Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that ALEXANDRU BURDUCEA, a doctor who practiced in Manhattan, pled guilty today to conspiracy to violate the Anti-Kickback Statute in connection with a scheme to prescribe Subsys, a potent fentanyl-based spray, in exchange for bribes and kickbacks from Subsys’s manufacturer, Insys Therapeutics (“Insys”).  BURDUCEA pled guilty before U.S. Magistrate Judge Kevin Nathaniel Fox.  The case is assigned to U.S. District Judge Kimba M. Wood.

U.S. Attorney Geoffrey S. Berman said:  “As he admitted today, Alexandru Burducea, a prominent Manhattan pain management doctor, accepted tens of thousands of dollars in speaker fees from Insys in exchange for prescribing large volumes of Insys’s powerful fentanyl-based spray, Subsys.  The corrupting influence of money has no place in medicine, especially when it comes to prescribing fentanyl and other dangerous opioids.  Like many other doctors around the country, Dr. Burducea is now being held to account for his participation in this corrupt kickback scheme.”           

According to the allegations contained in the Indictment against BURDUCEA and filings in related proceedings:

The Insys Speakers Bureau 

Subsys, which is manufactured by Insys, is a powerful painkiller approximately 50 to 100 times more potent than morphine.  The U.S. Food and Drug Administration (“FDA”) approved Subsys only for the management of breakthrough pain in cancer patients.  Prescriptions of Subsys typically cost thousands of dollars each month, and Medicare and Medicaid, as well as commercial insurers, reimbursed prescriptions written by BURDUCEA.

In or about August 2012, Insys launched a “Speakers Bureau,” a roster of doctors who would conduct programs (“Speaker Programs”) purportedly aimed at educating other medical practitioners about Subsys.  In reality, Insys used its Speakers Bureau to induce the doctors who served as speakers to prescribe large volumes of Subsys by paying them Speaker Program fees.  Speakers were supposed to conduct an educational slide presentation for other health care practitioners at each Speaker Program.  In reality, many of the Speaker Programs were predominantly social affairs where no educational presentation about Subsys occurred.  Attendance sign-in sheets for the Speaker Programs were frequently forged by adding the names and signatures of medical practitioners who were not present.

BURDUCEA’s Participation in the Scheme

BURDUCEA, a doctor certified in pain management and anesthesiology, was an Assistant Professor of Anesthesiology at a large Manhattan hospital.  BURDUCEA also practiced at an anesthesiology and pain management office associated with the hospital.  From in or about September 2014 until in or about June 2015, BURDUCEA received approximately $68,400 in Speaker Program fees from Insys in exchange for prescribing large volumes of Subsys.  In addition, Insys hired BURDUCEA’s then-girlfriend, now wife, to work as BURDUCEA’s sales representative, and the company paid her large commissions based on the volume of Subsys prescribed by her assigned doctors, including BURDUCEA. 

BURDUCEA, who had never prescribed Subsys before in or about September 2014, became approximately the 14th-highest prescriber of Subsys nationally in the second quarter of 2015, accounting for total net sales of the drug of approximately $621,345 in that quarter.

*                *                *

BURDUCEA, 42, of Little Neck, New York, pled guilty to one count of conspiracy to violate the Anti-Kickback Statute, which carries a maximum sentence of five years in prison.  The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  BURDUCEA is scheduled to be sentenced by Judge Wood on May 22, 2019, at 11:00 a.m.

Mr. Berman praised the outstanding investigative work of the Federal Bureau of Investigation and thanked the U.S. Department of Health and Human Services Office of Inspector General for its assistance in the investigation.

The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorneys Noah Solowiejczyk and David Abramowicz are in charge of the prosecution.

HAMMOND- Darren Bell, 19 and Altonio Benson, 27, both of Detroit, Michigan, were charged in a criminal complaint with robbery affecting interstate commerce for the robbery of a jewelry store in Hobart, Indiana, announced U.S. Attorney Kirsch. 

The criminal complaint alleges that at approximately 7:05 pm on January 25, 2019, three individuals participated in the robbery of a jewelry store in Hobart, Indiana, while the store was open to customers.  At least two individuals smashed display cases with hammers to take jewelry, and the individuals fled the store with approximately $803, 000 in jewelry.  Bell and Benson were apprehended a short time later. 

U.S. Attorney Kirsch said, “Brazen robberies such as this case commands a swift response from law enforcement.  I want to commend all our law enforcement partners for their work in investigating this case.  We will continue to aggressively investigate and prosecute these type of crimes in this District.” 

The United States Attorney’s Office emphasizes that a criminal complaint is merely an allegation and that all persons are presumed innocent until, and unless proven guilty in court.

If convicted, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.

This case is being investigated by the Federal Bureau of Investigation’s Gang Response Investigative Team and Hobart Police Department.  This case is being prosecuted by Assistant United States Attorney Nicholas J. Padilla.

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TULSA, Okla. –U.S. Attorney Trent Shores announced today that the Northern District of Oklahoma collected $2,159,920 in criminal and civil actions in Fiscal Year 2018, representing a jump in collections as compared to Fiscal Year 2017.  Of this amount, $1,258,097 was collected in criminal actions and $901,833 was collected in civil actions. 

Additionally, the Northern District of Oklahoma worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $8,609,640 in cases pursued jointly by these offices.  Of this amount, $2,879 was collected in criminal actions and $8,606,760 was collected in civil actions.         

As a whole, the Justice Department collected nearly $15 billionin civil and criminal actions in the fiscal year ending Sept. 30, 2018.  The $14,839,821,650 in collections in FY 2018 represents is nearly seven times the appropriated $2.13 billion ($2,136,750,000) budget for the 94 U.S. Attorneys’ offices.

U.S. Attorney Shores stated, “The United States Attorney’s Office diligently collected this money on behalf of American taxpayers and victims of crime. The recovered monies go directly to crime victims to help compensate them for their physical injuries or financial loss. To all those who owe money to the United States as the result a criminal or civil debt, there will be a day of accounting. You will pay out of pocket or through the forfeiture of your criminally obtained assets. This U.S. Attorney’s Office will see victims wholly restored, restitution and fines paid in full, and civil financial obligations satisfied.”

“The men and women of the U.S. Attorneys’ offices across the country work diligently, day in and day out, to see that the citizens of our nation receive justice.  The money that we are able to recover for victims and this country as a whole is a direct result of their hard work,” Director James A. Crowell, IV, Executive Office for U.S. Attorneys.

In one case, the court ordered a criminal defendant to pay $153,610.35 in restitution.  After release from prison, the Northern District of Oklahoma’s U.S. Attorney’s Office doggedly pursued the defendant and, through garnishment, asset hearings and seizure of retirement accounts, collected the total amount of restitution.  In another criminal case, a defendant was ordered to pay restitution of $79,942.52.  Though the office is still pursuing collection in the case, significant amounts have been recovered using the Treasury Offset Program, which allows the government to intercept tax refunds.

The civil False Claims Act is an important tool used to protect the integrity of taxpayer-funded health care programs and allows the government to address losses it sustains by providing for civil monetary penalties. In 2018, the U.S. Attorney’s Office assessed such a penalty against a nurse involved in pharmacy kickbacks. The nurse immediately began making payments voluntarily to pay off her debt of more than $130,000. 

The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims.  The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.  While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.

The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws.  In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, the Department of Health and Human Services, the Internal Revenue Service, the Small Business Administration and the Department of Education.

WHEELING - U.S. Attorney Bill Powell announced today that the Northern District of West Virginia collected $1,815,859 in criminal and civil actions in Fiscal Year 2018.  Of this amount, $654,180 was collected in criminal actions and $1,161,679 was collected in civil actions.  

As a whole, the Justice Department collected nearly $15 billion in civil and criminal actions in the fiscal year ending Sept. 30, 2018.  The $14,839,821,650 in collections in FY 2018 represents is nearly seven times the appropriated $2.13 billion ($2,136,750,000) budget for the 94 U.S. Attorneys’ offices.

“The men and women of the U.S. Attorneys’ offices across the country work diligently, day in and day out, to see that the citizens of our nation receive justice.  The money that we are able to recover for victims and this country as a whole is a direct result of their hard work,” Director James A. Crowell, IV, Executive Office for U.S. Attorneys.

“In addition to our responsibility to protect the public, we have the additional responsibility to recoup, to the extent possible, money improperly taken from victims of criminal or civil wrongdoing, whether the victim is an individual, business, or taxpayer.  We take these responsibilities seriously and will continue to do so in coordination with our law enforcement and agency partners,” said Powell.
     
In 2018, the Northern District of West Virginia recovered $1,091,348 as part of the settlement in the case against several physicians and a kickback scheme. Four doctors agreed to pay back their respective sums after they were accused of participating in a kickback scheme with Southwest Laboratories, Medscan Laboratory, sales representatives affiliated with Southwest and Medscan and others, thereby causing false claims to be submitted to Medicare in violation of the Federal False Claims Act, the Physician Self-Referral law, and the Anti-Kickback Statute. An additional physician paid $650,000 as a part of the case in Fiscal Year 2019.
 
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims.  The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.  While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs. 

The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws.  In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, the Department of Health and Human Services, the Internal Revenue Service, the Small Business Administration and the Department of Education.
 

Earlier today, following a two-week trial, a federal jury in Brooklyn returned a guilty verdict against Humberto Baez for conspiring to import and distribute cocaine, and for possessing with intent to distribute cocaine, in connection with his participation in a scheme responsible for smuggling 16 kilograms of cocaine into the United States through the Dominican Republic in February 2018.  When sentenced by United States District Judge Jack B. Weinstein, the defendant faces a mandatory minimum sentence of 10 years’ imprisonment.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, and Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Field Division (DEA), announced the verdict.

“The defendant’s scheme to conceal 16 kilograms of cocaine in a shipment of chili peppers wasn’t such a hot idea, and with today’s verdict, he has been held responsible for his crimes,” stated United States Attorney Donoghue.  “I commend the prosecutors and the Drug Enforcement Administration agents for their excellent work in preventing illegal narcotics from being distributed in our country.” 

“Drug traffickers go to extraordinary lengths to bring poison into our country,” stated DEA Special Agent-in-Charge Donovan.  “The DEA has seen smuggling groups conceal drugs in bananas, floor tiles, exotic statues and even animals.  This conviction sends a message to drug trafficking organizations that law enforcement is on watch.  I applaud the U.S. Attorney’s Office for the Eastern District of New York and our law enforcement partners in their diligent efforts to bring Baez and other drug traffickers to justice.”

Between August 2016 and March 2018, Baez, a produce importer based in Pennsylvania, conspired with others to import cocaine, hidden inside a shipping container, into the United States.  In furtherance of the conspiracy, Baez contacted an individual who, unbeknownst to Baez was cooperating with the DEA, to use the individual’s importing company as a front to transport cocaine from Baez’s source of supply in the Dominican Republic.  Baez and his co-conspirators then set up two “dry run” shipments containing only produce into the Red Hook Terminal in Brooklyn, to establish the appearance of a legitimate business relationship between the exporter and importer and not attract scrutiny when subsequently shipping cocaine.  In late February 2018, a third shipment arrived in Miami, Florida with approximately 16 kilograms of cocaine concealed in cardboard boxes containing chili peppers.  Baez informed the cooperator that the third shipment contained “ripe tomatoes,” using agreed upon code words for cocaine, and instructed him to transport the narcotics by truck to Baez’s warehouse in Pennsylvania.  On March 1, 2018, law enforcement officers searched the container and seized the hidden cocaine. 

The government’s case is being handled by the Office’s International Narcotics & Money Laundering Section.  Assistant United States Attorneys Nomi D. Berenson and Erin M. Reid are in charge of the prosecution.

The Defendant:

HUMBERTO BAEZ
Age:  50
Lancaster, Pennsylvania

E.D.N.Y. Docket No. 18-cr-168 (JBW)

PITTSBURGH – Bryan Campbell, 27, of Pittsburgh, Pennsylvania, has been sentenced in federal court to 15 years and one month in prison, to be followed by three years of supervised release on his convictions for conspiring to rob three area banks, armed bank robbery, attempted armed bank robbery and brandishing a firearm during and in relation to a crime of violence, United States Attorney Scott W. Brady announced today.

On February 13, 2019, United Stated District Court Judge Cathy Bissoon imposed the sentence on Campbell. Campbell was initially charged by criminal complaint on March 8, 2019 and has been detained since his initial appearance.

According to information presented to the court, Campbell with co-defendant Daymon Ottey conspired to rob the S&T Bank in Verona, PA, on March 7, 2017, the First National Bank in Verona, PA, on May 1, 2017, and the Huntington Bank in Baden, PA, on July 22, 2017. Campbell robbed the S&T Bank in Verona, PA, on March 7, 2017 using a silver firearm to hold bank employees at gunpoint. Ottey acted as the getaway driver for this robbery using his girlfriend’s vehicle. On May 1, 2017, Campbell entered the First National Bank in Verona, PA with the same silver firearm and held employees at gun point demanding money. Campbell then scaled the teller station and entered the bank’s vault taking over $84,000 before fleeing. After this robbery, Campbell and Ottey split the proceeds, enabling Ottey to buy a new Jeep Cherokee vehicle. Campbell’s girlfriend also posted photos on social media of lavish meals, jewelry and vacations provided to her by Campbell. This information helped FBI to identify Campbell as a possible suspect. Finally, on July 22, 2017, Ottey drove Campbell in the Jeep Cherokee purchased with the prior bank robbery proceeds to the Huntington Bank in Baden, PA. Campbell entered the bank with the same silver firearm and attempted to rob it but was interrupted when an Economy Police Department vehicle pulled in the driveway. Campbell fled without receiving any money.

This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.

Assistant United States Attorney Timothy M. Lanni is prosecuting this case on behalf of the Government.

The FBI Pittsburgh’s Violent Crimes Task Force, with assistance from the Plum Police Department, Verona Police Department, Economy Borough Police, Allegheny County Sherriff’s Department, and Shaler Township Police Department conducted the investigation leading to the indictment in this case.

GREENEVILLE, Tenn. – On February 12, 2019, a grand jury sitting in Greeneville, Tennessee, returned an nine-count indictment against Xiaorong You, a/k/a Shannon You, 56, of Lansing, Michigan, and Liu Xiangchen, 61, of Shandong Province, China, for conspiracy to commit theft of trade secret information (TSI) related to formulations for bisphenol-A-free (BPA-free) coatings.  You was also indicted on seven counts of theft of trade secrets and one count of wire fraud. 

The BPA-free TSI allegedly stolen by these individuals belonged to multiple owners and cost an estimated total of $119,600,000 to develop. Until recently, bisphenol-A (BPA) was used to coat the inside of cans and other food and beverage containers to help minimize flavor loss and prevent the container from corroding or reacting with the food or beverage contained therein.  However, due to the potential for BPA to be harmful to human health, companies began searching for BPA-free alternatives. These alternatives are difficult and expensive to develop.

From December 2012 through August 31, 2017, You was employed as Principal Engineer for Global Research by a company in Atlanta, Georgia, which had agreements with numerous companies to conduct research and development, testing, analysis, and review of various BPA-free technologies.  Due to her extensive education and experience with BPA and BPA-free coating technologies, she was one of a limited number of employees with access to TSI belonging to the various owners.  From approximately September 2017 through June 2018, You was employed as a packaging application development manager for a company in Kingsport, Tennessee, where she was one of a limited number of employees with access to TSI belonging to that company.

Details of the conspiracy are included in the indictment on file with the U.S. District Court.  The indictment alleges that You, Xiangchen, and a third co-conspirator formulated a plan in which You would exploit her employment with the two American employers to steal TSI and provide the information for the economic benefit of persons other than the TSI owners, including a Chinese company that would manufacture and profit from products developed using the stolen TSI. 

“Our office is committed to working closely with our federal, state and local partners to identify and prosecute those who engage in illegal and deceptive practices to steal trade secret and protected information from companies who spend millions of dollars to develop it. Not only can theft of this information be potentially devastating to our American companies, it could also pose a threat to our overall national and economic security,” said J. Douglas Overbey, U.S. Attorney for the Eastern District of Tennessee.

“The conduct alleged in today’s indictment exemplifies the rob, replicate and replace approach to technological development,” said Assistant Attorney General Demers.  “Xiaorong You is accused of an egregious, premediated theft and transfer of trade secrets worth more than $100 million for the purpose of setting up a Chinese company that would compete with the American companies from which the trade secrets were stolen.  Unfortunately, China continues to use its national programs, like the ‘Thousand Talents,’ to solicit and reward the theft of our nation’s trade secrets and intellectual property, but the Justice Department will continue to prioritize investigations like these, to ensure that China understands that this criminal conduct is not an acceptable business or economic development practice.”

“The facts laid out in this indictment show the conspirators engaged in blatant criminal activity,” said Executive Assistant Director Tabb.  “They didn't stop at going after technical secrets belonging to just one company.  They allegedly targeted multiple companies and made off with trade secrets at an estimated value of almost 120 million dollars.  As this case demonstrates, the FBI is determined to do everything possible to bring to justice those who try to steal secrets belonging to American companies.”

Assistant U.S. Attorney TJ Harker and National Security Division Trial Attorney Matthew Walczewski will prosecute the case for the U.S. Attorney's Office for the Eastern District of Tennessee.  The investigation was conducted by the FBI.

Members of the public are reminded that an indictment constitutes only charges and that every person is presumed innocent until his or her guilt has been proven beyond a reasonable doubt in a court of law.

LAS VEGAS, Nev. – Two men made their initial appearances in federal court yesterday on charges related to the possession of 65 firearms, including machine guns, and silencers, stolen at a Las Vegas gun show last month, announced U.S. Attorney Nicholas A. Trutanich of the District of Nevada and Special Agent in Charge Ray Roundtree of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).

Jamikko Foster, 27, and Eduardo Limon, 28, both of Las Vegas, were each charged with possession of a stolen firearm and possession of an unregistered firearm. Foster is also charged with theft of a firearm from a Federal Firearms Licensee (FFL) and unlawful possession of a machine gun. United States Magistrate Judge Nancy Koppe set a preliminary hearing for both defendants for February 27, 2019.

As alleged in the criminal complaint, from January 20 to 29, 2019, a total of 65 firearms and suppressors, also known as “silencers,” were stolen from the business inventory of three separate FFLs at the 2019 Shooting, Hunting, and Outdoor Trade (SHOT) Show in Las Vegas. The SHOT Show, held annually at a Las Vegas convention center, requires FFLs to either disable or remove the firing pins from all displayed firearms. Based on these circumstances, ATF issued an alert to FFLs to be on the lookout for weapons missing firing pins.

On February 10, a FFL alerted ATF about two men who inquired about purchasing a firing pin for an AR-style firearm. ATF was able to identify Foster and Limon from surveillance footage.

On February 11, law enforcement executed a search warrant at Foster’s apartment where they recovered 56 firearms, machine guns, and silencers. The next day, a search warrant was executed at Limon’s residence and law enforcement recovered an additional 10 firearms and silencers. One of the recovered pistols had a clamp attached to a security cable, which was still attached to the trigger guard.

If convicted, the maximum statutory penalty is 10 years in prison for each count and a $250,000 fine.

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

The case was investigated by the ATF San Francisco Field Division’s Las Vegas Field Office and the Las Vegas Metropolitan Police Department. Assistant U.S. Attorney Phillip N. Smith Jr. is prosecuting the case.

To report a tip about stolen firearms contact the ATF at 1-888-ATF-TIPS (1-888-283-3473).

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NASHVILLE, Tenn. – February 14, 2019 – Jamal J. Gardner, 47, of Columbia, Tennessee, was charged today in a criminal complaint with being a convicted felon in possession of a firearm, announced U.S. Attorney Don Cochran for the Middle District of Tennessee. 

“As I have said many times, when a law enforcement officer in this district is assaulted, we will bring federal charges whenever possible,” said U.S. Attorney Cochran.  “This was an extremely violent encounter and we are grateful that lives were not lost.  We will hold this defendant accountable for his actions.”

According to the criminal complaint, a Columbia Police Officer initiated a traffic stop of a vehicle matching the description of a report of a reckless driver.  As the officer approached the vehicle, he observed the driver holding a rifle and the driver immediately began firing at the officer. As the officer took cover and returned fire, the driver, later identified as Jamal Gardner, fled into a nearby residence and continued firing at responding officers.  Gardner fired approximately 80 rounds, from at least four firearms, before escaping from the house. 

On February 8, 2019, Gardner surrendered to police in Detroit, Michigan and is awaiting transfer to the Middle District of Tennessee. 

If convicted, Gardner faces a minimum sentence of 15 years and up to life in prison.

This case was investigated by the Columbia Police Department; the 22^nd Judicial District Attorney’s Office and the Bureau of Alcohol, Tobacco, Firearms & Explosives.  Assistant U.S. Attorney Thomas J. Jaworski is prosecuting the case.

A criminal complaint is merely an accusation.  The defendant is presumed innocent until proven guilty in a court of law.

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          SANTA ANA, California– A former employee of Fannie Mae in Irvine has been found guilty of federal fraud charges related to bribes and kickbacks she took from brokers in exchange for Fannie Mae real estate listings and her approval of discounted sales of Fannie Mae-owned properties.

          Shirene Hernandez, 46, of Corona, was found guilty on Tuesday of two wire fraud counts that involved the deprivation of honest services. Following the guilty verdicts on Tuesday, a federal jury on Wednesday found that Hernandez must forfeit a piece of property she derived from her criminal conduct.

          According to the evidence presented at a five-day trial, Hernandez was a sales representative at the Federal National Mortgage Association (Fannie Mae), a government-sponsored entity under the conservatorship of the Federal Housing Finance Agency (FHFA). As part of its operations, Fannie Mae acquires properties through foreclosures and other methods, and then manages and sells those properties for Fannie Mae’s benefit. Since at least 2012, Fannie Mae’s profits have gone to the United States Treasury Department for the benefit of the U.S. taxpayer.

          As a sales representative, a position she held from 2010 until 2015, Hernandez assigned Fannie Mae-owned properties to real estate brokers and approved sales of the properties based on offers the brokers submitted. In violation of Fannie Mae rules and federal law, Hernandez approved sales of Fannie Mae-owned properties at discounted prices to herself and to the brokers who paid her kickbacks. She also received bribes – mostly in cash payments – in return for listings and commissions that brokers earned on real estate sales.

          Hernandez also assigned listings to family members who received nearly $2 million in commissions in less than three years. For her part in the scheme, Hernandez received more than $1 million in benefits, including the cash kickbacks and equity in a property she obtained with kickback money.

          As part of the scheme, Hernandez purchased a Fannie Mae-owned property in Sonoma that she was responsible for selling, after she rejected higher, market-priced offers in favor of her own below-market price. Hernandez purchased the Sonoma property through intermediaries and affiliates that she controlled, selling it first to a company affiliated with a broker who was bribing her, then directing the broker to transfer the property to her sister-in-law, who paid for the property with a duffel bag filled with $286,450 in cash she received from Hernandez – far below the market price. The Sonoma property was rented out and Hernandez received the rent proceeds. The jury on Wednesday found this property – which now is worth hundreds of thousands of dollars more than the purchase price – should be forfeited to the U.S. government.

          United States District Judge Andrew J. Guilford has scheduled a May 13 sentencing hearing for Hernandez, who faces a statutory maximum of 20 years in federal prison on each of the two felony offenses.

          The case was investigated by the Federal Housing Finance Agency, Office of Inspector General (FHFA-OIG).

          The prosecution is being handled by Assistant United States Attorney Kerry L. Quinn of the Major Frauds Section and Assistant United States Attorney Ian V. Yanniello of the General Crimes Section.

Birmingham, AL-- U.S. Attorney Jay E. Town announced today that the Northern District of Alabama collected $9,044,060.80 in criminal and civil actions in Fiscal Year 2018.  Of this amount, $7,221,160.63 was collected in criminal actions and $1,822,900.17 was collected in civil actions. 

Additionally, the Northern District of Alabama worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $1,651,100.00 in cases pursued jointly by these offices. 

As a whole, the Justice Department collected nearly $15 billionin civil and criminal actions in the fiscal year ending Sept. 30, 2018.  The $14,839,821,650 in collections in FY 2018 represents is nearly seven times the appropriated $2.13 billion ($2,136,750,000) budget for the 94 U.S. Attorneys’ offices.

“The men and women of the U.S. Attorneys’ offices across the country work diligently, day in and day out, to see that the citizens of our nation receive justice.  The money that we are able to recover for victims and this country as a whole is a direct result of their hard work,” Director James A. Crowell, IV, Executive Office for U.S. Attorneys.

“The prosecutors and support staff in my office strive each day to put criminals behind bars and protect the public fisc, and the collection of civil and criminal debts is an essential part of that,” Town said.  “The forfeitures collected shows our continued commitment to pursue the recovery of those ill-gotten gains so that victims of crime and the federal treasury can be given restitution.  We will continue to do so aggressively.”

            The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims.  The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.  While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.

            The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws.  In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, the Department of Health and Human Services, the Internal Revenue Service, the Small Business Administration and the Department of Education.

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WASHINGTON – Roland J. Bourgeois Jr., 55, of New Orleans, Louisiana, was sentenced to 10 years imprisonment, followed by five years of supervised release on charges that, in the wake of Hurricane Katrina, he shot at three young African-American men because of their race as the men attempted to evacuate New Orleans, announced Assistant Attorney General for the Civil Rights Division Eric Dreiband; U.S. Attorney for the Eastern District of Louisiana Peter G. Strasser; and FBI New Orleans Division Special Agent in Charge Eric J. Rommal.

“Today’s sentencing brings closure to this race-motivated shooting that occurred over 13 years ago, in the wake of Hurricane Katrina,” said Assistant Attorney General Eric Dreiband.  “This sentence sends a clear message to those who attempt to divide our community with violence and fear that the Department of Justice will work tirelessly to prosecute perpetrators of hate-motivated violence.” 

“Upholding the civil rights of our citizens is one of the most important duties of the Department of Justice.  This sentencing clearly demonstrates the tenacity of law enforcement to hold individuals responsible for their actions, despite the passage of time,” said U.S. Attorney Strasser. “Hurricane Katrina was a tragic chapter in the history of our city.  Hopefully this plea brings some measure of finality to those directly affected by this crime and to this great city that endured so much in the days following this calamity.”

Eric Rommal, FBI New Orleans Special Agent in Charge stated: “Justice is blind, but she is also patient.  Mr. Bourgeois’ cowardly, unprovoked, and racially based violent acts were unjustly carried out upon his victims over a decade ago, leaving the victims, their families, and our community torn by hate.  We hope his sentencing will help the healing process and serve notice that violence especially borne from hate, will never be tolerated and the FBI remains committed to upholding the Constitution and protecting civil rights.”

According to documents filed in connection with the plea, shortly after Hurricane Katrina struck New Orleans, Bourgeois and other white male residents of the Algiers Point neighborhood agreed that they would use force to keep out African Americans from their neighborhood. They moved fallen trees to barricade the streets near their homes and started armed patrols of the neighborhood.

On Sept. 1, 2005, three young African-American men – D.H., M.A., and C.C. – walked to Algiers Point in an effort to reach the ferry landing, a site that state and federal agencies were using as an evacuation point. When the three men crossed a barricade constructed by Bourgeois and others, Bourgeois opened fire with a shotgun, wounding all three men. After the men fled, Bourgeois boasted that he had “got one” and pledged to “kill that [racial slur]” if the man had survived.  Bourgeois warned one of his neighbors: “Anything coming up this street darker than a brown paper bag is getting shot.”

The prosecution of this matter was delayed because the defendant was repeatedly found incompetent to stand trial after being charged in July, 2010. The defendant’s competency was evaluated six different times between 2010 and 2018. After he was declared competent in 2018, Bourgeois pleaded guilty in October 2018.

The FBI conducted the investigation.  The case was prosecuted by Special Litigation Counsel Jared Fishman and Trial Attorney Mary J. Hahn of the Civil Rights Division, and Assistant United States Attorney David Howard Sinkman of the Eastern District of Louisiana.

For more information about DOJ’s work to combat and prevent hate crimes, visit www.justice.gov/hatecrimes: a one-stop portal with links to DOJ hate crimes resources for law enforcement, media, researchers, victims, advocacy groups, and other organizations and individuals.

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NASHVILLE, Tenn. – February 14, 2019 – A federal jury returned guilty verdicts today on all counts against James Frei,  of Union Mills, North Carolina, after a trial on child pornography related offenses, announced U.S. Attorney Don Cochran for the Middle District of Tennessee.  Frei was indicted in March 2017 and charged with child pornography offenses, including production and transportation of child pornography, on-line enticement of a minor and traveling to have sex with a minor.

According to evidence and testimony at trial, in July 2016, the National Center for Missing and Exploited Children (NCMEC) received a cyber-tip from Facebook regarding an adult male engaging in sexually explicit conversations with a minor female, later identified as a 15 year-old living in Nashville.  The conversations indicated that the adult may have already traveled to Nashville to have sex with the minor female.  This information was relayed to the Metropolitan Nashville Police Department (MNPD) for further investigation.

A MNPD detective interviewed the minor and learned that she had met the man, later identified as Frei, in May 2016 through a teen chat room on Facebook and that he had traveled to Nashville multiple times in May 2016 and went to her house after her father had left for work, where they engaged in sexual activity.  The minor female was then driven to a nearby park where they again engaged in sexual activity.  Frei returned to Nashville for a few days in June 2016 and on two occasions, he took the minor to a hotel near the airport and engaged in sexual activity. The detective also learned that Frei had recorded the sexual encounters with his cell phone.

A subsequent search warrant served at Frei’s North Carolina home resulted in the seizure and forensic examination of his cell phone, which was found to contain numerous images and videos of him engaging in sex with the minor female.    

Frei faces up to life in prison when he is sentenced on May 20, 2019.  The production of child pornography charge carries a mandatory minimum sentence of 15 years in prison. 

This case was investigated by the Metropolitan Nashville Police Department and is being prosecuted by Assistant U.S. Attorneys Katy Risinger and Christopher Suedekum.

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GREENVILLE– United States Attorney Robert J. Higdon, Jr. announced that in federal court, Senior United States District Judge Malcolm J. Howard sentenced KYLE ROBERT PERRY, 27, of Kenly, North Carolina to 144 months imprisonment, followed by 5 years of supervised release.

The prosecution of PERRY was a part of an  Organized Crime and Drug Enforcement Task Force Operation (OCDETF), which has focused on methamphetamine manufacturers and distributors in Wilson and Wayne counties.

PERRY was named in an eight-count Indictment filed on December 6, 2017 charging him with conspiracy to manufacture, distribute, dispense and possess with the intent to distribute methamphetamine and a mixture and substance containing a detectable amount of methamphetamine from 2009 until December 15, 2015; possession of equipment, chemicals, products and materials with the intent to manufacture methamphetaime; and distribute of a quantity of a mixture and substance containing a detectable amount of methamphetamine.  On April 9, 2018, PERRY pled guilty to the conspiracy charge.   

The investigation showed that  PERRY was a part of a drug trafficking organization that manufactured and distributed methamphetamine in Wilson County, North Carolina.  PERRY utilized at least five other people to purchase pseudoephedrine on his behalf, which is one of the main ingredients utilized in the manufacturing of methamphetamine.  On September 3, 2015, officers conducted a search of PERRY’s home and located several items utilized in the manufacturing of methamphetamine including a hydrochloric generator, a stripped lithium battery, a bottle with tubing and an empty pseudoephedrine package.  Due to the hazardous nature of these items, they were removed by the North Carolina State Bureau of Investigation’s Clandestine Unit.  PERRY’s manufacturing of methamphetamine created a substantial risk of harm to human life or the environment.

This prosecution is part of an extensive investigation by the Organized Crime Drug Enforcement Task Force (OCDETF).  OCDETF is a joint federal, state, and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations, and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.

That effort has been implemented through the Take Back North Carolina Initiative of The United States Attorney’s Office for the Eastern District of North Carolina.  This initiative emphasizes the regional assignment of federal prosecutors to work with law enforcement and District Attorney’s Offices on a sustained basis in those communities to reduce the violent crime rate, drug trafficking, and crimes against law enforcement.

Investigation of this case was conducted by the North Carolina State Bureau of Investigation, Wilson County Sheriff’s Office, and Wilson Police Department.  Assistant United States Attorney Dena King represented the government. 

WASHINGTON – A Baton Rouge, Louisiana-based doctor pleaded guilty yesterday and his medical billing supervisor pleaded guilty today for their roles in a scheme to defraud Medicare and other health care insurers.  

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Brandon J. Fremin of the Middle District of Louisiana, 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 Field Office, and Special Agent in Charge Eric J. Rommal of the FBI’s New Orleans Field Office made the announcement. 

John Eastham Clark M.D., 66, of Baton Rouge, pleaded guilty on Feb. 13 to count one of an indictment charging him with conspiracy to commit health care fraud.  His sentencing has not been scheduled yet by U.S. District Judge Shelly D. Dick of the Middle District of Louisiana, who accepted his plea.  Charlene Anita Severio 56, of Walker, Louisiana, pleaded guilty today to one count of an indictment charging her with conspiracy to commit health care fraud and wire fraud and two counts of the indictment charging health care fraud.  Her sentencing has not been scheduled yet by Judge Dick, who accepted her plea.

“For nearly a decade, John Eastham Clark and Charlene Anita Severio submitted fraudulent claims to Medicare and other health insurers for payments they were not entitled to receive,” said Assistant Attorney General Benczkowski.  “These guilty pleas should serve as a warning to unscrupulous doctors and other medical professionals: the Criminal Division’s Medicare Fraud Strike Force and our law enforcement partners will aggressively investigate and prosecute illegal billing practices and other fraudulent schemes that steal taxpayer dollars and increase healthcare program costs for all Americans.”

“In defrauding the Medicare system, Dr. Clark violated a sacred oath taken by physicians but above all he violated the law,” said U.S. Attorney Fremin.  “Ms. Severio, an employee of Dr. Clark, submitted fraudulent claims to both Medicare and other health care insurers as part of the scheme.  We will continue to hold medical professionals accountable for abusing positions of trust in the community and for harming the financial integrity of our health care system.  I want to thank the Department of Justice’s Criminal Division, Fraud Section, the FBI, Health and Human Services - Office of Inspector General and the dedicated attorneys and staff from our office for their outstanding efforts in this case.”

“Today’s guilty pleas clearly illustrate that, along with our law enforcement partners, we will aggressively pursue criminal charges against bad actors in the Medicare program,” said HHS-OIG Special Agent in Charge Porter.  “Those intent on robbing patients with legitimate medical needs of access to taxpayer funds earmarked for their health care, will ultimately pay a heavy price.”    

“Agents of the Federal Bureau of Investigation remain dedicated to combating health care fraud and to doing our part in reducing the impact that opioids have on our nation,” said FBI Special Agent in Charge Rommal.  “This was a case that spanned multiple years and has resulted in numerous convictions.  It highlights the cooperation between the FBI and the Health and Human Services - Office of the Inspector General.”

Clark was a co-owner and the medical director of Louisiana Spine & Sports LLC, a pain management clinic located in Baton Rouge.  According to plea documents, the charge stems from Clark’s role in a scheme to submit fraudulent claims to Medicare and other health care insurers.  Specifically, as part of his guilty plea, Clark admitted that from approximately June 2005 through March 2015, he, along with his billing supervisor Severio, and others, conspired to submit fraudulent claims indicating that minor surgical procedures occurred on days subsequent to office visits, when in fact the office visits and procedures took place on the same day.  Clark admitted that this practice, commonly referred to as “unbundling,” was done to defraud health care insurers for non-reimbursable office visits.  Clark further admitted to falsifying, and directing Severio and others to falsify, records substantiating the fraudulent claims.  

Severio was a billing supervisor at Louisiana Spine & Sports, and worked for Clark.  According to admissions made as part of her guilty plea, from approximately June 2005 through March 2015, Severio conspired with Clark to submit fraudulent claims to Medicare and other health care insurers.  Specifically, Severio admitted that she knowingly and willfully submitted fraudulent claims indicating that minor surgical procedures performed by Clark occurred on days subsequent to office visits, when in fact the office visits and procedures took place on the same day.  Severio admitted that this practice was done to defraud health care insurers.

 In another case involving Louisiana Spine & Sports, on Nov. 20, 2018, Gray Wesley Barrow M.D., a co-owner of Louisiana Spine & Sports, pleaded guilty to a scheme to receive approximately $336,000 in illegal health care kickback payments.  Barrow is scheduled to be sentenced on March 1.  In addition, Christopher William Armstrong, a former physician’s assistant at Louisiana Spine & Sports, pleaded guilty on Nov. 27, 2018 for his role in a scheme to unlawfully distribute thousands of oxycodone pills.  Armstrong is scheduled to be sentenced on April 16.   

The case was investigated by HHS-OIG and the FBI.  Assistant Chief Dustin M. Davis and Trial Attorney Justin M. Woodard of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Elizabeth E. White of the Middle District of Louisiana are prosecuting the case.  

The Criminal Division’s Fraud Section leads the Medicare Fraud Strike Force.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion. 

BOSTON – A Whitinsville woman pleaded guilty today in federal court in Worcester to her role in a conspiracy to distribute the amphetamine Adderall.

Meghan Giacomuzzi, 36, pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute Adderall and six counts of distributing and dispensing Adderall. U.S. District Court Judge Timothy S. Hillman scheduled sentencing for May 14, 2019. Giacomuzzi was charged by Information in November 2018.

Between October 2016 and February 2018, Giacomuzzi conspired with others to distribute Adderall, an amphetamine, for uses other than a legitimate medical purpose and not in the usual course of medical practice. While working for Leslie Caraceni, M.D., at her medical practice in Whitinsville, Giacomuzzi wrote prescriptions for controlled substances, including Adderall, for patients who had not been examined or diagnosed by Caraceni, using prescription pads provided by Caraceni, and then sold the prescriptions to patients. Giacomuzzi would then deliver cash payments to Caraceni at her residence or leave cash in the medical office for Caraceni to collect, while payments made by debit or credit card were paid to a bank account controlled by Caraceni.

Caraceni was charged in November 2018 and has pleaded not guilty and is awaiting trial.

The charge of conspiracy to distribute, dispense, and possess with intent to distribute Adderall carries a sentence of up to 20 years in prison, at least three years of supervised release, and a fine of up to $1 million. The charge of distributing, dispensing, and possessing with the intent of distributing Adderall also carries a sentence of up to 20 years in prison, at least three years of supervised release, and a fine of up to $1 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

United States Attorney Andrew E. Lelling and Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Division, made the announcement today. Assistant U.S. Attorney Craig Estes of Lelling’s Narcotics and Money Laundering Unit is prosecuting the case.

St. Louis – St. Louis Metropolitan Police Officer Kenneth A. Grooms, II, 38, was charged today with one misdemeanor count of deprivation of rights in violation of Title 18, United States Code, Section 242.  According to the charging document, on or about May 5, 2018, Grooms willfully deprived “John Doe” of his constitutional right to be free from unreasonable seizure.  This crime carries a maximum possible sentence of one year in prison, a fine of up to $100,000, or both imprisonment and a fine.

The case is being investigated by the Federal Bureau of Investigation.  Assistant United States Attorneys Reginald Harris and Jennifer Winfield are handling the case for the United States Attorney’s Office.

Charges set forth in the Information are merely accusations and do not constitute proof of guilt.  Every defendant is presumed to be innocent unless and until proven guilty. 

BOSTON - A Chicopee man was sentenced today in federal court in Springfield for distributing heroin.

Steven Brown, 28, was sentenced by U.S. District Court Judge Mark G. Mastroianni to time served (three months) in prison and six years of supervised release. In October 2018, Brown pleaded guilty to one count of distribution and possession with intent to distribute heroin.

On June 30, 2016, Brown sold 300 bags of heroin to a cooperating witness. Brown has previously been convicted in state court of drug distribution offenses six times between 2008 and 2013, and he was facing state drug charges at the time of this offense.

United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Office; Colonel Kerry A. Gilpin, Superintendent of the Massachusetts State Police; Springfield Police Commissioner John Barbieri; and Holyoke Police Chief James M. Neiswanger made the announcement. Assistant U.S. Attorney Todd E. Newhouse of Lelling’s Springfield Branch Office prosecuted the case.

TEXARKANA, Texas – Two East Texas convicted felons have been sentenced to federal prison for violating the terms of their supervised release in the Eastern District of Texas, announced U.S. Attorney Joseph D. Brown today.

Johnny McElwrath, 39, of Jefferson, Texas, was sentenced to 33 months in federal prison on Mar. 16, 2015, to be followed by 3 years of supervised release for transportation of illegal aliens. As a condition of his supervised release, McElwrath was required to report all vehicles owned or operated, or in which he had an interested, to the probation office.  However, on Dec. 21, 2018, he was arrested while driving a 2007 Hummer registered in his name, which he had not reported to the probation officer. McElwrath admitted this violation before U.S. Magistrate Judge Caroline M. Craven on Feb. 8, 2019 and was sentenced to 16 months in federal prison as a result. 

                Meekesha Tarsha Mitchell, 42, of Texarkana, Texas, was sentenced to 21 months in federal prison on Oct. 7, 2015, to be followed by 3 years of supervised release for theft of government property. As a condition of her supervised release, Mitchell was required to participate in a program of testing and treatment for drug abuse, under the guidance and direction of the U.S. Probation Office, until such time as she was released from the program by the probation officer. However, on Jan. 28, 2019, Mitchell was unsuccessfully discharged from her substance abuse treatment program. Mitchell admitted this violation before Judge Craven on Feb. 8, 2019, and was sentenced to 6 months in federal prison as a result.

                These cases were investigated by the U.S. Probation Office and prosecuted by Assistant U.S. Attorney Jonathan R. Hornok.

SHERMAN, Texas – A 38-year-old Sherman man has been sentenced to federal prison for bank fraud in the Eastern District of Texas, announced U.S. Attorney Joseph D. Brown.

            Michael Shelley pleaded guilty on July 18, 2018, to bank fraud and was sentenced to 120 months in federal prison on Feb. 7, 2019, by U.S. District Judge Amos Mazzant.  Shelley was also ordered to pay restitution in the amount of $2,189,073 to Lone Star Agricultural Credit Association (LSAC).   

According to information presented in court, Shelley engaged in bank fraud while employed as a licensed loan officer at LSAC.  Shelley devised and executed a scheme to defraud LSAC of millions of dollars through loan manipulation. Without LSAC’s knowledge or authorization, Shelley fabricated loan documents, advanced funds to fictitious borrowers, and manipulated collateral and loan interest rates.  He made unauthorized fund transfers from fictitious borrowers to existing LSAC customers, all to the detriment of LSAC.  Shelley’s criminal conduct involved nearly $9 million in LSAC loans and funds. 

            At sentencing, counsel for the victim, LSAC, explained the expansive financial harm Shelley’s fraud caused to both LSAC and its borrower-members.  Due to Shelley’s position of authority within the bank, LSAC had to expend significant resources to unwind and uncover the full breadth and impact of his fraud.  According to LSAC, the impact of Shelley’s fraud will be felt for years to come.

            “Employee theft affects many businesses, and it can be devastating to a company,” said U.S. Attorney Joe Brown.  “Unfortunately, this man had access to a whole lot of money, and he took advantage of that, and took advantage of the bank.  It doesn’t matter whether it’s stolen with a gun or computer, it hurts just as bad to the victim.”

            This case was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Christopher A. Eason, with the assistance of Assistant U.S. Attorney Robert Austin Wells.

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