Washington, DC--(ENEWSPF)--April 13, 2015.  Two Colombian nationals were sentenced to decades in U.S. federal prison today for their roles in the kidnapping and murder of former Drug Enforcement Administration (DEA) Special Agent James “Terry” Watson in Bogotá, Colombia, on June 20, 2013. 

Attorney General Eric Holder, Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Dana J. Boente of the Eastern District of Virginia, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, DEA Administrator Michele M. Leonhart and Bill A. Miller, Director, U.S. State Department’s Diplomatic Security Service (DSS) made the announcement.

“With these sentencings, all seven defendants involved in the kidnapping and murder of Special Agent Terry Watson have been found, prosecuted, and brought to justice,” said Attorney General Holder.  “Special Agent Watson was a courageous patriot, a principled law enforcement agent, and a proud defender of the rule of law.  Our nation owes him and his loved ones a debt we can never repay.  And although our prosecution of his heinous attackers has come to its rightful close, the Department of Justice will never rest in our efforts to honor Special Agent Watson’s life of service and sacrifice by upholding the values that he served to protect.”

“DEA is grateful that the final two defendants connected to Terry Watson’s murder faced justice in a U.S. court of law for their heinous crime," said Administrator Leonhart.  “Terry will be remembered for his bravery, dedication and loyalty to our agency’s mission, and his presence is missed every day by the men and women of DEA.  Throughout this ordeal, the Watson family has remained in our thoughts and prayers, and we will never forget their sacrifice.”

Édgar Javier Bello Murillo, 28, and Omar Fabián Valdes Gualtero, 28, were sentenced today to 440 months in prison and 348 months in prison, respectively, by U.S. District Judge Gerald Bruce Lee of the Eastern District of Virginia.  Both pleaded guilty to second degree murder and conspiracy to kidnap an internationally protected person on Dec. 19, 2014. 

In the statements of facts filed with their plea agreements, Valdes Gualtero and Bello Murillo admitted that they conspired to conduct “paseo milionarios” or “millionaire’s rides” in which victims were lured into taxi cabs, kidnapped and then robbed.  Both admitted that, on the evening of June 20, 2013, they were a part of a six-person robbery crew that targeted Special Agent Watson.  One of the members of the crew picked up Special Agent Watson in his taxi, while another drove a second taxi carrying the assailants.  Bello Murillo admitted that he entered the taxi in which Special Agent Watson was riding and stabbed him multiple times.  Special Agent Watson was able to escape from the taxi, but he later collapsed and died from his injuries.

In total, seven defendants were arrested and extradited from Colombia to the United States to face charges in connection with Special Agent Watson’s murder and the subsequent attempt to cover up the crime.  Six defendants pleaded guilty for their respective roles in the kidnapping and murder: Julio Estiven Gracia Ramírez, 32; Héctor Leonardo López, 34; Andrés Álvaro Oviedo García, 22; Edwin Gerardo Figueroa Sepúlveda, 40; Valdes Gualtero; and Bello Murillo.  On Dec. 12, 2014, Gracia Ramírez was sentenced to 27 years in prison, López was sentenced to 25 years in prison and Oviedo García was sentenced to 20 years in prison.  On Feb. 18, 2015, Figueroa Sepúlveda was sentenced to 30 years in prison.  A seventh defendant, Wilson Daniel Peralta-Bocachica, 31, pleaded guilty to obstruction of justice for cleaning the taxi cab in which the attack occurred before turning it in to the Colombian National Police.  On Feb. 18, 2015, Peralta-Bocachica was sentenced to 40 months in prison.

This case was investigated by the FBI, DEA and DSS, in close cooperation with Colombian authorities and with assistance from INTERPOL and the Criminal Division’s Office of International Affairs.  The case is being prosecuted by Special Counsel Stacey Luck of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Michael P. Ben’Ary of the U.S. Attorney’s Office for the Eastern District of Virginia.

The Department of Justice gratefully acknowledges the Colombian Attorney General’s Office, Colombian National Police, Colombian Directorate of Criminal Investigation and Interpol (DIJIN), DIJIN Special Investigative Unit, Bogotá Metropolitan Police, Bogotá Police Intelligence Body (CIPOL) Unit and Colombian Technical Investigation Team for their extraordinary efforts, support and professionalism in responding to this incident.

Source: justice.gov

Washington, DC--(ENEWSPF)--April 13, 2015.  The company owner, a top executive and their company, Quality Egg LLC, were sentenced today in federal district court in Sioux City, Iowa, the Department of Justice announced. 

Austin “Jack” DeCoster, 81, of Turner, Maine, who owned Quality Egg, was sentenced to serve three months in prison to be followed by one year of supervised release, and fined $100,000.  His son, Peter DeCoster, 51, of Clarion, Iowa, who was Quality Egg’s chief operating officer, was also sentenced to serve three months in prison to be followed by one year of supervised release, and fined $100,000.  Quality Egg was sentenced to pay a fine of $6.79 million and placed on probation for three years.  All three defendants were ordered to make restitution in the total amount of $83,008.19.  Quality Egg also agreed to forfeit $10,000 as part of its plea agreement with the government.  The defendants were sentenced by U.S. District Court Judge Mark W. Bennett in the Northern District of Iowa. 

On June 3, 2014, Quality Egg, an egg production company with operations in Wright County, Iowa, pleaded guilty to one count of bribery of a public official, one count of introducing a misbranded food into interstate commerce with intent to defraud and one count of introducing adulterated food into interstate commerce.  Jack and Peter DeCoster each pleaded guilty to one count of introducing adulterated food into interstate commerce.  In plea agreements, the company and the father and son admitted that the company’s shell eggs were adulterated in that they contained a poisonous and deleterious substance, Salmonella Enteriditis, which may have rendered the eggs injurious to health. 

During the spring and summer of 2010, adulterated eggs produced and distributed by Quality Egg were linked to approximately 1,939 reported consumer illnesses in multiple states—a nationwide outbreak of salmonellosis that led to the August 2010 recall of millions of eggs produced by the defendants. 

“The message this prosecution and sentence sends is a stern one to anyone tempted to place profits over people’s welfare,” said the U.S. Attorney Kevin W. Techau of the Northern District of Iowa.  “Corporate officials are on notice.  If you sell contaminated food you will be held responsible for your conduct.  Claims of ignorance or 'I delegated the responsibility to someone else’ will not shield them from criminal responsibility.”

“American consumers deserve to feel secure that the eggs they eat are safe and produced in sanitary conditions,” said Acting Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division.  “The Department of Justice will pursue and prosecute those whose criminal conduct compromises the safety of our food supply.”

“Food manufacturers have a responsibility to produce and sell food that is safe for consumers to eat,” said Dr. Stephen Ostroff, U.S. Food and Drug Administration (FDA) Acting Commissioner.  “Eggs are commonly consumed nationwide, both on their own and as ingredients in other foods.  When manufacturers fail to produce safe food, the FDA will take action to protect public health.”

As noted in the government’s memorandum regarding sentencing, Quality Egg personnel had, for years, disregarded food safety standards and practices and misled major customers, including Walmart, about the company’s food safety practices.  In the memorandum filed with the court, the government noted that since 2006, the company had commissioned tests to detect Salmonella Enteriditis in its layer barns and in the organs of its layer hens, that the results came back positive on 47 percent of the days tested, and that the frequency of positive test results grew in the months leading up to the August 2010 recall.  As part of the memorandum, the government also argued that the evidence indicated that Quality Egg personnel took steps to conceal from regulators and customers the company’s failures to follow food safety standards and practices, that Quality Egg created food safety plans that included inaccurate claims about the company’s biosecurity and pest control practices, and that Quality Egg falsified documents for the food safety audits required by various customers. 

Quality Egg pleaded guilty to bribing an inspector of the U.S. Department of Agriculture (USDA) to release eggs that had been retained for quality issues.  Quality Egg acknowledged that, on at least two occasions in 2010, its employees gave a cash bribe to a USDA inspector.  The USDA inspector’s job responsibilities included inspecting shell eggs at one or more of Quality Egg’s production facilities in Iowa.  Quality Egg admitted that its employees provided the bribe to the USDA inspector (now deceased) in an attempt to corruptly influence the inspector to exercise his authority to release pallets of retained eggs for sale without re-processing the eggs as required by law and USDA standards.  The eggs had been retained or “red tagged” for failing to meet minimum USDA quality grade standards.  Former Quality Egg employee Tony Wasmund, 64, of Willmar, Minnesota, pleaded guilty in September 2012 to one count of conspiracy to bribe a public official, sell restricted eggs with intent to defraud and introduce misbranded food into interstate commerce with intent to defraud and mislead.  Wasmund is scheduled to be sentenced by U.S. District Court Judge W. Bennett on May 15 at 8:30 a.m.

Quality Egg also pleaded guilty to introducing misbranded eggs into interstate commerce with the intent to defraud.  As part of its plea agreement, Quality Egg admitted that, beginning no later than January 2006 and continuing through Aug. 12, 2010, its employees affixed labels to egg shipments that indicated false expiration dates with the intent to mislead state regulators and retail egg customers regarding the true age of the eggs.  Quality Egg acknowledged that there were a number of ways that the company mislabeled older eggs with newer processing and expiration dates prior to shipping the eggs to customers in California, Arizona and other states.  Sometimes Quality Egg personnel did not put any processing or corresponding expiration dates on the eggs when they were processed.  The eggs would be kept in storage for several days or up to several weeks.  Then, just prior to shipping the eggs, Quality Egg personnel labeled the eggs with processing dates that were false in that the dates were more recent than the dates that the eggs had actually been processed and with corresponding false expiration dates. 

The case was prosecuted by Assistant U.S. Attorney Peter Deegan of the Northern District of Iowa and Trial Attorneys Lisa Hsiao and Christopher Parisi of the Civil Division’s Consumer Protection Branch.  They were assisted by Associate Chief Counsel Michael Varrone of the Department of Health and Human Services’ Office of General Counsel’s Food and Drug Division.  The case was investigated by FDA’s Office of Criminal Investigations, the USDA’s Office of Inspector General and the FBI.

Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.  The case file number is 14-CR-3024.

Source: justice.gov

Defendant Worked on Unsuccessful Campaign of Washington, D.C., Council Candidate

Washington, DC--(ENEWSPF)--April 13, 2015.  A 33-year-old Washington, D.C., man was sentenced today to serve 16 months in prison for evading income taxes and violating campaign finance laws while working as the treasurer and custodian of records for a District of Columbia political campaign.

The sentence was announced by Acting U.S. Attorney Vincent H. Cohen Jr. of the District of Columbia, Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division, Chief Cathy L. Lanier of the Metropolitan Police Department and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service-Criminal Investigation’s (IRS-CI) Washington, D.C., Field Office.

Hakim J. Sutton pleaded guilty on Oct. 23, 2014, in the U.S. District Court for the District of Columbia to one count of income tax evasion, a federal offense, and one count of knowingly filing a false and misleading campaign finance report, a violation of District of Columbia law.  He was sentenced by the Honorable U.S. District Judge Richard J. Leon.  Under the plea agreement, Sutton is required to pay full restitution of $18,231 in taxes and interest to the IRS.  Sutton was also ordered to three years of supervised release following his 16 month prison sentence.

According to a statement of offense, signed by the defendant as well as the government, Sutton was the principal owner of the Sutton Group, which performed political consulting services in the District of Columbia and elsewhere.  In 2011 and 2012, Sutton served as the treasurer and custodian of records for the campaign of Michael A. Brown, a candidate seeking re-election to an at-large seat on the Council of the District of Columbia.  Brown ultimately lost in the November 2012 election.

Between July 2011 and May 2012, Sutton diverted approximately $115,250 from the campaign bank account to himself by depositing the funds drawn from the campaign bank account into his own personal bank accounts, and converting funds drawn from the campaign bank account to cash.  All told, Sutton wrote 36 checks payable to himself.

According to the statement of offense, some, but not all, of the money that Sutton diverted was compensation for Sutton’s work on the campaign.  However, Sutton failed to file income tax returns for calendar years 2011 and 2012.  He owes a total of $17,180 in federal income taxes for those years, along with an additional $1,051 in interest.

Sutton also omitted references to the checks that he had written to himself in a series of six reports he filed in 2011 and 2012 with the District of Columbia Office of Campaign Finance.

Acting Assistant Attorney General Ciraolo and Acting U.S. Attorney Cohen commended the Metropolitan Police Department and the special agents of IRS-Criminal Investigation, who investigated the case, and Assistant U.S. Attorney David A. Last and former Assistant U.S. Attorney Bryan Seeley of the District of Columbia and Trial Attorney Kenneth C. Vert of the Tax Division, who prosecuted the case.  Ciraolo and Cohen thanked Assistant U.S. Attorney Anthony Saler of the Asset Forfeiture and Money Laundering Section, Legal Assistant Angela Lawrence, Paralegal Specialist Tasha Harris, former Paralegal Specialist Nicole Wattelet and Criminal Investigator John Marsh, all of the U.S. Attorney’s Office for the District of Columbia, for their assistance.

Source: justice.gov

Washington, DC--(ENEWSPF)--April 13, 2015.  One former security guard for Blackwater USA was sentenced today to a term of life in prison, and three others were each sentenced to prison terms of 30 years and one day for their roles in the Sept. 16, 2007, shooting at Nisur Square in Baghdad, that resulted in the killing of 14 unarmed civilians and the wounding of numerous others.

The sentencing, in the U.S. District Court for the District of Columbia, was announced by the U.S. Attorney’s Office for the District of Columbia and Andrew G. McCabe, Assistant Director in Charge of the FBI’s Washington Field Office.

The defendants are Nicholas Abram Slatten, 31, of Sparta, Tennessee; Paul Alvin Slough, 35, of Keller, Texas; Evan Shawn Liberty, 32, of Rochester, New Hampshire; and Dustin Laurent Heard, 33, of Maryville, Tennessee.  All were found guilty by a jury on Oct. 22, 2014, following a two and one-half-month trial.  They were sentenced by the Honorable Senior Judge Royce C. Lamberth of the District of Columbia.

Slatten, who was accused of firing the first shots, was sentenced to life in prison.  The jury had found him guilty of one count of first-degree murder.

Slough, Liberty and Heard were each sentenced to prison terms of 30 years and one day.  The jury had found Slough guilty of 13 counts of voluntary manslaughter, 17 counts of attempted manslaughter and one firearms offense.  Liberty was found guilty of eight counts of voluntary manslaughter, 12 counts of attempted manslaughter and one firearms offense.  Heard was found guilty of six counts of voluntary manslaughter, 11 counts of attempted manslaughter and one firearms offense.

At a day-long sentencing hearing, Judge Lamberth said that the sentences reflected the seriousness of the crimes and the large number of victims.  He said that the U.S. government “should be commended for finding and exposing the truth of what happened in Nisur Square.”

In a statement, the U.S. Attorney’s Office said the prosecution reflected the commitment of the American justice system to the rule of law and expressed hope that the sentencing of the four defendants will bring some comfort to survivors of the shootings and the family members of those who died or were injured.  “In killing and maiming unarmed civilians, these defendants acted unreasonably and without justification,” the statement said.  “In combination, the sheer amount of unnecessary human loss and suffering attributable to the defendants’ criminal conduct on Sept.16, 2007, is staggering.”

“These sentencings are the result of the enduring resolve by law enforcement to protect victims of violent crime,” said Assistant Director in Charge McCabe.  “Because this crime scene was so large and required international travel, both by witnesses and by investigators, this case required a tremendous amount of resources, time and investigative expertise.  The results of this case demonstrate that the FBI will investigate violations of U.S. law no matter where they occur in order to bring justice to innocent victims.”

Another Blackwater security guard, Jeremy P. Ridgeway, pleaded guilty in December 2008 to voluntary manslaughter and attempt to commit manslaughter.  Ridgeway, who testified as a government witness in the trial, has not yet been sentenced.

The defendants worked for Blackwater USA, a private security contractor that was paid by the U.S. government to provide protective services to U.S. officials.

The trial began June 17, 2014.  Over the next 10 weeks, the government presented testimony from 71 witnesses, including 30 from Iraq.  This represented the largest group of foreign witnesses ever to travel to the United States for a criminal trial.  The witnesses included 13 people who were wounded in the shootings, as well as relatives of many of those who died.  The government’s witnesses also included nine members of “Raven 23,” the Blackwater team that was on the scene on the day of the shootings.

According to the government’s evidence, at approximately noon on Sunday, Sept. 16, 2007, several Blackwater security contractors, including the four defendants, opened fire in and around Nisur Square, a busy traffic circle in the heart of Baghdad.  When they stopped shooting, 14 Iraqi civilians were dead.  Those killed included 10 men, two women and two boys, ages 9 and 11.  Another 18 victims were injured.

The four defendants and 15 other Blackwater security contractors were assigned to a convoy of four heavily-armed trucks known as a Tactical Support Team, using the call sign “Raven 23.”  Shortly before noon, Raven 23 learned that a car bomb had detonated in central Baghdad near a location where a U.S official was being escorted by a Blackwater personal security detail team.  Raven 23 team members promptly reported to their convoy vehicles, and the convoy drove to a secured checkpoint between the Green Zone and Red Zone.

Once there, in disregard of an order from Blackwater’s command, the team’s shift leader directed Raven 23 to leave the Green Zone and establish a blockade in Nisur Square, a busy traffic circle that was immediately adjacent to the Green Zone.  While occupying the southern part of the traffic circle, seven of the 19 members of Raven 23, including the four defendants and Ridgeway fired their weapons resulting in the deaths or injury of the unarmed Iraqi civilians there.  While leaving the traffic circle, Slough continued to fire his weapon resulting in additional deaths and injuries.

Finally, further away, north of the traffic circle, Slough and Ridgeway again fired their weapons resulting in the injury of three more unarmed Iraqi civilians.

The first to be killed was Ahmed Haithem Ahmed Al Rubia’y, 21, an aspiring doctor, who was driving his mother to an appointment.  His mother, Mahassin Mohssen Kadhum Al-Khazali, 44, a medical doctor, also was killed.  Others who died included Ali Mohammed Hafedh Abdul Razzaq, 9, who was traveling with his family; Osama Fadhil Abbas, 52, a businessman who sold used cars and who was enroute to a business meeting; Mohamed Abbas Mahmoud, 47, a delivery truck driver, and his 11-year-old son, Qasim Mohamed Abbas Mahmoud; Sa’adi Ali Abbas Alkarkh, 52, a businessman; Mushtaq Karim Abd Al-Razzaq, 18, an Iraqi soldier who was standing at a military checkpoint; Ghaniyah Hassan Ali, 55, who was traveling with her daughter on a public bus, and who was in the area to get documentation for a trip to holy sites; Ibrahim Abid Ayash, 77, a gardener, who was traveling in another bus; Hamoud Sa’eed Abttan, 33, and his cousin, Usday Ismail Ibrahiem, 27, who were out looking for work with the Iraqi Army; Mahdi Sahib Nasir, 26, a taxi driver, and Ali Khalil Abdul Hussein, 54, a motorcyclist who was commuting to work.

The jury considered charges involving injuries to 14 men and three women.   Because of travel issues, witnesses to support an 18^th charge of attempted manslaughter did not appear at the trial and the charge related to that victim’s injuries was dismissed by the government. 

This case was investigated by the FBI’s Washington Field Office.  The Iraqi Ministry of Interior and the Iraqi National Police provided cooperation and assistance in the investigation.

The case was prosecuted by Special Assistant U.S. Attorneys Anthony Asuncion, Christopher R. Kavanaugh and T. Patrick Martin, and Assistant U.S. Attorneys John Crabb Jr. and David Mudd, of the National Security Section of the U.S. Attorney’s Office of the District of Columbia.  The case was originally indicted by Assistant U.S. Attorneys Jonathan M. Malis and Kenneth Kohl of the District of Columbia.

Source: justice.gov

Washington, DC—(ENEWSPF)—April 14, 2015. The U.S. Department of Justice’s Office of Community Oriented Policing Services (COPS Office) today announced the start of the Collaborative Reform Initiative for Technical Assistance (CRI-TA) with the Calexico Police Department in California.

“The COPS Office will conduct a thorough, independent assessment of the Calexico Police Department’s policies, practices and responsiveness to the community to ensure that they are taking into account national standards and community expectations,” said COPS Office Director Ronald Davis.  “Through this process, the Justice Department is committed to identifying organizational deficiencies, recommending best practices and providing technical assistance to help strengthen the Calexico Police Department.”  

The COPS Office’s CRI-TA is an independent and objective way to transform a law enforcement agency through an analysis of policies, practices, training, tactics and accountability methods around key issues facing law enforcement today.  The initiative is designed to provide technical assistance to agencies facing significant law enforcement-related issues.  Using subject matter experts, interviews and direct observations, as well as conducting extensive research and analysis, the COPS Office assists law enforcement agencies in enhancing and improving their policies and procedures, operating systems and professional culture.

The COPS Office is currently providing CRI-TA in Spokane, Washington; Philadelphia; St. Louis; Baltimore; Salinas, California; and Fayetteville, North Carolina, and has completed the process in Las Vegas.

The COPS Office, headed by Director Ronald Davis, is a federal agency responsible for advancing community policing nationwide.  Since 1995, the COPS Office has awarded more than $14 billion to advance community policing, including grants awarded to more than 13,000 state, local and tribal law enforcement agencies to fund the hiring and redeployment of more than 126,000 officers and provide a variety of knowledge resource products including publications, training and technical assistance.  For additional information about the COPS Office, please visit the office’s website.

Source: justice.gov

Washington, DC—(ENEWSPF)—April 14, 2015. A South Florida Doctor was charged in a seventy-six count indictment for participating in a Medicare fraud scheme, announced U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the  FBI’s Miami Field Office, Special Agent in Charge Shimon Richmond of the U.S. Department of Health and Human Services Office of the Inspector General’s Miami Region (HHS-OIG), Special Agent in Charge Michael D. Angelucci of the U.S. Railroad Retirement Board’s Office of Inspector General (RRB) and Special Agent in Charge John Khin of the Defense Criminal Investigative Service (DCIS).

According to the indictment, Melgen was an ophthalmologist and retina specialist licensed to practice medicine in the state of Florida, who owned and operated Vitreo-Retinal Consultants of the Palm Beaches (VRC), a medical clinic that was incorporated in 1990.  VRC conducted business as “Vitreo Retinal Consultants Eye Center” and “The Melgen Retina Eye Center” and had four offices located in Palm Beach and St. Lucie Counties.  Melgen’s high-volume medical practice provided services to as many as 100 patients or more in a single day.  A large percentage of Melgen’s patients were Medicare beneficiaries. 

The indictment alleges that from as early as 2004 and continuing through at least Dec. 31, 2013, Melgen participated in a scheme to defraud Medicare and other health care benefit programs, by submitting false claims and creating fraudulent entries on patients’ medical charts.  Melgen is alleged to have falsely diagnosed patients with serious eye conditions, notably age-related macular degeneration (ARMD or AMD) and retinal disorders.  Macular degeneration is a disease of the retina that is one of the leading causes of severe vision loss in persons age 65 and older.  There are two forms of ARMD, “dry” and “wet.”  In patients with dry macular degeneration, the cells of the central area of the retina (the macula) break down, causing distorted and blurred vision.  In wet macular degeneration, abnormal blood vessels leak blood and fluid into the macula, causing scarring and rapid loss of vision.  Without treatment, wet ARMD can lead to permanent vision loss.  Based upon the false diagnoses, the defendant would allegedly perform and bill for medically unreasonable and unnecessary tests and procedures, which included unnecessary laser surgeries and eye injections.

The defendant is also alleged to have made exorbitant and improper profits from the purchase and administration of the drug Lucentis, which is used for the treatment of wet macular degeneration.  The defendant would purchase the drug from the manufacturer, Genentech, arrange to have the “single-use” vials split into multiple doses and administered to multiple patients, and then separately bill Medicare and other health care providers at the reimbursement rate for each full dosage.

The defendant is also alleged to have caused patient files to contain false information, including the false diagnoses as well as fictitious drawings and diagrams that misrepresented the condition of the patients’ eyes.  The indictment also alleges that the defendant prepared false and fictitious reports regarding his abnormal billing practices, in response to audit inquiries from Medicare.

Additionally, the defendant allegedly submitted claims for incomplete and non-performed diagnostic tests, such as angiographic studies on blind eyes and prosthetic eyes.

The indictment further charges that, between January 2008 and December 2013, the defendant billed the Medicare program more than $190 million, for which he, through VRC, was reimbursed and paid more than $105 million.  A substantial portion of these reimbursement payments were allegedly obtained through fraudulent billing.  

“Medicare was created to ensure adequate protection for the senior citizens against the cost of health care and to ensure that they are provided with quality medical services,” said U.S. Attorney Ferrer.  “Medical professionals who violate their oath by failing to attend to the health of their patients and who submit falsified billing statements for their own personal gain, jeopardize the viability of government benefit programs.  Our office will continue to work with all involved agencies to protect our senior citizens, prosecute those individuals who perpetuate the fraudulent schemes and help preserve precious Medicare dollars for the intended beneficiaries – the poor, sick and elderly.”

“People who defraud Medicare indirectly increase the cost of health care for everyone,” said Special Agent in Charge Piro.  “The FBI and our law enforcement partners are committed to rooting out this kind of fraud and reclaiming money that was dishonestly obtained.”

“Patients fearing blindness sought treatment from Dr. Melgen’s office,” said Special Agent in Charge Richmond.  “Instead, they allegedly received medically unreasonable and unnecessary tests and procedures for which they and taxpayers paid millions of dollars.  My office will continue to work with our law enforcement partners to ensure the integrity of the Medicare program.”

“The Office of Inspector General for U.S. Railroad Retirement Board will continue to work with our law enforcement partners to investigate and prosecute any individual that defrauds the Medicare system,” said Special Agent in Charge Angelucci.

"Today's indictment is part of an ongoing effort by the Defense Criminal Investigative Service (DCIS) and its law enforcement partners to protect the integrity of federal health care programs and the quality of care our military service members receive,” said Special Agent in Charge Khin.  “DCIS will tirelessly pursue allegations of health care fraud that put the Warfighter at risk and burden the Defense Health Agency with unnecessary costs."

Melgen is scheduled to be arraigned on the indictment on April 15, 2015, in West Palm Beach, Florida, before U.S. Magistrate Judge James M. Hopkins of the Southern District of Florida.

U.S. Attorney Ferrer commended the investigative efforts of the FBI, HHS-OIG, RRB and DCIS.  This case is being prosecuted by Assistant U.S. Attorneys Roger H. Stefin, Carolyn Bell and Alexandra Chase of the Southern District of Florida.

An indictment is only an accusation and the defendant is presumed innocent unless and until proven guilty.

A copy of this press release may be found on the website of the U.S. Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls.  Related court documents and information may be found on the website of the U.S. District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

Source: justice.gov

Washington, DC—(ENEWSPF)—April 14, 2015. A federal grand jury in West Palm Beach, Florida, returned a two-count indictment charging Palm Beach County Sheriff’s Deputy William D. Wheeler, 46, with unlawfully assaulting a man at the Palm Beach County Detention Center on Oct. 9, 2013, and filing a false report on the incident, announced Principal Deputy Assistant Attorney General Vanita Gupta of the Civil Rights Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida and Special Agent in Charge George L. Piro of the FBI.

According to the allegations contained in court documents, on or about Oct. 9, 2013, Wheeler was employed as a Palm Beach County Sheriff’s Office Deputy and was assigned to the Corrections Division (PBSO) West Detention Center located in Belle Glade, Florida.  As part of his duties, the complaint alleges that Wheeler escorted an inmate, J.S., to the medical area of the facility where he was seated in a chair with his hands restrained behind his back with handcuffs.  The complaint alleges that J.S. did not comply with the treating nurse’s attempt to review his medical bracelet.  The complaint further alleges that as the defendant lifted the inmate’s arm to read the medical bracelet, the inmate pulled his arm away.  The complaint alleges that Wheeler then placed his hands around the inmate’s neck, struck the inmate’s head against the wall and pulled the inmate to the floor.  The complaint further alleges that the defendant then struck the inmate in the face with his knee.  The inmate sustained facial injuries as a result of the incident, which was allegedly captured on a video recording.  

According to the complaint, the defendant prepared an incident report regarding the use of force.  The complaint further alleges that the defendant was later questioned regarding the incident and claimed to have been physically assaulted by the inmate.  The complaint alleges that the defendant’s version of the events is not corroborated by the video footage.

If convicted, Wheeler faces a maximum punishment of 30 years in prison.  An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.

This case commends the investigative efforts of the West Palm Beach Resident Agency of the FBI, Ric Bradshaw of the Palm Beach County Sheriff’s Office and State Attorney Dave Aronberg of the Palm Beach County State Attorney’s Office.  It is being prosecuted by Trial Attorney D.W. Tunnage of the Justice Department’s Civil Rights Division and Assistant U.S. Attorney Susan Osborne of the Southern District of Florida.

Related Material:

Wheeler Indictment

Source: justice.gov

Seven Foreign Nationals and Companies Placed on Department of Commerce’s Entity List

Washington, DC—(ENEWSPF)—April 17, 2015. A 24-count indictment has been unsealed today charging four corporations and five individuals with facilitating the illegal export of high-tech microelectronics, uninterruptible power supplies and other commodities to Iran in violation of the International Emergency Economic Powers Act (IEEPA). 

The announcement was made by Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Kenneth Magidson of the Southern District of Texas, Assistant Director Randall Coleman of the FBI’s Counterintelligence Division, Special Agent in Charge Perrye K. Turner of the FBI’s Houston Field Office, Under Secretary of Commerce Eric L. Hirschhorn of the Department of Commerce, Special Agent in Charge Tracy E. Martin of the Department of Commerce’s Office of Export Enforcement’s Dallas Field Office and Special Agent in Charge Lucy Cruz of the IRS’ Houston Field Office. 

“The nine defendants charged in the indictment allegedly circumvented U.S. sanctions and illegally exported controlled microelectronics to Iran,” said Assistant Attorney General Carlin.  “Violations of the International Emergency Economic Powers Act not only can undercut the impact of U.S sanctions, but can also serve to undermine U.S. foreign policy and adversely affect national security.  I want to thank all those in law enforcement whose tireless efforts led to these charges.”

“The prevention, investigation and prosecution of the illegal export of critical electronic system is one of the highest priorities of the Department of Justice,” said U.S. Attorney Magidson.  “This indictment is evidence of our commitment to ensuring that our laws are enforced and our national security is protected.” 

“The proliferation of sensitive U.S. technologies to Iran and the direct support to their military and weapons programs remains a clear threat to U.S. national security,” said Coleman.  “The FBI and our interagency partners will continue to identify, penetrate and neutralize proliferation efforts aimed at circumventing our export control laws and economic sanctions to illegally obtain sensitive technologies.”

“IRS-CI will tenaciously pursue individuals who violate international emergency economic powers statutes,” said Special Agent in Charge Cruz.  “Our role is to unravel the often concealed or disguised financial crimes that threaten our national security.”

“The Office of Export Enforcement and our law enforcement partners will continue to investigate, pursue and dismantle these procurement networks that violate U.S. export control laws whether they operate within our borders or anywhere else in the world,” said Special Agent in Charge Martin.

The indictment alleges Houston-based company Smart Power Systems Inc. (SPS); Bahram Mechanic, 69, and Tooraj Faridi, 46, both of Houston; and Khosrow Afghahi, 71, of Los Angeles, were all members of an Iranian procurement network operating in the United States.  Also charged as part of the scheme are Arthur Shyu, and the Hosoda Taiwan Limited Corporation in Taiwan; Matin Sadeghi, 54, and Golsad Istanbul Trading Ltd. in Turkey; and the Faratel Corporation, co-owned by Mechanic and Afghahi in Iran.

The indictment was returned under seal on April16, 2015, and unsealed as Mechanic and Faridi made their initial appearances before U.S. Magistrate Judge Francis H. Stacy of the Southern District of Texas.  Afghahi was taken into custody and will make an initial appearance in the Central District of California.  Sadeghi and Shyu are believed to be out of the country and warrants remain outstanding for their arrests.  Anyone with information is asked to contact the nearest embassy or local FBI office.  They may also contact the FBI’s Houston Office at 713-693-5000.

In conjunction with the unsealing of these charges, the Department of Commerce is designating seven foreign nationals and companies, adding them to its Bureau of Industry and Security Entity List.  The indictment alleges these individuals and companies received, transshipped or otherwise facilitated the illegal export of controlled commodities by the defendants.  Designation on the Entity List imposes a license requirement before any commodities can be exported from the United States to these persons or companies and establishes a presumption that no such license will be granted. 

The Entity List identifies foreign parties that are prohibited from receiving some or all items subject to the Export Administration Regulations (EAR) unless the exporter secures a license. Those persons present a greater risk of diversion to weapons of mass destruction (WMD) programs, terrorism or other activities contrary to U.S. national security or foreign policy interests. BIS can add to the Entity List a foreign party, such as an individual, business, research institution or government organization, for engaging in activities contrary to U.S. national security and/or foreign policy interests. In most instances, license exceptions are unavailable for the export, re-export or transfer (in-country) to a party on the Entity List of items subject to the EAR. Rather, a prior license is required, usually subject to a policy of denial.

According to the indictment, Mechanic and Afghahi are the co-owners of Iran-based Faratel and its Houston-based sister company SPS.  Faratel designs and builds uninterruptible power supplies for various Iranian entities, including Iranian government agencies such as the Iranian Ministry of Defense, the Atomic Energy Organization of Iran, and the Iranian Centrifuge Technology Company.  SPS designs and manufactures uninterruptible power supplies in cooperation with Faratel.  Faridi currently serves as a vice president of SPS.  Shyu is a senior manager at the Hosoda Tawain Limited Corporation, a trading company located in Taiwan, while Sadeghi is an employee of Golsad Istanbul Trading, a shipping company located in Turkey.

The indictment alleges that between approximately July 2010 and the present, Mechanic and the others engaged in a conspiracy to obtain various commodities, including controlled United States-origin microelectronics.  They then allegedly exported these to Iran, while carefully evading the government licensing system set up to control such exports.  The microelectronics shipped to Iran allegedly included microcontrollers and digital signal processors.  According to the indictment, these commodities have various applications and are frequently used in a wide range of military systems, including surface-air and cruise missiles.  Between July 2010 and the present, Mechanic’s network allegedly sent at least $24 million worth of commodities to Iran.

According to court documents, Mechanic, assisted by Afghahi and Faridi, regularly received lists of commodities, including United States-origin microelectronics, sought by Faratel in Iran.  Mechanic would approve these orders and then send the orders to Shyu in Taiwan, according to the indictment.  Shyu would allegedly purchase the commodities utilizing Hosoda Taiwan Limited and then ship the commodities to Turkey, where Sadeghi would act as a false buyer via his company, Golsad Istanbul Trading Ltd.  The indictment further alleges that Sadeghi would receive the commodities from Shyu and then ship them to Faratel in Iran.  Mechanic required his co-conspirators to notify him and obtain his approval for each of the transactions completed by the network, according to the allegations.

The individual defendants each face up to 20 years in federal prison, while the corporate defendants face fines of up to $1 million for each of the IEEPA counts, upon conviction.

Mechanic, Afghahi and Shyu are also charged with conspiring to commit money laundering and substantive money laundering violations, each charge carries a maximum potential term of imprisonment of 20 years.  Mechanic further faces a charge of willful failure to file foreign bank and financial accounts for which he faces up to five years in federal prison.  The charges also carry the possibility of substantial fines upon conviction.

The government’s case is being prosecuted by Assistant U.S. Attorneys S. Mark Mcintyre and Craig Feazel of the Southern District of Texas, as well as Trial Attorneys Casey Arrowood and Matt Walczewski of the Justice Department’s National Security Division.

In all cases, defendants are presumed innocent until and unless proven guilty.  The indictment merely contains allegations of criminal activity. 

Related Material:

IEEPA Indictment

Source: justice.gov

Washington, DC—(ENEWSPF)—April 17, 2015. Brian Karl Brimager, 37, prior boyfriend of murdered Los Angeles woman Yvonne Baldelli, was indicted by a federal grand jury in San Diego, California, today on first degree murder charges.  Brimager was arraigned in court on the superseding indictment and pleaded not guilty.

Brimager has been in U.S. custody since June 2013 on charges of obstruction of justice, giving false statements to a federal officer and falsifying records all related to the same murder investigation. 

According to the indictment in September 2011, Brimager and Baldelli moved together from Los Angeles, California, to the archipelago of Bocas del Toro, Panama.  They rented a room in a small five-unit hostel on Isla Carenero, a small island near Bocas reachable only by boat.  Almost immediately upon arrival Brimager began emailing another girlfriend, the mother of his young daughter.  In these emails, Brimager discussed plans to move back to California to live with this other girlfriend and help raise their daughter.  The emails did not mention Baldelli.

As revealed in the charging document, at the same time he was emailing the other girlfriend, Brimager began physically abusing Baldelli.  Among other damage, these beatings caused bruises around Baldelli’s eyes and on her arms.  The indictment alleges that around Nov. 26, 2011, Brimager murdered Baldelli, dismembered her body and disposed of her body parts in a remote jungle area on Isla Carenero.  Following her murder, Brimager engaged in an elaborate scheme to cover up the crime.  This scheme included destroying evidence, giving false information to law enforcement and sending a series of emails purportedly from Baldelli in order to make it appear to her friends and family that she was still alive.

According to the indictment, Brimager created a cover story to explain Baldelli’s whereabouts and, in the days and months that followed, engaged in a series of obstructive acts designed to back up his story.  For example, Brimager, using Baldelli’s laptop, sent emails to Baldelli’s family and friends from her personal email account, in which he purported to be Baldelli.  These emails, among other things, falsely claimed that Baldelli was alive and living in Costa Rica with another man.  To corroborate this story, Brimager, after murdering Baldelli, withdrew money from her bank accounts at an ATM to make it appear that she was on her way to Costa Rica.  He further attempted to substantiate his cover story by making another withdrawal from Baldelli’s bank accounts when he travelled through Costa Rica on his way back to the U.S.

The indictment also alleges that Brimager attempted to conceal his crime by disposing of a bloody mattress involved in Badelli’s murder in the ocean.  According to the indictment, within a few hours of murdering Baldelli and prior to dumping the mattress in the ocean, Brimager conducted two internet searches on Baldelli’s computer, one for “washing mattress” and a second for “washing mattress blood stain.”

The indictment also charges Brimager with making materially false statements to the FBI during an interview on March 21, 2012.  The indictment alleges that Brimager falsely stated that Baldelli took her white Sony VAIO laptop with her when she left Panama, when in fact, the laptop was found in Brimager’s possession on March 21, 2012, months after Baldelli’s murder.

Baldelli’s skeletal remains were not found in the jungle until almost two years after her murder.  

The case was prosecuted by Assistant U.S. Attorneys W. Mark Conover and Shane P. Harrigan.

Source: justice.gov

Four Defendants Arrested in Minneapolis; Two Arrested in San Diego

Washington, DC--(ENEWSPF)--April 20, 2015. A criminal complaint was filed today charging six Minnesota men with conspiracy and attempt to provide material support to a designated foreign terrorist organization, namely, the Islamic State of Iraq and the Levant (ISIL).  

Zacharia Yusuf Abdurahman, 19, Adnan Farah, 19, Hanad Mustafe Musse, 19, and Guled Ali Omar, 20, were arrested in Minneapolis yesterday.  Abdirahman Yasin Daud, 21, and Mohamed Abdihamid Farah, 21, were arrested yesterday in California after driving from Minneapolis to San Diego.

Assistant Attorney General for National Security John P. Carlin, U.S. Attorney Andrew M. Luger of the District of Minnesota and Special Agent in Charge Richard T. Thornton of the FBI’s Minneapolis Division made the announcement.

“The six defendants charged in the complaint allegedly planned to travel to Syria as part of their conspiracy to provide material support to ISIL,” said Assistant Attorney General Carlin.  “One of the National Security Division’s highest priorities is to identify, disrupt, and hold accountable those who provide or attempt to provide material support to designated foreign terrorist organizations.  I would like to thank the many agents, analysts, and prosecutors who are responsible for this investigation and the charges in this case.”

“As described in the criminal complaint, these men worked over the course of the last 10 months to join ISIL,” said U.S. Attorney Luger.  “Even when their co-conspirators were caught and charged, they continued to seek new and creative ways to leave Minnesota to fight for a terror group.  I applaud the hard work and tireless efforts of the FBI Minneapolis Division and their colleagues around the country.”

“Preventing acts of terrorism is the FBI's highest priority,” said Special Agent in Charge Thornton.  “Disrupting individuals from traveling to join and fight for ISIL is an important part of our counter terrorism strategy.  As a result of this investigation and arrests, these six Minnesota men who planned to travel and fight for ISIL will answer these charges in U.S. District Court instead of taking up arms in Syria.  The FBI remains committed to ending both recruitment efforts and travel on the part of young people from Minnesota to fight overseas on behalf of terror groups.  These arrests today signify this continued commitment.”

According to the criminal complaint and documents filed in court, the FBI has been conducting an investigation for the last 10 months into a group of individuals who have tried to join – and in some cases succeeded in joining – overseas designated foreign terrorist organizations.  At least nine Minnesotans have now been charged as part of this conspiracy to provide material support to ISIL.  The men are all alleged associates and friends of one another.

This case is the result of an investigation conducted by the FBI-led Joint Terrorism Task Force, U.S. Attorney’s Office of the District of Minnesota and the Counterterrorism Section of the Department of Justice National Security Division.  Assistant Attorney General Carlin is also grateful to the U.S. Attorney’s Office of the Southern District of California and the FBI’s San Diego Division for their contributions to the investigation of this case.

The charges contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

Related Material:

Farah et al Criminal Complaint

Source: justice.gov

Defendant Attempted to Travel to Yemen to Join al-Qaeda Affiliate, Assist Co-Conspirator’s Efforts to Join The Terrorist Group and Destroy Evidence of Terrorism Offenses

Washington, DC--(ENEWSPF)--April 20, 2015.  Earlier today at the federal courthouse in Central Islip, New York, Marcos Alonso Zea, also known as “Ali Zea,” an American citizen and resident of Brentwood, New York, was sentenced to 25 years in prison following his Sept. 9, 2014, guilty plea to attempting to provide material support to a foreign terrorist organization, al-Qaeda in the Arabian Peninsula, also known as Ansar al-Sharia (collectively AQAP), and obstruction of justice.

The sentencing was announced by U.S. Attorney Loretta E. Lynch of the Eastern District of New York, Assistant Attorney General for National Security John P. Carlin, Assistant Director in Charge Diego Rodriguez of the FBI’s New York Field Office and Commissioner William J. Bratton of the New York Police Department (NYPD).

Beginning in the fall of 2011, Zea planned to travel overseas in order to wage violent jihad against the perceived enemies of Islam, which included the government of Yemen and its allies.  In furtherance of his plot, on Jan. 4, 2012, Zea boarded a flight at John F. Kennedy Airport (JFK) in Queens, New York, to London, en route to Yemen.  Zea was not permitted to travel onward from London, however, and was returned to the United States by British authorities.  Zea was interviewed and closely monitored by investigators following his return.  Despite being prevented from traveling to Yemen, Zea continued to plot, including by encouraging and supporting his co-conspirator, Justin Kaliebe, who also was planning to travel to fight jihad.  In January 2013, Kaliebe was arrested at JFK while attempting to travel to Yemen to join AQAP.  Months later, after learning that he too was under investigation, Zea caused electronic media on his computer to be destroyed in an effort to obstruct the investigation.  Notwithstanding his efforts, a forensic examination of Zea’s electronic media subsequently conducted by investigators revealed an assortment of violent Islamic extremist materials, including issues of Inspire magazine, part of AQAP’s English-language media operations.

“Marcos Alonso Zea presents a chilling reminder of the danger presented to the United States by homegrown terrorists,” said U.S. Attorney Lynch.  “Born, raised and schooled in the United States, the defendant nevertheless betrayed his country by attempting to join al-Qaeda in the Arabian Peninsula, assisting a co-conspirator’s attempt to join that terrorist group, and, after learning he was under investigation, attempting to destroy evidence of his guilt.  We will continue to work tirelessly to protect our national security from all enemies, both foreign and domestic.”  U.S. Attorney Lynch expressed her grateful appreciation to all the members of the FBI’s Joint Terrorism Task Force and the NYPD’s Intelligence Division for their work on the investigation.

“One of our highest priorities is to protect our country by identifying, disrupting and holding accountable those who provide or attempt to provide material support to designated foreign terrorist organizations,” said Assistant Attorney General Carlin.  “This sentence serves unambiguous notice that attempting to travel abroad to engage in such conduct has significant consequences.”

“The threat from al-Qaeda is real, look no further than Marcos Zea,” said Assistant Director in Charge Rodriguez.  “Zea betrayed our country, attempting to first join al-Qaeda.  When that failed, he helped others wage jihad.  We continue working relentlessly to disrupt the plans of those who look to do us harm.”

“The New York City Police Department will continue to work closely with our federal counterparts to identify and arrest homegrown terrorists like Marcos Alonso Zea, and ensure all extremists bring no harm to American soil, especially here in New York City,” said Commissioner Bratton.

After being arrested in January 2013, Zea’s co-conspirator Kaliebe subsequently pleaded guilty to one count of attempting to provide material support to terrorists and one count of attempting to provide material support to AQAP.  Kaliebe is pending sentencing by U.S. District Judge Denis R. Hurley of the Eastern District of New York.

The case is being prosecuted by Assistant U.S. Attorneys Seth D. DuCharme, John J. Durham and Michael P. Canty of the Eastern District of New York, with assistance provided by Trial Attorney Kelli Andrews of the National Security Division’s Counterterrorism Section.

Source: justice.gov

Sex Trafficking Scheme Used Threats, Violence and Coercion to Compel Women into Prostitution in New Orleans and Elsewhere

Washington, DC--(ENEWSPF)--April 20, 2015.  Today, three additional defendants pleaded guilty in connection with a sex trafficking scheme operated out of the Riviera Motel in New Orleans, Louisiana, which compelled multiple women to engage in prostitution in New Orleans and elsewhere, announced Principal Deputy Assistant Attorney General Vanita Gupta of the Justice Department’s Civil Rights Division and U.S. Attorney Kenneth Allen Polite Jr. of the Eastern District of Louisiana.

Defendants Duane Phillips, 29, and Christopher Williams, 30, both of whom are residents of Memphis, Tennessee, each pleaded guilty today to conspiring to commit sex trafficking of adult victims by force, fraud and coercion in New Orleans and elsewhere.  Defendant Anthony Ellis, 26, also of Memphis, pleaded guilty to one count of conspiring to commit sex trafficking of adult victims and one count of transportation for purposes of prostitution.   

“The Department of Justice will not tolerate trafficking in human beings, and will continue to relentlessly pursue justice on behalf of vulnerable members of our society, whether they are migrants from beyond our borders or whether they are young women from our own communities,” said Principal Deputy Assistant Attorney General Gupta.  “We will continue in our steadfast determination to hold accountable those who use force and coercion to exploit other human beings.”

“These defendants recruited vulnerable victims from the New Orleans community and brought other victims to New Orleans to engage in commercial sex trafficking,” said U.S. Attorney Polite.  “These crimes often pass without detection because victims live in fear from physical abuse, threats and other forms of coercion.  My office is committed to prosecuting individuals who manipulate victims into committing commercial sex acts and profit from this illegal conduct.”

“This investigation and prosecution should serve as a clear reminder to all those individuals engaged in the heinous crime of sex trafficking that the full force of federal law enforcement, across geographical boundaries, will bring them to swift justice,” said Special Agent in Charge Michael Anderson of the FBI’s New Orleans Division.

“Human trafficking is a form of modern-day slavery that Homeland Security Investigations fights as one of its highest priorities via a coordinated global effort with the FBI and our state and local law enforcement partners,” said Acting Special Agent in Charge Cindy M. Johnson of Homeland Security Investigations’ (HSI) New Orleans Field Office.  “The results speak for themselves; over the past two years HSI has doubled its number of human trafficking arrests.  HSI will continue to investigate and seek prosecution of these criminals while also ensuring the victims of this terrible crime are rescued and get the care they need.”

Two defendants have previously pleaded guilty in connection with the case.  On June 25, 2014, defendant Zacchaeus Taylor pleaded guilty to sex trafficking conspiracy and to Transportation for Purposes of Prostitution.  On March 4, 2015, Laquentin Brown pleaded guilty to the same charges.  Each face a maximum of five years on the conspiracy count and a maximum of 10 years on the transportation for prostitution count.

On Oct. 3, 2014, a grand jury in the Eastern District of Louisiana returned a Second Superseding Indictment charging defendants Phillips, Williams and Ellis, along with additional defendants Granville Robinson and Laquentin Brown, with sex trafficking conspiracy and varying counts of sex trafficking and transportation for prostitution.  The Second Superseding Indictment also charged defendant Kanubhai Patel, who was the former owner of the Riviera Motel, with benefitting financially from the sex trafficking conspiracy.  Defendant Taylor was charged separately on March 28, 2014.  Of the seven defendants charged in connection with the sex trafficking scheme, five have entered guilty pleas.  An indictment is merely an accusation and defendants are innocent until proven guilty beyond a reasonable doubt.

During their respective plea hearings and in their respective court filings, defendants Phillips, Williams and Ellis admitted that they, along with co-defendants Robinson and Brown, all of whom are from Memphis, conspired to recruit, groom, force, compel and coerce adult women to engage in prostitution, enforcing rules and means of control that included requiring the women to earn a certain amount of money each day, requiring them to turn over the proceeds and prohibiting them from speaking to or looking at other pimps.  Williams admitted intentionally trying to impregnate women to make it harder for them to leave him, while some of the other defendants took the victims’ identification cards and documents.  To enforce the rules, Phillips, Williams and Ellis each admitted that they and their co-conspirators used a variety of punishments, including withholding food, forcing the victims to engage in additional commercial sex acts, as well as physical assaults.  Williams noted that he attempted to avoid visible bruising so that the victims would not draw the attention of the police or scare off prospective customers.  Phillips, Williams and Ellis each admitted that they and their co-conspirators consulted one another on means of furthering their pimping activities, and would monitor each other’s victims when a co-conspirator was incarcerated.  Phillips, Williams, Ellis and the other co-conspirators frequently stayed at the Riviera Motel because they knew that the hotel staff would not stop them from pimping women.

At sentencing, defendant Ellis faces a maximum sentence of 10 years on the transportation for prostitution charge and a maximum sentence of five years on the conspiracy charge.  Defendants Phillips and Williams each face a maximum sentence of life imprisonment for the sex trafficking conspiracy. 

This case was investigated jointly by agents from the New Orleans Field Offices of the Federal Bureau of Investigation (FBI) and Department of Homeland Security (DHS), with assistance from the FBI’s Memphis Field Office.  This case is being prosecuted by Special Litigation Counsel John Cotton Richmond and Trial Attorney Christine M. Siscaretti of the Civil Right Division’s Human Trafficking Prosecution Unit, and Assistant U.S. Attorney Julia K. Evans of the Eastern District of Louisiana.

Source: justice.gov

Washington, DC—(ENEWSPF)—April 21, 2015. The government has intervened in three False Claims Act lawsuits and filed a consolidated complaint against HCR ManorCare alleging that ManorCare knowingly and routinely submitted false claims to Medicare and Tricare for rehabilitation therapy services that were not medically reasonable and necessary, the Department of Justice announced today.  ManorCare is one of the nation’s largest healthcare providers, operating approximately 281 skilled nursing facilities (SNFs) in 30 states.

“The Department of Justice is committed to ensuring that healthcare providers who pressure their employees to provide medically unnecessary services to Medicare beneficiaries and Tricare recipients solely to increase their own profits are held accountable,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division.  “We will not relent in our efforts to stop these false billing schemes and recover funds for federal healthcare programs.”

The government’s complaint alleges that ManorCare, which is owned by The Carlyle Group, exerted pressure on SNF administrators and rehabilitation therapists to meet unrealistic financial goals that resulted in the provision of medically unreasonable and unnecessary services to Medicare and Tricare patients.  ManorCare allegedly set prospective billing goals designed to significantly increase revenues without regard to patients’ actual clinical needs and threatened to terminate SNF managers and therapists if they did not administer the additional treatments necessary to qualify for the highest Medicare payments.  ManorCare also allegedly increased its Medicare payments by keeping patients in its facilities even though they were medically ready to be discharged.

“We strive for a system whereby health care providers provide reasonable and necessary services without overbilling Medicare for unreasonable and unnecessary services” said U.S. Attorney Dana J. Boente of the Eastern District of Virginia.  “We will continue our robust investigations of the companies operating in this important sector of our economy.”

“We want to ensure that taxpayer dollars are used to pay for health care for Americans that need it, not to unjustly enrich health care companies,” said U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan.  “Medical providers will be held accountable when they exploit patients for profit by subjecting them to therapies they don’t need and then billing Medicare for reimbursement.”

“Today’s action is the result of a robust investigation into alleged false billings submitted to Medicare and Tricare for rehabilitation therapy services that were not necessary for patients,” said Assistant Director in Charge Andrew G. McCabe of the FBI’s Washington, D.C., Field Office.  “Healthcare fraud is a top priority for the FBI and we will continue to work closely with federal, state and local law enforcement partners to address vulnerabilities, fraud and abuse in the healthcare industry.”

The three consolidated lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims for government funds and to receive a share of any recovery.  The False Claims Act permits the government to intervene in such lawsuits, as it has done in these cases.  A defendant that violates the False Claims Act is liable for three times the government’s losses plus civil penalties.

 The government’s intervention in these matters illustrates its emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs.  Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement, including the conduct described in the United States’ complaint, can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).

These matters were investigated by the Civil Division’s Commercial Litigation Branch; the U.S. Attorney’s Offices for the Northern and Southern Districts of Iowa, Eastern and Western Districts of Michigan, Northern and Southern Districts of Ohio, Eastern District of Pennsylvania and Eastern District of Virginia; the Department of Health and Human Services’ Office of Inspector General; the Department of Defense’s Office of Inspector General; the Defense Health Agency; the Medicaid Fraud Control Units of the California Attorney General’s Office, Delaware Department of Justice, the Florida Attorney General’s Office, Illinois State Police, Iowa Department of Inspections and Appeals, the Maryland Attorney General’s Office, the Michigan Attorney General’s Office, the Ohio Attorney General’s Office and the Virginia Attorney General’s Office; the National Association of Medicaid Fraud Control Units; and the FBI.

 The cases are captioned United States ex rel. Ribik v. ManorCare, Inc., et al., Case No. 1:09cv13-CMH-HCB (E.D. Va.); United States ex rel. Slough v. HCR ManorCare, et al., Case No. 1:14cv1228  (E.D. Va.); and United States ex rel. Carson v. HCR ManorCare, et al., Case No. 1:11cv1054 (E.D. Va.).

The claims asserted against ManorCare are allegations only, and there has been no determination of liability.

Related Material:

Complaint

Source: justice.gov

Washington, DC--(ENEWSPF)--April 21, 2015. The former operator of a Detroit adult day care center and two former owners of Detroit-area home health care companies were sentenced to prison today for their roles in a $29 million Medicare fraud scheme.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan, Special Agent in Charge Paul M. Abbate of the FBI’s Detroit Field Office, Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Chicago Regional Office and Special Agent in Charge Jarod Koopman of Internal Revenue Service Criminal Investigation (IRS-CI) made the announcement.

Felicar Williams, 51, of Dearborn, Michigan, was sentenced to five years in prison and ordered to pay $2,431,018 in restitution, representing the amount paid by Medicare for Williams’ fraudulent claims.  Abdul Malik Al-Jumail, 54, and Jamella Al-Jumail, 25, both of Brownstown, Michigan, were sentenced to 10 years in prison and four years in prison respectively.  Both were also ordered to pay $8,389,541 and $589,516 in restitution, respectively, the amounts paid by Medicare for their fraudulent claims.  The sentences were imposed by U.S. District Judge Denise Page Hood of the Eastern District of Michigan in Detroit.

All three defendants were convicted on Sept. 30, 2014, after a 12-week jury trial in the Eastern District of Michigan.  Williams was convicted of conspiracy to commit health care fraud and conspiracy to receive health care kickbacks.  Abdul Malik Al-Jumail and Jamella Al-Jumail were each found guilty of conspiracy to commit health care fraud.  Abdul Malik Al-Jumail was also found guilty of conspiracy to pay and receive health care kickbacks.  Jamella Al-Jumail was also found guilty of destroying documents in connection with a federal investigation.

According to the evidence at trial, Williams billed Medicare, through her company, Haven Adult Day Care Center LLC, for psychotherapy services that were not actually provided.  The evidence demonstrated that, in some instances, Williams billed Medicare for services purportedly provided to patients who were already deceased.  Williams also sold the private medical information of her patients to Abdul Malik Al-Jumail so that he could use it to submit fraudulent claims to Medicare.   

The evidence further showed that Abdul Malik Al-Jumail obtained patients by paying unlawful kickbacks to Williams and others, and caused claims to be submitted to Medicare for home health services, including physical therapy, that were never delivered.  Like her father, the evidence demonstrated that Jamella Al-Jumail billed Medicare for home health services and physical therapy that were not actually provided.  The evidence at trial also showed that, the day her father was arrested, Jamella Al-Jumail told an employee to retrieve falsified patient medical records from their company, which she and others later burned.

The case was investigated by the FBI, HHS-OIG and the IRS, and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.  The case was prosecuted by Trial Attorneys Christopher Cestaro, Brooke Harper and William Kanellis of the Criminal Division’s Fraud Section, and Assistant U.S. Attorney Patrick Hurford of the Eastern District of Michigan.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,100 defendants who have collectively billed the Medicare program for more than $6.5 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

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

Source: justice.gov

Washington, DC--(ENEWSPF)--April 21, 2015.  Citizens Medical Center, a county-owned hospital in Victoria, Texas, has agreed to pay the United States $21,750,000 to settle allegations that it violated the False Claims Act by engaging in improper financial relationships with referring physicians, the Justice Department announced today.

“The Department of Justice has longstanding concerns about improper financial relationships between health care providers and their referral sources, because those relationships can alter a physician’s judgment about the patient’s true health care needs and drive up health care costs for everybody,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division.  “In addition to yielding a recovery for taxpayers, this settlement should deter similar conduct in the future and help make health care more affordable.”

“Any type of false claim or improper behavior under our health care fraud laws are serious allegations that will not be taken lightly,” said U.S. Attorney Kenneth Magidson of the Southern District of Texas.  “The settlement announced today represents the effectiveness of our continuing efforts and an example of our priorities in this arena.”

The settlement announced today resolved allegations that the hospital provided compensation to several cardiologists that exceeded the fair market value of their services.  The settlement also resolved allegations that the hospital paid bonuses to emergency room physicians that improperly took into account the value of their cardiology referrals.  The United States contended that these agreements violated the Stark Statute and the False Claims Act.  The Stark Statute restricts the financial relationships that hospitals may have with doctors who refer patients to them.

The allegations settled today arose from a lawsuit filed by three whistleblowers, Dakshesh “Kumar” Parikh, Harish Chandna and Ajay Gaalla, under the qui tam provisions of the False Claims Act.  Under the act, private citizens can bring suit on behalf of the government for false claims and share in any recovery.  The whistleblowers will collectively receive $5,981,250 from the recoveries announced today.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs.

The case, United States ex rel. Parikh, et al. v. Citizens Medical Center, et al., Case No. 6:10-cv-64 (S.D. Tex.), was handled by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Southern District of Texas and the U.S. Department of Health and Human Services’ Office of Inspector General.  The claims settled by this agreement are allegations only, and there has been no determination of liability.

Source: justice.gov

Washington, DC--(ENEWSPF)--April 21, 2015.  Four Portland, Oregon, residents were sentenced today in the U.S. District Court in Portland for a multi-year stolen identity tax refund scheme to defraud the United States of more than $1 million in tax refunds, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and Acting U.S. Attorney Billy J. Williams of the District of Oregon.

Jheraun Dunlap, Ernest Bagsby, Jermaine Moore and Brandi McCall were collectively sentenced to serve more than 14 years in prison by U.S. District Judge Robert E. Jones.  Dunlap, 32, who was previously convicted of bank robbery, was sentenced to serve five years and five months in prison.  Bagsby, 37, who was previously convicted of delivery of heroin in Clackamas County, Oregon, was sentenced to serve four years and three months in prison.  Moore, 34, was sentenced to serve three years and nine months in prison, and McCall, 27, was sentenced to serve 12 months and one day in prison.  All four defendants were ordered to pay restitution to the Internal Revenue Service (IRS) in the amount of $427,896.

According to the plea agreements and court documents, the scheme involved the filing of 208 false federal income tax returns that included fraudulent claims for tax refunds between $3,000 and $9,000 per return.  Dunlap electronically filed the false tax returns using stolen identities or identities obtained by Bagsby and Moore.  McCall opened stored-value debit cards in her own name to receive the refunds.  The defendants directed the IRS to deposit the tax refunds onto stored-value debit cards and then the proceeds were shared among the participants in the scheme.  In total, as part of the scheme, the defendants requested more than $1 million in tax refunds.

All four defendants were captured on ATM footage withdrawing cash from stored-value debit cards that held the tax refund proceeds.  As part of the investigation, a search warrant was executed on the Facebook accounts of multiple co-conspirators, from which federal agents obtained photographs of stacks of cash, among other things.  The United States seized and forfeited assets traced to proceeds of the scheme, including a two-carat diamond engagement ring, a Mercedes Benz 500 and a 1971 Pontiac Firebird, both of which were purchased with $20 bills.

Acting Assistant Attorney General Ciraolo and Acting U.S. Attorney Williams commended the special agents of IRS-Criminal Investigation, who investigated the case as part of the Stolen Identity Refund Fraud Task Force, and Trial Attorneys Leslie A. Goemaat and Lori A. Hendrickson of the Tax Division, who are prosecuting the case.  Ciraolo also thanked the U.S. Attorney’s Office in the District of Oregon for their substantial assistance.

Source: justice.gov

Washington, DC--(ENEWSPF)--April 21, 2015.  Family Dermatology P.C. which owns and operates a dermatopathology laboratory in Georgia and a number of dermatology practices throughout the Eastern United States, has agreed to pay the United States $3,247,835 plus interest to settle allegations that it violated the False Claims Act by engaging in improper financial relationships with a number of its employed physicians, the Justice Department announced today.

“The Department of Justice has had longstanding concerns about improper financial relationships between health care providers and their referral sources, because such relationships can alter a physician's judgment about the patient's true health care needs and drive up health care costs for everybody,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Department’s Civil Division.  “In addition to yielding a recovery for taxpayers, this settlement should deter similar conduct in the future and help make health care more affordable.”

The settlement announced today resolved allegations that financial relationships that Family Dermatology and its affiliates had with a number of their employed physicians violated the Stark Statute and the False Claims Act.  The Stark Statute restricts the financial relationships that health care providers may have with doctors who refer patients to them.  Family Dermatology employs a number of dermatologists as independent contractors and it has routinely required them to use Family Dermatology’s in-house pathology lab, which operated under the name Nelson Dermatopathology, for their pathology services.  The government alleged that Family Dermatology’s financial relationships with a number of these physicians did not comply with the requirements of the Stark Statute, and that Family Dermatology improperly billed Medicare for dermatopathology analyses performed by Nelson Dermatopathology on specimens that were sent to the laboratory by these employed physicians.

“The defendants financed the expansion of their business across the Eastern United States with improper financial arrangements that resulted in illegal referrals and, ultimately, inflated payments from Medicare,” said Acting U.S. Attorney John Horn of the Northern District of Georgia.  “We expect providers to follow the law and will pursue those who do not.”

“Physician self-referrals that violate the Stark Statute undermine medical decision making, jeopardize patient care and cost the taxpayers money,” said U.S. Attorney A. Lee Bentley III of the Middle District of Florida.  “Patients need to have confidence that the advice they receive from their physicians is based on sound medical practice, not illegal financial relationships between providers.  We will continue to investigate and pursue these types of violations in our district.”

“This settlement not only demonstrates the need for oversight involving such matters under the False Claims Act, but also the FBI’s commitment toward enforcing this as well as other health care fraud based violations,” said Special Agent in Charge J. Britt Johnson of the FBI’s Atlanta Field Office.

“Health care companies that make sweetheart deals with physicians to boost profits undercut both the financial integrity of Medicare and the public’s trust in the medical profession,” said Special Agent in Charge Derrick L. Jackson of the Department of Health and Human Services’ Office of Inspector General (HHS-OIG).  “Our agency will continue to hold those who engage in such improper financial schemes accountable.”

The allegations settled today arose from three separate lawsuits filed by three whistleblowers, Scott M. Ross MD, Mark F. Baucom and Harold Milstein MD under the qui tam provisions of the False Claims Act.  Under the act, private citizens can bring suit on behalf of the government for false claims and share in any recovery.  The whistleblowers will collectively receive more than $584,000 from the recovery announced today.

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs.

The cases, United States ex rel. Ross v. Family Dermatology of Pennsylvania, P.C., et al., Case No. 1:11-cv-2413 (N.D. Ga.); United States ex rel. Baucom v. Family Dermatology of Pennsylvania, P.C., et al., Case No. 1:11-cv-4260 (N.D. Ga.); and United States ex rel. Milstein v. Family Dermatology, P.C., et al., Case No. 1:13-cv-1027 (N.D. Ga.), were handled by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Offices of the Northern District of Georgia and the Middle District of Florida, and HHS-OIG.

U.S. ex rel. Milstein was originally filed in the Middle District of Florida and subsequently transferred to the Northern District of Georgia.  The claims settled by this agreement are allegations only, and there has been no determination of liability.

Source: justice.gov

Washington, DC--(ENEWSPF)--April 21, 2015.  A futures trader was arrested in the United Kingdom today on U.S. wire fraud and commodities fraud and manipulation charges in connection with his alleged role in the May 2010 “Flash Crash,” when the Dow Jones Industrial Average plunged 600 points in five minutes, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and Special Agent in Charge Robert J. Holley of the FBI’s Chicago Division.

Navinder Singh Sarao, 36, of Hounslow, United Kingdom, was arrested today in the United Kingdom, and the United States is requesting his extradition.  Sarao was charged in a federal criminal complaint in the Northern District of Illinois on Feb. 11, 2015,  with one count of wire fraud, 10 counts of commodities fraud, 10 counts of commodities manipulation, and one count of “spoofing,” a practice of bidding or offering with the intent to cancel the bid or offer before execution.

According to allegations in the complaint, which was unsealed today, Sarao allegedly used an automated trading program to manipulate the market for E-Mini S&P 500 futures contracts (E-Minis) on the Chicago Mercantile Exchange (CME).  E-Minis are stock market index futures contracts based on the Standard & Poor’s 500 Index.  Sarao’s alleged manipulation earned him significant profits and contributed to a major drop in the U.S. stock market on May 6, 2010, that came to be known as the “Flash Crash.”  On that date, the Dow Jones Industrial Average fell by approximately 600 points in a five-minute span, following a drop in the price of E-Minis.

According to the complaint, Sarao allegedly employed a “dynamic layering” scheme to affect the price of E-Minis.  By allegedly placing multiple, simultaneous, large-volume sell orders at different price points—a technique known as “layering”—Sarao created the appearance of substantial supply in the market.  As part of the scheme, Sarao allegedly modified these orders frequently so that they remained close to the market price, and typically canceled the orders without executing them.  When prices fell as a result of this activity, Sarao allegedly sold futures contracts only to buy them back at a lower price.  Conversely, when the market moved back upward as the market activity ceased, Sarao allegedly bought contracts only to sell them at a higher price.

The charges contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

This case is being investigated by the FBI’s Chicago Division.  The case is being prosecuted by Assistant Chief Brent S. Wible and Trial Attorney Michael T. O’Neill of the Criminal Division’s Fraud Section, with assistance provided by the U.S. Attorney’s Office for the Northern District of Illinois, the Criminal Division’s Office of International Affairs and the International Assistance Unit of the Metropolitan Police Service of London, United Kingdom.  The Department of Justice appreciates the substantial assistance of the Commodity Futures Trading Commission’s Division of Enforcement, which referred this matter to the department.  

Related Material:

Sarao Criminal Complaint

Source: justice.gov

Washington, DC--(ENEWSPF)--April 24, 2015.  A Guatemalan national appeared in federal court in the Southern District of Texas, after being extradited to the United States from Guatemala to face criminal charges for her role in smuggling undocumented migrants to the United States for profit, announced Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Kenneth Magidson of the Southern District of Texas and Director Sarah R. Saldaña of U.S. Immigration and Customs Enforcement (ICE).

Rosa Umanzor-Lopez, 35, of Guatemala, was arrested in Guatemala on Feb. 5, 2014, on a provisional arrest warrant based on a superseding indictment filed in the Southern District of Texas in December 2012.  The indictment charges her with one count of conspiracy to smuggle undocumented immigrants into the United States, three counts of bringing aliens to the United States for financial gain and three corresponding counts of encouraging and inducing an alien to come to the United States.  Three individuals also charged in the indictment have previously been convicted and sentenced.

The indictment alleges that Umanzor-Lopez and her co-defendants established a network to recruit individuals from India and elsewhere who wished to be smuggled into the United States.  The defendants then allegedly arranged for aliens to be transported to the United States through South America and Central America by various means including by air travel, automobiles, water craft and foot.

The charges contained in an indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.

The investigation was conducted by ICE’s Homeland Security Investigations (HSI) in McAllen and Houston, with the assistance of U.S. Customs and Border Protection’s Alien Smuggling Interdiction Unit.  This case is being prosecuted by Trial Attorney Christina Giffin of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorneys Leo J. Leo III and Casey MacDonald of the Southern District of Texas.  The Criminal Division’s Office of International Affairs assisted with the extradition.

The investigation was conducted under the Extraterritorial Criminal Travel Strike Force (ECT) program, a joint partnership between the Justice Department’s Criminal Division and HSI.  The ECT program focuses on human smuggling networks that may present particular national security or public safety risks, or present grave humanitarian concerns.  ECT has dedicated investigative, intelligence and prosecutorial resources.  ECT coordinates and receives assistance from other U.S. government agencies and foreign law enforcement authorities. 

Source: whitehouse.gov

Washington, DC--(ENEWSPF)--April 27, 2015.  The Medical Center of Central Georgia (MCCG) has agreed to pay $20 million to settle allegations that the hospital violated the False Claims Act by billing Medicare for more expensive inpatient services that should have been billed as less costly outpatient or observation services, the Justice Department announced today.  MCCG is located in Macon, Georgia, and is the second largest hospital in the state.

“Charging the government for higher cost inpatient services when the patient care received was outpatient or observation services causes Medicare to pay more than it should,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division.  “This department will continue its work to stop abuses of the nation’s health care resources and to ensure patients receive the most appropriate care.”

This settlement resolves the United States’ investigation into MCCG’s inpatient admission practices.  The government contends that from 2004 through 2008, MCCG violated the False Claims Act by knowingly charging Medicare for medically unnecessary inpatient admissions when the care provided should have been billed as less costly outpatient or observation services.  Because hospitals generally receive significantly higher payments from Medicare for inpatient admissions as opposed to outpatient or observation services, the admission of numerous patients whose care should have been billed as outpatient or observation services, as alleged here, can result in substantial financial harm to Medicare.

“Overcharging the government for medical services wastes our country’s limited health care resources,” said Acting U.S. Attorney John Horn of the Northern District of Georgia.  “When a provider inflates its billings, we will aggressively seek to recover the overcharges under the False Claims Act.”  

As part of this agreement, MCCG entered into a corporate integrity agreement with the U.S. Department of Health and Human Services – Office of Inspector General (HHS-OIG) that requires the company to engage in significant compliance efforts over the next five years.  Under the agreement, MCCG is required to retain an independent review organization to review the accuracy of the company’s claims for services furnished to federal health care program beneficiaries.

“Unnecessarily admitting patients who could have been treated in an outpatient or observation setting is not only a waste of taxpayer dollars, but a fundamental breach of trust,” said Special Agent in Charge Derrick L. Jackson of HHS-OIG in Atlanta.  “Medicare beneficiaries must feel secure and know that the care selected for them is in their best interest, and not merely what will generate the most revenue for the facility.”

This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $24 billion through False Claims Act cases, with more than $15.3 billion of that amount recovered in cases involving fraud against federal health care programs.

This matter was investigated by HHS-OIG and the U.S. Attorney’s Office of the Northern District of Georgia.  The claims resolved by this settlement are allegations only and there has been no determination of liability.

Source: justice.gov