Eastern District of Pennsylvania

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Matthew Laver, age 38, of Souderton, in Montgomery County, PA, entered a plea of guilty before United States District Judge Michael Baylson to multiple counts of distribution, receipt, and possession of child pornography.

The defendant was indicted in March 2019 after an investigation into the defendant’s collection of almost 4,000 images and videos depicting the sexual abuse of children that he downloaded and distributed to other users on the internet over approximately ten years. The investigation revealed that Laver trafficked in child pornography that depicted children as young as infants being sexually assaulted and raped, and that he did so during the time that he was employed as a Montgomery County Sheriff’s Officer.

“The harm caused by child exploitation is devastating and long-lasting, which is why we prosecute these cases aggressively,” said First Assistant U.S. Attorney Williams. “In this case, the conduct was particularly egregious because the defendant was a member of a law enforcement organization charged with enforcing the law. We stand ready with our federal and local partners to identify and prosecute all those who would prey upon minor children.”

“Law enforcement officers take an oath to serve and protect, thus our conduct must be beyond reproach ,” said Marlon V. Miller, special agent in charge of HSI Philadelphia. “Homeland Security Investigations special agents worked closely with our law enforcement partners to further prevent this perpetrator from victimizing children by distributing images of sexual assault.”

This case is part of Project Safe Childhood (PSC), a nationwide program bringing together all levels of law enforcement and the communities they serve to reduce sexual crimes against children. The Department of Justice and U.S. Attorney’s Offices work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce sexual crimes against children.

The case was investigated by the Department of Homeland Security and the Abington Police Department, and is being prosecuted by Assistant United States Attorneys Eileen Zelek and Michelle Rotella.

PHILADELPHIA – United States Attorney William M. McSwain announced that Dino Paolucci, 41, of Mississauga, Ontario, entered a plea of guilty to four counts of securities fraud before United States District Judge Eduardo C. Robreno.

The charges resulted from the defendant’s participation in a scheme to manipulate the price and trading volume of the stocks of LiveWire Ergogenics (“LVVV”), YaFarm Technologies (“YFRM”), Resource Ventures (“REVI”), and Medical Cannabis Payment Solutions (“REFG”). This type of scheme is commonly referred to as a “pump-and-dump.”

During the course of the scheme, Paolucci, a stock promoter, worked with others to artificially increase the price and volume of the stocks through the use of false and misleading press releases, email blasts, radio advertisements and tweets, often in coordination with planned trading by other participants in the scheme. The misleading promotion in concert with planned trading was designed to control the price and volume of the stock. In order to hide their scheme from investors and regulators, Paolucci and his fellow schemers used offshore corporations and brokerage accounts, intermediaries, and even fake names, causing tens of millions of dollars of losses to investors while gaining millions in profits for themselves.

“Stock fraud is a danger to free markets and to individual investors, and our securities laws must be vigorously enforced to protect the public,” said U.S. Attorney McSwain. “Those who defraud investors and harm our securities markets will be tracked down and brought to justice, just as Paolucci was here.”

The case was investigated by the Federal Bureau of Investigations, with assistance from the Securities and Exchange Commission. It is being prosecuted by Assistant United States Attorneys Patrick Murray and Judy Smith.

PHILADELPHIA – United States Attorney William M. McSwain announced that defendant Jack Russell Bristol, 62, of Troy, Pennsylvania, was sentenced to thirty years’ incarceration and ten years’ supervised release by United States District Court Judge Gerald J. Pappert for child exploitation offenses.

The defendant was arrested by the Department of Homeland Security Investigations as part of an online investigation involving the sexual exploitation and trafficking of children via live-streaming webcams. For more than a year, the defendant paid for live-streamed sex shows that featured children in the Philippines. The defendant sought out young girls, some as young as 8 years of age, and paid their adult handlers to have the girls strip on camera, masturbate, and engage in sex acts with other children and with adults. The investigation confirmed that Bristol spent approximately $600 every month for these live-streamed shows, and over the last few months before his arrest, had repeated contact with two sisters who were just 12 and 14 years old.

As part of his abuse of these girls, the defendant made arrangements to travel to the Philippines, where he had paid to stay with a host family that had five girls, all under the age of 18. Bristol’s plan was to have sex with the two sisters he had been communicating with online, but he was intercepted by federal agents in Philadelphia as he attempted to board a plane to the Philippines.

Bristol confessed to agents on the day of his arrest, and later pleaded guilty to all three charges in the Indictment, for which he was sentenced today: two counts of using the Internet to entice a minor to engage in sexual conduct, and one count of attempted foreign travel to engage in illicit sexual activity with a minor.

“Child predators often go to extreme lengths to get what they want, and this case is a prime example of that – this defendant was ready to travel literally to the other side of the globe,” said U.S. Attorney McSwain. “We stand ready with our federal and local partners to identify and prosecute those who would prey upon minor children.”

“Protecting children from predators is a top priority for Homeland Security Investigations,” said Marlon V. Miller, Special Agent in Charge of HSI Philadelphia. “Today’s sentencing demonstrates that we will not tolerate the sexual abuse of children anywhere in the world. HSI will vigorously investigate anyone who attempts to travel overseas to exploit and take advantage of children.”

This case is part of Project Safe Childhood (PSC), a program bringing together all levels of law enforcement and the communities they serve to reduce the sexual exploitation and abuse of children. The case was investigated by the Department of Homeland Security Investigations, and is being prosecuted by Assistant United States Attorney Michelle Rotella.

PHILADELPHIA – United States Attorney William M. McSwain announced that Robert Brennan, 81, of Perryville, MD, was arrested and charged by Indictment with four counts of making materially false statements in a matter within the jurisdiction of the executive branch of the United States government.

The Indictment alleges that on or about April 25, 2019, Brennan was interviewed by the Federal Bureau of Investigation and made a number of false statements to the investigating agents.  Brennan had served in the Archdiocese of Philadelphia from 1993 to 2004 as a priest at Resurrection of Our Lord parish (“Resurrection”).  In September 2013, the Philadelphia District Attorney’s Office filed criminal charges against him, alleging that he had sexually abused a minor, Sean McIlmail, during Brennan’s time at Resurrection.  Soon thereafter, on or about October 13, 2013, Sean McIlmail died of a drug overdose and the criminal charges against Brennan were dismissed.

In November 2013, the McIlmail family filed a civil lawsuit against the Archdiocese of Philadelphia and Brennan.  The lawsuit was settled for an undisclosed amount on or about May 2, 2018.

During the April 25, 2019 interview with the FBI, Brennan made several allegedly false statements that prior to the filing of the 2013 criminal case and civil lawsuit against him, he did not know Sean McIlmail, his father, mother or brother.  Brennan was arrested in Maryland this morning and is being transported to Philadelphia for his initial appearance in federal court today at 1:30 p.m.

“Making false statements to the FBI is a serious crime, and given the circumstances, the alleged false statements here are particularly disturbing,” said U.S. Attorney McSwain.  “We will use all of the tools at our disposal to hold this defendant accountable for his alleged actions.”

“The defendant allegedly lied to the FBI to obstruct an investigation into complaints that he sexually abused a child while serving as a priest,” said Attorney General Josh Shapiro. “I’m proud to work with our federal partners to hold him accountable. Our Office will investigate and prosecute anyone who abuses children, takes advantage of their position of power, or gives false statements to law enforcement, no matter who they are.”

 “Lying to federal agents threatens the integrity of our justice system,” said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. “That’s precisely why it’s a crime. The FBI can't properly carry out investigations, if the people we interview think they can deceive us without consequence.”

If convicted, the defendant faces a maximum possible sentence of 32 years’ imprisonment, a $1,000,000 fine, and 3 years’ supervised release.

The case was investigated by the Federal Bureau of Investigation, with assistance from the Pennsylvania Attorney General’s Office, and is being prosecuted by Assistant United States Attorney Michelle L. Morgan.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Andrew Harris, 23, of Philadelphia, entered a plea of guilty before United States Judge Cynthia M. Rufe on the charges related to violations of 18 U.S.C. § 1030 for using a school computer and someone else’s username without that person’s permission in an attempt to illegally obtain President Donald Trump’s tax returns from the Internal Revenue Service. Harris’ co-defendant, Justin Hiemstra, previously pleaded guilty on August 6, 2019.

These charges arose out of a plot between the defendant, then a student at Haverford College, and Hiemstra (another Haverford College student), to use computers at the school’s computer lab and the Free Application for Student Aid (FAFSA) website to illegally access the tax returns. The defendants opened a false FAFSA application in the name of a member of the Trump family, and found that someone else had already obtained a username and password for Donald Trump. In order to reset the password, the defendants were prompted to answer challenge questions, which the original person had created when setting up the account. They were able to answer the questions and reset the password, and then used the President’s personal identifier information, including his social security number and date of birth, to attempt to import the President’s federal tax information into the bogus FAFSA application. Ultimately, this illegal attempt failed.

“No matter what you think about the President’s tax returns, clearly this kind of illegal activity cannot be tolerated or condoned. Unauthorized or false attempts to obtain any citizen’s IRS filings are a serious violation of privacy rights and a federal crime, and there’s nothing funny about it,” said U.S. Attorney McSwain. “Now this un-funny plot has branded both Harris and his cohort, Hiemstra, with federal criminal convictions that they deserve.”

The case was investigated by the Department of Education – Office of Inspector General and the Treasury Inspector General for Tax Administration, and is being prosecuted by Assistant United States Attorney Anthony J. Wzorek.

PHILADELPHIA – United States Attorney William M. McSwain announced that Jacoya Brazzle, 31, of Coatesville, Pennsylvania, was sentenced to eight months’ incarceration, five years supervised release and full restitution by United States Timothy J. Savage for stealing money from a veteran patient in her care.

The defendant was a nursing assistant at the VA Medical Center (VAMC) in Coatesville. As part of her duties, she was assigned to care for a veteran who uses a wheelchair. Brazzle learned the veteran’s ATM card PIN number, and used his ATM card to access his account – withdrawing funds on more than 10 occasions from ATMs in the Coatesville area over a two month timespan. In all, the defendant stole approximately $11,000 from the victim’s bank account.

“Our veterans deserve our gratitude for their service, and it goes without saying that they deserve safe and trustworthy care at VA Medical Centers,” said U.S. Attorney McSwain. “The defendant’s conduct here – stealing from a wheelchair-bound veteran in her care – is reprehensible. My Office will investigate and prosecute any crimes against veterans to the fullest extent possible.”

“VA employees that take advantage of vulnerable veterans in their care will not be tolerated,” said Special Agent in Charge Sean J. Smith, Department of Veterans Affairs, Office of Inspector General, Criminal Investigations Division, Northeast Field Office.

The case was investigated by the Office of Inspector General for the U.S. Department of Veterans Affairs, and is being prosecuted by Assistant United States Attorney Nancy Rue.

Pharmaceutical company Mallinckrodt ARD LLC (formerly known as Mallinckrodt ARD Inc. and previously Questcor Pharmaceuticals Inc. "Questcor"), has agreed to pay $15.4 million to resolve claims that Questcor paid illegal kickbacks to doctors, in the form of lavish dinners and entertainment, to induce prescriptions of the company’s drug, H.P. Acthar Gel (Acthar) from 2009 through 2013. 

The Federal Anti-Kickback Statute prohibits a pharmaceutical company from offering or paying, directly or indirectly, any remuneration — which includes money or any other thing of value — with the intent to induce a health care provider to prescribe a drug reimbursed by a federal health care program, including Medicare. This prohibition extends to such practices as “wining and dining” doctors to induce them to write Medicare prescriptions of a company’s products. 

The government alleged that, from 2009 to 2013, twelve Questcor sales representatives marketing Acthar provided illegal remuneration to health care providers in the form of lavish meals and entertainment expenses.  The company paid this remuneration, the government alleges, with the intent to induce Acthar Medicare referrals from those health care providers, resulting in a violation of the Anti-Kickback Statute and the submission of false claims to Medicare.

“The Department of Justice will hold companies accountable for the payment of illegal kickbacks in any form,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “Improper inducements have no place in our federal healthcare system, which depends on physicians making decisions based on the healthcare needs of their patients and not on or influenced by personal financial considerations.” 

“When companies buy off doctors, patients suffer.  My Office is committed to rooting out this type of behavior and the Anti-Kickback Statute is a critical tool in that fight,” said U.S. Attorney McSwain.  “We will continue to protect the integrity of our healthcare system by holding drug companies accountable for their conduct.”

“Paying kickbacks to win business, as contended in this case, cheats taxpayers and the patients who rely on government health care programs for essential care,” said Maureen R. Dixon, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “We will continue working with our law enforcement partners to hold accountable entities paying such kickbacks.”

The allegations that are the subject of yesterday’s settlement were originally alleged in two cases filed under the whistleblower, or qui tam, provision of the False Claims Act.  The act permits private parties to sue for fraud on behalf of the United States and to share in any recovery.  The act also permits the government to intervene in such actions, as the government previously did in the two whistleblower cases.  The whistleblowers will receive approximately $2.926 million of the settlement.  The government is continuing to pursue claims in these two matters alleging that Mallinckrodt violated the False Claims Act by using a foundation as a conduit to pay illegal kickbacks in the form of copay subsidies for Acthar.  These claims are not being resolved by the settlement. 

The government’s pursuit of these matters illustrates the government’s emphasis on combating healthcare fraud.  One of the most powerful tools in this effort is the False Claims Act.  Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800‑HHS‑TIPS (800-447-8477). 

This matter is being handled by the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office for the Eastern District of Pennsylvania, with assistance from the U.S. Department of Health and Human Services Office of Inspector General.  The two lawsuits are captioned United States of America ex rel. Strunck et al. v. Mallinckrodt ARD, Inc., No. 12-CV-0175 (E.D. Pa.) and United States of America ex rel. Clark v. Questor Pharmaceuticals, Inc., No. 13-CV-1776 (E.D. Pa.). 

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

PHILADELPHIA – United States Attorney William M. McSwain announced today that pharmaceutical company Mallinckrodt ARD LLC (formerly known as Mallinckrodt ARD, Inc. and previously Questcor Pharmaceuticals, Inc. (“Questcor”)), has agreed to pay $15.4 million to resolve claims that Questcor paid illegal kickbacks to doctors from 2009 through 2013 in the form of lavish dinners and entertainment, to induce prescriptions of the company’s drug, H.P. Acthar Gel (“Acthar”) for the treatment of complications from multiple sclerosis.

The Federal Anti-Kickback Statute prohibits a pharmaceutical company from offering or paying, directly or indirectly, any remuneration—which includes money or any other thing of value—with the intent to induce a health care provider to prescribe a drug reimbursed by Medicare. This prohibition extends to such practices as “wining and dining” doctors to induce them to write Medicare prescriptions of a company’s products.

The government alleges that, from 2009 to 2013, twelve Questcor sales representatives marketing Acthar provided illegal remuneration to health care providers in the form of lavish meals and entertainment expenses. The company paid this remuneration, the government alleges, with the intent to induce Acthar Medicare referrals from those health care providers, resulting in a violation of the Anti-Kickback Statute and the submission of false claims to Medicare.

“Federal law protects patients from medical providers who write prescriptions so they can enrich themselves and from drug companies who do not play by the rules in their marketing and promotional efforts,” said U.S. Attorney McSwain. “Kickback schemes are a form of illegal pay-to-play business practices that have no place in our health care system; they interfere with physician-patient relationships and drive up the cost of health care.”

“The Department of Justice will hold companies accountable for the payment of illegal kickbacks in any form,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “Improper inducements have no place in our federal healthcare system, which depends on physicians making decisions based on the healthcare needs of their patients and not on or influenced by personal financial considerations.” 

“Paying kickbacks to win business, as contended in this case, cheats taxpayers and the patients who rely on government health care programs for essential care,” said Maureen R. Dixon, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “We will continue working with our law enforcement partners to hold accountable entities paying such kickbacks.”

The allegations relevant to this settlement were originally alleged in two cases filed under the whistleblower, or qui tam, provision of the False Claims Act. The act permits private parties to sue for fraud on behalf of the United States and to share in any recovery. The act also permits the government to intervene in such actions, as the government previously did in the two whistleblower cases, which are captioned United States of America ex rel. Strunck et al. v. Mallinckrodt ARD, Inc., No. 12-CV-0175 (E.D. Pa.), and United States of America ex rel. Clark v. Questor Pharmaceuticals, Inc., No. 13-CV-1776 (E.D. Pa.). The government’s pursuit of these matters illustrates its emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800 HHS TIPS (800-447-8477). The whistleblowers will receive approximately $2.926 million of the settlement.

This matter is being handled by the Civil Division of the U.S. Attorney’s Office for the Eastern District of Pennsylvania and the Department of Justice’s Commercial Litigation Branch, with assistance from the U.S. Department of Health and Human Services’ Office of Inspector General, the Defense Criminal Investigative Service, the Federal Bureau of Investigation and the Office of Personnel Management. For the United States Attorney’s Office, the matter is being handled by Assistant United States Attorney Colin Cherico and Auditor George Niedzwicki.

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

PHILADELPHIA – United States Attorney William M. McSwain announced that Jason Muzzicato, 43, of Bangor, Pennsylvania was charged by Superseding Indictment with possession of firearms by an unlawful user of a controlled substance, and knowingly operating an aircraft when not registered. Muzzicato was also previously charged in June with possession of firearms by a person subject to a court order restraining him from harassing, stalking and threatening an intimate partner (known as a domestic violence protective order, Protection From Abuse order or PFA), and possession of an unregistered destructive device (an improvised explosive device). These charges are pending before United States District Judge Joseph F. Leeson in Allentown, Pennsylvania.

The charges against the defendant stem from his possession of firearms and homemade bombs, while subject to the terms of a PFA order issued by the Northampton County Court of Common Pleas, and while being an unlawful user of methamphetamine. Under federal law, an individual who is subject to a PFA order is prohibited from possessing firearms. The defendant is also charged with unlawful operation of an unmanned aerial vehicle (drone). As alleged in the Superseding Indictment, the defendant possessed a DJI, Model Phantom 3, unmanned aerial vehicle (drone), seven improvised explosive devices and ten firearms, including multiple AR-15 rifles and semi-automatic pistols.

“It does not take much imagination to conjure up the enormous harm that can result from the combination of illegal firearms, explosives, and drone aircrafts,” said U.S. Attorney McSwain. “Adding methamphetamine and a disregard of court orders to the mix only serves to heighten the risk. Here the defendant’s alleged behavior violated the law and threatened public safety.”

If convicted, the defendant faces a maximum possible sentence of 33 years’ imprisonment, three years’ supervised release, a $760,000 fine, and a $400 special assessment.

The case was investigated by the Federal Bureau of Investigation, Allentown Resident Agency; the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Reading Field Office; the Department of Transportation, Office of Inspector General, Fort Washington Field Office; the Washington Township Police Department; the Pennsylvania State Police; and the Bethlehem Fire Department, and is being prosecuted by Assistant United States Attorney John Gallagher.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

David Sommers, 64, of Levittown, Pennsylvania, was sentenced to six months imprisonment, three years of supervised release including six months of home detention, and to pay $250,000 in restitution for trafficking protected turtles.

From November 2011 until October 2017, Sommers poached thousands of protected diamondback terrapins and their eggs from coastal marshes in New Jersey and illegally sold the turtles.  A grand jury indicted Sommers on July 10, 2018 for his criminal conduct involving the sale, export and false-labeling of packages containing protected diamondback terrapins.  On Feb. 4, 2019, Sommers pleaded guilty to false-labeling of packages containing protected diamondback terrapins.

“Sommers used a sham business to shamelessly mask an illegal trade in threatened and protected species,” said Assistant Attorney General Jeffrey Bossert Clark of the Justice Department’s Environment and Natural Resources Division.  “The Justice Department and our law enforcement partners will safeguard our nation’s natural resources and biodiversity and prosecute wildlife traffickers to the fullest extent of the law.”

“The defendant had a simple business plan: poach protected turtles and their eggs from their natural habitat, advertise them for sale online and then illegally ship them to customers by concealing the actual contents of the packages,” said U.S. Attorney William M. McSwain for the Eastern District of Pennsylvania.  “Sommers represented himself as a legitimate reptile breeder, when he was in fact endangering the lives of these animals and breaking the law.  Thanks to our partners at the New Jersey Division of Fish and Wildlife and the United States Postal Inspection Service, this defendant will be held responsible for his actions.”

Diamondback terrapins (Malaclemys terrapin) are a semi-aquatic species of turtle native to brackish waters in eastern and southern United States.  They are not found in the wild in Pennsylvania, where Sommers resided, but have a dwindling habitat range in neighboring New Jersey.  The terrapins are prized in the reptile pet trade for their unique, diamond-shaped shell markings.  The turtles are protected under New Jersey law and by an international treaty, the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).

The United States, Canada and approximately 181 other countries are signatories to CITES, which provides a mechanism for regulating international trade in species whose continued survival is threatened by such trade.  Due to declining populations, CITES listed the diamondback terrapin as threatened in 2013, and New Jersey banned collecting, possessing and transporting them in 2016. 

This case was investigated by the United States Fish and Wildlife Service with assistance from the New Jersey Division of Fish and Wildlife.  It is being prosecuted by trial attorney Ryan Connors of the Justice Department’s Environmental Crimes Section and Assistant U.S. Attorney Joan E. Burnes.

PHILADELPHIA – United States Attorney William M. McSwain announced that David Sommers, 64, of Levittown, PA was sentenced to six months’ imprisonment, three years’ supervised release including six months’ home detention, and $250,000 restitution by United States District Judge Anita B. Brody for trafficking protected turtles.

From November 2011 until October 2017, the defendant poached thousands of protected diamondback terrapins and their eggs from coastal marshes in New Jersey and illegally sold the turtles. A grand jury indicted Sommers on July 10, 2018 for his criminal conduct involving the sale, export, and false-labeling of packages containing protected diamondback terrapins. On February 4, 2019, Sommers pleaded guilty to false-labeling of packages containing protected diamondback terrapins.

During the sentencing hearing, the government offered evidence that the total market value of the defendant’s sales figures and inventory of poached wildlife was worth well over $550,000.

“The defendant had a simple business plan: poach protected turtles and their eggs from their natural habitat, advertise them for sale online and then illegally ship them to customers by concealing the actual contents of the packages,” said U.S. Attorney McSwain.  “Sommers represented himself as a legitimate reptile breeder, when he was in fact endangering the lives of these animals and breaking the law.  Thanks to our partners at the New Jersey Division of Fish and Wildlife and the United States Postal Inspection Service, this defendant will be held responsible for his actions.”

“Sommers used a sham business to shamelessly mask an illegal trade in threatened and protected species,” said Assistant Attorney General Jeffrey Bossert Clark of the Justice Department’s Environment and Natural Resources Division.  “The Justice Department and our law enforcement partners will safeguard our nation’s natural resources and biodiversity and prosecute wildlife traffickers to the fullest extent of the law.”

Diamondback terrapins (Malaclemys terrapin) are a semi-aquatic species of turtle native to brackish waters in eastern and southern United States. They are not found in the wild in Pennsylvania, where Sommers resided, but have a dwindling habitat range in neighboring New Jersey. The terrapins are prized in the reptile pet trade for their unique, diamond-shaped shell markings. The turtles are protected under New Jersey law and by an international treaty, the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES).

The United States, Canada, and approximately 181 other countries are signatories to CITES, which provides a mechanism for regulating international trade in species whose continued survival is threatened by such trade. Due to declining populations, CITES listed the diamondback terrapin as threatened in 2013, and New Jersey banned collecting, possessing, and transporting them in 2016. 

This case was investigated by the United States Fish and Wildlife Service with assistance from the New Jersey Division of Fish and Wildlife. It is being prosecuted by Assistant United States Attorney Joan E. Burnes and trial attorney Ryan Connors of the Justice Department’s Environmental Crimes Section.

PHILADELPHIA – United States Attorney William M. McSwain announced that International SOS Assistance, Inc., International SOS Government Services, Inc., International SOS, LP, Air Rescue Americas, Inc. Arnaud Vaissié; and Pascal Rey-Herme (collectively, “International SOS”), will pay $940,000 to resolve allegations that it overcharged TRICARE, a health care insurance system for members of the military services and their families, for aeromedical evacuation services by concealing discounts it received from third-party air ambulance providers in violation of the False Claims Act.

The settlement resolves allegations that, between 2013 and 2017, International SOS, a provider of overseas healthcare services for the government, submitted to TRICARE false claims for payment relating to International SOS’s provision of aeromedical evacuations.  International SOS negotiated discounts from third-party air ambulance providers, which it was required to pass along to TRICARE. Instead, International SOS did not disclose the actual cost of the aeromedical evacuation services during the quoting process; billed TRICARE at the higher non-discounted amount; and received payment from TRICARE for the inflated costs, which International SOS contends it retained as a fee. 

“My Office is committed to protecting the integrity of federal healthcare billing regulations,” said U.S. Attorney McSwain. “We will hold accountable any federal contractor who chooses to engage in conduct that undermines those regulations, and therefore overburdens American taxpayers, by overbilling federal healthcare programs.”

“Protecting the integrity of the U.S. Department of Defense’s (DoD) procurement process and combating healthcare fraud impacting the DoD are top priorities for the Defense Criminal Investigative Service (DCIS),” stated Leigh-Alistair Barzey, Special Agent in Charge of the DCIS Northeast Field Office.  “By concealing discounts and overcharging TRICARE, the DoD’s healthcare program, International SOS sought to profit at the expense of the American taxpayer.  The settlement agreement announced today is the result of a joint effort and demonstrates DCIS’ continued commitment to work with the U.S. Attorney’s Office to ensure that U.S. military members and their beneficiaries continue to receive high quality and cost-effective healthcare.”

This settlement resolves allegations in a lawsuit by a former International SOS Regional Flight Desk Manager, under the qui tam (or whistleblower) provisions of the False Claims Act. The qui tam provisions permit private parties to sue for false claims on behalf of the government and to receive a share of any recovery. The relator here will receive $165,000 as his share of the recovery in the case. The relator was represented by Franklin J. Rooks, Jr., Esq. of Morgan Rooks, P.C., and Jared A. Jacobson, Esq. of Jared Jacobson Law, LLC.

“We thank the whistleblower for coming forward and providing essential assistance to the government. This concerned citizen’s information and assistance was critical to our office’s investigative efforts in this matter, and we deeply appreciate that contribution,” said U.S. Attorney McSwain.

This case was a cooperative effort among the U.S. Attorney’s Office for the Eastern District of Pennsylvania, and the Defense Criminal Investigative Service. For the United States Attorney’s Office, Assistant United States Attorneys Scott W. Reid, Colin Cherico, and Auditor Dawn Wiggins handled the investigation and settlement.

The lawsuit is captioned United States ex rel. Richard Nicholas v. International SOS Assistance, Inc., et al., Civil Action No. 16-3927 (E.D. Pa.). The claims resolved by the settlement are allegations only; there has been no determination of liability.

PHILADELPHIA, PA – United States Attorney William M. McSwain announced that Stephen Padnes, M.D., 77, of Glenside, Pennsylvania, a physician formerly licensed in Pennsylvania, was charged by Indictment with illegally distributing controlled substances and filing false tax returns (the “Indictment”).  McSwain also announced two civil law suits brought by the United States, one seeking forfeiture of $1,864,545 in cash seized from the defendant’s home (the “Forfeiture Complaint”) and the other seeking penalties and damages against him for alleged improper opioid prescribing under the Controlled Substances Act and False Claims Act (the “Civil Complaint”).

The Indictment charges that Padnes illegally prescribed Schedule II controlled substances, oxycodone and methadone, on seven occasions between December 21, 2015 and June 29, 2016, without any medical necessity and outside the usual course of medical practice.  It also charges that the defendant underreported the income earned by his medical practice, the Psychosomatic Medicine and Pain Rehabilitation Center, Inc., to the Internal Revenue Service by more than $700,000 for calendar years 2012, 2013, and 2014.  If convicted, Padnes faces a maximum possible sentence of 149 years’ imprisonment and fines up to $7,750,000.

The Forfeiture Complaint seeks forfeiture of $1,864,545 of cash seized from the defendant’s home during the execution of a search warrant in 2016.  The cash is alleged to be the cash proceeds from Padnes’ unlawful medical practice from at least 2010 to 2016.  The government alleges that, during that time, the vast majority of the defendant’s “patients” paid up to approximately $500 in cash for prescriptions for controlled substances, including Schedule II opioids such as oxycodone and methadone, that he wrote outside the usual course of medical practice and without a legitimate medial purpose.  The government also alleges that Padnes, at times, provided the prescriptions for payment without even seeing the supposed “patient.”  The cash was discovered in suitcases and a dresser located in a bedroom in the defendant’s home.

The Civil Complaint alleges that Padnes violated the Controlled Substances Act by issuing a large number of prescriptions for Schedule II opioids in 2014, 2015, and 2016 without a legitimate medical purpose.  The government alleges numerous instances where the defendant issued prescriptions for high doses of opioids without keeping medical records in the normal course of medical practice, physical exams, reevaluations, and/or monitoring of the effectiveness of the opioids he prescribed.  In one example, the government alleges that Padnes issued prescriptions for so many opioids to a patient that the patient would have needed to consume nearly 70 pills, the equivalent of 4,000 milligrams of morphine, every single day.  The government also alleges that the defendant violated the False Claims Act because Medicare and Medicaid paid to fill thousands of these prescriptions, causing a loss to these programs exceeding $1 million. 

The Controlled Substances Act provides for penalties for each prescription issued without a legitimate medical purpose up to $25,000 for violations on or before November 2, 2015, and up to $64,820 per violation after November 2, 2015.  The False Claims Act allows for damages three times the government’s loss and civil penalties between $5,500 and $11,000 for each false claim presented on or before November 2, 2015, and between $11,181 and $22,363 for each false claim presented after November 2, 2015. 

“Using every tool available – from criminal charges to civil complaints – is part of my Office’s continued commitment to fighting healthcare fraud and combatting the opioid epidemic ravaging our communities,” said U.S. Attorney McSwain.  “We will not allow criminals, whether they stand on a street corner or wear a lab coat, to cheat the system and exploit people in need of help in order to line their own pockets.  This defendant will now have to answer for years of alleged misconduct.”

“As charged in this indictment, Dr. Padnes knew that prescribing potentially deadly amounts of opioids without medical necessity could have devastating effects,” said Maureen R. Dixon, Special Agent in Charge for the U.S. Department of Health and Human Services.  “Working closely with our law enforcement partners we are committed to protecting the vulnerable patients who rely on government health programs.”

“Failure to report all income is a felony; one that could result in a prison sentence,” said Guy Ficco, IRS Criminal Investigation Special Agent in Charge. “Let the charges brought against Dr. Stephen Padnes serve as a reminder that we, along with our Law enforcement partners, stand ready to investigate and prosecute those who shirk their tax liability.”

The investigation was conducted by the Philadelphia Field Division of the Drug Enforcement Administration, the U.S. Department of Health and Human Services, Office of Inspector General, Internal Revenue Service Criminal Investigation, and the Federal Bureau of Investigation.  For the United States Attorney’s Office, the criminal matter is being prosecuted by Assistant United States Attorney Jerome Maiatico, the civil forfeiture matter is being prosecuted by Assistant United States Attorney Maria M. Carrillo, and the civil Controlled Substances Act and False Claims Act matter is being prosecuted by Assistant United States Attorney John T. Crutchlow.

An Indictment or Criminal Complaint is an accusation.  A defendant is presumed innocent unless and until proven guilty.  The civil complaints contain allegations only; there has been no determination of liability.

PHILADELPHIA – United States Attorney William M. McSwain announced that Kenneth Eugene Cherry, Jr., 31, of Philadelphia was convicted at trial of multiple criminal firearms offenses: dealing in firearms without a license, possession and transfer of a machine gun, possession of an unregistered firearm, possession of a firearm with an obliterated serial number, and multiple counts of possession of a firearm by a convicted felon.

From August 2018 until February 2019, Cherry and other co-conspirators trafficked firearms from Virginia to Philadelphia, where Cherry illegally sold them on the street for profit. During this period, Cherry sold a total of 26 firearms to an undercover ATF operative, including two Glock “Auto Sear” machinegun conversion devices, sixteen semiautomatic handguns, and eight semiautomatic assault rifles, one of which had been cut down for purposes of concealment. Cherry also provided a large amount of ammunition with the firearms he sold.

“The defendant and others in this illegal gun trafficking organization endangered everyone in their midst on a daily basis by putting semiautomatic weapons on the streets illegally,” said U.S. Attorney McSwain. “Thanks to our dedicated partners at ATF and our Office’s trial team, the defendant will now pay for his crimes and will no longer be allowed to menace the Philadelphia streets.”

“The conviction of Mr. Cherry is a victory not only for ATF but for the citizens of Philadelphia as this conviction exhibits a continued and collaborative effort to combat violent crime in our community,” said Donald Robinson, Special Agent in Charge for ATF Philadelphia Field Division. “Together with our partners at the Philadelphia Police Department and the United States Attorney’s Office, we have been successful at dismantling a group dedicated to firearms trafficking in Philadelphia. ATF remains committed to working with our partners to combat violent crime by continuing to target firearms traffickers who are putting illegal guns out on our streets.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was investigated by the Bureau of Alcohol, Tobacco and Firearms, and is being prosecuted by Assistant United States Attorney Mark S. Miller.

PHILADELPHIA – United States Attorney William M. McSwain announced that Keenan Smith, 29, of Philadelphia was convicted today at trial with attempted robbery which interferes with interstate commerce, and using or carrying, and discharging, a firearm during and in relation to a crime of violence.

On January 31, 2018, the defendant entered the Trolley Car Diner, located in the Mount Airy section of Philadelphia, through a side door before the diner opened for business. He waited outside the manager’s office with a gun. When the manager arrived, the defendant pointed the gun at the manager’s head and told him not to move. The manager attempted to disarm the defendant, who shot himself in the hand before fleeing. The defendant sought medical treatment at nearby Roxborough Memorial Hospital, and was later arrested by the Philadelphia Police Department.

“The complete disregard that Smith had for the safety of others is appalling,” said U.S. Attorney McSwain. “The manager of this restaurant was simply showing up to do his job, and the defendant laid in wait for him and then put a gun to his head. No one should have to deal with this type of violence at their place of business or in their neighborhood. The streets of Philadelphia are safer now that the defendant has been convicted and will be held accountable for his crimes.”

“Keenan Smith attempted a violent armed robbery, terrorizing his victim at gunpoint,” said Michael T. Harpster. “He is a danger to the public, and today’s conviction ensures he’ll remain off the street for quite some time. The FBI and our law enforcement partners are committed to making this community safer by bringing to justice those willing to engage in violent crime.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was investigated by the Federal Bureau of Investigation and the Philadelphia Police Department, with assistance from the Whitemarsh Township Police Department, and is being prosecuted by Assistant United States Attorney Tim Stengel.

PHILADELPHIA – United States Attorney William M. McSwain announced that Scott Capps, 48, of Coatesville, Pennsylvania was sentenced to 48 months’ incarceration, three years’ supervised release, restitution of $2,137,580 and forfeiture of $648,600 by United States District Judge Michael M. Baylson for a fraud scheme perpetrated while he was an employee of Vanguard.

On March 14, 2019, the defendant pleaded guilty to all counts in an indictment charging him with conspiracy to commit mail fraud, money laundering, and filing false tax returns. According to the indictment, between 2011 and 2014, Capps was an employee of Vanguard, an investment management group that managed trillions of dollars in assets for account holders throughout the world. The defendant admitted that through his employment he had access to dormant accounts that were due for escheatment, which is the process of turning over abandoned funds to the state.

The defendant stole the passwords of subordinates and used those passwords to access the system used to issue checks; he then submitted requests to have checks issued on certain dormant accounts to a co-conspirator. After depositing the checks into his own account, the co-conspirator issued to Capps checks drawn on one of his accounts. The total amount of the funds that the defendant stole exceeded $2.1 million. To Vanguard’s credit, all individual accounts were made whole after the defendant’s crimes were detected. At the guilty plea hearing, Capps also admitted that for the tax years 2013 and 2014, he had filed false tax returns that failed to report the income from his scheme.

“My office takes white collar offenses like wire fraud, tax fraud and money laundering very seriously,” said U.S. Attorney McSwain. “The defendant stole more than two million dollars by abusing his position with his former employer. My Office will continue to work with our law enforcement partners to protect innocent individuals and businesses from being victimized by this type of fraud.”

“No matter what the source of income, all income is taxable,” said Guy Ficco, IRS Criminal Investigation Special Agent in Charge. “Scott Capps failed to report the money he stole and that is a violation of the federal tax laws. Today, justice is served and he is being held accountable for his conduct. The IRS is proud to have shared its hallmark expertise in following the money trail in this and other increasingly sophisticated criminal schemes.”

“Scott Capps saw it as easy money,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “Amass millions from dormant accounts, launder those funds, and enjoy. But crime truly doesn’t pay and now he’s being held accountable. We and our law enforcement partners would like to thank Vanguard management for their assistance in this matter. Know that the FBI will never let up on those who risk engaging in financial fraud.”

The case was investigated by the Federal Bureau of Investigation, the United States Postal Inspection Service, and the Internal Revenue Service-Criminal Investigation and is being prosecuted by Assistant United States Attorney David J. Ignall.

PHILADELPHIA – United States Attorney William M. McSwain and Special Agent in Charge Michael T. Harpster of the FBI’s Philadelphia Division announced that their offices and law enforcement partners are asking for the public's assistance to identify potential victims of Robert Dean Caesar, 56, most recently of Oxford, Pennsylvania. Caesar, who is currently in federal custody, was charged by indictment on November 15, 2018 with production, receipt, and possession of child pornography. He is expected to go on trial beginning September 30, 2019.

The Indictment alleges that on or about each of two separate dates (September 16, 2017 and December 30, 2017), Caesar manufactured child pornography. The Indictment further alleges that Caesar received child pornography on December 20, 2017, and possessed child pornography on January 18, 2018.

Caesar, who most recently resided in Oxford, Pennsylvania, has also lived in Philadelphia, Norristown, Cranberry Township, and Pittsburgh, Pennsylvania; Richland, New York; and Silverthorne, Colorado.

If you have information regarding the pending prosecution, or you believe you or someone you know may have been victimized by Robert Dean Caesar, the FBI requests that you contact the Philadelphia Division at 215-418-4000 or go to www.fbi.gov/RobertCaesar. Identified victims may be eligible for certain services and rights under federal and/or state law.

If convicted as charged, the defendant faces a maximum possible sentence of 100 years’ imprisonment, a mandatory minimum term of 15 years’ imprisonment, supervised release for a minimum term of five years and a lifetime maximum term, a $1,000,000 dollar fine, mandatory restitution, and up to $20,400 in special assessments.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

The case is being investigated by the Pennsylvania State Police – Avondale Barracks, the Cranberry Township Police Department, and the Federal Bureau of Investigation, with assistance from the Chester County District Attorney’s Office and the Butler County District Attorney’s Office, and is being prosecuted by Assistant United States Attorney Seth Schlessinger.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Michael Walpole, 31, of Philadelphia, Pennsylvania, was sentenced to 210 months’ imprisonment (17 ½ years) and 15 years’ supervised release by United States District Judge Paul S. Diamond on child exploitation charges.

In May 2018, the defendant forced the five-year old victim to take off her pants and underwear. The defendant took off his own pants, placed his penis on the victim’s naked buttocks, and photographed this abuse. On April 2, 2019, the defendant pleaded guilty to manufacture and attempted manufacture of child pornography.

“The nature of this defendant’s crime is horrifying and the negative impact on the victim and her family can never be fully understood or appreciated, which is why my Office is committed to working with our law enforcement partners to identify, investigate, and prosecute these dangerous predators,” said U.S. Attorney McSwain.

“Those who sexually exploit children do serious lasting harm,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “Walpole involved a child victim in his own depraved fantasy and documented it. He’ll now be held accountable for his actions, locked away where he can’t victimize any more kids.”

This case were brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

The case was investigated by the Federal Bureau of Investigation (FBI) and is being prosecuted by Assistant United States Attorney Meaghan A. Flannery.

PHILADELPHIA – United States Attorney William M. McSwain announced that Troy Wragg, 37, of Philadelphia, PA was sentenced today to 22 years in prison and $54 million restitution by United States District Judge Joel H. Slomsky for perpetrating two fraud schemes.

The defendant was the founder of Mantria Corporation, based in Bala Cynwyd, PA.  From 2005 until 2009, Wragg received approximately $54 million in funds from investors across the United States with the false promise that they would earn 50% or higher returns on their investments.  The defendant told the victim investors that Mantria was a very successful company with investments in real estate and green energy.  In reality, however, Mantria was a Ponzi scheme which used new investor funds to pay “earnings” to earlier investors.

Wragg obtained these large investments through co-defendant Wayde McKelvy, who ran unlicensed investment clubs in Colorado.  In addition to advising the victims to invest their retirement savings in Mantria, Wragg and McKelvy coached the victims to obtain home equity loans, credit card loans, and other loans to raise even more funds to invest in Mantria.  Thus, when the Mantria Ponzi scheme collapsed, many of the victims were left financially devastated.

While on bail pending sentencing for the Mantria fraud, Wragg brazenly committed a second fraud scheme.  The defendant solicited an investment in an online video dating service, known as LUVR, with the false representation that the company was about to be purchased by a well-known internet entrepreneur.  In reality, no such deal ever existed and the victim lost her entire investment.

“Wragg and his co-conspirators talked a big game about their bogus trash-to-green-energy business, but it was all a lie.  And when he was caught in this lie, he just couldn’t help himself and decided to scam yet another innocent investor,” said U.S. Attorney McSwain.  “The defendant is clearly a danger to the public and deserves to be in prison for a very long time.  My office thanks the Court for delivering an appropriate sentence.”

Wragg pleaded guilty to both fraud schemes.  Co-defendant Amanda Knorr also pleaded guilty to her role in the Mantria fraud and was sentenced in April 2019 to 30 months’ in prison.  Co-defendant Wayde McKelvy was convicted on all counts at trial in October 2018.  The Court has not yet set a sentencing date for McKelvy.

The case was investigated by the Federal Bureau of Investigation with assistance from the U.S. Securities and Exchange Commission, the Colorado Division of Securities, the Arizona Division of Securities, the Tennessee Department of Financial Institutions, and the Upper Darby Township Police Department.  The case was prosecuted by Assistant United States Attorneys Robert J. Livermore and Sarah M. Wolfe.

What I witnessed last night was true heroism by the Philadelphia police.  But the crisis was precipitated by a stunning disrespect for law enforcement – a disrespect so flagrant and so reckless that the suspect immediately opened fire on every single officer within shooting distance.  Only by the grace of God did they survive.

Where does such disrespect come from?  

There is a new culture of disrespect for law enforcement in this City that is promoted and championed by District Attorney Larry Krasner – and I am fed up with it.

It started with chants at the DA’s victory party – chants of “F*** the police” and “No good cops in a racist system.”

We’ve now endured over a year and a half of the worst kinds of slander against law enforcement – the DA routinely calls police and prosecutors corrupt and racist, even “war criminals” that he compares to Nazis.

This vile rhetoric puts our police in danger.  It disgraces the Office of the District Attorney.  And it harms the good people in the City of Philadelphia and rewards the wicked.

The alleged shooter last night, Maurice Hill, is a previously convicted felon with a long rap sheet.  We have plenty of criminal laws in this City – but what we don’t have is robust enforcement by the District Attorney.  Instead, among other things, we have diversionary programs for gun offenses, the routine downgrading of charges for violent crime, and entire sections of the criminal code that are ignored. 

The criminal laws in this City – and especially the existing gun laws and drug laws – should be aggressively enforced in order to protect the public and the police.  My Office is doing all that we can.  We have prosecuted 70% more violent crime cases this year than we did last year, in response to the District Attorney’s lawlessness.  But it is now time for the District Attorney and his enablers to stop making excuses for criminals.  It is time for accountability.  It is time to support law enforcement and to put the good people of this City first.

The U.S. Attorney’s Office, in conjunction with the Philadelphia police and our federal partners, is investigating the horrible events of last night and we are considering all options at our disposal.  We will do everything that we can to support our brothers and sisters in the Philadelphia Police Department and ensure justice is done.

To the officers involved last night – those who were wounded and those who rushed to defend them – and to their families, I say thank you.  The whole City thanks you.  We owe you more than we can ever repay.

PHILADELPHIA – United States Attorney William M. McSwain announced that Behzad Sabagh, 37, of Philadelphia, Pennsylvania, was sentenced today to 1 month imprisonment, 9 months house arrest as part of 3 years supervised release, $30,000 fine and $100 special assessment plus costs of prosecution by United States District Judge Wendy Beetlestone.  Sabagh pleaded guilty to one count of conspiracy to commit honest services wire fraud in April 2019.

Sabagh was a real estate investor who regularly purchased properties at City of Philadelphia Sheriff’s sales, which are the sales of real property subject to mortgage foreclosure, tax liens, and tax delinquency. From September 2012 to August 2013, Sabagh paid bribes to an employee in the Philadelphia Sheriff’s Office Real Estate Department to assist him with his business of purchasing properties. 

The preferential treatment the employee provided Sabagh included sending him the list of properties that were actually going to sale as opposed to the publicly available list that contained properties that had been removed from the sale pool, working to get deeds for Sabagh’s properties faster than other buyers, and removing municipal liens and paying outstanding bills more quickly on Sabagh’s properties than on those of other buyers who were not providing bribes.  The employee also granted extensions of the time to pay the balance that Sabagh owed to complete his purchase of properties, beyond the limits applicable to other buyers. Sabagh paid the employee hundreds of dollars in cash five or six times for this preferential treatment.

“The laws of the land apply to everyone – and certainly to public servants who are paid with public dollars and who are supposed to serve everyone equally,” said U.S. Attorney McSwain.  “Every person doing business with the government should be on notice that federal law enforcement is watching and we will hold you accountable if you try to gain special favor by paying bribes to public employees.”

The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation, and the City of Philadelphia Office of Inspector General, and is being prosecuted by Assistant United States Attorneys Sarah L. Grieb and Christopher Diviny.

PHILADELPHIA – United States Attorney William M. McSwain announced that Christopher Kauffman, 37, of Summerville, South Carolina was charged in a criminal Information with filing a false tax return.

According to the Information, Kauffman operated an accounting and tax preparation service in South Philadelphia in 2011 and 2012.  In 2012, Kauffman deposited fees from his clients into his personal bank account.  Some of the receipts included money Kauffman was supposed to use to pay the tax obligations of some of his clients.  Instead, Kauffman used the money to pay for his personal expenses.  He subsequently failed to report $160,347 in business receipts on his personal income tax return for the year 2012.

“Our tax system requires tax payers to truthfully report their income.  Professional accountants and tax preparers know that better than anyone, and yet the defendant here breached that duty,” said U.S. Attorney McSwain. “He compounded his crime by using his clients’ money as his own.  My Office will continue to aggressively pursue business people who operate in such an illegal manner.”

If convicted, the defendant faces a maximum possible sentence of three years imprisonment and a $250,000 fine.

The case was investigated by the Internal Revenue Service and the Treasury Inspector General’s Office for Tax Administration, and is being prosecuted by Assistant United States Attorney Richard P. Barrett.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Ambu, Inc. (“Ambu”), will pay $3.3 million to resolve False Claims Act allegations that it manufactured products in China and Malaysia for sale to United States government agencies in violation of the Trade Agreements Act (“TAA”).   

The settlement resolves allegations that, between December 2011 and March 2015, Ambu, a provider of medical supplies, submitted false claims to the Defense Logistics Agency (“DLA”) and the Department of Veterans’ Affairs (“VA”) for payment relating to Ambu’s sales of medical supplies. The Trade Agreements Act (“TAA”) requires that products sold to government agencies must come only from countries with which the United States has a trade agreement.  While many countries qualify as TAA compliant countries, China and Malaysia do not.  Ambu began manufacturing its products in these countries and selling them to government agencies in violation of the TAA.  Indeed, over 80% of Ambu’s sales to DLA and VA under these contracts were from these non-compliant countries during the years covered by the settlement.  Ambu executives certified that its products came from compliant countries despite allegedly knowing that most of the products were manufactured in non-compliant countries.       

“Congress passed the Trade Agreements Act as an important part of the United States’ economic, diplomatic, and defense strategy,” said U.S. Attorney McSwain.  “Contractors must follow the law and manufacture their products in TAA compliant countries, whether they like it or not.  By investigating the allegations and reaching a settlement in this case, we have put all companies doing business with the United States government on notice that the TAA is an important law that must be respected.”    

“The Defense Criminal Investigative Service (DCIS) is committed to protecting the integrity of the U.S. Defense Department’s (DoD) procurement process and ensuring that defense contractors comply with all applicable laws, such as the Trade Agreements Act (TAA),” stated Leigh-Alistair Barzey, Special Agent in Charge of the DCIS Northeast Field Office.  “The settlement agreement announced today is the direct result of a joint effort by the DCIS, Army CID, VA-OIG and the U.S. Attorney’s Office, to guarantee that medical supplies purchased by the DoD for members of the U.S. military and their dependents are manufactured in TAA compliant countries.”

This case was a cooperative effort among the U.S. Attorney’s Office for the Eastern District of Pennsylvania, the Defense Criminal Investigative Services, the United States Army Criminal Investigation Division and the Department of Veterans Affairs Office of Inspector General.  For the United States Attorney’s Office, Assistant United States Attorney Colin Cherico and Auditor Dawn Wiggins handled the investigation and settlement.

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

PHILADELPHIA – United States Attorney William M. McSwain announced that the United States filed a civil lawsuit against Elizabeth N. Kuh, a psychiatrist practicing in Montgomery County, alleging that she wrote improper opioid and benzodiazepine prescriptions for two of her patients. According to the complaint, Kuh wrote 30 opioid and benzodiazepine prescriptions to a husband and wife couple which lacked a legitimate medical purpose, were issued outside the usual course of professional practice, and many of which resulted in false claims to Medicare.

The complaint filed by the United States alleges that Kuh had no specialization or training in pain management, but she repeatedly prescribed the couple 80mg OxyContin and benzodiazepine controlled substances. The prescriptions were allegedly issued to the couple frequently by mail without an in-person physical examination, without urine drug screens or diagnostic testing, frequently not recorded in Kuh’s records, and frequently while the wife’s pain management and other conditions were managed by other providers. Kuh’s improper prescribing continued for years, even after she learned that the wife’s opioids could be harming her mental health and contributing to hallucinations.

The complaint alleges that this prescribing by Kuh only ended shortly after the husband committed suicide. Kuh had allegedly sent multiple prescriptions of OxyContin through the mail to the husband—once again, without physical examination, urine drug screen, diagnostic testing, or attempting less dangerous alternatives. Kuh allegedly responded by mailing additional OxyContin prescriptions to the wife at her request. The United States’ suit seeks damages for the alleged false claims to Medicare, civil penalties for the improper prescriptions, and injunctive relief to restrict Kuh’s controlled substance registration.

The United States and Kuh have entered into a Stipulated Order and Consent Judgment, subject to the Court’s approval, which would resolve the matter without litigation. If approved by the Court, the Judgment would require Kuh to pay $250,000 to the United States, prohibit Kuh from ever writing another opioid prescription, and would treat any future violation as contempt of court.

“While all healthcare providers have a duty to ensure the well-being of their patients, psychiatrists have the responsibility of treating and caring for particularly vulnerable patients,” said U.S. Attorney McSwain. “Psychiatrists who write opioid or benzodiazepine prescriptions to their patients must ensure that the prescriptions are appropriate and comply with federal and state law. My Office’s Affirmative Civil Enforcement Strike Force will continue to aggressively pursue improper opioid and controlled substance prescribing, hold providers accountable, and protect the citizens of the Eastern District of Pennsylvania.”

“All registrants, to include Dr. Kuh, have an obligation to prescribe controlled substances such as opioids and benzodiazepines solely for a legitimate medical purpose and within the course of professional medical practice,” said Jonathan A. Wilson, Special Agent in Charge of the Drug Enforcement Administration’s Philadelphia Field Division. “The allegations against Kuh, who repeatedly prescribed these powerful drugs without any training in pain management and without conducting routine physical examinations, are deeply concerning.”

“Civil enforcement is an important tool to recover funds when physicians cause improper claims to the Medicare program,” said Maureen R. Dixon, Special Agent in Charge for the U.S. Department of Health and Human Services, Office of the Inspector General. “HHS-OIG will continue to work with the Affirmative Civil Enforcement Strike Force and our other law enforcement partners to ensure the integrity of the Medicare program.”

This investigation was conducted with the Philadelphia Field Division of the Drug Enforcement Administration, the Pennsylvania Department of State’s Bureau of Enforcement and Investigation, and the Department of Health and Human Services Office of Inspector General. For the United States Attorney’s Office, Assistant United States Attorney Anthony D. Scicchitano and Auditors Dawn Wiggins and Denis Cooke handled the matter.

The complaint contains allegations only; there has been no determination of liability.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Alan Womack, 44, of Philadelphia, Pennsylvania was convicted today at trial with conspiracy to distribute over 1,000 kilograms of marijuana and conspiracy to commit money laundering.

Between 2005 and 2016, the defendant was an integral part of a drug trafficking organization that arranged for thousands of pounds of marijuana to be shipped on tractor-trailers across the country, from Phoenix to Philadelphia, on a monthly basis. The organization also arranged for truck drivers and people known as “mules” to transport hundreds of thousands of dollars from Philadelphia to Phoenix so they could pay for bulk orders of marijuana supplied by a cartel in Mexico.

The defendant and nine co-defendants were charged in a second superseding indictment in 2017 for their roles in the conspiracy which included illegal acts such as organizing the marijuana shipments, renting storage lockers where bales of marijuana would be held before transport, smuggling large amounts of cash on tractor-trailers and on airplanes, operating stash houses in Philadelphia, and possessing illegal firearms to protect their illicit business. In total, the organization was responsible for smuggling more than 8,000 pounds of marijuana across the country, while making millions of dollars over the course of a decade.

At trial, the government presented evidence in the form of testimony from cooperating witnesses, civilian witnesses and law enforcement agents. The physical evidence included recorded phone calls, video surveillance, phone records, various business records and hundreds of pounds of marijuana seized during the course of the investigation.

“Womack and other members of this drug organization pumped huge quantities of marijuana into our community for years,” said U.S. Attorney McSwain. “Drug trafficking is an inherently dangerous business and the traffickers ultimately deliver destruction to our communities. Our office is determined to investigate and convict these criminals, and put them behind bars.”

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Justin Ashenfelter.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Milton Mateo Garcia-Vasquez, 32, of Philadelphia, Pennsylvania and a citizen of Honduras, entered a plea of guilty before United States District Judge Paul S. Diamond on the charge of unlawfully re-entering the United States after being deported.

The defendant was previously deported and removed from the United States on June 18, 2013, and never requested or received authorization to re-enter the country.  Nonetheless, he broke the law by re-entering the country and then proceeded to commit burglary, kidnapping and rape in Philadelphia.  The defendant was arrested on June 23, 2014 by Philadelphia Police officers and charged with these and other crimes in connection with a rape near Rittenhouse Square.  The defendant pleaded guilty to those charges in 2015 and was sentenced to a total of 22-44 years in prison.

“This case is a law-abiding citizen’s nightmare: an illegal alien who has been previously deported comes back into the country illegally and commits appalling crimes.  And it is a reminder of why we are a nation of laws and why those laws – including immigration laws – should be respected and enforced.  My Office will continue to enforce federal law in a neutral, non-partisan manner, which is the only way to ensure public safety.  And I call on Philadelphia city officials and the District Attorney to stop treating the criminal justice system like a game in which they play political favorites.  There is simply too much at stake for that sort of nonsense.  The public deserves better.” 

“ICE deportation officers not only identify and arrest dangerous criminals in our communities, they also remove them, thereby protecting public safety,” said Simona Flores-Lund, Field Office Director for U.S. Immigration and Customs Enforcement (ICE) Enforcement and Removal Operations (ERO) Philadelphia. “ICE continues to face significant obstacles with policies created by local officials which hinder cooperation between ICE and local law enforcement. Yet, the tireless efforts of the men and women of ICE directly contribute to making our communities safer.”

The case was investigated by Immigration and Customs Enforcement (“ICE”), and is being prosecuted by Assistant United States Attorney Mary E. Crawley.

PHILADELPHIA – United States Attorney William M. McSwain announced that Justin Hiemstra, 22, from St. Paul Park, Minnesota, entered a plea of guilty before United States District Judge Cynthia M. Rufe on charges related to violations of 18 U.S.C. § 1030 for using a school computer and someone else’s username without that person’s permission in an attempt to illegally obtain President Donald Trump’s tax returns from the Internal Revenue Service. 

These charges arose out of a plot between the defendant, then a student at Haverford College, and another Haverford College student, to use computers at the school’s computer lab and the Free Application for Student Aid (FAFSA) website to illegally access the tax returns.  The defendant opened a false FAFSA application in the name of a member of the Trump family, and found that someone else had already obtained a username and password for Donald Trump.  In order to reset the password, the defendant was prompted to answer challenge questions, which the original person had created when setting up the account.  The defendant was able to answer the questions and reset the password, and then used the President’s personal identifier information, including his social security number and date of birth, to attempt to import the President’s federal tax information into the bogus FAFSA application.  Ultimately, this illegal attempt failed.

“No matter what you think about the President’s tax returns, clearly this kind of illegal activity cannot be tolerated or condoned.  Unauthorized or false attempts to obtain any citizen’s IRS filings are a serious violation of privacy rights and a federal crime, and there’s nothing funny about it,” said U.S. Attorney McSwain.  “Now this defendant is being held accountable for his actions, as he should be.”

The case was investigated by the Department of Education – Office of Inspector General and the Treasury Inspector General for Tax Administration, and is being prosecuted by Assistant United States Attorney Anthony J. Wzorek.

PHILADELPHIA – United States Attorney William M. McSwain announced that David Milliner, 50, of Philadelphia, PA entered a plea of guilty today before United States District Court Judge Petrese Tucker to four counts of online enticement of a minor, six counts of manufacturing/attempted manufacturing of child pornography, four counts of receipt of child pornography, one count of transfer of obscene material to a minor, and one count of possession of child pornography.

The charges arise out of the defendant’s sexually explicit online communications with four boys, ages 8 through 12, between September and December of 2017, during which the defendant pretended to be a prince from the royal “DeRothschild” family and enticed his victims to self-produce images of child pornography and send them to him over Instagram. At the time of the defendant’s arrest, he was in possession of images of child pornography of these victims and other children.

“Child exploitation is a pervasive problem – made more so by the accessibility of the Internet and digital media – that demands an aggressive response,” said U.S. Attorney McSwain. “Child predators typically lie and manipulate children in order to get what they want, and this case is a prime example of that. We urge parents and guardians to monitor what their children do online, and we stand ready with our federal and local partners to identify and prosecute those who would prey upon minor children.”

The case was investigated by the Federal Bureau of Investigation, the Philadelphia Police Department Special Victims Unit, and the Wayland, Michigan Police Department, and is being prosecuted by Assistant United States Attorney Kelly Harrell.

PHILADELPHIA – United States Attorney William M. McSwain announced that Spiro Y. Kassis, M.D., 66, of Plymouth Township, PA, was charged by Information with 14 criminal counts of distributing dangerous and addictive opioids and other controlled substances outside the course of professional practice and without a legitimate medical purpose.

According to the Information, the defendant, who claimed to be a specialist in psychiatry and addiction medicine, operated medical offices in East Norriton Township, PA and Scranton, PA.  Kassis used his offices to operate a prescription “pill mill” whereby he sold medically unnecessary prescriptions for opioids drugs such as oxycodone and burprenorphine, and other controlled substances.  The defendant sold prescriptions to so-called patients for approximately $200 cash each.  At the East Norriton office, Kassis saw approximately 45 “patients” per day, who lined up outside of a back room to the office.  As each person filed in, Kassis collected $200 cash from the patient, counted the money, and then issued the requested prescriptions electronically to the patient’s pharmacy.  Often, the defendant issued dangerous combinations of prescriptions including oxycodone, methadone, and buprenorphine, all to the same patient. 

“My Office is committed to working with our law enforcement partners at all levels to find those responsible for flooding our neighborhoods with these dangerous drugs and bringing them to justice,” said U.S. Attorney McSwain. “I want to thank Montgomery County District Attorney Kevin Steele and his Office for referring this case for federal prosecution and for their cooperation as we bring drug dealers – whether they wear a lab coat or stand on a street corner – to justice.”

“The defendant, Spiro Kassis, may have had the title of doctor but he was simply a drug dealer, peddling addiction by using a prescription pad,” said Montgomery County District Attorney Kevin R. Steele. “Kassis was selling thousands of prescriptions purely to make money. Instead of being a healer and doing no harm, he was a major contributor to the opioid-heroin-fentanyl epidemic that is killing so many people in our communities.”

If convicted, the defendant faces a maximum possible sentence of 250 years in prison.

The case was investigated by the Drug Enforcement Agency; Federal Bureau of Investigation; Health and Human Services – Office of Inspector General; and Montgomery County Detective Bureau’s Narcotics Enforcement Team, and is being prosecuted by Assistant United States Attorney M. Beth Leahy, and Special Assistant United States Attorney James Price who was cross-designated by the Montgomery County District Attorney for this prosecution.  The related civil actions are being handled by Assistant United States Attorney Anthony Scicchitano.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Blair Strouse, 29, of Warminster, PA, was sentenced today to 30 months’ imprisonment by United States District Judge Petrese Tucker for charges related to cyberstalking his estranged wife.

In February 2015, the defendant began communicating online with a Brazilian citizen living in Brazil, who eventually travelled to the United States to work for a company that provided au pair services to families in the United States.  When the position did not work out, the woman moved to Pennsylvania in August 2016 to be with the defendant, whom she married about one month later.  Shortly thereafter, in November 2016, the defendant began mistreating the woman, and she moved out of their Warminster residence.  In December 2016, the defendant began a relentless campaign to threaten and harass her and her family members who were still living in Brazil.

Over the course of several months, the defendant sent dozens of electronic communications from his home to his wife’s family members and associates – repeatedly threatening to kill and inflict serious injury upon his victims.  He also offered to pay anyone willing to kill or injure his wife’s family members.  Even after a judge in the Bucks County Court of Common Pleas issued a protection from abuse order against the defendant in February 2017, he continued to send harassing messages and stated that his purpose in life was to make members of his estranged wife’s family suffer.

“Threats like these made in any manner, whether via electronic communications or otherwise, are taken very seriously by my Office,” said U.S. Attorney McSwain.  “It’s not an excuse to say that you were just mouthing off; if you threaten serious bodily injury or even death over the internet, that is a federal crime with consequences.”

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Deputy United States Attorney Louis D. Lappen.

The former Sheriff of Philadelphia John Green, 72, of Philadelphia, Pennsylvania, was sentenced today to serve five years in prison followed by one year of supervised release, and ordered to forfeit $76,581 by U.S. District Judge Wendy Beetlestone of the Eastern District of Pennsylvania.

John Green was convicted of conspiring to defraud the citizens of Philadelphia of his honest services as Sheriff of Philadelphia by receiving and accepting a stream of hidden personal benefits from co-defendant James Davis in exchange for giving Davis millions of dollars of business at the Philadelphia Sheriff’s Office.  From 2002 to 2011, Green accepted hidden bribes and kickbacks from his co-defendant Davis totaling over $675,000.  The bribes and kickbacks that Davis gave to Green included: (1) a move-in ready home in Philadelphia for Green and his new wife in 2003, with rent-free living and then Green’s purchase of the home at a discount; (2) employment of Green’s new wife as a subcontractor when she started a new business in 2004, paying her over $89,000, and being the primary and at times sole employer of Green’s wife; (3) facilitation of over $65,000 in hidden campaign contributions to Green’s 2007 re-election campaign through others; (4) payment of over $148,000 in advertising for Green’s 2007 re-election campaign and falsely reporting the payments on the campaign finance reports; and (5) over $320,000 in payments to Green to assist him with the purchase of his retirement home in Florida in 2010.  In exchange, Green gave his co-defendant Davis over $35 million of business at the Philadelphia Sheriff’s Office in the sale of homes at sheriff’s sales.  

“Sheriff Green sold the business of his office for hundreds of thousands of dollars in bribes and kickbacks,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.  “Today’s sentence holds him accountable for his near-decade-long betrayal of the public trust.”

“Public officials hold office to serve the public good, not to line their own pockets” said U.S. Attorney William M. McSwain for the Eastern District of Pennsylvania.  “When public servants abuse their authority and flout the rule of law, they disgrace themselves and the offices they hold.  That is what Green did here and he is now paying the price.  Every public official should be on notice after today’s sentence: federal law enforcement is watching and we will hold you accountable to the law and to the public that you are supposed to serve.”

“This type of corruption erodes the faith of citizens in the city's ability to function and causes people to question the honesty, integrity and efficiency of how the city is run,” said City of Philadelphia Inspector General Amy L. Kurland.  “This case was especially significant to the city and this sentence sends a strong message that we will not tolerate employees or officials using their positions to enhance their own wealth at the taxpayers’ expense.”

Green left office at the end of 2010, over one year before the expiration of his term, after the City of Philadelphia, Office of the Controller had issued an audit report in October 2010 expressing concern about potential irregularities with respect to the funds held by the Philadelphia Sheriff’s Office relating to Sheriff’s sales.  The Controller’s Office hired Deloitte Financial Advisory Services, which conducted a forensic investigation of the Sheriff’s Office.  Deloitte issued a report in October 2011 that revealed the extent of the hidden business that Green had given to co-defendant Davis.  Deloitte provided its findings to the government.  Green pleaded guilty in April 2019. 

The case was investigated by the FBI, IRS Criminal Investigation, and the City of Philadelphia Office of Inspector General.  Trial Attorney Jennifer A. Clarke of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys Sarah L. Grieb and Christopher Diviny of the Eastern District of Pennsylvania prosecuted the case.

PHILADELPHIA – United States Attorney William M. McSwain announced that former Philadelphia Sheriff John Green, 72, of Philadelphia, Pennsylvania, was sentenced today to sixty months’ imprisonment, one year supervised release, forfeiture of $76,581, and a $17,500 fine by United States District Court Judge Wendy Beetlestone.

Green pled guilty in April 2019 to conspiring to defraud the citizens of Philadelphia while serving as Sheriff by receiving and accepting a stream of hidden personal benefits from co-defendant James Davis, in exchange for giving Davis millions of dollars of business from the Philadelphia Sheriff’s Office. 

From 2002 to 2011, Green accepted bribes and kickbacks from Davis totaling over $675,000.  The bribes and kickbacks included: (1) a move-in ready home in Philadelphia for Green and his new wife in 2003; (2) employment of Green’s wife as a subcontractor when she started a business in 2004, paying her over $89,000; (3) facilitation of over $65,000 in hidden campaign contributions to Green’s 2007 re-election campaign; (4) payment of over $148,000 in advertising for Green’s 2007 re-election campaign and falsely reporting the payments on the campaign finance reports; and (5) over $320,000 in payments to Green to assist him with the purchase of his retirement home in Florida in 2010. 

In exchange, Green gave his Davis over $35 million in business at the Philadelphia Sheriff’s Office through the sale of homes at Sheriff’s sales. Green left office at the end of 2010, over one year before the expiration of his term, after the City of Philadelphia, Office of the Controller, issued an audit report in October 2010 expressing concern about potential irregularities with respect to the funds from Sheriff’s sales held by the Philadelphia Sheriff’s Office.  The Controller’s Office hired Deloitte Financial Advisory Services, which conducted a forensic investigation of the Sheriff’s Office.  Deloitte issued a final report in October 2011 that revealed the extent of the hidden business that Green had given to Davis and provided its findings to the government.    

“Public officials hold office to serve the public good, not to line their own pockets” said U.S. Attorney McSwain.  “When public servants abuse their authority and flout the rule of law, they disgrace themselves and the offices they hold.  That is what Green did here and he is now paying the price.  Every public official should be on notice after today’s sentence: federal law enforcement is watching and we will hold you accountable to the law and to the public that you are supposed to serve.”

The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigation, and the City of Philadelphia Office of Inspector General, and is being prosecuted by Assistant United States Attorneys Sarah L. Grieb and Christopher Diviny, and U.S. Department of Justice Trial Attorney Jennifer A. Clarke.

PHILADELPHIA – United States Attorney William M. McSwain announced today that Fernando Antonio Garcia-Bonilla, 27, of Quinlan, Texas, was sentenced to eighteen months in federal prison by United States District Court Judge Mitchell S. Goldberg.  The defendant was convicted of re-entering the United States illegally after being deported on two prior occasions and after having committed three DUIs while in the country unlawfully.  After he serves his sentence, the defendant will be deported to Mexico.

On August 16, 2018, the defendant, an illegal alien, native and citizen of Mexico, was charged in an indictment with one count of re-entry into the United States after previously being deported and removed from the country on or about March 2, 2017 and February 15, 2018.  On March 18, 2019, the defendant pleaded guilty to the indictment.

While illegally present in the United States, the defendant was convicted of driving while intoxicated by three different Texas courts, the last of which sentenced him to serve ten years in prison, all but two of which were suspended.  Additionally, this federal conviction is the defendant’s third conviction for violating this nation’s immigration laws, as he was previously federally convicted of illegal entry into the United States on February 17, 2017, in the District of New Mexico, and then convicted of illegal re-entry into the United States on August 11, 2017 in the same district.  He was sentenced to serve ten months’ imprisonment following his most recent federal conviction.

“The defendant in this case has no respect for the laws of this country, be they state or federal,” said U.S. Attorney McSwain.  “After being removed on two prior occasions, Garcia-Bonilla decided yet again to scorn our immigration system by entering the United States illegally, even after serving state and federal time for his crimes.  He is clearly a danger to the public and does not deserve the privilege of being in our country.”

“Mr. Garcia-Bonilla’s sentencing sends a clear message that criminal aliens who illegally re-enter the United States will face criminal prosecution for flagrantly disregarding our laws,” said Simona L. Flores-Lund, Field Office Director for U.S. Immigration and Customs Enforcement (ICE) - Enforcement and Removal Operations (ERO) Philadelphia.  “It should also serve as a warning to others contemplating re-entering this country illegally that ERO officers will seek to affect their removal and preserve the integrity of our immigration laws.”

The case was investigated by ICE-ERO and the Department of Homeland Security - Homeland Security Investigations, and is being prosecuted by Assistant United States Attorney Nelson S.T. Thayer, Jr.

PHILADELPHIA – United States Attorney William M. McSwain announced that John Leroy Gordon, 27, of Chester, Pennsylvania, entered a plea of guilty to carjacking before the Honorable Gerald J. Pappert yesterday, just before trial was set to commence. 

The charge arose from the defendant’s June 26, 2018 armed carjacking of a Chester woman in front of her home.  During the incident, the defendant robbed the victim of her car, which he then drove directly to Interstate 95, where he crashed it several minutes later.  The defendant then fled on foot.  The defendant’s flight was thwarted when he was swiftly apprehended approximately 15 minutes after crashing the stolen car, less than a half mile from the crash site, by officers from the Chester Police Department and the Pennsylvania State Police – Media Barracks.

“The defendant’s actions here both terrorized the victim and jeopardized the safety of other innocent drivers. A conviction in a high-profile, violent crime case such as this one serves justice and also brings relief to the entire community,” said U.S. Attorney McSwain.  “I want to thank our investigating partners at the federal and local level who did such tremendous work bringing this defendant into custody.”

“Carjackings are terrifying for their victims, particularly when, as in this case, the perpetrator is armed,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “Each and every day, the FBI and our law enforcement partners are working together to get violent criminals off the street and make our community safer all around.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.   The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was investigated by the Federal Bureau of Investigation, Chester Police Department, and Pennsylvania State Police, and is being prosecuted by Assistant United States Attorney Sarah Damiani.

PHILADELPHIA – United States Attorney William McSwain announced today that Eagleville Hospital, which provides substance use disorder treatment in Eagleville, Pennsylvania, has agreed to pay $2.85 million to the federal government to resolve allegations that the hospital violated the False Claims Act by submitting claims to Medicare, Medicaid, and the Federal Employees Health Benefits Program (“FEHBP”) for hospital-level detoxification treatment services when the patients were ineligible for admission to receive such services or lacked documentation to support the claims.

The settlement resolves allegations in a complaint filed in federal court in the Eastern District of Pennsylvania by a whistleblower under the qui tam provisions of the False Claims Act. These provisions allow private citizens to bring civil actions on behalf of the United States and share in any recovery. The whistleblower here will receive over $500,000 of the recovery. He was represented by David Caputo of Youman & Caputo and Joseph Trautwein of Joseph Trautwein & Associates.

Contemporaneous with the civil settlement, Eagleville Hospital also entered into a five-year Corporate Integrity Agreement (“CIA”) with the Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), which requires, among other things, the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks on an ongoing basis. The CIA requires training, auditing, and monitoring designed to address the conduct at issue in the case.

In his qui tam complaint, the whistleblower alleged that Eagleville Hospital admitted certain groups of its substance use disorder treatment patients for the higher-reimbursing hospital-level detoxification treatment, rather than the residential-level treatment, without satisfying the medical necessity requirements to do so. The whistleblower alleged that this practice resulted in false claims to Medicare, Medicaid, and FEHBP. This settlement agreement resolves the allegations for claims from January 2011 through December 2018.

“As our country and communities struggle with the burdens of opioid use disorder, it is critical that we protect federal healthcare programs serving individuals with those disorders and ensure that detoxification treatment providers like Eagleville Hospital are appropriately billing for the necessary services provided to their patients,” said First Assistant U.S. Attorney Jennifer Arbittier Williams. “We appreciate Eagleville Hospital’s willingness to negotiate a prompt resolution in this matter, including entering a Corporate Integrity Agreement to address compliance going forward. We also thank the whistleblower for bringing this matter to our attention. Together with his lawyers, this whistleblower allowed us to pursue this investigation and preserve the integrity of federal healthcare and opioid use disorder treatment programs.”

“We thank the whistleblower for bringing this conduct to our attention and also thank Eagleville Hospital for their assistance in resolving the matter,” said Maureen R. Dixon, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “We encourage individuals and companies to work together with HHS-OIG and the U.S. Attorney’s to ensure federally funded healthcare resources are used appropriately.”

There has been no determination of civil liability. The settled civil claims are allegations only.

This case was handled by Assistant United States Attorney Anthony D. Scicchitano with investigative assistance from auditor Dawn Wiggins, HHS-OIG, and the Office of Personnel Management Office of Inspector General.

PHILADELPHIA, PA – United States Attorney William McSwain announced that the owners of E-Z Pharmacy II in Philadelphia have agreed to pay $400,000 to resolve liability under the False Claims Act.

Darshan Bapa Inc., doing business as E-Z Pharmacy II, and Natverbhai Patel will together pay $400,000 to the federal government to resolve allegations that they violated the False Claims Act by billing Medicare for prescription medications that were not actually dispensed during the period November 9, 2013 to December 31, 2016.  These medications include Apidra, SoloSTAR, Renvela, Lantus, Revatio, Xifaxan, and Enbrel. 

“Medicare fraud is a priority for our Office,” said First Assistant U.S. Attorney Jennifer Arbittier Williams.  “Taxpayer dollars should not be wasted on fraud and abuse, and our Office will continue to scrutinize and pursue pharmacies that engage in such conduct.  We appreciate E-Z Pharmacy II's willingness to promptly negotiate a resolution in this matter.” 

“I also want to thank the Office of Audit Services,” Williams said, referring to the Philadelphia component within the Department of Health and Human Services, Office of the Inspector General.  “Its referral of this matter to law enforcement made this result possible.”

“Pharmacies are responsible for all claims they submit to Medicare,” said Maureen R. Dixon, Special Agent in Charge of the Philadelphia Regional Office of the Department of Health and Human Services, Office of the Inspector General.  “HHS-OIG and the U.S. Attorney’s Office take allegations of health care fraud seriously and will work together to ensure taxpayers dollars are only spent on bona fide medical claims.”

The settled civil claims are allegations only.  There has been no determination of civil liability.

This case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General.  It was handled by Assistant U.S. Attorney Deborah W. Frey, Civil Chief Gregory B. David, and Auditor George Niedzwicki.    

PHILADELPHIA – United States Attorney William M. McSwain announced that Donald Scott Crothers, 45, of Milford, Delaware was sentenced to 18 months’ incarceration and three years’ supervised release by United States District Judge R. Barclay Surrick for his role in a federal program bribery scheme involving millions of dollars in contracts with the National Railroad Passenger Corporation (“Amtrak”). Crothers’ co-defendant, John Gonzales, will be sentenced at a later date.

Crothers and Gonzales were both executives for a small, Delaware-based manufacturing firm; Crothers served as the firm’s Vice President for Marketing and Contract Administration. The pair bribed Timothy Miller, a Lead Contract Administrator working in procurement for Amtrak, with cash payments totaling approximately $20,000 and trips to Rehoboth Beach, Delaware. In turn, Miller awarded more than $7.6 million in Amtrak contracts to the defendants’ firm – contracts which were federally funded through US Department of Transportation/Federal Railroad Administration grants. Miller pleaded guilty on April 11, 2018.

“This defendant flouted the law to gain millions of public dollars for his firm under false pretenses,” said First Assistant United States Attorney Jennifer Arbittier Williams. “The contracting process for federally-funded transportation projects must be unbiased and competitive in order to ensure fairness for all competing businesses and taxpayers. This Office is committed to maintaining the integrity of the federal contracting system and will prosecute those who violate this important area of federal law.”

“Pursuing corrupt companies and individuals who abuse government procurement practices for personal gain demonstrates the Department of Transportation Office of Inspector General’s (DOT OIG) commitment to maintain the integrity of funds used for federal transportation goods and services,” said DOT OIG Regional Special Agent-In-Charge Douglas Shoemaker. “DOT OIG along with our law enforcement and prosecutorial partners will continue to strongly pursue such cases involving wrongdoing for corporate crimes and greed.”

“Donald Crothers tried to gin up more business for his firm — not by working harder or smarter, but through blatant bribery,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “He corrupted the government’s contracting process, yielding millions in ill-gotten gains, and is finally being held to account for his actions.”

“Today’s sentencing highlights our commitment to ensuring Amtrak’s contracting process remains free from criminal activity,” said Kevin Winters, Amtrak’s Inspector General. “We appreciate the seamless collaboration with the U.S. Attorney's Office as well as the sustained professionalism exhibited by our investigative staff and partner agencies in getting to this result.”

The case was investigated by the Amtrak Office of Inspector General, the Federal Bureau of Investigation, U. S. Department of Transportation Office of Inspector General, and the Internal Revenue Service, and is being prosecuted by Assistant United States Attorney Eric Gibson.

PHILADELPHIA – United States Attorney William M. McSwain announced today that Ahmad Jamaal Becoate, 32, of Greensboro, North Carolina, was sentenced to 75 months’ imprisonment by United States District Judge Joseph Leeson, sitting in Allentown.  The court also ordered the defendant to pay $443,542 in restitution and entered a forfeiture money judgment in the amount of $132,542.61.  The defendant pleaded guilty in February 2019 to charges including conspiracy to commit wire fraud and pass counterfeited securities, three counts of wire fraud, and aggravated identity theft.

Becoate and eight others were charged in December 2018 by superseding indictment for involvement in an extensive scheme to defraud Walmart stores across the United States using counterfeit checks and stolen social security numbers.  The conspiracy operated from at least June 2016 to July 2018.  In January 2017, the defendant was charged and convicted in Michigan state court while perpetrating this scheme; he was sentenced to serve 12 months in prison on the state charge.  But within days of being released from prison, the defendant went right back to the same illegal, fraudulent behavior.  Becoate and his co-conspirators presented in total more than $1,000,000 in fraudulent checks between June 2016 and July 2018.

“Becoate has spent much of his adult life in prison and has shown time and again that he has no regard for the law,” said U.S. Attorney McSwain.  “For years, the defendant victimized multiple businesses and individuals and his actions show he refuses to be deterred from fraud.  For these reasons, he will now spend additional significant time in prison – which is exactly where he belongs.”

“Today’s sentencing should serve as a strong deterrent to organized criminal groups considering taking part in similar fraud schemes,” said Special Agent in Charge James Henry of the Secret Service Philadelphia Field Office.  “This case highlights our outstanding relationship with the U.S. Postal Inspection Service and the Social Security Administration.  We will continue to work with our law enforcement partners to disrupt criminal groups in the state of Pennsylvania who attempt to defraud our community and its citizens.”

The case was investigated by the United States Secret Service, the Social Security Administration – Office of Inspector General, and the United States Postal Investigative Service, and is being prosecuted by Assistant United States Attorney Mary Crawley.

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that Damon Edwards, 33, of Philadelphia, Pennsylvania, was sentenced today to 18 years in prison by the Honorable Judge Paul S. Diamond.

Edwards was a leader of a violent drug trafficking group that had operated out of the Norman Blumberg Apartment Complex, a public housing facility in Philadelphia. Edwards pleaded guilty to conspiracy to distribute 280 grams or more of crack cocaine and distribution of crack cocaine within 1,000 feet of public housing (a drug-free zone).

Edwards and others controlled drug sales in various areas of the public housing facility from 2012 to 2014.  These leaders obtained bulk crack and cocaine; cooked and packaged crack cocaine into bundles; hired, fired, and supervised shift sellers and lookouts; levied taxes on members and customers; and provided protection from other drug trafficking groups.  The shift sellers were the daily workers employed by the leaders to sell crack cocaine in the locations controlled by the groups, while the lookouts assisted other members of the groups by alerting them to the presence of law enforcement and directing customers to the shift sellers. 

“This violent drug trafficking group, led by Edwards, sold crack cocaine 24 hours a day, 7 days a week, in and around the Norman Blumberg Apartment Complex in North Philadelphia,” said U.S. Attorney McSwain.  “This group used and carried firearms, robbed rival drug dealers, and used intimidation, threats, and violence to further its drug trade.  Philadelphia residents can rest assured that my Office will continue to aggressively investigate and prosecute cases like this to keep citizens safe and to dismantle the crack cocaine trade.”

“The investigation, arrest, and successful prosecution of Damon Edwards are evidence of the merits of consistent inter-agency collaborations,” said Philadelphia Police Commissioner Richard J. Ross, Jr.  “We believe strongly in the value of these multi-tiered collaborative efforts. Mr. Edwards is a member of a violent drug trafficking organization. With his conviction and attendant sentencing, a prolific narcotics offender will be removed from the communities in which he distributed illegal and dangerous substances. We anticipate that arrests, convictions, and sentences such as this, will continue to have an appreciable impact on the safety and quality of life of our city's residents and visitors.”  

This case was investigated by the United States Attorney’s Office, Federal Bureau of Investigation, and Drug Enforcement Administration in collaboration with the Philadelphia Police Department and Philadelphia District Attorney’s Office.  It is being prosecuted by Assistant United States Attorneys Jerome Maiatico and Yvonne Osirim.

PHILADELPHIA – United States Attorney William M. McSwain announced that Neil I. Mittin, age 64, of Huntingdon Valley, Pennsylvania was charged by Information with one count of mail fraud. The defendant was an attorney who worked for approximately 38 years as an associate for a Philadelphia, Pennsylvania law firm (“the Law Firm”). The Law Firm specialized in representing plaintiffs in personal injury matters while also representing individuals in other types of legal matters.

As detailed in the Information, over the course of approximately a decade, from 2008 through 2018, Mittin engaged in a scheme to steal numerous personal injury and other legal matters from the Law Firm by removing them from the Law Firm and referring them to outside attorneys. The clients of the Law Firm whose matters Mittin stole did not ask him to refer their matters to outside attorneys, and often did not know or understand that Mittin was referring their matters to outside attorneys. The defendant concealed his conduct from the Law Firm by closing the files for those matters and making it appear in the records of the Law Firm that there was no settlement or resolution and that the cases were not viable.

Following the fraudulent referrals, the other outside attorneys to whom Mittin referred these matters then undertook the representation of the former clients of the Law Firm and attempted to resolve the matters with a settlement or a trial. If the matter was resolved successfully, those attorneys paid Mittin a referral fee, on average, of between 33 and 40 percent of the contingency fees obtained by the attorneys plus reimbursement of the costs incurred by the Law Firm before Mittin had referred the cases to the other attorneys. The defendant pocketed the payments from the outside firms, including the reimbursement for costs incurred by the Law Firm, and did not disclose to the Law Firm that the matters were resolved in this fashion.

The personal injury and other legal matters that the defendant referred to other lawyers generated approximately $10,800,000 in financial recoveries for the former clients of the Law Firm. As a result of this scheme, Mittin defrauded the Law Firm of approximately $4,200,000 in legal fees and costs, including the share of those fees and costs that he obtained from the outside lawyers.

“Attorneys of any kind, public or private, take an oath to act in accordance with the law – they are and should be held to a high standard of conduct,” said U.S. Attorney McSwain.  “As alleged, the defendant defrauded his employer of millions of dollars, which is illegal conduct for an employee in any line of work, but is especially egregious for a lawyer.”

“Mittin allegedly diverted millions of dollars of business from his longtime employer, for his own benefit,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “Anyone willing to break the law and commit such fraud will be investigated and properly held accountable.”  

If convicted, the defendant faces a maximum possible sentence of 20 years in prison.

The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Deputy United States Attorney Louis D. Lappen.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William McSwain announced that Hamed Ettu, 44, of Richmond, TX was sentenced today to three years’ probation, the first nine months of which he will be required to serve in home confinement, 120 hours of community service and a fine of $15,000.  U.S. District Judge Gene E.K. Pratter also imposed a forfeiture judgment of $73,244, which the defendant has already paid.

The defendant pleaded guilty in February 2019 to an Information charging him with conspiracy to commit securities fraud. According to the Information, Damilare Sonoiki, charged elsewhere, then a junior analyst at a global investment bank in New York, provided material non-public information to Ettu. Sonoiki obtained this information in violation of his duty of confidentiality that he owed to the investment bank.  In a separate case, Sonoiki also allegedly passed inside information to former Philadelphia Eagles linebacker Mychal Kendricks.

Relying on the material non-public information he received from Sonoiki, Ettu illegally purchased call options in the target companies, Compuware and Move, between July and September 2014.  When proposed mergers were announced for each company, the value of Ettu’s options increased significantly.  During the period of the conspiracy, Ettu made a profit of more than $93,000 on the trades.

“This type of illegal behavior – insider trading based on material, non-public information – undermines faith in our financial markets and harms ordinary investors who play by the rules,” said U. S. Attorney McSwain.  “Prosecuting securities fraud and thereby safeguarding the integrity of the public securities markets has been and will continue to be a top priority of my Office.”  

“The manipulation of our markets undermines all the investors who take great care to play by the rules,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “Through cases like this, the FBI continues to work against such corruption to help ensure fairness in the marketplace.”

The case was investigated by Federal Bureau of Investigation and the Securities and Exchange Commission, and is being prosecuted by Assistant United States Attorney David J. Ignall.

PHILADELPHIA – United States Attorney William M. McSwain announced today that Gregory Dow, 60, of Lancaster, PA was arrested and charged by Indictment with four counts of engaging in illicit sexual conduct in a foreign place.  In a news conference at the Lancaster County Courthouse, U.S. Attorney McSwain discussed the charges in the Dow Indictment and also highlighted broader efforts of the U.S. Attorney’s Office for the Eastern District of Pennsylvania to protect the residents of Lancaster County.

The Indictment alleges that from on or about October 14, 2013, until on or about September 13, 2017, the defendant engaged in, and attempted to engage in, illicit sexual conduct with four different minor victims in Kenya. The defendant allegedly traveled from Lancaster County to Kenya in 2008 and started what came to be known as the Dow Family Children’s Home.  He did so with the financial support of his church and other organizations.  The defendant purported to be a Christian missionary who would care for these orphans, who called him “Dad.”   But instead of being a father figure to them, he allegedly preyed on their youth and their vulnerability.  The orphanage closed in September 2017, and the defendant now stands accused of sexually abusing at least four minor girls who lived there during that time.

U.S. Attorney McSwain also discussed recent Lancaster criminal and civil cases handled by his Office, many of which his Office adopted in collaboration with the local authorities who originally investigated the crimes. 

The criminal cases include: a knifepoint carjacking in Lancaster by a Harrisburg, PA man, Suudimon Washington; the alleged attempted robbery of Smithgall’s Pharmacy in Lancaster by four men, Lamar Black, Brandon Galette, Andrew Garrett, and Johnny Straining; the alleged arson of Lancaster City Hall by Dwain London and Patrick Baker; and the alleged illegal possession of a stockpile of 27 firearms and ammunition by a convicted felon living in Lancaster, Tyshaun Williams. 

The civil cases include: a civil action against Miller’s Organic Farm of Bird-in-Hand, PA to compel the owner to comply with the federal government’s basic food safety laws and regulations, and a settlement agreement with Lancaster General Hospital’s Division of Maternal Fetal Medicine resolving allegations of false claims submitted to Medicare for reports on obstetric ultrasounds that were significantly delayed.

“All of these cases tell a story about my Office working to bring justice to every corner of our District – from Philadelphia, to the Lehigh Valley, to right here in Lancaster,” said U.S. Attorney McSwain. “I am committed to bringing the resources of my Office here to help ensure that the people of Lancaster can live in safety and security.  We will hold lawbreakers accountable using all of the tools at our disposal.”

The Dow case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice.  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.

The Dow case was investigated by the Federal Bureau of Investigation, with assistance from the Lancaster City Bureau of Police and the East Hempfield Township Police Department. It is being prosecuted by Assistant United States Attorney Timothy Stengel of the Eastern District of Pennsylvania and Department of Justice Trial Attorneys Lauren Britsch and Lauren Kupersmith of the Child Exploitation and Obscenity Section (CEOS).

An Indictment, Information, or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that defendants Khaiyri Burgess, 20, and Shaquan Johnson, 20, both of Philadelphia, PA, were charged by Indictment today with Hobbs Act robbery and using, carrying and brandishing a firearm during commission of that crime.

On August 8, 2018, the defendants and a third accomplice victimized a 17-year-old girl in her Italian Market home while stealing approximately $1 million in U.S. currency and jewelry owned by her parents.  Specifically, at midnight, while she lay sleeping, the men entered her bedroom, pulled her from her bed, and struck her several times.  They then held her at gunpoint and robbed her family of their life savings—the proceeds of their restaurant business a block-and-a-half away on Washington Avenue in South Philadelphia.

“As alleged in the Indictment, the complete disregard that these defendants had for the safety of others, especially for a child, is appalling,” said U.S. Attorney McSwain. “No one should need to worry about having their home robbed, their child dragged out of bed and pistol whipped, and their life savings stolen.  This Indictment is an example of how my Office is working to get dangerous criminals off the streets of Philadelphia.”

“ATF’s primary mission is to reduce violent crime and protect the citizens of our communities,” said Special Agent in Charge Donald Robinson. “This indictment is a perfect example of our long-standing working relationships with the Philadelphia Police Department and US Attorney’s Office to aggressively address violent crime and to hold those responsible accountable.”

"The arrests of Khaiyri Burgess and Shaquan Johnson, and the investigation which led to them, are evidence of the merits of strong and consistent inter-agency collaborations,” said Philadelphia Police Commissioner Richard Ross. "Project Safe Neighborhoods promotes, and provides a platform for, these multi-tiered collaborative efforts. With these arrests, two dangerous offenders will be removed from the communities which they have victimized. We anticipate that arrests like these will continue to have an appreciable impact on the safety of our city's residents and visitors."

This case was brought as part of Project Safe Neighborhoods (PSN), a nationwide program by the Department of Justice that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone.  The Department has made turning the tide of rising violent crime in America a top priority.  In October 2017, to address this crime trend, the Department announced the reinvigoration of PSN. For more information about PSN, visit our website.

If convicted, each defendant faces a maximum possible sentence of life imprisonment, a mandatory minimum 7 years’ imprisonment consecutive to any other sentence of imprisonment imposed; up to 5 years’ supervised release; a $500,000 fine; and a $200 special assessment.  They will also be required to forfeit the proceeds of their offense.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorneys Jeanine Linehan and Sarah Damiani.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Joshua Padilla, 33, of Eatontown, New Jersey was charged by Indictment with producing, distributing, and possessing child pornography. The defendant was previously charged with multiple related felonies in February 2019 by Pennsylvania Attorney General Josh Shapiro.

The defendant, a Middlesex County Sheriff’s Deputy, recorded himself having unlawful sexual contact with a 17 year-old girl and later uploaded some of that video to an online platform.  The defendant drove the minor to Northampton County, Pennsylvania to engage in this illicit sexual conduct. 

 “The allegations in this case are particularly disturbing because of the defendant’s position of authority and trust in the community as a law enforcement officer,” said U.S. Attorney McSwain. "We stand ready with our federal, state and local partners to identify and prosecute those who would prey upon minor children – no matter who they are.”

 “As a member of law enforcement, this defendant was sworn to protect the people he served, but instead he stands charged with abusing and exploiting a minor,” said Attorney General Josh Shapiro. “I’m proud to stand with our federal law enforcement partners in our steadfast commitment to investigating and prosecuting anyone who takes advantage of children wherever we find them—without fear or favor.”

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

If convicted, the defendant faces a maximum possible sentence of 60 years’ incarceration with a mandatory minimum term of 15 years’ imprisonment.

The case was investigated by the Pennsylvania Attorney General’s Office, the Pennsylvania State Police, and Homeland Security Investigations, and is being prosecuted by Assistant United States Attorney Josh A. Davison.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that former U.S. Congressman Chaka Fattah, Sr., 62, of Philadelphia, PA was resentenced to 10 years of incarceration by United States District Judge Harvey Bartle, III. 

After a month-long trial in 2016, a federal jury found defendant Fattah and various co-defendants guilty of racketeering conspiracy, wire fraud conspiracy, honest services wire fraud conspiracy, mail fraud conspiracy, and multiple counts of mail fraud, falsification of records, mortgage fraud, and false statements to a financial institution.  The criminal conduct of Fattah and his racketeering enterprise was organized around five corruption and fraud schemes:  a loan repayment scheme, a Blue Guardians scheme, a college tuition scheme, a mortgage fraud scheme, and a fake conference scheme.  For his role in these schemes, Fattah was sentenced after trial to 10 years of incarceration.

Both parties appealed.  With regard to Fattah’s appeal, the Court of Appeals remanded for a new trial as to certain bribery and money laundering counts, concluding that the jury had not been properly instructed regarding “official acts” in a bribery context.  (The government thereafter announced its intention not to retry those counts.)  With regard to the government’s cross-appeal, the Court of Appeals reinstated certain counts that had been dismissed by the District Court post-trial.   The case was then remanded for resentencing.  Today, for these additional counts, Fattah was again sentenced to 10 years of incarceration.

“Let today serve as a warning to all public officials who allow greed or a thirst for influence to overpower any desire to serve the community honestly,” said First Assistant U.S. Attorney Williams.  “If you are a corrupt official, we will investigate and convict you, and we will remain steadfast behind our prosecution until the last appeal is wrapped up and the final proceeding complete.  Today’s sentencing illustrates the strength of our original case and the need to put Chaka Fattah behind bars for a very long time.”

The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service-Criminal Investigation, the Department of Justice Office of Inspector General, the NASA Office of Inspector General, the Department of Education Office of Inspector General, the Department of Commerce Office of Inspector General, and is being prosecuted by Assistant United States Attorneys Eric L. Gibson and Paul L. Gray.  Jonathan Kravis, former Trial Attorney with the Criminal Division’s Public Integrity Section of the U.S. Department of Justice, also prosecuted this matter.

PHILADELPHIA – United States Attorney William M. McSwain announced that ambulance companies Unicare Ambulance LLC and PA Paramedics LLC, d/b/a EasternCare Ambulance based in Bensalem, PA, their owners, Damon Wade, and Wade’s ex-wife, Amy Wade, also of Bensalem, have agreed to a judgment against them jointly and severally in the amount of $459,907.42 to resolve allegations made by the United States that they made repeated false statements to state and federal officials. As part of the settlement, each defendant has also agreed to a term of exclusion of not less than five years from all federal health care programs.

According to the allegations in the complaint filed in U.S. District Court, the defendants individually or collectively made repeated false statements, from September 2015 through August 2016, in order to avoid overpayment debts to the United States’ Medicare program and to hide the fact that Damon Wade’s state paramedic license had previously been suspended because he had admitted to forging a physician’s signature. When the Pennsylvania Department of Health eventually learned the truth, it immediately revoked Unicare’s ambulance license. Despite this revocation, Unicare continued to provide and bill Medicare for ambulance services, continued to make false statements about its ownership to state and federal authorities, and kept its fraudulently-obtained reimbursement funds.

The suspicious activity at Unicare and PA Paramedics was detected initially by the Centers for Medicare & Medicaid Services (CMS) of the United States Department of Health and Human Services, its local Medicare Administrative Contractor (Novitas Solutions, Inc.), and the United States Department of Health and Human Services Office of the General Counsel. In early 2018, the CMS Center for Program Integrity revoked Unicare’s Medicare enrollment for three years for this abusive and fraudulent conduct, and suspended all pending pre-revocation Medicare payments to Unicare.

“Ownership disclosure and licensing requirements ensure that healthcare in Pennsylvania is provided by qualified, competent, and trustworthy professionals,” said U.S. Attorney McSwain. “Attempts to undermine or defraud those systems put Pennsylvanians at risk and allow sleazy operators to continue providing services under new corporate identities. This settlement is the latest example of my Office’s commitment to using all of our enforcement tools to ensure that healthcare providers are legitimate and that any debts that they incur to American taxpayers are paid.”

“Medicare providers and suppliers cannot avoid repaying their overpayment debts by submitting false and misleading information in an attempt to mask their true identity,” said Alec Alexander, Deputy Administrator of the Centers for Medicare & Medicaid Services and Director for its Center for Program Integrity. “As this case shows, the Centers for Medicare & Medicaid Services uses its regulatory authorities and works closely with our partners, including the Department of Justice and the Office of Inspector General, to eliminate fraud, waste, and abuse from the Medicare and Medicaid programs.”

“Health companies that deceive regulators and taxpayers, as contended by the government in this case, cannot be tolerated,” said Maureen R. Dixon, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “Accordingly, the defendants have been barred from participating in all federal health programs for at least five years.”

This investigation was conducted with the Centers for Medicare & Medicaid Services, Department of Health and Human Services Office of Inspector General and the Department of Health and Human Services Office of General Counsel. For the United States Attorney’s Office, Assistant United States Attorneys Paul W. Kaufman and Matthew E. K. Howatt and auditor Denis Cooke handled the investigation and settlement.

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

PHILADELPHIA – United States Attorney William M. McSwain announced today that, on July 4, 2019, U.S. Customs and Border Protection (CBP) executed a seizure warrant obtained by the U.S. Attorney’s Office for the Eastern District of Pennsylvania, and seized the cargo vessel MSC Gayane as being subject to possible forfeiture to the United States. 

On June 17, 2019, federal, state, and local law enforcement agents boarded the MSC Gayane when it arrived at Packer Marine Terminal in Philadelphia and seized 19.76 tons of cocaine.  Since that time, crew members of the MSC Gayane have been charged with knowingly and intentionally conspiring with each other and others to possess more than five kilograms of cocaine on board a vessel subject to the jurisdiction of the United States.  The federal criminal investigation is ongoing.

As a result of this seizure, the MSC Gayane – a ship built in 2018 and measuring approximately two city blocks in length – has been placed under the custody of CBP and shall remain so until further proceedings or Order of the Court.

“A seizure of a vessel this massive is complicated and unprecedented – but it is appropriate because the circumstances here are also unprecedented.  We found nearly 20 tons of cocaine hidden on this ship,” said U.S. Attorney McSwain. “When a vessel brings such an outrageous amount of deadly drugs into Philadelphia waters, my Office and our agency partners will pursue the most severe consequences possible against all involved parties in order to protect our district – and our country.”

“The MSC Gayane is the largest vessel seized in U.S. Customs and Border Protection’s 230-year history and follows the record seizure of almost 20-tons of cocaine discovered on the vessel,” said Casey Durst, CBP’s Director of Field Operations in Baltimore. “Seizing a vessel of this size is an unusual enforcement action for CBP, but is indicative of the serious consequences associated with an alleged conspiracy by crewmembers and others to smuggle a record load of dangerous drugs through the United States.  This action serves as a reminder for all shipping lines and vessel masters of their responsibilities under U.S. and international law to implement and enforce stringent security measures to prevent smuggling attempts such as this.”

“The seizure of the MSC Gayane is another significant step toward holding accountable those who perpetuate drug smuggling crimes both here in Philadelphia and around the world,” said Marlon Miller, Special Agent in Charge of HSI Philadelphia. “HSI, in collaboration with CBP, the Coast Guard, and our state and local law enforcement partners continue to aggressively work with the U.S. Attorney’s Office for the Eastern District of Pennsylvania to comprehensively investigate this case and bring to justice those who had roles in this drug smuggling venture.”

The case is being investigated by the United States Customs and Border Protection and Homeland Security Investigations, together with a multi-agency team of federal, state, and local partners.

PHILADELPHIA – United States Attorney William M. McSwain announced that Myles Hannigan, 48, of Newtown Square, Pennsylvania, was charged by Information with one count of obstructing the due administration of the Internal Revenue Service (IRS), and seventeen counts of preparing materially false income tax returns.

Hannigan owned and operated Payroll Professionals, Incorporated (“PPI”), which operated out of Media, Pennsylvania.  PPI is a third-party payroll processor that assists its clients by issuing payroll checks and forwarding tax payments to federal, state, and local authorities.  PPI’s clients were small to medium-sized businesses, and the clients relied on Hannigan to prepare and file Form 941 with the IRS.  Form 941 details employee wages that were paid by a company and income tax withheld and paid to the IRS based on those wages. 

Beginning in January 2012 and continuing up to December 2016, Hannigan allegedly prepared and submitted Form 941s that falsely reported information to the IRS.  In particular, Hannigan reported depositing more money to pay tax debt than he actually had sent to the IRS, causing 35 of PPI’s client companies (who are considered victims in this case) to collectively underpay the IRS $3,270,566.89 for those tax years.  These victims/companies gave Hannigan access to all necessary funds to pay the full tax debt, but Hannigan allegedly failed to do so.  Hannigan hid his behavior from these victims/companies by presenting bogus documents that purported to be confirmation of payments of taxes he had made to the IRS on their behalf, and by re-directing IRS correspondence to his business address.  In essence, Hannigan is alleged to have operated a “Ponzi scheme” of borrowing from one client’s money to pay the debts of another, which collapsed when the interest and penalties owed to the IRS (which he was hiding from clients) became too big to hide.

“As alleged in the Information, this defendant – an accountant in business to handle payroll taxes – committed fraud and stole from clients and the United States government,” said U.S. Attorney McSwain.  “He also stole from the pockets of all taxpayers who do the right thing by paying their taxes.  It will continue to be a priority of my Office to bring tax cheats to justice and thereby protect honest taxpayers.”

If convicted, the defendant faces a maximum possible sentence of up to 54 years in prison, one year of supervised release, a fine of up to $1,805,000, and a special assessment of $1,800.

The case was investigated by the Internal Revenue Service (IRS), and the Treasury Inspector General for Tax Administration (TIGTA), and is being prosecuted by Assistant United States Attorney Jason P. Bologna.

An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – United States Attorney William M. McSwain announced that Kevin Elcock, 33, of Newark, NJ was sentenced to 30 months’ incarceration by U.S. District Court Judge Jeffrey Schmehl.

The defendant was sentenced after pleading guilty to seven counts of making false statements to federally licensed firearm dealers in Northampton and Bucks Counties.  From December 27, 2016 through July 31, 2018, on seven different occasions, Elcock lied about his state of residence – claiming that he lived in Pennsylvania when he actually lived in New Jersey.  Those lies were a federal crime.  The defendant lied in this manner because he claimed it was “easier” to purchase firearms in Pennsylvania than in New Jersey.   The defendant then sold many of the guns that he purchased to people with criminal histories who would otherwise not have been able to purchase weapons legally.

“Federal laws for purchasing and owning firearms exist to protect public safety, and this defendant purposefully and arrogantly flouted those laws,” said U.S. Attorney McSwain.  “Reducing violent crime by keeping illegal guns off of our streets is a top priority for the Department of Justice and my Office.”

This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone.   The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and is being prosecuted by Assistant United States Attorney Priya T. De Souza.

PHILADELPHIA – United States Attorney William M. McSwain announced that Dean Volkes, 55, Donna Fallon, 54, both of Long Island, NY, and Devos Ltd., doing business as Guaranteed Returns, also located in Long Island, were sentenced to five years’ incarceration, one year and one days’ incarceration, and five years’ probation, respectively, by U.S. District Judge Petrese Tucker.  Additionally, Volkes and Guaranteed Returns were each ordered to forfeit $114,832,445.62 and pay restitution of $95,253,090.05, and Fallon was ordered to pay $515,221.89 in restitution.  Volkes, Fallon, and the company were convicted at trial in March 2017 of mail fraud, wire fraud, theft of government property, money laundering conspiracy, obstruction of justice, and false statements in connection with a scheme to steal money from clients who relied on the business to return unused pharmaceutical products.

Volkes was the President, Chief Executive Officer, and sole owner of Guaranteed Returns, a reverse pharmaceutical distributor located in Holbrook, New York.  Fallon, who is Volkes’ sister, was the company’s Chief Financial Officer.  As a reverse distributor, Guaranteed Returns managed the returns of pharmaceutical products for healthcare providers, including numerous hospitals, pharmacies, and long-term care facilities, as well as Department of Defense facilities.  Pharmaceutical manufacturers often allow expired drugs to be returned for a refund.  Guaranteed Returns handled this process for healthcare provider clients in exchange for a fee based on a percentage of the return value.       

The evidence presented at trial proved that from approximately 1999 through 2014, Guaranteed Returns promised its clients that it would hold their “indate” (not yet expired) drug products until they expired, and then return them on the clients’ behalf, in exchange for a fee.  Instead, Guaranteed Returns, at CEO Volkes’ direction, stole indated drug products that it received from its clients, returned the drugs to manufacturers, and kept the refund money.  Volkes created a system in which he classified clients as either “managed” or “unmanaged.”  While both categories of clients were victimized, Volkes reserved special treatment for “unmanaged” clients by stealing what he could from them by ensuring that Guaranteed Returns kept the full value of the returned product for itself.  The evidence demonstrated that through this fraud, Volkes and Guaranteed Returns stole more than $100 million from over 13,000 clients, including more than $20 million from numerous medical treatment facilities operated by the U.S. Department of Defense and other government agencies. 

The evidence also showed that Volkes, Fallon, and Guaranteed Returns stole clients’ refund money by diverting a percentage of the refunds into internal company accounts, conspired to launder the proceeds of the fraud, and obstructed justice in connection with a grand jury investigation. 

“The defendants and their company took advantage of their own clients, stealing millions of dollars, and then committed further crimes by attempting to cover up the fraud,” said U.S. Attorney McSwain.  “This kind of fraud netted the defendants exactly what they deserve – a trip to prison.  My Office and our law enforcement partners will not allow dishonest businesses like this to steal from customers – which, in this case, included American taxpayers.”

“At each turn, these defendants’ guiding principle was greed,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “For years, they ripped off clients – among them, the U.S. government – to the tune of millions of dollars. They’re now being held accountable for their scheme, and for their brazen attempts to cover it up by obstructing justice. The FBI and our federal partners won’t stand for criminals stealing from the government and the taxpayers who fund it.”

“These sentencings are the direct result of a joint effort by the Defense Criminal Investigative Service (DCIS), the FBI and the U.S. Attorney’s Office, Eastern District of Pennsylvania,” stated Leigh-Alistair Barzey, Special Agent in Charge of the DCIS Northeast Field Office.  “The fraudulent conduct in this case was particularly egregious and undermined the integrity of the U.S. Defense Department’s procurement system.  DCIS is committed to working with its law enforcement partners to identify, investigative and prosecute individuals and companies who defraud the U.S. Government and the American taxpayer.”

The case was investigated by the Defense Criminal Investigative Service and the Philadelphia office of the Federal Bureau of Investigation.  It is being prosecuted by Assistant United States Attorneys Nancy Rue and Patrick J. Murray.