District Not Recorded

An indictment was unsealed today against an alleged member of the Philadelphia, Pennsylvania organized crime family of La Cosa Nostra (LCN) and his alleged associate.  The indictment charges various crimes involving the making of extortionate loans, conspiracy, and collections of loans by extortionate means. 

The charges were announced today by Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney William M. McSwain for the Eastern District of Pennsylvania and Special Agent in Charge Michael Harpster of the FBI’s Philadelphia Field Division.

The defendants charged in the 15-count indictment are Philadelphia LCN Family member Philip Narducci, 56, and his associate James Gallo, 44.

All of the defendants were arrested today and will make initial court appearances in U.S. District Court in Philadelphia at 1:30 pm. EST. 

According to the indictment, Narducci allegedly made usurious and extortionate loans involving large amounts of money to a borrower.  As set forth in the indictment, when the borrower failed to make weekly interest payments, Narducci allegedly used physical violence through assault and threats of violence to force the borrower to repay the loans.  The indictment also alleges that, at Narducci’s direction, Gallo collected weekly interest payments on the usurious loans from the borrower and used threats of violence to facilitate the collections. 

Each charge of making extortionate extortions of credit, conspiracy to collect extensions of credit by extortionate means, and collections of extensions of credit by extortionate means making extortionate extensions of credit, carries a maximum penalty of 20 years in prison and a $250,000 fine. 

The case is being prosecuted by Trial Attorney John S. Han of the Criminal Division’s Organized Crime and Gang Section. 

The case is being investigated by the FBI, the Pennsylvania State Police, and the Pennsylvania Office of the Attorney General.

An indictment is merely an accusation and each defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law. 

A Los Angeles, California-based dentist pleaded guilty on Thursday to a March 2018 indictment charging him with health care fraud arising from his false and fraudulent billings for crowns and fillings, which were never provided to patients. 

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Nicola T. Hanna of the Central District of California, Assistant Director in Charge Nancy McNamara of the FBI’s Washington, D.C. Field Office and Assistant Director in Charge Paul D. Delacourt of the FBI’s Los Angeles Field Office made the announcement.

Benjamin Rosenberg, D.D.S., 58, of Los Angeles, pleaded guilty to one count of health care fraud before U.S. District Judge John A. Kronstadt of the Central District of California.  Sentencing will take place on May 23 before Judge Kronstadt.

As part of his guilty plea, Rosenberg admitted that he submitted and caused to be submitted approximately $3,853,931 in false and fraudulent claims to various insurance companies for dental care that Rosenberg knew had not been rendered.  Rosenberg further admitted that he submitted these false and fraudulent claims to Metlife, Anthem, Cigna, Delta Dental, Guardian, LMCO-DHA, United Health, and United Concordia (the “carriers”), which caused the carriers to pay Rosenberg approximately $1,415,011.

This case was investigated by the FBI.  Trial Attorney Emily Z. Culbertson of the Criminal Division’s Fraud Section is prosecuting the case. 

The Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and the U.S. Department of Health and Human Services (HHS) to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  Since its inception in 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

The Justice Department today reached a settlement agreement with Selma Medical Associates Inc. (Selma Medical), a privately owned medical facility located in Winchester, Virginia, that provides primary and specialty care to patients.

The settlement agreement resolves a complaint under Title III of the Americans with Disabilities Act (ADA) that Selma Medical refused to accept a prospective new patient for an appointment because he takes Suboxone, a medication used to treat opioid use disorder. The Justice Department’s investigation concluded that Selma Medical regularly turned away prospective new patients who lawfully take controlled substances to treat their medical conditions.

Under the agreement, Selma Medical will not deny services on the basis of disability, including opioid use disorder, or apply standards or criteria that screen out individuals with disabilities. The agreement also requires Selma Medical to adopt non-discrimination policies, train staff on its non-discrimination obligations, and report on compliance. Selma Medical will also pay $30,000 in damages to the complainant and a $10,000 civil penalty to the United States.

“This agreement ensures that people in recovery from an opioid use disorder do not face discriminatory barriers to health care services,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “Unlawfully denying services to individuals with disabilities because of their medical conditions subjects these individuals to unwarranted stigma and harm, and will not be tolerated by the Department of Justice.”

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.

ALBANY – The man charged with holding up an Albany bank at gunpoint has been denied bond today by a Federal Magistrate Judge, said Charles “Charlie” Peeler, the United States Attorney for the Middle District of Georgia. Shataz Hampton, 25, of Albany is charged with one count of Bank Robbery and one count of Possession of a Firearm, along with co-defendant Kamilyah Whitlock, 25, of Albany. The two defendants are charged in the armed robbery of the Renasant Bank at 721 N. Westover Blvd., Albany, GA on November 6, 2017.  The Honorable Thomas Langstaff, U.S. District Magistrate Court, detained Mr. Hampton on January 30, 2019 until trial. No date has been set.

“I am pleased the Court granted our motion to detain Mr. Hampton, a man alleged to have brandished a gun and robbed a bank in broad daylight, with innocent customers and employees inside,” said Charles “Charlie” Peeler, the U.S. Attorney for the Middle District of Georgia. “Rest assured, we will prosecute those accused of violent acts to the fullest extent of the law, and we will continue to vigorously seek the highest level of punishment for people who commit the most egregious crimes.”

The case was investigated by the Albany Police Department and the FBI. Assistant U.S. Attorney Leah McEwen is prosecuting the case for the Government.

Questions can be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603 or Melissa Hodges, Public Affairs Director (Contractor), United States Attorney’s Office, at (478) 765-2362.

In December 2018, President Trump proclaimed January 2019 as National Slavery and Human Trafficking Prevention Month, dedicating the month to raising national awareness of the issue of human trafficking and highlighting efforts to combat this violent crime. Over the last year, the Department of Justice fought human trafficking through investigating and prosecuting traffickers, dismantling transnational human trafficking networks, enhancing victim identification and protection of all victims of trafficking, and funding and providing domestic and international anti-trafficking programs.

"Human trafficking is a horrific crime against the human dignity of the victims, and it can have no place in our society," Acting Attorney General Matthew G. Whitaker said. "But the Department of Justice is taking action against the traffickers. In fiscal year 2018, the Department of Justice secured over 500 human trafficking convictions – an increase from the previous fiscal year. We also filed a record number of new cases. And in districts where our new Anti-Trafficking Coordination Teams are in place, we have ramped up the number of trafficking prosecutions. We have sent a clear message to traffickers that the Department of Justice will bring the full force of the law against them."

Investigating and Prosecuting Human Traffickers

In fiscal year 2018, the Justice Department initiated a total of 230 human trafficking prosecutions, charging 386 defendants and convicting a record 526 defendants. The Department continued its successful Anti-Trafficking Coordination Team (ACTeam) Initiative, working with partners in the Department of Homeland Security and the Department of Labor. In 2018, ACTeams saw significant prosecution results, including increases of 10 percent, 75 percent, and 106 percent, in cases filed, defendants charged, and defendants convicted.

Successful cases under ACTeam leadership include one of the largest sex trafficking prosecutions in U.S. history, in which the Justice Department convicted 36 defendants operating a sex trafficking scheme that exploited hundreds of Thai women in multiple states. Additionally, five members of a notorious international criminal organization, known as the Rendon-Reyes Sex Trafficking Organization, were sentenced to prison terms of 15 to 25 years. Prosecution resulted in dismantling of this organization, which forced young women and girls from Mexico and Central America into prostitution for over a decade.

Also in fiscal year 2018, the FBI initiated 649 human trafficking cases and arrested 2453 subjects. The FBI’s efforts contributed to 410 human trafficking convictions and 422 sentencings in this same period.

The Department’s Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute child sex traffickers and other individuals who sexually exploit children, as well as to identify and rescue victims. This collaborative effort yields powerful results, including, for example, five indictments and three superseding indictments charging a total of 19 defendants with sex trafficking offenses against children in the Southern District of New York. 

Dismantling Transnational Human Trafficking Networks

The Department of Justice continues to lead the U.S. Mexico Bilateral Human Trafficking Enforcement Initiative in collaboration with DHS and Mexican law enforcement counterparts to combat human trafficking networks operating across the U.S.-Mexico border.  The initiative has resulted in successful prosecutions in both Mexico and the United States, including U.S. federal prosecutions of over 170 defendants. The collaborative work of the initiative has enabled high-impact prosecutions have dismantled transnational trafficking networks through coordinated, bilateral enforcement actions to simultaneously apprehend associated traffickers in both the U.S. and Mexico.

The Justice Department also continues to target all individuals who contribute to sex trafficking, including online advertisers that facilitate the offense, such as Backpage.com. On April 5, 2018, several Backpage-related corporate entities, including Backpage.com, and Backpage’s co-founder and CEO Carl Ferrer pleaded guilty to federal charges and state charges in California and Texas for conspiring to facilitate prostitution and money laundering.  On April 6, 2018, DOJ seized and shutdown Backpage.com in the U.S. and the 90+ other countries in which it operated.

Enhancing Human Trafficking Victim Identification and Protection

The Department of Justice continues to offer help to and pursue justice on behalf of the victims of this heinous crime. The FBI’s Victim Services Division deploys 183 Victim Specialists who provide direct assistance to federal victims of crime to include human trafficking victims. Victim Specialists provide hundreds of presentations a year educating thousands of participants on trafficking.

In fiscal year 2018, the Justice Department provided extensive training on best practices when investigating child sex trafficking cases. In January 2018, the Project Safe Childhood Investigating and Prosecuting the Prostitution of Children Seminar was held at the National Advocacy Center.  The Department also sponsored the 2018 National Law Enforcement Training on Child Exploitation, held in Atlanta and attended by approximately 1,500 federal, state, local, and tribal personnel.

In 2018, the Executive Office for U.S. Attorneys (EOUSA), the Civil Rights Division’s Human Trafficking Prosecution Unit (HTPU), and the Child Exploitation and Obscenity Section (CEOS) published a quick reference guide entitled “Restitution for Human Trafficking Victims,” which will assist federal prosecutors in obtaining restitution for human trafficking victims. EOUSA also developed a “Toolkit” which provides information on practices, procedures, models, and forms employed in various U.S. Attorneys’ Offices that are helpful to establishing a pretrial coordination practice of obtaining restitution for victims.

As National Slavery and Human Trafficking Month draws to a close, the Department of Justice is committed to continuing its efforts to combat the heinous crime of human trafficking in 2019.

ALBUQUERQUE – Thomas Abeyta, 35, of Alamo, N.M., made an initial appearance in federal court today on charges of aggravated sexual abuse in Indian Country. 

            According to a criminal complaint, Abeyta physically assaulted the victim at a residence on January 25, 2019.  Abeyta injected the victim with a substance and sexually abused her over the course of several hours.  The victim later went to the hospital for treatment of her injuries.  Hospital staff reported the matter to law enforcement.  Investigators have not confirmed the nature of the substance Abeyta injected into the victim.

            If convicted, Abeyta faces up to life in prison.  Charges in criminal complaints are merely accusations.  Defendants are presumed innocent unless found guilty in a court of law.

            The Albuquerque office of the FBI investigated this case with assistance from the Navajo Nation Police Department.  Assistant U.S. Attorney Frederick Mendenhall is prosecuting the case.          

An Alexandria, Virginia man was sentenced on Jan. 11 to five years in prison for receipt of child pornography, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney G. Zachary Terwilliger for the Eastern District of Virginia and Assistant Director in Charge Nancy McNamara of the FBI’s Washington Field Office. 

On Oct. 5, 2018, Kerry Sipult, 51, pleaded guilty to one count of receipt of child pornography.  He was sentenced by Senior District Judge Claude M. Hilton to serve 60 months in prison followed by five years of supervised release.  According to the Information to which Sipult pleaded guilty and to other facts he admitted to in his plea agreement, between Aug. 1, 2014 and Oct. 22, 2014, Sipult used a peer to peer program to download and share child pornography.  As part of the investigation, the FBI seized Sipult’s computer and other electronic storage devices and recovered over 4,000 child pornography images and/or videos. 

The investigation was conducted by the FBI.  Trial Attorney Ralph Paradiso of the Criminal Division’s Child Exploitation and Obscenity Section and Assistant U.S. Attorney Whitney Russell of the Eastern District of Virginia prosecuted the case.

A Texas man was sentenced on Jan. 9 to 420 months in prison, to be followed by a lifetime of supervised release, for producing child pornography in 2016 and committing a sex-related felony involving a minor while being required to register as a sex offender, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and U.S. Attorney John C. Milhiser of the Central District of Illinois. 

Mark P. Barnwell, 36, of Whitehouse, Texas, pleaded guilty before U.S. District Court Judge Joe Billy McDade of the Central District of Illinois on Aug. 29, 2018, to one count of producing child pornography and one count of committing a sex-related felony involving a minor while being required to register as a sex offender.

According to admissions made in connection with his guilty plea, Barnwell, at the time a registered sex offender, exploited minors online through the use of false personas on Facebook. Barnwell controlled multiple female-presenting profiles on Facebook.  Using these profiles, Barnwell contacted female Facebook profile users and advertised a modeling opportunity he claimed would pay up to thousands of dollars per photo shoot.

At Barnwell’s urging, the minors that accepted the offer then took and sent to him photographs that they believed were being produced for the purposes of a modeling portfolio. The minor victims believed they would be paid by cash, check, or direct deposit once they completed the modeling portfolio process. At Barnwell’s explicit direction, the photographs taken by the minors progressed from various stages of undress to sexually suggestive and/or sexually explicit photographs of themselves. 

Once he obtained compromising images, Barnwell threatened to injure the minor victims’ reputations and embarrass them by posting their nude pictures online if they failed to comply with demands for additional images.  In total, Barnwell used this scheme to obtain nude photographs from 43 minor victims located in nine judicial districts across eight states.

In addition to the material, including videos and images, relating to sexual exploitation of children discovered on Barnwell’s devices, law enforcement authorities also found multiple videos captured by Barnwell, including several where he filmed up women’s skirts in public or attempted to do so.  Authorities additionally discovered a large number of videos where Barnwell surreptitiously filmed women using public bathrooms.  The authorities also discovered what is believed to be the hidden camera he used to capture the videos.

The charges are the result of a joint investigation by the U.S. Secret Service, the Peoria Police Department, and the Peoria County Sheriff’s Office.  Vital assistance was provided by the U.S. Attorneys’ offices for the Central District of California, Southern District of Mississippi, District of Nevada, Eastern District of Texas, Northern District of Texas, Western District of Washington, Northern District of Iowa, and Southern District of West Virginia.  This case is being prosecuted by Assistant U.S. Attorneys Ronald Hanna and Katherine Legge of the Central District of Illinois and Trial Attorney William Grady of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS). 

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice.  Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims.  For more information about Project Safe Childhood, please visit www.justice.gov/psc.

Jose Rivera, 59, former Branch Manager of TERMINIX INTERNATIONAL USVI LLC (TERMINIX USVI), was sentenced on Jan. 17, 2019, to 12 months in prison for illegally applying fumigants containing methyl bromide in multiple residential locations in the U.S. Virgin Islands, the Department of Justice and the Environmental Protection Agency (EPA) announced today.  Two of the applications were at the Sirenusa condominium resort complex on St. John where a family of four fell seriously ill in March 2015, after the unit below them was fumigated.  In September 2018, Rivera pleaded guilty to four-count of the counts charged in an indictment charging violations of the Federal Insecticide, Fungicide and Rodenticide Act (FIFRA) for application of a restricted-use pesticide in a manner inconsistent with its label.

According to the plea agreement, Rivera was certified as a pesticide applicator by the Virgin Islands Department of Planning and Natural Resources and received pesticide applicator training from the University of the Virgin Islands.  Based on his training, Rivera knew that he was required to read the pesticide label and follow all instructions when using any pesticide.  In short, the defendant was instructed that federal law requires applicators to follow the pesticide use instructions on the label. The label on methyl bromide states that its use is restricted to the location and manner on the label, and the label does not authorize application of methyl bromide in a residential unit.  Rivera applied methyl bromide, a registered restricted-use pesticide, in a manner inconsistent with the use instructions on the label at the residences named in the counts of conviction.

In November, 2017, the companies TERMINIX LP and TERMINIX, USVI, Rivera’s employer, were sentenced for violations of FIFRA, based on their earlier guilty pleas.  Terminix USVI, was sentenced to pay $4.6 million in fines and $1.2 million in restitution to the EPA for response and clean-up costs at the St. John resort. Terminix International Company LP was sentenced to pay a fine of $4.6 million and will perform community service related to training commercial pesticide applicators in fumigation practices and a separate health services training program.

In 1984, the EPA banned the indoor use of methyl bromide products. The few remaining uses are severely restricted and largely limited to commodity applications for quarantine and pre-shipment purposes. Pesticides containing methyl bromide in the U.S. are restricted-use due to their acute toxicity, meaning that they may only be applied by a certified applicator. Health effects of acute exposure to methyl bromide are serious and include central nervous system and respiratory system damage. Pesticides can be very toxic and it is critically important that they be used only as approved by EPA.

The case was investigated by EPA Criminal Investigation Division working cooperatively with the Virgins Islands government and, the Agency for Toxic Substances and Disease Registry.

Senior Litigation Counsel Howard P. Stewart of the Department of Justice, Environmental Crimes Section, and Assistant U.S. Attorney Kim L. Chisholm of the District of the Virgin Islands are prosecuting the case with assistance of Patricia C. Hick, EPA Region II Regional Criminal Enforcement Counsel.

Brett Palkowitsch, 31, an officer with the St. Paul Police Department, was indicted on Jan. 16 by a federal grand jury in Minneapolis for using excessive force against an arrestee, announced Assistant Attorney General Eric Dreiband of the Department of Justice’s Civil Rights Division and FBI Minneapolis Special Agent in Charge Jill Sanborn.

Today’s indictment charges Palkowitsch with a single count of deprivation of rights under color of law, in violation of 18 U.S.C. § 242.  The indictment alleges that Palkowitsch used unreasonable force when he kicked arrestee F.B. repeatedly while F.B. was on the ground and in the grips of a police canine, resulting in bodily injury.

The indictment carries a maximum penalty of 10 years of imprisonment and a $250,000 fine.  An indictment is merely an accusation and the defendant is presumed innocent unless proven guilty.

This case was investigated by the Minneapolis Division of the FBI, and is being prosecuted by Trial Attorneys Christopher J. Perras and Zachary Dembo of the Justice Department’s Civil Rights Division.

A clinic owner and operator was sentenced to 360 months in prison on Jan. 24  for her role in a scheme to defraud Medicare out of payments for medical services.  Ann Shepherd was convicted at trial in the Southern District of Texas along with her co-defendants, Dr. John Ramirez and Yvette Nwoko. 

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Ryan Patrick of the Southern District of Texas, Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office, Special Agent in Charge C.J. Porter of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Dallas Region, and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU) made the announcement.

Ann Nwoko Shepherd, 62, of Houston, Texas was sentenced by U.S. District Judge David Hittner of the Southern District of Texas.  Judge Hittner also ordered the defendant to pay $20.928 million in restitution and to forfeit $250,000.

According to evidence presented at trial, from in or around December 2011 to in or around August 2015, John Ramirez, M.D., a physician, Ann Shepherd and Yvette Nwoko conspired and schemed to defraud Medicare out of payments for medical services.  Shepherd owned and operated Southwest Total Medical Inc., a purported medical clinic doing business as Amex Medical Clinic in Houston.  Shepherd, along with Yvette Nwoko sold medical orders and other documents signed by Dr. Ramirez to home-health agencies in and around Houston.  Dr. Ramirez falsely certified in these medical orders information about the patient’s medical condition and need for medical services.  Co-conspirators at home-health agencies then used the false and fraudulent paperwork signed by Dr. Ramirez and sold by Ann Shepherd and Yvette Nwoko to bill to, and receive payment from, Medicare for medical services that were not medically necessary or not provided. 

Ann Shepherd also caused Amex Medical Clinic to bill Medicare for purported physician services that were actually provided by an unlicensed practitioner, if at all.

 In all, Ann Shepherd caused Medicare to pay approximately $20 million on false and fraudulent claims submitted during the charged conspiracy.

Dr. John Ramirez is expected to be sentenced on Jan. 29 and Yvette Nwoko is expected to be sentenced on April 18, before the Honorable David Hittner.

This case was investigated by the FBI, HHS-OIG and the Texas Attorney General’s MFCU.  Trial Attorney Scott Armstrong of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Tina Ansari of the Southern District of Texas are prosecuting the case. 

The Criminal Division’s Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in March 2007, the Medicare Fraud Strike Force, , which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

A federal jury found a South Florida pharmacist guilty of health care fraud for his role in a massive compounding pharmacy fraud scheme, which impacted private insurance companies, Medicare and TRICARE. 

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, Special Agent in Charge George Piro of the FBI’s Miami Field Office and Special Agent in Charge Shimon Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.

After a four-day trial, Ademola O. Adebayo, 55, of Odessa, FL, was convicted on Jan. 10 of one count of conspiracy to commit health care fraud and wire fraud, three counts of health care fraud, and one count of conspiracy to commit money laundering.  Sentencing has been scheduled for March 19, 2019 before U.S. District Judge Moreno of the Southern District of Florida, who presided over the trial.

According to evidence presented at trial, from 2012 to 2015, Adebayo and his co-conspirators engaged in a scheme to defraud private insurance companies, Medicare, and TRICARE by submitting false and fraudulent claims for compounded drugs, primarily pain and scar creams, and other prescription medications that were not medically necessary, never provided, or both.  The evidence established that in his role as the pharmacist at A to Z Pharmacy, a now-defunct pharmacy located in New Port Richey, Florida, Adebayo conspired to submit or cause the submission of claims that often amounted to several thousands of dollars for a single tube of pain or scar cream.  In 2014, when insurance companies discovered the fraud at A to Z Pharmacy and terminated their contracts with the pharmacy, Adebayo agreed to become the straw owner of Havana Pharmacy & Discount in Miami, which Adebayo and his co-conspirators used to continue the fraud, the evidence showed. 

The evidence further established that Adebayo personally benefited from the fraud and received $1.5 million, which he used to purchase luxury vehicles, including a Ferrari, a Lamborghini, a Bentley, a Porsche and two Cadillacs, as well as a house in Land O Lakes, Florida, many of which were seized by the government.

Eight other defendants have pleaded guilty in this case.  Nicholas Borgesano, 46, of New Port Richey, Florida, was sentenced to 15 years in prison for his role as the owner of A to Z Pharmacy and participation in fraud schemes that involved Havana Pharmacy, Medplus/New Life Pharmacy and Metropolitan Pharmacy, all of Miami; and Jaimy Pharmacy and Prestige Pharmacy, both of Hialeah, Florida.

In addition to Borgesano, the following defendants have previously been sentenced for their roles in the scheme:

• Scott P. Piccininni, 50, of Fort Lauderdale, Florida, sentenced to 51 months in prison;
• Bradley Sirkin, 56, of Boca Raton, Florida, sentenced to 46 months in prison;
• Peter B. Williams, 58, of New Port Richey, sentenced to 26 months in prison, to be served consecutively to a 60-month sentence of imprisonment he is serving as a result of his guilty plea to a separate indictment returned in the Southern District of Florida; and
• Wayne M. Kreisberg, 41, of Parkland, Florida, placed on probation for a term of five years, to be served consecutively to a sentence of probation he is serving as a result of his guilty plea to a separate indictment returned in the Middle District of Florida.

This case was investigated by the FBI with support from HHS-OIG and DCIS and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.  The case was prosecuted by Trial Attorneys Timothy P. Loper and Aleza Remis of the Fraud Section. 

The Criminal Division’s Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

On January 10, 2019, James R. Casey of Poquoson, Virginia, was sentenced by U.S. District Judge Raymond A. Jackson, in Norfolk, Virginia, to 45 months in prison and a $15,000 fine for his role in conspiring to falsely label millions of dollars’ worth of foreign crab meat as “Product of USA.”

A significant decline in Atlantic blue crab (Callinectes sapidus) harvests that began in 2010 made it increasingly expensive to purchase live Atlantic blue crab and increasingly difficult to profit from the labor-intensive process of picking meat from live-harvested blue crab. According to papers filed in federal court, Casey admitted that, because of this decline, he and his company could not and did not process sufficient quantities of Atlantic blue crab to meet customer demands. To make up the shortfall, Casey and his co-conspirators used foreign crab meat to fulfill customer orders. During the periods when the company did not process blue crab—which sometimes lasted three months—the co-conspirators purchased crab meat (not live crabs) from Indonesia, China, Thailand, Vietnam, and other foreign locales.

The crab meat from Indonesia, China, Thailand, and Vietnam included meat from Portunus pelagicus, Portunus haanii, and Ovalipes punctatus, which are all Indo-West Pacific species of crab that do not live in the continental waters of the United States. The company also purchased crab meat (not live crabs) from Central American sources, which did include Atlantic blue crab, Callinectes sapidus, but also included other species such as Callinectes bocourti, Callinectes bellicosis, Callinectes toxotes, and Callinectes arcuatus.

In his plea agreement, Casey—who was the owner and President of Casey’s Seafood Inc., a wholesale processor of crab meat and other seafood—admitted to substituting foreign crab meat for domestically harvested blue crab. Videos, which were recorded by Casey’s Seafood’s security camera, and which were filed with the court, show company employees removing foreign crab meat from cans and plastic bags, and repackaging the crab meat into plastic containers labeled “Product of USA.” In the filed papers, Casey admitted to directing his employees to substitute and falsely label more than 183 tons of foreign crab meat, which was then sold to grocery stores and independent retailers.

According to the documents filed with the court, Casey further admitted that part of the conspiracy was to purchase discounted foreign crab meat, some of which was referred to as “distressed” because it was approaching or beyond its posted “best used by” dates. Casey admitted to directing company employees to “re-condition” the “distressed” crab meat by re-pasteurizing it, and then packaging the “re-conditioned” meat into the company’s cups, which were labeled and sold as blue crab and “Product of USA.” Casey also directed employees to place labels with “Product of USA” on containers that concealed labels marked as “Product of China” and “Product of Brazil.”

This case was part of an ongoing effort by the Department of Commerce’s National Oceanic and Atmospheric Administration Office of Law Enforcement, in coordination with the Food and Drug Administration, Department of Homeland Security, the Virginia Marine Police, and the Department of Justice to detect, deter, and prosecute those engaged in the false labeling of crab meat. This prosecution is being handled by the Justice Department’s Environmental Crimes Section and the U.S. Attorney’s Office for the Eastern District of Virginia. The government is represented by Assistant United States Attorney Eric Hurt and Trial Attorney Gary N. Donner.

Under a settlement reached with the U.S. Department of Justice’s Environment and Natural Resources Division and the U.S. Environmental Protection Agency, P.H. Glatfelter Company will pay $20.5 million for reimbursement of EPA past costs and natural resource damages and then reimburse all future government costs of overseeing one of the nation’s largest Superfund cleanup projects at Wisconsin’s Lower Fox River and Green Bay Site.  Glatfelter also is agreeing to take on responsibility for long-term monitoring and maintenance activities required by EPA.  Georgia-Pacific Consumer Products LP is joining this settlement and agreeing to minor adjustments to its commitments under prior settlements.

An enormous amount of cleanup and natural resource restoration work has already been done in Fox River and Green Bay under a set of partial settlements, an EPA administrative cleanup order, and court orders in a federal lawsuit brought by the United States and the State of Wisconsin.  The total cleanup costs for the Fox River Site will exceed $1 billion.  The cleanup work will reduce the risks to humans and wildlife posed by polychlorinated biphenyls (PCBs) in bottom sediment of the Fox River and Green Bay.

The cleanup remedy for the Fox River Site was jointly-selected by EPA and the Wisconsin Department of Natural Resources.  The remedy will remove much of the PCB-containing sediment from the Fox River by dredging.  In other portions of the River, contaminated sediment is being contained in place with specially-engineered caps.  The dredging and capping will reduce PCB exposure and greatly diminish downstream migration of PCBs to Green Bay. 

In 2010, the United States and Wisconsin sued NCR Corporation, Glatfelter, Georgia-Pacific and other parties in a Superfund lawsuit to require them to continue the ongoing cleanup at the Site and pay government costs and natural resource damages.  The defendants in the government’s lawsuit included paper companies like Glatfelter and Georgia-Pacific that contaminated the sediment when they made and recycled a particular type of PCB-containing “carbonless” copy paper.  NCR and its affiliates produced that paper with PCBs from the mid-1950s until 1971. 

Under another settlement reached in 2017, NCR agreed to complete all remaining dredging and capping work at the Site.  Today’s settlement requires Glatfelter and Georgia-Pacific to take responsibility for long-term tasks that will continue for many years after the dredging and cap installation is completed in 2019, including periodic monitoring of PCB levels in water and fish and maintenance of the sediment containment caps.  This new settlement expands the companies’ obligations under earlier partial settlements and government orders, which already required at least $66 million in expenditures by Glatfelter and at least $154 million by Georgia-Pacific.

The proposed settlement is in the form of a consent decree that must be approved by the federal judge overseeing the legal proceedings over the Fox River Site.  If approved, this settlement would end all Superfund litigation over the Site. 

This settlement, lodged with the U.S. District Court for the Eastern District of Wisconsin on Jan. 3, 2019, will be subject to a 30-day public comment period after notice of the settlement is published in the Federal Register.  To view the consent decree or to submit a comment, visit the department’s website: www.justice.gov/enrd/Consent_Decrees.html.

For more information on cleanup activities at the Lower Fox River and Green Bay Superfund Site, go to the Environmental Protection Agency’s website: 

https://cumulis.epa.gov/supercpad/cursites/csitinfo.cfm?id=0507723

On Jan. 18, defendant Daniel Stephen Johnson, 40, of Coos Bay, Oregon, was sentenced to life in federal prison for repeatedly sexually abusing children who lived at an orphanage he operated in Cambodia.

The sentencing was announced by Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and U.S. Attorney Billy J. Williams for the District of Oregon.

In a jury trial ending on May 16, 2018, Johnson was convicted on six counts of engaging in illicit sexual conduct in a foreign place and one count each of travel with intent to engage in illicit sexual conduct and aggravated sexual assault with a child. He was sentenced to 30 years in prison on each count of illicit sexual conduct in a foreign place, 30 years for traveling with the intent to engage in illicit sexual conduct, and life in prison for aggravated sexual assault with children. The sentences for engaging in illicit sexual conduct in a foreign place will run consecutively.

According to court documents and information shared during trial, between November 2005 and his arrest in December 2013, Johnson systematically and repeatedly molested children who lived at an unlicensed orphanage he started and ran in Phnom Penh, Cambodia. Johnson funded the orphanage by soliciting donations from church groups in Oregon, California, Texas and elsewhere. Ten Cambodian victims—who ranged in age from seven to 18 years old at the time of abuse—have disclosed Johnson’s abuse or attempted abuse.

Victims described a pattern of molestation that includes, among other things, Johnson making them perform oral sex on him and anally raping them.  Multiple victims said they were, on numerous occasions, awoken to Johnson abusing them. Following the abuse, Johnson would sometimes provide his impoverished victims with small amounts of money or food. On one occasion, Johnson gave a victim the equivalent of $2.50 in Cambodian currency.

In 2013, a warrant was issued for Johnson’s arrest on an unrelated case by officials in Lincoln County, Oregon. Local law enforcement officers worked with the FBI to locate Johnson overseas.  The FBI in turn worked with the U.S. Department of State to revoke Johnson’s passport based on the Oregon warrant.  Through the work of the FBI, Action Pour Les Enfants, a non-governmental organization dedicated to ending child sexual abuse and exploitation in Cambodia, and the Cambodian National Police (CNP), Johnson was located in Phnom Penh.

On Dec. 9, 2013, CNP arrested Johnson.  Based on disclosures made by children at the orphanage, Cambodian officials charged Johnson and detained him pending trial.  In May 2014, Johnson was convicted by a Cambodian judge of performing indecent acts on one or more children at the orphanage and sentenced to a year in prison. Following his release from prison, Johnson was escorted back to the United States by the FBI.

Based on the sexual-abuse allegations against him, the FBI undertook a lengthy investigation of Johnson.  During the course of their investigation, agents interviewed more than a dozen children and adults who had resided at the orphanage.  Many of the interviews were audio- and video-taped and, in several instances, conducted in Cambodia by trained child-forensic interviewers. Some victims were interviewed multiple times before disclosing Johnson’s abuse.

Johnson was indicted by a federal grand jury in Eugene, Oregon on Dec. 20, 2014 on one count of engaging in illicit sexual conduct in a foreign place. Seven additional charges were added by superseding indictment on May 17, 2017.

While in custody awaiting trial, Johnson made multiple efforts to tamper with witnesses and obstruct justice.  Johnson contacted his victims online, encouraging them to lie and offering money and gifts.  One message, sent via his relative’s Facebook account to an adult in Cambodia, discussed visiting a victim’s family and encouraging them to convince the victim to retract their statement, potentially in exchange for $10,000.  Another message explains the need for a victim to say they were under duress and “pushed by police” to thumbprint a document.

This case was investigated by the FBI with the assistance of the Toledo, Oregon, Police Department. It was prosecuted by Trial Attorney Lauren E. Britsch of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorneys Jeffrey S. Sweet and Ravi Sinha of the District of Oregon and Assistant U.S. Attorney Amy E. Potter assisted with the prosecution.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse. Launched in May 2006 by the U.S. Department of Justice and led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

Omega Protein Corp. and Omega Protein, Inc. (collectively “Omega”) have agreed to pay $1 million to resolve allegations that Omega obtained a loan from the United States by falsely certifying compliance with federal environmental laws, the Department of Justice announced today. The matter was unsealed on Jan. 17, 2019. 

Omega is based in Houston, Texas, and is a leading domestic producer of Omega-3 rich fish oil, protein-rich specialty fishmeal, and organic fish solubles for livestock and aquaculture feed manufacturers. 

“This settlement demonstrates our continuing vigilance in protecting the integrity of federal programs and taxpayer dollars,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “Companies will face appropriate consequences if they misrepresent their eligibility to participate in federal programs and divert resources from those who should receive federal support.”

“Businessmen and companies that lie to get their hands on taxpayer money will be held accountable for their actions,” said U.S. Attorney David C. Joseph.  “When some people cheat, those who play by the rules are put at a disadvantage.  This million dollar payment from Omega Protein to the U.S. Treasury is part of our ongoing effort to combat fraud and protect the taxpayer’s dollar.”

The settlement announced today resolves allegations that Omega violated the False Claims Act in March 2010 when it certified to the Department of Commerce that it was complying with federal environmental laws to obtain a $10 million loan.  At the time Omega submitted the certification, it was knowingly violating the Clean Water Act (CWA).  In 2013, Omega Protein, Inc. pled guilty to violations of the CWA between May 2008 and December 2010, by unlawfully discharging pollutants into U.S. waters and, between April 2009 and September 2010, by unlawfully discharging a harmful quantity of oil into U.S. waters.  The criminal matter was United States v. Omega Protein Inc. No. 2:13-cr-00043-RAJ-TEM (E.D. Va.).  

The civil settlement results from a lawsuit brought by Keland O. Harrison, a former employee of Omega, filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private citizens to bring suit on behalf of the United States for false claims, and share in any recovery.  As part of today’s resolution, Mr. Harrison will receive $200,000 of the settlement proceeds. 

The settlement was the result of a coordinated effort by the Civil Division of the Department of Justice, the United States Attorney’s Office for the Western District of Louisiana, and the United States Department of Commerce.         

The civil case is captioned United States ex rel. Harrison v. Omega Protein Corp. and Omega Protein, Inc., Civil Action No.16-cv-00359 (W.D. La.).  The claims resolved by the settlement, except as admitted in the criminal plea, are allegations only, and there has been no determination of liability.

The Justice Department announced today that Northrop Grumman Systems Corporation (NGSC) has agreed to pay $5.2 million to resolve its alleged False Claims Act liability for falsely billing labor under contract with the United States Postal Service (USPS).  NGSC, which is headquartered in Falls Church, Virginia, provides information and technology services to commercial and government customers, including the USPS.

“Those who do business with the government must do so fairly and honestly,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division.  “The Department of Justice will seek appropriate remedies against government contractors who knowingly overcharge the government for their services.”

The settlement concerns the Enterprise Technology Services Contract (ETS Contract) between NGSC and USPS.  The ETS Contract required NGSC to provide qualified labor and management services to augment information technology services at USPS data centers around the country.  The ETS Contract began in 2009 through a predecessor entity, Northrop Grumman Information Technology Inc., which merged with NGSC in 2010. 

Under the ETS Contract, NGSC billed USPS for personnel performing information and technology services using hourly rates established for each of more than 100 labor billing categories.  The United States alleges that NGSC knowingly billed certain personnel working under the ETS Contract for which they did not have the education and/or experience identified by these categories. 

“The U.S. Postal Service manages approximately 30,000 contract actions and spends more than $13 billion on contracted supplies and services each fiscal year,” said Steven Stuller, Acting Special Agent in Charge, U.S. Postal Service Office of Inspector General.  “The Office of Inspector General supports the Postal Service by aggressively investigating allegations of misconduct within these contracts.  In this instance, we worked hand-in-hand with the Department of Justice's Civil Division to help ensure a reasonable case-related resolution.  We applaud the exceptional work by the investigative team and know it will have a positive impact on Postal Service operations.”

This matter was handled by the Civil Division’s Commercial Litigation Branch, the USPS Office of the Inspector General, and the USPS Office of General Counsel.

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

A New York man was sentenced on Jan. 23 in U.S. District Court in the Southern District of New York to 50 months in prison for engaging in an extensive, four-year cyberstalking campaign that targeted a woman he dated for several months.  The victim’s name is being withheld to protect her privacy.

Assistant Attorney Brian A. Benczkowski of the Justice Department’s Criminal Division and U.S. Attorney Geoffrey S. Berman of the Southern District of New York made the announcement. 

David Waldman, 50, of New York, New York, was sentenced by U.S. District Court Judge Katherine Polk Failla of the Southern District of New York, who also ordered him to serve three years of supervised release following his prison sentence.  Waldman, a non-practicing lawyer, was initially arrested in June 2018 and has been detained since his arrest.  In August 2018, he pleaded guilty to one count of cyberstalking.

According to admissions made in connection with his plea and evidence presented at sentencing, Waldman engaged in an extensive cyberstalking campaign targeting a woman he briefly dated.  The campaign began in April 2014, shortly after Waldman and the victim ended their relationship, and continued intermittently until the date of Waldman’s arrest.  Over the course of almost four years, Waldman sent the victim hundreds of text messages, voicemail messages, and e-mail messages, and made voluminous posts on a variety of online platforms, in which he falsely claimed, among other assertions, that she abused drugs, had been diagnosed with bipolar and narcissistic personality disorder, and fabricated claims that she had been a victim of child sexual abuse.  Waldman also sent email messages to the victim’s employers, accusing her of being a “habitual drug user” and claiming that he would sue her for defamation, theft, illegal trespass, violating HIPAA, and engaging in other “illegal behaviors.” 

Throughout the four-year campaign, Waldman also repeatedly threatened to rape, kidnap, torture, injure, and kill the victim, kill members of her family, as well as threatened to kill himself at her apartment.  As recently as 2018, Waldman continued to surveil the victim online and acquired tools that could be used to injure her.  During the search of Waldman’s apartment, agents found, on his kitchen counter, a large hunting knife, which was covered in a sheath.  He had a smaller knife in his bedroom.  Waldman also kept a bb gun in his closet and a lock-picking kit in his carrying bag.  According to Waldman’s internet browser history, in 2018, Waldman tracked the victim’s whereabouts, including her running route, and researched telescopes, “pellet pistols,” “air rifles,” and other similar devices.    

Over the course of Waldman’s cyberstalking campaign, the victim obtained multiple state court orders of protection against him.  Waldman repeatedly violated these orders.

Senior Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Nicholas Chiuchiolo of the Southern District of New York prosecuted the case. 

On Jan. 8, a federal grand jury sitting in the Middle District of Florida returned an indictment charging a U.S. Navy Captain with obstruction of justice, concealment, falsifying records, and false statements during the investigation of the death of a civilian at Naval Station Guantanamo Bay (“GTMO”) in Guantanamo Bay, Cuba.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division made the announcement. 

Captain John Nettleton, 53, of Jacksonville, Florida, was charged with two counts of obstruction of justice related to his actions during the Navy’s investigation of the death of Christopher M. Tur, the Loss Prevention Safety Manager at GTMO’s Naval Exchange.  Nettleton was also charged with one count of concealing information, two counts of falsifying records, and five counts of making false statements.

Tur, 42, was found drowned in the waters of Guantanamo Bay on Jan. 11, 2015.  An autopsy revealed that Tur had suffered injuries prior to his drowning.  At the time of Tur’s death, Nettleton was the Commanding Officer of GTMO. 

According to the indictment, Tur confronted Nettleton at a party at the GTMO Officers’ Club on Jan. 9, 2015 with allegations that Nettleton and Tur’s spouse had engaged in an extramarital affair.  Later that same evening, Tur went to Nettleton’s residence and a physical altercation ensued that left Tur injured.  Tur was reported missing on Jan. 10, 2015 by other residents of GTMO.  Despite knowing that Tur had been at his residence and injured during the altercation, Nettleton falsely informed his superior officers and other Navy personnel that Tur had last been seen at the Officer’s Club the night before, the indictment alleges.  Nettleton also allegedly did not report that Tur had accused him of the extramarital affair, that Nettleton and Tur had engaged in a physical altercation at Nettleton’s residence, or that Tur had been injured.  The indictment further alleges that Nettleton persisted in concealment and false statements as the search for Tur and then the investigation into the circumstances of his death continued.

An indictment is not a finding of guilt.  It merely alleges that crimes have been committed.  A defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The case is being investigated by the Naval Criminal Investigative Service and is being prosecuted by Deputy Chief Todd Gee and Trial Attorney Peter Nothstein of the Criminal Division’s Public Integrity Section.  Former Public Integrity Section Trial Attorney Mark Cipolletti also assisted in the investigation.

On Dec. 11, a federal grand jury in Kansas City, Missouri returned a six-count indictment against a woman for assaulting her infant child while living in military housing in Germany and for obstructing justice and making false statements during the course of the subsequent federal investigation.     

Baillie Rachelle Dickenson, a.k.a. Baillie Hannah, 28, was residing in Kaiserslautern, Germany when the events set forth in the indictment occurred.  She now lives in St. Joseph, Missouri.  She is charged with two counts of assault resulting in serious bodily injury, two counts of obstruction of justice, and two counts of making a false statement to a federal officer.  Dickenson was arrested on Jan. 2, and arraigned before Magistrate Judge Lajuana Counts on Jan. 9.  Trial in this matter has been scheduled for the Sept. 23, 2019 jury trial docket.     

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Timothy A. Garrison of the Western District of Missouri, Major General David P. Glaser of the U.S. Army Criminal Investigation Command, and Darrin E. Jones, FBI Special Agent in Charge, Kansas City Division, made the announcement.  

The indictment alleges that on or about March 12, 2016, Dickenson was living overseas in Kaiserslautern with her then-husband, Derreck Dickenson, who was an active-duty member of the U.S. Army.  The couple resided in military housing with their two minor children, a daughter who was aged 16 months old and a son who was two months old at that time.  While he was in her custody, Dickenson allegedly assaulted her son, causing serious injuries, including multiple fractures, eye injuries, and a serious brain injury.  During the ensuing investigation of the matter, she obstructed justice by concealing a cell phone and influencing her husband’s statement to investigators, and made a series of false statements to investigators when they questioned her.

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

The investigation was conducted by the U.S. Army Criminal Investigation Command and the FBI.  The prosecution is being handled by Trial Attorney Mona Sahaf of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Teresa Moore of the Western District of Missouri.  

A Minneapolis based tax return preparer was sentenced to serve 121 months in prison today for managing and directing a fraudulent return-preparation business, Primetime Tax Services Inc. (Primetime), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman.

Kenneth Mwase, who also fraudulently used the name Chatonda Khofi, 54, of St. Paul, Minnesota, pleaded guilty to one count of conspiracy to defraud the United States, one count of aggravated identity theft, and one count of failure to appear at sentencing. 

In addition to the term of imprisonment, Chief U.S. District Judge John R. Tunheim also ordered Mwase to serve 3 years of supervised release, following his release from prison.

In April 2014, the defendant was charged in a seventy-count second superseding indictment, along with codefendants Ishmael Kosh, 39, of Philadelphia, Pennsylvania, Amadou Sangaray, 36, of New York, New York, and Francis Saygbay, 43, of Minneapolis, and David Mwangi, 47, of Arlington, Texas, for their involvement with Primetime, a tax preparation business with three storefronts in the Minneapolis area.  Together with his co-defendants, Mwase prepared and filed with the Internal Revenue Service (IRS) over 2,000 fraudulent individual income tax returns on behalf of customers of Primetime for the years 2006, 2007 and 2008.  Mwase and his co-defendants also prepared approximately 1,700 fraudulent state income tax returns filed with the state of Minnesota for those years.

In November 2014, Mwase plead guilty to one count of conspiracy to defraud the Government and one count of aggravated identity theft.  As part of his plea agreement, Mwase admitted overseeing a conspiracy that caused a tax loss of over $2.5 million dollars.  Mwase and co-defendants Kosh, Sangaray, and Saygbay established Primetime’s flagship location in Brooklyn Center, Minnesota, in late 2006.   They then prepared tax returns in 2007, 2008, and 2009, for Primetime’s customers, which reported false dependents, fake business income and losses, inflated deductions, inflated credits, and false filing statuses, in order to get their customers inflated refunds. The defendants maintained control over their customers’ IRS refunds by instructing  that those  refunds be sent directly to Primetime.  They then caused their preparation fee to be directly withdrawn from the refund. When a customer came to pick up their refund check or debit card, the defendants sometimes escorted that customer to a check cashing location or ATM and demanded additional cash.

Mwase was scheduled to be sentenced on August 18, 2016, following the two-week trial of co-defendants Kosh and Sangaray, which occurred in September 2015, and the guilty plea of co-defendant Saygbay, in November 2015. However, on August 7, 2016, he fled to South Africa, using a fake identity and a fraudulently-obtained Zimbabwean passport. In April 2017, Mwase was charged with one count of failure to appear for sentencing.

With the assistance of the United States Department of State, INTERPOL, and Zimbabwean and South African authorities, Mwase was arrested in South Africa in May 2018. Over the years, Mwase used multiple fake identities, including passing himself off as Chatonda Khofi, an individual born in Washington, D.C. to diplomats from Malawi. In October 2018, following an extradition request from the United States, Mwase was surrendered to the custody of the United States Marshals Service and returned to Minnesota to face sentencing. On November 16, 2018, Mwase pled guilty to the charge of failing to appear for sentencing.  Mwase’s co-conspirators were previously sentenced to prison.

The case was investigated by special agents of IRS-Criminal Investigation and deputy marshals of the United States Marshals Service. It was prosecuted by Trial Attorneys Thomas W. Flynn and Arthur J. Ewenczyk, as well as former Trial Attorneys Dennis R. Kihm and Ryan R. Raybould, of the Tax Division who prosecuted the case. The Tax Division would like to thank the Minnesota Department of Revenue for their significant work in identifying the tax fraud and identity theft occurring at Primetime.

A woman from Miami, Florida was sentenced to 51 months in prison on Jan. 17 for her role in a $4.66 million health care fraud scheme involving several Miami-area home health agencies, including Sunshine Home Health Services Inc., Empire Home Health Agency Inc., Mildred & Marce Home Health Care Services Inc., and Nursing Care PRN Inc., which purported to provide home health services to Medicare patients.    

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, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.

Norma Zayas, 29, of Miami, was sentenced by U.S. District Judge Jose E. Martinez of the Southern District of Florida.  Judge Martinez also ordered Zayas to pay $4,658,241.00 in restitution and to forfeit $186,650.50.  Zayas pleaded guilty on Oct. 22, 2018 to one count of conspiracy to commit health care fraud. 

As part of her guilty plea, Zayas admitted that from approximately January 2010 through approximately January 2014, she operated Sunshine, Empire, and Mildred & Marce Home Health and paid kickbacks to patient recruiters in return for the referral of Medicare beneficiaries, many of whom did not need or qualify for home health services.  Zayas further admitted that she became the true owner of Nursing Care PRN, which she placed in the name of a nominee owner.  She also paid kickbacks to patient recruiters who referred Medicare beneficiaries to Nursing Care PRN.

The defendant admitted that, as a result of false and fraudulent claims submitted as part of this conspiracy, Medicare made payments of nearly $4.66 million.  Zayas was charged along with Margarita Palomino, 54, of Homestead, Florida in an indictment returned on June 7, 2018.  Palomino was sentenced in December 2018 to a term of 78 months in prison and ordered to pay over $4.65 million in restitution, as well as to forfeit $186,650.50.

The FBI and HHS-OIG investigated the case, which was brought as part of the Medicare Fraud Strike Force under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.  Former Fraud Section Trial Attorney and current Assistant U.S. Attorney Leslie Wright prosecuted the case; the case is now being handled by Trial Attorney Emily Gurskis of the Fraud Section.

The Criminal Division’s Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

A Miami, Florida woman was sentenced to 46 months in prison on Jan. 3 for her role in a $1.36 million health care fraud scheme. 

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, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.

Tania Gudin, 55, was sentenced by U.S. District Judge K. Michael Moore of the Southern District of Florida.  Judge Moore also ordered Gudin to pay $1,366,317.59 in restitution and to forfeit $512,806.05.  Gudin pleaded guilty on Oct. 23, 2018 to one count of conspiracy to commit health care fraud and wire fraud. 

Gudin pleaded guilty to accepting kickbacks for recruiting and referring Medicare beneficiaries to five Miami-area businesses that claimed to provide home health care services: Maya Home Health Care Corp., Floridian Home Health Care Corp., Healthylife Home Care Inc., ACM Home Health Corp., and Humanity Home Health Inc.  She also owned her own medical clinic, the New City Medical Center Inc., which she admittedly utilized to further the scheme, including by obtaining prescriptions for her recruited patients from medical professionals at New City.      

As part of her guilty plea, Gudin admitted that from approximately July 2011 through approximately November 2014, she accepted kickbacks in return for the referral of Medicare beneficiaries, many of whom did not need or qualify for home health services, to serve as patients of the five agencies.  Gudin caused Maya, Floridian, Healthylife, ACM, and Humanity to submit false claims to Medicare for home health services for the beneficiaries she recruited, which were medically unnecessary, not eligible for Medicare reimbursement and/or – either with Gudin’s knowledge or direction – never actually provided.   

Gudin admitted that, as a result of false and fraudulent claims submitted as part of this conspiracy, Medicare made payments of at least $1.36 million. 

The FBI and HHS-OIG investigated the case, which was brought as part of the Medicare Fraud Strike Force under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.  Former Fraud Section Trial Attorney and current Assistant U.S. Attorney Leslie Wright of the District of Boston prosecuted the case; the case is now being handled by Trial Attorney Emily Gurskis of the Fraud Section.

The Criminal Division’s Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

A woman from Miami, Florida was sentenced to 30 months in prison on Jan. 15 for her role in a $750,000 health care fraud scheme involving six Miami-area home health agencies, Sunshine Home Health Services Inc., Empire Home Health Agency Inc., A&C Home Health Care Inc., Healthylife Home Car, Humanity Home Health and ACM Home Health Corp., which purported to provide home health services to Medicare patients.   

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, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.

Milena Gonzalez, 54, of Miami, was sentenced by U.S. District Judge Jose E. Martinez of the Southern District of Florida.  Judge Martinez also ordered Gonzalez to pay $478,560.54 in restitution and to forfeit $346,595.00.  Gonzalez pleaded guilty on Oct. 24, 2018 to one count of conspiracy to defraud the United States and to pay and receive health care kickbacks. 

As part of her guilty plea, Gonzalez admitted that from approximately November 2010 through approximately September 2015, she accepted kickbacks in return for the referral of Medicare beneficiaries, many of whom did not need or qualify for home health services, to serve as patients of the six agencies.  Gonzalez further admitted that in addition to receiving kickbacks, she paid kickbacks to the owners and operators of a medical clinic called City Rehab Corp., in return for prescriptions for home health services for her recruited Medicare beneficiaries. 

The defendant admitted that, as a result of false and fraudulent claims submitted as part of this conspiracy, Medicare made payments of at least approximately $750,000.

Gonzalez was charged along with Nelson Anzardo Calzadilla, 55, of Miami, in an indictment returned on June 15, 2018.  Nelson Anzardo Calzadilla pleaded guilty to conspiracy to commit health care fraud and wire fraud and is scheduled for sentencing in February 2019.

The FBI and HHS-OIG investigated the case, which was brought as part of the Medicare Fraud Strike Force under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.  Former Fraud Section Trial Attorney and current Assistant U.S. Attorney Leslie Wright prosecuted the case; the case is now being handled by Trial Attorney Emily Gurskis of the Fraud Section.

The Criminal Division’s Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

An Indian national pleaded guilty on Jan. 18 for his role in a complex, transnational conspiracy to smuggle aliens from India to the Unites States for profit, which claimed at least one life and endangered many others.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Agent in Charge Ivan Arvelo of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in Puerto Rico made the announcement.

Yadvinder Singh Bhamba, 60, an Indian national, pleaded guilty to one count of conspiracy and 15 counts of smuggling aliens to the United States for profit before U.S. Magistrate Judge Sivia Carreño-Coll of the District of Puerto Rico.  Judge Carreño-Coll has recommended that District Judge Carmen C. Cerezo accept the guilty plea.  A sentencing hearing before Judge Cerezo is scheduled for April 23, 2019.  Bhamba was charged in an indictment returned by a federal grand jury in the District of Puerto Rico on March 15, 2017.

According to admissions in Bhamba’s plea agreement, since 2013, Bhamba had a leadership role in a human smuggling conspiracy operating out of the Dominican Republic, Haiti, Puerto Rico, India and elsewhere.  As part of the conspiracy, Bhamba personally assisted around 400 aliens to unlawfully enter the United States between 2013 and 2015.  He also oversaw and directed co-conspirators operating out of the Caribbean.

Bhamba and other members of the conspiracy made flight arrangements for aliens to travel from India through other countries – including Thailand, the United Arab Emirates, Argentina, Iran, Panama, Venezuela, Belize, and Haiti – to the Dominican Republic. The Dominican Republic was used as a staging area, where aliens were housed before being transported to the United States.  The organization brought groups of aliens from the Dominican Republic to Puerto Rico or Florida by boat.  Once the aliens reached Puerto Rico or Florida, they were picked up by co-conspirators and taken to stash houses until flights could be arranged to California, New York, or elsewhere in the United States.  Bhamba and others arranged for fraudulent identifications for some aliens to use in the United States.

The boat trips organized by Bhamba and his co-conspirators were perilous.  Boat captains used old, damaged, cracked, unlicensed, overcrowded, and unsafe boats to make the journey.  In at least one instance, an alien died in a boat on his way to the United States.  

At times, the smugglers would take passports from the aliens during their journeys, physically assault them, and threaten their families to collect money.  Aliens paid between $30,000 and $85,000 to be smuggled from India to the United States.  From at least 2013 to 2016, human smuggling was Bhamba’s primary source of income.

Members of the conspiracy, including Bhamba, would use false names or nicknames to communicate with the aliens and with each other.  Bhamba, whom fellow smugglers and aliens knew as “Ruby,” also instructed others to use false names or nicknames to avoid detection. Bhamba used fraudulent Indian, Dominican, and Jamaican identifications for travel and financial transactions related to the conspiracy.

As part of the conspiracy, Bhamba directed associates to unlawfully smuggle 15 aliens to Puerto Rico in July 2016.  Bhamba personally met the 15 aliens in various countries along their journeys, including in Dubai, Thailand, Iran, and the Dominican Republic, and he communicated with them throughout their journeys, which began approximately in January 2016.  In some instances, Bhamba created and provided false employment documents on behalf of the aliens to authorities to obtain foreign visas.  Bhamba also instructed aliens traveling through foreign airports how to find, and in some instances, pay cash to, corrupt immigration officials, passport control officers, or airport employees in order to bypass regular immigration and passport control procedures.

After the aliens arrived in the Dominican Republic, Bhamba used an alias to arrange and pay for a hotel for them.  On July 25, 2016, Bhamba alerted co-conspirators in Puerto Rico to be ready to receive 15 aliens. On July 27, 2016, 15 Indian nationals were transported from the Dominican Republic to Puerto Rico in a 22-foot wooden vessel. The vessel was not marked or equipped with basic safety features, such as lights or navigational equipment.  The outside of the vessel was painted black, to make it difficult to see in the water at night. Per safety regulations, the size of the boat should have limited the number of occupants to eight people, but it carried 15 aliens, plus members of the conspiracy who captained the vessel.

The aliens were supposed to be met in Puerto Rico by another smuggler, but they were apprehended instead.  Bhamba contacted other members of the conspiracy to find out what happened to the aliens and paid a co-conspirator to locate the aliens and confirm they did not drown, so that the co-conspirators would not lose money.  Bhamba was arrested in the Dominican Republic in August 2017, and thereafter transferred to Puerto Rico.   

The investigation was conducted under the Extraterritorial Criminal Travel Strike Force (ECT) program, a joint partnership between the Justice Department’s Criminal Division 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 Puerto Rico investigated this case.  The government of the Dominican Republic and the Transnational Crime Investigative Unit of the Dominican Republic National Police provided significant assistance and support during the investigation and have brought charges against other members of the smuggling network.

Trial Attorneys Ann Marie E. Ursini and Christian A. Levesque of the Criminal Division’s Human Rights and Special Prosecutions Section prosecuted the case, with the assistance of the Department of Justice’s Office of International Affairs and the U.S. Attorney’s Office for the District of Puerto Rico.

The owner and operator of a purported medical clinic, QC Medical Clinic, was convicted on Jan. 24, by a federal jury of participating in an $11 million Medicare fraud scheme in which fraudulent medical documents were sold to home-health agencies in and around Houston.

The conviction was announced by Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Ryan Patrick of the Southern District of Texas and Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office.

Brenda Rodriguez, 57, of Harris County, Texas, was convicted of one count of conspiracy to commit healthcare fraud and three counts of healthcare fraud following a jury trial before U.S. District Judge Lynn Hughes of the Southern District of Texas.  Rodriguez is expected to be sentenced on April 29.

According to the evidence presented at trial, from October 2012 through August 2015, Rodriguez and others conspired to defraud Medicare by selling Plans of Care, and other medical documents signed by a doctor, through QC Medical Clinic (“QC Medical”) to various home-health services, resulting in approximately $11 million in false and fraudulent claims for home-health services billed to Medicare. 

The evidence at trial showed that home-health agencies billed Medicare for home health services that were not medically necessary and in many instances, not provided. 

To date, three others have pleaded guilty or were convicted based on their roles in a larger fraudulent scheme that included QC Medical.  John Ramirez, M.D., was convicted of conspiracy to commit healthcare fraud and healthcare fraud for his role at a related purported clinic and is awaiting sentencing before U.S. District Judge David Hittner of the Southern District of Texas.  Nenna Iro and Magdalene Akharamen, owners of Houston area home-health agencies, each pleaded guilty to conspiracy to commit healthcare fraud in purchasing Plans of Care and other signed medical documents from QC Medical. 

The case was investigated by the FBI, and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Texas.  The case is being prosecuted by Trial Attorney Scott Armstrong of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Tina Ansari and Thomas Heyward Carter.

The Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and the U.S. Department of Health and Human Services (HHS) to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.

Four Audi managers, including a former member of Audi AG’s management board, were charged in an indictment filed on Jan. 17 for their roles in the nearly decade-long conspiracy to defraud U.S. regulators and U.S. customers by implementing software specifically designed to cheat U.S. emissions tests in tens of thousands of Audi “clean diesel” vehicles, the Justice Department announced today.

Principal Deputy Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, Deputy Assistant Attorney General Jean Williams of the Justice Department’s Environment and Natural Resources Division, U.S. Attorney Matthew Schneider of the Eastern District of Michigan, Assistant Administrator of the Environmental Protection Agency (EPA) Office of Enforcement and Compliance Assurance Susan Bodine, and Special Agent in Charge Timothy R. Slater of the FBI Detroit Field Office made the announcement.

Richard Bauder, 69, former head of Audi’s Diesel Engine Development Department; Axel Eiser, 57, former head of Audi’s Engine Development Division; Stefan Knirsch, 52, former head of Audi’s Engine Development Division and a former member of Audi’s Management Board, and Carsten Nagel, 50, former head of Diesel Certification, were charged in the Eastern District of Michigan with one count of conspiracy to defraud the United States, to commit wire fraud and to violate the Clean Air Act, along with multiple counts of wire fraud and multiple counts of making false statements under the Clean Air Act.  All four are believed to be citizens of Germany.  These individuals join Giovanni Pamio, 61, an Italian citizen, who was charged via criminal complaint in July 2017 and whose extradition from Germany is being sought by U.S. authorities.  Pamio was formerly head of Thermodynamics within Audi’s Diesel Engine Development Department in Neckarsulm, Germany. 

According to the indictment, from in or about 2006 until in or about November 2015, Pamio led a team of engineers responsible for designing emissions control systems to meet emissions standards, including for nitrogen oxides (NOx), for Audi 3.0 liter diesel vehicles in the United States. 

The indictment further alleges, when Bauder, Eiser, Knirsch, Nagel and Pamio realized that it was impossible to calibrate a diesel engine that would meet NOx emissions standards within the design constraints imposed by other departments at the company, they directed Audi employees to design and implement a software function to cheat the standard U.S. emissions tests.  The co-conspirators deliberately failed to disclose the software function, and knowingly misrepresented to U.S. regulators and U.S. customers that the vehicles complied with U.S. NOx emissions standards, the indictment alleges. Bauder, Eiser, Knirsch, Nagel, and Pamio also are alleged to have marketed the Audi 3.0 liter vehicles to the U.S. public as “clean diesel,” when they knew that these representations were false.

Audi’s parent company, Volkswagen AG (VW), previously pleaded guilty to three felony counts connected to cheating U.S. emissions standards.  VW was sentenced in April 2017, and the company paid a $2.8 billion criminal penalty.

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

The FBI and EPA-CID investigated the case. This case is being prosecuted by Trial Attorneys Christopher Fenton and David Fuhr of the Criminal Division’s Fraud Section, Senior Trial Attorney Jennifer Blackwell and Trial Attorney Joel La Bissonniere of the Environment and Natural Resources Division’s Environmental Crime Section, and White Collar Crime Unit Chief John K. Neal and Assistant U.S. Attorney Timothy J. Wyse of the Eastern District of Michigan.  The Criminal Division’s Office of International Affairs also assisted in the case. The Department of Justice also extends its thanks to the Munich II Prosecutor’s Office in Munich, Germany, for its assistance.

Daniel William Aston, a former e-commerce executive, pleaded guilty on Jan. 17, 2019 for conspiring to fix the prices of posters sold online.  Aston, a resident and citizen of the United Kingdom, was indicted by a federal grand jury in the Northern District of California on Aug. 27, 2015.  Aston was a fugitive until his arrest in Spain in May 2018.  After his arrest, he spent over five months in Spanish custody before agreeing to submit to U.S. jurisdiction and answer to price-fixing charges. 

Aston is the former Director and part owner of Trod Limited (doing business as Buy 4 Less, Buy For Less, and Buy-For-Less-Online), a U.K. company headquartered in Birmingham, England, which was also charged in the indictment.  Trod Ltd. pleaded guilty to the price-fixing charges on Aug. 11, 2016.  Aston admitted to fixing the price of certain posters sold in the United States on Amazon Marketplace from as early as September 2013 to approximately January 2014.  Following his guilty plea, Aston was sentenced to serve a custodial sentence of six months, with credit for the time he served in Spanish custody.  Aston will serve the remainder of his custodial sentence under supervised release. 

“Today’s announcement represents another successful development in the Division’s first online marketplace prosecution involving algorithmic pricing tools and a warning to fugitives who attempt to evade prosecution,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division.  “Americans shopping online, like all consumers, deserve the benefit of a market free from collusion.  The Division and its law enforcement partners are committed to investigating and prosecuting individuals, wherever located, who collude through new and sophisticated means, including algorithmic pricing software.”

According to the charge, Aston and his co-conspirators discussed the prices of certain posters sold in the United States through Amazon Marketplace and agreed to fix, increase, maintain, and stabilize the prices of those posters.  In order to implement their agreements, the defendant and his co-conspirators agreed to adopt specific pricing algorithms for the sale of certain posters with the goal of coordinating changes to their respective prices.

This prosecution arose from a federal antitrust investigation into price fixing in the online wall décor industry being conducted by the Antitrust Division’s San Francisco Office with the assistance of the FBI’s San Francisco Field Office.  Anyone with information on price fixing or other anticompetitive conduct related to other products in the wall décor industry should contact the Antitrust Division’s Citizen Complaint Center at 888-647-3258 or visit www.justice.gov/atr/contact/newcase.html.

The former chief executive officer and senior vice president of Insurance Corporation of Barbados Limited (ICBL), a Barbados-based insurance company, were charged in an indictment unsealed on Jan. 18, with laundering bribes to the former Minister of Industry of Barbados in exchange for his assistance in securing government contracts for ICBL. 

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Richard P. Donoghue of the Eastern District of New York and Assistant Director-in-Charge William F. Sweeney Jr. of the FBI’s New York Field Office made the announcement.

Ingrid Innes, 63, a citizen of Canada, and Alex Tasker, 58, a citizen of Barbados, were charged with one count of conspiracy to launder money and two counts of money laundering in an indictment returned in Aug. 22, 2018, by a federal grand jury sitting in Brooklyn, New York.  The former Minister of Industry of Barbados, Donville Inniss, 52, a U.S. legal permanent resident who resided in Tampa, Florida, and Barbados, was charged with the same crimes in an indictment unsealed on Aug. 6, 2018, and was also charged as a co-defendant of Innes and Tasker in the superseding indictment.

The indictment alleges that in 2015 and 2016, Innes, then the chief executive officer of ICBL, and Tasker, then a senior vice president of ICBL, took part in a scheme to launder into the United States approximately $36,000 in bribes that they paid to Inniss, who at the time was a member of the Parliament of Barbados and the Minister of Industry, International Business, Commerce and Small Business Development of Barbados.  In exchange for the bribes, Inniss allegedly leveraged his positon as the Minister of Industry to enable ICBL to obtain two government contracts.  According to the allegations, Inniss arranged to receive the bribes through a U.S. bank account in the name of a dental company with an address in Elmont, New York, in order to conceal the scheme.

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

ICBL voluntarily self-disclosed the case and received a declination under the FCPA Corporate Enforcement Policy.  ICBL disgorged $93,940.19 in illicit profits that it earned from the scheme.

The FBI’s New York Field Office and International Corruption Squad is investigating the case.  In 2015, the FBI formed International Corruption Squads across the country to address national and international implications of foreign corruption. 

Trial Attorney Gerald M. Moody Jr. of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Sylvia Shweder of the Eastern District of New York are prosecuting the case.  The Criminal Division’s Office of International Affairs provided significant assistance in this matter.

The Fraud Section is responsible for investigating and prosecuting all Foreign Corrupt Practices Act (FCPA) matters.  Additional information about the Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.   

The former chief executive officer of a now-bankrupt public air charter operator was sentenced to 94 months in prison on Jan. 11 for her role in a scheme to steal millions of dollars in passenger money for future travel from an escrow account, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Regional Special Agent in Charge Douglas Shoemaker of the U.S. Department of Transportation Office of the Inspector General’s (DOT-OIG).

Judy Tull, 73, of Edenton, North Carolina, was sentenced by U.S. District Judge Susan D. Wigenton of the District of New Jersey, who presided over the trial.  Judge Wigenton also ordered the defendant to pay $19.6 million in restitution.  Tull and her co-defendant, Kay Ellison, 58, also of Edenton, were both convicted on March 28, 2018 after a seven-day trial, of one count of conspiracy to commit wire fraud affecting financial institutions and to commit bank fraud, four counts of wire fraud affecting financial institutions and three counts of bank fraud.  Tull is the former CEO of Myrtle Beach Direct Air and Tours (Direct Air), which was headquartered in Myrtle Beach, South Carolina, with operations in Daniels, West Virginia, and Ellison is its former vice president and managing partner.  Judge Wigenton sentenced Ellison on Nov. 28, 2018 to 94 months in prison and ordered her to pay $19.6 million in restitution.

According to evidence presented at trial, from October 2007 through March 2012, Tull and Ellison engaged in a scheme to steal passengers’ money for future travel from an escrow account by artificially inflating the amount of money that the defendants claimed they were entitled to receive, and by sending this falsified amount in a letter to the escrow bank telling the escrow bank to release the money.  The evidence further established that to cover up their fraud, the defendants falsified profit and loss statements to make the company look like it was making money rather than losing money, and sent these falsified documents to credit card companies and banks to trick them into continuing to do business with the company.

Testimony at trial established that two financial institutions incurred losses of nearly $30 million for having to refund thousands of passengers their money that should have been held for them in escrow, but was actually stolen by the defendants as part of their fraud.

Robert Keilman, 73, of Marlboro, New Jersey, Direct Air’s former chief financial officer, pleaded guilty to charges stemming from his role in this scheme and was sentenced separately. 

This case was investigated by DOT-OIG.  Trial Attorneys Cory E. Jacobs and Michael T. O’Neill of the Criminal Division’s Fraud Section are prosecuting the case. 

The Criminal Division’s Fraud Section plays a pivotal role in the Department of Justice’s fight against complex white collar crime around the country.

On Jan. 24, Canadian authorities extradited Christopher Bantli, a prolific vendor of various controlled substances, to the United States to face drug trafficking charges filed in the District of Columbia.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Agent in Charge Marcus Anderson of the Drug Enforcement Administration’s (DEA) Orlando Field Office made the announcement.

Bantli, 39, arrived in the United States Thursday evening and made an initial appearance on Friday, Jan. 25 before U.S. Magistrate Judge Robinson in federal court in Washington, D.C. Bantli is charged in a seven-count indictment alleging that from November 2015 through September 2016, he imported into the United States from Canada and elsewhere various controlled substances, including powerful synthetic opiates such as acetyl fentanyl.  This case is assigned to U.S. District Judge Amy Berman Jackson.

The case was investigated by the DEA, in cooperation with Canadian law enforcement authorities.  Trial Attorney Brian Nicholson of the Department of Justice’s Office of International Affairs provided significant assistance in bringing Bantli to the United States and procuring foreign evidence during the investigation.  The U.S. Marshals Service provided critical assistance by assisting in the extradition.

The U.S. Department of Justice thanks the Government of Canada for its assistance in this case, in particular the Calgary Police Service Cybercrime Support Team.

This case is also the result of the ongoing efforts by the Organized Crime Drug Enforcement Task Forces (OCDETF), a partnership that brings together the combined expertise and unique abilities of federal, state, and local enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle, and prosecute high-level members of drug trafficking, weapons trafficking, and money laundering organizations and enterprises.

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

Trial Attorneys Kaitlin Sahni and Anthony Aminoff of the Criminal Division’s Narcotic and Dangerous Drug Section (NDDS) are prosecuting the case. Deputy Chief of the Money Laundering and Asset Recovery Section’s (MLARS) Special Financial Investigations Unit Stephen Sola and Trial Attorney Erin Cox, both formerly of NDDS, also provided significant assistance on the case.

The indictment charges Johnny and Maria Moore, from the District of Columbia, along with Charese Johnson, aka Charese Adesalu, from Aberdeen, Maryland, with conspiring to defraud the United States in an effort to obtain fraudulent  refunds from the Internal Revenue Service (IRS).  The indictment also charges the Moores with aiding and assisting in the preparation of false trust tax returns (Forms 1041), and filing their own false amended personal income tax returns (Forms 1040X) with the IRS.  Additionally, Johnson is charged with aiding and assisting the Moores in preparing their false Forms 1040X. 

To further the scheme, the Moores, together with Johnson and another co-conspirator, allegedly prepared and filed tax returns that claimed either false withholdings or false credits.  Based on those alleged falsities, they requested significant refunds to which they were not entitled.  The Moores allegedly received a refund of over $500,000 for one trust tax return filed for the 2012 tax year.  As charged in the indictment, when the IRS sought to recoup that refund, Johnson conspired with the Moores and others to obstruct the IRS collection efforts.

If convicted, the defendants each face a maximum sentence of 5 years for the conspiracy charge, and 3 years for each of the false return charges.  The defendants also face substantial monetary penalties, supervised release, and restitution.

Principal Deputy Assistant Attorney General Zuckerman commended special agents of Internal Revenue Service-Criminal Investigation, who investigated this case, and Trial Attorneys Abigail Burger Chingos and Jeffrey McLellan of the Tax Division, who are prosecuting this case.

An indictment merely alleges that crimes have been committed. The defendants are presumed innocent until proven guilty beyond a reasonable doubt.

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

A Chicago, Illinois-based clinical psychologist was charged in an indictment filed on Jan. 3, for his participation in a health care fraud scheme involving approximately $3.2 million in allegedly fraudulent claims billed to Medicare for psychological counseling and psychological testing for severely mentally disabled adults that was never actually performed.

Assistant Attorney General Brian Benczkowski of the Justice Department’s Criminal Division, Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Chicago Regional Office and Special Agent in Charge Jeffrey S. Sallet of the FBI’s Chicago Field Office made the announcement

Hubert Dolezal, Ph.D., 78, of Chicago, was charged in an indictment filed in the Northern District of Illinois with 15 counts of health care fraud.   

According to the indictment, from December 2012 to June 2018, Dolezal allegedly engaged in a scheme to bill Medicare for psychological counseling, psychological testing and neuropsychological testing of severely mentally disabled adults living in community-based housing.  The indictment alleges that Dolezal defrauded Medicare through submission of claims for services that were never performed, and for services performed on a routine, rather than an as-needed basis.  The indictment also alleges that Dolezal was also double-paid for services, collecting payment from Medicare and the organization running the community-based housing.

The indictment alleges that Dorezal submitted approximately $4.4 million in fraudulent claims to Medicare, and that Medicare paid a total of approximately $3.2 million on those claims.

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

This case was investigated by HHS-OIG and the FBI.  Trial Attorney Leslie S. Garthwaite of the Criminal Division’s Fraud Section is prosecuting the case. 

The Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and the U.S. Department of Health and Human Services (HHS) to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.

A California doctor was sentenced to 42 months in prison on Jan. 22  for his role in a Medicare kickback conspiracy involving a Los Angeles-area home health agency. 

Kanagasabai Kanakeswaran, M.D., 65, of Lancaster, California, was sentenced by U.S. District Judge Philip S. Gutierrez of the Central District of California, who also ordered Kanakeswaran to forfeit $509,662 to the United States.  Following a six-day trial, Kanakeswaran was convicted by a federal jury in Los Angeles, California, on Aug. 23, 2018, on one count of conspiracy to pay and/or receive kickbacks for Medicare referrals and four counts of receiving kickbacks for Medicare referrals. 

According to evidence presented at trial, from 2008 to 2016, Kanakeswaran and others engaged in a conspiracy to refer Medicare patients to Star Home Health Resources (Star), a home health agency located in La Verne, California in exchange for illegal kickback payments.  Kanakeswaran received cash kickback payments, as well as kickback payments by check through a company Kanakeswaran owned called Digital Perfection Corporation, the evidence showed. The evidence presented at trial showed that Kanakeswaran received illegal kickbacks from Star in the amount of $509,662.

As a result of the conspiracy, the owners and operators of Star submitted claims to Medicare based on the Medicare beneficiaries that Kanakeswaran referred to Star, and Medicare paid approximately $4.1 million based on those claims, the evidence showed.

This case was investigated by HHS-OIG and the FBI.  Trial Attorney Claire Yan of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Alexander F. Porter of the Major Frauds Section of the Central District of California are prosecuting the case.

The Department of Justice announced that on Dec. 28, 2018 Los Angeles-based Avanti Hospitals LLC (Avanti) and six of its owners will pay the federal government $8.1 million to settle claims that they violated the False Claims Act by submitting, or causing Avanti’s subsidiary, Memorial Hospital of Gardena (Gardena Hospital), to submit false claims to the Medicare and Medicaid programs for medical services referred by a physician who received kickbacks and other improper payments from Gardena and other Avanti affiliates. 

“Financial arrangements that improperly compensate physicians for referrals encourage physicians to make decisions based on financial gain rather than patient needs,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division.  “The Department of Justice is committed to preventing illegal financial relationships that undermine the integrity of our public health programs.”

The government alleged that the payments from Avanti, Gardena Hospital and at least two other Avanti affiliates to a high-referring physician violated the Anti-Kickback Statute and the Physician Self-Referral Law, commonly known as the Stark Law.  The Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally funded programs.  The Stark Law prohibits a hospital from billing Medicare for certain services referred by physicians with whom the hospital has an improper compensation arrangement.  Both the Anti-Kickback Statute and the Stark Law are intended to ensure that a physician’s medical judgment is not distorted by improper financial incentives and is instead based only on the best interests of the patient.

The settlement announced resolved allegations that Avanti, Gardena Hospital and at least two other Avanti affiliates provided compensation to a physician they engaged as a medical director that (1) exceeded fair market value for his services, and (2) was an attempt to incentivize him to refer patients to Gardena Hospital.   

“Illegal kickbacks paid to doctors for referrals burden our healthcare system, drive up insurance costs for everyone, and corrupt the doctor-patient relationship,” said United States Attorney Nick Hanna for the Central District of California. “Patients are not commodities who can be sold to the highest bidder, especially when the bills are ultimately being paid by American taxpayers.”

Avanti and Gardena Hospital have also entered into a corporate integrity agreement with the Department of Health and Human Services Office of Inspector General (HHS-OIG). 

“Patients and taxpayers rightly should expect that referrals be based on sound medical judgement, not driven by thinly veiled bribes, as alleged here,” said Christian J. Schrank, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “Our compliance agreement with Avanti and Gardena Hospital contains strong monitoring and reporting provisions to help ensure that people in government health programs will be protected.”  

The settlement partially resolves allegations originally brought in a lawsuit filed under the qui tam, or whistleblower, provisions of the False Claims Act by Dr. Joshua Luke, the former C.E.O. of Gardena Hospital.  The act permits private parties to sue on behalf of the government for false claims for government funds and to receive a share of any recovery.  The government may intervene and file its own complaint in such a lawsuit.  Dr. Luke will receive approximately $1.6 million from the federal government.

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

This matter was handled by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Central District of California, and the Department of Health and Human Services Office of Inspector General.

The case is docketed as U.S. ex rel. Luke, State of California ex rel. Luke v. Gardena Hospital, L.P. DBA Memorial Hospital of Gardena, Avanti Hospitals, LLC, et al., CV 15-08732 FMO (C.D. Cal.) (PARTIALLY UNDER SEAL).  The claims resolved by the settlement are allegations only; there has been no determination of liability.

A commodities trader at an Australian proprietary trading firm (Trading Firm A) pleaded guilty on Dec. 26, 2018 to spoofing in connection with his fraudulent and deceptive trading activity in the E-mini S&P 500 futures contracts market on the Chicago Mercantile Exchange (CME).

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Special Agent in Charge Jeffrey S. Sallet of the FBI’s Chicago Field Office made the announcement.

Jiongsheng (“Jim”) Zhao, 31, of Sydney, Australia, pleaded guilty before U.S. District Judge John J. Tharp Jr. of the Northern District of Illinois to one count of spoofing.  Zhao was extradited to the United States on Nov. 16 and made his first court appearance on Nov. 19.  Sentencing is scheduled for July 19, 2019 before Judge Tharp.

“For almost four years, Jim Zhao placed thousands of phony orders for E-mini S&P 500 futures contracts that he never intended to execute—all in an effort to fraudulently move the market to his own advantage,” said Assistant Attorney General Benczkowski.  “The Department and our law enforcement partners will use every tool at our disposal to identify and prosecute those who engage in manipulative trading activity on U.S. markets.”

As part of his plea, Zhao admitted that from approximately July 2012 through March 2016, he placed thousands of orders for E-mini S&P 500 futures contracts on the CME, a commodities exchange operated by CME Group Inc., that, at the time Zhao placed the orders, he intended to cancel before execution (the Spoof Orders).  Zhao admitted that typically he engaged in this trading strategy when he already had an order for E-mini S&P 500 futures contracts pending in the market that he did want to execute, but that was not being filled (the Primary Order).  Zhao admitted that he would place the Spoof Orders on the opposite side of the market from the Primary Order with the goal to induce other market participants to trade against his Primary Order.  This trading strategy, Zhao admitted, was intended to inject materially false and misleading liquidity and price information into the E-mini S&P 500 futures contracts market by placing the Spoof Orders in order to deceive other market participants about the existence of supply and demand.  The Spoof Orders were designed to artificially move the price of E-mini S&P 500 futures contracts in a direction that was favorable to Zhao, and to the detriment of other market participants.  In pleading guilty, Zhao admitted that he placed the Spoof Orders in order to generate profits (or mitigate losses) for himself and Trading Firm A, and that Trading Firm A kept a percentage of Zhao’s trading profits, ranging at various times from 20 percent to 50 percent.

According to admissions in the plea agreement, in approximately March 2016, the CME began an investigation into Zhao’s trading activity in connection with the E-mini S&P 500 futures contracts.  As part of that investigation, Zhao submitted to a CME interview, and provided the CME with written responses to explain his trading activity, including three specific examples of Zhao’s trading activity.  In a written response submitted to the CME, Zhao stated that all of the orders identified in the three examples were part of either a “scalping” or spread trading strategy and were placed with the intention to execute.  In truth and in fact, however, Zhao admitted as part of his plea that when providing this response to the CME, he knew that he had placed certain large orders identified in each example with the intent, at the time they were placed, to cancel them before execution (i.e., the large orders were Spoof Orders).  Zhao admitted that his statement to the CME that he placed these large orders with the intention that they be filled was false and misleading, and that he made this false statement in order to falsify, conceal and cover up his spoofing conduct.

This case is the result of an ongoing investigation by the FBI’s Chicago Field Office.  The International Crime Cooperation Central Authority of the Australian Government Attorney-General’s Department, the Australian Federal Police and the Criminal Division’s Office of International Affairs provided significant assistance in connection with the arrest and extradition of Zhao.  The Commodity Futures Trading Commission’s Division of Enforcement and the Australian Securities and Investments Commission also provided substantial assistance in this case.

Trial Attorney Matthew F. Sullivan and Assistant Chief Justin D. Weitz of the Criminal Division’s Fraud Section are prosecuting the case.

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

Michael McWhorter, de 29 años, y Joe Morris, de años 23, ambos vecinos de Clarence, Illinois, se declararon culpables hoy ante múltiples cargos, entre ellos cargos relacionados con derechos civiles federales, ante el Tribunal de Distrito Federal en St. Paul, Minnesota. La Fiscal Federal para el Distrito de Minnesota, Erica H. MacDonald; el Fiscal Federal para el Distrito Central de Illinois, John C. Milhiser; el Fiscal General Auxiliar de la División de Derechos Civiles, Eric S. Dreiband; y la Agente Especial Encargada de la División del FBI en Minneapolis, Jill Sanborn, anunciaron hoy las declaraciones de culpabilidad.

«Los acusados cometieron una serie de delitos violentos sin precedentes en múltiples estados que aterrorizaron comunidades, entre ellos los miembros del Centro Islámico Dar al-Farooq en Minnesota. Los actos delictivos de los acusados son reprehensibles y antitéticos a nuestros valores como nación. Cada individuo tiene derecho a vivir libre de la amenaza de violencia y discriminación, no importa quién es, en qué creen o dónde rezan», declaró la Fiscal Federal Erica H. MacDonald. «La dedicación y colaboración de nuestras agencias asociadas de orden público en varias jurisdicciones para llevar a estos acusados ante la justicia es un poderoso ejemplo de nuestra devoción a la búsqueda de justicia para toda víctima y al enjuiciamiento, con todo el peso de la ley, de cualquier individuo que intente amenazar los derechos civiles de otro mediante la comisión de delitos de odio tan viles».

«Seguiremos trabajando con nuestras agencias federales y estatales asociadas para identificar y enjuiciar a grupos peligrosos y radicales que elijan aterrorizar a nuestras comunidades», afirmó el Fiscal Federal John C. MilHeiser.

«Todas las personas merecen vivir libres de violencia y miedo, independientemente de religión o lugar de culto», comentó el Fiscal General Auxiliar de la División de Derechos Civiles, Eric Dreiband. «El Departamento de Justicia se ha comprometido a hacer que los autores de delitos de odio rindan cuentas ante la ley de sus acciones delictivas y peligrosas, cometidas contra miembros inocentes de la comunidad».

«Este delito no solo fue un ataque contra el objetivo pretendido, sino que tuvo la intención de amenazar e intimidar a una comunidad entera. Debido a ese enorme impacto, la investigación de este delito y de otros parecidos es una de las prioridades principales del FBI», dijo Jill Sanborn, la Agente Especial Encargada de la División del FBI en Minneapolis. «El FBI tiene el deber de defender los derechos civiles y nuestros agentes en las oficinas locales en Minneapolis y Springfield, juntos con el Equipo de Tarea Conjunta contra el Terrorismo, investigaron este caso rápidamente en cooperación con la Agencia de Control de Bebidas Alcohólicas, Tabaco, Armas de Fuego y Explosivos (ATF, por sus siglas en inglés), la Policía de Bloomington y otras agencias del orden público asociadas con una única meta: llevar a los terroristas ante la justicia y, más importante aún, ayudar a la comunidad de Dar al-Farooq a empezar a sentirse segura nuevamente».

Los acusados McWhorter y Morris se declararon culpables en el Distrito de Minnesota ante cargos federales que se habían originado en el Distrito de Minnesota y el Distrito Central de Illinois. Las declaraciones ante los cargos que se originaron en el Distrito Central de Illinois se declararon en Minnesota, conforme a la Norma Federal 20 de Procedimiento Penal, que permite la transferencia de cargos para declaraciones de culpabilidad y la imposición de la condena. McWhorter, Morris y su coacusado Michael Hari, de 47 años, fueron acusados formalmente de poseer una ametralladora, de confabular a interferir en el comercio mediante amenazas y violencia (la ley de Hobbs) y de intentar a provocar un incendio, en una acusación formal sustitutiva del 2 de mayo del 2018 en el Distrito Central de Illinois. McWhorter, Morris y Hari fueron acusados formalmente en el Distrito de Minnesota el 21 de junio del 2018 ante cargos federales de derechos civiles y de posesión y uso de un dispositivo destructivo en apoyo de un delito federal de odio.

McWhorter y Morris se declararon culpables hoy ante el Juez Superior del Tribunal Federal de Distrito Donovan Frank. El acusado Hari sigue bajo custodia en el Distrito Central de Illinois.[1]

Según las declaraciones de culpabilidad de McWhorter y Morris, durante el verano del 2017, Michael Hari organizó un grupo de milicianos en el centro de Illinois, el que finalmente fue llamado los «White Rabbits» [Conejos Blancos], al que se unieron McWhorter y Morris, junto con otros individuos adicionales.

Conforme a las declaraciones de culpabilidad de McWhorter y Morris y documentos presentados ante el tribunal, el 4 y el 5 de agosto del 2017, McWhorter, Morris y Hari manejaron un camión alquilado desde Illinois hasta el Centro Islámico de Dar al-Farooq («DAF») en Bloomington, Minnesota. Dejaron atrás sus teléfonos celulares en Illinois y evitaron las autopistas de peaje en un intento de pasar desapercibidos. Los acusados pararon en su ruta para comprar diésel y gasolina, lo que Hari mezcló en un contenedor de plástico. A una hora de Minnesota, Hari divulgó a McWhorter y Morris que tenía una bomba de fabricación casera en el camión (que se había creado con materiales comprados previamente) y que iban a bombardear una mezquita.

Tal y como McWhorter y Morris admitieron en las audiencias en las que se declararon culpables, ellos dos, juntos con Hari, llegaron al Centro Islámico DAF aproximadamente a las 5 de la madrugada el 5 de agosto del 2017. Morris empleó un mazo para romper una ventana del Centro Islámico DAF y tiró adentro de edificio el contenedor de plástico que contenía la mezcla de diésel y gasolina. McWhorter encendió la mecha de la bomba de fabricación casera que Hari había construido y tiró la bomba la fabricación casera por la ventana rota del Centro Islámico DAF. Según los documentos judiciales, la ventana rota estaba en la oficina del Imam del Centro Islámico DAF. Cuando la bomba de fabricación casera explotó, se encendió la mezcla en el contenedor de plástico, lo cual provocó daños sustanciales por fuego y humo a la oficina del Imam, junto con daños por agua causados cuando se activó el sistema de aspersores del edificio. McWhorter y Morris volvieron corriendo al camión, donde Hari les esperaba en el asiento del conductor, y volvieron a Illinois. En el momento de la explosión, estaban presentes en la mezquita congregantes que habían acudido a las oraciones matinales. No obstante, la oficina del Imam estaba desocupada, por lo que el bombardeo no causó víctimas mortales o lesiones.

Según sus declaraciones de culpabilidad, Hari había elegido el Centro Islámico DAF por ser un lugar de culto musulmán. McWhorter y Morris admitieron que el bombardeo fue un intento de espantar a los musulmanes y hacerles creer que no son bienvenidos en los Estados Unidos y que deben abandonar el país. Por otra parte, los acusados también declararon que su objetivo fue el Centro Islámico DAF porque los tres creían que estaba lo suficiente lejos del centro de Illinois por lo que era poco probable que los sospecharían del ataque.

Como parte de sus declaraciones de culpabiliad, McWhorter y Morris admitieron que participaron en la invasión armada de un hogar en Ambia, Indiana, el 16 de diciembre del 2017, donde ellos, fingiendo ser policías, llevaban armas, entre ellos dos que se habían convertido ilegalmente en ametralladoras. McWhorter y Morris también llevaron a cabo, juntos con Hari, robos a mano armada de dos sucursales de Wal-Mart, una en Watseka, Illinois y otro en Mt. Vernon, Illinois, el 2 de diciembre del 2017 y el 17 de diciembre del 2017, respectivamente.

McWhorter y Morris también admitieron que, juntos con el coacusado Hari, intentaron prender fuego a una clínica de salud de mujeres que se llama Women’s Health Practice en Champaign, Illinois, el 7 de noviembre del 2017. Morris admitió que había roto un cristal y colocado un dispositivo incendiario en Women’s Health Practice y que había encendido una tira de magnesio que se estaba utilizando como mecha. No obstante, el dispositivo no se encendió y fue encontrado en el suelo por un empleado de Women’s Health Practice al llegar esa mañana a su trabajo.

El Buró Federal de Investigaciones está encabezando la investigación.

Los Fiscales Federales Auxiliares para el Distrito Minnesota, John Docherty y Julie E. Allyn, con la ayuda del Abogado de Litigios Timothy Visser, de la División de Derechos Civiles, son responsables del enjuiciamiento de este caso. El equipo también trabajo estrechamente con el Fiscal Federal Auxiliar Eugene Miller de la Fiscalía Federal para el Distrito Central de Illinois.

Información sobre los acusados:

MICHAEL MCWHORTER, 29 años

Clarence, Illinois

Condenado:

• Impedir intencionalmente e intentar impedir, mediante la fuerza y amenazas de fuerza, el libre ejercicio de creencias religiosas, 1 cargo
• Portar y emplear un dispositivo destructivo durante y en relación con la comisión de delitos de violencia, 1 cargo
• Posesión de una ametralladora, 1 cargo
• Confabular a interferir en el comercio mediante amenazas y violencia, 1 cargo
• Intento de provocar un incendio, 1 cargo

 
JOE MORRIS, 23 años

Clarence, Illinois

Condenado:

• Impedir intencionalmente e intentar impedir, mediante la fuerza y amenazas de fuerza, el libre ejercicio de creencias religiosas, 1 cargo
• Portar y emplear un dispositivo destructivo durante y en relación con la comisión de delitos de violencia, 1 cargo
• Posesión de una ametralladora, 1 cargo
• Confabular a interferir en el comercio mediante amenazas y violencia, 1 cargo
• Intento de provocar un incendio, 1 cargo

 
MICHAEL HARI, 47 años

Clarence, Illinois

Cargos en el Distrito de Minnesota:

• Intencionalmente desfigurar, dañar y destrozar bienes inmuebles religiosas por motivos del carácter religioso de tales bienes, 1 cargo
• Impedir intencionalmente e intentar impedir, mediante la fuerza y amenazas de fuerza, el libre ejercicio de creencias religiosas, 1 cargo
• Confabular a cometer delitos graves federales mediante el uso de incendios y explosivos, 1 cargo
• Portar y emplear un dispositivo destructivo durante y en relación con la comisión de delitos de violencia, 1 cargo
• Posesión de un dispositivo destructivo no registrado, 1 cargo

Cargos en el Distrito Central de Illinois [2]:

• Posesión de una ametralladora, 1 cargo
• Confabular a interferir en el comercio mediante amenazas y violencia, 1 cargo
• Intento de provocar un incendio, 1 cargo
• Posesión por un delincuente de un arma de fuego, 1 cargo

###

Para más noticias vaya a nuestro sitio web.

Síganos en Twitter y Facebook.

Fiscalía Federal, Distrito de Minnesota: (612) 664-5600

[1] Los cargos contra el acusado Michael Hari son acusaciones, y se lo considera inocente mientras no se pruebe su culpabilidad.

[2] La acusación formal sustitutiva agrega cargos nuevos contra cuatro hombres del centro de Illinois

Skadden, Arps, Slate, Meagher & Flom LLP has entered into a settlement agreement with the Department of Justice, resolving its liability for violations of the Foreign Agents Registration Act (FARA), announced Assistant Attorney General for National Security John Demers.

According to the Agreement, Skadden acted as an agent of the Government of Ukraine within the meaning of FARA, 22 U.S.C. § 611 et seq., by contributing to a public relations campaign directed at select members of the U.S. news media in 2012.  Moreover, in 2012 and 2013, Skadden received multiple inquiries from the Department’s FARA Registration Unit about its role in that campaign. A partner then at Skadden made false and misleading statements to the FARA Unit, which led it to conclude in 2013 that the firm was not obligated to register under FARA. The facts, when uncovered, showed that Skadden was indeed required to register in 2012, and, under the Agreement, it will do so retroactively.

“Law firms should handle inquiries from the federal government the same way they would counsel their clients to: with appropriate due diligence to ensure the honesty of their response,” said Assistant Attorney General Demers.  “Skadden’s failure to do so, and reliance on only the representations of the lead partner on the matter, hid from the public that its report was part of a Ukrainian foreign influence campaign.  FARA protects the integrity of the American political system by enabling Americans to consider the identity of the speaker as they evaluate the substance of the speech.”  Assistant Attorney General Demers added, “The Department appreciates Skadden’s more recent extensive cooperation in the investigation of this matter, which facilitated its resolution.” 

In addition to agreeing to register under FARA, Skadden has agreed to pay the U.S. Treasury more than $4.6 million, which it received in fees and expenses for its work with Ukraine, and will ensure that it has formal, robust procedures for responding to inquiries concerning its conduct from any federal government entity and ensuring FARA compliance as to its engagements on behalf of foreign clients.

The Agreement acknowledges that Skadden has already taken substantial steps to comply with its terms, and so long as the firm continues to comply with it, the Department will not undertake any action against the firm relating to any of the conduct described in the Agreement and its Appendix.

Background of the Investigation

According to the Agreement, in the spring of 2012, Ukraine, Ministry of Justice (MOJ), with the assistance of Paul Manafort, hired Skadden to write a report (Report) on the evidence and procedures used during the 2011 prosecution and trial of former Prime Minister Yulia Tymoshenko and to address various questions regarding its fairness.  Skadden also agreed to advise Ukraine in connection with a second, potential future prosecution of Tymoshenko.  Although the engagement letter between Skadden and the MOJ stated that Skadden would be paid its customary fees and expenses, the contract Skadden signed with the MOJ, and which the MOJ made public, stated that the law firm would be paid only 95,000 Ukrainian hryvynas, which is approximately $12,000.  Skadden understood that a Ukrainian business person would be paying its fees, which the law firm received from a Cypriot bank account of an entity named Black Sea View Ltd., which Manafort controlled.  Skadden was eventually paid $4,657,568.91 for its work on behalf of the MOJ.  The arrangements with the Ukrainian business person, the amounts paid, and advice on a second criminal prosecution of Tymoshenko were not disclosed in connection with the issuance of the Report.

Soon after it began work for the MOJ, Skadden became aware that Ukraine intended to use the Report as part of a public relations campaign to influence U.S. policy and public opinion toward Ukraine.  After that point, Skadden’s lead partner for the Ukraine engagement took steps to advance the public relations campaign.  In the fall of 2012, shortly after a meeting in New York with Manafort and a representative from Ukraine’s public relations firm to finalize the Report and discuss the media strategy for its rollout, the lead partner contacted a journalist at a national newspaper and asked whether the journalist would take a call from a lobbyist for Ukraine about the Report in advance of its release.  Then, shortly before Ukraine released the report on December 13, 2012, the lead partner again contacted the journalist and arranged for delivery of the Report to the journalist, both via email and in person.  On December 12, 2012, the lead partner spoke with the national newspaper about the Report and provided a quotation for attribution. 

The lead partner’s pre-release outreach to the journalist was consistent with Ukraine’s media strategy for the Report, which including leaking the Report prior to its official release so as to “effectively set the agenda for subsequent coverage.”

FARA requires those in the U.S. who engage in political activities on behalf of foreign principals, which include foreign governments, to make a variety of written public disclosures to the Department of Justice.  Based on its awareness of and involvement in Ukraine’s public relations campaign, Skadden had an obligation to register with the Department of Justice under FARA, but it failed to do so.  If Skadden had registered, it would have had to disclose, among other things, the full amount it was being paid, the source of those payments, and the full scope of the work it was doing on behalf of the MOJ.

Five days after news articles appeared about the Report, the FARA Unit sent Skadden a letter, seeking information about its activities on behalf of Ukraine in order to assist the FARA Unit in determining whether Skadden had a registration obligation.  This was the first of several requests for information the FARA Unit made to Skadden. 

In both written and oral responses to the FARA Unit between February 6, 2013, and October 11, 2013, Skadden, in reliance on the lead partner, made false and misleading statements including, among other things, that Skadden provided a copy of the Report only in response to requests from the media and spoke to the media to correct misinformation about the report that the media was already reporting.  The firm also submitted documents to the FARA unit that were false.

The FARA Unit made a determination that Skadden did not have a registration obligation in connection with its work for Ukraine, and it based that conclusion on the false and misleading information Skadden had provided.  Before making its representations to the FARA Unit, Skadden had conducted no investigation to confirm the information the lead partner was providing to the FARA Unit and to other partners at the firm.

The investigation and negotiation of the Agreement was handled by Jason B.A. McCullough, a Trial Attorney in the Counterintelligence and Export Control Section, which includes the FARA Registration Unit, with assistance from the Federal Bureau of Investigation’s Counterintelligence Division.

In the January 15, 2019 memorandum to all U.S. Attorneys, the Deputy Attorney General set a 90-day grace period on implementing the Office of Legal Counsel's (OLC) new opinion during which federal prosecutors should not apply the Wire Act to non-sports-related betting or wagering.  This 90-day grace period will allow anyone affected to review the opinion and bring their gambling-related operations into compliance, if necessary.  The Deputy Attorney General also indicated that, to ensure continuity across the country, any Wire Act charges must be reviewed and approved by the Criminal Division’s Organized Crime and Gang Section.  This new review-and-approval requirement will be codified in the Justice Manual. 

The Department of Justice, the Environmental Protection Agency (EPA) and the State of California announced today a settlement with Fiat Chrysler Automobiles N.V., FCA US, and affiliates (Fiat Chrysler) for alleged violations of the Clean Air Act and California law. Fiat Chrysler has agreed to implement a recall program to repair more than 100,000 noncompliant diesel vehicles sold or leased in the United States, offer an extended warranty on repaired vehicles, and pay a civil penalty of $305 million to settle claims of cheating emission tests and failing to disclose unlawful defeat devices. Fiat Chrysler also will implement a program to mitigate excess pollution from these vehicles.  The recall and federal mitigation programs are estimated to cost up to approximately $185 million. In a separate settlement with California, Fiat Chrysler will pay an additional $19 million to mitigate excess emissions from more than 13,000 of the noncompliant vehicles in California. In addition, in a separate administrative agreement with the United States Customs and Border Protection, Fiat Chrysler will pay a $6 million civil penalty to resolve allegations of illegally importing 1,700 noncompliant vehicles.

The Environmental Protection Agency and California settlement (EPA/California Settlement) resolves claims of EPA and California relating to Fiat Chrysler’s use of defeat devices to cheat emission tests. Defeat devices are design elements (in this case software functions) installed in vehicles that reduce the effectiveness of the emission control system during normal on-road driving conditions. The affected vehicles are model year 2014 through 2016 Ram 1500 and Jeep Grand Cherokee vehicles equipped with “EcoDiesel” 3.0 liter engines.

Today’s settlement does not resolve any potential criminal liability. The settlement also does not resolve any consumer claims or claims by individual owners or lessees who may have asserted claims in the ongoing multidistrict litigation. In addition to its separate settlement addressing excess emissions for affected vehicles in California, the state of California has also entered into another separate settlement with Fiat Chrysler resolving alleged violations of California consumer protection laws relating to the affected vehicles.

“The Department of Justice is committed to the full and fair enforcement of the laws that protect our nation’s environment,” said Principal Deputy Associate Attorney General Jesse Panuccio. “Fiat Chrysler broke those laws and this case demonstrates that steep penalties await corporations that engage in such egregious violations.  Assistant Attorney General Jeff Clark, and his team in the Environment and Natural Resources Division, are to be commended for  securing significant relief in this case for the American people.”

“Fiat Chrysler deceived consumers and the federal government by installing defeat devices on these vehicles that undermined important clean air protections,” said EPA Acting Administrator Andrew Wheeler. “Today’s settlement sends a clear and strong signal to manufacturers and consumers that EPA will vigorously enforce the nation’s laws designed to protect the environment and public health.”

As alleged in the civil complaint filed by the United States Justice Department on behalf of EPA on May 23, 2017, Fiat Chrysler equipped over 100,000 EcoDiesel Ram 1500 and Jeep Grand Cherokee vehicles (Model Years 2014-2016) sold in the United States with illegal and undisclosed software that causes the emission control system to operate differently during emission control tests than when it is driven on the road. When the vehicle is being tested for compliance with EPA or California emission standards, the software activates full emission controls. In contrast, during real world driving, the software features reduce or deactivate emission controls, reducing the effectiveness of the vehicles’ emission control systems. The United States alleged that one or more of these software features, as configured in Fiat Chrysler’s vehicles, are defeat devices. The result is vehicles that meet emission standards during standard regulatory testing, but that emit air pollutants, including oxides of nitrogen (NOx), at a higher rate when the vehicles are on the road, much higher than the EPA and California emission standards allow. NOx pollution contributes to harmful ground-level ozone and fine particulate matter, pollutants associated with a range of serious health effects, including asthma attacks, respiratory illnesses, and other respiratory-related or cardiovascular-related effects, including damage to lung tissue and premature death.

EPA discovered these defeat devices in Fiat Chrysler’s vehicles during vehicle emission testing EPA performed in 2015 and 2016 at the National Vehicle and Fuel Emissions Laboratory (NVFEL).

Recall Program and Corporate Reforms

The EPA/California Settlement requires Fiat Chrysler to implement a recall and repair program to remove all defeat devices in the vehicles and replace the vehicles’ software so that they comply with EPA and California emission standards. Fiat Chrysler tested vehicles with the new software and demonstrated to EPA and California that the repaired vehicles will meet the applicable emission standards. EPA and California also tested the repaired vehicles and determined that they perform the same on emission tests as they do under normal driving conditions. Fiat Chrysler must repair at least 85% of the vehicles within two years or face stiff penalties. Fiat Chrysler must offer an extended warranty for vehicles that are repaired. Fiat Chrysler also must test repaired vehicles for five years to ensure the vehicles continue to meet emission standards over time and will pay additional penalties if the vehicles fail to meet those standards. 

The settlement further requires Fiat Chrysler to implement corporate governance, organizational and technical process reforms to minimize the likelihood of future Clean Air Act violations, and to hire a compliance auditor for three years to oversee and assess the effectiveness of these reforms.

Mitigation Program

The EPA/California Settlement requires Fiat Chrysler to implement a federal mitigation program to offset the environmental impacts of the non-compliant vehicles by reducing NOx emissions in the atmosphere. Fiat Chrysler will be required to work with one or more vendors of aftermarket catalytic converters to improve the efficiency of 200,000 converters that will be sold in the 47 states that do not already require the use of the California-mandated high efficiency gasoline vehicle catalysts. Such converters are purchased by vehicle owners to replace out-of-warranty catalytic converters. The mitigation program under the EPA/California Settlement is expected to fully mitigate NOx emissions caused by Fiat Chrysler’s violations across the country outside of California. The State of California’s separate mitigation program will fully address excess NOx from affected vehicles in California.

Additional Settlement

The Plaintiffs’ Steering Committee has secured a settlement for consumers with FCA and Bosch. Class members will receive between $990 and $3,075—an aggregate value of over $300 million if all class members participate—plus an extended warranty and an emissions fix also provided for in the EPA/California Settlement. Under California's separate consumer settlement, FCA also must provide consumers with the relief contained in the PSC agreement. For more information, consumers can go to EcoDieselSettlement.com or call FCA at 1-833-280-4748.

EPA/California Settlement Consent Decree

The EPA/California Settlement Consent Decree will be lodged in federal court in the Northern District of California and there will be a period of 30 days for public notice and comment. The penalty is due within 30 days of the court’s entry of the Consent Decree.

For more information on the settlement visit: https://www.epa.gov/enforcement/fiat-chrysler-automobiles-clean-air-act-civil-settlement-information-sheet

NOTE: The consent decree can be found here: https://www.justice.gov/enrd/consent-decree/file/1123866/download#Consent Decree with Attachments A - F  

The Department of Justice’s Civil Rights Division and the U.S. Equal Employment Opportunity Commission (EEOC) today signed a new Memorandum of Understanding (MOU) to prevent and address workplace harassment in state and local government. The EEOC and the Justice Department seek to enhance the effectiveness of the nation’s equal employment opportunity enforcement in the state and local government sector to ensure the efficient use of resources and a consistent enforcement strategy. The EEOC has ramped up its role as enforcer, educator, and leader on harassment in the workplace, and this MOU enhances those efforts.

EEOC Acting Chair Victoria A. Lipnic and Assistant Attorney General Eric Dreiband signed the MOU on Dec. 21 in Washington, D.C.

“All Americans are entitled to work with dignity in a place that is free of unlawful and discriminatory harassment,” said Assistant Attorney General Eric Dreiband. “Last February, the Justice Department’s Civil Rights Division launched an initiative to fight sexual harassment in the workplace. We are also diligently working to prosecute cases of racial and other forms of illegal discrimination. Through our strong partnership with the EEOC, we will continue to identify harassment claims, prosecute lawbreakers, seek relief for victims, and fight to eliminate harassment from the workplace.”

“I am pleased to be able to renew our work with the Department of Justice in this regard,” said Acting Chair Lipnic. “Harassment at work can have a devastating impact on people. The employees in the public sector deserve as much of our attention on this issue as those in the private sector.” Lipnic added, “I especially want to thank EEOC Commissioner Charlotte Burrows for her attention to issues in this sector. I look forward to using her years of experience at the Department of Justice to help us move forward with our important work.”

EEOC Commissioner Charlotte A. Burrows stated, “Anyone who suffers workplace harassment deserves prompt relief. I commend Acting Chair Lipnic and Assistant Attorney General Dreiband for their leadership in taking this important step to enhance the federal response in harassment investigations.”

The EEOC and the Department of Justice share enforcement authority for employment discrimination claims involving state and local government employers under Title VII of the Civil Rights Act. The EEOC receives, investigates, and mediates charges of discrimination against such public employers. Where the EEOC finds reasonable cause to believe an unlawful employment practice has occurred, the agency works with the employer to negotiate a mutually agreeable resolution to the charge. If conciliation of a charge fails, the EEOC refers the charge and its investigative file to the Justice Department, which has sole authority within the federal government to file a lawsuit against state and local governments under Title VII.

The agencies’ shared concern over the need for immediate action to prevent further harm in some harassment cases, including sexual harassment, led the EEOC and the Justice Department to amend the MOU. It now includes provisions for the expedited coordination of any charge involving state or local government employers where the EEOC’s preliminary investigation of a charge reveals that immediate action is needed to prevent further harm. In those cases, the EEOC will provide the Justice Department with the information necessary to obtain an injunction, temporary or preliminary relief, in federal court for the affected employees, pending the final outcome of the charge. 

The MOU and information about Title VII and other federal employment laws is available on the Employment Litigation Section of the Civil Rights Division’s website or the EEOC’s website.

The EEOC advances opportunity in the workplace by enforcing federal laws prohibiting employment discrimination. More information is available at www.eeoc.gov. Stay connected with the latest EEOC news by subscribing to our email updates.

NOTE: The 2018 False Claims Act statistics can be found here.

The Department of Justice obtained more than $2.8 billion in settlements and judgments from civil cases involving fraud and false claims against the government in the fiscal year ending Sept. 30, 2018, Principal Deputy Associate Attorney General Jesse Panuccio and Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division announced today.  Recoveries since 1986, when Congress substantially strengthened the civil False Claims Act, now total more than $59 billion.

“Every year, the submission of false claims to the government cheats the American taxpayer out of billions of dollars,” said Principal Deputy Associate Attorney General Panuccio. “In some cases, unscrupulous actors undermine federal healthcare programs or circumvent safeguards meant to protect the public health.  In other instances, deceitful contractors overcharge our military or sell faulty equipment to our law enforcement agencies.  Such fraud will not be tolerated by the Department of Justice.  The nearly three billion dollars recovered by the Civil Division represents the Department’s continued commitment to fighting fraudsters and cheats on behalf of the American taxpayer.”

“The False Claims Act was originally passed in response to rampant fraud perpetrated against the United States military during the Civil War. Back then, crooked contractors defrauded the Union Army by selling it sick mules, lame horses, sawdust instead of gunpowder, and rotted ships with fresh paint.  Unfortunately, what we see today is just a modern version of the same thing — deceptive and fraudulent practices directed at the U.S. government and the American taxpayer,” said Assistant Attorney General Jody Hunt. “The Department of Justice has placed a high priority on rooting out and pursuing those who cheat government programs for their own gain. The recoveries announced today are a message that fraud and dishonesty will not be tolerated.”

Of the $2.8 billion in settlements and judgments recovered by the Department of Justice this past fiscal year, $2.5 billion involved the health care industry, including drug and medical device manufacturers, managed care providers, hospitals, pharmacies, hospice organizations, laboratories, and physicians.  This is the ninth consecutive year that the Department’s civil health care fraud settlements and judgments have exceeded $2 billion.  The recoveries included in the $2.5 billion reflect only federal losses but, in many of these cases, the Department was instrumental in recovering additional millions of dollars for state Medicaid programs.

In addition to combatting health care fraud, the False Claims Act serves as the government’s primary civil remedy to redress false claims for federal funds and property involving a multitude of government operations and contracts.  These areas range from defense and national security to import tariffs and small business programs. 

In 1986, Congress strengthened the Act by increasing incentives for whistleblowers to file lawsuits alleging false claims on behalf of the government.  These whistleblower, or qui tam, actions comprise a significant percentage of the False Claims Act cases that are filed.  If the government prevails in a qui tamaction, the whistleblower, also known as the relator, receives up to 30 percent of the recovery.  Whistleblowers filed 645 qui tam suits in fiscal year 2018, and this past year the Department recovered over $2.1 billion in these and earlier filed suits. 

Health Care Fraud

The Department investigates and resolves matters involving a wide array of health care providers, goods, and services.  The Department’s health care fraud enforcement efforts recover money for federal programs that fund health care for our nation’s most vulnerable and deserving citizens, such as Medicare, Medicaid, and TRICARE.  But just as important, the Department’s vigorous pursuit of health care fraud prevents billions more in losses by deterring those who might otherwise try to cheat the system for their own gain.

The largest recoveries involving the health care industry this past year came from the drug and medical device industry.  In one matter, AmerisourceBergen Corporation and certain of its subsidiaries paid $625 million to resolve allegations that they sought to circumvent important safeguards intended to preserve the integrity of the nation’s drug supply and profit from the repackaging of certain drugs supplied to cancer-stricken patients. Of that amount, $581.8 million was paid to the federal government and $43.2 million was paid to state Medicaid programs.   https://www.justice.gov/opa/pr/amerisourcebergen-corporation-agrees-pay-625-million-resolve-allegations-it-illegally.  In another matter, the medical device manufacturer Alere paid $33.2 million to resolve allegations that it sold a materially unreliable testing device that was intended to aid clinicians in the diagnosis of drug overdoses, acute coronary syndrome and other serious conditions.  Of the $33.2 million paid by Alere, $28.4 million was returned to the federal government and $4.8 million was returned to state Medicaid programs.  https://www.justice.gov/opa/pr/alere-pay-us-332-million-settle-false-claims-act-allegations-relating-unreliable-diagnostic. 

The Department has investigated efforts by drug manufacturers to facilitate increases in drug prices by funding the co-payments of Medicare patients. Congress included co-pay requirements in the Medicare program, in part, to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs.  This year, pharmaceutical company United Therapeutics Corporation, a seller of pulmonary arterial hypertension (PAH) drugs, paid $210 million to resolve allegations that it used a foundation as an illegal conduit to pay the co-pay obligations of thousands of Medicare patients taking its PAH drugs.  https://www.justice.gov/usao-ma/pr/united-therapeutics-agrees-pay-210-million-resolve-allegations-it-paid-kickbacks-through.  In addition, the drug manufacturer Pfizer paid approximately $23.85 million to resolve claims that it used a foundation as a conduit to pay the co-pays of Medicare patients taking Pfizer drugs.  The government alleged that Pfizer raised the price of one of those drugs by 40 percent in just three months.  https://www.justice.gov/opa/pr/drug-maker-pfizer-agrees-pay-2385-million-resolve-false-claims-act-liability-paying-kickbacks.

The Department also reported substantial recoveries from other health care providers.  In a matter that came to light in part by a voluntary disclosure by the company to the Department, HealthCare Partners Holdings LLC (HCP), doing business as DaVita Medical Holdings LLC, paid $270 million to resolve its liability for providing inaccurate information that caused Medicare Advantage Organizations (MAOs) to receive inflated Medicare payments. DaVita acquired HCP, a large California-based independent physician association, in 2012 and disclosed to the government various improper practices that were instituted by HCP.  In addition, this settlement resolved whistleblower allegations that HCP engaged in “one-way” chart reviews in which it scoured its patients’ medical records to find additional diagnoses that enabled managed care plans to obtain added revenue from the Medicare program. At the same time, however, it ignored inaccurate diagnosis codes revealed by its reviews that, if deleted, would have decreased Medicare reimbursement or required the plans to repay money to Medicare.  https://www.justice.gov/opa/pr/medicare-advantage-provider-pay-270-million-settle-false-claims-act-liabilities.  In 2017, the Department filed suit against UnitedHealth Group Inc. (UHG) alleging similar allegations that UHG knowingly obtained inflated risk adjustment payments based on untruthful and inaccurate information about the health status of beneficiaries enrolled in UHG’s Medicare Advantage Plans throughout the United States.  https://www.justice.gov/opa/pr/united-states-intervenes-second-false-claims-act-lawsuit-alleging-unitedhealth-group-inc. That litigation is ongoing.

In a matter that concluded in both a civil recovery and criminal plea, the former hospital chain Health Management Associates (HMA) paid over $216 million to resolve civil allegations that it billed government health care programs for more-costly inpatient services that should have been billed as observation or out-patient services, paid illegal remuneration to physicians in return for patient referrals to HMA hospitals, and inflated claims for emergency department facility fees.  In addition to these civil recoveries, HMA’s subsidiary, Carlisle HMA Inc., pleaded guilty to one count of conspiracy to commit health care fraud arising from illegal conduct designed to aggressively increase admissions to the hospital and paid a $35 million monetary penalty.  https://www.justice.gov/opa/pr/hospital-chain-will-pay-over-260-million-resolve-false-billing-and-kickback-allegations-one.  In another matter, William Beaumont Hospital, a regional hospital system based in the Detroit, Michigan area, paid $84.5 million to resolve allegations of improper relationships with eight referring physicians intended to induce patient referrals. https://www.justice.gov/opa/pr/detroit-area-hospital-system-pay-845-million-settle-false-claims-act-allegations-arising.

As some of the matters described illustrate, the Department continued to place great importance on enforcing the safeguards contained within the Anti-Kickback Statute (AKS).  This law was enacted to ensure that clinical decisions and medical services are provided to patients based on their medical needs and not on the improper financial considerations of providers. Congress has made clear that claims submitted to federal health care programs in violation of the AKS are “false” claims for purposes of the False Claims Act.

Procurement Fraud

In the past year, the Department also pursued a variety of fraud matters involving the government’s purchase of goods and services.  Toyobo Co. Ltd. of Japan and its American subsidiary, Toyobo U.S.A. Inc., f/k/a Toyobo America Inc. (collectively, Toyobo), paid $66 million to resolve claims that they sold defective Zylon fiber used in bullet proof vests that the United States purchased for federal, state, local, and tribal law enforcement agencies.  The United States further alleged that between at least 2001 and 2005, Toyobo, the sole manufacturer of Zylon fiber, knew that Zylon degraded quickly in normal heat and humidity and that this degradation rendered bullet proof vests containing Zylon unfit for use.  The United States alleged that Toyobo nonetheless actively marketed Zylon fiber for bullet proof vests, published misleading data that understated the degradation problem and, when one body armor manufacturer recalled some of its Zylon-containing vests in late 2003, started a public relations campaign designed to influence other body armor manufacturers to keep selling Zylon-containing vests.  Toyobo’s actions allegedly delayed by several years the government’s efforts to determine the true extent of Zylon degradation.  Finally, in August 2005, the National Institute of Justice (NIJ) completed a study of Zylon-containing vests and found that more than 50 percent of used vests could not stop bullets that they had been certified to stop.  Thereafter, all Zylon-containing vests were decertified for use.  With this year’s Toyobo settlement, more than $132 million has been recovered by the Department in False Claims Act matters involving the manufacture, distribution or sale of Zylon by body armor manufacturers, weavers, and international trading companies. https://www.justice.gov/opa/pr/japanese-fiber-manufacturer-pay-66-million-alleged-false-claims-related-defective-bullet.

United Kingdom marine services contractor, Inchcape Shipping Services Holdings Limited, and certain of its subsidiaries paid $20 million to resolve allegations that they overbilled the U.S. Navy under contracts to provide services to Navy ships at ports in several regions throughout the world, including southwest Asia, Africa, Panama, North America, South America and Mexico.  In its suit, the government alleged that Inchcape knowingly overbilled the Navy by submitting invoices that overstated the quantity of goods and services provided, billing at rates in excess of applicable contract rates, and double-billing for some goods and services. https://www.justice.gov/opa/pr/united-states-settles-lawsuit-alleging-contractor-falsely-overcharged-us-navy-ship-husbanding.

In another matter, TrellisWare Technologies Inc., a communications company located in San Diego, California, paid over $12 million to settle allegations that it was ineligible for multiple Small Business Innovation and Research (SBIR) contracts it had entered into with the Navy, Army, and Air Force.  The SBIR program is designed to stimulate technological innovation by funding small businesses to engage in federal research and development efforts.  The United States alleged that TrellisWare was not eligible for SBIR awards because it was actually a majority-owned subsidiary of a large company at the time it was awarded and performed the SBIR contracts.  https://www.justice.gov/usao-sdca/pr/san-diego-communications-company-pays-more-12-million-settle-false-claim-act.

In addition, 3M Company, headquartered in St. Paul, Minnesota, paid $9.1 million to resolve allegations that it knowingly sold dual-ended Combat Arms Earplugs to the United States military without disclosing defects that hampered the effectiveness of the hearing protection device.  https://www.justice.gov/opa/pr/3m-company-agrees-pay-91-million-resolve-allegations-it-supplied-united-states-defective-dual.

Other Fraud Recoveries

The number and variety of judgments and settlements announced during fiscal year 2018 illustrate the diversity of fraud cases pursued by the Department. For example, in February 2018, Deloitte & Touche LLP agreed to pay $149.5 million to resolve potential False Claims Act liability arising from Deloitte’s role as the independent outside auditor of Taylor, Bean & Whitaker Mortgage Corp. (TBW), a failed originator of mortgage loans insured by the Federal Housing Administration (FHA) in the Department of Housing and Urban Development (HUD).  Deloitte served as TBW’s independent outside auditor during the time TBW had been engaged in a long-running fraudulent scheme involving, among other things, the purported sale of fictitious or double-pledged mortgage loans.  The United States alleged that Deloitte’s audits knowingly deviated from applicable auditing standards and therefore failed to detect TBW’s fraudulent conduct and materially false and misleading financial statements.  https://www.justice.gov/opa/pr/deloitte-touche-agrees-pay-1495-million-settle-claims-arising-its-audits-failed-mortgage. 

The False Claims Act was also used this past year to redress avoidance of antidumping duties that are in place to protect against foreign companies “dumping” products on the U.S. market at prices below cost.  The Department of Commerce assesses, and the Department of Homeland Security’s Customs and Border Protection collects, these duties to protect U.S. businesses and level the playing field for domestic products.  This year, the Virginia-based home furnishings company, Bassett Mirror Company, paid $10.5 million to resolve allegations that it knowingly made false statements on customs declarations to avoid paying antidumping duties on wooden bedroom furniture imported from the People’s Republic of China (PRC).  The Department alleged that between January 2009 and February 2014, Bassett Mirror evaded these antidumping duties by knowingly misclassifying the furniture as non-bedroom furniture on its official import documents.  At the time of the alleged conduct in this case, wooden bedroom furniture from the PRC was subject to a 216 percent antidumping duty; non-bedroom furniture was not subject to an antidumping duty. https://www.justice.gov/opa/pr/bassett-mirror-company-agrees-pay-105-million-settle-false-claims-act-allegations-relating. Similarly, textile importer American Dawn Inc. agreed to pay over $2.3 million to resolve allegations that it intentionally misclassified goods imported into the United States, such as bath and shop towels as polishing cloths, in order to pay lower tariff rates.  https://www.justice.gov/usao-ndga/pr/textile-importer-resolves-false-claims-act-allegations-0.

And in a matter illustrating the government’s continuing efforts to hold accountable those who seek to take improper advantage of a program that allows companies to remove gas from federal lands upon payment of royalties to the federal government, Citation Oil & Gas Corp. and its affiliates, Citation 2002 Investment Limited Partnership and Citation 2004 Investment Limited Partnership, paid $2.25 million to resolve allegations that they underpaid royalties owed on natural gas produced from federal lands in Wyoming. https://www.justice.gov/opa/pr/citation-companies-agree-pay-225-million-settle-civil-false-claims-act-allegations.

Holding Individuals Accountable

The Department continued its commitment to use the False Claims Act and other civil remedies to deter and redress fraud by individuals as well as corporations.  For example, after a two-week jury trial, the Department obtained judgments totaling more than $114 million against three individuals who were found to have paid physicians illegal remuneration disguised as “handling fees” of between $10 and $17 for each patient they referred to two blood testing laboratories: Health Diagnostic Laboratory of Richmond, Virginia (HDL), and Singulex Inc., of Alameda, California (Singulex). The government also introduced evidence at trial that this kickback scheme resulted in physicians referring patients to HDL and Singulex for medically unnecessary tests, which were then billed to federal health care programs. https://www.justice.gov/opa/pr/united-states-obtains-114-million-judgment-against-three-individuals-paying-kickbacks.

In another kickback case, based on the jury’s verdict for the United States, the court awarded judgment of $5.5 million against neurosurgeon Dr. Sonjay Fonn, his fiancé Ms. Deborah Seeger, and their professional corporations DS Medical and Midwest Neurosurgeons.  The evidence showed that Dr. Fonn performed spinal fusion surgery using implants for which his fiancé received commissions, which were used to benefit Dr. Fonn in the form of lavish purchases such as a yacht and home improvements.  https://www.justice.gov/usao-edmo/pr/federal-judge-trebles-damages-and-imposes-civil-penalties-against-cape-girardeau.  

In addition, former professional cyclist Lance Armstrong paid $5 million to resolve a lawsuit alleging that his admitted use of performance-enhancing drugs and methods (PEDs) resulted in the submission of millions of dollars in false claims for sponsorship payments to the U.S. Postal Service (USPS), which sponsored Armstrong’s cycling team during six of the seven years Armstrong was deemed the winner of the Tour de France.  The lawsuit alleged that Armstrong and his team regularly and systematically employed PEDs, that Armstrong made numerous false statements denying his PED use, and that Armstrong took active measures to conceal his PED use during the USPS sponsorship and even after the sponsorship ended.  https://www.justice.gov/opa/pr/lance-armstrong-agrees-pay-5-million-settle-false-claims-allegations-arising-violation-anti.

Prime Healthcare Services Inc., Prime Healthcare Foundation Inc., and Prime Healthcare Management Inc. (collectively “Prime”), and Prime’s Founder and Chief Executive Officer, Dr. Prem Reddy, paid $65 million to settle allegations that 14 Prime hospitals in California knowingly submitted false claims to Medicare by admitting patients who required only less costly, outpatient care and by billing for more expensive patient diagnoses than the patients had. Dr. Reddy paid $3.25 million of the overall settlement. https://www.justice.gov/opa/pr/prime-healthcare-services-and-ceo-pay-65-million-settle-false-claims-act-allegations. Dr. Arthur S. Portnow of Sarasota, Florida, the owner and operator of Arthur S. Portnow, P.A., d/b/a Apple Medical and Cardiovascular Group, d/b/a Apple Medical Group, agreed to pay $1.95 million to resolve allegations that he and his practice violated the False Claims Act by knowingly seeking reimbursement for medically unnecessary ultrasound tests that were performed on Medicare beneficiaries.  The government also alleged that Dr. Portnow falsified patient records in an effort to justify those unnecessary ultrasounds.  https://www.justice.gov/usao-mdfl/pr/sarasota-physician-agrees-pay-195-million-resolve-false-claims-act-allegations.  Dr. Michael Frey, M.D., a pain management specialist and one of the two principal owners of Advanced Pain Management Specialists P.A. in Fort Myers, Florida, agreed to pay $2.8 million to resolve allegations that he violated the False Claims Act in a number of ways, including receiving illegal kickbacks and by ordering medically unnecessary laboratory tests.  https://www.justice.gov/usao-mdfl/pr/fort-myers-pain-management-physician-pleads-guilty-healthcare-offenses-and-agrees-28.

Recoveries in Whistleblower Suits

Of the $2.8 billion in settlements and judgments reported by the government in fiscal year 2018, over $2.1 billion arose from lawsuits filed under the qui tamprovisions of the False Claims Act.  During the same period, the government paid out $301 million to the individuals who exposed fraud and false claims by filing these actions.

The number of lawsuits filed under the qui tam provisions of the Act has grown significantly since 1986, with 645 qui tam suits filed this past year – an average of more than 12 new cases every week.

“Whistleblowers have played a vital role in unmasking fraudulent schemes that might otherwise evade detection,” said Assistant Attorney General Jody Hunt.  “The taxpayers owe a debt of gratitude to those who often put much on the line to expose such schemes.”

In 1986, Senator Charles Grassley and Representative Howard Berman led the successful efforts in Congress to amend the False Claims Act to, among other things, encourage whistleblowers to come forward with allegations of fraud.  In 2009 and 2010, additional improvements were made to the False Claims Act and its whistleblower provisions.   Congress also included in the False Claims Act authority for the government to dismiss cases, and during the past year the government made increasing use of this tool to help prioritize the use of government resources.   

Finally, Assistant Attorney General Hunt commended the many dedicated public servants throughout the Department’s Civil Division and the U.S. Attorneys’ Offices, as well as the agency Offices of Inspector General and the many other federal and state agencies that contributed to the Department’s False Claims Act recoveries this past fiscal year. “The accomplishments announced today would not have been possible but for the hard work of the men and women throughout the government who work tirelessly to protect the interests of taxpayers,” said Assistant Attorney General Jody Hunt.  “I have served in the Civil Division for many years and it is now my great honor to lead this Division.  I am grateful to work alongside so many passionate, dedicated, and talented employees who have committed their careers to serving the American people and defending the interests of our great nation.”

****

Except where indicated, the government’s claims in the matters described above are allegations only and there has been no determination of liability.  The numbers contained in this press release may differ slightly from the original press releases due to accrued interest.

WASHINGTON –Acting Attorney General Matthew Whitaker today announced that, pursuant to President Trump’s Executive Order 13777 and the Department of Justice’s November 2017 memorandum ending the practice of regulation by guidance, the Department is rescinding 69 additional guidance documents that are unnecessary, outdated, inconsistent with existing law, or otherwise improper.

In making the announcement, Acting Attorney General Whitaker said:

"Under the Constitution, Congress writes our laws and the Executive Branch carries them out," Acting Attorney General Whitaker said. "Congress has given us a specific process for implementing regulations, and we have to follow it. Unfortunately, not every previous Administration has done that, and some have overstepped their lawful authority by issuing guidance documents that impose new obligations on parties outside of the Executive Branch and go further than existing law allows. The Trump Administration has already rescinded dozens of guidance documents that were improper, outdated, unnecessary, or inconsistent with current law, and today we are rescinding dozens more. We will continue this effort to restore the rule of law and our constitutional order because this government is accountable to the American people.”

In March 2017, President Donald Trump issued Executive Order 13777, which calls for agencies to establish Regulatory Reform Task Forces, chaired by a Regulatory Reform Officer, to identify existing regulations for potential repeal, replacement, or modification. Principal Deputy Associate Attorney General Jesse Panuccio chairs the Department of Justice Task Force, which is continuing its review of existing guidance documents that should be repealed, replaced, or modified.

 The Task Force identified 25 guidance documents for repeal in December 2017, 24 guidance documents for repeal in July 2018, and has identified 69 more documents to announce for repeal this month. 

The list of 69 total guidance documents that the Department of Justice is announcing withdrawal of today is as follows:

1. ATF Rev. Ruling 69-114.
2. ATF Ruling 77-25.
3. ATF Ruling 77-26.
4. ATF Ruling 75-30.
5. ATF Ruling 77-13.
6. ATF Ruling 80-22.
7. ATF Procedure 80-7.
8. ATF Ruling 80-23.
9. Open Letter to all FFLs dated Aug. 31, 2006.
10. Open Letter dated Aug. 22, 2001. 
11. Open Letter dated  Nov. 20, 2001.
12. Open Letter dated Nov. 4, 2008.
13. Open Letter to Washington FFLs dated Aug. 12, 2011.
14. 53 Open Letters dated February 1994.
15. Open Letter to all Federal Explosives Licensees and Permittees dated Feb. 12, 2003.  
16. Dear Colleague Letter on Nondiscriminatory Administration of School Discipline dated Jan. 8, 2014.
17. Overview of the Supportive School Discipline Initiative dated Jan. 8, 2014.

Acting Attorney General Matthew G. Whitaker today released the following statement:

"The Pan Am 103 bombing changed this country and it changed law enforcement forever," Acting Attorney General Matthew Whitaker said. "At the time, it was the deadliest terrorist attack on American civilians in our history. The victims came from across America and from every walk of life. College students coming home for Christmas, a couple on their honeymoon, an outstanding Department of Justice prosecutor, and more than 200 other innocent people were targeted by terrorists. In response to that unspeakable tragedy, law enforcement changed the way we investigate terrorism, the way we collaborate with one another, and the way we provide services to crime victims. It is right that the law enforcement community stops today to remember this tragedy, to honor the victims and their families, and to once again recommit ourselves to preventing acts of terror from victimizing the American people ever again."

A Colombian national was arrested in Colombia and extradited to Pittsburgh, Pennsylvania last night on charges related to his alleged role in the robbery of an employee of a New York business that sold jewelry and gemstones.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Scott W. Brady for the Western District of Pennsylvania, Special Agent in Charge Robert Allan Jones of the FBI’s Pittsburgh Field Division and Chief T. Robert Amann for the Northern Regional Police Department in Wexford, Pennsylvania made the announcement.

Oscar Javier Rodriguez Roa, 35, of Bogota, Columbia, was charged by indictment unsealed today in the Western District of Pennsylvania with one count of conspiracy to commit Hobbs Act Robbery and one count of Hobbs Act Robbery.  Roa is scheduled to make his initial court appearance in U.S. District Court in Pittsburgh today at 1:45 p.m. EST before U.S. Magistrate Judge Maureen P. Kelly. 

The indictment alleges that on May 8, 2013, in the Western District of Pennsylvania, Roa and others conspired to rob and robbed an employee of a New York business that sold jewelry and gemstones.  Roa and others allegedly took jewelry and gemstones from the employee against his will by actual and threatened force, violence, and fear of injury. 

The investigation of this case was led by the FBI’s Pittsburgh Field Division, with the assistance of the Northern Regional Police Department.  The Justice Department’s Office of International Affairs provided significant support with the defendant’s extradition.    

Assistant U.S. Attorney Charles A. Eberle of the U.S. Attorney’s Office for the Western District of Pennsylvania and Trial Attorney Leshia Lee-Dixon of the Criminal Division’s Organized Crime and Gang Section in the Justice Department are prosecuting the case.

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

Acting Attorney General Matthew G. Whitaker today released the following statement: 

"Because of loopholes in our laws, tens of thousands of illegal aliens have been able to enter this country, make meritless asylum claims, and then be released and disappear into the United States. But the Trump administration has been taking steps to close these loopholes and eliminate the incentives to come here illegally.  Today the Trump Administration has taken an historic step that will reverse the trends and help restore the rule of law at the border. The Department of Justice will do its part and ensure that we make available the necessary and appropriate resources in light of this historic agreement. Thanks to this and other Trump Administration decisions, the days of our generosity being abused are coming to an end."

A federal grand jury returned a seventh superseding indictment Monday charging nine men in connection with a conspiracy to participate in a racketeering enterprise known as La Mara Salvatrucha, or MS-13.

Charged in the seven-count superseding indictment are Junior Noe Alvarado-Requeno, aka “Insolente,” and “Trankilo,” 22, of Landover, Maryland; Michael Eduardo Contreras, aka “Katra,” and “Insoportable,” 24, of Silver Spring, Maryland; Luis Fernando Orellana-Estrada, aka “Pinguino,” 19, of Hyattsville, Maryland; Kevin Alexander Soriana-Hernandez, aka “Brocha,” 19, of Riverdale, Maryland; Carlos Daniel Cardenas-Banegas, aka “Perrico,” 20, of Riverdale, Maryland; Wilfredo Cardenas-Banegas, aka “Torro,” 25, of Riverdale, Maryland; Luis Arnoldo Flores-Reyes, aka “Maloso,” and “Lobo,” 37, of Arlington, Virginia; Miguel Angel Corea Diaz, aka “Reaper,” 36, of Long Branch, New Jersey, Jairo Arnaldo Jacome, aka “Abuelo,” 36, of Langley Park, Maryland.

Assistant Attorney General Brian A. Benczkowski for the Justice Department’s Criminal Division, U.S. Attorney Robert K. Hur for the District of Maryland, Assistant Director in Charge Nancy McNamara of the FBI Washington Field Office, Special Agent in Charge Gordon B. Johnson of the FBI Baltimore Field Office, Acting Special Agent in Charge Cardell T. Morant of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Baltimore Field Office, Acting Special Agent in Charge Scott Hoernke of the U.S. Drug Enforcement Administration (DEA) Washington Field Division, Chief J. Thomas Manger of the Montgomery County Police Department, Chief Henry P. Stawinski III of the Prince George’s County Police Department, Interim Chief Amal Awad of the Hyattsville Police Department, Prince George’s County State’s Attorney Aisha Braveboy and Montgomery County State’s Attorney John McCarthy made the announcement.

The superseding indictment alleges that from at least prior to in or about 2015 through at least in or about January 2018, the defendants, as members and associates of MS-13, engaged in a racketeering conspiracy that included extortion, drug trafficking, money laundering, robbery, murder, and conspiracy to commit murder.  Jacome was a member and associate of the Langley Park Salvatrucha Clique of MS-13.  All other defendants were members and associates of the Sailors Clique of MS-13. 

Alvarado-Requeno, Contreras, Orellana-Estrada, Soriana-Hernandez, Wilfredo Cardenas-Banegas, Carlos Cardenas-Banegas, and Flores-Reyes were charged in a previous indictment with conspiracy to participate in a racketeering enterprise for their alleged involvement in a variety of violent acts taken by the Sailors Clique of MS-13, including multiple murders. Corea Diaz and Jacome are also charged with RICO conspiracy in the seventh superseding indictment, in which additional murders have been charged. Specifically, the indictment charges that in June 2016, Alvarado-Requeno and Contreras allegedly planned with and directed other members and associates of MS-13 to search for and murder gang rivals known as “chavalas” in and around Hyattsville, Maryland. On June 8, 2016, Alvarado-Requeno and Contreras directed lower-ranking members of MS-13 to murder two individuals who were believed to be members of the 18th Street gang. Pursuant to this plan and as directed by Alvarado-Requeno and Contreras, MS-13 members and associates stabbed the two victims to death in Hyattsville, Maryland.

The indictment further charges that, on Dec. 4, 2016, Alvarado-Requeno, Contreras, Jacome and other members and associates of MS-13 allegedly traveled to Germantown, Maryland with a machete and other weapons with the purpose of murdering an individual as punishment for his infractions against the gang. They stabbed the victim to death, but fled the area leaving the victim’s body near a creek. The next day, Jacome and other members and associates of MS-13 returned to Germantown to bury the body of the victim.

The indictment further charges that, on March 27, 2017, Contreras, Alvarado-Requeno, Flores-Reyes, and Corea-Diaz allegedly arranged for members and associates of the Sailors Clique to travel from Maryland to Lynchburg, Virginia for the purpose of murdering an individual in the Lynchburg area. Flores-Reyes provided the vehicle in which the members and associates drove and called them to provide encouragement to murder the victim. The victim was murdered that same day in Bedford County, Virginia. On March 27 and March 28, 2017, multiple individuals were arrested in connection with the murder. Contreras, Alvarado-Requeno, Flores-Reyes, and Corea-Diaz made phone calls on those dates trying to locate the individuals who had gone to Virginia to commit the murder. Two of the participants in the murder escaped from Bedford County and were hidden in Maryland by members and associates of the Sailors Clique.

In addition to the new charges in the RICO conspiracy, Alvarado-Requeno, Contreras and Jacome are charged in the superseding indictment with murder in aid of racketeering and conspiracy to commit murder in aid of racketeering in connection with the Dec. 4, 2016 murder. Alvarado-Requeno is also charged in the superseding indictment with murder in aid of racketeering and conspiracy to commit murder in aid of racketeering in connection with a Gaithersburg, Maryland murder that took place on June 16, 2016.  Jacome is charged with conspiracy to interfere with interstate commerce by extortion.  All defendants are in custody.

According to the superseding indictment, MS-13 is a national and international gang composed primarily of immigrants or descendants from El Salvador.  Branches or “cliques” of MS-13, one of the largest street gangs in the United States, operate throughout Prince George’s County and Montgomery County, Maryland. 

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

FBI Washington and Baltimore Field Offices, HSI Baltimore, DEA Washington Field Office, the Prince George’s County Police Department, the Montgomery County Police Department, the Prince George’s State’s Attorney’s Office, the Hyattsville Police Department, and the Montgomery County State’s Attorney’s Office investigated this case.  Trial Attorney Francesca Liquori of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorneys William D. Moomau, Catherine K. Dick and Daniel C. Gardner of the District of Maryland are prosecuting this case.

A Suffolk County, New York, resident pleaded guilty today to failing to account for and pay over employment taxes to the Internal Revenue Service (IRS), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division. 

According to court documents, Scott Warner owned and operated a temporary employment agency in Suffolk County, New York, that did business under multiple names, including Around the Clock Staffing Inc., Your Staffing Service Inc., Your Staffing Services Inc., Revlis Consulting Corp., and City Consulting Corp.  Warner was responsible for withholding federal income tax, Social Security and Medicare taxes from his employees’ wages, paying the taxes over to the IRS, and filing employment tax returns.  Despite this obligation, Warner failed to pay over to the IRS approximately $687,480 withheld from employee wages from Oct. 2012 through Dec. 2016. 

Warner faces a maximum sentence of five years in prison.  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, who conducted the investigation, and Tax Division Trial Attorneys Mark Kotila and Ann M. Cherry, who are prosecuting this case. 

The Justice Department today announced that it has reached a settlement agreement with Sinai Health System Inc. (Sinai) in Chicago, Illinois.   Sinai serves the health care needs of the approximately 1.5 million people who reside within its service areas -- Chicago’s west and southwest sides -- and comprises Mount Sinai Hospital Medical Center of Chicago, Holy Cross Hospital, Schwab Rehabilitation Hospital and Care Network, Sinai Children’s Hospital, Sinai Community Institute, Sinai Medical Group, and Sinai Urban Health Institute.  The settlement resolves a claim that Sinai violated the anti-discrimination provision of the Immigration and Nationality Act (INA) by discriminating against non-citizen employees when verifying their work authorization. 

The Department’s independent investigation concluded that, from at least Jan. 1, 2016, to Sept. 30, 2017, a human resources employee responsible for verifying employees’ work authority routinely required newly hired non-U.S. citizen employees to provide specific documentation issued by the Department of Homeland Security to prove employment eligibility.  In contrast, U.S. citizen employees were permitted to present the documentation of their choice to establish their work authorization.  Federal law allows individuals, regardless of citizenship status, the right to choose which document to present, from a range of valid documents, to demonstrate their authority to work in the United States.  The anti-discrimination provision of the INA prohibits employers from subjecting employees to unnecessary documentary demands based on employees’ citizenship status or national origin.

“Employers are reminded that the employment eligibility verification process is intended to confirm an employee’s work authorization, not their immigration status,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division.  “The Division commends Sinai for its commitment to complying with the anti-discrimination provision of the INA.”

Under the settlement, Sinai will pay $7,000 in civil penalties to the United States and be subject to departmental monitoring and reporting requirements.  The agreement also requires certain employees to attend training on the requirements of the INA’s anti-discrimination provision, and Sinai will make available IER materials containing information about IER and the anti-discrimination provision of the INA at various locations.  

The 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 and Spanish websites.

Applicants or employees who believe they were subjected to retaliation; different documentary requirements based on their citizenship, immigration status or national origin; or discrimination based on their citizenship, immigration status, or national origin in hiring, firing, or recruitment or referral for a fee, should contact IER’s worker hotline for assistance.

Eight Dallas, Texas-area pharmacy owners and marketers were charged in an indictment unsealed today for their roles in a scheme involving approximately $92 million in compound drug claims to TRICARE and the U.S. Department of Labor (DOL), which were allegedly the product of over $9.1 million in illegal kickbacks.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, Special Agent in Charge Michael Mentavlos of the Defense Criminal Investigative Service (DCIS) Southwest Field Office, Special Agent in Charge Steven Grell of the U.S. Department of Labor - Office of Inspector General’s (DOL-OIG) Dallas Region and Special Agent in Charge CJ Porter of the Office of Inspector General for the U.S. Department of Health and Services (HHS-OIG) made the announcement.

Richard Hall, 48; Scott Schuster, 47; Dustin Rall, 43; George Lock Paret, 34; and Michael Ranelle, 49, all of Fort Worth, Texas; John Le, 43, of Dallas; Quintan Cockerell, 37, of Manhattan Beach, California; and Turner Luke Zeutzius, 36, of Horseshoe Bay, Texas, were each charged in an indictment filed Dec. 12 in the Northern District of Texas with one count of conspiracy to defraud the United States and pay and receive kickbacks.  Hall, Schuster, Rall, and Le were each additionally charged with four counts of paying kickbacks.  Zeutzius was additionally charged with two counts of receiving kickbacks and Ranelle and Cockerell were each charged with one count of receiving kickbacks.  Hall, Schuster, Rall, Le and Ranelle were arrested yesterday and had their initial court appearances before U.S. Magistrate Judge Irma C. Ramirez in Dallas.   Paret, Cockerell and Zeutzius self-surrendered this morning and will have their initial court appearances today at 2 p.m. CST before Judge Ramirez.

According to the indictment, from May 2014 to September 2016, Hall, Schuster, Rall, Paret, Le and their co-conspirators allegedly engaged in a scheme to pay kickbacks and bribes for the referral of TRICARE and DOL beneficiaries to obtain expensive compound drugs.  Hall, Shuster and Rall were co-owners of Rxpress Pharmacy and Xpress Compounding, compound pharmacies located at 1000 W. Weatherford St. in Fort Worth. 

As alleged in the indictment, Rxpress and Xpress were separate in name only; Rxpress Pharmacy and Xpress Compounding employed the same staff, operated out of the same building, and utilized a call center to direct prescriptions depending on whether the prescriptions were for private or federal insurance.  The indictment alleges that both companies utilized the same marketers but paid them differently depending on whether they were receiving a commission on a federal or private prescription, in order to disguise the illegal kickback payments on federal prescriptions.  Specifically, Hall, Schuster, Rall, Paret and Le allegedly devised a scheme to make kickback payments to marketers through Xpress Compounding for the referral of federal prescriptions.  These marketers were allegedly set up as sham “W-2” employees to appear as though they were bona fide employees of Xpress Compounding.  At the same time, these marketers were paid as 1099 contractors by Rxpress Pharmacy, the indictment alleges. 

The indictment alleges that as a result of the scheme, Zeutzius was paid approximately $4.4 million, Cockerell (through an unnamed person) was paid approximately $2.1 million, and Ranelle was paid approximately $2.6 million in illegal kickbacks, for a total of approximately $9.1 million in illegal kickbacks. 

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

DCIS, DOL-OIG, the U.S. Department of Health and Human Services Office of Inspector General, the FBI and the U.S. Department of Veterans Affairs Office of Inspector General investigated the case.  Assistant Chief Adrienne Frazior and Trial Attorney Brynn Schiess of the Criminal Division’s Fraud Section are prosecuting the case.

The Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and the U.S. Department of Health and Human Services (HHS) to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.