District Not Recorded

The Justice Department announced today that General Electric Hitachi Nuclear Energy Americas LLC (GE Hitachi) has agreed to pay $2.7 million to resolve allegations under the False Claims Act that it made false statements and claims to the Department of Energy and the Nuclear Regulatory Commission (NRC) concerning an advanced nuclear reactor design.  GE Hitachi, a provider of nuclear energy products and services headquartered in Wilmington, N.C., is a subsidiary of General Electric Company (GE) that is also partially owned by Hitachi Ltd., a multinational engineering and manufacturing firm headquartered in Tokyo, Japan.  GE is headquartered in Fairfield, Conn. 

 
“Transparency and honesty are absolutely critical when dealing with issues relating to the design of a nuclear reactor,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.  “The Department of Justice will protect federal funds and the Nuclear Regulatory Commission’s crucial mandate of ensuring public safety.”   

 
“Fraud involving government contracts will be zealously pursued in North Carolina,” said U.S. Attorney for the Eastern District of North Carolina Thomas G. Walker.  “We encourage our citizens to report fraud related to government contracts and our federal programs.” 

 
GE Hitachi allegedly made false statements to the NRC and Department of Energy about a component of the advanced nuclear Economic Simplified Boiling-Water Reactor (ESBWR) known as the steam dryer.  A steam dryer removes liquid water droplets from steam produced by the nuclear reaction that generates electricity in boiling-water type reactors.  The NRC requires that applicants for nuclear reactor design certification, such as GE Hitachi, demonstrate that vibrations caused by the steam dryer will not result in damage to a nuclear plant.  The government alleged that GE Hitachi concealed known flaws in its steam dryer analysis and falsely represented that it had properly analyzed the steam dryer in accordance with applicable standards and had verified the accuracy of its modeling using reliable data.     

Between 2007 and 2012, GE Hitachi received funding from the Department of Energy to cover up to half of the cost of developing, engineering and obtaining design certification for the advanced nuclear ESBWR.  The NRC, which regulates the civilian use of nuclear power in the U.S., is responsible for determining whether to approve GE Hitachi’s application for the reactor design certification.  The NRC is still reviewing the application and has not reached a final decision on the certification. 

 
“The Nuclear Regulatory Commission supports the settlement and appreciates the Department of Justice’s close coordination during its investigation of these allegations,” said Director of NRC’s Office of New Reactors Glenn Tracy.  “The NRC continues to rigorously review the ESBWR application in order to reach a final design certification decision, ensure compliance with NRC regulations and protect public health and safety.”

 
The allegations resolved by this settlement arose from a whistleblower lawsuit filed under the False Claims Act by LeRay Dandy, a former employee of GE Hitachi.  Under the False Claims Act, private citizens can sue on behalf of the government and share in any recovery.  Dandy’s share of the settlement has not been determined.   

This case was handled by the Department of Justice Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the Eastern District of North Carolina and the Offices of Inspector General for the Nuclear Regulatory Commission and the Department of Energy.  

The lawsuit is captioned United States ex rel. Dandy v. General Electric Hitachi Nuclear Energy Americas LLC, General Electric Company, 7:12-cv-009 (E.D.N.C.).  The claims resolved by the settlement are allegations only, and there has been no determination of liability.

U.S. Attorney General Eric Holder on Thursday urged Congress to pass the bipartisan Smarter Sentencing Act, introduced by Senators Dick Durbin and Mike Lee. A copy of the Attorney General's statement, which was recorded as an online video, appears below:   “Our criminal justice system works only when all Americans are treated equally under the law. 

That’s why, in 2010, Congress passed the landmark Fair Sentencing Act, marking the culmination of persistent efforts – with the leadership of President Obama – to reduce unjust disparities in sentencing for similar offenses involving different types of drugs.

More recently, President Obama took another step by commuting the sentences of eight individuals who were sentenced under the outdated sentencing regime. 

And at the Justice Department, we’ve announced additional reforms – under our “Smart on Crime” initiative – to ensure that individuals accused of certain low-level federal drug crimes no longer face excessive mandatory minimum sentences that are out of proportion with their alleged conduct – and serve no deterrent purpose.

These reforms have the potential to help make our criminal justice system not only fairer, but also – by reducing the burden on our overcrowded prison system – more efficient. 

And now, we have the opportunity for leaders from both parties to come together to do even more.

Today, I’m urging Congress to pass common-sense reforms like the bipartisan Smarter Sentencing Act, introduced by Senators Dick Durbin and Mike Lee – which would give judges more discretion in determining appropriate sentences for people convicted of certain federal drug crimes.

 This bill would also provide a new mechanism for some individuals – who were sentenced under outdated laws and guidelines – to petition judges for sentencing reductions that are consistent with the Fair Sentencing Act.

Thanks to the leadership of Senators Durbin and Lee – along with Chairman Patrick Leahy and Senator Rand Paul – it’s clear that these and similar proposals enjoy bipartisan support on Capitol Hill. 

These reforms would advance the goals of the Smart on Crime initiative – and other efforts that are currently underway – by fundamentally improving policies that exacerbate, rather than alleviate, key criminal justice challenges.

And such legislation could ultimately save our country billions of dollars in prison costs while keeping us safe.

I look forward to working with members of both parties to refine and advance these proposals in the days ahead. 

And I pledge my own best efforts – and those of my colleagues throughout the Justice Department – to continue to strengthen America’s criminal justice system, and to build the more just society that everyone in this country deserves.”

The full video message can be viewed online at: http://www.justice.gov/agwa.php.

Three Georgia men have been charged in a 51-count indictment for their alleged participation in fraud and corruption schemes at the Marine Corps Logistics Base (MCLB) in Albany, Ga., resulting in the loss of millions of dollars to the United States government.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Michael J. Moore for the Middle District of Georgia made the announcement after the indictment was unsealed in the Middle District of Georgia today.

Christopher Whitman, 48, co-owner of United Industrial of Georgia Inc. (also known as ULOC), an Albany-based trucking company and freight transportation broker , was indicted on 43 counts of money, property and honest services wire fraud, five counts of bribery and one count of theft of government property. Shawn McCarty, 36, of Albany, a former employee at the MCLB-Albany, was charged with 30 counts of money, property and honest services wire fraud and one count of bribery; and Bradford Newell, 43, of Sylvester, Ga., also a former employee at the MCLB-Albany, was charged with 13 counts of money, property and honest services wire fraud, one count of bribery, and one count of theft of government property.

The three men were arrested earlier today and appeared before U.S. Magistrate Judge Thomas Q. Langstaff. Judge Langstaff ordered the three men detained pending further hearings next week.

According to the indictment, Whitman paid nearly $1 million in bribes to Mitchell Potts, the former traffic office supervisor for the Defense Logistics Agency (DLA) at MCLB-Albany, Jeff Philpot, the former lead transportation assistant in the traffic office, and Shawn McCarty, another transportation assistant in the traffic office, to obtain commercial trucking business from the DLA. The indictment alleges that Potts, Philpot and McCarty used their official positions to defraud the government and benefit ULOC by helping ULOC obtain transportation contracts loaded with unnecessary premium-priced requirements – including expedited service; removable gooseneck trailers, which do not require a loading dock and are therefore more expensive than standard trailers; and exclusive use, which requires that freight be shipped separately from other equipment – even if that results in a truck not being filled to capacity. The indictment alleges that Whitman and ULOC brokered these shipments for service without the premium specifications and on fewer trucks than requisitioned by DLA, but they billed the government at rates approved by the corrupt officials. These actions are alleged to have resulted in ULOC profits grossing more than $20 million over less than four years.

Whitman is accused of orchestrating a scheme to steal and sell surplus equipment from MCLB-Albany worth more than $1 million. Whitman allegedly paid approximately $200,000 in total bribes to Shelby Janes, the former inventory control manager of the Distribution Management Center (DMC) at MCLB-Albany, and Newell, an assistant to Janes, who used their official positions to help Whitman steal surplus equipment from the base, including bulldozers, cranes and front-end loaders. The indictment alleges that Whitman improved and painted the stolen equipment.

An indictment is merely a charge and the defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

If convicted, the defendants face up to 20 years in prison for each wire fraud count and 15 years in prison for each bribery count. The theft count carries a maximum prison term of 10 years. Each charged count carries a maximum fine of $250,000 or twice the gross gain.

Prior to this indictment, one former ULOC employee and three DLA officials pleaded guilty in connection with the fraud and corruption schemes alleged in the indictment. On Oct. 10, 2013, Kelli Durham, ULOC’s former manager, pleaded guilty to conspiracy to commit wire fraud, admitting to intentionally overbilling the United States for services ULOC did not perform, resulting in losses ranging from $7 million to $20 million, and for receiving $905,685 for her role. She faces a maximum penalty of five years in prison. In May 2013, Potts and Philpot pleaded guilty to bribery for collectively accepting more than $700,000 in bribes; and in February 2013, Janes pleaded guilty to bribery for receiving nearly $100,000 in bribes. The three former officials each face up to 15 years in prison.

The case is being investigated by the Naval Criminal Investigative Service, with assistance from the Dougherty County District Attorney’s Office Economic Crime Unit, Defense Criminal Investigative Service, DLA Office of the Inspector General, and the Department of Labor Office of the Inspector General. The case is being prosecuted by Trial Attorneys Richard B. Evans and J.P. Cooney of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney K. Alan Dasher of the Middle District of Georgia.

A campaign worker was indicted yesterday by a federal grand jury in the Southern District of Texas for allegedly paying voters to vote in a Donna, Texas school board election. Two other campaign workers were indicted on similar charged last week for alleged vote-buying in the election.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Kenneth Magidson of the Southern District of Texas made the announcement.

The three indictments charge Donna residents Diana Balderas Castaneda, 48; Guadalupe Zapata Escamilla, 72; and Rebecca Gonzalez, 44, with one count each of vote-buying. They face a maximum penalty of five years in prison upon conviction.

According to the indictments, a general election was held in Donna on Nov. 6, 2012, which included candidates for the presidential election, as well as for various state, county and local offices, including Donna School Board. The three defendants are alleged to have assisted in the campaign to elect the Democratic candidates to the Donna School Board. In the course of that work, the three women are accused of knowingly and willfully paying and offering to pay voters for voting in this election.

An indictment is merely an accusation, and a defendant is presumed innocent unless and until proven guilty in a court of law.

This case was investigated by the FBI. Trial Attorneys Monique Abrishami and Jennifer Blackwell of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Leo J. Leo of the Southern District of Texas are prosecuting the case.

SUMMARY: The Executive Office for Immigration Review invites interested parties to participate in a meeting regarding the new Country Pages section of the Virtual Law Library, the agency’s online legal research resource. The new section is an extensive collection of information about the conditions in countries around the world.

DATE: Friday, Jan. 31, 2014, at 2 p.m.

MEETING LOCATION: 5107 Leesburg Pike, Suite 1800, Falls Church, VA.

RSVP: To RSVP for the meeting, please contact Lauren Alder Reid, Counsel for Legislative and Public Affairs, 703-305-0289, PAO.EOIR@usdoj.gov, by noon on Jan. 30, 2014. Attendance will be limited to the first forty (40) individuals to RSVP. Those who are unable to attend in person will be able to participate via teleconference. Call-in information will be available to those who RSVP. To attend the meeting via conference call, please RSVP with the name(s) of the attendee(s), the attendee’s organization, and an email address where instructions may be sent for accessing the conference call.

- EOIR -

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

John Mills and Terrance Allen, both of Malone, New York, pleaded guilty yesterday in federal court in Albany, New York, to conspiracy to violate the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and substantive CERCLA counts in relation to the illegal removal, handling, and disposal of asbestos from properties owned and operated by John Mills, announced Robert G. Dreher, Acting Assistant Attorney General for the Environment and Natural Resources Division of the Department of Justice.

Mills and Allen were charged in an 11-count indictment alleging a conspiracy to impede the functions of the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Labor, Occupational Safety and Health Administration, and to violate the Clean Air Act and CERCLA, along with substantive violations of the Clean Air Act and CERCLA. The indictment further charged Mills and Allen with making false statements to law enforcement officers and Mills with retaliating against a witness. CERCLA requires that owners and operators of regulated facilities notify the National Response Center immediately after becoming aware of the release of more than one pound of asbestos into the environment.

Mills and Allen pleaded guilty to one count of conspiracy to violate CERCLA. Mills also pleaded guilty to two counts of knowingly violating CERCLA for failing to immediately report the release of more than a pound of asbestos from properties owned by Mills. In addition to the conspiracy, Allen pleaded guilty to one count of knowingly violating CERCLA.

In open court Tuesday, Mills and Allen admitted that they knowingly failed to report to the National Response Center the release of asbestos, in the form of thermal system insulation, or “pipe wrap,” that had been removed from the basement of buildings owned and operated by John Mills, as soon as they knew of the release.  According to the indictment, the defendants illegally removed and disposed of more than 260 linear feet of pipe wrap containing asbestos.  The defendants directed an employee to remove the asbestos containing pipe wrap without warning him or giving him adequate personal protective equipment.  They transported and caused others to transport that pipe wrap, which was in open bags, in the open bed of a pickup truck.

They further admitted that they conspired together to violate CERCLA.  The asbestos pipe wrap was deposited by the defendants in a UHaul-style box truck owned by Mills and a shed maintained by the Malone Department of Public Works in an effort to conceal the material from authorities.

Conspiracy to violate CERCLA carries a maximum penalty of five years in prison and a $250,000 fine.  The defendants are scheduled to be sentenced by in Albany on May 12, 2014.

The investigation was conducted by the Environmental Protection Agency Criminal Investigation Division and the New York State Department of Labor Asbestos Control Bureau with assistance from the New York State Department of Environmental Conservation, the Malone Police Department, and the Malone Department of Public Works.  The case is being prosecuted by Trial Attorneys Gary N. Donner and Lana N. Pettus, paralegal Puja Moozhikkattu, and litigation support specialist Elga Ozols of the Environmental Crimes Section of the U.S. Department of Justice’s Environment and Natural Resources Division.     

Today the Justice Department’s Civil Rights Division announced its letter of findings determining that prison officials at the Alabama Department of Corrections (ADOC) and the Julia Tutwiler Prison for Women (Tutwiler) violate women prisoners’ constitutional rights by failing to take reasonable steps to protect them from harm due to sexual abuse and sexual harassment caused by correctional staff.  Specifically, the Justice Department found that prison officials have long been on notice of the risks to women prisoners and have chosen to ignore them.  The findings also included a notice that the investigation will be expanded to examine allegations of additional constitutional violations.

The department found that women prisoners at Tutwiler live in a toxic environment with repeated and open sexual behavior.  The conduct to which women are exposed includes:  officers forcing women to engage in sexual acts with officers in exchange for basic sanitary supplies; male officers openly watching women shower or use the toilet; a staff facilitated “strip show”; a constant barrage of sexually offensive language; punishment of prisoners who report improper conduct; and encouraging improper sexual contact between prisoners.  The sexual abuse and harassment is grossly underreported due to insufficient staffing and supervision, inadequate policies and procedures, a heightened fear of retaliation and an inadequate investigative process. 

“Our investigation has revealed serious systemic operational deficiencies at Tutwiler that have exposed women prisoners to harm and serious risk of harm from staff-on-prisoner sexual abuse and sexual harassment,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division.  “These problems have been festering for years, and are well known to Alabama prison officials.  Remedying these deficiencies is critical to ensuring constitutionally protected treatment of women prisoners at Tutwiler and will promote public safety.” 

The department’s comprehensive investigation involved an in-depth review and analysis of documents, including policies and procedures, incident reports, investigative reports, orientation materials and staff training materials.  The department also interviewed prison officials and administrative and security staff, as well as current and former women prisoners. 

The expanded investigation will examine allegations of excessive use of force, constitutionally inadequate conditions of confinement, constitutionally inadequate medical and mental health care and discriminatory treatment based on national origin, sexual orientation and gender identity.  The department’s decision to expand its investigation of conditions at Tutwiler stemmed from the department’s review of information suggesting that the systemic deficiencies at Tutwiler that facilitated staff sexual misconduct may also lead to constitutionally inadequate conditions of confinement. 

“The department stands ready to work with the state of Alabama on solving the problems at Tutwiler,” said U.S. Attorney George L. Beck Jr. for the Middle District of Alabama.  “The report has identified a very serious and troubling situation at the facility.  Action needs to be taken immediately.  I am certain that Commissioner Thomas and the governor’s office will continue to cooperate in eradicating these deplorable conditions.”

The department commends Commissioner Kim Thomas and his staff for the cooperation they have shown, and for their receptivity to concerns raised, and looks forward to continuing to work with ADOC and Tutwiler officials in a collaborative manner on the expanded investigation and to resolve the existing findings expeditiously and under mutually agreeable terms. 

For more information on the Civil Rights Division, please visit www.justice.gov/crt

Four individuals were sentenced this week for their respective roles in trafficking the identities and corresponding identity documents of Puerto Rican U.S. citizens.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Rosa E. Rodríguez-Vélez of the District of Puerto Rico made the announcement. The sentencings took place in front of U.S. District Judge Gustavo A. Gelpí in the District of Puerto Rico.

Domingo Pablo Gutierrez, 52, a Guatemalan national formerly of Albertville, Ala., was sentenced today to serve 30 months in prison to be followed by three years of supervised release. Gutierrez agreed to forfeit $40,000 in proceeds and to be removed from the United States after the completion of his sentence. On Aug. 22, 2013, Gutierrez pleaded guilty in front of U.S. Magistrate Judge Bruce J. McGiverin of the District of Puerto Rico to one count of conspiracy to commit identification fraud and one count of conspiracy to commit human smuggling for financial gain.

On Jan. 21, 2014, Moises Lara-Ceballos, 38, a Mexican national formerly of Seymour, Ind., was sentenced to serve 54 months in prison to be followed by three years of supervised release. Lara-Ceballos agreed to forfeit $422,793 in proceeds and to be removed from the United States after the completion of his sentence. On Sept. 20, 2013, Lara-Ceballos pleaded guilty in front of U.S. Magistrate Judge Marcos E. López to one count of conspiracy to commit identification fraud, one count of aggravated identity theft, and one count of illegal reentry after deportation.

Juan Quero-Mendez, 28, a Mexican national formerly of Lilburn, Ga., was also sentenced on Jan. 21, 2014, to serve 36 months in prison and three years of supervised release. The court ordered the defendant to forfeit $17,180 in proceeds and to be removed from the United States after the completion of his sentence. On Sept. 20, 2013, Quero-Mendez pleaded guilty in front of U.S. Magistrate Judge Camille L. Vélez-Rive of the District of Puerto Rico to one count of conspiracy to commit identification fraud and one count of conspiracy to commit human smuggling for financial gain.

Adonis Ramirez-Segura, 54, a Dominican national and a legal permanent resident of Columbus, Ohio, was sentenced on Jan. 21, 2014, to serve 22 months in prison to be followed by three years of supervised release. On Sept. 20, 2013, Ramirez-Segura pleaded guilty in front of U.S. Magistrate Judge Camille L. Vélez-Rive to one count of conspiracy to commit identification fraud and one count of Social Security fraud.

The four defendants were charged in a superseding indictment returned by a federal grand jury in Puerto Rico on March 22, 2012. To date, 53 individuals have been charged for their roles in the identity trafficking scheme. All 49 arrested defendants have pleaded guilty and 36 defendants have been sentenced.

Court documents allege that individuals located in the Savarona area of Caguas, Puerto Rico, obtained Puerto Rican identities and corresponding identity documents. Other conspirators located in various cities throughout the United States allegedly solicited customers and sold Social Security cards and corresponding Puerto Rico birth certificates for prices ranging from $700 to $2,500 per set. The superseding indictment alleges that these identity brokers in the United States ordered the identity documents from the document suppliers in Savarona on behalf of their customers by making coded telephone calls. The conspirators are charged with using text messages, money transfer services, and express, priority or regular U.S. mail to complete their illicit transactions.

Court documents allege that some of the conspirators assumed a Puerto Rican identity themselves and used that identity in connection with the trafficking operation. Their customers generally obtained the identity documents to assume the identity of Puerto Rican U.S. citizens and to obtain additional identification documents, such as legitimate state driver’s licenses. Some customers allegedly obtained the documents to commit financial fraud and attempted to obtain a U.S. passport.

According to court documents, various identity brokers were operating in Rockford, DeKalb and Aurora, Ill.; Seymour, Columbus and Indianapolis, Ind.; Hartford, Conn.; Clewiston, Fla.; Lilburn and Norcross, Ga.; Salisbury, Md.; Columbus and Fairfield, Ohio; Dorchester, Lawrence, Salem and Worcester, Mass.; Grand Rapids, Mich.; Nebraska City, Neb.; Elizabeth, N.J.; Burlington and Hickory, N.C.; Hazelton and Philadelphia, Pa.; Houston; Abingdon and Albertville, Ala.; and Providence, R.I.

According to court documents, Quero-Mendez was an identity broker who operated in Lilburn, Ga.; Ramirez-Segura was an identity broker who operated in Columbus, Ohio; Lara-Ceballos was an identity broker who operated in Seymour, Ind.; and Gutierrez was an identity broker who operated in Albertville, Ala.

The charges are the result of Operation Island Express, an ongoing, nationally coordinated investigation led by the ICE Homeland Security Investigations’ (ICE-HSI) Chicago Office and USPIS, DSS and IRS-CI offices in Chicago, in coordination with the ICE-HSI San Juan Office and the DSS Resident Office in Puerto Rico. The Illinois Secretary of State Police; Elgin, Ill., Police Department; Seymour, Ind., Police Department; and Indiana State Police provided substantial assistance. The ICE-HSI Assistant Attaché office in the Dominican Republic and International Organized Crime Intelligence and Operations Center (IOC-2) as well as various ICE, USPIS, DSS and IRS-CI offices around the country provided invaluable support.

The case is being prosecuted by Trial Attorneys James S. Yoon, Hope S. Olds, Courtney B. Schaefer and Christina Giffin of the Criminal Division’s Human Rights and Special Prosecutions Section, with the assistance of the Criminal Division’s Asset Forfeiture and Money Laundering Section and the support of the U.S. Attorney’s Office for the District of Puerto Rico. The U.S. Attorney’s Offices in the Northern District of Illinois, Southern District of Indiana, District of Connecticut, District of Massachusetts, District of Nebraska, Middle District of North Carolina, Southern District of Ohio, Middle District of Pennsylvania, District of Rhode Island, Southern District of Texas and Western District of Virginia provided substantial assistance.

Potential victims and the public may obtain information about the case at: www.justice.gov/criminal/vns/caseup/beltrerj.html . Anyone who believes their identity may have been compromised in relation to this investigation may contact the ICE toll-free hotline at 1-866-DHS-2ICE (1-866-347-2423) and its online tip form at www.ice.gov/tipline . Anyone who may have information about particular crimes in this case should also report them to the ICE tip line or website.

Anyone who believes that they have been a victim of identity theft, or wants information about preventing identity theft, may obtain helpful information and complaint forms on various government websites including the Federal Trade Commission ID Theft Website, www.ftc.gov/idtheft . Additional resources regarding identity theft can be found at www.ojp.usdoj.gov/ovc/pubs/ID_theft/idtheft.html ; www.ssa.gov/pubs/10064.html ; www.fbi.gov/about-us/investigate/cyber/identity_theft ; and www.irs.gov/privacy/article/0,,id=186436,00.html .

The Justice Department and the Internal Revenue Service (IRS) announced today that on Jan. 21, 2014, a federal jury in Palm Beach, Fla., convicted Paul F. Wrubleski, a resident of Weston, Fla., of one count of corruptly impeding the due administration of the internal revenue laws and four counts of filing false claims for tax refunds.  Wrubleski was remanded into custody yesterday.

According to court documents and the evidence presented at trial, Wrubleski had a decade-long pattern of filing false documents with the IRS.  Wrubleski impeded the IRS by filing false W-4 forms that claimed he was exempt from income tax withholding and by filing false tax returns, including four tax returns that requested over $1.5 million in federal refunds.  Wrubleski also sent obstructive letters, tax returns and other false documents to the IRS between 1999 and 2010.  In addition, the indictment alleged and the evidence proved that Wrubleski filed for bankruptcy in 2006 in order to impede IRS collection actions.

Sentencing is scheduled for April 3, 2014.  Wrubleski faces a statutory maximum potential sentence of 23 years in prison and faces a fine of up to $1.2 million.

Assistant Attorney General Kathryn Keneally of the Tax Division commended the efforts of special agents of IRS – Criminal Investigation who investigated the case, as well as Tax Division Trial Attorneys Charles Edgar Jr. and Jed Silversmith, who prosecuted the case, with local assistance from the U.S. Attorney’s Office for the Southern District of Florida.

Additional information about the Tax Division and its enforcement efforts may be found at  www.justice.gov/tax .

The U.S. Justice Department released the following statement by department spokesman Brian Fallon in response to President Obama’s speech on U.S. signals intelligence:

“The Attorney General believes that the President’s reforms will further ensure that the proper balance is struck between the need to keep the nation safe and the need to safeguard our civil liberties. In the weeks ahead, the Justice Department will work closely with the intelligence community and other key administration officials to implement the President’s reforms.”

Contract therapy providers RehabCare Group Inc., RehabCare Group East Inc. and Rehab Systems of Missouri and management company Health Systems Inc. have agreed to pay $30 million to resolve claims that they violated the False Claims Act by engaging in a kickback scheme related to the referral of nursing home business, the Justice Department announced today. Additionally, as part of this settlement, the entities have agreed to restructure their business arrangement.

“Health care providers that attempt to profit from illegal kickbacks will be held accountable,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.  “We will continue to advocate for the appropriate use of Medicare funds and the proper care of our senior citizens.”

Between March 1, 2006, and Dec. 31, 2011, RehabCare allegedly arranged with Rehab Systems of Missouri to obtain Rehab Systems of Missouri ’s contracts to provide therapy to patients residing in 60 nursing homes controlled by Rehab Systems majority-owner James Lincoln. In exchange for this stream of referrals, RehabCare allegedly paid Rehab Systems a $400,000 to $600,000 upfront payment and allowed Rehab Systems to retain a percentage of the revenue generated by each referral.

“The Anti-Kickback Statute is intended to protect patients and federal health care programs from fraud and abuse,” said Acting U.S. Attorney for the District of Minnesota John Marti. “We will remain vigilant in pursuing entities that improperly further their financial interest at the expense of the Medicare Trust Fund.”

“This settlement sends a message to those who seek to improperly take advantage of the Medicare program,” said U.S. Department of Health and Human Services Office of Inspector General Special Agent in Charge Gerald T. Roy. “The Office of the Inspector General, Kansas City Regional Office will continue to work aggressively to eliminate this type of misconduct from our health care system.”

“The FBI will continue to work with its partners to combat this type of abuse,” said Special Agent in Charge of the FBI’s Minneapolis Office J. Chris Warrener. “It remains committed to the elimination of fraud to ensure the integrity of federal health care programs.”

This civil 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 Attorney General Eric Holder and Secretary of Health and Human Services Kathleen Sebelius.  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 more than $17.1 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.

The settlement resolves allegations originally brought in a lawsuit filed by a whistleblower under the qui tam provisions of the False Claims Act, which allow private parties to bring suit on behalf of the government and to share in any recovery.  The whistleblower will receive $5.7 million as its share of the recovery in this case.

The case was handled by the U.S. Attorney’s Office for the District of Minnesota with assistance from the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Eastern District of Missouri, the Federal Bureau of Investigation and the U.S. Department of Health and Human Services Office of Inspector General.  This action was supported by the Elder Justice and Nursing Home Initiative that coordinates the department’s activities combating elder abuse, neglect and financial exploitation, especially as they impact beneficiaries of Medicare, Medicaid and other federal health care programs. 

The lawsuit is captioned U.S. ex rel. Health Dimensions Rehabilitation Inc. v. RehabCare Group Inc., et. al., Case No. 4:12-cv-00848 AGF (E.D. Mo.). The claims settled by this agreement are allegations only; there has been no determination of liability. 

A patient recruiter for a fraudulent Miami-area mental health company, American Therapeutic Corporation (ATC), pleaded guilty today for her participation in a $190 million Medicare fraud scheme.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge Michael B. Steinbach of the FBI’s Miami Field Office and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Office of Investigations Miami Office made the announcement.

Miami resident Mayelin Santoyo, 28, pleaded guilty before U.S. District Judge K. Michael Moore in the Southern District of Florida to one count of conspiracy to receive health care kickbacks. Sentencing has been scheduled for March 28, 2014. On Nov. 25, 2013, co-defendant Jose Martin Olivares, 36, also a Miami resident and patient recruiter, pleaded guilty to one count of conspiracy to receive health care kickbacks before U.S. District Judge Donald L. Graham for his role in this scheme. Olivares’s sentencing is set for Feb. 4, 2014.

According to court documents, Santoyo was a patient recruiter for the now-defunct ATC. ATC and its management company, Medlink Professional Management Group Inc., were Florida corporations headquartered in Miami. ATC operated purported partial hospitalization programs (PHPs), a form of intensive treatment for severe mental illness, in seven different locations throughout South Florida and Orlando.

Santoyo recruited Medicare beneficiaries to attend ATC’s PHP program in exchange for kickbacks in the form of checks and cash. The amounts of the kickbacks were based on the number of days each recruited patient spent at ATC. Santoyo knew that the patients she recruited for ATC were not qualified to receive PHP treatment.

ATC’s owners and operators paid millions of dollars in kickbacks to the owners and operators of various assisted living facilities and halfway houses, as well as to patient recruiters, like Santoyo, in exchange for delivering ineligible patients to ATC. According to court documents, to obtain the cash required to support the kickbacks to recruiters such as Santoyo, the co-conspirators laundered millions of dollars of payments from Medicare.

In related cases, ATC, Medlink and various owners, managers, doctors, therapists and patient recruiters of ATC and Medlink have already pleaded guilty or have been convicted at trial. In September 2011, ATC’s owner, Lawrence Duran, was sentenced to 50 years in prison for his role in orchestrating and executing the scheme to defraud Medicare.

This case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. The case was prosecuted by Assistant Chief Robert A. Zink and Trial Attorney Anne P. McNamara 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 more than 1,700 defendants who have collectively billed the Medicare program for more than $5.5 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

Two men have been indicted by a federal grand jury in Las Vegas for offenses involving the federal renewable fuel program that allegedly netted them more than $37 million, announced the Justice Department’s Environment and Natural Resources Division, Criminal Division, and the U.S. Attorney’s Office for the District of Nevada. The 57-count indictment against James Jariv, 63, of Las Vegas, and Nathan Stoliar, 64, of Australia, includes allegations of conspiracy, wire fraud, false statements under the Clean Air Act, obstruction of justice and conspiracy to engage in money laundering.

The indictment was unsealed late Wednesday following Jariv’s initial appearance in federal court in Las Vegas, which followed his arrest on Tuesday. Stoliar resides in Australia.

The Energy Independence and Security Act of 2007 created a number of federally-funded programs that provided monetary incentives for the production of biodiesel and to encourage biodiesel use in the United States. Biodiesel producers and importers could generate and attach credits known as “renewable identification numbers” or RINs to biodiesel they produced or imported. Because certain companies need RINs to comply with regulatory obligations, RINs have significant market value. In addition, in order to create an incentive for biodiesel in the United States to be used in the United States, anyone who exports biodiesel is required to obtain these valuable RINs and provide them to EPA. The market price charged for exported biodiesel therefore includes the value an exporter is required to later spend to acquire these RINs.

The indictment alleges that beginning around June of 2009, the two defendants, James Jariv and Nathan Stoliar, operated and controlled a company -- City Farm Biofuel in Vancouver, British Columbia, Canada -- that held itself out as a producer of biodiesel from “feedstocks” such as animal fat and vegetable oils. Jariv also operated and controlled a company based in Las Vegas, Nevada, called Global E Marketing. The government alleges that these defendants claimed to produce biodiesel at the City Farm facility, claimed to import and sell biodiesel to Global E Marketing, and then generated and sold RINs based upon this claimed production, sale and importation. In reality, little to no biodiesel produced at City Farm was ever imported and sold to Global E Marketing as claimed. The indictment alleges that the defendants’ scheme allowed them to generate approximately $7 million in RINs that were fraudulent, which were then sold to companies that needed to obtain them.

The indictment also alleges that, beginning around the same time period and continuing through Dec. 31, 2013, the defendants, using their company MJ Biodfuels, bought over 23 million gallons of RIN-less biodiesel that had been blended with small amounts of petroleum diesel, known as B99, from companies in the United States. The defendants sold some of this biodiesel to purchasers in the United States, claiming it was pure biodiesel, known as B100, produced at the City Farm facility and imported into the United States. By claiming this biodiesel was B100 and not RIN-less B99, the defendants were able to claim the fuel was eligible to be used to generate credits and incentives, and were able to sell the fuel for significantly more than they otherwise would have been able. The defendants also exported the RIN-less B99 they bought in the United States to Canada. The defendants then sold the biodiesel in Canada, and conspired not to acquire and provide RINs for these exports to the United States as they were required to do, but instead to keep the money they received from the sales for themselves. The indictment alleges that, in doing so, the defendants failed to give to the United States RINs worth in excess of $30 million, keeping this money for themselves instead.

The indictment alleges that the defendants created false records and made false statements to conceal their fraudulent claims of biodiesel production, importation, sale and fraudulent RIN generation. Finally, the indictment alleges that the defendants engaged in a conspiracy to launder the proceeds of their crimes, utilizing foreign banking institutions and complex financial transactions to conceal the illegal nature of the funds they received, and to attempt to protect these funds from government enforcement. Today the United States also seized and restrained the assets contained in a number bank accounts utilized by the defendants, as well as several pieces of real and personal property in Las Vegas, Nevada.

An indictment is only a charge and is not evidence of guilt. All defendants are presumed innocent and are entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.

The collaborative investigation that led to today’s arrest and seizures was the result of work by the EPA’s Criminal Investigation Division and the FBI, with assistance from the United States Secret Service and the Department of Homeland Security.

The case is being prosecuted by Senior Trial Attorney Wayne D. Hettenbach of the Environmental Crimes Section of the Justice Department’s Environment and Natural Resources Division , Assistant U.S. Attorneys Crane M. Pomerantz and Daniel D. Hollingsworth of the U.S. Attorney’s Office in Nevada, and Trial Attorney Darrin L. McCullough of the Justice Department’s Criminal Division, Asset Forfeiture and Money Laundering Section, with the assistance of the Justice Department’s Office of International Affairs.

Koito Manufacturing Co. Ltd., a Tokyo-based company, has agreed to plead guilty and to pay a total of $56.6 million in criminal fines for its roles in separate price-fixing conspiracies involving automobile lighting fixtures and lamp ballasts installed in cars sold in the United States and elsewhere, the Department of Justice announced today.

 
A ccording to a two-count felony charge filed today in U.S. District Court for the Eastern District of Michigan in Detroit, Koito engaged in separate conspiracies to rig bids for, and to fix, stabilize and maintain the prices of automobile lighting fixtures and automotive high-intensity discharge (HID) lamp ballasts sold to automakers in the United States and elsewhere.  In addition to the criminal fine, Koito has also agreed to cooperate with the department’s ongoing auto parts investigations.  The plea agreement is subject to court approval.

 
“The conspirators engaged in long-term conspiracies to fix the prices of essential components used in the production of automobiles,” said Brent Snyder, Deputy Assistant Attorney General of the Antitrust Division’s criminal enforcement program.  “Today’s criminal fine demonstrates the Antitrust Division’s continued commitment to hold companies accountable for collusive behavior that impacts American consumers.”

 
According to the charges, Koito and its co-conspirators sold the lighting fixtures and ballasts at noncompetitive prices to automakers in the United States and elsewhere.  Koito and its co-conspirators carried out the conspiracies through meetings and conversations in which they discussed and agreed upon bids and price quotations and agreed to allocate among the companies certain sales of automotive lighting fixtures and HID lamp ballasts sold to automobile and component manufacturers.  Koito’s involvement in the conspiracy to fix prices of automotive lighting fixtures lasted from at least as early as June 1997 until about July 2011.  Koito’s involvement in the conspiracy to fix prices of automotive HID lamp ballasts lasted from at least as early as July 1998 until at least February 2010.

 
Koito manufactures and sells automotive lighting fixtures, which include automobile headlamps and rear combination lamp assemblies that employ various bulb technologies and are used for forward illumination, visibility and to signal various vehicular functions, such as braking, reversing direction and turning.

 
Koito also manufactures and sells HID lamp ballasts – electrical devices that are essential for the operation of an HID headlamp.  HID lamp ballasts regulate the electrical current used to ignite and control the electrical arc that generates the intensely bright light emitted by an automotive HID headlamp fixture.

Including Koito, 24 corporations have pleaded guilty or agreed to plead guilty in the department’s investigation into price fixing and bid rigging in the auto parts industry, and have agreed to pay a total of more than $1.8 billion in fines.  Additionally, 26 individuals have been charged.

Koito is charged with price fixing in violation of the Sherman Act, which carries a maximum penalty of a $100 million criminal fine for corporations.  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 prosecution arose from an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by each of the Antitrust Division’s criminal enforcement sections and the FBI.  Today’s charges were brought by the National Criminal Enforcement Section, with the assistance of the Detroit Field Office of the FBI and the FBI headquarters’ International Corruption Unit.  Anyone with information concerning this investigation 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 Detroit Field Office of the FBI at 313-965-2323.

            January 2014 has been proclaimed as National Slavery and Prevention and Awareness of Human Trafficking Month by President Barack Obama.  On January 10, 2014, Governor of Guam Eddie Baza Calvo and Governor Eloy S. Inos of the CNMI proclaimed “Stalking and Human Trafficking” month.  Communities nationwide join together to raise awareness about the ills of human trafficking, slavery and stalking. 

            The Guam Human Trafficking Task Force (HTTF) has organized the following events to commemorate Human Trafficking Awareness and Prevention Month in Guam:

• Friday January 17, 2014

• Wednesday, January 22, 2014

            The CNMI Human Trafficking Intervention Coalition has planned a community outreach for January 23, 2014, from 5:00 p.m. to 9:00 p.m. at the Thursday Night Market in Garapan, and a Human Trafficking Awareness Workshop on January 29, 2014, from 8:00 a.m. to 9:00 a.m. to be held at Commonwealth Health Care Corporation.

            The Guam Human Trafficking Task Force and the CNMI Human Trafficking Intervention Coalition comprised of representatives from federal and local law enforcement agencies, victim service providers, social service providers, medical and health professionals, faith based organizations, and other community partners, will continue to respond to the needs of human trafficking victims and their families and to hold offenders accountable.

            For more information about the events, please contact Mae Blas at (671) 477-4144 or via email at salome.blas@usdoj.gov.

Attached are photos taken at the Proclamation Signing in Guam and in the CNMI.


Guam photo of some of the Human Trafficking Task Force members, courtesy of Cynthia Cabot from the Guam Coalition Against Sexual
Assault & Family Violence.


CNMI photo of Human Trafficking Intervention Coalition, courtesy of
Angel Demapan from the CNMI Governor’s Office.

Four men have pleaded guilty for their roles in a highly sophisticated and violent organization that targeted jewelry couriers in Georgia and Texas. The defendants were caught as part of a national effort to find and prosecute roving groups of robbers who travel around the country targeting jewelry couriers and other business people.

Acting Assistant Attorney General Mythili Raman and U.S. Attorney Sally Quillian Yates of the Northern District of Georgia made the announcement.

Honorio Sanchez-Valencia, 46, of Gwinnett, Ga., and Jose Vicente Ramirez-Rodriguez, 38, John Rodriguez, 37, and Ali Alejandro Godoy-Maximo, 25, each of Los Angeles, Ca., pleaded guilty this week in the Northern District of Georgia to Hobbs Act robbery for participating in the robbery of a jewelry courier on Jan. 31, 2013, at a QuikTrip gas station in Buford, Ga. The charge carries a maximum penalty of 20 years in prison. In addition, Rodriguez pleaded guilty to being an illegal alien in possession of a handgun, which carries a maximum penalty of 10 years in prison. Sentencing has not been scheduled.

Court records show that on Jan. 31, 2013, as part of a plan to identify and rob a jewelry courier, the courier-victim was followed by Ramirez-Rodriguez to a QuikTrip gas station. As he was following the courier, Ramirez-Rodriguez contacted Sanchez-Valencia to help him with the robbery. Sanchez-Valencia, in turn, contacted the other defendants, all of whom came to the gas station together. When the courier was putting gas in his vehicle, two of the defendants approached him, with one restraining him with a knife while another smashed the vehicle window and took a briefcase containing over $125,000 in assorted jewelry.

Sanchez-Valencia also admitted his involvement in a similar robbery that occurred in Dallas on Aug. 27, 2012. In that robbery, two jewelry couriers were at a restaurant when Sanchez-Valencia briefly came into the restaurant to conduct surveillance on them and to determine the layout of the restaurant. Within a few minutes after Sanchez-Valencia left, three masked men with a gun came into the restaurant and robbed the jewelry couriers of two briefcases containing over $500,000 of jewelry. Some of that jewelry was recovered during the execution of a search warrant at a storage unit rented by Sanchez-Valencia.

This case was investigated by the FBI, ICE 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.

A former sergeant of the Portsmouth Sheriff’s Office (PSO) was sentenced to serve 15 months in prison today for accepting bribes in exchange for favors and referrals.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and Acting U.S. Attorney Dana J. Boente of the Eastern District of Virginia made the announcement.

Melvin Hike, 65, of Portsmouth, Va., was sentenced by U.S. District Judge Arenda L. Wright Allen of the Eastern District of Virginia. Hike was also sentenced to serve three years of supervised release and to pay a $10,000 fine.

On Oct. 8, 2013, Hike pleaded guilty to conspiracy and federal programs bribery. According to court documents, throughout the relevant time period of 2008 to 2012, Hike was a PSO sergeant assigned to the warrant squad. Ulysses Stephenson, aka “Tugger,” was a bail bondsman based in Portsmouth whose income depended on the number of arrestee clients he served. At various times between 2008 and 2012, Stephenson gave Hike cash payments and other items of value, and in exchange, Hike referred arrestees to Stephenson as prospective clients. Stephenson previously pleaded guilty to conspiracy and federal programs bribery in connection with bribing Hike, and he was sentenced to 30 months in prison on Nov. 2, 2012.

This case was investigated by the FBI. The case was prosecuted by Trial Attorneys Monique Abrishami and Peter Mason of the Criminal Division’s Public Integrity Section and Special Assistant U.S. Attorney Amy E. Cross of the Eastern District of Virginia.

David Haigler of Montgomery County, Ala., was sentenced today to serve 37 months in federal prison for his involvement in a stolen identity tax refund fraud scheme, Assistant Attorney General Kathryn Keneally of the Justice Department's Tax Division, U.S. Attorney George L. Beck Jr. for the Middle District of Alabama and the Internal Revenue Service (IRS) announced today.  Haigler was also ordered to serve three years of supervised release and to pay restitution to the IRS in the amount of $606,781.  Haigler previously pleaded guilty in the U.S. District Court for the Middle District of Alabama on Sept. 6, 2013.

According to court documents, between November 2011 and July 2012, Haigler obtained 263 fraudulent U.S. Treasury refund checks and Refund Anticipation Loan checks totaling $606,781.  The refund checks were in the names of different individuals and those individuals did not authorize Haigler to cash the checks.  Haigler obtained fictitious powers of attorney in the names of the individuals on the checks, which purportedly appointed Haigler to handle financial affairs, including the cashing of checks.  Haigler cashed all of the fraudulent refund checks at a store in Millbrook, Ala., and provided the store with copies of the ficticious powers of attorney.  Haigler retained a portion of the checks and provided the remainder to the individuals who brought him the fraudulent checks.

This case was investigated by special agents of the IRS - Criminal Investigation and the U.S. Secret Service.  Trial Attorneys Michael Boteler and Jason Poole of the Tax Division and Assistant U.S. Attorney Todd Brown prosecuted the case.

Additional information about the Justice Department's Tax Division and its enforcement efforts may be found at  www.justice.gov/tax

Russell Burroughs, a resident of Montgomery, Ala., was indicted on 33 counts of filing false tax returns, Assistant Attorney General Kathryn Keneally of 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 yesterday.

According to the indictment, Burroughs owned and operated Computer Services, a tax return business located in Montgomery, Ala.  Burroughs allegedly prepared and filed 33 false tax returns.  The indictment alleges that the false items on the tax returns included false energy and education credits, false deductions and other false information.

An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt.  If convicted, Burroughs faces a statutory maximum potential sentence of three years in prison for each count of filing a false return. 

The case was investigated by special agents of the Internal Revenue Service - Criminal Investigation.  Trial Attorneys Charles Edgar Jr., Katherine Reinhart and Michael Boteler of the Tax Division are prosecuting the case with the assistance of Assistant U.S. Attorney Todd Brown and the U.S. Attorney’s Office for the Middle District of Alabama. 

Sasha Webb and Charlie Jackson have each been indicted for stolen identity refund fraud crimes, Assistant Attorney General Kathryn Keneally of 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 their indictments after their arrests.  Webb was arrested on Dec. 20, 2013, and Jackson’s arrest took place on Jan. 15, 2014.

Webb was charged with conspiracy to file false claims, mail fraud and aggravated identity theft.  According to the indictment, Webb worked as a medical records clerk at an Alabama Department of Corrections facility in Elmore County, Ala.  Webb had access to the means of identification of inmates and sold the information to Jacqueline Slaton and Harvey James, who then used the inmates’ information to file hundreds of false tax returns that claimed over one million dollars in false refunds.  Slaton and James knowingly paid Webb for stolen identities. 

Charlie Jackson, a resident of Montgomery, Ala., was charged with wire fraud and aggravated identity theft.  According to the indictment, between October 2010 and April 2013, Jackson obtained stolen identities and used those identities to file false tax returns.  Jackson directed the tax refunds to prepaid debit cards in the names of other individuals. 

An indictment merely alleges that crimes have been committed and the defendant is presumed innocent until proven guilty beyond a reasonable doubt.  If convicted, Jackson and Webb each face a statutory maximum potential sentence of 20 years in prison for each wire and mail fraud count and a statutory mandatory two-year sentence for the aggravated identity theft counts.  Webb also faces a statutory maximum potential sentence of five years in prison for the conspiracy count.   Both defendants are also subject to fines, forfeiture and mandatory restitution if convicted.

The cases were investigated by special agents of the Internal Revenue Service - Criminal Investigation, U.S. Postal Inspectors and the Elmore County Sheriff’s Office.  Trial Attorneys Jason Poole, Charles Edgar Jr. and Michael Boteler of the  Tax Division are prosecuting the cases with the assistance of Assistant U.S. Attorney Todd Brown and the U.S. Attorney’s Office for the Middle District of Alabama. 

Granville Robinson, 25, aka Bear and HB, Duane Phillips, 28, aka P-nut, and Anthony Ellis, 25, aka Anthony Deshun Lloyd, Animal and AD, were arrested today for offenses related to their involvement in sex trafficking adult victims to New Orleans as charged in a five-count indictment dated Dec. 20, 2013, and unsealed today by Chief Judge Sarah S. Vance of the U.S. District Court for the Eastern District of Louisiana, announced Acting Assistant Attorney General Jocelyn Samuels for the Justice Department’s Civil Rights Division and U.S. Attorney Kenneth Allen Polite Jr. for the Eastern District of Louisiana.  Robinson, Phillips and Ellis are from Memphis, Tenn.

According to the indictment, from May 20, 2013, until Dec. 20, 2013, Robinson, Phillips and Ellis conspired to recruit, entice, harbor and transport several adult women by means of force, threats of force, fraud and coercion in order to engage in commercial sex acts in New Orleans and elsewhere.  In addition to being charged with conspiring to commit sex trafficking, Robinson and Phillips are each charged with a substantive count of sex trafficking by force, fraud or coercion, and with transporting women in interstate commerce for the purpose of prostitution between May 20, 2013, and July 2, 2013.

If convicted of conspiracy to commit sex trafficking and sex trafficking by force, fraud or coercion, Robinson, Phillips and Ellis each face a statutory maximum sentence of life imprisonment, a $250,000 fine and a lifetime of supervised release.  Robinson and Phillips face a statutory maximum of 10 years in prison, a $250,000 fine and three years of supervised release if convicted of transportation for the purpose of prostitution.

An indictment is merely an accusation, and the defendants are presumed innocent unless proven guilty.

This case was investigated by agents from the New Orleans Field Offices of the FBI and the Department of Homeland Security, as well as the Memphis Field Office of the FBI.  The prosecution of this case is being handled by Special Litigation Counsel John Cotton Richmond and Trial Attorney Christine M. Siscaretti of the Civil Right Division’s Human Trafficking Prosecution Unit along with Assistant U.S. Attorney Julia K. Evans of the Eastern District of Louisiana.

SACRAMENTO, Calif. - El procurador federal Benjamin B. Wagner y el Jefe  Adjunto Inspector Postal para las Operaciones del Campo Occidental Dr. Gregory Campbell Jr. anunciaron los resultados obtenidos hasta el momento por la Operación Buzón Roto, un esfuerzo continuo en el que participa una creciente cantidad de inspectores postales y analistas trabajando en colaboración con las fuerzas del orden público para investigar y procesar infracciones de correo robado.

La Operación Buzón comenzó luego de las quejas de un cliente postal sobre ladrones de correo que estaban atacando buzones de recolección por medio de técnicas de “pesca”, fisgoneando buzones abiertos en los vestíbulos de las oficinas postales, irrumpiendo en camiones de repartición de correo y falsificando llaves postales para poner en peligro los buzones de recolección y Unidades de Buzones de Entrega Centralizada de Barrio (NDCBUs). El Servicio de Inspección Postal ocupó en el Distrito Oriental de California a inspectores postales y analistas de todo el país con fuerte experiencia en investigación de robo de correo para que comenzaran en abril de 2013 a trabajar con inspectores postales ya asignados a Sacramento, Fresno y Bakersfield.

En menos de un año, los equipos completaron las investigaciones que llevaron a la imputación de cargos contra 21 acusados.  Nueve de estos acusados ya han sido sentenciados y seis màs estàn esperando la sentencia después de declararse culpables. Adicionalmente, al menos otras seis personas han sido acusadas por fiscales en los condados de Kern y de Sacramento.  La Operación Buzón Roto continúa en marcha y se esperan màs acusaciones.

“Proteger la seguridad del correo de los Estados Unidos y proteger a los clientes del correo de la pérdida de objetos valiosos e información de identidad personal es una responsabilidad importante del Servicio de Inspección Postal de los Estados Unidos y de su oficina”, dijo el procurador Wagner.  “Aprecio la receptividad que el Servicio de Inspección Postal ha mostrado en entregar recursos para abordar este problema en el Central Valley.  También quiero agradecer a nuestros socios de las fuerzas del orden público por trabajar de una manera tan efectiva con nosotros en este esfuerzo”.

El jefe adjunto inspector postal Campbell afirmó:  “Trabajamos de cerca con la Procuraduría y con nuestros socios en la fuerza de orden público para arrestar y procesar a quienes roban correo con fines criminales.  Una meta principal para el Servicio de Inspección Postal es proteger el correo de los clientes postales y asegurar que su correo se encuentre a salvo de robo”.

Entre los casos que surgieron durante la operación se encuentran los siguientes:

• Sacramento: Los inspectores postales aseguraron la imputación de cargos a tres acusados que obtuvieron correo robado tras forzar las NDCBU en Elk Grove y Sacramento.  Una de las acusadas usó su trabajo como vendedora en un establecimiento para abrir cuentas fraudulentas y usar la información de cuentas que obtuvo de correo robado.  Los inspectores postales también aseguraron la imputación de cargos de otros cinco acusados que forzaron en Rancho Cordova, Elverta, Rocklin, Roseville, Natomas, Rio Linda, Elkhorn y Antelope.  Varias órdenes de registro resultaron en la recuperación de cientos de piezas de correo robado y llaves postales robadas.

• Fresno: Los inspectores postales llevaron a cabo el registro a un reincidente que se encontraba en libertad bajo palabra y que presuntamente està involucrado en forzar NDCBU en Fresno y Madera, y recuperaron correo robado y seis llaves postales falsificadas.

• Bakersfield: Los inspectores postales identificaron un grupo que pescaba buzones de recolección y llevaron a cabo vigilancia que dio como resultado el arresto de tres acusados por robo de correo. Los registros subsecuentes a los arrestos recuperaron un gran volumen de correo robado y varias llaves postales.  La investigación resultó en la imputación de cinco sospechosos.

A la fecha, la Operación Buzón Roto dio como resultado al menos 22 arrestos, 33 registros, la recuperación de diez llaves robadas o falsificadas y la identificación de màs de 2,100 víctimas y casi $400,000 en pérdidas.  El Servicio de Inspección Postal trabajó de cerca con varias agencias del orden público, incluyendo el Departamento de Policía de Sacramento, el Departamento de Polícia de Bakersfield, el Departamento de Polícia de Elk Grove, la Oficina del Alguacil del Condado de Kern y la Oficina del Alguacil del Condado de Placer.  El trabajo de la Operación Buzón Roto continúa.

SACRAMENTO, Calif. - En octubre y noviembre de 2011, fueron interpuestas demandas en cada uno de los cuatro distritos judiciales federales de California buscando detener la ejecución federal de la Ley de Sustancias Controladas contra los dispensarios de marihuana sobre una variedad de fundamentos.  Las demandas alegaban que el gobierno federal no podría tomar medidas legales contra los dispensarios porque esa acción es una violación a la Novena y la Décima Enmienda, la Claúsula de Protección de Igualdad y la Claúsula del Comercio.  Con procesos judiciales separados en cada distrito, cada uno de los cuatro jueces de los tribunales distritales emitió órdenes desestimando los casos.  Los demandantes en tres de esos casos apelaron esas decisiones.  Hoy, en un dictamen no publicado, el Circuito Noveno afirmó las desestimaciones de los tres casos.

La Corte del Distrito Oriental de California fue la primera corte distrital en rechazar las demandas de los dispensarios.  La acción en el Distrito Oriental fue interpuesta a finales de 2011 por el Sacramento Nonprofit Collective, haciendo negocios como El Camino Wellness Center y Ryan Landers.  Fue desestimada por el juez de la Corte del Distrito de Los Estados Unidos, Garland E. Burrell Jr., el 28 de febrero de 2012.

Benjamin Wagner, procurador federal del Distrito Oriental de California dijo:  “Nuestra responsabilidad como procuradores es hacer cumplir la Ley de Sustancias Controladas.  La decisión de hoy rechazando la demanda del dispensario es una aplicación directa del precedente existente, que solamente confirma que la Ley de Sustancias Controladas continúa estando vigente y vàlida, pese a la ley estatal”.

En la Corte del Distrito de California del Sur, la demanda interpuesta por Alternative Community Health Care Cooperative Inc, fue desestimada el 5 de marzo de 2012 por la juez de la Corte del Distrito de los Estados Unidos Dana M. Sabraw. Laura E. Duffy, la procuradora federal del Distrito del Sur de California dijo: “ La decisión del Noveno Circuito reconoce que los procuradores conservan  el derecho de hacer cumplir la Ley de Sustancias Controladas.  Continuaremos enfocàndonos en los intereses federales de evaluar los procesos por marihuana en el Distrito de California del Sur, y colaboraremos con nuestro estado y con socios locales para asegurar la seguridad de nuestras comunidades”.

El caso del Noveno Circuito es Sacramento Nonprofit Collective v. Titular   Caso No. 12-15991.

A jury in the Middle District of Georgia convicted Kimberly Michelle Banks on Jan. 14, 2014, of conspiring to file false federal income tax returns in the names of stolen identities, the Justice Department and Internal Revenue Service (IRS) announced today.  Banks was also convicted of wire fraud, aggravated identity theft and theft of government money.

According to evidence introduced at trial, Banks obtained the names and Social Security numbers of nursing home patients from her employer and conspired with Donalene Mosely, Arneshia Austin and others to use the stolen identifying information to steal money from the government.  Mosely and Austin each pleaded guilty to related charges before trial.  Several victims testified that they did not consent to the use of their names and Social Security numbers on these tax returns and testified that they did not receive any money from refunds generated from the false tax returns filed with the IRS.  The tax returns at issue were filed from two internet protocol addresses assigned to Banks, and the fraudulent tax refunds were deposited onto prepaid debit cards mailed to addresses belonging to Banks and others, including Mosely and Austin.  The evidence also revealed that Banks and others used the stolen proceeds to make payments on their car loans, to throw a party and to buy products online. 

The court has not yet scheduled sentencing for Banks, Mosely or Austin.  Banks faces a statutory minimum of two years in prison for aggravated identity theft, a statutory maximum of 20 years in prison for each wire fraud count and 10 years in prison for each theft of government money count.  Banks, Mosely and Austin each face a statutory maximum of five years in prison for the conspiracy count.  

This case was investigated by IRS-Criminal Investigation and is being prosecuted by Trial Attorneys Justin Gelfand, Kimberly Shartar and Alexander Effendi for the Tax Division.  Assistant Attorney General Kathryn Keneally thanked the U.S. Attorney’s Office in the Middle District of Georgia and the Crisp County Sheriff’s Office for their assistance with this prosecution.

Two former Miami real estate agents were sentenced today for their roles in a $2.4 million mortgage fraud scheme, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division.

Jose Filgueiras, 43, was found guilty at trial on Sept. 9, 2013, of three counts of bank fraud and was sentenced by U.S. District Judge William J. Zloch of the Southern District of Florida to serve 57 months in prison. Jose Filgueiras’s wife, Raquel Filgueiras, 39, was found guilty at trial on the same day of one count of bank fraud and was sentenced by Judge Zloch to serve 30 months in prison.

Three co-conspirators in the case were sentenced on Nov. 12, 2013. Jose Armando Alvarado, a former Miami area real estate agent and mortgage broker and Raquel Filgueiras’s father, was sentenced to serve 135 months in prison. Alberto Morejon, a former loan closer and title agent, was sentenced to serve 36 months in prison. Alvarado’s sister, Reyna Orts, a former mortgage broker and the mother of Morejon, was sentenced to serve 50 months in prison. Each of the co-defendants was convicted at trial of various counts of wire and bank fraud.

According to court documents and evidence presented at trial, Alvarado, along with his co-conspirators, operated a mortgage fraud scheme by controlling and operating three real estate entities in the Miami area: South Florida Realty; American Mortgage Lending, a mortgage broker; and Royal Atlantic Title, a title insurance agency.  From February 2004 through November 2009, Alvarado and his co-conspirators used their control over these three companies to falsify and misrepresent important facts provided to financial institutions in order to fraudulently secure loans totaling more than $2.4 million.  The loans were often obtained through submitting falsified supporting documentation, such as false tax returns, W2 forms, bank statements and employment verifications.

Evidence at trial showed that Alvarado and his co-conspirators subsequently enriched themselves by diverting loan proceeds, collecting brokerage fees and inflating real estate commissions generated by the sales of the properties.  Alvarado and his co-conspirators obtained control of multiple properties during the real estate market boom with the intent to flip and sell them for a profit or control them as rental properties.  The defendants used their knowledge and experience in the real estate industry to conceal the scheme by executing quit-claim deeds and failing to record, and falsely recording, mortgage deeds and other documentation with the State of Florida.

The case was investigated by the FBI’s Miami Field Office and the Miami-Dade Police Department. The case was prosecuted by Trial Attorney N. Nathan Dimock of the Criminal Division’s Fraud Section.

NEW YORK - U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) returned three recovered sculptures, valued at more than $1.5 million, to the government of India Tuesday during a repatriation ceremony at the consulate in New York City. One of the objects - a 350-pound sandstone sculpture stolen from an Indian temple in 2009 - was listed as one of INTERPOL's top 10 most wanted stolen works of art.

HSI Executive Associate Director James A. Dinkins presented the artifacts to Consul General of India Dnyaneshwar M. Mulay, alongside INTERPOL Washington Director Shawn Bray.

“The excellent international cooperation between the United States and India led to the recovery and return of these priceless antiquities,” said Dinkins. “The pilfering of a nation's cultural patrimony cannot and will not be tolerated.”

“Prevention of illegal trade in antiquities has emerged as an important area of cooperation between India and the United States as can be seen from this recent recovery of stolen Indian antiquities,” said Mulay. “I deeply appreciate the excellent work done by ICE HSI in getting these three priceless Indian assets recovered. The successful investigations and repatriation of these cultural artifacts underscores the importance of growing institutional partnership, which is of great significance to both countries.”

“There is no better example of what can be accomplished through the collaboration between US and international law enforcement via INTERPOL than the astounding results of this investigation, which have led to today's repatriation of these artifacts to their rightful place with the people of India,” said Bray. “INTERPOL Washington is proud to have been able to assist ICE Homeland Security Investigations in obtaining the documentation and images necessary to help identify the objects as those stolen from India.”

Two of the three artifacts returned to India were reported in 2009 by the Archaeological Survey of India (ASI), who notified the Indian Consulate about two sandstone sculptures stolen from the Gadgach Temple in Atru, Rajasthan, India. The 350-pound “Vishnu and Lakshmi” sandstone sculpture dates back to the 11th or 12th century and was listed as No. 6 on INTERPOL's top 10 most wanted works of art. Also stolen from the temple and repatriated during the Jan. 14 ceremony was the 600-pound “Vishnu and Parvati” sandstone sculpture, dating to the same period.

The third artifact is a male deity black sandstone sculpture, depicting a Bodhisattva, a popular subject in Buddhist art, and is believed to date back to the 11th or early 12th century from either the Indian State of Bihar or Bengal.

The investigation that led to this repatriation began April 13, 2010, when HSI New York special agents received information that the Indian sandstone sculptures recently looted from India were being offered for sale in the United States. HSI special agents discovered that the “Vishnu and Lakshmi” was transported from India to Hong Kong. From there, it was sold to a dealer in Thailand, and then resold to a buyer in London. The London buyer shipped the sculpture to New York City for an exhibition in March 2010. On April 15, 2010, HSI special agents recovered the piece while it was being shipped back to London.

On July 12, 2010, as a direct result of the “Vishnu and Lakshmi” seizure, a sister piece, the “Vishnu and Parvati,” was seized. It was transported to Hong Kong, sold to a buyer in New York and then sold and shipped to a buyer in Basel, Switzerland.

On July 7, 2011, the Indian black stone Bodhisattva figure was discovered being smuggled into the United States at Newark Airport by U.S. Customs and Border Protection officers. HSI special agents seized it after discovering that its accompanying paperwork declared Great Britain as a false country of origin. In addition, the item was grossly undervalued.

The New York County District Attorney's Office assisted in this investigation.

The last ICE cultural property repatriation to India was in 2006 when ICE agents in NY returned a ninth century stone idol that had been stolen from a temple in Mandsaur in Madhya Pradesh in 2000.

HSI plays a leading role in criminal investigations that involve the illegal importation and distribution of cultural property, including the illicit trafficking of cultural property, especially objects that have been reported lost or stolen. The HSI Office of International Affairs, through its 67 attaché offices in 48 countries, works closely with foreign governments to conduct joint investigations, when possible.

HSI specially trained investigators, assigned to both domestic and international offices, partner with governments, agencies and experts to protect cultural antiquities. They also provide cultural property investigative training to law enforcement partners for crimes involving stolen property and art, and how to best enforce the law to recover these items when they emerge in the marketplace.

Since 2007, more than 7,150 artifacts have been returned to 26 countries, including paintings from France, Germany, Poland and Austria, 15th to 18th century manuscripts from Italy and Peru, as well as cultural artifacts from China, Cambodia and Iraq.

Learn more about HSI cultural property, art and antiquities investigations. Members of the public who have information about suspected stolen cultural property are urged to call the toll-free HSI tip line at 1-866-DHS-2-ICE or to complete its online tip form.

The Justice Department and the Internal Revenue Service (IRS) announced today that Jimmie Duane Ross, of Lehi, Utah, and formerly of Sevierville, Tenn., was sentenced to serve 51 months in prison based on his Aug. 7, 2013 conviction of five counts of tax evasion following a jury trial.  The U.S. District Court for the Eastern District of Tennessee also sentenced Ross to serve three years of supervised release following his prison term and ordered him to pay restitution of $532,389.

According to the indictment and evidence produced at trial, Ross won a monetary award of approximately $840,000 in 1999 after arbitration of an employment dispute with a former employer.  Ross then proceeded to file a false mortgage on his residence, file a false lien on his vehicle, deal extensively in cash and direct funds to an offshore account in order to evade paying the full amount he owed in income tax for 1999.  In addition, from 2004 through 2007, Ross earned commission income for referring clients to what appeared to be an investment company based in Nevis and evaded his taxes by using nominees and other means.

The case was investigated by IRS-Criminal Investigation and was prosecuted by Trial Attorneys Kevin Lombardi and Kimberly Shartar of the Tax Division.

Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at www.justice.gov/tax .

A former Lorain County, Ohio, corrections officer was sentenced today to serve 18 months in prison followed by two years of supervised release after previously pleading guilty to one count of deprivation of rights under color of law, announced Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division, U.S. Attorney Steven M. Dettelbach for the Northern District of Ohio and Special Agent in Charge Stephen D. Anthony of the FBI’s Cleveland Office.

Marlon Taylor, 47, of Vermilion, Ohio, was working as a corrections officer in Lorain County Jail on July 29, 2012, when he assaulted an inmate by striking him repeatedly, according to court documents.

These actions caused bodily injury to the inmate and deprived the inmate of the right to be free from cruel and unusual punishment, according to court documents.

"Uses of excessive force by corrections officers undermine our system of justice and the rule of law,” said Acting Assistant Attorney General Samuels.  “Today's sentence reflects that the Department of Justice will aggressively protect the constitutional rights of every American."

“The vast majority of law enforcement officials do a great job,” said U.S. Attorney Dettelbach.  “When someone abuses the power and privileges of their office, however, they can and will be held accountable.”

“Marlon Taylor is not representative of the vast majority of the honorable men and women serving within the criminal justice system,” said Special Agent in Charge Anthony.  “Any allegation of abuse or excessive force involving law enforcement officers takes on a particular sense of urgency and will continue to be a priority for the FBI.”

This investigation has been conducted by the FBI’s Cleveland Office.  Assistant U.S. Attorneys Antoinette T. Bacon and Lauren Bell and Trial Attorney Betsy Biffl prosecuted the case.

Two former Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. (Rabobank) Japanese Yen derivatives traders and the trader responsible for setting Rabobank’s Yen London InterBank Offered Rate (LIBOR) were charged as part of the ongoing criminal investigation into the manipulation of LIBOR.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, Deputy Assistant Attorney General Brent Snyder of the Justice Department’s Antitrust Division and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.

Earlier today, a U.S. Magistrate Judge sitting in the Southern District of New York signed a criminal complaint charging Paul Robson of the United Kingdom, Paul Thompson of Australia, and Tetsuya Motomura of Japan with conspiracy to commit wire fraud and bank fraud as well as substantive counts of wire fraud. All are former employees of Rabobank, which on Oct. 29, 2013, entered into a deferred prosecution agreement with the Department of Justice as part of the department’s LIBOR investigation and agreed to pay a $325 million penalty. Each defendant faces up to 30 years in prison for each count upon conviction.

“Today, less than three months after Rabobank admitted its involvement in the manipulation of LIBOR, we have charged three of its senior traders with participating in this global fraud scheme,” said Acting Assistant Attorney General Raman.  “As alleged, these three traders – working from Japan, Singapore and the U.K. – deliberately submitted what they called ‘obscenely high’ or ‘silly low’ LIBOR rates in order to benefit their own trading positions.  The illegal manipulation of this cornerstone benchmark rate undermines the integrity of the markets; it harms those who are relying on what they expect to be an honest benchmark; and it has ripple effects that extend far beyond the trading at issue here.  The Justice Department has now charged eight individuals and reached resolutions with four multi-national banks as part of our ongoing and industry-wide LIBOR probe and, alongside our law enforcement and regulatory partners both here and abroad, we remain committed to continuing to root out this misconduct.”

“The conspirators charged today conspired to rig the interest rates used by derivative products throughout the financial industry to benefit their own trading books,” said Deputy Assistant Attorney General Snyder. “Today’s charges demonstrate the department’s commitment to hold individuals accountable for schemes that undermine the integrity of markets that rely on competition to flourish.”

“Manipulation of benchmark rates that are routinely referenced by financial products around the world erodes the integrity of our financial markets,” said Assistant Director in Charge Parlave. “The charges against these individuals represent another step in our ongoing efforts to find and stop those who hide behind complex corporate and securities fraud schemes. I commend the Special Agents, forensic accountants and analysts as well as the prosecutors for the significant time and resources they committed to investigating this case.”

According to the complaint, LIBOR is an average interest rate, calculated based on submissions from leading banks around the world, reflecting the rates those banks believe they would be charged if borrowing from other banks. LIBOR is published by the British Bankers’ Association (BBA), a trade association based in London. At the time relevant to the criminal complaint, LIBOR was calculated for 10 currencies at 15 borrowing periods, known as maturities, ranging from overnight to one year. The published LIBOR “fix” for Yen LIBOR at a specific maturity is the result of a calculation based upon submissions from a panel of 16 banks, including Rabobank.

LIBOR serves as the primary benchmark for short-term interest rates globally and is used as a reference rate for many interest rate contracts, mortgages, credit cards, student loans and other consumer lending products. The Bank of International Settlements estimated that as of the second half of 2009, outstanding interest rate contracts were valued at approximately $450 trillion.

According to allegations in the complaint, all three defendants traded in derivative products that referenced Yen LIBOR. Robson worked as a senior trader at Rabobank’s Money Markets and Short Term Forwards desk in London; Thompson was Rabobank’s head of Money Market and Derivatives Trading Northeast Asia and worked in Singapore; and Motomura was a senior trader at Rabobank’s Tokyo desk who supervised money market and derivative traders employed at Rabobank’s Tokyo desk. In addition to trading derivative products that referenced Yen LIBOR, Robson also served as Rabobank’s primary submitter of Yen LIBOR to the BBA.

Robson, Thompson and Motomura each entered into derivatives contracts containing Yen LIBOR as a price component . The profit and loss that flowed from those contracts was directly affected by the relevant Yen LIBOR on certain dates. If the relevant Yen LIBOR moved in the direction favorable to the defendants’ positions, Rabobank and the defendants benefitted at the expense of the counterparties. When LIBOR moved in the opposite direction, the defendants and Rabobank stood to lose money to their counterparties.

The complaint alleges that from about May 2006 to at least January 2011, Robson, Thompson, Motomura and others agreed to make false and fraudulent Yen LIBOR submissions for the benefit of their trading positions. According to the allegations, sometimes Robson submitted rates at a specific level requested by a co-defendant and consistent with the co-defendant’s trading positions. Other times, Robson made a higher or lower Yen LIBOR submission consistent with the direction requested by a co-defendant and consistent with the co-defendant’s trading positions. On those occasions, Robson’s manipulated Yen LIBOR submissions were to the detriment of, among others, Rabobank’s counterparties to derivative contracts.

In addition to allegedly manipulating Rabobank’s Yen LIBOR submissions, Robson, on occasion and on behalf of one or more co-defendants, coordinated his Yen LIBOR submission with the trader responsible for making Yen LIBOR submissions at another Yen LIBOR panel bank. At times, Robson allegedly submitted Yen LIBOR at a level requested by the other trader, and, at other times, that trader submitted Yen LIBOR at a level requested by Robson.

As alleged in the complaint, Thompson, Motomura and another Rabobank trader described in the complaint as Trader-R made requests of Robson for Yen LIBOR submissions through electronic chats and email exchanges. For example, on May 19, 2006, after Thompson informed Robson that his net exposure for his 3-month fixes was 125 billion Yen, he requested by email that Robson “sneak your 3m libor down a cheeky 1 or 2 bp” because “it will make a bit of diff for me.” On or about May 19, 2006, Robson responded: “No prob mate I mark it low.”

On Sept. 21, 2007, Trader-R asked Robson by email, “where do you think today’s libors are? If you can I would like 1mth higher today.” Robson responded, “bookies reckon .85,” to which Trader-R replied, “I have some fixings in 1mth so would appreciate if you can put it higher mate.” Robson answered, “no prob mate let me know your level.” After Trader-R asked for “0.90% for 1mth,” Robson confirmed, “sure no prob[ ] I’ll probably get a few phone calls but no worries mate… there’s bigger crooks in the market than us guys!”

As another example, on Aug. 4, 2008, in a Bloomberg chat, Motomura asked Robson, “Please set today’s 6mth LIBOR at 0.96 I have chunky fixing.”  To this, Robson responded, “no worries mate.”

The complaint alleges that Robson accommodated the requests of his co-defendants. For example, on Sept. 21, 2007, after Robson received a request from Trader-R for a high 1 month Yen LIBOR, Rabobank submitted a 1-month Yen LIBOR rate of 0.90, which was 7 basis points higher than the previous day and 5 basis points above where Robson said that “bookies” predicted it, and which moved Rabobank’s submission from the middle to the highest of the panel.

According to court documents, the defendants were also aware that they were making false or fraudulent Yen LIBOR submissions. For example, on May 10, 2006, Robson admitted in an email that “it must be pretty embarrassing to set such a low libor. I was very embarrassed to set my 6 mth – but wanted to help thomo [Thompson]. tomorrow it will be more like 33 from me.” At times, Robson referred to the submissions that he submitted on behalf of his co-defendants as “ridiculously high” and “obscenely high,” and acknowledged that his submissions would be so out of line with the other Yen LIBOR panel banks that he might receive a phone call about them from the BBA or Thomson Reuters.

A criminal complaint is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless and until convicted.

The investigation is being conducted by special agents, forensic accountants, and intelligence analysts in the FBI’s Washington Field Office. The prosecution is being handled by Trial Attorneys Carol L. Sipperly, Brian Young and Alexander H. Berlin of the Criminal Division’s Fraud Section, and Trial Attorneys Ludovic C. Ghesquiere and Michael T. Koenig of the Antitrust Division. Former Deputy Chief Glenn Leon and Senior Counsel Rebecca Rohr of the Criminal Division’s Fraud Section, along with Assistant Chief Elizabeth Prewitt and Trial Attorneys Eric Schleef and Richard Powers of the Antitrust Division, have also provided valuable assistance. The Criminal Division’s Office of International Affairs has provided assistance in this matter as well.

The broader investigation relating to LIBOR and other benchmark rates has required, and has greatly benefited from, a diligent and wide-ranging cooperative effort among various enforcement agencies both in the United States and abroad. The Justice Department acknowledges and expresses its deep appreciation for this assistance. In particular, the Commodity Futures Trading Commission’s Division of Enforcement referred this matter to the department and, along with the U.K. Financial Conduct Authority, has played a major role in the LIBOR investigation. The department has worked closely with the Dutch Public Prosecution Service and the Dutch Central Bank in the investigation of Rabobank. Various agencies and enforcement authorities from other nations are also participating in different aspects of the broader investigation relating to LIBOR and other benchmark rates, and the department is grateful for their cooperation and assistance. In particular, the Securities and Exchange Commission has played a significant role in the LIBOR series of investigations, and the department expresses its appreciation to the United Kingdom’s Serious Fraud Office for its assistance and ongoing cooperation.

This prosecution is part of efforts underway by President Barack Obama’s Financial Fraud Enforcement Task Force.  President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.  The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.gov.

Rakecia Matrese Brame, formerly of Greensboro, N.C., and now of Grand Prairie, Texas, pleaded guilty on Jan. 10, 2014, to identity theft, tax, and fraud charges, the Department of Justice and the Internal Revenue Service (IRS) announced today.  Brame pleaded guilty to one count of wire fraud, one count of aggravated identity theft and one count of aiding and assisting the preparation of a false tax return.  U.S. District Judge Thomas Schroeder for the Middle District of North Carolina set a sentencing hearing for May 16, 2014.

According to court documents, from approximately February 2009 to February 2011, Brame was employed as a social worker at the Alamance County Department of Social Services (Alamance DSS) in North Carolina.  Brame was responsible for investigating claims of abuse and neglect against minors and disabled adults.  As part of her official duties, Brame had authorized access to extensive identifying information – including names, dates of birth and Social Security numbers - of Alamance DSS clients, including abuse victims and recipients of various state benefits, and of witnesses in official investigations. 

According to court documents, Brame used her access to identifying information contained in Alamance DSS records to illegally obtain the personal identifying information of Alamance DSS clients and others.  Pursuant to an ongoing agreement, Brame sold that personal identifying information to Jennifer Bullock and Saichelle McNeill, two return preparers at the Greensboro branch of Nothing But Taxes, a tax return preparation firm.  Bullock and McNeill used the stolen identities to claim false dependents on tax returns they prepared for Nothing But Taxes clients, thereby claiming inflated tax refunds on the clients’ behalf.  Bullock and McNeill paid Brame $200 to $300 per identity they purchased, and Brame knowingly sold these identities to Bullock and McNeill to be used for tax fraud.

Court documents state that, as a social worker, Brame owed a legal and professional duty to keep the information she learned about victims and witnesses confidential.  She had no authority to sell such information or otherwise use it for personal gain, and doing so violated the professional standards applicable to social workers, as well as federal and state law and Alamance DSS policy.

According to court documents, one victim of the identity theft scheme was referred to Alamance DSS for investigation on or about Feb. 15, 2010, and assigned to Brame.  A few days later, Brame sold this victim’s identity to Bullock for use as a false dependent on a tax return.  On or about March 3, 2010, Bullock prepared a 2009 tax return for a Nothing But Taxes client which falsely claimed that the victim was a dependent.  As a result of the falsification, the tax return claimed a higher tax refund than the Nothing But Taxes client was actually entitled to receive.  Approximately one year later, Brame sold the victim’s identity and that of her sister to McNeill, who then prepared 2010 tax returns for two different Nothing But Taxes clients that falsely claimed both victims as dependents.

Brame faces a statutory maximum of 20 years in prison on the wire fraud charge and a maximum of three years in prison for the charge of aiding and assisting in the preparation of a false tax return.  The aggravated identity theft charge carries a mandatory two year sentence, which must run consecutively to any sentence on the other charges.

The related case against McNeill resulted in a guilty plea to federal criminal charges of wire fraud, aggravated identity theft and aiding and assisting in the preparation of false tax returns.  McNeill was sentenced to serve 27 months in federal prison on Aug. 20, 2013.  Brame’s co-defendant Bullock pleaded guilty to wire fraud, aggravated identity theft and tax charges on Dec. 4, 2013, and she is currently awaiting sentencing. 

This case and related Nothing But Taxes cases were investigated by agents of the IRS -Criminal Investigation and were prosecuted by Assistant U.S. Attorney Frank Chut and Trial Attorney Jonathan Marx of the Tax Division.  The prosecution team wishes to thank the Alamance DSS for their assistance and cooperation in the investigation.

The U.S. Department of Justice, the U.S. Attorney’s Office for the Western District of North Carolina and the North Carolina Department of Justice filed a lawsuit today alleging that defendants Auto Fare Inc., Southeastern Auto Corp. and Zuhdi A. Saadeh—the owners and operators of two “buy here, pay here” used-car dealerships in Charlotte, N.C. —violated the federal Equal Credit Opportunity Act by intentionally targeting African-American customers for the extension and servicing of installment sale contracts on unfair and predatory terms.  The State of North Carolina also alleges that the defendants’ actions violated the state’s Unfair and Deceptive Trade Practices Act.

The complaint, which was filed today in the U.S. District Court for the Western District of North Carolina, alleges that the defendants engaged in a pattern or practice of “reverse redlining” by targeting African-American customers for installment sale contracts with inflated sales prices, down payments, and interest rates without meaningfully assessing the customers’ credit.  The complaint states that Saadeh, who operates Auto Fare and United Car Sales, has used racial slurs to refer to African-Americans and made statements expressing his views that African-American customers have fewer credit options, making them more likely to accept the predatory terms of the contracts offered by the defendants. 

The defendants’ practices resulted in rates of default and repossession that are higher than other subprime used-car dealers.  The complaint also alleges that the defendants failed to provide customers with a reasonable notice of repossession, repossessed vehicles of customers who were not in default on their contracts, failed to give customers refunds they were due, improperly seized customers’ personal property in repossessed vehicles and used global positioning system devices to locate and repossess vehicles without informing customers that the dealership had installed these devices. 

The U.S. Department of Justice, the U.S. Attorney’s Office for the Western District of North Carolina and the North Carolina Department of Justice investigated and filed the lawsuit jointly.

“Intentionally targeting African-Americans for contracts with predatory terms because of their race violates fair lending laws,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division.  “By filing this lawsuit, the Justice Department is acting to ensure that subprime dealers in the auto industry provide credit in accordance with the law.  The Justice Department will continue to ensure that people have equal access to credit, regardless of race.”

“The terms of a person’s loan should not be determined by their race,” said U.S. Attorney Anne M. Tompkins for the Western District of North Carolina.  “Predatory lending and illegal discrimination will simply not be tolerated.”

“Charging people inflated prices based on their race isn’t the way to do business in our state,” said North Carolina Attorney General Roy Cooper.  “These allegations show outrageous behavior that should be stopped.”

The Civil Rights Division and other agencies involved in this matter are part of the Financial Fraud Enforcement Task Force, established by President Obama to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources.  The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.  For more information on the task force, visit www.StopFraud.gov.

African-American customers who entered into installment sale contracts for the purchase of automobiles at Auto Fare or United Car Sales since 2006, former employees of the dealerships and any other individuals with information relevant to this lawsuit are encouraged to contact the U.S. Department of Justice at 1-800-896-7743, mailbox 92, or at AutoFareLawsuit@usdoj.gov.

A copy of the complaint, as well as additional information about fair lending enforcement by the Justice Department, can be obtained from the Justice Department website at www.justice.gov/fairhousing .  Fighting illegal lending discrimination is a top priority of the Justice Department.  More information about the Civil Rights Division and the laws it enforces is available at www.usdoj.gov/crt . 

The government has intervened in eight False Claims Act lawsuits against Health Management Associates Inc. (HMA) alleging that HMA billed federal health care programs for medically unnecessary inpatient admissions from the emergency departments at HMA hospitals and paid remuneration to physicians in exchange for patient referrals, the Justice Department announced today.  The government also has joined in the allegations in one of these lawsuits that Gary Newsome, HMA’s former CEO, directed HMA’s corporate practice of pressuring emergency department physicians and hospital administrators to raise inpatient admission rates, regardless of medical necessity.  HMA operates 71 hospitals in 15 states: Alabama, Arkansas, Florida, Georgia, Kentucky, Mississippi, Missouri, North Carolina, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Washington and West Virginia. 

“The Department of Justice is committed to ensuring that health care providers who attempt to misuse federal health care programs for their own profit are held accountable,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.  “Schemes such as this one can contribute significantly to the rising cost of delivering health care and create needless patient risk.”

The lawsuits allege that HMA’s corporate officers, at the direction of Newsome, exerted significant pressure on doctors in the emergency department to admit patients who could have been placed in observation, treated as outpatients or discharged, and that this resulted in the submission of inflated or false claims to federal health care programs.  One lawsuit also alleges that patients were improperly admitted for scheduled surgical procedures that should have been done on an outpatient basis.  The complaints further allege that HMA paid kickbacks, either in the form of bonuses or awarded contracts, to physician groups staffing HMA emergency rooms to induce the physicians to admit patients unnecessarily.

In addition, the lawsuits allege that HMA paid kickbacks to other physician groups to induce referrals.  For example, HMA allegedly provided improper remuneration, both through the provision of free office space and staffing and through direct payments, to Primary Care Associates, a physician practice group in Port Charlotte, Fla., in exchange for referrals to two HMA hospitals in Florida.  HMA also allegedly paid kickbacks to physicians in Lancaster, Pa., by paying inflated prices for physician-owned assets, providing sham medical directorship contracts and selling assets to physicians for below fair market value.

The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and other federally funded programs.  The Stark Statute prohibits a hospital from submitting claims for patient referrals made by a physician with whom the hospital has an improper financial arrangement.  Both the Anti-Kickback Statute and Stark Statute are intended to ensure that a physician’s medical judgment is not compromised by improper financial incentives and is instead based on the best interests of the patient. 

“This intervention decision marks the culmination of a lengthy and comprehensive investigation into a variety of serious fraud allegations against one of our district’s largest health care providers,” said Acting U.S. Attorney for the Middle District of Florida A. Lee Bentley III.  “We hope that this case will serve as a reminder to our provider community that this office is fully engaged in the struggle against misconduct of this kind.”

 
“Improper hospital admissions cost the government millions of dollars in unnecessary fees and subject patients to excessive treatment and needless risk, driving up the cost of health care,” said U.S. Attorney for the Western District of North Carolina Anne M. Tompkins.  “The government will pursue aggressively providers that boost their profits at the expense of Medicare and other government programs.”

“Unlawful financial relationships between hospitals and physicians solely to increase referrals are, unfortunately, a common practice that corrupts the health care system,” said U.S. Attorney for the Southern District of Florida Wifredo A. Ferrer.  “The system also suffers a direct financial hit when hospitals fraudulently increase admissions where they are not indicated, solely to benefit hospitals’ bottom line.  We will not relent in our efforts to combat these kinds of fraudulent schemes and recover funds for the Medicare program.”

“HMA’s submission of claims to Medicare, Medicaid and TRICARE for unnecessary inpatient stays is a serious matter that threatens the integrity of our entire health care system, and the end result is that those who need health care cannot afford it,” said U.S. Attorney for the Middle District of Georgia Michael J. Moore.  “The Middle District of Georgia is committed to fighting health care fraud.”

“Investigations such as these are a very high priority for the FBI because of the potential impact to the nation’s health care system and to the public,” said FBI Assistant Director Ron Hosko.  “Because of the priority nature of these cases as well as their complexity, we have created a centralized team to provide nationwide support to our field offices called the Major Provider Response Team.  The FBI is committed to working with our partners in these types of investigations and appreciates the public’s involvement in the process.”

The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government when they believe that defendants submitted false claims for government funds and to receive a share of any recovery.  The False Claims Act also permits the government to intervene in such lawsuits, as it has done in these cases.  The eight lawsuits are pending in the Southern and Middle Districts of Florida, Middle District of Georgia, Northern District of Illinois, Western District of North Carolina, Eastern District of Pennsylvania and District of South Carolina .

The government’s intervention in these matters illustrates its 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 Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius.  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 $17 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.

These matters were investigated by the Commercial Litigation Branch of the Justice Department’s Civil Division; the U.S. Attorney’s Offices for the Southern and Middle Districts of Florida, Middle District of Georgia, Northern District of Illinois, Western District of North Carolina, Middle and Eastern Districts of Pennsylvania and District of South Carolina; the Department of Health and Human Services Office of Inspector General and the Federal Bureau of Investigation.

The cases are captioned United States ex rel. Brummer v. Health Mgmt. Assocs. Inc. , et al.,3-09-cv-135 (CDL)(M.D. Ga.); United States ex rel. Williams v. Health Mgmt. Assocs. Inc. et al., 3:12-cv-151 (M.D. Ga.) United States ex rel. Plantz v. Health Mgmt. Assocs. Inc., et al., 13C-1212 (N.D. Ill.) United States ex rel. Miller v. Health Mgmt. Assocs. Inc., et al., 10-3007 (E.D. Pa.) United States ex rel. Mason v. Health Mgmt. Assocs. Inc., et al., 3:10-CV-472-GCM (W.D.N.C.) United States ex rel. Nurkin v. Health Mgmt. Assocs. Inc., et al., 2:11-cv-14-FtM-29DNF (M.D. Fla.) United States ex rel. Jacqueline Meyer & Cowling v. Health Mgmt. Assocs. Inc., et al.; 0:11-cv-01713-JFA (D.S.C.) and United States ex rel. Paul Meyer v. Health Mgmt. Assocs. Inc., et al.,11-62445 cv-Williams (S.D. Fla.).

The claims asserted against HMA and Newsome are allegations only, and there has been no determination of liability.

A former disc jockey for area high school parties pleaded guilty today in the District of Puerto Rico to producing child pornography.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Rosa Emilia Rodríguez-Vélez of the District of Puerto Rico, and Special Agent in Charge Angel M. Melendez of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) in San Juan made the announcement.

Eduardo Santiago-Rivera, 45, pleaded guilty before U.S. Magistrate Judge V élez-Riv é in the District of Puerto Rico to nine counts of sexual exploitation of children and one count of possession of child pornography. Santiago-Rivera was charged by superseding indictment on May 13, 2013.

Santiago-Rivera was a disc jockey who met his victims at area high school parties and on various social networking sites. Santiago-Rivera admitted that in June and July 2012, he induced, persuaded, enticed, coerced and used at least three minors, who ranged in age from 12 to 15, to engage in sexually explicit conduct for the purpose of creating video images. Santiago-Rivera used an Internet-based video chat program, “ooVoo,” to direct and coerce the minors to undress and to engage in various acts of sexually explicit conduct, including masturbation and the lascivious exhibition of their genitals. Santiago-Rivera also recorded himself engaging in sexual acts with one of the minors.

Santiago-Rivera has been in federal custody since he was arrested on July 27, 2012. Sentencing will be scheduled at a later date.

This case was investigated by ICE HSI. The case is being prosecuted by Trial Attorneys Mark Angehr of the Criminal Division’s Public Integrity Section and Amy E. Larson of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Marshal Morgan of the District of Puerto Rico.

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

Today the District Court in the District of Columbia dismissed a challenge filed by the Florida Bankers Association and Texas Bankers Association challenging 2012 amendments to the Department of the Treasury’s interest-reporting regulations.  The regulations require U.S. banks to report to the Internal Revenue Service (IRS) information about accounts earning more than $10 of interest beginning in 2013 that are held by nonresident aliens of all countries with which the United States has a tax treaty or other information exchange agreement.  These new reporting requirements help the United States’ ability to comply with requests from its treaty and exchange partners and implement the Foreign Account Tax Compliance Act.

“This ruling advances the Department of Justice’s and Internal Revenue Service’s continuing efforts to pursue taxpayers trying to evade taxes through offshore accounts,” said Assistant Attorney General Kathryn Keneally of the Tax Division.  “The court’s opinion today represents an important step in our commitment to work with our treaty partners to eliminate cross-border tax evasion.” 

The court upheld the regulations’ 2012 amendments, finding that the IRS “reasonably concluded that the regulations will improve U.S. tax compliance, deter foreign and domestic tax evasion, impose a minimal reporting burden on banks, and not cause any rational actor – other than a tax evader – to withdraw his funds from U.S. accounts.”

The court’s decision affirms the IRS’ ongoing efforts to close the tax gap through cooperative measures with foreign governments, including the 2012 amendments. 

Related Materials:

Florida Bankers Association, et al. v. United States Department of Treasury, et al.
Memorandum Opinion
 

The U.S. Department of Justice’s Office for Victims of Crime (OVC) today announced a $8,355,648 grant to organizations providing direct support to assist the victims, witnesses and first responders involved in the events surrounding the Boston Marathon bombings in April 2013.

  “This grant funding will provide critical support to many who were affected by last year’s terrorist attack on the Boston Marathon,” said Attorney General Eric Holder.  “We will never forget the courage of the first responders, marathon participants, and bystanders who rushed to save lives on that terrible day, nor the heartbreak and pain of those who suffered injuries or lost friends and loved ones.  With this grant, we reaffirm the Justice Department’s firm commitment to standing with the victims of this heinous crime – and all of the community leaders and service providers who continue to heal this remarkable and resilient city.”

On April 15, 2013, two pressure cooker bombs were detonated 13 seconds apart near the finish line of the Boston Marathon, killing three spectators and injuring hundreds more.  On April 18, 2013, the suspects allegedly shot and killed an officer of the Massachusetts Institute of Technology Police Department.  Subsequently, the two suspects allegedly carjacked a vehicle and took the vehicle’s owner hostage; he later escaped.  On April 19, 2013, a Watertown, Mass., police officer identified the suspects and a gunfight ensued between the suspects and police in a Watertown neighborhood.  This incident resulted in one suspect’s death when he was struck by a vehicle as the other suspect fled the scene.  Later that day, police apprehended the remaining suspect in a different Watertown neighborhood.  Victims affected include those in the vicinity of the bombings as well as the residents of neighborhoods in which subsequent events unfolded.  An estimated 1,000 victims will require crisis and/or longer-term recovery services. 

OVC provided the Antiterrorism and Emergency Assistance Program (AEAP) grant to the Massachusetts Office for Victim Assistance (MOVA).

“MOVA has worked diligently with OVC and our federal, state and local partners to serve those impacted by the Boston Marathon bombings, while planning a longer term solution to meet their evolving needs in the years to come,” said MOVA Executive Director Liam Lowney. “We are grateful to OVC for its continued support in developing a response that is tailored to specifically address the physical and emotional injuries caused to so many individuals, their families and our community as a whole by this tragedy.”

This award will include costs, both incurred and anticipated, for organizations providing crisis intervention services and trauma-informed care, continuum of care, socioeconomic support, wrap-around legal services and other victim assistance.

“OVC is committed to promoting healing and justice for all victims of crime,” said OVC Director Joye Frost.  “We acknowledge the hardships that all victims of crime face and recognize the enormous physical, emotional and financial toll of the Boston bombings on victims and their loved ones.  Many of these bombing victims face serious and protracted medical problems as well as long-term financial loss and emotional upheaval.  This award will ensure that Boston and the state of Massachusetts can provide critical support to victims and their families as they work to restore a sense of normalcy to their lives.”

In 1995, following the Oklahoma City bombing, Congress authorized OVC to set aside and administer up to $50 million annually from the Crime Victims Fund for the Antiterrorism Emergency Reserve Fund to assist victims in extraordinary circumstances.  Following an act of terrorism or mass violence, jurisdictions can apply for an AEAP grant award for crisis response, criminal justice support, crime victim compensation and training and technical assistance expenses.  OVC also provided AEAP funds and assistance following the shootings in Newtown, Conn. (2012); Oak Creek, Wis. (2012); Aurora, Colo. (2012); Tucson, Ariz. (2011); Binghamton, N.Y. (2009); and at the Virginia Polytechnic Institute and State University (2007).

 For more information on the AEAP program, please visit www.ojp.usdoj.gov/ovc/AEAP/index.html.

 The Office of Justice Programs (OJP), headed by Assistant Attorney General Karol V. Mason, provides federal leadership in developing the Nation’s capacity to prevent and control crime, administer justice and assist victims.  OJP has six components: the Bureau of Justice Assistance; the Bureau of Justice Statistics; the National Institute of Justice; the Office of Juvenile Justice and Delinquency Prevention; the Office for Victims of Crime and the Office of Sex Offender Sentencing, Monitoring, Apprehending, Registering and Tracking.  More information about OJP can be found at www.ojp.gov.

Nakia Jackson pleaded guilty to one count of conspiracy to defraud the United States and one count of aggravated identity theft for his role in a stolen identity refund fraud scheme, announced Assistant Attorney General Kathryn Keneally of the Justice Department's Tax Division, U.S. Attorney George L. Beck Jr. for the Middle District of Alabama and the Internal Revenue Service (IRS).

According to court documents, between January 2009 and March 2011, Jackson obtained stolen identities from an Alabama state employee and used those identities to file false tax returns.  Jackson recruited a bank employee, LaQuanta Clayton, to assist him in having the false income tax refunds deposited into various bank accounts.  He obtained permission from several individuals to use their bank accounts to receive false refunds and when a false refund was deposited, Jackson would direct the individuals to withdraw the money and give the money to him.  In total, Jackson filed over 100 false tax returns and requested over $400,000 in refunds.  

Sentencing has been scheduled for April 23, 2014.  Jackson faces a statutory minimum sentence of two years in prison and a statutory maximum sentence of 12 years in prison, three years of supervised release, restitution and a maximum fine of $250,000, or twice the loss caused by the offense.  LaQuanta Clayton has already pleaded guilty and is awaiting sentencing. 

IRS-Criminal Investigation agents investigated this case and Tax Division Trial Attorneys Charles M. Edgar Jr. and Michael Boteler and Assistant U.S. Attorney Todd Brown are prosecuting the case.

More information about the Tax Division and its enforcement efforts can be found at www.justice.gov/tax .

The U.S. Department of Justice and the U.S. Department of Commerce’s National Institute of Standards and Technology (NIST) today announced appointments to a newly created National Commission on Forensic Science.

 
Members of the commission will work to improve the practice of forensic science by developing guidance concerning the intersections between forensic science and the criminal justice system.  The commission also will work to develop policy recommendations for the U.S. Attorney General, including uniform codes for professional responsibility and requirements for formal training and certification. 

 
The commission is co-chaired by Deputy Attorney General James M. Cole and Under Secretary of Commerce for Standards and Technology and NIST Director Patrick D. Gallagher.  Nelson Santos, deputy assistant administrator for the Office of Forensic Sciences at the Drug Enforcement Administration, and John M. Butler, special assistant to the NIST director for forensic science, serve as vice-chairs.

 
“I appreciate the commitment each of the commissioners has made and look forward to working with them to strengthen the validity and reliability of the forensic sciences and enhance quality assurance and quality control,” said Deputy Attorney General Cole.  “Scientifically valid and accurate forensic analysis supports all aspects of our justice system.”

 
The commission includes federal, state and local forensic science service providers; research scientists and academics; law enforcement officials; prosecutors, defense attorneys and judges; and other stakeholders from across the country.  This breadth of experience and expertise reflects the many different entities that contribute to forensic science practice in the U.S. and will ensure these broad perspectives are represented on the commission and in its work.

 
“This new commission represents an extremely broad range of expertise and skills,” said Under Secretary Gallagher.  “It will help ensure that forensic science is supported by the strongest possible science-based evidence gathering, analysis and measurement.

 
“This latest and most impressive collaboration between the Department of Justice and the National Institute of Standards and Technology will help ensure that the forensic sciences are supported by the most rigorous standards available—a foundational requirement in a nation built on the credo of ‘justice for all,’” said John P. Holdren, Assistant to the President for Science and Technology and Director of the White House Office of Science and Technology Policy.

 
The following commissioners were chosen from a pool of more than 300 candidates:

 
Suzanne Bell, Ph.D. , Associate Professor, West Virginia University; Frederick Bieber, Ph.D., Medical Geneticist, Brigham and Women’s Hospital and Associate Professor of Pathology, Harvard Medical School; Thomas Cech, Ph.D. , Distinguished Professor, University of Colorado, Boulder; Cecelia Crouse, Ph.D. , Director, Palm Beach County Sheriff’s Office Crime Laboratory; Gregory Czarnopys , Deputy Assistant Director, Forensic Services, Bureau of Alcohol, Tobacco, Firearms, and Explosives; M. Bonner Denton, Ph.D. , Professor, University of Arizona; Vincent Di Maio, M.D., Consultant in Forensic Pathology; Troy Duster, Ph.D. , Chancellor’s Professor and Senior Fellow, Warren Institute on Law and Social Policy, University of California, Berkeley; Jules Epstein , Associate Professor of Law, Widener University; Stephen Fienberg, Ph.D. , Maurice Falk University Professor of Statistics and Social Science, Carnegie Mellon University; Andrea Ferreira-Gonzalez, Ph.D. , Professor of Pathology and Director Molecular Diagnostics Laboratory, Virginia Commonwealth University; John Fudenberg , Assistant Coroner, Office of the Coroner/Medical Examiner, Clark County, Nevada; S. James Gates, Jr., Ph.D. , University System Regents Professor and John S. Toll Professor of Physics, University of Maryland; Dean Gialamas , Crime Laboratory Director, Los Angeles County Sheriff’s Department, Scientific Services Bureau; Paul Giannelli , Distinguished University Professor and Albert J Weatherhead III and Richard W. Weatherhead Professor of Law, Case Western Reserve University; Hon. Barbara Hervey , Judge, Texas Court of Criminal Appeals; Susan Howley , Public Policy Director, National Center for Victims of Crime; Ted Hunt , Chief Trial Attorney, Jackson County Prosecuting Attorney’s Office, Kansas City, Missouri; Linda Jackson , Director, Virginia Department of Forensic Science;  John Kacavas , United States Attorney, District of New Hampshire; Pamela King, Assistant State Public Defender, Minnesota State Public Defender Office; Marc LeBeau, Ph.D. , Senior Forensic Scientist, Scientific Analysis Section, Federal Bureau of Investigation; Julia Leighton , General Counsel, Public Defender Service, District of Columbia; Hon. Bridget Mary McCormack , Justice, Michigan Supreme Court; Peter Neufeld , Co-Director, Innocence Project, Benjamin Cardozo School of Law; Phil Pulaski , Chief of Detectives, New York City Police Department; Hon. Jed Rakoff , Senior United States District Judge, Southern District of New York; Matthew Redle , Sheridan County and Prosecuting Attorney, Sheridan, Wyoming; Michael “Jeff” Salyards, Ph.D. , Executive Director, Defense Forensic Science Center, Department of the Army; and Ryant Washington , Sheriff, Fluvanna County Sherriff’s Office, Fluvanna, Virginia.

Ex-Officio Members:

David Honey, Ph.D. , Assistant Deputy Director of National Intelligence for Science and Technology and Director of Science and Technology, Office of the Director of National Intelligence; Marilyn Huestis, Ph.D., Chief, Chemistry and Drug Metabolism Section, National Institute on Drug Abuse, National Institutes of Health; Gerald LaPorte , Acting Director, Office of Investigative and Forensic Sciences, National Institute of Justice; Patricia Manzolillo , Laboratory Director, Forensic Laboratory Services, U.S. Postal Inspection Service; Frances Schrotter , Senior Vice President and Chief Operation Officer, American National Standards Institute; Kathryn Turman , Assistant Director, Office for Victim Assistance, Federal Bureau of Investigation; and Mark Weiss, Ph.D. , Division Director, Behavioral and Cognitive Sciences, National Science Foundation.

 
The first meeting of the Commission will be held February 3-4, 2014, at 810 7th Street, N.W., Washington, DC.  The membership list, notice of meetings, commission charter and other related material will be maintained within the General Service Administration’s Federal Advisory Committee Act (FACA) database at http://www.facadatabase.gov .

 
As a non-regulatory agency of the U.S. Department of Commerce, NIST promotes U.S. innovation and industrial competitiveness by advancing measurement science, standards and technology in ways that enhance economic security and improve our quality of life.  To learn more about NIST, visit www.nist.gov .

Attorney General Eric Holder issued the following statement today on the status of same-sex marriages performed in the state of Utah:

 “Last June, the Supreme Court issued a landmark decision – in United States v. Windsor – holding that Americans in same-sex marriages are entitled to equal protection and equal treatment under the law.  This ruling marked a historic step toward equality for all American families.  And since the day it was handed down, the Department of Justice has been working tirelessly to implement it in both letter and spirit—moving to extend—federal benefits to married same-sex couples as swiftly and smoothly as possible.

"Recently, an administrative step by the court has cast doubt on same-sex marriages that have been performed in the state of Utah.  And the governor has announced that the state will not recognize these marriages pending additional court action.

"In the meantime, I am confirming today that, for purposes of federal law, these marriages will be recognized as lawful and considered eligible for all relevant federal benefits on the same terms as other same-sex marriages.  These families should not be asked to endure uncertainty regarding their status as the litigation unfolds. In the days ahead, we will continue to coordinate across the federal government to ensure the timely provision of every federal benefit to which Utah couples and couples throughout the country are entitled – regardless of whether they are in same-sex or opposite-sex marriages.  And we will continue to provide additional information as soon as it becomes available.”

 A video recording of the Attorney General delivering the above statement can be viewed at: www.justice.gov/video.php.

Assistant Attorney General Bill Baer in charge of the Department of Justice’s Antitrust Division made the following statement today after the U.S. District Court for the Northern District of California found that Bazaarvoice Inc. violated Section 7 of the Clayton Act by acquiring its primary rival, PowerReviews Inc:

“By acquiring its only significant rival, Bazaarvoice deprived its customers of the benefits of competition.  We are pleased that the court, after carefully weighing all of the evidence, agreed with the Justice Department that Bazaarvoice’s acquisition of PowerReviews was likely to extinguish price competition and substantially diminish the pace of innovation in the market for product ratings and reviews platforms.

“As shown during trial, Bazaarvoice executives clearly intended to eliminate competition by acquiring PowerReviews.  Consistent with Bazaarvoice’s own pre-merger view of the marketplace, the evidence presented at trial demonstrated that PowerReviews was a significant threat to Bazaarvoice and that other rivals are poorly positioned to fill the competitive void created by the merger.

“I am proud of the excellent work done by the trial team on behalf of U.S. consumers.  As today’s decision reaffirms, anticompetitive transactions that are not reported to federal agencies will not receive a free pass from antitrust scrutiny.” 

Background

On Jan.10, 2013, the department filed a civil antitrust lawsuit in the U.S. District Court for the Northern District of California against Bazaarvoice.  The department alleged that Bazaarvoice’s June 2012 acquisition of PowerReviews eliminated the company’s only significant rival, in violation of the antitrust laws. 

Bazaarvoice’s acquisition of PowerReviews was not required to be reported under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, which requires companies to notify and provide information to the department and the Federal Trade Commission before consummating certain acquisitions.  The department began its investigation shortly after the transaction closed.

The department’s trial against Bazaarvoice, which was overseen by Judge William Orrick, began on Sept. 23, 2013.  The trial lasted three weeks, with closing arguments taking place on Oct. 15, 2013.  The court scheduled a hearing on Jan. 22, 2014, to discuss procedures for the remedy phase of the litigation.

Michael Slattery Jr., an Irish national, was sentenced in federal court in Brooklyn, N.Y., today to serve 14 months in prison to be followed by three years of supervised release, for conspiracy to violate the Lacey Act in relation to illegal rhinoceros horn trafficking, announced Acting Assistant Attorney General Robert G. Dreher for the Environment and Natural Resources Division of the Department of Justice, U.S. Attorney Loretta E. Lynch for the Eastern District of New York, and Director Dan Ashe of the U.S. Fish and Wildlife Service. Slattery was also sentenced to pay a $10,000 fine and forfeit $50,000 of proceeds from his illegal trade in rhino horns.

Slattery was arrested in September 2013 as part of “Operation Crash,” a nation-wide crackdown in the illegal trafficking in rhinoceros horns, for his role in trafficking raw rhinoceros horns from Texas to customers in New York. Slattery was sentenced today by U.S. District Judge John Gleeson of the Eastern District of New York.

“Mr. Slattery is today being held accountable for his participation in the illegal trade in wildlife species and products, which threatens the very existence of highly-endangered rhino species,” said Acting Assistant Attorney General Dreher. “We will continue this active and ongoing investigation and wish to send a clear message to buyers and sellers that we will vigorousl y prosecute those who are involved in this devastating trade.

“We take seriously our obligation to protect these links to the Earth’s prehistoric past,” said U.S. Attorney Lynch. “Michael Slattery’s actions were part of the exploitation and decimation of these animals from their only known predator – man. He is now being held to account for his actions in furthering this devastating trade.”

“We’re reaching a tipping point, where the unprecedented slaughter of rhinos and elephants happening now threatens the viability of these iconic species’ wild populations in Africa,” said Director Ashe. “This slaughter is fueled by illegal trade, including that exposed by Operation Crash. We will continue to work relentlessly across the United States government and with our international partners to crack down on poaching and wildlife trafficking.”

According to the information, plea agreement and statements made during court proceedings: In China and Vietnam, rhinoceros horns are highly prized because they are believed to have medicinal value. The escalating value of the horns has resulted in an increased demand that has helped fuel a thriving black market.

In pleading guilty, Slattery admitted to participating in a conspiracy to travel to and within the United States to purchase rhinoceros horns, which he, along with others, then resold to private individuals or consigned to auction houses in the United States, knowing that the interstate purchase and sale of the horns was illegal.   Due to their dwindling populations, all rhinoceros species are protected under international trade agreements.

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

Operation Crash is a continuing investigation being conducted by the Department of the Interior’s Fish and Wildlife Service (FWS) in coordination with other federal and local law enforcement agencies including U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.  A “crash” is the term for a herd of rhinoceros.  Operation Crash is an ongoing effort to detect, deter and prosecute those engaged in the illegal killing of rhinoceros and the unlawful trafficking of rhinoceros horns.

The investigation was handled by the U.S. Fish & Wildlife Service, the U.S. Attorney’s Office for the Eastern District of New York and the Justice Department’s Environmental Crimes Section. Assistant U.S. Attorney Julia Nestor and Trial Attorney Gary N. Donner of the Justice Department’s Environmental Crimes Section are in charge of the prosecution. 

(Hagatna, Guam) - U.S. Attorney ALICIA A.G. LIMTIACO announced today that the Districts of Guam and the Northern Mariana Islands collected $575,199.11 in criminal and civil actions in Fiscal Year 2013.  Of this amount, $542,674.11was collected in criminal actions and $32,525 was collected in civil actions

Attorney General Eric Holder announced on Thursday that the Justice Department collected $8.1 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2013.  The more than $8 billion in collections in FY 2013 represents nearly three times the appropriated $2.76 billion budget for the 94 U.S. Attorney’s offices and the main litigating divisions in that same period.

“The department’s enforcement actions help to not only ensure justice is served, but also deliver a valuable return to the American people,” said Attorney General Holder. “It is critical that Congress provide the resources necessary to match the department’s mounting caseload. As these figures show, supporting our federal prosecutors is a sound investment.”

“During this time of economic and fiscal challenges, these collections are more important than ever,” said U.S. Attorney Limtiaco.  “The U.S. Attorney’s Office is dedicated to protecting the public and recovering funds for victims of federal crime and for the federal treasury.  We will continue to hold accountable those who seek to profit from their illegal activities.”

The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims.  The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.  While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.

The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws.  In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.

dditionally, the U.S. Attorney’s office in Guam working with partner agencies and divisions, collected$36,220.00 in asset forfeiture actions in FY 2013. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.

Michael R. Barr, former chief executive officer of Louisville, Kentucky-based HealthEssentials Solutions Inc., has agreed to pay $1 million to resolve allegations that he knowingly caused HealthEssentials to submit false claims to Medicare between 1999 and 2004, the Justice Department announced today.  Norman J. Pfaadt, HealthEssentials’ former chief financial officer, also agreed to pay $20,000 to resolve similar allegations.  H ea lt h E s s e nt i a ls p r o vi d ed p r i m a ry m e di c al c a re to p a ti e nts in nursing fa cilit ies, assisted living facilities and other settings from 1998 until it filed for bankruptcy and ceased operations in 2005.  Barr founded HealthEssentials and served as its president, chief executive and board chairman.  Pfaadt served as HealthEssentials’ senior vice president and chief financial officer. 

 
“Healthcare executives should lead by example and create cultures of compliance within their companies, not pressure their employees to cheat the taxpayers,” said Assistant Attorney General for the Civil Division Stuart F. Delery.  “We will continue to hold health care executives personally accountable for their dealings with Medicare.”

 
“Pursuing health care fraud is a priority of this office and the Department of Justice,” said U.S. Attorney for the Western District of Kentucky David J. Hale.  “We will continue to work with the Department of Health and Human Services and the public to ensure that fraudulent claims are investigated and those responsible are required to pay.”

           
In March 2008, HealthEssentials pleaded guilty to submitting false statements to Medicare relating to services it provided to patients in assisted living facilities and entered into a civil settlement with the government.  In May 2011, HealthEssentials’ former director of billing, Karen Stone, pleaded guilty for her role in the company’s billing scheme.

 
The settlement announced today resolves Barr’s and Pfaadt’s alleged liability under the False Claims Act for their roles in HealthEssentials’ false billings.  The government alleged that, between 1999 and 2004, HealthEssentials billed for services that were inflated or not medically necessary and that Barr and Pfaadt pressured HealthEssentials employees to inflate the company’s billings, despite having been advised by attorneys and others that doing so would be improper.  The government further alleged that Barr pressured HealthEssentials employees to conduct special medical assessments on patients, without regard to whether the patients required the assessments, solely to increase the amount that HealthEssentials could bill for the visits.  As part of the settlement, Barr has agreed to a three-year period of exclusion from participating in federally funded health care programs. 

“Executives cheating taxpayers and patients – as alleged in this case – should beware of exclusion from Medicare, Medicaid and all other federal health programs, as well as criminal and civil liability,” said Inspector General of the U.S. Department of Health and Human Services Daniel R. Levinson.  “Vulnerable beneficiaries deserve protection from potentially harmful, medically unnecessary services.”  

 
The allegations that were resolved by the settlement arose in part from a lawsuit filed by former HealthEssentials employees Michael and Leigh RoBards under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring suit on behalf of the government and to share in any recovery.  Mr. and Mrs. RoBards will receive a total of $153,000. 

 
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 Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius.  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 $17 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.

 
The case was handled by the Commercial Litigation Branch, Civil Division, U.S. Department of Justice and the U.S. Attorney’s Office for the Western District of Kentucky, with assistance from the Department of Health and Human Services Office of Inspector General and the Federal Bureau of Investigation.  

 
The claims settled by this agreement are allegations only; there has been no determination of liability.  The case is captioned United States ex rel. Stydinger, et al. v. Michael R. Barr and Norman J. Pfaadt, Civil No. 3:03-cv-00380-TBR (W.D. Ky.).

Today, the Department of Justice and the U.S. Attorney for the Middle District of Georgia announced that Kerry Bolden, a former employee of the Correctional Emergency Response Team (CERT) at Macon State Prison (MSP) in Oglethorpe, Ga., pleaded guilty to civil rights and conspiracy charges.  Bolden is the fifth former MSP officer to enter a guilty plea in connection with the ongoing federal investigation into a series of staff assaults of MSP inmates.

According to court documents filed in connection with his guilty plea, Bolden admitted that he and other CERT members escorted inmates to the gym, where CERT members would beat the inmates in retaliation for the inmates’ prior assault of a MSP officer.  Bolden recognized that the inmates had been injured by CERT’s unjustified use of force, and he also knew, based on past experience, that CERT members would submit false reports to cover up their abuse of inmates.  Bolden admitted that he personally submitted a false report, which omitted any reference to the unjustified force used on, or injuries inflicted upon, an inmate, who ultimately had to be transported by ambulance to a nearby hospital.  MSP supervisors told Bolden to stick to his false report when interviewed by investigators regarding the assault of the inmate.

“ The majority of corrections officers serve their communities with honor and integrity,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division.  “When officers abuse those entrusted to their care and then use their official position to cover it up, we will continue to investigate, prosecute, and hold them accountable.”  

Bolden, who is 47, and from Vienna, Ga., faces a statutory maximum sentence of 15 years in prison. 

“Today’s guilty plea is another example of the zero tolerance the Department of Justice has for correctional officers who use their position to try to cover up official misconduct,” said U.S. Attorney Michael J. Moore for the Middle District of Georgia. 

This case is being investigated by the FBI, and is being prosecuted by Trial Attorneys Forrest Christian and Tona Boyd of the Civil Rights Division’s Criminal Section, with the assistance of the U.S. Attorney’s Office for the Middle District of Georgia and the support of the Georgia Bureau of Investigation.

Michael Morgan, formerly an officer at Roxbury Correctional Institution (RCI) in Hagerstown, Md., pleaded guilty today to assaulting an inmate on March 9, 2008, announced the Justice Department and the U.S. Attorney’s Office for the District of Maryland.   Morgan is the 12th former RCI officer to enter a plea in connection with the federal investigation into a series of assaults that the inmate, identified by the initials K.D., suffered at RCI on March 8-9, 2008.  According to court documents filed in connection with his guilty plea, Morgan admitted that he assaulted K.D. by kicking the inmate in the area of his groin.  Morgan acknowledged that he kicked K.D. in order to punish him for his prior misconduct.  Morgan also admitted that he lied under oath in 2008, when he falsely denied both assaulting K.D. and having any knowledge of an assault of the inmate.

“Mr. Morgan has admitted that, as a correctional officer, he – and others – violated a person’s constitutional rights and then lied to cover up their on-duty misconduct,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division.  “The Justice Department will continue to vigorously prosecute officers who use their official position to commit and to cover up violations of federal criminal law.”

Morgan faces a statutory maximum penalty of 10 years in prison.  Sentencing is set for April 23, 2014, before U.S. District Judge James K. Bredar.

In related cases before Judge Bredar, former RCI Correctional Officers Ryan Lohr, Dustin Norris, Philip Mayo, Jeremy McCusker, Walter Steele, Lanny Harris, Keith Morris, Tyson Hinckle and Reginald Martin, and former RCI Lieutenants Robert Harvey and Edwin Stigile each has entered a guilty plea.  Two former RCI officers previously entered guilty pleas in state court.   

Three current or former RCI officers still face federal charges in connection with this incident.  These officers are innocent until proven guilty in a court of law.

The investigation by the Frederick Resident Agency of the FBI is ongoing.  The case is being prosecuted by Special Litigation Counsel Forrest Christian and Trial Attorneys Sanjay Patel and Christine Siscaretti of the Civil Rights Division of the Department of Justice, with the assistance of Michael Cunningham of the U.S. Attorney’s Office for the District of Maryland.

Edwin Stigile, formerly a Lieutenant at Roxbury Correctional Institution (RCI) in Hagerstown, Md., and two former RCI Correctional Officers, Tyson Hinckle and Reginald Martin, each pleaded guilty to an offense arising out of the assault of an inmate on Mar. 9, 2008.  Hinckle pleaded guilty to conspiring to assault an inmate, identified by the initials K.D.  Martin pleaded guilty to failing to intervene to stop the assault of K.D.  Stigile admitted that he was guilty of destroying evidence related to that assault.  Hinckle, Martin and Stigile are the ninth, 10th and 11th former RCI officers to enter a plea in connection with the federal investigation into a series of assaults that K.D. suffered at RCI on Mar. 8-9, 2008. 

According to court documents filed in connection with his guilty plea, Hinckle admitted that, during the 7 a.m.-3 p.m. shift on Mar. 9, 2008, that he, Dustin Norris and three other RCI officers assaulted K.D. in order to punish him for striking an officer during a prior shift.  Hinckle also admitted that this assault in 2008 was consistent with prior incidents at RCI, where officers from three consecutive shifts would beat an inmate who had previously assaulted an officer.  Finally, Hinckle admitted that he and other officers tried to cover up their involvement in, or knowledge of, the assault of K.D.

Martin admitted that, during the 7 a.m.-3 p.m. shift on Mar. 9, 2008, he watched RCI officers assault K.D.  Instead of stopping the assault, however, Martin walked out of K.D.’s cell and waited.  After some time, Martin heard a supervisor say, “He’s had enough.”  The officers then filed out of K.D.’s cell.  Later, when investigators began to ask to about K.D.’s injuries, Martin met with officers who had been involved in the beating and agreed to falsely deny any knowledge of an assault of K.D.

Stigile, a former lieutenant, admitted that he used a magnetic device to alter and destroy surveillance videotapes related to RCI officers’ assaults of inmates, including the beating of K.D.  Stigile also admitted that, when questioned about K.D. in 2012, he provided false and misleading statements to federal investigators and to a federal grand jury.

“Mr. Hinckle and Mr. Martin have admitted their involvement in an unlawful assault of an inmate, and Mr. Stigile has acknowledged that, as a supervisor, he destroyed evidence related to that assault,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division.  “The Justice Department will continue to vigorously prosecute officers who use their official position to commit and to cover up violations of federal criminal law.”

Stigile faces a statutory maximum penalty of 20 years in prison.  Hinckle and Martin each could receive a statutory maximum sentence of 10 years of incarceration.  All will be sentenced before U.S. District Judge James K. Bredar, and their sentencing dates are as follows: Stigile will be sentenced Jun. 17, 2014, Hinckle will be sentenced Apr. 7, 2014 and Martin will be sentenced May 15, 2014.

In related cases before Judge Bredar, former RCI Correctional Officers Ryan Lohr, Dustin Norris, Philip Mayo, Jeremy McCusker, Walter Steele, Lanny Harris, Keith Morris and former RCI Lieutenant Robert Harvey each has entered a guilty plea.  Four current or former RCI officers still face federal charges in connection with the alleged assault of K.D.  Two former RCI officers previously entered guilty pleas in state court.   

The investigation by the Frederick Resident Agency of the Federal Bureau of Investigation is ongoing.  The case is being prosecuted by Special Litigation Counsel Forrest Christian and Trial Attorney Sanjay Patel of the Civil Rights Division, with the assistance of Michael Cunningham of the U.S. Attorney’s Office for the District of Maryland.

United States Attorney ALICIA A.G. LIMTIACO, U.S. Attorney for the Districts of Guam and the Northern Mariana Islands (NMI), announced that Defendant Rosalina M.T. Gabutin, age 45, was sentenced on January 6, 2014, in the District Court of Guam to serve 48 months in federal prison followed by five years of supervised release for her conviction on multiple counts of bank fraud and aggravated identity theft.  Gabutin was also ordered to pay $49,017.17 to the victims of her criminal conduct. 

Gabutin worked as an administrative assistant between 2009 and 2010 with Golden Formosa Jewelry International Guam which rents commercial property.  She stole rental payments from her employer’s commercial tenants, forged checks, and negotiated them with financial institutions.  She also forged her employer’s signature on some of the checks.

Gabutin was also ordered to serve an additional 10 months in prison for a 2010 bank fraud case on account that she committed the above-referenced new bank fraud and aggravated identity theft crimes while she was on supervised release with the U.S. Probation Office for the prior case.

U.S. Attorney Alicia A.G. Limtiaco stated, “Identity theft and related white collar and financial fraud crimes victimize individuals, financial institutions and merchants.  The U.S. Attorney’s Office for the Districts of Guam and the Northern Mariana Islands and the Department of Justice are committed to combating identity theft and other white collar and financial fraud crimes.  We will continue to dedicate federal resources effectively to prevent, investigate and prosecute the unlawful use of identifying information. Federal and local law enforcement are committed to protecting our community and consumers against theft, fraud and other related criminal activity.”

United States Attorney ALICIA A.G. LIMTIACO, U.S. Attorney for the Districts of Guam and the Northern Mariana Islands (NMI), announced that Defendant Rosalina M.T. Gabutin, age 45, was sentenced on January 6, 2014, in the District Court of Guam to serve 48 months in federal prison followed by five years of supervised release for her conviction on multiple counts of bank fraud and aggravated identity theft.  Gabutin was also ordered to pay $49,017.17 to the victims of her criminal conduct. 

Gabutin worked as an administrative assistant between 2009 and 2010 with Golden Formosa Jewelry International Guam which rents commercial property.  She stole rental payments from her employer’s commercial tenants, forged checks, and negotiated them with financial institutions.  She also forged her employer’s signature on some of the checks.

Gabutin was also ordered to serve an additional 10 months in prison for a 2010 bank fraud case on account that she committed the above-referenced new bank fraud and aggravated identity theft crimes while she was on supervised release with the U.S. Probation Office for the prior case.

U.S. Attorney Alicia A.G. Limtiaco stated, “Identity theft and related white collar and financial fraud crimes victimize individuals, financial institutions and merchants.  The U.S. Attorney’s Office for the Districts of Guam and the Northern Mariana Islands and the Department of Justice are committed to combating identity theft and other white collar and financial fraud crimes.  We will continue to dedicate federal resources effectively to prevent, investigate and prosecute the unlawful use of identifying information. Federal and local law enforcement are committed to protecting our community and consumers against theft, fraud and other related criminal activity.”

The Justice Department announced today that two related entities, Michigan-based Cadillac Asphalt LLC (Cadillac) and Michigan Paving and Materials Co. (MPM), have agreed to pay $3.8 million to resolve allegations that they falsely claimed Disadvantaged Business Enterprise (DBE) credits on a number of federally funded transportation projects.  Both Cadillac and MPM are subsidiaries of Oldcastle Materials Inc., a construction material and services provider based in Atlanta. 

 
“The Disadvantaged Business Enterprise program helps businesses owned by minorities and women to work on federally funded projects,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.  “Those who falsely claim credits under the program to obtain federal funds victimize both the taxpayers and the businesses that the program is designed to assist.” 

 
“The U.S. Attorney’s Office works with the Civil Division in Washington to use civil enforcement to recover funds for taxpayers,” said U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade.  “In this case, civil attorneys were able to recover more than $3 million that was obtained through false claims.”

The settlement announced today resolves allegations that Cadillac and MPM knowingly and falsely claimed DBE credit for asphalt purportedly supplied by a DBE known as BN&M Trucking Inc.  As a condition of federal funding, contractors, such as Cadillac and MPM, working on a federally funded project must make a good-faith attempt to meet DBE participation goals.  For the contractors to meet their DBE participation goal, a DBE employed by the contractors must be independently responsible for performing a portion of the work with its own employees and equipment.  Allegedly, BN&M Trucking was merely a pass-through company that did not supply any asphalt or perform any other commercially useful function. 

“We remain steadfast in our commitment to maintaining the integrity of the U.S. Department of Transportation’s (USDOT) Disadvantaged Business Enterprise program,” said regional Special Agent-in-Charge of USDOT’s Office of Inspector General Michelle T. McVicker.  “Working with the Secretary of Transportation, other DOT leaders and our law enforcement colleagues, we will continue to protect the taxpayers’ investment in our nation’s infrastructure from fraud, waste, abuse and violations of law.” 

The allegations resolved by the settlement involved numerous federally funded transportation projects in Michigan between 2006 and 2010, including a project to construct a new runway at Detroit Metropolitan Wayne County Airport in 2008 and 2009.  In November 2010, two other entities, John Carlo Inc. and Angelo Iafrate Construction Co. Inc., paid more than $1 million to resolve similar allegations related to the airport runway project. 

This case was handled by the Justice Department’s Civil Division, Commercial Litigation Branch, the U.S. Attorney’s Office for the Eastern District of Michigan and the Department of Transportation Office of Inspector General.  The claims settled in this case are allegations only; there has been no determination of liability.

Attorney General Eric Holder today announced that the Justice Department collected at least $8 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2013.

“The department’s enforcement actions not only help to ensure justice is served, but also deliver a valuable return to the American people,” said Attorney General Holder. “It is critical that Congress provide the resources necessary to match the department’s mounting caseload. As these figures show, supporting our federal prosecutors is a sound investment.”

The statistics indicate that in FY 2013, approximately $5.9 billion was collected by the department’s litigating divisions and the U.S. Attorneys’ offices in individually and jointly handled civil actions.  The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct and collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. This number includes approximately $3.2 billion related to health care fraud and more than $430 million related to environmental cases.  In addition, civil debts were collected on behalf of several federal agencies, including the Department of Housing and Urban Development, the Department of Health and Human Services, the Internal Revenue Service, the Small Business Administration and the Department of Education.

The Justice Department’s litigating divisions and U.S. Attorneys’ offices are also responsible for enforcing and collecting criminal debts owed to the U.S. and criminal debts owed to federal crime victims. In FY 2013, the total amount collected in criminal actions totaled approximately $2.2 billion in restitution, criminal fines and felony assessments. This total included more than $450 million in criminal fines associated with health care fraud, more than $600 million in antitrust violation fines, more than 390 million in fines for environmental violations and more than $42 million in fines for tax fraud violations.

The approximately $8.1 billion taken in by the department as a whole in FY 2013 represents nearly three times the approximately $2.76 billion of the department’s direct appropriations that pay for the 94 U.S. Attorneys’ offices and its main litigating divisions.

The total includes all monies collected as a result of Justice Department-led enforcement actions and negotiated civil settlements. It includes more than $5.48 billion in payments made directly to the Justice Department, and $2.61 billion in indirect payments made to other federal agencies, states and other designated recipients.

In measuring collections recovered in FY 2013, this figure necessarily includes some cases that were resolved in previous years but the proceeds of which were collected in FY 2013.

FY 2013 Collections Highlights

Health Care Fraud - Abbott, Amgen (Civil Division; U.S. Attorneys Offices)

As in previous years, the largest collections related to health care fraud. For example, the Justice Department collected more than $800 million of its total $1.5 billion settlement with Abbott Laboratories resolving criminal and civil allegations that Abbott illegally promoted the drug Depakote to treat agitation and aggression in elderly dementia patients and schizophrenia when neither of these uses was approved as safe and effective by the FDA. Of the total, Abbott paid a $500 criminal fine in FY 2012 following its guilty plea (the total $1.5 billion settlement also includes nearly $200 million in forfeited assets). In another major pharmaceutical case, the U.S. collected more than $748 million from its total $762 million settlement (including $14 million in forfeited assets) with biotech giant Amgen Inc. to settle allegations including Amgen’s illegal promotion of Aranesp, a drug used to treat anemia, in doses not approved by the FDA and for off-label use to treat non-anemia-related conditions. For details, see Abbott , Abbott sentencing , and Amgen .

Deepwater Horizon (Criminal Division; Environment and Natural Resources Division; Civil Division; U.S. Attorneys Offices)

Among other major collections in FY 2013 were penalties and fines collected from BP Exploration and Production Inc., and Transocean Deepwater Inc., stemming from their roles in the disastrous April 2010 Deepwater Horizon rig explosion in the Gulf of Mexico that cost 11 men their lives and resulted in the largest oil spill in U.S. history.

Out of the $4 billion total criminal settlement with BP, the U.S. collected $256 million in criminal fines in FY 2013 following January 2013 convictions for manslaughter, obstruction of justice and environmental crimes.  The U.S. will recover an additional $1 billion in criminal fines from the resolution over the next four years under the court schedule.  An additional $2.39 billion in non-fine criminal penalties is dedicated to environmental and wildlife conservation efforts in the Gulf, as well as $350 million in spill prevention and response efforts. During FY 2013, BP made initial payments of $105 million towards these additional obligations, and will pay the rest over the next four years, under the court’s schedule.

In FY 2013, the department collected $100 million in criminal fines owed by Transocean for its role in the oil spill.  Transocean also paid $60 million towards an additional $300 million in non-fine criminal penalties slated for Gulf conservation, spill prevention and response efforts, and it paid $404 million of $1 billion in civil penalties imposed under the Clean Water Act.

The efforts to hold accountable those responsible for the disaster continue.  For details, see BP and Transocean settlements.

Price Fixing and Bid Rigging – AU Optronics (Antitrust Division)

Some of the department’s largest collections related to the Antitrust Division’s criminal prosecutions of international conspiracies to fix prices, rig bids and allocate markets.  For example, in FY 2013, the Justice Department collected more than $326 million from its total of $1.39 billion in criminal fines resulting from its investigation into price fixing of thin-film transistor liquid crystal display (LCD) panels. For instance, $250 million was collected in FY 2013 from LCD manufacturer AU Optronics’ $ 500 million total fine for its conviction after an eight-week trial .  For details, see LCD .  In addition, the United States collected more than $124 million in criminal fines in FY 2013 related to the department’s ongoing investigation into price fixing and bid rigging in the automotive parts industry, out of a total of more than $1.6 billion in fines obtained in the investigation through FY 2013.  For details, see Auto Parts .

Tax Conspiracy – Wegelin & Co. (Tax Division)

The U.S. collected more than $42 million in restitution and fines in a single tax case involving Wegelin & Co., a Swiss private bank that pleaded guilty to conspiring with U.S. taxpayers and others to hide more than $1.2 billion in secret Swiss bank accounts and the income generated in these accounts from the Internal Revenue Service (IRS). As part of its guilty plea, Wegelin agreed to pay approximately $20 million in restitution to the IRS and to pay a $22.05 million fine. In addition, Wegelin agreed to the civil forfeiture of an additional $15.8 million, representing the gross fees earned by the bank on the undeclared accounts of U.S. taxpayers.

Detrick and Natashia Tucker, a husband and wife who owned and operated a tax preparation business named T&T Express Tax located in Pine Mountain, Ga., pleaded guilty today to crimes relating to the preparation of false tax returns, announced Assistant Attorney General Kathryn Keneally of the Justice Department's Tax Division and U.S. Attorney Michael J. Moore for the Middle District of Georgia.  Specifically, Detrick Tucker pleaded guilty to aiding and assisting in the preparation of false tax returns, and Natashia Tucker pleaded guilty to conspiring to defraud the United States in the assessment and collection of federal income taxes.

According to court documents, Natashia Tucker admitted that she conspired with Detrick Tucker to fraudulently inflate refunds on their clients’ tax returns in order to increase the popularity of T&T Express Tax and secure more business.  Detrick Tucker contributed to the conspiracy by registering T&T Express Tax with the Internal Revenue Service (IRS) so that the false returns could be electronically filed and by performing managerial duties.  He also applied for an Electronic Filing and Identification Number and a Preparer Tax Identification Number rather than Natashia Tucker because she is a convicted felon.  Detrick Tucker then knowingly allowed Natashia Tucker to use these IRS registration numbers to file tax returns for clients as well as for her own 2010 and 2011 false tax returns.  Natashia Tucker was the main tax return preparer at T&T Express Tax, and she prepared the majority of the false tax returns at the business primarily by abusing the Earned Income Tax Credit and by creating false business information for her clients.  During its three years of operation, T&T Express Tax filed over 2,200 federal tax returns that claimed over $1,000,000 in false refunds. 

Detrick Tucker faces a statutory maximum potential sentence of three years in prison for his conviction for aiding and assisting in the preparation of false tax returns.  Natashia Tucker faces a statutory maximum potential sentence of five years in prison for her conspiracy conviction.  They are both also subject to fines and mandatory restitution.  U.S. District Judge Clay Land scheduled the Tuckers’ sentencing for Mar. 25, 2014.

The case was investigated by special agents of the IRS-Criminal Investigation and the Georgia Department of Revenue.  Trial Attorneys Alexander Effendi and Charles Edgar Jr. of the Justice Department’s Tax Division are prosecuting the case.

Additional information about the Tax Division and its enforcement efforts may be found at www.justice.gov/tax .