providers cannot avoid their obligation to repay government funds owed to federal health care programs,” said Acting U.S. Attorney Saima Mohsin for the Eastern District of Michigan. “We will vigorously pursue those who knowingly fail to repay monies they have received based on services which were not medically necessary or not rendered as billed.”
On June 28, 2018, Ascension Michigan made a submission under the Provider Self-Disclosure Protocol of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) related to professional and facility fees it billed to federal health care programs for services provided by the Doctor. Though Ascension Michigan initially improperly retained the monies that it collected related to its billings, Ascension Michigan cooperated in the government’s investigation and took active steps to address concerns related to the Doctor by: (i) engaging a third-party doctor to conduct the peer review; (ii) placing the Doctor on a performance improvement plan; (iii) ending its contractual relationship with the Doctor; and (iv) submitting the self-disclosure.
“Our agency will continue to hold accountable medical providers who perform medically unnecessary procedures and then inappropriately bill federal health care programs,” said Special Agent in Charge Lamont Pugh III of HHS-OIG. “Working with our law enforcement partners, we will continue to investigate such misconduct to protect beneficiaries and the taxpayer-funded health care programs serving those beneficiaries.”
The civil settlement includes the resolution of claims brought by Pamela Satchwell, Dawn Kasdorf and Bethany Silva-Gomez under the qui tam or whistleblower provisions of the False Claims Act. Under these provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned United States ex rel. Satchwell v. Ascension Health, No. 17-CV-12315 (E.D. Mich.). Relators will receive a combined payment in the amount $532,000.
The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Eastern District of Michigan, with assistance from HHS-OIG and the U.S. Defense Health Agency, Office of Program Integrity.
The investigation and resolution of this matter illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
The matter was investigated by Trial Attorney Denise Barnes of the Civil Division’s Commercial Litigation Branch, Fraud Section, and Assistant U.S. Attorney Carolyn Bell-Harbin of the U.S. Attorney’s Office for the Eastern District of Michigan.

Ascension Michigan and related hospitals, Providence Park Hospital, St. John Hospital and Medical Center, St. John Macomb Oakland Hospital and Ascension Crittenton Hospital (collectively, Ascension Michigan), all located in Michigan, have agreed to pay $2.8 million to resolve claims that they violated the False Claims Act by submitting or causing the submission of false claims for payment to federal health care programs related to alleged medically unnecessary procedures performed by a gynecologic oncologist (“the Doctor”).

“When hospitals receive payment from federal health care programs for medically unnecessary surgical procedures, they cannot simply retain those payments; they have an obligation to return them,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “We will continue to ensure that taxpayer funds are used appropriately for the important programs that they support.”

The settlement announced today resolves allegations that, from Feb. 1, 2011, through June 30, 2017, Ascension Michigan knowingly submitted false claims for payment to federal health care programs and improperly retained payment for professional and facility fees related to medically unnecessary radical hysterectomies that the Doctor performed, chemotherapy services that the Doctor administered or ordered that were not medically necessary, and evaluation and management services by the Doctor that were not performed or not rendered as represented. The government alleged that Ascension Michigan had concerns about the quality of care provided by the Doctor due to patient complaints and his suspected higher than average rates of pulmonary embolisms and surgical infections. The government further alleged that, as a result of these concerns, Ascension Michigan engaged a third-party doctor to conduct a peer review of a sample of the Doctor’s patients, which found that, for the majority of the radical hysterectomies and chemotherapy performed by the Doctor, a less aggressive surgery or medical intervention would have been the standard of care.

“Health care providers cannot avoid their obligation to repay government funds owed to federal health care programs,” said Acting U.S. Attorney Saima Mohsin for the Eastern District of Michigan. “We will vigorously pursue those who knowingly fail to repay monies they have received based on services that were not medically necessary or not rendered as billed.”

On June 28, 2018, Ascension Michigan made a submission under the Provider Self-Disclosure Protocol of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), related to professional and facility fees it billed to federal health care programs for services provided by the Doctor. Though Ascension Michigan initially improperly retained the monies that it collected related to its billings, Ascension Michigan cooperated in the government’s investigation and took active steps to address concerns related to the Doctor by: (i) engaging a third-party doctor to conduct the peer review; (ii) placing the Doctor on a performance improvement plan; (iii) ending its contractual relationship with the Doctor; and (iv) submitting the self-disclosure.

“Our agency will continue to hold accountable medical providers who perform medically unnecessary procedures and then inappropriately bill federal health care programs,” said Special Agent in Charge Lamont Pugh III of HHS-OIG. “Working with our law enforcement partners, we will continue to investigate such misconduct to protect beneficiaries and the taxpayer-funded health care programs serving those beneficiaries.”

The civil settlement includes the resolution of claims brought by Pamela Satchwell, Dawn Kasdorf and Bethany Silva-Gomez under the qui tam or whistleblower provisions of the False Claims Act. Under these provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned United States ex rel. Satchwell v. Ascension Health, No. 17-CV-12315 (E.D. Mich.). Relators will receive a combined payment in the amount $532,000.

The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch (Fraud Section) and the U.S. Attorney’s Office for the Eastern District of Michigan, with assistance from HHS-OIG and the U.S. Defense Health Agency, Office of Program Integrity.

The investigation and resolution of this matter illustrate the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).

The matter was investigated by Trial Attorney Denise Barnes of the Civil Division’s Commercial Litigation Branch, Fraud Section, and Assistant U.S. Attorney Carolyn Bell-Harbin of the U.S. Attorney’s Office for the Eastern District of Michigan.

The claims resolved by the settlement are allegations only, and there has been no determination of liability.