District Not Recorded

Embarcadero Technologies Inc. and CA Inc. this week terminated Embarcadero’s proposed acquisition of CA Inc.’s ERwin data modeling product suite after the Department of Justice expressed continuing concern about the transaction’s potential for anticompetitive effects. 

Data modeling software is used to view and streamline enterprise data, centralize data management and reduce data redundancies.  An increase in the price of data modeling products would likely result in significant harm to users of these tools, the department said.

According to the department, Embarcadero’s ER Studio products and CA’s ERwin have been particularly close competitors.  By purchasing the ERwin Data Modeler, Embarcadero Technologies would have eliminated a vigorous competitor that has competed to provide expanded functionality and more affordable pricing in recent years. 

Embarcadero Technologies Inc., based in San Francisco, California, is owned by private equity group Thoma Cressey Bravo and provides software to build, test, optimize, and manage application infrastructure and databases for large corporations and government agencies.  CA Inc., based in Islandia, New York, provides software and other tools for managing networks, databases, applications, storage, security, and other systems.   

A Detroit-area resident was arrested today for his role in a $2.7 million home health care fraud scheme.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Chicago Regional Office made the announcement.

Javed Akhtar, 47, of Brownstown, Michigan, was arrested pursuant to a criminal complaint charging him with participating in a health care fraud scheme involving two home health agencies in Wayne, Michigan:  Life Choice Home Health Care LLC (Life Choice), which he owned, and Angle’s Touch Home Health Care LLC (Angle’s Touch).  Both Life Choice and Angle’s Touch purported to provide in-home health care services to Medicare beneficiaries. 

According to the complaint, Akhtar served as a patient recruiter for Angle’s Touch and Life Choice, where he allegedly paid kickbacks to Medicare beneficiaries in exchange for their Medicare beneficiary information and their signatures on false medical records.  The complaint alleges that Angle’s Touch and Life Choice then billed Medicare for services purportedly provided to those beneficiaries that were not actually provided, were not medically necessary, or in instances where the claims were illegally procured through the payment of kickbacks. 

The charges contained in a complaint are merely accusations, and a defendant is presumed innocent unless and until proven guilty.

This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.  This case is being prosecuted by Trial Attorney Niall M. O’Donnell of the Criminal Division’s Fraud Section. 

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.

The following statement is attributable to Justice Department spokesman Brian Fallon regarding Attorney General Eric Holder’s visit to the Civil Rights Division’s Voting Section this election day:

“This afternoon, Attorney General Holder visited the offices of the Civil Rights Division’s Voting Section, which are located in downtown Washington. The Attorney General thanked the lawyers and staff for monitoring calls and fielding election-related complaints of potential violations of federal voting laws. The Attorney General told them their work is among the most critical responsibilities that the Department performs.

“The Civil Rights Division enforces a range of voting-related statutes, including the Voting Rights Act, the National Voter Registration Act, the Uniformed and Overseas Citizens Absentee Voting Act and the Help America Vote Act. Lawyers in the division’s Voting Section have been staffing a hotline since early this morning, fielding calls from across the country.

“In addition to monitoring calls to the Voting Section, the department has dispatched federal poll monitors to 28 jurisdictions across 18 states to gather information on numerous aspects of local election procedures. The Justice Department will continue to work in a fair and nonpartisan manner to ensure that every voter can cast his or her ballot free of intimidation, discrimination or obstruction.” 

The Justice Department today announced that Longview, Washington, landlords Linda and Bert Barber, and their management agent, Lori Thompson, have entered into a consent decree and have agreed pay $25,000 to resolve claims that they discriminated on the basis of disability by refusing to grant a reasonable accommodation to waive a $1,000 pet deposit for a tenant with mental disabilities who needed a dog as an emotional support animal.

The consent decree resolves a lawsuit filed by the department on July 1, 2013, alleging that the defendants refused to grant a waiver of the pet deposit despite numerous attempts by the tenant to provide documentation of her disability and her need for the emotional support animal.  The complaint also alleged that the defendants retaliated against the tenant after she filed a complaint with the U.S. Department of Housing and Urban Development (HUD).  After HUD investigated the complaint, it issued a charge of discrimination and referred the matter to the Justice Department.  The department’s complaint also alleged that defendants’ policies constituted a pattern or practice of discrimination in violation of the Fair Housing Act because they allowed reasonable accommodations for specially-trained service animals but precluded reasonable accommodations for emotional support animals.  Defendants also refused to consider accommodation requests unless tenants had their physician complete forms that threatened penalty of perjury and threatened to require the physician to defend the information provided in court.  Trial was set to begin on Nov. 19.

The settlement, which was approved today by Judge Benjamin H. Settle, requires the defendants to pay $20,000 to the HUD complainant and $5,000 to the United States.  The settlement also requires that the defendants adopt a reasonable accommodation policy that complies with the Fair Housing Act, receive training on the requirements of the Fair Housing Act and report to the department for a period of eighteen months on their compliance with the settlement.

“The Fair Housing Act ensures that persons with disabilities have an equal opportunity to use and enjoy housing,” said Acting Assistant Attorney General Vanita Gupta.  “This includes providing reasonable and necessary accommodations to persons who need assistance animals to help them with their disabilities.  The Justice Department will continue its vigorous enforcement of fair housing laws that protect the rights of persons with disabilities.”

“Landlords may not impose barriers that undermine the housing rights of people with disabilities,” said Acting United States Attorney Annette L. Hayes.  “This settlement requires training for property managers, and clear statements in all advertisements about fair housing/non-discrimination policies to ensure this conduct will not be repeated.”

“Property owners have a legal obligation to permit reasonable accommodations where doing so allows persons with disabilities to fully enjoy their homes,” said HUD Assistant Secretary Gustavo Velasquez for Fair Housing and Equal Opportunity.  “This consent decree reaffirms HUD’s commitment to working with the Department of Justice to take appropriate action anytime the Fair Housing Act is violated.” 

Fighting illegal housing discrimination is a top priority of the Department of Justice.  The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status.  More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt.  Individuals who believe that they may have been victims of housing discrimination can call the Justice Department at 1-800-896-7743, e-mail the Justice Department at fairhousing@usdoj.gov, or contact HUD at 1-800-669-9777 or through its website at http://portal.hud.gov/hudportal/HUD?src=/program_offices/fair_housing_equal_opp.

Irek Ilgiz Hamidullin made his first appearance today in the U.S. District Court for the Eastern District of Virginia on federal terrorism offenses arising from his alleged participation in an attack on U.S. troops and Afghan Border Police in the Khost Province of Afghanistan in November 2009.

Hamidullin was indicted by a federal grand jury on twelve counts, including conspiring to provide and providing material support to terrorists; conspiring and attempting to destroy an aircraft of the armed forces of the United States; conspiring and attempting to murder a national of the United States; and other offenses.

The charges carry a potential maximum penalty of life imprisonment.

Hamidullin, a Russian national approximately 55 years of age, was taken into custody in November 2009 and held by the Department of Defense in Afghanistan until being turned over to the FBI on Nov. 3 and brought to the United States to face charges. 

The defendant was indicted on Oct. 8, 2014, and the charging document was unsealed today.

Arraignment is set for Friday at 10:00 a.m. in front of U.S. District Judge Henry E. Hudson at the federal courthouse in Richmond, Virginia.

An indictment is merely a formal allegation that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty. 

The case is being investigated by the FBI’s Washington Field Office with substantial assistance from various other government agencies.  The case is being prosecuted by the U.S. Attorney’s Office for the Eastern District of Virginia and the Counterterrorism Section of the Justice Department’s National Security Division.

The Department of Justice and the U.S. Environmental Protection Agency (EPA) today announced a historic settlement with the automakers Hyundai and Kia that will resolve alleged Clean Air Act violations based on their sale of close to 1.2 million vehicles that will emit approximately 4.75 million metric tons of greenhouse gases in excess of what the automakers certified to EPA.

The automakers will pay a $100 million civil penalty, the largest in Clean Air Act history, to resolve violations concerning the testing and certification of vehicles sold in America and spend approximately $50 million on measures to prevent any future violations.  Hyundai and Kia will also forfeit 4.75 million greenhouse gas emission credits that the companies previously claimed, which are estimated to be worth over $200 million.  Automakers earn greenhouse gas emissions credits for building vehicles with lower emissions than required by law.  These credits can be used to offset emissions from less fuel efficient vehicle models or sold or traded to other automakers for the same purpose.  The greenhouse gas emissions that the forfeited credits would have allowed are equal to the emissions from powering more than 433,000 homes for a year. 

“This unprecedented resolution with Hyundai and Kia underscores the Justice Department’s firm commitment to safeguarding American consumers, ensuring fairness in every  marketplace, protecting the environment, and relentlessly pursuing companies that make misrepresentations and violate the law,” said Attorney General Eric Holder.  “This type of conduct quite simply will not be tolerated.  And the Justice Department will never rest or waver in our determination to take action against any company that engages in such activities – whenever and wherever they are uncovered.”

“Greenhouse gas emission laws protect the public from the dangers of climate change, and today’s action reinforces EPA’s commitment to see those laws through,” said EPA Administrator Gina McCarthy.  “Businesses that play by the rules shouldn’t have to compete with those breaking the law.  This settlement upholds the integrity of the nation’s fuel economy and greenhouse gas programs and supports all Americans who want to save fuel costs and reduce their environmental impact.”

The complaint was filed today jointly by the United States and the California Air Resources Board in the U.S. District Court for the District of Columbia.  It alleges that the car companies sold close to 1.2 million cars and SUVs from model years 2012 and 2013 whose design specifications did not conform to the specifications the companies certified to EPA, which led to the misstatements of greenhouse gas emissions.  These allegations concern the Hyundai Accent, Elantra, Veloster and Santa Fe vehicles and the Kia Rio and Soul vehicles.

Additionally Hyundai and Kia gave consumers inaccurate information about the real-world fuel economy performance of many of these vehicles.  Hyundai and Kia overstated the fuel economy by one to six miles per gallon, depending on the vehicle.  Similarly, they understated the emissions of greenhouse gases by their fleets by approximately 4.75 million metric tons over the estimated lifetime of the vehicles.

In order to reduce the likelihood of future vehicle greenhouse gas emission miscalculations, Hyundai and Kia have agreed to reorganize their emissions certification group, revise test protocols, improve management of test data and enhance employee training before they conduct emissions testing to certify their model year 2017 vehicles.  In the meantime, Hyundai and Kia must audit their fleets for model years 2015 and 2016 to ensure that vehicles sold to the public conform to the description and data provided to EPA.

EPA discovered these violations in 2012 during audit testing.  Subsequent investigation revealed that Hyundai’s and Kia’s testing protocol included numerous elements that led to inaccurately higher fuel economy ratings.  In processing test data, Hyundai and Kia allegedly chose favorable results rather than average results from a large number of tests.

In November 2012, Hyundai and Kia responded to the EPA’s findings by correcting the fuel economy ratings for many of their 2011, 2012 and 2013 model year vehicles and establishing a reimbursement program to compensate owners for increased fuel costs due to overstated fuel economy.

This case involves five different entities: Hyundai Motor Company, Hyundai Motor America, Kia Motors Corporation, Kia Motors America and Hyundai America Technical Center Inc.

The California Air Resources Board joined the United States as a co-plaintiff in this settlement, and will receive $6,343,400 of the $100 million civil penalty. 

The proposed consent decree is subject to a 30-day public comment period and court review and approval.  A copy of the consent decree is available on the Department of Justice website at www.justice.gov/enrd/Consent_Decrees.html.

For more information http://www2.epa.gov/enforcement/hyundai-and-kia-clean-air-act-settlement

Lamont Deshawn Byrd was sentenced today in federal court in Raleigh, North Carolina, to serve life in prison for committing first degree murder of an Officer of the United States, announced U.S. Attorney Thomas G. Walker for the Eastern District of North Carolina.  Byrd, 22, pleaded guilty on Aug. 4, 2014, to killing Warren Basco “Sneak” Lewis III with premeditation and malice on June 9, 2011.  Lewis was an investigator with the Nash County Sheriff’s Office who was also a sworn special deputy United States marshal assigned to the Eastern North Carolina Regional Fugitive Task Force.

The investigation began on June 2, 2011, in Kinston, North Carolina when officers responded to a shots fired call and found homicide victim Thomas Terrell Hinton fatally shot in the chest.  The investigation determined that Byrd, Kion Tyearl Dail and two additional juveniles murdered Mr. Hinton and then stole his bicycle.  Murder warrants were issued for the arrest of the aforementioned individuals and law enforcement began looking for the suspects.

On June 9, 2011, Kinston officers, along with U.S. Deputy Marshals attempted to locate the suspects utilizing warrants and executed a search warrant at 602-A West Lenoir Avenue, Kinston, North Carolina.  This address is a residence which has been converted into three separate apartments; one upstairs and two downstairs.  Although it appeared that 602-A had been inhabited, the apartment was now empty.  However, two shotguns were located.  Laboratory testing revealed that Byrd had possessed the weapons.  Earlier Byrd and several others had moved to Apt B downstairs. 

Later that day, after developing additional information, law enforcement officers went back to the Lenoir Avenue apartments.  While searching for the suspects, law enforcement officers announced their presence.  As Investigator Lewis was coming down the stairs from the upstairs apartment, Byrd shot three times through the closed door, striking the deputy all three times.  After realizing he had shot an officer, Byrd was heard to utter, “See what you made me do?”  Byrd then handed the weapon to another individual to hide.  After a 20-minute stand-off, the individuals came out.  The weapon, a Berretta .40 caliber semi-automatic pistol, was found in a banker’s box in a closet, with Byrd’s DNA on it.  The weapon had been stolen from a residence three weeks prior.

Investigator Lewis was transported to the hospital where he later died from his injuries.

“The death of Special Deputy Lewis is a tragedy for his family and all of us in the law enforcement community,” said U.S. Attorney Walker;

“As a key member of the Eastern North Carolina Regional Fugitive Task Force, Special Deputy U. S. Marshal Warren Lewis was a vital part of the U. S. Marshals’ family, just as he was with the Nash County Sheriff’s Office,” said Director Stacia Hylton of the U.S. Marshals Service.  “Warren Lewis will always be remembered to us and the entire law enforcement community as a hero and for making the ultimate sacrifice to protect others.  We hope that with this sentencing that Warren Lewis’ family can start to feel a small level of peace and closure after suffering their tragic loss.”

“Today’s sentencing is the result of a tragedy and loss of human life that was not necessary,” said ATF Special Agent in Charge Wayne Dixie.  “Anyone that uses a firearm to commit a violent criminal act, especially the murder of a law enforcement officer, will be held accountable for their actions.  We will continue to use all of our resources to prosecute those that choose to commit this type of heinous act.”

“Law enforcement officers put their lives on the line every day to protect our communities, and they deserve our respect and gratitude,” said North Carolina Attorney General Roy Cooper.  “The death of Investigator Lewis was a tremendous loss to his family and our community and the end of this case helps bring justice.” 

“The Lewis family and the State of North Carolina lost a true hero,” said Director Bill Johnson of the Kinston Department of Public Safety.  “I wish to thank the many individuals and agencies for their assistance in the effort to see justice done.”

According to the plea agreement, Byrd has also pleaded guilty to murder charges in state court and is awaiting sentencing.

The investigation was conducted by the North Carolina State Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Kinston Department of Public Safety.

The prosecution is being handled by Assistant U.S. Attorney Jane J. Jackson and Imelda J. Pate, Assistant District Attorney for the Eighth District.

 

In anticipation of tomorrow’s general election, the Justice Department today provided information about its efforts, through the Civil Rights Division and Criminal Division, to ensure that all qualified voters have the opportunity to cast their ballots and have their votes counted free of discrimination, intimidation or fraud in the election process.

Civil Rights Division:

The Civil Rights Division is responsible for ensuring compliance with the civil provisions of federal statutes that protect the right to vote, and with the criminal provisions of federal statutes prohibiting discriminatory interference with that right. 

The Civil Rights Division’s Voting Section enforces the civil provisions of a wide range of federal statutes that protect the right to vote including: the Voting Rights Act; the National Voter Registration Act; the Uniformed and Overseas Citizens Absentee Voting Act; and the Help America Vote Act.  Among other things, collectively, these laws:

• prohibit election practices that have either a discriminatory purpose based on race or membership in a minority language group or a discriminatory result of members of racial or language minority groups having less opportunity than other citizens to participate in the political process;
• prohibit intimidation of voters;
• provide that voters who need assistance in voting because of disability or illiteracy can obtain assistance from a person of their choice;
• require minority language election materials and assistance in certain jurisdictions;
• provide for accessible election machines for voters with disabilities;
• require provisional ballots for voters who assert they are eligible but whose names do not appear on poll books;
• provide for absentee ballots for service members, their family members and U.S. citizens living abroad;
• require states to ensure that citizens can register at drivers’ license offices, public assistance offices, other state agencies and through the mail; and
• include requirements regarding maintaining voter registration lists.

The Civil Rights Division’s Criminal Section enforces federal criminal statutes that prohibit voter intimidation and vote suppression based on race, color, national origin or religion.

On Election Day, Nov. 4, 2014, the Civil Rights Division will implement a comprehensive program to help ensure the right to vote that will include the following:

• The Civil Rights Division will conduct monitoring in the field at polling places.
• Civil Rights Division attorneys in both the Voting and Criminal Sections in Washington, D.C., will be ready to receive election-related complaints of potential violations relating to any of the statutes the Civil Rights Division enforces.  Attorneys in the division will take appropriate action and will consult and coordinate with local U.S. Attorneys’ Offices and with other entities within the Department of Justice concerning these complaints before, during, and after Election Day.
• Civil Rights Division staff will be available by phone to receive complaints related to voting rights (1-800-253-3931 toll free or 202-307-2767) or by TTY (202-305-0082).  In addition, individuals may also report complaints, problems, or concerns related to voting by fax to 202-307-3961, by email to voting.section@usdoj.gov, and, by complaint forms that may be submitted through a link on the Department’s website, at www.justice.gov/crt/about/vot/.
• Complaints related to violence, threats of violence, or intimidation at a polling place should always be reported immediately to local police authorities by calling 911.  They should also be reported to the Department after local authorities are contacted.

Criminal Division and the Department’s 94 U.S. Attorneys’ Offices:

The Department’s Criminal Division oversees the enforcement of federal laws that criminalize certain forms of election fraud and vindicate the integrity of the federal election process.

The Criminal Division’s Public Integrity Section and the Department’s 94 U.S. Attorneys’ Offices are responsible for enforcing the federal criminal laws that prohibit various forms of election fraud, such as vote buying, multiple voting, submission of fraudulent ballots or registrations, destruction of ballots or registrations, alteration of votes, and malfeasance by election officials.  The Criminal Division is also responsible for enforcing federal criminal law prohibiting voter intimidation for reasons other than race, color, national origin or religion (as noted above, voter intimidation that has a basis in race, color, national origin or religion is addressed by the Civil Rights Division).

The U.S. Attorney’s Offices around the country designate Assistant U.S. Attorneys who serve as district election officers (DEOs) in their respective districts.  DEOs are responsible for overseeing potential election-crime matters in their districts, and for coordinating with the department’s election-crime experts in Washington, D.C. 

On Nov. 4, 2014, the U.S. Attorneys’ Offices will work with specially trained Federal Bureau of Investigation personnel in each district to ensure that complaints from the public involving possible voter fraud are handled appropriately. Specifically: 

• In consultation with federal prosecutors at the Public Integrity Section in Washington, D.C., the District Election Officers  in U.S. Attorneys’ Offices, FBI officials at headquarters in Washington, D.C., and FBI Special Agents serving as Election Crime Coordinators in the FBI’s 56 field offices will be on duty while polls are open, to receive complaints from the public.
• Election-crime complaints should be directed to the local U.S. Attorney’s Office or the local FBI office.  A list of U.S. Attorneys’ Offices and their telephone numbers can be found at http://www.justice.gov/usao/districts/.  A list of FBI offices and accompanying telephone numbers can be found at www.fbi.gov/contact-us.
• Public Integrity Section prosecutors are available to consult and coordinate with the U.S. Attorneys’ Offices and the FBI regarding the handling of election-crime allegations.
• Again, complaints related to violence, threats of violence, or intimidation at a polling place should be reported first to local police authorities by calling 911. 

Both protecting the right to vote and combating election fraud are essential to maintaining the confidence of all Americans in our democratic system of government.  The department encourages anyone who has information suggesting voting discrimination or ballot fraud to contact the appropriate authorities.

The Department of Justice filed a civil antitrust lawsuit today seeking to block National CineMedia Inc.’s (NCM) $375 million acquisition of Screenvision LLC.  The department said that the acquisition would combine the only two significant cinema advertising networks in the United States, eliminating competition that has substantially benefitted movie theaters, advertisers and, ultimately, movie goers. 

The Antitrust Division’s lawsuit, which seeks to prevent the companies from merging and to preserve their existing head-to-head competition, was filed in the United States District Court for the Southern District of New York.

“The proposed combination of NCM and Screenvision is a bad deal for movie theaters, advertisers and consumers.  This merger to monopoly is exactly the type of transaction the antitrust laws were designed to prohibit,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division.  “If this deal is allowed to proceed, the benefits of competition will be lost, depriving theaters and advertisers of options for cinema advertising network services and risking higher prices to movie goers.” 

Cinema advertising networks are intermediaries between movie theaters and advertisers.  The networks create “pre-shows” – 20 to 30 minute long programs combining advertisements with special content – which movie theaters play prior to the start of each movie.  The cinema advertising networks and movie theaters share the advertising revenue based on the specific financial terms of each theater’s contract.

According to the department’s complaint, NCM and Screenvision together serve 88 percent of all movie theater screens in the United States through long-term, exclusive contracts. 

Over the past two years, competition between NCM and Screenvision intensified as Screenvision became a particularly aggressive competitor, increasing its efforts to steal business from NCM by dramatically reducing the prices it charges advertisers and offering movie theaters a variety of attractive financial incentives.  The complaint contains statements from NCM’s and Screenvision’s executives describing the competition between the two companies and the motivation to end that competition by entering into the transaction:

• Aggressive competition between NCM and Screenvision for movie theaters led NCM to observe that “we need to buy [Screenvision] before either us or [Screenvision] does a stupid deal.”

• By April 2014, NCM arrived at what it called a “Strategy Decision Crossroads.”  As NCM had told its board it could either acquire Screenvision, which would give NCM the ability to “Control Selling Tactics,” including “Pricing,” or it could compete through more aggressive pricing and adding theaters to its network.  NCM chose to buy out its competitor.

• NCM viewed Screenvision’s “new strategy of undercutting [NCM’s] pricing by 50 percent (or more) [as] a direct threat to [NCM’s] business model” and “a very unusual strategy in a duopoly.”

The complaint alleges that, by eliminating competition, the merger likely will result in advertisers paying more for cinema advertising and movie theaters receiving less revenue.  For movie theaters, the revenue earned through pre-show advertisements provides an important source of income.  Reduced advertising revenues are likely to result in movie theaters having to raise ticket or concession prices to consumers or forego theater upkeep and improvements. 

The three largest movie theater circuits in the United States – Regal Entertainment Group, AMC Entertainment Inc. and Cinemark Holdings Inc. – together are the majority owners of NCM.  The complaint alleges that these three circuits – which NCM refers to as the “Founding Members” – exercise significant control and influence over NCM’s actions, including the right to block NCM from entering into contracts with independent movie theaters that contain upfront payments exceeding $1 million.  Such payments have been an important area of competition between NCM and Screenvision. 

National CineMedia LLC is a Delaware company headquartered in Centennial, Colorado.  It has contracts with 39 movie theaters, creating a cinema advertising network with nationwide coverage of approximately 19,800 of the 39,000 movie screens in the United States.  In 2013, NCM earned approximately $426 million in advertising revenue.

National CineMedia Inc. is Delaware corporation also headquartered in Centennial, Colorado.  It is the managing member and minority owner of National CineMedia LLC. 

Screenvision LLC and its parent, SV Holdco LLC, are Delaware companies headquartered in New York, New York.  Screenvision has contracts with 177 movie theaters, with nationwide coverage of approximately 14,200 screens.  In 2013, Screenvision earned approximately $160 million in advertising revenue.

The Justice Department announced today that its Civil Rights Division plans to conduct in-person monitoring of polling place activities in 28 jurisdictions in 18 states for the Nov. 4, 2014, general election.  The Attorney General also released a video on election monitors today.

Although state and local governments have primary responsibility for administering elections, the Civil Rights Division is charged with enforcing the federal voting rights laws that protect the rights of all eligible citizens to cast ballots on Election Day.

In the days leading up to and throughout Election Day, Civil Rights Division staff members will also be available by telephone to receive complaints from citizens in all states and jurisdictions nationwide related to possible violations of the federal voting rights laws (toll free 1-800-253-3931 or 202-307-2767) or TTY (202-305-0082).  In addition, individuals may also report such complaints by fax to 202-307-3961, by email to voting.section@usdoj.gov and by a complaint form on the department’s website: www.justice.gov/crt/about/vot/.  

Allegations of election fraud are handled by the 94 U.S. Attorneys’ Offices across the country, the Federal Bureau of Investigation and the Criminal Division’s Public Integrity Section.  Complaints related to election fraud may be directed to your local U.S. Attorneys’ Offices or local FBI offices, which consult with the Public Integrity Section in Washington, D.C.  A list of U.S. Attorneys’ Offices and their telephone numbers can be found at http://www.justice.gov/usao/districts/.  A list of FBI offices and accompanying telephone numbers can be found at www.fbi.gov/contact-us.  

As always, complaints related to violence, threats of violence, or intimidation at a polling place should always be reported immediately to local police authorities by calling 911.  They should also be reported to the department after local authorities have been contacted.

Since the passage of the Voting Rights Act of 1965, the department has regularly monitored elections in the field in jurisdictions around the country to protect the rights of voters.  The Voting Rights Act prohibits discrimination in the election process on the basis of race, color or membership in a minority language group.  In addition, the act requires certain jurisdictions to provide language assistance during the election process. 

On Nov. 4, 2014, the department will monitor polling place activities on the ground in 28 jurisdictions:

• Maricopa County, Arizona;

• Alameda County, California;

• Napa County, California;

• Duval County, Florida;

• Hillsborough County, Florida;

• Lee County, Florida;

• Orange County, Florida;

• Fulton County, Georgia;

• Gwinnett County, Georgia;

• Chicago, Illinois;

• Finney County, Kansas;

• Robeson County, North Carolina;

• Colfax County, Nebraska;

• Douglas County, Nebraska;

• Bergen County, New Jersey;

• Cibola County, New Mexico;

• Orange County, New York;

• Cuyahoga County, Ohio;

• Hamilton County, Ohio;

• Lorain County, Ohio;

• Lehigh County, Pennsylvania;

• Richland County, South Carolina;

• Charles Mix County, South Dakota;

• Shannon County; South Dakota;

• Shelby County, Tennessee;

• Harris County, Texas;

• Waller County, Texas; and

• Milwaukee, Wisconsin.

The department’s monitoring will gather information on, among other things, whether voters are subject to different voting qualifications or procedures on the basis of race, color, or membership in a language minority group; whether jurisdictions are complying with the minority language provisions of the Voting Rights Act; whether jurisdictions permit voters to receive assistance by a person of his or her choice if the voter is blind, has a disability, or is unable to read or write; whether jurisdictions allow voters with disabilities to cast a private and independent ballot; whether jurisdictions comply with the voter registration list requirements of the National Voter Registration Act; and whether jurisdictions comply with the provisional ballot requirements of the Help America Vote Act.  Department personnel also will maintain contact with local election officials.

More information about the Voting Rights Act and other federal voting and election-related laws is available on the Civil Rights Division’s web site at www.justice.gov/crt/about/vot/.  

A leading member of an online piracy group pleaded guilty today for his role in a scheme to distribute more than one million pirated copies of copyrighted Android mobile device applications, or “apps,” with a total retail value of more than $1.7 million.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Sally Quillian Yates of the Northern District of Georgia and Special Agent in Charge J. Britt Johnson of the FBI’s Atlanta Field Office made the announcement.

Scott Walton, 28, of Cleveland, Ohio, pleaded guilty today to one count of conspiracy to commit criminal copyright infringement before U.S. District Judge Timothy C. Batten Sr. of the Northern District of Georgia.  Walton will be sentenced at a later date.  A second co-conspirator, Kody Jon Peterson, 22, of Clermont, Florida, pleaded guilty to an information on April 14, 2014, for his role in the conspiracy. 

According to statements made in court, Walton and his fellow conspirators identified themselves as members of the SnappzMarket Group.  From May 2011 through August 2012, they conspired to reproduce and distribute over one million copies of copyrighted Android mobile device apps.  The apps had a total retail value of over $1.7 million and were distributed through the SnappzMarket alternative online market without permission from the victim copyright owners, who would otherwise sell copies of the apps on legitimate online markets for a fee. 

The indictment charges Walton and two other leading members of the SnappzMarket Group with conspiracy to commit criminal copyright infringement and related charges for allegedly distributing the copyrighted Android mobile devices apps through the group’s website, www.snappzmarket.com.  On Aug. 21, 2012, the FBI executed a seizure order against the website, which was the first time a website domain involving mobile device app marketplaces had been seized.

The charges contained in an indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.

The investigation was conducted by the FBI.  The case is being prosecuted by Assistant Deputy Chief John H. Zacharia of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) and Assistant U.S. Attorney Christopher Bly of the Northern District of Georgia.  Significant assistance was provided by the CCIPS Cybercrime Lab and the Criminal Division’s Office of International Affairs. 

A California-based medical diagnostics and life sciences manufacturing and sales company, Bio-Rad Laboratories Inc. (Bio-Rad), has agreed to pay a $14.35 million penalty to resolve allegations that it violated the Foreign Corrupt Practices Act (FCPA) by falsifying its books and records and failing to implement adequate internal controls in connection with sales it made in Russia.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Special Agent in Charge David J. Johnson of the FBI’s San Francisco Field Office made the announcement.

“Public companies that cook their books and hide improper payments foster corruption,” said Assistant Attorney General Caldwell.  “The department pursues corruption from all angles, including the falsification of records and failure to implement adequate internal controls.   The department also gives credit to companies, like Bio-Rad, who self-disclose, cooperate and remediate their violations of the FCPA.”

“The FBI remains committed to identifying and investigating violations of the Foreign Corrupt Practices Act,” said Special Agent in Charge Johnson.  “This action demonstrates the benefits of self-disclosure, cooperation, and subsequent remediation by companies.”

According to the company’s admissions in the agreement, Bio-Rad SNC, a Bio-Rad subsidiary located in France, retained and paid intermediary companies commissions of 15-30 percent purportedly in exchange for various services in connection with certain governmental sales in Russia.  The intermediary companies, however, did not perform these services.  Several high-level managers at Bio-Rad, responsible for overseeing Bio-Rad’s business in Russia, reviewed and approved the commission payments to the intermediary companies despite knowing that the intermediary companies were not performing such services.  These managers knowingly caused the payments to be falsely recorded on Bio-Rad SNC’s and, ultimately, Bio-Rad’s books.  Bio-Rad, through several of its managers, also failed to implement adequate controls, as well as adequate compliance systems, with regard to its Russian operations while knowing that the failure to implement such controls allowed the intermediary companies to be paid significantly above-market commissions for little or no services.

The department entered into a non-prosecution agreement with the company due, in large part, to Bio-Rad’s self-disclosure of the misconduct and full cooperation with the department’s investigation.  That cooperation included voluntarily making U.S. and foreign employees available for interviews, voluntarily producing documents from overseas, and summarizing the findings of its internal investigation.  In addition, Bio-Rad has engaged in significant remedial actions, including enhancing its anti-corruption policies globally, improving its internal controls and compliance functions, developing and implementing additional due diligence and contracting procedures for intermediaries, and conducting extensive anti-corruption training throughout the organization.

In addition to the monetary penalty, Bio-Rad agreed to continue to cooperate with the department, to report periodically to the department for a two-year period concerning Bio-Rad’s compliance efforts, and to continue to implement an enhanced compliance program and internal controls designed to prevent and detect FCPA violations. 

In a related matter, the U.S. Securities and Exchange Commission (SEC) today announced that it had entered into a cease and desist order against Bio-Rad in which the company agreed to pay $40.7 million in disgorgement and prejudgment interest in connection with the company’s sales in Russia, as well as in Thailand and Vietnam.

The department acknowledges and expresses its appreciation for the assistance provided by the SEC’s Division of Enforcement.

The case is being investigated by the FBI’s San Francisco Field Office.  The case is being prosecuted by Trial Attorney Andrew Gentin of the Criminal Division’s Fraud Section.  

Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.

In an effort to reaffirm the Justice Department’s commitment and responsibility to protect eligible Americans from discrimination at the ballot box, Attorney General Eric Holder released a video today to announce that the Department of Justice will send federal monitors to 18 states across the country.  These monitors will be on the ground gathering information on numerous aspects of local election procedures including voter discrimination, resources for bilingual voters, and adequate services for individuals with disabilities.

“This year, as citizens across the country go to the polls on Election Day, I want the American people to know that the Justice Department will stand vigilant – working, in a fair and nonpartisan manner, to ensure that every voter can cast his or her ballot free of intimidation, discrimination, or obstruction,” said Attorney General Holder in a video message recorded for the Justice Department’s website.  “Over the last few months, leaders from the Voting Section of the Civil Rights Division have received information from a wide variety of citizens and groups.  Based upon our independent and non-partisan consideration and expertise, we have dispatched federal monitors to polling places around the country – just as we do during every election season.”

The complete text of the Attorney General’s video message is below:

“One of the Justice Department’s most sacred responsibilities is ensuring access to the ballot box for every eligible American.  Over the last six years, my colleagues and I have taken robust action to safeguard this fundamental right: challenging unnecessarily restrictive proposals like certain voter ID laws; advocating for accessible polling places in remote and underserved communities; and fighting back against redistricting proposals and early voting limits that may prevent many Americans from making their voices heard.

“This year, as citizens across the country go to the polls on Election Day, I want the American people to know that the Justice Department will stand vigilant – working, in a fair and nonpartisan manner, to ensure that every voter can cast his or her ballot free of intimidation, discrimination, or obstruction.  Over the last few months, leaders from the Voting Section of the Civil Rights Division have received information from a wide variety of citizens and groups.  Based upon our independent and non-partisan consideration and expertise, we have dispatched federal monitors to polling places around the country – just as we do during every election season.

“These officials will gather information on numerous aspects of local election procedures, including whether voters are treated differently depending on their race or color; whether jurisdictions are adequately serving individuals with disabilities; whether jurisdictions are complying with the provisional ballot requirements of the Help America Vote Act; and whether jurisdictions are complying with the Voting Rights Act’s requirement to provide bilingual election materials and assistance in areas of need.

“The integrity of our elections, and the ability of our citizens to access the franchise, are fundamental to who we are – both as a nation and as a people.  That’s why, last year, President Obama established a bipartisan Presidential Commission on Election Administration to recommend a series of steps to make it simpler to cast a ballot.  The Commission’s recommendations included expanding online voter registration and early balloting, updating electronic voting equipment, and making polling places more accessible.  The Commission also suggested that bilingual poll workers should be available at any polling place with a significant number of voters who do not speak English.

“These are promising – and necessary – reforms, and I call upon jurisdictions across the country to adopt them.  In the meantime, we must also ensure that the way we administer the laws currently on the books is appropriate, and lives up to our highest values.  Making it more difficult to vote with restrictive measures like burdensome voter ID laws is out of step with our history.

“So I call on election officials and poll workers around the country to consider, as they perform their duties, the importance of the responsibilities that they are working to fulfil.  I encourage every citizen of this country to remember the sacrifices made by generations of patriots to expand and ensure the franchise.  And I urge all eligible Americans – no matter their party affiliation or political views – to exercise their own sacred duty to cast a ballot, to make their voices heard, and to contribute to the direction of our great democracy.”

The full video of the Attorney General’s message is available at http://www.justice.gov/agwa.php.

An owner and operator of two community mental health centers in Baton Rouge, Louisiana, and a patient recruiter for a community mental health center in Houston, Texas, were sentenced  to prison today for their involvement in a $258.5 million Medicare fraud scheme involving partial hospitalization psychiatric (PHP) services. 

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney J. Walter Green of the Middle District of Louisiana, Special Agent in Charge Mike Fields of the U.S. Department of Health and Human Services Office of the Inspector General’s (HHS-OIG) Dallas Office, Special Agent in Charge Michael Anderson of the FBI’s New Orleans Division, and Louisiana State Attorney General James D. “Buddy” Caldwell made the announcement.

Roslyn F. Dogan, 53, of Baton Rouge, Louisiana, and James R. Hunter, 48, of Houston, Texas, were sentenced by U.S. District Court Chief Judge Brian A. Jackson in the Middle District of Louisiana to 90 months in prison and 60 months in prison, respectively.  In addition to the prison sentences, Dogan was ordered to pay $43.5 million and Hunter was ordered to pay $3.2 million in restitution.

After six days of trial, on May 21, 2014, a federal jury found Dogan guilty of conspiracy to commit health care fraud, and two counts of health care fraud, and also found Hunter guilty of conspiracy to commit health care fraud and conspiracy to pay and receive kickbacks.

According to evidence presented at trial, Dogan was a co-owner of Serenity Center of Baton Rouge, and a manager and marketer for both Serenity Center and Shifa Community Mental Health Center of Baton Rouge.  Dogan recruited Medicare beneficiaries who were living in nursing homes and assisted living facilities to attend the PHP programs at Shifa and Serenity, knowing the individuals did not need the psychotherapy programs.  She then devised methods to keep the patients at the facilities for as long as possible without invoking scrutiny from Medicare, including by having patients involuntarily committed to local inpatient psychiatric hospitals and then discharged and re-admitted to one of the Shifa facilities.  Additionally, Dogan directed administrators and therapists at the Shifa Baton Rouge facilities to falsify treatment records indicating that patients had received psychotherapy treatment when, in fact, the patients had not received such treatment.  She further concealed the fraud by directing that patient billing statements be intercepted from the mail to prevent the patients from seeing the services that had been billed in their names, and by stealing incriminating documents seized pursuant to a search warrant from federal custody.

Evidence at trial demonstrated that Hunter agreed to recruit Medicare beneficiaries to attend the PHP program at Shifa Community Mental Health Center of Texas in Houston in exchange for $1,500 per week in cash.  Hunter recruited Medicare recipients from group homes who were not appropriate for the PHP services, but who agreed to attend the program in exchange for $75 cash per week.  To ensure their admittance to the program, Hunter instructed each beneficiary as what to say to physicians regarding their supposed psychiatric symptoms.  As a result of the kickback scheme with Hunter, the Houston facility billed Medicare approximately $16.5 million.

According to court documents, the investigation into the three community mental health centers has resulted in the conviction of seventeen individuals, including therapists, marketers, administrators, owners and a medical director.  The companies collectively submitted more than $258 million in claims to Medicare for PHP services over a period of seven years.  Medicare paid approximately $43.5 million on those claims.

The case is being investigated by HHS-OIG, the FBI, and the Medicaid Fraud Control Unit of the Louisiana Attorney General’s Office, and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Middle District of Louisiana.  The case is being prosecuted by Trial Attorneys Abigail Taylor and Dustin M. Davis of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Shubhra Shivpuri of the Middle District of Louisiana.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.

A Memphis man pleaded guilty yesterday to the sex trafficking of a 16 year-old girl, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Edward L. Stanton III of the Western District of Tennessee and Special Agent in Charge Todd McCall of the FBI’s Memphis Division.                     

During his plea hearing, Laron Matlock, 33, of Memphis, admitted that he purchased a bus ticket for a 16-year-old girl to travel from Chicago to Memphis on July 28, 2012, for the purpose of engaging in prostitution.  Matlock further admitted to transporting the victim from Memphis to Nashville for the purpose of prostitution.  Matlock was arrested on Aug. 1, 2012, after he returned to Memphis with the victim and attempted to take her to a customer’s house for the purpose of prostitution.

Sentencing is scheduled for Jan. 30, 2015, before U.S. District Judge Jon Phipps McCalla of the Western District of Tennessee.                               

This case was investigated by the Civil Rights Human Trafficking Taskforce, the FBI’s Memphis Division and the Shelby County Sheriff’s Department.  This case is being prosecuted by Trial Attorney Mi Yung Park of the Criminal Division’s Child Exploitation and Obscenity Section and Assistant U.S. Attorney Brian K. Coleman of the Western District of Tennessee. 

The Justice Department today announced it has reached a comprehensive settlement agreement with the city of Albuquerque that will bring wide-ranging reforms to the Albuquerque Police Department (APD) and its use of force against civilians.  The Justice Department and the city have agreed to enter into a court-enforceable settlement agreement that will overhaul the way in which APD handles use of force by its officers following a year-long investigation into the department’s practices and letter of findings released by the Justice Department in April 2014.  Once the Albuquerque City Council considers the settlement agreement in a special session scheduled for the week of Nov. 3, the Justice Department and the city will file the settlement agreement with the United States District Court for approval and entry as an order.

"The overwhelming majority of our nation’s law enforcement officials perform their duties with exceptional courage, integrity, and professionalism—risking their lives every day to keep their communities safe,” said Attorney General Eric H. Holder Jr.  “But whenever a pattern of troubling conduct is uncovered, or that high standard is not met, the Department of Justice must and will take action.  The far-reaching agreement we have secured in this case will transform the culture and practices of the Albuquerque Police Department.  And I am confident that, with the cooperation of city leaders and brave law enforcement officials, we will take significant steps to restore trust with local citizens and build for Albuquerque’s residents the stronger, safer, and more secure communities that all Americans deserve.“

In addition to use of force practices, The Justice Department’s investigation found that officers routinely use deadly force and less lethal force in an unreasonable manner and that systemic deficiencies in policies, training, supervision, and oversight contributed to the pattern or practice.  Following the release of the investigative findings, the Justice Department engaged in extensive community outreach to solicit feedback and recommendations on reform from a wide variety of stakeholders, including police officers, community leaders, mental health advocates, family members, and other Albuquerque residents.  The feedback played a critical role in tailoring the settlement agreement to the unique needs of the Albuquerque community and APD. 

“Today’s landmark settlement agreement will begin the process of restoring trust and cooperation between the Albuquerque community and law enforcement,” said Vanita Gupta, Acting Assistant Attorney General for the Civil Rights Division.  “Constitutional policing is key to building trust between police departments and the communities they serve, and trust is of course key to ensuring public and officer safety.  The settlement agreement provides a blue print for sustainable reform that will foster continued collaboration and participation from the community.  We thank Mayor Berry, Chief Eden, and all of the individuals who came forward to share their experiences concerning APD to make this historic settlement agreement possible.”

“We are extremely proud of our community and police department for coming together in a time of serious challenges to the city to offer their advice and recommendations on a path forward,” said Damon P. Martinez, United States Attorney for the District of New Mexico.  “Reform will not take place overnight and it will take time to heal our community, but we are well on our way.  Through the settlement agreement reached today, the city agrees to implement fundamental reforms in a transparent manner that will ensure that force is used in accordance with constitutional rights and that promotes greater trust among the hard working men and women of the Albuquerque Police Department and the residents they are sworn to protect.”

Under the settlement agreement, the city and APD will implement comprehensive reforms in nine substantive areas.  An independent monitoring team will be selected jointly and will oversee the reforms, which are expected to be implemented within four years.  The areas covered by the settlement agreement are:

• Use of force: including requiring supervisors to report to the scene of uses of force; providing medical care to subjects of force immediately after an incident; improving the quality of force investigations; developing a force review board to detect and correct patterns and trends, and utilizing surrounding law enforcement agencies as part of a multi-agency task force to investigate officer-involves shootings to provide greater objectivity and accountability;

• Specialized units: including measures that require clearly defined missions and duties for specialized tactical and investigative units; ensuring that officers are sufficiently trained to save lives in high-risk situations; and dismantling APD’s repeat offender project to restore its core mission as an investigative, rather than tactical, unit;

• Crisis intervention: including establishing a mental health response advisory committee; providing behavioral health training to all officers, police dispatchers, and 9-1-1 operators; and maintaining groups of specially-trained first responders, detectives, and mental health professionals that provide crisis intervention and ongoing support to individuals with serious mental illness or who are chronically homeless;

• Policies and training: including developing clear and comprehensive policies on use of force, preventing retaliation, supporting officers who report misconduct, and improving the field training program to ensure that officers develop the necessary technical and practical skills required to use force in a lawful and effective manner;

• Internal and civilian complaint investigations: including measures to eliminate arbitrary deadlines for the submission of civilian complaints; standards for conducting objective, thorough, and timely investigations; steps to ensure that the disciplinary system is fair and consistent; and protocols to protect officers’ rights against self-incrimination;

• Staffing and supervision: including completing a staffing and resource study to determine the appropriate allocation of resources; holding supervisors accountable for close and effective supervision; and providing guidance on the effective use of on-body recording systems to promote accountability and strengthen public trust;

• Recruitment and promotions: including developing a strategic recruitment plan that includes clear goals, objectives, and action steps for attracting qualified applicants from a broad cross section of the community and ensuring that fair and consistent promotion practices are implemented;

• Officer assistance and support: including measures to ensure that APD personnel have ready access to mental health services and that supervisors are trained in making referrals in a manner that minimizes stigma; and

• Community engagement and oversight: including measures to strengthen the city’s civilian oversight process; public information programs that keep members of the public informed of APD’s progress toward reform; requirements on fostering community policing at all levels of APD; and establishing community policing councils throughout the city to ensure that meaningful feedback is obtained from the community.

The independent monitoring team will oversee the implementation of reforms, provide technical assistance, and report on the city’s compliance through periodic and public reports.  The monitoring team will have access to all documents, personnel, facilities and information related to the settlement agreement and will engage with officers and community members on an ongoing basis.  The monitoring team will also be responsible for conducting outcome assessments to determine whether the goals of the settlement agreement are being met through compliance indicators and objective measures.  The settlement agreement requires two years of sustained compliance with the agreement before the agreement may be terminated. 

For more information on the Justice Department’s Civil Rights Division, please visit www.justice.gov/crt.  For more information about the United States Attorney’s Office for the District of New Mexico, please visit http://www.justice.gov/usao/nm. 

APD Commitment Letter
DOJ-ABQ Agreement Fact Sheet
DOJ-ABQ Settlement Agreement
SPL Police Accomplishments
 

The Department of Justice announced today the filing of a complaint in U.S. District Court for the District of Arizona against Pima Community College (PCC) in Tucson, Arizona, for violating the employment rights of Army National Guardsman Timothy Stoner under the Uniformed Services Employment and Reemployment Rights Act (USERRA). 

The department’s complaint alleges that Pima Community College violated USERRA by failing to promote Stoner to the position of police corporal in 2010 and again in 2013. USERRA prohibits employment discrimination based on a service member’s past, current or future military status, service or obligation.  Stoner, a PCC police officer, is a veteran of active duty military deployments in Afghanistan and Iraq.  He is currently a Sergeant First Class in the Army National Guard with 21 years of total military service, including three years on active duty.

According to the department’s complaint, PCC created the supervisory position of police corporal in 2010.  Prior to that position being created, Stoner effectively performed his assigned duties as a lead police officer, an assignment that was replaced by the creation of the police corporal position.  In 2010 and 2013, Stoner applied for promotion to police corporal, but both times he was not selected.  The lawsuit alleges that, in each of the two years, Stoner’s military service was a motivating factor in PCC’s decision to deny him promotion to police corporal.  According to the lawsuit, for both promotions, one of the two PCC officials who made the decision not to select Stoner exhibited anti-military bias against Stoner that was directly related to his military obligations.  According to the suit, PCC conducted an investigation of Stoner’s internal complaint that his denial of promotion in 2013 was the result of anti-military bias by PCC selecting officials, and the college found that his complaint was substantiated.  As a result, the PCC investigator recommended that remedial action be taken, including placing Stoner in an acting corporal position.  

The department’s lawsuit seeks remedial relief for Stoner for the USERRA violations in 2013, as well as an earlier violation of the statute in 2010.  The suit also alleges that PCC’s demonstration of anti-military bias was willful and warrants the award of liquidated damages to Stoner, as well as compensation for his loss of earnings and other benefits of employment. 

 “Employers have a legal obligation to respect and honor the rights of our uniformed service members to be fairly considered for promotions and other employment opportunities and not to subject them to unlawful discrimination because of their service in defense of our country,” said Acting Assistant Attorney General Vanita Gupta for the Civil Rights Division.

Stoner initially filed a complaint with the Labor Department’s Veterans’ Employment and Training Service, which investigated this matter and, after resolution failed, referred it to the Justice Department.  The Department’s Civil Rights Division, through its Employment Litigation Section, then filed suit on Stoner’s behalf.  The Civil Rights Division has given a high priority to the enforcement of service members’ rights under USERRA.  Additional information about USERRA can be found on the Justice Department’s Web sites at http://www.usdoj.gov/crt/emp and http://www.servicemembers.gov, as well as on the Labor Department’s website at http://www.dol.gov/vets/programs/userra/main.htm.

Stoner v. Pima Community College Complaint

Hitachi Metals Ltd., an automotive parts manufacturer based in Tokyo, Japan, and successor in interest to Hitachi Cable Ltd. (collectively Hitachi), has agreed to plead guilty and to pay a $1.25 million criminal fine for its role in a conspiracy to fix prices and rig bids for automotive brake hose installed in cars sold in the United States and elsewhere, the Department of Justice announced today. 

According to the one-count felony charge filed today in the U.S. District Court for the Northern District of Ohio in Toledo, Hitachi conspired to fix the prices of automotive brake hose sold to Toyota Motor Corporation and certain of its subsidiaries, affiliates and suppliers, in the United States and elsewhere (collectively Toyota).  In addition to the criminal fine, Hitachi has agreed to cooperate in the department’s ongoing investigation.  The plea agreement will be subject to court approval.

“Today’s guilty plea demonstrates the Antitrust Division’s commitment to hold companies accountable for engaging in illegal anticompetitive conduct,” said Brent Snyder, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program.  “The division is dedicated to its mission to protect U.S. consumers and businesses.”

According to the charge, Hitachi and its co–conspirators conspired through meetings and conversations in which they discussed and agreed upon bids and price quotations to be submitted to Toyota, and to allocate the supply of automotive brake hose to Toyota.  In furtherance of the agreement, Hitachi sold automotive brake hose at non–competitive prices to Toyota in the United States and elsewhere.  Hitachi’s involvement in the automotive brake hose conspiracy lasted from at least as early as November 2005 until at least September 2009.

Hitachi manufactures and sells a variety of automotive parts, including automotive brake hoses, which are flexible hoses that carry brake fluid through the hydraulic brake system of automobiles.  The charges against Hitachi are the latest in the department’s on-going investigation into anticompetitive conduct in the automotive parts industry.  These are the first charges filed relating to automotive brake hose sold to automobile manufacturers.

To date, 44 individuals have been charged in the government’s ongoing investigation into price fixing and bid rigging in the auto parts industry.  Including Hitachi, 30 companies have pleaded guilty or agreed to plead guilty and have agreed to pay a total of nearly $2.4 billion in fines.

Hitachi is charged with price fixing and bid rigging in violation of the Sherman Act, which carries a maximum penalty for corporations of a $100 million criminal fine for each violation.  The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Today’s charge is the result of an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by the Antitrust Division’s criminal enforcement sections and the FBI.  Today’s charge was brought by the Antitrust Division’s Chicago Office and the FBI’s Cleveland Field Office, Lima Resident Agency, with the assistance of the FBI headquarters’ International Corruption Unit and the U.S. Attorney’s Office for the Northern District of Ohio.  Anyone with information on price fixing, bid rigging and other anticompetitive conduct related to other products in the automotive parts industry should contact the Antitrust Division’s Citizen Complaint Center at 1-888-647–3258, visit www.justice.gov/atr/contact/newcase.html or call the FBI’s Cleveland Field Office at 216-522-1400.

Hitachi Information

El Departamento de Justicia anunció hoy que ha logrado un acuerdo de resolución detallado con la Ciudad de Albuquerque, el cual traerá amplias reformas al Departamento de Policía de Albuquerque (“APD” sus siglas en inglés) y su uso de fuerza contra civiles.  Tras un año de investigaciones del uso de fuerza por parte de oficiales del APD y la publicación de la carta de hallazgos en abril, 2014,  El Departamento de Justicia y la Ciudad han acordado entrar en un acuerdo ejecutable ante los tribunales el cual cambiará la manera en que oficiales del APD usan fuerza.  Una vez que el Consejo de la Ciudad de Albuquerque considere el acuerdo de resolución en una sesión especial programada para la semana del 3 de noviembre, el Departamento de Justicia y la Ciudad presentarán el acuerdo de resolución ante el Tribunal de Distrito de los Estados Unidos para su aprobación e introducción como una ordenanza.

“La gran mayoría de los oficiales de policía de nuestra nación llevan a cabo sus labores con valor, integridad y profesionalismo excepcionales-arriesgando su vida a diario para mantener sus comunidades seguras.  Pero cuando un patrón preocupante de mala conducta es revelada, o no se cumple con los estándares, el Departamento de Justicia tiene que tomar acción”, dijo el Procurador General Eric H. Holder Jr.  “El acuerdo de amplio alcance que hemos logrado en este caso, transformará la cultura y las prácticas del Departamento de Policía de Albuquerque.  Y confío que, con la cooperación de los líderes de la ciudad y los valientes oficiales de la policía, tomaremos pasos importantes para restaurar la confianza de los ciudadanos locales y construiremos para los residentes de Albuquerque comunidades más fuertes y seguras que es lo que todos los americanos se merecen”.

Además del uso de prácticas de fuerza, la investigación del Departamento de Justicia encontró que los oficiales utilizan fuerza mortal y fuerza menos letal de manera irrazonable y que deficiencias sistémicas en políticas, entrenamiento y supervisión han contribuido al este patrón o práctica.  Después de la publicación de los hallazgos investigativos, el Departamento de Justicia solicitó información y recomendaciones para la reforma de la comunidad;  así como de una variedad de interesados, incluyendo oficiales de policía, líderes comunitarios, defensores de salud mental y de otros residentes de Albuquerque.  La información recibida tuvo un papel significante en la creación del acuerdo de resolución para que fuera algo positivo para las necesidades de la comunidad de Albuquerque y del APD.

“Este acuerdo de resolución sin precedentes, comenzará el proceso de restaurar confianza y cooperación entre la comunidad de Albuquerque y los oficiales de policía.  Prácticas policiales constitucionales son la clave para construir confianza entre los departamentos de policía y las comunidades a las cuales sirven y por supuesto, la confianza es clave para asegurar la seguridad del público y de los oficiales”, dijo Vanita Gupta, Procuradora General Asistente Interina de la División de Derechos Civiles.  “Este acuerdo de resolución provee el modelo para una reforma  sostenible que proporcionará una colaboración y participación continua por parte de la comunidad.  Agradecemos al Alcalde Berry, al Jefe de Policía Eden y a todos los individuos que compartieron con nosotros sus experiencias referentes al APD, para que este histórico acuerdo de resolución fuera una realidad”.

“Estamos verdaderamente orgullosos de nuestra comunidad y de nuestro departamento de policía por haber trabajado juntos durante un tiempo cuando la Ciudad enfrentaba serios desafíos, y ofrecer sus consejos y recomendaciones para seguir adelante,” dijo Damon P. Martínez, Procurador Federal por el Distrito de Nuevo México.  “La reforma no pasará de la noche a la mañana y tomará tiempo para que nuestra comunidad sane, pero ya estamos en camino.  A través del acuerdo de resolución que se logró hoy, la Ciudad está de acuerdo en implementar reformas fundamentales de una manera transparente, las cuales asegurarán que la fuerza será usada de acuerdo a derechos constitucionales y que generará más confianza entre los dedicados hombres y mujeres del Departamento de Policía de Albuquerque y los residentes a quien han jurado proteger”. 

Bajo el acuerdo de resolución, la Ciudad y el APD implementarán reformas detalladas en nueve áreas sustantivas.  Un equipo de monitoreo independiente será seleccionado conjuntamente y supervisará las reformas las cuales se espera será implementadas durante los próximos cuatro años.  Las áreas que cubre el acuerdo de resolución son:

• Uso de fuerza:  incluirá que los supervisores acudan a la escena dónde se usó fuerza; proveer cuidados médicos a los sujetos, objetos de la fuerza, inmediatamente después del incidente; mejorar la calidad de las investigaciones del uso de fuerza; desarrollar un comité de revisión del uso de fuerza para detectar y corregir patrones y tendencias, utilizando agencias de policías circundantes como parte de un equipo poli-agencia que investigará tiroteos que involucren a oficiales de la policía  para así obtener mayor objetividad y sentido de responsabilidad. 

• Unidades especializadas:  incluyendo medidas que requieran de trabajos y deberes bien definidos para las unidades tácticas especializadas y de investigación; asegurarse que los oficiales estén suficientemente entrenados para salvar vidas en situaciones de alto riesgo; y el desmantelamiento del proyecto de reincidentes del APD, y así restaurar su misión esencial investigativa en lugar de unidad táctica.

• Intervención en situaciones de crisis:  incluyendo el establecimiento de un comité asesor de salud mental; proveer entrenamiento sobre la salud del comportamiento a todos los oficiales, despachadores y operadores del 911; y mantener grupos especialmente entrenados de proveedores de primeros auxilios, detectives y profesionales de salud mental, los cuales proveerán intervención en situaciones de crisis y darán apoyo a individuos con enfermedad mental grave o que están crónicamente sin hogar. 

• Políticas y entrenamiento:  incluyendo el desarrollo de políticas claras y detalladas sobre el uso de fuerza, prevención de represalias, apoyo a oficiales que reportan la mala conducta y mejorar el programa de entrenamiento para asegurar que los oficiales desarrollen la habilidades técnicas y prácticas requeridas para usar fuerza de una manera legal y efectiva. 

• Investigaciones internas y a quejas de civiles:  incluyendo medidas para eliminar fechas límites arbitrariamente impuestas para la presentación de quejas por parte de civiles;  estándares para llevar a cabo investigaciones de manera objetiva, profunda y a tiempo;  medidas para asegurar que el sistema de disciplina sea justo y consistente; y protocolos para proteger los derechos de los oficiales contra la autoincriminación. 

• Personal y supervisión:  incluyendo un estudio de personal y recursos para determinar la distribución de recursos; hacer a los supervisores responsables de una supervisión cercana y efectiva;  y proveer orientación sobre los sistemas de grabación colocados en el cuerpo para promover responsabilidad y aumentar la confianza pública.

• Reclutamiento y promociones:  incluyendo el desarrollo de un plan de reclutamiento estratégico que incluya metas y objetivos bien definidos y tomar los pasos necesarios para atraer a solicitantes cualificados quienes vengan de todos los sectores de la comunidad y asegurar que prácticas de promoción sean justas y consistentes. 

• Asistencia y ayuda a oficiales:  incluyendo medidas para asegurar que personal del APD tenga acceso inmediato a servicios de salud mental y que supervisores estén entrenados para enviar a un especialista de tal manera que minimice el estigma; y

• Participación comunitaria y supervisión:  incluyendo medidas que refuercen el proceso de supervisión por parte de civiles de la Ciudad; programas de información pública que mantengan al público informado del progreso del APD hacía la reforma; requisitos para fomentar prácticas policiales comunitarias en todos los niveles del APD; y poner en sitio comités para establecer prácticas policiales comunitarias a lo largo de la ciudad para asegurar que se obtenga información significativa de la comunidad. 

Un equipo independiente de monitoreo supervisará la implementación de las reformas, dará asistencia técnica y reportará sobre el cumplimiento por parte de la ciudad a través

de reportes que se harán periódicamente y serán públicos.  El equipo de monitoreo tendrá acceso  a todos los documentos, personal, instalaciones e información relacionada con el acuerdo de resolución y se relacionará con oficiales y miembros de la comunidad continuamente.  El equipo de monitoreo también será responsable de asesorar los resultados para determinar si las metas del acuerdo de resolución se están cumpliendo.  Esto se hará a través de indicadores de cumplimento y medidas objetivas.  El acuerdo de resolución requiere dos años sostenidos de cumplimiento antes de que pueda ser finalizado.

Para más información sobre la División de Derechos Civiles, por favor visite www.justice.gov/crt.  Para más información sobre la Oficina del Procurador Federal por el Distrito de Nuevo México, por favor visite http://www.justice.gov/usao/nm.

APD Commitment Letter
DOJ-ABQ Agreement Fact Sheet
SPL Police Accomplishments
 

Two employees of a Costa Rica based telemarketing call center that defrauded thousands of victims of more than $4 million have been sentenced to serve 300 months in prison and 144 months in prison.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Anne M. Tompkins of the Western District of North Carolina made the announcement after U.S. District Judge Robert J. Conrad Jr. of the Western District of North Carolina imposed the sentences. 

On Oct. 30, 2014, Glen Adkins Jr., 43, of San Diego, California, was sentenced to serve 300 months in prison and Warren F. Tonsing Jr., 43, of St. Paul, Minnesota, was sentenced to serve 144 months in prison.  They were both ordered to pay $2.4 million in restitution, joint and several with their co-defendants.

Both defendants were convicted on Aug. 8, 2013, following a jury trial, of wire fraud and money laundering stemming from a scheme to defraud United States residents, most over the age of 55, out of millions of dollars by deceiving them into believing that each had won a large monetary prize in a “sweepstakes contest.”  According to evidence presented at trial, both defendants worked in a Costa Rica-based call center that used computers to make telephone calls over the Internet to victims in the United States.  This process allowed the defendants and their co-conspirators to disguise the originating location of the calls.  Victims were informed that the callers were from a Federal agency, such as the Federal Trade Commission, and that to receive their “prize” they had to wire thousands of dollars to Costa Rica for a purported “refundable insurance fee.”  As long as the victims continued to pay, the co-conspirators continued to solicit more money from them in the form of purported fees.

To date, 46 defendants have been convicted in the Western District of North Carolina for their participation in similar Costa Rican telemarketing schemes.

These cases were investigated by a multi-agency task force composed of the U.S. Postal Inspection Service, FBI, Internal Revenue Service, Federal Trade Commission and Department of Homeland Security.  These cases are being prosecuted by Senior Litigation Counsel Patrick M. Donley and Trial Attorneys William H. Bowne of the Criminal Division’s Fraud Section.

An Alabama real estate investor pleaded guilty yesterday for his role in a conspiracy to commit mail fraud related to public real estate foreclosure auctions held in southern Alabama, the Department of Justice announced today.  To date, 10 individuals and two companies have pleaded guilty in connection with the department’s ongoing investigation into bid rigging and fraudulent schemes in the Alabama real estate foreclosure auction industry.

Chad E. Foster, a resident of Theodore, Alabama, pleaded guilty yesterday to an indictment filed in the U.S. District Court for the Southern District of Alabama, charging him with one count of conspiracy to commit mail fraud affecting a financial institution.  According to court documents, Foster knowingly joined a conspiracy with others to, among other things, fraudulently acquire title to selected properties at artificially suppressed prices, to conduct secret, second auctions open only to members of the conspiracy, to make payoffs to and receive payoffs from co-conspirators, and to divert money away from financial institutions, homeowners and others with a legal interest in selected properties. 

“This guilty plea demonstrates the Antitrust Division’s resolve to pursue those who conspire to defraud distressed homeowners and financial institutions,” said Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division.  “The division will continue to hold accountable individuals who subvert the competitive process for their own gains.”

“We are committed to partnering with the Antitrust Division,” said FBI Special Agent in Charge Robert F. Lasky of the Mobile Field Office.  “And we will hold accountable those individuals who profited illegally at the expense of financial institutions and struggling homeowners.” 

The charge of conspiracy to commit mail fraud affecting a financial institution carries a maximum penalty of 30 years in prison and a $1 million fine.

Yesterday’s charge stems from an ongoing investigation being conducted by the Antitrust Division’s Washington Criminal II Section and the FBI’s Mobile Field Office, with the assistance of the U.S. Attorney’s Office for the Southern District of Alabama.  Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions in Alabama should call the Antitrust Division at 202-598-4000, or visit www.justice.gov/atr/contact/newcase.htm.

Yesterday’s charges were brought in connection with the President’s Financial Fraud Enforcement Task Force.  The task force was established 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’s 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.  Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants.  For more information on the task force, please visit www.StopFraud.gov.

Tamaica Hoskins and Roberta Pyatt, of Phenix City, Alabama, and Lashelia Alexander, of Columbus, Georgia, were indicted for their roles in a stolen identity refund fraud (SIRF) conspiracy, Acting Deputy Assistant Attorney General Larry J. Wszalek for the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama announced today following the unsealing of the indictment.

According to the indictment, in 2014, Hoskins and Pyatt obtained stolen identities and used those identities to file more than 1,000 federal income tax returns that claimed more than $4 million in tax refunds.  In order to carry out their fraud scheme, Hoskins and Pyatt opened up bank accounts in order to receive tax preparation fees.  In addition, Hoskins and Pyatt printed out fraudulent tax refunds using check stock provided by the financial institutions.  Hoskins, Pyatt and Alexander caused the fraudulent checks to be cashed at several businesses and banks. 

If convicted, the defendants face a statutory maximum potential sentence of 20 years in prison for the conspiracy to commit wire fraud count and for each wire fraud count, a statutory maximum sentence of 10 years in prison for each theft of public money count and a mandatory two-year sentence in prison for the aggravated identity theft counts.  The defendants are also subject to fines, forfeiture and mandatory restitution, if convicted.

The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation.  Trial Attorneys Michael Boteler and Gregory Bailey of the Tax Division and Assistant U.S. Attorney Todd Brown for the Middle District of Alabama are prosecuting the case.

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

In honor of the 20th anniversary of the Violence Against Women Act, the Department of Justice today announced a nationwide tour of Office on Violence Against Women (OVW) grant recipients.  The tour will engage with communities dedicated to ending violence against women though coordinated community response (CCR) teams.  OVW launched the tour today with a visit to programs in Brooklyn, New York.  OVW and department officials will visit diverse communities across the country through May 2015.  Officials will participate in roundtable conversations with local law enforcement, victim service providers, judges, prosecutors and other members of the coordinated community response team.

This tour is an important part of the department’s ongoing effort to prevent and address violence against women.  Officials will see how best practices are playing out across the nation – especially in areas such as prosecution, law enforcement, victim services, cultural competency, language access, prevention and public awareness.

“Research shows that efforts to address violence against women are particularly effective when they are combined and integrated into a coordinated community response,” said Principal Deputy Director Bea Hanson of the Office on Violence Against Women.  “We know that when police departments, courts, and victim service providers work together to create multi-disciplinary response teams, the quality of victim services and justice system responses are improved, which can influence and change the way communities understand and talk about violence against women.” 

Currently, OVW administers 24 grant programs, authorized by the Violence Against Women Act of 1994 and subsequent legislation, designed to develop the nation’s capacity to reduce domestic violence, dating violence, sexual assault and stalking by strengthening services to victims and holding offenders accountable. Since 1995, OVW has awarded more than $5.7 billion to address domestic violence, dating violence, sexual assault and stalking in communities across the country.

The planned national tour sites are: Brooklyn, NY; Oklahoma City, OK; Alameda County, CA; Contra Costa County, CA; Vermont; New Orleans, LA; San Diego, CA; Duluth, MN; Idaho; Maryland; Multnomah County, OR; San Francisco, CA.  Additional sites and tour participants will be announced at a future date.

Assistant Attorney General for National Security John Carlin, U.S. Attorney Ripley Rand for the Middle District of North Carolina and Special Agent in Charge John Strong of the FBI in North Carolina announced today that Donald Ray Morgan pleaded guilty to attempting to provide material support to a designated foreign terrorist organization and possession of firearm by a felon.

Morgan, 44, of Rowan County, North Carolina, pleaded guilty this morning before U.S. District Court Judge Thomas D. Schroeder.  Morgan was charged on Oct. 30, 2014, in a bill of information with attempted provision of material support to a foreign terrorist organization.  The offense is punishable by a maximum of fifteen years imprisonment and a $250,000 fine.

“Today’s plea represents our continued commitment to confronting those who attempt to travel abroad to support terrorist organizations,” said Assistant Attorney General Carlin.  “Preventing individuals from joining ISIL and holding accountable those who attempt to provide material support to the terrorist organization remains one of our highest priorities.”

“Today's plea is a sad reminder that those who wish to aid foreign terrorist organizations can come from any community and from any background,” stated U.S. Attorney Rand.  “We will continue to do everything we can to work effectively with our law enforcement partners and protect innocent people from terrorist activity, whether here in the United States or abroad.”

“Donald Ray Morgan proved himself to be a threat to national security,” said Special Agent in Charge Strong.  “He traveled overseas with intentions to join the violent terrorist group, ISIL in Syria.  American citizens who support terrorist organizations must be held accountable for their actions.”

According to court documents, Morgan knowingly attempted to provide support and resources beginning in January 2014 until on or about Aug. 2, 2014, including his own services, to al-Qa’ida in Iraq, also known as Islamic State of Iraq and the Levant (ISIL) and the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization.  On at least one occasion Morgan unsuccessfully attempted to travel from Lebanon to Syria to join ISIL/ISIS.  Morgan also frequently used social media and an interview with an American journalist to express his support for ISIL/ISIS and violent terrorist activities.

Morgan was initially arrested on Aug. 2, 2014, at JFK International Airport in New York City on a federal indictment for possession of a firearm by a felon.  The firearm offense occurred in January 2012.  Possession of a firearm by a felon is punishable by a maximum of ten years imprisonment a $250,000 fine.

Sentencing is set for Feb. 18, 2015.

edThe investigation was conducted by the FBI’s Charlotte Division, and Resident Agency Joint Terrorism Task Force (JTTF).  The Greensboro JTTF consists of the following agencies: FBI, Greensboro Police Department, Guilford County Sheriff’s Office, High Point Police Department and the Winston-Salem Police Department.  The prosecution is being handled by Assistant U.S. Attorney Graham Green with the assistance of the Counterterrorism Section of the Justice Department’s National Security Division.

The Department of Justice announced today that it will require Media General Inc. to divest WVTM-TV(NBC), located in the Birmingham, Alabama, Designated Market Area (DMA); WJCL-TV (ABC) and WTGS (FOX), both located in the Savannah, Georgia, DMA; WALA-TV (FOX), located in the Mobile, Alabama/Pensacola, Florida, DMA; WJAR-TV (NBC), located in the Providence, Rhode Island/New Bedford, Massachusetts, DMA; and WLUK-TV(FOX) and WCWF-TV (CW), both located in the Green Bay/Appleton, Wisconsin, DMA, in order to proceed with its acquisition of LIN Media LLC for $1.5 billion.  The department said that without the required divestitures, prices for broadcast television spot advertising would likely increase to advertisers in the DMAs. 

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

“Media General’s stations and LIN’s stations compete head-to-head in the sale of broadcast television spot advertising in several markets around the country, and this competition benefits advertisers and, ultimately, consumers,” said Bill Baer, Assistant Attorney General for the Antitrust Division.  “The divestitures required by the department will ensure that these stations remain vigorous competitors in their designated market areas.”

Under the terms of the proposed settlement, Media General and LIN must divest assets used in the operation of WVTM-TV and WJCL-TV to Hearst Television Inc.; WALA-TV to Meredith Corporation; and WJAR-TV, WLUK-TV, WCWF-TV, and WTGS to Sinclair Broadcast Group Inc., or to other acquirers approved by the United States.

Media General, a Virginia corporation with its headquarters in Richmond, Virginia, owns and operates 31 broadcast television stations in 29 metropolitan areas, including broadcast television stations in each of the DMA Markets. 

LIN, a Delaware corporation with its headquarters in Austin, Texas, owns and operates, or provides programming, operating, or sales services to more than 50 stations in 23 metropolitan areas, including broadcast television stations in each of the DMA Markets.

As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register.  Any person may submit written comments concerning the proposed settlement during a 60‑day comment period to David C. Kully, Chief, Litigation III Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 4000, Washington, DC 20530.  At the conclusion of the 60‑day comment period, the U.S. District Court for the District of Columbia may approve the proposed settlement upon finding that it is in the public interest.

Dignity Health has agreed to pay the United States $37 million to settle allegations that 13 of its hospitals in California, Nevada and Arizona knowingly submitted false claims to Medicare and TRICARE by admitting patients who could have been treated on a less costly, outpatient basis, the Justice Department announced today.  Dignity, formerly known as Catholic Healthcare West, is based in San Francisco and is one of the five largest hospital systems in the nation with 39 hospitals in three states.

“Charging the government for higher cost inpatient services that patients do not need wastes the country’s vital health care dollars,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division.  “This department will continue its work to stop abuses of the nation’s health care resources and to ensure patients receive the most appropriate care.”

The settlement resolves allegations that 13 Dignity Health hospitals knowingly overcharged Medicare and TRICARE, part of the military health care program, for inpatient services for patients who should have been treated on a less costly, outpatient basis.  Because hospitals generally receive significantly higher payments from federal health care programs for inpatient admissions as opposed to outpatient treatment, the admission of numerous patients who do not need inpatient care, as alleged here, can result in substantial financial harm to federal health care programs.  

The United States alleged that from 2006 through 2010, 13 Dignity hospitals billed Medicare and TRICARE for inpatient care for certain patients who underwent elective cardiovascular procedures (e.g., stents, pacemakers) in scheduled surgeries when the claims should have been billed as outpatient surgeries.  In addition, the government alleged that from 2000 through 2008, four of the hospitals billed Medicare for beneficiaries undergoing elective kyphoplasty procedures, which are minimally-invasive and performed to treat certain spinal compression fractures that should have been billed as less costly outpatient procedures.  Lastly, the government alleged that from 2006 through 2010, 13 hospitals admitted patients for certain common medical diagnoses where admission as an inpatient was medically unnecessary and appropriate care could have been provided in a less costly outpatient or observation setting.   

“This settlement demonstrates this office’s commitment to protecting our federal health care programs,” said U.S. Attorney Melinda Haag for the Northern District of California.  “We will continue to aggressively and appropriately pursue False Claims Act allegations of wrongdoing in the health care industry.”

As part of today’s agreement, Dignity entered into a corporate integrity agreement with the U.S. Department of Health and Human Services – Office of Inspector General (HHS-OIG) requiring the company to engage in significant compliance efforts over the next five years.  Under the agreement, Dignity is required to retain independent review organizations to review the accuracy of the company’s claims for services furnished to federal health care program beneficiaries.

“Hospitals that attempt to boost profits by admitting patients for expensive and unnecessary inpatient hospital stays will be held accountable,” said Special Agent in Charge Ivan Negroni of HHS-OIG’s San Francisco Office.  “Both patients and taxpayers deserve to have medical decisions made solely on what is best for the patient based on medical necessity.”

This settlement resolves a lawsuit filed in the U.S. District Court for the Northern District of California by Kathleen Hawkins, a former employee of Dignity, under the qui tam or whistleblower provisions of the False Claims Act, which permit private citizens to bring lawsuits on behalf of the United States and obtain a portion of the government’s recovery.  Hawkins will receive approximately $6.25 million.

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 $23 billion through False Claims Act cases, with more than $14.8 billion of that amount recovered in cases involving fraud against federal health care programs.

The settlement was a result of a coordinated effort by the Civil Division, the U.S. Attorneys’ Offices for the Northern District of California and the Western District of New York and the HHS-OIG.

The case is captioned United States ex rel. Hawkins v. Catholic Healthcare West, et al., CV C 09-5604 JCS.  The claims resolved by this settlement are allegations only and there has been no determination of liability.

A man from Sandy, Utah, pleaded guilty today to one count of tax evasion, five counts of filing false claims for income tax refunds and three counts of filing fictitious obligations, the Justice Department and Internal Revenue Service (IRS) announced. 

Paul Ben Zaccardi, who was charged by superseding indictment on Jan. 8, was released following his guilty plea and is scheduled to be sentenced on March 11, 2015, before U.S. District Judge Tena Campbell.

According to the superseding indictment, in April 2004, Zaccardi embarked on a scheme to evade the payment of his income taxes.  As part of that scheme, Zaccardi re-titled his residence so that it was not in his name and caused his business receipts to be deposited into his wife’s account.

Zaccardi also presented five separate tax returns to the IRS claiming bogus refunds totaling $1,510,251.  In addition, from June 2008 to October 2011, Zaccardi presented three false and fictitious financial instruments to the IRS, the U.S. Treasury and the U.S. District Court for the District of Utah for a combined total of $6.05 million for the purported payment of his federal income tax liabilities. 

Zaccardi faces a statutory maximum sentence of 25 years in prison for each conviction of submitting fictitious obligations to the United States, a statutory maximum sentence of five years in prison for each conviction of presenting false, fictitious and fraudulent claims to the United States and a statutory maximum sentence of five years in prison for the tax evasion conviction.

This case was investigated by IRS-Criminal Investigation and prosecuted by Trial Attorneys Stuart Wexler and Ryan Raybould of the Justice Department’s Tax Division.

Superior Crude Gathering Inc. (Superior Crude) has agreed to pay a civil penalty for alleged violations of the Clean Water Act stemming from a 2010 crude oil spill from tanks at Superior’s oil storage facility in Ingleside, Texas, the Department of Justice and the Environmental Protection Agency (EPA) announced today.  Under the consent decree lodged today in federal court, Superior will pay $1.61 million to resolve the government’s claims.

The United States’ complaint, which was also filed today in the U.S. District Court for the Southern District of Texas, alleges that Superior discharged at least 2,200 barrels (or 92,400 gallons) of crude oil in violation of Section 311 of the Clean Water Act.  The oil discharged from two tanks at the facility on Feb. 9 and 10, 2010, and crude oil flowed into an unnamed lake and wetlands near the Intracoastal Waterway and Redfish Bay.  The complaint also includes related violations of the Clean Water Act’s spill prevention, control, and countermeasure regulations and spill response plan regulations. 

The $1.61 million penalty is in addition to the costs incurred by Superior Crude to respond to the oil spill and to repair the tanks and containment areas.  Superior Crude has ceased operations at the facility, which is located within the former Falcon Refinery.

“Operators have a responsibility to prevent oil spills and protect the public and the environment through vigilance and preparation,” said Acting Assistant Attorney General Sam Hirsch for the Justice Department’s Environment and Natural Resources Division.  “This settlement underscores the consequences of failing to meet that responsibility.”

“Water resources are precious, especially in Texas,” said EPA Regional Administrator Ron Curry.  “We rely on businesses to be effective partners in protecting these resources, and to take responsibility when their operations harm the environment.”

The Clean Water Act makes it unlawful to discharge oil or hazardous substances into or upon the navigable waters of the United States or adjoining shorelines in quantities that may be harmful to the environment or public health.  The penalty paid for this spill will be deposited in the federal Oil Spill Liability Trust Fund managed by the National Pollution Fund Center.  The Oil Spill Liability Trust Fund is used to pay for federal response activities and to compensate for damages when there is a discharge or substantial threat of discharge of oil or hazardous substances to waters of the United States or adjoining shorelines.

The proposed consent decree, lodged in the Southern District of Texas, is subject to a 30-day public comment period and court review and approval.  A copy of the consent decree is available on the Department of Justice website.

A Texas electronics business was ordered today to forfeit more than $1.3 million for failing to report that amount in cash transactions to the IRS, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division.

D-Tronics, a McAllen, Texas, electronics business, was sentenced today by U.S. District Judge Micaela Alvarez of the Southern District of Texas for failing to file an IRS Form 8300 corresponding to a cash transaction of more than $10,000.  In addition, in accordance with its plea agreement, D-Tronics will forfeit more than $1.350 million, which represents the amount of unreported currency.  The forfeiture is among the highest against a trade or business for violating the Form 8300 filing requirement.  A Form 8300 filing is required to be filed when anyone engaged in trade or business receives more than $10,000 in U.S. currency in one or two or more related sales transactions.

In addition, Pedro Diaz, 45, the owner of D-Tronics, was sentenced to one year of probation for failing to supply information concerning foreign bank accounts in which he had an interest.  Both Diaz and D-Tronics entered guilty pleas in July 2014.

The case was investigated by the Internal Revenue Service – Criminal Investigation and prosecuted by Trial Attorney Keith Liddle in the Money Laundering and Bank Integrity Unit of the Criminal Division’s Asset Forfeiture and Money Laundering Section. 

North Florida Shipyards and its president, Matt Self, will pay the United States $1 million to resolve allegations that they violated the False Claims Act by creating a front company, Ind-Mar Services Inc., in order to be awarded Coast Guard contracts that were designated for Service Disabled Veteran Owned Small Businesses (SDVOSBs), the Justice Department announced today.  North Florida Shipyards has facilities in Jacksonville, Florida.

“Those who expect to do business with the government must do so fairly and honestly,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division.  “We will not tolerate contractors who seek to profit at the expense of our veterans and taxpayers.”

To qualify as a SDVOSB on Coast Guard ship repair contracts, a company must be operated and managed by service disabled veterans and must perform at least 51 percent of the labor.  The government alleged that North Florida created Ind-Mar merely as a contracting vehicle and that North Florida performed all the work and received all the profits.  The government further alleged that if the Coast Guard and the Small Business Administration (SBA) had known that Ind-Mar was nothing but a front company, the Coast Guard would not have awarded it contracts to repair five ships.

In December 2013, the SBA suspended North Florida, Matt Self, Ind-Mar and three others from all government contracting.  In April 2014, North Florida and Matt Self entered into an administrative agreement with the SBA in which they admitted to having created and operated Ind-Mar in violation of its Coast Guard contracts and SBA statutes and regulations. 

“Special programs to assist service disabled veterans are an important part of the SBA’s business development initiative,” said U.S. Attorney A. Lee Bentley III for the Middle District of Florida.  “False claims such as this undermine the integrity of this vital program and, where found, will be vigorously pursued by our Office.”

“This settlement sends a strong message to those driven by greed to fraudulently obtain access to contracting opportunities set-aside for deserving small businesses owned and operated by service disabled veterans,” said Inspector General Peggy E. Gustafson for the SBA.  “We are committed to helping ensure that only eligible service disabled veteran owned small businesses benefit from that SBA program.”

The settlement resolves allegations originally filed in a lawsuit by Robert Hallstein and Earle Yerger 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.  Hallstein and Yerger will receive $180,000.

The investigation was a coordinated effort by the Civil Division, the U.S. Attorney’s Office for the Middle District of Florida, the Department of Homeland Security’s-Office of Inspector General and the SBA Office of Inspector General. 

The claims resolved by the settlement are allegations only, except to the extent that North Florida and Matt Self have admitted to the conduct in their agreement with the SBA.    

The case is captioned United States ex rel. Yerger, et al, v. North Florida Shipyards, et al., Case No. 3:11-cv-464J-32 MCR (M.D. Fla.). 

A member of the MS-13 gang has been sentenced to life in prison for his role in a gang-related murder and the attempted murder of two rival gang members in the Atlanta metropolitan area. 

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Sally Quillian Yates of the Northern District of Georgia, Special Agent in Charge Brock D. Nicholson of Immigration and Customs Enforcement’s Homeland Security Investigations’ (ICE HSI) Atlanta Office and Special Agent in Charge J. Britt Johnson of the FBI’s Atlanta Field Office made the announcement.

Remberto Argueta, aka Pitufo, 27, of Lilburn, Georgia was sentenced to life in prison in the Northern District of Georgia.  Argueta was convicted of related charges on Nov. 22, 2013, following a three-week jury trial, of RICO conspiracy, violent crime in aid of racketeering and using a firearm to commit a crime of violence in connection with the murder of a suspected drug dealer and attempted murder of two rival gang members.  Twenty-two additional defendants have been convicted of related charges as part of this case.

“Nearly two dozen MS-13 members have been convicted as a part of this investigation, wiping out the leaders and top members of an international street gang that spread violence and fear throughout the Atlanta area,” said Assistant Attorney General Caldwell.  “Sentences like the one handed down today help us to put MS-13 out of business in Atlanta and throughout the United States.”

“Argueta helped MS-13 live up to its reputation as a ruthless, violent gang that spread fear throughout the community,” said U.S. Attorney Yates. “He displayed a callous disregard for human life and has fittingly earned his place behind prison walls for the remainder of his life.”

“The world will be a safer place with this defendant behind bars for the rest of his life,” said Special Agent in Charge Nicholson.  “HSI is strongly committed to working with our partners at the FBI and local law enforcement agencies to identify and arrest the dangerous transnational gang members victimizing our communities.”    

“This sentencing of a hardened MS-13 gang member is one of a series of convictions and sentences of members of this gang known for their violence in the northern metro Atlanta area,” said Special Agent in Charge Johnson.  “While these dangerous gang members have now been neutralized, the FBI will continue to dedicate substantial investigative resources in this area to ensure that the void now created will not be filled by additional gang members or other gangs.”

According to evidence presented at trial, MS-13 is an international gang that has operated in the Atlanta area since at least 2005.  The gang members claimed Gwinnett and DeKalb Counties as their home territory and used violence to defend their territory.  They attacked rival gang members and committed armed robberies in furtherance of the MS-13 gang.

The evidence presented at trial showed that Argueta and other members of MS-13 planned to rob a suspected drug dealer at a hotel in April 2007.  During the attempted robbery, Argueta and his fellow MS-13 members killed the suspected drug dealer, who was also armed, in a shootout.  Hotel surveillance video showed one of the MS-13 members stopping to pick up the victim’s gun, which he later showed off as a trophy. 

Additional evidence showed that in October 2007, Argueta and several other MS-13 members were at an apartment complex in Gwinnett County when Argueta spotted suspected rival gang members.  He approached them and asked them who they “claimed” – that is, what gang they belonged to – and two of the rival gang members responded that they were members of the 18th Street gang.  Argueta replied, “You’re going to die,” pulled out a handgun and started chasing and shooting at the rival gang members.  During the pursuit, he shot one rival in the back and one in the hip and arm.  Argueta fired several rounds during the pursuit, some of which went into the apartments of nearby residents.  An elderly woman testified that one of Argueta’s bullets hit the headrest of an armchair that she had been sitting in just a few minutes earlier.

This case was investigated by ICE HSI and the FBI with assistance from the DeKalb County Police Department, Gwinnett County Police Department, and Gwinnett County Sheriff’s Office.

The case is being prosecuted by Trial Attorney Joseph K. Wheatley of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorney Paul R. Jones of the Northern District of Georgia.

A former Trooper with the Ohio State Highway Patrol pleaded guilty today in Columbus, Ohio, to four counts of violating the civil rights of female motorists and one count of engaging in cyber stalking.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, United States Attorney Carter M. Stewart of the Southern District of Ohio, Special Agent in Charge Kevin R. Cornelius of the FBI, Cincinnati Division, Superintendent of the Ohio State Highway Patrol (OSP) Colonel Paul A. Pride and Licking County Prosecutor Kenneth W. Oswalt made the announcement.

"There can be no greater breach of trust or abuse of authority than a police officer exploiting the power of his badge to sexually abuse the very citizens he has sworn to protect,” said Assistant Attorney General Caldwell.  “Today’s guilty plea should serve as a reminder that nobody is above the law, especially those who have taken an oath to uphold it.” 

“I thank the State Patrol for bringing this matter to our attention and the State Patrol and FBI for conducting an exhaustive investigation,” said U.S. Attorney Stewart. “I extend my sympathies to the victims of this unfortunate case. No one should ever have to fear illegal conduct from those very persons sworn to protect them and uphold the law.

According to court documents, Bryan D. Lee, 30, of Lancaster, Ohio, served as an OSP Trooper from approximately January 2006 until October 2013.  In his plea agreement, Lee admitted that he violated the civil rights of four female victims by coercing them to engage in sexual acts, some of which he photographed, in exchange for his agreement not to file criminal charges or issue traffic infractions against the victims or their friends.  Some of those acts were performed while the victims were under arrest and restrained in handcuffs.  Lee also harassed and threatened some of the victims, including sending threatening electronic messages to one individual who Lee pulled over twice during a one-month period.

The investigation into Lee began when a routine review by OSP of the dash camera recordings in Lee’s cruiser revealed inappropriate conduct with a female driver and passenger whom Lee had stopped for a traffic violation.  OSP uncovered multiple instances of administrative and criminal misconduct by Lee and contacted the FBI to assist in their investigation. Lee resigned his position at the outset of the investigation.

Lee’s sentencing hearing will be scheduled by U.S. District Judge Michael H. Watson of the Southern District of Ohio.

This case was investigated by the Columbus office of the FBI’s Cincinnati Field Division and OSP.  The case was prosecuted by Assistant U.S. Attorney J. Michael Marous of the Southern District of Ohio and Trial Attorney Edward P. Sullivan of the Criminal Division’s Public Integrity Section.  Also assisting in the investigation was Licking County Special Prosecutor Martin Frantz.

Eleven men have been sentenced to federal prison for their roles in an international child pornography network operated online, which was targeted by state and federal investigators and prosecutors participating in Operation Kingdom Conqueror. 

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Michael W. Cotter of the District of Montana and Special Agent in Charge Mary Rook of the FBI’s Salt Lake City Division made the announcement.

According to court documents, in November 2009, an early participant in the conspiracy designed and created an online bulletin board that allowed members to exchange images, including child pornography.  As the conspiracy progressed, additional members contributed to the design and operations of the board.  Between Nov. 6, 2009, and March 19, 2012, members of the conspiracy used the online bulletin board to share pictures and videos of children engaged in sexually explicit conduct.  During that same time period, the participants agreed to use the online bulletin board to solicit additional images of child pornography, which they would then share and broadcast on the Internet.  Thirteen defendants have been charged and convicted for their participation in this child pornography network.

The following defendants pleaded guilty in April 2014 to conspiracy to advertise child pornography and were sentenced by U.S. District Judge Donald W. Molloy of the District of Montana:

• Tony Bronson, 53, of Gary, Indiana, was sentenced to serve 224 months on Oct. 28, 2014.

• Charles Crosby, 43, of Trenton, New Jersey, was sentenced to serve 210 months in prison on Oct. 23, 2014.

• Steve Humiston, 57, of Tacoma, Washington, was sentenced to serve 210 months in prison and ordered to pay a $5,000 fine on Oct. 23, 2014.

• John Johnson, 58, of Locust Grove, Virginia, was sentenced to serve 180 months in prison on Oct. 22, 2014.

• Robert Krise, 66, of Gaithersburg, Maryland, was sentenced to serve 180 months in prison on Oct. 22, 2014.

• Scott Long, 53, of Portland, Oregon, was sentenced to serve 200 months in prison on Oct. 21, 2014.

• Ian Nosek, 42, of Charlottesville, Virginia, was sentenced to serve 216 months in prison on Oct. 23, 2014.

• Phillip Morris, 42, of Jeffersonville, Indiana, was sentenced to serve 216 months in prison on Oct. 22, 2014.

• Joseph Purificato, 23, of Mount Vernon, Missouri, was sentenced to serve 180 months in prison on Oct. 28, 2014.

• Paul Wencewicz, 48, of Polson, Montana, was sentenced to serve 200 months in prison on Oct. 21, 2014.

• Jeffrey Woolley, 53, of Nicholasville, Kentucky, was sentenced to serve 180 months in prison and ordered to pay a $5000 fine on Oct. 28, 2014.

All of the defendants were ordered to forfeit their computers and storage devices. Purificato received a 10-year term of supervised release following his prison sentence.  All other defendants received lifetime terms of supervised release.  All defendants are required to pay $29,859 restitution.

Two additional defendants, Joshua Peterson, 45, of Prescott, Arizona, and Steven Grovo, 35, of Shirley, Massachusetts, were found guilty of participating in a child exploitation enterprise and a conspiracy to advertise child pornography on Oct. 9, 2014.  Both men are scheduled to be sentenced on Jan. 22, 2015, in Missoula, Montana. 

The investigation, referred to as Operation Kingdom Conqueror, is an ongoing cooperative effort between the Criminal Division’s Child Exploitation and Obscenity Section, FBI, Montana Department of Criminal Investigations, Helena and Polson Police Departments, Immigration and Customs Enforcement’s Homeland Security Investigations, Montana Internet Crimes Against Children Task Force, and the States of Jersey Police Department, Isle of Jersey.

Trial Attorney Maureen C. Cain of the Criminal Division’s Child Exploitation and Obscenity Section and Assistant U.S. Attorney Cyndee L. Peterson of the District of Montana prosecuted the case.

This case was initiated under the Department of Justice’s Project Safe Childhood initiative which was launched in 2006 to combat the proliferation of technology-facilitated crimes involving the sexual exploitation of children.  Through a network of federal, state, and local law enforcement agencies and advocacy organizations, Project Safe Childhood attempts to protect children by investigating and prosecuting offenders involved in child sexual exploitation.  It is implemented through partnerships including the Montana Internet Crimes Against Children (ICAC) Task Force.  The ICAC Task Force Program was created to assist state and local law enforcement agencies by enhancing their investigative response to technology facilitated crimes against children. 

A physical therapist assistant was sentenced today to serve 50 months in prison for his role in a $14.9 million fraud scheme, through which he and others billed Medicare for home health services that they never provided, and provided beneficiaries with prescriptions for unnecessary painkillers and other narcotics to induce them to sign false medical documents to support the fraudulent billings. 

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Detroit Office made the announcement.

Jigar Patel, 31, a physical therapist assistant from Madison Heights, Michigan, was sentenced by U.S. District Judge Terrence G. Berg in the Eastern District of Michigan.  In addition to his prison term, Patel was ordered to pay $1.9 million in restitution.

Patel, along with co-defendants Srinivas Reddy, 38, an unlicensed doctor from Bloomfield Hills, Michigan, and Shahzad Mirza, 43, a physical therapist from Canton, Michigan, were each convicted by a federal jury on April 30, 2014, of one count of conspiracy to commit health care fraud.  In addition, Mirza and Patel were each found guilty of two counts of health care fraud, and Reddy was found guilty of three counts of health care fraud.  Patel was also found guilty of one count of money laundering.  Reddy and Mirza will be sentenced at a later date. 

According to evidence presented at trial, between July 2008 and September 2011, the defendants used four home health care companies – Physicians Choice Home Health Care LLC, Quantum Home Care Inc., First Care Home Health Care LLC, and Moonlite Home Care Inc. – to fraudulently bill Medicare for home health care services that were never provided.  Through those companies, the defendants paid kickbacks to recruiters for the referral of Medicare beneficiaries.  In turn, the recruiters paid the beneficiaries cash and promised them access to unnecessary prescriptions for painkillers and other narcotics.  Through a fifth company, Phoenix Visiting Physicians, the defendants employed unlicensed individuals, including Reddy, to provide the beneficiaries with the promised prescriptions and to obtain the necessary information to complete the referrals for medically unnecessary home health care services.

Evidence presented at trial showed that beneficiaries signed blank medical paperwork that Patel and others then completed with false information purporting to show that care was provided, when it was not.  Patel, Mirza and others signed this paperwork, certifying that they had provided the services.  In the course of the conspiracy, Patel incorporated his own staffing company, MI Healthcare Staffing, through which he laundered proceeds of the fraud.

As a result of the defendants’ fraudulent conduct, Medicare paid nearly $15 million.

The defendants were charged in a superseding indictment on Feb. 6, 2012.  Three other individuals charged in the indictment remain fugitives.  The charges contained in an indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.

The case is being investigated by HHS-OIG and the FBI and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.  The case is being prosecuted by Assistant Chief Catherine K. Dick and Trial Attorneys Matthew C. Thuesen and Rohan A. Virginkar of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.

EBI LLC, doing business as Biomet Spine and Bone Healing Technologies and Biomet Inc. have agreed to pay $6.07 million to resolve allegations that EBI violated the False Claims Act by paying kickbacks to induce use of its bone growth stimulators and billing federal health care programs for refurbished stimulators, the Department of Justice announced today.  EBI is a medical device company located in Parsippany, New Jersey, that sells bone growth stimulators, which are used to repair fractures that are slow to heal.  It is a subsidiary of Biomet, which is based in Warsaw, Indiana.    

“Medical device companies must not use improper financial incentives to influence the decision to use their products,” said Acting Deputy Assistant Attorney General August Flentje of the Justice Department’s Civil Division.  “This settlement demonstrates the department’s commitment to protect patients, and the taxpayers who fund their care, by ensuring that medical decisions are based on the patients’ medical needs rather than the financial interests of others.”

The United States alleged that, from 2001 to 2008, EBI paid staff at doctors’ offices to influence doctors to order its bone growth stimulators.  These payments were allegedly provided pursuant to personal service agreements with staff members. The United States concluded that these payments violated the Anti-Kickback Act and resulted in false billings to various federal health care programs, including Medicare.  The settlement also resolves EBI’s disclosure that it received federal reimbursements for bone growth stimulators that had been refurbished.     

“This settlement demonstrates our resolve in ensuring that patients receive, and the government pays for, health care that is based on sound medical judgment, and not compromised by kickbacks,” said U.S. Attorney Carmen M. Ortiz of the District of Massachusetts. 

“Kickbacks taint medical decision-making, cause overutilization of services, and lead to increased taxpayer and patient costs,” said Special Agent in Charge Phillip Coyne of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG).  “These improper inducements have no place in government health programs relied on by millions of Americans.”

The settlement resolves in part an allegation filed in a lawsuit by Yu Yue, a former product manager for EBI, in federal court in New Jersey.  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.  Yu’s share has not yet been determined. 

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 $23 billion through False Claims Act cases, with more than $14.8 billion of that amount recovered in cases involving fraud against federal health care programs.

The settlement was the result of a coordinated effort by the Commercial Litigation Branch of the Civil Division; the U.S. Attorney’s Office for the District of Massachusetts; HHS-OIG; the U.S. Postal Service Office of Inspector General; the Defense Criminal Investigative Service; the U.S. Department of Veterans Affairs, Office of Inspector General and the U.S. Food and Drug Administration, Office of Criminal Investigations.    

Ms. Yu’s case is captioned United States ex rel. Yu v. Biomet, Inc., Civil Action No. 09-1731 (D.N.J.).  The claims resolved by the settlement are allegations only; there has been no determination of liability. 

A former bail bondsman in Dothan, Alabama, was sentenced yesterday to serve 51 months in prison for his involvement in a stolen identity tax refund fraud (SIRF) scheme, Acting Deputy Assistant Attorney General Larry J. Wszalek for the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama announced.

Roderick Neal was also ordered to pay $109,480 in restitution and to serve three years of supervised release following his prison sentence.

According to court documents and evidence from the trial of his co-conspirator, Nina Macena, Neal provided stolen identities to Ivory Bolen, also of Dothan, who used the identities to file false tax returns that fraudulently requested refunds from the Internal Revenue Service (IRS).  Bolen would attempt to have the refunds deposited onto prepaid debit cards, which would be mailed to addresses controlled by Bolen and Macena.  Macena obtained the identities from Neal, who had access to the personal information of individuals who had been detained at the Dothan City Jail.  Altogether, Bolen filed tax returns claiming more than $300,000 in refunds using the identities that Neal stole from his employer, but the IRS was able to successfully stop a number of the fraudulent returns. 

Bolen was sentenced to serve 48 months in prison and Macena was sentenced to serve 34 months in prison.

This case was investigated by special agents of the IRS-Criminal Investigation.  Trial Attorneys Jason Poole, Charles M. Edgar Jr. and Michael Boteler of the Tax Division prosecuted the case with the assistance of the U.S. Attorney’s Office for the Middle District of Alabama.

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

Eric Walters, 39, and Franklin Brown, 35, formerly police officers with the City of Marion Police Department, in South Carolina, pleaded guilty yesterday in federal court to using excessive force against a woman with mental disabilities on April 2, 2013, the Justice Department announced today.

Walters and Brown each pleaded guilty to one count of deprivation of rights under color of law for using unreasonable force for their role in repeatedly tasing the victim when she posed no threat to either officer.  Walters and Brown pleaded before U.S. District Court Judge Bryan Harwell in federal court in Florence, South Carolina.

According to the information and facts presented in court, in the course of detaining the victim, Walters tased the victim causing her to fall to the ground and injure her head.  Once on the ground, Walters continued to tase the victim multiple times.  Brown, subsequently, arrived on scene and proceeded to tase the victim as she was seated on the curb, restrained in handcuffs, and surrounded by law enforcement.  In court, Walters and Brown admitted there was no legitimate law enforcement purpose for repeatedly tasing the victim as she did not pose a threat to the officers. 

“The defendants abused their authority as law enforcement officers by repeatedly tasing a defenseless, compliant victim,” said Acting Assistant Attorney General Vanita Gupta for the Civil Rights Division.  “The Justice Department will continue to vigorously prosecute those who cross the line to engage in acts of criminal misconduct.”  

“Law enforcement officers are entrusted with the state’s police powers to maintain and restore order,” said U.S. Attorney Bill Nettles for the District of South Carolina.  “In this case, the officers abused that authority, and purposefully hurt the victim who at the time posed no threat to these officers or anyone else.  No just society can tolerate this sort of abuse by those who wear the badge.  I’d like to thank the Federal Bureau of Investigations, the South Carolina Law Enforcement Division, the Department of Justice Civil Rights Division and the team in my office who worked together to ensure that these officers were held accountable for their misdeeds.”

Sentencing will be scheduled at a later date.  Walters and Brown face statutory maximum penalties of 10 year sentences in prison and $250,000 fines.

The case was investigated by the Columbia Division of the FBI and is being prosecuted by Assistant U.S. Attorney John Potterfield of the District of South Carolina and Trial Attorneys Nicholas Murphy and Henry Leventis of the Civil Rights Division.

A Texas federal court permanently barred Melissa Alvarez, a tax preparer in McAllen, Texas, from preparing returns for others, the Justice Department announced today.  Alvarez agreed to the permanent ban, and the court entered an order imposing a permanent injunction against Alvarez on Oct. 27.

The order also requires Alvarez to turn over to the government a list of all customers for whom she prepared federal tax returns or claims for a refund for tax years 2011 through 2013, and to notify her customers for tax year 2013 of the permanent injunction against her.  The order authorizes the government to monitor Alvarez’s compliance with the terms of the order.

The complaint alleged that Alvarez prepared returns that contained false, improper or inflated deductions or tax credits, such as the earned income tax credit.  The complaint also alleged that these activities caused Alvarez’s customers to file returns which unlawfully understated income and tax liabilities and overstated refunds.

Return-preparer fraud is one of the Internal Revenue Service’s (IRS) Dirty Dozen Tax Scams for 2014.  The IRS has some tips on their website for choosing a tax preparer.  In the past decade, the Tax Division has obtained injunctions against hundreds of fraudulent tax preparers.  Information about these cases is available on the Justice Department 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.

A Wilmington, North Carolina, man was sentenced yesterday to serve 12 months and one day in prison for tax evasion by Chief U.S. District Judge James C. Dever III in Raleigh, North Carolina, the Justice Department and Internal Revenue Service (IRS) announced today. 

Jeffrey Wayne Scott, 48, pleaded guilty on May 14 to one count of willfully attempting to evade his personal income tax for tax year 2007.

According to court documents and court proceedings, Scott has owned and operated Greenville Loop Seafood (GLS), a seafood distribution company located in Wilmington, since 1995.  For tax years 2006 through 2010, Scott and his wife filed joint individual income tax returns.  Scott, under penalty of perjury, reported that his taxable income for these five years ranged between $23,934 and $92,999, and paid only $91,800 in federal income taxes for this time period.  However, during these five years, the Scotts spent far in excess of this reported taxable income on personal expenditures.

According to court documents and court proceedings, between 2006 and 2010, the Scotts paid for nearly all of their living expenses with checks from GLS.  This included, among other things, utilities, insurance premiums, landscaping, home improvements, school fees and a country club membership.  They also purchased five vehicles totaling more than $200,000, a $100,000 boat and a $2.1 million waterfront home.  Scott also made a monthly transfer of $10,000 from the GLS business account into a personal brokerage account.  After the purchase of their home in June 2009, Scott stopped transferring funds to the brokerage account, but instead used funds from the GLS business account to pay the mortgage and related expenses.  The IRS calculated that Scott failed to report in excess of $1,270,000 in taxable income for these five years and owed at least $412,844 in additional federal income taxes. 

According to court documents and court proceedings, when first contacted by IRS-Criminal Investigation agents in June 2011, Scott falsely stated that he was letting friends stay in his second home rent free.  Furthermore, despite being aware that he was under criminal investigation, in November 2012, Scott filed a false 2011 GLS corporate income tax return claiming work on his personal residence, including painting and repair work by a plumber , and health bills related to his family dog as business expenses.

This case was investigated by special agents of IRS-Criminal Investigation.  Assistant U.S. Attorney Susan B. Menzer for the Eastern District of North Carolina and Trial Attorney Todd A. Ellinwood of the Justice Department’s Tax Division are prosecuting the case.

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

A man was sentenced to serve 70 months in prison for his involvement in a stolen identity tax refund fraud (SIRF) scheme that used prisoner names and a corrupt U.S. Postal Service employee, Acting Deputy Assistant Attorney General Larry J. Wszalek for the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama announced.

Gregory Slaton was also ordered to pay $82,971 in restitution and to three years of supervised release following his prison sentence.

According to the court documents and court proceedings, Gregory Slaton conspired with his wife, Jacqueline Slaton, his brother-in-law, Harvey James, and a U.S. Postal Service employee, Vernon Harrison, to file false tax returns using stolen identities.  James and Jacqueline Slaton obtained stolen identities, including identities of inmates, and used those identities to file the false tax returns.  Gregory Slaton recruited Harrison into the conspiracy, who then provided Gregory Slaton with mailing addresses on his postal route to which they could mail the fraudulently claimed prepaid debit cards.  James and Jacqueline Slaton then directed the tax refunds to be issued on debit cards and checks and to be sent to the specified addresses on Harrison’s mail route. 

Harrison was previously sentenced to serve 111 months in prison, James was sentenced to serve 110 months in prison and Jacqueline Slaton was sentenced to serve 70 months in prison. 

The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the U.S. Postal Service’s Office of the Inspector General.  Trial Attorneys Jason Poole and Michael Boteler of the Tax Division are prosecuting the case with the assistance of Assistant U.S. Attorney Todd Brown for the Middle District of Alabama.

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

A man pleaded guilty yesterday to one count of conspiracy to file false claims and one count of aggravated identity theft for his involvement in a stolen identity tax refund fraud (SIRF) scheme, Acting Deputy Assistant Attorney General Larry J. Wszalek for the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama announced.

According to the court documents, between January 2011 and December 2013, Robert Walker and his co-conspirators filed false tax returns using stolen identities.  One co-conspirator obtained stolen identities from various sources, including the identities of employees from a Columbus, Georgia, company.  In order to file the false tax returns, Walker and his co-conspirators obtained several Electronic Filing Identification Numbers (EFIN) in the names of sham tax businesses.  The co-conspirators applied for bank products from various financial institutions, which mailed blank check stock and prepaid debit cards.  The anticipated tax refunds were directed to financial institutions, which in turn issued the refunds using checks or prepaid debit cards.  Walker and his co-conspirators cashed the fraudulent checks at several businesses located in Alabama.  Walker also deposited fraudulent refund checks into a bank account he controlled.

Walker’s sentencing is scheduled for Feb. 5, 2015.

The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives and the U.S. Postal Service’s Office of the Inspector General.  Trial Attorneys Michael Boteler, Charles M. Edgar Jr. and Gregory Bailey of the Tax Division are prosecuting the case with the assistance from Assistant U.S. Attorney Todd Brown for the Middle District of Alabama.

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

Following an eight-day trial, the jury convicted a college friend of alleged Boston Marathon bomber, Dzhokhar Tsarnaev, for making false statements to investigators assigned to the FBI’s Joint Terrorism Task Force.

The jury found Robel Phillipos, 21, of Cambridge, Massachusetts, guilty of making false statements during the terrorism investigation of the Boston Marathon bombings on April 20, 2013, and April 25, 2013.  U.S. District Judge Douglas P. Woodlock scheduled sentencing for Jan. 29, 2015. 

 “In the wake of one of the most significant events in this City’s modern history – an event which left two young women and a child dead, and many more injured – thousands of ordinary citizens assisted law enforcement in identifying and locating the perpetrators,” said U.S. Attorney Carmen Ortiz for the District of Massachusetts.  “Today, a federal jury concluded that Robel Phillipos did just the opposite.  He lied to agents when he could have helped.  He concealed when he could have assisted.  It is a crime to lie to law enforcement agents, and that is why Robel Phillipos was charged and why the jury found him guilty today.  But this case also reminds us that our public safety network relies on every citizen in the Commonwealth.  We look to all of our citizens – our neighbors, our friends, our colleagues, even strangers whom we have never met before – to assist law enforcement in detecting, preventing, and solving crimes.  Mr. Phillipos made a choice: a choice to lie instead of tell the truth.  With its verdict today, the jury got it exactly right.” 

In August 2014, Dias Kadyrbayev pleaded guilty to obstruction of justice charges related to the Boston Marathon bombing investigation.  Kadyrbayev admitted to removing evidence from Tsarnaev’s dormitory room at University of Massachusetts Dartmouth and discarding Tsarnaev’s backpack with fireworks, some of which appeared to have been emptied of their explosive powder, in a garbage dumpster.  In July 2014, Azamat Tazhayakov was found guilty by a federal jury in Boston of obstruction of justice charges for his role in impeding the Boston Marathon bombing investigation.  His conduct was related to the same conduct as charged against Kadyrbayev that occurred in Tsarnaev’s dormitory room on the evening of April 18, 2013.   

At the Phillipos trial, the government proved that Phillipos lied about his knowledge and activities on the evening of April 18, 2013.  Specifically, Phillipos repeatedly lied to investigators when he denied that, on the evening of April 18, 2013, he entered Tsarnaev’s dormitory room and saw Kadyrbayev remove a backpack containing fireworks. 

According to evidence presented at trial, at 7:00 p.m. on April 18, 2013, Phillipos saw the images released by the FBI of the two suspected bombers and immediately recognized one of them as Dzhokhar Tsarnaev.  At 10:00 p.m., Phillipos went with Tazhayakov to Tsarnaev’s dormitory room where he and Tazhayakov watched, as Kadyrbayev searched through Tsarnaev’s belongings and found a backpack containing fireworks.  When Kadyrbayev, Tazhayakov and Phillipos left Tsarnaev’s room at 10:30 p.m., Kadyrbayev removed Tsarnaev’s backpack containing fireworks, a jar of Vaseline, and Tsarnaev’s laptop computer.  Later that night while Tazhayakov and Phillipos were monitoring the manhunt for the Tsarnaevs on television, Kadyrbayev discussed getting rid of the backpack containing the fireworks with them.  Tazhayakov agreed with Kadyrbayev that they should get rid of it.  After this conversation, Kadrybayev placed Dzhokhar Tsarnaev’s backpack in a garbage bag and placed it in a dumpster outside their New Bedford apartment.  The FBI recovered the backpack a week later, after 30 agents spent two days searching a landfill in New Bedford. 

Between April 19, 2013 and April 26, 2013, Phillipos was interviewed five times by investigators conducting the Boston Marathon bombing investigation and during each of those interviews Phillipos lied.  At the conclusion of the fifth interview, Phillipos finally admitted that he did go into Tsarnaev’s dormitory room on the evening of April 18, 2013 and that he saw Kadyrbayev remove evidence from Tsarnaev’s room.  After he confessed, Phillipos indicated he regretted his decisions.  In his signed statement, Phillipos stated: “In retrospect, I should have notified the Police once I knew Jahar was the bomber.  Further, I should have turned over the backpack to the authorities.”

The charging statute provides a sentence of no greater than eight years in prison for each of the two false statement counts, three years of supervised release, and a fine of $250,000 for each charge.  Actual sentences for federal crimes are typically less than the maximum penalties.  Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

The sentencing hearing for Kadyrbayev is scheduled for Nov. 18, 2014, and Tazhayakov’s sentencing is scheduled for Nov. 19, 2014.   

U.S. Attorney Ortiz and Special Agent in Charge Vincent B. Lisi of the Federal Bureau of Investigation’s Boston Field Division made the announcement today.  This investigation was conducted by the FBI's Boston Division and member agencies of the Boston Joint Terrorism Task Force (JTTF) which is comprised of more than 30 federal, state and local enforcement agencies.  Essex County Sheriff’s Office, U.S. Department of Transportation – Office of Inspector General, Massachusetts State Police, University of Massachusetts Dartmouth Department of Public Safety, New Bedford Police Department, Dartmouth Police Department, U.S. Treasury Inspector General for Tax Administration (TIGTA), Internal Revenue Service, Criminal Investigations, and Homeland Security Investigations in Boston provided assistance to this investigation.

The case is being prosecuted by Assistant U.S. Attorneys B. Stephanie Siegmann and John A. Capin of U.S. Attorney Ortiz’s Anti-Terrorism and National Security Unit.

A Fresno, California, resident was sentenced to serve 18 months in prison and pay $703,537 in restitution for conspiring to defraud the Internal Revenue Service (IRS) by aiding to obtain payment of fraudulent tax refund claims and committing wire fraud, the Justice Department and IRS announced today. 

Pursuant to a plea agreement, Kathryn Darlene Coryell pleaded guilty to two counts of a 44-count indictment on June 26.  Her co-defendant, Noemi Baez, pleaded guilty on Oct. 31, 2013, to charges of conspiring to defraud the IRS and committing aggravated identity theft.

According to the plea agreement, beginning around Feb. 28, 2008, and continuing through April 16, 2012, Coryell and Baez participated in a scheme to obtain and help others to obtain payment of false claims for tax refunds from the IRS by electronically filing fraudulent federal income tax returns.  Using the names and social security numbers of numerous individuals, Coryell and Baez fabricated income information and filed materially false income tax returns claiming tax refunds derived from credits, including the Earned Income Credit, the Additional Child Tax Credit and the Making Work Pay Credit.  In the plea agreement, Coryell admitted that, during the conspiracy, she and her co-defendant filed more than 150 false tax returns claiming fraudulent tax refunds totaling more than $400,000.

The case was investigated by special agents of the IRS-Criminal Investigation and was prosecuted by Trial Attorneys Erin S. Mellen, Sonia M. Owens and Charles A. O’Reilly of the Tax Division.

Two women from Phenix City, Alabama, were indicted yesterday for their involvement in a stolen identity refund fraud scheme (SIRF), Acting Deputy Assistant Attorney General Larry J. Wszalek for the Justice Department's Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama announced today following the unsealing of the indictment.

Teresa Floyd and her daughter, Lasondra Davis Miles, were charged with conspiracy to submit false claims, wire fraud and aggravated identity theft.  Floyd was also charged with theft of public money. 

According to the superseding indictment, Floyd and Davis operated several tax preparation businesses in the Phenix City area, including T & L Tax Service and T & C Used Cars & Tax Service.  Floyd and Davis obtained stolen identities and used those identities to file more than 900 federal income tax returns that claimed more than $2.5 million in tax refunds.  To obtain the money from the scheme, the defendants applied for bank products from various financial institutions, which provided to the defendants blank check stock.  The bank products allow a tax preparer to deduct their fees directly from a tax refund and then print out the remainder of the refund as a check.  Floyd and Davis created fictitious identification documents and bills to provide to the financial institutions in an attempt to verify that the returns were filed in the names of legitimate customers.  The defendants caused the fraudulent checks to be cashed at several businesses in Alabama and Georgia.  Floyd also deposited fraudulent income tax refund checks into her bank account. 

If convicted, the defendants face a statutory maximum sentence of 10 years in prison for the conspiracy to file false claims count, a statutory maximum sentence of 20 years in prison for each wire fraud count, a statutory maximum sentence of 10 years in prison for each theft of public money count and a mandatory sentence of two years in prison for the aggravated identity theft counts.  The defendants are also subject to fines, forfeiture and mandatory restitution if convicted.

The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation.  Trial Attorney Michael Boteler of the Tax Division and Assistant U.S. Attorney Todd Brown for the Middle District of Alabama are prosecuting the case. 

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

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

A Massachusetts man was sentenced to serve four years in prison today for hacking into computer networks around the country – including networks belonging to law enforcement agencies and a local college – to obtain highly sensitive law enforcement data and to alter academic records, as well as for possessing stolen credit and debit card numbers.  

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Carmen M. Ortiz of the District of Massachusetts, Special Agent in Charge Vincent Lisi of the FBI’s Boston Division and Colonel Timothy P. Alben of the Massachusetts State Police made the announcement.

Cameron Lacroix, 25, of New Bedford, Massachusetts, pleaded guilty on June 25, 2014, to two counts of computer intrusion and one count of access device fraud.  Lacroix was sentenced today by U.S. District Judge Mark L. Wolf of the District of Massachusetts. 

Lacroix admitted that, between May 2011 and May 2013, he obtained and possessed payment card data for more than 14,000 unique account holders.  For some of these account holders, Lacroix also obtained other personally identifiable information.

Additionally, from August 2012 through November 2012, Lacroix repeatedly hacked into law enforcement computer servers containing sensitive information including police reports, intelligence reports, arrest warrants, and sex offender information.  In one such instance, in September 2012, Lacroix hacked into a computer server operated by a local Massachusetts police department and accessed an e-mail account belonging to the chief of police. 

Lacroix, who was a student at Bristol Community College (BCC), also admitted that between September 2012 and November 2013, he repeatedly hacked into BCC’s computer servers and used stolen log-in credentials belonging to three instructors to change grades for himself and two other students. 

The case was investigated by the FBI’s Boston Division Cyber Task Force.  The case is being prosecuted by Senior Trial Attorney Mona Sedky from the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Adam Bookbinder of the District of Massachusetts.

The U.S. Attorney’s Office for the Northern District of California has also filed hacking charges against Lacroix.  That case has been transferred to the District of Massachusetts and is before Chief Judge Saris.

Four members of a robbery crew that targeted jewelry couriers were sentenced to federal prison for their roles in conspiracy to commit a Hobbs Act robbery and related offenses.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Sally Quillian Yates of the Northern District of Georgia made the announcement.

Honorio Sanchez-Valenica, 46, of Gwinnett, Georgia, John Rodriguez, 37, of Los Angeles, Ali Alejandro Godoy-Maximo, 25, of Los Angeles, and Michael Alejandro Tovar-Vargas, 37, of Los Angeles, were sentenced to serve 137 months in prison, 63 months in prison, 68 months in prison and 87 months in prison respectively for their involvement in the Jan. 31, 2013, robbery of a jewelry courier at a gas station in Buford, Georgia.  In addition to the prison sentences, the defendants were ordered to pay $122,398 in restitution.  U.S. District Judge Steve C. Jones of the Northern District of Georgia imposed the sentences.  Jose Vicente Ramirez-Rodriguez, 38, of Los Angeles, also pleaded guilty for his role in the robbery and will be sentenced on Dec. 10, 2014.

Court records show that on Jan. 31, 2013, the defendants robbed a jewelry courier while he was putting gas in his car.  Two of the defendants approached the victim, one restrained him with a knife, and the other smashed the car’s window and took a briefcase containing over $125,000 in assorted jewelry.

In his plea agreement, Sanchez-Valencia also admitted to his involvement in a similar robbery in Dallas on Aug. 27, 2012.  In that robbery, Sanchez-Valencia conducted surveillance of two jewelry couriers at a restaurant.  Within minutes after Sanchez-Valencia left, three masked men with a gun came into the restaurant and robbed the jewelry couriers, taking two briefcases containing over $500,000 in jewelry.  Some of that jewelry was later recovered by law enforcement during the execution of a search warrant at a storage unit rented by Sanchez-Valencia.

This case was investigated by the FBI, Immigration and Customs Enforcement, and the Gwinnett County Police Department, with assistance from the Dallas Police Department.  This case is being prosecuted by Laura Gwinn of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorney Kim Dammers of the Northern District of Georgia.

The former president and owner of a rehabilitation therapy services clinic pleaded guilty in Tampa today to health care fraud and money laundering charges.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney A. Lee Bentley III of the Middle District of Florida, Acting Special Agent in Charge Derrick Jackson of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office and Special Agent in Charge Paul Wysopal of the FBI’s Tampa Field Office made the announcement.

Laura Leyva, 45, of Miami Lakes, Florida, pleaded guilty in the U.S. District Court for the Middle District of Florida to conspiracy to commit health care fraud and conspiracy to commit money laundering.  Her sentencing date will be set by the court.

According statements made in court, from June 2007 through November 2009, Leyva was the president and owner of American Rehab of Kissimmee Inc., aka American Rehab of South Florida Inc., a comprehensive outpatient rehabilitation facility located in Kissimmee, Florida, and Hialeah, Florida.  During that time period, American Rehab submitted approximately $2,543,368 in false and fraudulent claims for reimbursement to Medicare seeking payment for rehabilitation therapy services that were not legitimately prescribed and not provided.  Medicare paid approximately $1,074,278 on those claims.  Co-conspirators falsified and forged medical records were used to give the appearance that therapy services were rendered to Medicare beneficiaries at American Rehab when, in fact, they were not.  Leyva admitted that she destroyed falsified medical records in order to conceal evidence of the health care fraud and money laundering scheme.

This case is being investigated by HHS-OIG and the FBI and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Middle District of Florida.  This case is being prosecuted by Trial Attorney Christopher J. Hunter of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,000 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Team (HEAT), go to: www.stopmedicarefraud.gov.

In the latest development following the Supreme Court’s decision earlier this month to decline to hear any pending cases regarding same-sex marriage, Attorney General Eric Holder announced Saturday that the federal government will now recognize same-sex married couples in six new states: Alaska, Arizona, Idaho, North Carolina, West Virginia, and Wyoming.  

Last week, the Attorney General made a similar announcement with respect to seven other states: Colorado, Indiana, Nevada, Oklahoma, Utah, Virginia and Wisconsin. Saturday’s announcement adds to that list and brings the total number of states where same-sex couples are recognized by the federal government to 32, plus the District of Columbia.

The Attorney General’s announcement means couples married in these states will now qualify for a range of federal benefits, including those administered by the Social Security Administration and Department of Veterans Affairs.

“With each new state where same-sex marriages are legally recognized, our nation moves closer to achieving of full equality for all Americans,” the Attorney General said. “We are acting as quickly as possible with agencies throughout the government to ensure that same-sex married couples in these states receive the fullest array of benefits allowable under federal law.”

In addition, the Attorney General also announced that the Department of Justice has determined it can legally recognize marriages performed in Indiana and Wisconsin this past June. These marriages were performed immediately after federal district courts ruled that those states’ bans on same-sex marriage are unconstitutional, but subsequent developments created confusion about the status of those marriages. Based on the Attorney General’s announcement, however, those couples married during that period will now have their unions recognized by the federal government.

The United States filed a civil complaint for injunctive relief in the U.S. District Court for the District of South Dakota against 2035 Inc. and its president, Dr. Robert L. Lytle, the Department of Justice announced today.  Lytle, who does business as 2035 Private Membership Association and QLasers Private Membership Association, is the owner and operator of 2035 Inc. 

According to the complaint, the defendants are responsible for designing, manufacturing, marketing and distributing the QLaser System, a collection of approximately 12 devices that are marketed as low level laser devices for home use.  The defendants market their devices throughout the country – through seminars, websites, newspaper ads and other means – for treatment of “over 200 different diseases and disorders,” including cancer, cardiac arrest, HIV/AIDS, diseases and disorders of the eye and ear, venereal disease and diabetes.  Although two of the devices are cleared for providing temporary relief of pain associated with osteoarthritis of the hand, none of the devices have been cleared by the U.S. Food and Drug Administration (FDA) or otherwise approved to treat any other medical conditions.  Failure to obtain FDA clearance or premarket approval before marketing and distributing a device renders the device adulterated and misbranded and violates the Food, Drug, and Cosmetic Act (FDCA). 

“The public should be able to trust that medical devices marketed to them to treat certain conditions are shown to be safe and effective,” said Acting Assistant Attorney General Joyce R. Branda for the Justice Department’s Civil Division.  “The Department of Justice will take action to ensure that public health is not put at risk.”

According to the complaint, the defendants distribute labeling with the QLaser devices that touts their use for treatment of the serious conditions listed above, as well as their use on eyes and skin.  However, the complaint alleges, applying the laser devices to the eyes and skin can be harmful, and use of the devices to treat serious conditions such as cancer, HIV/AIDS and diabetes, among others, is unsupported by any published clinical studies.  The complaint further alleges that the medical claims regarding use of the laser devices to treat these conditions are false and misleading and that the devices are unsafe if used in the manner recommended or suggested in defendants’ labeling.

During multiple inspections of the defendants’ operations over the course of approximately 11 years, the FDA informed the defendants – both verbally and in writing – that they were violating the FDCA.  Despite these warnings, the complaint alleges that defendants continue their violations.  Most recently, in August and September 2014, FDA investigated the defendants’ business operations, including QLasers PMA, and www.qlaserspma.com, a website owned and operated by Lytle through QLasers PMA.  According to the complaint, these investigations revealed that the defendants continue to make claims that cause their QLaser devices to be in violation of the law.

The government requests that the court enjoin the defendants from continuing to market their QLaser devices, or any other device, unless or until such devices receive FDA clearance or approval.  The complaint further requests the court order the defendants to cease manufacturing, processing, packaging, labeling, holding or distributing any product that is a device unless and until the defendants have come into compliance with the FDCA.

“After several warnings from the FDA, this distributor was well aware he was in violation of the law by continuing to market laser devices for unapproved uses,” said U.S. Attorney Brendan V. Johnson for the District of South Dakota.  “Regardless, he continued to put consumers at risk, leading them to believe the product they were buying from his companies could treat certain serious medical conditions.  Consumer confidence is critical, and the Department of Justice will work to protect that confidence and keep the public safe.”

The FDA referred this matter to the Department of Justice.  Trial Attorneys Cindy Cho and Ross Goldstein of the Consumer Protection Branch in the Civil Division, together with the U.S. Attorney’s Office for the District of South Dakota, brought this case on behalf of the United States. 

Alexander Beltran Herrera, 38, a commander of the Fuerzas Armadas Revolucionarias de Colombia (FARC) terrorist organization, was sentenced today to 27 years in prison on federal hostage-taking charges stemming from the 2003 capture of three U.S. citizens in Colombia.  All told, members of the FARC held the Americans hostage for 1,967 days.

The sentence was announced by John P. Carlin, Assistant Attorney General for National Security, Ronald C. Machen Jr., U.S. Attorney for the District of Columbia  and George L. Piro, Special Agent in Charge of the FBI’s Miami Division.

Beltran Herrera, aka Jhon Alexander Beltrain Herrera, aka Rodrigo Pirinolo, pled guilty on March 18, 2014, in the U.S. District Court for the District of Columbia, to three counts of hostage-taking.  He was sentenced by the Honorable Senior Judge Royce C. Lamberth.

 “In February 2003, the FARC – a Colombian terrorist organization – kidnapped three American citizens and held them captive for nearly 2,000 days,” said Assistant Attorney General Carlin.  With the sentence handed down today, Alexander Beltran Herrera is being held accountable for his role in those offenses.  This case underscores our resolve to pursue and bring to justice those who target our citizens with violence anywhere in the world.  I want to thank all of the prosecutors, agents, and analysts who made this result possible.”

 “This Colombian terrorist will spend the next 27 years in an American prison for his role in holding three U.S. citizens captive overseas,” said U.S. Attorney Machen.  “Our fellow citizens were held hostage for more than five years under brutal conditions.  This extradition, prosecution, and incarceration should chasten terrorists who doubt our resolve to serve justice on those who harm American citizens on foreign soil.”

 “Alexander Beltran Herrera, a former terrorist commander for the Fuerzas Armadas Revolucionarias de Colombia (FARC), will now be held accountable for his role in holding three U.S. citizens hostage in Colombia for 1,967 days,” said Kelly M. Darden, Acting Special Agent in Charge of the FBI’s Miami Division.  “Essential to bringing Beltran Herrera to justice was our close cooperation with the Colombian National Police.”

According to the government’s evidence, the FARC is an armed, violent organization in Colombia.  Since its inception in 1964, it has engaged in an armed conflict to overthrow the Republic of Colombia, South America’s longest-standing democracy.  The FARC has consistently used hostage taking as a primary technique in extorting demands from the Republic of Colombia, and hostage taking has been endorsed and commanded by FARC senior leadership.  The FARC has characterized American citizens as “military targets” and has engaged in violent acts against Americans in Colombia, including murders and hostage taking.  The FARC was designated as a foreign terrorist organization by the U.S. Secretary of State in 1997 and remains so designated.

Beltran Herrera, a commander in the FARC, was involved in the hostage taking of three United States citizens: Marc D. Gonsalves, Thomas R. Howes, and Keith Stansell.  These three, along with Thomas Janis, a United States citizen, and Sergeant Luis Alcides Cruz, a Colombian citizen, were seized on Feb. 13, 2003, by the FARC, after their single-engine aircraft made a crash landing in the Colombian jungle. 

Members of the FARC murdered Janis and Cruz near the crash site.  Gonsalves, Howes, and Stansell were held by the FARC at gunpoint and were advised by FARC leadership that they would be used as hostages to increase pressure on the government of Colombia to agree to the FARC’s demands.  At various times, the FARC marched the hostages from one site to another, placing them in the actual custody of various FARC fronts.

At the conclusion of one 40-day long march, in or about November 2004, the hostages were delivered to members of the FARC’s 27th Front, who imprisoned the hostages for nearly two years.  During part of this period, Beltran Herrera was responsible for moving the hostages and keeping them imprisoned.  Throughout the captivity of these three hostages, FARC jailors and guards used choke harnesses, chains, padlocks and wires to restrain the hostages, and used force and threats to continue their detention and prevent their escape.  In July 2008, the Colombian military conducted a daring operation which resulted in the rescue of the hostages. 

Beltran Herrera was indicted in February 2011 and was extradited to the United States from Colombia in March 2012.

This case was investigated by the FBI’s Miami Division.  The prosecution was handled by Assistant U.S. Attorneys Anthony Asuncion and Fernando Campoamor-Sanchez from the National Security Section of the U.S. Attorney’s Office for the District of Columbia, and Trial Attorney David Cora, from the Counterterrorism Section of the Justice Department’s National Security Division.  The case was indicted by Assistant U.S. Attorney Kenneth Kohl, of the National Security Section of the U.S. Attorney’s Office.  

The FBI’s Miami Division partnered in the investigation with the Justice Department’s Office of International Affairs, the Department’s Judicial Attachés in Colombia, and the FBI’s Office of the Legal Attaché in Bogota, Colombia.  The Directorate of Intelligence (DIPOL) and the Anti-Kidnapping Unit (GAULA) of the Colombian National Police also provided valuable support during the investigation.