District Not Recorded

En Pointe Gov. Inc., En Pointe Technologies Inc., En Pointe Technologies Sales Inc., Dominguez East Holdings LLC and Din Global Corp., all of Gardena, California, have agreed to resolve allegations that they violated the False Claims Act by falsely certifying that En Pointe Gov. Inc. was a small business in order to obtain contracts set aside for small businesses and underreporting sales under a General Services Administration (GSA) contract to avoid the payment of fees, the Department of Justice announced today.  Under the settlement agreement, the companies have agreed to pay slightly more than $5.8 million.  En Pointe Gov. Inc. is now known as Modern Gov IT Inc.; En Pointe Technologies Sales Inc. is now known as Collab9 Inc.; and En Pointe Technologies Inc. is now known as Dinco Inc.

“Contractors who misrepresent their eligibility for government contracts, or fail to pay amounts owed under those contracts, undermine the integrity of the procurement process,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “The Justice Department will take action to fully protect taxpayer funds.”

“These companies defrauded the government in two ways, each of which cost taxpayers,” said U.S. Attorney Eileen M. Decker for the Central District of California. “Small businesses, in some cases, are eligible to receive a preference when government contracts are issued. Large companies that fraudulently solicit and obtain contracts under small business set-aside programs, like the companies in this case, not only abuse the system but also harm legitimate small businesses by taking those contracts away from them.”

The government alleged that, between 2011 and 2014, the defendants were liable for false representations that En Pointe Gov. Inc. met Small Business Administration (SBA) requirements to obtain work that was only available to small businesses.  In particular, the government alleged that En Pointe Gov Inc.’s affiliation with the other defendants rendered it a non-small business and, thus, ineligible for the small business set-aside contracts it obtained.

The government also alleged that defendants caused En Pointe Gov. Inc. to file false quarterly reports with the GSA between 2008 and 2015 underreporting sales made under a GSA schedule contract that allowed other federal agencies to purchase from En Pointe.  Under the terms of the contract, En Pointe was supposed to return to GSA a percentage of its sales receipts.  By allegedly misrepresenting the amount of its sales, En Pointe underpaid the fees that it owed to GSA.

“GSA contractors must be forthright in their dealings with the United States,” said GSA Inspector General Carol Fortine Ochoa.

“Federal contracts set aside for small businesses are intended to grow the economic base of the nation,” said SBA Inspector General Peggy E. Gustafson.  “The Office of Inspector General will aggressively investigate such misrepresentations to ensure only eligible businesses are awarded these contracts.  I want to thank the U.S. Department of Justice for its dedication to pursuing justice in this case.”

“This case represents the cooperative effort of SBA and the Department of Justice to uncover and remedy fraud in federal contracting with small businesses,” said SBA General Counsel Melvin F. Williams, Jr.  “Uncovering and pursuing fraud cases is one of SBA’s highest priorities.” 

The settlements resolve allegations filed in a lawsuit by Minburn Technology Group, LLC (Minburn), a Virginia company that sells information technology products and services, and Anthony Colangelo, Minburn’s managing member.  The lawsuit was filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery.  The Act also allows the government to intervene and take over the action, as it did in this case.  Minburn and Mr. Colangelo will receive approximately $1.4 million.

This settlement was the result of a coordinated effort by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Central District of California and the GSA and SBA Inspector General Offices.

The case is captioned United States ex rel. Colangelo et al. v. En Pointe Gov., Inc., et al., CV14-5865-RGK (JPRx) (C.D. Cal.).  The claims resolved by the settlements are allegations only and there has been no determination of liability.

The U.S. District Court for the Southern District of Alabama entered a consent decree of permanent injunction against BEK Catering LLC dba Floppers Foods LLC of Daphne, Alabama, and its co-owners, Billy B. Stembridge and Kyle D. Huxen, to prevent the distribution of adulterated and misbranded seafood products, the Department of Justice announced today. 

The Department filed a complaint in the Southern District of Alabama on July 1, at the request of the U.S. Food and Drug Administration (FDA).  According to the complaint, BEK Catering prepares, processes, packs, holds, and distributes ready-to-eat seafood products, namely seafood soups sold under the names Shrimp Locksley and Mama’s Gumbo.  The complaint alleged that the defendants caused food to become adulterated and misbranded. 

“Adulterated and misbranded seafood products can create serious health risks for consumers,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “The Department of Justice will continue to work aggressively with the FDA to ensure a safe food supply.”

In conjunction with the filing of the complaint, the defendants agreed to settle the litigation and be bound by a consent decree of permanent injunction.  As part of the settlement, the defendants represented that they are no longer engaged in the processing, packing, or holding of fish and fishery products from any location except for activities incidental to product transport and delivery.  Under the permanent injunction, if the defendants intend to resume processing, packing, or holding fish or fishery products at or from any location, beyond activities incidental to transporting and delivering product, they must notify FDA in writing 90 days in advance, comply with specific remedial measures set forth in the injunction, and be subject to FDA inspection. 

According to the complaint, Stembridge is a co-owner of BEK Catering and refers to himself as the firm’s “Managing Partner.”  As alleged in the complaint, Stembridge has ultimate authority over all of the firm’s operations, including major financial expenditures, production processes, product distribution, and employee supervision.  The complaint further alleged that Huxen is a co-owner of BEK Catering, responsible for BEK Catering’s compliance with FDA’s seafood processing regulations and training new employees, and shares responsibility with Stembridge for the firm’s operations.

As alleged in the complaint, the defendants caused the company’s food to become adulterated in that it was prepared, packed, or held under insanitary conditions whereby it may have become contaminated with filth, or whereby it may have been rendered injurious to health.  For example, according to the complaint, during a 2015 inspection, FDA determined that the defendants failed to have adequate control over the risk of C. botulium and C. perfringens growth and toxin formation, failed to have adequate control over the risk of L. mono growth, and failed to have adequate control over the hazards posed by major food allergens and food additives.

C. botulinum is a bacterium that forms spores capable of producing a potent neurotoxin in food.  People are susceptible to C. botulinum’s neurotoxin, and ingestion of even a small amount of the neurotoxin can cause botulism.  Although the incidence of botulism is rare, the disease can cause paralysis and has a high mortality rate if treatment is not prompt and appropriate.

C. perfringen is a bacterium that causes foodborne illness.  High doses of this bacterium can form a toxin in the digestive tract that results in illness.  People can be sickened by C. perfringens’ toxin, which causes diarrhea and abdominal cramps and can produce more severe symptoms in the young and elderly. 

L. mono. is the bacterium that causes listeriosis, a disease commonly contracted by eating food contaminated with L. mono.  Listeriosis can be serious, even fatal, for vulnerable groups such as newborns and people with impaired immune systems.  The most serious forms of listeriosis can result in meningitis and septicemia.  Pregnant women may contract flu-like symptoms from listeriosis, and complications from the disease can result in miscarriage, or a life-threatening infection in the newborn.

As noted in the complaint, FDA has conducted five inspections of BEK Catering’s various manufacturing facilities dating back to 2011, and during each inspection, FDA found similar types of insanitary conditions and repeated violations of seafood Hazard Analysis and Critical Control Point regulations and current Good Manufacturing Practice regulations.

The government is represented by Counsel Melanie Singh of the Civil Division’s Consumer Protection Branch with the assistance of Senior Chief Counsel Claudia Zuckerman of the Food and Drug Division, Office of General Counsel, Department of Health and Human Services.

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. 

Three Georgia real estate investors pleaded guilty today for their roles in bid-rigging and fraud conspiracies committed at public real estate foreclosure auctions in Georgia, the Department of Justice announced today. 

Jeffrey Wayne Brock, David Wallace “Chuck” Doughty, and Stanley Ralph Sullivan each admitted that they agreed to rig auctions of foreclosed homes in Cobb County from June 2007 until January 2012.  According to court documents filed in the U.S. District Court for the Northern District of Georgia, Brock, Doughty, Sullivan and their co-conspirators agreed not to compete for the purchase of selected foreclosed homes so that they could win the auctions for those homes with artificially low bids.  The winning bidders then made payoffs to conspirators who had refrained from bidding against them.  As a result, conspirators profited from money that otherwise would have gone to mortgage holders and other secured debt holders, and in some cases, to the owners of foreclosed homes.

“These defendants conspired to corrupt foreclosure auctions that should have benefited lenders and homeowners,” said Principal Deputy Assistant Attorney General Renata Hesse, head of the Justice Department’s Antitrust Division.  “The Antitrust Division will continue to work with our colleagues at the FBI to pursue those who took advantage of disruption caused by the financial crisis to line their own pockets.”

 “Foreclosure auction fraud in Georgia remains a focus for the FBI investigators and federal prosecutors within the Antitrust Division of the U.S. Department of Justice,” said Special Agent in Charge J. Britt Johnson of the FBI’s Atlanta Division.  “By the very nature of this criminal act, the bank, and more importantly, the home owner in financial distress, are the victims that these federal laws were created to protect. The FBI will continue to provide investigative assets toward these matters in order to keep the level playing field that the law intended regarding these auctions.”

Including the individuals pleading today, twenty defendants have been charged in connection with the department’s ongoing investigation into bid rigging and fraudulent schemes involving real estate foreclosure auctions in the Atlanta area.  Eighteen of those have either pleaded guilty or agree to plead guilty.

These charges have been filed as a result of the ongoing investigation being conducted by the Antitrust Division’s Washington Criminal II Section, the FBI’s Atlanta Division and the U.S. Attorney’s Office of the Northern District of Georgia, in connection with the president’s Financial Fraud Enforcement Task Force.  The president established the task force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  With more than 20 federal agencies, 94 U.S. Attorneys’ Offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud.  Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations.  Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants.  For more information about the task force, please visit www.StopFraud.gov.  Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Washington Criminal II Section of the Antitrust Division at 202-598-4000, call the Antitrust Division’s Citizen Complaint Center at 888-647-3258, or visit http://www.justice.gov/atr/report-violations.

FRESNO, Calif. — Late Wednesday afternoon, after a two–day trial, a federal jury found Alfonso Hernandez, 58, of Fresno, guilty of two counts of receiving and distributing child pornography, Acting United States Attorney Phillip A. Talbert announced.

According to evidence presented at trial, in January 2012, agents identified Hernandez’s computer making over 500 separate child pornography files publicly available online to other users within a peer-to-peer file sharing network. A search warrant was executed at Hernandez’s residence, and in a bedroom secured with a deadbolt lock, agents seized a computer and external hard drives that were found to contain child pornography. Ultimately, it was determined that Hernandez had downloaded and shared thousands of child pornography files onto these devices. Hernandez was arrested in September 2014 and has been in custody since that time.

This case is the product of an investigation by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Kings County District Attorney’s Office of Investigation, and the Fresno Police Department. Assistant United States Attorneys Brian W. Enos and Vincenza Rabenn are prosecuting the case.

“Defendants who distribute child pornography prey on innocent victims from behind their screens where they often think they cannot be found,” said Ryan L. Spradlin, special agent in charge of HSI San Francisco. “Together with our law enforcement partners, we remain vigilant in our tireless efforts to root out child predators from the shadows that they lurk.”

Hernandez is scheduled to be sentenced by United States District Judge Dale A. Drozd on October 17, 2016. Hernandez faces a mandatory minimum sentence of five years in prison, a maximum statutory penalty of 20 years in prison and a $250,000 fine regarding each count. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.

A Las Vegas-area dentist was sentenced today to 13 months in prison for tax evasion, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Daniel G. Bogden of the District of Nevada.

Leslie Kotler, 56, pleaded guilty in June 2014 to evading his taxes over a nine year period, causing a $600,000 tax loss and admitted to using a number of nominee bank accounts and bogus trusts to hide his income and assets from the Internal Revenue Service (IRS).  Kotler also filed false income tax returns for the years 2008 through 2011 that materially understated his income and filed a false bankruptcy petition in an attempt to delay the IRS’s ongoing efforts to collect the large amount of taxes he owned.

“With today’s sentence, Mr. Kotler is held accountable and pays a heavy price for his egregious conduct in evading both the assessment and payment of taxes,” said Acting Assistant Attorney General Ciraolo.  “The court’s sentence reflects the serious harm caused by those who fail to comply with our nation’s tax laws and will serve to deter other individuals contemplating similar criminal conduct.”

“Leslie Kotler’s attempt to evade taxes by hiding income and filing false tax returns was a theft from the American public,” said Acting Special Agent in Charge Michael Brock of the IRS-Criminal Investigation Las Vegas Field Office.  “To build faith in our nation’s tax system, honest taxpayers need to be reassured that everyone is paying their fair share.  The IRS-Criminal Investigation Division, along with the Department of Justice, will investigate and prosecute those who violate our tax system.”

In addition to the term of imprisonment, U.S. District Judge Andrew Gordon of the District of Nevada ordered Kotler to serve three years of supervised release and pay restitution in the amount of $712,280.  Before his sentencing, Kotler paid a total of $450,429 in back taxes, interest and fraud penalties.

Acting Assistant Attorney General Ciraolo thanked special agents of IRS-Criminal Investigations, who investigated the case and Tax Division Trial Attorney Thomas W. Flynn, who is prosecuting the case.

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

A Baltimore, Maryland, tax return preparer was sentenced today to serve 20 months in prison for aiding and assisting in the preparation of false tax returns for others, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.

On February 8, following a five day trial, a federal jury convicted Charles Imariagbe of 15 counts of aiding and assisting in the preparation of false income tax returns.  According to court documents and the evidence presented at trial, between 2008 and 2012, Imariagbe operated a tax preparation business in Baltimore called JC Tax Service Inc.  During that time, Imariagbe prepared false individual income tax returns for at least seven clients for submission to the Internal Revenue Service (IRS).  These tax returns claimed false and fraudulent income and expenses from Schedule C businesses and grossly inflated or wholly fictitious mileage expenses.  The false items on these returns resulted in the clients receiving larger tax refunds than they were entitled to receive.  

In addition to the prison term, U.S. District Judge Ellen L. Hollander ordered Imariagbe to serve three years of supervised release and pay restitution to the IRS in the amount of $151,927.

Acting Assistant Attorney General Ciraolo commended the special agents of IRS-Criminal Investigation, who investigated the case and Trial Attorneys Andrew Kameros and Brittney Campbell of the Tax Division, who prosecuted the case. 

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

The Justice Department and the Republic of El Salvador established a formal partnership today to protect workers from discrimination based on citizenship, immigration status and national origin.  Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division, and Salvadoran Ambassador Claudia Canjura De Centeno signed a memorandum of understanding (MOU) between the embassy and its consulates and the division’s Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC).

As part of the MOU, OSC and the Salvadoran government will collaborate to educate workers about their employment rights and to provide them with the resources needed to protect those rights.  Additionally, the MOU seeks to promote training for employers on their obligations under the anti-discrimination provision of the Immigration and Nationality Act (INA), which prohibits employment discrimination based on citizenship, immigration status and national origin.  Specifically, the MOU provides that:

• OSC will train Salvadoran consular staff on the anti-discrimination provision of the INA, participate in events organized by Salvadoran consulates to educate workers and employers and distribute educational materials to the embassy and its consulates.
• The embassy will establish a system for referring discrimination claims from the embassy and consulates to OSC.

“We welcome our newest partner to help the Civil Rights Division combat unlawful discrimination against workers employed in the United States and we value the ability to work together to achieve this important goal,” said Principal Deputy Assistant Attorney General Gupta.  “We hope that formalizing our partnership with El Salvador will send a clear message to workers that we are eager to assist them.”

Today’s agreement is particularly useful due to the large number of Salvadoran nationals with temporary protected status (TPS), who are eligible to live and work in the United States, but who sometimes encounter discrimination by employers either based on their immigration status or national origin.  TPS is a temporary immigration status granted to eligible nationals of a country designated for TPS under the INA.  During the TPS designation period, TPS beneficiaries are authorized to work in the United States.

OSC is responsible for enforcing the anti-discrimination provision of the INA.  Among other things, this law prohibits citizenship status and national origin discrimination in hiring, firing or recruitment or referral for a fee; discrimination in the employment eligibility verification process; retaliation and intimidation.  In addition to its enforcement work, OSC educates the public on rights and responsibilities under the INA’s anti-discrimination provision.  More information on OSC is available at www.justice.gov/crt/about/osc.

For more information about protections against employment discrimination under immigration laws, call OSC’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call OSC’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar at www.justice.gov/crt/about/osc/webinars.php; email osccrt@usdoj.gov or visit OSC’s website at www.justice.gov/crt/about/osc.   

A Marietta, Georgia, resident pleaded guilty in the U.S. District Court for the Northern District of Georgia today to one count of theft of public money and one count of aggravated identity theft, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney John A. Horn of the Northern District of Georgia.

Peter Isika, 46, admitted using stolen identities to file at least 50 false tax returns for tax years 2013 and 2014 claiming more than $500,000 in fraudulent refunds.  Isika admitted that he purchased the stolen identities over the Internet and used those identities to obtain the fraudulent tax refunds.  Isika directed the refunds to prepaid debit cards or bank accounts that he controlled.

A sentencing date has not been scheduled for Isika.  He faces a statutory maximum sentence of 10 years in prison for the theft of public money charge and an additional statutory mandatory sentence of two years in prison for aggravated identity theft.  He also faces a term of supervised release and monetary penalties.

Acting Assistant Attorney General Ciraolo and U.S. Attorney Horn commended special agents of the Internal Revenue Service-Criminal Investigation and U.S. Treasury Inspector General for Tax Administration, who investigated the case and Trial Attorneys Jason Poole and Mara Strier of the Tax Division and Assistant U.S. Attorney Kamal Ghali, who are prosecuting the case.

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

An Ocala, Florida, cardiologist, Dr. Asad Qamar, and his practice, the Institute of Cardiovascular Excellence (ICE), will pay $2 million, plus release any claim to $5.3 million in suspended Medicare funds, to resolve a lawsuit alleging that they improperly billed Medicare, Medicaid and TRICARE for medically unnecessary procedures, and paid kickbacks to patients by waiving Medicare copayments irrespective of financial hardship, the Justice Department announced today.  Dr. Qamar also agreed to a three-year period of exclusion from participating in any federal health care program followed by a three-year Integrity Agreement with the Department of Health and Human Services Office of the Inspector General (HHS-OIG).  The settlement relates to two consolidated lawsuits in which the United States intervened on Dec. 22, 2014.

“Billing federal health programs for medically unnecessary procedures is unacceptable – not only does it waste taxpayer funds, but it also puts patients at risk,” said Principal Deputy Assistant Attorney General, Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “Today’s settlement evidences the Department of Justice’s firm commitment to protect public funds and to safeguard the well-being of federal health care program beneficiaries.”

The settlement resolves the government’s lawsuit claiming that Dr. Qamar and ICE billed Medicare, Medicaid and TRICARE for excessive, medically unnecessary and inadequately documented peripheral artery interventional services and related procedures.  Many of the cardiovascular procedures for which Dr. Qamar and ICE billed Medicare and the other programs were not indicated by patients’ medical histories or records, or the severity of the patients’ symptoms. 

The government also alleged that to help facilitate this false billing scheme, Dr. Qamar and ICE routinely and indiscriminately waived the 20 percent Medicare copayment, irrespective of the patient’s financial need.  Medicare copayments assure that patients have an incentive to be smart healthcare consumers and avoid unnecessary procedures.  By waiving the required copayments indiscriminately, Dr. Qamar and ICE induced patients to agree to unnecessary and invasive procedures and other services.  Dr. Qamar’s and ICE’s illegal conduct made Dr. Qamar the highest paid Medicare cardiologist in the country in 2012 and 2013.

“Patient safety is of paramount importance,” said U.S. Attorney A. Lee Bentley III for the Middle District of Florida.  “When a doctor performs medically unnecessary and invasive procedures on Medicare patients, federal healthcare programs are defrauded and, more importantly, patients’ lives and wellbeing are recklessly put at risk.  This case shows our office’s steadfast commitment to holding medical providers personally responsible for their actions.” 

“When medical professionals act on greed to perform unnecessary, invasive procedures on Medicare and Medicaid patients, both patient health and taxpayer funds are compromised,” said Special Agent in Charge Shimon R. Richmond of HHS-OIG.  “Our agents and investigators will continue to work hard with our law enforcement partners to ensure that health care providers who engage in such illegal behavior are held accountable.”

The allegations resolved by today’s settlement were originally raised in two lawsuits filed pursuant to the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government when they discover evidence that defendants have submitted false claims for government funds and to receive a share of any recovery.  The False Claims Act also permits the government to intervene in such lawsuits, as it has done in these cases.  The cases are captioned United States ex rel. Doe v. Institute of Cardiovasular Excellence, PLLC, ICE Holdings, PLLC, Dr. Asad Qamar, & Dr. Humera Qamar, Case No. 5:11-CV-406-OC-KRS (M.D. Fla.); United States ex rel. Taylor & the State of Florida v. Institute of Cardiovascular Excellence & Dr. Asad Qamar, Case No. 8:14-CV-1454-T-35-EAS (M.D. Fla.).  The relators Dr. Robert A. Green and Ms. Holly A. Taylor will receive $1,327,721 as their share of the settlement.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $29.9 billion through False Claims Act cases, with more than $18.3 billion of that amount recovered in cases involving fraud against federal health care programs. 

This case was handled by the Commercial Litigation Branch of the Department of Justice’s Civil Division, the U.S. Attorney’s Office for the Middle District of Florida, HHS-OIG, and the Defense Health Agency on behalf of the TRICARE program.  The claims asserted by the government are allegations only, and there has been no determination of liability.  

A federal court in Fort Lauderdale, Florida, has permanently barred a Broward County man from preparing federal tax returns for others, the Justice Department announced today.

The United States filed a civil complaint against Eli St. Phard of Oakland Park, Florida, in April.  The complaint alleged that he prepared income tax returns that fraudulently understated his customers’ tax liabilities by falsely claiming deductions for business expenses his customers never incurred; fraudulently overstating his customers’ claims for refunds by falsely claiming education or fuel tax credits to which his customers were not entitled; or both.  According to the complaint, the Internal Revenue Service (IRS) audited 340 of the returns St. Phard prepared and found that St. Phard understated the tax owed on all but five of the 340 returns—a total of more than $1.8 million in understatements.  As a result of St. Phard’s fraudulent activities, many of his customers are now liable for significant tax deficiencies, penalties and interest, the complaint alleged.

In addition to barring St. Phard from preparing federal tax returns, the court ordered St. Phard to give the United States a list of his customers.  St. Phard consented to entry of the order by the U.S. District Court for the Southern District of Florida.  St. Phard admitted, for purposes of this case, that he had engaged in conduct subject to penalty under the federal tax laws, but he did not admit to civil or criminal wrongdoing or to the specific allegations in the complaint.

Return preparer fraud is one of the IRS’s Dirty Dozen Tax Scams for 2016.  The IRS has some tips on their website for choosing a tax preparer and has launched a free directory of federal tax preparers.  In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers.  Information about these cases is available on the Justice Department’s website.  An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page.  If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

WASHINGTON – El Departamento de Justicia y la República de El Salvador establecieron hoy una asociación formal para proteger a trabajadores de la discriminación por motivos de su ciudadanía, estatus migratorio o nacionalidad de origen. La Secretaria de Justicia Auxiliar Adjunta Principal, Vanita Gupta, Directora de la División de Derechos Civiles del Departamento de Justicia y la embajadora salvadoreña, Claudia Canjura De Centeno, firmaron un memorando de entendimiento (MOU, por sus siglas en inglés) entre la embajada y sus consulados y la Oficina del Consejero Especial para Prácticas Injustas en el Empleo Relacionadas con la Inmigración (OSC, por sus singlas en inglés), que pertenece a la División.

Como parte del MOU, la OSC y el gobierno salvadoreño se comprometen a colaborar para educar a los trabajadores acerca de sus derechos y brindarles los recursos necesarios para proteger tales derechos. Asimismo, el MOU promueve la capacitación para empleadores en cuanto a sus obligaciones al amparo de la ley de Inmigración y Nacionalidad (INA, por sus siglas en inglés), que prohíbe la discriminación en el empleo por motivos de ciudadanía, estatus migratorio o nacionalidad de origen. En concreto, el MOU dispone que:

• La OSC capacitará al personal consular salvadoreño en lo que se refiere a la disposición de la INA, participará en eventos organizados por los consulados salvadoreños para educar a los trabajadores y empleadores y distribuirá materiales educativos a la embajada y sus consulados.

• La embajada establecerá un sistema para referir denuncias de discriminación recibidas en la embajada y sus consulados a la OSC.

“Damos la bienvenida a este socio nuevo que ayudará a la División de Derechos Civiles a combatir la discriminación ilícita en contra de empleados que trabajan en los Estados Unidos y sinceramente apreciamos la oportunidad de alcanzar esta meta tan importante,” declaró la Secretaria de Justicia Auxiliar Adjunta Principal, Vanita Gupta.  “Esperamos que la formalización de nuestra asociación con El Salvador mande un mensaje claro a los trabajadores de nuestras ganas de ayudarlos.”

El acuerdo de hoy resulta particularmente útil por el gran número de nacionales salvadoreños con el estatus de protección temporal (TPS, por sus siglas en inglés), los cuales son elegibles para vivir y trabajar en los Estados Unidos pero quienes a veces son discriminados por sus empleadores, ya sea por motivos de su estatus migratorio o por su nacionalidad de origen. El TPS es un estatus migratorio temporal que se extiende a nacionales elegibles de un país designado para el TPS al amparo de la INA. Durante el período de duración del TPS, los beneficiarios del TPS cuentan con autorización para trabajar en los Estados Unidos.

La OSC es responsable de aplicar la disposición antidiscriminatoria de la INA. Entre otras cosas, esta ley prohíbe la discriminación por motivos de estatus de ciudadanía o nacionalidad de origen en los procesos de contratación, despido o reclutamiento o recomendación por comisión; la discriminación en el proceso de verificación de la elegibilidad de empleo; las represalias y la intimidación. Además de sus esfuerzos por aplicar la ley, la OSC se dedica a educar al público en cuanto a los derechos y las responsabilidades al amparo de la disposición antidiscriminatoria de la INA. Si desea más información sobre la OSC, vaya a www.justice.gov/crt/about/osc.

Para más información sobre protecciones contra la discriminación en el empleo en virtud de las leyes migratorias, llame a la línea directa de la OSC para trabajadores al 1‑800‑255-7688 (1‑800-237-2515, TTY para personas con discapacidades auditivas); llame a la línea directa de la OSC para empleadores al 1-800-255-8155 (1-800-237-2515, TTY para personas con discapacidades auditivas); matricúlese para un seminario en línea gratuito en www.justice.gov/crt/about/osc/webinars.php; mande un correo electrónico a osccrt@usdoj.gov o visite la página web de la OSC en www.justice.gov/crt/about/osc.  

*******MEDIA ADVISORY*******

Attorney General Loretta E. Lynch and Facebook will hold a Community Policing Town Hall on Facebook Live at Facebook’s Playa Vista Campus, today, THURSDAY, JUNE 30, 2016, at 11:30 a.m. PT/2:30 p.m. ET.  The town hall will be moderated by actor Michael B. Jordan, star of Creed and Fruitvale Station, with participation from actress Yara Shahidi, star of ABC’s Blackish.  The town hall discussion will be live-streamed on the official Facebook Live page and the Justice Department’s social media platforms. 

“One of my top priorities as Attorney General is strengthening relationships between law enforcement officers and the communities we serve and protect,” said Attorney General Lynch.  “We are here on this stop of the Community Policing Tour to show how social media can be used as a vital tool to provide both transparency and opportunity for meaningful interactions into law enforcement thought and policy.”  

This conversation style town hall marks the last official stop on the Attorney General’s 12-city Community Policing Tour and will highlight the social media and technology pillar of the President’s Task Force on 21st Century Policing final report.  The town hall audience will consist of local high school juniors, seniors, college students and LAPD “cadets” – young people who volunteer to work at the LAPD – and 15 officers from the Hollenbeck Police Activities League and LA Sheriff Department.

Attorney General Loretta E. Lynch will travel to Aspen, Colorado, on FRIDAY, JULY 1, 2016, to participate in a moderated arm chair conversation on 21st Century Policing, Civil Rights and Criminal Justice Reform with Jonathan Capehart of the Washington Post at the 2016 Aspen Ideas Festival. 

FACEBOOK TOWN HALL

WHO:             Attorney General Loretta E. Lynch

Michael B. Jordan

Yara Shahidi

WHEN:          THURSDAY, JUNE 30, 2016

11:30 a.m. PDT

WHERE:       Facebook Playa Vista Campus

12025 Waterfront Dr.

Los Angeles, CA 90094

POOLED PRESS: Network Pool KABC-ABC Affiliate 

LIVE STREAMED ON: https://www.facebook.com/DOJ.

NOTE:  Press inquiries regarding logistics should be directed to press@usdoj.gov.     

Background on the Community Policing Tour:

Including Los Angeles, the Attorney General visited six jurisdictions around the country during this second phase of the tour that have excelled in each of the six pillars discussed in the President’s Task Force on 21st Century Policing final report: (1) Building Trust and Legitimacy; (2) Policy and Oversight; (3) Technology and Social Media; (4) Community Policing and Crime Reduction; (5) Officer Training and Education; and (6) Officer Safety and Wellness.  The trip to Los Angeles highlighted Pillar 3 – Technology and Social Media.  Attorney General Lynch launched the tour in February in Miami Dade County, Florida, and she visited Portland, Oregon, in March as well as Indianapolis, Indiana, in April.  The Attorney General visited Phoenix on Tuesday and is concluding the second phase of the tour with this last stop in Los Angeles.  

COMMUNITY POLICING TOUR

• Pillar 1 – Miami/Doral, Florida – Building Trust and Legitimacy
• Pillar 2 – Fayetteville, North Carolina – Policy and Overnight
• Pillar 3 – Los Angeles, California – Technology and Social Media
• Pillar 4 – Portland, Oregon – Community Policing and Crime Reduction
• Pillar 5 – Phoenix, Arizona – Training and Education
• Pillar 6 – Indianapolis, Indiana – Officer Safety and Wellness

More information on the #CommunityPolicing tour is available at the following page: http://www.justice.gov/ag/community-policing-tour.

The Attorney General’s national Community Policing Tour builds on President Obama’s commitment to engage with law enforcement and other members of the community to implement key recommendations from the President’s Task Force on 21st Century Policing final report.  The first phase of the tour launched on May 19, 2015, in Cincinnati, Ohio, and also included visits to Birmingham, Alabama; Pittsburgh, Pennsylvania; East Haven, Connecticut; Seattle, Washington; and Richmond, California.  

A federal grand jury yesterday returned a four count indictment in the Western District of New York charging two business owners with conspiracy to defraud the United States and filing a false tax return, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney William J. Hochul Jr for the Western District of New York.  

According to the indictment, Lizhong “Tony” Shen and Xiaojie “Lucy” Shun, jointly operated BTL International Company Ltd., a tour and travel service company located in Niagara Falls, New York, between April 2004 and November 2009.  The defendants were married at the time but, in 2009, they separated and Shen stopped working for BTL International.  In January 2011, Shun ceased operation of BTL International and began operating another tour and travel service company, Niagara Falls Universal Inc.

For the tax years 2008 and 2009, Shen and Shun failed to properly report income generated by BTL International to the IRS on both corporate and personal tax returns. Both defendants also signed their 2009 personal tax return knowing the return included incorrect information.  Shen and Shun reported income in the amount of $22,880 but it is alleged they knowingly received a significantly higher income.

In addition, Shun is charged with corruptly endeavoring to obstruct the due administration of the internal revenue laws. The indictment charges that, from April 2010 through April 2013, Shun provided inaccurate information to the accounting firm preparing the 2011 tax return for Niagara Falls Universal, the 2010 and 2011 personal tax returns for the couple and the 2012 tax return for herself.

The defendants face a maximum prison term of five years on the charge of conspiracy to defraud the United States and three years for each charge of filing a false return. Shun faces an additional three year term in prison for the charge of corruptly endeavoring to obstruct the due administration of the internal revenue laws. Both defendants also face a term of supervised release and monetary penalties.

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

Acting Assistant Attorney General Ciraolo and U.S. Attorney Hochul commended special agents of the IRS- Criminal Investigation Division, under the direction of Special Agent in Charge Shantelle P. Kitchen, who are investigating the case, and Assistant U.S. Attorney Trini E. Ross and Thomas F. Koelbl of the Tax Division, who are prosecuting the case.

Two Georgia real estate investors pleaded guilty today for their roles in bid-rigging and fraud conspiracies committed at public real estate foreclosure auctions in Georgia, the Department of Justice announced today. 

Michael Stock and Jon Stovall Jr. each admitted that they agreed with other real estate investors to refrain from bidding against one another at public real estate foreclosure auctions in exchange for payoffs.  Stock admitted to participating in the conspiracy in Fulton and DeKalb counties from as early as August 2009 until at least November 2011, and Stovall admitted to participating in Fulton County from as early as October 2008 until at least January 2012.  Additionally, Stock and Stovall admitted to conspiring to use the mail to carry out a scheme to defraud homeowners and mortgage holders.

According to court documents filed today in the U.S. District Court for the Northern District of Georgia, the conspirators agreed not to compete against each other at public real estate foreclosure auctions, artificially suppressed the prices of properties sold at these auctions, and made and received payoffs from each other.  As a result, the conspirators seized money that otherwise would have gone to pay off the mortgage and other secured debt holders, and, in some cases, to the previous owner of the foreclosed home.

“These defendants conspired to take money that rightfully belonged to homeowners and lenders,” said Principal Deputy Assistant Attorney General Renata Hesse, head of the Justice Department’s Antitrust Division.  “Those homeowners and lenders have a right to expect that the properties will be sold in free and competitive auctions.  The Antitrust Division will continue to partner with our colleagues at the FBI to aggressively pursue conduct designed to disrupt that process.”

“Foreclosure auction fraud in Georgia remains a focus for the FBI investigators and federal prosecutors within the Antitrust Division of the U.S. Department of Justice.  By the very nature of this criminal act, the bank, and more importantly, the home owner in financial distress, are the victims that these federal laws were created to protect. The FBI will continue to provide investigative assets toward these matters in order to keep the level playing field that the law intended regarding these auctions.”

Including the individuals pleading today, 20 defendants have been charged in connection with the department’s ongoing investigation into bid rigging and fraudulent schemes involving real estate foreclosure auctions in the Atlanta area.  Eighteen of those have either pleaded guilty or agreed to plead guilty. 

These charges have been filed as a result of the ongoing investigation being conducted by the Antitrust Division’s Washington Criminal II Section, the FBI’s Atlanta Division and the U.S. Attorney’s Office of the Northern District of Georgia, in connection with the president’s Financial Fraud Enforcement Task Force.  The president established the task force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  With more than 20 federal agencies, 94 U.S. Attorneys’ Offices and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud.  Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations.  Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants.  For more information about the task force, please visit www.StopFraud.gov.  Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Washington Criminal II Section of the Antitrust Division at 202-598-4000, call the Antitrust Division’s Citizen Complaint Center at 888-647-3258, or visit http://www.justice.gov/atr/report-violations.

A federal grand jury in the District of Montana returned an indictment on May 18, which was unsealed yesterday, charging a resident of Montana and Nevada with one count of corrupt interference with the internal revenue laws, 10 counts of theft of government money and six counts of aggravated identity theft, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Michael W. Cotter of the District of Montana.

According to the indictment, from approximately April 2010 through at least September 2014, Steven D. Pjevach, filed false and fraudulent income tax returns using names and social security numbers that he obtained by posting false help-wanted advertisements on Craigslist.  As part of his scheme, Pjevach opened and caused to be opened bank accounts in other individuals’ names to receive the fraudulently obtained tax refunds.  Pjevach provided false information to these individuals about the reason why he was using their bank accounts and advised one of these individuals to disregard bank correspondence that advised this individual that his bank account was being used to obtain tax refunds.  

If convicted, Pjevach faces a statutory maximum sentence of three years in prison on the charge of corrupt interference with the internal revenue laws, 10 years in prison for each count of theft of government money and a mandatory sentence of two years in prison for each count of aggravated identity theft, which will be in addition to any other term of imprisonment he receives.  He also faces supervised release, a fine and restitution. 

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

Acting Assistant Attorney General Ciraolo and U.S. Attorney Cotter commended special agents of Internal Revenue Service-Criminal Investigation, who investigated the case and Trial Attorney John T. Mulcahy of the Tax Division and Assistant U.S. Attorney Chad C. Spraker of the District of Montana, who are prosecuting the case.

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

In two related settlements, one with the United States and the State of California, and one with the U.S. Federal Trade Commission (FTC), German automaker Volkswagen AG and related entities have agreed to spend up to $14.7 billion to settle allegations of cheating emissions tests and deceiving customers. Volkswagen will offer consumers a buyback and lease termination for nearly 500,000 model year 2009-2015 2.0 liter diesel vehicles sold or leased in the U.S., and spend up to $10.03 billion to compensate consumers under the program. In addition, the companies will spend $4.7 billion to mitigate the pollution from these cars and invest in green vehicle technology.

The settlements partially resolve allegations by the Environmental Protection Agency (EPA), as well as the California Attorney General’s Office and the California Air Resources Board (CARB) under the Clean Air Act, California Health and Safety Code, and California’s Unfair Competition Laws, relating to the vehicles’ use of “defeat devices” to cheat emissions tests.  The settlements also resolve claims by the FTC that Volkswagen violated the FTC Act through the deceptive and unfair advertising and sale of its “clean diesel” vehicles. The settlements do not resolve pending claims for civil penalties or any claims concerning 3.0 liter diesel vehicles.  Nor do they address any potential criminal liability.

The affected vehicles include 2009 through 2015 Volkswagen TDI diesel models of Jettas, Passats, Golfs and Beetles as well as the TDI Audi A3.

“By duping the regulators, Volkswagen turned nearly half a million American drivers into unwitting accomplices in an unprecedented assault on our environment,” said Deputy Attorney General Sally Q. Yates.  “This partial settlement marks a significant first step towards holding Volkswagen accountable for what was a breach of its legal duties and a breach of the public’s trust.  And while this announcement is an important step forward, let me be clear, it is by no means the last.  We will continue to follow the facts wherever they go.”

“Today’s settlement restores clean air protections that Volkswagen so blatantly violated,” said EPA Administrator Gina McCarthy. “And it secures billions of dollars in investments to make our air and our auto industry even cleaner for generations of Americans to come. This agreement shows that EPA is committed to upholding standards to protect public health, enforce the law, and to find innovative ways to protect clean air.”

“Today’s announcement shows the high cost of violating our consumer protection and environmental laws,” said FTC Chairwoman Edith Ramirez. “Just as importantly, consumers who were cheated by Volkswagen’s deceptive advertising campaign will be able to get full and fair compensation, not only for the lost or diminished value of their car but also for the other harms that VW caused them.”

According to the civil complaint against Volkswagen filed by the Justice Department on behalf of EPA on January 4, 2016, Volkswagen allegedly equipped its 2.0 liter diesel vehicles with illegal software that detects when the car is being tested for compliance with EPA or California emissions standards and turns on full emissions controls only during that testing process. During normal driving conditions, the software renders certain emission control systems inoperative, greatly increasing emissions. This is known as a “defeat device.”  Use of the defeat device results in cars that meet emissions standards in the laboratory, but emit harmful NOx at levels up to 40 times EPA-compliant levels during normal on-road driving conditions.  The Clean Air Act requires manufacturers to certify to EPA that vehicles will meet federal emission standards.  Vehicles with defeat devices cannot be certified.

The FTC sued Volkswagen in March, charging that the company deceived consumers with the advertising campaign it used to promote its supposedly “clean diesel” VWs and Audis, which falsely claimed that the cars were low-emission, environmentally friendly, met emissions standards and would maintain a high resale value.

The settlements use the authorities of both the EPA and the FTC as part of a coordinated plan that gets the high-polluting VW diesels off the road, makes the environment whole, and compensates consumers.

The settlements require Volkswagen to offer owners of any affected vehicle the option to have the company buy back the car and to offer lessees a lease cancellation at no cost. Volkswagen may also propose an emissions modification plan to EPA and CARB, and if approved, may also offer owners and lessees the option of having their vehicles modified to substantially reduce emissions in lieu of a buyback.  Under the U.S./California settlement, Volkswagen must achieve an overall recall rate of at least 85% of affected 2.0 liter vehicles under these programs or pay additional sums into the mitigation trust fund.  The FTC order requires Volkswagen to compensate consumers who elect either of these options. 

Volkswagen must set aside and could spend up to $10.03 billion to pay consumers in connection with the buy back, lease termination, and emissions modification compensation program. The program has different potential options and provisions for affected Volkswagen diesel owners depending on their circumstances:

Buyback option: Volkswagen must offer to buy back any affected 2.0 liter vehicle at  their retail value as of September 2015 -- just prior to the public disclosure of the emissions issue. Consumers who choose the buyback option will receive between $12,500 and $44,000, depending on their car’s model, year, mileage, and trim of the car, as well as the region of the country where it was purchased. In addition, because a straight buyback will not fully compensate consumers who owe more than their car is worth due to rapid depreciation, the FTC order provides these consumers with an option to have their loans forgiven by Volkswagen.  Consumers who have third party loans have the option of having Volkswagen pay off those  loans, up to 130 percent of the amount a consumer would be entitled to under the buyback (e.g., if the consumer is entitled to a $20,000 buyback, VW would pay off his/her loans up to a cap of $26,000).

EPA-approved modification to vehicle emissions system: The settlements also allow Volkswagen to apply to EPA and CARB for approval of an emissions modification on the affected vehicles, and, if approved, to offer consumers the option of keeping their cars and having them modified to comply with emissions standards.  Under this option in accordance with the FTC order, consumers would also receive money from Volkswagen to redress the harm caused by VW’s deceptive advertising. 

Consumers who leased the affected cars will have the option of terminating their leases (with no termination fee) or having their vehicles modified if a modification becomes available.  In either case, under the FTC order, these consumers also will receive additional compensation from Volkswagen for the harm caused by VW’s deceptive advertising.  Consumers who sold their TDI vehicles after the VW defeat device issue became public may be eligible for partial compensation, which will be split between them and the consumers who purchased the cars from them as set forth in the FTC order.

Eligible consumers will receive notice from VW after the orders are entered by the court this fall. Consumers will be able to see if they are eligible for compensation and if so, what options are available to them, at VWCourtSettlement.com and AudiCourtSettlement.com. They will also be able to use these websites to make claims, sign up for appointments at their local Volkswagen or Audi dealers and receive updates.  Consumer payments will not be available until the settlements take effect if and when approved by the court, which may be as early as October 2016.

Emissions Reduction Program: The settlement of the company’s Clean Air Act violations also requires Volkswagen to pay $2.7 billion to fund projects across the country that will reduce emissions of NOx where the 2.0 liter vehicles were, are or will be operated. Volkswagen will place the funds into a mitigation trust over three years, which will be administered by an independent trustee.  Beneficiaries, which may include states, Puerto Rico, the District of Columbia, and Indian tribes, may obtain funds for designated NOx reduction projects upon application to the Trustee. Funding for the designated projects is expected to fully mitigate the NOx these 2.0 liter vehicles have and will emit in excess of EPA and California standards.

The emissions reduction program will help reduce NOx pollution that contributes to the formation of harmful smog and soot, exposure to which is linked to a number of respiratory- and cardiovascular-related health effects as well as premature death. Children, older adults, people who are active outdoors (including outdoor workers), and people with heart or lung disease are particularly at risk for health effects related to smog or soot exposure. NO2 formed by NOx emissions can aggravate respiratory diseases, particularly asthma, and may also contribute to asthma development in children.

Zero Emissions Technology Investments: The Clean Air Act settlement also requires VW to invest $2 billion toward improving infrastructure, access and education to support and advance zero emission vehicles. The investments will be made over 10 years, with $1.2 billion directed toward a national EPA-approved investment plan and $800 million directed toward a California-specific investment plan that will be approved by CARB.  As part of developing the national plan, Volkswagen will solicit and consider input from interested states, cities, Indian tribes and federal agencies. This investment is intended to address the adverse environmental impacts from consumers’ purchases of the 2.0 liter vehicles, which the governments contend were purchased under the mistaken belief that they were lower emitting vehicles.

FTC’s Injunctive Relief: The FTC settlement includes injunctive provisions to protect consumers from deceptive claims in the future.  These provisions prohibit Volkswagen from making any misrepresentations that would deceive consumers about the environmental benefits or value of its vehicles or services, and the order specifically bans VW from employing any device that could be used to cheat on emissions tests. 

The provisions of the U.S./California settlement are contained in a proposed consent decree filed today in the U.S. District Court for the Northern District of California, as part of the ongoing multi-district litigation, and will be subject to public comment period of 30 days, which will be announced in the Federal Register in the coming days.  The provisions of the FTC settlement are contained in a proposed Stipulated Final Federal Court Order filed today in the same court. 

To view the consent decree, visit: www.justice.gov/enrd/consent-decrees

To view the FTC proposed order, visit: https://www.ftc.gov/enforcement/cases-proceedings/162-3006/volkswagen-group-america-inc.

Consumer Fact Sheet

VW Partial 2L CD and Appendices

VW Notice of Lodging

Manager of North Carolina Tax Preparation Business Underreported Net Profits

A Fulshear, Texas, woman was sentenced to 40 months in prison today following her conviction on three counts of filing false federal tax returns and one count of corruptly endeavoring to obstruct and impede the due administration of the internal revenue laws, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.

Tamny Denise Westbrooks, 53, was convicted in November 2015 after a four-day jury trial in the U.S. District Court for the Southern District of Texas.  According to the evidence at trial and court documents, Westbrooks was the day-to-day manager of JATS Tax Service, a tax preparation business located in Charlotte, North Carolina.  Westbrooks, who worked for JATS as an independent contractor, underreported her net profits by inflating her business expenses for tax years 2007, 2008 and 2009.  She also obstructed and impeded the Internal Revenue Service (IRS) by filing false tax returns for herself and others and by paying workers in cash while failing to file the required W-2 or 1099 forms reporting their compensation. 

In addition to her term of imprisonment, Westbrooks was ordered to serve one year of supervised release and to pay restitution in the amount of $273,460 to the IRS.

Acting Assistant Attorney General Ciraolo commended special agents of IRS-Criminal Investigation, who investigated the case and Trial Attorneys Sean Beaty and Mara Strier of the Justice Department’s Tax Division, who prosecuted the case.  Acting Assistant Attorney General Ciraolo also thanked the U.S. Attorney’s Office of the Southern District of Texas for their substantial assistance.

The Justice Department reached an agreement today with Crookham Company to resolve the department’s allegations that the company discriminated against work-authorized non-U.S. citizens, in violation of the Immigration and Nationality Act (INA).  Crookham, which is based in Caldwell, Idaho, is a seed company that produces hybrid sweet corn, popcorn and onions.

The department’s investigation found that Crookham discriminated against non-U.S. citizens by requiring them to produce either a permanent resident card or employment authorization card to prove their work authorization, whereas U.S. citizens were permitted to choose whichever valid documentation they wanted to present to prove their work authorization.  Under the INA, all workers, including non-U.S. citizens, can choose whichever valid documentation they would like to present from the lists of acceptable documents to prove their work authorization.  It is unlawful for an employer to limit employees’ choice of documentation because of their citizenship or immigration status.

“We commend Crookham Company for its cooperation throughout the investigation and for its quick action to remove any unnecessary and unlawful barriers to employment for work-authorized non-citizens,” said Principal Deputy Assistant Attorney General Vanity Gupta, head of the Justice Department’s Civil Rights Division.  “The company’s approach and this settlement serve as a model for partnerships between the Justice Department and employers who want to do the right thing.”

Under the settlement agreement, Crookham will pay $200,000 in civil penalties to the United States and be subject to monitoring for a three-year period.  Prior to the settlement, Crookham proactively underwent department-provided training on the anti-discrimination provision of the INA and voluntarily implemented other measures to ensure future compliance.

The Civil Rights Division’s Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) is responsible for enforcing the anti-discrimination provision of the INA.  The statute prohibits, among other things, citizenship status and national origin discrimination in hiring, firing or recruitment or referral for a fee; document abuse; retaliation and intimidation.  The investigation was handled by Senior Equal Opportunity Specialist Alexandra A. Vince of OSC.

For more information about protections against employment discrimination under immigration laws, call OSC’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call OSC’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar at www.justice.gov/crt/about/osc/webinars.php; email osccrt@usdoj.gov or visit OSC’s website at www.justice.gov/crt/about/osc.

Applicants or employees who believe they were subjected to: different documentary requirements based on their citizenship status, immigration status or national origin; or discrimination based on their citizenship status, immigration status or national origin in hiring, firing or recruitment or referral, should contact the worker hotline above for assistance.

Crookham Company Settlement Agreement

The Justice Department announced today that it has reached an agreement with the Kentucky Administrative Office of the Courts to resolve its review of the provision of language assistance service to limited English proficient (LEP) state court users.

The department began working with the Kentucky Administrative Office of the Courts after receiving a complaint alleging national origin discrimination under Title VI of the Civil Rights Act of 1964, following a state court judge’s failure to provide interpreter services to LEP parties.  Title VI requires recipients of federal financial assistance, such as courts, to provide competent language services to LEP individuals in all court proceedings and operations.

During the course of the department’s review, the Kentucky Administrative Office of the Courts has strengthened its language access programming.  Such efforts include creating and implementing a language services complaint system to be translated into a dozen non-English languages, training court staff on the importance of providing appropriate language services and developing systems to improve the efficiency and quality of interpreter services and translations.

As a condition of the agreement, the Kentucky Administrative Office of the Courts has agreed to a 12-month monitoring phase, during which it will provide quarterly updates to the department regarding any developments related to providing language services, as well as any new complaints alleging failure to provide appropriate language assistance services.

“I commend the Kentucky Administrative Office of the Courts for committing to ensure that all individuals, regardless of the language they speak, can fully and fairly access court services and proceedings,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division.  “We look forward to working collaboratively to continue these critical efforts and ensure equal access to justice for all.”

The case was handled by Attorney Dylan Nicole de Kervor of the Civil Rights Division’s Federal Coordination and Compliance (FCS) Section.

The complaint was resolved as part of the FCS court initiative to ensure that state courts comply with Title VI’s language access requirements.  No LEP individual should be denied justice because a court fails to provide language services.  The FCS courts team provides policy guidance and technical assistance to state court systems and undertakes enforcement actions across the country.

For further information about FCS and Title VI, please visit https://www.justice.gov/crt/fcs.  For additional LEP-related resources, please visit http://www.lep.gov/index.htm. 

Kentucky Courts

The Department of Justice announced that a former California licensed attorney pleaded guilty in U.S. District Court in Santa Ana, California, for his role in a multi-million dollar fraudulent mortgage modification scheme. 

Ronald Rodis, 51, of Irvine, California, pleaded guilty before U.S. District Court Judge David O. Carter for the Central District of California to one count of conspiracy to commit mail and wire fraud. 

“At the height of the mortgage crisis, this defendant and his co-conspirators preyed on desperate homeowners with a series of lies and false promises,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “We will continue to prosecute individuals who target vulnerable victims for profit.”

“This defendant posed as an accomplished attorney who could provide quality legal services – and hope – to struggling homeowners,” said U.S. Attorney Eileen Decker of the Central District of California. “But the promises were bogus. Rodis Law Group made few efforts to assist homeowners, who paid thousands of dollars in last-ditch attempts to keep their homes, many of which entered foreclosure.”

Rodis admitted that, between October 2008 and June 2009, he participated in a scheme with Bryan D’Antonio, Charles Wayne Farris, and others to induce homeowners to pay between $3,500 and $5,500 for the services of the Rodis Law Group (RLG).  Rodis and his co-conspirators made numerous misrepresentations regarding the RLG’s ability to negotiate loan modifications from the homeowners’ mortgage lenders. Rodis recorded radio advertisements encouraging struggling homeowners to call RLG.  In the radio ads, Rodis falsely claimed that RLG consisted of “a team of experienced attorneys” who were “highly skilled in negotiating lower interest rates and even lowering your principal balance.”  In fact, RLG was a telemarketing operation that never had a team of experienced attorneys.  During much of the scheme, Rodis was the only attorney at RLG.

When homeowners called RLG, telemarketers made further misrepresentations to convince the homeowners to hire RLG.  Telemarketers stated that RLG had been in business for 11 years when in fact it had only opened in October 2008.  They falsely stated that RLG routinely obtained positive results for homeowners, including lower monthly payments, reductions in principal balance and lower interest rates.  In fact, positive results were rarely achieved for any RLG clients.  Telemarketers also falsely reiterated that homeowners would have a team of attorneys and real estate professionals assigned to their case.      

“It is an unfortunate truth that people often take advantage of a crisis for personal gain,” said Assistant Director in Charge Deirdre Fike of the FBI’s Los Angeles Field Office.  “The Rodis Law Group was among the worst type of scammers, trying to take advantage of homeowners already experiencing profund heartache in the face of potential foreclosure.  The FBI will not tolerate this kind of criminal behavior.  I truly hope that when the next financial crisis arises, members of the public take a moment to look into claims that sound too good to be true, even if those claims are made by attorneys, before would-be clients become victims.”

Rodis’s co-defendants, Bryan D’Antonio and Charles Wayne Farris, are each charged with 10 felony counts – nine counts of wire fraud and one count of conspiracy.  Each of these counts carries a statutory maximum penalty of 20 years in prison.  In addition, D’Antonio is charged with 13 counts of criminal contempt for violating a 2001 federal court order, which permanently banned D’Antonio from participating in future telemarketing operations.  Criminal contempt of court has no statutory maximum penalty.  D’Antonio and Farris are scheduled for trial beginning Sept. 20.

This case was investigated by the FBI and is being prosecuted by Trial Attorney John W. Burke of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Joseph T. McNally of the Central District of California.

For more information about the Consumer Protection Branch, visit its website at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Central District of California, visit its website at https://www.justice.gov/usao-cdca.

WASHINGTON, D.C. – El Departamento de Justicia anunció hoy que ha realizado un acuerdo con la Oficina Administrativa de Tribunales de Kentucky (en inglés) para resolver su revisión del suministro de servicios de apoyo lingüístico a usuarios del sistema judicial con conocimientos limitados del inglés [Limited English Proficient (LEP)].  

El Departamento comenzó a trabajar con la Oficina Administrativa de Tribunales de Kentucky después de recibir una queja que alegaba discriminación por motivos de nacionalidad de origen al amparo el Título VI de la ley de Derechos Civiles de 1964, después de que un juez estatal dejara de brindar servicios de interpretación a partes LEP. El Título VI exige que los beneficiarios de asistencia financiera federal, tales como los tribunales, brinden servicios idiomáticos competentes a personas LEP en todos los procesos y trámites judiciales.

Durante la revisión realizada por el Departamento, la Oficina Administrativa de Tribunales de Kentucky ha fortalecido su programación de acceso lingüístico. Dicha iniciativa incluye la creación e implementación de un sistema de quejas relacionadas con los servicios lingüísticos, a ser traducido a una decena de idiomas que no sean el inglés, la capacitación del personal judicial en cuanto a la importancia de proveer servicios lingüísticos adecuados y el desarrollo sistemas que mejoren la eficiencia y calidad de los servicios de interpretación y las traducciones.

Como condición de la resolución, la Oficina Administrativa de Tribunales de Kentucky se ha comprometido a una fase de monitoreo de 12 meses de duración, durante la cual proveerá actualizaciones trimestrales al Departamento acerca de cualquier novedad asociada con la provisión de servicios lingüísticos, así como cualquier queja nueva que alegue que se dejaron de brindar servicios de apoyo lingüístico adecuados.

“Felicito a la Oficina Administrativa de Tribunales de Kentucky por comprometerse a asegurar que todas las personas, sin importar el idioma que hablen, puedan tener acceso integral y justo a servicios y procesos judiciales,” señaló la Secretaria de Justicia Auxiliar Adjunta Principal Vanita Gupta, Jefa de la División de Derechos Civiles del Departamento de Justicia.  “Nos complacerá trabajar en conjunto para continuar con esta labor esencial y garantizar el acceso igualitario a la justicia para todos.”

Estuvo a cargo del caso el Abogado Dylan Nicole de Kervor de la Sección de Coordinación y Cumplimiento Federal [Federal Coordination and Compliance (FCS)] de la División de Derechos Civiles.

La queja fue resuelta como parte de la iniciativa judicial de la FCS para garantizar que los tribunales estatales cumplan con las exigencias de acceso lingüístico del Título VI. No se le debe negar la justicia a ninguna persona LEP porque el tribunal deje de proveer servicios lingüísticos.  El equipo judicial de la FCS (en inglés) provee orientación sobre políticas y apoyo técnico a sistemas judiciales estatales e implementa acciones de aplicación de la ley en todo el país.

Para más información sobre la FCS y el Título VI, visite www.justice.gov/crt/fcs (en inglés). Para recursos adicionales relacionados con las personas LEP, visite www.lep.gov/index.htm (en inglés). 

FALLS CHURCH, VA – The Executive Office for Immigration Review (EOIR) today announced the investiture of 15 immigration judges. Acting Chief Immigration Judge Michael C. McGoings presided over the investiture during a ceremony held June 17, 2016, at the U.S. Court of Appeals for the Armed Forces in Washington, D.C.

After a thorough application process, Attorney General Loretta E. Lynch appointed Nathan N. Aina, John B. Carle, Barbara J. Cigarroa, John G. Crews II, John P. Ellington, Justin W. Howard, Alison R. Kane, James M. Left, Clay N. Martin, Donald C. O’Hare, Jeannette L. Park, Ana L. Partida, Georgina M. Picos, Jayme Salinardi, and Sandra J. Santos-Garcia to their new positions.

“We are pleased to welcome these 15 appointees to the immigration judge corps,” said McGoings. “Their arrival brings our immigration judge corps to 273 adjudicators, our highest level to date.”

Biographical information follows.

Nathan N. Aina, Immigration Judge, Los Angeles Immigration Court

Attorney General Loretta E. Lynch appointed Nathan N. Aina to begin hearing cases in June 2016. Judge Aina earned a Bachelor of Science degree in 1997, and a Master of Public Administration and a Juris Doctor in 2001, all from Brigham Young University. From 2002 to May 2016, Judge Aina served as an assistant chief counsel for Immigration and Customs Enforcement, Department of Homeland Security, entering on duty through the Attorney General’s Honors Program. Judge Aina is a member of the Utah State Bar.

John B. Carle, Immigration Judge, Philadelphia Immigration Court

Attorney General Loretta E. Lynch appointed John B. Carle to begin hearing cases in June 2016. Judge Carle earned a Bachelor of Arts degree in 1990 from the State University of New York at Binghamton and a Juris Doctor in 1993 from the State University of New York at Buffalo Law School. From 2007 to May 2016, Judge Carle served as an assistant chief counsel for the Office of the Chief Counsel, Immigration and Customs Enforcement, Department of Homeland Security. From 2000 through 2007, Judge Carle served as an assistant district attorney for the City of Philadelphia District Attorney’s Office. From 1995 through 2000, Judge Carle served as an assistant district attorney for the Erie County District Attorney’s Office, in Buffalo, N.Y. From 1993 through 1995, Judge Carle served as an associate attorney for Magner, Love & Morris PC, in Buffalo, N.Y. In 2013, Judge Carle joined the faculty of the Villanova University School of Law where he serves as an adjunct professor. Judge Carle is a member of the Pennsylvania Bar.

Barbara Cigarroa, Immigration Judge, Port Isabel Immigration Court

Attorney General Loretta E. Lynch appointed Barbara Cigarroa to begin hearing cases in June 2016. Judge Cigarroa earned a Bachelor of Arts degree in 1978 from Harvard University, a Master of Social Work degree in 1993 from Washington University, and a Juris Doctor in 1993 from the Washington University School of Law. From 2008 to May 2016, Judge Cigarroa served as a senior attorney for Immigration and Customs Enforcement (ICE), Department of Homeland Security (DHS). From 2003 through 2008, Judge Cigarroa served as an assistant chief counsel for ICE, DHS. From 1993 through 2003, Judge Cigarroa served as a trial attorney for the former Immigration and Naturalization Service, Department of Justice, entering on duty through the Attorney General’s Honors Program. Judge Cigarroa is a member of the State Bar of Texas.

John G. Crews II, Immigration Judge, Port Isabel Immigration Court

Attorney General Loretta E. Lynch appointed John G. Crews II to begin hearing cases in June 2016. Judge Crews earned a Bachelor of Liberal Studies degree in 1981 from Boston University and a Juris Doctor in 1985 from Southern Methodist University. From 1997 to May 2016, Judge Crews served as an assistant U.S. attorney for the District of New Mexico, U.S. Attorney’s Office, Department of Justice (DOJ). From 1987 through 1997, Judge Crews served as an assistant U.S. attorney for the Southern District of Texas, U.S. Attorney’s Office, DOJ. From 1985 through 1987, Judge Crews served as a judicial law clerk for the late-Honorable Sam B. Hall Jr., U.S. District Court, Eastern District of Texas. Judge Crews is a member of the State Bar of New Mexico.

John P. Ellington, Immigration Judge, York Immigration Court

Attorney General Loretta E. Lynch appointed John P. Ellington to begin hearing cases in June 2016. Judge Ellington earned a Bachelor of Science degree in 1990 from Georgia State University, a Juris Doctor in 1993 from the Dickinson School of Law, and a Master of Liberal Arts degree in 2014 from the University of Pennsylvania. From 2014 to May 2016, Judge Ellington served as general counsel and from 2002 to 2014 as government trial counsel, for Immigration and Customs Enforcement, Department of Homeland Security. From 2000 through 2002, Judge Ellington served as deputy attorney general for the Fraud Section, Pennsylvania Office of the Attorney General, in Norristown, Pa. From 1997 through 2000, Judge Ellington served as an assistant district attorney for the Office of the Berks County District Attorney, in Reading, Pa. Since 1991, Judge Ellington has served in various capacities for the U.S. Navy Judge Advocate General’s Corps, including: from 2014 through 2018, as a military judge; from 2012 through 2014, as senior judge advocate for investigations and inspections; and from 2009 through 2012, and previously from 2003 through 2006, as a staff judge advocate. Judge Ellington is a member of the Pennsylvania Bar.

Justin W. Howard, Immigration Judge, Kansas City Immigration Court

Attorney General Loretta E. Lynch appointed Justin W. Howard to begin hearing cases in June 2016.  Judge Howard earned a Bachelor of Arts degree in 1998 from Kansas State University and a Juris Doctor in 2002 from American University, Washington College of Law.  From 2008 to May 2016, Judge Howard served as an assistant chief counsel for the Office of the Chief Counsel, Immigration and Customs Enforcement, Department of Homeland Security.  From 2006 through 2008, Judge Howard served as an associate attorney for Shook, Hardy & Bacon LLP, in Kansas City.  From 2002 through 2005, Judge Howard served as an assistant state’s attorney for the Miami-Dade Office of the State Attorney, in Miami.  Judge Howard is a member of the Florida, Kansas and Missouri Bars.

Alison R. Kane, Immigration Judge, Denver Immigration Court

Attorney General Loretta E. Lynch appointed Alison R. Kane to begin hearing cases in June 2016.  Judge Kane earned a Bachelor of Arts degree in 1997 from Syracuse University and a Juris Doctor in 2003 from the Boston College Law School.  From 2010 to May 2016, Judge Kane served as an assistant chief counsel for Immigration and Customs Enforcement, Department of Homeland Security.  From January 2010 through June 2010, and previously from 2005 through 2007, Judge Kane served as an associate for Fragomen, Del Rey, Bernsen & Loewy LLP, in New York City and Philadelphia.  From 2003 through 2005, Judge Kane served as an attorney advisor for the Executive Office for Immigration Review, Department of Justice, entering on duty through the Attorney General’s Honors Program.  From 1997 through 1999, Judge Kane served in the Peace Corps, in Guinea, Africa.  Judge Kane is a member of the New York State Bar.

James M. Left, Immigration Judge, Adelanto Immigration Court

Attorney General Loretta E. Lynch appointed James M. Left to begin hearing cases in June 2016. Judge Left earned a Bachelor of Arts degree in 1988 from Pacific Lutheran University and a Juris Doctor in 1994 from the Pepperdine University School of Law. From 2013 to May 2016, and previously from 2008 through 2009, Judge Left served as a senior attorney for Immigration and Customs Enforcement (ICE), Department of Homeland Security (DHS). From 2009 through 2013, and previously from 2007 through 2008, Judge Left served as a special assistant U.S. attorney for the U.S. Attorney’s Office, in Los Angeles. From 2004 through 2007, Judge Left served as an assistant chief counsel for ICE, DHS. From 2002 through 2004, Judge Left served as an associate legal advisor for the National Security Law Division, ICE, DHS. From 1997 through 2002, Judge Left served as an assistant district counsel for the former Immigration and Naturalization Service, Department of Justice. Judge Left is a member of the State Bar of California.

Clay N. Martin, Immigration Judge, Pearsall Immigration Court

Attorney General Loretta E. Lynch appointed Clay N. Martin to begin hearing cases in June 2016. Judge Martin earned a Bachelor of Arts degree in 1984 from Hendrix College and a Juris Doctor in 1987 from the St. Mary’s University School of Law. From 2008 through May 2016, Judge Martin served as a senior attorney for the Office of the Chief Counsel (OCC), Immigration and Customs Enforcement (ICE), Department of Homeland Security (DHS). From 2002 through 2007, Judge Martin served as an assistant chief counsel for OCC, ICE, DHS. From 1995 through 2002, Judge Martin served as chief deputy prosecuting attorney for the 18th West Judicial District Prosecuting Attorney’s Office, in Polk and Montgomery counties, Ark. From 1992 through 1995, Judge Martin served as an assistant district attorney for the Bexar County District Attorney’s Office, in San Antonio. From 1989 through 1991, Judge Martin served as an attorney for Riddle and Brown, in Dallas. From 1988 through 1989, Judge Martin served as an attorney for Soules and Wallace, in San Antonio. From 1987 through 1988, Judge Martin served as an attorney for Hill, Heard, Oneal, Gilstrap & Goetz, in Arlington, Texas. Judge Martin is a member of the Arkansas Bar and the State Bar of Texas.

Donald C. O’Hare, Immigration Judge, Denver Immigration Court

Attorney General Loretta E. Lynch appointed Donald C. O’Hare to begin hearing cases in June 2016. Judge O’Hare earned a Bachelor of Arts degree in 1984 from Macalester College, a Master of Arts degree in 1987 from the University of Minnesota, a Juris Doctor in 1992 from the California Western School of Law, and a Master of Laws degree in 1994 from the University of Virginia School of Law. From 2003 to May 2016, Judge O’Hare served in several capacities, including as deputy chief counsel, assistant chief counsel, and a senior attorney for the Office of the Chief Counsel, Immigration and Customs Enforcement, Department of Homeland Security. From 1997 through 2003, Judge O’Hare served as an assistant district counsel for the former Immigration and Naturalization Service, Department of Justice. From 1992 through 1993, Judge O’Hare was a staff attorney for the Pension Benefit Guaranty Corp., in Washington, D.C. Judge O’Hare is a member of the State Bar of California.

Jeannette L. Park, Immigration Judge, Los Angeles Immigration Court

Attorney General Loretta E. Lynch appointed Jeannette L. Park to begin hearing cases in June 2016. Judge Park earned a Bachelor of Arts degree in 1996 from the University of California, Berkeley, and a Juris Doctor in 2000 from the Boston College Law School. From 2003 to May 2016, Judge Park served as an assistant chief counsel for the Office of the Chief Counsel, Immigration and Customs Enforcement, Department of Homeland Security. From 2000 through 2003, Judge Park served as an assistant district counsel for the former Immigration and Naturalization Service, Department of Justice. Judge Park is a member of the State Bar of California.

Ana L. Partida, Immigration Judge, Los Angeles Immigration Court

Attorney General Loretta E. Lynch appointed Ana L. Partida to begin hearing cases in June 2016. Judge Partida earned a Bachelor of Arts degree in 1996 from San Diego State University, a Master of Forensic Sciences degree in 1998 from National University, and a Juris Doctor in 2002 from the New England School of Law. From 2003 to May 2016, Judge Partida served as an assistant chief counsel for the Office of the Chief Counsel (OCC), Immigration and Customs Enforcement (ICE), Department of Homeland Security (DHS). From 2002 through 2003, Judge Partida served as an assistant district counsel for the former Immigration and Naturalization Service, Department of Justice. Judge Partida is a member of the New Jersey State Bar.

Georgina M. Picos, Immigration Judge, Houston Immigration Court

Attorney General Loretta E. Lynch appointed Georgina M. Picos to begin hearing cases in June 2016. Judge Picos earned a Bachelor of Business Administration degree in 1987 from Florida International University and a Juris Doctor in 1991 from St. Thomas University School of Law. From 1994 to May 2016, Judge Picos served as an assistant chief counsel for the Office of the Chief Counsel, Immigration and Customs Enforcement, Department of Homeland Security. From 1992 through 1994, Judge Picos served as an associate attorney for the Law Offices of Magda Montiel Davis PA, in Miami. From 1991 through 1992, Judge Picos served as a judicial law clerk for the Miami Immigration Court, Executive Office for Immigration Review, Department of Justice, entering on duty through the Attorney General’s Honors Program. Judge Picos is a member of the Florida Bar.

Jayme Salinardi, Immigration Judge, Kansas City Immigration Court

Attorney General Loretta E. Lynch appointed Jayme Salinardi to begin hearing cases in June 2016. Judge Salinardi earned a Bachelor of Arts degree in 1994 from the University of Missouri-Columbia and a Juris Doctor in 1999 from the University of Missouri-Columbia. From 2012 to May 2016, Judge Salinardi served as deputy chief counsel for the Office of the Chief Counsel (OCC), Immigration and Customs Enforcement (ICE), Department of Homeland Security (DHS). From 2003 through 2012, Judge Salinardi served as assistant chief counsel and senior attorney for OCC, ICE, DHS. From 2000 through 2003, Judge Salinardi served as an immigration attorney for Fallon, Bixby, Cheng & Lee, in San Francisco. In 2011, Judge Salinardi joined the faculty of the University of Missouri School of Law where he serves as an adjunct professor of law. Judge Salinardi is a member of the State Bar of California.

Sandra J. Santos-Garcia, Immigration Judge, Adelanto Immigration Court

Attorney General Loretta E. Lynch appointed Sandra J. Santos-Garcia to begin hearing cases in June 2016. Judge Santos-Garcia earned a Bachelor of Arts degree in 1998 and a Juris Doctor in 2001, both from the University of California, Berkeley. From 2010 through 2016, Judge Santos-Garcia served as a senior attorney for the Office of the Chief Counsel (OCC), Immigration and Customs Enforcement (ICE), Department of Homeland Security (DHS). From 2001 through 2010, Judge Santos-Garcia served as assistant chief counsel for OCC, ICE, DHS. Judge Santos-Garcia is a member of the State Bars of Arizona and California.

- EOIR -

The Executive Office for Immigration Review (EOIR) is an agency within the Department of Justice. Under delegated authority from the Attorney General, immigration judges and the Board of Immigration Appeals interpret and adjudicate immigration cases according to United States immigration laws. EOIR's immigration judges conduct administrative court proceedings in immigration courts located throughout the nation. They determine whether foreign-born individuals—whom the Department of Homeland Security charges with violating immigration law—should be ordered removed from the United States or should be granted relief from removal and be permitted to remain in this country. The Board of Immigration Appeals primarily reviews appeals of decisions by immigration judges. EOIR's Office of the Chief Administrative Hearing Officer adjudicates immigration-related employment cases. EOIR is committed to ensuring fairness in all of the cases it adjudicates.

The U.S. District Court for the Eastern District of California entered a consent decree of permanent injunction against Wa Heng Dou-Fu & Soy Sauce Corporation doing business as Wa Heng Dou-Fu & Soy Sauce International Enterprises (Wa Heng) and the firm’s co-owners, Peng Xiang “Martin” Lin and Yuexiao “Opal” Lin, to prevent the distribution of adulterated and misbranded soy products, the Department of Justice announced today.

The Department filed a complaint in the Eastern District of California on June 17, at the request of the U.S. Food and Drug Administration (FDA).  The complaint alleged that the defendants violated the Food, Drug and Cosmetic Act by causing food that is held for sale after shipment of one or more of its components in interstate commerce to become adulterated and misbranded.  According to the complaint, the defendants have an extensive history of operating their food manufacturing facility under insanitary conditions, failing to follow current good manufacturing practice requirements and misbranding their food products.

“The American public deserves to be assured that companies and individuals preparing and distributing food subject to the Food, Drug and Cosmetic Act are complying with federal law,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Department of Justice’s Civil Division.  “The Department of Justice will continue to work aggressively with the FDA to ensure a safe food supply.”

As detailed in the complaint, the company receives, prepares, processes, manufactures, packs, labels, holds and distributes soy products including fried tofu, firm tofu, seasoned tofu and soy drinks.  The complaint alleged that Martin Lin’s responsibilities include the firm’s daily operations, raw material purchases, facility and equipment maintenance and production schedule and that Opal Lin’s responsibilities include training employees and overseeing employee performance.

In conjunction with the filing of the complaint, the defendants agreed to settle the case and to be bound by a permanent injunction that requires Wa Heng to cease all food preparation, manufacturing and distribution.  If the defendants seek to resume preparing, manufacturing and distributing food, they must implement remedial measures set forth in the injunction, notify FDA of the measures taken, and receive written notification from FDA that they appear to be in compliance with the remedial requirements set forth in the injunction and the Food, Drug and Cosmetic Act.    

According to the complaint, the defendants had a history of repeated violations.  A 2015 inspection by FDA documented that the defendants failed to take reasonable precautions to ensure that production procedures do not contribute to contamination from any source.  For example, as alleged in the complaint, FDA observed at least three employees spraying pressurized water from a water hose onto the production area floor, where FDA isolated Salmonella Havana, causing water to splash from the floor onto uncovered tofu and onto food contact surfaces, such as tofu presses and a filtration table.  This was a repeat observation from the FDA’s 2012 inspection.  In addition, FDA observed employees touching the bottoms of buckets and crates that had been on the floor and then touching tofu.  The hand wash sink in the production room had no hot water because the valve had been turned off and the sink was inaccessible due to crates in front of it.  This was also a repeat observation from the 2012 inspection.

According to the complaint, the most recent inspection also found that the defendants failed to maintain equipment and utensils in an acceptable fashion through appropriate cleaning and sanitizing.  FDA observed spray hose nozzles, air valves, water valves and light switches that contained heavy residue, as well as a tofu cutting knife that was placed on top of a tofu press with greenish-brown buildup and then used to slice tofu.

Further, the complaint alleged that during the 2015 inspection, FDA conducted environmental sampling of the facility and five subsamples tested positive for pathogenic Salmonella Havana.  According to the complaint, the positive samples were taken from, among other places, a floor drain near a cooking tank, a caster wheel on a cart carrying tofu and the floor between the packing and processing rooms.  As noted in the complaint, FDA isolated a nearly identical strain of Salmonella Havana during its 2011 and 2012 inspections.  

During the 2015 inspection, FDA also collected samples of the defendants’ product labeling.  The complaint alleges that the defendants’ products are misbranded because, among other things, some of the firm’s soy products fail to include a label containing an accurate statement of the quantity of the contents in terms of weight, measure, or numerical count.

“Firms and individuals that violate federal food safety regulations pose a danger to public health,” said Acting U.S. Attorney Phillip A. Talbert of the Eastern District of California.  “The Department will not hesitate to hold companies and individuals accountable in order to protect the American people from adulterated food.”

The government is represented by Trial Attorney Raquel Toledo of the Civil Division’s Consumer Protection Branch, with the assistance of Assistant U.S. Attorney Colleen Kennedy of the Eastern District of California and Associate Chief Counsel for Enforcement Charlotte Hinkle of the Department of Health and Human Services’ Office of General Counsel’s Food and Drug Division.

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Eastern District of California, visit its website at https://www.justice.gov/usao-edca.

The Department of Justice announced today that it will train all of its law enforcement agents and prosecutors to recognize and address implicit bias as part of its regular training curricula.  The new training, based on the latest social science research and best practices in law enforcement, will begin across the department in the next few weeks.  Deputy Attorney General Sally Q. Yates sent a memo to all law enforcement agents and prosecutors today informing them of the new Implicit Bias Training Program and its importance to a strong and fair criminal justice system.

“Our officers are more effective and our communities are more secure when law enforcement has the tools and training they need to address today’s public safety challenges,” said Attorney General Loretta E. Lynch.  “At the Department of Justice, we are committed to ensuring that our own personnel are well trained in the core principles and best practices of community policing.  Today’s announcement is an important step in our ongoing efforts to promote fairness, eliminate bias and build the stronger, safer, more just society that all Americans deserve.”

“The Department of Justice has a responsibility to do everything we can to ensure that our criminal justice system is fair and impartial,” said Deputy Attorney General Yates.  “Given that the research is clear that most people experience some degree of unconscious bias, and that the effects of that bias can be countered by acknowledging its existence and utilizing response strategies, it is essential that we provide implicit bias training to all of our prosecutors and law enforcement agents.  Along with the heads of our law enforcement agencies, I’m looking forward to participating in DOJ’s very first training session tomorrow morning.”

Through the new training, over 28,000 department employees will learn how to recognize and address their own implicit bias, which are the unconscious or subtle associations that individuals make between groups of people and stereotypes about those groups.  Implicit bias can affect interactions and decisions due to race, ethnicity, gender, sexual orientation, religion and socio-economic status, as well as other factors.  Social science has shown that all individuals experience some form of implicit bias but that the effects of those biases can be countered through training. 

In the coming weeks, the department will begin rolling out the training to the more than 23,000 agents employed by the FBI,  Drug Enforcement Administration (DEA), Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and U.S. Marshals Service (USMS), as well as the approximately 5,800 attorneys working in the 94 U.S. Attorney’s Offices across the country.  As the project continues, the department will expand training to other personnel, including prosecutors in the department’s litigating components and agents of the Office of the Inspector General.

Since 2010, the department’s Office of Community Oriented Policing Services has worked with state and local law enforcement to train over 2,600 law enforcement officers at both the line and supervisor level in its implicit bias program known as Fair and Impartial Policing.  For the department’s new internal training, curricula have been created to address the work of prosecutors and federal law enforcement and the different missions of the law enforcement components.  Each law enforcement component’s curriculum includes three levels of training based on how implicit bias may affect the duties for line personnel, supervisors and managers, and executive personnel.  

In order to lead by example, on Tuesday, Deputy Attorney General Yates will be joined by the leadership of FBI, ATF, DEA and USMS to participate in the first part of the executive training under the new curricula.  Over the coming months, training will begin with executive personnel, followed by supervisors and managers, and later line personnel, including agents and attorneys.   

Attorney General Loretta E. Lynch released the following statement today on the U.S. Supreme Court ruling in Whole Woman’s Health v. Hellerstedt:

"For many years, the Supreme Court has maintained that regulations with the purpose or effect of presenting a substantial obstacle to a woman seeking an abortion constitute an undue burden on women trying to exercise their reproductive freedom, and are contrary to principles enshrined in the Constitution.  I am pleased that the Supreme Court has reaffirmed this longstanding principle in its decision today.

"When we filed a brief in this case, the Department of Justice made clear that we believe laws like the one at issue here unfairly restrict women's rights, negatively impact women's health, and undermine the state's interest in protecting the safety and welfare of its people.  In the days ahead, the Department of Justice will continue fighting against laws like this one.  And we will continue to defend the constitutional rights of women across America - including the right to reproductive freedom."

Thomas Davanzo, of Estero, Florida, and Robert Fedyna, of Naples, Florida, pleaded guilty today for their participation in a multi-state scheme to defraud biodiesel buyers and U.S. taxpayers by fraudulently selling biodiesel credits and fraudulently claiming tax credits, announced Assistant Attorney General John C. Cruden of the Justice Department’s Environment and Natural Resources Division and U.S. Attorney A. Lee Bentley III of the Middle District of Florida.  

Davanzo and Fedyna operated several shell companies that were used to facilitate the scheme.  As part of the scheme, Davanzo and Fedyna operated entities that purported to purchase renewable fuel, on which credits had been claimed and which was ineligible for additional credits, produced by their co-conspirators at Gen-X Energy Group (Gen-X), headquartered in Pasco, Washington, and its subsidiary, Southern Resources and Commodities (SRC), located in Dublin, Georgia.  They then used a series of false transactions to transform the fuel back into feedstock needed for the production of renewable fuel, and sold it back to Gen-X or SRC, allowing credits to be claimed again.  This cycle was repeated multiple times.

In addition, both Davanzo and Fedyna laundered the proceeds of the scheme through various shell entities.  Davanzo and Fedyna established bank accounts in the names of shell entities.  Funds were cycled through these shell companies’ bank accounts to perpetuate the fraud scheme and conceal its proceeds.

Davanzo and Fedyna also directed and participated in the generation of false paperwork designed to create the façade that the renewable identification number (or RIN, a serial number used to track biodiesel credits) created and claimed by co-conspirators were legitimate.  The paperwork included false invoices from Gen-X or SRC to shell entities, which purported to show sales of renewable fuel, false invoices from shell entities to Gen-X and SRC, which purported to show the purchase of feedstock and false bills of lading, which purported to show the transportation of fuel and feedstock by tanker truck.

From March 2013 to March 2014, the co-conspirators generated at least 60 million RINs that were based on fuel that was either never produced or was merely re-processed at the Gen-X or SRC facilities.  The co-conspirators received at least $42 million from the sale of these fraudulent RINs to third parties.  In addition, Gen-X received approximately $4,360,724.50 in false tax credits for this fuel.

This case was investigated by the U.S. Secret Service, the Environmental Protection Agency -Criminal Investigation Division, and the Internal Revenue Service-Criminal Investigation. It was prosecuted by Assistant United States Attorneys Sara C. Sweeney and Megan Kistler and Trial Attorney Adam Cullman of the Environment and Natural Resources Division of the Department of Justice.

INTERPOL Washington has been highlighted in a U.S. Immigration and Customs Enforcement (ICE) press release for providing investigative support with identifying the targets in Operation Project Red II. Forty-five of the fugitives have been arrested by the U.S. Marshals and ICE’s Enforcement and Removal Operations . The fugitives with Interpol Red Notices  were wanted for crimes in 22 different countries for various crimes. Please view the entire press release at the link provided below.

 

ICE PRESS RELEASE

 

 

 

The Department of Justice and the U.S. Environmental Protection Agency (EPA) today announced that D. G. Yuengling and Son Inc., has settled Clean Water Act violations involving its two large-scale breweries near Pottsville, Pennsylvania.

In a consent decree filed today in federal court in Harrisburg, Pennsylvania, the company has agreed to spend approximately $7 million to improve environmental measures at its brewery operations after it allegedly discharged pollutants into the Greater Pottsville Area Sewer Authority municipal wastewater treatment plant.  Yuengling will also pay a $2.8 million penalty.

In addition, the consent decree includes a requirement to implement an environmental management system (EMS) focused on achieving CWA compliance at the facilities. Yuengling must hire a third party consultant to develop the EMS and a third party auditor to ensure proper implementation at the facility operations.

The company allegedly violated Clean Water Act requirements for companies that discharge industrial waste to municipal publically-owned wastewater treatment facilities numerous times between 2008 and 2015.  Companies must obtain and comply with permit limits on discharges of industrial waste that goes to public treatment facilities, which in many cases require “pretreatment” of waste before it is discharged.  The case was referred to EPA by the Greater Pottsville Area Sewer Authority (GPASA).

“It is vital that companies using municipal wastewater treatment facilities strictly follow pretreatment guidelines and permit limits for their wastewater.  It is what good neighbors expect, and it is what the law requires,” said Assistant Attorney General John C. Cruden for the Department of Justice’s Environment and Natural Resources Division.  “This settlement  requires Yuengling to put into place an environmental management system designed to manage compliance with the Clean Water Act in a systemic, planned, and documented manner to establish a top-down, prevention-focused approach. The settlement also mandates independent audits of Yuengling’s compliance with the consent decree, among other requirements.”

“Yuengling is responsible for serious violations of its Clean Water Act pretreatment discharge limits, posing a potential risk to the Schuylkill River which provides drinking water to 1.5 million people,” said EPA Regional Administrator Shawn M. Garvin.  “This history of violations and failure to fully respond to orders from the Greater Pottsville Area Sewer Authority and EPA to correct the problems resulted in this enforcement action.”

In a complaint filed concurrently with the settlement, the United States alleged that Yuengling violated pretreatment permit requirements, including discharge limits for biological oxygen demand (BOD), phosphorus, zinc and pH to the GPASA treatment plant, at least 141 times from 2008 to 2015.

Pretreatment helps remove or change the composition of pollutants in wastewater.  Unpermitted or excessive industrial discharges may interfere with the operation of public wastewater treatment plants, which are generally designed to handle sewage and domestic waste, leading to the discharge of untreated or inadequately treated wastewater into local waters.

In addition to the monetary penalty, Yuengling has also agreed to take measures that will prevent future violations including:

• Designing and implementing an environmental management system for both breweries to ensure compliance with environmental laws;
• Conducting a series of environmental audits and inspections to ensure ongoing environmental compliance;
• Constructing a comprehensive pretreatment system at the Old Brewery;
• Optimizing and improving operation and maintenance of the pretreatment system at the New Brewery;
• Developing and implementing a communication and notification plan to quickly notify GPASA of any changes to the brewery facilites’ wastewater that may impact the public treatment facility;
• Hiring two certified wastewater treatment operators; and implementing a process to identify, investigate and respond to any future CWA violations quickly and efficiently.

The consent decree, which is subject to a 30-day public comment period and final court approval, is available at: www.justice.gov/enrd/

More information on the settlement: www.epa.gov/compliance/resources/cases/civil/cwa/arch.html

The Justice Department reached an agreement today with Powerstaffing Inc., a temporary staffing agency based in Edison, New Jersey.  The agreement resolves allegations that Powerstaffing’s North Bergen, New Jersey, office discriminated against work-authorized non-U.S. citizens in violation of the Immigration and Nationality Act (INA).

The department’s investigation found that from June 20, 2014, until at least Dec. 15, 2015, Powerstaffing had a pattern or practice of requesting specific immigration documents from non-U.S. citizens for the Form I-9 and E-Verify processes.  In contrast, Powerstaffing allowed U.S. citizens to present whichever valid documents they wanted to present to prove their work authorization.  Under the INA, all workers, including non-U.S. citizens, must be allowed to choose whichever valid documentation they would like to present from the lists of acceptable documents to prove their work authorization, such as a driver’s license and unrestricted social security card.  It is unlawful for an employer to limit employees’ choice of documentation because of their citizenship or immigration status.

Upon learning of the department’s investigation, Powerstaffing promptly re-trained its staff on proper Form I-9 and E-Verify practices.  Among other things, the settlement agreement requires Powerstaffing to pay $153,000 in civil penalties, be subject to department monitoring and review its hiring policies.

“All employers should ensure that when creating Form I-9 and E-Verify compliance plans, they fully understand the relevant rules so that they don’t discriminate against workers based on their citizenship status, immigration status or national origin,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division.  “The department applauds Powerstaffing for its prompt action to address and resolve this issue.” 

The Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) is responsible for enforcing the anti-discrimination provision of the INA.  The law prohibits, among other things, citizenship, immigration status and national origin discrimination in hiring, firing or recruitment or referral for a fee; unfair documentary practices in employment eligibility verification; retaliation and intimidation.  This matter was handled by Senior Trial Attorney Liza Zamd of OSC.

To learn more about the protections against employment discrimination under immigration laws, call OSC’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call OSC’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar at www.justice.gov/crt/about/osc/webinars.php; email osccrt@usdoj.gov or visit OSC’s website at www.justice.gov/crt/about/osc.

Applicants or employees who believe they have been subjected to: 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 should contact OSC’s worker hotline for assistance.

Powerstaffing Settlement Agreement

A woman originally from Lackawanna County, Pennsylvania, entered guilty pleas today in U.S. District Court in Philadelphia to all 23 counts of an indictment related to an odometer tampering conspiracy, the Department of Justice announced. 

Judith Ann Aloe, 55, previously residing in Lauderdale Lakes, Florida, was scheduled to stand trial in May 2014, in U.S. District Court in Philadelphia.  When she failed to appear for trial on May 14, 2014, a bench warrant was issued for her arrest by Chief Judge Petrese B. Tucker.  Aloe remained at large for 21 months.  In February 2016, she was located in Baja California, Mexico, and turned over to the U.S. Marshals Service at the Mexico/California border.  Today, she pleaded guilty to conspiracy to tamper with odometers, make false odometer certifications, and commit securities fraud and to 11 counts each of securities fraud and making false odometer certifications. Her sentencing is on Sept. 29 at 10 a.m. before Chief Judge Tucker.  

In April 2014, Aloe’s co-defendant, Kyle Novitsky, then 46, of Scott Township, Pennsylvania, pleaded guilty to several counts in the indictment. In October 2014, Novitsky was sentenced to 60 months in prison and ordered to pay restitution in the amount of $1,482,000 to victims.  From at least as early as 2004 through 2010, Aloe and Novitsky purchased high mileage cars and trucks, and then rolled back the odometers on the vehicles to make them appear more valuable.  Doing business under various company names, Aloe and Novitsky sold close to 250 vehicles with rolled back odometers.

“The purchase of an automobile is one of the biggest purchases consumers make, and consumers rely on accurate mileage information to assess the value and safety of a vehicle,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “Not only do purchasers pay more for used cars, but odometer fraud could ultimately affect a car’s safety and the costs of future repairs to the consumer.  The Department of Justice will continue to vigorously enforce consumer protection laws by bringing those who commit this crime to justice.” 

Aloe admitted to participating in the purchase of high-mileage cars, sport-utility vehicles and trucks from various locations of a national car rental company.  She then worked with Novitsky to roll back and alter the odometers and resold the vehicles at wholesale automobile auctions in Pennsylvania.  Aloe also caused to be altered the high mileages shown on the titles received from the car rental company to reflect false, low mileages and retitled the vehicles in Pennsylvania with false mileages.  These titles were then given to the buyers so that the mileage on the titles matched the mileage shown on a vehicle’s odometer.

This case was prosecuted by Senior Litigation Counsel Linda I. Marks of the Civil Division’s Consumer Protection Branch and former Consumer Protection Branch Trial Attorney Jessica Gunder, now an Assistant U.S. Attorney in Idaho, with assistance from the U.S. Attorney’s Office in the Eastern District of Pennsylvania.  The case was investigated by the National Highway Traffic Safety Administration’s (NHTSA) Office of Odometer Fraud Investigation. 

More information on odometer fraud is available on the NHTSA’s website and tips on detecting and avoiding odometer fraud are available at this page.  For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch.

Attorney General Loretta E. Lynch released the following statement today on the U.S. Supreme Court ruling in Fisher v. University of Texas at Austin:

“I am pleased that the Supreme Court has recognized our compelling interest in ensuring diversity in higher education.

“Diverse student enrollment is a vital part of America’s educational experience.  It creates a positive forum for scholarship and discovery, offering the opportunity for young people to learn from, interact with, and work alongside individuals of different backgrounds.  It promotes a stronger workforce, allowing employers and businesses to harness the wide range of experience and expertise they need to compete and win in today’s global economy.  And it aligns with the most cherished values of our country: opportunity, inclusion, and the notion that out of many disparate backgrounds, we are joined together as one united community.  Our country is stronger, more credible, and more effective when our educational institutions include highly-qualified individuals with roots, cultures, and traditions that reflect our nation’s rich diversity.  Going forward, the Department of Justice will continue to stand up for these principles, and to work with colleges and universities to promote diversity in a way that is consistent with the law.”

 

Over the course of three days, INTERPOL Washington collaborated with Immigration and Customs Enforcement (ICE) and the United States Marshals Service (USMS) in a multi-agency enforcement operation, known as Operation: Project Red II. The goal of the operation was to identify, locate, arrest, and remove criminal fugitive aliens in the United States.

The second iteration of the three-day sweep, which first took place in 2015, targeted aliens who are 1) currently at-large, 2) removable under U.S. immigration law, and 3) wanted for criminal prosecution or convicted of a criminal offense abroad. The USNCB and USMS supported ICE Enforcement and Removal Operations (ERO) agents to remove these fugitives, many of whom were subjects of INTERPOL Red Notices, which act as provisional international arrest warrants in many countries.

For its role, the USNCB collected, organized, and disseminated the INTERPOL information crucial for ICE to identify the operation’s targets, which allowed the agents and deputies to locate criminals they otherwise might never have known existed.

A 30-year-old woman pleaded guilty for her role in a Jamaica-based lottery fraud scheme, the Department of Justice announced today. 

Vania Lee Allen pleaded guilty in the Southern District of Georgia to one count of conspiracy to commit wire fraud and false impersonation of an employee of the United States.  Allen faces a maximum statutory sentence of five years in prison. A sentencing date has not been scheduled.  

“Lottery fraud schemes operating from Jamaica targeting Americans typically get help from at least one co-conspirator in the United States,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “Impersonating an FBI agent is just one way fraudsters convince innocent victims that the international lottery is legitimate.  It isn’t.  The Justice Department will actively pursue and charge those who participate in such criminal activity.”

As part of her guilty plea, Allen acknowledged that she and a co-conspirator in Jamaica sought to unlawfully enrich themselves through a fraudulent lottery scheme targeting an elderly resident of Evans, Georgia. 

An indictment charging Allen was filed on March 3.  As alleged in the indictment, Allen’s co-conspirator falsely informed the victim that he had won money in a lottery and instructed the victim to make payments to various people in order to collect the purported lottery winnings.  As part of her plea agreement, Allen acknowledged in order to induce the victim to continue to make payments as directed by her co-conspirator, Allen traveled from Jamaica to the United States to meet with the victim personally and falsely portrayed herself to the victim as an FBI agent.  Allen also acknowledged that when she met the victim, she falsely portrayed herself as a FBI agent, provided the victim with a cell phone, and directed him to speak with the person on the line, who was Allen’s co-conspirator in Jamaica.

“This conviction shows the extraordinary lengths fraudsters will use to rip off someone in the United States,” said U.S. Attorney Edward J. Tarver of the Southern District of Georgia.  “Such schemes will not be tolerated, and we will prosecute fraudsters whether they operate from inside or outside of the United States.” 

“The Postal Inspection Service is dedicated to investigating and combating international lottery schemes, especially since they prey on elderly Americans,” said Inspector in Charge David W. Bosch of the U.S. Postal Inspection Service’s Philadelphia, Pennsylvania Division. “The Postal Inspection Service is committed to uncovering and pursuing individuals involved in international lottery fraud schemes targeted at victims in the United States.” 

This prosecution is part of the Department of Justice’s effort to work with federal and local law enforcement to combat fraudulent lottery schemes in Jamaica that prey on U.S. citizens.  According to the U.S. Postal Inspection Service, Americans have lost tens of millions of dollars to fraudulent foreign lotteries.

The case was prosecuted by Trial Attorney Clint Narver of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney C. Troy Clark of the Southern District of Georgia.  The case was investigated by the U.S. Postal Inspection Service and the Columbia County Georgia Sherriff’s Office.

For more information about the Consumer Protection Branch, visit its website at http://www.justice.gov/civil/consumer-protection-branch.  For more information about the U.S. Attorney’s Office for the Southern District of Georgia, visit its website at http://www.justice.gov/usao-sdga.

Joseph Chait, 38, of Beverly Hills, California, the senior auction administrator of I.M. Chait Gallery, located in Beverly Hills, was sentenced today to one year and one day in prison and a $10,000 fine for conspiring to smuggle wildlife products made from rhinoceros horn, elephant ivory and coral with a market value of at least $1 million, announced Assistant Attorney General John C. Cruden for the Department of Justice’s Environment and Natural Resources Division, U.S. Attorney Preet Bharara for the Southern District of New York and Director Dan Ashe for the U.S. Fish and Wildlife Service (FWS).  On March 9, Chait pleaded guilty to a two-count Information before U.S. District Judge J. Paul Oetken for the Southern District of New York, who imposed today’s sentence.

“Conspiring in the trafficking endangered wildlife is a serious crime, and those involved in the auction industry should take note that facilitating this trade can result in prison,” said Assistant Attorney General Cruden.  “The African Elephant, the rhinoceros, and coral are all deeply threatened species that have undergone dramatic losses in recent decades as the trade in them has become highly lucrative.  We must stop this trade, and we will vigorously investigate and prosecute those engaged in it.”  

“By illegally trafficking in wildlife, including rhinoceros horns, Joseph Chait and his co-conspirators have fueled the illegal trade in endangered wildlife,” said U.S. Attorney Bharara.  “Chait’s conduct, a federal crime for which he will now spend time in prison, threatened the already precarious existence of certain endangered species of animals.”

“As this investigation by U.S. Fish and Wildlife Service Special Agents demonstrates, United States citizens and businesses continue to be involved in international wildlife trafficking – facilitating and magnifying consumer demand for rhino horn, elephant ivory and other illegal products that is driving the slaughter of imperiled species in the wild,” said Director Ashe.  “The stiff sentence and fines imposed today on Joseph Chait for his crimes serves notice to those engaged in similar criminal activity that their day of reckoning in court is coming.”

According to allegations contained in the Information and statements made in court filings and proceedings:  

Chait and his co-conspirators engaged in illegal trafficking of wildlife with a market value of at least $1 million.  Chait personally falsified customs forms by stating that rhinoceros horn and elephant ivory items were made of bone, wood or plastic.  For example, during Asia Week in New York City, New York, in or about March 2011, Chait was approached by an undercover special agent with FWS about the potential sale of a carving of Guanyin, an East Asian spiritual figure made from rhinoceros horn (the Rhino Carving).  Despite knowing that it was not a genuine antique, Chait and his co-conspirators accepted the Rhino Carving for consignment, advertised the sale to foreign clients in China and put the Rhino Carving on the cover of I.M. Chait Gallery’s catalogue in connection with an auction of Asian art and antiques.  After the Rhino Carving sold at auction for $230,000 to another undercover agent, Chait offered to make a false document for the buyer to help the buyer smuggle the item out of the country.  The fake invoice falsely stated that the item cost $108.75 and was made of plastic.

Chait also sold rhinoceros ivory carvings to another customer and provided those carvings to that customer’s courier, even after learning that the customer had been arrested in China for smuggling ivory purchased from Chait’s auction house.

In addition to falsifying customs forms by stating that rhinoceros horn and elephant ivory items were made of bone, wood or plastic, Chait and his co-conspirators conducted their wildlife smuggling using a variety of methods:

• Wildlife items were shipped to or picked up by third party shippers, who then re-shipped the items out of the country without the required declaration or permits. 
• Members of the conspiracy provided packing materials to foreign wildlife buyers to assist them in hand carrying the wildlife out of the country.
• Foreign wildlife buyers were sold protected wildlife items without being assessed a state sales tax if they showed a foreign passport and itinerary for an international flight as proof the item would be leaving the country.
• Protected wildlife was smuggled into the United States without declaration or permits and then sold at auction by members of the conspiracy.

As a result of a recent Presidential Executive Order, trade in protected wildlife such as rhinoceros horn and elephant ivory has been significantly restricted in the last two years, except for those instances where sellers can prove that the item is a genuine antique that is more than 100 years old.

Rhinoceros are an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth.  They have no known predators other than humans.  All species of rhinoceros are protected under U.S. and international law.  Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), a treaty signed by over 170 countries around the world to protect fish, wildlife and plants that are or may become imperiled due to the demands of international markets.

*                      *                      *

In addition to the term of prison, Chait was sentenced to three years of supervised release and was ordered to pay a $10,000 fine.

Assistant Attorney General Cruden and U.S. Attorney Bharara praised the efforts of FWS for its outstanding work in this investigation. 

This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit and the Environmental Crimes Section of the Department of Justice.  Assistant U.S. Attorneys Jennifer Gachiri and Elizabeth Hanft and Senior Litigation Counsel Richard A. Udell with the Environmental Crimes Section of the Department of Justice are in charge of the prosecution.

Most Defendants Charged and Largest Alleged Loss Amount in Strike Force History

Attorney General Loretta E. Lynch and Department of Health and Human Services (HHS) Secretary Sylvia Mathews Burwell announced today an unprecedented nationwide sweep led by the Medicare Fraud Strike Force in 36 federal districts, resulting in criminal and civil charges against 301 individuals, including 61 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings.  Twenty-three state Medicaid Fraud Control Units also participated in today’s arrests.  In addition, the HHS Centers for Medicare & Medicaid Services (CMS) is suspending payment to a number of providers using its suspension authority provided in the Affordable Care Act.  This coordinated takedown is the largest in history, both in terms of the number of defendants charged and loss amount.  

Attorney General Lynch and Secretary Burwell were joined in the announcement by Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, FBI Associate Deputy Director David Bowdich, Inspector General Daniel Levinson of the HHS Office of Inspector General (OIG), Acting Director Dermot O’Reilly of the Defense Criminal Investigative Service (DCIS), and Deputy Administrator and Director of CMS Center for Program Integrity Shantanu Agrawal M.D.

The defendants announced today are charged with various health care fraud-related crimes, including conspiracy to commit health care fraud, violations of the anti-kickback statutes, money laundering and aggravated identity theft.  The charges are based on a variety of alleged fraud schemes involving various medical treatments and services, including home health care, psychotherapy, physical and occupational therapy, durable medical equipment (DME) and prescription drugs.  More than 60 of the defendants arrested are charged with fraud related to the Medicare prescription drug benefit program known as Part D, which is the fastest-growing component of the Medicare program overall.

“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – It is a serious crime,” said Attorney General Lynch.  “The wrongdoers that we pursue in these operations seek to use public funds for private enrichment.  They target real people – many of them in need of significant medical care.  They promise effective cures and therapies, but they provide none.  Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends.  The Department of Justice is determined to continue working to ensure that the American people know that their health care system works for them – and them alone.”

“Millions of seniors depend on Medicare for essential health coverage, and our action shows that this administration remains committed to cracking down on individuals who try to defraud the program,” said Secretary Burwell.  “We are continuing to put new tools and additional resources to work, including $350 million from the Affordable Care Act, for health care fraud prevention and enforcement efforts.  Thanks to the hard work of the Medicare Fraud Strike Force, we are making progress in addressing and deterring fraud and delivering results to help ensure Medicare remains strong for years to come.”

According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare and Medicaid for treatments that were medically unnecessary and often never provided.  In many cases, patient recruiters, Medicare beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed.  Collectively, the doctors, nurses, licensed medical professionals, health care company owners and others charged are accused of submitting a total of approximately $900 million in fraudulent billing.

“The Medicare Fraud Strike Force is a model of 21st-Century data-driven law enforcement, and it has had a remarkable impact on health care fraud across the country,” said Assistant Attorney General Caldwell.  “As the cases announced today demonstrate, the Strike Force’s strategic approach keeps us a step ahead of emerging fraud trends, including drug diversion, and fraud involving compounded medications and hospice care.”

“These criminals target the most vulnerable in our society by taking money away from the care of the elderly, children and disabled,” said Associate Deputy Director Bowdich.  “The FBI is committed to working with our partners and the public to stop fraud and ensure that healthcare dollars are used to help the sick, and not line the pockets of criminals.”

“While it is impossible to accurately pinpoint the true cost of fraud in federal health care programs, fraud is a significant threat to the programs’ stability and endangers access to health care services for millions of Americans,” said Inspector General Levinson.  “As members of the joint Strike Force, OIG will continue to play a vital role in tracking down these criminals and seeing that justice is done.”

“DCIS, in partnership with our fellow federal investigative agencies, will continue to uncompromisingly investigate and bring to justice the people who perpetrate these criminal acts,” said Acting Director O’Reilly. “Their actions threaten to cripple our vital national health care industry, and place our citizenry at risk.  We will remain vigilant.”

“Taxpayers and Congress provided CMS with resources to adopt powerful monitoring systems that fight fraud, safeguard program dollars, and protect Medicare and Medicaid,” said Deputy Administrator and Center for Program Integrity Director Agrawal.  “The diligent use of innovative data analytic systems has contributed or led directly to many of the law enforcement cases presented here today.  CMS is committed to its collaboration with these agencies to keep federally-funded health care programs safe and strong for all Americans.”

The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  The Medicare Fraud Strike Force operates in nine locations and since its inception in March 2007 has charged over 2,900 defendants who collectively have falsely billed the Medicare program for over $8.9 billion. 

Including today’s enforcement actions, nearly 1,200 individuals have been charged in national takedown operations, which have involved more than $3.4 billion in fraudulent billings.  Today’s announcement marks the second time that districts outside of Strike Force locations participated in a national takedown, and they accounted for 82 defendants charged in this takedown.

*********

For the Strike Force locations, in the Southern District of Florida, a total of 100 defendants were charged with offenses relating to their participation in various fraud schemes involving approximately $220 million in false billings for home health care, mental health services and pharmacy fraud.  In one case, nine defendants have been charged with operating six different Miami-area home health companies for the purpose of submitting false and fraudulent claims to Medicare, including for services that were not medically necessary and that were based on bribes and kickbacks.  In total, Medicare paid the six companies over $24 million as a result of the scheme.

In the Southern District of Texas, 24 individuals were charged in cases involving over $146 million in alleged fraud.  One of these defendants is a physician with the highest number of referrals for home health services in the Southern District of Texas.  This physician has been charged with participating in separate schemes to bill Medicare for medically unnecessary home health services that were often not provided.  Numerous companies that submitted claims to Medicare using the fraudulent home health referrals from the physician were paid over $38 million by Medicare.

In the Northern District of Texas, 11 people were charged in cases involving over $47 million in alleged fraud.  In one scheme, a physician allowed unlicensed individuals to perform physician services and then billed Medicare as if he performed them.  Additionally, the physician certified patients for home health care that was often medically unnecessary.  Home health companies submitted approximately $23.3 million in billings to Medicare based on the physician’s fraudulent certifications.    

In the Central District of California, 22 defendants were charged for their roles in schemes to defraud Medicare of approximately $162 million.  In one case, a doctor was charged with causing almost $12 million in losses to Medicare through his own fraudulent billing, including performing medically unnecessary vein ablation procedures on Medicare beneficiaries.  

In the Eastern District of Michigan, 19 defendants face charges for their alleged roles in fraud, kickback, money laundering and drug distribution schemes involving approximately $114 million in false claims for services that were medically unnecessary or never rendered.  Among these are owners of a physical therapy clinic who lured patients through the payment of cash kickbacks and medically unnecessary prescriptions for Schedule II medications for the purpose of stealing more than $36 million from Medicare.   

In Tampa, Orlando and elsewhere in the Middle District of Florida, 15 individuals were charged with participating in a variety of schemes including compounding pharmacy fraud and intravenous prescription drug fraud involving $17 million in fraudulent billing.  In one case, the owner of several infusion clinics allegedly defrauded the Medicare program of over $8 million through a scheme involving reimbursement claims for expensive intravenous prescription drugs that were never purchased and never administered to patients.

In the Northern District of Illinois, six individuals were charged in cases related to three different schemes involving bribery and false and fraudulent claims for home health services and disability benefits.  The charged defendants include individuals who owned or co-owned the fraudulent providers and a medical doctor.  In total, these schemes resulted in over $12 million being paid to the defendants and their companies. 

In the Eastern District of New York, 10 individuals were charged in six different cases, including five individuals who were charged for their roles in a scheme involving over $86 million in physical and occupational therapy claims to Medicare and Medicaid.  In that case, the defendants are alleged to have filled a network of Brooklyn clinics that they controlled with patients by paying bribes and kickbacks.  Once at the clinics, these patients were subjected to medically unnecessary therapy.  The defendants then laundered the proceeds of the fraud through over a dozen shell companies. 

In the Eastern District of Louisiana, three defendants were charged in connection with a health care fraud and wire fraud conspiracy involving a defunct home health care provider.  This scheme centered on the payment of kickbacks through patient recruiters in exchange for patients who oftentimes never received nor qualified for home health care as billed.  Once admitted, patient medical records were routinely fabricated and altered to support false and fraudulent claims to Medicare.

*********

In addition to the Strike Force, today’s enforcement actions include cases brought by 26 U.S. Attorney’s Offices, including the unsealing of search warrants in investigations being conducted by the Eastern District of North Carolina, Southern District of Georgia, District of Columbia, Eastern District of Texas, Southern District of West Virginia, Middle District of Louisiana, District of Minnesota, and the Northern District of Alabama.

In the Northern District of Georgia, nine defendants were charged for their roles in two health care fraud schemes involving $7 million in fraudulent billings.  Eight defendants were charged in a scheme where bribes and kickbacks were allegedly paid to a state of Georgia official in exchange for falsifying applications and licensing requirements and recommending the approval of unqualified mental health providers.

In the Middle District of Alabama, two defendants were charged for their roles in a mental health services scheme allegedly involving $246,000 in fraudulent billings.

In the Middle District of Tennessee, a doctor was charged for his role in an illegal kickback scheme under which he allegedly referred patients to a certain DME supplier in exchange for cash kickbacks.

In the Western District of Kentucky, a business entity was charged for its role in a health care fraud scheme.

In the Southern District of Ohio, two defendants were charged for their roles in a $7.5 million home healthcare fraud scheme.

In the Western and Eastern Districts of Pennsylvania, three defendants were charged for their roles in drug diversion and embezzlement schemes.

In the Southern District of New York, a pharmacist was charged for his role in a scheme involving over $51 million in fraudulent Medicare and Medicaid billings. 

In the Districts of Maine, Alaska, Kansas, Connecticut and Vermont, five defendants were charged for their roles in Medicaid-related schemes.

In the Eastern District of Missouri, four defendants, including a doctor and pharmacist, were charged for their roles in schemes involving over $3 million in billings.

In the Southern District of California, eight individuals were charged in health care-related cases.  In one case, five individuals, including a doctor and a pharmacist, were charged in a scheme to pay bribes and kickbacks to doctors in exchange for prescribing expensive durable medical equipment and compound pain creams that were not medically necessary.  The indictment alleges that approximately $27 million in false and fraudulent claims were submitted to insurers.

In the District of New Mexico, two defendants were charged for their roles in a Medicaid fraud scheme.

In the Northern District of Iowa, a settlement agreement was reached with a corporate entity for its role in a health care fraud scheme in a juvenile residential treatment facility.

In the District of Oregon, one defendant was charged for his role in a $1.7 million optometry services scheme.

In the District of Puerto Rico, civil demand letters were issued to six individuals for their roles in a scheme to defraud the Medicaid program.

In addition, in the states of Florida, Iowa, South Dakota, Indiana, New York, Michigan, Oklahoma, Rhode Island, Louisiana, Pennsylvania, New Hampshire, Oregon, Kentucky and Alaska, 49 defendants have been charged in criminal and civil actions with defrauding the Medicaid program and 57 sites were searched, pursuant to search warrants.  These cases were investigated by each state’s respective Medicaid Fraud Control Units. 

The cases announced today are being prosecuted and investigated by U.S. Attorneys’ Offices nationwide, along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois and the Middle District of Florida; and agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.

A complaint or indictment is merely a charge, and all defendants are presumed innocent unless and until proven guilty.

The court documents for each case will posted online, as they become available, here: https://www.justice.gov/opa/documents-and-resources-june-22-2016-medicare-fraud-strike-force-press-conference.

The Affordable Care Act has provided new tools and resources to fight fraud in federal health care programs.  The law provides an additional $350 million for health care fraud prevention and enforcement efforts, which has allowed the department to hire more prosecutors and the Strike Force to expand from two cities to nine.  The act also toughens sentencing for criminal activity, enhances provider and supplier screenings and enrollment requirements and encourages increased sharing of data across government.

In addition to providing new tools and resources to fight fraud, the Affordable Care Act clarified that for sentencing purposes, the loss is determined by the amount billed to Medicare and increased the sentencing guidelines for the billed amounts, which has provided a strong deterrent effect due to increased prison time, particularly in the most egregious cases.

Since January 2009, the Justice Department’s Civil Division, along with U.S. Attorney’s Offices around the country, has recovered a total of more than $29.9 billion through False Claims Act cases, with more than $18.3 billion of that amount recovered in cases involving fraud against federal health care programs.

The Justice Department reached an agreement today with Macy’s over allegations that the large national retailer violated the Immigration and Nationality Act (INA) by discriminating against work-authorized non-U.S. citizens at its Glendale, California, location.

The department’s investigation was based on a charge filed by a lawful permanent resident whose hiring was delayed in October 2015.  The charging party alleged, and the investigation found, that she was not able to begin working at Macy’s even though she showed sufficient proof of her work authorization because a Macy’s hiring official incorrectly believed that lawful permanent residents were required to produce unexpired permanent resident cards.  The investigation also found that other human resource employees in Macy’s Glendale location were imposing the same unnecessary requirement on four other lawful permanent residents.  In contrast, U.S. citizens were permitted to choose whichever valid documents they wanted to present to prove their work authorization.  Under the INA, lawful permanent residents do not have to show their permanent resident cards when they start working.  Instead, like all workers, they can choose whichever documentation the would like to present, such as a driver’s license and unrestricted social security card, from the lists of acceptable documents.

Under the settlement agreement, Macy’s will, among other things, provide additional training to its employees and assess its employees’ understanding of applicable rules.  Macy’s will also pay an $8,700 civil penalty and periodically produce Form I-9 information to the department for review.

“Macy’s did the right thing by immediately resolving the charging party’s delayed hiring and by giving her full back pay,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department's Civil Rights Division.  “All employers should take care not to impose unlawful burdens on employees because of their citizenship or immigration status and address issues promptly when they make mistakes.”

The Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) is responsible for enforcing the anti-discrimination provision of the INA.  The law prohibits, among other things, citizenship, immigration status and national origin discrimination in hiring, firing, recruitment or referral for a fee; unfair documentary practices in employment eligibility verification; retaliation and intimidation.

To learn more about the protections against employment discrimination under immigration laws, call OSC’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call OSC’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); sign up for a free webinar at www.justice.gov/crt/about/osc/webinars.php; email osccrt@usdoj.gov or visit OSC’s website at www.justice.gov/crt/about/osc.

Applicants or employees who believe they have been subjected to: 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, should contact OSC’s worker hotline for assistance.

Macy's Settlement Agreement

A Forest City, Iowa, businessman pleaded guilty today in federal court to failing to pay employment taxes, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Kevin W. Techau of the Northern District of Iowa.

Darrell Smith, 60, was charged in an indictment in January 2016 with multiple counts of willfully failing to collect, truthfully account for and pay federal employment taxes that were withheld from the wages of employees of Permeate Refining Inc., an ethanol-production business in Hopkinton, Iowa.

“Today’s plea reaffirms our commitment to prosecuting employers who willfully fail to comply with their employment tax obligations,” said Acting Assistant Attorney General Ciraolo.  “Working with our law enforcement partners in the Internal Revenue Service (IRS), the Department of Justice will continue to vigorously investigate and prosecute those who seek to cheat the U.S. Treasury and gain an unfair advantage over their competitors.”

“Mr. Smith’s attempt to dodge his legal obligation to account for and pay employment taxes did not go unchecked, and he will now be held accountable for his criminal conduct,” said U.S. Attorney Techau.

At his guilty plea hearing, Smith admitted that he collected and willfully failed to account for and pay over to the IRS $85,267 for the second quarter of 2012. A sentencing date has not yet been set.  Smith faces a statutory maximum sentence of five years in prison as well as a term of supervised release and monetary penalties. Smith’s co-defendant Randy Less pleaded guilty on June 14 to failing to pay employment taxes and violating the Clean Water Act.

Acting Assistant Attorney General Ciraolo and U.S. Attorney Techau thanked special agents of IRS-Criminal Investigation, the FBI, the U.S. Postal Inspection Service and the U.S. Environmental Protection Agency, who investigated the case and Assistant U.S. Attorney Tim Vavricek of the Northern District of Iowa and Trial Attorney Matthew Hoffman of the Tax Division, who are prosecuting the case.

Additional information about the Tax Division’s Employment Tax Enforcement efforts may be found here.

Defendant Used Stolen Identification Information to Access “Get Transcript” Database and File False Returns

An Austell, Georgia, resident was sentenced today to 15 months in prison for his role in laundering proceeds from a stolen identity refund fraud scheme, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney John A. Horn of the Northern District of Georgia. 

Rapheal Atebefia pleaded guilty to one count of money laundering on March 25. According to court documents, Atebefia and his co-conspirators obtained the means of identification of actual individuals, including their names and social security numbers, and used this information to access the Internal Revenue Service’s (IRS) “Get Transcript” database.  The stolen names and the information obtained from Get Transcript were used to file false income tax returns.  Atebefia’s co-conspirators obtained prepaid debit cards from stores located in multiple states and registered the cards in the names of the stolen identities.  These debit cards were used to receive the income tax refunds requested on the false tax returns.  To conceal this fraudulent scheme, the prepaid debit cards were then used to purchase money orders.  Atebefia deposited the money orders into his bank accounts and then structured cash withdrawals of the proceeds in order to prevent the bank from filing Currency Transaction Reports.

In addition to the prison term, Atebefia was ordered to serve three years of supervised release and to pay restitution in the amount of $52,621 to the IRS.  Atebefia’s co-defendants, Anthony and Sonia Alika, are scheduled to be sentenced on July 27. 

Acting Assistant Attorney General Ciraolo and U.S. Attorney Horn commended special agents of IRS-Criminal Investigation and the U.S. Postal Inspection Service, who investigated the case and Trial Attorneys Michael C. Boteler and Charles M. Edgar Jr. of the Tax Division and Assistant U.S. Attorney Brian Pearce, who are prosecuting this case.

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

A former Credit Suisse AG banker, who has been a fugitive since 2011, pleaded guilty today in U.S. District Court in the Eastern District of Virginia to charges related to aiding and assisting U.S. taxpayers in evading their income taxes, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Dana J. Boente of the Eastern District of Virginia.

Michele Bergantino, 48, a citizen of Italy and a resident of Switzerland, pleaded guilty before U.S. District Judge Gerald Bruce Lee to conspiring to defraud the United States by assisting U.S. taxpayers to conceal foreign accounts and evade U.S. tax during his employment as a banker working for Credit Suisse AG on its North American desk.

“Mr. Bergantino is now the third fugitive to come to the United States and plead guilty to charges in this case,” said Acting Assistant Attorney General Ciraolo. “To those who have actively assisted U.S. taxpayers in using offshore accounts to evade taxes, the message is clear:  staying outside the United States will provide little comfort.  We will investigate and charge you, and will work relentlessly to hold you to account for your actions.”

“Hiding assets and creating secret accounts in an attempt to evade income taxes is a losing game,” said U.S. Attorney Boente. “Today’s plea shows that we will continue to prosecute bankers and U.S. citizens who engage in this criminal activity. I want to thank our law enforcement partners and prosecutors for their work on this important case.”

Bergantino admitted that from 2002 to 2009, while working as a relationship manager for Credit Suisse in Switzerland, he participated in a wide-ranging conspiracy to aid and assist U.S. taxpayers in evading their income taxes by concealing assets and income in secret Swiss bank accounts.  Bergantino oversaw a portfolio of accounts, largely owned by U.S. taxpayers residing on the West Coast, which grew to approximately $700 million of assets under management.  Bergantino admitted that the tax loss associated with his criminal conduct was more than $1.5 million but less than or equal to $3.5 million.  

During his time as a relationship manager, Bergantino assisted many U.S. clients in utilizing their Credit Suisse accounts to evade their U.S. income taxes and to facilitate concealment of the U.S clients’ undeclared financial accounts from the U.S. Treasury Department and the Internal Revenue Service (IRS).  Among the steps taken by Bergantino to assist clients in hiding their Swiss accounts were the following:  assuring them that Swiss bank secrecy laws would prevent Credit Suisse from disclosing their undeclared accounts to U.S. law enforcement; discussing business with clients only when they traveled to Zurich to meet him; structuring withdrawals from their undeclared accounts by sending multiple checks, each in amounts below $10,000, to clients in the United States; facilitating the withdrawal of large sums of cash by U.S. customers from their Credit Suisse accounts at Credit Suisse offices in the Bahamas, in Switzerland, particularly the Credit Suisse branch at the Zurich airport and at a financial institution in the United Kingdom; holding clients’ mail from delivery to the United States; issuing withdrawal checks from Credit Suisse’s correspondent bank in the United States; and taking actions to remove evidence of a U.S. client’s control over an account because the U.S. client intended to file a false and fraudulent income tax return.  Moreover, Bergantino understood that a number of his U.S. clients concealed their ownership and control of foreign financial accounts by holding those accounts in the names of nominee tax haven entities, or structures, which were frequently created in the form of foreign partnerships, trusts, corporations or foundations. 

“Today’s plea of Michele Bergantino is another example of IRS-Criminal Investigation’s (CI) dedication to bringing individuals to justice who engage in helping U.S. taxpayers evade their tax obligations,” said IRS-CI Chief Richard Weber. “We will continue our global efforts to vigorously pursue both U.S. taxpayers who avoid paying their fair share and the unscrupulous professionals who facilitate their actions. For those hiding cash or assets offshore, the time to come clean is now.”

Bergantino also admitted traveling to the United States approximately one to two times a year to meet with clients, taking careful steps to conceal the purpose of his visits from U.S. law enforcement.  He used private couriers to send clients’ account statements to the U.S. hotels where he stayed, so that he would not be caught traveling with clients’ statements in his possession.  In addition, Bergantino obtained “travel” account statements for each client he intended to visit which were devoid of Credit Suisse’s logo and account or customer identification information and used business cards that Credit Suisse provided that contained only his name and office number and did not carry the Credit Suisse name or logo.  On entering the United States, Bergantino provided misleading information regarding the nature and purpose of his visit to U.S. Customs and Border Protection authorities.

In addition to assisting customers in evading their U.S. taxes, Bergantino also provided illegal advice to U.S. customers regarding investments in U.S. securities.  Neither Bergantino nor Credit Suisse were registered with the U.S. Securities and Exchange Commission and both U.S. law and Credit Suisse policy prohibited Bergantino and other Credit Suisse employees from providing investment advice in the United States.  Nevertheless, Credit Suisse management pressured its employees, including Bergantino, to make sales in the United States.

Two of Bergantino’s co-defendants, Andreas Bachmann and Josef Dörig, pleaded guilty to the superseding indictment in 2014 and were sentenced on March 27, 2015.  Credit Suisse pleaded guilty in May 2014 for conspiring to aid and assist taxpayers in filing false returns and was sentenced in November 2014 to pay $2.6 billion in fines and restitution.

Bergantino faces a statutory maximum sentence of five years in prison.  He also faces monetary penalties and restitution.

Acting Assistant Attorney General Ciraolo and U.S. Attorney Boente commended special agents of IRS-Criminal Investigation, who investigated the case and Senior Litigation Counsel Mark F. Daly and Trial Attorney Robert J. Boudreau of the Tax Division and Assistant U.S. Attorney Mark Lytle of the Eastern District of Virginia, who are prosecuting this case.

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

Thomas Harper, a former officer and owner of MCC Construction Company (MCC), pleaded guilty today to conspiring to obstruct justice before the Small Business Administration (SBA).  Harper also agreed to pay restitution in the amount of $165,711, the Department of Justice announced today.

The plea was announced by Principal Deputy Assistant Attorney General Renata Hesse of the Justice Department’s Antitrust Division; U.S. Attorney Channing D. Phillips of the U.S. Attorney’s Office for the District of Columbia; Assistant Director in Charge Paul M. Abbate of the FBI’s Washington Field Office; Inspector General Peggy E. Gustafson of the Small Business Administration (SBA); Inspector General Carol Fortine Ochoa of the U.S. General Services Administration (GSA); Special Agent in Charge Brian J. Reihms of the Central Field Office of the Defense Criminal Investigative Service (DCIS), and Director Frank Robey of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (MPFU).

“Today's guilty plea ensures that the defendant does not profit from his crimes,” said Principal Deputy Assistant Attorney General Hesse. “The Antitrust Division will continue to work with our colleagues at the US Attorney's Office and in law enforcement to expose and punish schemes like this that defraud taxpayers and legitimate small business owners.”

“This prosecution and the broader investigation that led to these charges demonstrate the resolve of law enforcement to protect the integrity of federal contracting rules meant to assist small, disadvantaged businesses,” said U.S. Attorney Phillips. “We are committed to ensuring that the benefits of this important government program go only to those companies that truly are socially and economically disadvantaged and deserving of the work.”

“The FBI will aggressively investigate those who seek to profit by fraudulently competing for government contracts intended for small businesses,” said Assistant Director in Charge Abbate.  “I want to thank the dedicated FBI special agents and analysts, as well as our partner agencies, for their hard work in protecting fair federal contracting opportunities for socially and economically disadvantaged businesses in our community.”

“Fraudulently passing work through eligible small businesses to a large business does not provide taxpayers the best value and certainly does not support the role of small businesses as engines of economic development and job creation,” said SBA Inspector General Gustafson.  “In fact, it subverts the purpose of SBA’s preferential contracting programs and harms the small businesses the programs are designed to assist.  I want to thank the U.S. Attorney’s Office and our law enforcement partners for their leadership and dedication to serving justice.”

“This fraudulent scheme deceived taxpayers and deprived legitimate small businesses of lucrative contracts,” said GSA Inspector General Ochoa. “We are committed to rooting out such exploitative conduct.”

“The Defense Criminal Investigative Service is committed to working with our partner agencies to combat fraud impacting the Department of Defense's vital programs and operations and maintain the integrity of the procurement system,” said Special Agent in Charge Reihms.

“There is an absolute need and purpose to assist small and disadvantaged businesses in the contracting process,” said Director Robey.  “Special Agents from Army CID will continue to work closely with our law enforcement partners to make every contribution possible to bring persons to justice who violate that purpose.”

Harper, 46, of Colchester, Connecticut, was charged in a criminal information on June 6, 2016, in the U.S. District Court for the District of Columbia, with one count of conspiring to obstruct proceedings before a department or agency.  He waived the requirement of being charged by way of federal indictment, agreed to the filing of the information, and accepted responsibility for his criminal conduct. The charge carries a statutory maximum of five years in prison and potential financial penalties. According to the government’s calculations, Harper could face a potential range of 10 to 16 months in prison under federal sentencing guidelines.  The Honorable Ketanji Brown Jackson scheduled a status hearing in the case for Sept. 20, 2016.

According to court documents, MCC and others conspired with two companies that were eligible to receive federal government contracts set asides for small, disadvantaged businesses with the understanding that MCC would, illegally, perform all of the work.  In so doing, MCC was able to win 27 government contracts worth over $70 million from 2008 to 2011.  The scope and duration of the scheme resulted in a significant number of opportunities lost to legitimate small and disadvantaged businesses.

Court documents state that in one of these contracts, the GSA contracting officer filed a protest with the SBA, claiming that one of the companies was other than a small business because of its relationship with MCC.  The SBA opened a proceeding to determine whether MCC’s bid on behalf of one of the companies violated SBA rules and regulations.  Harper and others took steps to corruptly influence, impede, and obstruct the SBA size determination protest by willfully and knowingly making false statements to the SBA about the extent and nature of the relationship between MCC and one of the companies.

Court documents also state that MCC violated the provisions of the SBA 8(a) program.  The SBA 8(a) development program is designed to award contracts to businesses that are owned by “one or more socially and economically disadvantaged individuals.”  To qualify for the 8(a) program, a business must be at least 51 percent owned and controlled by a U.S. citizen (or citizens) of good character who meet the SBA’s definition of socially and economically disadvantaged.  The firm must also be a small business (as defined by the SBA) and show a reasonable potential for success.  Participants in the 8(a) program are subject to regulatory and contractual limits.  Also, under the program, the disadvantaged business is required to perform a certain percentage of the work.  For the types of contracts under investigation here, the SBA 8(a)-certified companies were required to perform 15 percent or more of the work with its own employees.

Earlier this year, MCC pleaded guilty to conspiring to commit fraud on the United States by illegally obtaining government contracts that were intended for small, disadvantaged businesses and agreed to pay $1,769,924 in criminal penalties and forfeiture.

The investigation is being conducted by the FBI’s Washington Field Office, the Inspector General for the Small Business Administration (SBA), the Inspector General of the U.S. General Services Administration (GSA), the Central Field Office of the Defense Criminal Investigative Service (DCIS), and the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit (MPFU).

 The prosecution is being handled by Assistant U.S. Attorney Matt Graves and John Marston of the U.S. Attorney’s Office for the District of Columbia and Assistant Chief Craig Y. Lee and Trial Attorneys Kevin B. Hart and Justin P. Murphy of the Antitrust Division.

          ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that EILEEN JOANNE CRUZ QUITUGUA, age 31, was sentenced today by Chief Judge Frances Tydingco-Gatewood of the District Court of Guam to serve 30 months in federal prison, and five years of supervised release, and to pay $159,735.76 in restitution and a $400 special assessment fee.  Defendant QUITUGUA pled guilty on December 3, 2015, to four counts of bank fraud in violation of Title 18, United States Code, Section 1344.

          In her plea agreement, QUITUGUA admitted that from October 2011 to January 2014, she embezzled $159,735.76  from her employer Allied Pacific Environmental Consulting (APEC).  APEC hired her as its bookkeeper and she was responsible for preparing checks drawn on the company’s checking accounts maintained at First Hawaiian Bank.  QUITUGUA forged the signatures of the company owner and other authorized personnel on 221 company checks that totaled $159,735.76.  She wrote payroll checks for herself and checks ostensibly for petty cash, and used the stolen funds for her personal benefit.

          U.S. Attorney Limtiaco stated “The U.S. Attorney’s Office and its law enforcement partners are committed to investigating and prosecuting those who victimize and perpetrate fraud against members of our community, including businesses and financial institutions.”

          This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Marivic David.

A federal court in Tampa, Florida, has permanently barred a Bradenton, Florida, man from preparing federal tax returns for others, the Justice Department announced today.

In April, the United States filed a civil complaint against Guy Riston Paul, individually and doing business as G7 Financial Enterprises & More, G7 Accounting and Tax Services and Voltaire Multi-Services.  Paul, who is currently serving a three-year prison term for engaging in the preparation of false tax returns and for failing to report income he earned from his tax preparation business, consented to entry of the injunction, but he did not admit the allegations in the United States’ complaint. 

According to the civil complaint, Paul prepared federal income tax returns for customers that overstated his customers’ refunds by taking the identities of dependents from customers who were not U.S. citizens and claiming them on the tax returns of his U.S. citizen customers.  Paul used this scheme to claim improper Earned Income Tax Credits and Child Tax Credits, the complaint alleges.  Paul also allegedly claimed other false credits, such as the education tax credit, on his customers’ returns. 

Return preparer fraud is one of the Internal Revenue Service’s (IRS) Dirty Dozen Tax Scams for 2016.  The IRS has some tips on its website for choosing a tax preparer and has launched a free directory of federal tax preparers.  In the past decade, the Justice Department’s Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers and tax scheme promoters.  Information about these cases is available on the Justice Department’s website.  An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page.  If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.       

UBS AG has complied with an Internal Revenue Service (IRS) summons for bank records held in its Singapore office, the Justice Department announced today.  Because UBS has now produced all Singapore-based records responsive to the request and the IRS determined that UBS complied with the summons, the Justice Department has voluntarily dismissed its summons enforcement action against the bank.

The IRS served an administrative summons on UBS for records pertaining to accounts held by Ching-Ye “Henry” Hsiaw.  According to the petition, the IRS needed the records in order to determine Hsiaw’s federal income tax liabilities for the years 2006 through 2011.  Hsiaw transferred funds from a Switzerland-based account with UBS to the UBS Singapore branch in 2002, according to the declaration of a revenue agent filed at the same time as the petition.  UBS refused to produce the records, and the United States filed its petition to enforce the summons.

“The Department of Justice and the IRS are committed to making sure that offshore tax evasion is detected and dealt with appropriately,” said Acting Assistant Attorney General Caroline D. Ciraolo of the Tax Division.  “One critical component of that effort is making sure that the IRS has all of the information it needs to audit taxpayers with offshore assets.  In this case, we filed a petition to enforce a summons for offshore documents, but that’s only one of the tools we have available for gathering information.  Taxpayers with offshore assets who underreported their income should come forward before we come looking for them.”

The Tax Division aggressively pursues offshore tax evasion.  More information is available online about the Division’s Offshore Compliance Initiative and its Swiss Bank Program.  

The national grocery store chain Trader Joe’s Company has agreed to reduce emissions of potent greenhouse gases from refrigeration equipment at 453 of its stores under a proposed settlement with the U.S. Department of Justice and the Environmental Protection Agency (EPA) to resolve alleged violations of the Clean Air Act.  Under the settlement, Trader Joe’s will spend an estimated $2 million over the next three years to reduce coolant leaks from refrigerators and other equipment and improve company-wide compliance.  The company will also pay a $500,000 civil penalty.

The United States alleged that Trader Joe’s violated the Clean Air Act by failing to promptly repair leaks of R-22, a hydrochlorofluorocarbon (HCFC) that is an ozone-depleting substance and potent greenhouse gas used as a coolant in refrigerators. The company also failed to keep adequate servicing records of its refrigeration equipment and failed to provide information about its compliance record.

“By reducing the amount of ozone depleting refrigerants and potent greenhouse gasses released into the atmosphere, this settlement will assist our efforts to control these two major global environmental problems,” said Assistant Attorney General John C. Cruden of the Department of Justice’s Environment and Natural Resources Division.  “The consent decree will also help assure Trader Joe’s future compliance with the Clean Air Act, by requiring heightened auditing, leak monitoring, centralized computer recordkeeping, and searchable electronic reporting to EPA.”

Trader Joe’s will now implement a corporate refrigerant compliance management system to comply with federal stratospheric ozone regulations and to detect and repair leaks through a new quarterly leak monitoring program.  In addition, Trader Joe’s will achieve and maintain an annual corporate-wide average leak rate of 12.1 percent through 2019, well below the grocery store sector average of 25 percent.  The company must also use non-ozone depleting refrigerants at all new stores and major remodels and at least 15 of these stores must use advanced refrigerants, such as carbon dioxide which have significantly less global warming potential compared to typical refrigerants.

“Taking action to combat climate change is a priority for the Obama Administration and this settlement will result in substantial cuts to one of the most potent greenhouse gases,” said Cynthia Giles, Assistant Administrator for EPA’s Office of Enforcement and Compliance Assurance.  “The company-wide upgrades Trader Joe’s will make are not only good for the environment, they set a high bar for the grocery industry for detecting and fixing coolant leaks.”

“Some of the refrigerants now in use by Trader Joe’s are up to 4,700 times more potent than carbon dioxide,” said Acting Regional Administrator Alexis Strauss for EPA’s Pacific Southwest.  “Today’s settlement will affect all of Trader Joe’s current and new stores to prevent the release of approximately 31,000 metric tons of carbon-equivalent greenhouse gases.” 

The total estimated greenhouse gas emissions reductions from this settlement are equal to the amount from over 6,500 passenger vehicles driven in one year, the CO2 emissions from 33 million pounds of coal burned, or the carbon sequestered by 25,000 acres of forests in one year.

EPA regulations issued under the Clean Air Act require that owners or operators of commercial refrigeration equipment that contain over 50 pounds of ozone-depleting refrigerants repair any leaks within 30 days.  Damage to the ozone layer results in dangerous amounts of cancer-causing ultraviolet solar radiation, increasing skin cancers and cataracts.  R-22 is also a potent greenhouse gas with 1,800 times more global warming potential than carbon dioxide.  Approximately one-quarter of Trader Joe’s equipment units use hydrofluorocarbon (HFC) refrigerants that are non-ozone-depleting, but have a high global warming potential.  An added benefit of repairing refrigerant leaks is improved energy efficiency of the system which can save electricity.

The settlement is the third in a series of national grocery store refrigerant cases, including cases previously filed against Safeway Inc. and Costco Wholesale Corp.  Today’s settlement also supports the goals of President Obama’s Climate Action Plan by reducing HFC emissions, as well as EPA’s proposal under Section 608 of the Clean Air Act that aims to update requirements and improve refrigerant management practices for refrigerants that are greenhouse gases, but not ozone-depleting, such as HFCs.  This is the first EPA settlement with requirements to repair leaks of HFCs in order to further reduce greenhouse gas emissions.

Trader Joe’s, headquartered in Monrovia, California, is a privately held chain of specialty grocery stores in the U.S., with 461 stores located in 43 states and Washington, D.C. and 2014 revenues of $9.38 billion.

The settlement was lodged today in the U.S. District Court for the Northern District of California and is subject to a 30-day public comment period and final court approval.  It will be available for viewing at https://www.justice.gov/enrd/consent-decrees.

For more information on the Presidents Climate Action Plan, please visit: https://www.whitehouse.gov/sites/default/files/image/president27sclimateactionplan.pdf

The Department of Justice announced today that two Alabama pharmacists have been sentenced to 12 and 10 months in prison for their roles in the distribution of adulterated drugs, which were compounded at the now-defunct compounding pharmacy Advanced Specialty Pharmacy doing business as Meds IV.

David Allen, 60, of McCalla, Alabama, was the former pharmacist-in-charge of Meds IV, and William Timothy Rogers, 48, of Hoover, Alabama, was the former president of Meds IV.  Both men pleaded guilty in March 2016 to two misdemeanor violations of the Federal Food, Drug and Cosmetic Act (FDCA).  Allen and Rogers were sentenced to 12 months and 10 months in prison, respectively, by U.S. District Court Judge Virginia Emerson Hopkins for the Northern District of Alabama. Judge Hopkins also sentenced both defendants to one year of supervised release following their imprisonment and a $5,000 fine.

“Compounding pharmacies are entrusted with protecting the public’s health from any harm their drugs may impose and must comply with the law,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “These cases demonstrate that the Department of Justice will continue to work aggressively with the U.S. Food and Drug Administration (FDA) to protect consumers from drugs compounded under insanitary conditions.”

“Meds IV provided intravenous nutrition to patients, without taking legally required precautions in the preparation of its product,” said U.S. Attorney Joyce White Vance for the Northern District of Alabama. “As a result, a number of patients developed serious infections.  We are committed to prosecuting this type of practice to the fullest extent of the law provides for and protecting the safety of our citizens.”

“Producing unsafe and contaminated drugs poses a serious threat to the U.S. public health and cannot be tolerated,” said Director George Karavetsos of the FDA’s Office of Criminal Investigations.  “The FDA remains fully committed to aggressively pursuing those who place unsuspecting American consumers at risk by distributing adulterated drugs.”

As alleged in the information, Meds IV compounded various drugs for human use, including an intravenous drug known as Total Parenteral Nutrition (TPN).  TPN is liquid nutrition administered intravenously to patients who cannot or should not receive their nutrition through eating.  The information alleged that beginning in or around February 2011, Meds IV compounded its own amino acid solution, which it then mixed with other ingredients to form TPN. 

As charged in the information, amino acid used in compounding the TPN was adulterated in that it was contaminated with Serratia marcescens (S. marcescens) and was prepared, packed, or held under insanitary conditions.  S. marcescens is a bacteria that can cause bloodstream infections if introduced into the bloodstream through contaminated medications.  These infections can cause serious medical complications, including death, because S. marcescens is resistant to many antibiotics.

According to the charging document, the amino acid was prepared by Meds IV outside a laminar airflow workbench and was kept unrefrigerated, in a room that was not sterile, in a large pot sitting on the floor, sometimes overnight, before it was sterilized and used. 

As alleged in the information, between March 5 and 15, 2011, nine patients at various Birmingham-area hospitals who developed bloodstream infections caused by S. marcescens died, and several other hospital patients developed S. marcescens bloodstream infections but survived.  According to the charges, all of these patients had been given TPN that was compounded and distributed by Meds IV.  As alleged in the information, while a number of the patients who died had underlying conditions which may have contributed to their deaths, medical records of some patients suggest that the S. marcescens bloodstream infections were also a significant factor.

According to the information, Meds IV was notified on March 14, 2011, by a hospital in the Birmingham area, that four patients receiving TPN had tested positive for S. marcescens.  The information alleged that the TPN was compounded and distributed by Meds IV and that this notification was the first time Meds IV was informed of a link between its TPN and patients testing positive for S. marcescens.  The information alleged that on or around March 16, 2011, Meds IV began notifying some customers that compounding of TPN was suspended until further notice.

As noted in the information, during an inspection at Meds IV starting on March 22, 2011, investigators from the U.S. Centers for Disease Control and Prevention (CDC) found S. marcescens that was indistinguishable from the outbreak strain on a tap-water faucet, in an open container of amino acid powder, and on the surface of mixing equipment that had been used to make TPN.  According to the charging document, the FDA and CDC investigators linked the S. marcescens to TPN that had been compounded by Meds IV.

As alleged in the information, Allen supervised all compounding at Meds IV, was specifically responsible for reviewing and approving TPN formulations and was also responsible for filling the individual prescriptions Meds IV received for patient-specific TPN products.  The information alleged that Rogers was ultimately responsible for overseeing all of the day-to-day operations of Meds IV.  Both defendants pleaded guilty to two misdemeanor counts, representing the two lots of amino acid which were determined to be adulterated in violation of the FDCA. 

The case was prosecuted by Trial Attorney Heide L. Herrmann of the Justice Department’s Consumer Protection Branch and Assistant U.S. Attorney Henry Cornelius of the Northern District of Alabama.  They were assisted by Associate Chief Counsel Shannon M. Singleton of the Food and Drug Division, Office of General Counsel, Department of Health and Human Services.  The case was investigated by the FDA’s Office of Criminal Investigations. 

Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Northern District of Alabama, visit its website at https://www.justice.gov/usao-ndal.

A San Antonio, Texas, artist was sentenced today in the U.S. District Court for the Western District of Texas in San Antonio to 12 months in prison by U.S. Magistrate Judge John W. Primomo, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.

Carlos Cortes pleaded guilty to one count of failure to file a 2009 tax return on April 21.  According to court documents, Cortes is an artist who works in the medium of “Faux Bois,” an artistic imitation of wood or wood grains in various media.  His work has been commissioned by the city of San Antonio along with several San Antonio businesses. 

According to Internal Revenue Service (IRS) records, Cortes did not file individual income tax returns for 2006, 2007, 2008 and 2009 despite earning gross income well in excess of the filing requirements.  Cortes admitted that he had gross income of $62,043 in 2006, $66,138 for 2007, $457,192 for 2008 and $781,847 for 2009.

Judge Primomo ordered Cortes remanded into the custody of the U.S. Marshal’s Service to begin serving his sentence immediately.  In addition to the prison term, Cortes was ordered to pay $404,433 in restitution and to serve one year of supervised release.  He was also fined $6,000.

Acting Assistant Attorney General Ciraolo thanked special agents of IRS-Criminal Investigation, who investigated the case and Trial Attorney Robert Kemins of the Tax Division, who prosecuted the case.

A federal grand jury sitting in Scranton, Pennsylvania, returned a superseding indictment today, charging a Forty Fort, Pennsylvania periodontist with one count of corruptly endeavoring to obstruct and impede the due administration of the internal revenue laws and two counts of filing false tax returns, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.

According to the allegations in the superseding indictment, Dr. Charles Musto filed false tax returns with the Internal Revenue Service (IRS) for the years 2008, 2009 and 2010 that underreported gross receipts of his periodontal practice.  During these years, Musto, who also owned rental real estate in the area, deposited gross receipts of his periodontal practice into multiple personal bank accounts, but only provided his accountant with the gross receipts that were deposited into the business bank account.  Musto also caused his personal expenditures to be falsely classified as business expenses in the books and records of the periodontal practice and the rental real estate business. 

If convicted, Musto faces a statutory maximum sentence of three years in prison for each count.  He also faces substantial monetary penalties and a term of supervised release.

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

Acting Assistant Attorney General Ciraolo thanked special agents of IRS-Criminal Investigation, who investigated the case, and Trial Attorneys Shawn T. Noud and William Guappone of the Tax Division, who are prosecuting the case.

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

A federal jury sitting in Oakland, California, found a local business owner guilty of three counts of tax evasion after an eight-day trial, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Brian Stretch of the Northern District of California. 

Richard T. Grant, 64, of Point Richmond, California, was a 50 percent owner of Grant Engineering and Manufacturing, a business that produces plastic injection molds.  The evidence presented at trial showed that for the tax years 2005 to 2009, Grant earned substantial income from the business.  Grant paid a certified public accountant to prepare tax returns for the business, but he did not file these returns with the Internal Revenue Service (IRS).  Grant also failed to file tax returns for himself during this period.

“Mr. Grant ignored his tax return filing obligations and when faced with IRS efforts to collect tax due, took deliberate steps to conceal income and evade paying his fair share,” said Acting Assistant Attorney General Ciraolo.  “The verdict in this case serves as a clear reminder that there is a heavy price to pay for tax crimes and the department is committed to holding those engaged in such criminal conduct accountable.”

“Mr. Grant cheated on his taxes and then tried to hide that fact from the IRS,” said U.S. Attorney Stretch.  “As a consequence, he now faces the real possibility of spending years in prison.  This office and our colleagues in the Department of Justice will pursue tax cheats wherever and whenever they intentionally short the public fisc.”

The evidence introduced at trial established that in 2005, close in time to the initiation of IRS’s collection efforts for his past due taxes, Grant significantly curbed the use of his two checking accounts and began moving his partnership distributions from Grant Engineering to a warehouse bank in Arkansas.  A warehouse bank commingles or pools clients’ funds for the purpose of concealing a particular client’s ownership of the funds.  Between April 2005 and October 2006, Grant funded multiple prepaid debit cards and wrote hundreds of checks out of the account toward his mortgage and other personal expenses.  When the warehouse bank was shut down as a result of a federal criminal investigation, Grant began converting his partnership distributions to cashier’s checks and cash at a local bank, avoiding depositing the vast majority of the funds into any bank account which he controlled.  He also used cash to purchase hundreds of U.S. Postal money orders to pay bills and expenses, including utilities, taxes and expenses for his classic aircraft.   

A sentencing hearing is scheduled on Sept. 28. Grant faces a maximum sentence of five years in prison for each count, as well as a term of supervised release and monetary penalties.  

Acting Assistant Attorney General Ciraolo and U.S. Attorney Stretch commended special agents of IRS–Criminal Investigation who investigated the case and Trial Attorney Matt Kluge of the Tax Division and Assistant U.S. Attorney Colin Sampson of the Northern District of California, who prosecuted the case.

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

The Justice Department today announced the closure of its case concerning the provision of language assistance to individuals with limited English proficiency (LEP) in the state court system following the successful implementation of reforms by the Colorado Judicial Department.

The Justice Department and the Colorado Judicial Department successfully resolved an investigation of an administrative complaint filed under Title VI of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race, color or national origin in federally funded programs or activities.

“The Justice Department will continue to work tirelessly to ensure equal access to justice for all people, regardless of their language ability,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division.  “We commend State Court Administrator Gerald Marroney and his staff for their dedicated, collaborative efforts to transform the delivery of language access services for the benefit of all.”

The complaint alleged that courts in Colorado were requiring LEP civil parties to bring their own interpreters to court.  In 2011, former Chief Justice Michael L. Bender and State Court Administrator Gerald Marroney signed a memorandum of agreement with the department.  At the same time, Chief Justice Bender amended Chief Justice Directive 06-03 to mandate that, effective immediately, qualified interpreters and other approved language assistance would be provided at no charge for LEP individuals in all court proceedings, services and programs.  Following further negotiations, the court’s Office of Language Access issued a comprehensive strategic plan in 2012 that defined 35 needed improvements to court policies, standards, infrastructure and training in order to support the court system’s ability to deliver timely and appropriate language assistance statewide.

Earlier this year, the Colorado Judicial Department completed the work required by the plan.  It also successfully complied with the monitoring requirements set forth in the memorandum of agreement, including further amending the Chief Justice Directive.  Today, after the court system completed the conditions for termination of the agreement, the department officially closed the case.

The department and the Colorado Judicial Department have worked cooperatively to improve communications between LEP court users and court personnel.  In addition to adopting the comprehensive language access policy contained in the Chief Justice Directive, the judiciary’s accomplishments include:

• Revised standards for testing, classifying and disciplining court interpreters, and devised standards to promote hiring of bilingual customer service staff and determine their proficiency in other languages;
• Created a centralized state telephone interpreter center staffed by certified court interpreters trained to provide remote interpreter assistance in limited circumstances and to assist personnel statewide in providing counter assistance for LEP customers;
• Convened an advisory committee including judges, administrators, interpreters and attorneys that provide recommendations on policies, procedures and implementation issues;
• Improved software to assign interpreters to proceedings;
• Translated hundreds of state and local court forms and signs into Spanish, and this year began translations into six other languages regularly encountered;
• Designed and delivered trainings and reference materials for judges, staff and interpreters and acquired access to on-line staff training modules;
• Designed and distributed signs in different formats and languages advising court visitors of the availability of language services at no cost;
• Began to integrate into pleadings and case management orders notice of the availability of interpreter assistance;
• And, improved the system for discipline of contract interpreters for violation of professional standards and created a language access complaint system.

The case was handled by Senior Attorney Paul M. Uyehara of the Civil Rights Division’s Federal Coordination and Compliance (FCS) Section.

The complaint was resolved as part of the FCS initiative to ensure that state courts comply with the language access requirements of Title VI.  To ensure that no LEP individual is denied justice due to a court’s failure to provide language services, the FCS courts team provides policy guidance and technical assistance to state court systems and undertakes enforcement actions across the country.

For further information about FCS and Title VI, please visit https://www.justice.gov/crt/fcs.  For additional LEP-related resources, please visit http://www.lep.gov/index.htm.

Colorado Judicial Department Closing Letter

Colorado Courts Release Vietnamese Translation

WASHINGTON – El Departamento de Justicia anunció hoy el cierre de su caso relacionado con la provisión de asistencia lingüística a personas con conocimientos limitados del inglés [Limited English Proficiency (LEP)] en el sistema judicial del estado, después de la exitosa implementación de reformas por parte del Poder Judicial de Colorado.

El Departamento de Justicia y el Poder Judicial de Colorado resolvieron con éxito una investigación de una demanda administrativa entablada bajo el Título VI de la Ley de Derechos Civiles de 1964, que prohíbe la discriminación basada en raza, color u origen nacional en programas o actividades con financiamiento federal. 

“El Departamento de Justicia seguirá trabajando sin descanso para garantizar la igualdad en el acceso a la justicia para todas las personas, independientemente de su capacidad lingüística,” declaró la Secretaria de Justicia Auxiliar Adjunta Principal Vanita Gupta, Directora de la División de Derechos Civiles del Departamento de Justicia.  “Felicitamos al Administrador de Tribunales Estatales Gerald Marroney y su equipo por su dedicación y colaboración para transformar el suministro de servicios de acceso idiomático para el beneficio de todos”. 

La demanda alegaba que los tribunales de Colorado exigían que partes civiles LEP llevaran sus propios intérpretes al tribunal.  En 2011, el ex-Juez Principal Michael L. Bender y el Administrador de Tribunales Estatales Gerald Marroney firmaron un memorando de acuerdo (en inglés) con el departamento.  En dicho momento, el Juez Principal Bender enmendó la Directiva 06-03 del Juez Principal de modo que, con vigencia inmediata, se ordenara la provisión de intérpretes calificados y otros tipos de asistencia lingüística aprobados, sin cargo para personas LEP en todos los procesos, servicios y programas judiciales.   Después de negociaciones adicionales, la Oficina de Acceso Idiomático del tribunal emitió un plan estratégico (en inglés) integral en 2012 que definió 35 mejoras necesarias en las políticas, normas, infraestructura y capacitación de los tribunales, como apoyo a la capacidad del sistema judicial de proveer asistencia lingüística oportuna y adecuada en todo el estado. 

Anteriormente este año, el Poder Judicial de Colorado completó el trabajo requerido por el plan.  También cumplió con éxito las exigencias de monitoreo establecidas en el memorando de acuerdo, incluida la enmienda adicional de la Directiva del Juez Principal (en inglés). Hoy, después de que el sistema judicial completó las condiciones para finalizar el acuerdo, el departamento cerró el caso oficialmente.

El departamento y el Poder Judicial de Colorado han trabajado en conjunto para mejorar las comunicaciones entre usuarios LEP de los tribunales y el personal de los tribunales.  Además de adoptar la política integral de acceso idiomático incluida en la Directiva del Juez Principal, los logros del Poder Judicial incluyen:

• Revisión de las normas para someter a prueba, clasificar y sancionar a los intérpretes judiciales, y normas establecidas para promover la contratación de personal de servicio al cliente bilingüe y determinar sus conocimientos de otros idiomas;

• Creación de un centro telefónico estatal centralizado de intérpretes compuesto por intérpretes judiciales certificados, para brindar asistencia de interpretación remota en circunstancias limitadas para asistir a personal de todo el estado en la provisión de asistencia a clientes LEP;

• Creó un comité asesor que incluye a jueces, administradores, intérpretes y abogados que proveen recomendaciones sobre políticas, procedimientos y asuntos relacionados con la implementación;

• Optimización del software utilizado para asignar intérpretes a procesos;

• Tradujo al español cientos de formularios y carteles de tribunales locales y estatales, y este año comenzó las traducciones a otros seis idiomas de uso habitual;

• Diseñó y realizó sesiones de capacitación y diseñó materiales de referencia para jueces, personal e intérpretes y adquirió acceso a módulos de capacitación de personal en Internet;

• Diseñó y distribuyó carteles en diferentes formatos e idiomas, que avisan a visitantes al tribunal de la disponibilidad de servicios lingüísticos sin cargo;

• Comenzó a incluir en alegatos y órdenes de gestión de casos un aviso de la disponibilidad de la asistencia de intérpretes;

• Y, mejoró el sistema de sanción de intérpretes contratados debido a la violación de normas profesionales, y creó un sistema de quejas relacionadas con el acceso idiomático.

Estuvo a cargo del caso el Abogado Principal Paul M. Uyehara de la Sección de Coordinación y Cumplimiento Federal [Federal Coordination and Compliance (FCS)] de la División de Derechos Civiles.

La demanda fue resuelta como parte de la iniciativa de la FCS para asegurar que los tribunales estatales cumplan con las exigencias de acceso idiomático del Título VI.  Para asegurar que no se le niegue justicia a ninguna persona LEP por la falta de servicios lingüísticos del tribunal, el equipo judicial de la FCS (en inglés) ofrece orientación sobre políticas y asistencia técnica a sistemas judiciales estatales y realiza acciones de coacción en todo el país.

Para obtener información adicional sobre la FCS y el Título VI, por favor visite https://www.justice.gov/crt/fcs.  Para acceder a recursos adicionales relacionados con LEP, visite http://www.lep.gov/index.htm.