District Not Recorded

Stephanie Charboneau, aka Stephanie Shankel, 34, of Fountain, Colo., formerly a Specialist in the United States Army, has been indicted in the District of Colorado for her alleged role in assisting the thefts of fuel in Afghanistan and laundering the proceeds of crime, Acting Assistant Attorney General Mythili Raman of the Criminal Division announced.    

According to the indictment returned on April 9, 2013, and now filed publicly, Charboneau was assigned to Forward Operating Base (FOB) Fenty, in eastern Afghanistan, as part of the 704th Brigade Support Battalion.  Her duties included overseeing the movement of fuel by private Afghan trucking companies from FOB Fenty to nearby military bases.  The indictment alleges that Charboneau conspired with Sergeant Christopher Weaver, her supervisor, and Jonathan Hightower, a civilian employee of FLUOR Inc., to facilitate the theft of fuel for money.  Charboneau and her co-conspirators allegedly received money from a representative of an Afghan trucking company to enable that company to steal truckloads of fuel.  The conspirators allegedly authorized the movement of truckloads of fuel from FOB Fenty – ostensibly to nearby bases – knowing and intending that when the fuel left FOB Fenty it would never reach the designated base and would instead be stolen.  These events occurred from approximately February 2010 through approximately May of 2010. 

In addition, the indictment charges that when Charboneau returned to the United States, she engaged in a series of transactions with the bribe proceeds to avoid the currency transaction reporting requirements.  Charboneau allegedly purchased an automobile for $33,179 in cash through a $5,000 down payment, two $9,900 cashier’s checks she funded but were in the name of two acquaintances, and an $8,379 cashier’s check in her name.

Charboneau was charged with conspiracy, bribery, theft, money laundering and structuring. If convicted, she faces penalties of 20 years in prison for money laundering, 15 for bribery, 10 for theft of government property, and five for conspiracy and structuring.  She also faces fines of $250,000 per count.

Weaver and Hightower have each pleaded guilty to a bribery conspiracy scheme and are awaiting sentencing.

This case was investigated by former Fraud Section Trial Attorney Mark Pletcher, who is currently an Assistant United States Attorney for the Southern District of California, and Special Trial Attorney Mark H. Dubester.  The case was investigated by the Special Inspector General for Afghanistan Reconstruction, the Department of the Army, Criminal Investigations Division, the Defense Criminal Investigative Service and the FBI Denver field office.

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

Kerry Michael Deevy pleaded guilty in U.S. District Court for the Southern District of Florida in Miami to 13 counts of an indictment pending against him, including one count of conspiracy to commit mail and wire fraud, three counts of mail fraud, and nine counts of wire fraud, the Justice Department and the U.S. Postal Inspection Service announced today.

Deevy, a Canadian citizen, was charged in connection with the operation of a series of fraudulent business opportunities. Deevy was arrested in Costa Rica in February 2012 following his indictment by a federal grand jury in Miami on Nov. 29, 2011. Following his arrest in Costa Rica, Deevy was extradited to the United States for prosecution. Deevy was arrested based on charges that he and his co-conspirators purported to sell vending machine and greeting card business opportunities, including assistance in establishing, maintaining and operating such businesses. The indictment is part of the government’s continued nationwide crackdown on business opportunity fraud.

In addition to Deevy, 11 other individuals have been charged in connection with business opportunity fraud ventures based in Costa Rica. Deevy is the ninth of those individuals to be convicted in the United States.

“The Department of Justice is committed to cracking down on financial fraud, including international telemarketing schemes,” said Stuart F. Delery, Acting Assistant Attorney General for the Justice Department’s Civil Division. “That is why we will continue to prosecute those who would deprive innocent, hardworking Americans of their hard-earned money by offering phony business opportunities.”

Beginning in 2006, Deevy and his coconspirators fraudulently induced purchasers in the United States to buy business opportunities in Cards-R-Us Inc., Premier Cards Inc. and Nation West Distribution Company. The business opportunities cost thousands of dollars each, and most purchasers paid at least $10,000.

Deevy participated in a conspiracy that used various means to make it appear to potential purchasers that the businesses were located entirely in the United States. In reality, Deevy operated out of Costa Rica to fraudulently induce potential purchasers in the United States to buy the purported business opportunities.

The companies made numerous false statements to potential purchasers of the business opportunities, including that purchasers would likely earn substantial profits; that prior purchasers of the business opportunities were earning substantial profits; that purchasers would sell a guaranteed minimum amount of merchandise, such as greeting cards; and that the business opportunity worked with locators familiar with the potential purchaser’s area who would secure or had already secured high-traffic locations for the potential purchaser’s merchandise stands.

The companies employed various types of sales representatives, including fronters, closers and references. A fronter spoke to potential purchasers when the prospective purchasers initially contacted the company in response to an advertisement. A closer subsequently spoke to potential purchasers to finalize deals. References spoke to potential purchasers about the financial success they purportedly had experienced since purchasing one of the business opportunities. The companies also employed locators, who were typically characterized by the sales representatives as third parties who worked with the companies to find high-traffic locations for the prospective purchaser's merchandise display racks.

Deevy, using aliases, was a fronter and reference for Cards-R-Us, Premier Cards and Nation West.

Each of the companies was registered as a corporation and rented office space to make it appear to potential purchasers that its operations were fully in the United States. Cards-R-Us was registered as a Nevada corporation and rented office space in Reno, Nev. Premier Cards was registered as a Colorado and Pennsylvania corporation and rented office space in Philadelphia. Nation West was a Colorado corporation and rented office space in Denver.

“Fraudsters must realize that financial fraud victimizing Americans will be prosecuted vigorously, even if the schemers conduct their fraudulent operations from abroad,” said Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida. “Increased international law enforcement cooperation eliminates safe havens for those who cheat American citizens from overseas.”

“ The success of this investigation shows that the U.S. Postal Inspection Service continues to work closely with the Department of Justice and our law enforcement partners, both foreign and domestically, to protect the American consumer from the predatory nature of business opportunity and telemarketing schemes ,” said Tony Gomez, Acting U.S. Postal Inspector in Charge in Miami.

Acting Assistant Attorney General Delery commended the investigative efforts of the Postal Inspection Service. The case is being prosecuted by Assistant Director Jeffrey Steger and trial attorney Alan Phelps with the U.S. Department of Justice Consumer Protection Branch.

 
The Department of Justice’s Antitrust Division today issued the 2013 edition of its annual newsletter on its website. The newsletter includes a message from Assistant Attorney General Bill Baer which focuses on the need to protect and promote competition in industries that directly affect the day-to-day lives of consumers, as well as articles about the Antitrust Division’s civil and criminal enforcement actions, international cooperation efforts and competition advocacy.

 
The newsletter highlights the division’s criminal enforcement matters, including the significant fines and prison sentences obtained and litigation victories in trials relating to the liquid crystal display, municipal bonds and coastal freight investigations. The division also achieved convictions in its auto parts, real estate foreclosure auctions and tax liens cartel investigations.

 
Other newsletter articles describe the division’s active civil enforcement program–as evidenced by the six civil cases currently in litigation–in key sectors such as health care, telecommunications and technology, transportation, office supplies and other consumer products.

The newsletter also features articles about some of the division’s talented career litigators, the division’s new economics deputy, and competition advocacy efforts involving public workshops on intellectual property and most favored nations clauses. 

 
The newsletter can be found at http://www.justice.gov/atr/public/division-update/2013/index.html . Within each article, hyperlinks are provided so that the reader can easily access relevant documents such as press releases, court filings and speeches. 

A member of the Internet piracy group “IMAGiNE” was sentenced today to serve 23 months in prison, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney for the Eastern District of Virginia Neil H. MacBride and Special Agent in Charge John P. Torres of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) in Washington, D.C.

Javier E. Ferrer, 41, of New Port Richey, Fla., was sentenced by Senior U.S. District Judge Henry C. Morgan in the Eastern District of Virginia. In addition to his prison term, Ferrer was sentenced to serve three years of supervised release and ordered to pay $15,000 in restitution.

On Nov. 29, 2012, Ferrer pleaded guilty to one count of conspiracy to commit criminal copyright infringement.  Ferrer is the fifth member of the IMAGiNE Group who has been sentenced to prison for the copyright conspiracy. 

On Sept. 13, 2012, Ferrer was charged in a criminal information for his role in the IMAGiNE Group, an organized online piracy ring that sought to become the premier group to first release Internet copies of movies only showing in theaters. Four other IMAGiNE Group members, including the group’s leader, were indicted on April 18, 2012, for their roles in the IMAGiNE Group. 

According to court documents, Ferrer and his co-conspirators sought to illegally obtain and disseminate digital copies of copyrighted motion pictures showing in theaters.  Ferrer actively participated in the IMAGiNE Group’s illegal efforts to film copyrighted motion pictures currently showing in theaters as his co-conspirators used receivers and recording devices to secretly capture audio sound tracks of copyrighted movies playing in movie theaters.  After the IMAGiNE Group obtained illegal copies of the audio and video portions of copyrighted motion pictures, Ferrer and his co-conspirators also engaged in processing or "encoding" the video files to enhance the picture quality and in synchronizing the audio files with the video files to make completed movies suitable for reproduction and distribution over the Internet, without the permission of the copyright owners. 

According to testimony by a representative of the Motion Picture Association of America, the IMAGiNE Group constituted the most prolific motion picture piracy release group operating on the Internet from September 2009 through September 2011.

Co-defendants Sean M. Lovelady, Willie O. Lambert, Gregory A. Cherwonik and Jeramiah B. Perkins pleaded guilty on May 9, June 22, July 11 and Aug. 29, 2012, respectively, to one count each of conspiracy to commit criminal copyright infringement, before U.S. District Judge Arenda L. Wright Allen in the Eastern District of Virginia . Lambert and Lovelady were sentenced on Nov. 2, 2012, to serve 30 months and 23 months in prison, respectively. Cherwonik was sentenced on Nov. 29, 2012, to serve 40 months in prison.  Perkins, the leader of the group, was sentenced on Jan. 3, 2013, to 60 months in prison.

The investigation of the case and the arrests were conducted by agents with the HIS Washington, D.C., Field Office. Assistant U.S. Attorney Robert J. Krask of the Eastern District of Virginia and Senior Counsel John H. Zacharia of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) are prosecuting the case. Significant assistance was provided by the CCIPS Cyber Crime Lab and the Criminal Division’s Office of International Affairs.

This case is part of efforts being undertaken by the Department of Justice Task Force on Intellectual Property (IP Task Force) to stop the theft of intellectual property. Attorney General Eric Holder created the IP Task Force to combat the growing number of domestic and international intellectual property crimes, protect the health and safety of American consumers, and safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation and hard work. The IP Task Force seeks to strengthen intellectual property rights protection through heightened criminal and civil enforcement, greater coordination among federal, state and local law enforcement partners, and increased focus on international enforcement efforts, including reinforcing relationships with key foreign partners and U.S. industry leaders. To learn more about the IP Task Force, go to www.justice.gov/dag/iptaskforce .

This investigation was supported by the HSI-led National Intellectual Property Rights Coordination Center (IPR Center) in Washington. The IPR Center is one of the U.S. government's key weapons in the fight against counterfeiting and piracy. Working in close coordination with the Department of Justice’s IP Task Force, the IPR Center uses the expertise of its 21-member agencies to share information, develop initiatives, coordinate enforcement actions and conduct investigations related to IP theft. Through this strategic interagency partnership, the IPR Center protects the public's health and safety, the U.S. economy and our war fighters.

The Department of Justice and the Federal Trade Commission (FTC) issued a joint summary of the activities of the Accountable Care Organization (ACO) Working Group, which took place between October 2011 and March 31, 2013. The department and the FTC established the working group to collaborate and discuss issues concerning ACOs created under the Affordable Care Act of 2010.  The act encourages physicians, hospitals and other health care providers to integrate their health care delivery systems in order to improve the quality and reduce the costs of health care services. 

The summary, which follows issuance of the agencies’ October 2011 antitrust enforcement policy statement regarding ACOs participating in the Medicare Shared Savings Program (MSSP), reports that during the time period covered, the ACO Working Group fielded 33 questions related principally to primary service area (PSA) share calculations, and two requests for voluntary expedited review from proposed ACOs.

Under the policy statement, an ACO may calculate its PSA shares to determine whether it falls within an antitrust safety zone for certain ACOs that are highly likely to raise significant competitive concerns. The ACO Working Group responded to most of the 33 PSA share questions within five business days, and in connection with the release of the summary is now making the questions and answers publicly available on their websites. The largest category of questions concerned obtaining and using Medicare and other data to calculate PSA shares.

Also under the policy statement, a newly formed ACO may request voluntary expedited antitrust review of its program. Both of the ACOs that sought such review during the time period covered by the summary withdrew their requests.

The joint summary and questions and answers can be found on the department’s website at www.justice.gov/atr/public/health_care/aco.html.

MEDIA CONTACT: Gina Talamona

Department of Justice

Office of Public Affairs

202-514-2007

Mitch Katz

FTC

Office of Public Affairs

202-326-2180

The Justice Department announced today that it has reached a settlement with Lee County, Fla. that, if approved by the district court, will resolve allegations that the county discriminated against three Hispanic employees on the basis of race and national origin in violation of Title VII of the Civil Rights Act of 1964, as amended.

The department’s complaint, previously filed in the Middle District of Florida, alleged that Lee County discriminated against Facilities Management Tradesworkers Leonides Sepulveda, Marco Ferreira, and Eduardo Rivera by subjecting them to racial and ethnic harassment. According to the complaint, from early 2007 through January 2009, the three employees were regularly subjected to racial and ethnic slurs by several of their co-workers. The discriminatory actions by co-workers included mocking Ferreira’s and Rivera’s accents, and making false accusations against Ferreira and Rivera to Lee County’s Office of Equal Opportunity in an effort to have the county terminate the two employees. The complaint further alleged that despite timely complaints about the harassment by the employees to their supervisors, as well as the supervisors’ direct observation of the harassment, Lee County failed to take any meaningful action to stop the harassment until January 2009, when the harassers were terminated. After the United States filed suit against Lee County, the three employees who were allegedly subjected to race and national original discrimination intervened in the lawsuit.

Under the terms of the settlement agreement, which must still be approved by the federal district court, the county is required to review and, if appropriate, revise its anti-discrimination policies for its workforce to protect its employees from discrimination. The county must also provide mandatory equal employment opportunity training to all Facilities Management employees that includes an emphasis on preventing race and national origin discrimination in the workplace. The settlement agreement also requires the county to pay the three affected employees $292,500 in monetary relief, including compensatory damages and attorney’s fees.

“Title VII ensures that employees have the right to work in an environment free of harassment based on their race and national origin,” said Jocelyn Samuels, Principal Deputy Assistant Attorney General for the Civil Rights Division. “This settlement demonstrates the Civil Rights Division’s commitment to eradicate discriminatory harassment from the workplace.”

The continued enforcement of Title VII has been and remains a 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.usdoj.gov/crt/ .

The United States has filed a civil injunction lawsuit seeking to shut down Mo’ Money Taxes, a Memphis, Tenn., based tax-preparation chain that at one time operated as many as 300 offices in 18 states, the Justice Department announced today. The United States accuses Mo’ Money Taxes and its owners, Markey Granberry and Derrick Robinson, and store manager Eumora Reese of creating and maintaining a business environment that encourages the preparation of fraudulent federal income tax returns.

The government suit alleges that the defendants promote a culture that favors volume and profits over accuracy and integrity, and creates an environment where fraudulent return preparation and tax-law violations flourish. According to the complaint, Mo’ Money Taxes’ managers, licensees and employees prepare fraudulent returns that cause their customers to incorrectly report their federal tax liabilities and underpay their taxes and charge customers bogus and unconscionably high fees.

The complaint alleges that the defendants style themselves as savvy marketers and promoters of the Mo’ Money Taxes brand and image – as evidenced by their commercials – and that Granberry and Robinson decided to change the business’s name following bad publicity in 2012 surrounding customer allegations that Mo’ Money Taxes failed to provide tax refunds to customers in a reasonable amount of time, if at all. According to the complaint, Granberry and Robinson now do business under the name Marquis Taxes and, along with Reese, under the name Southern King Taxes.

According to the complaint, the defendants encourage Mo’ Money preparers to

·          Falsely claim the earned-income credit;

·          Claim improper filing status;

·          Claim bogus education credits;

·          Improperly prepare returns using paystubs rather than employer-issued W-2 forms;

·          Fabricate bogus W-2 forms;

·          File tax returns without customers’ consent;

·          Sell false and deceptive loan products; and

·          Charge deceptive and unconscionable fees.

The complaint cites alleged examples of Mo’ Money Taxes customers in Memphis; Atlanta; Richmond, Va.; Jackson, Miss.; and Nashville, Tenn., whose returns had such fraudulent claims. The complaint also refers to several state-government actions related to Mo’ Money Taxes’ sale of refund-anticipation loans and charging of undisclosed or improper fees.

The complaint alleges that the estimated tax loss from fraudulent tax return preparation at Mo’ Money Taxes offices in Memphis, Atlanta, Richmond and Jackson in 2011 exceeds $9 million.

Return preparer fraud, claiming false income or expenses to secure larger refundable credits such as the earned-income credit, and identity theft are among the IRS’s “ Dirty Dozen ” Tax Scams for 2013.

“The nation’s tax system relies on the integrity of tax preparers,” said Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division. “Most tax preparers are honest. We owe it to them and to all American taxpayers to use appropriate law enforcement tools to stop those who prepare fraudulent tax returns or who lure customers with deceptive loan products.”

“Americans understand that the timely and equitable collection of tax revenues is essential to ensuring the financial security of our citizens and nation as a whole,” said Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee.  “Those who abuse the tax filing process by fraudulently diverting public revenues into their own pockets are essentially stealing from every American and should expect to be held accountable to the fullest extent of the law.”

The United States previously obtained a permanent injunction against Toney Fields and Trumekia Shaw, who operated a Mo’ Money Taxes location in Nashville.

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. Markey Granberry, et al.
Complaint for Permanent Injunction and Other Relief (PDF)

Thirty-four individuals and 23 entities have been indicted and accused of operating an illegal sports bookmaking business that solicited more than $1 billion in illegal bets, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney for the Western District of Oklahoma Sanford C. Coats.

“These defendants allegedly participated in an illegal sports gambling business, lining their pockets with profits from over a billion dollars in illegal gambling proceeds,” said Acting Assistant Attorney General Raman. “Today’s charges demonstrate that we are as determined as ever to hold accountable those involved in facilitating illegal online gambling by U.S. citizens, regardless of where the business operates, or where the defendants reside.”

“The defendants cannot hide the allegedly illegal sports gambling operation behind corporate veils or state and international boundaries,” said U.S. Attorney Sanford C. Coats.  “I thank the IRS and FBI for their diligent work over several years to investigate this billion dollar international gambling enterprise.”

According to the indictment, Bartice Alan King, aka “Luke” and “Cool,” 42, of Spring, Texas, conspired with others to operate internet and telephone gambling services first from San Jose, Costa Rica and then from Panama City, which took wagers almost exclusively from gamblers in the United States seeking to place bets on sports. Known since 2003 as Legendz Sports, the enterprise allegedly used bookies located in the United States to illegally solicit and accept sports wagers as well as settle gambling debts.

The 34 defendants are alleged to have been employees, members and associates of the ongoing Legendz Sports enterprise.  The 23 corporate defendants are alleged to have been used by Legendz Sports to facilitate gambling operations, operate as payment processors, own websites and domain names used in the enterprise, launder gambling funds and make payouts to gamblers.

The indictment alleges that Legendz Sports sought to maximize the number of gamblers who opened wagering accounts by offering both “post-up” betting, which requires a bettor to first set up and fund an account before placing bets and “credit” betting, which allowed the bettor to place a wager without depositing money in advance through face-to-face meetings with bookies or agents.

The indictment alleges that Legendz Sports solicited millions of illegal bets totaling over $1 billion.

“These defendants allegedly participated in an illegal sports gambling business, lining their pockets with profits from over a billion dollars in illegal gambling proceeds,” said Acting Assistant Attorney General Raman. “Today’s charges demonstrate that we are as determined as ever to hold accountable those involved in facilitating illegal online gambling by U.S. citizens, regardless of where the business operates, or where the defendants reside.”

“The defendants cannot hide the allegedly illegal sports gambling operation behind corporate veils or state and international boundaries,” said U.S. Attorney Sanford C. Coats.  “I thank the IRS and FBI for their diligent work over several years to investigate this billion dollar international gambling enterprise.”

“Individuals cannot skirt the laws of the United States by setting up illegal internet gambling operations in a foreign country, while living in the United States and enjoying all the benefits of U.S. citizens,” said Jim Finch, Special Agent in Charge of the FBI Oklahoma City Field Office.  “The FBI, along with our law enforcement partners, will continue to be diligent in investigating such violations of federal law.”

“Combining the financial investigative expertise of the IRS with the skills and resources of the FBI makes a formidable team for combating major, greed-driven crimes,” said Andrea D. Whelan, Internal Revenue Service Special Agent in Charge.  “This massive indictment is the result of our highly effective law enforcement partnership.”

If convicted, the defendants face up to 20 years in prison for racketeering, up to 20 years in prison for conspiring to commit money laundering, up to 10 years in prison for money laundering and up to five years in prison for operating an illegal gambling business.

In addition, the indictment seeks a forfeiture money judgment of at least $1 billion traceable to numerous specific assets that include real estate, bank accounts, brokerage and investment accounts, certificates of deposit, individual retirement accounts, domain names, a Sabreliner aircraft, a gas lease and vehicles.

The public is reminded that the indictment is merely an accusation and that the defendants are each presumed innocent unless and until proven guilty.
This case is the result of an investigation by the FBI and Internal Revenue Service-Criminal Investigation, with the assistance of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the U.S. Marshals Service.  The case is being prosecuted by Assistant U.S. Attorneys Susan Dickerson Cox and William Lee Borden Jr., from the Western District of Oklahoma and Trial Attorney John S. Han with the Department of Justice Criminal Division Organized Crime and Gang Section.

For further information, reference is made to the 95-page indictment which can be found at www.justice.gov/usao/okw/index.html.

A federal court in Baton Rouge, La. permanently barred Ann Williams and her tax preparation firm, Ann’s Tax Service, from preparing federal tax returns for others, the Justice Department announced today. The civil injunction order, to which Williams and Ann’s Tax Service agreed without admitting the allegations against them, was signed by Judge James J. Brady of the U.S. District Court for the Middle District of Louisiana.

The government complaint alleged that Williams and her business had repeatedly prepared false federal income tax returns that understated customers’ tax liabilities. According to the complaint, Williams inflated or fabricated business expenses, reported fictitious business income, and fraudulently claimed the earned-income credit on customers’ tax returns. The government suit alleges that Williams’s fraudulent practices may have resulted in as much as $2.2 million in lost tax revenue. The U.S. Attorney’s Office of the Middle District of Louisiana assisted in the filing of this lawsuit by acting as local counsel.

The IRS lists return-preparer fraud as one of the Dirty Dozen Tax Scams for 2013. In the past decade, the Justice Department’s Tax Division has obtained injunctions against hundreds of tax fraud promoters and unscrupulous tax preparers. Information about these cases is available on the Justice Department website.

Related Materials:

 United States v. Ann M. Williams , etc.
Complaint for Permanent Injunction (PDF)
Order of Permanent Injunction (PDF)
 

Attorney General Eric Holder announced today that President Obama’s FY 2014 Budget proposal totaling $27.6 billion for the Department of Justice identifies over $561.4 million in efficiencies, savings and rescissions while providing resources to increase critical national security programs, and uphold the department’s traditional missions with an increased focus on gun safety, cyber security, financial and mortgage fraud, immigration laws, civil rights, prisons and detention capacity, and assistance for our state, local and tribal law enforcement partners. Although sequestration cut over $1.6 billion from the department’s budget in FY 2013 and creates countless operational challenges, the President’s budget replaces and repeals joint committee enforcement and provides for the department’s key priorities. The request represents a 3 percent increase in budget authority from the FY 2012 enacted level.

“The President’s budget request reflects a strong commitment to building upon the record of progress we have established in fulfilling the Justice Department’s most critical missions.  The proposed budget will provide the department with the resources necessary to protect the American people from terrorism and other national security threats; to prevent and respond to violent crime; to enforce the civil rights to which everyone in this country is entitled; to protect the most vulnerable among us; to combat financial and mortgage fraud; and to work alongside key state, local and tribal law enforcement partners in achieving the goals we share,” said Attorney General Holder.  “As in previous years, this budget incorporates department-wide savings and efficiencies, but the need for a balanced, bipartisan deficit reduction plan remains an urgent priority.  And it is imperative that we eliminate current fiscal uncertainty and ensure that these critical enhancements can be implemented.” 

The $27.6 billion budget request includes investments for critical administration priorities, including $4.4 billion to sustain the department’s critical national security mission; $395.1 million to combat gun violence; $92.6 million to increase funding for enforcement of cyber security; $55 million to investigate and prosecute financial and mortgage crimes; $25 million increase to address the growing immigration caseload; $7.5 million increase to prevent human trafficking, hate crimes and police misconduct; and $236.2 million to ensure prisoners and detainees are securely confined. The budget addresses the federal prison population by allowing eligible inmates to earn sentence reductions for good behavior and participation in certain reentry programs, freeing up federal prison space and reducing long-term costs. Finally, the budget continues to foster valued partnerships through state, local and tribal assistance to enhance public safety, protect women and children, and reduce recidivism.

The Department of Justice’s key priorities include:

·          $4.4 billion for national security;

·          $395.1 million to protect Americans from gun violence;

·          $92.6 million enhancement for cyber security;

·          $55 million increase for investigating and prosecuting financial and mortgage fraud;

·          $25 million increase to support immigration laws;

·          $258.6 million to help meet the Nation’s civil rights challenges;

·          $236.2 million investment for federal prisons and detention;

·          $2.3 billion – a net increase of $201.3 million – to maintain assistance to state, local and tribal law enforcement; and

·          $561.4 million in federal program offsets and rescissions (includes $236.8 million in efficiencies, savings and offsets and $324.6 in one-time balance rescissions).  

National Security

Defending our nation’s security from both internal and external threats remains the Department of Justice’s highest priority. The FY 2014 budget request provides a total of $4.4 billion to maintain critical counterterrorism and counterintelligence programs and sustain recent increases for intelligence gathering and surveillance capabilities.

The Administration supports critical national security programs within the Department, including those led by the FBI and the National Security Division (NSD). In FY 2012, the FBI dedicated approximately 4,200 agents to investigate more than 33,000 national security cases. NSD has continued to carry out its primary functions to prevent acts of terrorism and espionage in the United States and to facilitate the collection of information regarding the activities of foreign agents and powers.

In FY 2014, the department is investing $14 million to improve intelligence coordination and collection, expand information sharing efforts, and strengthen investigations of national security efforts in order to protect the nation and secure the homeland.

For more information, view the National Security Fact Sheet at www.justice.gov/jmd/2014factsheets/

Gun Safety

Gun violence has touched every state, county, city, and town in America.  The President laid out a comprehensive plan to reduce gun violence and save lives. As part of this effort, the department’s FY 2014 request of $395.1 million, including $173.1 million invested in federal programs and a total of $222 million in grant programs, provides additional resources to combat gun violence and improve the process used to ensure that those prohibited from purchasing or owning guns are kept from doing so. Funding increases are also provided to improve criminal history records information; initiate a new Comprehensive School Safety Program; provide active shooter response training to state and local law enforcement officers, first responders and school officials; and enhance the enforcement of existing gun laws.

Specifically, the request strengthens the national background check system by investing $100 million to double the existing transaction capacity of the FBI’s National Instant Criminal Background Check System (NICS). This is vital to ensure the NICS system can support a Universal Background Check requirement. We are also taking a thorough look at our federal laws and our enforcement priorities to ensure that we are doing everything possible at the federal level to keep firearms away from traffickers and others prohibited by law from possessing firearms.  As directed by the President, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) has recently published guidance to federal agencies on how to trace recovered firearms and requests $51.1 million to support additional investigative and regulatory resources as well as improvements to ATF’s tracing system.  The department is also requesting $22 million to enhance the National Integrated Ballistics Information Network and better support law enforcement’s ability to connect incidents of criminal firearms use.

And while most of the Department’s efforts will be focused on keeping guns out of the wrong hands, we also want to help those on the ground prevent and mitigate violent situations when they do occur.  To this end, t he grant program request includes $55 million to improve the submission of state criminal and mental health records to NICS; $150 million to develop and improve school safety plans and enable states to hire additional school resource officers and to purchase school security equipment. It will further provide $2 million to encourage the development of innovative gun safety technology and $15 million for the VALOR Initiative, including training for active shooter situations.

For more information, view Gun Safety Fact Sheet at www.justice.gov/jmd/2014factsheets/

Cyber Security

Investigating cybercrime and protecting our nation’s critical network infrastructure is a top priority of the department in an era when cyber-attacks and crimes are increasingly common, sophisticated, and dangerous. The President’s FY 2014 budget request maintains recent increases for the FBI’s cyber terrorism investigations, the National Cyber Investigative Joint Task Force (NCIJTF) and the forensic examination of digital evidence by expanding funds to support the Next Generation Cyber Initiative and capabilities to combat cyber threats from individuals, organized groups, and rogue actors.

The department has a unique and critical role in cyber security that emphasizes domestic mitigation of threats and involves countering these threats by investigating and prosecuting intrusion cases, gathering intelligence, and providing legal and policy support to other departments. The department is also responsible for establishing effective internal network defense and serving as a model for other departments and agencies.

The department is committed to carrying out its role consistent with the Administration’s Executive Order on Improving Critical Infrastructure Cyber Security which emphasizes intelligence and information sharing as well as the preservation of privacy, data confidentiality, and civil liberties. As part of this effort, the department continues to maintain and strengthen its cyber security environment to counter cyber threats, including insider threats, and to ensure personnel have unimpeded access to the IT systems, networks, and data necessary to achieve their missions. In FY 2014, the department is requesting $92.6 million to support efforts to combat and keep pace with increasingly sophisticated and rapidly evolving cyber threats.

For more information, view the Cyber Security Fact Sheet at www.justice.gov/jmd/2014factsheets/

Financial Fraud Law Enforcement

Investigating and prosecuting financial fraud continues to be a priority for the Obama Administration. The Justice Department is proposing a program increase of $55 million for financial and mortgage fraud initiatives to complement ongoing efforts to combat financial and health care fraud, that are supported by existing direct resources and reimbursable funding.

Continuing efforts already underway, the FY 2014 budget requests resources to strengthen the department’s ability to pursue large-scale financial fraud investigations ensuring that Americans, their investments and our financial markets are protected. The department remains committed to efforts to help restore confidence in our financial markets, protecting the federal Treasury and defending the interests of the U.S. government.

Ongoing efforts by the President’s Financial Fraud Enforcement Task Force (FFETF) are included in the department’s requests for program increases for a variety of financial fraud enforcement efforts. This increase will support additional FBI agents, criminal prosecutors, civil litigators, investigators, forensic accountants and other support positions. The additional resources will sustain the department’s investigation and prosecution of securities and commodities fraud, investment scams and mortgage foreclosure schemes and a broad range of financial crimes, including cases being investigated and brought by the FFETF’s Residential Mortgage-Backed Securities Working Group.

For more information, view the Financial and Mortgage Fraud Fact Sheet at www.justice.gov/jmd/2014factsheets/ .

Immigration

The department maintains substantial responsibilities with respect to immigration, including enforcement, detention, judicial functions, administrative hearings, and litigation. The department’s Executive Office for Immigration Review (EOIR) maintains a nationwide presence overseeing the immigration court and appeals process. EOIR receives cases directly from the Department of Homeland Security (DHS) enforcement personnel. Combined with the Civil Division’s Office of Immigration Litigation, the department has a wide and important role in immigration enforcement.

However, in recent years, the department’s resource enhancements have not kept pace with immigration enforcement efforts, thereby undermining the effectiveness and efficiency of overall immigration enforcement, adjudication and detention programs. For example, EOIR’s immigration court caseload has continued to outpace department resources increasing by 42 percent, from 229,000 to 326,000, between FY 2009 and FY 2012.

The 2014 request includes a $25 million investment to support an additional 30 Immigration Judge Teams and 15 Board of Immigration Appeals attorneys. This will allow EOIR to address caseload increases emanating from DHS programs, including the Secure Communities Initiative and the Criminal Alien Program. Additional funding is included to enable EOIR to create a pilot program that provides counsel to vulnerable populations, such as unaccompanied alien children, and to expand their Legal Orientation Program that improves efficiencies in immigration court proceedings for detained aliens.

For more information, view the Immigration Fact Sheet at www.justice.gov/jmd/2014factsheets/

Civil Rights

It is the mission of the department to uphold the civil and constitutional rights of all Americans, particularly the most vulnerable members of our society. Accomplishing this requires necessary resources both to investigate and to litigate. The department maintains substantial responsibilities with respect to enforcing the nation’s civil rights laws and protecting vulnerable populations. The FY 2014 budget will support the department’s vigorous enforcement of federal civil rights laws – including human trafficking, hate crimes, police misconduct, fair housing, fair lending, disability rights, and voting. As such, the department’s FY 2014 budget requests $258.6 million to help meet the nation’s civil rights challenges. The request includes $7.5 million in program increases for the Civil Rights Division and Community Relations Service.

For more information, view the Civil Rights Fact Sheet at www.justice.gov/jmd/2014factsheets/.

Prisons and Detention

The department has made strategic investments in law enforcement initiatives that have improved the nation’s security and made communities safer. The result of these important enforcement efforts has been an expansion in the need for prison and detention capacity. The department continues to prioritize the maintenance of secure, controlled detention and prison facilities, as well as investment in programs that can reduce recidivism. The FY 2014 budget requests a total of $8.5 billion for prisons and detention. The request invests in prisons and detention capacity, providing $236.2 million for program increases to maintain current services, improve prisoner reentry and ensure prisoners are confined in secure facilities.

For the Federal Bureau of Prisons (BOP), the budget includes resources to begin activation of three prisons – FCI Hazelton, W.Va., U.S. Penitentiary Yazoo City, Miss., and Administrative Maximum U.S. Penitentiary Thomson, Ill. – and full activation for two prisons that received partial funding in FY 2012 – Federal Corrections Institution (FCI) Aliceville, Ala., and FCI Berlin, N.H. These resources will increase federal prison capacity and address overcrowding and related security issues.

Additionally, the request provides funds for renovation of the Thomson Correctional Center, additional contract beds, and plans to expand the residential drug abuse treatment program, Residential Reentry Centers, and reentry-specific education programs. These resources provide critical opportunities for inmates to successfully transition back into the community, resulting in fewer taxpayer resources directed at housing inmates.

For more information, view the Prisons and Detention Fact Sheet at www.justice.gov/jmd/2014factsheets/

State, Local and Tribal Law Enforcement

In total, the FY 2014 budget requests $2.3 billion for state, local and tribal law enforcement assistance. These funds will allow the department to continue to support our state, local and tribal partners who fight violent crime, combat violence against women and support victim programs.  The FY 2014 request will bolster the department’s efforts to ensure that federal grant funding flows to evidence-based purposes and helps to advance knowledge of what works in state and local criminal justice.

The request increases funding for an evaluation clearinghouse; enhances funding for evidence-based competitive programs; and couples formula grant programs with competitive “bonus” funds to incentivize better, evidence-based, uses of funds. The request also includes funding to address school safety and gun violence with additional resources to improve criminal history records information and to fund a comprehensive school safety program.

The FY 2014 budget request for the Office on Violence Against Women (OVW), a total of $412.5 million, will provide communities with the opportunity to combat sexual assault and violence against women. The request includes an increase of $3.5 million to the Rural Domestic Violence and Child Abuse Enforcement Assistance Program, which will improve the safety of children, youth and adults who are victims of domestic violence, dating violence, sexual assault and stalking by supporting projects uniquely designed to address and prevent these crimes in rural jurisdictions.  The department is requesting $1.5 billion for the Office of Justice Programs’ (OJP) grant programs to expand established programs that have shown to be successful, such as the Residential Substance Abuse Treatment, Second Chance and Byrne Criminal Justice Innovation Programs. It also proposes to create new competitive grant programs that are structured on evidence-based principles and funding to establish programs that will provide supplementary awards to states and localities using base formula grant funds for evidence-based purposes. The OJP request also includes additional funding to address gun violence, including funding for a gun safety research initiative and enhanced funding for the National Criminal History Improvement Program and the VALOR Initiative.

For more information, view the State, Local and Tribal Law Enforcement Fact Sheet at www.justice.gov/jmd/2014factsheets/ .

Eric Majette, 52, a tax return preparer and owner and operator of the Berrisford Group, located in Somerville, N.J., pleaded guilty today to corruptly endeavoring to obstruct and impede the Internal Revenue laws and to preparing a false tax return, the Justice Department and Internal Revenue Service (IRS) announced.

On Jan. 17, 2013, a federal grand jury sitting in Trenton, N.J., returned a superseding indictment, charging Eric Majette with twenty-nine counts of aiding and assisting in the preparation of false tax returns for clients and one count of corruptly endeavoring to obstruct and impede the Internal Revenue laws. According to the superseding indictment, Majette prepared false tax returns for clients by inflating itemized deductions and credits such as charitable contributions, unreimbursed employee expenses, and energy credits. In addition, when his clients were audited, Majette submitted false charitable contribution receipts to the IRS to support the fraudulent returns that he prepared.

Sentencing has been scheduled for Sept. 24, 2013. The case was investigated by special agents of IRS - Criminal Investigation. Trial Attorneys Tino M. Lisella and Robert C. Kennedy of the Justice Department’s Tax Division are prosecuting the case.

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

The Department of Justice announced today that it has entered into a consent decree with the city of Millbrook, Ala., that, if approved by the U.S. District Court for the Middle District of Alabama, will resolve the department’s complaint alleging sex discrimination and retaliation in violation of Title VII of the Civil Rights Act of 1964, as amended. The complaint, which was filed along with a proposed consent decree, alleges that Millbrook discriminated against Kristen Spraggins, a female officer employed by the Millbrook Police Department, by subjecting her to harassment and disparate treatment based on her sex, and then terminating her in retaliation for her opposition to the discrimination.

Spraggins began employment with Millbrook as patrol officer in January 2008 and, at the time, was Millbrook’s only female police officer. According to the complaint, Spraggins received excellent performance evaluations from her superiors in the Millbrook Police Department until she rejected unwanted sexual advances by a co-worker and reported those advances to her superiors. The complaint alleges that Millbrook violated Title VII by failing to take effective disciplinary action against the co-worker who harassed her, a male sergeant, and instead subjecting Spraggins to unwarranted disciplinary actions. The complaint further alleges that Millbrook eventually terminated Spraggins from employment with the Police Department in retaliation for her pursuing internal complaints with the department about the sexual harassment and because she filed a charge of sex discrimination with the Equal Employment Opportunity Commission. Under the terms of the consent decree, Millbrook must pay Spraggins compensatory damages as part of the settlement with the department. The consent decree also provides for injunctive relief requiring Millbrook to revise and enforce its policies and procedures that prohibit sex discrimination and retaliation, and to train its officers and other employees on the prevention of sex discrimination and retaliation.

“The Justice Department is committed to the vigorous enforcement of all federal civil rights laws under its jurisdiction, including Title VII’s prohibition against harassment and retaliation in the workplace,” said Jocelyn Samuels, Principal Deputy Assistant Attorney General of the Civil Rights Division. “This lawsuit should send a clear message that the Department will take necessary action to eliminate and remedy the effects of unlawful harassment in our public sector workplaces.”

The enforcement of Title VII and other federal employment discrimination laws is a top priority of the Justice Department’s Civil Rights Division.  Additional information about the Civil Rights Division and its work is available on its website at www.justice.gov/crt.

The Justice Department today reached an agreement with Milestone Management Company, a nationwide residential property management firm headquartered in Dallas, resolving claims that the staffing company violated the anti-discrimination provision of the Immigration and Nationality Act (INA).

In a charge filed with the department, a lawful permanent resident alleged that after working for Milestone for three years, the company improperly demanded that he produce an unexpired lawful permanent resident card, despite the fact that he had presented proper work authorization documentation at the time of hire. The company discharged the worker when he was unable to present the document. The department’s investigation revealed that Milestone had also improperly reverified the documentation of other lawful permanent residents when their documentation expired and that it did not reverify expired documentation of U.S. citizens. The anti-discrimination provision generally prohibits treating employees differently in the employment eligibility verification and reverification processes based on citizenship or national origin unless required by law.

In response to the Justice Department’s investigation, Milestone immediately reinstated the charging party and provided full backpay for his six weeks of lost wages. Milestone cooperated with the department’s requests for information regarding its employment authorization verification processes throughout the investigation, and took proactive steps in collaboration with the department to provide corrective training for Milestone employees before the investigation had been concluded.

Under the terms of the agreement, Milestone agreed to pay $20,000 in civil penalties to the United States, undergo Justice Department training on the anti-discrimination provision of the INA and be subject to monitoring of its employment eligibility verification practices for a period of three years. The case settled prior to the Justice Department filing a complaint in this matter.

“We commend Milestone’s full cooperation with the Department’s investigation of this matter, and its proactive efforts to ensure that all of its employees responsible for completing Form I-9 are fully aware of their obligations under the INA’s antidiscrimination provisions,” said Gregory B. Friel, Deputy Assistant Attorney General for the Civil Rights Division. 

The Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) is responsible for enforcing the anti-discrimination provision of the INA.   For more information about protections against employment discrimination under the immigration laws, call the OSC’s worker hotline at 1-800-255-7688 (1-800-237-2525, TDD for hearing impaired), call the OSC’s employer hotline at 1-800-255-8155 (1-800-362-2735, TDD for hearing impaired), sign up for a no-cost webinar at www.justice.gov/about/osc/webinars.php , email osccrt@usdoj.gov or visit the website at www.justice.gov/crt/about/osc.

WASHINGTON – With the annual tax filing deadline approaching on April 15, the Justice Department today announced highlights of its work during the past year to defend and enforce the nation’s tax laws. The Tax Division has worked together with the Internal Revenue Service (IRS) to carry out their combined tax enforcement missions in several critical areas, including prosecuting tax fraud and evasion, halting the spread of abusive tax shelters, tracking down tax cheats who use offshore accounts, and combating stolen identity refund fraud. Previously, the division announced that it has shut down more than 30 fraudulent tax preparers over the past six months.

The Tax Division’s primary purpose is to enforce the nation’s tax laws fully, fairly, and consistently, through both criminal and civil litigation. Some of the division’s accomplishments from the past fiscal year (FY 2012) include:

· Favorable outcomes were achieved in over 95 percent of all civil and criminal cases litigated by the Tax Division.

· The division authorized 938 grand jury investigations and 1,751 prosecutions of individual defendants.

· Division prosecutors obtained 127 indictments and 137 convictions. Those figures do not include additional criminal tax prosecutions handled exclusively by U.S. Attorney’s Offices nationwide.

· The division collected over $290 million through affirmative civil litigation and retained over $1.1 billion through defensive tax refund and other litigation.

· Taking into account the tax dollars collected and refunds not paid as a result of our successful litigation efforts, over the past five fiscal years (FY 2008-2012), the division’s attorneys have returned to the Federal Treasury an average of $14 for each dollar invested.

“As honest taxpayers prepare to meet their filing obligations by April 15, they should know that we are committed to enforcing the tax laws against those who would cheat on their responsibilities,” said Assistant Attorney General Kathryn Keneally. “The department will continue to use all available law enforcement tools to recover tax revenue and to punish tax offenders.”

“The IRS and Department of Justice have made significant strides in recent months to combat tax fraud, identity theft, and offshore tax evasion,” said IRS Acting Commissioner Steven T. Miller. “We appreciate the Justice Department’s strong support and cooperation to protect the interests of the nation’s taxpayers.”

Prosecuting Tax Offenses

The Tax Division has supervisory authority over all criminal conduct involving federal tax laws. The Division has always maintained as a central focus the investigation and prosecution of tax crimes, including tax evasion, failure to file returns, submission of false tax returns, and other conduct designed to violate federal tax laws. Tax Division attorneys are also particularly adept at prosecuting tax defiers—those individuals who purposefully refuse to comply with the tax laws and use frivolous arguments to support their positions.

Some of the Tax Division’s criminal tax prosecution highlights from the past year include:

· April 2013 - Jeffrey Charles of Grimstead, Va., was sentenced to 46 months in prison and ordered to pay $300,000 in restitution for conspiracy, aiding and assisting in the preparation of false tax returns, and filing a false tax return.

· March 2013 - Tyrone Thompson, a Georgia tax return preparer, was sentenced to 137 months in prison and ordered to pay $516,363 in restitution for conspiracy and filing fraudulent tax returns in order to receive tax refunds to which he was not entitled.

· March 2013 - Timothy Turner, the self-proclaimed “president” of the so-called sovereign citizen group “Republic for the United States of America” (RuSA), was found guilty of conspiracy to defraud the United States, attempting to pay taxes with fictitious financial instruments, attempting to obstruct and impede the IRS, failing to file a 2009 federal income tax return, and falsely testifying under oath.

· January 2013 - Michael Wayne Davis, II, of Raleigh, N.C., formerly of Eagle, Idaho, was sentenced to 51 months in prison and ordered to pay nearly $1 million in restitution for wire fraud and filing a false tax return. Davis formerly owned Xpress Flex Inc., a Boise-based company that administered employee-benefit plans, and Payroll America, a Boise payroll services company.

· October 2012 - James Norman Turek, former president of a Lexington, Ky., based company, was sentenced to 18 years in prison for securities fraud and tax fraud. The evidence showed that Turek, through his company, Plasticon International Inc., defrauded thousands of investors nationwide out of more than $18 million, and that he filed false tax returns by failing to report approximately $12 million.

· June 2012 - Richard Stewart of Mitchellville, Md., was sentenced to 24 months in prison and ordered to pay $5,414,647 in restitution for failing to pay over employment taxes in connection with his ownership of Montgomery Mechanical Services.

Halting the Spread of Tax Shelters

The Tax Division plays a critical role in the government's efforts to combat abusive tax shelters.These cases involve more than a billion dollars in tax revenue, and affect billions more owed by other taxpayers.In recent years, the division’s civil litigators at both the trial and appellate levels have won important victories in cases involving tax shelters with names such as Son of BOSS, BLIPS, CARDS, DAD and SILO/LILO.

Some of the division’s successes this year include:

· February 2013 - the division prevailed in a tax shelter case involving $1 billion in phony tax deductions claimed by a major U.S. corporation as a result of two abusive tax shelter transactions. In United States v. Chemtech Royalty Associates, L.P., the federal district court in Baton Rouge, La., following a lengthy trial, determined that the shelter transactions lacked economic substance and that the partnership at issue should be disregarded because it had no purpose other than to create tax benefits. In addition to rejecting the purported tax benefits from these transactions, the court also imposed penalties.

· February 2013 - the division’s appellate section successfully defended a favorable Tax Court ruling in Crispin v. Commissioner, a case involving the CARDS tax shelter. The Third Circuit Court of Appeals upheld both the denial of the claimed tax benefits and the imposition of a 40 percent gross-valuation-misstatement penalty.

· January 2013 - the division’s appellate section secured a reversal of the lone trial court decision that had upheld the purported tax benefits generated by the “lease-in/lease-out” (LILO) tax shelter, in Consolidated Edison Co. v. United States, a case decided by the Federal Circuit.

Investigating Offshore Evasion

The Tax Division continues to play a leading role in investigations and prosecutions involving the use of foreign tax havens. According to a 2008 Senate report, the use of secret offshore accounts to evade U.S. taxes costs the Treasury at least $100 billion annually. The Division is committed to investigating offshore tax evasion around the globe. The division’s current offshore program began in 2008, with the investigation of UBS, which resulted in the 2009 UBS deferred prosecution agreement . Since 2008, the division has charged a total of 30 banking professionals and 62 account holders, which charges have so far resulted in three convictions after trial and 55 guilty pleas, including 16 guilty pleas this year alone.

In January, 2013, the U.S. Attorney’s Office in the Southern District of New York secured the guilty plea of Wegelin Bank, the oldest private bank in Switzerland, and the first foreign bank to plead guilty to felony tax charges. Appearing on behalf of the bank, managing partner Otto Bruderer admitted that the bank had conspired to defraud the United States by helping U.S. account holders hide assets from the IRS in undeclared accounts. In the same month, the federal district court in New York entered an order authorizing the IRS to issue a “John Doe” summons seeking records of Wegelin’s United States correspondent account at UBS, which will allow the United States to determine the identity of U.S. taxpayers who may hold accounts at Wegelin and other banks based in Switzerland to evade federal income taxes. In the past year, the Division has charged 8 banking professionals and 11 account holders in connection with investigations into offshore banks located in India, Israel, and Switzerland.

Some highlights from the division and the U.S. Attorney’s Offices includes:

· March 2013 - Zvi Sperling, of Los Angeles, pleaded guilty to conspiring to defraud the United States in connection with loans secured by funds in undeclared bank accounts in Israel. As part of the plea, Sperling admitted to failing to report over $380,000 in income and agreed to pay a civil penalty of 50 percent on his share of the high balance in the Israeli accounts, which at one point was $4 million.

· January 2013 - Mary Estelle Curran of Palm Beach, Fla., pleaded guilty to filing a false tax return for 2006 and 2007 and admitted that she had maintained an undeclared account at UBS. The plea agreement included a penalty of over $21.6 million for failing to file Reports of Foreign Bank and Financial Accounts (FBARs).

· August 2012 - Arvind Ahuja, a Wisconsin neurosurgeon who maintained an undeclared account at HSBC India, was convicted following a jury trial of filing a false 2009 income tax return and failing to file an FBAR.

Combating Identity Theft

The Tax Division, in conjunction with the IRS and U.S. Attorneys nationwide, has made a high priority the investigation and prosecution of individuals who engage in stolen identity refund fraud (SIRF). The division is targeting individuals involved in all stages of these schemes, including those who illegally obtain the Social Security numbers and other personal identifying information, those who file the false returns with the IRS, those who knowingly facilitate cashing the checks or otherwise obtaining the refunds, and those who mastermind or promote these scams.

Some highlights of the Tax Division’s success prosecuting perpetrators of identity theft over the past year include:

· March 2013 - Mary Bennett of Elmore County, Ala., was sentenced to 75 months in prison after pleading guilty to conspiracy to commit mail and wire fraud, as well as aggravated identity theft. Her two co-conspirators were sentenced to 24 and 18 months in prison.

· February 2013 - Antoinette Djonret of Montgomery, Ala., was sentenced to 144 months in prison and ordered to pay almost $1.3 million in restitution. Djonret and her co-conspirators filed over 1,000 false tax returns, establishing an elaborate network for laundering the refund money, and recruiting a number of individuals to purchase prepaid debit cards for use in the scheme.

· January 2013 - Masood Chotani, a CPA and tax return preparer from Los Angeles, pleaded guilty to conspiracy to defraud the United States for his role in a scheme in which he misappropriated employer identification numbers from his client files and provided information to co-conspirators who then filed over 250 fraudulent returns claiming more than $2 million in refunds. The refunds were deposited in foreign bank accounts. His co-conspirators are currently serving 30- and 37-month prison terms.

· November 2012 - Andrew J. Watts, a Barbados national, was sentenced in Chicago to 114 months in prison and ordered to pay restitution of just under $1.7 million for devising and executing a SIRF scheme in which he filed over 470 false federal income tax returns, claiming fraudulent refunds in excess of $120 million.

· May 2012 - Veronica Dale was sentenced to 27 years and 10 months in prison, and her co-conspirator, Alchico Grant, was sentenced to 25 years and 10 months in prison, for their roles as the leaders of a Montgomery, Ala., SIRF ring. They were also ordered to pay over $2.8 million in restitution to the IRS. Using the stolen identities of Medicare beneficiaries, Dale and Grant filed over 500 fraudulent refund claims, and then recruited others to set up a bank account in the name of a business into which more than $1.5 million in fraudulently obtained refunds were deposited.

Return Preparer Fraud

Corrupt accountants and fraudulent tax return preparers present a serious law enforcement concern. Some accountants and return preparers dupe unwitting clients into filing fraudulent returns, while others serve as willing “enablers,” providing a veneer of legitimacy for clients predisposed to cheat. The division’s civil injunction program, now more than 10 years old, continues to be an effective way to quickly shut down fraudulent return preparers and illegal tax-scheme promoters – especially during filing season – thereby reducing the harm to the public while potential criminal investigations are ongoing. In March, the Tax Division announced recent successes in its civil injunction program including more than 30 injunctions entered against both large-scale tax return preparation franchises and smaller, independent return preparers and promoters across the country in recent months.

Hiding income offshore, identity theft, and return preparer fraud are all part of the IRS’s “ Dirty Dozen Tax Scams.” More information about the Tax Division’s civil and criminal enforcement efforts in these and other areas is available on the Justice Department website. For more on the Dirty Dozen Tax Scams, see the IRS website and the IRS YouTube Channel.

A former U.S. Department of Homeland Security Office of Inspector General (DHS-OIG) special agent in charge and another special agent were indicted in the Southern District of Texas late yesterday for their roles in a scheme to falsify records and to obstruct an internal field office inspection, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and Special Agent in Charge Armando Fernandez of the FBI San Antonio Field Office.

The indictment returned by a federal grand jury in Brownsville, Texas, charges Eugenio Pedraza, 49, of McAllen, Texas, with six counts of falsification of records in federal investigations, five counts of obstructing an agency proceeding, one count of obstruction of justice and one count of conspiracy.  The indictment also charges Marco Rodriguez, 40, of Mission, Texas, with two counts of falsification of records in federal investigations, two counts of obstructing an agency proceeding and one count of conspiracy.

DHS-OIG is the principal component within DHS with the responsibility to investigate alleged criminal activity by DHS employees, including corruption affecting the integrity of U.S. borders.

According to the indictment, in September 2011, DHS-OIG conducted an internal inspection of its McAllen Field Office to evaluate whether its internal investigative standards and policies were being followed.  At that time, Pedraza was the special agent in charge of the McAllen Field Office, and Rodriguez was a special agent stationed there.  According to the indictment, in anticipation of the inspection, Pedraza allegedly directed Rodriguez and other DHS-OIG employees to engage in a scheme to falsify documents in open criminal investigative case files, including numerous investigations in which DHS employees were suspected of participating in the unlawful smuggling of undocumented aliens and/or narcotics into the United States.

More specifically, the indictment charges that at Pedraza’s direction, DHS-OIG employees allegedly created and placed into these investigative files backdated memoranda of activity that falsely reflected investigative activity by agents that had not occurred; backdated case review worksheets that falsely reflected supervisory case reviews that Pedraza had not conducted with his subordinate agents; and backdated, unsent letters that were signed by Pedraza and purported to inform the FBI of the opening of a DHS-OIG investigation.
                                                                                     
According to the indictment, the scheme’s purpose was to conceal severe lapses in DHS-OIG’s investigative standards from individuals conducting an internal field office inspection.  The scheme was allegedly devised to conceal Pedraza’s failure to ensure that investigations were being conducted promptly and thoroughly, his failure to provide his subordinates with adequate training and supervision, and his failure to ensure that the FBI was being timely notified of DHS-OIG’s investigations.

The indictment also charges Pedraza with allegedly directing two DHS-OIG employees to falsify memoranda of activity on additional occasions, and with obstructing justice by removing the falsified supervisory case review sheets that he had created from DHS-OIG files after becoming aware of the FBI and grand jury investigation into his conduct.

In a related case, on Jan. 17, 2013, Wayne Ball, a former DHS-OIG special agent, pleaded guilty in U.S. District Court for the Southern District of Texas before U.S. District Judge Randy Crane to one count of a multi-object conspiracy to falsify records in federal investigations and to obstruct an agency proceeding for his participation in the scheme.  Ball is scheduled to be sentenced on July 31, 2013.

The charge of falsification of records in federal investigations carries a maximum penalty of 20 years in prison.  The charge of obstructing an agency proceeding carries a maximum penalty of five years in prison.   The charge of obstruction of justice carries a maximum penalty of 20 years in prison.   The charge of conspiracy carries a maximum penalty of five years in prison.  Each of these charges carry a maximum fine of $250,000.

An indictment is not evidence of guilt.  All defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

The case is being prosecuted by Trial Attorneys Eric L. Gibson and Timothy J. Kelly of the Criminal Division’s Public Integrity Section.  The case is being investigated by agents of the FBI, San Antonio Division.

U.S. District Court Judge Joseph F. Bianco entered a consent decree of permanent injunction between the United States, Kabco Pharmaceuticals Inc. and its CEO and President Abu Kabir, the Justice Department announced today. The consent decree entered by the court enjoins the defendants from violating the Federal Food, Drug and Cosmetic Act (FDCA) in connection with their manufacturing, packing and distributing of dietary supplements. 

 In a complaint filed with the court, the United States alleged that Food and Drug Administration (FDA) inspections found that Kabco distributed dietary supplements, including Brewers Yeast Tablets, Dandelion Root Capsules, Night-Time Herb Capsules, Inositol Calcium & Magnesium Capsules, Vitamin C-500 with Rose Hips Time Released Tablets and Joint All Capsules, that did not meet product specifications.  As alleged in the complaint, during inspections of the defendants’ manufacturing facilities, FDA investigators found numerous current good manufacturing practice (cGMP) violations.  Among other violations, Kabco did not review and investigate product complaints, failed to hold dietary supplements under conditions designed to prevent product mix-ups and included unlabeled raw ingredients in their dietary supplements, including whey polio, an undeclared allergen.  Individuals who are allergic to milk could have a serious adverse health reaction from consuming any product with an undeclared milk allergen like whey polio.  

“When consumers purchase dietary supplements, they are entitled to know that they got what they paid for,” said Stuart F. Delery, Acting Assistant Attorney General of the Justice Department’s Civil Division.  “When supplement manufacturers fail to ensure that their products contain their labeled ingredients – especially when the labels do not warn consumers that the products may contain allergens dangerous to them – they put consumers at risk.  We stand ready to take appropriate enforcement steps against the manufacturers who cannot comply with their good manufacturing practice obligations.”   

 According to the government’s complaint, the FDA previously inspected the defendants’ facility and noted a history of violations and warnings.  As a result of the defendants’ most recent violations, as well as a history of unheeded warnings, the Justice Department filed this injunction.  Under the consent decree, the defendants agreed to stop manufacturing and distributing dietary supplements until, among other corrective actions, the company demonstrates to the FDA that it is meeting the quality, safety and labeling standards required by law.  The consent decree further requires the defendants to engage in appropriate, independent outside oversight to ensure compliance.

 Acting Assistant Attorney General Delery thanked the FDA for referring this matter for litigation.  Lauren Bell, Trial Attorney at the Consumer Protection Branch of the Justice Department, in conjunction with Melissa Mendoza, Associate Chief Counsel at FDA’s Office of the Chief Counsel, brought this case on behalf of the United States. 

NEW YORK -- Immigration Judge Javier Balasquide 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 April 5, 2013. The New York District Office of U.S. Citizenship and Immigration Services, Department of Homeland Security, hosted the ceremony.

Biographical Information

Attorney General Alberto Gonzales appointed Judge Balasquide in July 2006. Judge Balasquide received a bachelor of arts degree in 1988 from the University of Delaware and a juris doctorate in 1991 from the Interamerican University School of Law. From March 2003 to July 2006, he served as chief counsel at U.S. Immigration and Customs Enforcement (ICE), Department of Homeland Security (DHS), in Arlington, Va. From February 1999 to March 2003, he served at the former Immigration and Naturalization Service (INS) in Arlington and Falls Church, Va., in various capacities, including district counsel, appellate counsel, and assistant district counsel. From November 1991 to February 1999, Judge Balasquide served as an assistant district counsel for INS in Miami, entering on duty through the Attorney General=s Honors Program. Judge Balasquide is a member of the Puerto Rican 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.

ALICIA A.G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that Defendants Kenneth L. McLain, age 32, and Karl Kaii Baker, age 34, were sentenced today in the United States District Court, for Conspiracy to distribute more than 50 grams of methamphetamine (ice). McLain was sentenced to 108 months in prison, five years supervised release upon his release from prison and a $500 fine. Baker was sentenced to a term of 78 months in prison and five years supervised release. Additionally, the Court recommended to the Bureau of Prisons that McLain and Baker be placed in a drug rehabilitation program in a California.

In September 2011, the U.S. Postal Inspection Service (USPIS) intercepted a package in the mail containing methamphetamine. A search of the package revealed methamphetamine; the sender attempted to cover the odor emitted by the drug. Federal and local law enforcement conducted a controlled delivery of the package to McLain and Baker, who were subsequently arrested.

U.S. Attorney Limtiaco commends the hard work and efforts of the USPIS, Drug Enforcement Administration (DEA), Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Department of Homeland Security, Homeland Security Investigations, Guam Customs and Quarantine, Guam Police Department and the Guam Superior Court Probation office for their participation and assistance in this investigation. Assistant U.S. Attorney Clyde Lemons prosecuted the case.

The Department of Justice today announced that it has reached a settlement that will require Ecolab Inc. and Permian Mud Service Inc. to divest assets used by Permian’s subsidiary, Champion Technologies Inc., to provide production chemical management services in the U.S. Gulf of Mexico in order to proceed with their proposed merger.  The department said that the transaction, as originally proposed, would combine two of the three leading providers of production chemical management services for deepwater wells in the U.S. Gulf of Mexico. Without the divestitures, the department said the transaction would lead to higher prices, reduced service quality and diminished innovation.

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

“Ecolab’s subsidiary, Nalco Company, and Champion are currently the largest and second-largest providers of production chemical management services to deepwater wells in the U.S. Gulf of Mexico and have vigorously competed against one another to the benefit of their customers,” said Leslie C. Overton, Deputy Assistant Attorney General of the Department of Justice’s Antitrust Division. “The proposed remedy will preserve competition to provide these critical services, which support efficient production of oil and gas in deepwater environments.”

Production chemical management services involve the application of specially formulated chemical solutions to oil and gas wells to facilitate hydrocarbon production and protect well infrastructure.  These critical services are administered by experienced personnel including scientists, engineers and other lab technicians who customize the chemical blends and application methodology for specific well formations.

The department’s complaint alleges that the proposed acquisition would eliminate significant competition between Nalco and Champion in the already highly concentrated market for production chemical management services for deepwater wells in the U.S. Gulf of Mexico.  The proposed settlement requires the companies to divest to Clariant Corporation and its affiliate, Clariant International, assets Champion has been using to provide deepwater production chemical management services in the Gulf, including the patent for Champion’s best-selling production chemical in the deepwater Gulf,  exclusive licenses to all other production chemicals used by Champion in the U.S. Gulf of Mexico for use in that region, and the option to buy additional assets, including Champion’s deepwater production chemical blending and distribution facility in Broussard, La., and related equipment.  The settlement also provides Clariant with an extensive right to hire the merged firm’s relevant personnel, who possess essential expertise and know-how. 

Ecolab, headquartered in St. Paul, Minn., provides water treatment and sanitation products and services for a variety of industries, and began serving the oil and gas industry when it acquired Nalco in late 2011.  Nalco supplies specialty chemicals and services to the upstream and downstream segments of the oil and gas industry.  Ecolab generated $1.87 billion in revenues from oil and gas-related products and services in 2011. 

Permian, headquartered in Houston, is a privately held company that provides specialty chemicals and services to the oil and gas industry. Permian generated $1.25 billion in revenues in 2011. 

Clariant Corporation, headquartered in Charlotte, N.C., is the U.S. affiliate of Swiss-based Clariant International Ltd., the fourth largest provider of production chemical management services globally. Clariant has significant deepwater experience outside of the U.S. Gulf of Mexico.

As required by the Tunney Act, the proposed settlement and the department’s competitive impact statement will be published in the Federal Register.  Any person may submit written comments concerning the proposed settlement during a 60-day comment period to William H. Stallings, Chief, Transportation, Energy and Agriculture Section, Antitrust Division, U.S. Department of Justice, 450 Fifth St. N.W., Suite 8000, Washington, D.C. 20530, 202-514-9323.  At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may enter the proposed settlement upon finding that it is in the public interest.

The U.S. Department of Justice announced today that it has reached a settlement with Chiropractic Associates Ltd. of South Dakota (CASD), an association comprising approximately 80 percent of all practicing chiropractors in South Dakota.  The settlement prohibits CASD from jointly determining prices and negotiating contracts with insurers on behalf of competing chiropractors in South Dakota, North Dakota, Minnesota and Iowa.  The department said that CASD negotiated at least seven contracts with insurers that set prices for chiropractic services on behalf of CASD’s members and that CASD’s conduct caused consumers to pay higher fees for chiropractic services.

The department’s Antitrust Division filed a civil antitrust lawsuit in the U.S. District Court for the District of South Dakota against CASD.  At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the lawsuit.

“Chiropractic Associates Ltd. of South Dakota negotiated contracts on behalf of all its members, including competing providers, resulting in increased prices for chiropractic services in South Dakota,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “Today’s settlement promotes competition among health care providers and prevents collective action that harms consumers and violates the antitrust laws.”

According to the complaint, since 1997, CASD collectively negotiated the rates and price-related terms for at least seven contracts with insurers on behalf of CASD’s members.  Except for members who were part of the same practice groups, CASD’s members were not clinically or financially integrated, and CASD’s actions were not necessary to achieve any benefits for consumers. 

The proposed settlement will prevent CASD from establishing prices or terms for chiropractic services and from negotiating with insurers on behalf of competing chiropractors. The proposed settlement will also require CASD to terminate its current payer contracts at various specified times, but in no event later than three months after the court's entry of the final judgment.

 
CASD is a company organized and doing business under the laws of the state of South Dakota, with its principal place of business in Brookings, S.D.

The proposed settlement, along with the department’s competitive impact statement, will be published in the Federal Register as required by the Antitrust Procedures and Penalties Act.  Any person may submit written comments concerning the proposed settlement within 60 days of its publication to Peter J. Mucchetti, Chief, Litigation I Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 4100, Washington, D.C. 20530.  At the conclusion of the 60-day comment period, the court may enter the final judgment upon finding that it serves the public interest.

ALICIA A. G. LIMTIACO, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced today that defendant Francisco S. Pangelinan was sentenced in the U.S. District Court for the Northern Mariana Islands, to time served, followed by a three-year term of supervised release with conditions that he not possess a firearm and to perform 100 hours of community service. The defendant was ordered to serve an additional six (6) months ofhouse arrest on top of the eight (8) months house arrest he had already completed. Pangelinan' s sentence was the result of a Plea Agreement filed January 18, 2012, for Deprivation of Rights Under Color ofLaw. The conviction stemmed from a three-count indictment which charged Pangelinan with Deprivation of Rights Under Color ofLaw, in violation of Title 18, United States Code, Section 242. On July 26,2010, then a police officer, Pangelinan, unlawfully sprayed Felipe Kalen with DPS issued, Oleoresin Capsicum. At sentencing, Pangelinan apologized for his behavior to Felipe Kalen and acknowledged that he exceeded the force needed to deal with an ongoing argument at that time. Felipe Kalen accepted this apology and stated in court that he forgave the defendant. Pangelinan is no longer employed by the CNMI Department of Public Safety.

The case was investigated by agents from the Federal Bureau of lnvestigation and was prosecuted by Assistant United States Attorney Frederick A. Black.

The founder and president of the National Association of Special Police and Security Officers (NASPSO) was sentenced to 76 months in prison today for stealing union treasury and pension funds, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division.

Caleb Gray-Burriss, 62, of Washington, D.C., was convicted on Dec. 4, 2012, of six counts of mail fraud, seven counts of theft from a labor organization, one count each of obstruction of justice and criminal contempt, and three counts of union recordkeeping offenses. Gray-Burriss was sentenced by U.S. District Judge Richard W. Roberts of the District of Columbia and ordered to pay $252,000 in restitution and to perform 100 hours of community service. Because of these convictions Gray-Burris is also now disqualified by federal law from serving as an officer or being employed by a labor union or employee benefit plan until 13 years following his release from prison.

NASPSO represents private security guards assigned to protect federal buildings in the metro Washington area. According to the evidence at trial, from approximately June 2004 through February 2011, Gray-Burriss wrote numerous checks to himself or to other third parties from the NASPSO pension plan checking account.  Gray-Burriss spent more than $100,000 of the pension plan funds in this way, while falsely maintaining it was an operational fund that he was properly administering and that was providing benefits to the beneficiaries.  The evidence further showed that Gray-Burriss committed criminal contempt of a court order addressing his prior misappropriation of pension and health plan funds after Gray-Burriss resumed his scheme in 2009 to defraud employers and NASPSO members of pension funds.

 In addition, the evidence presented at trial showed that Gray-Burriss, while an officer and employee of NASPSO, stole over $150,000 in NASPSO funds consisting of cash withdrawals to himself, unauthorized salary increases and bonuses to himself and another person, fraudulently drawn checks to himself – purportedly for employment taxes on behalf of NASPSO – and unlawfully used NASPSO funds to pay his personal fines in a civil lawsuit.

The jury also found that Gray-Burriss committed obstruction of justice by destroying or concealing NASPSO financial records during a grand jury investigation; failing to file required annual reports on behalf of NASPSO, falsifying those reports, and failing to maintain properly the records of NASPSO.

The investigation was conducted by agents and investigators of the U.S. Department of Labor.  Trial Attorney Vincent J. Falvo of the Criminal Division’s Organized Crime and Gang Section and Trial Attorney Tracee Plowell, of the Criminal Division’s Public Integrity Section prosecuted the case.

A former Los Angeles resident, who fled to Canada and was a federal fugitive for 12 years, pleaded guilty today to aggravated identity theft and bankruptcy fraud in connection with leading a nearly 15-year foreclosure-rescue scam that fraudulently postponed foreclosure sales for more than 800 distressed homeowners, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney for the Central District of California André Birotte Jr., U.S. Attorney for the Northern District of California Melinda Haag, Assistant Director in Charge Bill L. Lewis of the FBI’s Los Angeles Field Office, Special Agent in Charge David J. Johnson of the FBI’s San Francisco Field Office and Christy Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP).
 
Glen Alan Ward, 48, pleaded guilty in connection with three separate sets of charges in the Central and Northern Districts of California, all stemming from Ward’s 15-year fraud.  In 2000, Ward became a federal fugitive when he failed to appear in court after signing a plea agreement, which arose out of federal charges in 2000 in the Central District of California related to Ward’s early conduct in the scheme.  In 2002, Ward was indicted on multiple counts of bankruptcy fraud in the Northern District of California for continuing the scheme in and around San Francisco.  On Aug. 17, 2012, Ward was indicted on mail fraud, aggravated identity theft, and additional bankruptcy fraud counts in the Central District of California after fleeing to Canada and continuing his fraud from there. While in Canada, Ward recruited Frederic Alan Gladle, who was indicted in the Central District of California for bankruptcy fraud and identity theft in 2011, and was sentenced in 2012 to 61 months in custody for engaging in similar conduct.

On April 5, 2012, Ward was arrested in Canada by the Royal Canadian Mounted Police and the Waterloo Regional Police Service based on a U.S. provisional arrest warrant. On Dec. 21, 2012, Ward was extradited to the United States to answer all three sets of charges.

“Glen Alan Ward spent years preying on distressed homeowners and stealing the identities of bankruptcy debtors, all to pad his own pockets,” said Acting Assistant Attorney General Raman. “Now he faces years in prison for his crimes. This successful prosecution illustrates our commitment to tirelessly pursuing fraudsters and ensuring that sophisticated schemes that prey on vulnerable homeowners will not go unpunished.”

“Mr. Ward fled the United States years ago in an attempt to keep his fraudulent foreclosure scheme running,” said United States Attorney André Birotte Jr.  “Today's conviction should serve as a reminder that criminals can run, but they can't hide.  The reach of the federal law is long and scammers like Ward, who try to take advantage of distressed homeowners, will be tracked down and prosecuted regardless of their efforts to do otherwise.”

According to the plea agreement filed today before U.S. District Judge Dale S. Fischer in the Central District of California, Ward admitted to engaging in a fraud scheme that took place from 1997 to April 5, 2012, the day he was arrested by Canadian authorities.  According to the plea agreement, Ward led a scheme that solicited and recruited homeowners whose properties were in danger of imminent foreclosure.  Ward promised to delay their foreclosures for as long as the homeowners could afford his $700 monthly fee.  Once a homeowner paid the fee, Ward accessed a public bankruptcy database and retrieved the name of an individual debtor who recently filed bankruptcy.  Ward admitted that he obtained copies of unsuspecting debtors’ bankruptcy petitions and directed his clients to execute, notarize and record a grant deed transferring generally a 1/100th fractional interest in their distressed home into the name of the debtor that Ward provided.  Then, after stealing the debtor’s identity, Ward faxed a copy of the bankruptcy petition, the notarized grant deed and a cover letter to the homeowner’s lender or the lender’s representative, directing it to stop the impending foreclosure sale due to the bankruptcy. 

Because bankruptcy filings give rise to automatic stays that protect debtors’ properties, the receipt of the bankruptcy petitions and deeds in the debtors’ names forced lenders to cancel foreclosure sales.  The lenders, which included banks that received government funds under the Troubled Asset Relief Program (TARP), could not move forward to collect money that was owed to them until getting permission from the bankruptcy courts, thereby repeatedly delaying the lenders’ recovery of their money for months and even years.  In addition, if a distressed homeowner wanted to complete a loan modification or short sale, they were left to the mercy of Ward to send them forged deeds, supposedly signed by the debtors, to re-unify their title as required by most lenders.

As part of the scheme, Ward delayed the foreclosure sales of approximately 824 distressed properties by using at least 414 bankruptcies filed in 26 judicial districts across the country.  During that same period, Ward admitted to collecting more than $1.2 million from his clients who paid for his illegal foreclosure-delay services, all of which he has agreed to forfeit.

“Today's announcement is the result of a collaborative international effort and the FBI is grateful to our partners with the Royal Canadian Mounted Police and the Waterloo Regional Police for their assistance in the fugitive investigation and apprehension,” said Bill Lewis, the Assistant Director in Charge of the FBI's Los Angeles Field Office. “Mr. Ward's long-term scheme is an extreme example of calculated fraud based on greed, and I'm proud of the persistence shown by our federal partners at SIGTARP, the Office of United States Trustees, and the United States Attorney's Office, in pursuing this case to its successful end."

“We are committed to pursuing those who defraud the most vulnerable victims of the real estate market,” said FBI San Francisco Special Agent in Charge David J. Johnson. “This is an excellent example of how closely we work with our law enforcement partners here and abroad to ensure that criminals are brought to justice.” 

“With today’s plea, justice is served for the victims of Ward’s long-running bankruptcy fraud scheme,” said Christy Romero, Special Inspector General for TARP (SIGTARP).  “While on the run for 12 years and having fled to Canada to avoid answering for earlier charges of bankruptcy fraud, Ward continued to victimize hundreds of struggling homeowners, steal the identities of unsuspecting U.S. taxpayers involved in bankruptcy proceedings, and exploit civil protections under bankruptcy law to defraud lenders, including numerous TARP recipients.  SIGTARP and our law enforcement partners will continue to ensure that those responsible for fraud related to TARP are brought to justice and answer for their crimes.”

Each count of bankruptcy fraud carries a maximum sentence of five years in prison. Aggravated identity theft carries a two-year mandatory sentence, to run consecutive to any other sentence. Ward will be sentenced on July 29, 2013 before United States District Judge Dale S. Fischer, and will continue to be held without bond.

This case is being prosecuted by Trial Attorney Paul Rosen of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Evan Davis of the U.S. Attorney’s Office for the Central District of California.  Assistant U.S. Attorney Jonathan Schmidt is prosecuting the charges in the Northern District of California, which were transferred to the Central District of California for entry of the guilty pleas.  The investigation was conducted by SIGTARP and the FBI, which received substantial assistance from the U.S. Trustee’s Office.  In addition, the Canadian Waterloo Regional Police Service and Royal Canadian Mounted Police provided exceptional support and assistance in connection with Ward’s arrest and extradition.

This prosecution is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 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 more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.

After an eight-week trial, a jury in Brooklyn, N.Y. today convicted Gustave Drivas, M.D.,  for his role at a clinic that engaged in a $77 million Medicare fraud scheme, announced the Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney for the Eastern District of New York Loretta Lynch, Assistant Director-in-Charge Janice K. Fedarcyk of the FBI’s New York field office and Special Agent-in-Charge Thomas O’Donnell of the HHS Office of Inspector General (HHS-OIG).

Dr. Gustave Drivas, 50, of Staten Island, N.Y., was convicted today of health care fraud conspiracy and health care fraud. He was acquitted of kickback conspiracy.

The trial evidence showed that Drivas, a medical doctor licensed in the state of New York, worked for a clinic in Brooklyn  that operated under three corporate names: Bay Medical Care PC, SVS Wellcare Medical PLLC and SZS Medical Care PLLC (the Bay Medical clinic). Owners, operators and employees of the Bay Medical clinic paid cash kickbacks to Medicare beneficiaries and used the beneficiaries’ names to bill Medicare for more than $77 million in services that were medically unnecessary and never provided.  The clinic billed Medicare for a wide variety of fraudulent medical services and procedures, including physician office visits, physical therapy and diagnostic tests. The evidence at trial demonstrated that Drivas was a “no show” doctor, yet his Medicare billing number was used to bill more than $20 million to the Medicare program, of which more than $12 million was paid.  Drivas signed numerous clinic applications to Medicare, was a signatory on two clinic bank accounts that received the ill-gotten Medicare money and was listed on bank paperwork as the president of Bay Medical.

The government’s investigation included the use of a court-ordered audio/video recording device hidden in a room at the clinic, identified in the complaint as the “Kickback Room,” in which the conspirators paid cash kickbacks to corrupt Medicare beneficiaries. The conspirators were recorded paying approximately $500,000 in cash kickbacks during a period of approximately six weeks from April to June 2010.  The Kickback Room was marked “PRIVATE” and featured a Soviet-era poster of a woman with a finger to her lips and the words “Don’t Gossip” in Russian. The purpose of the kickbacks was to induce the beneficiaries to receive unnecessary medical services or to stay silent when services not provided to the patients were billed to Medicare.

To generate the large amounts of cash needed to pay the patients, the conspirators used a network of external money launderers. The owners/operators of the clinic wrote clinic checks to numerous shell companies that were controlled by money launderers. These checks did not represent payment for any legitimate service at or for the Bay Medical clinics, but rather were written to launder the Bay Medical clinics’ fraudulently obtained Medicare proceeds. Two of the external money launderers, Anatoly Kraiter and Larisa Shelabadova, pleaded guilty prior to trial.  Irina Shelikhova and her son Maksim Shelikhov, who directed the money laundering operation from inside the clinic, also pleaded guilty prior to trial to conspiracy to commit money laundering.

At sentencing before U.S. District Judge Nina Gershon of the Eastern District of New York, scheduled for July 9, 2013, Drivas faces a maximum penalty of 20 years in prison. Drivas faces mandatory restitution to be paid jointly and severally with his co-defendants of up to $50 million, and a fine of up to $100 million. 

The charges were announced by the Justice Department's Criminal Division; U.S. Attorney for the Eastern District of New York Loretta E. Lynch; Assistant Director-in-Charge Janice K. Fedarcyk of the FBI’s New York field office; and Special Agent-in-Charge Thomas O’Donnell of the HHS Office of Inspector General (HHS-OIG).

The case is being prosecuted by Assistant U.S. Attorneys William C. Campos , Shannon C. Jones and Trial Attorney Sarah M. Hall of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS.

In total, 16 individuals were charged in the Bay Medical scheme, including two doctors, nine clinic owners/operators/employees and five external money launderers. Prior to trial, twelve defendants pleaded guilty. At trial, Alexander Zaretser, 32, of Brooklyn, New York was acquitted of money laundering conspiracy and two substantive counts of money laundering; and Vladimir Kornev, 53, and Yelena Galper, 40, both of Brooklyn, New York were acquitted of money laundering conspiracy.

The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section.   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, is taking steps to increase accountability and decrease the presence of fraudulent providers.

U.S. District Court Judge Melinda Harmon entered an order of permanent injunction against Chung’s Products LP, a Houston-based producer of egg  rolls and other foods, Charlie A. Kujawa, Chung’s president of operations, and Gregory S. Birdsell, Chung’s former director of quality assurance, the Justice Department announced today. 

The permanent injunction was issued by the district court along with the court’s opinion and order granting the United States’ motion for summary judgment against the defendants for violating the Federal Food, Drug and Cosmetic Act.  Chung’s products are sold in grocery stores and large retail stores nationwide.

As set forth in the complaint filed by the United States on March 8, 2010, the Food and Drug Administration (FDA) conducted inspections from 2005 through 2009 at Chung’s facility located in Houston.  According to the complaint, the defendants, among other things, violated the Food, Drug and Cosmetic Act by preparing, packing and holding shrimp egg rolls under insanitary conditions, whereby they may have become contaminated with filth and rendered injurious to health.

In a decision entered on April 4, 2013, Judge Harmon found that the defendants had a long history of violating the Food, Drug and Cosmetic Act, including producing food under insanitary conditions and failing to control for the risks of Clostridium Botulinum, “the most potent toxin known to man,” in their seafood products and a potentially deadly strain of listeria in their manufacturing environment.  The court also noted defendants’ numerous refusals to cooperate with the FDA.  Based on the evidence before it, the Court concluded there is a reasonable possibility that Chung’s food products were both contaminated with filth and unsafe and injurious to health.  The court further found that the defendants’ challenges to FDA testing methods were “frivolous” and “demonstrated [a] wanton disregard of a potential food safety hazard in [Chung’s] products.”

“We will continue to take strong action against those who would risk the safety of the American food supply by manufacturing and storing products under insanitary conditions or flouting important food safety rules,” said Acting Assistant Attorney General Stuart F. Delery of the Justice Department’s Civil Division.  “The Court’s ruling ensures that these defendants will take appropriate steps to ensure that consumers who purchase their foods will receive products that are prepared, packaged and held under sanitary conditions as required by law.”

Pursuant to the injunction issued by the Court, defendants are enjoined from receiving, processing, preparing, packing, holding and distributing food from Chung’s Houston-based facility or any other facility until defendants take the remedial action required by the Court’s order. 

Principal Deputy Assistant Attorney General Delery thanked the FDA for referring this matter to the Department of Justice.  David Sullivan, Trial Attorney at the Consumer Protection Branch of the Justice Department, in conjunction with Assistant U.S. Attorney Jose Vela Jr. in the Southern District of Texas and Sonia Nath, Associate Chief Counsel for Enforcement at FDA’s Office of the Chief Counsel, brought this case on behalf of the United States.

Update, April 10, 2013

On April 9, 2013, U.S. District Court Judge Melinda Harmon modified a paragraph of the injunction issued on April 4, 2013.  The modification enjoins defendants from receiving, processing, preparing, packing, holding and distributing any fish or fishery products from Chung’s Houston-based facility or any other facility until defendants take the remedial action required by the court’s order.

BALTIMORE --Immigration Judge Phillip T. Williams from the Executive Office for Immigration Review, Baltimore Immigration Court, delivered the keynote speech and administered the oath of allegiance to approximately 75 candidates during a naturalization ceremony at the George H. Fallon Federal Building in Baltimore, Md., on April 5, 2013. The Baltimore District Office of U.S. Citizenship and Immigration Services, Department of Homeland Security, hosted the ceremony.

Biographical Information

Attorney General Janet Reno appointed Judge Williams in March 1995. Judge Williams received a bachelor of arts degree in 1978 from Temple University, a master of arts degree in 1981 from Howard University, and a juris doctorate in 1986 from Howard University School of Law. From 1997 to 2008, he was an assistant chief immigration judge. From 1995 to 1997, he served as an immigration judge in New York. From 1987 to 1995, Judge Williams was an attorney with Maggio & Kattar in Washington, D.C. From 1984 to 1986, he worked as a District of Columbia pre-trial services officer. Judge Williams is a member of the District of Columbia and Pennsylvania Bars.

- EOIR -

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

The owners and operators of Biscayne Milieu, a Miami-based mental-health clinic, and the clinic itself were sentenced today for their participation in a Medicare fraud scheme involving the submission of more than $50 million in fraudulent billings to Medicare, 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.

Antonio Macli, 73, Jorge Macli, 41 and Sandra Huarte, 49, all of Miami, and Biscayne Milieu were sentenced by U.S. District Judge Robert N. Scola Jr. in the Southern District of Florida.  Antonio Macli was sentenced to serve 360 months in prison; Jorge Macli was sentenced to serve 300 months in prison; and Huarte was sentenced to serve 262 months in prison.  In addition, Biscayne Milieu, the corporate entity these defendants controlled, was sentenced to one year of probation.  In addition to their prison terms, Antonio Macli, Jorge Macli and Huarte were each sentenced to serve three years of supervised release.  Restitution payments for each of the defendants will be determined on April 25, 2013.

The defendants were each convicted on Aug. 24, 2012, of conspiracy to commit health care fraud, at least one substantive count of health care fraud, and conspiracy to offer and pay kickbacks following a two-month jury trial.  Antonio and Jorge Macli and Huarte were also each convicted of conspiracy to commit money laundering and substantive money laundering counts at trial. 

According to the evidence at trial, Biscayne Milieu was a closely held, family-run fraudulent clinic that was owned by Antonio Macli and his son Jorge Macli.  Antonio Macli’s daughter Sandra Huarte was an executive at the clinic.  Together the defendants created and oversaw a scheme in which they, along with their co-defendants, submitted over $50 million in false and fraudulent claims to Medicare through Biscayne Milieu, which purportedly operated a partial hospitalization program (PHP) – a form of intensive treatment for severe mental illness.  Instead, the defendants devised a scheme in which they paid patient recruiters to refer ineligible Medicare beneficiaries to Biscayne Milieu for services that were never provided or that were not reimbursable under applicable Medicare rules.  Many of the patients admitted to Biscayne Milieu that they were not eligible for PHP treatment because they were chronic substance abusers, suffered from dementia and would not benefit from group therapy, or were not mentally ill and were procuring false diagnoses of mental illness in order to obtain exemptions from the civics portion of the U.S. citizenship application. 

The evidence at trial further showed that Antonio and Jorge Macli and Huarte collectively paid patient recruiters more than $1 million in illegal kickbacks to recruit Medicare patients who were ineligible for PHP treatment.  Biscayne Milieu then billed Medicare for tens of millions of dollars in PHP treatments for these patients.  Antonio and Jorge Macli and Huarte also hired doctors, therapists and other health care professionals to further their massive illegal scheme.  Along with co-conspirators working at their direction, they created falsified medical records intended to conceal their Medicare fraud and phony “case manger” contracts in an attempt to hide their extensive illegal kickbacks. 

Antonio Macli was the initiator of the fraud scheme, enlisted his son and daughter to participate in it and had primary control over the clinic’s bank accounts that received money stolen from Medicare that was then used to pay illegal kickbacks. 

Jorge Macli was most responsible for the clinic’s day-to-day operations and took steps, on a daily basis, to conceal and further the fraud, including deflecting complaints from patients and staff and paying bribes to patients in exchange for their silence. 

Huarte oversaw both the kickback payments and the Medicare billings for the clinic.  Huarte ensured that Biscayne Milieu’s fraudulent claims could pass scrutiny by Medicare by creating fraudulent paperwork and medical files, and soliciting other employees to do the same, so that these false claims were paid. 

Evidence further revealed that Antonio and Jorge Macli and Sandra Huarte engaged in a sophisticated scheme to use a series of ostensibly legitimate corporations to conceal and launder Biscayne Milieu’s fraudulent profits. 

Various owners, doctors, managers, therapists, patient brokers and other employees of Biscayne Milieu have also been charged with various health care fraud, kickback, money laundering and other offenses in two indictments unsealed in September 2011 and May 2012. Biscayne Milieu, its owners, and more than 25 of the individual defendants charged in these cases have pleaded guilty or have been convicted at trial.

The case is being prosecuted by Assistant U.S. Attorneys for the Southern District of Florida Michael Davis, Marlene Rodriguez and James V. Hayes.  Hayes was formerly a Trial Attorney in the Criminal Division’s Fraud Section.  The case was investigated by the FBI with the assistance of HHS-OIG, and was brought by the U.S. Attorney’s Office for the Southern District of Florida in coordination with 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.

Vladislav Anatolievich Horohorin, aka “BadB,” was sentenced today to serve 88 months in prison for trafficking in millions of stolen credit and debit cards and for his role in the theft of more than $9 million dollars from an Atlanta-based credit card processor.

The sentence was announced by 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., U.S. Attorney for the Northern District of Georgia Sally Quillian Yates, U.S. Secret Service Assistant Director for Investigations David J. O’Connor and Special Agent in Charge Mark F. Giuliano of the FBI’s Atlanta Field Office.

Horohorin, 30, a citizen of Russia, Israel and Ukraine, was sentenced by U.S. District Judge Ellen S. Huvelle in the District of Columbia.  In addition to his prison term, Horohorin was ordered to pay $125,739 in restitution and sentenced to two years of supervised release.

Horohorin was indicted by a federal grand jury in the District of Columbia in November 2009 on charges of access device fraud and aggravated identity theft.  In a separate investigation, a federal grand jury in the Northern District of Georgia returned a superseding indictment against Horohorin in August 2010, charging him with conspiracy to commit wire fraud, wire fraud and access device fraud.  In August 2010, French law enforcement authorities, working with the U.S. Secret Service, identified Horohorin in Nice, France, and arrested him as he was attempting to board a flight to return to Moscow.  Horohorin was extradited to the United States on June 6, 2012.  After Horohorin’s arrival in the United States, the two cases pending against him were consolidated in Washington, D.C.

 On Oct. 25, 2012, Horohorin pleaded guilty to two counts of access device fraud as well as conspiracy to commit wire fraud.

According to Horohorin’s plea agreement, he used online criminal forums to sell stolen credit and debit card information, known as “dumps,” to online purchasers around the world.  Horohorin, using the online name “BadB,” advertised the availability of stolen credit and debit card information through these online forums and directed purchasers to create accounts at “dumps.name,” a fully-automated dumps vending website operated by Horohorin and hosted outside the United States.  At the time of his arrest, Horohorin possessed more than 2.5 million stolen credit and debit card numbers.
 
Horohorin admitted that he was one of the lead cashers in an elaborate scheme in which counterfeit payroll debit cards were used to withdraw more than $9 million from ATMs around the world.  Hackers broke into the computers of a credit card processor located in the Atlanta area, stole debit card account numbers and raised the balances and withdrawal limits on those accounts while distributing the account numbers and PIN codes to cashers, like Horohorin.  Horohorin, and those he recruited, used one of the stolen account numbers to withdraw more than $125,000 from ATMs in and around Moscow.

The District of Columbia case is being prosecuted by Trial Attorneys Ethan Arenson, Carol Sipperly and Corbin Weiss of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS). Weiss also serves as a Special Assistant U.S. Attorney for the District of Columbia. The District of Columbia case was investigated by the U.S. Secret Service.  Key assistance was provided by the French Police Nationale Aux Frontiers and the Netherlands Police Agency National Crime Squad High Tech Crime Unit.  The FBI Atlanta field office provided information helpful to the investigation.

The Northern District of Georgia case is being prosecuted by Assistant U.S. Attorneys Nick Oldham and Lawrence R. Sommerfeld of the Northern District of Georgia, and Trial Attorney Sipperly of CCIPS.  The Atlanta case was investigated by the FBI.  Assistance was provided by numerous law enforcement partners.  The U.S. Secret Service provided information helpful to the investigation.

The Criminal Division’s Office of International Affairs handled Horohorin’s extradition from France.

Charges were unsealed today against four former executives of BizJet International Sales and Support Inc., the U.S.-based subsidiary of Lufthansa Technik AG, which provides aircraft maintenance, repair and overhaul (MRO) services, for their alleged participation in a scheme to pay bribes to government officials in Latin America, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office. 

According to the charges, Bernd Kowalewski, the former president and chief executive officer of BizJet, Jald Jensen, the former sales manager at BizJet, Peter DuBois, the former vice president of sales and marketing at BizJet, and Neal Uhl, the former vice president of finance at BizJet, paid bribes to officials employed by the Mexican Policia Federal Preventiva, the Mexican Coordinacion General de Transportes Aereos Presidenciales, the air fleet for the Gobierno del Estado de Sinaloa in Mexico, the air fleet for the Estado De Roraima in Brazil, and the Republica de Panama Autoridad Aeronautica Civil in exchange for those officials’ assistance in securing contracts for BizJet to perform MRO services. 

Kowalewski and Jensen were charged by indictment filed in U.S. District Court for the Northern District of Oklahoma on Jan. 5, 2012, with conspiring to violate the Foreign Corrupt Practices Act (FCPA) and to launder money, as well as substantive charges of violating the FCPA and money laundering.  The two defendants are believed to remain abroad.

DuBois and Uhl pleaded guilty on Jan. 5, 2012, to criminal informations, and their pleas were unsealed today.  DuBois pleaded guilty to one count of conspiracy to violate the FCPA and one count of violating the FCPA.  Uhl pleaded guilty to one count of conspiracy to violate the FCPA.  Both defendants were sentenced today by U.S. District Judge Gregory K. Frizzell in the Northern District of Oklahoma.  DuBois’s sentence was reduced from a sentencing guidelines range of 108 to 120 months in prison to probation and eight months home detention based on his cooperation in the government’s investigation.  Uhl’s sentence was similarly reduced for cooperation from a guidelines range of 60 months in prison to probation and eight months home detention.

“The charges announced today allege a conspiracy by senior executives at BizJet to win contracts in Latin American countries through bribery and illegal tactics,” said Acting Assistant Attorney General Raman.  “Former BizJet executives, including the former president and chief executive officer, allegedly authorized and caused hundreds of thousands of dollars to be paid directly and indirectly to ranking military officials in various foreign countries, and two former executives have pleaded guilty for their roles in the conspiracy.  These charges reflect our continued commitment to holding individuals accountable for violations of the FCPA, including, as in this instance, after entering into a deferred prosecution agreement with their employer.”

“Business executives have a responsibility to act appropriately in order to maintain a fair and competitive international market,” said FBI Assistant Director in Charge Parlave.  “The unsealing of these bribery charges, and today’s sentencing, demonstrate that the FBI is committed to curbing corruption and will pursue all those who try to advance their businesses through bribery.”

The charges allege that the defendants, in many instances, paid bribes directly to foreign officials in Mexico, Panama and Brazil for assistance in securing contracts.  In other instances, the defendants allegedly funneled bribes through a shell company owned and operated by Jensen.  The shell company, Avionica International & Associates Inc., allegedly operated under the pretense of providing aircraft maintenance brokerage services but in reality laundered money related to BizJet’s bribery scheme.  Avionica was located at Jensen’s personal residence in Van Nuys, Calif., and Jensen was the only officer, director and employee.

The charges announced today follow the announcement on March 14, 2012, of a deferred prosecution agreement with BizJet and an $11.8 million monetary penalty to resolve charges related to the corrupt conduct.  That agreement acknowledged BizJet’s voluntary disclosure, extraordinary cooperation and extensive remediation in this case.

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 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 money laundering counts each carry a maximum penalty of 10 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 Attorneys Daniel S. Kahn and Stephen J. Spiegelhalter of the Criminal Division’s Fraud Section.  Assistant U.S. Attorney Kevin Leitch from the Northern District of Oklahoma has provided assistance in the case.  The department has also worked closely with its law enforcement counterparts in Mexico and Panama in this matter and is grateful for their assistance.  The case is being investigated by FBI agents who are part of the Washington Field Office’s dedicated FCPA squad.

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

Shusen Wei, 45, a citizen of China, pleaded guilty today in Miami federal court to charges stemming from his involvement in the smuggling of a carved rhinoceros horn from the United States to China, announced Ignacia S. Moreno, Assistant Attorney General for the Environment & Natural Resources Division, Wifredo A, Ferrer, U.S. Attorney for the Southern District of Florida, and William C. Woody, Chief of the U.S. Fish & Wildlife Service’s Office of Law Enforcement.

Wei entered his guilty plea before U.S. District Judge Cecilia M. Altonaga, who scheduled sentencing for April 29, 2013.  Wei faces a possible term in prison of up to 10 years on the single count filed against him, a fine of up to $250,000, and a term of supervised release of up to three years.

According to documents filed in Court, Wei traveled from China to Miami, Fla., in January 2013, to attend the Original Miami Beach Antique Show.  While attending the show, he roomed with another Chinese national who was later arrested for smuggling of rhinoceros horns from the United States to China.  In pleading guilty, Wei admitted that he paid commissions to this other individual to purchase objects made of rhino horn in the United States and smuggle them to China and that he knew that this individual was engaged in the smuggling of protected species of wildlife, including rhinoceros horn and elephant ivory. Wei also knew that this individual had paid bribes to Chinese customs officials to assist in his smuggling.  Special Agents with the U.S. Fish & Wildlife Service learned that Wei had previously purchased libation cups made from carved rhinoceros horns from this same individual. One of those items was sold at a U.S. auction house for $242,500.  This and other photographs of carved rhinoceros horns were found on Wei’s cell phone.  

Rhinoceros are an herbivore species of prehistoric origin and one of the largest remaining mega-fauna on earth. They have no known predators other than humans. All species of rhinoceros are protected under United States and international law, and all black rhinoceros species are endangered. Since 1976, trade in rhinoceros horn has been regulated under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), a treaty signed by 178 countries around the world to protect fish, wildlife and plants that are or may become imperiled due to the demands of international markets. Nevertheless, the demand for rhinoceros horn and black market prices have skyrocketed in recent years due to the value that some cultures have placed on ornamental carvings, good luck charms or alleged medicinal purposes, leading to a decimation of the global rhinoceros population. As a result, rhino populations have declined by more than 90 percent since 1970. South Africa, for example, has witnessed a rapid escalation in poaching of live animals, rising from 13 in 2007 to 668 in 2012.

Mr. Ferrer commended the investigative efforts of the Special Agents of the U.S. Fish & Wildlife Service and thanked the U.S. Attorneys Offices in the Eastern District of New York and the District of New Jersey for their assistance. The case is part of “Operation Crash” (named for the term used to describe a herd of rhinoceros) which is an ongoing multi-agency effort to detect, deter, and prosecute those engaged in the illegal killing of rhinoceros and the unlawful trafficking of rhinoceros horns.  This matter is being prosecuted by Assistant U.S. Attorney Thomas Watts-FitzGerald and Richard A. Udell, a Senior Counsel with the Environmental Crimes Section of the U.S. Department of Justice. 

Walter Scott Steele, a former correctional officer at Roxbury Correctional Institution (RCI), and Lanny Harris, a former correction sergeant at RCI in Hagerstown, Md., pleaded guilty today in relation to assaults against an inmate on March 9, 2008. Harris pleaded guilty to conspiring with other RCI officers to assault an inmate at the state prison on March 9, 2008. Steele pleaded guilty to conspiring with RCI officers to obstruct the investigation into an assault against an inmate on March 9, 2008, and to making a false statement to an FBI agent investigating the assault. With these pleas, five former RCI correctional officers have pleaded guilty and 10 others face charges.

According to court documents filed in connection with his guilty plea, Steele admitted that, during the midnight shift on March 8-9, 2008, he heard RCI officers discuss assaulting the inmate, identified in court documents only as “K.D.,” in retaliation for K.D.’s prior assault of another officer. Steele warned the group that they would get caught if they assaulted the inmate.

Additionally, according to court documents filed in connection with his guilty plea, Harris and other officers met at RCI during the midnight shift and agreed to assault K.D. in retaliation for a prior incident involving the inmate and another officer. Harris admitted that he and three other correctional officers then entered K.D.’s cell in order to assault inmate K.D., while a fourth officer watched. Officers then assaulted K.D. while Steele watched.

Steele admitted that he later learned that officers from the midnight shift were meeting at a McDonald’s restaurant to talk about the assault on inmate K.D. Steele acknowledged meeting Harris and other RCI officers who had been involved in the assault, and discussing what they were going to say to investigators. Steele agreed to tell investigators that he did not know about an assault on inmate K.D.

Steele admitted in court that he lied to federal investigators on Feb. 12, 2013, by falsely denying that he had discussed K.D. with other RCI officers from the midnight shift. Steele also acknowledged that he failed to tell federal investigators that he had seen other officers assault K.D.

“Mr. Harris admitted today that, as a supervisor, he conspired with other officers to assault an inmate in order to punish the inmate for hitting an officer. Mr. Steele, meanwhile, has admitted that, after he watched his fellow correctional officers use force to punish the inmate, he then agreed to help those officers cover up their misconduct,” said Roy L. Austin Jr., Deputy Assistant Attorney General for the Civil Rights Division. “The Justice Department will continue to vigorously prosecute officers who use their official position to abuse inmates or to cover up crimes committed by other officers.”

Steele faces a maximum penalty of 10 years in prison. Harris faces a maximum penalty of five years in prison. Sentencing for Steele is set for July 9, 2013, and sentencing for Harris is set for Aug. 2, 2013, both before U.S. District Judge James K. Bredar.

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

The U.S. Department of Justice and the U.S. Environmental Protection Agency (EPA) announced a Clean Air Act (CAA) settlement with Tyson Foods Inc. and several of its affiliate corporations to address threats of accidental chemical releases after anhydrous ammonia was released during incidents at facilities in Kansas, Missouri, Iowa and Nebraska, resulting in multiple injuries, property damage and one fatality.

“This settlement will protect workers at Tyson facilities throughout Kansas, Iowa, Missouri and Nebraska that use anhydrous ammonia, and make the communities surrounding these 23 facilities safer.  It will also provide emergency response equipment for first responders to chemical releases,” said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.  “The requirements of this agreement, which include comprehensive third party audits, will help mitigate the impact of releases of anhydrous ammonia by ensuring compliance with the Risk Management Program under the Clean Air Act.

“Exposure to anhydrous ammonia can cause serious health issues, and in extreme cases, even death,” said Cynthia Giles, Assistant Administrator for EPA’s Office of Enforcement and Compliance Assurance. “Today’s settlement with Tyson Foods will ensure the proper safety practices are in place in the future to protect employees, first responders, and communities located near processing facilities from the threat of dangerous chemical releases.”

Under the terms of the consent decree, Tyson is required to conduct third-party audits of its current compliance with the CAA’s Risk Management Program requirements at all 23 facilities in Kansas, Iowa, Missouri and Nebraska. The third-party auditors must have expertise in ammonia refrigeration systems, be recognized experts in risk management program compliance and be approved by EPA.  Tyson must correct any violations discovered in the audits and certify the completion of the work. Tyson has also agreed to test certain piping used in its refrigeration systems at the 23 facilities to identify any problems that may have led to accidental releases and to replace any non-compliant piping.

Under the consent decree, Tyson will pay a $3.95 million penalty. Tyson has also agreed to implement a supplemental environmental project to purchase $300,000 worth of emergency response equipment for first responders in communities with significant environmental justice concerns in which Tyson operates facilities.  The equipment will assist responses to emergencies involving chemicals that are regulated pursuant to the CAA Risk Management Program, including anhydrous ammonia.

Anhydrous ammonia is a poisonous gas and considered an extremely hazardous substance under the CAA. Exposure to vapors can cause temporary blindness and eye damage, as well as irritation of the skin, mouth, throat, respiratory tract and mucous membranes. Prolonged exposure to anhydrous ammonia vapor at high concentrations can lead to serious lung damage and even death. 

The Clean Air Act’s Risk Management Program requires owners and operators of facilities that exceed a threshold quantity of a regulated substance, such as anhydrous ammonia, to develop and implement a risk management plan that must be submitted to EPA. The 23 Tyson facilities named in the consent decree are subject to the regulations because the refrigeration systems at the facilities each contain more than 10,000 pounds of anhydrous ammonia. The facilities have a combined inventory of more than 1.7 million pounds of anhydrous ammonia.

Tyson Foods Inc. is headquartered in Springdale, Ark. and is the world’s largest processor and marketer of chicken, beef and pork.

The proposed settlement lodged in the U.S. District Court for the Eastern District of Missouri, is subject to a 30-day public comment period and final court approval. A copy of the consent decree is available on the Justice Department website at www.usdoj.gov/enrd/Consent_Decrees.html. 

More information:  www.epa.gov/enforcement/waste/cases/tysonfoodsinc.html
 

The Justice Department announced today that under its 2011 settlements with BAC Home Loans Servicing LP, a subsidiary of Bank of America Corporation, and Saxon Mortgage Servicing Inc., a subsidiary of Morgan Stanley, 316 service members whose homes were unlawfully foreclosed upon between 2006 and 2010 are due to receive over $39 million in monetary relief for alleged violations of the Servicemembers Civil Relief Act (SCRA).

Under the first settlement, Bank of America is required to pay over $36.8 million to service members whose homes were unlawfully foreclosed upon between 2006 and 2010. Each service member will receive a minimum of $116,785, plus compensation for any equity lost with interest. Bank of America has already begun compensating 142 service members whose homes were illegally foreclosed on between 2006 and the middle of 2009.  Under the same agreement, Bank of America agreed to provide information about its foreclosures from mid-2009 through the end of 2010. As a result of that review, Bank of America will now pay 155 service members upon whose homes it illegally foreclosed. Borrowers receiving payment under this settlement may receive an additional payment under a settlement between Bank of America and federal banking regulators -- the Office of the Comptroller of the Currency and the Board of Governors of the Federal Reserve System -- if the foreclosure occurred in 2009 or 2010. Payments provided under the federal banking regulators’ settlement will bring the total amount received by eligible borrowers to $125,000 plus equity where applicable.

Under the second settlement, Saxon Mortgage Services Inc. is in the process of paying out over $2.5 million to 19 service members whose homes were unlawfully foreclosed upon between 2006 and 2010. Each service member will receive a minimum of $130,555.56, plus compensation for any equity lost with interest.

Bank of America is one of five mortgage servicers that entered into a settlement, known as the National Mortgage Settlement, with the Justice Department in 2012 regarding its foreclosure practices. Pursuant to the National Mortgage Settlement, the Justice Department is overseeing ongoing audits of the five largest mortgage servicers in the country (Wells Fargo, Bank of America, Citibank, JP Morgan Chase and Ally) to identify violations of the SCRA’s foreclosure provisions between Jan. 1, 2006 and April 4, 2012 and its 6 percent interest rate cap provision between Jan. 1, 2008 and April 4, 2012. The $36.8 million currently being paid by Bank of America to 297 service members is pursuant to the 2011 consent decree (which predated the National Mortgage Settlement), and represents only the non-judicial foreclosures conducted by Bank of America. As the National Mortgage Settlement audits progress, the Justice Department will be requiring payments by Bank of America for judicial foreclosure and interest rate violations, and by the other four servicers for judicial and non-judicial foreclosure and interest rate violations. Under the National Mortgage Settlement most service members wrongly foreclosed on will receive $125,000 plus any lost equity. For the foreclosure violations that took place in 2009 and 2010, the Justice Department is coordinating closely with the Office of the Comptroller and the Federal Reserve Board, which are conducting separate reviews of 12 mortgage servicers under the Independent Foreclosure Review process.

“Our men and women in the military should not have to worry about a bank foreclosing on their home while they bravely serve our country,” said Eric Halperin, Special Counsel for Fair Lending in the Civil Rights Division. “The Justice Department will vigorously enforce the laws that protect service members while they do their difficult and necessary work.”

The SCRA provides critical additional consumer and other protections to the men and women serving our nation in the military.  For more information on the Justice Department’s work to enforce service members’ rights, please visit www.servicemembers.gov.

The Justice Department announced today that, as part of its Barrier-Free Health Care Initiative, over the past year it has reached seven settlements with eight health care providers from across the United States to ensure that they are providing effective communication to people who are deaf or have hearing disabilities. These settlements address the requirements of the Americans with Disabilities Act (ADA) for health care providers, such as hospitals, medical clinics, nursing homes and doctor’s offices, to provide effective communication to people who are deaf or have hearing disabilities 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. Six of the seven settlements were obtained by the U.S. Attorney’s Offices. The settlement obtained by the department’s Civil Rights Division covers two facilities.

The seven settlements from the past year are:

• April 2012 - Richard Noren, M.D., Henry Kurzydlowski, M.D. and Pain Care Consultants Inc ., in the Northern District of Illinois and
• May 2012 - Steven Senica, M.D., and Senica Bruneau, in the Northern District of Illinois;
• June 2012 - Northshore University HealthSystem  in the Northern District of Illinois;
• November 2012 - Dr. Paul S. Biedenbach & Northern Ohio Medical Specialists Healthcare in the Northern District of Ohio;
• January 2013 - The Center for Orthopaedic and Sports Medicine in the Eastern District of Virginia;   
• March 2013 - Manassas Health and Rehabilitation Center and Gainesville Health and Rehabilitation Center, both in the Eastern District of Virginia;
• March 2013 - Monadnock Community Hospital in the District of New Hampshire 

“Disability-based discrimination in health care is illegal under the Americans with Disabilities Act and will not be tolerated,” said Eve L. Hill, Senior Counselor to the Assistant Attorney General for the Civil Rights Division. “All types of health care providers – from hospitals to nursing homes, from surgeons to general practitioners – all across the country – need to provide equal access to people with disabilities, including people who are deaf. More than 20 years after passage of the ADA, the time for compliance is now.” 

In addition to the department’s settlements, in early March, the U.S. Department of Health and Human Services (HHS) Office for Civil Rights (OCR) reached a settlement agreement with Genesis HealthCare, one of the nation’s largest providers of senior care with over 400 facilities, to provide sign language interpreters and other means of effective communication to individuals who are deaf or hard of hearing.

OCR Director Leon Rodriguez noted “My office continues its enforcement activities and work with providers, particularly large health care systems like Genesis, to make certain that compliance with nondiscrimination laws is a system wide obligation.”

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. Although handwritten notes or typed text can be an appropriate auxiliary aid for simple communications, in complex health care-related communications, a qualified sign language interpreter may be required. The individual with a disability cannot be charged extra for the cost of an interpreter or other auxiliary aid.

The Justice Department found that at each of the eight facilities, a person who is deaf sought to access health care services and was denied a needed sign language interpreter, resulting in discrimination on the basis of disability. By not providing a sign language interpreter or otherwise communicating effectively with the individuals who are deaf, the facilities and doctors were compromising the overall health of their patients.

In the Monadnock Community Hospital settlement, the complainant went to the emergency department at the hospital for treatment for an allergic reaction that caused her to have difficulty breathing. Upon entering the hospital she requested a sign language interpreter by presenting an Emergency Interpreter Referral Card.  Despite this request, hospital staff attempted to use the complainant’s 11-year-old daughter as an interpreter.  The complainant repeatedly asked for an interpreter during her time in the ER, where she was administered medical procedures.  She was eventually discharged, and although she was provided with discharge paperwork, she alleged she had no understanding of what was done to her, and had no understanding of the discharge document.

In the Center for Orthopaedic and Sports Medicine settlement, the patient, who is deaf, repeatedly requested an interpreter for multiple medical and physical therapy appointments related to a back injury. The orthopedic practice told the patient it was her responsibility to provide an interpreter and did not provide her with an interpreter at any of her appointments. Similarly, in the Northern Ohio Medical Specialists matter, the complainant, who is deaf and communicates using American Sign Language (ASL), sought medical care and requested an interpreter, but Northern Ohio Medical Specialists refused to provide an interpreter for her at her appointment, citing company policy.

In the Northshore University HealthSystem matter, R.A., who is deaf, was the primary caretaker of his 80-year-old mother S.A. On three separate occasions, for an emergency room visit and two hospitalizations, R.A. and S.A. requested a sign language interpreter so R.A. could communicate with the hospital’s medical personnel about his mother’s condition. R.A. was told that the hospital does not provide interpreters to family members of patients who are not hearing impaired.

Under each settlement agreement, the health care provider agreed to change their policies to provide effective communication, including sign language interpreters, free of charge, and to train all staff on their new policies and procedures and the effective communication requirements of the ADA. Under the terms of the agreements with Monadnock Community Hospital, the Center for Orthopaedic and Sports Medicine, the Northshore University Health Specialists, Senica Bruneau and Noren, monetary damages were paid to the complainants. In the Northshore University HealthSystem and the Northern Ohio Medical Specialists settlements, the health care providers agreed to pay a civil penalty to the United States. Under the ADA a civil penalty of up to $55,000 may be assessed against a healthcare provider or other entity that violates the ADA.

The Barrier-Free Health Care Initiative addresses access to health care for people with hearing disabilities and for people with HIV, as well as physical access to health care facilities. Earlier this year the Civil Rights Division and U.S. Attorney’s offices reached four settlement agreements regarding access to medical care for people with HIV in just five weeks.

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, and publications specific to health care providers, HIV discrimination, and effective communication with people with hearing and vision disabilities, as well as publications about tax credits available for providing access.  For more information on the ADA and to access these publications, visit www.ada.gov.  The seven Barrier-Free Health Care Initiative settlements 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 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 be filed by email to ada.complaint@usdoj.gov.

U.S. Attorney General Eric Holder and European Commission Vice President Viviane Reding met today in Washington, D.C. They had cordial discussions on a wide range of fields of collaboration between the Department of Justice and the European Commission. 

Among the topics discussed were victims’ rights, rights of persons with disabilities and the need to protect children against online predators.  Attorney General Holder referred to the experience both of the department’s Office for Victims of Crime and the Disability Rights Section of the department’s Civil Rights Division. Attorney General Holder and Vice President Reding welcomed the opportunity for a meeting of experts in this regard.   Both Attorney General Holder and Vice President Reding also noted the important role that Eurojust, the European Union’s Judicial Cooperation Unit, has taken in coordinating highly successful multilateral investigations, including investigations of online child predators, and both committed to ensuring the continuation of such collaboration through Eurojust.   

The meeting concluded with a discussion of the ongoing negotiations for a data protection agreement covering police and judicial information.  They noted the importance attached on both sides of the Atlantic to providing a high level of personal data and privacy protection for all individuals. Attorney General Holder and Vice President Reding expressed appreciation for the ongoing and positive dialogue between U.S. and EU experts on protecting and sharing data on the basis of a commonly agreed framework.  Each noted recent progress made, and both sides were optimistic in reiterating their determination to finalize negotiations as rapidly as possible.

Alicia A.G. Limtiaco, United States Attorney for the Districts of Guam and the Northern Mariana Islands, was awarded the 2013 Visionary Voice Award from the National Sexual Violence Resource Center (NSVRC). The Visionary Voice Award highlights individuals throughout the country who are doing outstanding work in the field of anti-sexual violence within their communities and whose prevention work is making an impact in their communities. This year, the National award honors 26 leaders in sexual violence prevention.

The Guam Coalition Against Sexual Assault and Family Violence (GCASAFV) nominated U.S. Attorney Limtiaco for the 2013 Visionary Voice Award and invited her to the "Proclamation Signing and Remembrance Ceremony" commemorating Sexual Assault Awareness Month, National Child Abuse Prevention and Awareness Month, and Crime Victims' Rights Week. The Proclamation Signing by the Honorable Ray Tenorio, Acting Governor of Guam, and Remembrance Candle Lighting and Reflection Ceremony honoring all victims of violence and led by the faith based community, were held at the Latte ofFreedom on April1, 2013. GCASAFV Executive Director Cynthia Cabot expressed thanks to U.S. Attorney Limtiaco for building the foundation and presented her with a crystal clock signifying this year's theme of Sexual Assault Awareness Month-- "It's Time ... To Talk About It!"

The GCASAFV nominated U.S. Attorney Limtiaco citing to her over 20 years of commitment and dedication to enforcement, prosecution, public awareness and prevention efforts to combat against and end sexual assault and family violence. Prior to commencing her service as U.S. Attorney in 2010, Limtiaco was the first woman elected to serve as Attorney General of Guam. Limtiaco was an active member of the National Association of Attorneys General (NAAG) and Conference of Western Attorneys General (CW AG), and served as Co-chair of the NAAG Criminal Law Committee and NAAG Youth Access to Alcohol Committee, and as Second Vice Chair of the CW AG Executive Team. She spearheaded certain initiatives including the formation of task forces to address human trafficking; internet crimes against children including sexual exploitation and child pornography; and the implementation and compliance of Sex Offender Registration and Notification Act (SO RNA) requirements by the Government of Guam. She served as the Chair of the Executive Branch ofthe Family Violence and Sexual Assault Task Force, and was an active member of the Sexual Assault Response Team (SART) Steering Committee.

Prior to her tenure as Attorney General, Limtiaco served as acting Chief Prosecutor and as an Assistant Attorney General (Prosecutor) for the Office of the Attorney General. She was the Lead Prosecutor of the Criminal Sexual Conduct and Family Violence Unit, and Co-chair of the Governor's Family Violence Task Force. Limtiaco initiated the drafting and implementation of family violence protocol utilized by the Prosecution Division and Guam Police Department, and assisted in the drafting of the 1994 and 1998 Guam Family Violence Acts, and the Sex Offender Registration and Notification law enacted in 1999.

As U.S. Attorney, Limtiaco is a member of the Attorney General's Advisory Committee (AGAC) Subcommittees/ Working Groups, including the Civil Rights, and Child Exploitation and Obscenity Working Groups. U.S. Attorney Limtiaco and the U.S. Attorney's Office (USAO) continues to work collaboratively with the National District Attorney's Association; U.S. Department of Interior, Office oflnsular Affairs, Federal Ombudsman Office; and U.S. Department of State, Monitoring of Trafficking in Persons Office, on a Pacific Regional Response to Combat Human Trafficking. This response is a critical component of the USAO's human trafficking strategic plan given increased concerns in the Pacific region regarding sex and labor trafficking, violence against women, and child abuse and sexual exploitation. Also of significance are the source countries within the Asia Pacific region from which victims are recruited and trafficked, and their close proximity to Guam, the NMI, Republic of Palau, Republic of the Marshall Islands, and Federated States ofMicronesia ("FSM"); and the trafficking of victims in the islands themselves. The Pacific Regional Response to Combat Human Trafficking initiative employs a multi-disciplinary model, including participation, coordination, and collaboration among law enforcement; prosecution; victim service providers; social services; medical, mental and public health professionals; faith based organizations; educational institutions; Consulates; and other community stakeholders. The response calls for the establishment and provision of victim services, investigation and prosecution of human trafficking, training opportunities, community outreach/ public awareness and prevention programs, and creation of human trafficking task forces and coalitions in the Pacific region island communities. Providing fundamental training in human trafficking, including victimization, investigation and prosecution, prevention efforts, and other related topics, to law enforcement; prosecution; victim service providers; social services; medical, mental and public health professionals; faith based organizations; educational institutions; Consulates; and other community stakeholders, in our Pacific region island communities, is critical to effective prevention and enforcement efforts in the region. U.S. Attorney Limtiaco has been instrumental in coordinating human trafficking, sexual assault and child sexual exploitation training in Guam, the Northern Mariana Islands, the Republic of Palau, and Federated States of Micronesia; and facilitating the Guam Human Trafficking Task Force efforts, including those of the Victim Service Providers Committee.

NSVRC Director Karen Baker, in a press release, stated that "it is an honor to celebrate these outstanding individuals, who have committed themselves to sexual violence prevention. Recognizing the positive impact of this work on a national level is a great reminder that we all can make a difference."

To learn more about Sexual Assault Awareness Month and the Visionary Voice Award, visit www.nsvrc.org.

Intermountain Health Care Inc. has agreed to pay the United States $25.5 million to settle claims that it violated the Stark Statute and the False Claims Act by engaging in improper financial relationships with referring physicians, the Justice Department announced today. Intermountain operates the largest health system in the state of Utah.

The Stark Statute restricts the financial relationships that hospitals may have with doctors who refer patients to them. The relationships at issue in this matter that the United States alleged were prohibited by the Stark Statute included employment agreements under which the physicians received bonuses that improperly took into account the value of some of their patient referrals; and office leases and compensation arrangements between Intermountain and referring physicians that violated other requirements of the Stark Statute. These issues were disclosed to the government by Intermountain.

“The Department of Justice has longstanding concerns about improper financial relationships between health care providers and their referral sources, because such relationships can corrupt a physician's judgment about the patient's true healthcare needs,” said Stuart F. Delery, Acting Assistant Attorney General for the Department’s Civil Division. “In addition to yielding a recovery for taxpayers, this settlement should deter similar conduct in the future and help make health care more affordable for patients.”

“People should expect that hospitals and doctors care more for their patients than their bottom line profits,” said Gerald Roy, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services region including Utah. “So I applaud Intermountain for recognizing their liability and coming forward to self-disclose these violations.  We will vigilantly protect taxpayer-funded health programs against Stark violations through tight coordination with our partners at the Department of Justice.” 

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 $10.2 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. 

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

The Justice Department announced today that Fluor Hanford LLC has agreed to pay $1.1 million to settle allegations that Fluor violated the False Claims Act by using federal funds for lobbying. Fluor is a Department of Energy (DOE) contractor that performs management and engineering services at the DOE’s Hanford Nuclear Site in eastern Washington. Fluor’s parent company, Fluor Corporation, is headquartered in Texas and performs engineering, construction and personnel services for commercial and government customers.

Between 2005 and 2009, Fluor contracted with the DOE to manage and operate the Hazardous Materials Management and Emergency Response (HAMMER) Center. The HAMMER Center provides homeland security and emergency response training to first responders and law enforcement personnel. Fluor allegedly used DOE funds to lobby Congress and other federal officials to increase funding for the HAMMER Center, in violation of a federal law known as the Byrd Amendment, which prohibits the use of federal funds for lobbying.

“The money allocated by Congress for this program was designed to train first responders and law enforcement personnel to respond to crisis situations, not to lobby Congress for more funding,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division of the Department of Justice. “This resolution demonstrates that the Justice Department will work to ensure that public funds are not used to influence legislation.”

“The cleanup efforts at Hanford are too important to have prime contractors who misuse government funds to lobby for more government funds,” said Michael C. Ormsby, U.S. Attorney for the Eastern District of Washington.  “We are pleased that Fluor has settled these allegations and hope that this serves as a reminder to all prime contractors at Hanford that they must be good stewards of tax payer dollars.”

The allegations resolved by today’s settlement were initially alleged in a whistleblower lawsuit filed under the False Claims Act by Loydene Rambo, a former employee of Fluor. Under the False Claims Act, private whistleblowers can sue on behalf of the United States for false claims. The United States has the right to take over the action, as it did here. The whistleblower is entitled to a share of any recovery. Rambo will receive $200,000 of the government’s settlement.

This case was handled by the Civil Division of the Department of Justice and the U.S. Attorney’s Office for the Eastern District of Washington, with investigative assistance provided by the Department of Energy’s Office of Inspector General.

The False Claims Act suit was filed in the U.S. District Court for the Eastern District of Washington, and is captioned United States ex rel. Rambo v. Fluor Hanford, LLC et al., No. cv-11-5037 (E.D. Wash.). The claims settled in this case are allegations only; there has been no determination of liability.

The Department of Justice today announced that a federal grand jury sitting in Seattle has indicted Jamie Larson, 49, on a federal hate crime charge relating to a racially-motivated assault of a 50-year-old Sikh man.

Larson has been charged with one count of violating the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act that was enacted in October 2009.  The indictment alleges that on Oct. 17, 2012, the subject assaulted the victim, based upon the victim’s actual and perceived race, color and national origin, which included Middle Eastern and Arab descent.  The defendant was arrested at the scene of the attack after a witness called 911.

The charge carries a statutory maximum of 10 years in prison.

The Shepard-Byrd law criminalizes acts of physical violence causing bodily injury motivated by any person’s actual or perceived race, color, national origin, religion, sexual orientation, gender, gender identity or disability.

The matter is being investigated by the Seattle Division of the FBI.  The case is being prosecuted by Assistant U.S. Attorney Bruce F. Miyake of the U.S. Attorney’s Office for the Western District of Washington and Trial Attorney Nicholas Durham of the U.S. Department of Justice’s Civil Rights Division.

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

The United States announced today that the Orange County, Fla., Sheriff’s Office (OCSO) has successfully implemented an agreement on the use of electronic control weapons, commonly referred to as Tasers. Significantly, data OCSO provided to the department demonstrates a marked decrease in the use of Tasers under Sheriff Jerry Demings’ tenure while implementing the department’s agreement. OCSO’s data also demonstrated an overall decrease in uses of force during the same period.

In 2010, the department and OCSO entered into a Memorandum of Agreement to ensure OCSO’s constitutional use of Tasers. The agreement set forth standards for Taser policies, training and reviews of Taser use. The department found that OCSO came into substantial compliance with the agreement in October 2011, and OCSO has maintained that compliance level for 18 months as required by the agreement.

“The successful resolution of our agreement with OCSO demonstrates that effective policing and constitutional policing go hand in hand. OCSO has heightened its standards on Taser use, reduced the use of Tasers, and also reduced its overall use of force, all while providing effective policing to the people of Orange County,” said Roy L. Austin Jr., Deputy Assistant Attorney General for the Civil Rights Division. “We are confident that OCSO has the systems in place to ensure constitutional use of Tasers going forward.”

In 2007, the department initiated an investigation of OCSO’s Taser use pursuant to the Violent Crime Control and Law Enforcement Act of 1994. The department issued a technical assistance letter to OCSO in August 2008 describing policies, training and accountability mechanisms necessary to ensure the constitutional use of Tasers.

The Violent Crime Control and Law Enforcement Act of 1994 prohibits state and local governments from engaging in a pattern or practice of misconduct by law enforcement officers that deprives individuals of federally-protected rights. The act also allows the Justice Department to remedy such misconduct through civil litigation. The Justice Department has conducted similar investigations and has obtained important reforms in police departments and law enforcement agencies across the country.

The Special Litigation Section of the Justice Department’s Civil Rights Division, in Washington, D.C., and the U.S. Attorney’s Office for the Middle District of Florida jointly conducted this investigation.

Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt . Additional information about the U.S. Attorney’s Office for the Middle District of Florida is available on its website at www.justice.gov/usao/flm .

A former contract employee of the U.S. Defense Department (DoD) was sentenced today to serve 35 months in prison for his participation in a bribery and money laundering scheme arising from corruption in the award of defense contracts at Camp Arifjan, an Army base in Kuwait, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division.

Wajdi Birjas, 41, of Evansville, Ind., was sentenced today by Chief U.S. District Judge Richard L. Young in the Southern District of Indiana.  In addition to his prison term, Birjas was sentenced to serve three years of supervised release and ordered to forfeit $650,000.

Birjas pleaded guilty on Aug. 11, 2010, to one count of bribery conspiracy and one count of money laundering conspiracy.

According to court documents, Birjas was a contract employee in the Host Nation Affairs office at Camp Arifjan between approximately 2004 and August 2007.  In this position, his responsibilities included translating documents, handling customs matters, and identifying Kuwaiti companies capable of providing certain goods and services to the U.S. military in Kuwait.  Through his work, Birjas had frequent contact with U.S. Army contracting officials, including officials who were regularly receiving unlawful payments from individuals who had contracts with, or were seeking contracts from, DoD.

According to court documents, Birjas, acting at the direction of a contractor working in Kuwait, developed corrupt relationships with certain U.S. Army contracting officials, including Sergeant First Class Richard Evick, who was deployed to Camp Arifjan as the senior procurement non-commissioned officer, Major Christopher Murray and Major James Momon.  By bribing these Army contracting officials in 2005 and 2006, Birjas assisted the contractor in obtaining a total of more than $1.7 million in connection with DoD contracts to provide various goods and services to the U.S. military.  In return, Birjas received a share of the profits that the contracts generated and was allowed to live rent-free in a villa in Kuwait that contained a hidden safe.

Court documents indicate that Birjas, among other things, paid Murray approximately $90,000; paid Evick approximately $22,000; and paid for Evick’s and Momon’s airplane and hotel expenses to allow them to celebrate New Year’s Eve in Dubai.  According to court documents, Birjas also allowed Momon to hide approximately $680,000 worth of his bribe money in Birjas’s safe at the villa.

Birjas admitted that, after Momon had returned to the United States at the end of his tour, Birjas agreed to assist Momon in arranging for $250,000 of Momon’s bribe money to be transferred from Kuwait to the United States.  Birjas admitted to working out the details of this agreement with Evick and one of Evick’s associates, Crystal Martin, a former master sergeant in the Army who operated a concession to sell clothing at U.S. military bases in Kuwait.  According to court documents, Birjas delivered approximately $85,000 worth of Momon’s bribe money to Martin for ultimate delivery to Momon in the United States.

The case against Birjas arose out of an investigation into corruption at the Army contracting office at Camp Arifjan, which has led to charges against 19 individuals, all of whom have pleaded guilty or been convicted at trial.

The case is being prosecuted by Trial Attorneys Peter C. Sprung, Edward J. Loya Jr., Eric G. Olshan and Timothy J. Kelly of the Criminal Division’s Public Integrity Section.  The case is being investigated by special agents of the DCIS, the Army Criminal Investigation Command Division, the FBI and the Special Inspector General for Iraq Reconstruction.

Doreen Alexander has been extradited to the United States from Trinidad and Tobago to face charges related to her alleged role in the 2005 kidnapping of naturalized U.S. citizen Balram “Balo” Maharaj, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and Michael B. Steinbach, Special Agent in Charge of the FBI’s Miami Field Office.

Alexander, 47, arrived in the United States on Sunday, March 31, 2013, and was arraigned yesterday before U.S. Magistrate Judge Deborah A. Robinson in the District of Columbia.  Alexander was charged in a two count indictment filed in September 2010.  If convicted, Alexander faces a maximum penalty of life in prison. She is presumed innocent until proven guilty beyond a reasonable doubt.

Alexander is the last charged co-conspirator involved in the alleged kidnapping of Maharaj, Alexander’s former boyfriend and father to one of her sons who died as a result of the kidnapping.  The other 12 co-conspirators were previously extradited and prosecuted by the U.S. Attorney’s Office for the District of Columbia. 

Alexander is alleged to have initiated the April 2005 kidnapping of Maharaj and provided information that allowed the kidnappers to identify, locate and track Maharaj.  Alexander allegedly alerted the kidnappers to Maharaj’s visits to Trinidad and Tobago, gave them information on his wealth, which was used to calculate the ransom, and reassured the kidnappers that they had the right man after the ransom negotiations went awry.

Valuable assistance was provided by the Criminal Division’s Office of International Affairs, which worked with its counterparts in Trinidad & Tobago to effect the extradition.  The U.S. Attorney’s Office for the District of Columbia has also provided significant assistance in this case. 

The case was investigated by the FBI’s Miami Division Extraterritorial Squad with the assistance of the FBI's Legal Attache's Office in Port of Spain, Trinidad and Tobago.  Special assistance was further provided by the Trinidad and Tobago Police Service Anti-Kidnapping Squad and Homicide Bureau.

The case is being prosecuted by Trial Attorneys Matthew Singer and Teresa Wallbaum of the Criminal Division’s Human Rights and Special Prosecutions Section. 

A federal jury in Detroit today convicted a home health agency owner and a physical therapist for their participation in a $2.3 million Medicare fraud scheme, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan; Robert D. Foley III, Special Agent in Charge of the FBI 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), Office of Investigations Detroit Office.
 
Mehran Javidan, 52, was found guilty in U.S. District Court for the Eastern District of Michigan of one count of conspiracy to commit health care fraud, three counts of health care fraud, three counts of making false statements related to health care matters, and one count of conspiracy to solicit or pay health care kickbacks in exchange for referrals of patients to a Detroit-area home health care company, Acure Home Care Inc.
 
Vishnu Meda, 32, a physical therapist, was found guilty of one count of conspiracy to commit health care fraud, two counts of health care fraud and two counts of making false statements relating to health care matters.
 
The jury found Javidan not guilty of one count of making false statements and one count of health care fraud, and did not reach a verdict on one additional count of health care fraud.  Meda was found not guilty of one count of making false statements and one count of health care fraud.
 
The defendants were charged in a superseding indictment returned Nov. 29, 2012.  Another individual charged in the indictment remains a fugitive.
 
According to evidence presented at trial, Javidan owned and operated Acure Home Care Inc., a home health care company in Oak Park, Mich., and later Troy, Mich.  As shown at trial,  Javidan paid doctors to refer non-homebound patients for physical therapy treatment that was medically unnecessary.  The evidence showed that she also paid patient recruiters to obtain Medicare information and pre-signed physical therapy documents from Medicare beneficiaries.  The recruiters for Acure obtained the Medicare information and pre-signed forms by paying patients in cash and by promising that the referring doctors would prescribe them narcotic prescriptions. 
 
Evidence presented at trial established that Meda and other physical therapists and physical therapy assistants employed by Acure created false and fraudulent physical therapy files using the blank, pre-signed forms to make it appear as if physical therapy services were actually rendered, when, in fact, the services had not been rendered. 
 
Acure was paid over $2.3 million from Medicare between December 2008 and November 2010.
 
The health care fraud conspiracy count carries a maximum potential penalty of 10 years in prison; each count of health care fraud carries a maximum penalty of 10 years in prison; each count of making false statements carries a maximum penalty of five years in prison; and each count of kickback conspiracy carries a maximum penalty of five years in prison.  Sentencing for both defendants is scheduled for July 8, 2013.
 
The case was prosecuted by Trial Attorneys Catherine K. Dick and Niall M. O’Donnell of the Criminal Division’s Fraud Section.  The investigation was led by the FBI and HHS-OIG, and was brought by the Medicare Fraud Strike Force, a joint effort of the U.S. Attorney’s Office for the Eastern District of Michigan and 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.

Jeffrey Charles, a resident of Grimstead, Va., was sentenced today to serve 46 months in federal prison for conspiring with his daughter and son-in-law to defraud the United States, aiding and assisting in the preparation of false tax returns in his daughter’s name, and filing a false tax return in his own name, the Justice Department and the Internal Revenue Service (IRS) announced.

On Nov. 6, 2012, following a six-day jury trial in Newport News, Va., Charles was convicted of one count of conspiracy, three counts of aiding and assisting in the preparation of false tax returns, and one count of filing a false tax return. According to the evidence presented at trial, Charles, a registered nurse and the administrator of a rehabilitation center, conspired with his daughter and son-in-law to impair and impede the IRS in ascertaining, computing, assessing and collecting federal income taxes. The evidence also proved that Charles aided and assisted in the preparation of three false tax returns in his daughter’s name for tax years 2000, 2001 and 2005, and attached false documents to each tax return. 

Finally, the evidence at trial also established that Charles filed a false tax return in his own name for tax year 2006 in which he allegedly falsely reported earning $0.00 income. Charles joined American Rights Litigators (ARL), a Florida-based organization, and paid ARL to send fraudulent documents to the IRS on his behalf and on behalf of his daughter. In August 2004, a federal district judge permanently enjoined ARL and two of its promoters from the sale of a nationwide tax scam. In August of 2010, three promoters of ARL were each sentenced in the District of Columbia to 10 years in prison along with ARL founder Eddie Ray Kahn, who received a 20 year sentence.

Senior Judge Henry Coke Morgan Jr. also ordered Charles to pay over $300,000 in restitution to the IRS as part of his sentence.

In a separate but related case, Charles’s co-conspirators, his daughter and son-in-law Kathryn Miles and John Miles, each pleaded guilty to conspiracy and were sentenced to federal prison.

Assistant Attorney General Kathryn Keneally for the Justice Department’s Tax Division commended the investigative efforts of special agents of IRS Criminal Investigation, and Tax Division Trial Attorney Justin K. Gelfand and Assistant U.S. Attorney Brian Samuels, who prosecuted the case.

The Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today that Dominion Energy has agreed to pay a $3.4 million civil penalty and spend approximately $9.8 million on environmental mitigation projects to resolve Clean Air Act (CAA) violations. The settlement will result in reductions of nitrogen oxides, sulfur dioxide and particulate matter by more than 70,000 tons per year, across three of the utility’s coal-fired power plants, located in Kincaid, Ill., State Line, Ind., and Somerset, Mass.

“This settlement will improve air quality in states in the Midwest and Northeast by eliminating tens of thousands of tons of harmful air pollution each year,” said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.  “These reductions mark the latest step in our continuing efforts, along with EPA, to protect public health and the environment through rigorous enforcement of the Clean Air Act.”

“Today’s settlement substantially reduces harmful pollution from coal-fired power plants in and around communities with significant air pollution concerns,” said Cynthia Giles, Assistant Administrator for the EPA’s Office of Enforcement and Compliance Assurance. “Along with the pollution reductions at the three power plants covered by the agreement, the settlement also requires Dominion to invest over $9 million in pollution reducing projects in neighboring communities.”

Under the settlement, Dominion must install or upgrade pollution control technology on two plants, and permanently retire a third plant. Dominion will be required to  operate the new and existing pollution controls continuously, and will be required to comply with stringent emission rates and annual tonnage limitations. The actions taken by Dominion to comply with this settlement will result in annual reductions at the Brayon Point and Kincaid plants of sulfur dioxide (SO2) and nitrogen oxides (NOx) emissions by 52,000 tons from 2010 levels. The retirement of the State Line plant will result in an additional reduction of 18,000 tons of SO2 and NOx.

The settlement also requires Dominion to spend $9.75 million on projects that will benefit the environment and human health in communities located near the Dominion facilities.  A total of $9 million will be spent on such projects as: 1) wood stove changeouts, including $2 million for changeouts in southeastern Massachusetts, Rhode Island and eastern Connecticut;  2) switcher locomotive idle reduction for Chicago rail yards; 3) land acquisition and restoration adjacent to, or near, the Indiana Dunes National Lakeshore; 4) energy efficiency and geothermal/solar projects for local schools and food banks; and 5) clean diesel engine retrofits for municipalities and school districts.  Dominion must also pay a total of $750,000 to the U.S. Forest Service and the National Park Service, to be used on projects to address the damage resulting from Dominion’s alleged excess emissions.  

Reducing air pollution from the largest sources of emissions, including coal-fired power plants, is one of EPA’s National Enforcement Initiatives for 2011-2013. SO2 and NOx, two key pollutants emitted from power plants, have numerous adverse effects on human health and are significant contributors to acid rain, smog and haze. These pollutants are converted in the air to fine particles that can cause severe respiratory and cardiovascular impacts, and premature death. Reducing these harmful air pollutants will benefit the communities located near Dominion facilities, particularly communities disproportionately impacted by environmental risks and vulnerable populations, including children. Because air pollution from power plants can travel significant distances downwind, this settlement will also reduce air pollution outside the immediate region.

This judicial settlement is secured as part of a national enforcement initiative to control harmful emissions from power plants under the CAA’s New Source Review requirements. The total combined sulfur dioxide and nitrogen oxides emission reductions secured from all power plant settlements to date will exceed nearly 2 million tons each year once all the required pollution controls have been installed and implemented.

The settlement was lodged today in the U.S. District Court for the Central District of Illinois, and is subject to a 30-day public comment period and final court approval. The settlement can be viewed at www.justice.gov/enrd/Consent_Decrees.html

More information about the settlement: www.epa.gov/enforcement/air/cases/dominionenergy.html

More information about EPA’s national enforcement initiative: www.epa.gov/compliance/data/planning/initiatives/2011airpollution.html

A patient recruiter for a Miami health care company was sentenced today to serve 36 months in prison for his participation in a $20 million home health 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 Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.

Vladimir Jimenez, 43, was sentenced by U.S. District Judge Joan A. Lenard in the Southern District of Florida.  In addition to his prison term, Jimenez was sentenced to serve two years of supervised release and ordered to pay $950,000 in restitution, jointly and severally with co-defendants.

In January 2013, Jimenez pleaded guilty to one count of conspiracy to receive health care kickbacks.

According to court documents, Vladimir Jimenez 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 approximately March 2009, Jimenez recruited patients for Serendipity, and in doing so solicited and received kickbacks and bribes from the owners and operators of Serendipity in return for allowing Serendipity to bill the Medicare program on behalf of the patients Jimenez had 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. Medicare actually paid approximately $14 million for these fraudulent claims.

As a result of Jimenez’s participation in the illegal scheme, the Medicare program was fraudulently billed more than $400,000 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, following guilty pleas in March 2012 to one count each of 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.

The owner and the director of nursing of a Louisiana home health agency were each convicted late Friday for conspiring to defraud Medicare of $17.1 million announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Donald J. Cazayoux Jr. of the Middle District of Louisiana; Mike Fields, Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Dallas regional office; Michael Anderson, Special Agent in Charge of the FBI’s New Orleans Division; and Louisiana State Attorney General James Buddy Caldwell.

After a six-day trial, Louis T. Age, Jr., 64, and Verna S. Age, 60, both of Slidell, La., were each convicted by a federal jury in the Middle District of Louisiana of one count of conspiracy to commit health care fraud.  Louis Age was also convicted of one count of conspiracy to defraud the United States and to pay and receive illegal health care kickbacks.  Verna Age was previously convicted in this case of one count of conspiracy to defraud the United States and to pay and receive illegal health care kickbacks. 

Louis Age owned South Louisiana Home Health Care Inc. and operated this company along with his former wife, Verna Age, who served as the company’s director of nursing.  According to evidence presented at trial, Louis and Verna Age paid recruiters, including Mary L. Johnson, to obtain Medicare beneficiary information.  The evidence showed that Louis Age hired and paid medical doctors, including Michael S. Hunter, to sign referrals and certifications for home health services that were not medically necessary.  As a registered nurse and director of nursing for South Louisiana Home Health Care, Verna Age falsified and directed others to falsify certification evaluations and other forms to make it appear that the home health services were medically necessary. 

Evidence at trial showed that South Louisiana Home Health Care fraudulently billed Medicare for home health care claims and was paid $17.1 million between 2005 and 2011.

At trial, Ayanna Age Alverez, who previously pleaded guilty in this case, testified that she was trained by her father, Louis Age, and her stepmother, Verna Age, to pay recruiters kickbacks to recruit beneficiaries, to falsify patient files and to pay doctors kickbacks for their signatures on home health certifications.  Medicare beneficiaries testified that they did not need the services that South Louisiana Home Health Care billed to Medicare.

Age Alverez, Johnson and Hunter have pleaded guilty in this case and await sentencing.  Co-defendant Milton L. Womack, who was also charged in the August 2011 indictment, died in July 2012.
 
Sentencing dates for Louis and Verna Age have not yet been scheduled.  The conspiracy to commit health care fraud count carries a maximum potential penalty of 10 years in prison and a $250,000 fine, and the conspiracy to pay health care kickbacks carries a maximum penalty of five years in prison and a $250,000 fine.

The case was prosecuted by Trial Attorneys David Maria and Abigail Taylor of the Criminal Division’s Fraud Section, with assistance from Trial Attorney Arunabha Bhoumik of the Criminal Division’s Fraud Section. The case was investigated by the FBI, HHS-OIG and the Medicaid Fraud Control Unit of the Louisiana State Attorney General’s Office.   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 Middle District of Louisiana.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged 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.

The Justice Department announced today that the Civil Rights Division will monitor elections on April 2, 2013, in Finney County, Kan., and Douglas County, Neb. The monitoring will ensure compliance with the Voting Rights Act of 1965 and other federal voting rights statutes.  The Voting Rights Act prohibits discrimination in the election process on the basis of race, color or membership in a minority language group.

Justice Department personnel will monitor polling place activities in Finney and Douglas Counties.  Civil Rights Division attorneys will coordinate federal activities and maintain contact with local election officials.

Each year, the Justice Department deploys hundreds of federal observers from the Office of Personnel Management, 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.

A former U.S. Army Captain was sentenced today in Oklahoma City to serve 23 months in prison for conspiracy to accept thousands of dollars in gratuities from contractors during his deployment to Baghdad, Iraq, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney for the Western District of Oklahoma Sanford C. Coats.

Sean Patrick O’Brien, 38, of Lawton, Okla., was sentenced by U.S. District Judge Stephen P. Friot in the Western District of Oklahoma.  In addition to his prison term, O’Brien was sentenced to serve three years of supervised release and ordered to pay $37,500 in restitution to the United States. 

 O’Brien pleaded guilty on Nov. 9, 2012, to a criminal information charging him with two counts of conspiracy to accept illegal gratuities.

According to court documents, O’Brien, formerly a commissioned officer in the U.S. Army, assisted in the contracting process of U.S. government funds, and was therefore considered a public official.  It is a violation of federal law for officers to accept gratuities from contractors dependent upon them for contracts.

 According to court documents, from mid-2008 through January 2009, O’Brien, with the assistance of two alleged co-conspirators, unlawfully sought, received and accepted illegal gratuities for helping Iraqi contractors in connection with U.S. government.  O’Brien accepted approximately $37,500 in cash payments and jewelry while stationed in Iraq, which he has repatriated to the United States.  One of the alleged co-conspirators also offered O’Brien a vacation to a private island.

This case was prosecuted by Assistant U.S. Attorney Scott E. Williams of the Western District of Oklahoma and by Special Trial Attorney Mark Grider of the Justice Department Criminal Division’s Fraud Section, on detail from the Special Inspector General for Iraq Reconstruction (SIGIR).  The case was investigated by the Defense Criminal Investigative Service, the Major Procurement Fraud Unit of the U.S. Army Criminal Investigation Command, and SIGIR.

An indictment against former Jefferson Parish, La., Sheriff’s Deputy Mark Hebert, 48, was announced today by Roy L. Austin Jr., Deputy Assistant Attorney General for the Civil Rights Division; Dana J. Boente, Acting U.S. Attorney for the Eastern District of Louisiana; Michael J. Anderson, Special Agent in Charge of the FBI New Orleans Field Office; and Sheriff Newell Normand from the Jefferson Parish Sheriff’s Office.

According to the indictment, Hebert engaged in a scheme to defraud J.P. Morgan Chase Bank from Aug. 2, 2007, until Nov. 21, 2007. The scheme began when Hebert, in his capacity as a Jefferson Parish Sheriff’s Deputy, responded to an automobile accident involving Albert Bloch and stole, among other things, Bloch’s Visa debit card. The indictment alleges that Hebert then used that debit card to make unauthorized purchases of merchandise and to withdraw funds from Bloch’s Chase Bank account using ATMs. After Chase Bank cancelled the debit card due to Bloch filing a dispute with the bank, Hebert continued his scheme to defraud by negotiating and attempting to negotiate forged checks drawn on Bloch’s Chase Bank account. It is also alleged that Hebert obtained the replacement debit card that Chase Bank sent to Bloch and used that card to make unauthorized transactions at ATMs.

The indictment charges that Hebert, while acting under color of law, deprived Bloch of his constitutional rights by seizing and converting funds that Bloch had on deposit with Chase Bank. In addition, the indictment alleges that Hebert committed 48 counts of bank fraud from Aug. 2, 2007, to Nov. 21, 2007. The indictment also charges Hebert with four counts of computer fraud for accessing the National Crime Information Center to obtain non-public information about Bloch in furtherance of his scheme to defraud. Furthermore, Hebert is charged with two counts of aggravated identity theft for using a means of identification of Bloch during, and in relation to, the bank fraud violations. Finally, Hebert is charged with five counts of obstruction of justice for knowingly concealing and covering up physical evidence with the intent to impede any investigation into the underlying criminal allegations against Hebert.

For each of the 48 counts of bank fraud, Hebert faces a statutory maximum term of imprisonment of 30 years . For each of the five counts of obstruction of justice, Hebert faces a statutory maximum term of 20 years in prison. For each of the four counts of computer fraud, Hebert faces a statutory maximum term of five years in prison. For each of the two counts of aggravated identity theft, Hebert faces a term of two years in prison. For the count charging a civil rights violation, Hebert faces a statutory maximum penalty of one year in prison .

An indictment is merely a charge and the defendant is presumed innocent unless proven guilty beyond a reasonable doubt.

The investigation was conducted by the Jefferson Parish Sheriff’s Office Detective’s Bureau and the FBI. The case is being prosecuted by Assistant U.S. Attorney Steve Parker and Civil Rights Division Trial Attorney Shan Patel.