Eastern District of Pennsylvania

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Dr. Domenick Braccia, 57, of Perkasie, PA entered a plea of guilty before Judge Wendy Beetlestone on one count of conspiracy to commit health care fraud.  The charges against the defendant stem from federal and state investigations into an elaborate insurance fraud scheme involving a Bucks County-based addiction treatment center, Liberation Way.

Dr. Braccia served as the Medical Director of Liberation Way, and, as the sole doctor, was the head of medical treatment at all three of its facilities.  As such, he was tasked with overseeing the care of all the patients seeking addiction treatment, ordering all medically necessary tests, evaluating the results of all medical tests and incorporating their results into any treatment plan, prescribing medications, and overseeing the staff who were tasked with other non-medical therapy and care of patients.  However, Braccia did not provide the amount of medical care that was billed to insurance companies in his name, and he never even stepped foot in one of the three treatment centers that billed in his name. 

Instead, Braccia signed blank forms and patient orders, averred to the medical necessity of testing for patients whom he never saw, prescribed for patients he did not see, and signed blank prescription forms.  As a consequence, insurance companies lost millions of dollars paying for care that was not provided by Braccia, and patients did not receive the individualized medical care they needed.

State and federal criminal charges were announced in March 2019 against eleven people and nine businesses in connection with this health care fraud case.  The investigation revealed an array of health care fraud schemes committed by individuals associated with Liberation Way, which is based in Yardley, Bucks County and has two other locations in Bala Cynwyd and Fort Washington, Montgomery County.  These schemes included Braccia’s over-billing scheme as well as an elaborate kick-back scheme involving thousands of medically-unnecessary urine tests which were sent to the Florida-based laboratories for analysis.

“This prosecution and today’s guilty plea should send a clear message to those seeking to build their fortunes on fraud and the despair of individuals battling addiction:  health care fraud and the opioid epidemic are major priorities for the United States Attorney’s Office, and your illegal actions will be uncovered and prosecuted,” said First Assistant United States Attorney Jennifer Arbittier Williams.  

“This doctor was responsible for overseeing the medical care of people suffering from opioid addiction, and instead he conspired to commit fraud by signing blank prescription forms and attesting to treatment for patients he did not see,” said Pennsylvania Attorney General Josh Shapiro. “He did these acts to help perpetrate a massive insurance fraud that lined the pockets of Liberation Way’s founders and co-conspirators with millions of dollars. I am grateful for our partners in the U.S. Attorney’s Office, the FBI, and other agencies in Pennsylvania and Florida for their hard work in bringing this defendant to justice.”

“At Liberation Way, medical practices were shoddy and substantive treatment minimal,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “Dr. Braccia abrogated his professional ethics and responsibilities in order to line his pockets and is now being held accountable for his actions. The FBI will continue to make health care fraud investigations a priority, to the benefit of both patients and taxpayers.”

 “This case demonstrates the commitment of the OPM OIG, the Department of Justice, and our law enforcement partners to ensuring that federal health care programs, including the Federal Employees Health Benefits Program, are protected from fraud and abuse,” said Thomas W. South, Deputy Assistant Inspector General for Investigations, U.S. Office of Personnel Management.  “I am immensely proud of the work our office has done to not only safeguard taxpayer dollars, but also protect the health and wellbeing of federal employees, annuitants, and their families.”

The case was investigated by the Federal Bureau of Investigation, Department of Health and Human Services, the Office of Personnel Management, and the Department of Labor, and is being prosecuted by Assistant United States Attorney Nancy Beam Winter.

 

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Danielle Sebenick, 27, of Glenside, PA entered a guilty plea today before the Honorable Petrese B. Tucker, admitting to the crimes of possession and distribution of child pornography.

Sebenick was indicted by a federal grand jury in January of 2019 as a result of her trafficking in videos of child pornography on the Internet during November of 2018, while she was employed at the Kids First Swim School in Jenkintown, PA.

“Not only did this defendant commit the heinous crime of possessing and distributing child pornography, she did it while employed at a business that specializes in teaching children an important life skill,” said U.S. Attorney McSwain.  “Parents and caregivers bring their children to facilities like this with the expectation that the staff will teach them and keep them safe; they shouldn’t be worried that their children are in the presence of a sexual predator.”

“Homeland Security Investigations will remain steadfast in our dedication to identify, investigate and apprehend those who abuse the most vulnerable of our society – our children,” said Marlon V. Miller, special agent in charge of HSI Philadelphia. “Investigating and prosecuting the perpetrators of these horrendous crimes is one of our highest priorities and HSI will continue to work with our law enforcement partners to bring these criminals to justice.”

The case was investigated by Homeland Security Investigations.  It is being prosecuted by Assistant United States Attorney Kelly Harrell.

EASTON, PA – U.S. Attorney William M. McSwain announced that Martin Castro-Molina, a/k/a “Jose Noe Galsano-Castellano”, 42, of Bethlehem, PA was found guilty by a federal jury of one count of reentering the United States after deportation. He was removed from the United States on three prior occasions between 2008 and 2017, before being found unlawfully in the United States on or about August 24, 2018. At the time of his arrest, the defendant gave multiple fictitious names to authorities.

“The defendant in this case clearly has no respect for the laws of this country,” said U.S. Attorney McSwain.  “After being removed on three previous occasions, Castro-Molina decided yet again to snub our immigration system by entering the United States illegally.  I am glad that the jury in this case agreed and held him responsible for his actions.”

“The brave men and women of ICE contribute to making our communities safer by arresting criminal aliens like Martin Castro-Molina,” said Simona L. Flores, Field Office Director for ICE Enforcement and Removal Operations (ERO) Philadelphia. “We will ensure that aliens who may pose a threat to our communities are not released onto the streets to potentially reoffend and harm individuals living within our communities.”

The case was investigated by the Department of Homeland Security, Immigration and Customs Enforcement, and is being prosecuted by Assistant United States Attorneys Meaghan Flannery and Jose Arteaga.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Eugene Smith, 45, of Lithonia, GA was sentenced today to 51 months imprisonment after being convicted of conspiracy to commit wire fraud, wire fraud, conspiracy to traffic in counterfeit goods, and trafficking in counterfeit goods, arising from Smith’s leadership role in the production and sale of counterfeit tickets to sporting events, including the National Football League’s Super Bowl LI (51) in Houston (between the Patriots and the Falcons) and Super Bowl LII (52) in Minneapolis (between the Eagles and the Patriots), a National Basketball Association All-Star game, National Collegiate Athletic Association Championship football and basketball games, and other sporting events and concerts. The counterfeit tickets bore the authentic trademarks of the respective organization or agency that was registered with the United States Patent and Trademark Office. Smith sold the counterfeit tickets at the various venues and also distributed the counterfeit tickets to other sellers nationwide for resale to victims.

Smith targeted events and victims based on profitability – the bigger the event, the bigger the payoff. The scheme involved several steps and multiple players: after determining which events would draw the most profit, Smith provided a real ticket to the event to his printer for use in the production of multiple tickets for the event.  Smith would then travel to venues to sell the counterfeit tickets or he provided the counterfeit tickets to other sellers to resell to unwitting fans. This scheme involved sophisticated printing that mimicked the authentic tickets’ markings and hologram.  

At Smith’s sentencing hearing, Eric Ferguson, who was also charged with the same offenses, testified that he was recruited by Smith to produce the counterfeit tickets for the sporting events and concerts. The government presented evidence that the face value of the counterfeit tickets printed by Ferguson was at least $170,000, but the government estimated that the actual resale value of the tickets, particularly the Super Bowl tickets, far exceeded their face value.

“This case isn’t just about taking advantage of sports fans’ willingness to spend their hard-earned dollars to enjoy a game; this is about ensuring that consumers of all types can trust that when they spend their money, they are getting the authentic product for which they paid,” said U.S. Attorney McSwain.  “Smith is nothing more than a con-artist and thief, and I’m grateful that the judge saw it that way and gave him a sentence that ensures justice for his victims.”

The case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant United States Attorneys Joan E. Burnes and Anita Eve.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Cameron Carlucci, 27, of Philadelphia was sentenced by the Honorable Berle M. Schiller to 151 months in federal prison, followed by 10 years supervised release.  Carlucci was convicted of distributing and possessing child pornography from 2016 through his arrest in 2018.   During that time, he amassed more than 56,000 images and videos that depicted mostly prepubescent boys, infants, and toddlers being sexually abused and exploited. 

At the time that Carlucci distributed these images and videos over the Internet, he had already been convicted in Philadelphia in 2011 for possession of obscene and other sexual materials, for which he received a 5-year probationary sentence.  Almost immediately after the termination of his probation, Carlucci began committing the sexual crimes against children in this case.  At the same time that he was committing these crimes, Carlucci sought out and obtained employment at Valley Pediatrics in Warminster, PA as a medical technician.  To obtain his employment with Valley Pediatrics, Carlucci falsified his application by denying his criminal history.

“Not only did this defendant commit the heinous crime of possessing and distributing child pornography, he lied to get a job that would put him in close proximity to children,” said U.S. Attorney McSwain.  “Parents and caregivers bring their children to doctors’ offices with the expectation that they will be safe and cared for, not in the presence of a known sexual predator.  We thank the judge in this case for ensuring that Carlucci will be behind bars and unable to be in contact with children for a very long time.”

The case was investigated by the FBI and is being prosecuted by Assistant United States Attorney Michelle Rotella.

PHILADELPHIA – William M. McSwain, U.S. Attorney for the Eastern District of Pennsylvania, and Brian A. Benczkowski, the Assistant Attorney General of the Criminal Division of the United States Department of Justice, announced that Kenneth Smukler, 58, a long-time Philadelphia-area political consultant and attorney, was sentenced today by the Honorable Jan E. DuBois to 18 months in prison, one year supervised release and a $75,000 fine for his role in two separate criminal schemes to violate federal campaign finance laws. 

The first scheme involved the 2012 Democratic primary election for Pennsylvania’s First Congressional District. Jimmie Moore, a former Philadelphia Municipal Court Judge, ran against the incumbent, Congressman Bob Brady. Moore struck a corrupt deal by which he agreed to withdraw from the race in exchange for funds from the Bob Brady for Congress campaign (the “Brady campaign”) to be used to pay off Moore’s campaign debts. Those debts included money that Jimmie Moore for Congress (the “Moore campaign”) owed to several vendors, to Moore himself, and to Moore’s campaign manager, Carolyn Cavaness.

On February 29, 2012, Moore withdrew from the race. Moore and Cavaness had prepared a list of debts owed by the Moore campaign which was subsequently provided to Smukler, a campaign consultant for the Brady campaign. Smukler arranged for the Moore campaign to receive $90,000 from the Brady campaign through false documents and a series of illegal pass-throughs, including the consulting firm of another Brady associate and co-conspirator, D.A. Jones. None of the payments, which exceeded the applicable contribution limits, was reported to the Federal Election Commission (“FEC”). Per the arrangement, the three installments were illegally disguised as payments for a poll and consulting services.

The second scheme involved the 2014 Democratic primary election for Pennsylvania’s Thirteenth Congressional District. Marjorie Margolies, a former member of the U.S. House of Representatives, was running in the primary and Smukler, a veteran of prior Margolies political campaigns, was running the Margolies campaign. By early April 2014, the primary race was close, and the Margolies campaign was running out of money that the campaign could legally spend in the primary. Smukler caused the Margolies campaign to illegally spend general election funds in his attempt to win the primary election for his candidate, then lied about it to the campaign’s lawyer. That lawyer, in turn, unwittingly reported the lies to the FEC in response to a complaint filed by one of Margolies’ opponents. Additionally, Smukler caused excessive campaign contributions and illegal conduit contributions, all of which were hidden in FEC filings.

On December 3, 2018, a jury found Smukler guilty of one count of conspiracy to defraud the United States; two counts of causing unlawful campaign contributions; one count of causing false campaign expenditure reports; two counts of causing false statements; two counts of making contributions in the name of another; and one count of obstruction.

“In order to win at all costs, Smukler knowingly and purposefully undermined our democratic process by misusing campaign funds and lying about it,” said U.S. Attorney McSwain. “My Office will continue to prosecute public corruption wherever and whenever we uncover it. Now Smukler is headed to jail, and I am grateful that the Court imposed a just sentence reinforcing the fact that this kind of corruption will never be tolerated.”

“Campaign finance laws exist to ensure transparency and fairness in the electoral process,” said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. “When corruption weakens the public's trust in that process, our democracy itself is dealt a blow. Kenneth Smukler played fast and loose with the system to try to give his candidates a leg up. He broke the law repeatedly and now is being held accountable.” 

The case was investigated by the Federal Bureau of Investigation, and the case is being prosecuted by Assistant United States Attorney Eric Gibson and Trial Attorneys Richard Pilger and Rebecca Moses of the Criminal Division’s Public Integrity Section. It was previously investigated by former Public Integrity Section Trial Attorney Jonathan I. Kravis.

A long-time Philadelphia-area political consultant and attorney was sentenced today for his role in two criminal schemes to violate federal campaign finance laws announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and U.S. Attorney William M. McSwain of the Eastern District of Pennsylvania.

Kenneth Smukler, 57, of Villanova, Pennsylvania, was sentenced to 18 months in prison followed by one year of supervised release by the Honorable Jan E. DuBois.  In the 2012 Democratic primary election for Pennsylvania’s First Congressional District, Jimmie Moore, a former Philadelphia Municipal Court Judge, ran against the incumbent Congressman Bob Brady.  Assisted and directed by Smukler, Moore executed a corrupt deal in which he agreed to withdraw from the race in exchange for funds from the Bob Brady for Congress campaign (the Brady campaign) to be used to pay off Moore’s campaign debts.  Those debts included money that Jimmie Moore for Congress (the Moore campaign) owed to several vendors, to Moore himself and to Moore’s campaign manager, Carolyn Cavaness. On Feb. 29, 2012, Moore withdrew from the race and Cavaness had prepared a list of debts owed by the Moore campaign, which they provided to Smukler, a campaign consultant for the Brady campaign.  Smukler arranged for the Moore campaign to receive $90,000 from the Brady campaign through false documents and a series of concealing pass-throughs, including the consulting firm of another Brady associate and co-conspirator, D.A. Jones.  Smukler ensured that the Brady campaign reported none of the concealed payments, which exceeded the federal contribution limits, to the Federal Election Commission (FEC).  Rather, he executed the scheme by ensuring that the three installments were falsely and illegally disguised from the FEC and the public as payments for poll and consulting services.

Later, during the 2014 Democratic primary election for Pennsylvania’s Thirteenth Congressional District, Smukler again committed federal campaign finance offenses, this time for the benefit of another client, Marjorie Margolies, a former Member of the U.S. House of Representatives.  Smukler, a veteran of prior Margolies political campaigns, ran the Margolies campaign in 2014. 

In April 2014, during a close primary race, the Margolies campaign was running out of money that it could legally spend in the primary.  Smukler then caused the Margolies campaign to illegally spend general election funds in his attempt to win the primary election for his client.  He further lied about his illegal spending to the campaign’s lawyer.  That lawyer, in turn, unwittingly reported Smukler’s lies to the FEC in response to a complaint filed by another candidate. Additionally, Smukler caused excessive campaign contributions and illegal conduit contributions to the Margolies campaign, all of which were hidden or disguised from the campaign’s FEC filings.

“When political operatives like Kenneth Smukler engage in hidden illegal campaign finance schemes, they undermine the integrity of the electoral process,” said Assistant Attorney General Benczkowski.  “This is a just sentence that reflects the seriousness of these crimes.”

“In order to win at all costs, Smukler knowingly and purposefully undermined our democratic process by misusing campaign funds and lying about it,” said U.S. Attorney McSwain. “My Office will continue to prosecute public corruption wherever and whenever we uncover it. Now Smukler is headed to jail, and I am grateful that the Court imposed a just sentence reinforcing the fact that this kind of corruption will never be tolerated.”

On Dec. 3, 2018, a jury found Smukler guilty of one count of conspiracy, two counts of excessive campaign contributions, two counts of false statements, two counts of conduit contributions, one count of willfully causing a false statement to the FEC and one count of obstruction of justice.     

Former Public Integrity Section Trial Attorney Jonathan I. Kravis and the FBI investigated the case.  Richard C. Pilger, Director of the Election Crimes Branch of the Public Integrity Section, Trial Attorney Rebecca Moses of the Public Integrity Section and Assistant U.S. Attorney Eric L. Gibson of the Eastern District of Pennsylvania prosecuted the case.

PHILADELPHIA – On May 1, 2019, United States Attorney William M. McSwain delivered the keynote address at a luncheon honoring the families of fallen Philadelphia police officers and firefighters.  The luncheon, hosted by the Fraternal Order of Police Lodge 5, immediately followed the Living Flame Memorial Service, an annual event honoring the men and women who lost their lives in service to the City.  U.S. Attorney McSwain was invited to speak, and introduced by, Lodge #5 President, John McNesby.

Remarks as Prepared for Delivery 

Thank you, John, for that kind introduction, for your friendship, and for your many years of dedicated leadership of the FOP.  I am grateful for the partnership that you have helped to foster between my Office and the Philadelphia Police Department.  I also want to thank the FOP’s Executive Leadership for your work in organizing today’s event.  It is an honor to be here with all of you on this important day of remembrance.  Police Commissioner Ross and Fire Commissioner Thiel, you are both trusted friends and I want to thank you for your service and for your partnerships with my Office.  I know I speak for everybody in my Office when I say that your rank-and-file members are the best law enforcement partners any prosecutor could ask for.

When I was at the Living Flame Memorial earlier today, I thought about what that light represented, which is each life that has been lost.  And I thought about the purpose of the event: to pay tribute to those who are missing from this crowd – those police officers and firefighters who made the ultimate sacrifice; those who gave their lives so that their fellow citizens could be safe and their communities secure. 

And it’s also a day to pay tribute to, and to support, each of you – the family and friends of these heroes.  We can never repay the debt that we owe to the fallen officers and firefighters and to their family members.  But what we can do is promise that we will work hard every day to make sure that the sacrifices you and your loved ones have made on behalf of this great City will never be forgotten.  And together we will keep their memories alive.

Public service is a noble calling, but the kind of public service we remember and celebrate today is truly special:  the kind where brave men and women put on their uniform every day in the knowledge that they may have to risk – and even give – their lives to protect others.  In doing so, they show their love for their community and their fellow citizens.  It is a powerful, awe-inspiring form of love because it is so generous and selfless.  It takes an extraordinary person to be willing to act in such a manner, to sign up for the job – and then to actually do it.  Such people are not takers, they are givers.  They don’t ask for much, if anything, in return.  But we must give them something.  We owe them something.

What we owe them – and their loved ones – is our sincere and solemn gratitude and support.  They have that – and you have that – from me and from every single member of my Office.  You also have that from the vast majority of your fellow citizens.  For example, just this past week, the Philadelphia Inquirer noted that, according to recent polling, the voters’ No. 1 issue was crime.  According to the voters in this City, it is the single biggest issue that city officials should be focused on – by far.  That means that the citizens of Philadelphia care deeply about the mission of the police and that they desperately need and want the police to aggressively investigate, punish, and deter crime. 

But what is upsetting to me – what bothers me to my core – is that there are public officials in this City who do not express the gratitude and support that the police deserve.  There are public officials in this City who in fact undermine the police and make their inherently difficult jobs even more difficult, if not impossible.  Those people do not understand and appreciate the sacrifices that you and your loved ones have made.  Those people do not understand and appreciate the dedication and bravery that makes you and your loved ones who you are.  Those people have no shame.  I say to you:  pay them no mind.  They are unworthy.

Instead, think of this:  think of how proud you are of your loved ones’ service.  Think of how proud they are, looking down on us today, for our gathering here in their honor, and for remembering, and promising to always remember.  And think of the love that binds you with them, and that binds you with this City.

In closing, I would like to leave you with one of my favorite Bible verses (from Galatians chapter 6, verse 9), because it sums up my feelings about today’s event and what it means.  In the words of the Apostle Paul, “Let us not become weary in doing good, for at the proper time we will reap a harvest if we do not give up.”     

Thank you, and God Bless you all.

PHILADELPHIA – United States Attorney William M. McSwain announced that Juan Manuel Bedolla-Lopez, 33, of Toughkenamon, PA, was charged today by indictment with illegal reentry after deportation. 

The indictment alleges that Bedolla-Lopez, an illegal alien, and native and citizen of Mexico, was previously deported from the United States on or about December 20, 2010, May 6, 2011, May 12, 2011, May 25, 2011, and March 19, 2012.  Following the latest of his five deportations, Bedolla-Lopez allegedly reentered the United States illegally.  If convicted of this current illegal reentry offense, the defendant faces a maximum possible sentence of two years’ imprisonment.

“The United States of America is a nation of laws, including laws about how people can enter the country,” said U.S. Attorney McSwain.  “This man has allegedly been removed from the United States five times, and yet he continues to reenter illegally and defy our laws.  This blatant flouting of our nation’s immigration laws will not be tolerated.”

The case was investigated by Immigration and Customs Enforcement, Enforcement and Removal Operations (“ERO”), and is being prosecuted by Special Assistant United States Attorney Mark T. Sendek.

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

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Paris Church, 57, of Chester, Pennsylvania was sentenced to 360 months’ imprisonment by United States District Judge Gerald A. McHugh.  Church was convicted three separate times by a federal jury in March 2016, February 2017, and again in June 2017 of multiple counts of conspiracy to distribute cocaine, crack cocaine and heroin, as well as related offenses in a case stemming from the investigation of a drug trafficking ring in Chester.

An investigation revealed that from about August 2012 until September 2014, Church and his criminal cohorts conspired to distribute illegal narcotics on the streets of Chester, PA.  More specifically, in early 2014, Church and his cohorts conspired to source roughly 20 kilograms of cocaine from a Mexican supplier.  Church was also involved in a conspiracy to receive illegal drugs from a supplier in California.

“Paris Church is a menace to the neighborhoods of Chester who needed to be convicted on federal charges three times to get the message: dealing illegal drugs and decimating neighborhoods will get you locked up for a long time,” said U.S Attorney McSwain.  “This type of drug trafficking is dangerous and fanning the flames of the drug epidemic in this country.  My office will investigate and prosecute these cases with tenacity in order to protect the community.”

The case was investigated by Drug Enforcement Administration, Federal Bureau of Investigation, City of Chester Police Department, Pennsylvania State Police, and Delaware County District Attorney’s Office Criminal Investigation Division, and is being prosecuted by Assistant United States Attorneys A. Nicole Phillips, Faithe Moore Taylor, and Robert E. Eckert.

PHILADELPHIA, PA – United States Attorney William M. McSwain and Assistant Attorney General Jeffrey Bossert Clark of the Environment and Natural Resources Division (ENRD) of Department of Justice announced today that a federal jury in Reading, Pennsylvania convicted David M. Dunham, Jr. of the following crimes: conspiracy to commit wire fraud and defraud the United States; wire fraud; filing false tax documents; and obstruction of justice.  The conviction stemmed from Dunham hatching and executing a scheme to defraud the Environmental Protection Agency, the Internal Revenue Service, the United States Department of Agriculture, and his customers to obtain renewable fuel credits in his “green energy” business.  The government is also seeking forfeiture of approximately $1.7 million in fraudulently obtained revenue and several parcels of real estate.  The trial lasted four weeks before United States District Judge Jeffrey L. Schmehl.   

In Dunham’s green energy scam, he fraudulently applied for, received, and sold “credits” for selling renewable biofuels that he, in fact, did not sell and, in many instances, had never possessed in the first place.  He obtained these credits from government agencies, which resulted in Dunham obtaining $50 million in fraudulent revenue.  Dunham ran the scam from approximately 2010 to 2015, using his business, Smarter Fuels, and that of his co-defendant, Ralph Tomasso, who previously pleaded guilty to conspiracy to defraud federal programs.

“Though this defendant tried to deflect blame on others, his years of scamming the government and his customers has finally caught up to him,” said U.S. Attorney McSwain.  “And the truth is as simple as this:  Everyone has to follow the rules.  You cannot lie, steal, or cover up your misdeeds.  If you do, we will hold you accountable.  Experience shows that fraudsters like Dunham are always looking for the next best scam.  As American consumers become increasingly more concerned with energy conservation, green energy scams like the one in this case provide criminals with an easy angle.  We are grateful that the jury saw through Dunham’s lies and reached the correct result.”

“Today’s conviction sends a clear message to any future fraudsters out there: crime does not pay. Especially when that crime involves defrauding American customers and multiple federal agencies,” said Assistant Attorney General Clark. “When the defendant knowingly cheated a federal government program aimed at energy conservation, he gave himself an unfair advantage over his competitors and stole millions of dollars from the American taxpayer in the process. The Department of Justice will not tolerate this type of deception and will continue to work with its law enforcement partners to root out this unlawful conduct.”  

“David Dunham created an elaborate scheme that served no purpose other than to mislead and defraud the government,” said IRS Special Agent in Charge Guy Ficco.  “Unfortunately for him, our special agents were able to track the movement of paperwork and uncover the deceit behind his actions. We, along with our fellow law enforcement partners and the Department of Justice, will continue to investigate and prosecute those who commit similar crimes.”

“The defendant made numerous fraudulent claims to illegally profit from the Renewable Fuel Standard (RFS) Program,” said Jessica Taylor, Director of EPA’s Criminal Investigation Division.  “Today’s conviction should send a clear signal that EPA and our law enforcement partners are committed to protecting the integrity of the Energy Independence and Security Act of 2007.”

USDA-OIG Special Agent-in-Charge Bethanne M. Dinkins said, “We appreciate the commitment of the Department of Justice and the cooperative efforts of our law enforcement partners throughout this significant investigation.  Mr. Dunham’s conviction at trial sends a strong message regarding the benefit of working across agency lines to protect the integrity of Government programs like the USDA Advanced Biofuel Payment Program, established in the 2008 Farm Bill as an incentive for companies to produce and use alternative fuel sources.  The USDA Office of Inspector General will continue to dedicate resources to protect the Department’s programs and assets by investigating those who commit fraud and compromise the integrity of USDA programs.”

The case was investigated by the Environmental Protection Agency’s Criminal Investigation Division, the Internal Revenue Service’s Criminal Investigation Division, and the United States Department of Agriculture’s Office of Inspector General.  The case is being prosecuted by Assistant United States Attorney John Gallagher and Trial Attorney Adam Cullman of the ENRD.

Assistant Attorney General Jeffrey Bossert Clark of the Department of Justice’s Environment and Natural Resources Division (ENRD) and United States Attorney William M. McSwain for the Eastern District of Pennsylvania announced today that a federal jury in Reading, Pennsylvania, convicted David M. Dunham Jr. of the following crimes: conspiracy to commit wire fraud and defraud the United States; wire fraud; filing false tax documents; and obstruction of justice.  The conviction stemmed from Dunham hatching and executing a scheme to defraud the Environmental Protection Agency, the Internal Revenue Service, and his customers to obtain renewable fuel credits in his “green energy” business.  The government is also seeking forfeiture of approximately $1.7 million in fraudulently obtained revenue and several parcels of real estate.  The trial lasted four weeks before United States District Judge Jeffrey L. Schmehl.  

In Dunham’s green energy scam, he fraudulently applied for, received, and sold “credits” for selling renewable biofuels that he, in fact, did not sell and, in many instances, had never possessed in the first place.  He obtained these credits from government agencies, which resulted in Dunham obtaining $50 million in fraudulent revenue.  Dunham ran the scam from approximately 2010 to 2015, using his business, Smarter Fuels, and that of his co-defendant, Ralph Tomasso, who previously pleaded guilty to conspiracy to defraud federal programs.

“Today’s conviction sends a clear message to any future fraudsters out there: crime does not pay.  Especially when that crime involves defrauding American customers and multiple federal agencies,” said Assistant Attorney General Clark. “When the defendant knowingly cheated a federal government program aimed at energy conservation, he gave himself an unfair advantage over his competitors and stole millions of dollars from the American taxpayer in the process.  The Department of Justice will not tolerate this type of deception and will continue to work with its law enforcement partners to root out this unlawful conduct.”

“Though this defendant tried to deflect blame on others, his years of scamming the government and his customers has finally caught up to him,” said U.S. Attorney McSwain.  “And the truth is as simple as this: Everyone has to follow the rules.  You cannot lie, steal, or cover up your misdeeds.  If you do, we will hold you accountable.  Experience shows that fraudsters like Dunham are always looking for the next best scam.  As American consumers become increasingly more concerned with energy conservation, green energy scams like the one in this case provide criminals with an easy angle.  We are grateful that the jury saw through Dunham’s lies and reached the correct result.”

“David Dunham created an elaborate scheme that served no purpose other than to mislead and defraud the government,” said IRS Special Agent in Charge Guy Ficco.  “Unfortunately for him, our special agents were able to track the movement of paperwork and uncover the deceit behind his actions.  We, along with our fellow law enforcement partners and the Department of Justice, will continue to investigate and prosecute those who commit similar crimes.”

“The defendant made numerous fraudulent claims to illegally profit from the Renewable Fuel Standard (RFS) Program,” said Director Jessica Taylor, Director of EPA’s Criminal Investigation Division.  “Today’s conviction should send a clear signal that EPA and our law enforcement partners are committed to protecting the integrity of the Energy Independence and Security Act of 2007.”

“We appreciate the commitment of the Department of Justice and the cooperative efforts of our law enforcement partners throughout this significant investigation,” said USDA-OIG Special Agent-in-Charge Bethanne M. Dinkins.  “Mr. Dunham’s conviction at trial sends a strong message regarding the benefit of working across agency lines to protect the integrity of Government programs like the USDA Advanced Biofuel Payment Program, established in the 2008 Farm Bill as an incentive for companies to produce and use alternative fuel sources.  The USDA Office of Inspector General will continue to dedicate resources to protect the Department’s programs and assets by investigating those who commit fraud and compromise the integrity of USDA programs.”

The case was investigated by the Environmental Protection Agency’s Criminal Investigation Division, the Internal Revenue Service’s Criminal Investigation Division, and the United States Department of Agriculture’s Office of Inspector General.  The case is being prosecuted by Trial Attorney Adam Cullman of the Environmental Crimes Section and Assistant United States Attorney John Gallagher.

PHILADELPHIA – Deputy U.S. Attorney Louis D. Lappen announced that the political consultant to then-Allentown Mayor Edwin Pawlowski, Michael Fleck, 40, formerly of Allentown, PA was sentenced today to five years in prison followed by three years of supervised release by Chief U.S. District Court Judge Juan R. Sanchez. Fleck must also pay $134,487 in restitution. The defendant was immediately remanded to federal custody to begin serving his sentence. Fleck previously pleaded guilty to one count of conspiracy to commit extortion and bribery offenses and one count of tax evasion.

 Fleck was a principal and co-owner of an Allentown-based consulting company that conducted fundraising and other campaign-related services for certain elected officials in Pennsylvania (“the political clients”), and lobbied these same political clients on behalf of individuals and companies who sought contracts and other favorable treatment from local governments (“the business clients”).

Mayor Vaughn Spencer of Reading, Mayor Edwin Pawlowski and Controller Mary Ellen Koval of Allentown were each elected officials in their respective cities as well as Fleck’s political clients. Spencer and Koval sought re-election to the offices they held, while Pawlowski aspired to win higher office through statewide election.  Each of these three elected officials attempted to leverage their respective public offices – which gave them actual and perceived authority over the awarding of municipal contracts – for items of value, including campaign contributions.

As part of the “consulting” services that Fleck provided, he helped facilitate quid pro quo solicitations, offers and agreements, and obtained tens of thousands of dollars in campaign contributions from businesses and donors seeking to do business with the City of Allentown and the City of Reading for his political clients.

Fleck also filed fraudulent income tax returns for tax years 2011, 2012 and 2013, in which he concealed income from his consulting company of approximately $130,897.41, overstated certain deductions, and failed to remit approximately $43,467 in payroll taxes, causing a tax loss of approximately $77,738.

“Fleck manipulated our democratic systems of government to enrich himself and his associates at the expense of the citizens of Reading and Allentown,” said Deputy U.S. Attorney Lappen.  “In doing so, Fleck and the corrupt mayors with whom he conspired did tremendous damage to the confidence that our citizens have in their local governments. Our Office remains committed to uncovering and prosecuting public corruption at all levels. Public officials and their cronies should start getting the message that they must serve the public rather than satisfy themselves and their venal desires.”

“Compliance with the tax laws in the United States relies heavily on self-assessments of taxes owed,” said IRS Criminal Investigation Special Agent in Charge Guy Ficco. “Michael Fleck took steps to prevent the assessment of his true tax liability; and the sentence he received shows how seriously the courts take federal tax crimes like this.”

The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service and is being prosecuted by Assistant United States Attorneys Michelle Morgan and Anthony Wzorek.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Peter Goodchild, 56, of Philadelphia, PA, was convicted today at trial on charges of embezzling almost $1.6 million from his former employer, QwikSource, over a ten-year period beginning in 2005 and ending in 2015 through a wire fraud scheme.  Goodchild was also convicted of money laundering, aggravated identity theft, and filing false income tax returns during this period.

Goodchild, former bookkeeper for QwikSource LLC/GMI Technical Sales LLC of Florham Park, NJ, opened a PayPal account using his employer’s name, transferred funds from QwikSource’s bank account to that PayPal account, from that PayPal account to another PayPal account belonging to his girlfriend, and from his girlfriend’s PayPal account to one or more of his personal bank accounts.  The defendant further concealed the embezzlement by making financial entries on files he maintained for QwikSource that increased the cost of goods sold by the same amount of the money he wired from QwikSource’s account to the PayPal accounts and his personal bank accounts. 

Further, Goodchild failed to pay taxes on his wealth.  Between 2010 and 2015, he embezzled at least $854,800 and had unreported income of $231,100 in 2010, $215,100 in 2011, $83,600 in 2012, $125,000 in 2013, $152,000 in 2014, and $48,000 in 2015.  His actions created a tax loss of approximately $240,648. 

Goodchild was charged with and convicted on 48 counts of wire fraud, 10 counts of money laundering, six counts of filing a false income tax return, and one count of aggravated identity theft.  Wire fraud and money laundering are punishable by up to 20 years in prison.  Filing a false tax return is punishable by up to three years.  Aggravated identity theft is punishable by a mandatory two years of prison that must follow any term imposed on the other counts.  Additionally, Goodchild will be subject to restitution and/or forfeiture of money and substitute assets totaling $1,589,315. 

“My office takes offenses like embezzlement, tax fraud and money laundering very seriously,” said U.S. Attorney McSwain. “The defendant stole more than a million dollars by abusing his position handling finances for 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.”

“The role of IRS Criminal Investigation becomes even more important in embezzlement and fraud cases due to the complex financial transactions that can take time to unravel,” said Guy Ficco, Special Agent in Charge. “As we often see, federal tax laws are normally violated in these types of cases and IRS CI is committed to ensuring that everyone pays their fair share.”

The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service and is being prosecuted by Assistant United States Attorney Anita Eve.

PHILADELPHIA - James Strohm, 47, a Philadelphia police officer and resident of Philadelphia, was charged today by Complaint and Warrant with distribution and attempted distribution of child pornography, announced United States Attorney William M. McSwain.  If convicted of this offense the defendant faces a mandatory minimum sentence of 5 years’ incarceration.

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

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

PHILADELPHIA – First Assistant U.S. Attorney Jennifer Williams announced that former Mayor of Reading, Vaughn Spencer, 71, of Reading, Pennsylvania, was sentenced today to 96 months in prison, followed by three years of supervised release and a $35,000 fine by the Honorable Juan R. Sanchez, Chief Judge, United States District Court.

Spencer was the Mayor of Reading from January 2012 until January 2016. He was convicted by a jury on August 31, 2018 on eleven counts of bribery solicitation and related offenses, stemming from a conspiracy to solicit campaign contributions from specific vendors for the May 2015 democratic primary in exchange for lucrative municipal engineering contracts.  T&M Associates and McTish Kunkle & Associates were among the engineering firms that engaged in this pay-to-play scheme. 

Spencer, his Special Assistant, Eron Lloyd, and his campaign manager, Michael Fleck, also conspired to pay an $1,800 bribe to Reading School Board President Rebecca Acosta, who was running for district justice at the time, in exchange for her help and her husband, City Council President Francisco Acosta, in persuading Reading City Council to repeal a local ordinance that set an annual limit on individual campaign contributions to persons running for city office.  Spencer pursued this because he was hoping to maximize his campaign contributions, and keep contributions he had already received well in excess of the limit. 

Francisco Acosta pled guilty and was sentenced to, and has already served, 24 months in prison, and Rebecca Acosta pled guilty and is currently serving an 18-month sentence of incarceration. Lloyd pled guilty and was sentenced to 5 years’ probation with the first 6 months on house arrest, and Mark Neisser of T&M pled guilty and was sentenced to 5 years’ probation with the first 12 months on house arrest and a $25,000 fine.  Fleck and Matthew McTish are scheduled to be sentenced on April 26, 2019.

“Spencer was so concerned with keeping his job, and the money to run a re-election campaign, that he forgot to do his job on behalf of the citizens of Reading,” said First Assistant U.S. Attorney Williams.  “He used the position that voters had entrusted to him for his personal benefit.  Our office is committed to uncovering and prosecuting public corruption, so officials should be on notice: if you abuse the powers of your office, the federal government is coming for you.”

“While mayor of Reading, Vaughan Spencer repeatedly sold off city contracts in an effort to cling to office,” said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. “Instead of working honestly on behalf of his constituents, he embraced these corrupt relationships and transactions for his own selfish benefit. The FBI is determined to root out the kickback culture seen all too frequently in this country's halls of power.”

“Spencer’s conscious decision to deceive and benefit personally at the expense of the citizens of Reading has cost him his liberty,” said Guy Ficco, IRS Criminal Investigation Special Agent in Charge. “Let his sentence serve as a stark reminder that if you commit a crime, status as a political leader will not protect you from federal prosecution.”

The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service, and is being prosecuted by Assistant United States Attorneys Michelle L. Morgan and Anthony J. Wzorek.

PHILADELPHIA, PA – United States Attorney William M. McSwain announced that the Eastern District of Pennsylvania and the Justice Department’s Civil Rights Division hosted a roundtable today for community organizations, treatment centers, and healthcare providers in order to foster discussion about the nationwide opioid crisis.  More specifically, the roundtable focused on the protections afforded by the Americans with Disabilities Act (ADA) for individuals using medication-assisted treatment (MAT) as a means to combat their opioid addiction and promote long-term recovery.

Today’s roundtable was part of the Department of Justice’s initiative to remove discriminatory barriers to MAT and to educate local stakeholders about how anti-discrimination laws protect people with opioid use and other substance use disorders.  Representatives of dozens of local healthcare groups attended the roundtable event.  U.S. Attorney McSwain invited these representatives because they often work with individuals who are addicted to opioids and using MAT as part of their treatment. 

U.S. Attorney McSwain, Assistant U.S. Attorney Jacqueline C. Romero, the Civil Rights Coordinator for the Eastern District of Pennsylvania, and Charlotte Lanvers, an attorney with the U.S. Department of Justice’s Civil Rights Division in Washington, D.C., presented to the group and addressed ways in which the ADA can protect individuals from discrimination arising from their use of MAT.

“Locally and nationally, opioid addiction and illegal distribution of opioids continue to be at alarming levels.  My Office is committed to stopping criminals from flooding our streets with these deadly drugs, as well as enforcing the ADA’s anti-discrimination protections against those who are lawfully using MAT as part of their addiction recovery plan,” said U.S. Attorney McSwain.  “These two goals are compatible and, in fact, help to reinforce each other.”

People who believe they are being discriminated against with regard to their use of MAT should file complaints with DOJ at https://www.ada.gov/filing_complaint.htm.  Individuals who believe they may have been victims of discrimination may also file a complaint with the U.S. Attorney’s Office at 615 Chestnut Street, Suite 1250, Philadelphia, PA 19106, ATTN: Jacqueline C. Romero, Civil Rights Coordinator.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Suudimon Washington, 32, of Harrisburg, Pennsylvania was charged by information today with one count of carjacking.  The information charges Washington for taking of a vehicle from a person in Lancaster at knifepoint on October 12, 2018.

If convicted, the defendant faces a maximum penalty of 15 years’ imprisonment, and up to three years of supervised release.  Additionally, Washington faces a possible $250,000 fine and a $100 special assessment.

“When charges are brought against a suspect in a high-profile, violent crime such as the one this defendant allegedly committed, it brings relief to a community on-edge with concern for the safety of their loved ones,” said U.S. Attorney McSwain.  “The 85-year-old victim here was terrified.  I want to thank our investigating partners at the federal and local level who did such tremendous work to allow our office to file these charges.”

“Violent crime can have such a chilling effect on a community,” said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. “No one, let alone elderly folks, should have to worry about being victimized by an armed robber or carjacker. The FBI and our law enforcement partners will continue to investigate and lock up violent criminals who prey on others without compunction.”  

The case is being investigated by the Federal Bureau of Investigation, the Lancaster City Bureau of Police, and the Philadelphia Police Department, and it is being prosecuted by Assistant United States Attorney Robert E. Eckert.

An Information is an accusation.  A defendant is presumed innocent unless and until proven guilty.

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that Tooles Contracting Group, LLC, of Detroit, Michigan, Commercial Contracting Corporation (CCC) of Auburn Hills, Michigan, G&B Electric, Inc., and G&B Electric’s President, James Gierlach, both of Ferndale, Michigan, have agreed to pay the United States $466,500 to resolve allegations that Gierlach, G&B Electric, and Tooles engaged in bid rigging and inflating invoices submitted to the National Railroad Passenger Corporation (Amtrak) as part of contracting work performed to increase the accessibility of Amtrak stations in Hammond, Louisiana, Beaumont, Texas, Alpine, Texas, and Little Rock, Arkansas. CCC, as the minority owner of Tooles, also contributed to the settlement.

Based on its investigation, the United States contends that Gierlach and a Tooles employee engaged in bid rigging when the Tooles employee shared a bid for the electrical work on the Beaumont, Texas, station with Gierlach. As part of this scheme, Gierlach paid cash to the Tooles employee in exchange for this information.

The United States also contends that Gierlach and G&B Electric submitted false invoices for their work at other Amtrak locations. First, in November 2010, at Tooles’ urging, Gierlach submitted an invoice for $28,440 in excess of the work that had been completed at the time. Second, Tooles and G&B Electric caused false claims related to carpenters to be submitted to Amtrak. Tooles requested that Gierlach place certain carpenters as subcontractors to G&B Electric and submit a change order for $115,000 to cover the cost of the carpenters. The true cost of this work was approximately half of that amount and G&B Electric and Tooles agreed that G&B Electric could keep the difference in exchange for future renovations of Tooles’ office building. Tooles approved the overinflated invoices that comprised the change order, which was then paid by CCC. All Amtrak contracts pass through Amtrak’s Philadelphia procurement office.

“Government contractors must be honest in their bidding and in their billing,” said U.S. Attorney McSwain. “Bid rigging damages both the government and the market by rewarding corruption. This settlement reflects the seriousness with which my Office takes these allegations and the lengths we will go to investigate false claims submitted by contractors that are the result of an unfair bidding process.”

“We’re proud of the tenacity displayed by our investigative staff and the U.S. Attorney’s office, a team effort that helped bring this complex case to its resolution,” said Kevin Winters, Amtrak’s Inspector General. “This work underscores the importance of our mission and our commitment to detecting and preventing fraud, waste, and abuse.”

The case was handled by Assistant United States Attorney Paul J. Koob. The case was investigated by the Amtrak Office of Inspector General.

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that Thomas Jefferson University Hospitals, Inc., and Outpatient Imaging Affiliates, LLC, collectively the owners and operators of Jefferson Outpatient Imaging and Radiology (“Jefferson Outpatient”), have entered into a settlement agreement with the United States to resolve allegations that Jefferson Outpatient violated the Americans with Disabilities Act (ADA) by denying full and equal access to Jefferson Outpatient services based on an individual’s disability and use of a wheelchair. 

Under the ADA, facilities like Jefferson Outpatient, as a place of public accommodation, must provide outpatient and radiology services to members of the general public.  This settlement arises out of an investigation into whether Jefferson Outpatient failed to provide access to dual energy x-ray absorptiometry (DEXA) bone density scans to individuals with disabilities at its facilities in the greater Philadelphia area, which is in violation of the ADA.

“This investigation and resolution illustrate that individuals with disabilities still face discrimination and obstacles when they seek access to healthcare,” said U.S. Attorney McSwain.  “All individuals should have equal access to these services and the protections that the ADA affords to them.”  U.S. Attorney McSwain added that “Jefferson Outpatient cooperated with the investigation, recognized the importance of providing access to all, and acted swiftly to put compliance measures in place once the issue was brought to their attention.” 

To resolve the matter, Jefferson Outpatient has agreed to comply with its obligations under the ADA, pay compensatory damages to the complainant, and within 30 days, will adopt and incorporate a Non-Discrimination Policy into its existing policies and post it in conspicuous locations in all of its offices.  Jefferson Outpatient will also post and maintain a hyperlink to the Non-Discrimination Policy on the home page of its website.  In addition, Jefferson Outpatient will train all staff who interact with patients on the requirements of the ADA as they apply to healthcare facilities and on techniques for safely assisting individuals with mobility disabilities to transfer to imaging equipment or examination tables.  Further, Jefferson Outpatient will incorporate the above training into its new employee orientation for all future employees who will have contact with patients. 

The U.S. Attorney’s Office for the Eastern District of Pennsylvania is committed to investigating alleged violations of the ADA.  Those interested in learning more about obligations under the ADA may access www.ada.gov, or call the Department of Justice’s toll-free information line at (800) 514-0301 or (800) 514-0383 (TDD).  Information about filing a complaint, including instructions for filing a complaint online, can be found at https://www.justice.gov/crt/how-file-complaint.

Assistant U.S. Attorney Deborah W. Frey handled the matter in conjunction with Alyse Bass, Senior Trial Attorney, at the Department of Justice’s Civil Rights Division. 

PHILADELPHIA – United States Attorney William M. McSwain announced today that two individuals from the Eastern District of Pennsylvania have been charged in connection with two nationwide health care fraud takedowns.  These two cases stem from the partnership between the United States Attorney’s Office for the Eastern District of Pennsylvania and the recently formed Newark/Philadelphia Regional Medicare Fraud Strike Force, which is staffed with prosecutors from the Health Care Fraud Unit in the Fraud Section of the Justice Department’s Criminal Division. 

Federal prosecutors unsealed charges today against over 50 medical professionals in the Appalachian Regional Prescription Opioid (“ARPO”) Surge Takedown.  Those professionals were responsible for more than 30 million illegally prescribed opioids given to nearly 30,000 patients.  United States Department of Justice officials announced these charges today.  Additionally, on April 9, Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division announced a national telemedicine takedown, with 24 defendants charged in a $1.2 billion dollar fraud scheme involving international call centers, telemedicine companies, licensed medical professionals, and durable medical equipment (“DME”) companies. 

The two Eastern District of Pennsylvania cases involved in these takedowns are summarized below.

In United States v. Tayjha Brown, the defendant, 34, of Coastesville, Pennsylvania was a former licensed practical nurse who was charged by information in connection with the ARPO Surge Takedown with one count of conspiracy to distribute controlled substances.  The charges stem from Brown’s role in filling fraudulent prescriptions in her name and in the names of others at a local pharmacy in order to obtain oxycodone for herself and to distribute.  Brown forged the prescriptions primarily from prescription pads and paper she stole from her employers.  The defendant provided approximately 30 oxycodone pills from each fraudulent prescription not written in her name to her co-conspirators. 

In United States v. Randy Lee Swackhammer, the defendant, 60, of Goldsboro, North Carolina was a medical doctor licensed in four states who was charged by information with one count of conspiracy to commit health care fraud.  The charges stem from Swackhammer’s role in the telemedicine fraud scheme in which he conspired with telemedicine companies to prescribe medically unnecessary orthotic braces to unsuspecting Medicare beneficiaries following brief phone calls.  The referrals caused the submission of approximately $5 million in false and fraudulent claims to the Medicare program.  Swackhammer neither conducted in-person examinations nor meaningful telephonic evaluations prior to prescribing at least one, and often multiple, orthotic braces. 

“The Newark/Philadelphia Regional Medicare Fraud Strike Force is producing results for the people and businesses who are hurt by this type of crime and for all taxpayers who support government programs like Medicare,” said U.S. Attorney McSwain.  “These two cases exemplify the great work being done to root out fraud, waste and corruption.”

“Whether it’s the unlawful diversion of Medicare funds or prescription drugs, the FBI will continue to crack down on all manner of health care fraud,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “Medical professionals who choose to engage in these crimes should know that the next knock at your door could very well be Special Agents with a search warrant.”

The Brown case was investigated by the Office of Personnel Management-Office of Inspector General, Federal Bureau of Investigation, Department of Health and Human Services-Office of Inspector General, Drug Enforcement Administration and United States Marshals Service.  The case is being handled by Assistant United States Attorney Paul J. Koob and DOJ Trial Attorney Adam G. Yoffie, who is one of two prosecutors assigned to the Eastern District of Pennsylvania from the Health Care Fraud Unit in the U.S. Justice Department’s Criminal Division’s Fraud Section.

The Swackhammer case was investigated by the Federal Bureau of Investigation, Department of Health and Human Services-Office of Inspector General, Internal Revenue Service, United States Postal Inspection Service, and auditor Dawn Wiggins.  The case is being handled by DOJ Trial Attorney Adam G. Yoffie.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that James Williams, 32, of Philadelphia, PA was convicted today at trial of distribution of heroin, possession with intent to distribute heroin and crack cocaine, and illegal possession of a firearm by a felon.

The defendant and his co-defendant, “A.J.,” became romantically involved in April 2017, after which the defendant began to supply A.J. with heroin to sell to her regular customers located in Bristol, PA.  The defendant and A.J. shared the proceeds.  Williams also sold narcotics to other customers outside of his relationship with A.J.

On July 18, 2017 A.J. arranged to meet a man, who was actually a confidential informant (“CI”) working with the Bensalem Township Police Department, in a shopping center in Bensalem, PA to sell him heroin and crack cocaine.  A.J. and the defendant arrived together in the defendant’s Ford Mustang, and the CI got into the back seat of the defendant’s car to purchase the narcotics.  The defendant and A.J. were immediately arrested.   Bensalem Township Police officers then found a loaded firearm and more narcotics locked in the glovebox, and more narcotics hidden in the trunk of the defendant’s car.  Williams had a prior felony conviction which prohibited him from legally possessing a firearm.

“Drug distribution and gun violence are an epidemic in Philadelphia and the federal government is aggressively prosecuting both and getting dangerous criminals off the streets,” said U.S. Attorney McSwain. “We want to thank our law enforcement partners in this case, ATF and the Bensalem Township Police Department, for their hard work and dedication.”

“There is no place in our community for those who use firearms for violent, criminal purposes,” said Donald Robinson, Special Agent in Charge of ATF’s Philadelphia Field Division. “ATF will continue to work with our law enforcement partners at the federal, state, and local levels to ensure those individuals are brought to justice.”

The case was investigated by Bensalem Township Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”) and is being prosecuted by Assistant United States Attorneys Timothy Stengel and Eric Henson.

PHILADELPHIA – U.S. Attorney William M. McSwain announced today that Renard Gray, of Philadelphia, was sentenced to 87 months in federal prison by United States District Judge Petrese B. Tucker for his participation in a criminal conspiracy to traffic firearms into the Philadelphia region.

Over the course of several months in 2017, Gray and his coconspirators illegally obtained straw-purchased and stolen firearms from Georgia and other states, which they then shipped to Philadelphia and sold in black market transactions in the city. In late 2017, an undercover officer infiltrated the trafficking ring and secretly recorded a number of gun transactions conducted by Gray and his coconspirators.  During two of these transactions, Gray also sold quantities of cocaine to the undercover officer.

During one conversation recorded by the undercover officer, Gray boasted about the sophistication of his gun trafficking operation and predicted that law enforcement would never “track [the guns] back to me.” This prediction proved false on March 13, 2018, when a federal grand jury indicted Gray and two of his coconspirators on charges related to conspiracy, gun trafficking, illegally transporting firearms, and distributing cocaine.  Gray plead guilty to all counts on May 31, 2018. 

“Gun violence in the City of Philadelphia is a scourge on our city, one which is enabled by the illegal trafficking of firearms and black market sales to individuals who should not have access to them,” said U.S. Attorney McSwain.  “Criminals like defendant Gray should be on notice that federal law enforcement will track these back to you, and we will prosecute you to the fullest extent the law allows.  We thank our federal and local law enforcement partners for their work in this investigation.”

“The primary goal of ATF’s firearms trafficking strategy is to prevent violent crime by disrupting and dismantling the firearms trafficking organizations and networks responsible for supplying violent offenders with crime guns,” said Donald Robinson, Special Agent in Charge of the Philadelphia Field Division of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).  “Ensuring that firearms traffickers are aggressively investigated and swiftly brought to justice is a top priority for the Philadelphia Field Division.”

The case was investigated by the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), with assistance from the Philadelphia Police Department, and was prosecuted by Assistant United States Attorney Sean P. McDonnell.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Dkyle Jamal Bridges, Kristian Jones, and Anthony Jones were convicted of sex trafficking of minors and sex trafficking by force, fraud, and coercion, as well as conspiracy to engage in sex trafficking following a three-week trial.

From 2012 through September 2017, Bridges led a prostitution enterprise in which various women and girls performed commercial sex acts in southeastern Pennsylvania, Delaware, Maryland, and elsewhere for Bridges’ financial benefit. Bridges frequently used violence and threats to cause the female victims to engage in the commercial sex acts.  Kristian and Anthony Jones, among others, assisted Bridges in various capacities in running the business, including by recruiting and transporting victims, collecting money, and paying for hotel rooms. 

In November 2016, a Tinicum Township police officer stopped a vehicle that had recently left a hotel known to be frequented by individuals engaged in prostitution. The driver admitted to the officer that he had just met a prostitute at the hotel and had arranged the “date” through a website called Backpage.com. Law enforcement went to the room that the customer had visited, and discovered Kristian Jones, two minor girls, condoms, and cell phones containing communications with Bridges about the prostitution business.  The room had been rented by Anthony Jones.  

That same month, a Newark, Delaware police officer, acting in an undercover capacity, responded to a Backpage.com ad offering commercial sex. When law enforcement arrived at the hotel for the “date,” they found a woman and a girl. In July 2017, the Philadelphia Police conducted a similar undercover operation, and when they arrived for the “date,” they found two adult women in the hotel room and Bridges waiting in his car.  All of the victims were fraudulently promised payment by Bridges and once enlisted in his trafficking circle, they were subjected to Bridges’ violent acts or feared him based on observing his violence against others.  Thus, all were trafficked by force, fraud, and coercion. 

“Bridges’ years of trafficking women and girls by force and manipulation, and with the willing assistance of others, are over,” said U.S. Attorney McSwain.  “Sex trafficking is a pervasive problem that demands an aggressive response. We stand ready with our federal partners to identify and dismantle organizations that perpetuate this abuse.”

“That these men felt they had the right to sexually exploit girls and women for money is abhorrent,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “The FBI and our law enforcement partners are working every day to put people like this behind bars and ensure some justice for their victims. We would ask anyone with knowledge of child or adult sex trafficking to let us know about it – anonymously, if need be. Call 1-800-CALL-FBI or go online to tips.fbi.gov.” 

The case was investigated by FBI Philadelphia with assistance from the Tinicum Township Police Department; Newark, Delaware Police Department; Delaware State Police; and Philadelphia Police Department and was prosecuted by Assistant United States Attorney Priya DeSouza and Department of Justice Trial Attorney Jessica Urban.

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

PHILADELPHIA – First Assistant U.S. Attorney Jennifer Arbittier Williams announced that Michael Bonds, 60 of Milwaukee, Wisconsin, was charged today by Information with conspiracy to commit honest services wire fraud and a violation of the Travel Act arising from his participation in a bribery scheme whereby Bonds, acting in his capacity as President of the Milwaukee Public School (“MPS”) Board, accepted payments and things of value in exchange for official acts taken to benefit a Philadelphia-based, privately-operated education and development company (“Company 1”) and its senior executives.

Company 1 was an umbrella organization for several business entities that perform services related to education management, charter school operations and neighborhood development.  Between 2012 and 2017, Company 1’s education component maintained management agreements with multiple schools operating in Philadelphia, Pennsylvania and Milwaukee, Wisconsin to manage the schools’ leadership teams, create the schools’ budgets and administer their payroll processes, and ensure that their financial reporting complied with various government entities.  The main function of Company 1’s real estate development component was to redevelop residential properties into affordable housing in South Philadelphia neighborhoods. 

Executive 1 was a Philadelphia-based founding member of Company 1 who served as the President and Chief Executive Officer since the organization's inception.  Executive 2 was Company 1’s Philadelphia-based Chief Financial Officer.  In that capacity, Executive 2 was responsible for Company 1’s overall financial and contract management.

The Information charges that Bonds engaged in a bribery scheme in which he received a series of payments and things of value from Executive 1, Executive 2, and Company 1 in exchange for a series of official acts that Bonds took on behalf of Executive 1, Executive 2, and Company 1.

The Information further charges that the conspirators disguised the bribes as payments for book sales from a company created by Bonds called “African American Books and Gifts.”  According to the Information, the conspirators created fake documents disguising the bribery payments, including sham invoices and false entries in books, records, and tax returns.  According to the Information, the conspirators also used a private commercial interstate carrier to transport bribe payments in the form of checks disguised as payments to “African American Books and Gifts,” and concealed from the MPS Board the payments Bonds received from Executive 1, Executive 2, and Company 1.  

According to the Information, on December 9, 2014, Bonds appeared at a subcommittee meeting of the MPS Board and personally advocated in support of an expansion to include the opening of an additional campus by the charter school subsidiary of Company 1 in Milwaukee, Wisconsin.  Bonds is then alleged to have brought a motion before an MPS Board subcommittee supporting a lease to house the additional campus, to have presided over the full MPS Board meeting at which the expansion was approved, and to have motioned the Board for approval of new lease terms favorable to Executive 1, Executive 2, and Company 1, which deferred lease payments of approximately $1,000,000 owed by the charter school subsidiary of Company 1.  

“Public officials, including those like Michael Bonds who were elected by voters to manage public schools, have a duty to provide honest services to their constituents,” said First Assistant U.S. Attorney Williams. “In this case, some of those constituents are school children who have no choice but to depend on adults to make decisions in their best interest, which makes Bonds’ alleged actions even more egregious. Public officials cannot be allowed to use their positions and influence to enrich themselves.”

“Today’s indictment alleges that Mr. Bonds abused his positions of trust for person gain. That is  unacceptable,” said Geoffrey Wood, Special Agent in Charge of the U.S. Department of Education Office of Inspector General’s Eastern Regional Office.  “OIG Special Agents will continue to investigate allegations of fraud and pursue those who seek to enrich themselves at the expense of our nation’s students. America’s students, their families, and taxpayers deserve nothing less.”

“Rooting out public corruption remains one of IRS Criminal Investigation's highest priorities,” said Guy Ficco, IRS-CI Special Agent in Charge. “We, along with our law enforcement partners, will continue to be relentless in our mission to enforce the law and ensure public trust.”

"When an individual elected to work on local schools' and students' behalf is more focused on their own enrichment, they've failed their constituents and community," said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. "The lesson here: the FBI will continue to investigate corruption wherever we find it and bring those responsible to justice."

If convicted, Bonds faces a maximum possible sentence of ten years’ imprisonment, a three year period of supervised release, and a $500,000 fine.  Forfeiture of $18,000 in bribery proceeds also may be ordered. 

The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigations, and the U.S. Department of Education Office of Inspector General and is being prosecuted by Assistant United States Attorneys Eric Gibson and Mark Dubnoff.

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 tax fraud conspiracy charges were filed against five former tax preparers, Florence Clark, 64, Israel Ortiz-Pena, 39, Alexander Salas, 39, Priscilla Rufino, a/k/a Priscilla Diaz, 37, and Mary Correa, 46, all residents of Philadelphia, who were owners and employees of a tax service business with numerous offices located in Philadelphia.

Each defendant is charged with conspiracy to knowingly defraud the United States by preparing and filing with the IRS false tax returns that fraudulently claimed tax refunds to which the individuals were not entitled, in violation of Title 18, United States Code, Section 371.  Salas was also charged with under-reporting his own income and, as the result, filing a false income tax return, in violation of Title 26, United States Code, Section 7206(1).   If convicted of the charges, Clark, Ortiz-Pena, Rufino, and Correa could face up to five years in prison.  Salas could face up to eight years in prison.

The charging documents filed today allege that the defendants fabricated business income for their clients, which fraudulently inflated the Earned Income Tax Credit each client could claim and thereby increased each client’s refund.  In addition, the defendants allegedly increased the preparation fees that they collected, in the form of kickbacks from the tax refunds, by fabricating business income for the clients.

 “As alleged in the indictment, these defendants – tax return preparers – committed fraud and stole from the United States government,” said U.S. Attorney McSwain.  “They also stole from the pockets of all taxpayers who do the right thing every April and pay their fair share of taxes.”

“Knowingly falsifying documents filed with the IRS is a crime,” said Guy Ficco, IRS Criminal Investigation Special Agent in Charge.  “Dishonest tax return preparers, like those charged in this conspiracy, use a variety of methods to cheat the government.  This is a reminder to take care when choosing a tax return preparer; as you, the taxpayer, are ultimately responsible for the accuracy of the information on your tax return.”

The case was investigated by the Internal Revenue Service and is being prosecuted by Assistant United States Attorney Anita Eve.

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Victor Gates, 72 of Philadelphia, PA, a retired 30-year veteran of the Philadelphia Police Department, was sentenced today to serve 40 months in prison, followed by two years’ supervised release, and to pay a $15,000 fine.  Gates was also ordered to forfeit $653,319.10 in proceeds from his crimes.  The sentence was imposed by the Honorable Wendy Beetlestone of the United States District Court for the Eastern District of Pennsylvania.

Gates was convicted at trial of one count of conspiracy to commit honest services fraud, fourteen counts of honest services mail fraud, and two counts of lying to federal investigators.  The charges arose from Gates’s orchestration of a seven-year bribery scheme during which he paid a Philadelphia Police detective for special access to law enforcement databases in order to build up Gates’ lucrative towing business.  The evidence at trial showed that Gates’s business made monthly bribe payments by check since at least May 2008.  In total, Gates paid the detective $25,200 to abuse his access to law enforcement databases.  The jury also found that during the investigation, Gates lied on two occasions to federal investigators about the corrupt arrangement.

“Through his corruption and criminality, Gates has disgraced himself, embarrassed his former colleagues, and corrupted a former police detective who viewed Gates as a mentor,” said U.S. Attorney McSwain.  “The sentence imposed today should send a message that such corruption will be vigorously prosecuted and the offenders held to account, no matter who they are or what position they hold.”   

“After 30 years on the force, Victor Gates knew well that bribing a police officer was an egregious crime,” said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division.  “Nonetheless, he stuck with his scheme, ensnaring a former colleague and ignoring all ethical boundaries in order to make a buck.  What a shame.  Know that the FBI will continue to tenaciously investigate such corruption, and bring those involved to justice.”

“While we are saddened that a former law enforcement officer has engaged in such egregious conduct, we certainly appreciate the efforts of our federal law enforcement partners in bringing Mr. Gates to justice,” said Philadelphia Police Commissioner Richard Ross.  “The investigation, arrest, and successful prosecution of Mr. Gates serves as an emphatic reminder that no one may operate outside the law, regardless of position or affiliations.”

The case was investigated by the Federal Bureau of Investigation and the Internal Affairs Division of the Philadelphia Police Department and was being prosecuted by Assistant United States Attorney Eric L. Gibson.          

PHILADELPHIA – United States Attorney William M. McSwain today announced sentences in three separate immigration cases in which the defendants, who are all convicted criminals, were also convicted for the additional crime of illegally reentering the United States after having been previously deported.  The three cases are United States v. Marcos Mendoza-Jimenez; United States v. Walter Morales-Lopez; and United States v. Melvin Ramos-Moreira.  

United States v. Marcos Mendoza-Jimenez 

Marcos Mendoza-Jimenez, 43, of West Chester, was sentenced to 24 months imprisonment, followed by immediate and permanent removal from the United States.  Mendoza-Jimenez was charged by federal indictment in October 2018 with one count of illegal reentry after deportation.  Mendoza-Jimenez, a native and citizen of Mexico, illegally entered the United States sometime before 2004.  While living here illegally, he was convicted in 2004 for theft, assault, and false imprisonment based on an altercation with a man who Mendoza-Jimenez held captive in a car for several hours and threatened with a hammer.  After his first conviction, Mendoza-Jimenez was deported and removed from the United States.  The defendant returned illegally sometime in 2016.  In 2018, he also assaulted a female with whom he was in a relationship.  

United States v. Walter Morales-Lopez 

Walter Morales-Lopez, 33, of Kennett Square, was sentenced to time served, approximately six months after pleading guilty to one count of illegal reentry after deportation.  Morales-Lopez, a native and citizen of Mexico, entered the United States illegally sometime prior to 2011, when he was removed from the United States for the first time.  At some point thereafter, the defendant illegally reentered the United States and engaged in a sexual relationship with a 15-year-old girl.  He was subsequently convicted on state charges of statutory sexual assault, corruption of minors, and luring a child into his car.  As a result of his federal conviction on the immigration crime, the defendant will be immediately transferred into the custody of Immigration and Customs Enforcement for immediate permanent removal from the United States.

United States v. Melvin Roberto Ramos-Moreira

Melvin Roberto Ramos-Moreira, 24, of Lancaster, was sentenced to 12 months and 1 day in prison after pleading guilty to one count of illegal reentry after deportation.  Ramos-Moreira, a native and citizen of Honduras, entered the United States sometime prior to 2013.  In 2013, he was found in the United States, convicted in state court for stalking, and deported for the first time.  At some point thereafter, Ramos-Moreira reentered the United States illegally.  In 2018, he was charged and pleaded guilty to state charges of stalking, possessing an instrument of crime, invasion of privacy, and harassment following an incident where he followed a female victim shopping in a store and took pictures up the victim’s skirt.

“Those who enter our country illegally are not above the law – nobody is,” said U.S. Attorney McSwain.  “These defendants decided they did not have to follow the rules. They not only flouted our nation’s immigration laws, but also committed additional serious crimes while they were here illegally.  We will continue to work with our law enforcement partners to uphold the rule of law and ensure our nation’s immigration laws are enforced.”

“All three defendants were previously removed from the United States and have been convicted of crimes: Mendoza-Jimenez for assaulting and stealing from a man whom he threatened with a hammer, Morales-Lopez for sexual assault, Ramos-Moreira for a stalking conviction,” said Simona L. Flores, Field Office Director for ICE Enforcement and Removal Operations (ERO) Philadelphia.  “ICE and the U.S. Attorney's Office for the Eastern District of Pennsylvania will seek to prosecute and remove dangerous criminals who break United States law. Our officers continue to work daily with professionalism and integrity, enforcing the law as set forth by Congress.”

These cases were investigated by ICE’s Enforcement and Removal Operations and are being prosecuted by Assistant United States Attorneys Mary Kay Costello, Mary E. Crawley, and Nancy Beam Winter.

 

PHILADELPHIA – United States Attorney William M. McSwain announced today that his office has filed a civil lawsuit to enjoin Miller’s Organic Farm of Bird-in-Hand, Pennsylvania, and its owner, Amos Miller, from continuing to violate federal food safety laws.  The violations include Miller’s selling non-federally-inspected, misbranded meat and poultry products to consumers located throughout the United States.

The United States brings the action on behalf of the Food Safety and Inspection Service (FSIS) of the U.S. Department of Agriculture.  FSIS is responsible for ensuring that commercially sold meat, poultry, and egg products are safe, wholesome, and correctly labeled and packaged.  A principal way that FSIS fulfills its mission is by inspecting meat and poultry products before they reach consumers.

The suit is part of the United States’ continuing efforts to bring Miller’s into compliance with federal food safety laws. In late 2015, for example, the Food and Drug Administration, which regulates milk: (1) isolated and identified Listeria monocytogenes (L. mono) bacteria in samples of Miller’s raw milk; (2) through whole genome sequencing, found the bacteria to be genetically similar to L. mono in two individuals who had developed listeriosis (with one dying) after consuming raw milk; and (3) named Miller’s as the “likely source” of those infections.  

In follow-up, FSIS sought to assess whether L. mono might be contaminating Miller’s meat and poultry products.  But Mr. Miller refused to grant FSIS entry to the farm’s meat-and-poultry-related facilities, even after the agency served him with a subpoena.  He erroneously contended that, as a self-organized private membership association, Miller’s is beyond the reach of federal food safety regulation.

The United States then sued Miller’s in the Eastern District of Pennsylvania, to enforce the subpoena and USDA’s access rights under the Federal Meat Inspection Act (FMIA) and the Poultry Products Inspection Act (PPIA).  See United States v. Miller’s Organic Farm and Amos Miller, EDPA No. 16-cv-2731.  After the court enforced the subpoena, FSIS cited Miller’s with FMIA and PPIA misbranding and other violations, which have since continued.  This is believed to be the first-ever suit of its kind where FSIS is seeking an injunction against a so-called “private membership association” farm business to enforce food safety laws.

“With today’s lawsuit, food establishments in this District are on further notice that my Office will not ignore efforts to evade federal food safety laws and to hinder agencies like FSIS from carrying out their public safety missions,” said U.S. Attorney McSwain.  “We will not allow commercial sellers to ignore the rule of law, make up their own sets of rules, and attempt to hide behind a private-membership-association structure in an effort to thwart federal laws.  Congress enacted food safety laws to ensure that the nation’s food supply is safe, wholesome, and properly labeled and packaged.  It’s our job to enforce those democratically enacted laws, which we will do in this case.”

“FSIS investigators work hard every day to protect consumers,” said Carmen Rottenberg, FSIS Administrator.  “We take our job to protect public health very seriously, with swift action to ensure that American families have safe food to eat. Flagrant failure to meet the regulations will not be tolerated.”

Assistant United States Attorney Gerald Sullivan is litigating this case on behalf of the United States.

PHILADELPHIA – United States Attorney William M. McSwain announced today that Jerome Lamont Duggan, 46, of Bethlehem, Pennsylvania, was convicted at trial of one count of conspiracy to distribute 500 grams or more of methamphetamine; one count of possession with intent to distribute 50 grams or more of methamphetamine; one count of possession with intent to distribute 500 grams or more of cocaine; one count of possession with intent to distribute 28 grams or more of cocaine base (“crack”); and one count of possession with intent to distribute marijuana.  Sentencing will be held before United States District Judge Joseph F. Leeson, Jr.

During an investigation into the drug trafficking activities of Larry Roger Beitler, Jr. (charged elsewhere), law enforcement determined through wiretap interceptions that Beitler had purchased quantities of methamphetamine from the defendant.  Further evidence, including additional wiretapped phone calls, intercepted postal packages, and surveillance, established that Duggan was an active drug trafficker between March 2016 and May 5, 2016, and further established the location of his stash house of drugs.

“The Lehigh Valley is safer now that this defendant has been brought to justice.  Stopping the trafficking of deadly drugs is a top priority of my Office and of the Department of Justice, and successful prosecutions of cases like this remain a key part of our deterrence strategy,” said U.S. Attorney McSwain.  “My Office remains committed to working with our law enforcement partners to find, convict, and imprison the criminals who flood our streets with poisonous drugs.”

This case was investigated by the Drug Enforcement Administration and is being prosecuted by Assistant United States Attorney Kishan Nair.

PHILADELPHIA – United States Attorney William M. McSwain announced that Carlos Ramos, 34, of Philadelphia, was convicted yesterday by a federal jury of one count of attempted possession with intent to distribute 500 grams or more of cocaine, one count of possession with intent to distribute cocaine, and one count of possession with intent to distribute cocaine within 1,000 feet of an elementary school.

On September 11, 2018, U.S. Postal Inspectors intercepted a suspicious priority mail package at the Philadelphia mail distribution center. After receiving a court-ordered search warrant, law enforcement opened the package and discovered over one kilogram of cocaine inside the package. On September 13, 2018, law enforcement conducted a controlled delivery of the priority package, which also contained a court-authorized GPS tracker and beeper device inside of it. The package was hand-delivered to the defendant, Carlos Ramos. A few minutes after delivery, the beeper went off, indicating that the priority mail package had been opened. When law enforcement knocked on the door, no one responded. A law enforcement officer conducting surveillance in the rear of the house observed an arm in a white jacket reach out of a second floor window and throw a white package out of the window into the backyard of the adjoining property. Law enforcement retrieved the package from the adjacent yard. Upon entry into the house, law enforcement encountered Ramos exiting the rear bedroom on the second floor and wearing a white jacket. A sweep of Ramos’ hands with a black light revealed the presence of theft detection powder on Ramos’ hands. Agents found the opened priority mail package, a knife, and some of the plastic wrapping material at the top of the stairs. The home is across the street from an elementary school. 

 “The defendant received over one kilogram of cocaine in the mail when he lived across the street from an elementary school,” said U.S. Attorney McSwain. “He clearly has no respect for the rule of law as well as a total disregard for the safety of our children. We are grateful that the jury held him accountable for his crimes.”

The case was investigated by the U.S. Postal Inspection Service and the Philadelphia Police Department, and the case is being prosecuted by Assistant United States Attorneys Justin Ashenfelter and Frank A. Labor III.

PHILADELPHIA – United States Attorney William M. McSwain announced that Gary Frank, age 48, of Philadelphia and Bala Cynwyd, Pennsylvania, was charged today by indictment with wire fraud, bankruptcy fraud, and money laundering, stemming from a massive fraudulent loan scheme.

According to the indictment, for over a decade, the defendant executed a complex and sophisticated scheme to defraud numerous victims. The defendant owned and operated a Bala Cynwyd business named the Legal Coverage Group, Ltd., which contracted with employers desiring to offer a legal plan to their employees as part of their employee benefits plans. It is alleged that the defendant tricked his victims into believing that the Legal Coverage Group was a rapidly growing leader in the legal plan industry, generating hundreds of millions of dollars of annual revenue and employing hundreds of individuals. In reality, however, the Legal Coverage Group experienced virtually no growth from approximately 2006 through 2017, generating only several thousand dollars of annual revenue. Through this fraud, the defendant allegedly obtained over $30 million in loans, which he used to live an extravagant lifestyle.

According to the indictment, the defendant’s largest victims were banks and financial institutions, which loaned the Legal Coverage Group millions of dollars based upon the defendant’s fraudulent misrepresentations and false documents that he created.  The defendant also allegedly deceived many individuals and other entities, including several of his close friends, his company’s staff members, its advisors, customers, vendors, and local charities.

“This Office takes allegations of financial fraud and loan fraud very seriously,’ said U.S. Attorney McSwain. “As alleged, the defendant obtained millions of dollars from lenders and friends, only to spend it on his lavish personal lifestyle. My Office will continue to work with our law enforcement partners to protect innocent individuals and businesses from being victimized by fraud.”

"This defendant allegedly lived high on the hog for over a decade by fraudulently misrepresenting his business practices and prowess," said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. "The FBI will continue to diligently investigate and hold accountable those foolish enough to engage in financial fraud."

If convicted, the defendant faces a maximum possible sentence of 935 years imprisonment, full restitution, a fine, and a period of supervised release.

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Patrick J. Murray.                                                                    

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

 

PHILADELPHIA – United States Attorney William M. McSwain announced that Nafis Mullins, 27, of Philadelphia, was convicted today by a federal jury of one count of possession of a firearm by a convicted felon.

On May 1, 2018, at approximately 11:40 pm, Philadelphia police officers were patrolling the area of 24th and Oxford Streets in Philadelphia when they encountered a group of men on Oxford Street. When the officers stopped to ask the group what they were doing, all of the men turned to acknowledge the officers, except for the defendant. Instead, the defendant kept his back to the officers with his hands in the front pouch pocket of his bright orange sweatshirt. An officer asked the defendant to turn around and take his hands out of his sweatshirt, and the defendant failed to comply and fled from the police. As he ran, the defendant threw a dark object (later determined to be a firearm) up and to the left with his left hand before jumping over a small cinderblock wall in an attempt to conceal himself. After the defendant was stopped, law enforcement recovered the loaded firearm. The defendant has several prior felony convictions which prohibit him from possessing a firearm.

“Reducing violent crime and keeping illegal guns off our streets are top priorities for the Department of Justice and my Office,” said U.S. Attorney McSwain. “The defendant, who was a convicted felon multiples times over, knew that he could not legally possess a gun, but decided the law did not apply to him. Thank you to our law enforcement partners for enforcing the law and helping keep our community safe from violence.”

“The investigation, arrest, and successful prosecution of Nafis Mullins serves as evidence of the effectiveness of strong and consistent collaboration between law enforcement agencies,” said Richard J. Ross Jr., Philadelphia Police Commissioner. “With the conviction and impending sentencing, Mullins, who is a recidivist offender, will no longer be able to re-offend in our neighborhoods. This, along with the continuing efforts of the Project Safe Neighborhoods partner agencies, will have an appreciable impact on the quality of life of the residents of our great city.”

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.

The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Philadelphia Police Department, and the case is being prosecuted by Assistant United States Attorney Katherine Driscoll.

PHILADELPHIA – United States Attorney William M. McSwain was honored to speak today at the Association of Corporate Counsel of Greater Philadelphia’s Summit for General Counsel and Chief Legal Officers.  The event was held at the Loews Philadelphia Hotel.  Richard E. Coe, U.S. Attorney McSwain’s former law partner at Drinker Biddle, introduced U.S. Attorney McSwain.

*****

Remarks as Prepared for Delivery

          Thank you, Rick, for that kind introduction, and for inviting me to speak today to this distinguished group.

          Opportunities like this serve as an important reflection point for me; they give me a reason to set aside some time, outside of the day-to-day hustle and bustle, to pause and think about the goals and priorities that I have for the U.S. Attorney’s Office and force me to evaluate our progress.

          Obviously, my main priority, and our core function, is to uphold the rule of law.  I firmly believe that building trust between the public and my Office is critical to success in that regard.  That’s one of the reasons why I think it’s important to speak at events like this – to let community partners get a sense of who we are as prosecutors; what my Office stands for; and what our mindset is as we work every day to fulfill our mission.  And by “community partners,” I am referring today to you and the companies and clients that you work for.  You and your colleagues are the business leaders that drive economic growth in the greater Philadelphia area.

            Which brings me to the topic of my remarks: fostering cooperation and communication to promote the rule of law.  I see today’s summit as an opportunity to convey two important messages.

            First, I want to thank you.  The work that you do to promote your company’s compliance with federal law is incredibly important.  In a way, you serve a crucial law enforcement function every day by working to ensure that your companies comply with the law.  You are on the front lines of promoting the rule of law in your organizations.  And in performing that function, I want you to know that you have my support and my gratitude.

            Now, admittedly, my second message will take a little longer to communicate, even though it is related to the first.  In a nutshell, I want you to know that I value communication between your organizations and my Office and I value the cooperation of your organizations with my Office.  I want you, our region’s corporate leaders, to consider yourself as a potential partner of my Office in detecting and combatting corporate misconduct and crime. 

            Let me explain that further.

           The spirit of cooperation that I’m talking about is reflected, for example, in some of the recent policy changes implemented at the Department of Justice level.  Thanks to a series of initiatives and policy adjustments, the Department is now making white collar prosecutions and enforcement more effective and efficient.   

           There’s one area in particular that I want to emphasize today – that is, recent changes to the Department’s policies concerning cooperation credit in criminal and civil matters.  Most – if not all – of you are familiar with the Yates Memo, which was issued in September 2015 by then-Deputy Attorney General Sally Yates.  Broadly speaking, the Memo was designed to seek accountability from individuals for corporate misconduct.  As Deputy Attorney General Rod Rosenstein explained when he announced changes to the Yates Memo in November 2018, the revised policy came out of a working group comprised of Department employees, law enforcement agents, and private sector stakeholders.  So the changes were the product of collaboration between government and private sector lawyers and communication about priorities, concerns, and past experiences under the Yates Memo and the policy guidance that followed. 

            The revised policies regarding cooperation credit continue to emphasize – in both criminal and civil cases – the importance of full corporate disclosure and individual accountability.  Both are cornerstones of the Department’s approach to dealing with corporate misconduct, but the current policies reflect a more nuanced, common-sense approach to determining when cooperation credit can and should be offered.

            The Yates Memo directed DOJ attorneys to offer cooperation credit in criminal and civil matters only if corporations identified and shared with DOJ all relevant facts about the individuals involved in corporate misconduct.  Anything considered less than 100% disclosure of every person even tangentially involved and every fact about what they did disqualified the corporation from credit.  The result, as Deputy Attorney General Rosenstein acknowledged, was often prolonged, costly investigations that ultimately led to the same result as the current standard – with the government applying notions of fairness and the rule of law to hold only the most responsible parties accountable.

            The current policy now creates some flexibility where there was none before, and it reflects the reality inherent in these types of investigations: identifying every single person and every single fact relevant to alleged misconduct is not only impractical, but also unnecessary to achieve the Department’s goals.  So, under the current policy, companies can receive cooperation credit in criminal cases where the company has identified every individual “substantially involved in or responsible for the criminal conduct.” 

            The policy revisions also provide meaningful changes to DOJ’s approach to resolving civil cases.  Prior DOJ policy prohibited our civil attorneys from offering any cooperation credit to a company in the civil context unless the company complied with the all-or-nothing approach of the Yates Memo.  But now, our civil attorneys have the ability to offer partial cooperation credit in civil cases in certain circumstances, and can offer full cooperation credit when the company identifies those “substantially involved.”  As Mr. Rosenstein observed, the binary choice of full credit or no credit embodied in the Yates Memo “delayed resolution while providing little or no benefit.”  Instead of furthering the goal in civil cases of recovering money, the prior policy drained our resources and resulted in prolonged investigations.

            All told, these and other revisions reflect a measured approach that balances the competing interests at stake.  And yes – these policies can promote collaboration and communication between our organizations.  How so?  Because they afford companies a more realistic path towards receiving credit and allow DOJ attorneys to focus efforts on identifying targets who are the true wrongdoers – those who committed, directed or supervised the underlying misconduct and who warrant punishment.  And they restore a measure of discretion to DOJ attorneys in deciding what information they must obtain during an investigation. 

            These policies promote the sort of deterrence that the Department and my Office want to see in the corporate community.  The most effective way to deter corporate misconduct is to punish those individuals who are actually responsible for it – most seriously, those individuals who actually committed a crime.  Within your organization, I want you to focus your attention on that and help me and my Office get to the bottom of the issue, as quickly as possible.

            As these new policies are applied on a case-by-case basis, rest assured that my Office welcomes an open dialogue with you and your clients as we perform our core function – to enforce the rule of law and ensure that individuals substantially involved in corporate wrongdoing are identified, prosecuted, and punished.  I understand that most companies want to do the right thing.  And I understand that the people in this room – highly educated and successful legal professionals who take your ethical responsibilities seriously and have taken an oath to uphold the law – certainly want to do the right thing.  As Deputy Attorney General Rosenstein has stated: “companies that self-report, cooperate, and remediate the harm they caused will be rewarded.  Companies that condone or ignore misconduct will pay the price.”  In large part, the choice is up to you, and I hope and expect that you will make the right choice, should you find yourself confronted with it.

            The benefits that can flow from open lines of communication and a cooperative approach are clear if your client is the target of a criminal or civil investigation.  But these benefits are not limited to that situation.  Indeed, I want you to think of my Office as an important ally when your business has been victimized – say, for example, by employees or customers who are stealing from your company.  Unfortunately, these situations are all too common.  And when they occur, it’s important to view my Office as a critical resource – as a partner whose interests are aligned with yours.

            Here are a few examples of what I mean.  This past year, my Office prosecuted high-level GlaxoSmithKline employees, scientists who were Chinese nationals, for conspiracy to steal trade secrets from the company.  These employees were helping to develop biopharmaceutical products – assets that typically cost in excess of $1 billion to research and develop – and then stealing them from GSK and sending them to China.  In doing so, these criminals were attempting to destroy the lifeblood of the company – stealing its intellectual property and engaging in economic warfare. 

            GSK was an excellent partner with my Office, working shoulder-to-shoulder with our prosecutors and cooperating so that we could collect the necessary information to hold the responsible individuals accountable.  And we did just that.  Dr. Tao Li, Dr. Yu Xue, and Dr. Yan Mei, were prosecuted for their crimes; all have pled guilty and await sentencing.  

            Another example of this collaborative approach is found in the insider trading case involving former Philadelphia Eagle, Mychal Kendricks, and his friend, Damilare Sonoiki.  Mr. Sonoiki worked at a global investment firm and used material, non-public information to turn an illegal profit, and provided such information to Mr. Kendricks to do the same.  Mr. Sonoiki’s former corporate employer fully cooperated with my Office and with the Securities and Exchange Commission during our investigation into this unlawful conduct.  The company’s cooperation allowed us to uncover key information, and quickly identify and prosecute the wrongdoers.  Mr. Kendricks and Mr. Sonoiki have pleaded guilty and await sentencing.

            A good example of a recent crime prevention initiative is our public service campaign to deter Hobbs Act robberies in the Eastern District of Pennsylvania.  Our Office is working with local and national convenience stores, drugstores, and fast food chains to alert the public (and criminals) that if you walk into a business and attempt to rob it, we can prosecute that crime federally – and the potential penalties are steep, especially if the crime involves a gun.  This partnership is crucial to communicating a unified, powerful deterrent message – that “a federal crime means federal prison time” for the perpetrators.  We will continue to work with our corporate partners to create public service announcements and promotional materials that highlight our commitment to keeping our streets and storefronts safe.

            In conclusion, we at the U.S. Attorney’s Office take very seriously our responsibility to investigate and prosecute criminals who commit corporate misconduct.  As I have pledged from day one, my Office will enforce the law in a fair and non-partisan manner, regardless of who you are, where you come from, or how much power or influence you have.  We will apply that neutral principle to corporations and senior leaders who commit crimes or direct others to do so.

            But the other takeaway from my remarks today, I hope, is that my Office and I are also here to help you do your job.  As I said previously, most companies and their leaders want to do the right thing.  Fostering communication and cooperation will only help us get to the right result – which is to hold wrongdoers accountable and to deter misconduct. 

            Again, I appreciate the opportunity to be with you today.  Thank you for your attention, and thank you for your commitment to the rule of law.

PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced today the filing of federal charges in connection with a health care fraud scheme involving Liberation Way, a drug and alcohol rehabilitation organization that had treatment centers in Yardley, Bala Cynwyd, and Fort Washington, Pennsylvania.  Dr. Ramesh Sarvaiya, 64, of Voorhees, New Jersey, and Jessie Peters, 44, of Lake Worth, Florida, charged separately by Information, are each charged with one count of conspiracy to commit health care fraud, in violation 18 U.S.C. § 371.  The federal charges were announced at a press conference announcing related state charges filed by the Pennsylvania Office of the Attorney General. 

The federal charging documents allege each man participated in an elaborate scheme involving thousands of medically-unnecessary urine tests ordered by Dr. Sarvaiya and processed by a lab in Florida associated with Peters.  The charging documents allege that defendant Sarvaiya ordered tests to be performed on samples obtained from Liberation Way patients, even though Sarvaiya never treated those patients.  The tests were then sent to Florida-based laboratories for a battery of unnecessary tests, and Peters allegedly paid kickbacks to principals at Liberation Way in return for directing the samples to his company.

If convicted, each defendant faces a maximum possible sentence of five years’ imprisonment and a fine of $250,000, along with restitution of millions to the victims of this fraud. 

“With these charges, we intend to send a clear message to those seeking to build their fortunes on fraud and the despair of individuals battling addiction:  health care fraud and the opioid epidemic are major priorities for the United States Attorney’s Office, and your illegal actions will be uncovered,” said First Assistant U.S. Attorney Williams at the press conference earlier today.   “We are honored to work together with the Pennsylvania Office of the Attorney General, the Florida State Attorney’s Office, as well as with the Federal Bureau of Investigation, Department of Health and Human Services–Office of the Inspector General, and the Office of Personnel Management–Office of the Inspector General, on these critical issues that impact each and every individual as a health care consumer.”

“It’s shameful when medical professionals prioritize profits over patients,” said Christian Zajac, Assistant Special Agent in Charge of the FBI’s Philadelphia Division. “For those involved, insurance schemes must seem like a convenient way to cash in. Just know that the FBI, alongside our state and federal partners, is committed to finding, investigating and bringing to justice anyone defrauding this country’s vital healthcare system. In other words: you won’t get away with it forever.”

"Today's fine work by the Department of Justice, OPM-OIG criminal investigators, and our other law enforcement partners demonstrates our office's commitment to combatting fraud and abuse in the Federal Employees Health Benefits Program," said Thomas W. South, Deputy Assistant Inspector General for Investigations, U.S. Office of Personnel Management.  "We will continue to aggressively investigate and prosecute all individuals who seek to steal taxpayer dollars and drive up health care costs for Federal employees and their families."

“Combating health care fraud and the opioid epidemic are top priorities, said Maureen R. Dixon, Special Agent in Charge, of the Office of the Inspector General for the Department of Health and Human Services (HHS-OIG).  HHS-OIG will continue to work with our law enforcement partners to protect the integrity of all HHS Programs.”

The case was investigated by the Federal Bureau of Investigation, the Department of Health and Human Services, the Office of Personnel Management, and the Department of Labor, in conjunction with the Pennsylvania Office of the Attorney General and the Florida State Attorney’s Office.  It is being prosecuted by Assistant United States Attorney Nancy Winter.

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

The Department of Justice’s Civil Rights Division and the United States Attorney’s Offices for the Western, Middle, and Eastern Districts of Pennsylvania today announced a settlement agreement with the Pennsylvania Department of Education (PDE) to resolve a federal civil rights investigation into complaints about PDE’s statewide system of alternative education programs, known as Alternative Education for Disruptive Youth (AEDY).

"All students should be provided an opportunity to succeed and are entitled to learn in an educational environment free from discrimination,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “We commend PDE’s cooperation throughout our investigation and for its commitment to ensure that students with disabilities and English learners are not prevented from learning opportunities afforded to other students. All students should receive the lawfully-required help they need to participate equally in schools.”

“Pennsylvania must ensure that children with disabilities are not placed in an alternative disciplinary program simply because they have a disability,” said United States Attorney Freed.  “We applaud the Commonwealth of Pennsylvania for implementing numerous changes to its AEDY Programs already, which, coupled with this agreement, will improve the education of children with disabilities and give all children the opportunity to learn English in AEDY Programs.” 

“Federal law does not allow schools to discipline students because of their disability, or to deprive them of an opportunity to learn English,” said United States Attorney William M. McSwain when announcing the resolution for the Eastern District of Pennsylvania. “This agreement protects their civil rights, and comes with laudable cooperation by the Commonwealth of Pennsylvania.”

The investigation was conducted under Title II of the Americans with Disabilities Act, which prohibits state and local government entities, including public schools, from discriminating based on disability. In addition, the Justice Department investigated under the Equal Educational Opportunities Act of 1974, which prohibits a state from denying equal educational opportunity based on national origin by failing to take appropriate action to overcome language barriers that impede equal participation by students in an instructional program.

Under the settlement agreement, PDE will monitor the AEDY system to ensure that students are not placed in AEDY in a manner that discriminates based on disability; that they are not denied equal educational opportunities; and that students with disabilities are transferred back to their home schools in a timely manner. In addition, the agreement will require Pennsylvania to ensure that local educational agencies provide appropriate language assistance services to English Learner (EL) students.  The United States will monitor compliance with the terms of the agreement.

Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt.

PHILADELPHIA – The U.S. Attorney’s Offices for the Eastern, Middle, and Western Districts of Pennsylvania announced jointly today that the Pennsylvania Department of Education (PDE) has agreed to resolve a federal civil rights investigation into its statewide system of alternative education programs, known as Alternative Education for Disruptive Youth. Under Pennsylvania law, students in grades 6 through 12 can be referred to these programs for temporary placements when they meet statutory criteria. These programs are separate from students’ usual general education programs, and do not typically offer the same access to instructional programs or activities.

The United States Department of Justice received complaints that these alternative education programs discriminated against students based on disability and failed to provide appropriate services to students who are learning English as a second language. In response, the Department of Justice investigated PDE’s approval and oversight of these programs across Pennsylvania.

The federal investigation arose under Title II of the Americans with Disabilities Act, which prohibits state and local government entities, including public schools, from discriminating based on disability. In addition, the Equal Educational Opportunities Act of 1974 prohibits a state from denying equal educational opportunity based on national origin by failing to take appropriate action to overcome language barriers that impede equal participation by its students in an instructional program.

Under the settlement agreement, PDE will take measures designed to remedy the complaints. The agreement requires PDE to ensure that students with disabilities receive individual assessments to determine whether they are being placed in alternative education programs because of their disability.  The agreement also requires PDE to monitor whether these programs have timely transferred students with disabilities back to their home schools. In addition, the agreement requires PDE to guarantee that local educational agencies attempt appropriate interventions before referring students with disabilities to alternative education programs, and to ensure that students are not placed in these programs solely because of disability. 

The agreement will also require PDE to ensure that local educational agencies establish a service plan for students who are learning English in alternative education programs to ensure that they receive appropriate language assistance services. PDE will also improve its process for receiving and responding to complaints from parents or others regarding alternative education programs, and revise its non-discrimination policies and data monitoring practices to comply with federal law.

“Federal law does not allow schools to discipline students because of their disability, or to deprive them of an opportunity to learn English,” said United States Attorney William M. McSwain when announcing the resolution for the Eastern District of Pennsylvania. “This agreement protects their civil rights, and comes with laudable cooperation by the Commonwealth of Pennsylvania.”

“Pennsylvania must ensure that children with disabilities are not placed in an alternative disciplinary program simply because they have a disability,” said David J. Freed, United States Attorney for the Middle District of Pennsylvania. “We applaud the Commonwealth of Pennsylvania for implementing numerous changes to its AEDY Programs already, which, coupled with this agreement, will improve the education of children with disabilities and give all children the opportunity to learn English in AEDY Programs.” 

“All students should be provided an opportunity to succeed and are entitled to learn in an educational environment free from discrimination,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “We commend PDE’s cooperation throughout our investigation and for its commitment to ensure that students with disabilities and English learners are not prevented from learning opportunities afforded to other students. All students should receive the lawfully-required help they need to participate equally in schools.”

Assistant U.S. Attorney Michael S. Macko handled the case, working jointly with the Department of Justice’s Civil Rights Division and with Assistant U.S. Attorneys Michael Butler and Jennifer Andrade from the Middle and Western Districts of Pennsylvania, respectively.

PHILADELPHIA – United States Attorney William M. McSwain announced today that James Hill, of Philadelphia, PA, was convicted at trial of one count of possession of a firearm by a convicted felon.  Sentencing is scheduled before United States District Judge Gerald McHugh.

At trial, the government presented evidence that in the early morning hours of July 8, 2018, Philadelphia police officers found the defendant in possession of a .9mm Sig Sauer pistol loaded with fourteen live rounds in the magazine.  Further investigation revealed that the defendant was barred from possessing a firearm because he had a previous felony conviction.

“Reducing violent crime is a top priority of my Office and of the Department of Justice, and successful prosecutions of cases like this remain a key part of our deterrence strategy,” said U.S. Attorney McSwain.  “My Office remains committed to working with the Philadelphia Police Department to clear the Philadelphia streets of firearms in the hands of convicted felons, which undeniably pose a serious threat to public safety in our City.”

“The investigation, arrest, and successful prosecution of James Hill serves as evidence of the effectiveness of strong and consistent collaboration between law enforcement agencies,” said Richard J. Ross, Jr., Philadelphia Police Commissioner.  “With the conviction and impending sentencing, a recidivist offender will no longer be able to re-offend in our neighborhoods.  This, along with the continuing efforts of the Project Safe Neighborhoods partner agencies, will have an appreciable impact on the quality of life of the residents of our great city.”

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.

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

A Yeadon, Pennsylvania, resident was sentenced today to 12 months and 1 day in prison for filing false tax returns and conspiring to defraud the United States, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division, United States Attorney William M. McSwain, and Internal Revenue Service, Criminal Investigation (IRS-CI) Special Agent in Charge Guy Ficco.

On Oct. 12, 2018, Deron Joe was found guilty of one count of conspiring to defraud the United States by preparing and filing false tax returns and 11 counts of aiding and assisting in the filing of false tax returns for the 2007, 2008, and 2009 tax years. Court documents and evidence presented at trial showed that Joe co-owned and operated Edron Tax Professionals with his co-conspirator. From 2007 through 2010, Joe and his co-conspirator prepared tax returns for clients that falsely claimed employee business expenses and other unwarranted deductions. The false deductions allowed the co-conspirators to inflate clients’ refunds by thousands of dollars. Joe prepared the false tax returns with inflated refunds in order to grow his clientele.

The sentence was imposed by U.S. District Judge Petrese B. Tucker for the Eastern District of Pennsylvania. Judge Tucker also sentenced Joe to three years of supervised release.

Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney McSwain commended agents of the Internal Revenue Service-Criminal Investigation, who investigated the case, and Department of Justice Tax Division Trial Attorneys Christopher P. O’Donnell and Kathryn D. Sparks, who prosecuted the case.

PHILADELPHIA – United States Attorney William M. McSwain announced that Richard Boyle, 59, of Doylestown, PA was convicted today by a federal jury of 11 separate bank robberies, 10 counts of brandishing, using, and carrying a firearm during a crime of violence, and 10 counts of money laundering. The sentencing hearing is scheduled on July 15, 2019 before the Honorable Gene E.K. Pratter.

The defendant was a serial bank robber, sometimes referred to as the “Straw Hat Bandit.” During 11 separate bank robberies, the defendant stole a total of $495,686. He was able to steal that stunning total by threats of violence, including taking over the bank and forcing bank employees at gunpoint to open the vaults and cash-rich ATM machines. The defendant made careful plans to avoid apprehension, including wearing disguises, gloves, and even spreading bleach on the floor of the banks to conceal his DNA. Immediately prior to certain bank robberies, the defendant attempted to slow the police response time to the bank robbery alarms by calling police or security about false reports, including a bomb threat at a country club, a planned attack at a mall, and a man with a gun at Temple University. After the robberies, the defendant laundered the proceeds of his robberies by routing the funds through his photography business, Sky Eye View, in an attempt to conceal the source of this income.

“The defendant’s conduct in this case was outrageous,” said U.S. Attorney McSwain. “From robbing banks and holding innocent bank employees at gunpoint to calling in hoax threats to divert law enforcement resources and slow response time, Boyle had no regard for the safety of anyone in the community. He only cared about lining his own pockets with stolen cash. We are grateful that the jury held him accountable for his many crimes.”

“Eight and a half years ago, Richard Boyle stood in a different courtroom, having confessed to a string of bank robberies,” said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. “He said he wished he could’ve made better choices. But after serving out his prison sentence, he was soon robbing banks again--this time, in disguises and at gunpoint. Given the chance to do and be better, he instead chose to escalate his crimes. In doing so, he terrorized the employees of nearly a dozen banks and put people’s lives at risk. The FBI appreciates that this jury, having weighed the considerable evidence against Mr. Boyle, chose to find him guilty as charged.”  

The case was investigated by the Federal Bureau of Investigation, and the case is being prosecuted by Assistant United States Attorneys Robert Livermore and Sean McDonnell.

PHILADELPHIA – United States Attorney William M. McSwain announced today that Linda Paolini, 43, of Philadelphia, Pennsylvania, was charged today by Indictment with two counts of manufacturing and attempted manufacturing of child pornography and one count of online enticement of a minor.

The charges arise out of a telephone tip received by the FBI.  Defendant Paolini, who was pretending to be an underage girl, communicated through Instagram with an underage boy, soliciting him for videos of him engaging in sexually explicit conduct.  Over the course of months, she and her victim exchanged over 50,000 Instagram messages, including explicit and sexually-charged chats.  On January 22, 2019, Paolini was arrested by federal authorities, was charged by criminal complaint the next day, and, on January 28, was ordered detained pending trial. 

If convicted, Paolini faces life imprisonment, with a mandatory minimum of at least 15 years, a mandatory term of supervised release of at least 5 years but up to a lifetime of supervised release, a $750,000 fine, and $15,300 in special assessments

“The facts alleged in this indictment present an all-too-familiar scenario – an adult using the Internet and social media to lure and abuse children,” said U.S. Attorney McSwain. “The Department of Justice’s Project Safe Childhood program – a nationwide initiative to combat child sexual exploitation and abuse – 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.  The investigation and prosecution of this defendant is part of our successful enforcement in this area.”

The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Michael J. Rinaldi.

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 eight individuals from Reading were indicted yesterday by a federal grand jury on 21 counts of drug distribution and firearms offenses. The individuals are:

• Jesus Feliciano-Trinidad, a/k/a “Chewy,” a/k/a “Che,” 29;
• Sharon Melendez-Ortiz, a/k/a “La Rubia,” 39;
• Fitzgerald Daliot-Rios, 29;
• Yomar Velazquez-Figueroa, a/k/a “Negrito,” 21;
• Dewayne Quinones, a/k/a “Hombre,” 25;
• Gisela Mendez, 42;
• Mariela Alvarado, a/k/a “Onyx,” 38; and
• Owen Malave-Medina, 22.
   

The charges stem from a months’ long investigation by the U.S. Attorney’s Office, the Berks County District Attorney’s Office, the Berks County Detectives, the Reading Police Department, and the FBI into the receipt, processing, and distribution of a wide variety of drugs including methamphetamine, heroin, fentanyl, cocaine, and crack cocaine.  According to the indictment, the defendants used a number of buildings, residences, firearms, and acts of violence to further their drug dealing efforts in and around the Reading area.  The indictment further alleges that various defendants turned to proposed violence, conspiring to shoot certain individuals and commit a kidnapping in February 2018.

If convicted, defendants Feliciano-Trinidad, Melendez-Ortiz, Velazquez-Figueroa, Daliot-Rios, Alvarado, and Malave-Medina face up to life imprisonment.  If convicted, defendants Quinones and Mendez face up to 40 years imprisonment.

“These are serious federal charges with serious federal penalties,” said U.S. Attorney McSwain. “My Office is committed to working with the Berks County District Attorney’s Office and all of our federal, state, and local law enforcement partners to keep the Reading community safe.”

“If convicted of the alleged crimes, this drug trafficking organization would be one of the most violent organizations that we have ever dealt with in Berks County,” said Berks County District Attorney John. T. Adams.

“Violent drug gangs have such a corrosive effect on society,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “Their crimes affect people’s peace of mind and quality of life. The FBI is committed to supporting our local law enforcement partners as we all work toward safer communities. We’re determined to make a difference, one corner, one block, one neighborhood at a time.”

The case was investigated by the Berks County District Attorney’s Office, the Berks County Detectives, the Reading Police Department, and the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorneys Jonathan B. Ortiz and Kelly A. Lewis Fallenstein, and Special Assistant United States Attorney Rosalynda Michetti.

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

A Philadelphia-area doctor pleaded guilty today to illegal distribution of oxycodone.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney William M. McSwain of the Eastern District of Pennsylvania, Special Agent in Charge Michael T. Harpster of the FBI’s Philadelphia Field Office, Special Agent in Charge Maureen Dixon of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Philadelphia Regional Office, Special Agent in Charge Jonathan A. Wilson of the U.S. Drug Enforcement Administration’s (DEA) Philadelphia Field Division and U.S. Marshal David B. Webb of the Eastern District of Pennsylvania made the announcement.

Richard Ira Mintz, D.O., 69, of Dresher, Pennsylvania, pleaded guilty to eight counts of distributing controlled substances outside the scope of professional practice and not for a legitimate medical purpose before U.S. District Court Judge Michael M. Baylson of the Eastern District of Pennsylvania.  Sentencing is scheduled for Sept. 11.

“Richard Ira Mintz violated both his professional duty and the law by selling prescriptions for addictive opioids for individuals he never examined who had no medical need for the drugs,” said Assistant Attorney General Benczkowski.  “Halting the deadly scourge of opioids requires aggressively pursuing corrupt medical professionals who contribute to the opioid epidemic — and that is precisely why we created this regional Strike Force.  I want to commend our prosecutors and all of our Strike Force partners for their ongoing work on this vital law enforcement priority.”

“Instead of adhering to his oath to ‘do no harm,’ this doctor chose to use his prescription pad to do just the opposite: with every stroke of the pen, he pushed dangerous opioids onto the streets and turned an illegal profit,” said U.S. Attorney McSwain.  “It is because of the partnership between the Department of Justice’s Criminal Fraud Section and the U.S. Attorney Offices of the District of New Jersey and the Eastern District of Pennsylvania that this doctor will be held accountable for his actions. “

“Yet another long-time physician is caught illicitly pushing pills,” said FBI Special Agent in Charge Harpster.  “Despite all that education and experience, at some point Richard Mintz’s priorities shifted and his ethics lapsed.  Doctors dealing oxycodone to anyone who can pay for it are directly fueling the opioid crisis, and the FBI will continue to investigate and bring to justice medical professionals involved in this dangerous drug diversion.”   

“Prescribing deadly opioids without regard to the consequences simply cannot be tolerated,” said HHS-OIG Special Agent in Charge Dixon.  “We will continue to work with our law enforcement partners to hold accountable criminals who scheme to profit from prescribing medically unnecessary drugs.”

“This case is just one of many examples of federal law enforcement agencies working in close cooperation with each other to investigate and prosecute doctors who are prescribing and dispensing controlled substance medications without any legitimate medical purpose,” said DEA Special Agent in Charge Wilson. 

In pleading guilty, Mintz admitted that, from about July 2016 through about July 2018, he worked at a medical practice in Philadelphia, Pennsylvania.  He admitted that he sold eight fraudulent and medically unnecessary oxycodone prescriptions.  Michael Young, charged elsewhere, purchased the 120 tablet 30 mg oxycodone prescriptions for $120 per person.  Mintz wrote the prescriptions in the names of three individuals whom he had never met or examined.

This case was investigated by the FBI, HHS-OIG, DEA and the U.S. Marshals Service.  Trial Attorney Adam Yoffie of the Criminal Division’s Fraud Section is prosecuting the case.

The Criminal Division’s Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.   

PHILADELPHIA – Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and United States Attorney William M. McSwain announced today that Richard Ira Mintz, D.O., 69, of Dresher, Pennsylvania, pleaded guilty to eight counts of distributing controlled substances outside the scope of professional practice and not for a legitimate medical purpose.

From approximately July 2016 through July 2018, Mintz worked at a medical practice in Philadelphia, Pennsylvania, where he sold fraudulent and medically unnecessary oxycodone prescriptions.  Mintz wrote the prescriptions in the names of three individuals whom he had never met or examined.

This case originated as part of a regional Medicare Fraud Strike Force that operates in the Eastern District of Pennsylvania and the District of New Jersey.  The Strike Force is a joint initiative between the Department of Justice and Department of Health and Human Services to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.   

“Richard Ira Mintz violated both his professional duty and the law by selling prescriptions for addictive opioids for individuals he never examined who had no medical need for the drugs,” said Assistant Attorney General Benczkowski.  “Halting the deadly scourge of opioids requires aggressively pursuing corrupt medical professionals who contribute to the opioid epidemic — and that is precisely why we created this regional Strike Force.  I want to commend our prosecutors and all of our Strike Force partners for their ongoing work on this vital law enforcement priority.”

 “Instead of adhering to his oath to ‘do no harm,’ this doctor chose to use his prescription pad to do just the opposite: with every stroke of the pen, he pushed dangerous opioids onto the streets and turned an illegal profit,” said U.S. Attorney McSwain.  “As I stated at the launch of this new regional Strike Force partnership between the Department of Justice’s Criminal Fraud Section and the U.S. Attorney’s Offices for the Eastern District of Pennsylvania and the District of New Jersey, combatting the opioid epidemic is a major priority of my Office. “Physicians who abuse their positions of trust within the community for financial gain will be held accountable by my Office.”

“Yet another long-time physician is caught illicitly pushing pills,” said Michael T. Harpster, Special Agent in Charge of the Federal Bureau of Investigation, Philadephia Field Division.  “Despite all that education and experience, at some point Richard Mintz’s priorities shifted and his ethics lapsed.  Doctors dealing oxycodone to anyone who can pay for it are directly fueling the opioid crisis, and the FBI will continue to investigate and bring to justice medical professionals involved in this dangerous drug diversion.”  

“Prescribing deadly opioids without regard to the consequences simply cannot be tolerated,” said Maureen Dixon, Regional Inspector General, Department of Health and Human Services-Office of Inspector General.  “We will continue to work with our law enforcement partners to hold accountable criminals who scheme to profit from prescribing medically unnecessary drugs.”

“This case is just one of many examples of federal law enforcement agencies working in close cooperation with each other to investigate and prosecute doctors who are prescribing and dispensing controlled substance medications without any legitimate medical purpose,” said Jonathan Wilson, Special Agent in Charge for the Drug Enforcement Administration, Philadelphia Field Division.

This case was investigated by the Federal Bureau of Investigation, Department of Health and Human Services-Office of Inspector General, Drug Enforcement Administration, and the United States Marshals’ Service.  Trial Attorney Adam Yoffie of the Criminal Division’s Fraud Section is prosecuting the case.

PHILADELPHIA – United States Attorney William M. McSwain announced that Juan Jarmon, 32 of Philadelphia, was convicted today of one count of conspiracy to distribute 280 grams or more of cocaine base (“crack”); one count of unlawful use of a communication facility in furtherance of a drug felony; five counts of distribution of cocaine base (“crack”); one count of aiding and abetting distribution of cocaine base (“crack”); five counts of possession with intent to distribute cocaine base (“crack”); and 10 counts of distribution of and possession with intent to distribute cocaine base (“crack”) within 1,000 feet of public housing.  

The defendant was a leader of the Jarmon/Edwards drug-trafficking group (DTG) that sold crack cocaine in and around the Norman Blumberg Apartment Complex (Blumberg) in North Philadelphia from at least late 2012 through late 2014.  Blumberg was a public housing facility that contained two children’s playgrounds.  DTG members sold crack cocaine 24 hours a day, 7 days a week, in and around the Blumberg high-rise buildings, which included the Hemberger Building and the Judson Building. The DTG employed a large network of supervisors, sellers, lookouts, suppliers, and those that permitted DTG members to use their apartments as stash locations and hideouts. During the course of the conspiracy, the group supplied over $1,000,000 of crack cocaine to this neighborhood.

From late 2012 until early-to-mid 2014, the defendant controlled drug sales in the Hemberger Building. Among other duties, the defendant purchased bulk crack and cocaine; cooked and packaged crack cocaine into bundles; sold crack cocaine to other drug traffickers and drug users; hired, fired, and supervised shift sellers and lookouts; secured apartment space and stash locations for their members; supplied bundles of crack cocaine to shift sellers; collected drug proceeds from shift sellers; levied taxes on members and customers; and provided protection to other drug trafficking groups. The defendant preyed on the financial weakness and vulnerability of others (including drug addicts, juveniles, the mentally ill, and those living in poverty) in order to further the interests of the DTG.

 “Jarmon made money hand over fist selling crack for years, controlling his crew and capitalizing on other people’s addiction.  Today’s verdict ensures that our streets are safer because Jarmon will remain where he belongs – behind bars – for years to come,” said U.S. Attorney McSwain.  “I commend the hardworking prosecutors from my office and our law enforcement partners for putting this case together and holding this defendant accountable for the destruction he caused.”

“Juan Jarmon and his crew kept a tight, violent grip on the Blumberg Apartments complex and surrounding areas,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division.  “Selling crack day and night, they made a nice profit, at the cost of the neighborhood’s quality of life.  The FBI and our partners will continue to work to make this city safer by putting drug traffickers out of business and behind bars.”

“Juan Jarmon was convicted of leading a drug trafficking organization responsible for distributing crack cocaine in and around the former Norman Blumberg Apartment complex, which was one of the largest public housing projects in Philadelphia,” said Jonathan A. Wilson, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Philadelphia Field Division.  “Jarmon and his associates sold the crack cocaine to street-level users, profiting from their addictions, and damaging the health and safety of the residents of the housing project.  This case was a joint effort of the DEA, the Federal Bureau of Investigation, and the Philadelphia Police Department.”

“The investigation, arrest, and successful prosecution of Juan Jarmon serve as an example of the effectiveness of strong and consistent collaboration between law enforcement agencies,” said Richard J. Ross, Jr., Philadelphia Police Commissioner.  “We anticipate that this conviction will further disrupt narcotics trafficking and attendant criminal activity in and around the Norman Blumberg apartment complex, as well as the surrounding North Philadelphia neighborhood, and have an appreciable impact on the quality of life of our residents.”

This case was investigated by the Federal Bureau of Investigation, Drug Enforcement Administration, and the Philadelphia Police Department and is being prosecuted by Assistant United States Attorneys Jerome Maiatico and Yvonne Osirim.

The owner and operator of First Premier Tax Service, a Philadelphia, Pennsylvania, tax preparation business and a return preparer working at the business, were charged in connection with a scheme to prepare fraudulent tax returns in order to reduce taxes and inflate federal tax refunds for their clients, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman and U.S. Attorney William McSwain for the Eastern District of Pennsylvania.

An indictment returned by a federal grand jury charged both Nvahbulai Quisiah and Gofin Kosia, also known as Kafumba Kromah, with one count of conspiracy to defraud the United States, three counts of wire fraud, and three counts of aggravated identity theft. Quisiah was also charged with eight counts of aiding and assisting in the preparation and filing of a false tax return. Kosia was charged with nine counts of aiding and assisting in the preparation and filing of a false tax return.

According to the indictment, Quisiah and Kosia prepared tax returns for clients for tax years 2009 through 2016 that fraudulently inflated itemized deductions, claimed fictitious Schedule C businesses, and claimed false dependents.  As a result of these false items and deductions, the defendants allegedly inflated claimed tax refunds for their clients.  The indictment alleges that the defendants knew their clients were not entitled to such refunds.  One of the clients was an IRS agent acting in an undercover capacity.  The indictment also alleges that the defendants bought and sold personal identifying information of children in order to falsely claim the children as dependents on tax returns for the defendants’ clients.    

If convicted of aggravated identity theft, the defendants face a mandatory minimum sentence of two years in prison.  Each count of wire fraud carries a maximum sentence of twenty years in prison, while each count of aiding and assisting in the preparation of false tax returns carries a maximum three year prison term.   The defendants also face a period of supervised release, fines, and the payment of restitution.

An indictment merely alleges that crimes have been committed. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

The case was investigated by Internal Revenue Service’s Criminal Investigation Division and is being prosecuted by Assistant U.S. Attorney Anthony Wzorek and Department of Justice Tax Division Attorney Ann M. Cherry. 

PHILADELPHIA, PA – Attorney General William P. Barr and United States Attorney William M. McSwain today announced the largest coordinated sweep of elder fraud cases in history, surpassing last year’s nationwide sweep.  The cases during this sweep involved more than 260 defendants from around the globe who victimized more than two million Americans, most of whom are elderly.

Two cases from the Eastern District of Pennsylvania are included in this nationwide sweep.  In United States v. John Conner, the defendant was a lawyer who took advantage of his 85-year old client by using a power of attorney agreement to withdraw more than $95,000 from her bank account so he could gamble with her money at casinos.  A jury convicted the attorney of 19 counts of wire fraud and one count of making a false statement to the FBI following a one-week trial in February 2019; he awaits sentencing.  The case was investigated by the Federal Bureau of Investigation and is being prosecuted by Assistant United States Attorney Mark Dubnoff.

The second case from this District is United States v. Jacoya Brazzle.  There, the defendant was a nursing assistant at the Veterans Affairs Medical Center (“VAMC”) in Coatesville, Pennsylvania.  She allegedly obtained the ATM PIN of a veteran who resides in the assisted living unit at the VAMC, went to ATMs near the VAMC on more than a dozen occasions over the course of six months, and withdrew over $11,000.  The trial is scheduled for later this spring.  The case was investigated by the U.S. Department of Veterans Affairs, Office of Inspector General and is being prosecuted by Assistant United States Attorney Nancy Rue.

“Crimes against the elderly target some of the most vulnerable people in our society,” Attorney General William P. Barr said.  “But thanks to the hard work of our agents and prosecutors, as well as our state and local partners, the Department of Justice is protecting our seniors from fraud.  The Trump administration has placed a renewed focus on prosecuting those who prey on the elderly, and the results of today’s sweep make that clear.  Today, we are announcing the largest single law enforcement action against elder fraud in American history.  This year’s sweep involves 13 percent more criminal defendants, 28 percent more in losses, and twice the number of fraud victims as last year’s sweep. I want to thank the Department’s Consumer Protection Branch, which led this effort, together with the Department’s Criminal Division, the more than 50 U.S. Attorneys’ offices, and the state and local partners who helped to make these results possible. Together, we are bringing justice and peace of mind to America's seniors.”

“Our Office will continue to prioritize prosecuting criminals who prey on our elderly residents,” said U.S. Attorney McSwain.  “I would like to thank Attorney General Barr for his leadership in this initiative; AUSAs Mark Dubnoff and Nancy Rue for their work on the Conner and Brazzle prosecutions; and AUSA Tiwana Wright for her work overseeing the elder abuse cases for our Office.”

The Department took action in every federal district across the country by filing criminal or civil cases or by engaging in consumer education efforts.  In each case, offenders allegedly engaged in financial schemes that targeted or largely affected seniors.  In total, the charged elder fraud schemes caused alleged losses of millions of more dollars than last year, putting the total alleged losses at this year’s sweep at over three quarters of a billion dollars.

The charges in the Brazzle case are allegations, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Since President Trump signed the bipartisan Elder Abuse Prevention and Prosecution Act (“EAPPA”) into law, the Department of Justice has participated in hundreds of enforcement actions in criminal and civil cases that have protected seniors.  The Justice Department has also conducted hundreds of trainings and outreach sessions across the country since the passage of the Act. 

PHILADELPHIA, PA – United States Attorney William M. McSwain, along with Principal Deputy Assistant Attorney General Richard E. Zuckerman, announced today that the owner and operator of a Philadelphia-based tax preparation business and his employee were charged with preparing fraudulent tax returns and related crimes in order to reduce taxes and inflate federal tax refunds for their clients.

Nvahbulai Quisiah, 43, of Philadelphia, and Gofin Kosia, 43, of Philadelphia, were charged by federal indictment with one count of conspiracy to defraud the United States, 17 counts of aiding and assisting in the preparation and filing of a false tax return, 6 counts of wire fraud, and 6 counts of aggravated identity theft.  Quisiah is the owner of First Premier Tax Service, a tax preparation business, and Kosia is a tax preparer employed there.

According to the indictment, Quisiah and Kosia prepared tax returns for clients for tax years 2009 through 2016 that fraudulently inflated itemized deductions, claimed fictitious Schedule C businesses, and claimed false dependents.  As a result of these false items and deductions, the defendants allegedly inflated claimed tax refunds for their clients.  The indictment alleges that the defendants knew their clients were not entitled to such refunds.  One of the clients was an IRS agent acting in an undercover capacity.  The indictment also alleges that the defendants bought and sold personal identifying information of children in order to falsely claim the children as dependents on tax returns for the defendants’ clients.   

If convicted of aggravated identity theft, the defendants face a mandatory minimum sentence of two years in prison.  Each count of wire fraud carries a maximum sentence of twenty years in prison, while each count of aiding and assisting in the preparation of false tax returns carries a maximum three year prison term.   The defendants also face a period of supervised release, fines, and the payment of restitution.

“Tax preparers are supposed to follow and apply our tax laws to assist clients to accurately report their income and pay their fair share of federal taxes, not bend or ignore the rules to suit their client’s needs,” said U.S. Attorney McSwain.  “As alleged, the defendants enriched themselves and their clients at the expense of taxpayers who take seriously their legal obligation to file complete and accurate federal income taxes each year.  My Office will continue to aggressively prosecute these kinds of cases.” 

An indictment alleges that crimes have been committed. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.

The case was investigated by Internal Revenue Service’s Criminal Investigation Division and is being prosecuted by Assistant U.S. Attorney Anthony Wzorek and Department of Justice Tax Division Attorney Ann M. Cherry. 

PHILADELPHIA – U.S. Attorney William M. McSwain announced that Daniel Vermeychuk, 66, of Wallingford, Pennsylvania, was charged in an indictment unsealed today with four counts of wire fraud, one count of social security fraud, and one count of theft from an employee benefit fund.

According to the indictment, the defendant obtained Social Security and pension benefit funds intended for the deceased tenant of an apartment building owned by the defendant’s wife.  After the tenant’s death, the defendant continued to withdraw the benefit funds and used the money for his own purposes.  According to public records, the defendant is an attorney licensed to practice in Pennsylvania.

If convicted, the defendant faces a maximum possible sentence of 90 years imprisonment, full restitution, a fine, and a period of supervised release.

“Daniel Vermeychuk is charged with conduct that, if proven at trial, stands in stark contrast to the oath he swore as an attorney – to uphold the rule of law,” said U.S. Attorney McSwain.  “Instead of entering a courtroom to represent clients before the court, his next appearances will be to answer to these charges, and if found guilty, to be held accountable for them.”

The case was investigated by the Social Security Administration’s Office of Inspector General, the Department of Labor’s Office of Inspector General, and the United States Postal Inspection Service. The case is being prosecuted by Special Assistant United States Attorney Christopher E. Parisi.

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 today that the United States reached a $260,000 civil settlement with HNTB, Inc. concerning HNTB's alleged improper billing under a contract to provide catenary services (i.e., overhead electrical wires) with Amtrak.

HNTB provided services as part of the New Jersey High Speed Rail Improvement Program under Amtrak Architectural & Engineering Services Contract. The Contract required that HNTB bill actual labor and overhead rates for the employees working on this project. The United States contends that it has certain civil claims against HNTB arising from HNTB's billing under the Contract during the period December 5, 2012 through July 28, 2017. This conduct included HNTB overbilling Amtrak by not adjusting its overhead rates in subsequent contract years to match actual overhead rates. Instead, HNTB continued to bill overhead at a maximum rate listed in the Contract.

“Our Office is dedicated to helping Amtrak and our other federal partners maintain the integrity of their contracts,” said U. S. Attorney McSwain. “The excellent work of the Amtrak Office of Inspector General laid the groundwork for a fair and speedy resolution of this matter and reinforces the duty of contractors to ensure compliance with the terms of their federal contracts.”

“We remain committed to investigating any case where there are credible indicators of a contractor overbilling Amtrak,” said Tom Howard, Amtrak Inspector General. “This settlement is indicative of that commitment and was the result of hard work by dedicated staff coupled with seamless collaboration with the U.S. Attorney's Office.”

Amtrak's Office of Inspector General initiated an investigation after discovering discrepancies in HNTB's billing during a review of select Amtrak contracts. Assistant United States Attorney Colin Cherico and Auditor Dawn Wiggins supported the OIG's investigation and handled the settlement for the United States Attorney's Office for the Eastern District of Pennsylvania.

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