District Not Recorded

A Brookville, New York, man pleaded guilty today to willfully failing to collect and pay over employment taxes to the IRS on behalf of the spa companies he owned and managed.

According to court documents and statements made in court, Sung Soo Chon, 63, aka Steve Chon, was the CEO, president and majority owner of Spa Castle Queens in College Point, New York, and Spa Castle Texas, in Carrolton, Texas. Chon oversaw daily operations at the two spas and related businesses, and directed subordinates to pay cash wages to some employees, many of whom were not legally permitted to work in the United States.

From the first quarter of 2014 through the first quarter of 2017, Chon did not withhold all of the legally required federal payroll taxes from the wages of some of the spa employees and filed false employment tax returns with the IRS. During this period, Chon caused the businesses to conceal more than $1.3 million in cash wages. In total, the spa companies did not pay $199,238 in payroll taxes due to the IRS.

Chon is scheduled to be sentenced on Dec. 6. He faces a maximum penalty of five years prison, as well as a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Breon Peace for the Eastern District of New York made the announcement.

IRS-Criminal Investigation is investigating the case.

Assistant Chief Jorge Almonte and Trial Attorney Ann M. Cherry of the Tax Division are prosecuting the case.

A California man was extradited from Mexico on March 8 and pleaded guilty today to conspiracy to commit mail fraud and wire fraud, mail fraud, and money laundering charges for two high-yield investment fraud schemes.

According to court documents, Daniel Thomas Broyles Sr., aka Dan Thomas, aka Daniel Cruz Torrez, 64, of Malibu, participated in a high-yield investment fraud scheme involving a sham company named Niyato Industries Inc. Broyles admitted to conspiring with Niyato’s CEO, Robert Leslie Stencil, 65, of Charlotte, North Carolina, and others to defraud Niyato investors. Broyles admitted that, together with Stencil and others, he falsely portrayed Niyato as a business engaged in electric vehicle manufacturing and converting vehicles to run on compressed natural gas. In reality, Broyles knew, or intentionally avoided learning, that Niyato was merely a sham company that lacked any operational facilities or proprietary technology, and virtually all investor funds were being disbursed among the co-conspirators and not used to promote Niyato’s business. In June 2016, after Broyles learned that federal law enforcement agents were investigating Niyato, he relocated to Mexico. Broyles admitted that, when he learned in August 2016 that he had been indicted, he moved to a new address in Mexico and began using the alias “Daniel Cruz Torrez” to hide from federal law enforcement agents and to obstruct the federal government’s prosecution.

In addition, according to court documents, Broyles separately pleaded guilty for his role in a second high-yield investment fraud involving EarthWater Limited. Broyles admitted to conspiring with EarthWater’s CEO, Cengiz Jan Comu, 61, of Dallas, Texas, and others to sell EarthWater stock. Broyles also admitted that he and others made numerous false and misleading representations, including that EarthWater used the money raised from victim investors to develop and operate the company’s business. In truth, Broyles, Comu, and their co-conspirators had agreed to use the invested victim funds largely for their personal benefit.

Broyles pleaded guilty to one count of conspiracy to commit mail fraud and wire fraud, one count of mail fraud, and one count of money laundering in connection with the Niyato scam. Broyles also pleaded guilty to one count of conspiracy to commit mail fraud and wire fraud in connection with the EarthWater scheme. He is scheduled to be sentenced at a later date. Broyles faces up to 10 years in prison for the money laundering count, up to 20 years in prison for the mail fraud count, and up to 30 years in prison for each of the conspiracy counts. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Seven other defendants have previously been convicted in connection with the Niyato scam, including Stencil, who was convicted following a three-week jury trial and sentenced to 135 months in prison. 

Eight other defendants have pleaded guilty in connection with the EarthWater fraud, including Comu, who is scheduled to be sentenced on Sept. 7. Three other defendants are awaiting trial in the EarthWater case on charges set forth in a superseding indictment filed on Nov. 6, 2019, in the Northern District of Texas. The trial is scheduled to begin on Oct. 3.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Dena J. King for the Western District of North Carolina; U.S. Attorney Chad E. Meacham for the Northern District of Texas; Inspector in Charge Tommy Coke of the U.S. Postal Inspection Service’s Atlanta Division; and Inspector in Charge Eric Shen of the U.S. Postal Inspection Service’s Criminal Investigations Group made the announcement.

The Government of Mexico, including the Fiscalia General de la Republica (FGR), provided significant assistance in the extradition of Broyles to the United States. The Justice Department’s Office of International Affairs also provided substantial assistance in securing the arrest and extradition of Broyles.

The U.S. Postal Inspection Service is investigating this case. The U.S. Marshals Service transported Broyles from Mexico to the United States.

Trial Attorney Christopher Fenton of the Criminal Division’s Fraud Section is prosecuting both cases. Trial Attorney Theodore Kneller of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Mary Walters of the U.S. Attorney’s Office for the Northern District of Texas are prosecuting the case involving EarthWater.

In a second superseding indictment unsealed today, a federal grand jury in Cleveland, Ohio, charged Christos Karasarides Jr., of Canton, with tax evasion, filing false tax returns, witness tampering, falsifying records and five separate conspiracies to operate illegal gambling businesses, defraud the IRS and commit money laundering.

In May 2021, the government charged spouses Jason Kachner and Rebecca Kachner, CPA Ronald DiPietro and Thomas Helmick with conspiring to operate illegal gambling businesses and to defraud the IRS, among other criminal offenses. The superseding indictment unsealed today adds Karasarides to the indictment and includes new tax charges against DiPietro.

According to the second superseding indictment, from 2010 through 2018 Karasarides, Jason Kachner, Rebecca Kachner and DiPietro conspired to operate Skilled Shamrock, an illegal gambling business in Canton, and conspired to defraud the IRS by concealing income generated by Skilled Shamrock. From 2012 through 2017, patrons at Skilled Shamrock allegedly wagered a total of more than $34 million, which resulted in more than $4 million in net income for the owners of the gambling business.

The second superseding indictment also charges that from 2009 through 2013, Karasarides accrued a total of more than $1.4 million in taxes owed to the IRS. Karasarides and DiPietro sought to evade this tax debt by allegedly submitting false information to the IRS concealing Karasarides’ ownership of the illegal gambling businesses and the income derived from those businesses. Instead of paying his overdue tax debt, Karasarides allegedly spent millions of dollars in cash on personal items such as cars, country club dues, real estate and credit card payments for the benefit of family members.

With DiPietro’s help, Karasarides also allegedly filed false tax returns with the IRS for 2013 through 2016. The returns allegedly did not include all the income Karasarides earned from Skilled Shamrock and other gambling businesses. Additionally, DiPietro is charged with helping the Kachners file their own false tax returns for the years 2013 through 2017. The Kachners and Helmick were previously charged with conspiracy and filing false tax returns that allegedly underreported gross receipts received from Redemption Skill Games 777, one of the other gambling businesses.

During the investigation, Karasarides allegedly sought to tamper with a witness appearing before the grand jury. He also allegedly had false promissory notes created to authenticate purported loans, then directed business associates and his son to sign the false promissory notes. When Karasarides learned one of the business associates had been subpoenaed to testify before the grand jury, he allegedly directed that witness to falsely testify that his loan was legitimate.

Karasarides is also charged with conspiring to launder money because he allegedly disguised the final payment on his personal residence, funded with cash proceeds from his illegal gambling businesses, by providing the cash to his associate who agreed to form a company to make the payment so that, on paper, Karasarides would never pay down the principal and purchase the residence outright.

Karasarides made his initial court appearance today. If convicted, he faces a maximum penalty of five years in prison for each count of conspiracy to operate an illegal gambling business and conspiracy to defraud the IRS, five years in prison for tax evasion, three years in prison for filing a false tax return, and 20 years in prison for each count of conspiracy to launder money, witness tampering and falsification of records. DiPietro faces a maximum penalty of five years in prison for helping Karasarides evade taxes and three years in prison for helping Karasarides file a false tax return. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and First Assistant U.S. Attorney Michelle Baeppler for the Northern District of Ohio made the announcement.

IRS-Criminal Investigation, the U.S. Department of Treasury Office of Inspector General, and the Ohio Casino Control Commission are investigating the case. Homeland Security Investigations provided substantial assistance.

Trial Attorneys Richard M. Rolwing and Sam Bean of the Tax Division and Assistant U.S. Attorneys Robert Patton and David Toepfer for the Northern District of Ohio are prosecuting the case.  

An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Attorney General Merrick B. Garland today released the following statement following the Supreme Court’s decision in Dobbs, State Health Officer of the Mississippi Department of Health, et al. v. Jackson Women’s Health Organization et al.:

“Today, the Supreme Court overturned Roe v. Wade and Planned Parenthood v. Casey and held that the right to abortion is no longer protected by the Constitution.

“The Supreme Court has eliminated an established right that has been an essential component of women’s liberty for half a century – a right that has safeguarded women’s ability to participate fully and equally in society. And in renouncing this fundamental right, which it had repeatedly recognized and reaffirmed, the Court has upended the doctrine of stare decisis, a key pillar of the rule of law.

“The Justice Department strongly disagrees with the Court’s decision. This decision deals a devastating blow to reproductive freedom in the United States. It will have an immediate and irreversible impact on the lives of people across the country. And it will be greatly disproportionate in its effect – with the greatest burdens felt by people of color and those of limited financial means. 

***

“But today’s decision does not eliminate the ability of states to keep abortion legal within their borders. And the Constitution continues to restrict states’ authority to ban reproductive services provided outside their borders.

“We recognize that traveling to obtain reproductive care may not be feasible in many circumstances. But under bedrock constitutional principles, women who reside in states that have banned access to comprehensive reproductive care must remain free to seek that care in states where it is legal. Moreover, under fundamental First Amendment principles, individuals must remain free to inform and counsel each other about the reproductive care that is available in other states.

“Advocates with different views on this issue have the right to, and will, voice their opinions. Peacefully expressing a view is protected by the First Amendment. But we must be clear that violence and threats of violence are not. The Justice Department will not tolerate such acts.

***

“The Justice Department will work tirelessly to protect and advance reproductive freedom.

“Under the Freedom of Access to Clinic Entrances Act, the Department will continue to protect healthcare providers and individuals seeking reproductive health services in states where those services remain legal. This law prohibits anyone from obstructing access to reproductive health services through violence, threats of violence, or property damage. 

“The Department strongly supports efforts by Congress to codify Americans’ reproductive rights, which it retains the authority to do. We also support other legislative efforts to ensure access to comprehensive reproductive services.

“And we stand ready to work with other arms of the federal government that seek to use their lawful authorities to protect and preserve access to reproductive care. In particular, the FDA has approved the use of the medication Mifepristone. States may not ban Mifepristone based on disagreement with the FDA’s expert judgment about its safety and efficacy. 

“Furthermore, federal agencies may continue to provide reproductive health services to the extent authorized by federal law. And federal employees who carry out their duties by providing such services must be allowed to do so free from the threat of liability. It is the Department’s longstanding position that States generally may not impose criminal or civil liability on federal employees who perform their duties in a manner authorized by federal law. Additionally, the Department’s Office of Legal Counsel has determined that federal employees engaging in such conduct would not violate the Assimilative Crimes Act and could not be prosecuted by the federal government under that law. The Justice Department is prepared to assist agencies in resolving any questions about the scope of their authority to provide reproductive care.

***

“The ability to decide one’s own future is a fundamental American value, and few decisions are more significant and personal than the choice of whether and when to have children.

“Few rights are more central to individual freedom than the right to control one’s own body.

“The Justice Department will use every tool at our disposal to protect reproductive freedom. And we will not waver from this Department’s founding responsibility to protect the civil rights of all Americans.”

Download Hindi Press Release Translation.pdf

वॉल िंगटन – न्याय लवभाग ने आज यह घोषणा की लक उन्ोिंने SpringShine Consulting, Inc., कै ललफोलनिया में स्थित एक IT स्टालफिं ग किं पनी, के साि समाधान समझौते पि हस्ताक्षि लकए। यह समझौता इन दावोिं का समाधान किता है लक SpringShine ने उस समय अमेरिकी कमिचारियोिं के साि उनकी नागरिकता स्थिलत के आधाि पि भेदभाव लकया िा जब उन्ोिंने के वल अथिायी कायि वीज़ा के ललए प्रायोजन की मािंग कि िहे लोगोिं से िोज़गाि के अवसिोिं के ललए आवेदन मािंगे िे।

"जो लनयोक्ता आवेदकोिं को उनकी नागरिकता या आप्रवासन स्थिलत के आधाि पि हतोत्सालहत किते हैं, या के वल उन्ीिं आवेदकोिं के ललए िोज़गाि के कु छ अवसिोिं को सुिलक्षत िखते हैं लजन्ें युनाइटेड स्टेट्स में काम किने के ललए प्रायोजन की आवश्यकता है, वे कानून का उल्लिंघन किते हैं औि उन्ें जवाबदेह ठहिाया जाना चालहए," न्याय लवभाग के नागरिक अलधकाि प्रभाग के सहायक अटॉनी जनिल लिस्टन क्लाकि ने कहा। "नागरिक अलधकाि प्रभाग यह सुलनलित किेगा लक कमिचारियोिं को इस तिह के गैि- कानूनी भेदभाव से बचाया जाए।"

SpringShine द्वािा एक भती वेबसाइट पि पोस्ट लकए गए लवज्ञापन के बािे में एक व्यस्क्त द्वािा ल कायत किने के बाद लवभाग ने जााँच ुरू की, लजसमें के वल ऐसे अनुभवी IT किं सल्टेंट्स से आवेदन आमिंलित लकए गए िे, लजन्ें िोज़गाि-आधारित अथिायी कायि वीज़ा के ललए प्रायोजन की आवश्यकता िी। वह लवज्ञापन लव ेष रूप से किं पनी के H-1B वीज़ा प्रायोजन की मािंग किने वाले कमिचारियोिं पि लनदेल त िा, लजसमें इसका कोई सिंके त नहीिं िा लक अन्य नागरिकता स्थिलतयोिं वाले कमिचारियोिं पि भी िोज़गाि के अवसि के ललए लवचाि लकया जाएगा, जैसे अमेरिकी नागरिक, मूल अमेरिकी लनवासी, वैध थिायी लनवासी, िणािी या िेफ्युजी। SpringShine ने दावा लकया िा लक लवज्ञापन िोज़गाि की पे क से जुडा नहीिं िा, बस्ि वह के वल उसके क्लाइिंट्स की अनुमालनत भावी श्रलमक आवश्यकताओिं को पूिा किने हेतु योग्य किं सल्टेंट्स का समूह तैयाि किने के ललए एक रििू लटिंग टू ल िा। हालािंलक, अपनी जााँच के आधाि पि लवभाग इस लनष्कषि पि पहाँचा लक (1) किं पनी ने पोस्स्टिंग का जवाब देने वाले आवदेकोिं में से एक को प्रायोलजत किने की पे क की िी, (2) लवज्ञापन में SpringShine द्वािा अपनी भती-सिंबिंधी आवश्यकताओिं को पूिा किने के ललए H-1B वीज़ा वाले कमिचारियोिं को प्रािलमकता देना द ािया गया है, औि (3) पोस्स्टिंग ने कई लोगोिं को लवचाि के ललए आवेदन किने से गैि-कानूनी रूप से िोककि अमेरिकी कमिचारियोिं को नुकसान पहाँचाया िा। आप्रवासन औि िाष्ट्रीयता अलधलनयम (Immigration and Nationality Act, INA) के तहत, आम तौि पि लनयोक्ताओिं को भती किने या नौकिी देनेमें नागरिकता स्थिलत के आधाि पि भेदभाव किने की अनुमलत नहीिं है।

समाधान समझौते की तों के तहत, SpringShine युनाइटेड स्टेट्स को नागरिक दिंड में $17,000 का भुगतान किेगी औि यह सुलनलित किेगी लक वह अपने िोज़गाि लवज्ञापनोिं औि नौकिी देने की कायिप्रणाललयोिं में लकसी लव ेष नागरिकता या आप्रवासन स्थिलत वाले आवेदकोिं के ललए लकसी भी गैि- कानूनी प्रािलमकता को ालमल या लागू नहीिं किती। इसके अलतरिक्त, SpringShine भती किने औि नौकिी देने में ालमल कमिचारियोिं को INA के भेदभाव-लविोधी प्रावधान में प्रल लक्षत किेगी।

नागरिक अलधकाि प्रभाग का अप्रवासी औि कमिचािी अलधकाि अनुभाग (Immigrant and Employee Rights Section, IER) INA के भेदभाव-लविोधी प्रावधान को लागू किने के ललए लज़म्मेदाि है। यह कानून नौकिी देने, नौकिी से लनकालने या ुि लेकि भती किने या िेफिल में नागरिकता स्थिलत औि िाष्ट्रीय मूल; अनुलचत दस्तावेज़ी कायिप्रणाललयोिं; औि प्रलत ोध औि डिाने-धमकानेके आधाि पि भेदभाव को प्रलतबिंलधत किता है।

इस सिंलक्षप्त वीलडयो के माध्यम से IER के कायि औि सहायता प्राप्त किने के तिीके के बािे में औि जानें। IER की वेबसाइट पि इस बािे में अलधक जानकािी प्राप्त किें लक लनयोक्ता नागरिकता स्थिलत सिंबिंधी भेदभाव से कै से बच सकते हैं। वे आवेदक या कमिचािी जो यह मानते हैं लक नौकिी देने, नौकिी से लनकालने, भती किने, या िोज़गाि योग्यता सत्यापन प्रलिया (फॉमि I-9 औि ई-वेरिफाई) के दौिान उनकी नागरिकता, आप्रवासन स्थिलत, या िाष्ट्रीय मूल के आधाि पि भेदभाव लकया गया िा; या बदला ललया गया िा, वे आिोप दायि कि सकते हैं। आम लोग भी 1-800-255-7688 (1-800-237-2515, सुनने में पिे ानी वालोिं के ललए TTY) पि IER की कमिचािी हॉटलाइन पि फोन कि सकते हैं; 1-800-255-8155 (1-800-237-2515, सुनने में पिे ानी वालोिं के ललए TTY) पि IER की लनयोक्ता हॉटलाइन पि फोन कि सकते हैं; IER@usdoj.gov पि ईमेल कि सकते हैं; एक मुफ़्त वेलबनाि के ललए साइन-अप कि सकते हैं; या IER की अिंग्रेज़ी औि स्पेलन वेबसाइट्स देख सकते हैं। IER से अपडेट प्राप्त किने के ललए GovDelivery को सब्सिाइब किें।

Today, Deputy Attorney General (DAG) Lisa O. Monaco traveled to Philadelphia to highlight the Department of Justice’s ongoing efforts to combat violent crime and gun violence through strong federal and local law enforcement partnerships and collaboration with community-based organizations.  

DAG Monaco began her day at the U.S. Attorney’s Office for the Eastern District of Pennsylvania with a roundtable meeting of state, local and federal law enforcement leaders to discuss the strong partnerships that Philadelphia area law enforcement are using to tackle violent crime and gun violence. The DAG was joined by leaders from the Justice Department law enforcement components in the area, representatives of the Pennsylvania State Police, Philadelphia Police Commissioner Danielle Outlaw and other representatives of the Philadelphia Police Department and Chief of the Wilmington, Delaware Police Department Robert Tracy. Their conversation focused on the successful intelligence-sharing behind law enforcement’s targeting of the most significant drivers of violent crime in the Greater Philadelphia Area.

The DAG also convened a separate roundtable discussion with community advocates, survivors of gun violence, families who have lost loved ones to gun violence and medical experts to discuss the impact of gun violence on local Philadelphia communities. During the discussion, the DAG heard personal and painful stories from parents whose children were killed by gun violence, who now devote their time to speaking directly with other parents, young adults and children to interrupt the cycle of violence in communities. 

While at the U.S. Attorney’s Office, the DAG met with U.S. Attorney Jacqueline Romero, who was sworn in earlier this week, and office leadership to discuss a variety of issues. The DAG also had a chance to hear from and thank the federal prosecutors of the Eastern District of Pennsylvania.

The DAG then joined the Philadelphia Police Department for a ride-along through several neighborhoods in the city to witness both the impact of drug use and violent crime, as well as community policing strategies and collaborative partnerships to better understand neighborhood trends and needs, rebuild community trust, and target the most significant drivers of violent crime. On the ride-along, the DAG had the chance to meet with several Philadelphia Police Department officers who are working foot and bike patrols through local neighborhoods every day.

In the evening, DAG Monaco returned to Washington, D.C.

A federal grand jury in the Northern District of Georgia returned an indictment charging military contractors with an alleged fraud scheme involving government contracts totaling over $7 million.

The three-count indictment charges Envistacom LLC, its President Alan Carson and a vice president Valerie Hayes, and the owner of another company, Philip Flores, each with one count of conspiracy to defraud the United States and two counts of major fraud.

“Collusion and fraud undermine competition in the procurement process to the detriment of U.S. taxpayers,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “Investigating and prosecuting criminal activity remains a top priority for the Department of Justice and all members of the Procurement Collusion Strike Force.”

“The United States relies upon its contractors to be honest and forthright in their dealings,” said U.S. Attorney Ryan K. Buchanan for the Northern District of Georgia. “When they allegedly provide false information to obtain contracts, they harm the American taxpayer and the integrity of the system. We will diligently work to bring such companies and their executives to justice.”

“The indictment of these individuals demonstrates the resolve and dedication of the Defense Criminal Investigative Service and our investigative partners in protecting the integrity of the Department of Defense contracting system,” said Special Agent in Charge Cynthia A. Bruce, Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Southeast Field Office. “Contractors who circumvent the contracting process for their own personal gain will be thoroughly investigated and held accountable for their fraudulent actions.”

“Such alleged activity by government contractors who provide services to the Army will not be tolerated,” said Special Agent in Charge L. Scott Moreland of the U.S. Army Criminal Investigation Division’s (Army CID) Major Procurement Fraud Field Office. “We will continue to investigate allegations of this nature and do everything in our power to see that persons responsible are held accountable and brought to justice.”

According to the indictment, from at least September 2014 through at least November 2016, the defendants and others conspired by preparing and procuring purported “competitive quotes” from other companies, which were sham quotes that were intentionally higher than the proposal prices and/or price quotes from Envistacom and Flores’ company to ensure the sole-source awards. The conspirators also concealed that the defendants prepared the independent government cost estimates and other procurement documents for the award of these contracts and made false statements, representations and material omissions to federal government contracting officials regarding these estimates being legitimate independent cost estimates and the sham quotes being “competitive.”

The maximum penalty for conspiracy to defraud the United States is five years in prison and a fine of $250,000. The maximum penalty for major fraud is 10 years in prison and a fine of $1 million, or, if the gross loss to the government or the gross gain to a defendant is $500,000 or greater, a fine of $5 million. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other relevant factors.

The charges are the result of a federal investigation conducted by the Antitrust Division’s Washington Criminal II Section, the U.S. Attorney’s Office for the Northern District of Georgia, Army CID and DCIS.

Anyone with information in connection with this investigation should contact the Antitrust Division’s Complaint Center at 888-647-3258, or visit http://www.justice.gov/atr/report-violations.

In November 2019, the Department of Justice created the Procurement Collusion Strike Force (PCSF), a joint law enforcement effort to combat antitrust crimes and related fraudulent schemes that impact government procurement, grant, and program funding at all levels of government – federal, state and local. To learn more about the PCSF, or to report information on market allocation, price fixing, bid rigging and other anticompetitive conduct related to defense-related spending, go to https://www.justice.gov/procurement-collusion-strike-force.

An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The Department of Justice today released the following statement from spokeswoman Dena Iverson following the Supreme Court’s decision in New York State Rifle & Pistol Association Inc., et al. v. Bruen, Superintendent of New York State Police, et al.:

“We respectfully disagree with the Court’s conclusion that the Second Amendment forbids New York’s reasonable requirement that individuals seeking to carry a concealed handgun must show that they need to do so for self-defense. The Department of Justice remains committed to saving innocent lives by enforcing and defending federal firearms laws, partnering with state, local and tribal authorities and using all legally available tools to tackle the epidemic of gun violence plaguing our communities.”

The Department of Justice today announced that it signed a settlement agreement with SpringShine Consulting, Inc., an IT staffing company based in California. The settlement resolves claims that SpringShine discriminated against U.S. workers based on their citizenship status when it solicited applications for employment opportunities only from those seeking sponsorship for temporary work visas.

“Employers that discourage applicants based on their citizenship or immigration status, or save certain employment opportunities only for applicants who require sponsorship to work in the United States, violate the law and must be held accountable,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Civil Rights Division will ensure that workers are protected from such unlawful discrimination.”

The department opened an investigation after an individual complained about an advertisement that SpringShine posted on a recruiting website inviting applications only from experienced IT consultants who required sponsorship for an employment-based temporary work visa. The advertisement was directed exclusively at workers seeking the company’s H-1B visa sponsorship, with no indication that workers with other citizenship statuses, such as U.S. citizens, U.S. nationals, lawful permanent residents, asylees or refugees, would also be considered for an employment opportunity. SpringShine claimed that the advertisement was not associated with an offer of employment, but was a recruiting tool to build a pool of qualified consultants to fill its clients’ anticipated future labor needs. Based on its investigation, however, the department concluded that (1) the company offered to sponsor one of the applicants who responded to the posting, (2) the advertisement reflected SpringShine’s preference for H-1B visa workers to fill its staffing needs, and (3) the posting harmed U.S. workers by unlawfully deterring many of them from applying for consideration. Under the Immigration and Nationality Act (INA), employers are not generally allowed to discriminate in recruitment or hiring based on citizenship status. 

Under the terms of the settlement agreement, SpringShine will pay $17,000 in civil penalties to the United States and ensure that its employment advertisements and hiring practices do not include or implement any unlawful preference for applicants with a particular citizenship or immigration status. Additionally, SpringShine will train employees involved in recruitment and hiring on the INA’s anti-discrimination provision. 

The Civil Rights Division’s Immigrant and Employee Rights Section (IER) is responsible for enforcing the anti-discrimination provision of the INA. The statute prohibits discrimination based on citizenship status and national origin in hiring, firing or recruitment or referral for a fee; unfair documentary practices; and retaliation and intimidation. 

Learn more about IER’s work and how to get assistance through this brief video. Find more information on how employers can avoid citizenship status discrimination on IER’s website. Applicants or employees who believe they were discriminated against based on their citizenship, immigration status, or national origin in hiring, firing, recruitment, or during the employment eligibility verification process (Form I-9 and E-Verify); or subjected to retaliation, may file a charge. The public can also call IER’s worker hotline at 1-800-255-7688 (1-800-237-2515, TTY for hearing impaired); call IER’s employer hotline at 1-800-255-8155 (1-800-237-2515, TTY for hearing impaired); email IER@usdoj.gov; sign up for a free webinar; or visit IER’s English and Spanish websites. Subscribe to GovDelivery to receive updates from IER. View the Spanish translation of this press release here.

WASHINGTON – El Departamento de Justicia anunció hoy que ha llegado un acuerdo conciliatorio con Technology Hub Inc., una compañía de contratación y reclutamiento en el ámbito de la informática con sede en Virginia. El acuerdo resuelve las acusaciones de que Technology Hub había discriminado tanto a ciudadanos de los EE. UU. como a no ciudadanos de los EE. UU. que contaban con permiso para trabajar en los Estados Unidos, con base en su estatus migratorio o ciudadanía durante su proceso de reclutamiento.

«Ni empleadores ni agencias de contratación pueden excluir a solicitantes de trabajo al promocionar o implementar preferencias ilícitas basadas en la ciudadanía o el estatus migratorio de uno», afirmó Kristen Clarke, la Fiscal General Auxiliar de la División de Derechos Civiles del Departamento de Justicia. «La División de Derechos Civiles está comprometida a hacer cumplir la ley para garantizar que los que están buscando un trabajo queden protegidos de la discriminación ilícita».

Con base en su investigación, el Departamento concluyó que en al menos cuatro ocasiones, Technology Hub buscó e investigó a solicitantes con base en la preferencia de la compañía y sus clientes por trabajadores con cierto estatus migratorio o ciudadanía. Las prácticas de la compañía perjudicaron a trabajadores que no acataban esas preferencias al disuadirles de solicitar un trabajo. Por ejemplo, la investigación reveló que en al menos tres ocasiones, Technology Hub excluyó a asilados, refugiados y nacionales de los EE. UU. al promocionar vacantes solamente para ciudadanos y residentes permanentes legales de los EE. UU. Más aún, el Departamento concluyó que en al menos una ocasión, Technology Hub discriminó a trabajadores en este país al promocionar un puesto que buscaba solamente a trabajadores con visas H-1B.

La disposición antidiscriminatoria de la ley de Inmigración y Nacionalidad (INA, por sus siglas en inglés) protege a ciudadanos estadounidenses, nacionales no ciudadanos de los EE. UU., refugiados, asilados y residentes permanentes legales recientes de la discriminación en el empleo por motivos de su estatus migratorio o de ciudadanía. Por lo general, la INA prohíbe que los empleadores y reclutadores restrinjan puestos de trabajo con base en la ciudadanía o el estatus migratorio a menos que así lo requiera una ley, un reglamento, una orden ejecutiva o un contrato gubernamental. Conforme la INA, los empleadores y otras entes que reclutan o recomiendan por comisión a trabajadores solo pueden restringir puestos con base en la ciudadanía o el estatus migratorio si así lo requiera una ley, un reglamento, una orden ejecutiva o un contrato gubernamental. Los empleadores y sus reclutadores están vulnerando la INA si implementan las preferencias discriminatorias ilegales de un cliente.

Conforme los términos del acuerdo conciliatorio, Technology Hub pagará una sanción civil que asciende a $12,000 a los Estados Unidos; revisará sus políticas y procedimientos; capacitará a los empleados y agentes relevantes acerca de la disposición antidiscriminatoria de la INA y se someterá a la supervisión durante un período de tres años con el fin de garantizar su cumplimiento.

La Sección de Derechos de Inmigrantes y Empleados de la División de Derechos Civiles es responsable de hacer cumplir la disposición antidiscriminatoria de la INA. Entre otras cosas, la ley prohíbe la discriminación con base en el estatus migratorio o de ciudadanía o bien por la nacionalidad de origen en los procesos de contratación, despido o reclutamiento o recomendación por comisión; prácticas documentales injustas y represalias e intimidación. El sitio web de la IER tiene información sobre cómo los empleadores pueden evitar la discriminación por motivos de estatus de ciudadanía en la contratación y el reclutamiento. 

Para aprender más sobre la labor de la IER y cómo conseguir ayuda, vea este vídeo corto. Aquellos aspirantes o empleados que creen haber sido discriminados por motivos de su estatus de ciudadanía o nacionalidad de origen en los procesos de contratación, despido, reclutamiento o verificación de la elegibilidad para trabajar (Formulario I-9 e E-Verify) o sujetos a represalias pueden presentar una denuncia. El público también puede llamar a la línea directa de la IER para trabajadores al 1‑800-255-7688; llamar a la línea directa de la IER para empleadores al 1-800-255-8155 (1‑800‑237-2515, TTY para personas con discapacidades auditivas); enviar un correo electrónico a IER@usdoj.gov; inscribirse a un seminario en línea gratuito; o visitar la página web de la IER en inglés o español. Para recibir las últimas noticias de la IER, inscríbase a GovDelivery.  

Visualice este comunicado de prensa en inglés.

El Departamento de Justicia anunció hoy que ha firmado un acuerdo conciliatorio con SpringShine Consulting, Inc., una compañía de contratación en el ámbito de la informática con sede en California. El acuerdo resuelve acusaciones de que SpringShine había discriminado a trabajadores en este país debido a su estatus de ciudadanía al pedir solicitudes para oportunidades de empleo únicamente a personas que buscaban patrocinio de una visa laboral temporal.

«Se debe hacer rendir cuentas a aquellos empleadores que, en contra de la ley, desalienten a solicitantes por motivos de su estatus migratorio o de ciudadanía o que reserven ciertas oportunidades laborales únicamente para solicitantes que requieren ser patrocinados para poder trabajar en los Estados Unidos», afirmó Kristen Clarke, la Fiscal General Auxiliar de la División de Derechos Civiles del Departamento de Justicia. «La División de Derechos Civiles garantizará que los trabajadores queden protegidos de tal discriminación ilegal».

El Departamento inició una investigación después de que un individuo se quejó de un anuncio que SpringShine había colgado en su sitio web de reclutamiento que pedía la entrega de solicitudes únicamente de consultores informáticos experimentados que requerían ser patrocinados para poder recibir una visa laboral temporal basada en el empleo. El anuncio estaba dirigido exclusivamente a trabajadores que buscaban el patrocinio de la compañía de visas H-1B, sin ninguna indicación que trabajadores de otro estatus de ciudadanía, tales como ciudadanos de los EE. UU, nacionales de los EE. UU., residentes permanentes legales, asilados o refugiados también serían considerados para oportunidades de empleo. SpringShine mantenía que el anuncio no estaba asociado con una oferta de empleo sino que era una herramienta de reclutamiento cuya meta era reunir un conjunto de consultores cualificados para satisfacer las necesidades laborales de sus clientes previstas para el futuro. No obstante, con base en su investigación, el Departamento concluyó que (1) la compañía se ofreció para patrocinar a uno de los solicitantes que había respondido al anuncio, (2) el anuncio reflejaba una preferencia por parte de SpringShine por satisfacer sus necesidades de contratación con trabajadores con visas H-1B y (3) el anuncio perjudicaba a trabajadores en este país al desalentar a muchos de ellos, de maner ilícita, de entregar una solicitud. En virtud de la ley de Inmigración y Nacionalidad (INA, por sus siglas en inglés), a los empleadores, por lo general, no se les permite discriminar en los procesos de reclutamiento o contratación con base en el estatus de ciudadanía. 

Conforme los términos del acuerdo conciliatorio, SpringShine pagará una sanción civil a los Estados Unidos que asciende a $17,000 y asegurará que sus anuncios de empleo y prácticas de contratación no incluyan o implementen preferencias ilícitas por candidatos con cierto estatus migratorio o ciudadanía. Además, SpringShine capacitará a sus empleados que formen parte del proceso de reclutamiento y contratación en cuanto a la disposición antidiscriminatoria de la INA. 

La Sección de Derechos de Inmigrantes y Empleados de la División de Derechos Civiles es responsable de hacer cumplir la disposición antidiscriminatoria de la INA. La ley prohíbe la discriminación por motivos de estatus migratorio o nacionalidad de origen en los procesos de contratación, despido o reclutamiento o recomendación por comisión; , prácticas documentales injustas o represalias e intimidación.   

Para aprender más sobre la labor de la IER y cómo conseguir ayuda, vea este vídeo corto. Aprenda más sobre cómo los empleadores pueden evitar la discriminación por motivos de estatus de ciudadanía en el sitio web de la IER. Aquellos aspirantes o empleados que creen haber sido discriminados por motivos de su estatus de ciudadanía o nacionalidad de origen en los procesos de contratación, despido, reclutamiento o verificación de la elegibilidad para trabajar (Formulario I-9 e E-Verify) o sujetos a represalias pueden presentar una denuncia. El público también puede llamar a la línea directa de la IER para trabajadores al 1-800-255-7688 (1-800-237-2515, TTY para personas con discapacidades auditivas); llamar a la línea directa de la IER para empleadores al 1-800-255-8155 (1-800-237-2515, TTY para personas con discapacidades auditivas); enviar un correo electrónico a IER@usdoj.gov; inscribirse a un seminario en línea gratuito; o visitar los sitios web de la IER en inglés o español. Para recibir las últimas noticias de la IER, inscríbase a GovDelivery.

A motocross instructor who traveled the country building motocross tracks and mentoring children was indicted yesterday for multiple child exploitation offenses.

According to court documents, Ryan Meyung, 30, engaged six different minor victims in sexually explicit conduct to produce images of child sexual abuse, and transported and possessed visual images of child sexual abuse. The alleged crimes occurred between 2019 and 2021. He was arrested on state charges in December 2021 and has remained in custody.

Meyung was known to frequent states including Georgia, Indiana, Kentucky, Michigan, New Jersey, New York, Ohio, Oklahoma, Pennsylvania, and Tennessee.

If you suspect that you have information that could further law enforcement’s investigation, you are encouraged to call the Homeland Security Investigations (HSI) Tipline at (866) 347-2423 or https://www.ice.gov/tipline.

Meyung is charged with six counts of producing child pornography, one count of transporting child pornography, and one count of possessing child pornography. If convicted, Meyung faces a mandatory minimum sentence of 15 years in prison and a maximum of 210 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Ryan K. Buchanan of the Northern District of Georgia, and Resident Agent in Charge Arturo Napolitano of HSI Chattanooga made the announcement.

HSI Chattanooga is investigating this case jointly with the Hamilton County Sheriff’s Office (Tennessee), the Chattanooga Police Department, and HSI field offices throughout the country. 

Trial Attorney Jessica L. Urban of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Erin N. Spritzer of the U.S. Attorney’s Office for the Northern District of Georgia are prosecuting the case. 

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

An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The Justice Department announced today that it has secured an agreement with the State of Alaska and state officials to resolve claims that driver license transactions did not consistently provide certain voter registration opportunities required by Section 5 of the National Voter Registration Act of 1993 (NVRA).

Section 5 of the NVRA, also known as the “motor voter” provision, requires covered states to provide voter registration opportunities for federal elections when people apply for or renew driver’s licenses or other identification documents through state motor vehicle offices. The NVRA also requires that changes of address submitted for driver’s license or identification document purposes update voter registration information unless the applicant opts out of the update.

The Justice Department’s investigation found that applications and renewals for Alaska’s driver’s licenses and identification documents did not consistently serve as voter registration applications for federal office as required by the NVRA. Likewise, the procedures by which citizens notify the state’s motor vehicle office that their address had changed did not serve as a notification of change of address for voter registration purposes.

Under the terms of the settlement, Alaska will fully integrate a voter registration opportunity into all applications for driver’s licenses and other identification documents. Alaska will also ensure that all change of address information submitted for driver’s licenses or state-issued identification purposes will be used to update voters’ address information unless a voter declines to update their voter registration. Alaska has also agreed to appoint a Division of Motor Vehicles NVRA coordinator and NVRA site coordinators for each Division of Motor Vehicles office.

“The ability to register to vote and to update voter registration information easily and conveniently is essential in a robust, inclusive democracy,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “This agreement is part of our commitment to ensuring that eligible voters across Alaska have access to voter registration opportunities required by federal law. We will continue working to ensure that states and counties across the country are complying with the mandates of the National Voter Registration Act and other federal voting rights laws. We thank state officials for agreeing to undertake actions we deem necessary to achieve compliance with the mandates of the NVRA.”

“I commend our many state officials for their hard work and dedication in reaching this agreement,” said U.S. Attorney S. Lane Tucker for the District of Alaska. “It is vital for every citizen in our democracy to have a full and fair opportunity to participate in the electoral process. This includes the ability of every citizen to register to vote and to update their registration information with the ease of access that the law requires.”

More information about the NVRA and other federal voting laws is available on the Department of Justice website at www.justice.gov/crt/about/vot/. Complaints under the federal voting rights laws may be reported to the Civil Rights Division at https://civilrights.justice.gov/.

On the 23rd anniversary of the landmark Supreme Court decision in Olmstead v. L.C., the Department of Justice announced today that it has concluded that Maine unnecessarily segregates children with mental health and/or developmental disabilities, in psychiatric hospitals, residential treatment facilities, and a state-operated juvenile detention facility. The Olmstead decision held that people with disabilities have a right to live and receive services in the most integrated setting appropriate to their needs — typically in their homes and communities instead of in institutions.

Disability Rights Maine, the protection and advocacy agency for people with disabilities in Maine, filed a complaint with the department on behalf of a group of children with disabilities, alleging that these children cannot access needed community-based services, resulting in their institutionalization or risk of institutionalization in violation of the Americans with Disabilities Act (ADA) and the Supreme Court’s decision in Olmstead. The department’s findings, detailed in a letter to Maine Governor Janet Mills and Attorney General Aaron Frey, follow a thorough investigation into the complaint and the State’s system of care for children with behavioral health needs.

Many children with disabilities in Maine, especially those in rural areas or with more intensive needs, are unable to live at home with their families due to a lack of community-based behavioral health services. These services can include assistance with daily activities, behavior management, and individual or family counseling. Community-based behavioral health services also include crisis services that can prevent a child from being institutionalized during a mental health crisis. Absent these services, Maine children with disabilities enter emergency rooms, come into contact with law enforcement, and remain in institutions when many of them could be at home if Maine put in place sufficient community-based services.

“Children with disabilities deserve the opportunity to live at home with the services they need and grow up in the community alongside their nondisabled peers,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “With the increase in children’s mental health needs during the pandemic, it is more important than ever to provide support to children and families. We look forward to bringing Maine into compliance with federal law and achieving a resolution that will benefit children with disabilities across the state.”

“Access to local community-based services for children with mental health and/or developmental disabilities is a critical need for families across Maine,” said U.S. Attorney Darcie N. McElwee for the District of Maine. “I hope that the violations identified by the Justice Department can be remedied so that these children and their families are able to obtain quality services in their own communities.”

The department’s investigation found a number of barriers to accessing children’s behavioral health services in the community, including lengthy waitlists, an insufficient provider network, inadequate crisis services, and a lack of support for foster care parents who provide specialized care to children with behavioral health needs. As a result, Maine children must enter in- and out-of-state facilities, or even the state-operated juvenile detention facility, Long Creek Youth Development Center, to receive behavioral health services.

This investigation was conducted by the Department of Justice’s Civil Rights Division  Disability Rights Section with the assistance of the U.S. Attorney’s Office for the District of Maine. The full findings letter can be found at https://www.justice.gov/crt/disability-rights-cases.

The Justice Department’s statement commemorating the Olmstead anniversary can be found here. Additional information about the Civil Rights Division’s Olmstead enforcement is available on its website at https://www.ada.gov/olmstead/.

Geary Staten, 31, a former supervisory correctional officer at Valdosta State Prison (VSP), pleaded guilty today in federal court to one count of misprision of a felony for his role in attempting to cover up an assault on an inmate incarcerated at the facility.

According to court documents and statements made in connection with the guilty plea, while Lieutenant Staten was on duty as a supervisory correctional officer at VSP, several VSP correctional officers unlawfully used force on inmate F.G. in violation of the inmate’s constitutional rights. Staten was aware of the assault but instead of reporting or otherwise notifying law enforcement authorities of these felony violations, Staten took steps to conceal the offense by (1) directing the involved officers (Officer Brian Ford, Officer Jamal Scott, and Sergeant Patrick Sharpe, all of whom have pleaded guilty to federal offenses in connection with the incident) not to write any report to VSP officials or any other Georgia Department of Corrections officials regarding the unlawful use of force; and (2) failing to write such a report himself, despite knowing such a report was required.

“It is important that corrections officers and their supervisors are held accountable for using unlawful, unnecessary, and unwarranted force against inmates, including those who fail to report such civil rights violations and take steps to cover them up,” said Assistant Attorney General Kristen Clarke for the Justice Department’s Civil Rights Division. “The Civil Rights Division will continue to hold correctional officials accountable when they violate the civil rights of incarcerated individuals.”

“Many corrections officers do honorable work, but officers and their supervisors who turn a blind eye or even cover-up crimes against the people under their watch are committing a serious offense that our office will simply not ignore,” said U.S. Attorney Peter D. Leary of the Middle District of Georgia. “Prisoners should serve their sentences without being assaulted or extorted; our office will work to uphold the civil rights of all people, including the incarcerated.”

“By violating his sworn oath as a corrections officer, Staten betrayed every honest, hardworking officer, and stooped to behaving like the criminals he was sworn to protect,” said Special Agent in Charge Keri Farley of FBI Atlanta. “The abuse of inmates by prison staff will not be tolerated by the FBI and will always be pursued for prosecution.”

Staten faces a maximum statutory penalty of up to three years in prison and a fine of up to $250,000. A sentencing hearing has been scheduled for Sept. 21.

Assistant Attorney General Clarke, U.S. Attorney Leary and FBI Atlanta Special Agent in Charge Farley made the announcement. The case was investigated by the FBI and a local task-force-officer partner, and was prosecuted by Trial Attorneys Katherine G. DeVar and Nicole Raspa of the Justice Department’s Civil Rights Division, with assistance from Assistant U.S. Attorney Michael Solis for the Middle District of Georgia.

Eight defendants were charged in the Eastern District of Pennsylvania today with scheming to fraudulently obtain more than $7 million in Paycheck Protection Program (PPP) loans, Economic Injury Disaster Loans (EIDL), and pre-pandemic Small Business Administration (SBA) loans.

According to court documents, beginning in or around January 2018, defendants Frank Hamilton, 52, of Simi Valley, California; Michael Jones, 55, of Azusa, California; Tina Chen, 39, of Diamond Bar, California; Kenny Tran, 38, of Diamond Bar, California; Tim Park, 37, of Northridge, California; Peter An, 37, of Chatsworth, California; Joseph Greco, 42, of Simi Valley, California; Edwin Bonilla, 36, of Los Angeles, California, and others allegedly conspired to apply for SBA, PPP, and EIDL loans on behalf of their respective businesses that were dormant companies or companies with limited business operations. In exchange for fees, Hamilton, Jones, and others made the businesses appear to be functioning companies with operations and employees by creating fake documents, including fake bank statements and fictitious tax documents for the businesses. One conspirator provided a script for other conspirators to use in calls with lenders. The conspirators allegedly obtained over $7 million in PPP, EIDL, and SBA loans. 

Court documents further allege that the conspirators followed so-called “forgiveness plans” that directed them to transfer the fraud proceeds as purported payroll payments for each of the companies that obtained PPP funds. These “forgiveness plans” were designed to disguise the proceeds as payroll payments and make it appear that the loan recipient was meeting the SBA requirement that a percentage of the PPP funds be used for payroll, thus increasing the likelihood that the loan recipient would qualify for loan forgiveness. At Hamilton’s direction, Jones, Chen, Tran, Park, An, Greco, and Bonilla wired the disguised fraud proceeds to a bank account in the name of a dormant company Hamilton controlled.

Hamilton, Jones, Chen, Tran, Park, An, Greco, and Bonilla are each charged with conspiracy to commit wire fraud. If convicted, they each face up to 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania; Special Agent in Charge Amaleka McCall-Brathwaite of the SBA Office of Inspector General (SBA-OIG) Eastern Region; Special Agent in Charge Yury Kruty of IRS-Criminal Investigation (IRS-CI) Philadelphia Field Office; Special Agent in Charge William Walker of Homeland Security Investigations (HSI) Philadelphia Field Office; and Special Agent in Charge Jacqueline Maguire of the FBI’s Philadelphia Field Office made the announcement.

This case was investigated by the SBA-OIG, IRS-CI, HSI’s Philadelphia Field Office, and the FBI’s Philadelphia Field Office. 

Trial Attorneys David A. Stier and Patrick B. Gushue of the Criminal Division’s Money Laundering and Asset Recovery Section and Assistant U.S. Attorney Judy G. Smith of the U.S. Attorney’s Office for the Eastern District of Pennsylvania are prosecuting the case.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866 720 5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

An information is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.   

The Department of Justice announced today that it has obtained a settlement agreement resolving allegations that Meta Platforms Inc., formerly known as Facebook Inc., has engaged in discriminatory advertising in violation of the Fair Housing Act (FHA). The proposed agreement resolves a lawsuit filed today in the U.S. District Court for the Southern District of New York alleging that Meta’s housing advertising system discriminates against Facebook users based on their race, color, religion, sex, disability, familial status and national origin. The settlement will not take effect until approved by the court.

Among other things, the complaint alleges that Meta uses algorithms in determining which Facebook users receive housing ads, and that those algorithms rely, in part, on characteristics protected under the FHA. This is the department’s first case challenging algorithmic bias under the Fair Housing Act.

Under the settlement, Meta will stop using an advertising tool for housing ads (known as the “Special Ad Audience” tool) that, according to the department’s complaint, relies on a discriminatory algorithm. Meta also will develop a new system to address racial and other disparities caused by its use of personalization algorithms in its ad delivery system for housing ads. That system will be subject to Department of Justice approval and court oversight.

This settlement marks the first time that Meta will be subject to court oversight for its ad targeting and delivery system.

“As technology rapidly evolves, companies like Meta have a responsibility to ensure their algorithmic tools are not used in a discriminatory manner,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “This settlement is historic, marking the first time that Meta has agreed to terminate one of its algorithmic targeting tools and modify its delivery algorithms for housing ads in response to a civil rights lawsuit. The Justice Department is committed to holding Meta and other technology companies accountable when they abuse algorithms in ways that unlawfully harm marginalized communities.”  

“When a company develops and deploys technology that deprives users of housing opportunities based in whole or in part on protected characteristics, it has violated the Fair Housing Act, just as when companies engage in discriminatory advertising using more traditional advertising methods,” said U.S. Attorney Damian Williams for the Southern District of New York. “Because of this ground-breaking lawsuit, Meta will — for the first time — change its ad delivery system to address algorithmic discrimination. But if Meta fails to demonstrate that it has sufficiently changed its delivery system to guard against algorithmic bias, this office will proceed with the litigation.”  

“It is not just housing providers who have a duty to abide by fair housing laws,” said Demetria McCain, the Principal Deputy Assistant Secretary for Fair Housing and Equal Opportunity at the Department of Housing and Urban Development (HUD). “Parties who discriminate in the housing market, including those engaging in algorithmic bias, must be held accountable. This type of behavior hurts us all. HUD appreciates its continued partnership with the Department of Justice as they seek to uphold our country’s civil rights laws.”

United States’ Lawsuit

The United States’ complaint challenges three key aspects of Meta’s ad targeting and delivery system. Specifically, the department alleges that:

• Meta enabled and encouraged advertisers to target their housing ads by relying on race, color, religion, sex, disability, familial status and national origin to decide which Facebook users will be eligible and ineligible to receive housing ads.
• Meta created an ad targeting tool known as “Lookalike Audience” or “Special Ad Audience.” The tool uses a machine-learning algorithm to find Facebook users who share similarities with groups of individuals selected by an advertiser using several options provided by Facebook. Facebook has allowed its algorithm to consider FHA-protected characteristics — including race, religion and sex — in finding Facebook users who “look like” the advertiser’s source audience and thus are eligible to receive housing ads.
• Meta’s ad delivery system uses machine-learning algorithms that rely in part on FHA-protected characteristics — such as race, national origin and sex — to help determine which subset of an advertiser’s targeted audience will actually receive a housing ad.

The complaint alleges that Meta has used these three aspects of its advertising system to target and deliver housing-related ads to some Facebook users while excluding other users based on FHA-protected characteristics.

The department’s lawsuit alleges both disparate treatment and disparate impact discrimination. The complaint alleges that Meta is liable for disparate treatment because it intentionally classifies users on the basis of FHA-protected characteristics and designs algorithms that rely on users’ FHA-protected characteristics. The department further alleges that Meta is liable for disparate impact discrimination because the operation of its algorithms affects Facebook users differently on the basis of their membership in protected classes.

Settlement Agreement

These are the key features of the parties’ settlement agreement:

• By Dec. 31, 2022, Meta must stop using an advertising tool for housing ads known as “Special Ad Audience” (previously called “Lookalike Audience”), which relies on an algorithm that, according to the United States, discriminates on the basis of race, sex and other FHA-protected characteristics in identifying which Facebook users will be eligible to receive an ad.
• Meta has until December 2022 to develop a new system for housing ads to address disparities for race, ethnicity and sex between advertisers’ targeted audiences and the group of Facebook users to whom Facebook’s personalization algorithms actually deliver the ads. If the United States concludes that this new system sufficiently addresses the discriminatory disparities that Meta’s algorithms introduce, then Meta will fully implement the new system by Dec. 31, 2022.
• If the United States concludes that Meta’s changes to its ad delivery system do not adequately address the discriminatory disparities, the settlement agreement will terminate and the United States will litigate its case against Meta in federal court.
• The parties will select an independent, third-party reviewer to investigate and verify on an ongoing basis whether the new system is meeting the compliance standards agreed to by the parties. Under the agreement, Meta must provide the reviewer with any information necessary to verify compliance with those standards. The court will have ultimate authority to resolve disputes over the information that Meta must disclose.
• Meta will not provide any targeting options for housing advertisers that directly describe or relate to FHA-protected characteristics. Under the agreement, Meta must notify the United States if Meta intends to add any targeting options. The court will have authority to resolve any disputes between the parties about proposed new targeting options.
• Meta must pay to the United States a civil penalty of $115,054, the maximum penalty available under the Fair Housing Act.

The Justice Department’s lawsuit is based in part on an investigation and charge of discrimination by HUD, which found that all three aspects of Meta’s ad delivery system violated the Fair Housing Act. When Facebook elected to have the HUD charge heard in federal court, HUD referred the matter to the Justice Department for litigation.

This case is being handled jointly by the Justice Department’s Civil Rights Division and the U.S. Attorney’s Office for the Southern District of New York.

Assistant Attorney General Kristen Clarke and U.S. Attorney Damian Williams thanked the Department of Housing and Urban Development for its efforts in the investigation.

The Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt. More information about the U.S. Attorney’s Office for the Southern District of New York is available at www.justice.gov/usao-sdny. Individuals who believe they have been victims of housing discrimination may submit a report online at www.civilrights.justice.gov, or may contact the Department of Housing and Urban Development at 1-800-669-9777 or through its website at www.hud.gov.

“There is no hiding place for war criminals. The U.S. Justice Department will pursue every avenue of accountability for those who commit war crimes and other atrocities in Ukraine.”

In a meeting with Ukrainian Prosecutor General Iryna Venediktova, Attorney General Merrick B. Garland commended the efforts of the Ukrainian people to defend democracy and uphold the rule of law, and announced additional U.S. actions to help Ukraine identify, apprehend, and prosecute those individuals involved in war crimes and other atrocities in Ukraine.

“The United States stands in solidarity with the people of Ukraine in the face of Russia’s continued aggression and assault on Ukraine’s sovereignty and territorial integrity,” said Attorney General Garland. “America – and the world – has seen the many horrific images and read the heart-wrenching accounts of brutality and death that have resulted from Russia’s unjust invasion of Ukraine.”

Specifically, Attorney General Garland announced the launch of a War Crimes Accountability Team to centralize and strengthen the Justice Department’s ongoing work to hold accountable those who have committed war crimes and other atrocities in Ukraine. This initiative will bring together the Department’s leading experts in investigations involving human rights abuses and war crimes and other atrocities; and provide wide-ranging technical assistance, including operational assistance and advice regarding criminal prosecutions, evidence collection, forensics, and relevant legal analysis. The team will also play an integral role in the Department’s ongoing investigation of potential war crimes over which the U.S. possesses jurisdiction, such as the killing and wounding of U.S. journalists covering the unprovoked Russian aggression in Ukraine.

“There is no hiding place for war criminals. The U.S. Justice Department will pursue every avenue of accountability for those who commit war crimes and other atrocities in Ukraine,” said Attorney General Garland. “Working alongside our domestic and international partners, the Justice Department will be relentless in our efforts to hold accountable every person complicit in the commission of war crimes, torture, and other grave violations during the unprovoked conflict in Ukraine.”

To lead this effort, the Attorney General has tapped Eli Rosenbaum to serve as Counselor for War Crimes Accountability. Rosenbaum is a 36-year veteran of the Justice Department who previously served as Director of the Office of Special Investigations (OSI), which was primarily responsible for identifying, denaturalizing, and deporting Nazi war criminals. In his role as Counselor for War Crimes Accountability, Rosenbaum will coordinate efforts across the Justice Department and the federal government to hold accountable those responsible for war crimes and other atrocities in Ukraine. Rosenbaum will be joined in his work by other prosecutors from the Human Rights and Special Prosecutions Section (HRSP), including Acting Section Chief Hope Olds and prosecutors Christian Levesque, Christina Giffin, and Courtney Urschel.

In addition, the Justice Department will provide additional personnel to expand its work with Ukraine and other partners to counter Russian illicit finance and sanctions evasion. Among other things, the Department will provide Ukraine an expert Justice Department prosecutor to advise on fighting kleptocracy, corruption, and money laundering. In addition, it plans to deploy two expert attorneys from the Office of International Affairs (OIA) – one to a U.S. Embassy in Europe, and another to a U.S. Embassy in the Middle East – in support of the Department’s KleptoCapture Task Force. These senior attorneys will work closely with their counterparts in EU member states and Middle Eastern countries to facilitate mutual legal assistance and extraditions relating to Russian illicit finance and sanctions evasion, including with respect to designated Russian oligarchs who have supported the Russian regime and its efforts to undermine Ukrainian sovereignty.

Attorney General Garland announced the KleptoCapture Task Force in March to further leverage the Department’s tools and authorities against efforts to evade or undermine the economic actions taken by the U.S. Government in response to Russian military aggression. Since then, the task force has facilitated the seizure of superyachts of two sanctioned individuals with close ties to the Russian regime; dismantled Russian criminal networks; and enforced sanctions violations, among other actions.

This week, Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division is in Paris, France, to participate in meetings of the Organization for Economic Cooperation and Development (OECD) Competition Committee and its working parties.

Today, Assistant Attorney General Kanter chaired the working party on enforcement and cooperation with sessions devoted to interim measures, expanding cooperation, and revising an OECD Council Recommendation on Bid Rigging and Procurement. Later in the week, Assistant Attorney General Kanter will participate in the Competition Committee roundtable focused on Market Power in the Digital Economy.

The OECD Competition Committee includes 38 member countries and the European Union, as well as non-member participants, experts, and other invitees. The Committee brings together leaders of the world’s major competition authorities for a dialogue on competition policy issues, including best practices and standards, and promotes market-oriented reforms. Other roundtables scheduled for the meeting include:

• Competition and Regulation in the Provision of Local Transportation Services
• Purchasing Power and Buyers Cartels
• Disentangling Consummated Mergers – Experiences and Challenges
• Integrating Consumer Behavior Insights in Competition Enforcement

The United States and other OECD member submissions on these topics are available on the OECD Competition Committee’s website.

On June 20, Assistant Attorney General Kanter met with French Competition Authority Chair Benoit Coeuré in a public forum at the Authority’s headquarters. The two leaders discussed the Antitrust Division’s and French Competition Authority’s mutual interest in promoting competition in a fair, global marketplace, their current priorities, and building stronger transatlantic cooperation on antitrust enforcement. The video of the meeting is available at https://www.autoritedelaconcurrence.fr/en/article/watch-replay-our-echelle-event-us-french-perspectives-competition-policy.

A Florida man was arrested today for allegedly distributing more than $230 million in adulterated HIV drugs that were ultimately dispensed to unsuspecting patients throughout the country. 

According to an indictment unsealed today, Lazaro Hernandez, 51, of Miami, was allegedly part of a nationwide scheme to defraud the U.S. Food and Drug Administration (FDA) and illegally distribute more than $230 million in adulterated and misbranded prescription drugs that were dispensed to unsuspecting patients. As alleged in the indictment, Hernandez acquired large quantities of HIV medication illegally and then created false drug labeling and other documentation to make it appear as though these high-priced drugs had been obtained legitimately. To carry out the scheme, Hernandez and co-conspirators established licensed wholesale drug distribution companies in Florida, New Jersey, Connecticut, and New York. Hernandez and his co-conspirators used those companies to sell the adulterated drugs at steep discounts to other co-conspirators at wholesale pharmaceutical distributors in Mississippi, Maryland, and New York. Those wholesale pharmaceutical distributors then resold the drugs to pharmacies throughout the country, which billed the drugs to health insurers, including Medicare, and dispensed the adulterated and misbranded HIV medication to unsuspecting patients. 

As alleged in the indictment, between approximately 2019 and 2021, the wholesale pharmaceutical distributors paid Hernandez and his co-conspirators more than $230 million for the illegally acquired and adulterated prescription drugs. Hernandez allegedly laundered those hundreds of millions of dollars through the use of several corporations in Miami.

Hernandez is charged with conspiracy to deliver into interstate commerce adulterated and misbranded drugs, conspiracy to traffic in medical products with false documentation, conspiracy to commit money laundering, and specific money laundering offenses. If convicted of all counts, he faces a maximum total penalty of more than 100 years in prison. The defendant was also charged in a separate, superseding indictment that was returned by a grand jury in Miami on June 14. Hernandez is scheduled to make his initial court appearance in both cases today in the U.S. District Court for the Southern District of Florida. 

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Juan Antonio Gonzalez for the Southern District of Florida, Special Agent in Charge Omar Pérez Aybar of the Department of Health and Human Services Office of Inspector General (HHS-OIG), and Special Agent in Charge Kyle A. Myles of the Federal Deposit Insurance Corporation Office of Inspector General (FDIC-OIG), Atlanta Region, made the announcement.

HHS-OIG and FDIC-OIG are investigating the case. 

Trial Attorney Alexander Thor Pogozelski of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Timothy James Abraham of the Southern District of Florida are prosecuting the case. Assistant U.S. Attorney Emily Stone is handling forfeiture. 

An indictment is merely an allegation and the defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

A federal jury found defendant Lonnie Mitchell, 36, guilty of numerous offenses relating to the defendant’s involvement in coercing several victims, including a minor, to engage in prostitution over the course of several years. Following a five-day trial, the jury convicted the defendant of sex trafficking by force, fraud and coercion of five victims. The jury also found the defendant guilty of sex trafficking a minor, and three counts of coercing and enticing an individual to travel in interstate commerce for prostitution purposes. Two other defendants previously pleaded guilty.

According to the evidence presented in court, defendant Lonnie Mitchell targeted vulnerable victims who struggled with drug addictions, and then manipulated their drug addictions for his benefit. He increased the victims’ use of heroin and encouraged them to use it intravenously. He then did not provide heroin to the victims if they violated one of his many controlling rules or otherwise did not see enough commercial sex clients. Other consequences of violating defendant Mitchell’s rules or failing to provide him with sufficient money from prostitution included violence, threats of violence, and threats to send embarrassing information, photos, or videos to the victims’ loved ones. In addition, defendant Mitchell regulated the amount of food the victims could eat, when they could eat, and also confiscated their identity documents and credit cards all as part of his coercive scheme to control the victims.   

Defendant Mitchell’s co-defendant and sister, Nettisia Mitchell, was aware of her brother’s scheme and facilitated it. Nettisia Mitchell had previously pleaded guilty to conspiracy to commit sex trafficking by force, fraud and coercion. According to court documents, Nettisia witnessed Lonnie’s violence against a victim yet harbored the victim and received the proceeds from the victim’s involvement in commercial sex. A third co-defendant, Donna Emmons, previously pleaded guilty to conspiracy to commit sex trafficking of a minor. Both Nettisia Mitchell and Emmons await sentencing. They face a maximum sentence of life in prison and mandatory restitution.

“Motivated by control, power and greed, this defendant targeted and recruited vulnerable victims who were struggling in life, and used their vulnerabilities and unspeakable violence to sell them over and over again for his own profit,” said Assistant Attorney General Kristen Clarke of the Justice Department's Civil Rights Division. “Sex trafficking and forced prostitution are heinous crimes that have no place in our society today. The Department of Justice remains committed to using our human trafficking laws to protect those who are the most vulnerable members of society and vindicate their rights.”

“Mitchell beat, threatened, manipulated and exploited his victims,” said U.S. Attorney Sandra J. Stewart for the Middle District of Alabama. “He took advantage of their suffering and addictions to force them into prostitution and drug dealing, all for his own personal gain. The damage caused was not only physical, but also emotional. Undoubtedly, the victims will long be haunted by Mitchell’s actions. My office is committed to helping our law enforcement partners identify and prosecute those who prey on the young and vulnerable. I am grateful for today’s verdict and for the victims who told their stories during the trial. Because of their bravery, Mitchell will be held accountable for his crimes.”

“This verdict means Mitchell is facing justice for the many horrors that he inflicted upon his victim, in the name of profit,” said Special Agent in Charge Katrina Berger, who oversees Homeland Security Investigations (HSI) operations in Georgia and Alabama. “Thankfully, he will no longer be able to prey upon innocent children. This is another example of not only the great partnership HSI has with its law enforcement partners, but also the great work we do to protect our communities.” 

Sentencing has not yet been scheduled in this matter. Defendant Mitchell faces a mandatory minimum sentence of 15 years for sex trafficking by force, fraud and coercion, and a maximum sentence of life. Restitution is also required under federal law. 

Assistant Attorney General Kristen Clarke of the Justice Department's Civil Rights Division and U.S. Attorney Sandra J. Stewart for the Middle District of Alabama made the announcement.

This case was investigated by HSI, Alabama Law Enforcement Agency, Montgomery County Sheriff’s Office, and Montgomery Police Department. It is being prosecuted by Assistant U.S. Attorney J. Patrick Lamb for the Middle District of Alabama and Trial Attorney Kate Alexander of the Civil Rights Division’s Human Trafficking Prosecution Unit. 

Anyone who has information about human trafficking should report that information to the National Human Trafficking Hotline toll-free at 1-888-373-7888, which is available 24 hours a day, seven days a week. For more information about human trafficking, please visit www.humantraffickinghotline.org.

Ransomware has become a global problem that requires cooperation on a worldwide level. Judicial experts and practitioners from the United States and the European Union participated in a two-day workshop in The Hague organized by the U.S. Department of Justice and Eurojust. The event aimed to share best practices and enhance collaboration in confronting ransomware attacks.

The event was opened by Eurojust President Ladislav Hamran and Assistant Attorney General Kenneth A. Polite, Jr. of the U.S. Department of Justice’s Criminal Division.

Assistant Attorney General Polite said: “Only by working together with key law enforcement and prosecutorial partners in the EU can we effectively combat the threat that ransomware poses to our society. I am confident that the U.S.-EU ransomware workshop will spur greater coordination and collaboration to address the ransomware threat.”

Eurojust President Hamran said: “There is no doubt that the scale, sophistication and impact of ransomware attacks is significant, affecting all sectors of the economy and society at large. We warmly welcome the opportunity to join forces with our U.S. colleagues in combating this form of crime. Through this week’s workshop, we are fostering closer cooperation not only between national authorities, but also between the public and the private sector. I am convinced that this will prove to be crucial in our efforts to protect our citizens against online and offline threats.”

The workshop, organized by the U.S. Department of Justice and Eurojust, brought together more than 100 prosecutors, law enforcement representatives and experts from the private sector and nongovernmental organizations, representing 27 countries. It took place on June 15 and 16 at Eurojust’s premises and online.

Participants attended a series of presentations and panel discussions on topics such as transnational cooperation on ransomware investigations, victim remediation, and prosecution of criminal organizations. 

Attorneys from the Justice Department’s Computer Crime and Intellectual Property Section (CCIPS), representatives from the FBI, the U.S. Secret Service, the U.S. Homeland Security Investigations (HSI), European Judicial Cybercrime Network, Eurojust’s Cybercrime Team and Europol’s European Cybercrime Centre shared their experiences, best practices, and lessons learned in directing an investigation to a successful outcome including collaborating with the tech and private sector. Law enforcement officers also discussed adversaries’ tactics and the latest investigative techniques. 

Prosecutors additionally discussed relevant changes in the law, including issues related to electronic evidence, charging options, and cross-border considerations.  Private sector and nongovernmental organization representatives included the CyberPeace institute, Microsoft and Bitdefender.

A recording of the opening remarks is available on the Eurojust YouTube channel at https://youtu.be/cQLTg0x5fhI for Assistant Attorney General Polite and https://youtu.be/3bfUvl4rZmc for Eurojust President Hamran.

Learn more about the Criminal Division’s International Computer Hacking and Intellectual Property (ICHIP) Program, jointly administered by the Criminal Division’s Office of Overseas Prosecutorial Development, Assistance and Training and CCIPS, here.

Attorney General Merrick B. Garland today made the following statement in honor of World Elder Abuse Awareness Day:

“The Department of Justice is committed to protecting and supporting the most vulnerable among us, including by advancing elder justice. Elder abuse, fraud, and neglect remain urgent problems in our country, particularly as the COVID-19 pandemic ushered in a new wave of exploitative practices targeted at seniors.

“Over the past 15 months that I have served as Attorney General, the Justice Department has worked to expand our capacity to prevent elder abuse, prosecute perpetrators of that abuse, and protect and support elderly survivors.

“To these ends, our Elder Justice Initiative coordinates programmatic efforts to prevent and respond to elder abuse, including by developing training and resources for our partners at all levels of government and beyond. Our grantmaking components have also funded the development of coordinated, multi-disciplinary approaches to advancing elder justice, including Multidisciplinary Teams.

“In addition, Elder Justice Coordinators in each of our 94 U.S. Attorneys’ offices nationwide are working to successfully prosecute cases of elder abuse, including by supporting our Transnational Elder Fraud Strike Force. The Strike Force, which was launched and is led by the Department’s Consumer Protection Branch, brings together attorneys, agents, and analysts from across the federal government to disrupt and prosecute foreign-based fraud schemes that target American seniors.

“And we continue to expand our capacity to protect and support survivors of elder abuse. This includes a training and technical assistance program to develop and expand statewide Elder Justice Coalitions and our Abuse in Later Life Program, which supports organizations dedicated to assisting older individuals and advancing comprehensive, multi-disciplinary solutions to elder abuse.

“On World Elder Abuse Awareness Day, the Department of Justice joins our partners across America and around the world in reaffirming our commitment to preventing and ending elder abuse in all of its many forms.”

If you need assistance or to report elder abuse, please contact your local adult protective services agency through the Eldercare Locator or by call the helpline at 1-800-677-1116 Monday – Friday 9am - 8pm EST. To report elder fraud, please visit the FBI’s IC3 Elder Fraud Complaint Center or contact the dedicated National Elder Fraud Hotline at 833–FRAUD–11 or 833–372–8311 Monday – Friday, 10:00 am – 6:00 pm EST.

A federal jury today convicted a man who operated labor-staffing companies in Florida with conspiracy to harbor non-resident aliens and induce them to remain in the country, conspiracy to commit money laundering, and conspiracy to defraud the IRS.

Mykhaylo Chugay and others owned and operated a series of labor-staffing companies in southern Florida, including General Labor Solutions LLC, Liberty Specialty Service LLC, Paradise Choice LLC, Paradise Choice Cleaning LLC, Tropical City Services LLC and Tropical City Group LLC, between August 2007 and July 2021. At trial, the government proved that Chugay, through these staffing companies, facilitated the employment of individuals in hotels, bars and restaurants in Key West and other locations, even though the employees were not authorized to work in the United States.

The government also proved that Chugay and his co-conspirators defrauded the IRS out of more than $10 million in Social Security and Medicare taxes that should have been collected and paid over in connection with the employment of these workers. In addition, the government proved Chugay conspired to encourage workers to enter the United States and remain in the country, in violation of immigration laws. The government also proved that Chugay and others sent checks and wires totaling more than $11 million in proceeds from the illegal scheme to conspirators in Ukraine and elsewhere.

Chugay was convicted at trial on all counts. He is scheduled to be sentenced on Aug. 22 and faces maximum penalties of five years in prison on the tax conspiracy, 10 years in prison for conspiring to harbor aliens and induce them to remain in the United States and 20 years in prison on the money laundering conspiracy. He also faces a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Juan Antonio Gonzalez for the Southern District of Florida made the announcement.

The U.S. Department of Homeland Security's Homeland Security Investigations and IRS-Criminal Investigation are investigating the case. U.S. Citizenship and Immigration Services and U.S. Customs and Border Protection, Air and Marine Operations provided substantial assistance at trial.

Senior Litigation Counsel Sean Beaty, Trial Attorneys Jessica A. Kraft and Nicholas J. Schilling Jr., and Paralegal Robert Resto of the Tax Division, and Assistant U.S. Attorney Chris Clark of the Southern District of Florida, are prosecuting the case.

U.S. District Court Judge Kenneth D. Bell sentenced defendant Thuy Tien Luong, 38, of Charlotte, North Carolina, to 15 years in prison and ordered her to pay $75,000 in restitution to the victim. A federal jury previously convicted the defendant of forced labor on Jan. 8, 2021, following a five-day trial.

According to the evidence presented at trial, the defendant compelled the victim’s labor for almost two years through a variety of coercive means. The defendant physically, emotionally and verbally punished the victim when she disobeyed the defendant or otherwise failed to perform the required labor to the defendant’s satisfaction. As an example, the defendant falsely claimed that the victim owed her a debt of $180,000, made her sign a debt contract, and threatened to go to the police if the victim did not continue to work to pay off the fabricated debt. The defendant beat the victim with nail salon tools, including cuticle clippers, nail files and brooms leaving the victim with scars, bruises and marks. She also threatened to ruin the victim’s reputation with her family by threatening to tell them information that would negatively impact the victim’s relationship with her family. The defendant’s scheme caused the victim to continue working for the defendant until a particularly violent assault led her to report the defendant to the Davidson Police Department.  

“This defendant used psychological coercion, debt bondage and violence to break down the will of one of her employees, exploit her vulnerabilities and force her to work long hours under threat of serious harm,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “There continues to be no place for such cruel conduct in our society, and the Department of Justice remains committed to identifying and eliminating human trafficking.”

“Human trafficking is human suffering and it has no place in modern society,” said U.S. Attorney Dena J. King of the Western District of North Carolina. “As our nation prepares to commemorate Juneteenth, it’s difficult to grasp that there are still people in our communities subjected to a life of servitude, compelled to work long hours for little or no pay, abused physically and mentally by those who ‘employ’ them. Traffickers who use their victims as commodities, take advantage of their needs and exploit their vulnerabilities for personal gain will be prosecuted to the fullest extent of the law.”

“Luong’s egregious criminal conduct is a form of human trafficking that not only exploited our nation’s labor laws, but also subjected the victim to unspeakable harm, including physical and mental abuse,” said Special Agent in Charge Ronnie Martinez, who oversees Homeland Security Investigations (HSI) operations in North Carolina and South Carolina. “Thankfully, HSI and its law enforcement partners have put an end to Luong’s activity and she is facing appropriately severe consequences. Pursuing human traffickers and protecting their victims remains a top priority of HSI.” 

Assistant Attorney General Clarke, U.S. Attorney King and Special Agent in Charge Martinez announced today’s sentence. The case was investigated by HSI with assistance from the Davidson Police Department and Charlotte-Mecklenburg Police Department. It was prosecuted by Assistant U.S. Attorney Kimlani M. Ford of the Western District of North Carolina and Trial Attorney Maryam Zhuravitsky of the Civil Rights Division’s Human Trafficking Prosecution Unit. Trial Attorney Jessica Arco of the Civil Rights Division’s Human Trafficking Prosecution Unit assisted with sentencing and restitution in this matter.

Anyone who has information about human trafficking should report that information to the National Human Trafficking Hotline toll-free at 1-888-373-7888, which is available 24 hours a day, seven days a week. For more information about human trafficking, please visit www.humantraffickinghotline.org.

The Justice Department has filed a complaint under the False Claims Act against American Health Foundation (AHF), its affiliate AHF Management Corporation, and three affiliated nursing homes — Cheltenham Nursing & Rehabilitation Center (Cheltenham), The Sanctuary at Wilmington Place (Wilmington Place) and Samaritan Care Center and Villa (Samaritan) — for providing grossly substandard skilled nursing services between 2016 and 2018. AHF is a nonprofit corporation that is headquartered in Dublin, Ohio, and owns and controls nursing homes in Ohio, Pennsylvania and Iowa. Cheltenham is a 255-bed nursing home located in Philadelphia; Wilmington Place is a 63-bed nursing home located in Dayton, Ohio; and Samaritan is a 56-bed nursing home located in Medina, Ohio.

In its complaint, the United States alleged the three AHF nursing homes provided grossly substandard services that failed to meet required standards of care in various ways. For example, the United States alleged the defendant facilities failed to follow appropriate infection control protocols and did not maintain adequate staffing levels. The United States also alleged that Cheltenham housed its residents in a dirty, pest-infested building; gave its residents unnecessary medications, including antibiotic, antipsychotic, anti-anxiety and hypnotic drugs; failed to safeguard residents’ personal possessions; subjected residents to verbal abuse; neglected to provide residents with activities or stimulation; and failed to provide needed psychiatric care. The United States similarly alleged that Wilmington Place and Samaritan failed to create and maintain important medical records, and that Wilmington Place repeatedly gave its residents unnecessary medications, including antibiotic, antipsychotic, anti-anxiety and hypnotic drugs, while also failing to ensure that its residents had the prescriptions they actually needed.

“Nursing homes are expected to provide their residents, which include some of our most vulnerable individuals, with quality care and to treat them with dignity and respect,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will not tolerate nursing homes — or their owners or managing entities — who abdicate these responsibilities and seek taxpayer funds to which they are not entitled.”   

The United States’ complaint provides specific allegations of how grossly substandard care harmed nursing home residents. For instance, the complaint alleged that one Cheltenham resident was admitted with a history of self-harm and was hospitalized after slashing his wrists while in the facility’s care. Yet when this resident returned to Cheltenham, the facility again ignored additional warning signs and failed to provide him with needed psychiatric services. Mere weeks after being readmitted to Cheltenham, the resident committed suicide by hanging himself from a bedsheet in one of Cheltenham’s shower rooms.  

The complaint is the result of an effort by the Civil Division’s Commercial Litigation Branch, Fraud Section, with assistance from the U.S. Department of Health and Human Services’ Office of Inspector General. This matter is being handled by Fraud Section attorneys Ben Young and Susan Lynch. 

The case is captioned United States v. American Health Foundation, Inc.; AHF Management Corporation; AHF Montgomery, Inc. d/b/a Cheltenham Nursing and Rehabilitation Center; and AHF Ohio, Inc. d/b/a/ The Sanctuary at Wilmington Place and Samaritan Care Center and Villa, No. 2:22-cv-02344 (E.D. Pa.).  

The United States’ complaint stems from an investigation that the Department of Justice initiated as part of its National Nursing Home Initiative. The department launched the initiative in March 2020 to identify and investigate nursing homes that provide grossly substandard care. The National Nursing Home Initiative reflects the Department of Justice’s commitment to protecting our nation’s seniors, coordinated by the department’s Elder Justice Initiative in conjunction with the U.S. Attorneys’ Offices. The Elder Justice Initiative supports the efforts of state and local prosecutors, law enforcement, and other elder justice professionals to combat elder abuse, neglect and financial exploitation, with the development of training, resources and information. Learn more about the Justice Department’s Elder Justice Initiative at http://www.justice.gov/elderjustice.

The claims in the complaint are allegations only, and there has been no determination of liability.

The Justice Department announced today that it has secured a settlement with the Groveport Madison Local School District Board of Education (the Board) in Groveport, Ohio. The settlement resolves the department’s complaint alleging that the Board violated Title VII of the Civil Rights Act of 1964 when it discriminated and retaliated against former Groveport Madison High School Assistant Principal Amon-Ra Dobbins. Title VII is a federal statute that prohibits employment discrimination on the basis of race, color, national origin, sex and religion and prohibits retaliation against employees for opposing employment practices that are discriminatory under Title VII.

“No employee should face discipline or reprisals for filing a complaint regarding a dress code policy that may be causing harm to Black students,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “We stand with those brave employees who oppose discrimination in the workplace and who work to ensure equal opportunity in all aspects of their jobs. This consent decree reflects the Civil Rights Division’s commitment to ensuring that no person should face retaliation for standing up against discrimination.”

“We are confident that the consent decree will lead to the development and equitable enforcement of policies that protect and promote the civil rights of all involved,” said U.S. Attorney Kenneth L. Parker for the Southern District of Ohio. “The consent decree provides a path for the school district and school board to achieve Title VII-compliant policies, procedures, and training.”

According to the complaint, which was filed in the U.S. District Court for the Southern District of Ohio, Dobbins was unfairly disciplined after he complained that the school district’s dress code policy was being implemented in a manner that discriminated against African-American students. The complaint alleges that the school district began to retaliate against Dobbins for complaining, and ultimately terminated his employment. Under the terms of the consent decree, if approved by the court, the Board will develop and submit to the United States for approval, its discrimination and retaliation policies, complaint investigation procedures, and proposed trainings that will be used by the Board and school district. The consent decree also requires the Board to provide training for all Board and school district employees on these policies and provides for future annual training. The Board will also pay Dobbins $200,000 in back pay and compensatory damages.

The Cleveland Field Office of the Equal Employment Opportunity Commission (EEOC) investigated and attempted to resolve Dobbins’s charge of discrimination before referring it to the Department of Justice as an enforcement action. More information about the EEOC’s jurisdiction is available on its website at www.eeoc.gov.

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 websites at  www.justice.gov/crt and www.justice.gov/crt/employment-litigation-section.

The case was brought by Trial Attorneys Ejaz Baluch Jr. and Jeffrey Morrison of the Civil Rights Division’s Employment Litigation Section.

The Justice Department today announced an agreement with the Township of Jackson, New Jersey, and the Jackson Planning Board to settle allegations that the Township and Planning Board violated the Religious Land Use and Institutionalized Persons Act (RLUIPA) and the Fair Housing Act (FHA) when they passed and applied a series of discriminatory zoning ordinances that intentionally targeted the Orthodox Jewish community by prohibiting religious schools and associated dormitories.

The proposed consent order, which was filed today in the U.S. District Court for the District of New Jersey and must still be approved by the court, would resolve a lawsuit the United States filed in May 2020 alleging that the Township and Planning Board passed zoning ordinances that broadly prohibited religious schools and banned schools with dormitories, both of which are important to providing religious education within the Orthodox Jewish community. The complaint alleged that the intent of the ordinances was to prevent Orthodox Jewish schools from opening in the Township and thereby dissuade members of that community from living in or moving to Jackson.

“Zoning restrictions that intentionally target religious communities have no place in our society,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “Federal civil rights laws provide strong protections to ensure that religious communities are treated equally and not subjected to discrimination because of their beliefs. This resolution reaffirms that members of the Orthodox Jewish community — as with people of all faiths — are welcome in our communities and have the right to practice their religion free of discrimination.”

“RLUIPA and the Fair Housing Act protect the rights of religious communities to worship and obtain housing in communities free from discrimination and unequal treatment,” said U.S. Attorney Philip R. Sellinger for the District of New Jersey. “This office remains steadfast in its commitment to enforce the nation’s civil rights laws, and as the proposed consent order demonstrates, we will continue to take steps to protect the civil rights of the Orthodox Jewish community and all communities throughout this district.”

The complaint alleges that in 2017, Jackson Township enacted two ordinances that banned dormitories and severely restricted where religious schools could locate. These ordinances were enacted in response to the growth of the Orthodox Jewish community in Jackson and surrounding areas and amid public comments arguing that the ordinances should be enacted to prevent the Orthodox Jewish community from living in or moving to Jackson. Township councilmembers voted unanimously to enact the ordinances.

The consent order requires Jackson Township to repeal the remaining active discriminatory ordinance and replace it with an ordinance that will allow religious elementary and secondary schools, religious higher learning institutions and religious residential schools. The consent order also requires that the new zoning ordinance treat religious schools equally with non-religious institutions that operate in the Township. Finally, the consent order requires the Township to train its officials and employees on the requirements of RLUIPA and the FHA, establish a procedure for receiving and resolving RLUIPA and FHA complaints, pay a civil penalty of $45,000, and pay $150,000 into a settlement fund from which aggrieved persons can seek payment.

Individuals who believe they have been subjected to discrimination in land use or zoning decisions, or discrimination in housing based on disability, race, color, religion, national origin, sex and familial status, may contact the Civil Rights Division Housing and Civil Enforcement Section at 1-833-591-0291, or the U.S. Attorney’s Office Civil Rights Hotline at (855) 281-3339. Individuals may also submit a complaint through the Civil Rights Division’s complaint portal or through the U.S. Attorney’s Office’s website.

The United States is represented by Assistant U.S. Attorney Kelly Horan Florio for the District of New Jersey, Senior Civil Rights Counsel in the U.S. Attorney’s Office’s Civil Rights Division, and Trial Attorneys Ryan G. Lee and David K. Gardner of the Civil Rights Division.

A federal court in the Eastern District of New York has permanently barred Brooklyn-based defendants Keith Sang, Kashana Sang, Tareek Lewis, Kimberly Brown and their business, K&L Accounting Group Inc., from preparing federal tax returns for others.

After bringing suit in July 2021 against the defendant return preparers and business, the United States obtained a preliminary injunction from the court to stop defendants from preparing returns while the litigation was pending. In issuing the preliminary injunction, the court found that (1) all defendants acted willfully or recklessly in preparing returns that understated their customers’ true tax liabilities; (2) defendants Keith Sang and Kashana Sang interfered with the administration of the internal revenue laws by preparing paper returns that did not identify the return preparer; and (3) all defendants took “concerted and conscious steps” to evade enforcement efforts by the IRS.  The defendants recently consented to entry of a permanent injunction.

Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer, has launched a free directory of federal tax preparers, and offers information on how to avoid “ghost” tax preparers, whose refusal to sign a return should be a red flag to taxpayers. The IRS also has a checklist of things to remember when filing income tax returns in 2022.

In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $73,000. For individuals whose income is over that threshold, IRS Free File offers electronical federal tax forms that can be filled out and filed online for free. The IRS has tips on how seniors and individuals with low to moderate income can get other help or guidance on tax return preparation, too.

In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.

Attorney General Merrick B. Garland met with representatives from the news media today following the recent notifications that the Justice Department had obtained reporter records in the course of leak investigations. As previously announced, the department will no longer use compulsory process to obtain reporters’ source information when they are doing their jobs.

The group had a productive conversation about the need for new rules implementing the policy change. During the discussion the department made clear that reporters were never the subject or the target of the recent investigations. The Attorney General and the media representatives agreed on the need for strong, durable rules.

In the coming weeks the Attorney General will develop and distribute to the field a memo detailing the current policy.  The Attorney General committed to working with members of the news media to codify the memo setting out these new rules into regulation.

Attending on behalf of the department, in addition to the Attorney General, were: Deputy Attorney General Lisa O. Monaco; John P. Carlin, Principal Associate Deputy Attorney General; Matthew Klapper, Chief of Staff to the Attorney General; Kate Heinzelman, Chief Counselor to the Attorney General; Anthony Coley, Director of Public Affairs and Senior Advisor to the Attorney General; Emily Loeb, Associate Deputy Attorney General; and David Newman, Associate Deputy Attorney General.

The news industry media representatives included: Bruce Brown, Executive Director, Reporters Committee for Freedom of the Press; AG Sulzberger, Chairman and Publisher, The New York Times; David McCraw, Deputy General Counsel, The New York Times; Fred Ryan, Publisher and CEO, The Washington Post; Sally Buzbee, Executive Editor, The Washington Post; Jay Kennedy, Vice President, General Counsel & Labor, The Washington Post; Sam Feist, Senior Vice President and Washington Bureau Chief, CNN; and David Vigilante, Executive Vice President and General Counsel, CNN.   

Kellogg Brown & Root Services Inc., headquartered in Houston, and three other companies have agreed to a settlement of $13.67 million to resolve a lawsuit seeking damages and penalties for alleged violations of the False Claims Act and the Anti-Kickback Act, and for breach of contract. The four named defendants are:  Kellogg Brown & Root Services Inc., Kellogg Brown & Root Inc., Kellogg Brown & Root LLC, and Overseas Administration Services Ltd. (collectively KBR). The settlement amount includes a payment of $12 million by KBR, in addition to $1.67 million in contract restitution that KBR previously paid to the United States relating to the subcontracts at issue in the lawsuit.  

The lawsuit concerned the Logistics Civil Augmentation Program (LOGCAP) III contract, under which KBR was required to provide logistics support to U.S. Army forces in Iraq, and subcontracts that KBR awarded to two local companies to perform work on its behalf:  Subcontracts 11 and 39 to La Nouvelle Trading & Contracting Co. (La Nouvelle), and Subcontracts 167 and 190 to First Kuwaiti Trading & Contracting Co., aka First Kuwaiti Trading Co. (First Kuwaiti). The United States asserted that certain KBR employees responsible for awarding these subcontracts rigged the bidding process in favor of La Nouvelle and First Kuwaiti, and that, to reward this favorable treatment, principal officers from the foreign subcontractors paid kickbacks to the responsible KBR employees. The United States also alleged that the subcontract prices were inflated, and that after the subcontracts were awarded, KBR employees extended the duration of the subcontracts at the inflated prices. The United States further contends that KBR sought reimbursement of these inflated costs through vouchers submitted to the Army. As alleged in the lawsuit, this conduct violated the False Claims Act and the Anti-Kickback Act, and breached the LOGCAP III contract.

“Those who do business with the government have a responsibility to ensure that they are properly performing and billing under their government contracts,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “This matter reflects the department’s commitment to hold accountable contractors that knowingly overcharge the government for inflated costs and that fail to take appropriate action to prevent their employees from enriching themselves at the public’s expense.”

“The Department of Defense – Office of Inspector General’s Defense Criminal Investigative Service (DCIS) and our law enforcement partners are steadfastly committed to holding contractors accountable when they abuse the trust of the military for financial gain,” said Acting Special Agent in Charge Gregory P. Shilling of the DCIS’s Southwest Field Office. “We will diligently investigate fraud perpetrated against the Department of Defense and the American taxpayer, regardless of the length of time it takes to ensure justice is served.”

“We are pleased with today’s settlement,” said Special Agent in Charge L. Scott Moreland of the U.S. Army Criminal Investigation Division (Army CID), Major Procurement Fraud Field Office. “Kickbacks and overcharges have an inherently corrosive effect and undermine the integrity of the procurement process; it is imperative that when someone contracts with the U.S. Army, they provide only their very best with no exceptions.”

More specifically, the settlement resolves allegations that a KBR employee entered into a kickback arrangement with the managing partner of First Kuwaiti, under which the KBR employee was to receive a kickback for every subcontract that he awarded to First Kuwaiti for the lease of trucks and trailers to transport fuel and refrigerated items into Iraq. The United States contends that, under the improper influence of this illegal arrangement, the KBR employee steered two truck-lease contracts (Subcontracts 167 and 190) to First Kuwaiti at higher prices than necessary to fulfill the Army’s contract requirements, and that KBR later sought to justify the high awards based on criteria that federal law did not permit KBR to consider. 

The settlement also resolves additional claims concerning these same subcontracts after they were awarded for the lease of trucks and refrigerated trailers. More specifically, KBR extended Subcontract 167 even though its employees knew that the leased equipment was no longer needed and had been returned to the subcontractor, billed the United States for this overpayment, and created false documents to justify the overpayment. KBR also extended Subcontract 190 for the continued lease of trucks to pull fuel tankers even though, the United States contends, its internal records showed that the vehicles had already been returned to First Kuwaiti, resulting in overcharges.

In addition, the United States contends that a second KBR employee rigged the bidding process for Subcontract 11, a subcontract for cleaning services at Camp Arifjan in Kuwait, so that the employee could justify awarding the subcontract to La Nouvelle. The KBR employee did this, the United States claims, with the intent to solicit kickbacks from La Nouvelle’s managing partner, who paid to reward the KBR employee for the favorable treatment he provided. The United States alleges that these kickbacks were included in the prices that KBR charged to the Government.

Finally, the United States contends that a third KBR employee rigged the bidding process for Subcontract 39, a contract for the lease of fuel storage tankers at a military airport in Kuwait, and awarded the subcontract to La Nouvelle at an inflated price, which KBR subsequently extended. As a reward for this favorable treatment, the United States alleges that the managing partner of La Nouvelle later paid the KBR employee a kickback, which was included within the prices that KBR charged to the Government.

In 2021, following more than seven years of litigation, the U.S. District Court for the Southern District of Texas granted partial summary judgment to the United States on several of its False Claims Act and Anti-Kickback Act claims. This settlement resolves these allegations and other pending claims and issues, for which trial had been scheduled to commence on May 23. The lawsuit is captioned United States ex rel. Conyers v. Kellogg Brown & Root, Inc., No. 4:06-cv-04024 (S.D. Tex.).

The resolution obtained in this matter was the result of efforts by the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, with assistance from DCIS and the U.S. Army CID.

The United States’ resolution in this matter follows a prior $51 million judgment in favor of the United States in a litigated proceeding before the Armed Services Board of Contract Appeals, concerning a larger overpayment that KBR made to First Kuwaiti under a separate subcontract in the Iraq Theater.  Following a multi-week trial and appeal to the U.S. Court of Appeals for the Federal Circuit, that judgment became final in 2021.

This matter was handled by Fraud Section Attorneys Ashley N. Bailey, Elspeth A. England, Glenn P. Harris, Russell B. Kinner, Jeffrey A. McSorley, Michael M. Sawers and David W. Tyler.

The claims resolved by the settlement are allegations only and there has been no determination of liability.

A former police officer with the Memphis Police Department was charged in an indictment unsealed today in the Western District of Tennessee for sexually assaulting a woman while he was on duty.

According to the indictment, Bridges Randle, 47, who has also used the names Ajamu Abiola Banjoko and Oluwafemi Abiola Banjoko, sexually assaulted the woman after he was dispatched to a vandalism call at the woman’s residence on June 24, 2000.

Randle is charged with committing a civil rights offense that included aggravated sexual abuse. If convicted, Randle faces a maximum sentence of life in prison. 

Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division, U.S. Attorney Joseph C. Murphy Jr. for the Western District of Tennessee and Special Agent in Charge Douglas Korneski for the FBI Memphis Field Office made the announcement.

This case is being investigated by the FBI’s Memphis Field Office. Assistant U.S. Attorney David Pritchard for the Western District of Tennessee and Trial Attorneys Maura White and Andrew Manns of the Criminal Section of the Civil Rights Division are prosecuting the case.

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

The former Chief Financial Officer of EarthWater Limited (EarthWater), a Dallas-based company, pleaded guilty on June 7 to 22 charges for a multimillion-dollar, high-yield investment fraud scheme that targeted elderly victims. In addition, another individual who sold EarthWater securities pleaded guilty today to one charge related to the investment fraud scheme.

According to court documents, Harley E. “Buddy” Barnes III, 63, of Plano, Texas, pleaded guilty to conspiracy, fraud, and money laundering charges. Barnes, who was EarthWater’s CFO, conspired to and obtained investor funds through a scheme to defraud. Relatedly, Joe Edward Duchinsky, 67, of Alhambra, California, who sold EarthWater securities, pleaded guilty to conspiracy to commit mail and wire fraud.

According to court documents, beginning in or about 2013 and continuing through or about May 2019, Barnes, as CFO of EarthWater, and Duchinsky, as a salesperson of EarthWater stock, participated in a fraudulent scheme to convince individuals in the United States, the United Kingdom, and Canada to invest in EarthWater under the false pretense that their investment would increase substantially in value in the immediate future. In connection with the scheme, Barnes, Duchinsky, and their co-conspirators made materially false and fraudulent misrepresentations to investors that the majority of investor funds would be used to support EarthWater’s operations. In fact, the funds were used to pay undisclosed, excessive commissions to Duchinsky and others for selling EarthWater stock on Barnes’s behalf. Barnes, Duchinsky, and their co-conspirators knew that the proceeds of EarthWater stock sales were not invested in EarthWater as described to victim investors, but rather paid out to Barnes, Duchinsky, and their co-conspirators and others for their personal benefit. Barnes also engaged in money laundering involving investor funds obtained as part of the scheme.

In addition, according to court documents, Beth Ellen DeGroot, 62, of Plano, Texas, EarthWater’s former President, pleaded guilty in a separate action on May 17 to conspiring with Barnes. After the company’s bank accounts were frozen, DeGroot conspired with Barnes to fraudulently direct EarthWater’s payroll processor to continue to pay Barnes and DeGroot’s paychecks even though the company’s operations had ceased, and it had insufficient funds to cover payroll. DeGroot also submitted a fraudulent mortgage loan application using pay stubs fraudulently obtained from the payroll processor. When DeGroot learned about the government’s ongoing investigation, she attempted to obstruct the investigation by falsifying a document she produced to a federal grand jury and by making a false statement to a federal agent.

Barnes pleaded guilty to one count of conspiracy to commit mail fraud and wire fraud, 10 counts of mail fraud, 10 counts of wire fraud, and one count of money laundering. He is scheduled to be sentenced on Sept. 28. Duchinsky pleaded guilty to one count of conspiracy to commit mail and wire fraud. He is scheduled to be sentenced at a later time. DeGroot pleaded guilty to one count of conspiracy to commit wire fraud and is scheduled to be sentenced on Sept. 14. Barnes faces up to 10 years in prison for the money laundering count and up to 20 years in prison for each of the other counts. Duchinsky and DeGroot each face up to 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Five other defendants have also pleaded guilty in the Northern District of Texas for their roles in the EarthWater high-yield investment fraud scheme, including EarthWater’s CEO, Cengiz Jan Comu, 61, of Dallas, Texas; EarthWater’s Chief Operating Officer, John Mervyn Price, 66, of Dallas, Texas; Donald Andrew Rothman, 74, of Coral Springs, Florida; Richard Laurence Kadish, 61, of Miami, Florida; and Richard Lawrence Green, 71, of Deerfield Beach, Florida. These five defendants are scheduled to be sentenced on Sept. 7.

Three other defendants are awaiting trial on charges set forth in a superseding indictment filed on Nov. 6, 2019, in the Northern District of Texas. The trial is scheduled to begin on Oct. 3. An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Chad E. Meacham for the Northern District of Texas; and Inspector in Charge Eric Shen of the U.S. Postal Inspection Service’s (USPIS) Criminal Investigations Group made the announcement.

USPIS is investigating the case.

Trial Attorneys Christopher Fenton and Theodore Kneller of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Mary F. Walters of the Northern District of Texas are prosecuting the case.

A Florida man pleaded guilty today to criminal contempt for continuing to prepare and file tax returns with the IRS in violation of a federal court order barring him from doing so.

According to court documents, Guy Telfort, of Fort Lauderdale, previously owned and operated Tax Houses and Accounting Services, a Lauderdale Lakes tax preparation business. From approximately January 2015 through April 2019, Telfort and other employees of Tax Houses and Accounting Services prepared and filed tax returns for clients. To generate inflated IRS refunds for clients, some of these tax returns reported false items, including fictitious business income and losses and mileage deductions. On April 24, 2019, the U.S. District Court for the Southern District of Florida entered an injunction against Telfort in a civil proceeding, permanently barring Telfort from preparing federal tax returns for others.

Despite this court-ordered injunction, in 2020 and 2021, Telfort continued to prepare and file tax returns out of an Oakland Park pawn shop. He charged clients as much as $1,000 for each return filed with the IRS. Some of the tax returns reported false medical and dental expenses and charitable contributions, as well as fictitious businesses. To disguise his role in preparing these returns, Telfort used Preparer Tax Identification Numbers belonging to other tax preparers. Over the two-year period, Telfort helped prepare nearly 1,200 tax returns for clients in willful violation of the permanent injunction.

Telfort is scheduled to be sentenced on Aug. 16 and potentially faces a period of incarceration, term of supervised release, and monetary fine. A district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Juan Antonio Gonzalez for the Southern District of Florida made the announcement.

Trial Attorneys Ashley Stein and Casey Smith of the Tax Division are prosecuting the case.

A Deputy U.S. Marshal has been charged by indictment with unlawfully obtaining cell phone location information by misusing a law enforcement service, and later making false statements about his use of that service.

Adrian Pena, 48, of Del Rio, Texas, made his initial appearance in federal court yesterday in the Western District of Texas.

According to court documents, Pena allegedly unlawfully used a law enforcement service operated by Securus Technologies Inc. (Securus) for personal reasons, including to obtain cell phone location information relating to multiple individuals with whom the defendant had personal relationships and their spouses. Pena obtained this information by uploading false and fraudulent documents to the Securus system and by certifying that those documents were official documents giving permission to obtain the relevant individuals’ cell phone location information. After this activity became known to law enforcement, Pena lied to law enforcement officials about his use of the Securus service for personal reasons, including to locate individuals with whom he was or had been in a personal relationship. Pena also drafted an affidavit in the name of one of these individuals and persuaded that individual to sign the affidavit, which falsely stated that the individual had given Pena unlimited access to all of that individual’s personal cell phone information at all times.

Pena is charged with 11 counts of obtaining confidential phone records, two counts of false statements, and one count of falsification of a record. If convicted, he faces up to 10 years in prison for each count of obtaining confidential phone records, up to five years in prison for each count of false statements, and up to 20 years in prison for falsification of a record. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division and Special Agent in Charge Cloey C. Pierce of the Department of Justice Office of the Inspector General (DOJ-OIG) Dallas Field Office made the announcement.

DOJ-OIG is investigating the case.

Deputy Chief Robert Heberle and Trial Attorney Nicole Lockhart of the Criminal Division’s Public Integrity Section are prosecuting the case.

An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

A federal judge in the Southern District of Mississippi unsealed an indictment in which the United States charged a California man and a Nevada woman with one count each of sex trafficking by force, fraud or coercion; conspiracy to commit sex trafficking by force, fraud and coercion; and interstate transportation for purposes of prostitution.  

According to the indictment, between April 2020 and June 2020, Michael Deon Fulcher, 52, and Jonzie Hamilton, 33, used force, fraud and coercion to cause an adult woman to engage in commercial sex acts in multiple states. 

The charge of sex trafficking by force, fraud or coercion carries a mandatory minimum sentence of 15 years and a maximum of life in prison, up to five years of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.  

The FBI is asking anyone with information about Michael Deon Fulcher and Jonzie Hamilton to contact the FBI Jackson Field Office at (601) 948-5000. If you or someone you know is a victim of human trafficking, please call the National Human Trafficking Hotline at 1-888-373-7888.

Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division, U.S. Attorney Darren J. LaMarca for the Southern District of Mississippi and Special Agent in Charge Jermicha L. Fomby for the FBI Jackson Field Office made the announcement. The FBI conducted the investigation with the assistance of the Mississippi Bureau of Investigation. Assistant U.S. Attorney Kathlyn Van Buskirk of the Southern District of Mississippi and Trial Attorney Kate Alexander of the Civil Rights Division’s Human Trafficking Prosecution Unit are prosecuting the case.

An indictment is merely an allegation, and the defendants are presumed innocent until proven guilty.

Last week, Assistant Attorney General (AAG) Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division convened a meeting in San Diego to highlight the progress of Joint Task Force Alpha (JTF Alpha) in recognition of the one-year anniversary since its formation.

AAG Polite brought senior leadership from the Justice Department and the U.S. Department of Homeland Security (DHS) together with members of the task force to discuss how to ensure that JTF Alpha is empowered to continue its significant progress moving forward. Participants included U.S. Attorneys Randy S. Grossman for the Southern District of California, who helped host the meeting, Jennifer Lowery for the Southern District of Texas, Ashley C. Hoff for the Western District of Texas; Chief Assistant U.S. Attorney Nicole Savel for the District of Arizona; Assistant Director Steve Cagen of U.S. Immigration and Customs Enforcement (ICE), Acting Commissioner Troy A. Miller of U.S. Customs and Border Protection (CBP), and interagency members of JTF Alpha.

Since its creation, JTF Alpha has successfully increased coordination and collaboration between the Justice Department and DHS, and with foreign law enforcement partners, including Mexico, Guatemala, El Salvador, and Honduras; targeted those organizations who have the most impact on the United States, and coordinated significant smuggling indictments and extradition efforts in U.S. Attorneys Offices across the country. JTF Alpha has been comprised of detailees from southwest border U.S. Attorney’s Offices, including the Southern District of Texas, the Western District of Texas, the District of Arizona, and the Southern District of California, and dedicated support for the program is also provided by numerous components of the Criminal Division that are part of JTF Alpha – led by the Human Rights and Special Prosecutions Section (HRSP), and supported by the Office of Prosecutorial Development, Assistance, and Training (OPDAT), the Narcotic and Dangerous Drug Section (NDDS), the Money Laundering and Asset Recovery Section (MLARS), the Office of Enforcement Operations (OEO), the Office of International Affairs (OIA), and the Organized Crime and Gang Section (OCGS). JTF Alpha is made possible by substantial law enforcement investment from DHS, FBI, Drug Enforcement Administration (DEA), and other partners.

Leading up to the meeting, AAG Polite led senior leaders from the Justice Department and DHS components in a visit to the southwest border in San Diego. AAG Polite and other senior leaders met with law enforcement officials at the border and received briefings on current operations. The tour provided an important perspective on challenges presented by transnational criminal organizations involved in human smuggling and other crimes who impact border security efforts by land, sea, and air.

“I am proud of the success of Joint Task Force Alpha,” said AAG Polite. “We are better at dismantling human smuggling and trafficking networks operating in Mexico, Guatemala, El Salvador, Honduras, and elsewhere because we are a stronger, unified law enforcement team. I believe our collective efforts to combat these crimes will continue to generate immediate results, while building towards greater, enduring positive impacts.”

At the outset of the meeting, AAG Polite expressed his appreciation for the broad and continued support of JTF Alpha and highlighted that, in its first year, this joint law enforcement effort has resulted in substantial disruption through specific and general deterrence – collaborating on numerous high priority investigations and cases of significant organizations and their key leaders and facilitators, resulting in dozens of arrests, indictments, and convictions both in the United States and with foreign law enforcement partners, along with obtaining substantial jail sentences and asset forfeiture. AAG Polite praised the partnership between a myriad of law enforcement agencies in attendance, including ICE Homeland Security Investigations (HSI), CBP, U.S. Coast Guard, the FBI, and the DEA in concert with JTF Alpha prosecutors, to tackle this important mission. 

The U.S. Attorneys, Chief Assistants, and their designated JTF Alpha prosecutors spoke about smuggling trends and challenges in their respective districts and ways to better employ JTF Alpha resources. ICE Assistant Director Cagen and CBP Acting Commissioner Miller spoke about the need to continue coordinating law enforcement counter-network strategies and prioritizing support for JTF Alpha. 

Participants discussed ways to further advance JTF Alpha’s mission to enhance U.S. enforcement efforts against the most prolific and dangerous human smuggling and trafficking networks operating in Mexico, Guatemala, El Salvador, and Honduras; and to identify ways to strengthen efforts to disrupt and dismantle those human smuggling and trafficking networks that abuse or exploit those being smuggled, pose national security risks, or have links to transnational organized crime. 

JTF Alpha leadership provided an assessment of the initiative’s progress thus far and its plans to continue and enhance its work; and prosecutors and agents presented case studies and discussed various investigations and successful cases including: A Bangladeshi national sentenced to 46 months in prison for his role in a scheme to smuggle undocumented individuals from Mexico into the United States, the takedown of a prolific transnational human smuggling organization operating in Nogales, Sonora, along the U.S.-Mexico border, the over 38-year prison sentence of a Cuban national who was using his border ranch as a criminal corridor to further his drug trafficking and human smuggling activities, and the sentencing of two human smugglers responsible for attempting to smuggle 14 Mexican citizens by sea to the shores of La Jolla, California, resulting in the tragic drowning death of a 43-year-old passenger, the guilty pleas and sentencings in Arizona of individuals involved in human smuggling organizations responsible for smuggling, transporting, and harboring over 100 undocumented nationals from Guatemala and Mexico, and the indictment of eight defendants on charges of human smuggling and drug smuggling for their involvement in an international scheme to smuggle 24 undocumented individuals and cocaine from Honduras into Louisiana via boat. Additionally, JTF Alpha leadership identified enhancements made to increase the efficiencies of the Task Force model at the local and national level and discussed ways to better foster interagency collaboration to target criminal organizations involved in smuggling and related crimes in and through the region.

The meeting ended with a commitment of continued support for JTF Alpha’s work and that of the assigned prosecutors devoted to the task force from each district. ICE Assistant Director Cagen and CBP Acting Commissioner Miller committed to ensuring that law enforcement strategies prioritize JTF Alpha support, enhance information sharing, and focus on investigative collaboration. AAG Polite confirmed that the Criminal Division, including numerous components that participate in the initiative, remains steadfast in its support and prioritization of JTF Alpha and assured everyone that the department is focused on its continued success. AAG Polite also thanked the meeting attendees for their valuable and faithful service, and for the professionalism and inestimable dedication of the prosecutors, agents, analysts, and all other personnel supporting JTF Alpha.  

A federal court permanently enjoined a Colchester, Vermont, compounding pharmacy from distributing drugs unless they are manufactured in compliance with the Federal Food, Drug and Cosmetic Act (FDCA), the Justice Department announced.

In a complaint filed May 20, the United States alleged that Edge Pharm Inc., and its owners and operators Marc Chatoff and Kurt Radke, violated the FDCA by manufacturing and distributing adulterated and misbranded drugs, by causing drugs to become adulterated and misbranded while held for sale, and by introducing new unapproved drugs into interstate commerce. According to the complaint, the defendants manufactured injectable drugs intended to be sterile under conditions that fell short of the minimum requirements to ensure sterility. The complaint further alleged that U.S. Food and Drug Administration (FDA) inspections of the Edge facility between 2014 and 2021 revealed record-keeping violations, labelling inadequacies, improper airflow, structural disrepair and the presence in cleanroom suites of mold species that can cause diseases in humans which may be deadly to immunocompromised patients.  

“Compounding pharmacies must ensure that their products are safe,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will continue to work closely with the FDA to ensure that drugs are compounded in compliance with the law.”

“Edge Pharma LLC has put patients’ lives at risk by repeatedly producing drugs under insanitary conditions and failing to follow good manufacturing practice requirements,” said Director Donald Ashley of the Center for Drug Evaluation and Research (CDER) Office of Compliance. “While compounded drugs are not FDA-approved, all drug firms must prioritize patient safety, which Edge Pharma has been unable to do. This consent decree ensures that Edge Pharma will be held accountable, and FDA will continue to take all necessary steps within our regulatory authority to protect the health of the American public.”

The defendants did not admit or deny the allegations in the government’s complaint, but agreed to settle the suit and be bound by a consent decree of permanent injunction. The consent decree requires, among other things, that the defendants stop manufacturing and distributing drugs until they take specific remedial measures and demonstrate to the FDA that they will comply with federal law. Judge Chief Judge Geoffrey W. Crawford of the U.S. District Court for the District of Vermont entered the order against the defendants.  

The government was represented by Trial Attorney David G. Crockett of the Civil Division’s Consumer Protection Branch, with the assistance of Claudia Zuckerman of the FDA’s Office of Chief Counsel. The U.S. Attorney’s Office for the District of Vermont provided valuable assistance.

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

A California man pleaded guilty yesterday in connection with a scheme to defraud investors in a publicly traded company’s securities and manipulate the company’s stock price.  

According to court documents, Jason Nielsen, 55, of Scotts Valley, was a large shareholder of Arrayit, a publicly traded medical device company based in California. From approximately 2019 through April 2020, Nielsen engaged in an unlawful “scalping” and “spoofing” scheme to manipulate the price of Arrayit securities. Nielsen used online message boards to publicly post false and misleading information about the nature of his trading in Arrayit securities, in order to induce others to purchase Arrayit securities and thereby drive up the stock’s price, a practice known as “scalping.” 

Nielsen admitted that he placed orders to buy Arrayit stock that he intended to cancel before execution. The purpose of these orders was to deceive the public and Arrayit shareholders by signaling demand for Arrayit securities which did not exist. This allowed Nielsen to sell his shares at artificially inflated prices, a practice known as “spoofing.” While engaged in these practices, Nielsen was secretly selling his own previously acquired shares at an artificially inflated price.

Nielsen pleaded guilty to one count of securities fraud. He is scheduled to be sentenced on Oct. 24 and faces a maximum penalty of five years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Stephanie M. Hinds for the Northern District of California; Special Agent in Charge Steven Ryan of the Department of Health and Human Services – Office of Inspector General (HHS-OIG); Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division; Special Agent in Charge Sean Ragan of the FBI’s San Francisco Field Office; Inspector in Charge Eric Shen of the U.S. Postal Inspection Service’s Criminal Investigations Group; Special Agent in Charge Kim Lampkins of the Department of Veterans Affairs – Office of Inspector General (VA-OIG), Mid-Atlantic Field Office; and Special Agent in Charge Bryan Denny of the Department of Defense Office of Inspector General’s (DoD OIG) Defense Criminal Investigative Service (DCIS) made the announcement.

HHS-OIG’s San Francisco Regional Office and Detroit Regional Office, U.S. Postal Inspection Service, the FBI, VA-OIG and DCIS investigated the case.

Acting Principal Assistant Chief Justin Weitz, Assistant Chief Jacob Foster, and Trial Attorney Laura Connelly of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Lloyd Farnham of the Northern District of California are prosecuting the case. 

The Fraud Section is using the Victim Notification System (VNS) to provide victims with case information and updates related to this case. Victims with questions may contact the Fraud Section’s Victim Assistance Unit by calling the Victim Assistance phone line at 1-888-549-3945 or by emailing Victimassistance.fraud@usdoj.gov. To learn more about victims’ rights, please visit: https://www.justice.gov/criminal-vns/victim-rights-derechos-de-las-v-ctimas. If you believe you are a victim, please visit https://www.justice.gov/criminal-vns/case/Nielsen.

The Department of Justice today announced that the U.S. District Court for the Middle District of Florida has entered a consent order resolving the department’s Fair Housing Act claims against Advocate Law Groups of Florida P.A. (ALGF); Jon B. Lindeman Jr.; Ephigenia K. Lindeman; Summit Development Solutions USA LLC (SDS) and Haralampos “Bob” Kourouklis. The department’s lawsuit alleged that defendants discriminated on the basis of national origin when they targeted Hispanic homeowners for predatory mortgage loan modification services and interfered with those individuals’ ability to keep their homes.

The department alleged in its complaint that defendants targeted Hispanic homeowners with Spanish-language advertising that falsely promised to cut their mortgage payments in half. Defendants made the same representations to hundreds of Hispanic homeowners in person, promising lower payments in exchange for thousands of dollars of upfront fees and continuing monthly fees of as much as $550, which defendants claimed were “non-refundable.” Many of the targeted homeowners had limited English proficiency. The department’s complaint further alleged that defendants directed these homeowners not to communicate with their lenders and to stop making their monthly mortgage payments. According to the complaint, defendants did little or nothing to obtain the promised loan modifications for the homeowners, many of whom defaulted on their mortgage payments and ultimately lost their homes.

“Targeting homeowners with deceptive advertisements and predatory schemes because of their national origin and limited English proficiency is reprehensible and illegal,” said Assistant Attorney General Kristen Clarke for the Civil Rights Division. “Homeowners of color and other protected groups must be safeguarded from discriminatory targeting that can lead to grave financial loss, including loss of one’s home. We will continue to use our federal civil rights laws to protect the rights of homeowners.”

“This settlement, reached in partnership with the Civil Rights Division’s Housing Section, is a major achievement for our Civil Division and its Civil Rights Unit,” said U.S. Attorney Roger B. Handberg for the Middle District of Florida. “We are committed to using every legal tool available, including the Fair Housing Act, to ensure that our residents enjoy their right to housing without discriminatory practices of this kind.”

The Justice Department brought this suit after Lucía Hurtado, Noemí Román, Argentina Roque and members of their families filed complaints of discrimination with the Department of Housing and Urban Development (HUD). After HUD investigated the complaints, it issued charges of discrimination and referred the matter to the Justice Department for litigation. Hurtado, Román and Roque later intervened as plaintiffs in the department’s lawsuit.

“It is outrageous that these defendants engaged in business practices that were not only illegal and discriminatory, but also resulted in hard-working homeowners defaulting on their mortgages and losing their homes due to foreclosure,” said Demetria McCain, HUD’s Principal Deputy Assistant Secretary for Fair Housing and Equal Opportunity. “HUD commends the Justice Department for its commitment to enforcing the Fair Housing Act and for protecting the fair housing rights of all who call America home.”

The consent order enters a judgment against defendants for $4,595,000 to compensate people who were harmed by defendants’ conduct. Of that amount, defendants must pay a total of $95,000 to the three intervenors, plus a civil penalty to the United States. Most of the monetary judgment is suspended based on evidence of defendants’ limited net worth, including financial statements signed by defendants under penalty of perjury. The consent order requires defendants to submit updated financial statements each year during the five-year term of the settlement. If the court determines that defendants made any material misrepresentations or omissions in their original financial statements or in the annual updates, the entire judgment will be reinstated, and defendants will be immediately liable for the full amount.

In addition to monetary relief, the consent order permanently enjoins defendants from providing any mortgage relief assistance services, such as loan modifications or foreclosure defense services, and imposes reporting and recordkeeping requirements for defendants’ other real-estate activities.

This case was litigated by attorneys in the department’s Civil Rights Division and the U.S. Attorney’s Office for the Middle District of Florida.

The Civil Rights Division enforces the Fair Housing Act, which prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. More information about the Civil Rights Division and the laws it enforces is available at http://www.justice.gov/crt. Individuals may report sexual harassment or other forms of housing discrimination by calling the Justice Department’s Housing Discrimination tip line at 1-833-591-0291, or submitting a report online. Individuals may also report such discrimination by contacting HUD at 1-800-669-9777 or by filing a complaint online.

In 2019, the Justice Department announced that it would not pursue federal criminal civil rights charges against the two U.S. Park Police officers involved in the fatal shooting of Bijan Ghaisar during a traffic stop on Nov. 17, 2017. Following an extensive independent investigation, the department determined in 2019 that there was insufficient evidence to establish a willful violation of the applicable federal criminal civil rights statute. Yesterday, Assistant Attorney General Kristen Clarke for the Justice Department’s Civil Rights Division informed counsel for Ghaisar’s family that the department will not be reopening the federal investigation at this time.

To prevail under the federal civil rights statute, the Justice Department must prove that an officer, acting under color of law, willfully used unreasonable force. To establish willfulness, federal authorities must show that the officer acted with the deliberate and specific intent to do something the law forbids. This is one of the highest standards of intent imposed by law. Mistake, misperception, negligence or poor judgment are not sufficient to establish a federal criminal civil rights violation. Federal officials determined that this legal standard could not be met and closed the investigation in 2019.

After the federal investigation was closed, the Commonwealth of Virginia initiated a criminal prosecution of the two officers involved in Ghaisar’s tragic death, charging them with involuntary manslaughter and reckless use of a firearm. The state prosecution was then transferred to the U.S. District Court for the Eastern District of Virginia. On Oct. 22, 2021, after consideration of evidentiary motions and briefs filed by the defendants and the Commonwealth, the U.S. District Court dismissed the Commonwealth’s criminal charges after finding the subject officers’ conduct was “necessary and proper” and “in accordance with federal law.”

Given the totality of the evidence reviewed, including the evidence amassed during the prior federal investigation, material submitted to the District Court, and the District Court’s findings and dismissal, the department does not have an adequate basis to reopen its prior investigation. The Justice Department remains committed to investigating allegations of unreasonable force by law enforcement officers and will continue to devote the resources required to ensure that all allegations of civil rights violations are thoroughly examined.

El Departamento de Justicia anunció hoy que el Tribunal Federal de Distrito para el Distrito Central de Florida ha firmado una orden por consentimiento que resuelve las reclamaciones al amparo de la ley de Vivienda Justa contra Advocate Law Groups of Florida, P.A. (ALGF); Jon B. Lindeman, Jr.; Ephigenia K. Lindeman; Summit Development Solutions USA LLC (SDS) y Haralampos “Bob” Kourouklis. El pleito del Departamento alegó que los demandados habían discriminado por motivos de origen nacional al señalar como blanco a propietarios hispanos para servicios abusivos de modificación de préstamos hipotecarios e interferir en la capacidad de tales individuos de conservar sus casas.

En su demanda, el Departamento alegó que los demandados habían señalado como blanco a propietarios hispanos mediante anuncios en español que les hacían la promesa falsa de reducir sus pagos hipotecarios a la mitad. Los demandados indicaron lo mismo en persona ante cientos de propietarios hispanos, prometiéndoles pagos más bajos a cambio de miles de dólares por concepto de comisiones iniciales y cuotas mensuales regulares de hasta $550, lo que los demandados mantenían que “no era reembolsable”. Muchos de los propietarios seleccionados tenían un dominio limitado del inglés. Más aún, la demanda del Departamento alegó que los demandados les indicaron a estos propietarios que no se comunicaran como sus prestamistas y que dejaran de efectuar sus pagos hipotecarios mensuales. Según consta en la demanda, los demandados no hicieron nada o hicieron poco para obtener las prometidas modificaciones de préstamo para los propietarios, muchos de los que incumplieron en los pagos hipotecarios y que, finalmente, perdieron sus hogares.

“Señalar como blanco a propietarios mediante anuncios engañosos y planes abusivos debido a su origen nacional y dominio limitado del inglés es reprobable e ilegal”, declaró Kristen Clarke, la Fiscal General Auxiliar de la División de Derechos Civiles. “Los propietarios de color y otros grupos protegidos deben quedarse protegidos de focalización discriminatoria que puede llevar a pérdidas financieras graves, incluyendo la pérdida de la casa de uno. Nosotros seguiremos empleando nuestras leyes federales de derechos civiles para proteger los derechos de los propietarios”.
 

“Este acuerdo, alcanzado con la colaboración de la Sección de Vivienda de la División de Derechos Civiles, representa un gran logro para nuestra División Civil y su Unidad de Derechos Civiles”, afirmó el Fiscal Federal para el Distrito Central de Florida, Roger B. Handberg. “Estamos comprometidos a usar cada herramienta legal que tengamos a nuestra disposición, incluyendo la ley de Vivienda Justa, para garantizar que nuestros residentes puedan disfrutar de sus derechos a la vivienda sin ser sometidos a prácticas discriminatorias de esta naturaleza”.

El Departamento de Justicia entabló este pleito después de que Lucía Hurtado, Noemí Román, Argentina Roque y miembros de sus familias presentaron quejas de discriminación ante el Departamento de Vivienda y Desarrollo Urbano (HUD, por sus siglas en inglés). Después de investigar las quejas, HUD emitió denuncias de discriminación y refirió el caso al Departamento de Justicia para litigio. Más adelante, Hurtado, Román y Roque intervinieron como demandantes en el pleito del Departamento.

“Es increíble que estos demandados emplearan prácticas empresariales que no solo eran ilícitas y discriminatorias sino que también resultaron en el incumplimiento por parte de propietarios trabajadores en sus hipotecas y tales personas perdieron sus casas a la ejecución hipotecaria”, comentó Demetria McCain, la Secretaria Adjunta Auxiliar Principal del HUD para la Vivienda Justa y la Igualdad de Oportunidades. “HUD elogia al Departamento de Justicia por su compromiso a hacer cumplir la ley de Vivienda Justa y por proteger los derechos de vivienda justa de todos los que viven en este país”.

La orden por consentimiento registra una sentencia contra los demandados que asciende a $4,595,000 para indemnizar a las personas perjudicadas por la conducta de los demandados. De ese monto, los demandados deberán pagar un total de $95,000 a los tres interventores, además de una sanción civil a los Estados Unidos. La mayoría de la sentencia monetaria se ha suspendido debido a pruebas del patrimonio neto limitado de los demandados, incluyendo extractos financieros firmados por los demandados bajo pena de perjurio. La orden por consentimiento requiere que los demandados entreguen extractos financieros actualizados cada año durante el plazo de cinco años de vigencia del acuerdo. Si el tribunal determina que los demandados han tergiversado u omitido algo en sus extractos financieros originales o en sus actualizaciones anuales, la sentencia completa se reinstalará y los demandados serán inmediatamente responsables por el monto completo.

Además de la indemnización, la orden por consentimiento prohíbe de modo permanente que los demandados presten servicios de ayuda hipotecaria, tales como servicios de modificación de hipoteca o protección contra la ejecución hipotecaria e impone requisitos de declaración y mantenimiento de registros para las demás actividades inmobiliarias de los demandados.

Este caso fue litigado por abogados de la División de Derechos Civiles del Departamento y de la Fiscalía Federal para el Distrito Central de Florida.

La División de Derechos Civiles hace cumplir la ley de Vivienda Justa, la cual prohíbe la discriminación en la vivienda por motivos de raza, color de piel, religión, origen nacional, género, discapacidad o situación familiar. Para más información acerca de la División de Derechos Civiles y las leyes que hace cumplir, vaya a https://www.justice.gov/crt-espanol. Los individuos pueden reportar incidentes de acoso sexual u otras formas de discriminación llamando a la línea informativa del Departamento de Justicia para discriminación en la vivienda al 1-833-591-0291 o entregando un informe en línea. También se puede denunciar tal discriminación llamando a HUD, al 1-800-669-9777 o rellenando un formulario de demanda en línea.

Five subsidiaries of Westlake Chemical Corporation — Westlake Chemical OpCo LP, Westlake Petrochemicals LLC, Westlake Polymers LLC, Westlake Styrene LLC, and Westlake Vinyls Inc. — have agreed to make upgrades and perform compliance measures estimated to cost $110 million to resolve allegations that they violated the Clean Air Act and state air pollution control laws at two of their petrochemical manufacturing facilities located in Lake Charles, Louisiana, and one facility in Calvert City, Kentucky. The Westlake companies will also pay a $1 million civil penalty. The settlement will eliminate thousands of tons of air pollution from flares.

According to the complaint, also filed today by the United States, the Commonwealth of Kentucky, and the State of Louisiana, the companies failed to properly operate and monitor their industrial flares, which resulted in excess emissions of harmful air pollution at the three facilities. The company regularly “oversteamed” the flares and failed to comply with other key operating constraints to ensure the volatile organic compounds (VOCs) and hazardous air pollutants (HAPs) contained in the gases routed to the flares are efficiently combusted. 

“This settlement demonstrates that the Department of Justice and Environmental Protection Agency are committed to addressing excessive and harmful air pollution from improperly operated petrochemical flares,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “The settlement’s significant reductions of hazardous and other air pollutants and greenhouse gases will serve to reduce exposure in the vulnerable nearby communities with environmental justice concerns.”

“This settlement will require the Westlake companies to install pollution control and emissions monitoring equipment at the three facilities, reducing emissions of greenhouse gases and other harmful gases by thousands of tons per year,” said Acting Assistant Administrator Larry Starfield for the EPA's Office of Enforcement and Compliance Assurance. “Those controls, plus a requirement for fence line monitoring of benzene emissions and corrective actions when benzene readings are high, will result in significant benefits for the local communities in Kentucky and Louisiana.”

The settlement requires the three facilities to install and operate air pollution control and monitoring technology to reduce flaring and the resulting harmful air pollution from eight flares at the three facilities. Once fully implemented, the pollution controls are estimated to reduce emissions of ozone-forming VOCs by 2,258 tons per year and of toxic air pollutants, including benzene, by 65 tons per year. The settlement is also expected to reduce emissions of climate-change-causing greenhouse gases, including carbon dioxide, methane and ethane, by over 50,733 tons per year.

This settlement also contains innovative injunctive relief measures that continue this administration’s efforts to use enforcement to reduce the impacts of harmful pollutants on overburdened communities and to fight climate change by reducing the emission of greenhouse gases. The significant emissions reductions of VOCs and HAPs secured at the facilities serve to reduce exposure in the community to some of the same air pollutants to which they are disproportionately exposed. The improved combustion efficiency requirements, flare gas recovery system, requirements to reduce flaring, and limits on flaring included in the settlement will reduce the carbon footprint of all three facilities.

The Westlake companies will perform air quality monitoring that is designed to detect the presence of benzene at the fence lines of the three facilities. Monitoring results must be posted to a publicly available website, providing the neighboring communities with more information about their air quality. The monitoring requirements also include triggers for root cause analysis and corrective actions if fence line emissions exceed certain thresholds. Flare compliance is an ongoing priority for the EPA under its Creating Clean Air for Communities National Compliance Initiative.

The pollutants addressed by the settlement can cause significant harm to public health. VOCs are a key component in the formation of smog or ground-level ozone, a pollutant that irritates the lungs, exacerbates diseases such as asthma, and can increase susceptibility to respiratory illnesses, such as pneumonia and bronchitis. Chronic exposure to benzene, which EPA classifies as a carcinogen, can cause numerous health impacts, including leukemia and adverse reproductive effects in women. Flares are also often large sources of greenhouse gas emissions.

Flares are devices used to combust waste gases that would otherwise be released into the atmosphere during certain industrial operations. Well-operated flares should have high “combustion efficiency,” meaning they combust nearly all harmful waste gas constituents, like VOCs and HAPs, and turn them into water and carbon dioxide. The agreement  — the eighth of its kind since 2013 —  is designed to improve the Westlake companies’ flaring practices. First, it requires the company to minimize the amount of waste gas that is sent to the flares, which reduces the amount of flaring. Second, the company must improve the combustion efficiency of its flares when flaring is necessary. The Westlake companies will take several steps to minimize the waste gas sent to its flares at each facility. All three facilities will operate a flare gas recovery system that recovers and “recycles” the gases instead of sending them to be combusted in a flare. The flare gas recovery system will allow Westlake to reuse these gases as a fuel at its facilities or a product for sale. For flaring that must occur, the agreement requires that the Westlake companies install and operate instruments and monitoring systems to ensure that the gases sent to its flares are efficiently combusted.

The consent decree, lodged in the Western District Court of Louisiana, is subject to a 30-day public comment period and final court approval. The consent decree will be available for viewing at https://www.justice.gov/enrd/consent-decrees.

A New Jersey man pleaded guilty to various charges stemming from his sale of more than $2.7 million worth of various unregistered pesticides to numerous victims based on false representations that these products were registered pesticides with the Environmental Protection Agency (EPA), and on EPA’s “List N: Disinfectants for Use Against SARS-CoV-2” that EPA deemed to be effective against SARS-CoV-2 (Coronavirus).

Paul Andrecola, 63, of Maple Shade, New Jersey, pleaded guilty before U.S. District Court Judge Robert B. Kugler in Camden federal court to an information charging him with one count of knowingly distributing or selling an unregistered pesticide in violation of the Federal Insecticide, Fungicide and Rodenticide Act (FIFRA), one count of wire fraud and one count of presenting false claims to the United States.

“Andrecola not only cheated dozens of people out of millions of dollars, but also endangered the health of those who relied on his fraudulent virucidal products,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “The Department of Justice is committed to prosecuting such crimes to the fullest extent possible.”

“Paul Andrecola’s scheme profited on the fears of the American people during the height of public safety concerns about the transmission of COVID-19,” said U.S. Attorney Philip Sellinger for the District of New Jersey. “Our office is dedicated to protecting public health and prosecuting to the full extent of the law those who commit such egregious criminal acts.”

“Today’s announcement represents the largest pandemic fraud case related to the sale of unregistered pesticides charged nationwide,” said Special Agent in Charge Tyler Amon of EPA’s Criminal Investigation Division in New Jersey. “This case underscores EPA’s commitment with our law enforcement partners to hold violators accountable when they undercut the level playing field used by law abiding companies to ensure the integrity and safety of their products.” 

According to documents filed in this case, and statements made in court:

FIFRA provides for federal regulation of pesticide distribution, sale and use. The purpose of FIFRA is to ensure that pesticides sold in the United States are safe, effective and bear labeling containing true and accurate information. The EPA has responsibility under FIFRA to regulate the manufacture, labeling and distribution of all pesticides shipped or received in interstate commerce.

Under FIFRA, all pesticides must be registered with the EPA before the pesticide can be sold or distributed, and no person may distribute or sell a pesticide that has not been registered with the EPA. Moreover, before pesticide products can legally make claims that they can kill a particular pathogen such as SARS-CoV-2, the claim must be authorized by EPA based on a review of data. In March 2020, at the beginning of the global pandemic, the EPA created a list of EPA-registered products that it deemed to be effective against SARS-CoV-2, titled “List N: Disinfectants for Use Against SARS-CoV-2.” The EPA has continued to update this list since its creation.

Andrecola, who owns and operates three companies based in Mount Laurel, New Jersey, manufactured various disinfectant products, including liquids and wipes, under the brand name “GCLEAN.” GCLEAN products were unregistered pesticides under FIFRA and none of the products were on EPA’s “List N of Disinfectants for Use Against SARS-CoV-2.” Rather, Andrecola placed another company’s EPA Registration Numbers on his company’s products, and falsely marketed that his products were EPA-approved to kill Coronavirus by creating numerous false documents to support his claims. Specifically, Andrecola, or others at his behest, would provide this falsified documentation to potential customers, falsely representing that various sanitizer and wipe products in the names GCLEAN and/or GC200 were EPA-registered products on EPA’s “List N: Disinfectants for Use Against SARS-CoV-2,” to persuade them to purchase the unregistered pesticide products.

From approximately March 2020 through May 2021, Andrecola used these fraudulent representations to make more than 150 sales of unregistered pesticides for a profit of more than $2.7 million The purchasers of these unregistered pesticides included a police department in Delaware, a fire department in Virginia, a medical clinic in Georgia, a janitorial supply company in New York, a school district in Wisconsin, as well as numerous U.S. government agencies (namely, the U.S. Marshal’s Service, Moody Air Force Base, the Department of Veterans Affairs and the National Forest Service).  

The count of illegal sale of an unregistered pesticide carries a statutory maximum prison sentence of one year, and a fine of up to $25,000. The charge of wire fraud is punishable by a maximum potential penalty of 20 years in prison and the count of false claims against the United States is punishable by a maximum potential penalty of five years in prison. Both the charges of wire fraud and false claims against the United States are each also subject to fines of the greater of $250,000, twice the gross profits to Andrecola, or twice the gross loss suffered by the victims, whichever is greatest.

As part of the plea agreement, the defendant agreed to forfeit more than $2.7 million of the proceeds from the sale of the illegal product and to make full restitution for all losses resulting from his commission of the charged crimes.

The government is represented by Trial Attorneys Adam C. Cullman and Matthew D. Evans of ENRD’s Environmental Crimes Section and Special Assistant U.S. Attorney Jason P. Garelick of the U.S. Attorney’s Economic Crimes Unit in Newark.

The case was investigated by the EPA’s Criminal Investigation Division, with assistance from EPA’s Office of the Inspector General, Eastern Region; the Homeland Security Investigations Newark Field Office; the Defense Criminal Investigative Service Northeast Field Office; the Naval Criminal Investigative Service Northeast Field Office and the Mount Laurel Police Department.

A Gulfport, Mississippi, man pleaded guilty today to preparing false federal tax returns for clients.

According to court documents and statements made in court, Orland Reed worked at a Gulfport tax return preparation business. Between 2012 and 2014, Reed prepared tax returns for clients that included false household help income, education credits, dependent information and federal income tax withholdings, in an effort to generate larger refunds from the IRS than the clients were entitled to receive. At times, Reed also listed a different tax preparer even though he prepared the returns himself.

In addition to preparing false tax returns, on at least two occasions Reed diverted for his own use clients’ refunds that were sent by the IRS to the tax preparation business in the form of prepaid debit cards. Reed withdrew some of the funds on the cards before delivering them to the clients.

Reed is scheduled to be sentenced on Sept. 22 and faces a maximum penalty of three years in prison for helping his clients file false returns. He also faces a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Darren J. LaMarca for the Southern District of Mississippi made the announcement.

IRS Criminal Investigation is investigating the case.

Trial Attorney Kevin Schneider of the Tax Division and Assistant U.S. Attorney Stan Harris for the Southern District of Mississippi are prosecuting the case.

A federal jury in Detroit convicted a Michigan man today for a wire fraud and money laundering scheme to obtain more than $4.1 million in Paycheck Protection Program (PPP) and the Economic Injury Disaster Loan (EIDL) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.  

According to court documents and evidence presented at trial, Johnny Ho, 41, of Novi, engaged in a conspiracy to submit falsified PPP and EIDL loan applications in order to obtain COVID-19 relief funds that he was not entitled to receive. The evidence showed that Ho, who owned Diva Nails & Spa III LLC, located in Northville, submitted inflated payroll information, and otherwise falsified loan application information. Ho personally submitted two fraudulent PPP and EIDL loan applications seeking nearly $350,000 in funds that were intended to help small businesses and their employees impacted by the COVID-19 pandemic. In total, Ho and his co-conspirators submitted 29 different fraudulent PPP and EIDL loan applications on behalf of 16 businesses totaling over $4.1 million.

Ho was convicted of one count of conspiracy to commit wire fraud, two counts of wire fraud, and two counts of money laundering. He is scheduled to be sentenced on Sept. 27 and faces up to 20 years in prison for each of the wire fraud counts, and up to 10 years in prison on the money laundering counts. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Dawn Ison for the Eastern District of Michigan; Special Agent in Charge James A. Tarasca of the FBI’s Detroit Field Office; and Special Agent in Charge Sharon Johnson of the SBA-Office of Inspector General (SBA-OIG) made the announcement.

The case was investigated by the FBI and the SBA-OIG.

Trial Attorney Patrick J. Suter of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Ryan A. Particka for the Eastern District of Michigan are prosecuting the case.  

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

A Nevada man pleaded guilty yesterday to aggravated identity theft, wire fraud and money laundering. On March 28, he pleaded guilty to a separate indictment charging him with filing false tax returns with the IRS on behalf of clients, aggravated identity theft, wire fraud and impersonating an FBI agent.

According to court documents, King Isaac Umoren, 41, of Las Vegas, owned and operated Universal Tax Services (UTS), a tax preparation business. From 2012 through 2016, Umoren prepared and filed with the IRS tax returns for clients that included false deductions and fictitious businesses, in an effort to generate larger refunds than the clients were entitled to receive. At times, Umoren used the names and IRS preparer tax identification numbers of other UTS employees without their knowledge or consent, making it seem as if they, not he, had prepared the false returns. On Feb. 7, 2016, Umoren posed as an FBI agent, wearing a fake badge and tactical gear, and drove to a client’s house with police lights attached to his vehicle to demand payment of a tax preparation fee. Umoren required his clients to use a refund anticipation check program, which he utilized at times to secretly take fees out of clients’ tax refunds without their knowledge.

In May 2016, Umoren attempted to sell UTS. To induce potential buyers to purchase the company at an inflated price, he provided fraudulent documents — including forged bank statements, fabricated return preparation fee reports, false personal tax returns and other tax forms that had never actually been filed with the IRS — as well as the stolen tax and personal identifying information of approximately 12,000 taxpayers who were not UTS clients. Eventually, Umoren succeeded in inducing a victim to purchase UTS and received more than $3.8 million in the sale. Umoren used the sale proceeds to purchase land in Henderson, Nevada, and an automobile.

Umoren is scheduled to be sentenced on all charges on Nov. 2. He faces a maximum sentence of five years in prison on each count of helping file a false tax return for others, three years in prison for impersonating a federal agent, 10 years in prison for each money laundering count, 20 years in prison on each of the wire fraud counts, and a mandatory minimum sentence of at least two years in prison based on the aggravated identity theft counts. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Jason M. Frierson for the District of Nevada made the announcement.

IRS-Criminal Investigation, the Treasury Inspector General for Tax Administration, and the FBI are investigating the case.

Trial Attorneys Sarah A. Kiewlicz and Patrick Burns of the Tax Division are prosecuting the case.

The Justice Department announced today that it has opened a pattern or practice investigation into the Louisiana State Police (LSP). This civil investigation will assess whether LSP uses excessive force and whether it engages in racially discriminatory policing. The investigation will include a comprehensive review of LSP policies, training, supervision, and force investigations, as well as LSP’s systems of accountability, including misconduct complaint intake, investigation, review, disposition, and discipline.

“Protecting the civil rights of all Americans and building trust between law enforcement and the communities they serve are among the Justice Department’s most important responsibilities,” said Attorney General Merrick B. Garland. “This investigation, like all of our pattern or practice investigations, will seek to promote the transparency, accountability, and public trust that is essential to public safety.”

“Every American, regardless of race, has the right to constitutional policing,” said Assistant Attorney General Kristen Clarke of the Justice Department's Civil Rights Division. “Based on an extensive review of publicly available information and information provided to us, we find significant justification to investigate whether Louisiana State Police engages in excessive force and engages in racially discriminatory policing against Black residents and other people of color. The Justice Department stands ready to use every tool in our arsenal to confront allegations of misconduct and to ensure legitimacy during encounters with law enforcement.”

The investigation is being conducted pursuant to the Violent Crime Control and Law Enforcement Act of 1994, which prohibits state and local governments from engaging in a pattern or practice of conduct by law enforcement officers that deprives individuals of rights protected by the Constitution or federal law. The statute allows the Department to remedy such misconduct through civil litigation. The Department will be assessing law enforcement practices under the Fourth and Fourteenth Amendments to the U.S. Constitution, as well as under the Safe Streets Act of 1968 and Title VI of the Civil Rights Act of 1964.

The investigation is separate from any federal criminal investigation of LSP troopers. 

Prior to the announcement, Department officials informed Governor John Bel Edwards, Colonel Lamar Davis, and Deputy General Counsel Gail Holland of the investigation. They pledged to cooperate with the investigation. As part of this investigation, the Department officials will reach out to community groups and members of the public to learn about their experiences with LSP.

The Special Litigation Section of the Department of Justice Civil Rights Division and the U.S. Attorney’s Offices for the Eastern, Middle, and Western Districts of Louisiana will jointly conduct this investigation. Individuals with relevant information are encouraged to contact the Department of Justice via email at Community.Louisiana@usdoj.gov or by phone at (202) 353-0684. Individuals can also report civil rights violations regarding this or other matters using the Civil Rights Division’s reporting portal, available at civilrights.justice.gov.

Information specific to the Civil Rights Division’s Police Reform Work can be found here: /media/872116/dl?inline. 

Four former prison officials have been sentenced to prison for smuggling drugs and other contraband into Leavenworth Detention Center (Leavenworth), a privately run, maximum-security federal prison in Kansas.

Janna Grier, 36, of Horton, Kansas, was sentenced to two years in prison today for conspiracy to solicit bribes and provide contraband to inmates of a federal prison. According to court documents, Grier used her position as a correctional officer at Leavenworth to smuggle contraband into the prison and also solicited other prison officials to use their positions to smuggle contraband into Leavenworth.

Jeane Arnette, 61, of Leavenworth, was sentenced to six months in prison today for conspiracy to provide contraband to inmates of a federal prison. According to court documents, Arnette used her position as a nurse at Leavenworth to smuggle contraband — including cell phones — into the prison.

Jacqueline Sifuentes, 26, of Laredo, Texas, and Cheyonte Harris, 29, of Raytown, Missouri, each used their position as a correctional officer at Leavenworth to smuggle contraband — including methamphetamine, marijuana, and tobacco — into the prison in exchange for bribes from inmates and their associates. Sifuentes was recently sentenced to 14 months in prison, and Harris was recently sentenced to 20 months in prison.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, Special Agent in Charge William J. Hannah of the Department of Justice Office of Inspector General (DOJ-OIG) Chicago Field Office, Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division, and Special Agent in Charge Charles A. Dayoub of the FBI’s Kansas City Field Office made the announcement.

The FBI and DOJ-OIG investigated the cases.

Trial Attorneys Rebecca M. Schuman, Jacob R. Steiner, and Lauren Castaldi of the Justice Department’s Public Integrity Section prosecuted the cases.

The cases are part of the Justice Department’s ongoing efforts to combat prison corruption. In addition to the above matters, the Public Integrity Section recently obtained convictions against two other former Leavenworth Detention Center correctional officers for similar conduct. See United States v. Willie Golden, Case No. 2:21-cr-20061 (D. Kan.); and United States v. Angelica Grant, Case No. 2:22-cr-20010 (D. Kan.). Separately, the Public Integrity Section has obtained convictions against four former North Carolina prison officials who smuggled contraband, including narcotics, into a state facility in exchange for bribes. See United States v. Ollie Rose, III, Case No. 4:20-CR-96 (E.D.N.C.); United States v. Kenneth Farr, Case No. 4:21-CR-9 (E.D.N.C.); United States v. Warren Reed, Case No. 4:21-CR-36 (E.D.N.C.); and United States v. Jeremy Chambers, Case No. 4:21-CR-38 (E.D.N.C.).

A Michigan return preparer pleaded guilty today to preparing a false tax return for a client.

According to court documents, Daneilla Allen co-owned All Star Tax Services, a return preparation business with locations in Michigan and Ohio. As part of her plea, Allen admitted that from 2014 through 2018 she prepared and filed false tax returns with the IRS for clients. The false tax returns contained fictitious business income and expenses, and false itemized deductions and education credits, in an effort to generate larger refunds than her clients were entitled to receive. Even after IRS special agents informed Allen she was the subject of a criminal investigation, she continued to prepare false returns for clients in 2020 and 2021. Allen admitted to causing a total tax loss to the IRS of more than $815,000.

Allen is scheduled to be sentenced on Sept. 7. She faces a maximum penalty of three years in prison for assisting the filing of a false tax return. She also faces a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division made the announcement.

IRS-Criminal Investigation is investigating the case.

Trial Attorneys Jeffrey A. McLellan and Sam Bean of the Tax Division are prosecuting the case.