District Not Recorded

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WASHINGTON – Corey Thompson was sentenced today to serve 30 months in prison for his involvement in a sophisticated stolen identity refund fraud conspiracy, the Justice Department and the Internal Revenue Service (IRS) announced. In July 2012, Thompson pleaded guilty to one count of conspiracy to file false claims and to one count of aggravated identity theft.

According to court documents, in January 2012, Thompson and his co-conspirators filed at least 27 fraudulent 2011 tax returns that requested a total of $91,304 in refunds. Thompson and his co-conspirators obtained the means of identification from a prison guard and from an employee at a debt collection agency.

Court documents also state that in 2011 and 2012, Thompson worked as an independent contractor for a cable company. As an independent contractor, Thompson installed cable and internet access. To perpetrate the conspiracy, Thompson hijacked the internet service of customers for whom he had performed work. From his home, Thompson used his laptop and his specialized knowledge and equipment to essentially shut down the customer’s internet and then take over that customer's internet. Thompson would then file false tax returns using the hijacked internet which made it appear as if the false tax returns were being filed by the customer. Thompson directed the tax refunds to be placed on pre-paid debit cards. The pre-paid debit cards were intercepted by the U.S. Postal Service.

The case was investigated by Special Agents of the IRS - Criminal Investigation and Postal Inspectors of the U.S. Postal Service. Trial attorneys Jason H. Poole, Justin Gelfand and Michael Boteler of the Justice Department's Tax Division and Assistant U.S. Attorney Jared Morris prosecuted the case.

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

A former health care clinic director and licensed clinical psychologist pleaded guilty today in connection with a health care fraud scheme involving defunct health provider Health Care Solutions Network Inc. (HCSN), announced 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; Michael B. Steinbach, Special Agent in Charge 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.

Alina Feas, 53, of Miami, pleaded guilty before U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida to one count of conspiracy to commit health care fraud and one substantive count of health care fraud. 

During the course of the conspiracy, Feas was employed as a therapist and clinical director of HCSN’s Partial Hospitalization Program (PHP).  A PHP is a form of intensive treatment for severe mental illness.  HCSN operated two community mental health centers in Florida and one community mental health center in North Carolina.

In her capacity as clinical director, Feas oversaw the entire clinical program and supervised therapists and other personnel at HCSN in Florida (HCSN-FL).  Feas also conducted group therapy sessions when therapists were absent. 

According to court documents, Feas was aware that HCSN-FL paid illegal kickbacks to owners and operators of assisted living facilities (ALF) in Miami-Dade County in exchange for patient referral information to be used to submit false and fraudulent claims to Medicare and Medicaid.  Feas knew that many of the ALF referral patients were ineligible for PHP services because they suffered from either mental retardation, dementia or Alzheimer's disease, which are not effectively treated by PHP services. 

Court documents reveal that Feas submitted claims to Medicare for individual therapy she purportedly provided to HCSN-FL patients using her personal Medicare provider number, knowing that HCSN-FL was simultaneously billing the same patients for PHP services.  Feas continued to bill Medicare under her personal provider number while HCSN in North Carolina (HCSN-NC) simultaneously submitted false and fraudulent PHP claims.

Feas was aware that HCSN-FL personnel were fabricating patient medical records, according to court documents. Many of these medical records were created weeks or months after the patients were admitted to HCSN-FL for purported PHP treatment and were utilized to support false and fraudulent billing to government sponsored health care benefit programs, including Medicare and Florida Medicaid.  During her employment at HCSN-FL, Feas signed fabricated PHP therapy notes and other medical records used to support false claims to government sponsored health care programs.

At HCSN-NC, Feas was aware that her co-conspirators were fabricating medical records to support the fraudulent claims she was causing to be submitted to Medicare.  Feas was aware that a majority of the fabricated notes were created at the HCSN-FL facility for patients admitted to HCSN-NC.  In some instances, Feas signed therapy notes and other medical records even though she never provided services at HCSN-NC. 

According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services.

Fifteen defendants have been charged for their alleged roles in the HCSN health care fraud scheme, and 13 defendants have pleaded guilty.  On April 25, 2013, Wondera Eason was convicted, following a five-day jury trial, on one count of conspiracy to commit health care fraud for her role in the scheme at HCSN.  Alleged co-conspirator Lisset Palmero is scheduled for trial on June 3, 2013.  Defendants are presumed innocent until proven guilty at trial.

This case was prosecuted by Trial Attorney Allan J. Medina and former Special Trial Attorney William J. Parente.  This case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division's Fraud Section and the U.S. Attorney's Office for the Southern District of Florida. 
  
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion.  In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

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

A former medical doctor pleaded guilty today in Washington, D.C., to engaging in illicit sexual conduct in Kenya, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney for the District of Columbia Ronald C. Machen Jr. and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office. 

John D. Ott, 67, pleaded guilty before U.S. District Judge Reggie B. Walton in the District of Columbia to one count of engaging in illicit sexual conduct in a foreign place.  Ott was charged in an information filed on March 21, 2012.

According to filed court documents and proceedings, Ott was a former medical doctor who worked for non-governmental organizations and hospitals in Kenya.  Court records show that Ott also started an orphanage in Kenya.  Ott admitted that between approximately January 2004 and September 2012, he engaged in illicit sexual conduct in Muhuru Bay, Sori and Kendu Bay, Kenya, with at least 14 minors, who ranged in age from approximately nine to 17 years old when the illicit sexual conduct began.  Ott admitted that he frequently paid for schooling and provided other financial support, including housing, for minors with whom he engaged in illicit conduct.

Ott has been in federal custody since he was arrested in December 2012, following his deportation from Tanzania.  Engaging in illicit sexual conduct in a foreign place carries a maximum penalty of 30 years in prison and a $250,000 fine.  Ott’s sentencing has been scheduled for July 26, 2013.

The case is being prosecuted by Trial Attorney Keith A. Becker of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Ari Redbord of the District of Columbia.  The investigation was conducted by the FBI’s Washington Field Office.  Significant assistance was provided by the Criminal Division’s Office of International Affairs.

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.

The Justice Department reached a settlement agreement today with DeKalb County, Ga., school district to resolve the department’s investigation into allegations of religious and national origin harassment of a Sikh middle school student. Counsel for the Sikh Coalition filed the complaint with the department, alleging that the student had been repeatedly targeted with verbal and physical harassment because of his Sikh faith. The department has authority to investigate and resolve complaints of religious and national origin harassment through its enforcement of Title IV of the Civil Rights Act of 1964.

 

Following an inquiry into the student-specific complaints, the department notified the district of its concerns that the district had failed to respond promptly and appropriately to the Sikh Coalition’s allegations of harassment, including allegations that the student was called “Aladdin” because he wore a turban and was told by a fellow student to “go back to his country.” The department also raised concerns that the district had not investigated witness statements that the student had been called a “terrorist” and that there was a history of fellow students targeting him because of his turban. The department also found that the disciplinary measures the district did take had not been effective in ending the harassment, and that the student feared continued harassment.

 

The district worked cooperatively with the department to resolve the complaint and ensure greater protections for the student. The settlement agreement, which will be in effect until the end of the 2014-2015 school year, requires the district to: work with a consultant to develop and implement anti-harassment training at the student’s middle and high school; immediately implement a safety plan to ensure that the student is safe at school and, should incidents of harassment occur, that the district responds quickly and effectively; and meet with the student, his family, and administrators from his middle school and the high school where he will enroll, to identify key school personnel who can support the student should any future incidents of harassment occur. The department has opened a separate and ongoing inquiry into whether the district’s anti-harassment policies meet federal standards, whether its policies are consistently implemented, and whether employees are adequately trained to implement those policies.

 

“Students of all faiths must be protected from harassment and other forms of discrimination,” said Jocelyn Samuels, Principal Deputy Assistant Attorney General for the Civil Rights Division.  “We commend the district for stepping forward and putting student safety first. We are encouraged by the district’s resolve to support and provide anti-harassment training on issues facing students from the Sikh, Muslim, Arab-American and South Asian communities.”   

 

“Every student should be able to attend school without fear of being harassed and bullied because of his skin color or religious beliefs,” said United States Attorney Sally Quillian Yates. “I am encouraged by DeKalb County’s willingness to take immediate steps to ensure that students attending DeKalb County schools are free of this type of harassment and bullying.”

 

The enforcement of Title IV is a top priority of the Justice Department’s Civil Rights Division. Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt .

Related Materials:

DeKalb Settlement Agreement

FALLS CHURCH, Va. – The Executive Office for Immigration Review (EOIR) today announced the investiture of five immigration judges. Chief Immigration Judge Brian M. O’Leary presided over the investiture during a ceremony held at EOIR’s headquarters on May 3, 2013.

After a thorough application process, Attorney General Eric Holder appointed Timothy R. Everett, J. Traci Hong, Amy T. Lee, Elizabeth H. McGrail and John C. Odell to their new positions. “EOIR is committed to continuing to apply its resources toward its primary mission,” said O’Leary. “The arrival of these five professionals brings our immigration judge corps to nearly 260, all of whom will work to help mitigate EOIR’s pending caseload.”

Biographical information follows.

Timothy R. Everett, Immigration Judge, Los Angeles Immigration Court

Attorney General Eric Holder appointed Judge Everett in April 2013. Judge Everett received a bachelor of arts degree in 1980 from Louisiana State University; a master of arts degree and a juris doctorate in 1986 from Tulane University and Tulane University Law School respectively; and a master of studies in environmental law in 2000 from Vermont Law School. From March 2009 to April 2013, Judge Everett served as an assistant chief counsel, Department of Homeland Security, U.S. Immigration and Customs Enforcement, Los Angeles. From January 2000 to March 2009, he was a solo practitioner in Los Angeles. During that time from March 2000 to December 2000, he was an interim directing attorney for the Central American Resource Center in Los Angeles. From August 1999 to December 1999, Judge Everett worked as a legal intern at the National Wildlife Foundation in Washington, D.C. From May 1996 to August 1998, he was a solo practitioner in Los Angeles. From May 1991 to May 1996, Judge Everett served as a directing attorney of the Domestic Legal Department at El Rescate Legal Services in Los Angeles. From April 1990 to May 1991, he was a staff attorney at Ayuda Legal Services in Washington, D.C. From 1989 to 1990, he served as an associate attorney at the Law Office of William Van Wyke in Washington, D.C. Judge Everett is a member of the State Bar of California and the Florida Bar.

J. Traci Hong, Immigration Judge, Los Angeles Immigration Court

Attorney General Eric Holder appointed Judge Hong in April 2013. Judge Hong received a bachelor of arts degree in 1992 from The University of Texas at Austin and a juris doctorate in 1995 from The University of Texas School of Law. From February 2011 to April 2013, she served as a senior policy advisor for the Department of Homeland Security, Office for Civil Rights and Civil Liberties in Washington, D.C. From March 2007 to January 2011, Judge Hong served as counsel for the U.S. House of Representatives, Committee on the Judiciary, Subcommittee on Immigration, Citizenship, Refugees, Border Security, and International Law. From June 2003 to March 2007, she worked for the Asian American Justice Center in Washington, D.C. as an immigration staff attorney and the immigration program director. From January 2000 to May 2003, Judge Hong was a staff attorney for the American Immigration Law Foundation in Washington, D.C. From August 1995 to December 1999, she practiced immigration law with the law firm of Tidwell Swaim & Associates, P.C., in Dallas. Judge Hong is a member of the State Bar of Texas.

Amy T. Lee, Immigration Judge, Los Angeles Immigration Court

Attorney General Eric Holder appointed Judge Lee in April 2013. Judge Lee received a bachelor of arts degree in 1992 from Stanford University; a juris doctorate in 1995 from University of the Pacific, McGeorge School of Law; and a master of public administration in 2001 from California State University, East Bay. From February 2008 to April 2013, she was an attorney with Fallon, Bixby, Cheng & Lee, Inc. in San Francisco. From January 2006 to February 2008, Judge Lee was an attorney with the Law Offices of David M. Lederman in Antioch, Calif. From January 2005 to December 2005, she was a solo practitioner in Oakland, Calif. From January 2001 to January 2005, Judge Lee served as senior corporate counsel for PeopleSoft, Inc. From September 1995 to December 2000, she served as an assistant district counsel for the Department of Justice, U.S. Immigration and Naturalization Service, in San Francisco. Judge Lee is a member of the State Bar of California.

Elizabeth H. McGrail, Immigration Judge, Los Angeles Immigration Court

Attorney General Eric Holder appointed Judge McGrail in April 2013. Judge McGrail received a bachelor of arts degree in 1985 from Vanderbilt University and a juris doctorate in 1989 from the College of William and Mary, Marshall-Wythe School of Law. From 2008 to April 2013, she served as legal director at Capital Area Immigrants’ Rights Coalition (CAIR Coalition) in Washington, D.C. From 2007 to 2008, Judge McGrail served as an of counsel for the Law Office of Richard S. Bromberg in Washington, D.C. From 2005 to 2007, she served as the detention project director and legal consultant for CAIR Coalition. From 1994 to 2005, Judge McGrail was a solo practitioner in Washington, D.C. From 1991 to 1994, she was an associate at Wasserman, Mancini & Chang in Washington, D.C. From 1989 to 1990, Judge McGrail was an associate at Brown & Wood in New York. Judge McGrail is a member of the District of Columbia Bar.

John C. Odell, Immigration Judge, Tacoma Immigration Court

Attorney General Eric Holder appointed Judge Odell in April 2013. Judge Odell received a bachelor of science degree in 1983 from the United States Coast Guard Academy and a juris doctorate in 1994 from the Seattle University School of Law. From October 2007 to April 2013, he served as an assistant chief counsel, Department of Homeland Security, U.S. Immigration and Customs Enforcement, in Seattle, Wash., where, from December 2008 to December 2010, he served as a special assistant U.S. attorney. From 1997 to 2007, Judge Odell served in the U.S. Coast Guard where he held various legal positions, including staff judge advocate, 13th Coast Guard District, Seattle, and Coast Guard Academy, New London, Conn.; military judge, U.S. Coast Guard; senior defense counsel, Naval Legal Services Office, Bremerton, Wash.; and assistant legal officer, 13th Coast Guard District. Judge Odell is a member of the Washington State Bar.

- 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.

Executive Office for Immigration Review

A patient recruiter for a Miami health care company was sentenced today to serve 37 months in prison for his participation in a $20 million Medicare fraud scheme, announced 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; Michael B. Steinbach, Special Agent in Charge 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.

Manuel Lozano, 65, was sentenced by U.S. District Judge Joan A. Lenard in the Southern District of Florida.  In addition to his prison term, Lozano was sentenced to serve two years of supervised release and ordered to pay $1,851,000 in restitution, jointly and severally with co-conspirators.

In February 2013, Lozano pleaded guilty to one count of conspiracy to receive health care kickbacks.

According to court documents, Lozano was a patient recruiter who worked for Serendipity Home Health, a Miami home health care agency that purported to provide home health and therapy services to Medicare beneficiaries.

According to court documents, from approximately April 2007 through March 2009, Lozano recruited patients for Serendipity, and in doing so he solicited and received kickbacks and bribes from the owners and operators of Serendipity in return for allowing the company to bill the Medicare program on behalf of the patients he recruited.  These Medicare beneficiaries were billed for home health care and therapy services that were medically unnecessary and/or not provided.

From approximately January 2006 through March 2009, Serendipity submitted approximately $20 million in claims for home health services that were not medically necessary and/or not provided, and Medicare paid approximately $14 million for these fraudulent claims. As a result of Lozano’s participation in the illegal scheme, the Medicare program was fraudulently billed more than $1 million but less than $2.5 million for purported home health care services.

 In a related case, on June 21, 2012, Ariel Rodriguez and Reynaldo Navarro, the owners and operators of Serendipity, were sentenced to 73 and 74 months in prison, respectively, and ordered to pay $14 million in restitution and severally with each other and their co-defendants, Melissa Rodriguez and Ysel Salado. Ariel and Melissa Rodriguez, Navarro and Salada each pleaded guilty in March 2012 to one count conspiracy to commit health care fraud.

This case is being prosecuted by Assistant Chief Joseph S. Beemsterboer of the Criminal Division’s Fraud Section.  The case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

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

NEW YORK -- Immigration Judge Terry Bain from the Executive Office for Immigration Review, New York Immigration Court, delivered the keynote speech and administered the oath of allegiance to approximately 150 candidates during a naturalization ceremony at 26 Federal Plaza in New York on May 3, 2013. The New York District Office of U.S. Citizenship and Immigration Services, Department of Homeland Security, hosted the ceremony.

Biographical Information

Attorney General Janet Reno appointed Judge Bain in February 1994. Judge Bain received a bachelor of arts degree in 1973 from George Washington University, and a juris doctorate in 1980 from Brooklyn Law School. From 1986 to 1994, she worked as an attorney for Whitman, Breed, Abbott & Morgan in New York. From 1981 to 1986, she worked in private practice with Barst & Mukamal in New York. Judge Bain is a member of the New York State Bar.

- 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.

Executive Office for Immigration Review

The Justice Department announced today that it will monitor elections on May 7, 2013, in the towns of Clarksdale, Como and Ruleville, Miss., and in Charleston County, S.C., to ensure compliance with the Voting Rights Act of 1965. The Voting Rights Act prohibits discrimination in the election process on the basis of race, color or membership in a minority language group.

 

Under the Voting Rights Act, the Justice Department is authorized to ask the U.S. Office of Personnel Management (OPM) to send federal observers to jurisdictions that are certified by the attorney general or by a federal court order.  Federal observers will be assigned to monitor polling place activities in Clarksdale, Como and Ruleville based on the attorney general’s certification. The observers will watch and record activities during voting hours at polling locations, and Civil Rights Division attorneys will coordinate the federal activities and maintain contact with local election officials.

 

In addition, Justice Department personnel will monitor polling place activities in Charleston County. A Civil Rights Division attorney will coordinate federal activities and maintain contact with local election officials.

 

Each year, the Justice Department deploys hundreds of federal observers from OPM, as well as departmental staff, to monitor elections across the country.  To file complaints about discriminatory voting practices, including acts of harassment or intimidation, voters may call the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.

 

Visit www.justice.gov/crt/voting/index.php for more information about the Voting Rights Act and other federal voting laws.

The mastermind of a $29.1 million Medicare fraud scheme involving approximately 30 purported medical clinics pleaded guilty today in Detroit for his role in the scheme.

The guilty plea was announced by Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Robert D. Foley III of the FBI’s Detroit Field Office; Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Chicago Regional Office; and Special Agent in Charge Erick Martinez of the Internal Revenue Service Criminal Investigation (IRS-CI) Detroit Field Office.

Sachin Sharma, 37, of Detroit, pleaded guilty before U.S. District Judge Denise P. Hood in the Eastern District of Michigan to one count of conspiracy to commit health care fraud and one count of tax evasion. 

According to court documents, Sharma oversaw and directed operations of a broad network of home health, psychotherapy and other purported medical clinics in and around Detroit, including Reliance Home Care LLC, First Choice Home Health Care Services Inc. and Haven Adult Day Care Center LLC.  Working with co-conspirators, Sharma created and/or operated these companies for the purpose of billing Medicare for home health and psychotherapy services that Sharma knew were not provided.  Court documents show that Sharma paid kickbacks to patient recruiters in order to obtain the information of Medicare beneficiaries, which he then used at these companies to bill Medicare for services that were not medically necessary and/or were not provided to these beneficiaries. 

Court documents show that Sharma trained others on techniques to defraud Medicare and to conceal the fraud, and directed employees to fabricate and alter medical documents to give the false impression that home health and psychotherapy services were provided when, in fact, they were not. 

Sharma admitted that from 2007 through 2011, he received substantial proceeds of the fraud from these companies, but failed to report these proceeds on his individual federal income tax returns.  Sharma admitted that he filed no individual income tax returns from 2007 through 2011.

Court documents allege that between 2007 and 2012, Sharma caused these companies to submit approximately $29,171,017 in claims to Medicare for services that were not medically necessary and/or not provided. 

At sentencing, scheduled for Aug. 8, 2013, Sharma faces a maximum penalty of 10 years in prison and a $250,000 fine.

Sachin Sharma’s co-defendants Dana Sharma, Beverly Cooper and Clarence Cooper each previously pleaded guilty to one count of conspiracy to commit health care fraud for their roles in the scheme.  Co-defendants Abdul Malik al-Jumail, aka “Tony,” Felicar Williams and Jamella al-Jumail are scheduled for trial on June 10, 2013.  Co-defendant Firas Alky remains a fugitive.  Defendants are presumed innocent unless and until proven guilty at trial.

This case is being prosecuted by Trial Attorney William G. Kanellis and Deputy Chief Gejaa Gobena of the Criminal Division’s Fraud Section, with assistance from the Department of Justice Tax Division.  It was investigated by the FBI, HHS-OIG, and IRS-CI, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

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

The Justice Department announced today that, as part of its Barrier-Free Health Care Initiative, it has reached a settlement agreement with another health care provider, Medical Facilities of America XXIX Limited Partnership, t/a Burke Health and Rehabilitation Center in Burke, Va., to ensure that they provide effective communication to people who are deaf or have hearing loss. This settlement resolves allegations that Burke refused to provide a sign language interpreter for Melvin Warden, who is deaf, when a request was made on his behalf by Inova Fairfax via the AllScripts/Ecin system. This settlement addresses the requirements of the Americans with Disabilities Act (ADA) for health care providers, such as hospitals, rehabilitation centers, medical clinics, nursing homes and doctor’s offices, to provide effective communication to people who are deaf or have hearing loss in the provision of medical services.

 

The Department of Justice’s Barrier-Free Health Care Initiative is a partnership of the Civil Rights Division and U.S. Attorney’s offices across the nation to target enforcement efforts on a critical area for individuals with disabilities. The initiative, launched on the 22nd anniversary of the ADA in July 2012, includes the participation of more than 40 U.S. Attorney’s offices. 

 

To date, the department has entered into seven similar settlements with eight health care providers from across the United States regarding communication with people who are deaf or have hearing loss. In addition, the department reached four agreements in five weeks with health care providers regarding discrimination against individuals with HIV.

 

“Disability-based discrimination in health care is illegal under the Americans with Disabilities Act and may further compromise a person’s health when it limits a person’s full access to medical services,” said Eve L. Hill, Senior Counselor to the Assistant Attorney General for the Civil Rights Division. “The Department of Justice is committed to ensuring that all persons with disabilities are provided with equal access to health care services.”

 

Title III of the ADA requires health care providers to ensure that their communications with people with hearing disabilities are as effective as their communications with people without disabilities. To meet this obligation, health care providers, as well as other public accommodations, must provide auxiliary aids and services unless doing so would cause an undue burden to the facility or fundamentally alter the service being provided. The health care provider may not charge the individual with a disability for the cost of the auxiliary aid or service, including a sign language interpreter.

 

Under this settlement agreement, Burke will ensure effective communication, including providing qualified sign language interpreters, free of charge, to individuals who are deaf or who have hearing loss; establish a contract for the provision of sign language interpreter services; ensure that, for the duration of a patient’s treatment at Burke, at least one qualified sign language interpreter is available or on call for a patient or companion who is deaf or has hearing loss and whose primary means of communication is sign language; and train all staff on the provisions of the effective communication policy and procedures and the effective communication requirements of the ADA.

  

The department has a number of publications available to assist entities to comply with the ADA, including: a Business Brief on Communicating with People Who Are Deaf or Hard of Hearing in Hospital Settings, www.ada.gov/hospcombr.htm ; publications specific to health care providers, HIV discrimination, and effective communication with individuals with hearing and vision disabilities; and publications about tax credits available for providing access.  For more information on the ADA and to access these publications, visit www.ada.gov .  The Barrier-Free Health Care Initiative settlement agreements may be found at www.ada.gov/settlemt.htm .  For more information on the Barrier Free Health Care Initiative visit www.ada.gov/usao-agreements.htm .  Those interested in finding out more about these settlements or the obligations of public accommodations under the ADA may also call the Justice Department’s toll-free ADA information line at 800-514-0301 or 800-514-0383 (TDD), or access its ADA website at www.ada.gov .   ADA complaints may also be filed by email to ada.complaint@usdoj.gov .

Algerian national Hamza Bendelladj, aka “Bx1,” has been extradited from Thailand to the United States to face charges in Atlanta for allegedly playing a critical role in developing, marketing, distributing and controlling “SpyEye,” a pernicious computer virus designed to steal unsuspecting victims’ financial and personally identifying information.

 The charges were announced today by Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Sally Quillian Yates of the Northern District of Georgia and FBI Special Agent in Charge Mark F. Giuliano of the Atlanta Field Office.

Bendelladj, 24, has been charged in a 23-count indictment that was returned on Dec. 20, 2011, and unsealed today.  The indictment charges Bendelladj with one count of conspiring to commit wire and bank fraud, 10 counts of wire fraud, one count of conspiracy to commit computer fraud and 11 counts of computer fraud.  Bendelladj is scheduled to be arraigned today in U.S. District Court in the Northern District of Georgia before U.S. Magistrate Judge Janet F. King.

On Jan. 5, 2013, Bendelladj was apprehended at Suvarnabhumi Airport in Bangkok, Thailand, while he was in transit from Malaysia to Egypt.  He was extradited from Thailand to the United States on May 2, 2013.

“Hamza Bendelladj has been extradited to the United States to face charges of controlling and selling a nefarious computer virus designed to pry into computers and extract personal financial information,” said Acting Assistant Attorney General Raman.  “The indictment charges Bendelladj and his co-conspirators with operating servers designed to control the personal computers of unsuspecting individuals and aggressively marketing their virus to other international cybercriminals intent on stealing sensitive information.  The extradition of Bendelladj to face charges in the United States demonstrates our steadfast determination to bring cybercriminals to justice, no matter where they operate.”

“No violence or coercion was used to accomplish this scheme, just a computer and an Internet connection,” said U.S. Attorney Yates.  “Bendelladj’s alleged criminal reach extended across international borders, directly into victims’ homes.  In a cyber-netherworld, he allegedly commercialized the wholesale theft of financial and personal information through this virus which he sold to other cybercriminals.  Cybercriminals take note; we will find you.  This arrest and extradition demonstrates our determination to bring you to justice.”

“The FBI has expanded its international partnerships to allow for such extraditions of criminals who know no borders,” said FBI Special Agent in Charge Giuliano.  “The federal indictment and extradition of Bendelladj should send a very clear message to those international cyber-criminals who feel safe behind their computers in foreign lands that they are, in fact, within reach.”

According to court documents, the SpyEye virus is malicious computer code or “malware,” which is designed to automate the theft of confidential personal and financial information, such as online banking credentials, credit card information, usernames, passwords, PINs and other personally identifying information.  The SpyEye virus facilitates this theft of information by secretly infecting victims’ computers, enabling cybercriminals to remotely control the computers through command and control (C&C) servers.  Once a computer is infected and under the cybercriminals’ control, a victim’s personal and financial information can be surreptitiously collected using techniques such as “web injects,” which allow cybercriminals to alter the display of web pages in the victim’s browser  in order to trick them into divulging personal information related to their financial accounts.  The financial data is then transmitted to the cybercriminals’ C&C servers, where  criminals use it to steal money from the victims’ financial accounts. 

According to court documents, from 2009 to 2011, Bendelladj and others allegedly developed, marketed and sold various versions of the SpyEye virus and component parts on the Internet and allowed cybercriminals to customize their purchases to include tailor-made methods of obtaining victims’ personal and financial information.  Bendelladj allegedly advertised the SpyEye virus on Internet forums devoted to cybercrime and other criminal activities.  In addition, Bendelladj allegedly operated C&C servers, including a server located in the Northern District of Georgia, which controlled computers infected with the SpyEye virus.  One of the files on Bendelladj’s C&C server in the Northern District of Georgia allegedly contained information from approximately 253 unique financial institutions.

If convicted, Bendelladj faces a maximum sentence of up to 30 years in prison for conspiracy to commit wire and bank fraud; up to 20 years for each wire fraud count; up to five years for conspiracy to commit computer fraud; up to five or 10 years for each count of computer fraud; and fines of up to $14 million dollars.

The public is reminded that the indictment contains only allegations, and the defendant is presumed innocent unless and until proven guilty.

This case is being investigated by the FBI and is being prosecuted by Special Assistant U.S. Attorney Nicholas Oldham and Assistant U.S. Attorney Scott Ferber of the Northern District of Georgia, and Trial Attorney Carol Sipperly of the Criminal Division’s Computer Crime and Intellectual Property Section.  Valuable assistance was provided by the Criminal Division’s Office of International Affairs, which worked with its international counterparts to effect the extradition.

A former consultant for Willbros International Inc. (Willbros International), a subsidiary of Houston-based Willbros Group Inc. (Willbros), was sentenced today for his role in a conspiracy to pay more than $6 million in bribes to government officials of the Federal Republic of Nigeria and officials from a Nigerian political party, Acting Assistant Attorney General Mythili Raman of the Criminal Division and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office announced today.

Paul G. Novak, 46, was sentenced today to serve 15 months in prison by U.S. District Judge Simeon T. Lake III of the Southern District of Texas.  The court took into consideration Novak’s cooperation, and the sentence was consistent with the government’s recommendation. In addition to the prison sentence, Novak was ordered to pay a $1 million fine and to serve two years of supervised release following his release from prison.  In sentencing Novak, the court took into consideration the assistance Novak provided the government in ongoing investigations.

Novak pleaded guilty to one count of conspiracy to violate the Foreign Corrupt Practices Act (FCPA) and one substantive count of violating the FCPA. Novak admitted that from approximately late-2003 to March 2005, he conspired with others to make a series of corrupt payments totaling more than $6 million to various Nigerian government officials and officials from a Nigerian political party to assist Willbros and its joint venture partner, a construction company based in Mannheim, Germany, in obtaining and retaining the Eastern Gas Gathering System (EGGS) Project, which was valued at approximately $387 million. The EGGS project was a natural gas pipeline system in the Niger Delta designed to relieve existing pipeline capacity constraints.

According to court records, Novak and his alleged co-conspirators Kenneth Tillery, Jason Steph, Jim Bob Brown, three employees from Willbros’s joint venture partner and others agreed to make the corrupt payments to, among others, government officials from the Nigerian National Petroleum Corporation, the National Petroleum Investment Management Services, a senior official in the executive branch of the federal government of Nigeria, and members of a Nigerian political party.  Court documents state the bribes were paid to assist in obtaining and retaining the EGGS contract and additional optional scopes of work.

According to information contained in plea documents, to secure the funds for those corrupt payments, Novak and his alleged conspirators caused Willbros West Africa Inc., a subsidiary of Willbros International, to enter into so-called “consultancy agreements” with two consulting companies Novak represented in exchange for purportedly legitimate consultancy services. In reality, those consulting companies were used to facilitate the payment of bribes.

In addition to Novak, to date, two Willbros employees have pleaded guilty for their roles in the EGGS bribery scheme, and Willbros has entered into a deferred prosecution agreement with the government:

• On May 14, 2008, Willbros Group Inc. and Willbros International entered into a deferred prosecution agreement with the government and agreed to pay a $22 million penalty, in connection with the company’s payment of bribes to government officials in Nigeria and Ecuador.  On March 30, 2012, the government moved to dismiss the charges following Willbros’s satisfaction of its obligations under the deferred prosecution agreement, and on April 2, 2012, the Court granted the United States’ motion.   
• On Sept. 14, 2006, Jim Bob Brown, a former Willbros executive, pleaded guilty to one count of conspiracy to violate the FCPA, in connection with his role in making corrupt payments to Nigerian government officials to obtain and retain the EGGS contract and in connection with his role in making corrupt payments in Ecuador. After a reduction for cooperation, Brown was sentenced on Jan. 28, 2010, to 12 months and one day in prison, two years of supervised release and a $17,500 fine.
• On Nov. 5, 2007, Jason Steph, also a former Willbros executive, pleaded guilty to one count of conspiracy to violate the FCPA, in connection with his role in making corrupt payments to Nigerian government officials to obtain and retain the EGGS contract. After a reduction for cooperation, Steph was sentenced on Jan. 28, 2010, to 15 months in prison, two years of supervised release and a $2,000 fine.

Kenneth Tillery was charged, along with Novak, for his alleged role in the bribery scheme in an indictment unsealed on Dec. 19, 2008. According to the indictment, Tillery was a Willbros International employee and executive from the 1980s through January 2005. From 2002 until January 2005, Tillery served as executive vice president and, later, as president of Willbros International. Tillery remains a fugitive. The charges against Tillery are merely accusations, and he is presumed innocent unless and until proven guilty.

The case is being investigated by FBI agents who are part of the Washington Field Office’s dedicated FCPA squad.  Significant assistance was provided by the Criminal Division’s Office of International Affairs. This case is being prosecuted by Senior Trial Attorney Laura N. Perkins of the Criminal Division’s Fraud Section.

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

A federal court in Los Angeles has entered an order permanently barring Simon Jenkins from preparing federal income tax returns and other tax-related documents for others, the Justice Department announced today. Jenkins, who operated under the business name “Jenkins Tax Service” in Gardena , Calif., consented to the civil injunction order, which was signed by U.S. District Judge Dean D. Pregerson.

The government complaint, filed on Feb. 1, 2013, alleged that Jenkins engaged in a pattern of claiming false deductions, false credits, false expenses, and false claims for refunds on behalf of his customers for the tax years 2004 through 2008, causing the government to incur a tax loss of $238,024 for those years.

In addition to barring Jenkins from preparing tax returns, Judge Pregerson also required Jenkins to contact his customers and inform them of the entry of the Permanent Injunction within thirty days.

As noted in the complaint, in a prior related criminal proceeding, Jenkins pleaded guilty to one count of aiding and assisting in the preparation and presentation of false income tax returns. According to the plea agreement, filed in the criminal case on June 15, 2011, Jenkins agreed to enter into a binding civil injunction, barring him for life from aiding or assisting in the preparation of federal income tax returns for anyone other than himself and his legal spouse, and barring him from representing persons before the Internal Revenue Service.

In the past decade the Justice Department’s Tax Division has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department website .

Related Materials:

United States v. Simon Jenkins
Complaint for Permanent Injunction and Other Relief (PDF)
Stipulated Order of Permanent Injunction (PDF)

 Attorney General Eric Holder is traveling to Auckland, New Zealand, for the Fifth Annual Meeting of the Quintet of Attorneys General of the United States, the United Kingdom, Canada, Australia and New Zealand.  The central theme of the Quintet meeting will be strategies for combatting sexual violence against women and children. The Attorneys General will be exchanging best practices for domestic investigations and prosecutions of these serious crimes, as well as working to improve their joint response to transnational sexual violence, including in the contexts of human trafficking, online child pornography and armed conflicts.   

“The Quintet of Attorneys General is one of our most important channels for enhancing cooperation with key allies in the fight against terrorism and transnational crime,” said Attorney General Holder. “One of my highest priorities as Attorney General has been to work to prevent and to punish sexual violence against women and children. I greatly value this opportunity to meet with my counterparts from the United Kingdom, Canada, Australia and New Zealand – countries with which we share both common values and a common legal tradition – to discuss how we can improve our cooperation, with each other and with countries around the world, in the vital effort to fight sexual violence against women and children.”

Under the leadership of Attorney General Holder, the Justice Department has made significant strides in punishing and preventing sexual violence as well as assisting victims of sexual violence, including through the Sexual Assault Forensic Examination Protocol (SAFE), the Sexual Assault Backlog Initiative, the Defending Childhood Initiative, the expanded Project Safe Childhood as well as the Global Alliance Against Child Sexual Abuse Online. Fifty countries now participate in the Global Alliance Against Child Sexual Abuse Online which Attorney General Holder co-founded with European Union Commissioner Cecilia Malmstrom in 2012.

The Quintet will also focus on other forms of violent crime, including gun violence, as well as on victims’ rights and on the use of technology in prosecutions. In addition, experts will report on the Quintet’s ongoing collaboration against cybercrime and on the use of asset forfeiture to halt the financing of criminal and terrorist groups.

The goal of the Quintet meetings is to seek practical steps that can be taken to improve the abilities of the five countries to investigate and prosecute criminal and terrorist activity.  Themes of prior Quintet meetings have included: the use of national security information in terrorism prosecutions; improving mutual legal assistance to fight cybercrime; strategies for countering violent extremism; and cross-jurisdiction actions against organized crime groups.   

The U.S. Strategy to Combat Transnational Organized Crime specifically references the importance of supporting multilateral senior law enforcement exchanges to promote the sharing of criminal intelligence and enhance cooperation, such as the Quintet of Attorneys-General and the Strategic Alliance Group, established with the United Kingdom, Canada, New Zealand and Australia.  Prior meetings of the Quintet have taken place in the United Kingdom, the United States, Australia and Canada.  

On his return trip from New Zealand, Attorney General Holder will meet with U.S. Navy Admiral Samuel J. Locklear III, Commander of the U.S. Pacific Command (PACOM), and other officials to review ongoing law enforcement collaboration between the Department of Justice and PACOM, and to plan future cooperation in the region. The Attorney General and Admiral Locklear will continue their discussions on how they are working collaboratively to counter terrorism, transnational crime and narcotics trafficking in the Pacific region.  

Adventist Health System/West, dba Adventist Health, and its affiliated hospital White Memorial Medical Center have agreed to pay the United States and the state of California $14.1 million to settle claims that they violated the False Claims Act, the Justice Department announced today.   Adventist Health is headquartered in Roseville, Calif., in the Eastern District of California, and operates 19 hospitals and over 150 clinics in California, Hawaii, Oregon and Washington.  White Memorial Medical Center is a teaching hospital located in Los Angeles.

The settlement announced today resolves allegations that Adventist Health improperly compensated physicians who referred patients to the White Memorial facility by transferring assets, including medical and non-medical supplies and inventory, at less than fair market value.  Additionally, Defendant White Memorial paid referring physicians compensation that the United States contended was above fair market value to provide teaching services at its family practice residency program.  The United States alleged that these payments violated the Anti-Kickback Act and Stark Statute, and by extension, the False Claims Act.   Approximately $11.5 million of the settlement will be paid to the U.S. Government, most of which will benefit the Medicare Trust Fund.   The remaining $2.6 million will be paid to California’s Department of Health Care Services.       

The Anti-Kickback Act prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by Medicare, Medicaid and/or 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 Act 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.   

“Kickbacks and other unlawful financial arrangements cost taxpayer dollars and undermine the integrity of medical judgments,” said Stuart F. Delery, the Acting Assistant Attorney General for the Civil Division. “The Department of Justice is committed to making sure that physician referrals do not involve payments made in violation of federal law.”

“The setttement announced today underscores one of the key purposes of the Stark and Anti-Kickback laws – to ensure that the judgment exercised by health care providers is based on legitimate patient needs and is not influenced by illegal payments,” said Benjamin B. Wagner, U.S. Attorney for the Eastern District of California.

“Payouts made by hospitals and clinics – as the government alleged in this case – raise substantial concerns about physician independence and objectivity,” said Ivan Negroni, Special Agent in Charge of the Office of Inspector General, U.S. Department of Health and Human Services San Francisco region.  “Taxpayers and vulnerable patients rightfully expect such payments to be investigated and pursued.”  

The settlement announced today resolves a lawsuit filed in the Eastern District of California under the qui tam, or whistleblower, provisions of the False Claims Act.   These provisions allow private citizens to bring civil actions on behalf of the United States and share in any recovery.   The whistleblowers in this case will collectively receive $2,839,219 of the recovery.  The lawsuit is captioned U.S. ex rel. Hector Luque et al. v. Adventist Health et al. No. 2:08CV1271 (E.D. Cal.). 

As part of the settlement, White Memorial has entered into a comprehensive five-year Corporate Integrity Agreement with the Office of Inspector General of the U.S. Department of Health and Human Services to ensure its continued compliance with federal health care benefit program requirements.

This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. 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 that effort is the False Claims Act, which the Justice Department has used to recover more than $10.3 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14.2 billion.

This case was handled by the United States Attorney’s Office for the Eastern District of California, the Justice Department’s Civil Division, and the Office of Inspector General of the Department of Health and Human Services. The claims settled by this agreement are allegations only, and there has been no determination of liability.

Jean-Claude Bridges pleaded guilty earlier this year to deliberately setting a church on fire and was sentenced this morning in the U.S. District Court for the Western District of Virginia in Danville, Va. Bridges was sentenced to serve two years in prison, two years of supervised release and ordered to pay $141,773.68 in restitution .

Bridges, 18, of Henry County, Va., pleaded guilty to one count of destroying a religious property by fire. Prior to his guilty plea, the court granted a government motion to transfer Bridges to adult status for criminal prosecution. The defendant was 17-years-old when the criminal conduct occurred.

“The freedom to practice the religion that we choose in a safe environment without being subjected to hateful acts is among our nation’s most cherished rights,” said Roy L. Austin, Jr., Deputy Assistant Attorney General of the Justice Department’s Civil Rights Division. “Anyone who violates this right will be prosecuted to the fullest extent of the law.”

“Mr. Bridges’ racial bias led him to commit the dangerous crime of arson,” United States Attorney Timothy J. Heaphy said today. “When he set fire to the New Holy Deliverance Outreach Ministry, he endangered neighbors and first responders. This act of prejudice offended the entire community. This office will protect the civil rights of everyone and vigorously prosecute crimes like that committed by Mr. Bridges. Racism has no place in Axton or anywhere else in the Western District of Virginia.” 

According to filings in the case, on May 20, 2012, at approximately 1:20 a.m., Bridges and another juvenile intentionally set fire to New Holy Deliverance Outreach Ministry, a church with a predominantly African American congregation, located in Axton, Va. In pleading guilty to this offense, Bridges admitted that he burned down New Holy Deliverance Outreach Ministry because of the race, color and ethnic characteristics of its congregants.

The investigation of the case was conducted by the Henry County Department of Public Safety, the Henry County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Thomas Cullen, assisted by Trial Attorney Christopher Lomax of the Department of Justice’s Civil Rights Division, will prosecute the case for the United States.

The United States has filed suit against Chemed Corporation and various wholly owned hospice subsidiaries, including Vitas Hospice Services LLC and Vitas Healthcare Corporation, alleging false Medicare billings for hospice services, the Justice Department announced today. Vitas is the largest for-profit hospice chain in the United States and provides hospice services to patients in 18 states (Alabama, California, Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Kansas, Michigan, Missouri, New Jersey, Ohio, Pennsylvania, Texas, Virginia and Wisconsin) and the District of Columbia. Chemed, which is based in Cincinnati, Ohio and also owns Roto-Rooter Group Inc., a national drain cleaning and plumbing service company, acquired Vitas in 2004.

 

The Medicare hospice benefit is available for patients who elect palliative treatment (medical care focused on providing patients with relief from pain and stress) for a terminal illness, and have a life expectancy of six months or less if their disease runs its normal course. When a Medicare patient receives hospice services, that individual no longer receives services designed to cure his or her illness. Medicare reimburses for different levels of hospice care, including continuous home care, also called crisis care, which is available for patients who are experiencing acute medical symptoms resulting in a brief period of crisis. Crisis care is available when a patient’s acute medical symptoms require the immediate and short-term provision of skilled nursing services in order to keep the patient at home. The reimbursement rate for crisis care services is the highest daily rate a hospice can bill Medicare, and hospices are paid hundreds of dollars more on a daily basis for each patient they certify as having received crisis care services rather than routine hospice services.

 

The government’s complaint alleges that Chemed and Vitas Hospice knowingly submitted or caused the submission of false claims to Medicare for crisis care services that were not necessary, not actually provided, or not performed in accordance with Medicare requirements. According to the complaint, the companies set goals for the number of crisis care days that were to be billed to Medicare. The companies also allegedly used aggressive marketing tactics and pressured staff to increase the numbers of crisis care claims submitted to Medicare, without regard to whether the services were appropriate or were actually being provided. For example, the complaint contends that Vitas billed three straight days of crisis care for a patient, even though the patient’s medical records do not indicate that the patient required crisis care and, indeed, reflect that the patient was playing bingo part of the time.

 

In addition, the government’s complaint alleges that Chemed and Vitas knowingly submitted or caused the submission of false claims for hospice care for patients who were not terminally ill. The companies allegedly paid bonuses to staff based on the number of patients enrolled in the program and based on patients who were admitted for longer lengths of stay, and took adverse employment actions against marketing representatives who did not meet monthly hospice admissions goals. According to the Complaint, these business practices resulted in the admission of patients who were not eligible for hospice care. As an example, the Complaint alleges that Vitas admitted a patient to hospice who showed no signs of a terminal condition and was described in Vitas’ own records as, “very healthy given her age.”

 

As a result of the conduct alleged in the complaint, the government contends that Chemed and Vitas violated the False Claims Act and misspent tens of millions of taxpayer dollars from the Medicare program.

 

“The Medicare hospice benefit is intended to provide patients nearing the end of life with pain management and other palliative care to make them as comfortable as possible,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division. “Too often, however, we hear reports of companies that abuse this critical service by using aggressive marketing tactics to push patients into services they don’t need in order to get higher reimbursements from the government. The Department of Justice will take swift action to protect taxpayer dollars and make sure that Medicare benefits are available to those who truly need them.”

 

The United States’ suit is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. 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 that effort is the False Claims Act, which the Justice Department has used to recover more than $10.3 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14.2 billion.

 

This matter was investigated by the Commercial Litigation Branch of the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Western District of Missouri, the U.S. Attorney’s Office for the Northern District of Texas the U.S. Attorney’s Office for the Central District of California, and the Department of Health and Human Services’ Office of Inspector General. The claims asserted against Chemed and Vitas are allegations only, and there has been no determination of liability.

 

The lawsuit is captioned United States v. Vitas Hospice Services LLC, et al. (W.D. Mo.).

Three men were arrested and charged today in connection with the Boston Marathon bombings investigation.   

Dias Kadyrbayev, 19, and Azamat Tazhayakov, 19, both of New Bedford, Mass., were charged in a criminal complaint with conspiracy to obstruct justice by conspiring to destroy, conceal and cover-up tangible objects belonging to suspected Marathon bomber, Dzhokhar Tsarnaev, namely a laptop computer and backpack containing fireworks.  A third man, Robel Phillipos, 19, of Cambridge, Mass., was charged with willfully making materially false statements to federal law enforcement officials during a terrorism investigation.  According to the affidavit accompanying the complaint, Kadyrbayev and Tazhayakov are both nationals of Kazakhstan who entered the United States on student visas.  Kadyrbayev and Tazhayakov face a maximum sentence of five years in prison and $250,000 fine.  Phillipos, a U.S. citizen, faces a maximum sentence of eight years in prison and a $250,000 fine.

U.S. Attorney for the District of Massachusetts Carmen M. Ortiz and Richard DesLauriers, Special Agent in Charge of the Boston Field Office of the FBI, announced the charges today.  This investigation was conducted by the FBI's Boston Division, the Boston Police Department, the Massachusetts State Police and member agencies of the Boston Joint Terrorism Task Force, which is comprised of more than 30 federal, state and local enforcement agencies, including the Bureau of Alcohol, Tobacco, Firearms and Explosives; U.S. Immigration and Customs Enforcement - Homeland Security Investigations; U.S. Marshals Service; U.S. Secret Service; the Massachusetts Bay Transit Authority; and others.  In addition, the Watertown, Mass., Police Department, the Cambridge Police Department, the Massachusetts Institute of Technology (MIT) Police Department, the Boston Fire Department, the National Guard and police, fire and emergency responders from across Massachusetts and New England played critical roles in the investigation and response.
 
The charges contained in the criminal complaints are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

Related Materials:

Kadyrbayev and Tazhayakov Complaint
Phillipos Complaint

St. Vincent Healthcare, a hospital located in Billings, Mont., and Holy Rosary Healthcare, a hospital located in Miles City, Mont., have agreed to pay $3.95 million plus interest to resolve allegations that they violated the Stark Law and the False Claims Act by improperly providing incentive pay to physicians that made referrals to the hospitals, the Justice Department announced today.

 

The Stark Law forbids a hospital from billing Medicare for certain services referred by physicians who have a financial relationship with the hospital unless that relationship falls within certain exceptions. A prohibited financial relationship includes a hospital’s agreement to compensate a physician in a manner that takes into account the volume of the physician’s referrals or the revenue realized through those referrals.

 

The settlement announced today resolves allegations that the hospitals paid several physicians incentive compensation that took into account the value or volume of their referrals by improperly including certain designated health services in the formula for calculating physician incentive compensation. These issues were disclosed by the hospitals to the government.

 

“The resolution of this matter underscores our commitment to ensure that services reimbursable by federal health care programs are based on the best interests of patients rather than the personal financial interests of referring physicians,” said Stuart F. Delery, Acting Assistant Attorney General for the Department’s Civil Division.

 

“Combating health care fraud is a top priority of the Department of Justice and the Montana U.S. Attorney’s Office. St. Vincent Healthcare and Holy Rosary Healthcare allegedly put their financial interest ahead of their responsibility to provide cost effective health care. The United States recovered $3,950,000 of taxpayers’ dollars from the hospitals. The U.S. Attorney’s Office is committed to enforcing the Stark Law and False Claims Act, as well as other health care laws and regulations against wrongdoers. This case also demonstrates how the Department of Justice will work with those health care providers who disclose their misconduct,” said Michael W. Cotter, U.S. Attorney for the District of Montana.

 

“There is an expectation that corporations providing services to Medicare and Medicaid beneficiaries adhere to the provision of the Stark Law. I applaud St. Vincent Healthcare and Holy Rosary Healthcare for recognizing their potential liability in this matter and making a disclosure,” said Gerry Roy, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services region including Montana. “Working closely with our partners at the Department of Justice, we will vigilantly protect federal health care programs against violations of the Stark Law.”

 

This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services, in May 2009. The partnership between the two departments has focused on efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover $10.3 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14.2 billion.

 

This case was handled by the U.S. Attorney’s Office for the District of Montana, the Department of Justice’s Civil Division, the Office of Inspector General of the U.S. Department of Health and Human Services, and the FBI. The claims settled by this agreement are allegations only, and there has been no determination of liability.

A former Texas state parole officer was sentenced to 20 months in prison today for taking bribes from one of her assigned parolees in exchange for not reporting his parole violations, announced Acting Assistant Attorney General Mythili Raman of the Department of Justice’s Criminal Division.

Nichelle Derricks, 38, of Cedar Hill, Texas, pleaded guilty on Jan. 22, 2013, to one count of honest services wire fraud in the Northern District of Texas.

According to court documents, while serving as a Texas Department of Criminal Justice (TDCJ) parole officer, Derricks and one of her assigned parolees developed an improper relationship in which Derricks secretly used her official position with TDCJ to enrich herself and others by soliciting and receiving cash payments, gifts, furniture, household goods and items, food and beverages and other things of value from the parolee in exchange for favorable official action benefitting the parolee. The scheme was conducted without the authorization, knowledge or approval of TDCJ and contrary to TDCJ procedures and requirements.

Derricks admitted she repeatedly failed to report the parolee for violating the terms of his parole, including, among other things, failing to report him for traveling outside Texas without prior, written approval and for engaging in prohibited financial transactions.

The case was investigated by the FBI’s Dallas Field Office, with assistance from the U.S. Secret Service and the TDCJ Office of Inspector General. The case is being prosecuted by Trial Attorneys Edward P. Sullivan of the Justice Department Criminal Division’s Public Integrity Section.  

A former executive of the U.S. subsidiary of a French power and transportation company was charged in a superseding indictment for his alleged participation in a scheme to pay bribes to foreign government officials, Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney for the District of Connecticut David B. Fein and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office announced today.

William Pomponi, 65, a former vice president of sales for the Connecticut-based U.S. subsidiary, was charged in a superseding indictment late yesterday in the District of Connecticut with conspiring to violate the Foreign Corrupt Practices Act (FCPA) and to launder money, as well as substantive charges of FCPA and money laundering violations.

On April 16, 2013, charges against Frederic Pierucci and a guilty plea by David Rothschild in connection with the bribery scheme were announced.  Pierucci is charged in the superseding indictment with Pomponi.  On Nov. 2, 2012, Rothschild pleaded guilty to a criminal information.

According to the charges, the defendants, together with others, paid bribes to officials in Indonesia, including a member of Indonesian Parliament and high-ranking members of Perusahaan Listrik Negara (PLN), the state-owned and state-controlled electricity company in Indonesia, in exchange for assistance in securing a $118 million contract, known as the Tarahan project, for the company and its consortium partner to provide power-related services for the citizens of Indonesia.  The charges allege that, in order to conceal the bribes, the defendants retained two consultants purportedly to provide legitimate consulting services on behalf of the power company and its subsidiaries in connection with the Tarahan project.  In reality, however, the primary purpose for hiring the consultants was allegedly to use the consultants to pay bribes to Indonesian officials.

The first consultant retained by the defendants allegedly received hundreds of thousands of dollars into his Maryland bank account to be used to bribe the member of Parliament, according to the charges.  The consultant then allegedly transferred the bribe money to a bank account in Indonesia for the benefit of the official.  According to court documents, emails between Pomponi, Pierucci, Rothschild and their co-conspirators discuss in detail the use of the first consultant to funnel bribes to the member of Parliament and the influence that the member of Parliament could exert over the Tarahan project.  However, when Pomponi, Pierucci and others determined that the first consultant was not effectively bribing key officials at PLN, they allegedly retained a second consultant to accomplish that purpose.  The charges allege that the power company deviated from its usual practice of paying consultants on a pro-rata basis in order to make a much larger up-front payment to the second consultant so that the consultant could “get the right influence.”  An employee at the power company’s subsidiary in Indonesia sent an email to Pomponi, Pierucci and others asking them to finalize the consultancy agreement with the front-loaded payments but stated that in the meantime the employee would give his word to a high-level official at PLN, according to the charges. 
  
The conspiracy to commit violations of the FCPA count carries a maximum penalty of five years in prison and a fine of the greater of $250,000 or twice the value gained or lost.  The substantive FCPA counts each carry a maximum penalty of five years in prison and a fine of the greater of $100,000 or twice the value gained or lost.  The conspiracy to commit money laundering count carries a maximum penalty of 20 years in prison and a fine of the greater of $500,000 or twice the value of the property involved in the transaction.  The substantive money laundering counts each carry a maximum penalty of 20 years in prison and a fine of the greater of $500,000 or twice the value of the property involved in the transaction.

  An indictment is merely an accusation, and defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.

The case is being prosecuted by Trial Attorney Daniel S. Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney David E. Novick of the District of Connecticut.  The case is being investigated by FBI agents who are part of the Washington Field Office’s dedicated FCPA squad, with assistance from the Meriden, Conn., Resident Agency of the FBI.  Significant assistance was provided by the Criminal Division’s Office of International Affairs, and the department has also worked closely with its law enforcement counterparts in Indonesia at the Komisi Pemberantasan Korupsi (Corruption Eradication Commission) and deeply appreciates KPK’s assistance in this matter.

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

Related Materials:

Superseding Indictment

A New York woman was sentenced to 19 months in prison today for her role in a scheme to defraud consumer product manufacturers, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and the U.S. Attorney’s Office for the Southern District of Indiana.

Dina Wein Reis, 49, was sentenced by U.S. District Judge Jane E. Magnus-Stinson in the Southern District of Indiana and ordered to pay restitution of $5,678,190 and a fine of $1 million.

Reis pleaded guilty on May 19, 2011, to a criminal information charging her with one count of conspiracy to commit wire fraud. 

According to plea documents, between June 2003 and July 2006 Reis owned and operated a marketing business based in New York and used fraudulent means to obtain consumer goods at discounted prices from manufacturers and distributors of consumer products. Participants in the scheme “cold-called” executives at large consumer product companies to solicit their products, falsely promising that if each manufacturer sold its products to Reis, the products would be distributed to a variety of outlets that were typically difficult for these manufacturers to reach on their own. The scheme included a marketing venture called the “Goody Pak Program,” which distributed products free of charge to schools for school fundraisers and helped generate marketing information for these manufacturers.

Reis admitted that she negotiated a discount from the manufacturers based on the possibility of future profitable business for the manufacturers arising from her marketing efforts when, in fact, she made few efforts and sold the majority of the products to wholesalers for a profit.  As a result, a manufacturer in Indiana lost $180,000, and a Missouri manufacturer lost $500,000. Reis also agreed through her plea agreement to make restitution to manufacturing companies not specifically named in the information.  

The cases were investigated by the FBI and the U.S. Marshals Service. The cases were prosecuted by Trial Attorney Matthew Klecka of the Criminal Division’s Asset Forfeiture and Money Laundering Section, formerly a Trial Attorney in the Division’s Fraud Section, and Assistant U.S. Attorney Winfield Ong of the Southern District of Indiana. 

Odalis Castillo-Lopez, 41, a citizen of the Dominican Republic and a resident of New York, pleaded guilty today to theft of government property and money laundering in connection with a scheme to cash U.S. Treasury tax refund checks fraudulently obtained using the stolen identities of Puerto Rican residents. The guilty plea was announced by the Justice Department, the Internal Revenue Service – Criminal Investigation (IRS-CI), Homeland Security Investigations and the U.S. Secret Service.

At a hearing before U.S. District Court Chief Judge Patti B. Saris in the District of Massachusetts, Castillo pleaded guilty to theft of government property and money laundering. According to the documents filed in this case, the criminal conduct involved the attempted negotiation of U.S. Treasury income tax refund checks obtained in the name of stolen identities. Castillo faces a maximum potential sentence of 10 years in prison and a fine of up to $250,000 for the theft of government property charge, and a maximum of 20 years in prison and a fine of up to $500,000 for the money laundering charge. Sentencing is scheduled for May 30, 2013.

This investigation was conducted jointly by IRS-CI, Homeland Security Investigations and the U.S. Secret Service in Boston. The prosecution is being handled by Senior Litigation Counsel Corey J. Smith of the Justice Department’s Tax Division.

Related Materials:

United States v. Odalis Castillo-Lopez
Indictment (PDF)
 

A federal court in Los Angeles has entered an order permanently barring John Trunzo from preparing federal income tax returns and other tax-related documents for others, the Justice Department announced today. Trunzo, who operated under the business names “Your Taxman John Trunzo,” “Your Taxman” and “YTJT” in Los Angeles County, consented to the civil injunction order, which was signed by U.S. District Judge Michael W. Fitzgerald.

The government complaint, filed on February 14, 2013, alleged that Trunzo under reported gross receipts on his own income tax returns filed for the tax years 2005 – 2007, causing the government to incur a tax loss of $67,231 for those years. The complaint further alleged that Trunzo provided the Internal Revenue Service (IRS) with false documents in order to convince auditors that his clients had incurred expenses that Trunzo knew they had not incurred, and were entitled to deductions that Trunzo knew were fabricated, which obstructed and impeded the IRS from determining his clients’ true tax liability.

In addition to barring Trunzo from preparing tax returns, Judge Fitzgerald also required Trunzo to create a website to inform his customers of the entry of the permanent injunction within thirty days.

As noted in the complaint, Trunzo was previously charged with one count of subscribing to a false income tax return. He entered a guilty plea to this charge. According to the plea agreement, filed in the criminal case on July 9, 2012, Trunzo agreed to enter into a binding civil injunction, barring him for life from aiding or assisting in the preparation of federal income tax returns for anyone other than himself and his legal spouse, and barring him from representing persons before the IRS.

In the past decade the Justice Department’s Tax Division has obtained injunctions against hundreds of tax-return preparers and tax-fraud promoters. Information about these cases is available on the Justice Department website . For more information about choosing a tax return preparer, see the IRS website and the IRS YouTube Channel .

Related Materials:

United States v. John Trunzo
Stipulated Order of Permanent Injunction (PDF)
Complaint for Permanent Injunction and Other Relief (PDF)
 

New guidance released today by the U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of Justice reinforces the Fair Housing Act requirement that multifamily housing be designed and constructed so as to be accessible to persons with disabilities.

 

The Fair Housing Act prohibits discrimination in housing based on disability, race, color, national origin, religion, sex and familial status. The Fair Housing Act also requires that multifamily housing with four or more units, built for first occupancy after March 1991, contain accessible features for persons with disabilities.

 

The new guidance is designed to help design professionals, developers and builders better understand their obligations and help persons with disabilities better understand their rights regarding the “design and construction” requirements of the federal Fair Housing Act.

 

“Everyone who is involved in designing and building multifamily housing must ensure that the required accessible features are present so that people with disabilities can use and enjoy their homes,” said Eric Halperin, Senior Counsel and Special Counsel for Fair Lending in the Civil Rights Division.  “This guidance will help design professionals and builders understand their obligations under this important component of the Fair Housing Act.”

 

“With one of five persons in this nation having a physical disability, housing units that include the required features of accessibility are more important than ever.” stated John Trasviña, HUD Assistant Secretary for Fair Housing and Equal Opportunity (FHEO). “This new guidance will assist developers in constructing housing that complies with the Fair Housing Act’s design and construction requirements from the start and avoid having to deal with costly retrofitting later.”

 

HUD and the Justice Department share responsibility for enforcing the federal Fair Housing Act.  HUD is the agency with the primary responsibility to investigate individual complaints of discrimination.  The Secretary of HUD, on his own initiative, may also file complaints alleging discrimination.  The Attorney General may commence a civil action in federal court when there is reasonable cause to believe that someone is engaged in a pattern or practice of discrimination or that a group of persons has been denied rights protected by the act.

 

Under the act, new multifamily housing must include:

 

·          Public and common use areas that are readily accessible to and usable by persons with disabilities; and

 

·          Doors that are designed to allow passage into and within all premises of covered dwellings and that are sufficiently wide to allow passage by persons with disabilities, including persons who use wheelchairs.

 

In addition, all premises within covered dwellings must contain:

 

·          An accessible route into and through the dwelling unit;

 

·          Light switches, electrical outlets, thermostats, and other environmental controls in accessible locations;

 

·          Reinforcements in bathroom walls to allow the later installation of grab bars;

 

·          Usable kitchens and bathrooms such that an individual using a wheelchair can maneuver about and use the space.

 

The new guidance, issued in the form of questions and answers, supplements previously-issued guidance and answers such questions as:

 

·          What are the design and construction requirements?

 

·          Who must comply with the design and construction requirements?

 

·          What types of dwellings are covered by the design and construction requirements?

 

·          What are accessible routes? 

 

·          What is an accessible entrance?

 

·          What is an accessible public and common use area?

 

·          What safe harbors are available for compliance with the design and construction requirements?

 

The new guidance is available here. Information about the guidance is also available at www.fairhousingfirst.org .

 

Since January 2009, HUD and its Fair Housing Assistance Program partners have investigated and either conciliated or charged nearly 5,000 cases that alleged discrimination based on disability, and the Justice Department’s Civil Rights Division has filed 141 cases to enforce the Fair Housing Act, 19 of which have alleged discrimination based on a failure to design and construct multifamily housing in compliance with the act. 

 

For more information about HUD and the civil rights laws it enforces, go to www.hud.gov/fairhousing and click on “Learn more about FHEO.” More information about the Justice Department’s Civil Rights Division and the laws it enforces is available at www.justice.gov/crt/index.php .

Individuals who believe that they may have been victims of housing discrimination should contact HUD at 1-800-669-9777 or go to HUD’s web site: www.hud.gov/fairhousing , or by downloading HUD’s free housing discrimination mobile application, which can be accessed through Apple devices, such as the iPhone, iPad and iPod touch .

In addition, individuals may contact the Justice Department at 1-800-896-7743 or by email at fairhousing@usdoj.gov .

The Justice Department announced that late yesterday a federal court in San Francisco entered an order authorizing the Internal Revenue Service (IRS) to serve a John Doe summons seeking information about U.S. taxpayers who may hold offshore accounts at Canadian Imperial Bank of Commerce FirstCaribbean International Bank (FCIB). The order was signed by Senior District Judge Thelton E. Henderson. The IRS summons seeks records of FCIB’s United States correspondent account at Wells Fargo N.A., which will allow the IRS to identify U.S. taxpayers who hold or held interests in financial accounts at FCIB and other financial institutions that used FCIB’s Wells Fargo correspondent account.

Pursuant to a petition filed by the United States, the Court granted the IRS permission to serve what is known as a “John Doe” summons on Wells Fargo. The IRS uses John Doe summonses to obtain information about possible violations of internal revenue laws by individuals whose identities are unknown. This John Doe summons directs Wells Fargo to produce records identifying U.S. taxpayers with accounts at FCIB and other banks that used FCIB’s correspondent account.

According to the declaration of IRS Revenue Agent Cheryl R. Kiger filed in support of the petition, FCIB is based in Barbados and has branches in 18 Caribbean countries. Although FCIB does not have U.S. branches, it maintains a correspondent account in the United States at Wells Fargo Bank N.A. As alleged in Agent Kiger’s declaration, the IRS learned that U.S. taxpayers were using FCIB to help them keep their offshore accounts undetected by the IRS and not to pay U.S. federal income tax on money placed in those offshore accounts. Kiger’s declaration describes her review of the information submitted by more than 120 FCIB customers who participated in the IRS’s Offshore Voluntary Disclosure Program. According to the Kiger declaration, many of the FCIB customers in the John Doe class may have been under-reporting income, evading income taxes, or otherwise violating the internal revenue laws of the United States.

“The Department of Justice and the IRS are committed to global enforcement to stop the use of foreign bank accounts to evade U.S. taxes,” said Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division. “This John Doe summons is a visible indication of how we are using the many tools available to us to pursue this activity wherever it is occurring. Those who are still hiding should get right with their country and their fellow taxpayers before it is too late.”

“This summons marks another milestone in international tax enforcement,” said IRS Acting Commissioner Steven T. Miller. “Our work here shows our resolve to pursue these cases in all parts of the world, regardless of whether the person hiding money overseas chooses a bank with no offices on U.S. soil.”

In a similar case, on Jan. 28, 2013, the U.S. District Court for the Southern District of New York entered an order authorizing the IRS to serve a John Doe summons on UBS AG, seeking records of Swiss bank Wegelin & Co.’s United States correspondent account at UBS, which will allow the United States to determine the identity of U.S. taxpayers who hold or held interests in financial accounts at Wegelin and other Swiss financial institutions to evade federal income taxes. 

Federal tax law requires U.S. taxpayers to pay taxes on all income earned worldwide. U.S. taxpayers must also report foreign financial accounts if the total value of the accounts exceeds $10,000 at any time during the calendar year. A deliberate failure to report a foreign account can result in a penalty of up to 50 percent of the amount in the account at the time of the violation. U.S. taxpayers are reminded that the IRS currently has in place an Offshore Voluntary Disclosure Program where U.S. taxpayers can come forward and disclose their offshore accounts and income. For more details, please go to the IRS’s website: www.irs.gov/uac/2012-Offshore-Voluntary-Disclosure-Program .

A correspondent account is a bank deposit account maintained by one bank for another bank. Financial transactions involving U.S. dollars flow through U.S. banks. Therefore, foreign banks that do business in U.S. dollars, but have no office in the U.S., obtain a correspondent account at a U.S. bank in order to engage in such transactions. These transactions leave a trail in the U.S. that the IRS can access through the records of the correspondent bank accounts. These correspondent bank accounts have records of money deposited, money paid out through checks and money moved through the correspondent account by wire transfers. All of this information the IRS can obtain through a John Doe summons issued to the U.S. bank holding the correspondent account.

Related Materials:

In the Matter of the Tax Liabilities of: John Does, etc.
Ex Parte Petition for Leave to Serve "John Doe" Summons (PDF)
Declaration of Revenue Agent Cheryl R. Kiger in Support of Ex Parte Petition for Leave to Serve "John Doe" Summons (PDF)
Memorandum in Support of Ex Parte Petition for Leave to Serve "John Doe" Summons (PDF)
Notice of Filing Ex Parte Petition for Leave to Serve "John Doe" Summons (PDF)
Order Granting Ex Parte Petition for Leave to Serve "John Doe" Summons (PDF)

A federal grand jury returned an indictment charging Shatoubrioune Hare George, a.k.a. “Tobie,” with conspiring to cash fraudulently obtained federal tax refund checks, the Justice Department and the Internal Revenue Service (IRS) announced today. The six-count indictment charges George, of Montgomery, Ala., with conspiracy to commit theft of public funds and with theft of public funds.

 

According to the indictment, George and others obtained federal tax refund checks issued by the IRS as a result of the filing of fraudulent tax returns. She and others cashed 77 fraudulently obtained U.S. Treasury tax refund checks totaling approximately $137,000 through a bank teller who worked for a bank in Wetumpka, Ala.

 

An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, George faces a potential maximum of five years in prison for the conspiracy count and 10 years in prison for each theft of public funds count. She is also subject to fines, mandatory restitution and forfeiture if convicted.

The case was investigated by special agents of IRS - Criminal Investigation. Trial attorneys Charles Edgar Jr. and Michael Boteler of the Justice Department’s Tax Division and Assistant U.S. Attorney Todd Brown are prosecuting the case.

 

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

Related Materials:

George Indictment

Bridgette Rivers, a resident of Montgomery, Ala., was indicted by a federal grand jury on charges of conspiracy and theft of government funds related to her participation in a scheme to use stolen identities to file fraudulent tax returns, the Justice Department and the Internal Revenue Service (IRS) announced today.

According to the indictment, Rivers provided identity information to co-conspirators, who then used the stolen identities, among other identities, to file false tax returns that fraudulently requested tax refunds from the IRS. Rivers is also alleged to have recruited another individual to provide her bank account information for use in the conspiracy. Fraudulently obtained tax refunds allegedly went into that individual’s bank account and the individual would then withdraw the money to give to Rivers.

An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Rivers faces a maximum potential sentence of 10 years in prison for the conspiracy charge and each theft of public funds charge. She would also be subject to fines, mandatory forfeiture and restitution if convicted.

This case was investigated by special agents of IRS - Criminal Investigation. Trial Attorneys Michael Boteler and Jason Poole of the Justice Department’s Tax Division are prosecuting the case, with assistance from the U.S. Attorney’s Office for the Middle District of Alabama and, in particular, Assistant U.S. Attorney Todd Brown.

Related Materials:

United States v. Bridgette Rivers
Rivers Indictment (PDF)

Eric Anderson, of Dix Hills, N.Y., was arrested today following his indictment on April 25, 2013, on numerous tax crimes, the Justice Department and Internal Revenue Service (IRS) announced.

 

According to the indictment, Anderson owned three construction companies in Dix Hills: Anderson Framing, Anderson Enterprise and Anderson Trim Specialty. As alleged, Anderson corruptly endeavored to obstruct the IRS between 2006 and 2008 by using a check cashing service to cash over $10.5 million of gross receipts checks paid to his construction companies. He concealed his check cashing activities from his tax return preparer so that the income was not included on the companies’ tax returns. Anderson paid his employees in cash while failing to collect and pay over to the IRS employment taxes. He also diverted cash receipts earned by his companies for his own personal use. Finally, after learning of the criminal investigation, Anderson shredded business records and lied to IRS investigators about his use of the check cashing service.

 

The indictment also alleges that Anderson filed a false 2006 corporate income tax return for Anderson Trim and failed to file multiple years of employment tax returns, corporate income tax returns, and individual income tax returns. Anderson faces a potential maximum sentence of 94 years in prison and a potential fine of up to $5,300,000.

 

A trial date has not been scheduled. An indictment merely alleges that a crime has been committed, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.

 

The case was investigated by IRS - Criminal Investigation and is being prosecuted by Trial Attorneys Mark Kotila and Jeffrey Bender of the Justice Department’s Tax Division.

An executive of AU Optronics Corp., a Taiwan-based liquid crystal display (LCD) producer, was sentenced today in U.S. District Court in San Francisco for his participation in a worldwide thin-film transistor-liquid crystal display (TFT-LCD) price-fixing conspiracy. Shiu Lung Leung, AU Optronics Corp.’s former senior manager in its Desktop Display Business Group, was sentenced to serve 24 months in prison and to pay a $50,000 criminal fine, the Department of Justice announced.

AU Optronics Corp., based in Hsinchu, Taiwan, and its American subsidiary, AU Optronics Corp. America, headquartered in Milpitas, Calif., were found guilty in March 2012, for their participation in the price-fixing conspiracy, following an eight-week trial. Former AU Optronics Corp. president Hsuan Bin Chen and former AU Optronics Corp. executive vice president Hui Hsiung were also found guilty at that time. A mistrial was declared against Leung after that trial. Today’s sentencing took place before Judge Susan Illston and follows a three-week retrial that started in November 2012 and resulted in Leung’s conviction.
“These international price-fixers caused consumers to pay inflated prices for their computer monitors, notebook computers and televisions,” said Assistant Attorney General Bill Baer in charge of the Department of Justice’s Antitrust Division.  “Prison sentences for culpable executives, combined with substantial fines against corporate wrongdoers, are the most effective deterrents for protecting consumers from this kind of illegal cartel behavior.”
The indictment charged that AU Optronics Corp. participated in the worldwide price-fixing conspiracy from Sept. 14, 2001, to Dec. 1, 2006, and that its subsidiary joined the conspiracy as early as spring 2003. The indictment further charged that Leung participated in that conspiracy from May 15, 2002 to Dec. 1, 2006. LCD panels affected by the conspiracy were a major component in flat-panel computer monitors, notebook computers, and flat-screen televisions sold in the United States. The conspirators fixed the prices of LCD panels during monthly meetings with their competitors, which were secretly held in hotel conference rooms, karaoke bars and tea rooms around Taiwan.  

Eight companies have been convicted of charges arising out of the department’s ongoing investigation and have been sentenced to pay criminal fines totaling $1.39 billion. All together, 22 executives have been charged.  Including today’s sentence, 13 executives have been convicted and have been sentenced to serve prison terms ranging from six to 36 months.

Today’s charges are the result of a joint investigation by the Department of Justice Antitrust Division’s San Francisco office and the FBI in San Francisco. Anyone with information concerning illegal conduct in the LCD industry is urged to call the Antitrust Division’s San Francisco office at 415-436-6660 or visit www.justice.gov/atr/contact/newcase.html

Attorney General Eric Holder today announced the appointment of six new U.S. Attorneys to serve two-year terms on the Attorney General’s Advisory Committee (AGAC): David Barlow, District of Utah; Richard S. Hartunian, Northern District of New York; Barbara L. McQuade, Eastern District of Michigan; Wendy J. Olson, District of Idaho; Ronald W. Sharpe, District of the Virgin Islands; and Anne Tompkins, Western District of North Carolina.

“It’s a pleasure to welcome the newest members of the Attorney General’s Advisory Committee, a group of U.S. Attorneys with whom I regularly consult on some of the most critical law enforcement and public safety issues  facing our country,” said Attorney General Holder. “I’m grateful for their service and leadership on the AGAC.  I applaud the excellent work that each of them is leading in their home districts.  And I look forward to working closely with them as we work together to confront the present challenges and seize new opportunities to protect and ensure justice for the American people.”

 The Attorney General also thanked the U.S. Attorneys who have completed their two-year terms and are rotating off the committee: Paul J. Fishman, District of New Jersey; Benjamin B. Wagner, District of Eastern California; Steven M. Dettelbach, Northern District of Ohio; John F. Walsh, District of Colorado; and Stephanie A. Finley, Western District of Louisiana.

 The AGAC, chaired by U.S. Attorney for the Eastern District of New York Loretta E. Lynch, was created in 1973. The committee, which reports to the Attorney General through the Deputy Attorney General, represents the voice of the U.S. Attorneys and provides advice and counsel to the Attorney General on policy, management and operational issues impacting the Offices of the U.S. Attorneys.

 A brief bio on each appointee is below: David Barlow was presidentially appointed U.S. Attorney for the District of Utah on Oct. 15, 2011.  He previously served as the General Counsel and Chief Counsel for Judiciary for Senator Michael S. Lee in 2011. From 2000 to 2010, Mr. Barlow worked at Sidley Austin LLP; first as an associate from 2000 to 2006, and then as a Partner from 2006 to 2010. Prior to this, Mr. Barlow was an Associate at Locke Lord Bissell & Liddell LLP from 1998 to 2000.  Barlow serves as chair of the AGAC’s Local Government Coordination Working Group, and as a member of the Border and Immigration Law Enforcement Subcommittee, Native American Issues Subcommittee and White Collar/Fraud Subcommittee.
Richard Hartunian was presidentially appointed U.S. Attorney for the Northern District of New York on Feb. 19, 2010.  Prior to his appointment, he served as an Assistant U.S. Attorney for the Northern District of New York (1997-2010).  From 1990 to 1997, Hartunian worked both as an Assistant District Attorney for the Office of the District Attorney in Albany County, New York, and as a partner at Hartunian and Clark. Prior to that, he was an associate attorney at Devine, Piedmont and Rutnik.  Hartunian serves as vice chair of the AGAC’s the Border and Immigration Law Enforcement Subcommittee, and as a member of the Native American Issues Subcommittee, Environmental Issues Working Group and Health Care Fraud Working Group.

Barbara McQuade was presidentially appointed U.S. Attorney for the Eastern District of Michigan on Jan. 4, 2010.  She previously served as an Assistant U.S. Attorney for the Eastern District of Michigan from 1998 to 2010, becoming Deputy Chief of the National Security Unit in 2005. Previously McQuade was an associate attorney at Butzel Long P.C., from 1993 to 1998.  She began her legal career as a law clerk for the Honorable Bernard A. Friedman of the U.S. District Court for the Eastern District of Michigan from 1991 to 1993. McQuade serves as Vice Chair of the AGAC’s Terrorism/National Security Subcommittee, and as a member of the Border and Immigration Law Enforcement Subcommittee, Civil Rights Subcommittee, Local Government Coordination Working Group, and Medical Marijuana Working Group.

 Wendy Olson was presidentially appointed U.S. Attorney for the District of Idaho on June 25, 2010.  Prior to her appointment she served as an Assistant U.S. Attorney for the District of Idaho from 1997-2010, including as Senior Litigation Counsel (2006-2010).  Olson worked for the Criminal Section of the Civil Rights Division of the Department of Justice, where she was a trial attorney from 1992 until 1996, and Deputy Director of Operations and Assistant to the Director on the National Church Arson Task Force from 1996 until 1997.  Olson was also an Adjunct Professor of Legal Writing at the George Washington University School of Law from 1994 until 1997.  Olson serves as a member of the AGAC’s Border and Immigration Law Enforcement Subcommittee, Civil Rights Subcommittee, Native American Issues Subcommittee, and Local Government Coordination Working Group. 

Ronald Sharpe was presidentially appointed U.S. Attorney for the District of the Virgin Islands on July 7, 2011.  He was the court appointed U.S. Attorney from July 2011.  From 2008 to 2009, he served as the First Assistant U.S. Attorney for the District of the Virgin Islands, and as an Assistant U.S. Attorney in the U.S. Attorney’s Office for the District of Columbia from 1995 to 2008. Prior to this, Sharpe was an associate at Jones, Day, Reavis & Pogue, from 1991 to 1995. Sharpe serves as a member of the AGAC’s Border and Immigration Law Enforcement Subcommittee, LECC/Victim/Community Issues Subcommittee and Environmental Issues Working Group.

Anne Tompkins was presidentially appointed U.S. Attorney for the Western District of North Carolina on Apr. 26, 2010.  Prior to her appointment Tompkins was a partner at Alston & Bird, LLP, from 2005 to 2010.  From 2000 to 2005, she was an Assistant U.S. Attorney for the Western District of North Carolina, serving as deputy criminal chief from 2002 to 2004 and on detail in the Regime Crimes Liason Office in Baghdad, Iraq, from 2004 to 2005.  Tompkins serves as Vice Chair of the AGAC’s Civil Rights Subcommittee, and as a member of the Native American Issues Subcommittee, Office Management and Budget Subcommittee, White Collar/Fraud Subcommittee and Health Care Fraud Working Group. 

 The full AGAC membership is listed below:     Loretta E. Lynch, U.S Attorney, Eastern District of New York, Chair
 Sally Quillian Yates, U.S Attorney, Northern District of Georgia, Vice Chair
 David Barlow, U.S. Attorney, District of Utah
 Laura E. Duffy, U.S. Attorney, Southern District of California
 Richard S. Hartunian, U.S. Attorney, Northern District of New York
 Timothy J. Heaphy, U.S. Attorney, Western District of Virginia
 Brendan V. Johnson, U.S. Attorney, District of South Dakota
 Pamela Cothran Marsh, U.S. Attorney, Northern District of Florida
 Barbara L. McQuade, U.S. Attorney, Eastern District of Michigan
 Wendy J. Olson, U.S. Attorney, District of Idaho
 Carmen Milagros Ortiz, U.S. Attorney, District of Massachusetts
 Robert L. Pitman, U.S. Attorney, Western District of Texas
 James L. Santelle, U.S. Attorney, Eastern District of Wisconsin
 Ronald W. Sharpe, U.S. Attorney, District of the Virgin Islands
 Carter M. Stewart, U.S. Attorney, Southern District of Ohio
 Anne Tompkins, U.S. Attorney, Western District of North Carolina
 Ronald C. Machen, U.S. Attorney, District of Columbia, ex officio
 Daniel Bella, Criminal Chief, Northern District of Indiana, ex officio
 Suzanne Bauknight, Civil Chief, Eastern District of Tennessee, ex officio
 Robert Zauzmer, Appellate Chief, Eastern District of Pennsylvania, ex officio

The Justice Department announced today that the United States has filed a second civil false claims lawsuit against Novartis Pharmaceuticals Corp. involving alleged kickbacks paid by the company to health care providers. The government’s complaint seeks damages and civil penalties under the False Claims Act and under the common law for paying kickbacks to doctors to induce them to prescribe Novartis pharmaceutical products that were reimbursed by federal health care programs. The lawsuit alleges that the payments violated the Anti-Kickback Statute and, as a result of Novartis’s unlawful conduct, the government paid false claims for reimbursement for Novartis pharmaceutical products.

 

“Kickback schemes like those alleged in this case not only call into question the integrity of individual medical decisions, but they also raise the cost of health care for all of us,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division.  “Patients deserve care based on a doctor’s sound medical judgment, not the doctor’s personal financial interest.  The Department of Justice will continue to pursue companies that use improper incentives, like those alleged here, to promote their products.”

 

“As alleged, Novartis corrupted the prescription drug dispensing process with multi-million dollar ‘incentive programs’ that targeted doctors who, in exchange for illegal kickbacks, steered patients toward its drugs. And for its investment, Novartis reaped dramatically increased profits on these drugs, and Medicare, Medicaid, and other federal healthcare programs were left holding the bag, doling out millions of dollars in kickback-tainted claims,” said U.S. Attorney for the Southern District of New York Preet Bharara. “Healthcare fraud imposes tremendous costs and causes great harm to an already burdened healthcare system, and the government will not tolerate it. The widespread kickback fraud alleged in our two lawsuits against Novartis – which only a few years ago settled a False Claims Act case involving violations of the Anti-Kickback Statute based on illegal payments to doctors – makes us question whether Novartis is getting the message.”

 

The following allegations are based on the government’s complaint filed in the Southern District of New York:

 

Novartis, a pharmaceutical company headquartered in East Hanover, N.J., is a subsidiary of Novartis AG, an international pharmaceutical company headquartered in Basel, Switzerland. From January 2001 through at least November 2011, Novartis systematically violated the Anti-Kickback Statute , which prohibits the payment of remuneration to induce referrals of items or services covered by Medicare, Medicaid, and other federally-funded programs. Indeed, Novartis violated its own internal policies concerning speaker programs, which require that the programs have an educational purpose and that slides about the company’s drugs be presented. Novartis violated the Anti-Kickback Statute by paying doctors to speak about certain drugs, including its hypertension drugs Lotrel and Valturna and its diabetes drug Starlix, at events that were often little or nothing more than social occasions for the doctors. The payments and lavish dinners given to the doctors were, in reality, kickbacks to the speakers and attendees to induce them to write prescriptions for Novartis drugs. In many instances Novartis made payments to doctors for purported speaker programs that either did not occur at all or that had few or no attendees, and thousands of programs were held all over the country at which few or no slides were shown and the doctors who participated spent little or no time discussing the drug at issue.

 

Many speaker programs were also held in circumstances in which it would have been virtually impossible for any presentation to be made, such as on fishing trips off the Florida coast. Other Novartis events were held at Hooters restaurants.

 

In connection with these programs, Novartis also frequently treated the doctors to expensive dinners that they hosted at high-end restaurants. For example, a July 5 dinner for three, including the speaker, at a Washington, D.C. restaurant cost $2,016, or $672 per person. Novartis also paid a $1,000 honorarium to the speaker for this program. One of the two attendees had attended the same program a short time earlier. At another program held on Valentine’s Day in 2006, Novartis paid $3,127, for a meal for two at a West Des Moines, Iowa restaurant, or $1,042 per person.

 

Novartis’s internal analyses show that speaker programs had a high return on investment in terms of the additional prescriptions for its drugs written by the doctors who participated in the programs, both as speakers and attendees, with the highest return arising from payments to doctors as “honoraria” for speaking. In short, doctors increased the number of prescriptions they wrote when they were being paid by Novartis to speak about a drug. As a result, Novartis spent millions on speaker programs yearly. According to Novartis’s data, during the period from January 2002 through November 2011, it spent nearly $65 million and conducted more than 38,000 speaker programs for just three drugs: the hypertension drugs, Lotrel and Valturna, and the diabetes drug, Starlix. In the absence of a legitimate purpose for many of the programs, the payments were nothing more than kickbacks to the doctors that induced them to write prescriptions in violation of the Anti-Kickback Statute .

 

Novartis was well aware that its speaker programs created opportunities to provide kickbacks to doctors. In September 2010, Novartis entered into a settlement with the U.S. Department of Justice to settle False Claims Act lawsuits based in part on violations of the AKS due to illegal remuneration paid to doctors through such mechanisms as speaker programs, and signed a corporate integrity agreement with the U.S. Department of Health and Human Services Office of Inspector General agreeing to implement a rigorous compliance program.

 

Even after entering into the corporate integrity agreement, Novartis’s compliance program failed to prevent kickbacks from being paid in conjunction with Novartis’s speaker programs. No individual at the company was tasked with examining its speaker program data to determine whether the programs were used for an illegitimate purpose. Furthermore, although instances of speaker program abuse were reported to Novartis, sanctions were generally mere slaps on the wrist. In some cases, sales representatives who violated Novartis’s own speaker program policies were nevertheless promoted. Even after September 2010, Novartis continued to conduct bogus speaker programs that were simply vehicles for paying kickbacks to doctors in the form of honoraria and expensive meals.

 

As a consequence of its violations of the Anti-Kickback Statute , Novartis has caused the submission of numerous false claims for drugs to federal health care programs, including Medicare, Medicaid, TRICARE and the Department of Veterans Affairs health care program, resulting in millions of dollars in reimbursements. Novartis’s unlawful conduct caused those false claims to be made to and paid by the federal health care programs.

The complaint seeks treble damages and penalties under the False Claims Act for the false claims for reimbursement for Lotrel, Valturna, and Stalix, as well as for other Novartis cardiovascular drugs. In addition, the United States seeks damages under the common law.

 

The complaint was filed in a lawsuit brought under the qui tam, or whistleblower, provisions of the False Claims Act by Oswald Bilotta, a former Novartis sales representative. Under the Act’s qui tam provisions, a private citizen, known as a “relator,” can sue on behalf of the United States and share in any recovery. The United States may join the lawsuit, as it has here. The lawsuit is United States ex rel. Bilotta v. Novartis Pharmaceuticals Corporation et al., No. 11-cv-0071 (S.D.N.Y.). The claims in the complaint filed by the government are allegations only, and there has been no determination of liability.

 

On April 23, 2013, the United States filed a separate complaint in the Southern District of New York against Novartis, alleging that the company gave kickbacks, in the form of rebates and discounts, to pharmacies in exchange for the pharmacies’ agreement to switch transplant patients from competitor drugs to a Novartis product. As here, that complaint seeks treble damages and civil penalties under the False Claims Act and remedies under the common law.

 

This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. 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 that effort is the False Claims Act, which the Justice Department has used to recover more than $10.3 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $14.2 billion.

Antonio Morales, a resident of Brooklyn, N.Y., pleaded guilty today in U.S. District Court in the Eastern District of New York to aiding in the preparation of a false federal tax return, the Justice Department and Internal Revenue Service (IRS) announced.

 

According to court records and admissions made by the defendant in court today, Morales owned T&R Environment Corp., a construction and sanitation business located in Brooklyn. Morales cashed T&R’s business checks at a check casher and falsely informed his return preparer that T&R was an inactive company. Morales then filed four false corporate income tax returns for tax years 2004 through 2007 that reported no gross receipts for T&R even though T&R generated gross revenue of at least $472,337 during that four year period. Morales admitted that his failure to report T&R’s gross receipts caused a tax loss to the IRS approximating $160,593.

 

Morales faces a potential maximum sentence of three years in prison and a maximum fine of $250,000. A sentencing date has not been set.

 

The case was investigated by IRS - Criminal Investigation and is being prosecuted by Trial Attorneys Mark Kotila and Jeffrey Bender of the Justice Department’s Tax Division.

As the United States concludes its recognition of National Crime Victims’ Rights Week, Acting Assistant Attorney General Mythili Raman announced that the Department of Justice’s Asset Forfeiture Program has returned more than $1.5 billion in forfeited assets to more than 400,000 crime victims since January 2012.  The funds were distributed through the forfeited assets distribution program managed by the Criminal Division’s Asset Forfeiture and Money Laundering Section (AFMLS). 

“Returning forfeited funds to crime victims is an essential ingredient in achieving justice,” said Acting Assistant Attorney General Raman.  “Fulfilling this important mission, the department has distributed over $1.5 billion over the past 16 months to victims of fraud and others.  I commend the prosecutors in the Criminal Division and U.S. Attorneys’ Offices around the country, as well as the many federal, state and local law enforcement agents, who have worked so hard to reach this milestone.”  

AFMLS, in close coordination with the U.S. Attorneys’ offices and federal law enforcement agencies, reviews and rules on petitions for remission submitted by crime victims.  During the past decade, AFMLS has partnered with federal regulatory agencies, court-appointed receivers, private claim administrators, and private class action cases to successfully return more than $3 billion in forfeited assets to crime victims.

Noteworthy cases include: 

$729 Million to Victims of Adelphia Communications

Adelphia Communications Corporation was the fifth-largest cable television company in the United States before going bankrupt in 2002 as a result of fraud committed by its principal owners, the Rigas family.  In April 2005, the U.S. Attorney’s Office for the Southern District of New York entered into settlement agreements with Adelphia and the Rigas family, including forfeitures of cash, stock of Time Warner Cable Inc. (purchaser of Adelphia assets), real estate, and the proceeds from a litigation trust.  The total value of the forfeited assets, including accrued interest, was approximately $729 million.  AFMLS approved the appointment of a special master to identify and notify victims of the remission, process victim petitions, make decision recommendations, and distribute the forfeited funds.  In April 2012, the special master commenced distribution of funds to 8,727 victims.  

$65 Million to Victims of Enron Securities Fraud

In June 2012, the Criminal Division released approximately $65 million in forfeited funds to the Securities and Exchange Commission (SEC) for distribution to approximately 128,200 victims of the Enron Corporation securities fraud.  The funds were forfeited in several criminal and civil actions handled by the Department of Justice’s Enron Task Force, the Fraud Section of the Criminal Division and AFMLS.  In the late 1990s, Enron was the nation’s largest natural gas and electricity marketer.  Beginning in 1997, principals of Enron defrauded Enron’s shareholders by using off-balance-sheet transactions with certain Special Purpose Entities (SPE) the principals controlled.  As a result of these illegal actions, Enron’s stock price dropped from more than $80 per share to less than $1.  Enron eventually filed for bankruptcy in 2001.

$45 Million to Victims of Qwest Communications Fraud

Between April 2012 and April 2013, the Criminal Division distributed approximately $45 million to approximately 112,200 victims of fraud committed by Qwest Communications International Inc.  The funds were forfeited to the United States as a result of the 2007 federal conviction of Qwest’s Chief Executive Officer, Joseph P. Nacchio, for securities fraud.  Between 1999 and 2002, Nacchio and Qwest issued false and misleading statements to the public about the company’s financial condition in order to meet revenue projections.  After the irregularities were discovered, Qwest stock, which had traded as high as $55 per share, plummeted to about $1 per share.  The prosecution of Nacchio was handled by the U.S. Attorney’s Office for the District of Colorado. 

$20 Million to Victims of Warshak/Berkeley Products Fraud

On June 14, 2012, the Criminal Division released $23 million in forfeited funds to 138,426 victims of a nutritional supplement fraud.  Customers who requested a free sample of the Berkeley “sexual enhancement” product were fraudulently billed for additional products they did not order.  The prosecution of Berkeley and its principal, Steven Warshak, and related forfeitures were handled by the U.S. Attorney’s Office for the Southern District of Ohio.

$1.3 Million to Victims of ICT Telemarketing Fraud

In December 2012, the Criminal Division distributed approximately $1.3 million to victims of Integrated Check Technologies (ICT), a payment processor.   ICT withdrew funds from victims’ bank accounts without their authorization in furtherance of a telemarketing fraud scheme.  Approximately $2.9 million was civilly forfeited by the U.S. Attorney’s Office for the Western District of New York.  The Criminal Division approved more than 3,600 petitions with verified losses of $1.3 million.  Because the amount recovered through forfeiture exceeded the victims’ total losses, each victim received a 100 percent reimbursement. 

$2.4 Million to Victims of “UniDyn” Securities Fraud

In February 2013, the Criminal Division distributed $2.4 million to victims of a “pump and dump” securities fraud orchestrated by Randy Jenkins and Ira Gentry.  Jenkins and Gentry secretly acquired millions of shares of UniDyn on the Over the Counter market and posted messages online falsely touting the company’s earning potential.  After having fraudulently “pumped” the value of UniDyn stock, Jenkins and Gentry proceeded to “dump” their holdings on unsuspecting buyers.  Jenkins and Gentry were convicted of multiple counts of securities fraud, wire fraud, and money laundering, and one count of tax evasion.  In related civil actions, the United States Attorney’s Office for the District of Arizona obtained forfeitures of cash and real and personal property valued at approximately $3.35 million.   About 660 persons submitted petitions for remission, of which 466 were approved by AFMLS, with confirmed losses of $5.8 million. 

Additional information about the Justice Department’s asset forfeiture recovery efforts can be found at www.justice.gov/criminal/afmls.

T he International Competition Network (ICN) advanced convergence through important initiatives on international enforcement cooperation and investigative processes in competition cases, the Department of Justice announced today. The ICN adopted new work product on economic analysis in merger review, legal theories in exclusive dealing investigations, international cooperation and information sharing in cartel enforcement, and the benefits of competition.

 

The 12th annual ICN conference, hosted by Poland’s Office of Competition and Consumer Protection (OCCP), was held on April 24-26, 2013, in Warsaw, Poland. More than 500 delegates participated, representing more than 80 antitrust agencies from around the world, including competition experts from international organizations and the legal, business, consumer and academic communities. Assistant Attorney General Bill Baer of the Department of Justice’s Antitrust Division and Federal Trade Commission (FTC) Chairwoman Edith Ramirez led the U.S. delegation. The conference showcased the achievements of ICN working groups on cartels, competition advocacy, competition agency effectiveness, mergers and unilateral conduct.

 

“One of the defining characteristics of the ICN is the deep engagement of its members on critical antitrust issues, including mergers, anti-cartel enforcement, unilateral conduct and competition advocacy,” said Assistant Attorney General Baer. “The discussions and work product emerging from this meeting strengthen the ties between U.S. enforcers and our counterparts around the globe and enhance effective antitrust enforcement for the benefit of all consumers.”

 

Bronislaw Komorowski, the President of Poland, provided opening remarks at the conference. John Fingleton, former Chief Executive of the UK Office of Fair Trading and former ICN Steering Group Chair, moderated a panel on competition and its relevance to global economic policy discussion among representatives from the World Trade Organization, World Bank and International Chamber of Commerce. Joaquin Almunia, European Commission Vice President and Commissioner for Competition, also addressed the conference. Eduardo P é rez Motta, ICN Steering Group Chair and President of the Mexican Federal Competition Commission, spoke about his initiatives to support ICN member competition advocacy and enhance cooperation with international organizations .

 

Assistant Attorney General Baer moderated a panel of antitrust officials on international enforcement cooperation to discuss the strengths and limitations of current cooperation frameworks. The panel also discussed future ICN work that could best help antitrust agencies address the challenges of engaging effectively in international enforcement cooperation. Over the past year, the ICN partnered with the Organization for Economic Cooperation and Development (OECD)’s Competition Committee on a comprehensive study of the state of international enforcement cooperation. Lynda K. Marshall, Assistant Chief of the Department of Justice’s Antitrust Division’s Foreign Commerce Section, led a discussion on future work on international cooperation in cartel enforcement.

 

The Polish OCCP led a special project devoted to the interaction between competition agencies and courts, culminating in a session led by OCCP President Malgorzata Krasnodebska-Tomkiel. FTC Chairwoman Ramirez addressed the vital role of economic evidence in competition cases and offered guidance for how to effectively present this evidence to generalist courts. She also highlighted the various tools available to competition agencies to encourage courts to recognize competition law principles.

 

“This 12th annual ICN conference demonstrated how competition agencies from around the world can come together both to advance convergence toward best practices in antitrust enforcement and to strengthen the voice of competition policy as our governments confront common economic challenges,” said Chairwoman Ramirez.

 

The conference also highlighted the work of the Cartel Working Group, co-chaired by the Department of Justice, the Japan Fair Trade Commission and Germany’s Bundeskartellamt. The working group brings together antitrust enforcers to address the challenges of anti-cartel enforcement, through the examination of important policy issues and the exchange of effective investigative techniques. The group presented a new chapter on international cooperation and information sharing for its Anti-Cartel Enforcement Manual, a reference tool for antitrust agencies on effective investigative techniques.

 

The Agency Effectiveness Working Group, co-chaired by the FTC, the Mexican Federal Competition Commission and the Norwegian Competition Authority, examines the institutions and procedures that support the enforcement missions of competition agencies. Randolph W. Tritell, Director of the FTC’s Office of International Affairs , led a panel discussion and presentation of the group’s work related to investigative tools and agency transparency practices, part of a project on investigative processes in competition cases. The working group also presented two new chapters on effective knowledge management and human resources management for its competition agency practice manual.

 

The conference showcased the ICN Curriculum Project, a project led by the FTC to create a “virtual university” of training materials on competition law and practice.  FTC Counsel Paul O’Brien presented the Curriculum Project and its new modules on planning and conducting investigations, competition advocacy and challenges for agencies in developing countries.

 

The Merger Working Group, co-chaired by the European Commission’s Competition Directorate, the Competition Commission of India (CCI) and the Italian Competition Authority aims to promote best practices in the design and operation of merger review regimes. The FTC’s Director of the Bureau of Economics, Howard Shelanski, participated in a panel discussion of the role of economic analysis in merger review. The panel highlighted the group’s new work addressing the role of economic evidence in merger analysis, a comprehensive overview of the qualitative and quantitative analyses available to antitrust agencies for the review of horizontal mergers.

 

The Unilateral Conduct Working Group, co-chaired by the Swedish Competition Authority, the Turkish Competition Authority, and the UK Office of Fair Trading, promotes convergence and sound enforcement of laws governing conduct by firms with substantial market power.   T he working group presented a new workbook chapter on exclusive dealing arrangements as part of a project that is producing a practical guide to the investigation of the various types of unilateral conduct.

 

The Advocacy Working Group, co-chaired by the French Autorité de la Concurrence, the Portuguese Competition Authority and the Competition Commission of Mauritius, develops practical tools and guidance to improve the effectiveness of ICN members’ competition advocacy. This year, the working group developed draft guidance on procedures and analysis for assessing existing or proposed laws and regulations to determine whether they may have a significant impact on competition. The group also presented its work on practical techniques to help promote a competition culture and strategies for explaining the benefits of competition to other government entities.

 

The ICN was created in October 2001, when the Department of Justice and the FTC joined antitrust agencies from 13 other jurisdictions to increase understanding of competition policy and promote convergence toward best practices around the world. The ICN now includes 126 member agencies from 111 jurisdictions.

 

ICN documents are available at www.internationalcompetitionnetwork.org .

Several residents of Montgomery, Ala., were indicted by a federal grand jury for their involvement in a conspiracy to receive fraudulent tax refunds into their bank accounts, the Justice Department and the Internal Revenue Service (IRS) announced today. Tarrish Tellis, Bobby Joe Means, Delancy Tolliver, Tracey Montgomery and Glenn Powell Jr. were indicted on various charges, including conspiracy and theft of government money. Tellis was also indicted on five counts of aggravated identity theft.

 

According to the indictment, Tellis obtained the means of identification of individuals, including their names, dates of birth, and Social Security numbers for the purpose of filing false federal income tax returns. Means, Tolliver, Montgomery and Powell provided Tellis with bank account numbers that were to receive the false federal income tax refunds. Tellis would then use the bank account numbers and means of identification to cause to be prepared and filed false federal income tax returns with the IRS. After the false refunds were deposited, Means, Tolliver, Montgomery and Powell would withdraw the funds. The bank accounts received at least $500,000 in false tax refunds.

 

An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, each of the defendants face a maximum potential sentence of five years in prison for the conspiracy charge, up to ten years in prison on each theft of government funds charges. Tellis also faces a mandatory two-year sentence for the aggravated identity theft counts. The defendants will also be subject to fines and mandatory restitution if convicted.

 

This case was investigated by special agents of IRS - Criminal Investigation. Trial Attorneys Charles M. Edgar Jr., Michael Boteler, and Greg Bailey of the Justice Department's Tax Division are prosecuting the case, with the assistance from the U.S. Attorney's Office for the Middle District of Alabama and, in particular, Assistant U.S. Attorney Todd Brown.

A federal grand jury in Montgomery, Ala., returned an indictment charging Harvey James for using stolen identities to file false tax returns, the Justice Department the Internal Revenue Service (IRS) announced today. The 34-count indictment charges James with mail fraud and aggravated identity theft.

 

According to the indictment, Harvey James obtained stolen identities from individuals who had access to inmate information from the Alabama Department of Corrections. James and others used those inmate names to file false federal and state tax refunds. James directed some of the false refunds to be sent to either prepaid debit cards or issued via check. He directed some of the prepaid debit cards and state tax refund checks to be mailed to various addresses on a U.S. Postal Service mail carrier’s route which was located in Montgomery, Ala. Between 2010 and 2012, James and others are alleged to have filed over 2,000 federal and state income tax returns that claimed over $2.5 million in fraudulent tax refunds.

An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, James faces 20 years imprisonment for each mail fraud count and a mandatory 2-year sentence for the aggravated identity theft counts. He is also subject to fines, mandatory restitution, and forfeiture if convicted.

The case was investigated by Special Agents of the IRS - Criminal Investigation. Trial Attorneys Jason H. Poole and Michael Boteler of the Justice Department’s Tax Division and Assistant U.S. Attorney Todd Brown are prosecuting the case.

 

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

A one-count indictment was unsealed today in U.S. District Court for the District of Columbia charging Marta Rita Velazquez, 55, with conspiracy to commit espionage, announced John Carlin, Acting Assistant Attorney General for National Security;   Ronald C. Machen Jr., U.S. Attorney for the District of Columbia; and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office.

The charges against Velazquez stem from, among other things, her alleged role in introducing Ana Belen Montes, now 55, to the Cuban Intelligence Service (CuIS) in 1984; in facilitating Montes’s recruitment by the CuIS; and in helping Montes later gain employment at the U.S. Defense Intelligence Agency (DIA).  Montes served as an intelligence analyst at DIA from September 1985 until she was arrested for espionage by FBI agents on Sept. 21, 2001.  On March 19, 2002, Montes pleaded guilty in the District of Columbia to conspiracy to commit espionage on behalf of Cuba.  Montes is currently serving a 25-year prison sentence.

The indictment against Velazquez, who is also known as “Marta Rita Kviele” and as “Barbara,” was originally returned by a grand jury in the District of Columbia on Feb. 5, 2004.  It has remained under court seal until today.  Velazquez has continuously remained outside the United States since 2002.  She is currently living in Stockholm, Sweden.   If convicted of the charges against her, Velazquez faces a potential sentence of up to life in prison. 

According to the indictment, Velazquez was born in Puerto Rico in 1957.  She graduated from Princeton University in 1979 with a bachelor’s degree in Political Science and Latin American Studies.  Velazquez later obtained a law degree from Georgetown University Law Center in 1982 and a master’s degree from Johns Hopkins University School of Advanced International Studies (SAIS) in Washington, D.C., in 1984. 

Velazquez later served as an attorney advisor at the U.S. Department of Transportation, and, in 1989, she joined the State Department’s U.S. Agency for International Development (USAID) as a legal officer with responsibilities encompassing Central America.  During her tenure at USAID, Velazquez held a Top Secret security clearance and was posted to the U.S. Embassies in Nicaragua and Guatemala.  In June 2002, Velazquez resigned from USAID following press reports that Montes had pleaded guilty to espionage and was cooperating with the U.S. government.  Velazquez has remained outside the United States since 2002. 

The indictment alleges that, beginning in or about 1983, Velazquez conspired with others to transmit to the Cuban government and its agents documents and information relating to the U.S. national defense, with the intent that they would be used to the injury of the United States and to the advantage of the Cuban government.

As part of the conspiracy, Velazquez allegedly helped the CuIS spot, assess and recruit U.S. citizens who occupied sensitive national security positions or had the potential of occupying such positions in the future to serve as Cuban agents.   For example, the indictment alleges that, while Velazquez was a student together with Montes at SAIS in Washington, D.C., in the early 1980s, Velazquez fostered a strong, personal friendship with Montes, with both sharing similar views of U.S. policies in Nicaragua at the time.

In December 1984, the indictment alleges, Velazquez introduced Montes in New York City to a Cuban intelligence officer who identified himself as an official of the Cuban Mission to the United States.  The intelligence officer then recruited Montes.  In 1985, after Montes’ recruitment, Velazquez personally accompanied Montes on a clandestine trip to Cuba for Montes to receive spy craft training from CuIS. 

Later in 1985, Velazquez allegedly helped Montes obtain employment as an intelligence analyst at the DIA, where Montes had access to classified national defense information and served as an agent of the CuIS until her arrest in 2001. During her tenure at the DIA, Montes disclosed the identities of U.S. intelligence officers and provided other classified national defense information to the CuIS.

During this timeframe, Velazquez allegedly continued to serve the CuIS, receiving instructions from the CuIS through encrypted, high frequency broadcasts from her handlers and through meetings with handlers outside the United States.

This case was investigated by the FBI’s Washington Field Office and the DIA.  It is being prosecuted by Senior Trial Attorney Clifford Rones of the Counterespionage Section in the Justice Department’s National Security Division, and Assistant U.S. Attorney G. Michael Harvey of the U.S. Attorney’s Office for the District of Columbia.

The charges contained in an indictment are merely allegations and each defendant is presumed innocent unless and until proven guilty in a court of law.
WASHINGTON – A one-count indictment was unsealed today in U.S. District Court for the District of Columbia charging Marta Rita Velazquez, 55, with conspiracy to commit espionage, announced John Carlin, Acting Assistant Attorney General for National Security;   Ronald C. Machen Jr., U.S. Attorney for the District of Columbia; and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office.

The charges against Velazquez stem from, among other things, her alleged role in introducing Ana Belen Montes, now 55, to the Cuban Intelligence Service (CuIS) in 1984; in facilitating Montes’s recruitment by the CuIS; and in helping Montes later gain employment at the U.S. Defense Intelligence Agency (DIA).  Montes served as an intelligence analyst at DIA from September 1985 until she was arrested for espionage by FBI agents on Sept. 21, 2001.  On March 19, 2002, Montes pleaded guilty in the District of Columbia to conspiracy to commit espionage on behalf of Cuba.  Montes is currently serving a 25-year prison sentence.

The indictment against Velazquez, who is also known as “Marta Rita Kviele” and as “Barbara,” was originally returned by a grand jury in the District of Columbia on Feb. 5, 2004.  It has remained under court seal until today.  Velazquez has continuously remained outside the United States since 2002.  She is currently living in Stockholm, Sweden.   If convicted of the charges against her, Velazquez faces a potential sentence of up to life in prison. 

According to the indictment, Velazquez was born in Puerto Rico in 1957.  She graduated from Princeton University in 1979 with a bachelor’s degree in Political Science and Latin American Studies.  Velazquez later obtained a law degree from Georgetown University Law Center in 1982 and a master’s degree from Johns Hopkins University School of Advanced International Studies (SAIS) in Washington, D.C., in 1984. 

Velazquez later served as an attorney advisor at the U.S. Department of Transportation, and, in 1989, she joined the State Department’s U.S. Agency for International Development (USAID) as a legal officer with responsibilities encompassing Central America.  During her tenure at USAID, Velazquez held a Top Secret security clearance and was posted to the U.S. Embassies in Nicaragua and Guatemala.  In June 2002, Velazquez resigned from USAID following press reports that Montes had pleaded guilty to espionage and was cooperating with the U.S. government.  Velazquez has remained outside the United States since 2002. 

The indictment alleges that, beginning in or about 1983, Velazquez conspired with others to transmit to the Cuban government and its agents documents and information relating to the U.S. national defense, with the intent that they would be used to the injury of the United States and to the advantage of the Cuban government.

As part of the conspiracy, Velazquez allegedly helped the CuIS spot, assess and recruit U.S. citizens who occupied sensitive national security positions or had the potential of occupying such positions in the future to serve as Cuban agents.   For example, the indictment alleges that, while Velazquez was a student together with Montes at SAIS in Washington, D.C., in the early 1980s, Velazquez fostered a strong, personal friendship with Montes, with both sharing similar views of U.S. policies in Nicaragua at the time.

In December 1984, the indictment alleges, Velazquez introduced Montes in New York City to a Cuban intelligence officer who identified himself as an official of the Cuban Mission to the United States.  The intelligence officer then recruited Montes.  In 1985, after Montes’ recruitment, Velazquez personally accompanied Montes on a clandestine trip to Cuba for Montes to receive spy craft training from CuIS. 

Later in 1985, Velazquez allegedly helped Montes obtain employment as an intelligence analyst at the DIA, where Montes had access to classified national defense information and served as an agent of the CuIS until her arrest in 2001. During her tenure at the DIA, Montes disclosed the identities of U.S. intelligence officers and provided other classified national defense information to the CuIS.

During this timeframe, Velazquez allegedly continued to serve the CuIS, receiving instructions from the CuIS through encrypted, high frequency broadcasts from her handlers and through meetings with handlers outside the United States.

This case was investigated by the FBI’s Washington Field Office and the DIA.  It is being prosecuted by Senior Trial Attorney Clifford Rones of the Counterespionage Section in the Justice Department’s National Security Division, and Assistant U.S. Attorney G. Michael Harvey of the U.S. Attorney’s Office for the District of Columbia.

The charges contained in an indictment are merely allegations and each defendant is presumed innocent unless and until proven guilty in a court of law.

Related Materials:

Indictment

A federal jury today convicted a Miami-area supervisor of a mental health care company, Health Care Solutions Network (HCSN), for helping to orchestrate a fraud scheme that crossed state lines and that resulted in the submission of more than $63 million in fraudulent claims to Medicare and Florida Medicaid.

The announcement was made by 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; Michael B. Steinbach, Special Agent in Charge 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 Investigation’s Miami office.

After a five-day trial, a jury in the Southern District of Florida found Wondera Eason, 51, guilty of conspiracy to commit health care fraud.  Sentencing is scheduled for July 8, 2013.

Eason was employed as the Director of Medical Records at HCSN’s Partial Hospitalization Program (PHP).  A PHP is a form of intensive treatment for severe mental illness. In Florida, HCSN operated community mental health centers at two locations.  After stealing millions from Medicare and Medicaid in Florida, HCSN’s owner, Armando Gonzalez, exported the scheme to North Carolina, opening a third HCSN location in Hendersonville. 

Evidence at trial showed that at all three locations, Eason, a certified medical records technician, oversaw the alteration, fabrication, and forgery of thousands of documents, which purported to support the fraudulent claims HCSN submitted to Medicare and Florida Medicaid.  Many of these medical records were created weeks or months after the patients were admitted to HCSN facilities in Florida for purported PHP treatment and were utilized to support false and fraudulent billing to government sponsored health care benefit programs, including Medicare and Florida Medicaid.  Eason directed therapists to fabricate documents, and she also forged the signature of therapists and others on documents that she was in charge of maintaining.  Eason interacted with Medicare and Medicaid auditors, providing them with false and fraudulent documents, while certifying the documents were accurate.

The “therapy” at HCSN oftentimes consisted of nothing more than patients watching Disney movies, playing bingo and having barbeques.  Eason directed therapists to remove any references to these recreational activities in the medical records.

According to evidence at trial, Eason was aware that HCSN in Florida paid illegal kickbacks to owners and operators of Miami-Dade County Assisted Living Facilities (ALF) in exchange for patient referral information to be used to submit false and fraudulent claims to Medicare and Medicaid.  Eason also knew that many of the ALF referral patients were ineligible for PHP services because many patients suffered from mental retardation, dementia and Alzheimer's disease.

From 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services. 

Fifteen defendants have been charged for their alleged roles in the HCSN health care fraud scheme, and 12 defendants have pleaded guilty. On Monday, Feb. 25, 2013, Gonzalez was sentenced to serve 168 months in prison for his role in the scheme. Alleged co-conspirators Alina Feas and Lisset Palmero are scheduled for trial on June 3, 2013. Defendants are presumed innocent until proven guilty at trial.

This case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division's Fraud Section and the U.S. Attorney's Office for the Southern District of Florida. This case was prosecuted by Trial Attorneys Allan J. Medina and Steven Kim, former Special Trial Attorney William Parente and Deputy Chief Benjamin D. Singer 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 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

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

A Southern California physician, a durable medical equipment (DME) supply company employee and a health care professional were found guilty late yesterday by a federal jury in Los Angeles for their roles in a $1.5 million Medicare fraud scheme, announced Acting Assistant Attorney General Mythili Raman of the Criminal Division; U.S. Attorney for the Central District of California André Birotte Jr.; Bill L. Lewis, Assistant Director in Charge of the FBI’s Los Angeles Field Office; and Glenn R. Ferry, Special Agent in Charge of the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG).

 Godwin Onyeabor, 49, of Ontario, Calif., Sri J. Wijegunaratne, 58, of Anaheim, Calif., and Heidi Morishita, 48, of Valencia, Calif., were each found guilty in U.S. District Court in the Central District of California of one count of conspiracy to pay and receive kickbacks.  Wijegunaratne was also found guilty of conspiracy to commit health care fraud and six substantive counts of health care fraud.  Onyeabor was also found guilty of conspiracy to commit health care fraud and 11 substantive counts of health care fraud.

The trial evidence showed that between January 2007 and February 2012, Onyeabor, an officer at Fendih Medical Supply Inc., a DME supply company located in San Bernadino, Calif., and others paid cash kickbacks to Wijegunaratne, a physician, and Morishita for fraudulent prescriptions for DME, including power wheelchairs.  The evidence showed that Wijegunaratne wrote prescriptions for power wheelchairs and other DME that Medicare beneficiaries did not need and sometimes never used.  After receiving prescriptions from Wijegunaratne and Morishita, Onyeabor and others used the prescriptions to fraudulently bill Medicare for the medically unnecessary DME.

At trial, several Medicare beneficiaries testified that they were lured to medical clinics with the promise of free items such as vitamins and juice, only to receive power wheelchairs that they did not need and did not want.  The beneficiaries further testified that their attempts to reject delivery of the power wheelchairs from Onyeabor’s supply company were unsuccessful. 

As a result of this fraud scheme, Onyeabor, Wijegunaratne and others submitted and caused the submission of approximately $1.5 million in false and fraudulent claims to Medicare, and received almost $1 million on those claims.

At sentencing, scheduled for Sept. 9, 2013, Onyeabor, Wijegunaratne and Morishita face a maximum penalty of 10 years in prison and a $250,000 fine for each count.

The case is being prosecuted by Assistant Chief Benton Curtis and Trial Attorneys Fred Medick and Alexander Porter of the Criminal Division’s Fraud Section.  The case was investigated by the FBI and the Los Angeles Region of HHS-OIG. 

The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 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.  To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.

Fresno, California -- José Hernàndez-Velàzquez, de 55 años, residente de Van Nuys y dueño de una propiedad de alquiler en Delano, fue sentenciado hoy a 60 años de prisión por el Juez de Distrito de los Estados Unidos Lawrence J. O’Neill, anunció Benjamin B. Wagner Fiscal de los Estados Unidos. El 12 de diciembre de 2012, un jurado federal encontró a Hernàndez-Velàzquez culpable de 4 cargos separados de producir pornografía infantil.

El Fiscal de los Estados Unidos Wagner afirmó: “La sentencia de prisión dictada hoy, niega a Hernàndez-Velàzquez la oportunidad de depredar a màs niños. Aquellos que cometen delitos similares deben esperar por seguro que seràn encontrados, procesados y removidos de la sociedad"

“Como esta sentencia muestra con toda claridad, los predadores infantiles recibiràn la justicia que merecen por sus despreciables acciones,” dijo Michael Toms, agente residente encargado de HSI Bakersfield. “Continuaremos persiguiendo agresivamente a aquellos que depredan y explotan sexualmente a nuestros hijos. Se lo debemos a las jóvenes víctimas de estos casos, quienes llevaràn consigo las cicatrices emocionales y físicas de estos delitos durante el resto de sus vidas.”

De acuerdo con los documentos del tribunal, Hernàndez-Velàzquez produjo videos e imàgenes entre enero de 2010 y febrero de 2011 que incluían representaciones de él participando en actos sexuales con cuatro víctimas menores diferentes de edades comprendidas entre los 3 y los 14 años. De acuerdo con los registros del tribunal, la investigación comenzó con una pista dada por una persona particular. En 24 horas, los investigadores tomaron posesión de la càmara y los dispositivos de almacenamiento de datos de Hernàndez-Velàzquez, determinaron el lugar de los delitos, identificaron a las víctimas, y obtuvieron de él declaraciones incriminatorias. Los delitos se produjeron en Delano donde Hernàndez-Velàzquez era el dueño de una propiedad de alquiler.

A la conclusión de la vista de sentencia, el Juez O’Neill informó a Hernàndez-Velàzquez que era su intención que “nunca se le permitiera estar en ninguna parte cerca de un niño. Usted ha arruinado ya bastantes vidas.” Hernàndez-Velàzquez ha estado bajo custodia desde su arresto el 9 de marzo de 2011.

Este caso fue producto de una intensa investigación por parte de las oficinas del Servicio de  Inmigración y Control de Aduanas de los EE.UU. (ICE) de Bakersfield y  Los Ángeles, La Oficina de Investigaciones de Seguridad Nacional (HSI), el Departamento de Policía de Los Ángeles, y el Departamento de Policía de Delano. El Fiscal Adjunto de los EE.UU., Brian W. Enos, procesó el caso.

Este caso fue entablado como parte del Proyecto de Infancia Segura, una iniciativa nacional lanzada en mayo de 2006 por el Departamento de Justicia para combatir la epidemia creciente de explotación y abuso sexual de menores. Fue conducida por las Oficinas de los Fiscales de los Estados Unidos y la Sección de Explotación y Obscenidad Infantiles de la División Criminal, agentes federales del Proyecto Infancia Segura y recursos federales, estatales y locales con el fin de localizar, arrestar y procesar  a aquellos que explotan sexualmente a niños, y para identificar y rescatar a las víctimas. Para màs información acerca del Proyecto Infancia Segura, por favor visite www.usdoj.gov/psc. Haga clic en la pestaña “recursos” para información sobre educación de seguridad en Internet.

A financial investor who purchased municipal tax liens pleaded guilty today for his role in a conspiracy to rig bids for the sale of tax liens auctioned by municipalities in New Jersey, the Department of Justice announced.

A felony charge was filed today in U.S. District Court for the District of New Jersey in Newark, against Norman T. Remick, of Barnegat, N.J.  According to the charge, from in or about the beginning of 2007 until approximately February 2009, Remick participated in a conspiracy to rig bids at auctions for the sale of municipal tax liens in New Jersey by agreeing to allocate among certain bidders which liens each would bid on.  The department said that Remick proceeded to submit bids in accordance with the agreements and purchased tax liens at collusive and non-competitive interest rates.

“The conspirators illegally met and engaged in anticompetitive discussions to allocate bids amongst themselves at tax lien auctions in New Jersey, depriving distressed homeowners of competitive interest rates at a time when they most needed them,” said Scott D. Hammond, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program. “Prosecuting these types of bid-rigging schemes remains a top priority for the division.”

The department said that the primary purpose of the conspiracy was to suppress and restrain competition in order to obtain selected municipal tax liens offered at public auctions at non-competitive interest rates. When the owner of real property fails to pay taxes on that property, the municipality in which the property is located may attach a lien for the amount of the unpaid taxes. If the taxes remain unpaid after a waiting period, the lien may be sold at auction. State law requires that investors bid on the interest rate delinquent property owners will pay upon redemption. By law, the bid opens at 18 percent interest and, through a competitive bidding process, can be driven down to zero percent. If a lien remains unpaid after a certain period of time, the investor who purchased the lien may begin foreclosure proceedings against the property to which the lien is attached. 

According to the court documents, Remick was involved in a conspiracy with others not to bid against one another at municipal tax lien auctions in New Jersey. Since the conspiracy permitted the conspirators to purchase tax liens with limited competition, each conspirator was able to obtain liens that earned a higher interest rate. Property owners were, therefore, made to pay higher interest on their tax debts than they would have paid had their liens been purchased through open and honest competition, the department said.

 
A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals.  The maximum fine for a Sherman Act violation may be increased to twice the gain derived from the crime or twice the loss suffered by the victims if either amount is greater than the $1 million statutory maximum.

 

Today’s plea is the 12th guilty plea resulting from an ongoing investigation into bid rigging or fraud related to municipal tax lien auctions. Eight individuals – Isadore H. May, Richard J. Pisciotta Jr., William A. Collins, Robert W. Stein, David M. Farber, Robert E. Rothman, Stephen E. Hruby and David Butler – and three companies – DSBD LLC, Crusader Servicing Corp. and Mercer S.M.E. Inc. – have previously pleaded guilty as part of this investigation.

Today’s charge was brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.

This ongoing investigation is being conducted by the Antitrust Division’s New York  Office and the FBI’s Atlantic City, N.J., office. Anyone with information concerning bid rigging or fraud related to municipal tax lien auctions should contact the Antitrust Division’s New York Field Office at 212-335-8000, visit www.justice.gov/atr/contact/newcase.htm or contact the Atlantic City Resident Agency of the FBI at 609-677-6400.

The Justice Department announced today that it reached a settlement agreement with the Metropolitan School District of Decatur Township, Ind., to prevent and respond to peer on peer harassment in schools.

 

The agreement resolves the department’s review of the district’s policies and practices related to harassment and bullying, which was initiated in June 2011 after reports of possible racial harassment at a district school. Under the agreement, the district will work closely with the Great Lakes Equity Center, a federally funded resource center at Indiana University-Purdue University Indianapolis, to take a number of steps to prevent and address harassment based on race, color, national origin, sex, religion and disability, and to ensure a safe and supportive learning environment for all students.

 

Among other things, the district will: form a district-wide anti-harassment task force, which will review and revise the district’s policies and procedures related to harassment, bullying and discipline; establish a cohesive process for receiving, investigating and monitoring complaints of harassment and bullying, enabling the district to track repeated incidents involving individual students or groups targeted for their membership in a protected class; and provide training, professional development and school climate assessments for both students and staff at two of the district’s schools.

 

“This agreement provides a template for school districts throughout Indiana and across the country in establishing an across the board strategy for preventing and addressing harassment and bullying,” said Jocelyn Samuels, Principal Deputy Assistant Attorney General for the Civil Rights Division.  “We applaud the district for taking affirmative steps to foster a safe and inclusive climate for learning.”

 

Throughout the country, school districts are expanding efforts to prevent and respond to bullying. Student misconduct that falls under a school’s anti-bullying policy also may trigger the school district’s obligations to combat discrimination and harassment under one or more of the federal civil rights laws. Today’s agreement will provide a roadmap for districts working to ensure that their critical bullying prevention efforts are consistent with their obligations under federal law, including Title IV of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race, color, national origin, religion and sex, in public schools.

 

The enforcement of Title IV is a top priority of the Justice Department’s Civil Rights Division.  Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt .

Related Materials:

Decatur Agreement

The Justice Department announced today that it has reached an agreement with the city of Falls Church, Va., that will allow for the city, a covered jurisdiction under the special provisions of the Voting Rights Act, to bail out from coverage under these provisions. Bailout will exempt the city of Falls Church, along with the Falls Church City Public School District, from the preclearance requirements of Section 5 of the Voting Rights Act. The agreement is in the form of a consent decree filed today in the U.S. District Court for the District of Columbia and must be approved by the court.

 

Under Section 5 of the Voting Rights Act, certain covered jurisdictions, determined according to Section 4 of the Act, are required to seek preclearance for any changes in voting qualifications, standards, practices or procedures from the U.S. District Court for the District of Columbia or from the U.S. Attorney General, prior to their implementation. Section 4 of the Act provides that a covered jurisdiction may seek to “bail out,” or remove itself from such coverage, and therefore be exempted from the preclearance requirements, by seeking a declaratory judgment before a three-judge panel in the U.S. District Court for the District of Columbia. A bailout judgment can be issued only if the court determines that the jurisdiction meets certain eligibility requirements for bailout contained in the statute, including a 10-year record of nondiscrimination in voting-related actions. The act also provides that the Attorney General can consent to entry of a judgment of bailout only if, based upon investigation, the Attorney General is satisfied that the jurisdiction meets the eligibility requirements.

 

The city of Falls Church filed its bailout action in the U.S. District Court for the District of Columbia on Feb. 15, 2013. Counsel for the city contacted the Attorney General prior to filing the action, indicating that the city was interested in seeking bailout. The city provided the Justice Department with substantial information, and the department conducted an investigation to determine the city’s eligibility. Based on that investigation, the department is satisfied that the city of Falls Church meets the Voting Rights Act’s requirements for bailout.

 

“In the department’s view, the city of Falls Church has met the requirements necessary for bailout. We reached this conclusion after thoroughly reviewing information provided by the city and information gathered during the Department’s independent investigation,” said Matthew Colangelo, Deputy Assistant Attorney General for the Civil Rights Division. “We appreciate the city’s cooperation in the resolution of this matter.”

 

The consent decree details the legal and factual basis for a bailout determination and, if approved by the court, the city’s request will be granted. The court will retain jurisdiction of the action for 10 years and can reopen the action upon the motion of the Attorney General or any aggrieved person alleging conduct by the city that would have originally precluded the city from bailing out if it had occurred during the 10-year period preceding entry of the consent decree.

 

Information about bailout, the Voting Rights Act and other federal voting laws is available on the Department of Justice website at www.justice.gov/crt/voting . Complaints may be reported to the Voting Section of the Justice Department’s Civil Rights Division at 1-800-253-3931.

Related Materials:

Falls Church Joint Motion and Consent Decree

Brandon Shane Mundy, a former police officer of numerous law enforcement agencies, the most recent being the Town Creek, Ala., Police Department, pleaded guilty today to violating the civil rights of a man during the course of an arrest. According to information presented to the court, on Nov. 22, 2009, Mundy was involved in a vehicle pursuit and fired shots at a man’s vehicle before later ramming it and causing it to wreck in a ditch. While another police officer reached the man and placed him under arrest without resistance, Mundy ran up and unjustifiably and repeatedly beat the man in the head with an object that was either a baton or a flashlight causing the man to suffer physical injury. After Mundy lost control of the object, Mundy continued to strike the man in the head with his fist.

“The use of excessive force cannot be tolerated,” said Roy L. Austin Jr., Deputy Assistant Attorney General for the Civil Rights Division. “The vast majority of police officers do an outstanding job in protecting both the community and the rights of the accused, even in stressful situations. But when police officers use excessive force to punish arrestees, they will be held accountable.”

 

“Police officers who abuse their power in order to assault citizens undermine the system of constitutional government they are sworn to uphold,” said Joyce White Vance, U.S. Attorney for the Northern District of Alabama. “As the plea in this case shows, my office will work closely with the Justice Department’s Civil Rights Division to aggressively enforce the laws that prohibit police misconduct.”

 

Mundy faces a statutory maximum sentence of 10 years in prison. A sentencing date has not yet been set.

 

This case is being investigated by the FBI and prosecuted by Assistant U.S. Attorney Elizabeth Holt of the Northern District of Alabama and Civil Rights Division Trial Attorney Daniel H. Weiss.

ALICIA A. G. LIMTIACO, United States Attorney for the Districts of Guam and the
Northern Mariana Islands, announced that a criminal complaint was filed against two individuals and a corporation on April 19, 2013. A copy of the unsealed complaint is attached. The complaint charges GEORGE QUE, TIM BLYTHE, and the entity known as HONG KONG ENTERTAINMENT (OVERSEAS) INVESTMENTS, LTD. dba TINIAN DYNASTY HOTEL & CASINO with conspiracy to cause a financial institution to fail to file currency transaction reports and causing a financial institution to fail to file currency transaction reports. The maximum sentence for each offense is imprisonment for not more than 10 years, a fine of not more than $500,000 for an individual, and a fine of not more than $1,000,000 for a corporation.

Federal law requires that a Currency Transaction Report (CTR) be filed with the IRS by financial institutions, including casinos, in regard to any currency transaction over $10,000.

According to the criminal complaint, beginning in or around September 2009 and continuing through the present, the TINIAN DYNASTY HOTEL & CASINO engaged in a pattern of accommodating gamblers in conducting transactions involving more than $10,000 without filing CTRs with the government. Defendants BLYTHE and QUE allegedly did not file any CTRs or cause anyone else to do so, despite their knowledge of the reporting requirement.

The criminal complaint alleges that in May 2012, IRS Criminal Investigation initiated an undercover operation concerning possible illegal activities at the TINIAN DYNASTY HOTEL & CASINO by having two agents pose as gamblers wishing to use large amounts of currency but not wanting any reports filed with the government about their use of cash. Between February 28, 2013, and March 4, 2013, HONG KONG ENTERTAINMENT (OVERSEAS) INVESTMENTS, LTD. dba TINIAN DYNASTY HOTEL & CASINO, GEORGE QUE, and TIM BLYTHE caused the TINIAN DYNASTY HOTEL & CASINO to fail to file required CTRs related to nine transactions involving undercover IRS agents. Each of these transactions, individually, exceeded the reporting threshold for CTRs.

The criminal complaint states that, upon conviction, HONG KONG ENTERTAINMENT (OVERSEAS) INVESTMENTS, LTD. dba TINIAN DYNASTY HOTEL & CASINO, GEORGE QUE, and TIM BLYTHE would forfeit their interest in two bank accounts held in Guam, two bank accounts held in Saipan, and in the TINIAN DYNASTY HOTEL & CASINO.

This Thursday morning, April 25, 2013, federal agents executed a federal search warrant on the TINIAN DYNASTY HOTEL & CASINO. In conjunction with the search warrant execution, QUE was arrested. Federal agents also executed warrants to seize property subject to forfeiture at the TINIAN DYNASTY HOTEL & CASINO, and its bank accounts.

QUE appeared in court this afternoon before Designated Judge Robert C. Naraja who ordered that he be released on conditions including verification of location monitoring at his residence by the U.S. Probation Office. An arrest warrant is outstanding for BLYTHE. Chief Judge Ramona V. Manglona of the District Court of the NMI issued a summons requiring the corporate representative of HONG KONG ENTERTAINMENT (OVERSEAS) INVESTMENTS, LTD. dba TINIAN DYNASTY HOTEL & CASINO to appear in court on May 3, 2013, at 9:00 a.m.

Kenneth J. Hines, Special Agent in Charge of IRS CI in the Pacific Northwest region said that, “Federal laws that regulate the reporting of financial transactions are in place to detect and stop illegal activities. IRS Criminal Investigation is committed to enforcing these laws and following the money, wherever it leads.”

“CTRs are important law enforcement tools for uncovering criminal activity. Individuals and financial institutions who seek to evade the federal reporting requirements will be pursued by the Department of Justice and its partners in federal law enforcement,” said U.S. Attorney Alicia A.G. Limtiaco.
The case is being investigated by IRS Criminal Investigation. The Federal Bureau of Investigation, the Drug Enforcement Administration, the United States Marshals Service, and Homeland Security Investigations assisted IRS CI in the execution of the search warrant. The United States Coast Guard assisted in transporting the federal agents from Saipan to the TINIAN DYNASTY HOTEL & CASINO.

A criminal complaint 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.

Complaint

Masood Chotani, a certified public accountant from Los Angeles , was sentenced today to 24 months in prison, followed by one year of supervised release, the Justice Department and Internal Revenue Service (IRS) announced. Chotani was also ordered to pay $60,705 in restitution to the IRS.

 

On June 23, 2010, Chotani was indicted by a federal grand jury on charges of engaging in a scheme to file false tax returns with the IRS using the names and Social Security numbers of deceased individuals. He pleaded guilty to conspiracy to defraud the United States on January 15, 2013.

According to the indictment and the plea agreement, in 2002 and 2003, Chotani misappropriated employer identification information from his client files and provided them to his co-conspirators, Haroon Amin and Ather Ali. Amin and Ali then prepared and filed fraudulent tax returns falsely stating that these deceased individuals earned wages from which income tax had been withheld. As part of the scheme, Chotani caused 47 tax returns to be filed with the IRS claiming an aggregate of $372,558 in false refunds. Although the IRS rejected the bulk of the refund claims filed in the scheme, a number of refund checks were issued and delivered to addresses controlled by Amin, Ali, and their co-conspirators, including various mailboxes opened by Ali. Most of these refund checks then were delivered overseas to be deposited in bank accounts in Armenia and Pakistan. Chotani admitted that he was a knowing participant in this scheme.

 

Amin and Ali are serving prison sentences of 30 and 37 months, respectively.

Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division, commended the efforts of agents from the IRS Criminal Investigation Division in Laguna Niguel, Calif., as well as Assistant U.S. Attorney Charles E. Pell and Tax Division Trial Attorneys Joseph A. Rillotta and Ignacio Perez de la Cruz, who prosecuted the case.

 

More information about the Tax Division and its enforcement efforts is available at www.usdoj.gov/tax .

Alicia A. G. Limtiaco, United States Attorney for the Districts of Guam and the Northern Mariana Islands (NMI), announced today that after a year of planning, the State and Local AntiTerrorism Training (SLATT) Program has finally come to the Marianas. With the assistance of the U.S. Attorney's Office for the Districts of Guam and the Northern Mariana Islands, the Guam Homeland Security/Office of Civil Defense, the Commonwealth of the Northern Mariana Islands Homeland Security and Emergency Management, and the U.S. Department of Justice's Bureau of Justice Assistance (BJA) Program, two instructors from the Institute for Intergovernmental Research (IIR) were on Guam April23 to 24, 2013, and will be in the NMI on April25 to 26,2013, to conduct the SLATT workshops to law enforcement, hotel and private security, military anti-terrorism personnel and other community leaders. Over 160 individuals attended the training in Guam and about 150 have registered to attend in Saipan.

U.S. Attorney General Eric Holder presented a special message addressing the SLATT participants and thanking them for their efforts to safeguard our communities in Guam and the NMI, and our nation.

"April is National Crime Victims' Rights Week. We observe a moment of silence for the victims of the Boston Marathon bombing and for all victims of terrorism, and their families; and for our Fallen Soldiers who through their commitment and sacrifice continue to protect the freedoms exercised by all Americans," stated U.S. Attorney Limtiaco.

U.S. Attorney Limtiaco further stated, "As part of our Secure Communities partnership with the U.S. Department of Homeland Security, the U.S. Attorney's Office has been collaborating with the U.S. Department of Justice Bureau of Justice Assistance Program and Institute for Intergovernmental Research, Guam Homeland Security/Office of Civil Defense, and Commonwealth ofthe Northern Mariana Islands (CNMI) Homeland Security and Emergency Management, to bring the State and Local Anti-Terrorism Training (SLATT) program to Guam and the CNMI. At this training, community partners have the opportunity to discuss domestic terrorism, international terrorism, indicators of terrorism, and the Suspicious Activity Community Program, which promotes law enforcement safety and de-confliction, and provides assistance to our federal, military and local law enforcement partners and the Marianas Regional
Fusion Center -- recently designated as the 781 h fusion center in the nation, in preventing, reducing and combating some of the most concerning threats to our national security."

"Since 9/11, there have been extraordinary and unprecedented efforts taken to keep America safe - including those by our own sons and daughters of the Pacific who serve in the military, as law enforcement, in the intelligence community, and as first responders. We also know that there is more work that must be done. Meeting these public safety and national security challenges of the 21st Century will require us to identify new enforcement strategies, to forge new partnerships, and to provide more support for our law enforcement communities. Our people in Guam and the Northern Mariana Islands, and our Pacific island neighbors are resilient. Terrorists aim to instill fear in our people, and to overturn our way of life. Just as earlier generations of Americans overcame great tests, so must we draw on the resilience of the American people to overcome the challenges of our time. Our communities are capable of withstanding whatever dangers may come. Today, threats from terrorists and extremists continue against our nation and the Asia-Pacific region. Our work against terrorism cannot be done without the continued involvement, leadership, vigilance and partnership of our community stakeholders," said U.S. Attorney Limtiaco.

U.S. Attorney Limtiaco gave special thanks to the Guam Homeland Security/Office of Civil Defense and the CNMI Homeland Security and Emergency Management for their assistance in planning the training and for securing the venues for this important training.

Attorney General Eric Holder today announced a revised version of the National Protocol for Sexual Assault Medical Forensic Examinations (SAFE Protocol, 2d.) The SAFE Protocol is a voluntary best practices guide to conducting sexual assault medical forensic examinations protocols.  These suggested practices will promote high-quality, sensitive, and supportive exams for all victims of rape and sexual assault.

The SAFE Protocol is based on the latest scientific evidence and provides recommendations to standardize the quality of care for sexual assault victims throughout the country.  By promoting thorough, sensitive evidence collection, the SAFE Protocol can improve the criminal justice response to rape and sexual assault to increase offender accountability. 

“The SAFE protocol is crucial to our efforts to end sexual violence,” said Attorney General Holder.  “It is our responsibility to ensure that victims feel comfortable coming forward. The SAFE Protocol helps us coordinate and improve our response when these courageous individuals do seek help from first responders including nurses, doctors, advocates, law enforcement, and prosecutors.”

In the nine years since the protocol was initially released in 2004, there have been substantial forensic medical advancements.  This revised edition of the protocol maintains the same commitments of standardization and quality as the first SAFE Protocol, but is updated to reflect current technology.  It also increases the emphasis on victim-centered care and includes additional information reflecting changes from the Violence Against Women Act of 2005.

Research shows that programs with trained examiners, such as Sexual Assault Nurse Examiners (SANEs) or Sexual Assault Forensic Examiners (SAFEs), using modern standards like those in the SAFE Protocol significantly increase evidence collection and investigation in sexual assault cases. Better evidence collection results in significantly higher prosecution rates, convictions, and guilty-pleas. The SAFE Protocol also helps SANEs and other medical professionals conduct exams that are sensitive, dignified, and reduce trauma.

“The SAFE Protocol helps ensure that victims will be cared for with compassion and respect when they turn to hospitals for help,” said Bea Hanson, Acting Director of the Office on Violence Against Women (OVW). “This not only improves outcomes for victims, it strengthens criminal cases. We are working to develop a comprehensive response to rape and sexual assault. One element of this is the President’s 2014 budget that includes $20 million to address the backlog of rape kits.”

The revised SAFE Protocol reflects the many important improvements that can help increase the quality of the services victims receive. The updated protocol has increased information on populations with special needs, such as victims with limited English proficiency; victims with disabilities; American Indian and Alaska Native victims; victims in the military; and lesbian, gay, bisexual or transgender victims.  It also has expanded information on topics such as drug and alcohol facilitated sexual assault, pregnancy, confidentiality and alternative reporting procedures.

The SAFE Protocol is not a requirement for any federal grant funding. Adherence to the protocol is not mandatory with the exception of the recently released Department of Defense Instruction on Sexual Assault Prevention and Response Program Procedures. In addition, to comply with the department’s National Standards to Prevent, Detect and Response to Prison Rape, correctional facilities that are responsible for investigating allegations of sexual abuse in their facilities must use a protocol that is adapted from or otherwise based on the SAFE Protocol or similarly comprehensive and authoritative protocols developed after 2011.

According to the Centers for Disease Control and Prevention, one in five women and one in 71 men have been raped in their lifetimes, and nearly 1.3 million women in the U.S. are raped every year.  More than one in four American Indian or Alaska Native women have been raped. Sexual assault and rape are pervasive crimes that threaten the safety of all communities. The SAFE Protocol is an important step forward in the Department of Justice’s efforts to end sexual violence.

OVW, a component of the U.S. Department of Justice, provides leadership in developing the nation’s capacity to reduce violence against women through the implementation of the Violence Against Women Act (VAWA) and subsequent legislation.  Created in 1995, OVW administers financial and technical assistance to communities across the country that are developing programs, policies and practices aimed at ending domestic violence, dating violence, sexual assault and stalking. In addition to overseeing 22 federal grant programs, OVW often undertakes initiatives in response to special needs identified by communities facing acute challenges. More information is available at www.ovw.usdoj.gov.

The SAFE Protocol is accessible at the National Criminal Justice Reference Service website at: www.ncjrs.gov/pdffiles1/ovw/241903.pdf.

An employee of Detroit medical service companies that fabricated patient visit notes and other documents as part of a $24 million home health care fraud scheme pleaded guilty today for her role in the conspiracy, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade, Special Agent in Charge Robert D. Foley III of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Chicago Regional Office.

Dana Sharma, 30, of Detroit, pleaded guilty before U.S. District Judge Denise Hood in the Eastern District of Michigan to one count of conspiracy to commit health care fraud. 

According to court documents, Sharma worked at purported home health companies, including First Choice Home Health Care Services Inc. and Reliance Home Care LLC, where she and other conspirators agreed to submit false and fraudulent claims to Medicare for home health services.  Court documents reveal that, among other things, Sharma organized and maintained company patient files, knowing that these files contained falsified patient visit notes that created the false impression that home health care had been provided to patients.  Sharma admitted that she knew that these documents would be used by these companies to submit claims to Medicare for home health services that were not medically necessary and/or not provided. 

Court documents allege that between January 2007 and May 2012, Sharma’s conduct caused home health companies to submit claims to Medicare for services that were not medically necessary and/or not provided, which in turn caused Medicare to pay these companies approximately $923,286.

At sentencing, scheduled for Aug. 1, 2013, Sharma faces a maximum penalty of 10 years in prison and a $250,000 fine.

This case is being prosecuted by Trial Attorney William G. Kanellis and Deputy Chief Gejaa Gobena of the Criminal Division’s Fraud Section.  It was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

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