<h2>New Orleans Business Owner and Doctor Sentenced to Prison for Roles in $34 Million Medicare Fraud Scheme</h2>
<p>The owner of a New Orleans medical service company and a doctor who served as the company’s medical director were sentenced to prison today for their involvement in a $34 million Medicare fraud scheme.</p>
<p>Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Kenneth A. Polite of the Eastern District of Louisiana, Special Agent in Charge Jeffrey S. Sallet of the FBI’s New Orleans Field Office and Special Agent in Charge C.J. Porter of the U.S. Department of Health and Human Services-Office of Inspector General’s (HHS-OIG) Dallas Regional Office made the announcement.</p>
<p>Elaine Davis, 60, of New Orleans, and Pramela Ganji, M.D., 67, of Harahan, Louisiana, were sentenced to 96 months and 72 months in prison, respectively. Chief U.S. District Judge Kurt D. Engelhardt of the Eastern District of Louisiana imposed the sentences and scheduled a hearing to determine restitution owed by both defendants for Dec. 7, 2016. On March 17, 2016, a jury convicted Davis and Ganji each of <em><strong>one count of conspiracy to commit health care fraud and one count of health care fraud</strong></em>.</p>
<p>According to evidence introduced at trial, Davis directed a massive fraud scheme through Christian Home Health Inc. (Christian), a company that used elderly and disabled Medicare recipients in New Orleans and adjacent communities to fraudulently bill Medicare for purported home health care services. Ganji served as Christian’s medical director from 2010 through 2015. Evidence presented at trial showed that the vast majority of these patients did not require home health care services, and that Ganji falsely claimed that beneficiaries she had never examined were qualified to receive these services.</p>
<p>The evidence at trial demonstrated that Davis and Ganji caused Christian to bill Medicare for more than $34.4 million in claims, a vast percentage of which were fraudulent. Medicare paid more than $29.6 million on these claims.</p>
<p>The FBI and HHS-OIG investigated the case. Trial Attorneys William Kanellis, Antonio Pozos and Drew Bradylyons of the Criminal Division’s Fraud Section prosecuted the case.</p>
<p><a href="https://www.justice.gov/opa/pr/new-orleans-business-owner-and-doctor-sentenced-prison-roles-34-million-medicare-fraud-scheme">Original PressReleases&#8230;</a></p>

Category Archives: Fraud News From World
A “Fraud News From World” directory is a collection of news articles about fraud and scams from around the world. These directories can be a valuable resource for staying informed about the latest scams and how to protect yourself from them. The directory typically includes information about the scam, such as the type of scam, the target audience, the location of the scam, and the date of the scam. It may also include information about how to protect yourself from the scam, such as how to identify a phishing email or how to report a scam to the authorities.
Healthcare Fraud: CEO Jeffrey Eugene Rose And Pamela Annette Rose Convicted Of Conspiracy, Health Care Fraud, Wire Fraud and Money Laundering
<h2>CEO, CFO and VP Convicted in Nationwide Worker&#8217;s Compensation Fraud Scheme</h2>
<p>HOUSTON &#8211; Several officials with Team Work Ready (TWR) have been convicted of conspiracy, health care fraud, wire fraud and money laundering, announced U.S. Attorney Kenneth Magidson. TWR had clinics in five states including Federal Work Ready in Houston, Alamo Work Ready in San Antonio and Bayou Work Ready in New Orleans, Louisiana.</p>
<p>The federal jury deliberated for 14 hours following a 16-day trial before convicting CEO Jeffrey Eugene Rose Sr., 54, chief financial officer Pamela Annette Rose, 55, along with the clinic’s vice president of operations Frankie Lee Sanders, 55. The verdicts were returned late yesterday.</p>
<p>Today, the same jury heard evidence on forfeiture matters and returned a special verdict forfeiting $220,807, an annuity contract and real property.</p>
<p>During the criminal trial, the jury heard testimony from 38 witnesses including former patients of TWR clinics, former employees of TWR clinics, various experts and special agents from the U.S. Postal Service &#8211; Office of Inspector General (USPS-OIG) and IRS &#8211; Criminal Investigation (CI). According to testimony, TWR submitted approximately $9.6 million in false and fraudulent claims from four of its clinics for physical therapy services that were not provided. The claims were submitted under the Federal Employees Compensation Act (FECA) health care benefit program which is administered by the Department of Labor &#8211; Office of Worker’s Compensation Program (DOL-OWCP).</p>
<p>DOL-OWCP&#8217;s chief fiscal officer explained to the jury at the start of the trial that FECA does not pay for professional services performed by unlicensed aides which is why DOL-OWCP requires the enrollment of all licensed professionals providing services to injured federal employees, including copies of professional licenses. He testified that the FECA program only considers chiropractors as physicians when they treat spinal subluxation. Otherwise, chiropractors are considered equivalent to physical therapists and may provide physical therapy under the direction of, and as prescribed by, a medical doctor. Specifically, in relation to this case, the DOL-OWCP would not have paid millions of dollars for the physical therapy services billed by TWR if they had known that the services were not provided as described in the claims submitted to DOL-OWCP.</p>
<p>The claims TWR submitted falsely and fraudulently described skilled one-on-one physical therapy services provided by a licensed chiropractor. Patients from four TWR clinics testified that they did not receive the one-on-one physical therapy services paid for by DOL-OWCP under FECA. Rather, they stated that they exercised independently on treadmills, bicycles and elliptical machines with the Nintendo Wii game and with other pieces of exercise equipment. The San Antonio clinic also had an electronic massage chair for patients. One patient from Houston testified that she felt that some of the exercises she was asked to do had nothing to do with her carpal tunnel wrist injury, specifically the treadmill. Another patient from the San Antonio clinic testified that unlicensed staff told him to do exercises on both of his arms, although he only injured his left elbow and to use the electronic massage chair and the treadmill for his injury.</p>
<p>The jury also heard testimony from 11 former TWR employees, including unlicensed therapy technicians from the Houston and New Orleans clinics, a case manager and two licensed chiropractors. The employees reported 30 – 60 patients a day at the Houston clinic and said there were times when they did not know what the patients were doing in the main treatment area because they were busy in the back doing massages, electrical stimulation treatments and ultrasound treatments. The employees testified that they did not perform all the one-on-one services documented on patient treatment notes and admitted they frequently completed the patient treatment notes at the end of the day by following a “cheat sheet” and asking each other and the patients what activities had been done. Patients at the New Orleans clinic were instructed to go back to the therapy room to begin doing exercises by themselves. Various individuals described the treatment as “like a gym.”</p>
<p>The jury also heard from two federal agents who went undercover as “injured federal employees” at the Houston and New Orleans clinics. The jury watched portions of video recordings covertly made by the undercover agents that showed patients independently exercising and receiving care from unlicensed and obviously untrained staff.</p>
<p>One of the licensed chiropractors testified that she began covertly recording meetings with the defendants in December 2012. The jury heard several of the recordings, including one in which the defendants tried to coerce the chiropractor to order medically unnecessary treatment so TWR could make a profit.</p>
<p>TWR&#8217;s former chief operating officer (COO) testified about a phone call he received from CFO Rose on July 11, 2013 &#8211; the day federal agents executed search warrants at TWR clinics in Houston and New Orleans. The COO said CFO Rose instructed him to meet her and CEO Rose at a local Chase bank where they moved money out of the TWR accounts to hide it from the federal government. An IRS-CI special agent traced the $700,000 transferred out of TWR bank accounts, into a transportation company account owned by Mr. and Mrs. Rose and then out of that account via a cashier’s check in the name of two “shell” businesses not associated with TWR but also owned by Mr. and Mrs. Rose.</p>
<p>Sanders and Jeffrey Rose have been in custody where they will remain pending sentencing, set for January 2017. Pamela Rose was permitted to remain on bond.</p>
<p>The possible punishment for a conviction of conspiracy to commit health care fraud, health care fraud and engaging in a monetary transaction in criminally derived property is up to 10 years in federal prison and a $250,000 fine. They also face a maximum of 20 years in prison for the wire fraud and money laundering convictions.</p>
<p>This case was the result of a joint investigation with the USPS &#8211; OIG, DOL &#8211; OIG, IRS &#8211; CI, Department of Veterans Affairs &#8211; OIG, and Department of Homeland Security &#8211; OIG. Assistant United States Attorneys (AUSA) Julie Redlinger and Daniel Rodriguez prosecuted the case. AUSA Kristine Rollinson handled the forfeiture matters.</p>
<p><a href="https://www.justice.gov/usao-sdtx/pr/ceo-cfo-and-vp-convicted-nationwide-workers-compensation-fraud-scheme">Original PressReleases&#8230;</a></p>

Tax Fraud: Kioni Dogan Charging With The Unemployment Fraud Indictment
<h2>Former Stockton Woman Indicted with Others in Two Fraud Conspiracies</h2>
<p>SACRAMENTO, Calif. — On Thursday, October 13, 2016, a federal grand jury returned two indictments charging Kioni Dogan, 36, of Las Vegas and formerly of Stockton, with a total of 21 fraud counts related to claims for unemployment benefits and tax refunds, Acting U.S. Attorney Phillip A. Talbert announced.</p>
<p>The unemployment fraud indictment, charges Dogan, along with Gloria Harris, 56, of Stockton, and Lavonda Bailey, 34, of Las Vegas, with one count of conspiracy to commit mail fraud. It also charges Dogan with 15 counts of mail fraud. According to court documents, Dogan operated a “fictitious employer” scheme. Dogan created an employer with the California Employment Development Department (EDD) that was fictitious and did not conduct any business. Dogan then caused the submission of information to the EDD falsely indicating that various persons were employed by the fictitious entity. Dogan subsequently filed unemployment claims in the names of the fake employees. Harris and Bailey are among the individuals who collected the fraudulent benefits, both in their own names and in the names of other fake employees. The total loss to the California EDD is alleged to be over $2 million.</p>
<p>This is the third indictment returned as a result of the unemployment fraud investigation. On September 15, 2016, Herbert Alexander, 69, of Stockton was charged with unemployment fraud. On December 30, 2015, Deborah Hollimon of Stockton and West Memphis, Arkansas, was charged with unemployment fraud and identity theft.</p>
<p>The tax fraud indictment charges Dogan and Antonia L. Brasley, 47, of Stockton, with one count of conspiracy to submit false claims for tax refunds. It also charges Dogan with four individual counts of submitting false claims. According to court documents, from May 2011 through April 2012, Dogan and Brasley participated in a conspiracy to submit false tax returns to the IRS by obtaining personal identifying information from family, friends, and others, and then submitting returns seeking refunds to which the people listed on the returns were not entitled. To pursue the refunds, false statements were placed on the returns regarding income, withholding from income, and gambling losses, with fraudulent supporting tax forms known as W2-Gs. Dogan is also charged with making false claims in connection with four returns filed in January 2012, each seeking thousands of dollars in tax refunds.</p>
<p>The unemployment fraud case is the product of an investigation by the U.S. Department of Labor, the California Employment Development Department, and the U.S. Postal Inspection Service. Assistant U.S. Attorney Jared C. Dolan is prosecuting the case. The tax fraud case was the product of an investigation by the Internal Revenue Service Criminal Investigation. Assistant U.S. Attorney Christopher S. Hales is prosecuting the case.</p>
<p>If convicted of the unemployment benefits fraud, Dogan, Harris, and Bailey face a maximum statutory penalty of 20 years in prison and a $250,000 fine as to each count. If convicted in the tax fraud case of conspiracy to submit false claims, Dogan and Bralsey each face a maximum statutory penalty of 10 years in prison and a $250,000 fine. If convicted on the tax-related false claims counts, Dogan faces a maximum statutory penalty of five years in prison and a $250,000 fine for each count. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.</p>
<p><a href="https://www.justice.gov/usao-edca/pr/former-stockton-woman-indicted-others-two-fraud-conspiracies">Original PressReleases&#8230;</a></p>

Healthcare Fraud: Phillip M. Henderson Sentenced For Defrauding the Veterans Health Administration
<h2>Kentucky veteran sentenced to two years in prison after federal jury found him guilty of defrauding the Veterans Health Administration</h2>
<p>HUNTINGTON, W.Va. – A Kentucky man was sentenced today to two years in federal prison and ordered to pay $789,472 in restitution for defrauding the Veterans Health Administration, announced United States Attorney Carol Casto. Phillip M. Henderson, 51, of Olive Hill, was previously found guilty by a federal jury sitting in Huntington following a five-day jury trial. The jury required only an hour of deliberations before finding Henderson guilty.</p>
<p>Henderson served in the United States Army from 1983 to 1986. After he was discharged, Henderson filed multiple claims for benefits with the United States Department of Veterans Affairs (VA). In 1995, Henderson received a diagnosis from the VA of Retinitis Pigmentosa, an inherited and degenerative eye disease which can lead to total blindness. After this diagnosis, Henderson continued to undergo VA eye examinations through 2013, during which time VA medical staff continued to conduct tests to determine the extent of his vision loss. The results of these tests relied significantly, if not completely, on Henderson’s cooperation and accurate reporting of his vision levels.</p>
<p>Witnesses for the United States, including four medical doctors, testified that Henderson falsely responded to the vision testing and significantly misrepresented his vision loss. Witnesses further testified that Henderson pretended he could barely read the letters on the eye charts and pretended that his peripheral vision was severely reduced. As part of his scheme to defraud the VA, Henderson did not reveal that he had a Kentucky driver’s license and that he could and did drive.</p>
<p>Henderson received the maximum disability and healthcare benefits he could get for his claimed disability and vision loss. VA benefits representatives testified that from 1996 to 2015, Henderson received approximately $697,000 in disability compensation. In addition to this monthly monetary compensation, Henderson also received an $11,000 grant to purchase an automobile in 2006, which was intended for another person to drive Henderson, and another $10,000 grant towards the installation of an in-ground swimming pool, which was intended for his exercise and to maintain his well-being as a blind veteran. Furthermore, Henderson received the maximum healthcare benefits possible for him and his family based upon his claimed diagnosis and vision loss. During the same time period, Henderson received the highest priority in getting medical treatment from the VA, free medical and dental services, free prescriptions, reimbursement for travel from his home in Kentucky to the VA Medical Center in Huntington for medical appointments, free training for the blind in Connecticut and Alabama for extended periods of time, and free equipment designed to assist the blind, such as canes, computers, talking telephones, and night vision goggles.</p>
<p>The United States Department of Veterans Affairs – Office of Inspector General, Pittsburgh Resident Agency, and the Federal Bureau of Investigation conducted the investigation. Assistant United States Attorneys Eumi Choi and Jennifer Rada Herrald handled the prosecution and tried the case before a federal jury. Chief United States District Judge Robert C. Chambers imposed the sentence.</p>
<p><a href="https://www.justice.gov/usao-sdwv/pr/kentucky-veteran-sentenced-two-years-prison-after-federal-jury-found-him-guilty">Original PressReleases&#8230;</a></p>

Tax Fraud: Muhammad Saleem Iqbal Sentenced To Conspiring To Defraud Wholesale Tobacco Taxes and False Personal Income Tax Return
<h2>Sharon Man Sentenced for Tobacco Tax Fraud and Money Laundering</h2>
<p>BOSTON – A Sharon man was sentenced today in U.S. District Court in Boston in connection with illegally selling tobacco products and laundering the proceeds.</p>
<p>Muhammad Saleem Iqbal, 53, was sentenced by U.S. District Court Judge William G. Young to 42 months in prison, two years of supervised release and restitution of $28,027,946. The Court also ordered forfeiture of hundreds of thousands of dollars in tobacco products and over $150,000 belonging to Iqbal and the tax-evading wholesale tobacco business in which he engaged. In May, 2016, he pleaded guilty to conspiring to defraud Massachusetts of wholesale tobacco taxes and to filing a false personal income tax return.</p>
<p>Iqbal and a business partner operated a wholesale business under the name “Pick N Dip,” in Norwood that sold tobacco products, including cigars and smokeless tobacco (such as snuff and chewing tobacco), as well as other non-tobacco items, to convenience stores, gas stations and other retail businesses. Under state law, smokeless tobacco wholesalers must file an excise tax form monthly and pay a 210% excise tax on smokeless tobacco brought into Massachusetts. Cigar wholesalers must file an excise tax form quarterly and must pay a 40% excise tax on cigars brought into Massachusetts.</p>
<p>In order to evade tobacco taxes, beginning around 2010, Iqbal and his business partner repeatedly purchased tens of thousands of dollars at a time worth of smokeless tobacco and cigars in Pennsylvania where no taxes are imposed for these tobacco products. They then arranged to have these tobacco products covertly transported to Massachusetts for resale, without filing the records required by Massachusetts state law and federal law, and without paying excise taxes.</p>
<p>At the direction of Iqbal and his business partner, their employees repeatedly engaged in large cash transactions in order to conceal and disguise the nature, location, source, ownership and control of the proceeds of their illegal tobacco business and to avoid transaction reporting requirements under federal and state law. Their employees also transported more than $50,000 in cash at a time from Massachusetts to Pennsylvania where the money was used to purchase additional untaxed smokeless tobacco and cigars.</p>
<p>One of Iqbal’s co-defendants, Kaleem Ahmad, is scheduled to be sentenced tomorrow.</p>
<p>United States Attorney Carmen M. Ortiz; Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and David W. Hall, Special Agent in Charge of the U.S. Department of State, Boston Field Office, made the announcement today. Valuable assistance was also provided by the Massachusetts Department of Revenue. Assistant U.S. Attorneys Stephen P. Heymann of Ortiz’s Economic Crimes Unit and Doreen Rachel, Chief of Ortiz’s Asset Forfeiture Unit, handled the case.</p>
<p><a href="https://www.justice.gov/usao-ma/pr/sharon-man-sentenced-tobacco-tax-fraud-and-money-laundering">Original PressReleases&#8230;</a></p>

Financial Fraud: Junaidu Saljan Savage Sentenced For Conspiring to Commit Bank Fraud And For Aggravated Identity Theft
<h2>Lanham Man Sentenced to Over Seven Years in Federal Prison for Bank Fraud Conspiracy</h2>
<p><strong><em>Baltimore, </em></strong>Maryland – On October 14, 2016, U.S. District Judge George L. Russell III sentenced Junaidu Saljan Savage, a/k/a James Kamara, age 30, of Lanham, Maryland, to 87 months in prison, followed by five years of supervised release, for conspiring to<strong> commit bank fraud and for aggravated identity theft arising</strong> from a <em>scheme to defraud a bank</em> by using account holders’ personal information to take over their accounts. Judge Russell also ordered Savage to pay restitution of $36,400. A federal jury convicted Savage on March 15, 2016.</p>
<p>The sentence was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Postal Inspector in Charge Terrence P. McKeown of the U.S. Postal Inspection Service &#8211; Washington Division; Special Agent in Charge Brian Ebert of the United States Secret Service &#8211; Washington Field Office; and Chief J. Thomas Manger of the Montgomery County Police Department.</p>
<p>According to testimony at his six-day trial, from January 1, 2012 through April 2012, Savage conspired with Jayad Zainab Ester Conteh, Paul Anthony Williams and others to <strong>defraud a bank</strong>. Conteh, a bank teller, looked up bank account holder information on the computer system without authorization and disclosed the account holders’ personal identifying information to Savage and other co-conspirators. Using that information, Savage would call the bank pretending to be the account holder, change certain account information and order checks on the compromised account to be delivered by overnight mail. Savage and other co-conspirators would obtain those checks, including by intercepting the checks upon delivery at the actual account holders’ addresses. Wilson cashed the checks at bank branches in Maryland.</p>
<p>Trial evidence showed that as a result of the conspiracy at least seven bank account holders’ accounts were improperly accessed, with intended losses of more than $120,000.</p>
<p>Jayad Zainab Ester Conteh, age 24, of Glenarden, Maryland, was convicted after trial and sentenced to 64 months in prison for conspiring to commit bank fraud, bank fraud, aggravated identity theft and unauthorized access to a computer to obtain banking information. Judge Russell also entered an order that Conteh pay $36,400 in restitution to the victim bank and forfeit $36,400.</p>
<p>According to court documents and trial testimony, in July 2014, after Conteh had reported to prison to begin serving her sentence, Savage went to visit her relatives. An audio and video recording of the meeting revealed that Savage told Conteh’s relatives that he was involved in her criminal conduct and would pay the restitution ordered by the Court. In late August 2014, Savage’s girlfriend provided $6,000 in cash to a relative of Conteh as partial payment of Conteh’s restitution.</p>
<p>Co-conspirator Paul Anthony Wilson, a/k/a Anthony Johnson, age 53, of Washington, D.C., was arrested while attempting to cash a check on the account of one of the victims. Wilson pleaded guilty to his role in the conspiracy and was sentenced to 39 months in prison.</p>
<p>Today’s announcement is part of the efforts undertaken in connection with the President’s <a class="wpil_keyword_link" href="https://www.fraudswatch.com/tag/financial-fraud/" title="Financial" data-wpil-keyword-link="linked" data-wpil-monitor-id="622">Financial</a> Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit <a href="http://www.stopfraud.gov/"><u>www.StopFraud.gov</u></a>.</p>
<p>United States Attorney Rod J. Rosenstein praised the U.S. Postal Inspection Service, Secret Service and Montgomery County Police Department for their work in the investigation. Mr. Rosenstein thanked Assistant United States Attorneys Thomas P. Windom and Ray D. McKenzie, who prosecuted the case.</p>
<p><a href="https://www.justice.gov/usao-md/pr/lanham-man-sentenced-over-seven-years-federal-prison-bank-fraud-conspiracy">Original PressReleases&#8230;</a></p>

Mortgage Fraud: Moses S. Hall indicted On Fraud And Tax Offenses
<h2>Disbarred Attorney Indicted in Mortgage Modification Scheme</h2>
<p><span style="text-decoration: underline;"><strong>Victims Paid the Attorney Well Over $1 Million, Which He Allegedly Used for Personal Expenses and Never Reported as Income to IRS</strong></span></p>
<p><em>SANTA ANA, California</em> – A disbarred California attorney was arrested this morning on federal charges of running a <strong>mortgage modification scheme</strong> that <em>defrauded</em> more than 75 distressed homeowners in Orange County by inducing them to pay more than $1.4 million for services he never provided.</p>
<p>Moses S. Hall, 60, a resident of Blackwood, New Jersey, who formerly had a law practice in Fullerton, was arrested without incident this morning at his residence after being indicted this week on <strong>fraud and tax offenses</strong>.</p>
<p>According to the 16-count indictment returned Wednesday by a federal grand jury, Hall operated his <em><a class="wpil_keyword_link" href="https://www.fraudswatch.com/category/mortgage/" title="mortgage" data-wpil-keyword-link="linked" data-wpil-monitor-id="73">mortgage</a> modification scheme</em> from 2008 until 2012 through his law offices, as well as businesses called “Salva Casas” and “Loan Modifications of America.” The indictment alleges that Hall told distressed homeowners to stop making their mortgage payments, and instead direct their monthly mortgage payments to him, purportedly so he could use that money to negotiate with the banks. Instead, as detailed in the indictment, Hall used the victims’ money for himself.</p>
<p>The indictment alleges that Hall concealed from victims that he was using their money to pay for personal expenses and that he was a previously convicted felon who had served years in state prison in New Jersey prior to being admitted as an attorney in California.</p>
<p>Over the course of the fraudulent scheme, more than 75 victims were cheated out of more than $1 million, and some subsequently lost their homes. One married couple entrusted Hall with $400,000 to help them modify their mortgages. According to the indictment, Hall spent that $400,000 on personal expenses in only six months. That couple subsequently lost their home to foreclosure.</p>
<p>As further alleged in the indictment, Hall withdrew more than $1 million in cash from the bank accounts into which the victims’ payments had been deposited. Hall allegedly wrote checks to himself and his daughter, and used $25,000 cash to purchase a Mercedes Benz.</p>
<p>“This defendant allegedly used his position as a licensed attorney to persuade victims that he could help them with their <a class="wpil_keyword_link" href="https://www.fraudswatch.com/tag/financial-fraud/" title="financial" data-wpil-keyword-link="linked" data-wpil-monitor-id="621">financial</a> problems,” said United States Attorney Eileen M. Decker. “Instead of working for his clients, the defendant simply pocketed their money to fund an extravagant lifestyle. He has lost his license to practice law, and now he faces a significant prison term for the alleged crimes.”</p>
<p>Hall is also charged with interfering with the administration of the tax laws. Hall allegedly failed to file tax returns for the years 2008 through 2012, thereby failing to report more than $1 million in income. Hall was further charged with failing to report more than $400,000 in income for 2009 by failing to file a federal tax return for that year. Moreover, the indictment alleges that when Hall was interviewed in December 2015, he lied to IRS Special Agents about his use of that money.</p>
<p>“As set forth in today’s indictment, Mr. Hall allegedly preyed on struggling and trusting homeowners, literally stealing the American Dream out from under them,” said Acting Special Agent in Charge Anthony J. Orlando, IRS Criminal Investigation. “IRS CI, along with our federal law enforcement partners, remains committed to investigating and prosecuting those who commit mortgage fraud and line their pockets with profits from these schemes.”</p>
<p>“Schemes like this have heartbreaking consequences for the victims and we need to make it clear in no uncertain terms that this kind of criminal activity will not be tolerated,” said David Prince, acting special agent in charge for HSI Los Angeles. “HSI will continue to work closely with its federal, state, and local law enforcement partners to aggressively target those who, motivated by greed, engage in activities that harm consumers and undermine the integrity of our financial system.”</p>
<p>According to the California State Bar, Hall was <a href="http://members.calbar.ca.gov/fal/Member/Detail/153759"><u>disbarred</u></a> in 2012 for “misconduct in three loan modification matters.”</p>
<p><em>An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.</em></p>
<p>Hall is expected to make his initial court appearance this afternoon in United States District Court for the District of New Jersey.</p>
<p>If convicted of the 16 charges in the Indictment – one count of mail fraud, 13 counts of wire fraud, and the two tax charges – Hall would face a statutory maximum penalty of 284 years in federal prison.</p>
<p>This investigation was conducted by IRS Criminal Investigation, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, and the United States Secret Service. The State Bar of California, Office of Chief Trial Counsel, provided assistance during the investigation.</p>
<p>Assistant United States Attorney Charles E. Pell of the Santa Ana Branch Office is prosecuting the case.</p>
<p><a href="https://www.justice.gov/usao-cdca/pr/disbarred-attorney-indicted-mortgage-modification-scheme">Original PressReleases&#8230;</a></p>

Criminal Fraud: John Beliveau II Sentenced Of Exchange For Cash, Luxury Travel and The Services of Prostitutes
<h2>Former NCIS Supervisory Special Agent Sentenced to 12 Years in Prison for Taking Bribes from Foreign Defense Contractor in Massive Fraud and Corruption Scandal</h2>
<p><strong><em>Assistant U. S. Attorneys Mark W. Pletcher (619) 546-9714 or Patrick Hovakimian (619) 546-9718</em></strong></p>
<p>SAN DIEGO – Former Naval Criminal Investigative Service supervisory special agent John Beliveau II was sentenced in federal court today to 12 years in prison for disclosing sensitive law enforcement reports to a foreign defense contractor who was the target of a criminal fraud investigation in exchange for cash, luxury travel and the services of prostitutes.</p>
<p>Beliveau, 47, of York, Pennsylvania, was sentenced by U.S. District Judge Janis L. Sammartino, who also ordered Beliveau to pay $20 million in restitution to the Navy. Beliveau pleaded guilty on December 17, of 2013 to conspiracy to commit bribery and bribery. Beliveau was immediately taken into custody at his own request.</p>
<p>According to admissions made in his plea agreement, Beliveau helped former Glenn Defense Marine Asia (GDMA) CEO Leonard Glenn Francis perpetrate a massive fraud scheme on the U.S. Navy by providing information that allowed Francis to evade and thwart criminal investigations into misconduct by GDMA.</p>
<p>During the sentencing hearing, Judge Sammartino said Beliveau’s position of trust as a law enforcement agent, plus the immeasurable impact of his betrayal on NCIS and the Navy, warranted a strong sentence. “A great deal of harm occurred as a result of your conduct,” she told the defendant.</p>
<p>“John Beliveau’s reprehensible decision to provide sensitive information to the targets of ongoing fraud investigations in exchange for bribes tragically tarnished his badge and the reputation of NCIS,” said Andrew Traver, director of the Naval Criminal Investigative Service (NCIS). “It is impossible to quantify the extent or duration of the harm done by Beliveau, but holding him accountable will further signal that NCIS is committed to rebuilding the trust he damaged.”</p>
<p>“John Beliveau’s deceit was a devastating blow to the U.S. Navy and ultimately the nation that he was sworn to protect,” said U.S. Attorney Laura Duffy. “While this disgraced agent serves what may be the longest prison sentence ever handed down to a federal agent in a corruption case, his colleagues are left to rebuild the trust and credibility that he singlehandedly destroyed.”</p>
<p>“Beliveau tarnished his NCIS badge and sold sensitive law enforcement information for envelopes of cash, luxury travel and tawdry entertainment,” said Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division. “His actions risked an important criminal investigation and the safety of witnesses who agreed to cooperate with law enforcement under the belief that their identities would be protected. Today’s sentence reflects the gravity of those crimes [if multiple counts] and makes clear that we will not tolerate law enforcement corruption.”</p>
<p>“Today’s sentencing sends a resounding message that justice will be served regardless of rank or position.&#8221; Said Dermot O’Reilly, director of the Department of Defense’s Defense Criminal Investigative Service. “The conduct of former NCIS Supervisory Special Agent Beliveau is reprehensible. The foundation of our criminal justice system relies on the public&#8217;s trust in the law enforcement community. Whenever a law enforcement member breaches that trust, it leaves an indelible stain on those who serve to enforce our nation’s laws. The Defense Criminal Investigative Service and its law enforcement partners will relentlessly pursue any individual who places at risk the safety and security of our armed forces personnel.”</p>
<p>“We are proud to be part of the team that has been investigating the criminal allegations in the Glenn Defense Marine Asia case. It is especially troubling that someone in his role is on the wrong side of the investigation,” said Anita Bales, Director, Defense Contract Audit Agency.</p>
<p>According to his plea agreement, Beliveau acknowledged that he regularly searched confidential NCIS databases for reports of investigations related to Francis and GDMA. Over the course of years, he helped Francis avoid multiple criminal investigations by providing copies of these reports. These reports not only tipped off Francis that he was the target of a criminal investigation, but provided sensitive law enforcement information about the ongoing investigation, including the identities of the subjects of the investigations; information about witnesses, including identifying information about cooperating witnesses and their testimony; the particular aspects of GDMA’s billings that were of concern to the investigations; the fact that the investigations had obtained numerous email accounts and the identities of those accounts; the reports to prosecutors and their interactions with the investigations; and planned future investigative activities.</p>
<p>Beliveau regularly demanded money and prostitutes from Francis. “I will always be your friend, but you will get nothing else…until I get what you promise,” he said in an email to Francis in April 2012. “You give whores more money than you give me…I can be your best friend or your worst enemy. I am not an amateur.”</p>
<p>Beliveau admitted that he attempted to cover up his involvement by asking Francis to delete incriminating emails and deactivate an email account, and warned Francis about indictments and a warrant on his email account.</p>
<p>Beliveau also admitted that he counseled Francis on how to perpetuate his fraud scheme and evade detection. In July 2011, Beliveau advised Francis to respond to the pending NCIS investigation into GDMA’s submission of a fraudulent claim to the U.S. Navy for dockage and wharfage fees for certain U.S. Navy ship visits to Thailand.</p>
<p>In return for providing him with information, Francis provided Beliveau with envelopes containing cash, luxury travel from Virginia to Singapore, the Philippines and Thailand. On many occasions, beginning in 2008 and continuing through 2012, while Beliveau was posted in Singapore, Francis provided him with prostitutes, lavish dinners, entertainment and alcohol at high-end nightclubs. The tab for each of these outings routinely ran into the thousands of dollars.</p>
<p>So far, a total of 16 individuals have been charged in connection with the GDMA corruption and fraud investigation. Including Beliveau, 11 of those are current or former U.S. Navy officials, including Admiral Robert Gilbeau, Captain (ret.) Michael Brooks, Lt. Commander Gentry Debord, Commander Bobby Pitts, Captain Daniel Dusek, Commander Michael Misiewicz, Lt. Commander Todd Malaki, Commander Jose Luis Sanchez, Petty Officer First Class Daniel Layug, Naval Criminal Investigative Service Supervisory Special Agent John Beliveau and Paul Simpkins, a former DoD civilian employee who oversaw contracting in Singapore.</p>
<p>Gilbeau, Debord, Dusek, Misiewicz, Malaki, Beliveau, Sanchez, Layug and Simpkins have pleaded guilty. On Jan. 21, 2016, Layug was sentenced to 27 months in prison and a $15,000 fine; on Jan. 29, 2016, Malaki was sentenced to 40 months in prison and to pay $15,000 in restitution to the Navy and a $15,000 fine; on March 25, 2016, Dusek was sentenced to 46 months in prison and to pay $30,000 in restitution to the Navy and a $70,000 fine; and on April 29, 2016, Misiewicz was sentenced to 78 months in prison and to pay a fine of $100,000 and to pay $95,000 in restitution to the Navy. Gilbeau, Sanchez and Simpkins also await sentencing. Brooks and Pitts were charged in May 2016 and their cases are pending.</p>
<p>Also charged are five GDMA executives: Francis, Alex Wisidagama, Ed Aruffo, Neil Peterson and Linda Raja. Wisidagama has pleaded guilty and was sentenced on March 18, 2016, to 63 months in prison and $34.8 million in restitution to the Navy. Francis and Aruffo have pleaded guilty and await sentencing; Peterson’s and Raja’s cases are pending.</p>
<p>DCIS, NCIS and the Defense Contract Audit Agency are investigating. Assistant Chief Brian R. Young of the Criminal Division’s Fraud Section and Assistant U.S. Attorneys Mark W. Pletcher and Patrick Hovakimian of the Southern District of California are prosecuting the case.</p>
<p>Anyone with information relating to fraud or corruption should contact the NCIS anonymous tip line at www.ncis.navy.mil or the DOD hotline at www.dodig.mil/hotline, or call (800) 424-9098.</p>
<p><strong><u>DEFENDANT</u> </strong></p>
<p><strong><u>Case Number: 13cr3781</u></strong></p>
<p>John Bertrand Beliveau II <strong>44 Woodbridge, Virginia</strong></p>
<p><strong><u>SUMMARY OF CHARGES</u></strong></p>
<p>Conspiracy to Commit Bribery in violation of 18 U.S.C. § 371</p>
<p>Maximum of 5 years in prison; a maximum $250,000 fine, or twice the gross gain or loss from the offense, whichever is greater</p>
<p>Bribery in violation of 18 U.S.C. § 201</p>
<p>Maximum of 15 years in prison; a maximum fine of $250,000, twice the gross gain or loss from the offense, or three times the monetary equivalent of the thing of value, whichever is greater.</p>
<p><strong><u>INVESTIGATING AGENCIES</u></strong></p>
<p>Defense Criminal Investigative Service</p>
<p>Naval Criminal Investigative Service</p>
<p>Homeland Security Investigations</p>
<p>Defense Contract Audit Agency</p>
<p> ;</p>
<p><a href="https://www.justice.gov/usao-sdca/pr/former-ncis-supervisory-special-agent-sentenced-12-years-prison-taking-bribes-foreign">Original PressReleases&#8230;</a></p>

Tax Fraud: Roger Linares Sentenced For Multiple Fraudulent Individual Income Tax Returns
<h2>Tax Preparation Business Owner Sentenced To Prison For Defrauding The IRS</h2>
<p><strong>LAS VEGAS, Nev</strong>. – A man who operated tax preparation businesses in Nevada and Utah from 2004 to 2010, has been sentenced to 18 months in prison, three years of supervised release, and ordered to pay approximately $182,000 in restitution, for aiding and assisting in the preparation of multiple fraudulent individual income tax returns, announced U.S. Attorney Daniel G. Bogden for the District of Nevada.</p>
<p>“Unfortunately, there are persons with expertise in accounting and tax preparation who take advantage of less skilled or less educated persons who are trying to follow the law,” said U.S. Attorney Bogden. “We are continually working with the IRS to identify, investigate and prosecute these persons and to ensure that their businesses are shut down or cleaned up.”</p>
<p>Roger Linares, 43, was sentenced by U.S. District Judge James C. Mahan. Linares pleaded guilty in July to one count of conspiracy to defraud the United States. Linares must report to federal prison by Jan. 13, 2017.</p>
<p>Another defendant charged in the scheme, Sergio Acosta, also pleaded guilty to one count of conspiracy to defraud the United States and was sentenced on Sept. 13 to five years of probation, six months of home confinement, and ordered to pay approximately $182,000 in restitution.</p>
<p>According to the guilty plea agreement, in October 2004, Linares and his wife opened a tax preparation business named America Services. By 2010, the business had 11 locations, including seven in Las Vegas, one in Mesquite, two in Salt Lake City, and one in St. George. They registered the business in Linares’ wife’s name because Linares did not become a U.S. citizen until approximately 2009. Linares actively participated in running the day-to-day operations of the business from 2004 to early 2010. The business established a large clientele consisting mostly of Hispanic individuals who spoke little or no English and possessed little tax knowledge. Those clients entrusted Linares and other employees at the business to accurately prepare their federal income tax returns. Linares aided and assisted in the preparation of at least 18 false individual income tax returns, but without the clients’ knowledge that the returns included false information that generated large refunds for the clients. Linares benefited from the large volume of customers because he was part-owner of the business and received a substantial portion of the proceeds. Other employees were paid commissions and the more returns they prepared, the more money they earned. The business was identified as having a 98 percent refund rate and substantial unreimbursed employee business expenses and questionable dependents. The total tax loss to the government for the 2008 and 2009 tax returns prepared by the defendants was $181,818.</p>
<p>The case was investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorney Lisa Cartier-Giroux.</p>
<p><a href="https://www.justice.gov/usao-nv/pr/tax-preparation-business-owner-sentenced-prison-defrauding-irs">Original PressReleases&#8230;</a></p>

Financial Fraud: Robert Smith Guilty to Charges of Mail Fraud For a Decade-Long Scheme to Defraud the International Longshoremen’s Association (ILA),
<h2>Union Official Pleads Guilty to Stealing Over $1 Million from ILA Local 970</h2>
<p>NORFOLK, Va. – Robert Smith, III, 48, of Virginia Beach, pleaded guilty today to charges of mail fraud for a decade-long scheme to defraud the International Longshoremen’s Association (ILA), Local 970 of over $1 million.</p>
<p>Over 600 people are victims of Mr. Smith’s selfish crime,” said Dana J. Boente, U.S. Attorney for the Eastern District of Virginia. “Mr. Smith was entrusted with ensuring the <a class="wpil_keyword_link" href="https://www.fraudswatch.com/tag/financial-fraud/" title="financial" data-wpil-keyword-link="linked" data-wpil-monitor-id="620">financial</a> health and stability of Local 970, and instead chose to steal over $1 million for his personal benefit. This office remains committed to aggressively pursuing those who abuse their positions of trust and steal from innocent victims.”</p>
<p>“Members of Local 970 trusted Robert Smith III, to uphold his fiduciary responsibility to their union,” said Robin Blake, Special Agent-in-Charge, U.S. Department of Labor, Office of Inspector General. “Smith betrayed members by committing mail fraud to embezzle more than $1 million from the union, hid his crime for 10 years by failing to meet the annual reporting requirements to the Department of Labor, and eventually lied to officials from the Department. We will continue to work with our law enforcement partners to safeguard the assets of union members and all American workers.”</p>
<p>According to the statement of facts filed with the plea agreement, Smith served as the Business Agent and the Financial Secretary for ILA, Local 970. Local 970 is a union whose members provide qualified labor to the Port of Virginia. From March 2006 through April 2016, Smith devised a scheme to embezzle funds from the Local 970 bank accounts. Specifically, Smith deposited new member initiation fees and member dues received from local employers into an ILA Bank account, and then used those funds for his own personal purposes. Over a period of ten years, Smith stole approximately $1,072,668.30 of union funds. Smith withdrew over $700,000 in cash, paid his personal credit card bills, and used the funds to purchase gas, food, clothing, shoes, toys, entertainment, and home improvement supplies.</p>
<p>Smith faces a maximum penalty of 20 years in prison sentenced on Feb. 7, 2017. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.</p>
<p>Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Jonathan F. Trimble, Acting Special Agent in Charge of the FBI’s Norfolk Field Office; and Robin Blake, Special Agent-in-Charge of the Washington, DC Regional Office, U.S. Department of Labor, Office of Inspector General, made the announcement after the plea was accepted by U.S. Magistrate Judge Robert Krask. Assistant U.S. Attorney Melissa E. O’Boyle is prosecuting the case.</p>
<p>A copy of this press release may be found on the website of the <a href="https://www.justice.gov/usao/vae"><u>U.S. Attorney’s Office</u></a><span style="color: #000000;"> for the Eastern District of Virginia. Related court documents and information may be found on the website of the </span><a href="http://www.vaed.uscourts.gov/"><u>District Court</u></a><span style="color: #000000;"> for the Eastern District of Virginia or on </span><a href="https://pcl.uscourts.gov/"><u>PACER</u></a><span style="color: #000000;"> by searching for <b>Case No. 2:16cr134.</b></span></p>
<p><a href="https://www.justice.gov/usao-edva/pr/union-official-pleads-guilty-stealing-over-1-million-ila-local-970">Original PressReleases&#8230;</a></p>

Financial Fraud: EDWARD J. SERVIDER Charged With Commodities Fraud, Mail Fraud, and Wire Fraud in Connection With a Scheme to Defraud
<h2 class="node-title">Staten Island Man Charged With Defrauding Over 100 Investors Of More Than $2 Million</h2>
<div class="field field--name-field-pr-body field--type-text-long field--label-hidden">
<div class="field__items">
<div class="field__item even">
<p>Preet Bharara, the United States Attorney for the Southern District of New York, and William F. Sweeney, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced the arrest and unsealing of a complaint charging EDWARD J. SERVIDER, a/k/a “Nick Halden,” with commodities fraud, mail fraud, and wire fraud in connection with a scheme to defraud over 100 investors out of more than $2.4 million. From March 2013 through July 2014, SERVIDER, through his firm EJS Capital Management, LLC, fraudulently solicited investments for trading in off-exchange foreign currency (“Forex”) transactions. In fact, none of the money was used for such transactions, and SERVIDER converted the funds to his own use, and the use of others, without the authorization of his investors. Rather than invest his victims’ funds as promised, SERVIDER misappropriated a major portion of investors’ funds and used them to pay personal and business expenses. SERVIDER will be presented today before Magistrate Judge Barbara Moses.</p>
<p>In a separate action in May 2014, the Commodity Futures Trading Commission (“CFTC”) filed civil charges against SERVIDER, EJS Capital Management, LLC and others.</p>
<p>U.S. Attorney Preet Bharara said: “As alleged, Edward Servider not only lied to his investors about his past performance in the Forex markets, but actually did not even engage in any trades for his investors. Instead, Servider allegedly used investor money to fund his own extravagant lifestyle, including to pay for an engagement ring, a BMW lease, hotel rooms and parking tickets.”</p>
<p>FBI Assistant Director in Charge William F. Sweeney said: “When people decide to invest their money, those investors understand it may take time before they see a return on their investments. The subject in this case allegedly believed his clients weren’t ever going to ask where their money went, and chose to spend it. Traders hoping to live the high life should view this case as a cautionary tale. There is no pot of gold at the end of the rainbow, only investors and the FBI and our law enforcement partners demanding you explain where the money went.”</p>
<p><strong>According to the allegations in the Complaint unsealed in Manhattan federal court</strong> (As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.) :</p>
<p>In March 2013, SERVIDER set up a retail foreign currency exchange trading firm, called EJS Capital Management, LLC (“EJS”) in Brooklyn. SERVIDER and his business partner (“CC-1”) ran EJS from March 2013 through July 2014. EJS employed salespeople who made unsolicited telephone calls to prospective investors. SERVIDER and the EJS salespeople told prospective investors that their funds would be used to trade in Forex transactions, and provided them with a “performance report” that falsely claimed that between 2010 and 2013, EJS had achieved gross annual returns for its investors of approximately 18 percent, 22 percent, 49 percent, and 77 percent (the “EJS Performance Report”). The EJS Performance Report contained false and fraudulent representations, as EJS had never conducted any trading nor achieved any returns for its investors. According to the terms of the contracts into which EJS entered with its investors, EJS was authorized only to engage in Forex transactions on behalf of its investors; EJS was not authorized to withdraw any investor money funds; and the only fee that EJS investors agreed to pay to EJS was a commission based on the success of their investments. SERVIDER directed EJS employees to send account statements to the EJS investors, falsely showing positive returns on their investments.</p>
<p>In fact, instead of being used to execute Forex trading, the majority of the investor funds was misappropriated and used to pay SERVIDER and CC-1’s personal expenses and purported business expenses for EJS. For example, SERVIDER used investor funds to purchase an engagement ring, to lease a BMW vehicle for his girlfriend, and to pay for hotel rooms, rental cars, and parking tickets.</p>
<p class="rtecenter">* * *</p>
<p>SERVIDER, 28, of Staten Island, New York, is charged with six counts, which are listed below with their respective maximum prison sentences and fines.</p>
<table border="1" cellspacing="0" cellpadding="0">
<tbody>
<tr>
<td><strong>Count</strong></td>
<td><strong>Offense</strong></td>
<td><strong>Maximum prison sentence</strong></td>
<td><strong>Maximum fine</strong></td>
</tr>
<tr>
<td>One</td>
<td>Conspiracy to Commit Commodities Fraud</td>
<td>5 years</td>
<td>The greatest of $250,000, twice the gross gain or twice the gross loss</td>
</tr>
<tr>
<td>Two</td>
<td>Commodities Fraud by Misappropriation and Omission</td>
<td>10 years</td>
<td>$1 million</td>
</tr>
<tr>
<td>Three</td>
<td>Fraud by a Commodity Trading Advisor</td>
<td>10 years</td>
<td>$1 million</td>
</tr>
<tr>
<td>Four</td>
<td>Conspiracy to Commit Mail Fraud and Wire Fraud</td>
<td>20 years</td>
<td>The greatest of $250,000, twice the gross gain or twice the gross loss</td>
</tr>
<tr>
<td>Five</td>
<td>Wire Fraud</td>
<td>20 years</td>
<td>The greatest of $250,000, twice the gross gain or twice the gross loss</td>
</tr>
<tr>
<td>Six</td>
<td>Mail Fraud</td>
<td>20 years</td>
<td>The greatest of $250,000, twice the gross gain or twice the gross loss</td>
</tr>
</tbody>
</table>
<p>The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.</p>
<p>Mr. Bharara praised the work of the FBI, and thanked the CFTC for its assistance.</p>
<p>The charges were brought in connection with the President’s <a class="wpil_keyword_link" href="https://www.fraudswatch.com/tag/financial-fraud/" title="Financial" data-wpil-keyword-link="linked" data-wpil-monitor-id="619">Financial</a> Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit <a href="http://www.stopfraud.gov/">www.StopFraud.gov</a>.</p>
<p>This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Christine I. Magdo is in charge of the prosecution.</p>
<p>The allegations contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.</p>
<p><a href="https://www.justice.gov/usao-sdny/pr/staten-island-man-charged-defrauding-over-100-investors-more-2-million">Original PressReleasess&#8230;</a></p>
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Financial Fraud: Plaza Construction LLC Fraud Charges With Mail and Wire Fraud Conspiracy
<h2>Plaza Construction Charged With Fraud</h2>
<h3>Will Pay More Than $9 Million In Restitution And Penalties For Defrauding Clients In A Thirteen-Year Overbilling Scheme</h3>
<p><u><strong><em>Projects Included the Empire State Building, Brooklyn Navy Yard, Bronx Terminal Market, Federal Reserve Bank of New York, and New York University</em></strong></u></p>
<p>Earlier today, the U.S. Attorney’s Office for the Eastern District of New York (the Office) filed fraud charges in Brooklyn federal court against Plaza Construction LLC, successor to Plaza Construction Corp. (Plaza Construction), one of the largest construction firms in New York City. Plaza Construction is charged with mail and wire fraud conspiracy for improperly billing its clients more than $2.2 million over a thirteen-year period for hours not worked and for inserting a hidden surcharge into its bills for the purpose of obtaining payments to offset administrative costs. As a result, Plaza Construction has entered into a deferred prosecution agreement with the Office in which it admitted to fraudulently overbilling clients and agreed to pay more than $9 million in restitution to victims, and forfeiture and penalties to the federal government. The company has additionally instituted far-reaching corporate reforms designed to eliminate future problems and enforce best industry practices.</p>
<p>Today’s deferred prosecution agreement marks the fourth resolution by the Office aimed at rooting out fraud in the construction industry. In April 2012, Lend Lease (US) Construction LMB Inc. (formerly Bovis Lend Lease LMB Inc.) was charged with defrauding its clients, entered into a deferred prosecution agreement, and paid $56 million in restitution and penalties for engaging in a ten-year overbilling scheme. In May 2015, Hunter Roberts Construction Group, LLC entered into a non-prosecution agreement and agreed to pay more than $7 million in restitution and penalties for engaging in an eight-year fraudulent overbilling scheme. In December 2015, Tishman Construction Corporation was charged with defrauding its clients, entered into a deferred prosecution agreement, and paid more than $20 million in restitution and penalties for engaging in a ten-year overbilling scheme.</p>
<p>The charges and disposition were announced by Robert L. Capers, United States Attorney for the Eastern District of New York; Michael Nestor, Inspector General, Port Authority of New York and New Jersey (PANYNJ); William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Carol Fortine Ochoa, Inspector General, General Services Administration (GSA), Office of Inspector General; Scott S. Dahl, Inspector General, U.S. Department of Labor (DOL), Office of Inspector General; and Mark G. Peters, Commissioner, New York City Department of Investigation (DOI).</p>
<p>“For more than a decade, Plaza Construction overbilled its clients by charging them for unworked time and by fraudulently inserting a hidden surcharge to help offset its administrative costs. By doing so, the company defrauded its clients and abused the trust placed in it to provide construction services at some of New York’s most storied sites. Today’s criminal charges and resolution, the fourth resolution in this area, demonstrate our steadfast efforts in combating and eliminating fraud in New York City’s construction industry,” stated U.S. Attorney Capers. Mr. Capers thanked the investigative agencies for their outstanding commitment and dedication over the course of this multi-year industry investigation.</p>
<figure id="attachment_29262" aria-describedby="caption-attachment-29262" style="width: 300px" class="wp-caption alignright"><a href="https://www.fraudswatch.com/financial-fraud-plaza-construction-llc-fraud-charges-with-mail-and-wire-fraud-conspiracy/plaza-construction-llc-2/" rel="attachment wp-att-29262"><img class="size-full wp-image-29262" src="https://www.fraudswatch.com/wp-content/uploads/2016/10/Plaza-Construction-LLC-2.jpg" alt="Financial Fraud" width="300" height="128" /></a><figcaption id="caption-attachment-29262" class="wp-caption-text">Plaza Construction LLC</figcaption></figure>
<p>“Plaza’s conduct that perpetuated an industry-wide fraud for more than a decade has come to an end. Government contracting agencies, and private clients alike, deserve to be billed strictly for what they bargained for, not duped into overpaying for gratuitous or phantom services. Responsible for overseeing one of the largest government contracting agencies in the region, the Port Authority Office of Inspector General will continue to uproot fraud and corruption within the area’s construction industry,” stated PANYNJ Inspector General Nestor. Mr. Nestor thanked his law enforcement partners for their dedication and professionalism in investigating these practices.</p>
<p>“Fraudulent business practices put consumers, employees, and other industry competitors at a significant disadvantage. Trust, once broken, is difficult to restore. Companies, no matter how large or small, are reminded to exercise due diligence in alerting authorities about crimes of this nature. We, along with our partners, take crimes of fraud seriously, and we will continue to seek justice to the full extent of the law,” stated FBI Assistant Director-in-Charge Sweeney.</p>
<p>“Plaza Construction used deceitful practices to bilk the American taxpayers. The GSA OIG is committed to working with our law enforcement partners to hold accountable contractors who defraud the United States,” said GSA Inspector General Ochoa.</p>
<p>“Plaza Construction defrauded their clients by charging them for work that was not performed and by charging them prohibited fees. Today’s resolution holds Plaza accountable for their actions and deters those who would contemplate similar misconduct in the future. We will continue to work with our law enforcement partners to vigorously pursue fraud in the construction industry that has a negative impact on the American workforce,” stated DOL Inspector General Dahl.</p>
<p>DOI Commissioner Peters said, “These fraudulent overbilling schemes involved some of the highest profile construction projects in New York City, driving up costs, exploiting overtime, and siphoning millions of dollars in unearned, ill-gotten gains. DOI will continue to work with its law enforcement partners to expose and stop this type of corruption, and ensure construction sites and companies are following the rules and operating lawfully.”</p>
<p align="center"><strong><u>The Overbilling Scheme</u></strong></p>
<p>As alleged in the felony information, Plaza Construction engaged in a fraudulent overbilling scheme that impacted a number of its projects for at least a thirteen-year period. These projects included the Brooklyn Navy Yard, Bronx Terminal Market, Federal Reserve Bank of New York, New York University, and Empire State Building.</p>
<p>Plaza Construction’s role on construction projects was typically that of a construction manager, which often required it to supply workers from certain trade unions and to supervise the work done by subcontractors or trade contractors. From at least 1999 through approximately February 2012, Plaza Construction submitted bills to clients, including government contracting and funding agencies, that contained numerous false statements and material misrepresentations and omissions. From August 2004 through February 2012, Plaza Construction systemically inserted a hidden surcharge in its bills to clients that was specifically prohibited and secretly generated additional revenue to offset certain administrative costs.</p>
<p>Additionally, from at least 1999 until 2009, Plaza Construction also billed its clients for hours not worked by labor foremen from Local 79 Mason Tenders’ District Council of Greater New York and carried out this fraudulent overbilling by: (a) allowing labor foremen to be absent from work for major holidays and certain vacation days; (b) providing between five and seven hours of guaranteed overtime per day, whether worked or not, for a particular senior labor foreman; and (c) adding one to two hours of unworked or unnecessary “guaranteed” overtime per day to the time sheets for certain labor foremen. In furtherance of this overbilling scheme, Plaza Construction completed and submitted time sheets to its clients as though the labor foremen had actually worked.</p>
<p align="center"><strong><u>The Deferred Prosecution Agreement</u></strong></p>
<p>Pursuant to the deferred prosecution agreement filed today, Plaza Construction accepted responsibility for its fraudulent billing practices and agreed to offer restitution to its clients in the amount of $2,226,270.19 and pay a penalty of $5,619,269.92 and forfeit $1,350,317.43 to the government over a two-year period. In consideration of Plaza Construction’s remedial actions to date and its commitment to, among other actions: (a) accept and acknowledge responsibility for its conduct; (b) continue its cooperation; (c) make restitution available to victims; and (d) make the payment of forfeiture and a <a class="wpil_keyword_link" href="https://www.fraudswatch.com/tag/financial-fraud/" title="financial" data-wpil-keyword-link="linked" data-wpil-monitor-id="618">financial</a> penalty to the government; the government agreed to defer the prosecution for a period of 24 months and to obtain an exclusion of time to allow Plaza Construction to demonstrate good conduct and compliance with the terms of this agreement. Plaza Construction’s remedial measures include the creation of the positions of General Counsel, Associate General Counsel and Compliance Director at the company; establishing a Compliance Committee; instituting annual training for all officers and non-union employees regarding its Code of Business Ethics; establishing an ethics hotline for employees to report ethics violations or concerns; and the revision of time sheet recording and client billing policies.</p>
<p>The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Whitman Knapp and Jonathan P. Lax are in charge of the prosecution, with assistance from Assistant United States Attorney Brian Morris of the Office’s Civil Division, which is responsible for the forfeiture of assets.</p>
<p><a href="https://www.justice.gov/usao-edny/pr/plaza-construction-charged-fraud">Original PressReleases&#8230;</a></p>

Financial Fraud: Tara L. Mitchell and Mechelle Blankenship Guilty to Conspiring to Defraud With False Tax Returns
<h2>Logan County, Kentucky, Tax Return Preparers Guilty Of Preparing False Tax Returns</h2>
<p><em>Falsified taxpayer education expenses resulting in education credits on prepared tax returns for a loss of more than $250,000</em></p>
<p>BOWLING GREEN, Ky. – Two former tax preparers pleaded guilty in United States District Court this week, before United States District Judge Greg N. Stivers, to conspiring to defraud the United States through preparing false tax returns and aiding in the preparation of the false returns at a tax preparation office in Logan County, Kentucky, announced United States Attorney John E. Kuhn, Jr.</p>
<p>Defendants Tara L. Mitchell and Mechelle Blankenship were initially charged in a 21-count grand jury indictment, that was unsealed March 21, 2016. According to the plea agreement, the defendants worked together at Triple J Tax, a tax return preparation office located in Russellville, Kentucky. Mitchell managed the office and in 2012, hired and trained defendant Blankenship to prepare tax returns.</p>
<p>The defendants admitted yesterday, in separate plea agreements, that between March 2012, and November 2014, they knowingly agreed to defraud the United States by preparing and electronically filing U.S. Individual Income Tax Returns, on behalf of themselves and clients of Triple J Tax, which contained statements that they knew were false and fraudulent as to material matters, thereby causing the Internal Revenue Service to pay tax refunds that were not due under provisions of the Internal Revenue laws. The loss was more than $250,000.</p>
<p>Specifically, the returns stated the taxpayers had incurred educational expenses, when they had not, and thus falsely claimed education-related credits, to which the taxpayers were not entitled.</p>
<p>Further, in the course of the conspiracy, Mitchell and Blankenship also included fraudulent education credits on their own tax returns. On or about January 10, 2013, Mitchell and Blankenship prepared Mitchell’s 2012 tax return, fraudulently claiming education expenses in the amount of $3,500, resulting in a $950 American opportunity credit. On or about April 11, 2013, Mitchell and Blankenship prepared Blankenship’s 2012 tax return, fraudulently claiming education expenses in the amount of $4,000, resulting in a $371 American opportunity credit and a $557 education credit.</p>
<p>If convicted at trial, Blankenship could be sentenced to up to 41 years in prison, fined $1,450,000 and required to serve a 3 year period of supervised release. Mitchell could be sentenced up to 29 years in prison, fined $1,050,000 and required to serve a 3 year period of supervised release.</p>
<p>Assistant United States Attorney Amanda E. Gregory is prosecuting the case. The Internal Revenue Service (IRS) Criminal Investigation office is conducting the investigation.</p>
<p><a href="https://www.justice.gov/usao-wdky/pr/logan-county-kentucky-tax-return-preparers-guilty-preparing-false-tax-returns">Original PressReleases&#8230;</a></p>

Mortgage Fraud: Alagi Samba Guilty To Conspiracy To Commit Wire Fraud Affecting a Financial Institution
<h2>Second Defendant Pleads Guilty In Mortgage Fraud Conspiracy</h2>
<p>BUFFALO, N.Y.-U.S. Attorney William J. Hochul Jr. announced today that Alagi Samba, 46, of Bronx, NY, pleaded guilty to conspiracy to commit wire fraud affecting a financial institution, before U.S. District Judge Laurence J. Vilardo. The charge carries a maximum penalty of 30 years in prison and a $1,000,000 fine.</p>
<p>Assistant U.S. Attorneys Kathleen A. Lynch and Elizabeth Moellering, who are handling the case, stated that between June 2008 and February 2009, the defendant conspired with other individuals to devise a scheme to commit <a class="wpil_keyword_link" href="https://www.fraudswatch.com/category/mortgage/" title="mortgage" data-wpil-keyword-link="linked" data-wpil-monitor-id="72">mortgage</a> fraud which included obtaining seven loans for unqualified borrowers.</p>
<p>As part of the scheme, Samba served as a realtor on behalf of co-conspirator Daniel Badu in the purchase of a property at 814 Faile Street, Bronx, NY. The defendant was aware that Badu was employed as a home health aide and did not have the income or assets to qualify for a mortgage <a class="wpil_keyword_link" href="https://www.fraudswatch.com/category/loans/" title="loan" data-wpil-keyword-link="linked" data-wpil-monitor-id="228">loan</a> in the amount of $574,543 to purchase the property. Samba obtained Badu’s personal identification information and business documents and provided them to another co-conspirator, a mortgage broker, knowing that the documents would be altered or created to falsely indicate that Badu was an ophthalmologist at his company Eagle Eyes. In addition, fraudulent paystubs and tax returns were submitted to support the loan application. Samba knew that these false loan documents were submitted a mortgage bank in order to secure a loan insured by the Federal Housing Administration. Based on that false application and supporting documentation, the loan was approved.</p>
<p>The defendant and his co-conspirators arranged for additional fraudulent loans to be approved, including another loan for Badu, and caused wire communications to be transmitted in interstate commerce for those loans. These fraudulent transactions caused losses of approximately $3,603,830 affecting <a class="wpil_keyword_link" href="https://www.fraudswatch.com/tag/financial-fraud/" title="financial" data-wpil-keyword-link="linked" data-wpil-monitor-id="617">financial</a> institutions in Buffalo and elsewhere.</p>
<p>Daniel Badu was also convicted of wire fraud affecting a financial institution and is scheduled to be sentenced on November 15, 2016 at 10:00 am before Judge Vilardo.</p>
<p>Charges are pending against defendants Gregory Gibbons, Julio Rodriguez, Laurence Savedoff, and Tina Brown. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.</p>
<p>The plea is the culmination of an investigation by the United States Postal Inspection Service under the direction of Shelly Binkowski, Inspector in Charge, Boston Division, the United States Department of Housing and Urban Development, Office of the Inspector General, under the direction of Special Agent in Charge Brad Geary; and the Federal Bureau of Investigation, under the direction of Special Agent in Charge Adam S. Cohen. Additionally, the New York State Department of Financial Services assisted with the investigation.</p>
<p>Sentencing for defendant Samba is scheduled for March 14, 2017 at 10:00 a.m. also before Judge Vilardo</p>
<p><a href="https://www.justice.gov/usao-wdny/pr/second-defendant-pleads-guilty-mortgage-fraud-conspiracy">Original PressReleases&#8230;</a></p>

Financial Fraud: David T. Shulick Indicted For Embezzling Funds, Scheme to Defraud PNC Bank and Filing False Tax Returns
<h2>Buisnessman Indicted On Embezzlement And Tax Charges</h2>
<p>PHILADELPHIA &#8211; An indictment was returned today charging David T. Shulick, 46, of Gladwyne, Pennsylvania, with embezzling funds from the School District of Philadelphia. Shulick was also charged in a scheme to defraud PNC Bank, and with filing false tax returns with the Internal Revenue Service.</p>
<p>The indictment charges that between 2010 and 2012, defendant Shulick, and co-conspirator Chaka Fattah, Jr., embezzled funds from the School District of Philadelphia, in part by misrepresenting the educational services that would be provided to students pursuant to a contract between the School District and Shulick’s company, Unique Educational Experiences, Inc. (“UEE”). According to the indictment, Shulick and Fattah Jr. hid the true costs of services provided by UEE by submitting false budgets to the School District of Philadelphia. The indictment alleges that the budgets contained false entries for benefit costs, inflated staff salaries, and salaries for staff positions that were never filled at the school operated by UEE. The indictment alleges that as a result of this scheme, defendant Shulick fraudulently obtained funds from the School District of Philadelphia that were supposed to be used to educate students. According to the indictment, defendant Shulick used those funds to enrich himself, including by paying for contractors who performed work at Shulick’s personal residence and vacation homes.</p>
<p>The indictment also alleges that Shulick and Fattah Jr. devised a scheme to defraud PNC Bank. According to the indictment, Fattah Jr. had defaulted on a <a class="wpil_keyword_link" href="https://www.fraudswatch.com/category/loans/" title="loan" data-wpil-keyword-link="linked" data-wpil-monitor-id="227">loan</a> made by PNC. As part of the scheme, Shulick acted as Fattah Jr.’s lawyer and threatened PNC Bank with the possibility that Fattah Jr. might file bankruptcy if he were unable to resolve his outstanding debts, which would result in the bank receiving little or no repayment on the loan. According to the indictment, defendant Shulick sent a letter to PNC Bank, offering to settle PNC Bank’s claim for $2,500. The letter included a form which represented that Fattah Jr.’s monthly income was $2,500. According to the indictment, Shulick’s companies were paying Fattah, Jr. a salary of $75,000 per year, and Shulick and Fattah Jr. had entered into an agreement to increase Fattah Jr.’s compensation.</p>
<p>Finally, the indictment charges that Shulick filed false federal income tax returns for tax years 2009, 2010, and 2011. According to the indictment, Shulick failed to report all of his taxable income in these years, and improperly claimed itemized deductions.</p>
<p>The charges were announced by United States Attorney Zane David Memeger, FBI Special Agent-in-Charge Michael Harpster, IRS Special Agent-in-Charge Akeia Conner, and Department of Education, Office of Inspector General, Special Agent-in-Charge Geoffrey D. Wood.</p>
<p>If convicted of all charges, Shulick, faces a substantial term of imprisonment, restitution to the School District of Philadelphia and PNC Bank, and a fine of up to $3,800,000.</p>
<p>The case was investigated by the FBI, IRS Criminal Investigation, and the U.S. Department of Education, with the cooperation of the Philadelphia School District’s Office of Inspector General. It is being prosecuted by Assistant United States Attorney Michael T. Donovan.</p>
<p>An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.</p>
<p><a href="https://www.justice.gov/usao-edpa/pr/buisnessman-indicted-embezzlement-and-tax-charges">Original PressReleases&#8230;</a></p>

Financial Fraud: Victor Hugo Soriano Guilty to Commit Mail Fraud in a Scheme to Defraud Insurance Companies
<h2>Modesto Man Pleads Guilty to Staging Car Accidents in a Scheme to Defraud Insurance Companies</h2>
<p>FRESNO, Calif. — Victor Hugo Soriano-Villafan, 26, of Modesto, pleaded guilty today to conspiracy to commit mail fraud in a scheme to defraud insurance companies, Acting U.S. Attorney Phillip A. Talbert announced.</p>
<p>According to court documents, from October 2011 until August 2014, Soriano-Villafan conspired with at least six other individuals to stage dozens of car accidents and submit false claims seeking compensation for the damage caused by the staged accidents. As part of the scheme, the defendants would often offer to repair the recruited individual’s vehicle at automobile repair shops that Soriano-Villafan or a co-defendant owned, usually with less-than-complete repair work, and for a fee that was less than the payment from the insurance company. In all, Soriano-Villafan caused at least $750,000 in false insurance claims to be paid as a result of the conspiracy to defraud.</p>
<p>In each staged accident, Soriano-Villafan and other defendants used two or three vehicles and caused about $5,000 to $10,000 in damage to each vehicle. After each staged collision, the defendants submitted cover stories to the insurer that concealed the true cause of the accident. The cover story would commonly use aliases, false identities, and false addresses when describing the defendants. The defendants also used different vehicles in the staged collisions. They were able to do this by obtaining many different vehicles and using false identities to both register the vehicles with the Department of Motor Vehicles and obtain insurance policies for the vehicles. The defendants did this to avoid scrutiny by the insurer that reviewed the false claims. The defendants repeated the scheme in dozens of crashes by recruiting other individuals to participate in the staged collisions. These individuals would allow their vehicles to be damaged and would submit their own claim for damages. In many instances, false claims were submitted to the recruited individual’s insurance company.</p>
<p>This case is the product of an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the California Department of Insurance, Fraud Division. Assistant United States Attorneys Patrick R. Delahunty and Henry Z. Carbajal III are prosecuting the case.</p>
<p>Soriano-Villafan is scheduled to be sentenced by U.S. District Judge Dale A. Drozd on January 30, 2017. Soriano-Villafan faces a maximum statutory penalty of 20 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.</p>
<p>Charges are pending against co-defendants Juan Ortiz Rivas, 39, of Ceres; Liobigildo Vargas, 46, of Turlock; and, Juan Marquez Cadenas, 30, of Patterson. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.</p>

Financial Fraud: Mark Allen Hartley Sentenced on Multiple Wire Fraud Charges Related To The Theft Over 400 Victims
<h2>Business Owner Sentenced To 36 Months In Prison For Defrauding Over 400 Victims Of $809,205.43</h2>
<p><strong>Owner of Patriot Computers ordered to pay full restitution to victims</strong></p>
<p>LOUISVILLE, Ky. – Mark Allen Hartley, the owner of Patriot Computers, a Virginia corporation, was sentenced this week, in United States District Court, by Chief Judge Joseph H. McKinley Jr., to 36 months in prison, on multiple wire fraud charges related to the theft of $809,205.43 from 434 victims, announced United States Attorney John E. Kuhn, Jr.</p>
<p>“In stealing this money, Hartley victimized many men and women of our armed services,” stated U.S. Attorney Kuhn. “His crime not only exemplifies a shockingly selfish avarice, it is also an affront to the sacrifices made by our servicemembers and their <a class="wpil_keyword_link" href="https://www.fraudswatch.com/category/military-scammer/" title="military" data-wpil-keyword-link="linked" data-wpil-monitor-id="378">military</a> families. My office will do everything in its power to recover every penny of the unpaid restitution for these victims.”</p>
<p>According to the four count indictment and facts admitted in court by the defendant, from December 1, 2012, through April 14, 2014, Hartley, age 56, devised a scheme to defraud First Citizens Bank and its customers. At the time, Hartley operated a business called Spartan Group Inc., dba Patriot Computers. Patriot Computers sold computer equipment to its customers on installment sales contracts. Customers of Patriot Computers agreed to have specified amounts of money taken from their paychecks on a regular basis until their purchases were paid in full. These customers completed payment authorization forms for these payment arrangements, and then Patriot Computers submitted these forms to First Citizens Bank in Hardin County, Kentucky. First Citizens Bank, through its bill payment service, would then transfer the payments from each customer’s paycheck to Patriot Computers’ account at Wells Fargo Bank until the customer’s contract with Patriot Computers was paid in full.</p>
<p>As part of the scheme and artifice to defraud, Hartley created fraudulent payment authorization forms and transmitted those, by e-mail, to First Citizens Bank. This caused First Citizens Bank to transfer unauthorized payments from victims’ paychecks to an account at Wells Fargo Bank, controlled by Hartley. These unauthorized payments totaled approximately $809,205.43. The average loss Hartley caused to each of his 434 individual victims was $1,864. The court ordered full restitution for each individual victim in the amount of the loss they sustained, in addition to restitution to First Citizens Bank for the loss of $126,338.38 it sustained due to Hartley’s scheme.</p>
<p>In entering his plea of guilty, Hartley agreed that the United States could put Patriot Computers’ accounts receivable into receivership, with collections from those accounts being directed to pay restitution to victims.</p>
<p>Hartley’s sentence includes not only the three-year prison sentence but also requires the payment of $809,205.43 in restitution to his victims and a three-year term of supervised release after his prison term. The United States has already collected $150,000 in funds from Hartley that, pending a court order, will be disbursed among victims.</p>
<p>This case was prosecuted by Assistant United States Attorneys Jason Snyder and Jessica R.C. Malloy and was investigated by the Federal Bureau of Investigation (<a href="https://www.fbi.gov/">FBI</a>).</p>
<p><a href="https://www.justice.gov/usao-wdky/pr/business-owner-sentenced-36-months-prison-defrauding-over-400-victims-80920543-0">Original PressReleases&#8230;</a></p>

Healthcare Fraud: Pilar Garcia Lorenzo Convicted Late to Commit Health Care Fraud and Wire Fraud, Money Laundering
<h2>Owner of Florida Home Health Agency Convicted in Multimillion-Dollar Health Care Fraud Scheme</h2>
<p>The owner of a Tampa, Florida, home health agency was convicted by a federal jury for her participation in a multimillion-dollar health care fraud and money laundering scheme.</p>
<p>Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney A. Lee Bentley III of the Middle District of Florida, Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services-Office of Inspector General’s (HHS-OIG) Miami Regional Office and Special Agent in Charge Paul Wysopal of the FBI’s Tampa Field Office made the announcement.</p>
<p>Pilar Garcia Lorenzo (Garcia), 38, of Tampa, the owner of Gold Care Home Health Services Inc. (Gold Care), was convicted late yesterday of one count each of conspiracy to commit<strong> health care fraud</strong> and <strong>wire fraud</strong>, conspiracy to commit<em> money laundering</em> and <strong>money laundering</strong> following a jury trial before U.S. District Judge Charlene Edwards Honeywell of the Middle District of Florida. Sentencing has been scheduled for Jan. 5, 2017.</p>
<p>According to evidence presented at trial, in late summer 2014 Gold Care submitted millions of dollars’ worth of false and fraudulent claims to <strong>Medicare</strong>. The claims were for home health services that had never been provided and had not been legitimately prescribed by a physician. As a result of those false and fraudulent claims, <em>Medicare</em> reimbursed Gold Care approximately $2.5 million. Garcia used a “straw” or nominee owner in an effort to execute and conceal the fraudulent scheme, the evidence showed. Approximately $2 million of the <strong>fraud</strong> proceeds her company received were laundered in cash transactions through fictitious shell companies located in Hialeah, Florida.</p>
<p>HHS-OIG and FBI investigated the case, which was brought as part of the <em>Medicare Fraud Strike Force</em>, under the supervision of the Criminal Division’s Fraud Section and U.S. Attorney’s Office of the Middle District of Florida. This case is being prosecuted by Senior Trial Attorney Christopher J. Hunter and Trial Attorney Angela Adams of the Fraud Section.</p>
<p>Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged over 2,900 defendants who collectively have billed the Medicare program for over $10 billion. In addition, the HHS Centers for Medicare &; Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.</p>
<p>To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to<a href="http://www.stopmedicarefraud.gov/">www.stopmedicarefraud.gov</a>.</p>
<p>Original PressReleases&#8230;</p>

Financial Fraud: Edmund Edward Wilson Guilty to Wire Fraud and Real Estate Fraud Scheme
<h2>St. George Man Sentenced To 108 Months In Federal Prison After Convictions For Fraud, Money Laundering</h2>
<p class="node-subtitle center"><strong>Ordered to Pay $12,227,920 in Restitution to Victims</strong></p>
<p>SALT LAKE CITY – Edmund Edward Wilson, age 72, of St. George, Utah, who pleaded guilty to <strong>wire fraud</strong> and money laundering in connection with a <strong>real estate fraud scheme</strong>, will serve 108 months in federal prison followed by 36 months of supervised release. U.S. District Judge Dee Benson imposed the sentence Thursday afternoon in federal court. Wilson also must pay $12,227,920 in restitution to victims of the fraud scheme.</p>
<p>According to a sentencing memorandum filed by federal prosecutors, Wilson ran a real <em>estate investment scheme</em> from approximately 2005 until 2012. His fraud accelerated in 2009 when businesses were in desperate need for financing, and the economic collapse made such loans more difficult to obtain through traditional means. Wilson sought out individuals all over the country who were developing real estate projects, such as shopping malls or resorts.</p>
<p>Wilson represented to investors that his company could provide financing for real estate development projects for an advance fee of either $80,000 or $150,000 through a “substitution of collateral program.” Through this program, individuals would provide the fee, obtain financing for their projects within 30-60 days (in some cases hundreds of millions of dollars), and not have to repay the <a class="wpil_keyword_link" href="https://www.fraudswatch.com/category/loans/" title="loan" data-wpil-keyword-link="linked" data-wpil-monitor-id="225">loan</a>. In return, these individuals Wilson called “investors” would give Mr. Wilson a 30 percent stake in the development project.</p>
<p>When investors called Wilson to ask why they had not received funding for their projects within the time promised, Wilson falsely represented to investors that he needed additional money to cover various unforeseen fees and expenses, and that once these costs were paid, funds would be released for the development projects. Wilson failed to disclose to investors that he never provided any funding for any development project through his substitution of collateral program and that he used a significant portion of the advanced fees for his personal benefit.</p>
<p>Later in the scheme, Wilson falsely represented to investors who had already invested in his program and to new potential investors that he could arrange financing of their development projects through his wealthy partner in Asia known as “the General.” In exchange for an investment of $80,000 to $150,000, investors would receive a forgivable loan for their real estate development project. The loan would come from “the General” who had access to millions of dollars in U.S. currency set aside for investment projects in the United States.</p>
<p>Again, Wilson failed to disclose to investors that he had never provided any funding for any development project through his foreign investment program and that he used a significant portion of the advanced fees for his personal benefit.</p>
<p>For example, in the wire fraud count he pleaded guilty to, Wilson admitted that around September 2008, he told an investor identified as M.B.K. that if M.B.K. paid $150,000 into his foreign investment program, Wilson could obtain and provide $96,080,000 in financing within 30 days for M.B.K.’s real estate development project of a hotel and spa in Greenville, N.C. As a result of Wilson’s representations, M.B.K. wired $150,000 to Wilson. Wilson admitted he used a portion of the advanced fees M.B.K. paid for his own personal benefit, transferring $100,000 to another account that had nothing to do with his substitution of collateral program or foreign investment program.</p>
<p>“Mr. Wilson never funded a single real estate project. Every iteration of the story Mr. Wilson told was pure fabrication. The majority of funds received by Mr. Wilson were used to cover his personal expenses and expenses of his other businesses which operated at a significant loss. No funds were ever put in escrow as the loan agreements specified,” federal prosecutors wrote in the sentencing memorandum. Wilson declared bankruptcy in August 2012.</p>
<p>The case was prosecuted by the U.S. Attorney’s Office in Utah and investigated by special agents of the FBI and IRS Criminal Investigation.</p>
<p><a href="https://www.justice.gov/usao-ut/pr/st-george-man-sentenced-108-months-federal-prison-after-convictions-fraud-money">Original PressReleases&#8230;</a></p>

Financial Fraud: Group Of Individuals Guilty of Wire Fraud, Bribery and Extortion Charges
<h2>Four Individuals Guilty Of Conspiracy To Commit Federal Programs Bribery, Honest Services Wire Fraud And Extortion</h2>
<p class="node-subtitle center"><strong>Six co-conspirators plead guilty</strong></p>
<p>SAN JUAN, Puerto Rico– Today, after a 25-day trial before U.S. District Court Judge Pedro A. Delgado-Hernández, three women and one man were found guilty of wire fraud, bribery and extortion charges, announced U.S. Attorney for the District of Puerto Rico, Rosa Emilia Rodríguez-Vélez. The four defendants participated in several schemes to corruptly give things of value to public officials within the government of the Commonwealth of Puerto Rico in exchange for favorable treatment and awarding of government contracts to various corporations. The 25-count indictment filed on December of 2015, included charges of conspiracy to commit federal programs bribery and honest services wire fraud, wire fraud, federal program bribery, extortion through fear of economic harm, money laundering, false declarations before a grand jury, and obstruction of justice.</p>
<p>The defendants who were found guilty today are:</p>
<ol>
<li>Sally López Martínez, Administrator of the Commonwealth of Puerto Rico’s “Administración de Desarrollo Laboral” (Workforce Development Administration) (hereinafter “ADL”). She was found guilty of Count One, Conspiracy to Commit Federal Programs Fraud and Wire Fraud; Count Two, Conspiracy to Commit Honest Services Wire Fraud; Counts Three to Five, Honest Services Wire Fraud; and Count Eleven, Receipt of a Bribe by Agent of an Organization Receiving Federal Funds.</li>
<li>Ivonne M. Falcón Nieves, Vice President of the Puerto Rico Aqueduct and Sewer Authority (“AAA”), and former Treasurer of AAA. She was found guilty of Count One, Conspiracy to Commit Federal Programs Fraud and Wire Fraud; Count six, Conspiracy to Commit Honest Services Wire Fraud; Counts Seven to Nine, Honest Services Wire Fraud; Count Thirteen, Receipt of a Bribe by Agent of an Organization Receiving Federal Funds; and Count Seventeen, Extortion Through Fear of Economic Harm.</li>
<li>Marielis Falcón Nieves, sister of Ivonne M. Falcón Nieves. She was found guilty of Count Seventeen, Extortion Through Fear of Economic Harm.</li>
<li>Glenn O. Rivera Pizarro, Special Assistant for Administration at the House of Representatives of Puerto Rico. He was found guilty of Count Twenty-Four, Conspiracy to Commit Wire Fraud; and Count Twenty-Five, Intentional Misapplication of Property by Agent of an Organization Receiving Federal Funds.</li>
</ol>
<p>Their sentences were scheduled for February 6, 2017.</p>
<p>The other defendants are:</p>
<ol>
<li>Anaudi Hernández Pérez, businessman and political fund raiser. Although not named in official corporate records, he exercised <em>de facto </em>control over numerous companies doing business with agencies and public corporations of the Commonwealth of Puerto Rico. He plead guilty on February 18, 2016.</p>
</li>
<li>
<p>Sonia M. Barreto Colón, Purchasing Director of the Commonwealth of Puerto Rico’s Aqueduct and Sewer Authority. She plead guilty on May 31, 2016.</p>
</li>
<li>
<p>Javier A. Muñiz Álvarez, businessman. Utilized the Company JM Profesional (sic) &; Training Group, Inc. to secure contracts from the Commonwealth of Puerto Rico. He plead guilty on June 29, 2016.</p>
</li>
<li>
<p>Carlos F. Luna Cruz, businessman. He worked for JM Profesional (sic) &; Training Group, Inc., and plead guilty on April 28, 2016.</p>
</li>
<li>
<p>Xavier González Calderón, Administrator for the House of Representatives of the Commonwealth of Puerto Rico. He plead guilty on August 9, 2016.</p>
</li>
<li>
<p>Victor R. Burgos Cotto, Director of Technology for the House of Representatives. He plead guilty on July 13, 2016.</p>
</li>
</ol>
<p>According to the evidence presented at trial, Hernández Pérez utilized his political and personal connections with high ranking members of the current government in order to have “his people” appointed in critical government positions within the new administration which took over after the November 2012 elections. He also provided those individuals with things of value in exchange for government contracts, benefits and preferential treatment for several of his corporations. The indictment focused on benefits Hernández Pérez, his co-conspirators, and corporate entities, obtained from the Commonwealth of Puerto Rico’s “Administración de Desarrollo Laboral” (Workforce Development Administration) (hereinafter “ADL”), the Commonwealth of Puerto Rico’s Aqueduct and Sewer Authority, and the Puerto Rico House of Representatives.</p>
<p>Hernández Pérez and his co-conspirators utilized their government influence to receive an unfair competitive advantage over their competitors, in that they: a) received preferred opportunities on certain government “request for proposals” (“RFPs”); b) received guidance from agency employees on the proper format and content of proposals and bids for government contracts; c) had access to speak and meet with critical employees in decision making positions within the agencies, departments and government corporations; d) received guidance on how to structure bids and proposals in order to avoid the formal bidding process required by law; e) demanded and were provided with explanations from agency employees when their proposals or bids were not selected.</p>
<p>Once awarded the government contracts, Hernández Pérez and his co-conspirators would utilize, often without proper contractual authority, subcontractors who would perform the work defined in the contracts. On many occasions, Hernández Pérez and his co-conspirators provided substandard work on their contractual obligations in that they: a) failed to make the required payments to suppliers, subcontractors and creditors; b) failed to abide by the terms of the contract regarding performance results/follow up as required under the contract; c) failed to competently provide the services they were contracted to perform.</p>
<p>Defendants Ivonne Falcón and Marielis Falcón, were also charged with Hobbs Act extortion under fear of economic harm. Hernández Pérez and unindicted co-conspirators would utilize their contacts and influence within at least one government dependency (the AAA) to secure, for a fee, the release of legitimate payments due to other corporations, which lacked the current connections within the government. In particular, Hernández Pérez and his associates, obtained property not due to them, specifically, $100,000.00 from Contractor A, in exchange for utilizing his connections within AAA in order to secure a portion of the money owed (approximately $1,000,000) to Contractor A, with Contractor A’s consent, induced through the wrongful use of a fear of economic loss. Moreover, the Falcón sisters, aided and abetted each other to commit extortion. Defendant Ivonne M. Falcón Nieves utilized her position at AAA in order to enable her sister, defendant Marielis Falcón Nieves, to obtain property not due to her, specifically, cash payments, check payments, payments to contractors, and the performance of residential tree trimming, from Contractor A, with Contractor A’s consent, induced through the wrongful use of a fear of economic loss.</p>
<p>The case was investigated by the FBI’s San Juan Division. The case is being prosecuted by First Assistant U.S. Attorney Timothy Henwood and José Capó Iriarte, Chief of the Criminal Division. If found guilty, the defendants are facing possible sentences of up to five years for the conspiracy to commit federal programs fraud and wire fraud, up to 10 years for honest services fraud, up to 20 years for money laundering, Hobbs Act, obstruction of justice, and conspiracy to commit honest services fraud.</p>
<p><a href="https://www.justice.gov/usao-pr/pr/four-individuals-guilty-conspiracy-commit-federal-programs-bribery-honest-services-wire">Original PressReleases&#8230;</a></p>