FOR IMMEDIATE RELEASE
Thursday, June 1, 2023
Motel Manager Pleads Guilty to Coercing Labor and Sex Acts by Female Victim

A hotel manager in Georgia pleaded guilty today to trafficking with respect to peonage, slavery, involuntary servitude or forced labor.

According to court documents, Shreesh Tiwari, 70, an Indian national and legal U.S. permanent resident, began managing the Budgetel Motel in Cartersville, Georgia, in 2020. Tiwari hired the victim to work as a house cleaner at the motel. Tiwari knew that, prior to arriving at the Budgetel, the victim had experienced homelessness, struggled with a heroin addiction and lost custody of her young child. Tiwari promised the victim that he would help her regain custody of her child by providing her with pay, an apartment, and an attorney.

Instead of following through with his promises, Tiwari monitored the victim’s interactions with motel guests and employees and forbade her from speaking to them. Tiwari also made numerous sexual overtures to the victim. When Tiwari became angry at the victim, he threatened to evict her from the room he offered her at the Budgetel, knowing that she would become homeless as a result. Tiwari also threatened to report the victim’s drug use to law enforcement or child welfare agencies whenever he was angry at her. Eventually, Tiwari began to regularly “evict” the victim from her motel room, and even locked her out of her room at night without warning. Tiwari later required the victim to perform oral sex on him to stay at the motel. If she did not, Tiwari removed her from the property, causing her to be homeless.

“Human trafficking is an abhorrent crime in which traffickers specifically identify and target the most vulnerable members of our society, often using fraudulent promises to offer hope to someone in need,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “This conviction demonstrates that the Justice Department is committed to prosecuting motel operators and other landlords who misuse and abuse their position of power over tenants to compel them to engage in commercial sex acts.”

“Victims of sex trafficking crimes are some of the most vulnerable individuals in our communities and they are targeted by traffickers as a result,” said U.S. Attorney Ryan K. Buchanan for the Northern District of Georgia. “We refuse to tolerate human trafficking of any kind and this conviction reinforces our commitment to protecting all victims of crime in our community – regardless of their status.”

“Prosecuting human traffickers and rescuing human trafficking victims is a top priority of this office and the Department of Homeland Security,” said Acting Special Agent in Charge Travis Pickard of the Homeland Security Investigations (HSI) Atlanta Field Office. “This guilty plea highlights that commitment and serves as a warning to other predators that law enforcement is determined to find, arrest and punish those involved in this heinous crime.”

Sentencing is set for Sept. 6. Tiwari faces a maximum penalty of up to 20 years in prison, as well as a $250,000 fine. As part of his plea agreement, Tiwari agreed to pay slightly over $40,000 in mandatory restitution to the victims of offense. A federal judge will determine any sentence based on the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Clarke, U.S. Attorney Buchanan and Acting Special Agent in Charge Pickard made the announcement.

The Department of Homeland Security, Homeland Security Investigations Dalton Office investigated the case, with assistance from the Georgia Bureau of Investigation and the Bartow-Cartersville Drug Task Force.

Assistant U.S. Attorneys Leanne Marek and Annalise Peters for the Northern District of Georgia and Trial Attorney Kate Hill of the Justice Department’s Human Trafficking Prosecution Unit are prosecuting the case.

Anyone who has information about human trafficking should report that information to the National Human Trafficking Hotline toll-free at 1-888-373-7888, which is available 24 hours a day, seven days a week. For more information about human trafficking, please visit www.humantraffickinghotline.org. Information on the Department of Justice’s efforts to combat human trafficking can be found at www.justice.gov/humantrafficking.

Topic(s): Civil RightsHuman TraffickingComponent(s): Civil Rights DivisionCivil Rights – Criminal SectionPress Release Number: 23-623

Updated June 1, 2023Original Article

FOR IMMEDIATE RELEASE
Thursday, June 1, 2023
Foreign National Charged for $1.8M Wire Fraud and Money Laundering Scheme

An indictment was unsealed today in the Central District of California charging a California businessman for allegedly soliciting investments under false pretenses and using investors’ funds to support his own lavish lifestyle.

According to court documents, Amadou Kane Diallo, 44, a Senegalese national and resident of Laguna Niguel, was the CEO of two California-based companies: Virtual Advisors LLC and Liquide Inc. Diallo allegedly solicited investments in his companies from at least 11 individuals for purported business opportunities in technology, health care, real estate, home ownership, and service to the African diaspora. Diallo allegedly made various false representations, including that investor funds would be spent to further investors’ interests, or not be spent at all, and instead used as “skin in the game” to attract institutional investors. Diallo is also alleged to have lied to potential investors, claiming that he had raised hundreds of millions of dollars for another investment firm and its real estate investment fund when, in fact, he had never raised any such funds.

Diallo allegedly caused at least 11 victim-investors to pay him, Virtual Advisors, and Liquide, more than $1.8 million. Contrary to his representations to investors, Diallo allegedly used their money to fund his own extravagant lifestyle, including making rent payments on his home; paying for luxury vehicles; buying clothes and fancy dinners; joining fitness clubs and spas; and hosting lavish events for foreign government officials.

Diallo is charged with 19 counts of wire fraud and two counts of money laundering. If convicted, he faces a maximum penalty of 20 years in prison on each of the wire fraud counts and a maximum penalty of 10 years in prison on each of the money laundering counts.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Martin Estrada for the Central District of California, Assistant Director Luis M. Quesada of the FBI’s Criminal Investigative Division, and Assistant Director in Charge Donald Alway of the FBI Los Angeles Field Office made the announcement.

The FBI is investigating the case.

Trial Attorney William E. Schurmann of the Criminal Division’s Fraud Section and Special Assistant U.S. Attorney Ryan G. Adams for the Central District of California are prosecuting the case.

If you believe you are a victim of Mr. Diallo’s conduct, please contact the Fraud Section’s Victim Witness Unit toll-free at (888) 549-3945 or by email at victimassistance.fraud@usdoj.gov.

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

Topic(s): Financial FraudSecurities, Commodities, & Investment FraudComponent(s): Criminal DivisionCriminal – Criminal Fraud SectionFederal Bureau of Investigation (FBI)USAO – California, CentralPress Release Number: 23-621

Updated June 1, 2023Original Article

Remarks as Delivered

Good morning. I appreciate the opportunity to speak with you today. Many thanks to the International Bar Association for the invitation, and to Anne Walsh for the kind introduction. I look forward hearing from conference participants about some of the challenges and opportunities that cross international boundaries.

Across the globe, the COVID-19 pandemic made clear what those attending this conference know well – that, when it comes to the health and safety of its citizens, no nation is isolated from its neighbors. Pharmaceutical companies and researchers in all corners of the globe fight the same diseases and wrestle with how to best utilize rapidly evolving technologies to improve lives. And the global nature of commerce means that products developed in one part of the world may be manufactured in another part of the world, using materials from yet another part of the world, and then are shipped to and used in, still, other parts of the world.

Today, I would like to share with you how the Consumer Protection Branch of the United States Department of Justice approaches its cases and initiatives — including matters that involve conduct occurring outside the United States — and also highlight a few important new policies that we expect will strengthen the department’s ability to investigate misconduct occurring outside the United States and help to protect consumers around the world.

Some of you might not be familiar with the branch or might not have encountered the Branch in some time – and so I’d like to begin by providing an overview of the Branch, including how the branch approaches its important work of protecting the health and safety of the public.

The Consumer Protection Branch was created over 50 years ago and began, like many consumer protection initiatives across the United States, as an offshoot of antitrust efforts. Over the past half-century, the size and portfolio of the Branch have grown. Today, the branch has over 100 attorneys — supported by paralegals, investigators, document analysts, and data scientists — who collectively tackle a range of misconduct impacting the health, safety, economic security, and identity integrity of members of the public. In furthering this mission, the branch relies on both civil actions — including those that enjoin wrongful behavior and seek monetary penalties — as well as criminal prosecutions.

The branch regularly conducts affirmative enforcement activity related to prescription drugs, medical devices, food safety, dietary supplements, tobacco and nicotine products, and opioids. In all these areas, we employ both civil and criminal tools.

In our work, we closely coordinate with U.S. Attorneys’ Offices across the country, law enforcement agencies like the Federal Bureau of Investigation, the Drug Enforcement Administration (DEA) and the U.S. Postal Inspection Service and our valued agency partners, including the U.S. Food and Drug Administration (FDA). All these agencies help provide the branch with international support and assistance – in recognition of the fact that effective prevention and enforcement requires building and maintaining strong relationships around the world.

With respect to the branch’s work in the life sciences space, our investigations generally fall into two categories. Where the branch and its partners identify a pervasive problem or widespread misconduct related to certain categories of products or industries, we seek to attack that misconduct holistically, targeting a wide range of actors that potentially may be responsible for contributing to a particular problem. Other times, however, we focus on individual bad actors whose conduct may be harming consumers.

The branch’s past and current efforts related to opioids are illustrative. According to the World Health Organization, approximately one-half-million deaths worldwide are attributable to drug use, with more than 70% of those deaths related to opioids. In the United States, overdose deaths have risen sharply over the last decade, and a current estimate places the number of annual overdose deaths at approximately 100,000.

Seeking to combat this global crisis, the branch has endeavored to identify and hold accountable individual and corporate actors at every point in the supply chain, including manufacturers, distributors, and dispensers of opioids. These efforts have included complex civil lawsuits against multinational companies based in the United States — including a landmark ongoing lawsuit brought by the branch against Walmart in connection with dispensing and distribution practices at the company’s pharmacies. And in December 2022, the branch also sued one of the largest drug distributors in the United States, AmerisourceBergen, alleging that the company committed hundreds of thousands of violations of the Controlled Substances Act.

In addition to these civil lawsuits, the branch also has pursued criminal prosecutions, where appropriate. In October 2020, opioid manufacturer Purdue Pharma LP pleaded guilty to conspiracy to defraud the United States and to violate the anti-kickback statute. Specifically, Purdue admitted to impeding the Drug Enforcement Administration by representing that it maintained an effective anti-diversion program when, in fact, Purdue continued to market its opioid products to more than 100 health care providers whom the company had reason to believe were diverting opioids. Purdue also admitted that it reported misleading information to the DEA to boost Purdue’s manufacturing quotas. And Purdue acknowledged making payments to doctors through the company’s doctor speaker program to induce those doctors to write more prescriptions of Purdue’s opioid products.

The branch also has sought to hold accountable companies that attempt to profit from abuse treatments through deception. For example, in July 2019, global consumer goods conglomerate Reckitt Benckiser Group agreed to pay $1.4 billion to resolve its potential criminal and civil liability related to a federal investigation of the marketing of the opioid addiction treatment drug Suboxone. And a subsidiary of the company, Indivior Solutions, also pleaded guilty – admitting that it falsely promoted the film version of Suboxone to physicians, pharmacists, Medicaid administrators, and others across the country as less-divertible and less-abusable and safer around children, families and communities than other buprenorphine drugs, even though such claims had never been established.

More recently, as the nature of the opioid crisis has evolved, the branch and its law enforcement partners also have adapted and are now working to stem the flow of illicit fentanyl. The urgency of disrupting this activity is clear. Last year, the DEA and its partners seized over 50 million fake prescription pills — more than double the amount seized in 2021. This presents a global challenge: essential ingredients for illicit pills often come from different parts of the world, the illicit pills are sometimes manufactured in other parts of the world, and the illicit pills are then trafficked across international borders.

At the branch, we are once again taking a holistic view of this problem – seeking to identify corporate bad actors responsible for aiding the manufacture, distribution, and sale of illicit pills, including global e-commerce sites, social media platforms, and multinational chemical companies. And we are also examining the conduct of companies responsible for supplying narcotics traffickers with the equipment needed to make illicit pills, such as industrial pill presses and counterfeit dyes.

In recognition of the complexity of these matters, in March 2023, Associate Attorney General Vanita Gupta announced the creation of the Opioid Epidemic Civil Litigation Task Force, which formalizes and enhances coordination of the Department’s existing work and will also consider new initiatives. Because of the scope and duration of the crisis, the task force includes U.S. Attorneys’ Offices, the Consumer Protection Branch and the Civil Division’s Commercial Litigation Branch, the Drug Enforcement Administration, and other department components. The task force will steer the department’s civil litigation efforts involving actors alleged to have contributed to the opioid epidemic.

The branch also has remained focused on global enforcement efforts related to dietary supplements, including those marketed to the public as purportedly safe workout or weight loss supplements, but that frequently include ingredients capable of causing serious harm (including liver damage). Our investigations have revealed that ingredients for these products often have been imported into the United States from abroad using deception.

For example, last year the founder and operator of a Florida-based supplement retailer was sentenced to 54 months in prison, following his conviction for lying to consumers by falsely characterizing certain products as safe and legal dietary supplements. In addition, the defendant falsely represented that the unsafe products were made in “FDA approved” registered facilities and in compliance with required regulations, when in fact they were not. He also admitted to directing the fraudulent importation of raw ingredients for products from China, to ignoring injury reports made by consumers, and to failing to notify the FDA of such complaints, even when required by law.

In another matter brought by the branch in Texas, two Chinese nationals involved in importing raw ingredients for dietary supplements were convicted in connection with their participation in a scheme to sell mislabeled dietary supplements. The branch was able to prosecute this matter partially due to information provided by a confidential government informant. The defendants were arrested while attending a dietary supplement trade show in Las Vegas, and one defendant ultimately admitted to making false statements to FDA’s import division regarding a shipment of synthetic stimulants entering the United States.

And in a matter brought by the branch in California, the branch secured criminal charges against an import company and four individuals allegedly responsible for smuggling dietary supplement ingredients into the United States from China for use in consumer products. According to the indictment, the defendants assembled a false shipment designed to fool the FDA into believing that the company had destroyed substances that the FDA had blocked from distribution. But in reality, the company had already shipped the forbidden products, and instead, presented mislabeled substitutes to the FDA for destruction. The indictment further alleges that, in connection with this scheme, the defendants prepared fraudulent documents, including false certificates of analysis and false labels and submitted those fraudulent documents to the FDA when they suspected that an ingredient would be denied entry or would trigger inquiries from the FDA and Customs and Border Protection inspectors. These documents falsely declared the substances to be sucralose, melatonin, or other legal ingredients – and thereby served to conceal the actual contents, which included dangerous designer steroids and stimulants.

As with the branch’s efforts to combat fraud in the dietary supplements space, investigations involving the manufacturing of lifesaving drugs increasingly cross international boundaries. In conducting these investigations, the branch benefits greatly from our strong relationship with FDA, whose dedicated employees strive to protect public health around the world.

One noteworthy recent matter involved an FDA inspection of a manufacturing facility in India that led to the discovery of concerning issues associated with a cancer drug. In March 2021, Indian drug manufacturer Fresenius Kabi Oncology Limited, or FKOL, pleaded guilty to concealing and destroying records prior to an FDA plant inspection and ultimately paid $50 million in fines. FKOL owned and operated a manufacturing plant in Kalyani, West Bengal, India, that manufactured active pharmaceutical ingredients used in various cancer drug products. Prior to an inspection of the Kalyani facility, FKOL plant management directed employees to remove certain records from the premises and delete other records from computers – records that would have revealed that FKOL was manufacturing drug ingredients in contravention of FDA requirements. Kalyani plant employees removed computers, hardcopy documents, and other materials from the premises and deleted spreadsheets that contained evidence of the plant’s violative practices.

Using the Mutual Legal Assistance Treaty process, investigators traveled to India and heard directly from witnesses with firsthand knowledge of the misconduct. The Central Bureau of Investigation in India also provided invaluable assistance to U.S. authorities during the investigation.

As a result of these efforts, FKOL has been ordered to develop and implement a compliance and ethics program designed to prevent, detect, and correct violations of United States law relating to FKOL’s manufacture of cancer drugs intended for terminally-ill patients.

Another recent case involving the branch demonstrates the globally interconnected nature of the medical products industry. In 2021, Avanos, a U.S.-based multinational medical device corporation, entered into a deferred prosecution agreement with the Department of Justice, in which the company agreed to pay $22 million to resolve a criminal charge related to fraudulent misbranding of its MicroCool surgical gowns.

Surgical gowns are evaluated based upon how well they provide a barrier between the health care provider and potential contaminants. Specifically, gowns are rated from one to four, with four being reserved for gowns intended for surgeries and other high-risk medical procedures on patients suspected of having infectious diseases. Level four gowns protect both patients and health care workers from potential blood-borne pathogens. These products must pass certain tests on all critical areas of the gown where direct contact with blood and other fluids are most likely to occur.

The specific products involved in this case were manufactured into finished gowns at a plant in Honduras. As part of that process, the gown sleeves were sealed using machines that were highly variable and unstable – and, as a result, the operators of the machines were unable to consistently ensure that sleeves were properly sealed. And if they were not properly sealed, the sleeves could develop cracks or holes, or even come apart entirely. Unsurprisingly, the gowns repeatedly failed liquid-penetration monitoring testing.

Nevertheless, Avanos employees misrepresented MicroCool surgical gowns as meeting Level four standards, in multiple direct communications with hospital customers. Concerningly, certain customers had sought assurances because they needed to obtain gowns for use in responding to an Ebola virus outbreak — a disease that is carried via bodily fluids and which carries an average fatality rate of 50%. Avanos ultimately sold approximately $9 million worth of misbranded MicroCool surgical gowns to customers located both in the United States and abroad.

Under the terms of the deferred prosecution agreement, Avanos was ordered to pay $22 million, including a victim compensation payment of almost $9 million, a criminal monetary penalty of more than $12.5 million dollars, and a disgorgement payment of almost $700,000. Avanos also agreed to strengthen its compliance program and to abide by specific reporting requirements, which require the company to submit yearly reports to the government regarding the status of Avanos’s enhancements to its compliance program and internal controls, its policies and procedures aimed at deterring and detecting violations of the Food, Drug and Cosmetic Act and U.S. fraud laws, and the status of its remediation efforts.

The Avanos resolution, which was a joint effort between the branch, the Criminal Division’s Fraud Section, the U.S. Attorney’s Office for the Northern District of Texas, and FDA’s Office of Criminal Investigations, specifically noted the factors considered by the government in reaching the resolution. These included the nature and seriousness of the offense conduct and Avanos’s failure to timely and voluntarily self-disclose the misconduct. The government credited the fact that Avanos fully cooperated, conducted an internal investigation, promptly responded to requests from the department, assisted in making foreign-based employees available for interviews, and provided documents located in a foreign jurisdiction.

The failure to timely and voluntarily self-disclose misconduct was an important factor in the Avanos resolution. Since that matter was resolved, the department has made important revisions to the department’s corporate criminal enforcement policies and practices, including to the parameters for the voluntary self-disclosure of misconduct and cooperation credit. In September 2022, Deputy Attorney General Lisa Monaco announced that every department component responsible for prosecuting corporate crime would be required “to review its policies on corporate voluntary self-disclosure, and if the component lacks a formal, written policy to incentivize such self-disclosure, it must draft and publicly share such a policy.”

With the goal of making the benefits of voluntary self-disclosure “clear and predictable,” the Deputy Attorney General directed that all department components implement formalized policies setting forth expectations regarding:

• The timeliness of a voluntary self-disclosure;
• The requirement that the disclosure be accompanied by timely preservation, collection, and production of relevant documents and/or information;
• The types of information and facts that must be provided as part of the disclosure process;
• The benefits a corporation can expect to receive if it meets the standards for voluntary self-disclosure; and
• Aggravating factors that would require a guilty plea even if the corporation voluntarily and timely self-disclosed, such as where the misconduct was deeply pervasive throughout the company.

Consistent with the Deputy Attorney General’s directive, earlier this year the Consumer Protection Branch released its voluntary disclosure policy. Absent aggravating factors, the Branch will not seek a guilty plea if a company has voluntarily self-disclosed to the Branch, fully cooperated, and timely and appropriately remediated the criminal conduct. But disclosure must be accompanied by timely preservation, collection, and production of relevant documents. And a company must disclose all relevant facts known at the time of the disclosure, including facts relating to individuals involved in the misconduct.

As the Deputy Attorney General has noted, department components have not issued “cookie-cutter” policies. Rather, the Consumer Protection Branch carefully considered its unique mission when developing its policy, which encourages voluntary self-disclosure regarding potential violations involving the manufacture, distribution, sale, or marketing of products regulated by, or conduct under the jurisdiction of the FDA, the Consumer Products Safety Commission, the Federal Trade Commission, or the National Highway Transportation Safety Administration, as well as potential misconduct involving failures to report to, or misrepresentations to, those agencies.

The potential aggravating factors also have been carefully calibrated to address the Branch’s focus on health and safety and consumer fraud. Examples of such aggravating factors include:

• Conduct that places consumers at significant risk of death or serious bodily injury; and
• Conduct that intentionally or willfully targets older adults, immigrants, veterans and servicemembers, or other vulnerable victims.

Our policy is available on the Consumer Protection Branch’s webpage and contains an email address to which disclosures can be submitted.

All of these voluntary self-disclosure policies are part of a broader effort to ensure that companies and individuals engaged in misconduct are held accountable as expeditiously as possible.

The branch also is increasing its scrutiny of repeat offenders – in particular, wrongdoing involving the same personnel or management as the current misconduct.

Similarly, facts that indicate broader weakness in a company’s compliance culture or practices are likely to result in a more severe resolution than situations where a company has a track record of compliance and problems are promptly and appropriately addressed. Having a corporate culture that promotes ethical behavior matters, and the Department encourages companies to consider implementing compensation policies, including as to clawbacks, that are structured to incentivize compliant behavior and deter misconduct.

In conclusion, we are hopeful that these new policies will help to advance important investigations involving documents and witnesses located outside the United States and will encourage corporate leaders to invest in effective compliance programs.

And speaking of investments, thank you for investing your time and energy to travel to Washington and engage with your colleagues at this conference. I am grateful to the International Bar Association for providing me with the opportunity to speak with you this morning. Thank you.

Speaker: Deputy Assistant Attorney General Arun G. Rao (Consumer Protection Branch)Component(s): Civil Division

Updated June 1, 2023Original Article

FOR IMMEDIATE RELEASE
Wednesday, May 31, 2023
Former Texas Sheriff’s Office Chief Deputy Sentenced for Using Excessive Force

A former Van Zandt County, Texas, Sheriff’s Office Chief Deputy was sentenced today to 44 months in prison for violating an arrestee’s civil rights by using excessive force against him.

According to court documents, Steven “Craig” Shelton, 62, previously pleaded guilty and admitted that on or about Sept. 21, 2021, while acting as the Chief Deputy and second-in-command of the Van Zandt County Sheriff’s Office, he repeatedly struck a handcuffed and compliant arrestee in the face. Shelton admitted that his acts, which occurred in front of several other officers in the Rolling Oaks area of Wills Point, Texas, caused bodily injury to the arrestee. Shelton admitted that he hit the arrestee because Shelton was frustrated, even though Shelton knew that there was no legitimate, law enforcement need to use force against the arrestee.

“This defendant abused his authority as a law enforcement officer by violently assaulting and injuring a handcuffed arrestee, violating the victim’s civil rights and the public’s trust,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department will continue to hold accountable those officers who abuse their authority, wherever such abuses occur.”

“It is an unacceptable abuse of authority for a police officer to strike a handcuffed arrestee who poses no threat,” said U.S. Attorney Damien M. Diggs for the Eastern District of Texas. “Public trust in law enforcement is eroded when officers do not follow the laws they are sworn to enforce. While recognizing that a vast majority of law enforcement officers protect the constitutional rights of individuals on a daily basis, the U.S. Attorney’s Office remains committed to protecting the public from officers who violate those rights.”

“The FBI regards the protection of civil rights as one of our most solemn responsibilities,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “We will continue to investigate any law enforcement officer who violates these rights, and pursue justice for victims.”

The FBI Dallas Field Office investigated the case.

Assistant U.S. Attorney Tracey Batson for the Eastern District of Texas and Special Litigation Counsel Kathryn E. Gilbert and Trial Attorney Matthew Tannenbaum of the Civil Rights Division’s Criminal Section prosecuted the case.

Topic(s): Civil RightsComponent(s): Civil Rights DivisionCivil Rights – Criminal SectionPress Release Number: 23-617

Updated June 2, 2023Original Article

FOR IMMEDIATE RELEASE
Wednesday, May 31, 2023
Court Permanently Bars Five Defendants From Promoting Charitable Remainder Annuity Trust Tax Scheme

Court Also Orders Multiple Parties to Disgorge $1.5 Million in Alleged Ill-Gotten Gains

On May 23, the U.S. District Court for the Western District of Missouri permanently barred Rhonda Eickhoff from organizing, promoting, selling or marketing a tax scheme involving the use of charitable remainder annuity trusts (CRATs).

On May 17, the court likewise permanently barred John Eickhoff Jr. and Hoffman Associates LLC from organizing, promoting, selling or marketing a tax scheme involving the use of CRATs. In addition, the court ordered Hoffman Associates LLC, the company allegedly used to promote the scheme, to disgorge $1.1 million and John Eickhoff Jr. to disgorge $400,000. The court previously entered injunctions against defendants John William Gray II and Damon Thomas Eisma stemming from their roles in this scheme. Each defendant agreed to the court orders. The case against two additional defendants for their roles in this scheme remains pending.

According to the United States’ amended complaint, defendants falsely claimed that customers following their CRAT scheme could sell property in a way that eliminated the federal income tax on the gain generated from the sale. The government alleged each defendant took part in one or more of the following steps involved in the scheme: (1) recruiting customers to contribute property to a CRAT (usually real property that has gained value over time); (2) unlawfully inflating (stepping-up) the cost basis in the property on tax documents; (3) selling the property and using the proceeds to purchase an annuity; and (4) falsely reporting the annuity payments received by the customers as tax-free distributions from the CRAT. The government alleged that the defendants promoted, sold, or established at least 70 CRATs, resulting in an estimated $40 million of unreported taxable income.

Abusive arrangements using Charitable Remainder Annuity Trusts remain a concern of the IRS, which recently warned taxpayers about the misuse of this trust arrangement as part of the IRS’s Dirty Dozen series.

Deputy Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.

Taxpayers seeking a return preparer should remain vigilant against unscrupulous tax preparers. The IRS offers tips on how to accurately file returns and how to choose a tax return preparer, as well as steps taxpayers can take to get a jumpstart on filing. The IRS also offers 10 tips to avoid tax season fraud and ways to safeguard their personal information. Taxpayers seeking assistance can access the IRS’s free directory of federal tax preparers.

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

Topic(s): TaxComponent(s): Tax DivisionPress Release Number: 23-616

Updated May 31, 2023Original Article

FOR IMMEDIATE RELEASE
Wednesday, May 31, 2023
Justice Department Secures Over $3 Million Redlining Settlement Involving ESSA Bank & Trust in Philadelphia

The Justice Department announced today that ESSA Bank & Trust (ESSA) has agreed to pay over $3 million to resolve allegations that it engaged in a pattern or practice of lending discrimination by redlining majority-Black and Hispanic neighborhoods in and around Philadelphia. Redlining is an illegal practice in which lenders avoid providing credit services to individuals living in communities of color because of the race, color or national origin of the residents in those communities.

The complaint filed in federal court today alleges that from at least 2017 to 2021, ESSA failed to provide mortgage lending services and did not serve the credit needs of majority-Black and Hispanic neighborhoods in the Philadelphia metropolitan area.

“For too long, residents of communities of color have been unlawfully denied equal access to credit and shut out of economic opportunities,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “When banks engage in redlining, they perpetuate existing patterns of segregation and widen the racial wealth gap in our country. This resolution makes clear our commitment to holding banks and financial institutions accountable for modern day redlining while ensuring access to fair lending in communities of color.”

“Accessing the American dream of owning your own home is possible only when there is equality for all in their opportunities to access lending in the residential mortgage markets,” said U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania. “Redlining in Greater Philadelphia has deep roots; it’s led to decades of disinvestment in communities of color. We appreciate ESSA’s prompt cooperation with the department’s investigation and their efforts that will aim to infuse lending resources and help build wealth in neighborhoods of color.”

Under the proposed consent order, which is subject to court approval, ESSA has agreed to invest at least $2.92 million in a loan subsidy fund to increase access to credit for home mortgage, improvement and refinance loans, as well as home equity loans and lines of credit, in majority-Black and Hispanic neighborhoods in the bank’s lending area. ESSA has also agreed to spend an additional $125,000 on community partnerships and $250,000 on advertising, outreach, consumer financial education and credit counseling, in an effort to expand the bank’s services in majority-Black and Hispanic communities. The consent order also requires the bank to hire two new mortgage loan officers to serve its existing branches in West Philadelphia and conduct a research-based market study to help identify the needs for financial services in communities of color.

The department opened its investigation into ESSA’s lending practices after receiving a referral from the Federal Deposit Insurance Corporation. ESSA fully cooperated with the department’s investigation and worked expeditiously to resolve these allegations.

In October 2021, the department launched its Combating Redlining Initiative as a coordinated enforcement effort to address this persistent form of discrimination against communities of color. Since the initiative was launched, the department has announced seven redlining cases and settlements and secured $87 million in relief for communities of color that have been victims of lending discrimination across the country.

More information about the department’s fair lending enforcement can be found at www.justice.gov/fairhousing. Individuals may report lending discrimination by calling the Justice Department’s housing discrimination tip line at 1-833-591-0291 or submitting a report online.

Attachment(s): Download Consent Order.pdf Download Complaint.pdfTopic(s): Civil RightsFair HousingComponent(s): Civil Rights DivisionCivil Rights – Housing and Civil Enforcement SectionPress Release Number: 23-615

Updated May 31, 2023Original Article

FOR IMMEDIATE RELEASE
Wednesday, May 31, 2023
United States Files Civil Action to Collect Unpaid Civil Penalties and Reclamation Fee Debts

Complaint Names 13 Coal Companies Owned or Operated by James Justice III

The Justice Department today announced the filing of a civil action against James C. Justice III and 13 coal companies he owns or operates seeking to collect unpaid civil penalties previously assessed by the Department of the Interior (DOI) Office of Surface Mining Reclamation and Enforcement (OSMRE), as well as Abandoned Mine Land (AML) reclamation fee and audit debts.

“Our environmental laws serve to protect communities against adverse effects of industrial activities including surface coal mining operations,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “Through this suit, the Justice Department seeks to deliver accountability for defendants’ repeated violations of the law and to recover the penalties they owe as a result of those violations.”

“Over a five-year period, defendants engaged in over 130 violations of federal law, thereby posing health and safety risks to the public and the environment,” said U.S. Attorney Christopher R. Kavanaugh for the Western District of Virginia. “After given notice, they then failed to remedy those violations and were ordered over 50 times to cease mining activities until their violations were abated. Today, the filing of this complaint continues the process of holding defendants accountable for jeopardizing the health and safety of the public and our environment.”

Pursuant to the Surface Mining Control and Reclamation Act (SMCRA), when a permittee violates SMCRA or their applicable permit, OSMRE issues a notice of violation (NOV) for non-imminently dangerous violations. The NOV sets a deadline for abating the violation. If the permittee fails to abate the violation by the NOV’s deadline, OSMRE issues a cessation order to halt mining until the violation is abated. If the permittee still fails to abate the violation within 30 days of the cessation order, OSMRE can take certain actions, including assessing civil penalties. If the violation creates an imminent danger to the health or safety of the public, OSMRE issues a second type of cessation order, called an Imminent Harm Cessation Order (IHCO), in lieu of an NOV, which requires cessation of active mining until the violation is abated. Separately, a director, officer or agent of a corporate permittee can be subject to individual civil penalties for willfully and knowingly authorizing, ordering or carrying out a permit violation or failure to comply with certain OSMRE orders.

From 2018 to 2022, OSMRE cited the defendants for over 130 violations and issued the companies over 50 cessation orders. The underlying violations pose health and safety risks or threaten environmental harm. In addition, defendants failed to pay required AML fees, which fund the reclamation of coal mining sites abandoned or left in an inadequate reclamation status. According to today’s filing, the total amount of the penalties and AML fees, plus interest, penalties and administrative expenses, owed by the defendants is approximately $7.6 million.

Assistant U.S. Attorney Krista Consiglio Frith for the Western District of Virginia and Trial Attorneys Sally J. Sullivan and Clare Boronow of the Environment and Natural Resources Division are handling this matter.

Attachment(s): Download 7:23-cv-00318-RSB complaintTopic(s): Environmental JusticeComponent(s): Environment and Natural Resources DivisionUSAO – Virginia, WesternPress Release Number: 23-614

Updated May 31, 2023Original Article

FOR IMMEDIATE RELEASE
Wednesday, May 31, 2023
Former New Mexico House of Representatives Candidate Charged for Shooting Spree

An indictment was unsealed today in the District of New Mexico charging a former candidate for the New Mexico House of Representatives for a shooting spree targeting the homes of four elected officials.

According to court documents, Solomon Peña, 40, ran for District 14 of the New Mexico House of Representatives during the November 2022 mid-term elections. After his November 2022 electoral defeat, Peña allegedly organized the shootings on the homes of two Bernalillo County commissioners and two New Mexico state legislators. The shootings, one of which involved a machine gun, were carried out between Dec. 4, 2022, and Jan. 3, with assistance from co-conspirators Demetrio Trujillo, 41; Jose Trujillo, 22; and others.

Before the shootings, Peña visited the homes of at least three Bernalillo County commissioners and allegedly urged them not to certify the election results, claiming that the election had been “rigged” against him. Following the Bernalillo County board of commissioners’ certification of the vote, Peña allegedly hired others to conduct the shootings and carried out at least one of the shootings himself. At least three of the shootings occurred while children and other relatives of the victims were at home.

“There is no room in our democracy for politically motivated violence, especially when it is used to undermine election results,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “As alleged, Solomon Peña orchestrated four shootings at the homes of elected officials, in part because of their refusal to overturn his election defeat. Such violent actions target not only the homes and families of elected officials, but also our election system as a whole. The department will not hesitate to hold individuals accountable for acts of politically motivated violence.”

“In America, the integrity of our voting system is sacrosanct,” said U.S. Attorney Alexander M.M. Uballez for the District of New Mexico. “These charges strike at the heart of our democracy. Voters, candidates, and election officials must be free to exercise their rights and do their jobs safely and free from fear, intimidation, or influence, and with confidence that law enforcement and prosecuting offices will lead the charge when someone tries to silence the will of the people. To those who try to sow division, chaos, and fear into our democratic process, these charges should send a message that we are unified, organized, and undaunted.”

“The FBI and our partners are committed to ensuring violent crime investigations remain a priority,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “We will continue to pursue justice in cases like these in the name of safety for the American people.”

Peña, Demetrio Trujillo, and Jose Trujillo are charged with conspiracy, interference with federally protected activities, and several firearms offenses, including the use of a machine gun. If convicted, Peña faces a mandatory minimum of 60 years in prison. Jose Trujillo was also charged with possession with intent to distribute fentanyl and firearms offenses, including possession of a machine gun.

The FBI and the Albuquerque Police Department investigated the case.

Senior Litigation Counsel Victor R. Salgado of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorneys Jeremy Peña and Patrick E. Cordova for the District of New Mexico are prosecuting the case.

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

Topic(s): Violent CrimeVoting and ElectionsFirearms OffensesComponent(s): Criminal DivisionCriminal – Public Integrity SectionFederal Bureau of Investigation (FBI)USAO – New MexicoPress Release Number: 23-619

Updated June 1, 2023Original Article

FOR IMMEDIATE RELEASE
Wednesday, May 31, 2023
Detroit Medical Center, Vanguard Health Systems, and Tenet Healthcare Corporation Agree to Pay Over $29 Million to Settle False Claims Act Allegations

VHS of Michigan Inc., doing business as, The Detroit Medical Center Inc. (DMC), Vanguard Health Systems Inc. (Vanguard), and Tenet Healthcare Corporation (Tenet), has agreed to pay $29,744,065 to the government to resolve allegations that they violated the False Claims Act by providing kickbacks to certain referring physicians.

DMC operates hospitals in and around Detroit, including Sinai Grace Hospital and Harper University Hospital. In October 2013, Tenet acquired Vanguard owned-and-operated hospitals and outpatient facilities, including DMC.

The settlement announced today resolves the government’s allegations that DMC, Vanguard, and Tenet caused the submission of false or fraudulent claims to Medicare. Specifically, the government alleged that from Jan. 1, 2014, through Dec. 31, 2017, Sinai Grace Hospital and Harper University Hospital provided the services of DMC-employed mid-level practitioners to 13 physicians at no cost or below fair market value in violation of the Anti-Kickback Statute (AKS). The government further alleged that the physicians were selected because of their large number of patient referrals to Sinai Grace Hospital and Harper University Hospital and that the purpose of these arrangements was to induce the physicians to refer additional Medicare patients to DMC facilities.

The AKS prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare and other federally funded programs. The statute is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives and are instead based on the best interests of their patients.

“The Justice Department will pursue improper arrangements that have the potential to compromise physicians’ medical judgment,” said Deputy Assistant Attorney General Michael D. Granston of the Justice Department’s Civil Division. “Physicians should evaluate where to send patients for medical services based on the quality of care the patients will receive, not the financial benefits that the physicians will reap.”

“This outcome makes clear that when doctors refer patients for care at hospitals, they must do so based on their own professional judgment and the medical needs of their patients, not personal financial benefit,” said U.S. Attorney Dawn N. Ison for the Eastern District of Michigan. “Our office stands ready to scrutinize even the most complicated financial arrangements and to pursue justice wherever appropriate.”

“Paying and accepting kickbacks encourages providers to put personal financial gain before the needs of their patients,” said Special Agent in Charge Mario Pinto of the Department of Health and Human Services Office of Inspector General (HHS-OIG). “As this case demonstrates, those who enter into such improper arrangements and put the safety of their patients at risk will be held accountable.”

The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Dr. Jay Meythaler, a former employee of Wayne State University Medical School, which is affiliated with DMC. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. In this case, Dr. Meythaler will receive $5,205,211.37 as part of the settlement. The qui tam case is captioned U.S. ex rel. Meythaler v. Detroit Medical Center, Inc., et al., No. 5:15-cv-12333 (E.D. Mich.).

The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s, Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Eastern District of Michigan, with assistance from the HHS-OIG and the FBI.

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

Trial Attorney Kristen Murphy of the Civil Division and Assistant U.S. Attorney Anthony Gentner for the Eastern District of Michigan handled the case.

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

Topic(s): False Claims ActComponent(s): Civil DivisionPress Release Number: 23-620

Updated May 31, 2023Original Article

FOR IMMEDIATE RELEASE
Wednesday, May 31, 2023
Two Nigerian Nationals Previously Extradited from the United Kingdom Plead Guilty to International Fraud Scheme that Defrauded Elderly U.S. Victims

Two Nigerian nationals who were extradited to the United States from the United Kingdom pleaded guilty to operating a transnational inheritance fraud scheme.

According to court documents, Jerry Chucks Ozor, 43, and Iheanyichukwu Jonathan Abraham, 44, were part of a group of fraudsters that sent personalized letters to elderly victims in the United States, falsely claiming that the sender was a representative of a bank in Spain and that the recipient was entitled to receive a multimillion-dollar inheritance left for the recipient by a family member who had died years before in Spain. Victims were told that before they could receive their purported inheritance, they were required to send money for delivery fees, taxes, and payments to avoid questioning from government authorities. Victims sent money to the defendants through a complex web of U.S.-based former victims. The defendants convinced these former victims to receive money from new victims and then forward the fraud proceeds to others (thereby serving as so-called “money mules”). In pleading guilty, the defendants admitted to defrauding over $6 million from more than 400 victims, many of whom were elderly or otherwise vulnerable.

“The Justice Department’s Consumer Protection Branch will pursue, prosecute, and secure the convictions of transnational criminals responsible for defrauding U.S. consumers, wherever they are located. I thank the United Kingdom’s National Crime Agency for its extensive efforts in helping to ensure that these defendants are held accountable here in the United States,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The Justice Department and U.S. law enforcement will continue to work closely with law enforcement partners across the globe to bring to justice criminals who attempt to defraud U.S. victims from outside the United States.”

“The U.S. Postal Inspection Service (USPIS) has a long tradition of protecting American citizens from these types of schemes and bringing those responsible to justice,” said Postal Inspector in Charge Juan A. Vargas of the USPIS Miami Division. “These guilty pleas are a testament to the dedicated partnership between the Department of Justice’s Consumer Protection Branch, Homeland Security Investigations (HSI), and the U.S. Postal Inspection Service to protect our citizens from these scams.”

“These guilty pleas are a result of the unwavering commitment and countless hours spent by HSI and our law enforcement partners to ensure that this investigation led the extradition of the two Nigerian nationals,” said Special Agent in Charge Scott Brown of HSI Arizona. “Operating a transnational inheritance fraud scheme that targets the elderly is not only morally reprehensible, it also undermines the financial systems we use and depend upon. I thank everyone who worked on this case. These two defendants are one step closer to facing much-deserved prison time.”

On May 18, Ozor pleaded guilty to conspiracy to commit mail and wire fraud. Abraham pleaded guilty to conspiracy to commit mail and wire fraud earlier today. Ozor is scheduled to be sentenced by U.S. District Judge Kathleen M. Williams on July 27. Judge Williams will sentence Abraham on Aug. 9. Both defendants face a maximum penalty of 20 years in prison.

The Consumer Protection Branch, USPIS, and HSI are investigating the case.

Senior Trial Attorney Phil Toomajian and Trial Attorneys Josh Rothman and Brianna Gardner of the Civil Division’s Consumer Protection Branch are prosecuting the case. The Justice Department’s Office of International Affairs, the U.S. Attorney’s Office for the Southern District of Florida, Europol, and authorities from the U.K., Spain, and Portugal all provided critical assistance.

If you or someone you know is age 60 or older and has been a victim of financial fraud, help is standing by at the National Elder Fraud Hotline: 1-833-FRAUD-11 (1-833-372-8311). This Justice Department hotline, managed by the Office for Victims of Crime, is staffed by experienced professionals who provide personalized support to callers by assessing the needs of the victim and identifying relevant next steps. Case managers will identify appropriate reporting agencies, provide information to callers to assist them in reporting, connect callers directly with appropriate agencies, and provide resources and referrals, on a case-by-case basis. Reporting is the first step. Reporting can help authorities identify those who commit fraud and reporting certain financial losses due to fraud as soon as possible can increase the likelihood of recovering losses. The hotline is open Monday through Friday from 10:00 a.m. to 6:00 p.m. ET. English, Spanish and other languages are available.

More information about the department’s efforts to help American seniors is available at its Elder Justice Initiative webpage. For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at www.justice.gov/civil/consumer-protection-branch. Elder fraud complaints may be filed with the FTC at www.ftccomplaintassistant.gov or at 877-FTC-HELP. The Justice Department provides a variety of resources relating to elder fraud victimization through its Office for Victims of Crime, which can be reached at www.ovc.gov.

Topic(s): Elder JusticeConsumer ProtectionComponent(s): Civil DivisionPress Release Number: 23-618

Updated June 1, 2023Original Article

Remarks as Prepared for Delivery

Thank you, Rosie, and good morning, everyone. As a lifelong advocate and a survivor, I’m honored to be here with all of you and to represent the Department of Justice at the release of the National Plan to End Gender-Based Violence: Strategies for Action.

At the Department of Justice, we know that sexual assault, domestic violence, stalking and human trafficking are serious violent crimes that make our nation less equal and less just. Only a comprehensive response that is deeply informed by survivors and historically marginalized communities can end gender-based violence.

I travel all over the country meeting with advocates, law enforcement, prosecutors and clinicians. They are doing whatever it takes to meet survivors where they are – both figuratively and literally. Just as laid out in this national plan, they are responding to the whole person, the whole community.

A family justice center in Louisiana is offering onsite forensic exams and primary health care and holistic wellness. But also housing and connections to jobs and options for survivors who aren’t sure about working with law enforcement yet.

A tribal program in California is waiting with kids every morning before they get on the school bus, to stop traffickers from approaching them and to build relationships that help prevent dating violence.

Federal prosecutors in Texas, Alabama, Oklahoma and more are reducing violent crime by partnering with service providers and prosecuting federal gun crimes committed by domestic violence perpetrators.

The Department of Justice is committed to making our communities safer by increasing access to justice, in all its forms. The Office on Violence Against Women alone has awarded over $9.5 billion under the Violence Against Women Act since it was first authorized. And that’s to say nothing of our colleagues at the Office for Victims of Crime, who award billions every year.

• On Monday, we announced the first-ever National Protocol for Intimate Partner Violence Medical Forensic Examinations.
  • The protocol gives guidance on caring for victims with compassion and respect, empowers patients to make decisions for their welfare, and instructs clinicians on collecting evidence should survivors opt for a criminal justice system response.

• Last year, the Department released guidance to improve law enforcement response to sexual assault and domestic violence by identifying and preventing gender bias, so that survivors who seek help can get it and law enforcement can more effectively fight these cries.
• Deputy Attorney General Lisa Monaco issued a memorandum reiterating the priority to address the disproportionately high rates of violence experienced by American Indians and Alaska Natives, and relatedly.
  • The memorandum directed each U.S. Attorney with Indian country jurisdiction to update and develop new plans for addressing missing and murdered persons crisis.
• DOJ has also spearheaded efforts to implement state of the art forensic telehealth centers to respond to gender-based violence survivors in rural and isolated communities in America, including remote villages in Alaska.
• Last April, the Civil Rights Division launched a Coordinating Committee to Combat Sexual Misconduct. In just one year, they have secured $3.75 million for victims and survivors, obtained 21 criminal convictions, filed nine civil complaints with 16 in active litigation, and trained more than 6,000 people.

These efforts are among many others that are creating systemic change. Together as federal agencies, we can end gender-based violence.

Speaker: Allison Randall, Acting DirectorTopic(s): Violent CrimeComponent(s): Office on Violence Against Women

Updated May 30, 2023Original Article

FOR IMMEDIATE RELEASE
Tuesday, May 30, 2023
Bodybuilding Coach Arrested for Child Exploitation

A bodybuilding coach was arrested today in Charlottesville, Virginia, for multiple child exploitation offenses.

According to court documents, between 2013 and April 2020, Elliott Simon Atwell, 33, of Charlottesville, allegedly enticed and coerced at least six minors to engage in sexually explicit conduct in order to produce recordings of the conduct. Atwell also allegedly enticed a minor to engage in criminal sexual activity and possessed images of minors – including prepubescent minors and minors under 12 years of age – who were engaged in sexually explicit conduct.

Atwell is charged with four counts of sexual exploitation of a minor, one count of enticement of a minor, and one count of possession of child pornography. If convicted, he faces a mandatory minimum sentence of 15 years and up to life in prison.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Christopher R. Kavanaugh for the Western District of Virginia, and Special Agent in Charge Stanley M. Meador of the FBI Richmond Field Office made the announcement.

The FBI is investigating the case.

Trial Attorney Jessica L. Urban of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Melanie Smith for the Western District of Virginia are prosecuting the case.

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

Any individuals who believe they or someone they know may have been victimized by Atwell are encouraged to contact the FBI at 1-800-CALL-FBI.

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

Topic(s): Project Safe ChildhoodComponent(s): Criminal DivisionCriminal – Child Exploitation and Obscenity SectionFederal Bureau of Investigation (FBI)USAO – Virginia, WesternPress Release Number: 23-613

Updated May 30, 2023Original Article

FOR IMMEDIATE RELEASE
Tuesday, May 30, 2023
Justice Department Highlights Initiatives to Prevent and Address Gender-Based Violence

This week, the Justice Department highlighted a series of initiatives aimed at preventing and addressing sexual violence, intimate partner violence, stalking, and other forms of gender-based violence (GBV). With its strong, longstanding commitment to upholding justice and pursuing equality for all, the Justice Department joins its partners across the federal government and communities nationwide to prioritize the safety of all survivors of GBV and lauds the White House’s recent release of the National Plan to End Gender-Based Violence: Strategies for Action.

“Gender-based violence violates fundamental human rights, destroys communities, and fosters social inequities,” said Associate Attorney General Vanita Gupta. “Identifying and preventing these crimes is a top department priority, underscored by this first-ever national plan and the government’s collective commitment to this cause. The Justice Department, with our federal partners, will continue to spotlight the repercussions of these crimes on society and applauds those who support survivors in restoring their sense of safety and well-being.”

GBV affects individuals from all walks of life and spans all ages, representing a significant public safety crisis. It pervades every sphere of human interaction, be it public or private. In our ever-connected world, this form of violence impacts communities nationwide and can often escalate under disaster, conflict or crisis conditions, including global health emergencies such as a pandemic.

During the Launch of the National Plan to End Gender-Based Violence, Acting Director Allison Randall of the Office on Violence Against Women (OVW) delivered remarks and facilitated a roundtable discussion with leaders, advocates, and survivors. “Sexual assault, domestic violence, stalking, and human trafficking are serious violent crimes that make our nation less equal and less just,” said Acting Director Randall. “Only a comprehensive response that is deeply informed by survivors and historically marginalized communities can end gender-based violence. Today we uplift the ongoing work of the Department of Justice and stand with colleagues across the federal government and with communities across the United States.”

The Justice Department’s work to respond to GBV is a whole-of-agency effort to provide comprehensive services for survivors and hold offenders accountable by enforcing the nation’s laws against these crimes. The department’s unwavering commitment to addressing GBV spans across funding, research, policy, technical assistance, training, and guidance that includes, but is not limited, to the following:

Funding

The OVW and the Office of Justice Programs (OJP) administer grants to prevent, address and coordinate community responses across the nation to address gender-based violence. Funding helps to strengthen the criminal justice system’s response, expand victim services, support community-based efforts and bolster prevention.

Of note, the Violence Against Women Act Reauthorization Act of 2022 (VAWA 2022) includes numerous improvements to legal tools and expansions to OVW grant programs addressing domestic violence, dating violence, sexual assault, and stalking. Also, each year, OJP’s Office for Victims of Crime (OVC) administers hundreds of millions of dollars to all states and territories for crime victim assistance and compensation, including for survivors of gender-based violence.

Policies and Guidance

• In October 2022, Attorney General Merrick B. Garland issued revised Attorney General Guidelines for Victim and Witness Assistance. The revised guidelines address the responsibilities of department employees when working with victims and witnesses of crime to ensure that they are treated with dignity and respect during criminal justice proceedings. The Guidelines address the myriad needs of survivors of gender-based violence.
• On May 23, the department released the National Protocol for Intimate Partner Violence Medical Forensic Examinations to guide the clinical practice of conducting comprehensive assessments for patients experiencing intimate partner violence (IPV) that prioritize the patient’s health and well-being.
• In April 2022, the department issued Federal Workplace Responses to Domestic Violence, Sexual Assault, and Stalking, an agency policy that aims to improve safety in the workplace for employees and contractors who could potentially be victims of such crimes.
• In May 2022, the department released updated guidance in Improving Law Enforcement Response to Sexual Assault and Domestic Violence by Identifying and Preventing Gender Bias aimed at enhancing law enforcement's approach to handling sexual assault and domestic violence cases by identifying and preventing gender bias.

Projects and Initiatives

• In April 2023, the Civil Rights Division’s Coordinating Committee to Combat Sexual Misconduct released a fact sheet showcasing its achievements in combatting sexual misconduct throughout the preceding year.
• In September 2022, OVC funded Restoring Youth: Supporting Sexual Abuse Survivors in Youth Detention, a program aimed at expanding services for sexual abuse survivors in youth detention. The project will build the capacity of four selected grantee partnership sites, comprised of youth detention facilities and community-based sexual abuse survivor service providers, to establish services for youth that are rooted in racial equity and accessible to survivors from traditionally underserved communities.
• OVC funded several initiatives to prevent Female Genital Mutilation or Cutting (FGM/C) including a Support Line for Survivors of FGM/C, an End FGM/C Network Resources Page, and a Voices to End FGM/C Digital Storytelling Project. They also funded two national trainings for maternal healthcare providers to address FGM/C in May of 2023.

• OVC funded the Youth Collaboratory to implement projects to prevent and reduce the victimization of Black girls vulnerable to sex trafficking by increasing the capacity of program providers and other stakeholders working to prevent the trafficking of Black girls. The projects included a three-part video series that amplified voices from the field-direct service professionals, researchers, youth and young adults with lived expertise, and multidisciplinary providers. Additionally, the Girls Action Board (GAB), a national leadership opportunity for youth and young adults (ages 18-24) with lived expertise, wrote and performed a collaborative poetry piece about the importance of centering Black girls.

Addressing Crimes Against American Indian and Alaska Native Communities

• In July 2022, Deputy Attorney General Lisa O. Monaco issued a memorandum reiterating the priority of the Department of Justice to address the disproportionately high rates of violence experienced by American Indians and Alaska Natives, and relatedly, the high rates impacting indigenous women and girls reported missing or murdered. The memorandum directed each U.S. Attorney with Indian country jurisdiction – along with their law enforcement partners at the Justice Department – to update and develop new plans for addressing missing and murdered persons crisis.

• On Aug. 8-10, the OVW will hold the 18th Annual OVW Government-to-Government Tribal Consultation on Violence Against Women in Tulsa, Oklahoma, on behalf of the Attorney General. The 2022 Tribal consultation report is available here.
• In December 2022, the OVC held its Tribal Nation’s Conference in Palm Springs, California, bringing together thousands of Tribal leaders, victim service providers, and criminal justice practitioners to address crime victimization in Indian Country, including all aspects of gender-based violence.
• In April 2022, OVW issued an interim final rule governing the Special Tribal Criminal Jurisdiction (STCJ) Reimbursement Program, a new program authorized under VAWA 2022 to reimburse Tribal governments for expenses incurred in exercising STCJ over non-Native individuals who commit certain covered crimes on tribal lands.
• OVC administers the Tribal Victim Services Set-Aside, which provides non-competitive grant funding to support victim services, including gender-based violence. Tribal set-aside awards support activities such as shelters, child advocacy centers, sexual assault services, community outreach and education; and other activities needed to address survivors in tribal communities.

Research and Data

• In May 2022, OVW released the FY 2023 Research and Evaluation Initiative to conduct research that facilitates researcher-practitioner partnerships and studies interventions that address domestic violence, sexual assault, dating violence, and stalking.
• In March 2023, the Department’s National Institute of Justice released a solicitation to conduct research and evaluation projects examining a broad range of topics, including the crimes of domestic and family violence, intimate partner violence, rape, sex trafficking, sexual assault, stalking, and teen dating violence, also known as adolescent relationship abuse, along with the associated criminal justice system response, procedures, and policies.
• The Bureau of Justice Statistics (BJS) maintains a collection of data that support efforts to address gender-based violence. These measures are collected on several BJS data collections, although the approach to measurement can vary depending on the collection and the year of administration: National Crime Victimization Survey, National Inmate Survey, National Survey of Youth in Custody, and Survey of Prison Inmates.

Topic(s): Violent CrimeComponent(s): Office of the Associate Attorney GeneralOffice on Violence Against WomenPress Release Number: 23-612

Updated May 30, 2023Original Article

FOR IMMEDIATE RELEASE
Tuesday, May 30, 2023
Kansas Man Indicted for Using Guns, Death Threats and Racial Slurs to Intimidate Black People

A Kansas man was indicted by a federal grand jury for using guns, death threats and racial slurs to intimidate Black people and interfere with multiple federally-protected rights.

The indictment alleges that, on July 27, 2022, Austin Schoemann, 30, of Wichita, brandished a firearm and used racial slurs in order to threaten two Black juveniles, Victims 1 and 2, while they were entering a QuikTrip gasoline station. In addition to intimidating and interfering with the two young men, Schoemann used his firearm to threaten a Black adult, Victim-3, who intervened in support of the juveniles’ federally-protected right to be free from racial discrimination when visiting a gasoline station. The indictment also charges Schoemann with using a firearm during and in relation to these crimes of violence.

The indictment further alleges that beginning in January 2022 and continuing through August 2022, Schoemann interfered with the federally-protected housing rights of a white woman, Victim-4, by making threats to hurt or kill any Black people who visited her home. The indictment alleges that Schoemann made many of these threats in-person, and that he would stand outside of Victim-4’s house and shout threats and racial slurs on occasions when he believed she had Black visitors in her house or planned to do so. Schoemann is also charged with two violations of using the internet to distribute videos and messages to Victim-4’s family members and others in which he repeatedly threatened to shoot and kill Black people.

Schoemann faces a maximum penalty of 10 years in prison for the firearms charges, a maximum penalty of five years in prison for distribution of threating messages online and a mandatory minimum of seven years in prison for brandishing a firearm during and in relation to a crime of violence.

Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division, U.S. Attorney Kate E. Brubacher for the District of Kansas and Special Agent in Charge Charles Dayoub of the FBI Kansas City Field Office made the announcement.

The FBI Kansas City Field Office investigated the case.

Assistant U.S. Attorney Aaron Smith for the District of Kansas and Trial Attorney Thomas Johnson of the Civil Rights Division’s Criminal Section are prosecuting the case.

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

Topic(s): Civil RightsComponent(s): Civil Rights DivisionCivil Rights – Criminal SectionFederal Bureau of Investigation (FBI)USAO – KansasPress Release Number: 23-611

Updated May 30, 2023Original Article

FOR IMMEDIATE RELEASE
Friday, May 26, 2023
Two Additional Oath Keepers Members Sentenced on Felony Charges Related to U.S. Capitol Breach

Two members of the Oath Keepers were sentenced today on felony and misdemeanor charges for crimes related to the breach of the U.S. Capitol on Jan. 6, 2021. Their actions disrupted a joint session of the U.S. Congress that was in the process of ascertaining and counting the electoral votes related to the presidential election.

Kenneth Harrelson, 42, of Titusville, Florida, was sentenced to four years in prison followed by two years of supervised release for obstruction of an official proceeding, conspiracy to prevent an officer from discharging duties, and tampering with documents or proceedings.

Jessica Watkins, 40, of Woodstock, Ohio, was sentenced to eight and a half years in prison followed by three years of supervised release for conspiracy to obstruct an official proceeding, obstruction of an official proceeding, interfering with law enforcement officers during a civil disorder, and conspiracy to prevent an officer from discharging duties. Both defendants were found guilty at trial in November 2022, along with co-defendants Elmer Stewart Rhodes and Kelly Meggs, who were sentenced earlier this week. Co-defendant Thomas Caldwell is awaiting sentencing. Co-conspirators Roberto Minuta, Edward Vallejo, Joseph Hackett, and David Moerschel — who were all found guilty at trial in January 2023 — are scheduled to be sentenced next week on June 1 and 2.

According to the government’s evidence, beginning in late December 2020, via encrypted and private communications applications, Harrelson, Watkins, Rhodes, Meggs, Caldwell, and others coordinated and planned to travel to Washington, D.C., on or around Jan. 6, 2021, the date of the certification of the electoral college vote. The defendants also, collectively, employed a variety of manners and means, including: organizing into teams that were prepared and willing to use force and to transport firearms and ammunition into Washington, D.C.; recruiting members and affiliates; organizing trainings to teach and learn paramilitary combat tactics; bringing and contributing paramilitary gear, weapons, and supplies – including knives, batons, camouflaged combat uniforms, tactical vests with plates, helmets, eye protection, and radio equipment – to the Capitol grounds; breaching and attempting to take control of the Capitol grounds and building on Jan. 6, 2021, in an effort to prevent, hinder and delay the certification of the electoral college vote; using force against law enforcement officers while inside the Capitol on Jan. 6, 2021; continuing to plot, after Jan. 6, 2021, to oppose by force the lawful transfer of presidential power, and using websites, social media, text messaging and encrypted messaging applications to communicate with each other and others.

On Jan. 6, 2021, a large crowd began to gather outside the Capitol perimeter as the Joint Session of Congress got under way at 1 p.m. Crowd members eventually forced their way through, up, and over U.S. Capitol Police barricades and advanced to the building’s exterior façade. Shortly after 2 p.m., crowd members forced entry into the Capitol by breaking windows, ramming open doors, and assaulting Capitol police and other law enforcement officers. At about this time, according to the government’s evidence, Rhodes entered the restricted area of the Capitol grounds and directed his followers to meet him at the Capitol.

At approximately 2:30 p.m., according to the government’s evidence, Meggs, Harrelson, and Watkins, along with other Oath Keepers and affiliates – many wearing paramilitary clothing and patches with the Oath Keepers name, logo, and insignia – marched in a “stack” formation up the east steps of the Capitol, joined a mob, and made their way into the Capitol. Rhodes and Caldwell remained outside the Capitol, where they coordinated activities.

While certain Oath Keepers members and affiliates breached the Capitol grounds and building, others remained stationed just outside of the city in quick reaction force (QRF) teams. According to the government’s evidence, the QRF teams were prepared to rapidly transport firearms and other weapons into Washington, D.C., in support of operations aimed at using force to stop the lawful transfer of presidential power.

Harrelson was arrested on March 10, 2021, in Florida. Watkins was arrested on Jan. 18, 2021, in Ohio.

The U.S. Attorney’s Office for the District of Columbia and the Department of Justice’s National Security and Criminal Divisions are prosecuting the case. Valuable assistance was provided by numerous U.S. Attorney’s Offices throughout the country.

The FBI Washington Field Office investigated the case with valuable assistance provided by numerous FBI offices throughout the country, including the Dallas, Cincinnati, Tampa, Jacksonville, and Richmond Field Offices.

In the 28 months since Jan. 6, 2021, more than 1,000 individuals have been arrested in nearly all 50 states for crimes related to the breach of the U.S. Capitol, including more than 320 individuals charged with assaulting or impeding law enforcement. The investigation remains ongoing.

Anyone with tips can call 1-800-CALL-FBI (800-225-5324) or visit tips.fbi.gov.

Topic(s): Domestic TerrorismComponent(s): Federal Bureau of Investigation (FBI)National Security Division (NSD)USAO – District of ColumbiaPress Release Number: 23-610

Updated May 26, 2023Original Article

FOR IMMEDIATE RELEASE
Friday, May 26, 2023
Illegal Agents of the PRC Government Charged for PRC-Directed Bribery Scheme

John Chen and Lin Feng Allegedly Furthered the PRC Government’s Transnational Repression Campaign Against the Falun Gong by Bribing a Purported IRS Official

A federal court in the Southern District of New York today unsealed a complaint charging two individuals with acting and conspiring to act in the United States as unregistered agents of the People’s Republic of China (PRC), conspiring to bribe and bribing a public official, and conspiracy to commit money laundering.

According to the complaint, John Chen, aka Chen Jun, 70, a Los Angeles resident and former citizen of the PRC, and Lin Feng, a Los Angeles resident and PRC citizen, allegedly participated in a PRC Government-directed scheme targeting U.S.-based practitioners of Falun Gong — a spiritual practice banned in the PRC. Chen and Feng were arrested today in the Central District of California.

“The Chinese government has yet again attempted, and failed, to target critics of the PRC here in the United States,” said Attorney General Merrick B. Garland. “We allege the defendants in this case attempted to bribe someone they thought was an IRS agent in order to further the Chinese government’s campaign of transnational repression in the United States. But the individual they attempted to bribe was in fact an undercover law enforcement agent, and both defendants were arrested this morning. The Justice Department will continue to investigate, disrupt, and prosecute efforts by the PRC government to silence its critics and extend the reaches of its regime onto U.S. soil. We will never stop working to defend the rights to which every person in the United States is entitled.”

“The Department of Justice continues to expose the Chinese government’s brazen attempts to perpetrate transnational repression, this time through attempted bribery,” said Deputy Attorney General Lisa O. Monaco. “As highlighted by today’s arrests and charges of conspiracy, bribery, and money laundering, we will not tolerate efforts by the PRC or any foreign government to intimidate, harass, or undermine the rights and freedoms enjoyed by all who live in the United States.”

“China’s government has once again shown its disregard for the rule of law and international norms,” said FBI Director Christopher Wray. “The FBI will not tolerate CCP repression — its efforts to threaten, harass, and intimidate people — here in the United States. We will continue to confront the Chinese government’s efforts to violate our laws and repress the rights and freedoms of people in our country.”“No other nation poses as severe a threat to the democratic values of the United States as the government of the People’s Republic of China,” said FBI Deputy Director Paul Abbate. “The FBI will not stand by as the PRC attempts to weaponize our institutions and programs and attack the rights of those on U.S. soil. Any attempt to repress or harass individuals runs directly counter to the ideals our nation was founded upon, and it simply will not be tolerated. The FBI and our partners remain committed to confronting the illegal conduct of the PRC government that threatens our national security and freedom.”

“John Chen and Lin Feng allegedly waged a campaign at the behest of the Government of the People’s Republic of China to influence a U.S. Government official in order to further the PRC Government’s repression of practitioners of Falun Gong,” said U.S. Attorney Damian Williams for the Southern District of New York. “Efforts to manipulate and use the arms of the U.S. Government to carry out the PRC Government’s autocratic aims are as shocking as they are insidious. My office will work vigorously to protect against malign foreign influences.”

The complaint alleges that from at least approximately January 2023 to May 2023, Chen and Feng worked inside the United States at the direction of the PRC government, including an identified PRC government official (PRC Official-1), to further the PRC government’s campaign to repress and harass Falun Gong practitioners. The PRC Government has designated the Falun Gong as one of the “five poisons,” or one of the top five threats to its rule. In China, Falun Gong adherents face a range of repressive and punitive measures from the PRC government, including imprisonment and torture.

As part of the PRC government’s campaign against the Falun Gong, Chen and Feng allegedly engaged in a PRC government-directed scheme to manipulate the IRS’s Whistleblower Program in an effort to strip the tax-exempt status of an entity run and maintained by Falun Gong practitioners (Entity-1). After Chen filed a defective whistleblower complaint with the IRS (the Chen Whistleblower Complaint), Chen and Feng paid $5,000 in cash bribes, and promised to pay substantially more, to a purported IRS agent who was in fact an undercover officer (Agent-1), in exchange for Agent-1’s assistance in advancing the complaint. Neither Chen nor Feng notified the Attorney General that they were acting as agents of the PRC government in the United States.

In the course of the scheme, Chen, on a recorded call, explicitly noted that the purpose of paying these bribes, which were directed and funded by the PRC government, was to carry out the PRC government’s aim of “toppl[ing] . . . the Falun Gong.” During a call intercepted pursuant to a judicially authorized wiretap, Chen and Feng discussed receiving “direction” on the bribery scheme from PRC Official-1, deleting instructions received from PRC Official-1 in order to evade detection, and “alert[ing]” and “sound[ing] the alarm” to PRC Official-1 if Chen and Feng’s meetings to bribe Agent-1 did not go as planned. Chen and Feng also discussed that PRC Official-1 was the PRC Government official “in charge” of the bribery scheme targeting the Falun Gong.

As part of this scheme, Chen and Feng allegedly met with Agent-1 in Newburgh, New York, on May 14. During the meeting, Chen gave Agent-1 a $1,000 cash bribe as an initial, partial bribe payment. Chen further offered to pay Agent-1 a total of $50,000 for opening an audit of Entity-1, as well as 60% of any whistleblower award from the IRS if the Chen Whistleblower Complaint were successful. On May 18, Feng paid Agent-1 a $4,000 cash bribe at John F. Kennedy International Airport as an additional partial bribe payment in furtherance of the scheme. Chen allegedly obtained funding from the PRC government to make bribe payments during his trips to the PRC in the course of the scheme.

Chen and Feng are each charged with (1) one count of conspiring to act as an agent of a foreign government without notifying the Attorney General and to bribe a public official, which carries a maximum sentence of five years in prison; (2) one count of acting as an agent of a foreign government without notifying the Attorney General, which carries a maximum sentence of 10 years in prison; (3) one count of bribing a public official, which carries a maximum sentence of 15 years in prison; and (4) one count of conspiring to commit international money laundering, which carries a maximum sentence of 20 years in prison.

The FBI New York and Los Angeles Field Offices and Counterintelligence Division are investigating the case with valuable assistance provided by the Treasury Inspector General for Tax Administration (TIGTA).

Assistant U.S. Attorneys Shiva H. Logarajah, Qais Ghafary, Michael D. Lockard, and Kathryn Wheelock for the Southern District of New York and Trial Attorney Christina A. Clark of the Counterintelligence and Export Control Section are prosecuting the case.

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

Attachment(s): Download John Chen complaintTopic(s): Countering Nation-State ThreatsComponent(s): Federal Bureau of Investigation (FBI)National Security Division (NSD)Office of the Attorney GeneralOffice of the Deputy Attorney GeneralUSAO – New York, SouthernPress Release Number: 23-609

Updated May 26, 2023Original Article

FOR IMMEDIATE RELEASE
Monday, May 22, 2023
U.S. Law Enforcement Disrupts Networks Used to Transfer Fraud Proceeds, Taking Over 4,000 Actions in Fifth Campaign

Over 12,000 Actions Taken Since Campaigns Began

The Justice Department, FBI, U.S. Postal Inspection Service (USPIS), and other federal law enforcement agencies announced today the completion of a three-month campaign that disrupted networks used by foreign fraudsters to obtain fraud proceeds. Multiple law enforcement actions addressed conduct by individuals sometimes referred to as “money mules,” who have been providing critical services to fraudsters by receiving money from fraud victims and forwarding the fraud proceeds to the perpetrators (many of whom are based overseas). Some individuals knew they were facilitating fraud, while others first interacted with fraudsters as victims and may have been unaware that their activity furthered criminal activity.

Over approximately the last three months, law enforcement took over 4,000 actions against individuals responsible for facilitating a range of fraud schemes. These schemes included those that targeted consumers, such as lottery fraud and romance scams, as well as those that targeted businesses or pandemic funds.

The thousands of actions taken by law enforcement — which ranged from criminal prosecutions to civil actions, to warning letters — were designed to punish those who knowingly assisted fraudsters and to advise those who may have been unknowingly helping fraudsters that their conduct furthered crime. These actions are intended to deter overseas fraudsters from relying on U.S.-based individuals to facilitate schemes and thereby reduce the harm caused by foreign fraud operations.

This year’s effort marked the fifth U.S. law enforcement campaign disrupting these money transmitting networks. Since the first campaign, during which approximately 400 actions were taken by law enforcement, agencies have collectively taken over 12,000 actions. Investigations have shown that disrupting money transmitting networks has impeded fraudsters’ abilities to receive funds, thereby reducing fraud victimization. These campaigns are part of a global effort to tackle money transmitting networks linked to illegal activity.

“Law enforcement is committed to reducing fraud using every tool at our disposal. Our efforts to disrupt networks used to transfer fraud proceeds, to educate the public about elder fraud, and to prosecute those involved in these schemes have stymied fraudsters,” said Associate Attorney General Vanita Gupta. “This initiative demonstrates what can be achieved through focused efforts and vigorous enforcement.”

“The money mule campaign was an effort to educate the public, disrupt criminal enterprises, and provide feedback to financial institutions who go to great lengths to implement anti-money laundering programs,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “The FBI values the partnership of the Justice Department's Consumer Protection Branch, USPIS, and other federal agencies who work together to disrupt criminal enterprises conducting fraud and money laundering schemes.”

“Anyone can be approached to be a money mule, but criminals often target students, those looking for work, and those on dating websites,” said USPIS Inspector in Charge Eric Shen of the Criminal Investigations Group. “When those individuals use the U.S. Mail to send or receive funds from fraudsters, postal inspectors are quick to step in and put a stop to money mule activities.”

This year’s effort was coordinated by the Justice Department's Consumer Protection Branch, FBI and USPIS, which were joined by Homeland Security Investigations, the Department of Labor Office of Inspector General and the Small Business Administration Office of Inspector General. Participating agencies collectively served over 4,000 letters warning individuals that their activities are facilitating fraud. These letters outlined the potential consequences for continuing to transmit illegally acquired funds. Participating agencies also filed 12 civil or administrative actions. Additionally, more than 25 individuals were criminally charged for knowingly receiving and forwarding victim funds or otherwise laundering fraud proceeds.

• The U.S. Attorney’s Office for the District Massachusetts charged a defendant for using his accounting and “virtual CFO” business as a front to launder the proceeds of internet fraud schemes. As part of the alleged conspiracy, the defendant created dozens of shell companies and used those shell companies to open business bank accounts in Rhode Island and Massachusetts, through which the defendant laundered the criminal proceeds for his clients in exchange for fees. In total, since 2019, the defendant is alleged to have opened approximately 80 bank accounts (purportedly on behalf of 65 different companies), laundering approximately $35 million.

• The U.S. Attorney’s Office for the Western District of North Carolina charged an individual for facilitating an international, multimillion-dollar tech support fraud. The indictment alleged that the defendant agreed to obtain payment-processing services in his name to process victim payments and laundered the proceeds domestically and internationally to bank accounts located in India, receiving 3% of the revenue in return.

• The U.S. Attorneys' Offices for the Central District of California and the District of Nebraska charged individuals who, despite warnings from law enforcement, continued facilitating fraud. In the Central District of California, an individual was charged for her role in receiving funds from fraud victims, including victims of business email compromises. According to the charges, the defendant opened 11 bank accounts at seven separate financial institutions in furtherance of the scheme. In the District of Nebraska, two individuals were charged for facilitating a lottery fraud scheme, including by receiving cashier’s checks in the mail.

As in past years, participating agencies are working to raise awareness about how fraudsters recruit and use individuals to assist their fraud operations. Federal agencies conducted outreach to the public and industry, and also expanded partnerships with local, state, and foreign law enforcement agencies. The Commodities Futures Trading Commission released a public awareness message about how fraudsters use and recruit people to facilitate romance fraud and “wrong number” text message scams, where fraudsters strike up conversations touting their wealth and success in trading crypto assets, over-the-counter foreign currency, or gold contracts to try and convince consumers to “invest” in crypto assets.

The agencies involved in this effort urge consumers to be on the lookout for signs someone is trying to recruit them to receive and transmit fraud proceeds. Do not agree to receive money or checks mailed to you or sent to your bank account for someone you have met over the phone or online. Do not open a bank or cryptocurrency account at someone else’s direction. Fraudsters will lie to persuade you to help them. They may falsely tell you that they are helping you get a lottery prize, initiate a purported romantic relationship and then tell you that they need money, or pretend to offer you a job, an opportunity to invest in a business venture, or the chance to help in a charitable effort.

For more information on this initiative, please visit www.justice.gov/civil/consumer-protection-branch/money-mule-initiative.

Information about the Department of Justice’s Elder Fraud Initiative is available at www.justice.gov/elderjustice. If you or someone you know is age 60 or older and has been a victim of financial fraud, help is available at the National Elder Fraud Hotline: 1-833-FRAUD-11 (1-833-372-8311).

Information about the Justice Department's COVID-19 Fraud Enforcement Task Force is available at www.justice.gov/coronavirus.

For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at www.justice.gov/civil/consumer-protection-branch.

A criminal indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Topic(s): Elder JusticeFinancial FraudComponent(s): Civil DivisionFederal Bureau of Investigation (FBI)Press Release Number: 23-589

Updated May 22, 2023Original Article

Remarks as Prepared for Delivery

Good morning, everyone. I am honored to be here with such a huge crowd of passionate first responders and advocates and experts and survivors.

If you don’t know the Office on Violence Against Women (OVW), we are a less huge but equally passionate crowd of first responders and advocates and experts and survivors.

We administer the Violence Against Women Act, which this year means we have $700 million to invest in the work you all are doing on the front lines making change in your communities.

We want our grants and our policy work to be truly effective. And to be effective, we must be guided by the people who are on the ground, the real experts, who are building community-based responses – basically, guided by the people who are represented here in this room today and united by the same mission.

You are among the first people a survivor encounters in the aftermath of violence, and the way you respond can make the difference between a survivor getting access to justice and a survivor getting revictimized by the system.

All survivors deserve meaningful access to justice. And for many survivors, that does not involve the criminal justice system.

They are seeking other options. They need something between 911 and nothing, a pathway to safety and accountability.

But many survivors do want the criminal justice system to provide that safety and accountability. They want to be heard and believed in court.

And to do that they often need a supportive health care provider, a patient-centered response to trauma and sensitive evidence-collection.

Evidence collection has changed so much over the years. When I was starting out working in shelters in the 90’s, our evidence collection for domestic violence was polaroid pictures – anyone remember that?

I also remember a lot of survivors who I failed.

One woman had been strangled and had crashed through a glass window to escape. Neither the police nor I realized that was a medical emergency or what physical evidence they could have gathered. They just dropped her off at the shelter with bits of glass still in her hair.

And I don’t know how she fared, because she walked out of the shelter and into the Florida night and never came back. She didn’t even have shoes with her.

What if, instead, she had been offered trauma-informed support that met her medical needs and, if she wanted, collected evidence that could help her stay safe and get justice?

That is why I today I am profoundly honored and excited to announce the release of the first-ever National Protocol for Intimate Partner Violence Medical Forensic Examinations.

The protocol guides the clinical practice for conducting medical forensic exams for patients experiencing intimate partner violence, or IPV.

While many IPV victims seek medical assistance for injuries, in the past, most IPV health care protocols focused on screening rather than forensic exams or collecting evidence – evidence that not only supports investigation and prosecution, but can also validate what a survivor has experienced. That’s important when you’ve been gaslit and you haven’t been believed and you’re not sure what to do next.

By bringing together trauma-informed, patient-centered care, with screening and evidence collection, this protocol connects survivors’ needs with an evidence-based medical forensic examination that, if implemented correctly, will enhance communities’ responses to IPV.

I got to visit the New Orleans Family Justice Center earlier this year. Their HOPE Clinic provides onsite forensic exams for IPV, but that’s not all – they provide primary care and behavioral health services, too.

The Family Justice Center also offers a wellness program with a range of alternative healing modalities for survivors. Their process for forensic exams ensures that survivors are fully informed and in control of the process.

But not everyone is there yet, and that’s why we need a protocol.

For example, the International Association of Forensic Nurses (IAFN), OVW’s collaborative partner in developing the protocol, got a technical assistance request about an IPV survivor who sought medical care a couple of years ago. This survivor was not ready to report the abuse to law enforcement.

But, despite the absence of mandatory reporting requirements in their jurisdiction, the healthcare institution reported the assault to law enforcement.

They also called child protective services, even though the children were not present during the assault.

This was a violation of the state law and the patient’s privacy rights.

And it put her safety in jeopardy – she had not left the abusive relationship and she just needed to get medical care and document the injuries so she would have options in the future.

No one should have their life endangered or risk losing custody of their children because they sought a forensic exam. Will that survivor ever go back for help after that experience? Probably not, which is not going to keep her, or her kids, or her community safe.

The new protocol will help clinicians avoid that outcome.

It helps ensure that victims will be cared for with compassion and respect after an assault. Clinicians can offer survivors an assortment of choices, empowering them to make the decisions that they know are best for their welfare and that of their loved ones.

Last year, we came to the Conference on Crimes Against Women (CCAW) to announce our updated guidance on Improving Law Enforcement Response to Sexual Assault and Domestic Violence by Identifying and Preventing Gender Bias. Many of you exemplify the principles of that guidance and you are putting the “coordinate” into coordinated community response.

Our technical assistance providers like the International Association of Chiefs of Police, Police Executives Research Forum and the Law Enforcement Training and Technical Assistance Consortium can help if you need a little more support.

The new National Protocol for IPV Medical Forensic Examinations fits really well into a coordinated community response and ties in with the policing principles, so consider bringing those two pieces of guidance together when you get home and are connecting with your partner agencies.

We are profoundly grateful to the talented staff at IAFN, who also brought together 16 project partners from various disciplines to work on it. A much longer list of organizations participated in the extensive review process. Thanks to all of you who played a part.

IAFN also has technical assistance available on both IPV and sexual assault forensic exams at SAFEta.org.

I hope this guidance will prove a useful tool in helping you support survivors and address violence in your communities.

At OVW, we are relentlessly focused on changing the world by supporting all of you. Please help us do that by applying for OVW grants – we want to help you succeed.

Thank you to Jan Langbein and everyone at CCAW for bringing us together for this astounding conference. And thank you to the direct service providers, clinicians and first responders here today.

Creating options and choices – and supporting what survivors tell us they need, not what we think we should give them – is how we increase access to justice. It’s how we advance equity. It’s how we end gender-based violence.

Thank you.

Speaker: Allison Randall, Acting DirectorTopic(s): Violent CrimeComponent(s): Office on Violence Against Women

Updated May 22, 2023Original Article

FOR IMMEDIATE RELEASE
Monday, May 22, 2023
Justice Department Secures Settlement with New Jersey IT Recruiting Firm to Resolve Immigration-Related Discrimination Claims

The Justice Department announced today that it has secured a settlement agreement with Infosoft Solutions Inc., a New Jersey IT recruiting and contracting company operating as KForce Tech LLC. The settlement resolves the department’s determination that Infosoft violated the Immigration and Nationality Act (INA) by posting six discriminatory job advertisements that solicited applications only from non-U.S. citizens who needed visa sponsorship and, in one case, also sought applicants only from India.

“When employers advertise jobs only to applicants from a certain country or who need temporary visas, they discourage all other eligible workers and deny them a fair chance to be considered,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Civil Rights Division will not tolerate national origin or citizenship status discrimination and is committed to knocking down these unlawful discriminatory barriers.”

The department’s investigation determined that between July 2021 and August 2021, Infosoft posted at least six job advertisements inviting applications only from applicants who wanted sponsorship to work in the United States or who already had an employment-based temporary visa. One of the six advertisements also required the candidates to be from India. In doing so, the company deterred workers with permission to work in the United States without sponsorship (such as asylees, refugees, lawful permanent residents, U.S. nationals and U.S. citizens) from applying to the job advertisements and being fairly considered for the employment opportunities. The INA’s anti-discrimination provision generally prohibits employers from recruiting or refusing to hire workers based on their citizenship status or national origin.

Under the settlement, Infosoft will pay $25,500 in civil penalties to the United States. The agreement also requires the company to train its recruiters on the INA’s requirements, revise its employment policies and be subject to departmental monitoring and reporting requirements.

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

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

Spanish version

Attachment(s): Download sa_kforce_48-770_fnl_clean_ocred.pdfTopic(s): Labor & EmploymentCivil RightsComponent(s): Civil Rights DivisionCivil Rights – Immigrant and Employee Rights SectionPress Release Number: 23-588

Updated May 22, 2023Original Article