District Not Recorded

Jewish Hospital & St. Mary’s Healthcare Inc., doing business as Pharmacy Plus and Pharmacy Plus Specialty (collectively, Jewish Hospital), of Louisville, Kentucky, have agreed to pay $10,101,132 to resolve False Claims Act allegations that they knowingly submitted false claims to the Medicare program, the Department of Justice has announced.

“Healthcare providers will be held accountable when then knowingly submit false claims for prescription drugs that do not meet requirements to establish medical necessity,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “We take appropriate steps to protect Medicare funds and the integrity of our federal healthcare programs.”

The settlement announced today resolves allegations that Jewish Hospital knowingly submitted claims to Medicare for prescription drugs that did not meet Medicare coverage requirements, including the need to obtain the treating physician’s signature on the order establishing medical necessity, to confirm that refills were reasonable and necessary, and to document that the medications were in fact delivered.  The settlement also resolves allegations that Jewish Hospital submitted claims to Medicare that resulted from improper remuneration provided to Medicare beneficiaries in the form of free blood glucose testing supplies and waiver of co-payments and deductibles for insulin, in violation of the Anti-Kickback Statute, 42 U.S.C. § 1320a-7b(b), which prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally-funded programs. 

“Paying for medically unnecessary drugs robs vital government health programs of precious resources and can violate the law,” said Derrick L. Jackson, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “We will continue working with our law enforcement partners to protect beneficiaries and taxpayers.”

The settlement resolves allegations originally brought in a lawsuit filed by Robert Stone, a pharmacist, under the whistleblower or qui tam provision of the False Claims Act, which allows private parties to bring suit on behalf of the government and to share in any recovery.  Mr. Stone will receive $1.85 million.

The settlement was the result of an investigation by the Department of Justice’s Civil Division, Commercial Litigation Branch, the U.S. Attorney’s Office for the Western District of Kentucky, and the Office of Inspector General at the U.S. Department of Health and Human Services. 

The lawsuit is captioned United States ex rel. Stone v. Jewish Hosp. & St. Mary’s Healthcare, Inc., et al., Civil Action No. 3:17-294 (W.D. Ky.).  The claims resolved by the settlement are allegations only, and there has been no determination of liability.

A former currency trader was convicted today in New York for his participation in an antitrust conspiracy to manipulate prices for emerging market currencies in the global foreign currency exchange (FX) market, the Justice Department announced today.

Following a three-week trial in the U.S. District Court for the Southern District of New York, a jury convicted Akshay Aiyer (former Executive Director at a major multinational bank) of conspiring to fix prices and rig bids in Central and Eastern European, Middle Eastern and African (CEEMEA) currencies, which were generally traded against the U.S. dollar and the euro, from at least October 2010 through at least January 2013.

“Today, a jury of citizens held the defendant accountable for fixing prices and rigging bids for emerging market currencies traded in the United States and elsewhere,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division.  “This conviction serves as a reminder of our commitment to hold individuals responsible for their involvement in complex financial schemes which violate the integrity of the global financial markets.”

“Today’s verdict holds the defendant accountable for manipulating the foreign currency market for his own benefit at the expense of free and open competition,” said Federal Deposit Insurance Corporation (FDIC) Inspector General Jay N. Lerner.  “We are dedicated to working with our law enforcement partners to investigate such complex crimes which undermine the integrity of financial markets, and to bring bank insiders to justice.”

According to evidence presented at trial, the defendant engaged in near-daily communications with his co-conspirators by phone, text and through an exclusive electronic chat room to coordinate their trades of the CEEMEA currencies in the FX spot market.  The jury heard evidence that the defendant and his co-conspirators manipulated exchange rates by agreeing to withhold bids or offers to avoid moving the exchange rate in a direction adverse to open positions held by co-conspirators and by coordinating their trading to manipulate the rates in an effort to increase their profits.  By agreeing not to buy or sell at certain times, the conspiring traders protected each other’s trading positions by withholding supply of or demand for currency and suppressing competition in the FX spot market for emerging market currencies.  They also heard evidence that the defendant and his co-conspirators took steps to conceal their actions by, among other steps, using code names, communicating on personal cell phones during work hours and meeting in person to discuss particular customers and trading strategies.

The Antitrust Division has charged five companies and six individuals in its investigation of collusion in the FX spot market. On May 20, 2015, four major banks – Citicorp, JPMorgan Chase & Co., Barclays PLC and The Royal Bank of Scotland plc – pleaded guilty and agreed to pay collectively more than $2.5 billion in criminal fines for their participation in an antitrust conspiracy in the euro-U.S. dollar FX spot market.  On Jan. 25, 2018, BNP Paribas USA Inc. pleaded guilty and agreed to pay a $90 million criminal fine for its participation in an antitrust conspiracy involving emerging market FX prices.  On Jan. 4, 2017 and Jan. 12, 2017, plea agreements were announced for two former traders in connection with an antitrust conspiracy involving emerging market FX prices.

The Antitrust Division’s investigation of collusion in the financial markets is ongoing.  The investigation in today’s case is being conducted by the FDIC Office of Inspector General and the FBI’s Washington Field Office, and the prosecution is being handled by the Antitrust Division’s New York Office.  The Criminal Division’s Fraud Section also provided substantial assistance in this matter.  Anyone with information on price fixing, bid rigging or other anticompetitive conduct in the financial markets should contact the Antitrust Division’s New York Office at 212-335-8000 or visit www.justice.gov/atr/contact/newcase.html.

A federal jury in Denver, Colorado, found Martin Fields guilty yesterday of conspiracy to defraud the United States, conspiracy to commit money laundering, making false claims against the United States, and money laundering, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.

According to the evidence presented at trial, Fields, along with Matthew Taylor, Calvin Glover, and others, filed false claims for tax credits under a federal program that encourages the production and use of renewable fuels. To accomplish the scheme, Fields and his coconspirators created a fake company, Shintan Inc., that purported to be in the business of creating renewable biodiesel fuel. From 2010 to 2013, Fields and his coconspirators filed documents with the Internal Revenue Service (IRS) claiming more than $7.2 million in tax credits for production of renewable fuel. In fact, however, Shintan produced no qualifying renewable fuel, and the documents filed with the IRS were false. To avoid detection, Fields and his coconspirators laundered the fraudulently obtained funds through bank accounts belonging to Shintan and other shell companies. As a result of the scheme, Fields personally received at least $1.8 million.

Fields’s co-conspirators, Taylor and Glover, previously pleaded guilty – Taylor to money laundering and money laundering conspiracy and Glover to conspiracy to defraud the IRS.  

Sentencing is scheduled for Feb. 7, 2020. Fields faces a maximum sentence of five years in prison for conspiracy to defraud the government and for each false claim count, and 10 years in prison for money laundering conspiracy and each money laundering count. He also faces a period of supervised release, restitution and monetary penalties. 

Principal Deputy Assistant Attorney General Zuckerman thanked special agents of IRS-Criminal Investigation and EPA Criminal Investigation Division, who conducted the investigation, and Tax Division Trial Attorneys Sarah A. Kiewlicz, and Stephen K. Moulton, who are prosecuting the case.

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

A citizen and resident of the Dominican Republic pleaded guilty today in Miami, Florida, to multiple criminal charges in connection with a sophisticated global cellphone fraud scheme that involved compromising cellphone customers’ accounts in the United States and “cloning” their phones to make fraudulent international calls.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Ariana Fajardo Orshan of the Southern District of Florida and Special Agent in Charge George L. Piro of the FBI’s Miami Field Office made the announcement. 

Edgar Estarlin Peralta Lopez, 42, pleaded guilty to one count of conspiracy to commit wire fraud, access device fraud, the use, production or possession of modified telecommunications instruments and the use or possession of hardware or software configured to obtain telecommunications services; one count of wire fraud and one count of aggravated identity theft.  Sentencing is scheduled for Jan. 24, 2020, before U.S. District Judge Beth Bloom of the Southern District of Florida. 

According to the plea agreement, Peralta and his co-conspirators participated in a scheme to steal access to existing cellphone accounts, and fraudulently open new cellphone accounts, using the personal information of individuals around the United States. 

In the plea agreement, Peralta admitted that he played at least two roles in the conspiracy.  First, he was a telecommunications trafficker.  Specifically, Peralta would contract with telecommunication companies to transmit international calls for them for payment and then route those calls through cellphones reprogrammed with stolen or compromised telecommunications identifying information located at “call sites” in the United States.  Peralta and other co-conspirators transmitted thousands of calls to Cuba, Jamaica, the Dominican Republic, and other countries with high calling rates.  The calls were later billed to United States customers’ compromised accounts.  Second, Peralta was a “line” supplier, providing his co-conspirators with stolen or compromised telecommunications identifying information that they then used to reprogram the cellphones they controlled at call sites.

In addition, in the plea agreement, Peralta admitted to trafficking in approximately 3,158 combinations of stolen or compromised telecommunications identifying information, which were found in around over 1,390 emails he exchanged with co-conspirators.  Verizon Wireless reported that fraudulent use of just three of these combinations resulted in a loss of over $33,000.  Peralta admitted to a loss amount of at least $315,800.    

Peralta is a citizen of the Dominican Republic.  He was arrested in the Dominican Republic at the request of the United States, extradited to Miami in August where he is currently in custody.

Peralta is the sixth and last defendant to plead guilty in the case.  Previously, defendants Edwin Fana, Farintong Calderon, Jose Santana, Ramon Batista and Braulio de la Cruz pleaded guilty to similar charges and have already been sentenced to prison terms ranging from 36 months to 75 months. 

The FBI Miami’s Cyber Task Force investigated the case, dubbed Operation Toll Free, which is part of the FBI’s ongoing effort to combat large-scale telecommunications fraud.  The Criminal Division’s Office of International Affairs handled the extradition in this matter, with assistance from the U.S. Marshals Service.  Senior Counsel Matthew A. Lamberti of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Jared M. Strauss of the Southern District of Florida are prosecuting the case.

A citizen of Sweden has been extradited from Thailand to the United States today to stand trial for alleged securities fraud, wire fraud and money laundering.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney David L. Anderson of the Northern District of California and Special Agent in Charge Kelly R. Jackson of the IRS Criminal Investigation (IRS-CI), Washington, D.C. Field Office made the announcement.  

On July 25, 2019, a federal grand jury indicted Roger Nils-Jonas Karlsson, 45, and his company, Eastern Metal Securities (EMS), charging the defendants with engaging in a scheme to defraud victims of more than $11 million.  Karlsson was arrested June 17, 2019, in Thailand.

According to a complaint filed March 4, 2019, in connection with the case, since September 2006, Karlsson, also known by several aliases, including Steve Heyden, Euclid Deodoris, Joshua Millard, Lars Georgsson, Paramon Larasoft and Kenth Westerberg, used websites to communicate false representations to victims in a scheme to defraud potential investors.  For example, one website, www.easternmetalsecurities.com, allegedly was registered to a fictitious person and advertised shares in a product called a “Pre Funded Reversed Pension Plan” (PFRPP).  The indictment alleges Karlsson used the website to invite potential investors to purchase shares of the plan for $98 per share in exchange for an eventual payout of 1.15 kilograms of gold per share, even though as of Jan. 2, 2019, 1.15 kilograms of gold was worth more than $45,000. 

Karlsson also allegedly advised investors that, in the unlikely event that the gold payout did not happen, he guaranteed to them 97 percent of the amount they invested.  According to the complaint, the government found no evidence of any accounts held by Karlsson that would allow him to pay off the investors.  Instead, the complaint alleges, the funds provided by victims were transferred to Karlsson’s personal bank accounts and now appear to be tied up in real estate in Thailand.

The complaint further describes how Karlsson allegedly used a second website, www.hci25.com, to make multiple false communications to potential investors.  Karlsson allegedly brought the investors in HCI25 together with the investors in the PFRPP and posted multiple communications to delay the moment investors would realize there would be no payout.  For example, on one occasion, Karlsson allegedly explained that a payout had not occurred because releasing so much money all at once could cause a negative effect on financial systems throughout the world.  Karlsson also falsely represented that EMS was working with the U.S. Securities and Exchange Commission to prepare the way for a payout.

The complaint alleges Karlsson directed his victims to make investments using virtual currencies, such as Bitcoin.  Karlsson allegedly defrauded no less than 3,575 victims of more than $11 million. 

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

Trial Attorney Catherine Alden Pelker of the Department of Justice Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney William Frentzen of the Northern District of California are prosecuting this case with the assistance of Bridget Kilkenny.  This prosecution is the result of an investigation by the IRS-CI Washington, D.C. Cyber Crimes Unit.  The Criminal Division’s Office of International Affairs, the FBI Legal Attaché Office in Thailand, the IRS Criminal Investigation Attaché Office in Hong Kong and the Royal Thai Police Crime Suppression Division provided significant assistance.

A former salesperson in the New York offices of a U.S. bank (Bank A) was charged in a superseding indictment filed yesterday and made public today for his alleged participation in a racketeering conspiracy in connection with the manipulation of the markets for precious metals futures contracts, which spanned over eight years and involved thousands of unlawful trading sequences, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Assistant Director in Charge William F. Sweeney Jr. of the FBI’s New York Field Office.

Jeffrey Ruffo, 56, of Morristown, New Jersey, was charged in a superseding indictment filed in the Northern District of Illinois with one count of conspiracy to conduct the affairs of an enterprise involved in interstate or foreign commerce through a pattern of racketeering activity (more commonly referred to as RICO conspiracy) and one count of conspiracy to commit wire fraud affecting a financial institution, bank fraud, commodities fraud, price manipulation and spoofing.

The superseding indictment follows the original indictment filed on Aug. 22, 2019, which charges Gregg Smith, 55, of Scarsdale, New York; Michael Nowak, 45, of Montclair, New Jersey; and Christopher Jordan, 47, of Mountainside, New Jersey, with one count of RICO conspiracy; one count of conspiracy to commit wire fraud affecting a financial institution, bank fraud, commodities fraud, price manipulation and spoofing; one count of bank fraud and one count of wire fraud affecting a financial institution.  Those original charges – as well as the original charges of one count of attempted price manipulation, one count of commodities fraud and one count of spoofing against Smith and Nowak – are incorporated into the superseding indictment. 

The case is pending before U.S. District Judge Edmond E. Chang of the Northern District of Illinois.  The next status hearing in the case is scheduled for Dec. 5, 2019, at 10:45 a.m., during which Ruffo is expected to be arraigned.

The superseding indictment alleges that between approximately March 2008 and August 2016, Ruffo along with the other defendants and co-conspirators were members of Bank A’s global precious metals desk in New York, London and Singapore, with varying degrees of seniority and supervisory responsibility over others on the desk.  Ruffo, who joined Bank A in May 2008, worked there until August 2017.  During that time, he was an executive director and a salesperson on Bank A’s precious metals desk in New York, specializing in hedge fund sales.  Ruffo’s clients included hedge funds that were global investment management firms that invested in precious metals. As it relates to the RICO conspiracy, the defendants and their co-conspirators were allegedly members of an enterprise—namely, the precious metals desk at Bank A—and conducted the affairs of the desk through a pattern of racketeering activity, specifically, wire fraud affecting a financial institution and bank fraud.

The superseding indictment alleges that the defendants engaged in widespread spoofing, market manipulation and fraud while working on the precious metals desk at Bank A through the placement of orders they intended to cancel before execution (Deceptive Orders) in an effort to create liquidity and drive prices toward orders they wanted to execute on the opposite side of the market.  In thousands of sequences, the defendants and their co-conspirators allegedly placed Deceptive Orders for gold, silver, platinum and palladium futures contracts traded on the New York Mercantile Exchange Inc. (NYMEX) and Commodity Exchange Inc. (COMEX), which are commodities exchanges operated by CME Group Inc.  By placing Deceptive Orders, the defendants and their co-conspirators allegedly intended to inject false and misleading information about the genuine supply and demand for precious metals futures contracts into the markets, and to deceive other participants in those markets into believing something untrue, namely that the visible order book accurately reflected market-based forces of supply and demand.  This false and misleading information was intended to, and at times did, trick other market participants into reacting to the apparent change and imbalance in supply and demand by buying and selling precious metals futures contracts at quantities, prices and times that they otherwise likely would not have traded, the superseding indictment alleges.

As also alleged in the superseding indictment, the defendants and their co-conspirators defrauded Bank A’s clients who had bought or sold “barrier options” by trading precious metals futures contracts in a manner that attempted to push the price towards a price level at which Bank A would make money on the option (barrier-running), or away from a price level at which Bank A would lose money on the option (barrier-defending).  Namely, when barrier-running, the defendants and their co-conspirators would allegedly place orders for precious metals futures contracts in a way that was intended to deliberately trigger the barrier option held by Bank A.  Conversely, when barrier-defending, the defendants and their co-conspirators would allegedly place orders for precious metals futures contracts in a way that was intended to deliberately avoid triggering the barrier option held by clients of Bank A.

The superseding indictment alleges that one of the reasons the defendants and their co‑conspirators used Deceptive Orders in their trading was to service and benefit key clients, including Ruffo’s hedge fund clients, which were important sources of revenue and market intelligence for the precious metals desk at Bank A.  For example, as alleged in the superseding indictment, if a hedge fund client wished to purchase gold, Ruffo would receive the order and communicate it to Smith, who, with Ruffo’s knowledge and encouragement, would then place Deceptive Orders to sell gold futures contracts in order to artificially lower the price at which the hedge fund could buy (or the defendants and their co-conspirators could buy on the hedge fund’s behalf).  By passing along the lower price, the superseding indictment alleges, the defendants and their co-conspirators hoped to retain that hedge fund’s business for the precious metals desk at Bank A.

The charges in the superseding indictment are merely allegations, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

This case is the result of an ongoing investigation by the FBI’s New York Field Office.  The Commodity Futures Trading Commission’s Division of Enforcement provided assistance in this case.  Trial Attorney Matthew F. Sullivan and Assistant Chief Avi Perry of the Criminal Division’s Fraud Section are prosecuting the case.

Individuals who believe that they may be a victim in this case should visit the Fraud Section’s Victim Witness website for more information at https://www.justice.gov/criminal-fraud/victim-witness-program.

Federal District Court Judge Alan B. Johnson sentenced LEWAUN CHRISTOPHER PORTER, 43, of Aurora, Colorado on November 12, 2019 for possession with intent to distribute methamphetamine, cocaine, and heroin, carrying a firearm during and in relation to a drug trafficking crime, and being a felon in possession of a firearm.  Porter was arrested in Cheyenne, Wyoming.  He received one hundred eight months of imprisonment, to be followed by sixty months of supervised release, and ordered to pay community restitution in the amount of $200.00 and a $300.00 special assessment.  The Wyoming Division of Criminal Investigation investigated this case.

Federal District Court Judge Alan B. Johnson sentenced DAVID ANTHONY MCKEOWN, 51, of Casper, Wyoming on November 12, 2019 for conspiracy to distribute methamphetamine.  McKeown was arrested in Casper, Wyoming.  He received eighty-four months of imprisonment, to be followed by sixty months of supervised release, and ordered to pay community restitution in the amount of $400.00 and a $100.00 special assessment.  The Wyoming Division of Criminal Investigation investigated this case.

Federal District Court Judge Nancy D. Freudenthal sentenced NICHOLAS ROSS HALCOTT, 20, of Cheyenne, Wyoming on November 14, 2019 for stealing of firearms from federal firearms license.  Halcott was arrested in Cheyenne, Wyoming.  He received thirty-seven months of imprisonment, to be followed by thirty-six months of supervised release, and ordered to pay restitution in the amount of $3,500.00 and a $100.00 special assessment.  The Cheyenne Police Department and the ATF investigated this case.

 

The United States has filed a complaint against Sioux Falls, South Dakota, neurosurgeon Wilson Asfora M.D., Medical Designs LLC, and Sicage LLC alleging False Claims Act violations arising from the alleged payment of kickbacks to Asfora tied to the devices he used in spinal surgeries, the Justice Department announced today.  Medical Designs and Sicage are medical device distributorships in South Dakota owned and operated by Asfora.         

The Anti‑Kickback Statute prohibits offering or paying anything of value to induce the referral of items or services covered by Medicare, Medicaid, and other federal healthcare programs.  The government’s complaint alleges that Asfora, Medical Designs, and Sicage engaged in multiple kickback schemes designed to pay Asfora hundreds of thousands of dollars in exchange for Asfora using spinal devices distributed by Medical Designs and Sicage in his spine surgeries.  Despite receiving numerous warnings that he was performing medically unnecessary procedures with the devices in which he had a financial interest, Asfora allegedly continued to perform such procedures while personally profiting from his use of devices sold by Medical Designs and Sicage.  The United States previously resolved related civil claims against several Sanford Health entities in October 2019.

“The Department of Justice will seek to hold accountable physicians and medical device companies that receive or pay illegal kickbacks in any form,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “Improper inducements have no place in our federal healthcare system where medical decisions should be based on the healthcare needs of patients and not on a physician’s personal financial interest.”

“Our office will aggressively pursue anyone who colludes to violate federal law and compromise the integrity of our healthcare system,” said U.S. Attorney Ron Parsons for the District of South Dakota.

“Government health program patients should be confident that surgical procedures are medically needed, not performed to increase physician profits,” said Curt L. Muller, Special Agent in Charge of the Office of Inspector General at the U.S. Department of Health and Human Services.  “For years our fraud alert has warned that physician distributorships are inherently suspect under the Anti-Kickback statute.”

The United States filed its complaint in a lawsuit pending in the U.S. District Court for the District of South Dakota that was filed under the qui tam, or whistleblower, provisions of the False Claims Act.  Under the act, a private citizen can sue on behalf of the government and receive a share of any recovery.  The act permits the United States to intervene and take over responsibility for litigating the case, as it has done here.  Those who violate the act are subject to treble damages and penalties.

The government’s pursuit of these matters illustrates the government’s emphasis on combating healthcare 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).    

This matter is being handled by the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office for the District of South Dakota, with assistance from the Department of Health and Human Service’s Office of Inspector General. 

The case is captioned United States ex rel. Bechtold, et al. v. Asfora, et al., No. 4:16-cv-04115-LLP (D.S.D.).  The claims asserted against the defendants are allegations only, and there has been no determination of liability.

          Today, United States Attorney General William P. Barr announced the launch of Project Guardian, a new initiative designed to reduce gun violence and enforce federal firearms laws across the country. Specifically, Project Guardian focuses on investigating, prosecuting, and preventing gun crimes.

          Reducing gun violence and enforcing federal firearms laws have always been among the Department’s highest priorities. In order to develop a new and robust effort to promote and ensure public safety, the Department reviewed and adapted some of the successes of past strategies to curb gun violence. Project Guardian draws on the Department’s earlier achievements, such as the “Triggerlock” program, and it serves as a complementary effort to the success of Project Safe Neighborhoods (PSN). In addition, the initiative emphasizes the importance of using all modern technologies available to law enforcement to promote gun crime intelligence.

          “Gun crime remains a pervasive problem in too many communities across America. Today, the Department of Justice is redoubling its commitment to tackling this issue through the launch of Project Guardian,” said Attorney General William P. Barr. “Building on the success of past programs like Triggerlock, Project Guardian will strengthen our efforts to reduce gun violence by allowing the federal government and our state and local partners to better target offenders who use guns in crimes and those who try to buy guns illegally.”

          “ATF has a long history of strong partnerships in the law enforcement community,” said Acting Director Regina Lombardo. “Make no mistake, the women and men of ATF remain steadfast to our core mission of getting crime guns off of our streets. ATF and U.S. Attorneys nationwide will leverage these partnerships even further through enhanced community outreach initiatives and coordination with local, state, and tribal law enforcement and prosecutors to cut the pipeline of crime guns from those violent individuals who seek to terrorize our communities. Project Guardian will enhance ATF’s Crime Gun Intelligence, to include identifying, investigating and prosecuting those involved in the straw purchases of firearms, lying on federal firearms transaction forms, and those subject to the mental health prohibition of possessing firearms.” 

          Project Guardian’s implementation is based on five principles:

1. Coordinated Prosecution. Federal prosecutors and law enforcement will coordinate with state, local, and tribal law enforcement and prosecutors to consider potential federal prosecution for new cases involving a defendant who: a) was arrested in possession of a firearm; b) is believed to have used a firearm in committing a crime of violence or drug trafficking crime prosecutable in federal court; or c) is suspected of actively committing violent crime(s) in the community on behalf of a criminal organization.
    
2. Enforcing the Background Check System. United States Attorneys, in consultation with the Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) in their district, will create new, or review existing, guidelines for intake and prosecution of federal cases involving false statements (including lie-and-try, lie-and-buy, and straw purchasers) made during the acquisition or attempted acquisition of firearms from Federal Firearms Licensees.
    
   Particular emphasis is placed on individuals convicted of violent felonies or misdemeanor crimes of domestic violence, individuals subject to protective orders, and individuals who are fugitives where the underlying offense is a felony or misdemeanor crime of domestic violence; individuals suspected of involvement in criminal organizations or of providing firearms to criminal organizations; and individuals involved in repeat denials.
    
3. Improved Information Sharing. On a regular basis, and as often as practicable given current technical limitations, ATF will provide to state law enforcement fusion centers a report listing individuals for whom the National Instant Criminal Background Check System (NICS) has issued denials, including the basis for the denial, so that state and local law enforcement can take appropriate steps under their laws.
    
4. Coordinated Response to Mental Health Denials. Each United States Attorney will ensure that whenever there is federal case information regarding individuals who are prohibited from possessing a firearm under the mental health prohibition, such information continues to be entered timely and accurately into the United States Attorneys’ Offices’ case-management system for prompt submission to NICS. ATF should engage in additional outreach to state and local law enforcement on how to use this denial information to better assure public safety. 
    
   Additionally, United States Attorneys will consult with relevant district stakeholders to assess feasibility of adopting disruption of early engagement programs to address mental-health-prohibited individuals who attempt to acquire a firearm. United States Attorneys should consider, when appropriate, recommending court-ordered mental health treatment for any sentences issued to individuals prohibited based on mental health.
    
5. Crime Gun Intelligence Coordination. Federal, state, local, and tribal prosecutors and law enforcement will work together to ensure effective use of the ATF’s Crime Gun Intelligence Centers (CGICs), and all related resources, to maximize the use of modern intelligence tools and technology. These tools can greatly enhance the speed and effectiveness in identifying trigger-pullers and finding their guns, but the success depends in large part on state, local, and tribal law enforcement partners sharing ballistic evidence and firearm recovery data with the ATF.

 

          Federal law enforcement represents only about 15% of all law enforcement resources nationwide. Therefore, partnerships with state, local, and tribal law enforcement and the communities they serve are critical to addressing gun crime. The Department recognizes that sharing information with our state, local, and tribal law enforcement partners at every level will enhance public safety, and provide a greater depth of resources available to address gun crime on a national level.

Six Las Vegas, Nevada area residents were charged with running a fraudulent mass-mailing scheme that tricked hundreds of thousands of consumers into paying more than $10 million in fees for falsely promised cash prizes, the Department of Justice has announced.

The unsealed indictment charges Mario Castro, 51, Jose Salud Castro, 70, Salvador Castro, 53, Miguel Castro, 55, Jose Luis Mendez, 45, and Andrea Burrow, 49, with mail fraud and conspiracy to commit mail fraud.  The indictment, secured by the Department’s Consumer Protection Branch and the U.S. Attorney’s Office for the District of Nevada, also charges Salvador Castro with making a false statement to investigators.  U.S. Postal Inspectors arrested five of the defendants last night. The sixth, Jose Salud Castro, turned himself into authorities this morning.

According to the indictment, the defendants’ prize-notification scheme led victims, many of whom were elderly and vulnerable, to believe that they could pay a small $20 or $30 fee to claim a large cash prize.  The indictment alleged that none of the victims who submitted fees ever received a large cash prize.

“The Department will pursue and prosecute those who defraud elderly or vulnerable consumers,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “We have alleged that these defendants perpetrated a cruel hoax on their victims and relentlessly targeted many with repeated fraudulent mailings.”

The indictment asserts that the defendants operated the scheme from 2010 to February 2018, when postal inspectors executed multiple search warrants and the Department of Justice obtained a court order shutting down the fraudulent mail operation.  Mario Castro, Jose Salud Castro, Salvador Castro, Miguel Castro, and Jose Luis Mendez allegedly worked at the printing and mailing businesses that sent the fraudulent mail and shared the profits from the fraudulent prize notices.  The remaining defendant, Andrea Burrow, opened victim return mail, sorted cash and other payments, and entered data from the victims’ responses into a database that the scheme used to target past victims with more fraudulent mail, according to the indictment.

The defendants are alleged to have ignored multiple cease and desist orders from the United States Postal Service that prohibited their mailing companies from sending fraudulent mail.  The defendants responded by changing the names of their companies and using straw owners to hide their continuing fraud. 

Three of the defendants’ co-conspirators – Patti Kern, Edgar Del Rio, and Sean O’Connor – pleaded guilty to conspiracy to commit mail fraud earlier this year.

“It will be a priority of this office to dismantle organizations like this one that prey on the elderly and vulnerable,” said U.S. Attorney Nicholas Trutanich for the District of Nevada. “We will continue to investigate and prosecute these large-scale frauds that operate in Nevada and across the country.”

“Many people who received these solicitations in the mail thought they were winners, but they were not.  In fact, they were victims of scams exploiting the vulnerable.  For many years, the U.S. Postal Inspection Service has been at the forefront of protecting consumers from fraud.  The consequences of this type of financial fraud scheme are far reaching and damaging.  Anyone who engages in such conduct should know they will not go undetected and will be held accountable,” said Inspector in Charge Delany De Leon-Colon of U.S. Postal Inspection Service’s Criminal Investigations Group at National Headquarters. 

The mail fraud and conspiracy charges each carry a statutory maximum sentence of 20 years in prison.  The false statement charge carries a statutory maximum sentence of five years in prison.  Each charge also carries a statutory maximum fine of $250,000 or twice the gross gain or gross loss from the offense.

An indictment is an accusation by a federal grand jury and is not evidence of guilt.  The defendants should be presumed innocent unless and until proven guilty.

The U.S. Postal Inspection Service investigated the case.  The case is being prosecuted by Trial Attorneys Timothy Finley and Daniel Zytnick of the Department of Justice’s Consumer Protection Branch and Assistant U.S. Attorney Nicholas Dickinson of the District of Nevada. 

Since President Trump signed the bipartisan Elder Abuse Prevention and Prosecution Act (EAPPA) into law, the Department of Justice has participated in hundreds of enforcement actions in criminal and civil cases that targeted or disproportionately affected seniors.  In particular, this past March the Department announced the largest elder fraud enforcement action in American history, charging more than 260 defendants in a nationwide elder fraud sweep.  The Department has likewise conducted hundreds of trainings and outreach sessions across the country since the passage of the Act.  Additional information on the Department of Justice’s efforts to combat elder fraud is at: https://www.justice.gov/civil/consumer-protection-branch/elder-fraud.

With the objective of strengthening cooperation among governments to counter transnational crime and terrorism, the Department of Justice’s Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT), Office of International Affairs and Money Laundering and Asset Recovery Section  of the Criminal Division and the Department’s National Security Division, along with experts from Argentina, Brazil, Paraguay and the United States with experience in countering terrorism, terrorist financing, and transnational crime met for the first time as a Regional Security Mechanism (RSM) in Asunción, Paraguay on Nov. 12 and 13. 

On July 19, during Secretary of State Michael R. Pompeo’s visit to Buenos Aires for a counterterrorism ministerial meeting, Argentina, the United States, Brazil and Paraguay agreed to establish the RSM to bolster cooperation among these governments to counter transnational crime and terrorism. Transnational criminal groups, terrorists and those who support them continue to engage in a wide range of illicit schemes in the region. The RSM focuses on identifying vulnerabilities that these groups are exploiting and on developing solutions to address these threats. The RSM held its first meeting at the expert level this week.

The experts shared information to deepen each country’s understanding of the risks of terrorists and organized criminal groups and those who support them pose to the region; identify vulnerabilities that these groups are exploiting; and develop recommendations to mitigate these risks and increase regional cooperation to combat these groups.   

The Ministry of Foreign Affairs of Paraguay hosted this two-day meeting and led the delegation of the Government of Paraguay composed of investigators, prosecutors, financial analysts and customs officials.   

This initiative is part of the continuous effort of the U.S. Embassy of Paraguay in promoting cooperation to increase local and regional institutional and inter-institutional capacity, provide staff training and technical assistance, as well as better information exchange between participating countries.   

OPDAT has been in the Tri Border Area (TBA) of Brazil, Paraguay, and Argentina since 2015, posting a money laundering/terrorism financing-focused Intermittent Advisor to Paraguay and a computer hacking and intellectual property adviser to Brazil.  In 2017, OPDAT added a resident advisor in Buenos Aires dedicated to counterterrorism issues in the TBA.  In 2018, OPDAT expanded to add a resident legal advisor in Asunción focused on counterterrorism issues.  In 2020, OPDAT will add a counterterrorism focused intermittent advisor in Brazil. 

The advisor in Buenos Aires has promoted legal and regulatory reforms, provided case-based mentoring and capacity building, and encouraged greater regional cooperation.  Over the past two years, after receiving OPDAT training and mentoring on these topics, Argentine authorities are increasingly using undercover officers, informal sources of information, cooperating defendants, and interagency task forces to advance investigations involving complex crimes and criminal organizations.  In July, Argentina – also with OPDAT support – developed and deployed a domestic terrorist designation regime, which included Hizballah and its top leaders as designated terrorists. 

In August, Paraguay announced its own terrorist designations.  These designations, also developed with OPDAT support, declared Hamas, Hizballah, ISIS, and Al Q’aida to be terrorist organizations.  The designations, which were passed with technical assistance from OPDAT are currently awaiting the President’s signature, will serve as the basis for freezing assets linked to designated terrorist organizations or any entity linked to terrorism or its financing.  In addition to work on terrorist designations and asset freezes, the Paraguay program coordinates and conducts training to counter terrorist financing; provides case-based mentoring to build capacity to investigate, prosecute, and adjudicate such cases; and continues to work with Paraguayans to form a financial crimes/terrorism financing task force.

Peter Volino, a former vice president at Industrial and Commercial Bank of China Financial Services LLC (ICBCFS), pleaded guilty to a criminal antitrust charge for his involvement in a bid-rigging conspiracy for certain financial instruments, the Department of Justice announced.

Volino admitted that, from at least as early as May 2012 until at least August 2014, he and his counterparts at other broker-dealers conspired to submit rigged bids to borrow pre-release American Depository Receipts (ADRs).  Volino’s plea is the fourth in the investigation; Banca IMI Securities Corp., ICBCFS, and former Banca IMI executive Larry Meyers previously pleaded guilty.

“The guilty plea announced today represents the culmination of a years-long investigation by the Division’s prosecutors and our FBI partners into collusion that infected bidding for pre-release ADRs,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division.  “The Division is committed to detecting, rooting out, and prosecuting antitrust crimes affecting our financial markets and to holding personally accountable executives who try to get ahead by violating the antitrust laws.”

Worldwide, thousands of publicly traded companies list their shares of common stock only on foreign stock exchanges.  Most U.S. investors are unable to purchase or sell such foreign shares.  The U.S. Securities and Exchange Commission, however, permits four U.S. depository banks to create ADRs, which represent foreign ordinary shares and can be traded in the United States.  Through the purchase and sale of ADRs, U.S. investors are able to gain exposure to — including the ability to receive dividends from — companies whose common stock is listed only on foreign exchanges.

Volino pleaded guilty to conspiring to borrow pre-release ADRs from U.S. depository banks at artificially suppressed rates.  During the conspiracy, a U.S. depository bank began using an auction-style process for pre-release ADRs and invited ICBCFS and other broker-dealers to submit competitive bids for rates to borrow ADRs.  In response, Volino and his co-conspirators conspired to suppress competition between them in an effort to artificially increase their profits under the auction-style process.  On at least 24 occasions, ICBCFS, through Volino, reached an agreement with one or more co-conspirators as to the bids they would submit to U.S. depository banks.  On many occasions, the conspirators agreed that they all would submit the same bid.  Volino and his co-conspirators reached these agreements using, among other means, private chat rooms and text messages.

“As demonstrated through this multi-year investigation, which has led to four plea agreements, the FBI is committed to rooting out corruption and fraud,” said Assistant Director in Charge Timothy R. Slater of the FBI’s Washington Field Office.  “Today’s plea is the result of our continuous, persistent efforts to protect competition in the financial market and identify those engaged in fraudulent conduct.”

A criminal violation of Section 1 of the Sherman Act carries a maximum term of imprisonment of 10 years and a maximum fine of $1 million for individuals.  The fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

The Washington Criminal II Section of the Antitrust Division, the FBI’s International Corruption Unit, and the FBI’s Washington Field Office are conducting the investigation into bid rigging in the market for pre-release ADRs. Anyone with information in connection with this investigation is urged to call the Antitrust Division’s Washington Criminal II Section at 202-598-4000 or visit www.justice.gov/atr/contact/newcase.html.

On Nov. 14, 2019, the Attorney General published and submitted to Congress the first semiannual report on the Fix NICS Act. The report, required by the Fix NICS Act passed by Congress in March 2018, reflects strong compliance with the Act and demonstrates renewed efforts at all levels of government to improve the sharing of records and information that are vital to the effective operation of the National Instant Criminal Background Check System (NICS).

 “An effective NICS system is critical to ensuring that we keep guns out of the hands of those who should not have them,” said Attorney General William P. Barr. “I am encouraged by the results of this initial report. Fix NICS implementation is still in its infancy, yet already we’re seeing great strides being made across government – state, tribal, and federal law enforcement - to strengthen the NICS. Given the preliminary data, it is clear that the Fix NICS Act is well on its way to doing exactly what it was intended to do – make the NICS better.”

The NICS is a computerized system designed to help determine if a person is disqualified from possessing or receiving firearms by conducting a search of available relevant records. The databases searched by the NICS contain records with information relevant to the legal prohibitions against firearm possession and purchasing under both federal and state law. To function effectively, the NICS must have access to complete, accurate, and timely information submitted by relevant agencies in all levels of government across the country.

The 2018 Fix NICS Act was passed to encourage government agencies to improve their records submission processes and further strengthen the NICS. Under the Fix NICS Act:

• Federal agencies:
  • must report certain record submission metrics to the Attorney General in semiannual certifications; and
  • must establish four-year implementation plans to improve records submissions.
• States and tribal governments:
  • are incentivized with grant preferences to establish four-year implementation plans.
• The Attorney General:
  • must publish and submit to Congress a semiannual report on federal agency compliance with the Act; and
  • must determine whether federal agencies, states, and Indian tribal governments have achieved substantial compliance with the benchmarks set out in their implementation plans. 

Report Highlights:

Compliance:

• 45 federal agencies submitted certifications and implementation plans
• All 50 states, the District of Columbia, and Indian tribal governments established implementation plans and
• Another 44 federal agencies certified they do not have any relevant records

Early Results:

The efforts by federal agencies, states, and Indian tribal governments under the Act are already paying off. Between April 2018 and August 2019:

• There was an increase of over six million records in the three national databases searched with every NICS check—a 6.2 percent increase. In addition, there was a 15 percent increase in records in one of those databases, the NICS Indices.
• The number of Firearm Retrieval Referrals (FRRs) (where a prohibited person is able to purchase a firearm because the background check could not be concluded within three business days due to incomplete records) decreased each month in comparison to the same month during the previous year, for an average monthly decline of 102 FRRs. 
• With the exception of June 2018, there was an increase in the percentage of NICS checks resulting in an immediate determination (not requiring a delay for further research) compared to the previous year. Specifically, there was an average increase of 0.51 percent for each month when compared with the same month of the previous year.  

• From May 2019 through July 2019, the military branches enhanced their record reporting by increasing entries into the Controlled Substance category by 10 percent, with an overall increase in multiple categories of 2.63 percent.
• The U.S. Customs and Border Protection entered approximately 13 million illegal or unlawful alien records into the NICS Indices in October 2019.

Although the implementation plans have been in place for just a few months, these early indicators are encouraging. As the plans are executed over the next several years, the Department of Justice expects to see a real and lasting positive impact on NICS records and operations. 

The complete report can be accessed here: https://www.justice.gov/ag/fix-nics-report-2019.

Representatives from the Office of International Affairs and the Judicial Attaché Office of the U.S. Department of Justice’s Criminal Division; the U.S. Department of State; and the Attorney General of the Republic of Colombia, Mr. Fabio Espitia Garzón; the Minister of Justice, Ms. Margarita Cabello Blanco; and representatives from Colombia’s Ministry of Foreign Affairs are meeting in Cartagena, Colombia this week for a consultations meeting on extradition and legal assistance matters between Colombia and the United States.

This meeting is a mechanism whose purpose is to address judicial cooperation in criminal matters, expedite proceedings between both countries in extradition and legal assistance matters, share good practices and experiences, hold working group sessions, and have a direct dialogue regarding the challenges imposed by the joint work in the fight against transnational organized crime.

Similarly, issues related to criminal finances, tools to economically dismantle organizations devoted to organized crime, and asset sharing and forfeiture will be addressed.

The Colombian State is also represented by the Directors from the Office of the Attorney General of the Republic of Colombia, including the Director of the International Affairs Office; the Delegate against Organized Crime; the Delegate for Criminal Finances; the Special Director of Extinction of Domain and Asset Forfeiture;  the Vice-Minister of Justice and Law, Juan Francisco Espinosa Palacios; and the Directors of International Affairs and Transitional Justice from the Ministry of Justice. 

Advisers from the Directorate of International Legal Affairs and the Directorate of Migration, Consular Affairs and Citizen Service of the Ministry of Foreign Affairs of Colombia also will participate.

There have been three previous similar meetings: the first two held in 2016 and 2017 in Bogotá, Colombia, and the last one held in 2018 in Washington, DC.

 

The Louisiana Department of Health has agreed to resolve allegations that it submitted false and inflated Medicaid claims for long-term nursing home and hospice care, the Department of Justice announced today.  Under the settlement agreement, the state agency has agreed to pay $13,422,550. 

“Today’s settlement demonstrates that we will take whatever steps are appropriate in our effort to protect federal healthcare programs, including Medicaid, from false claims,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division.  “Anyone who seeks to profit at the expense of Federal taxpayers, including state agencies, will face appropriate consequences.”

“This office will remain vigilant in its efforts to ensure the integrity of the Medicaid program by continuing to pursue those who commit improprieties against the program – whether they be providers or beneficiaries, or those more central to the administration of the program,” said Brandon J. Fremin, the U.S. Attorney for the Middle District of Louisiana.  “The people of Louisiana deserve it.  I am grateful to the dedicated AUSAs and staff in our Civil Division and to the Office of Inspector General for the U.S. Department of Health and Human Services for their hard work and dedication to this very important matter.”

Medicaid is a joint federal and state program providing financial assistance to individuals with low incomes to enable them to receive medical care.  The Medicaid program makes quarterly grant awards to each participating state covering an amount, commonly known as the federal share, of the state’s expenditures for healthcare services covered by the state’s Medicaid plan.  The federal share is determined by a percentage rate that is subject to change from quarter to quarter.  Nursing homes and hospices typically submitted claims to Louisiana on the tenth day of the month following the month during which the services were actually provided.  Louisiana then paid these claims, sought Federal reimbursement for those expenditures, and received Federal reimbursement based on the rate in effect at that time.

The United States alleged that the Louisiana Department of Health knew that the rates determining the federal share of Louisiana’s Medicaid payments were set to decrease following the months of December 2010, March 2011, June 2011, and September 2013.  To receive the higher Federal share percentage rates in effect during these months, the Louisiana Department of Health fraudulently caused its healthcare contractor, Molina Medical Solutions, to prepare, submit, and pay claims for nursing home and hospice services in these months, before the providers had submitted to Louisiana any claims for them.  Louisiana then claimed Federal reimbursement for those premature payments.  As a result, the Louisiana Department of Health received a Federal share based upon the higher percentage rate in effect in those months, rather than the lower percentage rate in effect the following months when the providers actually submitted their claims to Louisiana. 

This settlement was the result of an investigation by the Civil Division of the Department of Justice, the U.S. Attorney’s Office for the Middle District of Louisiana, and the U.S. Department of Health and Human Services Office of Inspector General. 

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

          SHAWN N. ANDERSON, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that defendant JIMMY LAW, age 61, from Turlock, California, was sentenced in the United States District Court of Guam to 120 months imprisonment for Conspiracy to Distribute Methamphetamine of fifty grams or more, in violation of 21 U.S.C. § 841(a)(1).  Senior Judge Alex R. Munson also ordered five years of supervised release following imprisonment, 100 hours of community service, and a mandatory $100 assessment fee.  In addition, defendants convicted of a federal drug offense may no longer qualify for certain federal benefits.

          On January 1, 2013, through March 7, 2017, the U.S. Postal Inspector and the Drug Enforcement Administration intercepted four packages in the mail.  The packages were found to contain in excess of 110 net grams of methamphetamine hydrochloride (“ice”).  Further investigation revealed that Jimmy Law mailed the packages to his ex-girlfriend.  Once on Guam, she intended to distribute the drug to others on the island.

          U.S. Attorney Anderson stated, “Federal law enforcement continues to aggressively pursue drug trafficking activity on Guam.  This case demonstrates the benefits of effective partnerships and the results of long-term investigations.  Our office vigorously enforces federal drug laws at every opportunity.  While our distance from the mainland is great, off island sources of supply will be charged and held accountable in our districts.”

          This case was the result of a joint investigation by the U.S. Postal Service and the Drug Enforcement Administration.  The case was prosecuted by Rosetta L. San Nicolas, Assistant United States Attorney in the Districts of Guam and the Northern Mariana Islands.

Today, Attorney General William P. Barr announced the launch of Project Guardian, a new initiative designed to reduce gun violence and enforce federal firearms laws across the country. Specifically, Project Guardian focuses on investigating, prosecuting, and preventing gun crimes.

Reducing gun violence and enforcing federal firearms laws have always been among the Department’s highest priorities. In order to develop a new and robust effort to promote and ensure public safety, the Department reviewed and adapted some of the successes of past strategies to curb gun violence. Project Guardian draws on the Department’s earlier achievements, such as the “Triggerlock” program, and it serves as a complementary effort to the success of Project Safe Neighborhoods (PSN). In addition, the initiative emphasizes the importance of using all modern technologies available to law enforcement to promote gun crime intelligence.

“Gun crime remains a pervasive problem in too many communities across America. Today, the Department of Justice is redoubling its commitment to tackling this issue through the launch of Project Guardian,” said Attorney General William P. Barr. “Building on the success of past programs like Triggerlock, Project Guardian will strengthen our efforts to reduce gun violence by allowing the federal government and our state and local partners to better target offenders who use guns in crimes and those who try to buy guns illegally.”

“ATF has a long history of strong partnerships in the law enforcement community,” said Acting Director Regina Lombardo. “Make no mistake, the women and men of ATF remain steadfast to our core mission of getting crime guns off of our streets. ATF and U.S. Attorneys nationwide will leverage these partnerships even further through enhanced community outreach initiatives and coordination with local, state, and tribal law enforcement and prosecutors to cut the pipeline of crime guns from those violent individuals who seek to terrorize our communities. Project Guardian will enhance ATF’s Crime Gun Intelligence, to include identifying, investigating and prosecuting those involved in the straw purchases of firearms, lying on federal firearms transaction forms, and those subject to the mental health prohibition of possessing firearms.” 

Project Guardian’s implementation is based on five principles:

• Coordinated Prosecution. Federal prosecutors and law enforcement will coordinate with state, local, and tribal law enforcement and prosecutors to consider potential federal prosecution for new cases involving a defendant who: a) was arrested in possession of a firearm; b) is believed to have used a firearm in committing a crime of violence or drug trafficking crime prosecutable in federal court; or c) is suspected of actively committing violent crime(s) in the community on behalf of a criminal organization.
• Enforcing the Background Check System. United States Attorneys, in consultation with the Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) in their district, will create new, or review existing, guidelines for intake and prosecution of federal cases involving false statements (including lie-and-try, lie-and-buy, and straw purchasers) made during the acquisition or attempted acquisition of firearms from Federal Firearms Licensees. Particular emphasis is placed on individuals convicted of violent felonies or misdemeanor crimes of domestic violence, individuals subject to protective orders, and individuals who are fugitives where the underlying offense is a felony or misdemeanor crime of domestic violence; individuals suspected of involvement in criminal organizations or of providing firearms to criminal organizations; and individuals involved in repeat denials.
• Improved Information Sharing. On a regular basis, and as often as practicable given current technical limitations, ATF will provide to state law enforcement fusion centers a report listing individuals for whom the National Instant Criminal Background Check System (NICS) has issued denials, including the basis for the denial, so that state and local law enforcement can take appropriate steps under their laws.
• Coordinated Response to Mental Health Denials. Each United States Attorney will ensure that whenever there is federal case information regarding individuals who are prohibited from possessing a firearm under the mental health prohibition, such information continues to be entered timely and accurately into the United States Attorneys’ Offices’ case-management system for prompt submission to NICS. ATF should engage in additional outreach to state and local law enforcement on how to use this denial information to better assure public safety. Additionally, United States Attorneys will consult with relevant district stakeholders to assess feasibility of adopting disruption of early engagement programs to address mental-health-prohibited individuals who attempt to acquire a firearm. United States Attorneys should consider, when appropriate, recommending court-ordered mental health treatment for any sentences issued to individuals prohibited based on mental health.
• Crime Gun Intelligence Coordination. Federal, state, local, and tribal prosecutors and law enforcement will work together to ensure effective use of the ATF’s Crime Gun Intelligence Centers (CGICs), and all related resources, to maximize the use of modern intelligence tools and technology. These tools can greatly enhance the speed and effectiveness in identifying trigger-pullers and finding their guns, but the success depends in large part on state, local, and tribal law enforcement partners sharing ballistic evidence and firearm recovery data with the ATF. Federal law enforcement represents only about 15 percent of all law enforcement resources nationwide. Therefore, partnerships with state, local, and tribal law enforcement and the communities they serve are critical to addressing gun crime. The Department recognizes that sharing information with our state, local, and tribal law enforcement partners at every level will enhance public safety, and provide a greater depth of resources available to address gun crime on a national level.   

For more information on Project Guardian, see the Attorney General’s memorandum at: https://www.justice.gov/ag/project-guardian-memo-2019/download.

Today, Attorney General William P. Barr announced the launch of Project Guardian, a new initiative designed to reduce gun violence and enforce federal firearms laws across the country. Specifically, Project Guardian focuses on investigating, prosecuting, and preventing gun crimes.

Reducing gun violence and enforcing federal firearms laws have always been among the Department’s highest priorities. In order to develop a new and robust effort to promote and ensure public safety, the Department reviewed and adapted some of the successes of past strategies to curb gun violence. Project Guardian draws on the Department’s earlier achievements, such as the “Triggerlock” program, and it serves as a complementary effort to the success of Project Safe Neighborhoods (PSN). In addition, the initiative emphasizes the importance of using all modern technologies available to law enforcement to promote gun crime intelligence.

“Gun crime remains a pervasive problem in too many communities across America. Today, the Department of Justice is redoubling its commitment to tackling this issue through the launch of Project Guardian,” said Attorney General William P. Barr. “Building on the success of past programs like Triggerlock, Project Guardian will strengthen our efforts to reduce gun violence by allowing the federal government and our state and local partners to better target offenders who use guns in crimes and those who try to buy guns illegally.”

“Partnerships are key to the success of any law enforcement initiative, and the U.S. Attorney’s Office is working side by side with our federal, state and local agencies to address firearms offenses and related violent crimes in the Northern District of Ohio,” said Justin Herdman, United States Attorney.  “Our firearms-related prosecutions are at an all-time high.  Project Guardian, and its emphasis on using all avenues to identify those who wish to illegally possess firearms and endanger our neighbors and communities, will complement these efforts and help to focus our resources on those posing the greatest threat to our families, friends, and neighbors.”

 “ATF has a long history of strong partnerships in the law enforcement community,” said Acting Director Regina Lombardo. “Make no mistake, the women and men of ATF remain steadfast to our core mission of getting crime guns off of our streets. ATF and U.S. Attorneys nationwide will leverage these partnerships even further through enhanced community outreach initiatives and coordination with local, state, and tribal law enforcement and prosecutors to cut the pipeline of crime guns from those violent individuals who seek to terrorize our communities. Project Guardian will enhance ATF’s Crime Gun Intelligence, to include identifying, investigating and prosecuting those involved in the straw purchases of firearms, lying on federal firearms transaction forms, and those subject to the mental health prohibition of possessing firearms.” 

Project Guardian’s implementation is based on five principles:

Coordinated Prosecution. Federal prosecutors and law enforcement will coordinate with state, local, and tribal law enforcement and prosecutors to consider potential federal prosecution for new cases involving a defendant who: a) was arrested in possession of a firearm; b) is believed to have used a firearm in committing a crime of violence or drug trafficking crime prosecutable in federal court; or c) is suspected of actively committing violent crime(s) in the community on behalf of a criminal organization.

Enforcing the Background Check System. United States Attorneys, in consultation with the Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) in their district, will create new, or review existing, guidelines for intake and prosecution of federal cases involving false statements (including lie-and-try, lie-and-buy, and straw purchasers) made during the acquisition or attempted acquisition of firearms from Federal Firearms Licensees.
 
Particular emphasis is placed on individuals convicted of violent felonies or misdemeanor crimes of domestic violence, individuals subject to protective orders, and individuals who are fugitives where the underlying offense is a felony or misdemeanor crime of domestic violence; individuals suspected of involvement in criminal organizations or of providing firearms to criminal organizations; and individuals involved in repeat denials.

Improved Information Sharing. On a regular basis, and as often as practicable given current technical limitations, ATF will provide to state law enforcement fusion centers a report listing individuals for whom the National Instant Criminal Background Check System (NICS) has issued denials, including the basis for the denial, so that state and local law enforcement can take appropriate steps under their laws.

Coordinated Response to Mental Health Denials. Each United States Attorney will ensure that whenever there is federal case information regarding individuals who are prohibited from possessing a firearm under the mental health prohibition, such information continues to be entered timely and accurately into the United States Attorneys’ Offices’ case-management system for prompt submission to NICS. ATF should engage in additional outreach to state and local law enforcement on how to use this denial information to better assure public safety. 
 
Additionally, United States Attorneys will consult with relevant district stakeholders to assess feasibility of adopting disruption of early engagement programs to address mental-health-prohibited individuals who attempt to acquire a firearm. United States Attorneys should consider, when appropriate, recommending court-ordered mental health treatment for any sentences issued to individuals prohibited based on mental health.

Crime Gun Intelligence Coordination. Federal, state, local, and tribal prosecutors and law enforcement will work together to ensure effective use of the ATF’s Crime Gun Intelligence Centers (CGICs), and all related resources, to maximize the use of  modern intelligence tools and technology. These tools can greatly enhance the speed and effectiveness in identifying trigger-pullers and finding their guns, but the success depends in large part on state, local, and tribal law enforcement partners sharing ballistic evidence and firearm recovery data with the ATF.

Federal law enforcement represents only about 15% of all law enforcement resources nationwide. Therefore, partnerships with state, local, and tribal law enforcement and the communities they serve are critical to addressing gun crime. The Department recognizes that sharing information with our state, local, and tribal law enforcement partners at every level will enhance public safety, and provide a greater depth of resources available to address gun crime on a national level.   

###

 

 

The Department of Justice has announced that ABS Development Corporation (ABS) has agreed to pay $2.8 million and give up $16 million in potential administrative claims to settle allegations that it violated the False Claims Act by fraudulently obtaining a foreign military sales contract reserved for American companies.  ABS, a Delaware corporation based in New York, is a subsidiary of Ashtrom International, Ltd. of Israel.

The settlement announced today resolves allegations that ABS fraudulently induced the Army to award ABS a contract for the renovation of the Haifa, Israel shipyard by falsely misrepresenting that it would perform the contract when, in fact, its Israeli parent company, Ashtrom, intended to do so; and for presenting false claims to the United States certifying that it was performing work as the prime contractor when in fact the work was performed by Ashtrom.  Foreign military sales contracts require prime contractors to be American companies that perform a substantial portion of the work.  The Army would not have awarded the contract to ABS, nor paid ABS’ invoices, had it known that Ashtrom, not ABS, was going to perform and did perform the contract. 

“Those who contract with the government are obliged to follow the law,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “We will continue to enforce rules designed to protect American businesses and taxpayers.”    

“The Defense Criminal Investigative Service (DCIS) is committed to protecting the integrity of the Department of Defense acquisitions process and safeguarding taxpayer dollars,” said Stanley A. Newell, the Special Agent-in-Charge of the DCIS, Transnational Operations Field Office.  “Our dedicated special agents will thoroughly investigate allegations of fraud and pursue all available remedies against those who subvert DoD contracts for their own gain.”

This settlement was the result of a coordinated effort among the Civil Division’s Commercial Litigation Branch, the Defense Criminal Investigative Service, the Major Procurement Fraud Unit of the Army’s Criminal Investigative Command, and the Defense Contract Audit Agency.  

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

A large-scale, 90-day law enforcement operation, known as “Operation Triple Beam Albuquerque,” concluded on Oct. 31, 2019, with the arrests of 327 alleged fugitives from throughout Bernalillo County and the Albuquerque, New Mexico metropolitan area. 

Led by the U.S. Marshals Southwest Investigative Fugitive Team (SWIFT), multiple federal, state and local law enforcement agencies concentrated their efforts on known violent offenders.

During OTB Albuquerque, SWIFT located and apprehended 327 alleged state, local and federal fugitives, including 59 state probation and parole absconders, 10 individuals wanted for homicide, 20 for weapons offenses, 13 for sex crimes, 50 for assault, and 91 on narcotics charges. In the Santa Fe and Farmington communities, investigators made 92 arrests.

The operation resulted in the seizure of 43 illegal firearms, more than 50 pounds of methamphetamine, four pounds of heroin, and two pounds of cocaine. In addition, 31 stolen vehicles were recovered and $50,000 was seized.

“I commend the work of the brave men and women of the U.S. Marshals Service on their outstanding execution of Operation Triple Beam, a nationwide effort by the Marshals to target violent, gang-related crime in some of America’s most dangerous cities,” said Attorney General William P. Barr. “The Marshals are truly America’s fugitive hunters, with a proud tradition dating back to the founding of the United States. Their unyielding commitment to justice, in partnership with our state and local colleagues, made this initiative a great success.”

“We brought Operation Triple Beam, our mobile gang enforcement platform, to Albuquerque to target the gang-related fugitives fueling the violent crime in the area,” said US Marshals Service Director Donald Washington. “The U.S. Marshals in the District of New Mexico, along with dedicated inspectors in our Investigative Operations Division, and all of our partner agencies, achieved results that illustrate our full commitment to make communities safer by addressing violent crime at its core and taking the worst of the worst off the streets. The good citizens of New Mexico have our enduring support.”

“The U.S. Attorney’s Office is committed to working with its law enforcement partners to combat violent crime throughout New Mexico,” said U.S. Attorney John C. Anderson. “We commend the U.S. Marshals Service for regularly leading multi-agency operations like Triple Beam throughout the state that have made our communities safer by taking hundreds of fugitives off our streets.”

“Operation Triple Beam was an outstanding public safety effort by all personnel involved, and the unified approach for law enforcement resulted in hundreds of arrests, including many for dangerous outstanding warrants. I remain committed to collaborating with local and federal authorities to keep our children, families, and businesses safe,” said Bernalillo County Sheriff Manuel Gonzales III.

OTB Albuquerque Participating Agencies

• U.S. Marshals Service
• U.S. Attorney’s Office
• Bernalillo County Sheriff’s Office
• New Mexico State Police
• New Mexico Division of Probation and Parole
• Farmington Police Department
• San Juan County Sheriff’s Office
• Espanola Police Department
• Santa Fe County Sheriff’s Office
• Albuquerque Police Department
• Metropolitan Detention Center
• Sandoval County Sheriff’s Office
• Rio Rancho Police Department
• Second Judicial District Attorney’s Office
• New Mexico Attorney General’s Office
• Drug Enforcement Administration
• Bureau of Alcohol, Tobacco, Firearms and Explosives
• Homeland Security Investigations
• FBI

This is the second OTB conducted by the U.S. Marshals in New Mexico this year. OTB Las Cruces concluded April 12, 2019, with the arrest of 154 fugitives throughout Dona Ana County; there were 115 felony arrests within the City of Las Cruces.

OTB provides communities with immediate relief from violent, gang-related crime and targets fugitives who commit violent crime and those who provide them safe harbor. Since the Department of Justice reinvigorated Project Safe Neighborhoods in 2017, U.S. Marshals have launched 33 OTB collaborations of local, state, federal and tribal law enforcement agencies in some of the nation’s most violence-plagued communities, resulting in more than 6,000 arrests, 1,200 firearms confiscations, and the seizure of $1.8 million.

The Department of Justice announced today that it has reached a settlement with Perspective Talent LLC, a Pembroke Pines, Florida information technology recruiting and staffing firm. The settlement resolves the Department’s investigation into whether the firm discriminated against work-authorized non-U.S. citizens, including asylees, because of their citizenship status, in violation of the Immigration and Nationality Act (INA). 

"Recruitment agencies canno post unlawful job adervitsemetns that operate as artificial barriers and narrow employment opportunities based on citizenship status or national origin,”  said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “The Civil Rights Division is committed to removing these discriminatory barriers to employment.”

The Department’s investigation arose from a complaint made by a work-authorized asylee alleging that Perspective Talent’s discriminatory job advertisement excluded him from consideration based on his citizenship status.  After investigating the complaint, the Department concluded that Perspective Talent routinely posted job advertisements that unlawfully restricted applicants to U.S. citizens, lawful permanent residents, and TN-1 visa holders.  Based on this practice, Perspective Talent initially failed to refer the complainant for a job because of his asylee status.  After learning of the Department’s investigation, Perspective Talent took immediate corrective action by referring the complainant for the position and correcting its job advertisements.  Federal law generally prohibits discrimination in recruiting based on a worker’s citizenship status or national origin.

Under the terms of the agreement, the firm will participate in training on the INA’s anti-discrimination provision, change its policies and procedures, and be subject to departmental monitoring and reporting requirements to ensure that its job advertisements do not unlawfully exclude individuals who are authorized to work in the United States based on their citizenship or immigration status. 

The Civil Rights Division’s Immigrant and Employee Rights Section (IER) is responsible for enforcing the anti-discrimination provision of the INA. Among other things, the statute prohibits citizenship status and national origin discrimination in hiring, firing, or recruitment or referral for a fee; unfair documentary practices; retaliation and intimidation.   

For more information about protections against employment discrimination under immigration laws, call IER’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call IER’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar; email IER@usdoj.gov; or visit IER’s English or Spanish websites.  You can also sign up to receive updates about IER’s work by subscribing to GovDelivery.

Applicants or employees who believe they were subjected to discrimination based on their citizenship, immigration status, or national origin in hiring, firing, or recruitment or referral for a fee; discrimination in the employment eligibility verification process (Form I-9 and E-Verify) based on their citizenship, immigration status, or national origin; or retaliation can file a charge or contact IER’s worker hotline for assistance.

The Department of Justice announced today it has awarded more than $100 million in funding, through the Office of Justice Programs (OJP), to combat human trafficking and provide vital services to trafficking victims throughout the United States.

“Human traffickers remain a dire threat to human rights across the globe and their actions pose a serious danger to public safety right here in our own country,” said Attorney General William P. Barr. “I’m proud that these resources will help our law enforcement officers and victim service providers hold perpetrators accountable and give victims of these abominable crimes a place to turn for refuge and support.”

“The fight against human trafficking is never ending, and it is our front-line law enforcement officers and an army of compassionate service providers who are leading the charge,” said Office of Justice Programs Principal Deputy Assistant Attorney General Katharine T. Sullivan. “The Attorney General has made it clear that the Department of Justice will use every means at its disposal to bring traffickers to justice and serve trafficking victims. We are proud to support his vision of a nation, and a world, free of the scourge of human trafficking.”

Approximately $80 million of the funds were awarded under five Office for Victims of Crime (OVC) grant programs. The remaining $20 million were awarded by OJP's Bureau of Justice Assistance (BJA), National Institute of Justice (NIJ) and Office of Juvenile Justice and Delinquency Prevention (OJJDP) to jurisdictions, service providers and task forces all over the country.

Grants awarded under FY 2019 OVC programs aim to enhance the quality and quantity of services available to survivors of human trafficking. Specific programs being funded include:

• The Direct Services to Support Victims of Human Trafficking program gives nearly $53 million to 77 organizations to enhance the quality and quantity of services available to victims of all forms of trafficking.
• The Integrated Services for Minor Victims of Human Trafficking program awards over $15 million total to 32 programs to provide minor victims of trafficking with high-quality services that are developmentally appropriate and tailored for their individual needs.
• The Improving Outcomes for Child and Youth Victims of Human Trafficking program gives over $6 million total to four organizations to integrate human trafficking policy and programming at the state level and to enhance coordinated, multidisciplinary and statewide approaches to serving trafficked youth.
• The Field-Generated Innovations in Assistance to Victims of Human Trafficking program awards $4 million total to five programs to fill gaps and improve the victim services field’s response to human trafficking.
• The Specialized Human Trafficking Training and Technical Assistance and Resource Development program awarded $1 million to provide efficient and streamlined technical assistance and training to improve services offered to labor trafficking victims nationwide.       

Grants awarded under FY 2019 OJJDP programs will support organizations in developing their capacity to respond to the needs of children and youth who are victims of domestic sex trafficking and labor trafficking. The Specialized Services and Mentoring for Child and Youth Victims of Sex Trafficking and Sexual Exploitation and the Preventing Sex Trafficking of Girls and Involvement in the Juvenile Justice System grant programs provide more than $4 million to nine organizations to support child and youth victims of sexual exploitation and domestic sex trafficking and girls involved in the juvenile justice system.

BJA awarded 13 grants totaling nearly $11 million under the Enhanced Collaborative Model to Combat Human Trafficking: Supporting Law Enforcement’s Role. This initiative helps law enforcement organizations build capacity and operational effectiveness as core members of collaborative, multidisciplinary human trafficking task forces.

NIJ awarded over $2 million to five research organizations under the Research and Evaluation on Trafficking in Persons Program, which funds research and evaluation projects that help federal, state, local and tribal criminal justice agencies and victim service providers respond to the challenges posed by human trafficking in their jurisdictions.

For a complete list of individual grant programs, award amounts, and jurisdictions that will receive funding, visit: https://ojp.gov/newsroom/pressreleases/2019/ojp-news-10082019_a.pdf

The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Katharine T. Sullivan, provides federal leadership, grants, training, technical assistance and other resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal and juvenile justice systems. More information about OJP and its components can be found at www.ojp.gov.

Attorney General William P. Barr issued the following statement:

"On Veterans Day, we honor the brave Americans who, from the founding of our nation to the present, have sacrificed so much to answer the call to service.  The American people are deeply fortunate that there have been people at every crossroad of history willing to stand up to safeguard our great nation. At the Department of Justice, we recognize that our critical work has only been possible because of the courageous Americans who have given so much while serving at home and abroad. We thank our veterans now and always for their contributions to safety, security, and peace."

Fifteen individuals, including two former company owners, were charged in a superseding indictment unsealed today for their alleged participation in a scheme to defraud investors in the United States and worldwide by fraudulently marketing approximately $140 million in financial instruments known as “binary options,” announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Assistant Director in Charge Timothy R. Slater of the FBI’s Washington Field Office.

Yakov Cohen, 27; Yosef Herzog, 54; Ori Maymon, 33; Nissim Alfasi, 33; Elad Bigelman, 37; Runal Jeebun, 29; Sabrina Elofer, 28; Afik Tori, 27; Anog Maarek, 28; Oron Montgomery, 38; David Barzilay, 41; Gilad Mazugi, 36; Hadas Ben Haim, 34; Yousef Bishara, 32; and Nir Erez, 29, all current or former residents of Israel, were charged in an indictment returned in the District of Maryland with one count of conspiracy to commit wire fraud and three counts of wire fraud.  Maarek appeared Friday before U.S. Magistrate Judge Timothy J. Sullivan in the District of Maryland.  Maarek was extradited from Hungary, after his arrest in September 2019, by Hungarian law enforcement. 

The indictment alleges that beginning in 2014, the defendants and their co-conspirators fraudulently sold and marketed binary options to investors located in the United States and throughout the world through two websites, known as BinaryBook and BigOption.  The indictment alleges that the defendants and their co-conspirators all worked for an Israel-based company called Yukom Communications, a purported sales and marketing company.  The indictment further alleges that Cohen and Herzog had ownership interests in Yukom Communications and other related entities that were used to perpetrate the fraud scheme.

As alleged in the indictment, the defendants and their co-conspirators misled investors by falsely claiming to represent the interests of investors when, in fact, the owners of BinaryBook and BigOption profited when investors lost money.  In addition, the indictment alleges that the defendants and their co-conspirators misrepresented the suitability of and expected return on investments through BinaryBook and BigOption, used false names and qualifications when talking to investors, and falsely claimed to be working from London, when they were working from Israel.  The indictment alleges the defendants and their co-conspirators also misrepresented whether and how investors could withdraw funds from their accounts and misrepresented the terms of so-called “bonuses,” “risk free trades” and “insured trades,” and deceptively used these supposed benefits in a manner that in fact harmed investors.

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

In a related case, Lee Elbaz, the former CEO of Yukom and a citizen of Israel, was found guilty in August 2019 after a three-week jury trial of one count of conspiracy to commit wire fraud and three counts of wire fraud.  Five additional former employees of Yukom and its affiliated companies have also pleaded guilty to conspiracy to commit wire fraud.

The FBI’s Washington Field Office investigated this case.  Assistant Chiefs L. Rush Atkinson and Caitlin R. Cottingham of the Criminal Division’s Fraud Section are prosecuting the case.  The Criminal Division’s Office of International Affairs also provided assistance in this matter.

The Department of Justice announced today that it has filed an amended complaint that adds Arkansas as a plaintiff in the suit and proposed settlement relating to the proposed merger of T-Mobile and Sprint.  Arkansas joins Colorado, Florida, Kansas, Louisiana, Nebraska, Ohio, Oklahoma and South Dakota in the settlement, which is designed to launch Dish Network Corp., a Colorado-based satellite television provider, as a fourth nationwide provider of retail mobile wireless services.  In addition to protecting competition, the proposed settlement will expedite the availability of high-quality 5G networks for American consumers and entrepreneurs.

“We are gratified that Arkansas shares our view of the tremendous benefits to competition that will arise out of the proposed consent judgment,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division.  “A combined T-Mobile and Sprint, coupled with competition from Dish, will provide increased value to residents of Arkansas and consumers nationwide.” 

The Department’s Antitrust Division and now nine co-plaintiff states have sued to block this transaction, and have agreed to settle the lawsuit based on the proposed settlement.  That settlement, if approved by the court, would resolve the Justice Department’s and the co-plaintiff states’ competitive concerns.

Under the terms of the proposed settlement, T-Mobile and Sprint must divest Sprint’s prepaid business, including Boost Mobile, Virgin Mobile and Sprint prepaid, to Dish.  The proposed settlement also provides for the divestiture of certain spectrum assets to Dish.  Additionally, T-Mobile and Sprint must make available to Dish at least 20,000 cell sites and hundreds of retail locations.  T-Mobile must also provide Dish with robust access to the T-Mobile network for a period of seven years while Dish builds out its own 5G network.

T-Mobile US Inc. is a Delaware corporation headquartered in Bellevue, Washington.  In 2018, T-Mobile posted revenues of more than $43 billion.  Deutsche Telekom AG, a German corporation headquartered in Bonn, Germany, is the controlling shareholder of T-Mobile US Inc. 

Sprint Corporation is a Delaware corporation headquartered in Overland Park, Kansas.  In 2018, its posted revenue was over $32 billion.  Sprint is controlled by SoftBank Group Corp., a Japanese Corporation headquartered in Tokyo, Japan.

The Department of Justice announced today that BB&T Corporation (BB&T) and SunTrust Banks Inc. (SunTrust) have agreed to divest 28 branches across North Carolina, Virginia, and Georgia with approximately $2.3 billion in deposits to resolve antitrust concerns arising from BB&T’s proposed merger with SunTrust. The divestiture constitutes the largest divestiture in a bank merger in over a decade.

Under their agreement with the Justice Department, the companies have agreed to divest SunTrust branches in the Eastern Shore, Virginia; Patrick County, Virginia; Franklin County, Virginia; Henry County/City of Martinsville, Virginia; Lumpkin County, Georgia; Winston-Salem, North Carolina; and Durham-Chapel Hill, North Carolina. The divested assets will include all deposits and loans associated with the divested branches.

“Banks and the financial sector are at the heart of our economy,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “Today’s settlement ensures that banking customers across Virginia, North Carolina, and Georgia will continue to have access to competitively priced banking products, including loans to small businesses, while preserving the investments in innovation and technology this merger is expected to generate.”

The proposed merger is subject to the final approval of the Board of Governors of the Federal Reserve System, as well as the Federal Deposit Insurance Corporation (FDIC).  As a result of the divestitures, the Justice Department will advise the Federal Reserve Board and the FDIC that it will not challenge the merger, provided that (1) the parties divest the branch offices and entire customer relationships (i.e., all deposits and loans) associated with the divestiture branches; (2) the parties commit to the Federal Reserve Board that they will comply with the agreement with the Department; and (3) the parties’ commitments to the Department are included as a condition to any order the Federal Reserve Board enters approving the transaction.

BB&T, headquartered in Winston-Salem, North Carolina, operates in 15 states and the District of Columbia. SunTrust, headquartered in Atlanta, Georgia, operates in 10 states and the District of Columbia.

A list of the SunTrust branches to be divested is attached.

On Sept. 25, 2019, a federal district court in North Carolina entered a unique final judgment in a private no-poach class action that approves the parties’ settlement agreement and allows the United States to enforce the injunctive relief and compliance provisions of the settlement agreement. The settlement followed the Justice Department’s successful intervention in the case, which challenged alleged agreements between Duke University (Duke) and the University of North Carolina (UNC) not to compete for each other’s medical faculty.

Under the terms of the settlement, the university is prohibited from entering, maintaining, or enforcing unlawful no-poach agreements for five years. The settlement also requires Duke to implement rigorous notification and compliance measures to preclude its entry into these types of anticompetitive agreements in the future. The court’s order gives the United States the right to enforce the injunctive relief provisions of the settlement.

In the hearing to consider approving the settlement, the presiding federal judge said of the Antitrust Division’s intervention and contribution to the injunctive relief portion of the settlement: “I appreciated [your] arguments at summary judgment and the role that you all played in the injunctive relief. We hadn't really talked about that very much, but it is a substantial benefit here in not just to the Class members, but [also] in making sure that employers are aware of the risks and are likely to communicate that to folks who might not know any antitrust law, but who are making decisions as employers. So it is a pretty important part of the settlement.”

Assistant Attorney General Makan Delrahim applauded the entry of the final judgment. “This settlement is part of a larger effort by the Division to be active in enforcing the antitrust laws against practices that harm the hard-working American worker and educating the public about unlawful no-poach agreements in order to deter such agreements in the first place,” said Assistant Attorney General Delrahim. On Sept. 23, 2019, the Antitrust Division held a public workshop on competition in labor markets to discuss the role of antitrust enforcement in labor markets and promoting robust competition for American workers. The workshop covered a variety of labor competition issues, including, among other things, anticompetitive no-poach agreements.

The case is Seaman v. Duke University and Duke University Health System, Case No. 1:15-cv-000462-CCE-JLW (M.D.N.C.). On June 9, 2015, Dr. Danielle Seaman, an assistant professor at Duke University School of Medicine, filed a class action alleging that Duke and UNC agreed not to permit lateral hiring of faculty between the universities. Her complaint further alleged that the universities’ agreement violates Section 1 of the Sherman Act by eliminating competition for faculty, restricting their mobility, and suppressing their compensation. In 2018, the court certified a class comprised of faculty members with an academic appointment at the Duke or UNC Schools of Medicine.

In March 2019, the Department’s Antitrust Division filed a Statement of Interest in the lawsuit addressing the proper application of the antitrust laws, including the standard for judging the legality of alleged no-poach agreements under the Sherman Act. In April 2019, the litigants announced an agreement to settle the case. In May 2019, the Division took the unprecedented step of intervening successfully in the litigation for the limited purpose of joining the proposed settlement and thereby obtaining the right to enforce any injunctive relief entered by the court against Duke.

Duke is a private research university located in Durham, North Carolina. It has several schools and institutes, including the Duke University School of Medicine.

Dwyon Moore was sentenced to 322 months in prison, followed by five years of supervised release, for the armed robberies of five separate businesses in Cleveland, Ohio. 

“This defendant robbed five area businesses, including four in the span of only six hours, while pointing his gun at employees, patrons and a mother with her young child,” said United States Attorney Justin Herdman. “This sentence of more than 26 years is an important message to our community that those who terrorize our neighbors will be held accountable. We are grateful for the quick action of law enforcement, especially the Cleveland Division of Police officers who apprehended the defendant before he could commit yet another armed robbery that night.”

“Small businesses like restaurants and commercial shops are the backbone of a community, and they deserve to operate without a fear of violence,” said Jonathan McPherson, Special Agent in Charge of ATF’s Columbus Field Division.  “ATF is proud to have such strong collaborative relationships with our partners at the Cleveland Division of Police, the Cuyahoga County Prosecutor’s Office Crime Strategy Unit, the FBI, and the United States Attorney’s Office.  Through all of us working together, we were able to identify and prosecute this individual and remove a violent person from our community.”

According to evidence presented at sentencing, on December 12, 2018, Dwyon Moore (50), of Cleveland, OH, began his crime spree at Wonton Gourmet on Payne Avenue when he used a firearm to rob the restaurant.  Moore approached the counter wearing a dark hooded sweatshirt pulled tightly around his face and pointed a firearm at employees and customers, ordering them to the ground.  After stealing approximately $1,000 from the register, Moore fled on foot.

Continuing on December 14, 2018, at approximately 5:45 PM, Moore used a firearm to rob D.O. Summers Cleaners and Laundry on Carnegie Avenue.  Wearing a dark hooded sweatshirt pulled tightly around his face, Moore pointed a gun at an employee and said “Don’t try to be a hero, ill be back, give me the money.”  Moore then stole from the register, stole a coat from the dry cleaner, and fled on foot. 

Within 45 minutes of the D.O. Summers robbery, Moore robbed Dark and Lovely Hair and Beauty on Cedar Avenue.  Moore, again wearing a dark hooded sweatshirt pulled tightly around his face, pointed a firearm at customers, including a small child and his mother while ordering them to the ground, and demanded money from the register.  Moore stole approximately $21 from a customer and approximately $100 from the register, then fled on foot.

Shortly after the Dark and Lovely robbery, Moore then robbed Bo Loong restaurant on St. Clair Avenue.  While pointing a firearm, Moore told an employee to come to the counter, and demanded for the employee to give him all the money on his person. The employee removed $100 from his pocket and handed the money to the defendant. The defendant instructed the employee to lie down, and the employee complied. Moore stated, “It’s not personal. It’s just business.”  Moore stole $50 from another employee, $250 from other customers, and approximately $350 from the register, then fled on foot.  Moore was wearing the same dark colored hooded sweatshirt as seen in all of the previous robberies. 

Finally, again wearing a dark hooded sweatshirt pulled tightly around his face, Moore robbed the Good Times Café on East 55th Street.  Using a firearm, Moore robbed multiple bar patrons, as well as the Good Times Café register, then fled on foot.  Patrons flagged down Cleveland Police Patrol Officers who quickly apprehended Moore nearby.  Moore attempted to flee and resisted while officers attempted to handcuff him.  CPD officers recovered a large amount of cash, items stolen during the various robberies, drug paraphernalia, and a loaded .38 caliber revolver.  Moore was wearing the same clothing visible on surveillance from the prior four robberies.  All told, Moore robbed four (4) separate businesses in the span of six (6) hours on December 14, 2018, in addition to the robbery he committed on December 12, 2018. 

This case is part of Project Safe Neighborhoods, a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. PSN was reinvigorated in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime

This case was investigated by the Cleveland Division of Police, The Bureau of Alcohol, Tobacco, Firearms and Explosives, the Federal Bureau of Investigation, and the Cuyahoga County Prosecutors Office’s Crime Strategies Unit. It was prosecuted by Assistant U.S. Attorney John C. Hanley.

A federal jury in Fort Lauderdale, Florida, convicted Paul Senat today of aiding and assisting in the preparation of false tax returns and theft of government funds, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.

According to the evidence presented at trial, from at least 2012 to 2016, Paul Senat was the owner and operator of multiple tax return preparation businesses in Palm Beach and surrounding areas. Through the businesses, Senat falsified his clients’ returns by reporting fictitious business losses and false education credits in order to fraudulently inflate their refunds.

Following the jury verdict, Senat was taken into custody. United States District Judge Rodolfo A. Ruiz scheduled sentencing for Jan. 27, 2020. 

Senat faces a statutory maximum sentence of 10 years in prison for theft of government funds and three years for each count of aiding and assisting in the preparation of false returns. He also faces a period of supervised release, restitution, forfeiture, and monetary penalties.

Principal Deputy Assistant Attorney General Zuckerman commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorneys Alexander Effendi and Lauren Archer of the Tax Division, who prosecuted the case.

As we mark Veterans Day 2019, the Justice Department announced two settlement agreements under the Americans with Disabilities Act (ADA) to protect and advance equal access for veterans with disabilities who use service dogs. One agreement is with Deerfield Inn & Suites, in Gadsden, Alabama. The second agreement is with the Landmark Hotel Group in Virginia Beach, Virginia, which manages the Holiday Inn Express in Hampton, Virginia. These matters were investigated and resolved in furtherance of the Department’s commitment to ensuring that our veterans enjoy equal access to public accommodations, such as restaurants, hotels, and shops.

The ADA generally requires public accommodations to provide access to individuals with disabilities who use service animals, including those who use service dogs for post-traumatic stress disorder (PTSD) or anxiety. Yet, in public accommodations across the country, individuals with disabilities are frequently barred from entering with a service animal.

“Individuals with disabilities, including veterans who have sacrificed for our country, have a right under federal law to the equal enjoyment of the services that a public accommodation provides to the public,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “The Civil Rights Division is committed to ensuring equal access for our veterans, and we commend these businesses – the Deerfield Inn & Suites and the Landmark Hotel Group – for acknowledging their obligations under the Americans with Disabilities Act, and agreeing to implement policies and practices to ensure equal access for individuals who use service dogs.”

The Deerfield Inn & Suites agreement resolves allegations that, after driving many hours, a veteran arrived at the Deerfield Inn & Suites at 4:00 in the morning. When the desk clerk learned that the veteran was accompanied by her service dog, the desk clerk refused to honor the reservation, insisting that no dogs were permitted in the hotel. Despite numerous attempts by the veteran to explain that the dog was not a pet, but a highly trained animal required for disabilities she acquired in the service of our country, the clerk would not allow the veteran to stay at the hotel. As a result, and given the late hour, the veteran ended up sleeping in her car in the parking lot of a church.

Similarly, the complaint underlying the Landmark Hotel agreement alleged that, at the Holiday Inn Express managed by the Landmark Hotel Group, the desk clerk refused to honor a reservation by a veteran because he would not provide documentation that the dog with him was a service dog. The veteran informed the clerk that it was unlawful to ask for documents to establish that a dog is a service animal, but the desk clerk informed him that such documentation was corporate policy. The veteran then requested to speak to the hotel manager, who confirmed that it was the hotel’s policy to require such documentary proof. The veteran was forced to find another hotel.

Under the ADA, public accommodations generally must make modifications to their policies, practices or procedures – such as a no-pet policy – to permit the use of a service animal by a person with a disability. A service dog generally may go wherever the public is allowed to go, and a public accommodation may not require documentation about the service dog. 

Under these agreements, both entities will adopt and implement a service dog policy; provide training on the service dog policy to employees and managers; post the service dog policy at their facilities and in their advertising; and pay money damages to the two veterans. All entities cooperated with the Department throughout the investigations.  

People interested in finding out more about the ADA or this settlement agreement can call the toll-free ADA Information Line at 800-514-0301 or 800-514-0383 (TDD), or access the ADA website at http://www.ada.gov.

A federal jury convicted a Cleveland man for attempting to possess and distribute over 600 grams of blue fentanyl pills marked as oxycodone.

Rayshawn D. Ligon, 39, was convicted of conspiracy to possess with intent to distribute fentanyl, two counts of attempt to possess with intent to distribute fentanyl, and escape, following a one-week trial.  The jury found that Ligon intended to distribute blue pills marked to look like 30 milligram oxycodone hydrochloride pills, but were in fact pills laced with fentanyl.  Ligon attempted to receive packages containing the blue fentanyl-laced pills through the U.S. mail.  While Ligon was attempting to receive and distribute the blue fentanyl-laced pills, he was residing in a halfway house as he served the remainder of a 100-month federal sentence for trafficking heroin, cocaine, and cocaine base.  When agents and investigators attempted to apprehend Ligon, he fled and was later apprehended in a neighboring state.

Ligon will be sentenced early next year.  He faces a mandatory minimum sentence of 25 years in prison. 

This case is being prosecuted by Assistant U.S. Attorneys Patrick Burke and Danielle Angeli following an investigation by the Drug Enforcement Administration, U.S. Postal Inspection Service, and U.S. Immigration and Customs Enforcement.

A fugitive and former Hillsboro, Oregon, tax fraud promoter, who had been on the run since he was supposed to start serving a 10 year prison sentence, was caught in Arizona and apprehended on Nov. 1, 2019, by the U.S. Marshals Service, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.

Winston Shrout, 70, was convicted by a jury in April 2017 of submitting fraudulent financial instruments to banks and the U.S. Treasury, and failing to file income tax returns. According to the evidence presented at his trial and sentencing, from approximately 2008 through 2015, Shrout created and submitted more than 300 such fraudulent instruments. He also held seminars and private meetings to promote and market the use of these instruments to pay off debts, including federal taxes. Shrout sold recordings of his seminars, templates for fraudulent financial instruments and other materials through his website.

In addition, Shrout did not file his 2009 through 2014 tax returns despite earning substantial income from seminars, licensing fees associated with the sale of his products, and annual pension payments. Shrout admitted during trial that he had not paid income tax for at least 20 years.

On Oct. 22, 2018, Judge Robert E. Jones sentenced Shrout to 10 years in prison, to serve five years of supervised release, and to pay restitution to the IRS. Shrout failed to report to prison as ordered in March 2019, and was a fugitive until his arrest late last week. Shrout appeared in district court and will be transferred to the custody of the Bureau of Prisons to begin serving his prison term.

Principal Deputy Assistant Attorney General Zuckerman commended the diligent investigation of the U.S. Marshals Service in Portland, Oregon, and Phoenix, Arizona, for bringing Shrout to justice. Principal Deputy Assistant Attorney General Zuckerman also commended special agents of IRS–Criminal Investigation, who conducted the investigation, Trial Attorneys Stuart Wexler and Lee Langston of the Tax Division, who prosecuted the case, the U.S. Attorney’s Office for the District of Oregon, and Assistant United States Attorney Ryan Bounds, for their support during the investigation, prosecution, and apprehension of the defendant in this case.

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

A federal grand jury indicted a Hillsboro Beach, Florida, businessman today for tax evasion, employment tax fraud, and other tax crimes, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.

According to the indictment, Vincent Celentano owned and operated several businesses in Florida and Michigan, including WCIS Media LLC (WCIS), which advertised on behalf of health care providers and solicited accident victims for medical services and personal injury legal services. In 2013, Celentano allegedly used more than $360,000 from his businesses’ bank accounts to pay for personal expenses, including credit card payments and fuel and sundries for his yacht, “Ciao Bella,” and fraudulently caused the expenses to be recorded as business expenditures. That same year, Celentano also allegedly sold ownership interests in entities under his control to a third-party buyer for approximately $2.7 million, but demanded payment of his profits in a way that prevented accountants from accurately reporting income from the sale to the Internal Revenue Service (IRS). As alleged, despite earning gross income in excess of the filing threshold, Celentano willfully failed to file his individual income tax returns from 2013 through 2016.

In addition, the indictment further alleges that from October 2013 to February 2018, Celentano conspired with others to withhold payroll taxes from employees of his business, Integrated HCS Practice Management LLC, but not pay those withholdings to the IRS. The indictment charges that instead, the conspirators used the funds to cover the business’s operating expenses and their personal expenses. When the IRS made efforts to collect the payroll taxes due, Celentano and his coconspirators allegedly thwarted its efforts by using a nominee entity to pay employees, and making fraudulent representations to the IRS about who was responsible for paying the taxes. According to the indictment, Celentano willfully failed to pay over approximately $216,700 in payroll taxes that were owed.

If convicted, Celentano faces a statutory maximum sentence of five years in prison for each tax evasion and conspiracy charge, three years in prison for each count of failure to pay over employment taxes, and a statutory maximum sentence of one year on each count of willful failure to file his own tax returns. The defendant also faces a period of supervised release, restitution and monetary penalties. 

An indictment merely alleges that crimes have been committed. A defendant is presumed innocent until proven guilty beyond a reasonable doubt.

Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS-Criminal Investigation and the Federal Bureau of Investigation, who conducted the investigation, and Trial Attorneys Mark McDonald and Eric C. Schmale of the Tax Division, who are prosecuting the case.

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

SHREVEPORT, La. – United States Attorney David C. Joseph announced today the creation and launch of the Northwest Louisiana Human Trafficking Task Force, which held its first meeting this morning. The task force, formulated and led by the United States Attorney’s Office and Bossier Parish Sheriff’s Office, is a collaboration of federal, state, and local law enforcement agencies and prosecutors, along with local non-governmental victim services organizations, including civic, faith-based, and social services organizations.

Members of the task force will work collectively to identify, investigate and prosecute criminals using a victim-centered approach, provide victims/survivors with assistance, offer training to law enforcement and service providers, and increase public awareness about human trafficking throughout northwest Louisiana.  The task force will be led by the U.S. Attorney’s Office Human Trafficking Coordinator, Assistant U.S. Attorney Earl M. Campbell, and will meet monthly to share information, coordinate investigations, and discuss potential matters and active cases in preparation of prosecution.

The Northwest Louisiana Human Trafficking Task Force consists of representatives from the U.S. Attorney’s Office, Federal Bureau of Investigation (FBI) and its Child Exploitation and Human Trafficking Task Force, Homeland Security Investigations, U.S. Marshal’s Service, U.S. State Department’s Diplomatic Security Service, U.S. Department of Labor, Office of Inspector General, Louisiana Attorney General Jeff Landry, Louisiana Alcohol and Tobacco Control, Louisiana State Police, Bossier/Webster Parish District Attorney’s Office, Caddo Parish District Attorney’s Office, Bossier Parish Sheriff’s Office, Caddo Parish Sheriff’s Office, DeSoto Parish Sheriff’s Office, Webster Parish Sheriff’s Office, Bossier City Marshal’s Office, Bossier City Police Department, and Shreveport Police Department.

Additionally, the task force will work in collaboration with numerous non-governmental victim advocate organizations, such as Purchased: Not for Sale, Caddo Parish Juvenile Services, The Center for Children and Families, Department of Children & Family Services, FREE Coalition, Gingerbread House – Bossier, The Hub, Louisiana Office of Juvenile Justice, United Way of Northwest Louisiana, and Volunteers for Youth Justice CASA Program. Task force meetings tailored for the non-governmental organizations will be hosted quarterly by the U.S. Attorney’s Office. 

“Human trafficking is a crime that involves the systematic abuse of individual rights, freedom, and human dignity,” said U.S. Attorney David C. Joseph. “This task force will coordinate multiple entities and agencies, and help our citizens effectively battle this evil in northwest Louisiana. I want to thank our partners in this effort who have committed their resources to protect victims, prevent human trafficking, and apprehend and prosecute traffickers who exploit their victims for financial gain.” 

“While we live in a good community, we know that this does go on. Most of these victims have no hope or means to get out of these situations,” said Louisiana Sheriff’s Association President, Bossier Parish Sheriff Julian Whittington. “Bossier Parish Sheriff’s Office is proud to be a part of the federal, state and local efforts to combat human trafficking.”

“Investigating human trafficking is a national priority of the FBI and we continue to take a proactive approach to identify human traffickers involved with the exploitation of adults and children alike,” said FBI Special Agent in Charge Bryan Vorndran. “Through this effort we are committed to providing victims the resources they need to improve their situation and continue to bring human traffickers to justice.”

To report suspected human trafficking or to obtain resources for victims, please call the National Human Trafficking Hotline at 1-888-373-7888, text “BeFree” (233733), or live chat at HumanTraffickingHotline.org.  The toll free phone number, SMS text lines, and online chat function are available 24 hours a day, 7 days a week, 365 days a year.  Help is available in English and Spanish, or in more than 200 additional languages.  The National Hotline is not managed by law enforcement, immigration or an investigative agency.  Correspondence with the National Hotline is confidential and you may request assistance or report a tip anonymously.

The National Human Trafficking Hotline connects victims and survivors of sex and labor trafficking with services and support. The National Hotline also receives tips about potential situations of sex and labor trafficking, and will facilitate sharing that information with the Northwest Louisiana Human Trafficking Task Force. Through information received by the National Hotline, law enforcement authorities can connect investigations that span jurisdictions across the country.

To learn more about the National Resource Hotline, visit: www.humantraffickinghotline.org. To learn more about the U.S. Department of Justice’s efforts to combat human trafficking visit: www.justice.gov/humantrafficking.

For more information about the Northwest Louisiana Human Trafficking Task Force, please contact AUSA Earl Campbell or Victim Coordinator Vicki Chance at 318-676-3600.

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A Ravenna, Ohio woman was charged with bank fraud for allegedly embezzling approximately $490,000 from her former employer.  Victoria A. Ladd, age 50, is alleged to have used her employment position, which allowed her access to company funds and bank accounts, to write checks to herself that she then cashed or deposited into her personal bank accounts.  The stolen funds were then allegedly used to pay her personal expenses.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal records, if any, the defendant’s role in the offense and the characteristics of the violation.  In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.

The investigation preceding the indictment was conducted by the FBI.  The case is being prosecuted by Assistant United States Attorney Brendan D. O’Shea.

An information is only a charge 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.

A Maple Heights man pleaded guilty to crimes related to his plot to launch a terrorist attack in Cleveland on Independence Day.

Demetrius Nathaniel Pitts, aka Abdur Raheem Rafeeq, aka Salah ad-Deen Osama Waleed, 50, pleaded guilty to attempting to provide material support to a foreign terrorist organization, threats against the President of the United States and threats against family members of the President of the United States.

Pitts is scheduled to be sentenced on February 11, 2020. Under the terms of his guilty plea, Pitts is likely to be sentenced to 14 years in prison followed by a lifetime of supervised release.

“This defendant admitted to plotting an attack on families and children in downtown Cleveland on Independence Day, as well as making threats against the President and his family,” U.S. Attorney for the Northern District of Ohio Justin Herdman said. “He planned to inflict pain and terror on the day we celebrate our nation’s most cherished freedoms. We remain committed to protecting our nation from people who adhere to ideologies that promulgate violence.”

“Pitts has acknowledged his desire and plan to commit a terrorist attack supporting al-Qaeda in Cleveland during the July 4th parade, the very day innocent citizens would be celebrating the freedoms we have in this country,” FBI Special Agent in Charge Eric B. Smith said. “The FBI thanks the public for reporting individuals espousing their radical beliefs that threaten our way of life.  Law enforcement reminds the public, if you see something, say something, we must interrupt plans for violent attacks before they occur.”

According to an affidavit filed in the case, between 2015 and 2017, Pitts expressed anti-American sentiments and expressed a desire to recruit people to kill Americans.  The defendant expressed a desire to meet with an al Qaeda “brother” and in June he was introduced to an FBI employee acting in an undercover capacity (UCE), who Pitts believed was such a “brother.”

Pitts and the UCE met in Walton Hills, Ohio, in 2018, where they discussed launching an attack for al Qaeda during the July 4th holiday.

Pitts said: “I’m trying to figure out something that would shake them up on the 4th of July.”  He later stated: “What would hit them at their core?  Blow up in the, have a bomb blow up in the 4th of July parade.”

Pitts searched Google for a map of downtown Cleveland.  After learning the fireworks would be launched from Voinovich Park, Pitts said: “Oh there you go. Oh yeah.”  He was also pleased the park was near the U.S. Coast Guard station, the Army Corps of Engineers, and the Celebrezze Federal Building.

The meeting concluded with Pitts indicating to the UCE that he would travel to downtown Cleveland soon to take photographs and videotape footage as part of surveillance efforts of Voinovich Park and the U.S. Coast Guard station.  He also expressed a desire to take a tour of the U.S. Coast Guard station to gain as much information as he could about the layout of the facility.

On June 25, Pitts met with an FBI confidential human source (CHS) in Maple Heights, Ohio, to retrieve items used to conduct surveillance for the July 4th attack.

On June 26, Pitts contacted the UCE via text message and relayed that he had completed the reconnaissance of the designated spots in downtown Cleveland and that he desired to “destroy the government.”

Pitts also indicated he intended to travel to Philadelphia, since Philadelphia is his hometown and he knows it best.  Pitts indicated it was his “job” to “go look at the base of the ground” and that it was up to other “brothers” to complete other parts of the job.

On June 27, Pitts met with the CHS and turned over the phone that contained the reconnaissance photos and videos, so they could be provided to the al Qaeda brothers.

Later on June 27, Pitts and the UCE met in Maple Heights then drove to downtown Cleveland, where they discussed the impending July 4th bombing.

“And I’m gonna be downtown when the – when the thing go off.  I’m gonna be somewhere cuz I wanna see it go off,” Pitts said.

A search of the phone that Pitts provided to the CHS revealed that he made two videos in which he pledged allegiance.  He stated, in part: “We serve Allah . . . We fight our enemies.  We destroy them and destroy those who try to oppose…”

The phone also had four videos taken by Pitts that show him walking down East 9th Street in Cleveland, pointing out potential targets such as the federal building, the Coast Guard station and St. John’s Cathedral, which he said could be taken “off the map.”

On July 1, Pitts met with the UCE in Garfield Heights, Ohio, for Pitts to explain his plan for Philadelphia.  Pitts said he planned to travel there to conduct reconnaissance for a future attack in Philadelphia.  Pitts stated a truck bomb packed with explosives, such as the one used in Oklahoma City, Oklahoma, would be the best way to cause maximum damage.

Pitts was reminded by the UCE that people would die and body parts would by flying around.  Pitts responded “I don’t care” and that he had “no regrets,” would be able to “go to sleep” and “I don’t give a (expletive).”

Pitts also pleaded guilty today to threatening to kill the President of the United States and his immediate family members, namely his daughter and son-in-law.

The FBI-Cleveland Division’s Joint Terrorism Task investigated the case, which is being prosecuted by Assistant U.S. Attorneys Michelle Baeppler and Jerry Teresinski of the Northern District of Ohio, and Trial Attorney Paul Casey of the National Security Division’s Counterterrorism Section.

 

The Justice Department announced today the formation of the new Procurement Collusion Strike Force (PCSF) focusing on deterring, detecting, investigating and prosecuting antitrust crimes, such as bid-rigging conspiracies and related fraudulent schemes, which undermine competition in government procurement, grant and program funding.

At a press conference today at the Department of Justice in Washington, D.C., Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division explained that the PCSF will be an interagency partnership consisting of prosecutors from the Antitrust Division, prosecutors from 13 U.S. Attorneys’ Offices, and investigators from the FBI, the Department of Defense Office of Inspector General, the U.S. Postal Service Office of Inspector General and other partner federal Offices of Inspector General.

Deputy Attorney General Jeffrey A. Rosen expressed the Department’s support for the initiative.  “To protect taxpayer dollars, the Justice Department is doing its part to eliminate anticompetitive collusion, waste and abuse from government procurement,” said Deputy Attorney General Rosen.  “To ensure taxpayers the full benefits of competitive bidding, experienced investigators and prosecutors with the necessary expertise will partner in this Strike Force to deter, detect and prosecute antitrust crimes and related schemes in government procurements.”

“The investigation and prosecution of individuals and organizations that cheat, collude and seek to undermine the integrity of government procurement are priorities for this administration,” said Assistant Attorney General Delrahim.  “The PCSF will train and educate procurement officials nationwide to recognize and report suspicious conduct in procurement, grant and program funding processes. We will aggressively investigate and prosecute those who violate our antitrust laws to cheat the American taxpayer.”

The PCSF will lead a national effort to protect taxpayer-funded projects at the federal, state and local level from antitrust violations and related crimes, starting with a focus on 13 districts throughout the country.  Prosecutors from the Antitrust Division and the participating U.S. Attorneys’ Offices, along with agents from the FBI and partner Offices of Inspector General, will work together to conduct outreach and training for procurement officials and government contractors on antitrust risks in the procurement process.  In addition, the partnered prosecutors and investigators will jointly investigate and prosecute cases that result from their targeted outreach efforts.

“Inspectors General throughout the federal government have a long history of rooting out waste, fraud and abuse in government contracting,” said Michael E. Horowitz, Inspector General of the Department of Justice and Chair of the Council of Inspectors General on Integrity and Efficiency.  “We welcome the opportunity to contribute our expertise to the important work of the Procurement Collusion Strike Force.  We look forward to partnering with the other participating members of the law enforcement community to hold accountable actors who seek to defraud the government and cheat taxpayers.”

“The FBI has a long history of working with our interagency and law enforcement partners to investigate public procurement crimes and ensure justice,” said FBI Criminal Investigative Division Assistant Director Terry Wade.  “We are committed to working closely with our DOJ colleagues and our federal, state and local partners as we continue to successfully combat these crimes.”

“Individuals and companies that participate in procurement collusion cause significant harm and losses to the Department of Defense and to American taxpayers,” said Glenn A. Fine, Principal Deputy Inspector General, Performing the Duties of the Inspector General, of the Department of Defense Office of Inspector General.  “The DoD Office of Inspector General, and our criminal investigative component, the Defense Criminal Investigative Service, are committed to aggressively investigating those individuals and companies who would attempt to compromise government procurement processes.”

The Antitrust Division and its law enforcement partners have a history of prosecuting criminal antitrust conspiracies that take advantage of government contracts.  In late 2018 and early 2019, for instance, five South Korean oil companies agreed to plead guilty for their involvement in a decade-long bid-rigging conspiracy that targeted contracts to supply fuel to U.S. military bases in South Korea.  The Antitrust Division also indicted seven individuals for conspiring to rig bids and to defraud the government, and one executive was also charged with obstruction of justice.  In total, the companies have agreed to pay $156 million in criminal fines and over $205 million in separate civil settlements.  This year, the Justice Department, in partnership with the GSA Office of Inspector General, also indicted individuals for involvement in rigging bids submitted to the GSA.

The PCSF’s 13 U.S. Attorney partners include:

• Nicola T. Hanna, Central District of California
• McGregor Scott, Eastern District of California
• Jason R. Dunn, District of Colorado
• Jessie K. Liu, District of Columbia
• Ariana Fajardo Orshan, Southern District of Florida
• Byung J. “BJay” Pak, Northern District of Georgia
• John R. Lausch, Jr., Northern District of Illinois
• Matthew Schneider, Eastern District of Michigan
• Geoffrey S. Berman, Southern District of New York
• David M. DeVillers, Southern District of Ohio
• William M. McSwain, Eastern District of Pennsylvania
• Erin Nealy Cox, Northern District of Texas
• G. Zachary Terwilliger, Eastern District of Virginia

The PCSF’s investigative partners include:

• Department of Defense Office of Inspector General
• Federal Bureau of Investigation
• General Services Administration Office of Inspector General
• Department of Justice Office of the Inspector General
• U.S. Postal Service Office of Inspector General

The PCSF has launched a publicly available website at https://www.justice.gov/procurement-collusion-strike-force, where government procurement officials and members of the public can review information about the federal antitrust laws and training programs, and report suspected criminal activity affecting public procurement.

Individuals and companies are encouraged to contact the PCSF if they have information concerning anticompetitive conduct involving federal taxpayer dollars by emailing pcsf@usdoj.gov.

Attorney General William Barr, Secretary of Defense Mark Esper, Acting Secretary of Homeland Security Kevin McAleenan, Acting Director of National Intelligence Joseph Maguire, FBI Director Christopher Wray, U.S. Cyber Command Commander and NSA Director Gen. Paul Nakasone, and CISA Director Christopher Krebs today released the following joint statement:

“Today, dozens of states and local jurisdictions are hosting their own elections across the country and, less than a year from now, Americans will go to the polls and cast their votes in the 2020 presidential election. Election security is a top priority for the United States Government. Building on our successful, whole-of-government approach to securing the 2018 elections, we have increased the level of support to state and local election officials in their efforts to protect elections. The federal government is prioritizing the sharing of threat intelligence and providing support and services that improve the security of election infrastructure across the nation.

In an unprecedented level of coordination, the U.S. government is working with all 50 states and U.S. territories, local officials, and private sector partners to identify threats, broadly share information, and protect the democratic process. We remain firm in our commitment to quickly share timely and actionable information, provide support and services, and to defend against any threats to our democracy.

Our adversaries want to undermine our democratic institutions, influence public sentiment and affect government policies. Russia, China, Iran, and other foreign malicious actors all will seek to interfere in the voting process or influence voter perceptions. Adversaries may try to accomplish their goals through a variety of means, including social media campaigns, directing disinformation operations or conducting disruptive or destructive cyber-attacks on state and local infrastructure.

While at this time we have no evidence of a compromise or disruption to election infrastructure that would enable adversaries to prevent voting, change vote counts or disrupt the ability to tally votes, we continue to vigilantly monitor any threats to U.S. elections.

The U.S. government will defend our democracy and maintain transparency with the American public about our efforts. An informed public is a resilient public. Americans should go to trusted sources for election information, such as their state and local election officials. We encourage every American to report any suspicious activity to their local officials, the FBI, or DHS. In past election cycles, reporting by Americans about suspicious activity provided valuable insight which has made our elections more secure. The greatest means to combat these threats is a whole-of-society effort.”

A British man living in Las Vegas, Nevada, pleaded guilty today to a scheme to abuse the personal and financial information of hundreds of thousands of victims in order to steal millions of dollars, the Department of Justice announced today. 

Gareth David Long, 40, pleaded guilty to one count of wire fraud and one count of aggravated identity theft in federal court in Las Vegas before U.S. District Judge Andrew P. Gordon.  The court set Long’s sentencing hearing for Feb. 20, 2020.

“The defendant took millions of dollars from numerous victims by misusing their personal and financial data,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “As demonstrated by this case, the Department of Justice is committed to protecting the public from those who unlawfully use personal and financial data to victimize American consumers.”

“Today’s events serve as another example of the unremitting dedication of the Postal Inspection Service to halt the devastating effects of identity theft.  Those who engage in this type of fraud must learn they cannot escape detection and will be brought to justice,” said Inspector in Charge Delany De Leon-Colon of U.S. Postal Inspection Service’s Criminal Investigations Group at National Headquarters.  “The guilty plea of Gareth Long has brought justice for all who suffered financial and emotional distress because of his actions.”

As part of his plea agreement, Long admitted that he created and deposited checks drawn on the checking accounts of more than 375,000 victims without authorization during a six-month period in 2013.  Although Long had no authorization to charge the victims’ accounts, he represented to victims’ banks that the victims had authorized the debits.  When account holders called to complain about the charges, Long instructed his employees to tell callers that they had authorized the charges in connection with an online payday loan application.  Long used the proceeds of his fraud scheme to purchase a 5,400 square foot ranch and 23 acres of land in Texas, three airplanes, cars, a fire truck, and construction and farm equipment, as well as to pay other personal expenses.

In pleading guilty, Long admitted that, from 2008 through 2013, he operated a third-party payment processing company, V Internet Corp, which also did business as Altcharge and Check Process.  As a payment processor, Long specialized in the creation and deposit of remotely-created checks (“RCCs”).  An RCC is a check created not by the account holder, but by the third-party payee.  In place of a signature, Long’s RCCs contained a typed statement claiming that the check was authorized by the account holder.  Because of this payment processing activity, Long possessed the personal and financial information of hundreds of thousands of consumers whose accounts he debited in 2012 and earlier.  

In January 2013, Long stopped acting as a third-party payment processor for other merchants, and simply started using RCCs to charge the bank accounts of consumers whose personal identifying information he had acquired over the previous five years, as well as other consumers whose information Long purchased in the form of “lead lists.”  Long did not have authorization to charge any of these victims’ accounts.   

From January through July of 2013, Long created and deposited more than 750,000 RCCs totaling more than $22 million.  While approximately half of these RCCs were immediately reversed by victims’ banks, Long nevertheless succeeded in stealing approximately $11 million over a six-month period.

The U.S. Postal Inspection Service seized more than $2.9 million from Long’s company bank accounts.  Postal Inspectors also seized property that Long purchased with the proceeds of his fraudulent activity, including three airplanes and the other vehicles and property described above.  In addition, as part of his plea agreement, Long will forfeit the ranch and land he purchased in Texas.

The Department of Justice’s case is being handled by Trial Attorneys John W. Burke and Ehren Reynolds of the Consumer Protection Branch in coordination with the U.S. Attorney’s Office for the District of Nevada and with substantial investigative support from the U.S. Postal Inspection Service.

A City of Cleveland employee was sentenced to 18 months in prison for extortion, bribery, and other crimes after he accepted below-market improvements on his property from a city contractor he supervised and directed city projects to benefit himself.  He was also ordered to pay restitution to the City of Cleveland and the Internal Revenue Service.

Khalil Ewais, 44, previously pleaded guilty to Hobbs Act extortion, receipt of a bribe, federal program theft, making false statements and filing false tax returns.

Ewais worked in the Mayor’s Office of Capital Projects (“MOCAP”) as the construction Section Chief in the Engineering and Construction division. In that capacity, he oversaw construction inspectors who inspect work on the city’s roads, bridges and sidewalks. He had a fiduciary duty to act in the best interests of the city and its citizens.

Ewais also owned and operated Pioneer Engineering, a private engineering and consulting business that did work for private clients. He also, along with his brother and other family members, owned commercial and residential rental properties in and around Cleveland.

Company 1 bid on jobs with the City of Cleveland. In April 2015, it was awarded a contract to perform most of the resurfacing of residential streets in certain wards of Cleveland for two years. Company 1 bid approximately $5.8 million for the work.

Ewais, in his job with the city, had input into whether Company 1 received additional contracts from the city. Company 1 could not receive payment for the work it did until Ewais certified it was done appropriately. He could also direct Company 1 to complete “corrective work” which would cost the company additional time and money.

In August 2016, Ewais contacted multiple companies, including Company 1, about paving the parking lot adjacent to Captain’s Grill, a property at 6104 Storer Ave. that he and his brother owned. Quotes for the work ranged from $48,923 to $59,152. Another contractor that Ewais supervised as part of the residential streets project declined to bid.

Ewais contacted an owner of Company 1 on August 10, 2016, about the estimate for the parking lot and said “I need it to be in the $25K range.” The owner quickly responded, “I will do the job for a lump sum of $26,000.”

Even though the parking lot work was a private job for Ewais, he sent an email form his City email address to another City official regarding the sewer connection at the border of Ewais’s property and West 61st Street, and stated that “E&C [MOCAP’s Division of Engineering & Construction] directed the roadway work and the connection fix in the street as part of the E&C Requirement Contract.”  In fact, no City agency had directed any roadway work on West 61st Street at that time, and the work was related to Ewais’s private construction project.

Ewais also used his official position to cause the city to pay to repave most of the short public alleyway next to the parking lot, West 62nd Place. Around Oct. 25, 2016, Company 1— at the direction of Ewais — instructed a subcontractor to expand the scope of its work on the parking lot job to include milling and paving the part of West 62nd Place that adjoined the parking lot, but not the short additional distance to reach the home at the end of the alleyway.

In causing the city to pay for repaving most of West 62nd Place, Ewais avoided the established process for selecting streets to be resurfaced. The city, through a contractor, had sought to rate the condition of all the streets in Cleveland leading up to the 2016 resurfacing program. The city’s pavement management group, which included Ewais, met to discuss the lowest-rated streets in each ward to recommend to the City Council members which streets to include as part of the resurfacing program. The list of streets to be resurfaced never included West 62nd Place, which never even received a rating in the evaluation process.

Ewais, without the necessary approvals and authorizations, created a task order to have West 62nd Place, the small alleyway next to the Captain’s Grill parking lot, resurfaced.  As a result of Ewais’s actions, the City of Cleveland paid a total for $10,938 to have West 62nd Place resurfaced.

The parking lot work was completed on Nov. 5, 2016, with the parking lot connected to West 62nd Place. Company 1 spent approximately $81,534 to complete the work. Ewais paid $31,336 for the work and Company 1 did not request any further payment.

In December 2017, Ewais lied to federal agents when he was questioned about the repaving of West 62nd Place, falsely claiming that a Cleveland City Councilperson had selected West 62nd Place to be repaved. 

Ewais also filed false tax returns in which he failed to report all of his income from his rental properties.

This case was investigated by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigations, the U.S. Department of Housing and Urban Development – Office of Inspector General and the Cleveland Division of Police. It was prosecuted by Assistant U.S. Attorneys Chelsea S. Rice and Elliot Morrison.

The Department of Justice today announced awards of more than $165 million to support public safety efforts in the state of North Carolina. The funding from the Office of Community Oriented Policing Services (COPS), Office of Justice Programs (OJP), and Office on Violence Against Women (OVW) will support violent crime reduction, opioid/substance abuse reduction efforts, school safety, victim services, transitional housing for domestic violence victims, law enforcement activities, justice mental health, and juvenile justice.

“The Department of Justice is very pleased to provide these critical public safety resources not only to local law enforcement agencies throughout North Carolina, but also to state-level agencies for the benefit of all North Carolinians,” said Director Phil Keith of the Office of Community Oriented Policing Services.  “This funding will secure schools and protect kids from crime and violence across the state, and help to combat the scourge of deadly drugs running rampant in our communities.”

“Helping to protect North Carolinians — and all Americans — is job number one for the Department of Justice and the Office of Justice Programs,” said Principal Deputy Assistant Attorney General Katharine T. Sullivan of the Office of Justice Programs.  “I’m proud to make these resources available to the brave crime-fighters, compassionate service providers and dedicated criminal and juvenile justice professionals who work so hard, day in and day out, to safeguard the communities of this great state.”

Director Phil Keith made the announcement in Raleigh on Friday morning along with Governor Roy Cooper, U.S. Attorney Robert J. Higdon Jr. for the Eastern District of North Carolina, U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina, and North Carolina State Bureau of Investigation (SBI) Director Bob Schurmeier.  The North Carolina Department of Public Safety received approximately $2.9 million from the COPS Office for investigating illicit activities related to heroin distribution and methamphetamine trafficking, and the North Carolina Department of Public Instruction (DPI) was the only state-level agency to receive funding to improve school security through the 2019 COPS School Violence Prevention Program.  Additional school safety funding was provided to both the North Carolina SBI and DPI through OJP’s Bureau of Justice Assistance for behavioral threat assessments and the enhancement of the North Carolina State School Safety Center.

“North Carolina law enforcement will be better able to keep our communities safe and stop drug traffickers with this vital funding,” said Governor Roy Cooper. “Federal support for local expertise is the right way to fight the opioid epidemic and to protect our schools. These grants will go a long way in making sure North Carolinians live in safe communities.”

“Supporting law enforcement at every level and all across the State of North Carolina goes to the heart of the mission of the U.S. Department of Justice,” said U.S. Attorney Robert J. Higdon Jr.  "And these grants provide much needed resources and funding to law enforcement agencies as they work to protect our communities from violence, drug trafficking and any others who threaten our safety and security.”

“The grants announced today by the U.S. Department of Justice represent a significant investment in support of law enforcement and public safety in North Carolina,” said U.S. Attorney Matt Martin.  “We are particularly pleased that grants in the Middle District will support school safety programs, the fight against opioid addiction, and the coordinated efforts under way to reduce gun violence from Durham to Winston-Salem and Rockingham County to Cabarrus County.  These are critical priorities of all three U.S. Attorneys; to borrow an apt adage: we are putting our money where our mouth is.”

“These grants will allow SBI agents across North Carolina to more effectively partner with our police departments and sheriff’s offices to continue the fight against the opioid epidemic,” said SBI Director Bob Schurmeier.  “Families in our state have suffered enormous pain and loss and we grieve with them.  We will use these resources to go after the cartels, traffickers and dealers and bring them to justice.  We are grateful to the COPS Office and the US Department of Justice for their support of North Carolina and the State Bureau of Investigation.”

A full list of COPS awards is available online at https://cops.usdoj.gov/grants. OJP awards, organized under specific grant programs, are available online at https://ojp.gov/funding/Explore/OJPAwardData.htm. For OVW awards, visit https://www.justice.gov/ovw/awards.

About the Office of Community Oriented Policing Services:

The COPS Office is a federal agency responsible for advancing community policing nationwide. Since 1994, the COPS Office has invested more than $14 billion to advance community policing, including grants awarded to more than 13,000 state, local and tribal law enforcement agencies to fund the hiring and redeployment of approximately 130,000 officers and provide a variety of knowledge resource products including publications, training and technical assistance. For additional information about the COPS Office, please visit www.cops.usdoj.gov.

About the Office of Justice Programs:

The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Katharine T. Sullivan, provides federal leadership, grants, training, technical assistance and other resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal and juvenile justice systems. More information about OJP and its components can be found at www.ojp.gov.

About the Office on Violence Against Women:

The Office on Violence Against Women provides leadership in developing the nation’s capacity to reduce violence through the implementation of the Violence Against Women Act and subsequent legislation. Created in 1995, OVW administers financial and technical assistance to communities across the country that are developing programs, policies and practices aimed at ending domestic violence, dating violence, sexual assault and stalking. In addition to overseeing federal grant programs, OVW undertakes initiatives in response to special needs identified by communities facing acute challenges. Learn more at www.justice.gov/ovw.

Earlier today, extensive coordination and cooperation efforts between United States and Brazilian law enforcement authorities culminated in the Brazil Federal Police (DPF) conducting a significant enforcement operation to disrupt and dismantle a transnational alien smuggling organization, including the arrest on Brazilian charges of an alleged alien smuggler who has also been indicted in the United States.  The alien smugglers targeted in this operation are alleged to be responsible for the illicit smuggling of scores of individuals from South Asia and elsewhere, into Brazil, and ultimately to the United States.

Saifullah Al-Mamun aka Saiful Al-Mamun, 32, was arrested in Brazil.  Al-Mamun is charged in a superseding indictment unsealed today in the U.S. District Court for the Southern District of Texas – Laredo Division, charging him with eight conspiracy and alien smuggling counts.  The enforcement operation included the execution of multiple search warrants and the additional arrests of seven Brazil-based human smugglers on Brazilian charges: Saifullah Al-Mamun, 32; Saiful Islam, 32; Tamoor Khalid, 31; Nazrul Islam, 41; Mohammad Ifran Chaudhary, 39; Mohammad Nizam Uddin, 28; and Md Bulbul Hossain, 36.

According to the indictment, Al-Mamun is alleged to have housed the aliens in São Paulo, Brazil and arranged for their travel through a network of smugglers operating out of Brazil, Peru, Ecuador, Colombia, Panama, Costa Rica, Nicaragua, Honduras, Guatemala, and Mexico to the United States. In return for smuggling the aliens into the United States, Al-Mumun and his two co-conspirators, are alleged to have arranged to be paid in Mexico, Central America, South America, Bangladesh, and elsewhere.

“Today’s indictment shows our commitment to prosecute here in the United States those alien smugglers who put our country’s public safety at risk by attempting to thwart our system of legal immigration,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.  “We will continue to collaborate with our foreign law enforcement partners to hold international human smugglers accountable for the threat they pose to the national security of Brazil, the United States, and other nations.”

“Transnational human smuggling organizations threaten the security of the United States,” said Special Agent in Charge Scott Brown of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Phoenix.  “Through a significant joint effort with our domestic and international law enforcement partners, these arrests signify another victory as we continue to investigate and dismantle those who conspire to undermine our nation’s immigration laws for their own profit.”

Milon Miah, a Bangladeshi national who was residing in Tapachula, Mexico, was arrested Aug. 31 on arrival at George Bush Intercontinental Airport in Houston, Texas, to face charges in the superseding indictment for his role in the scheme to smuggle aliens into the United States.  Moktar Hossain, 31, a Bangladeshi national formerly residing in Monterrey, Mexico, pleaded guilty on Aug. 27 for his role in the scheme to smuggle aliens to the United States for the purpose of commercial advantage or private financial gain.

Both the indictment against Al-Mamun and assistance provided by U.S. authorities to Brazilian law enforcement were coordinated under the Extraterritorial Criminal Travel Strike Force (ECT) program, a joint partnership between the Justice Department Criminal Division’s Human Rights and Special Prosecutions Section (HRSP) and HSI.  The ECT program focuses on human smuggling networks that may present particular national security or public safety risks, or present grave humanitarian concerns. ECT has dedicated investigative, intelligence and prosecutorial resources.  ECT coordinates and receives assistance from other U.S. government agencies and foreign law enforcement authorities.  HSI Phoenix led U.S. investigative efforts, working in concert with HSI Brasilia, HSI Laredo, the HSI Human Smuggling Unit ECT program, ICE’s Enforcement and Removal Operations, U.S. Customs and Border Protection National Targeting Center, the International Organized Crime Intelligence and Operations Center, the HSI Liaison to the U.S. Department of Defense, U.S. Southern Command, Operation CITADEL, BITMAP, and the National Targeting Center. The Justice Department, both Criminal Division’s HRSP and the Office of International Affairs, provided significant assistance in this matter.

Trial Attorneys James Hepburn, Erin Cox, and Mona Sahaf of the Criminal Division’s Human Rights and Special Prosecutions Section are handling the U.S. investigation, with assistance from the U.S. Attorney’s Office for the Southern District of Texas.

The charges contained in the Al-Mamun indictment are merely allegations and the defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

A homebuilder and the owner of Tarryall River Log Homes was sentenced to 60 months in prison yesterday for tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.

According to court documents and evidence presented during the trial, Lawrence Martin Birk founded a sole proprietorship, Tarryall River Log Homes LLC, in 2000. Although the company, which sold and built log homes, was profitable, Birk did not voluntarily pay federal taxes on its income. When the Internal Revenue Service (IRS) began collection efforts, including visiting Birk at his home, he hired a tax firm to prepare eight years’ worth of delinquent tax returns. However, Birk concealed pertinent information from the tax firm, including over $400,000 of retirement distributions that he funneled through a sham company. After filing his delinquent tax returns, which omitted the retirement income, Birk still did not pay what the returns acknowledged was due and owing. Instead, he sent the IRS threatening correspondence that espoused the frivolous tax arguments of known tax defier organizations.

After being notified that the IRS intended to seize money from his bank accounts for taxes owed, Birk took steps to shield his money against the IRS’ collection efforts. Immediately or shortly after depositing funds into his bank account, Birk purchased cashier’s checks to reduce his balance and impede the IRS’s ability to seize the money. Birk’s outstanding tax liabilities, including taxes, interest, and penalties, were over $2 million for 1998 to 2005. He has not filed returns or made any tax payments for the 2006 through 2018 tax years. To date, his debt is more than $3.5 million. 

In addition to the term of imprisonment, Judge Blackburn also ordered Birk to serve three years of supervised release and to pay restitution to the IRS in the amount of $1,858,826.

Principal Deputy Assistant Attorney General Zuckerman commended the IRS agents who conducted the investigation, and Tax Division Assistant Chief Elizabeth C. Hadden, Trial Attorney Christopher Magnani, and Paralegal Specialist Saundra Burgess, who prosecuted the case.

A Texas man pleaded guilty today to defrauding victims around the United States by selling them fake “standby letters of credit” and other forged and fraudulent bank documents.     

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Assistant Director in Charge Timothy R. Slater of the FBI’s Washington Field Office made the announcement.

James Pierce, 43, of Spring, Texas, pleaded guilty to a three-count indictment charging him with wire fraud and conspiracy to commit wire fraud before Chief Judge Beryl A. Howell of the District of Columbia.  Sentencing is scheduled for Jan. 10, 2020, before Judge Howell.

As part of his guilty plea, Pierce admitted that he and his co-conspirators falsely represented to their victims that they had a relationship with a bank located in the Dominican Republic (“Bank 1”), that they could use to secure financing for the victims’ large commercial transactions. In exchange for six-figure fees paid by the victims, the defendant and his co-conspirators falsely promised that the victims could gain access to credit at Bank 1.  They further represented that Bank 1 would issue Society for Worldwide Interbank Financial Telecommunication (SWIFT) inter-bank messages to banks designated by the victims, showing that the victims had access to such credit.  In reality, the defendant and his co-conspirators had no such relationship with Bank 1, and provided the victims with fake Bank 1 documentation falsely showing that it had transmitted the promised bank instruments.  When the victims did not receive their SWIFT messages, the defendant and his co-conspirators gave the victims excuses and false statements, and in several instances, fraudulently induced the victims to pay additional money to have their bank documentation “re-issued” – which also never happened.  Pierce also used a website and email address at jpierceinvestments.com to carry out the fraud.

The FBI investigated the case.  Trial Attorney Blake Goebel and Assistant Chief Justin Weitz of the Criminal Division’s Fraud Section are prosecuting the case. 

Individuals who believe that they may be a victim in this case should visit the Fraud Section’s Victim Witness website for more information.

BIRMINGHAM, Ala. – A federal judge yesterday sentenced a Shelby County man on a charge of failure to register as a sex offender, announced Northern District of Alabama United States Attorney Jay E.  Town and United States Marshal Martin Keely.

United States District Judge Abdul K. Kallon sentenced RICKY DION ODOM, 47, of Shelby County, to 24 months incarceration for failure to register as a sex offender to run consecutive to Odom’s probation revocation in Louisiana.  Odom pled guilty in July 2019. 

“Failure to register as a sex offender is not only a matter of public safety, but it is our primary mechanism by which every member of the community can learn of sex offenders living among us.,” Town said.   “Sex offenders who flee to another state, and violate the law by not registering will be caught, will be prosecuted, and will face incarceration.  My office will continue to put the safety of children at the forefront, now more than ever.”

According to court documents, Odom is required to register under the Sex Offender Registration and Notification Act (SORNA).  On or about November 1, 2018 and continuing until on or about February 4, 2019, Odom traveled from the State of Louisiana to the State of Alabama and knowingly failed to register as required by SORNA.

In addition to the term of imprisonment imposed, Odom was ordered to serve five years of supervised release.

United States Marshal Service for the Northern District of Alabama, Middle District of Alabama, Eastern District of Louisiana, Northern District of Florida, and Gulf Coast Regional Fugitive Task Force investigated the case along with the assistance of St. Tammany Parish (LA) Sheriff’s Office, Okaloosa County (FL) Sheriff’s Office, Jackson County (AL) Sheriff’s Office, Shelby County (AL) Sheriff’s Office, and the Alabama Department of Conservation and Natural Resources, which Assistant United States Attorney R. Leann White prosecuted. 

 

ContextMedia Health LLC, which operates under the trade name Outcome Health (Outcome), a digital provider of medical information and advertising in doctors’ offices, has agreed to a resolution with the Department of Justice by which it will pay $70 million to victims of a fraud scheme that targeted its clients, lenders and investors.

Outcome, a privately held company headquartered in Chicago, Illinois, admitted in resolution documents that from 2012 to 2017, former executives and employees of the company perpetrated a scheme to defraud its clients—most of which were pharmaceutical companies—by selling advertising inventory that it did not have. 

“Outcome Health deceived its lenders and investors, and overbilled its clients, by fraudulently misrepresenting both the quality and quantity of its advertising services and concealing those misrepresentations from auditors,” said Principal Deputy Assistant Attorney General John P. Cronan.  “Today’s resolution demonstrates the Criminal Division’s unyielding commitment to making whole victims of fraud.”

“Outcome’s payment of $70 million is an appropriate resolution for the corporate entity given the misconduct of executives and employees acting on its behalf,” said Assistant U.S. Attorney Brian Hayes, Chief of the Criminal Division for the Northern District of Illinois.  “This resolution demonstrates that there are significant consequences for businesses whose executives and employees engage in fraud.”           

“For five years, employees of Outcome Health purposely failed to deliver on advertising campaigns and engaged in a pattern of misrepresentations to conceal their fraud,” said Special Agent in Charge Emmerson Buie Jr. of the FBI’s Chicago Field Office.  “This resolution demonstrates the FBI’s commitment to working with its prosecutorial and investigative partners to ensure that justice is done.”

“Today’s agreement holds a healthcare technology company accountable for systematically committing fraudulent business practices for financial gain over many years,” said Inspector General Jay N. Lerner of the Federal Deposit Insurance Corporation’s Office of Inspector General (FDIC-OIG).  “The FDIC-OIG is committed to investigating such corporate corruption which harms lending institutions, investors, customers, and competitors.  We remain dedicated to working with our law enforcement partners to investigate those who commit such misconduct.”

Outcome admitted that as a result of its practice of selling clients inventory it did not have, it under-delivered on its advertising campaigns.  Despite these under-deliveries, the company still invoiced its clients as if it had delivered in full.  To conceal the under-deliveries, Outcome employees at the time falsified affidavits and proofs of performance to make it appear the company was delivering advertising content to the number of screens in its clients’ contracts.  Outcome executives and employees during that time also inflated patient engagement metrics regarding how frequently patients engaged with Outcome’s devices.  Furthermore, an executive at the time altered a number of studies presented to clients to make it appear that the campaigns were more effective than they actually were, Outcome admitted.

Outcome further admitted that its under-delivery on advertising campaigns resulted in a material overstatement of its revenue for the years 2015 and 2016.  The company’s outside auditor signed off on the 2015 and 2016 revenue numbers because executives and employees at the time fabricated data to conceal the under-deliveries from the auditor.  Outcome used the inflated revenue figures in its 2015 and 2016 audited financial statements to raise $110 million in debt financing in April 2016, $375 million in debt financing in December 2016, and $487.5 million in equity financing in early 2017, it admitted.

The Department and Outcome entered into a non-prosecution agreement (NPA) to resolve this matter.  Outcome’s obligations under the agreement will have a term of three years, unless the term is modified by the government.  Under the terms of the NPA, Outcome and its current parent company, Outcome Health LLC (Outcome Parent), committed to compensating the pharmaceutical client victims in the amount of $70 million, approximately $65.5 million of which has already been made through a combination of cash payments and in-kind services, and to set aside an additional $4.5 million to compensate any additional pharmaceutical clients who have not yet been made whole.  The NPA does not require Outcome and Outcome Parent to provide compensation to lenders and investors who were victims of Outcome’s scheme, however, because many of those lenders and investors are now the companies’ new owners.  Under the terms of the NPA, Outcome and Outcome Parent also agreed to cooperate with the government’s ongoing investigation of individuals, to report evidence or allegations of U.S. federal law to the Department, and to enhance their existing compliance program and internal controls, where necessary and appropriate, to ensure they are designed to detect and deter violations of U.S. federal law. 

The Department reached this resolution based on a number of factors, including Outcome and Outcome Parent’s ongoing cooperation with the United States and for taking extensive remedial measures.  For example, Outcome no longer employs the executives or employees who were involved in the wrongdoing, and Outcome and Outcome Parent made significant improvements to address and improve the reliability of reporting on advertising campaign delivery, including hiring third parties to audit all of their advertising campaigns.

The FBI and FDIC-OIG are investigating the case.  Assistant Chief William E. Johnston and Trial Attorney Kyle C. Hankey of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Matthew F. Madden of the Northern District of Illinois are prosecuting the case.

The Department of Justice announced today that it will require Symrise AG to divest its chicken-based food ingredient manufacturing facility in Banks County, Georgia, in order to proceed with its proposed $900 million acquisition of International Dehydrated Foods LLC (IDF) and American Dehydrated Foods LLC (ADF) from IDF Holdco Inc. and ADF Holdco Inc.

The Justice Department’s Antitrust Division filed a civil antitrust lawsuit in the U.S. District Court for the District of Columbia to block the proposed merger.  At the same time, the Division filed a proposed settlement that, if approved by the court, would resolve the Department’s competitive concerns.

“This structural solution ensures that American consumers will continue to benefit from vigorous competition for a critical input used in everyday consumer staples like chicken soup, chicken broth and pet food,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division.  “Today’s settlement fully preserves competition in the sale of chicken-based food ingredients.”

According to the complaint, without the divestiture, the combined company would control over 75 percent of the domestic market for the manufacture and sale of chicken-based food ingredients.  These ingredients are derived from chicken and sold to food manufacturers for use in a variety of human and pet food products.  Without the required divestiture, the combined company likely would have been able to increase prices, reduce service and quality, and diminish innovation in the market for chicken-based food ingredients.

The divestiture required under the settlement would, if approved by the court, require Symrise to sell its brand-new facility in Banks County, Georgia, to Kerry Inc. or an alternate acquirer approved by the United States.  Kerry is a global manufacturer of ingredients and recipe solutions for the food and beverage industry.  This divestiture ensures that the buyer of the Banks County facility will be well positioned to compete vigorously with the merged company in the manufacture and sale of chicken-based food ingredients in the United States.

Symrise AG is a publicly listed company headquartered in Holzminden, Germany, with diversified operations in multiple lines of business.  It manufactures and sells chicken-based food ingredients through its Diana Food and Diana Pet Food subsidiaries.  In 2018, Symrise reported total revenue of approximately $3.5 billion.

IDF and ADF are privately held companies headquartered in Springfield, Missouri, whose operations include two chicken-based food ingredient plants in Alabama and Missouri.  The companies’ combined 2018 revenue for chicken-based food ingredients used in human and pet food manufacturing was approximately $177 million.

As required by the Tunney Act, the proposed settlement and the Department’s competitive impact statement will be published in the Federal Register. Any person may submit written comments by mail concerning the proposed settlement within 60 days of its publication to Robert Lepore, Acting Chief, Transportation, Energy and Agriculture Section, Antitrust Division, U.S. Department of Justice, 450 Fifth St. N.W., Suite 8000, Washington DC 20530, telephone: 202-307-6349.  At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.

A Texas entrepreneur was sentenced to 36 months in prison today for fraudulently soliciting hundreds of thousands of dollars in political contributions through several scam-PACs that he founded and advertised as supporting candidates for the Office of the President of the United States during the 2016 election cycle. 

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Agent in Charge Christopher H. Combs of the FBI’s San Antonio Division made the announcement.

Kyle Gerald Prall, 40, of Austin, Texas, previously pleaded guilty to one count of mail fraud before U.S. Magistrate Judge Andrew W. Austin of the Western District of Texas.  He was sentenced today by U.S. District Court Judge Robert Pitman.  In addition to the prison sentence, Prall was ordered to pay $548,428 in restitution and to forfeit $205,496.68 in proceeds obtained from his offense.

According to admissions made in connection with his plea, in 2015 and 2016, Prall created several political committees—including Feel Bern, HC4President and Trump Victory—which he advertised online to solicit contributions purportedly in support of presidential candidates in the 2016 election.  Prall advertised that the contributions would be used to support the candidates in various ways, including paying for transportation for voters to the polls; paying for training for volunteers to make phone calls and canvass neighborhoods to support the respective candidates; paying to help voters obtain appropriate identification documents; and making contributions directly to one of the candidates and to other organizations supporting his campaign.  In reality, Prall did not intend to, and did not, use the contributions for these purposes and instead transferred much of the money to himself through sham LLC accounts and used the other funds to generate additional contributions to his fraudulent political committees.  Specifically, Prall admitted that of the $548,428 in contributions, he transferred $205,496 to himself through sham LLCs that he created for the purpose of moving the money, while contributing less than $5,100 to political causes.  Additionally, Prall used the political committees’ debit cards to pay for his personal travel and entertainment expenses, such as travel to Jacksonville, Florida, and Belize; hotel stays in Miami Beach, Florida, and Austin, Texas; and to pay for food, Hookah, alcohol and bottle service, “club dances performed by entertainers,” room service, minibar charges, a deep-tissue massage, and a pet-cleaning fee.

The FBI’s San Antonio Division is investigating the case.  Deputy Chief John D. Keller and Trial Attorney James C. Mann of the Criminal Division’s Public Integrity Section are prosecuting the case. 

The owner of a Greenville, Ohio, glass company was sentenced to 14 months in prison today for failing to truthfully account for and pay over employment taxes, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.

According to information and documents provided to the court, Gail Cooper, 64, of Greenville, was the owner of Greenville Architectural Glass (GAG), which primarily installed glass in commercial and residential buildings for clients in Ohio. GAG paid wages to its employees during the years 2013 through 2015, and as the person responsible for GAG’s finances, Cooper was required to withhold federal income taxes and Social Security and Medicare taxes from the employees’ wages and pay those amounts over to the Internal Revenue Service (IRS). Cooper was also required to file quarterly employment tax returns with the IRS. Although Cooper caused GAG to withhold taxes from employees’ wages, she neither filed the required quarterly returns for the first quarter of 2013 through the second quarter of 2015, nor paid the withheld amounts over to the IRS. Cooper also failed to pay over to the IRS unemployment taxes. In all, Cooper caused more than $280,000 in payroll taxes not to be paid.

Cooper also filed false individual income tax returns for 2008, 2009, and 2010, on which she understated GAG’s gross receipts and overstated its expenses. Cooper caused GAG’s bookkeeper to manipulate and delete entries in the company’s accounting records. Specifically, she directed the bookkeeper to delete invoices from the software after GAG received payment from a client to make it appear as if GAG had not received the payment. Cooper also paid personal expenses with business funds, including utility bills for her residence and rental properties, and caused these to be classified as business expenses. After filing fraudulent returns for 2008-2010, Cooper did not file any individual income tax returns for the next several years. In total, Cooper’s conduct caused a tax loss of $587,516 to the United States.

In addition to the term of imprisonment, U.S. District Judge Thomas M. Rose ordered Cooper to serve two years of supervised release and pay restitution to the IRS in the amount of $659,262.39.

Principal Deputy Assistant Attorney General Zuckerman thanked special agents of IRS Criminal Investigation, who investigated the case, and Trial Attorneys Melissa S. Siskind and Thomas F. Koelbl of the Tax Division, who are prosecuting the case. Principal Deputy Assistant Attorney General Zuckerman also thanked the U.S. Attorney’s Office for the Southern District of Ohio for their assistance in this matter.

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

 

          Two former owners and an employee of an ambulance services provider headquartered in Guam pleaded guilty yesterday for their roles in a health care fraud and money laundering scheme that resulted in a loss to the United States of approximately $10.8 million.  This is one of the largest single Medicare ambulance fraud cases prosecuted nationwide.

          Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Shawn N. Anderson of the Districts of Guam and the Northern Mariana Islands, Special Agent in Charge Eli S. Miranda of the FBI’s Honolulu Field Office, Special Agent in Charge Justin Campbell of IRS Criminal Investigation’s (IRS-CI) Seattle Field Office and Special Agent in Charge Timothy DeFrancesca of the U.S. Department of Health and Human Services Office of the Inspector General’s (HHS-OIG) Los Angeles Regional Office made the announcement.

          Clifford P. Shoemake, 63, of Guam, Casey C. Conner, 60, of Saipan, and Nicholas A. Shoemake, 31, of Guam, the former owners and an employee, respectively, of Guam Medical Transport (GMT), pleaded guilty before U.S. District Judge Frances Tydingco-Gatewood of the District of Guam, to one count of conspiracy to commit health care fraud and one count of conspiracy to engage in monetary transactions with the proceeds of specified unlawful activity.  The defendants are scheduled to be sentenced on Jan. 29, 2020.

          Medicare and TRICARE are federal health benefit programs, which, under certain conditions, reimburse providers for medically necessary, non-emergency, scheduled ambulance transportation to and from dialysis treatments, provided to beneficiaries with end stage renal disease (ESRD).  Ambulance services are medically necessary when provided to such beneficiaries who cannot be transported by any other means without endangering their health, or were bed confined before, during and after the transportation.

          According to their admissions at the plea hearing, from approximately March 11, 2010, to approximately March 21, 2014, the defendants engaged in a conspiracy to defraud Medicare and TRICARE by submitting claims for reimbursement for medically unnecessary ambulance services that GMT provided to patients with ESRD.  The defendants admitted they were aware that GMT was transporting patients who did not qualify for ambulance transportation under applicable Medicare and TRICARE regulations and guidelines, with which they had failed to familiarize themselves.  Specifically, the defendants admitted they were aware that many of GMT’s patients were not bed-confined, and did not have acute medical conditions that would otherwise qualify them for ambulance transportation.  As part of the scheme, the defendants directed GMT employees to remove from internal documents references to GMT patients’ ability to walk because they knew that Medicare and TRICARE would not provide reimbursement for the patients.  The defendants further admitted they were aware of, but failed to address, concerns about GMT’s Medicare and TRICARE billing practices raised by other GMT employees.  The conspiracy resulted in improper payments to GMT of approximately $10.8 million, the defendants admitted.

          The defendants further admitted to conspiring to engage in money transactions involving the proceeds of their health care fraud scheme.  Specifically, they admitted that they used the proceeds of their health care fraud scheme to pay for personal expenses, such as vacations, personal income taxes, a personal residence and other items.  They then caused these expenses to be falsely categorized as business expenses of GMT, thereby improperly reducing GMT’s taxable income and GMT’s corresponding tax liability, they admitted.

          To date, five former GMT owners and employees have pleaded guilty to their roles in defrauding Medicare and TRICARE in this scheme.  One additional former employee pleaded guilty to obstructing justice by falsifying materials that GMT prepared in response to an HHS subpoena that was served on GMT in approximately September 2012.

          The FBI, IRS-CI and HHS-OIG investigated the case.  Senior Litigation Counsel John A. Michelich and Trial Attorney Michael P. McCarthy of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Marivic P. David of the Districts of Guam and the Northern Mariana Islands prosecuted the case.