Sergey Ovsyannikov and Yevgeniy Timchenko, citizens of the Republic of Kazakhstan, pleaded guilty yesterday and today, respectively, in federal court in Brooklyn to conspiring to commit wire fraud and related charges, for their involvement in a widespread digital advertising fraud.  Ovsyannikov was arrested in October 2018 in Malaysia and extradited to the United States in March 2019.  Timchenko was arrested in November 2018 in Estonia and extradited to the United States in February 2019.  Both plea proceedings took place before United States Magistrate Judge Steven M. Gold.  When sentenced, Ovsyannikov faces up to 42 years in prison, and Timchenko faces up to 40 years in prison.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the guilty pleas.

Background on Digital Advertising

The internet is, in large part, freely available to users worldwide because it runs on digital advertising, where website owners display advertisements on their sites and are compensated by intermediaries representing businesses that advertise goods and services to  human customers.  In general, digital advertising revenue is based on how many users click, or view, the advertisements on those websites.  As alleged in court filings, the defendants in this case represented that they ran legitimate companies that delivered advertisements to human internet users, who accessed real internet webpages.  In fact, the defendants faked both the users and the webpages they programmed computers they controlled to load advertisements on fabricated webpages, via an automated program, and fraudulently obtained digital advertising revenue. 

The Botnet-Based Criminal Scheme (“3ve.2 Template A”)

Between December 2015 and October 2018, Ovsyannikov and Timchenko were involved in operating a purported advertising network and carried out a digital advertising fraud scheme, referred to in the advertising industry as “3ve.2 Template A.”  In this scheme, the defendants used a global “botnet”¾ a network of malware-infected computers operated without the true owner’s knowledge or consent to perpetrate their fraud.  The defendants developed an intricate infrastructure of command-and-control servers to direct and monitor the infected computers, and to detect whether a particular infected computer had been flagged by cybersecurity companies as being associated with fraud.  By using this infrastructure, the defendants accessed more than 1.7 million infected computers belonging to individuals and businesses in the United States and elsewhere, and used hidden browsers on those infected computers to download fabricated webpages and load advertisements onto those fabricated webpages.  Meanwhile, the owners of the infected computers were unaware that this process was running in the background on their computers.  As a result of this scheme, the defendants falsified billions of advertisement views and caused businesses to pay more than $29 million for advertisements that were never actually viewed by human internet users.    

The Defendants’ Roles

Ovsyannikov led the development of the 3ve.2 scheme, and was a principal and owner of the advertisement network used to carry out the scheme.  Ovsyannikov set out the infrastructure of the scheme in a spreadsheet titled “[Ad Network] Structure. Hosting and Domains.”  The spreadsheet listed many of the command-and-control servers and other servers involved in the scheme, including several designated as repositories of “spoof” webpages.  Ovsyannikov maintained lists of webpages to fabricate (or “spoof”) in his cloud storage account and on servers that he controlled, including more than 86,000 webpages associated with online publishers, including the webpages of thousands of businesses in the United States.  In communications with co-conspirators, Ovsyannikov explained how different aspects of the infrastructure worked together to perpetrate the fraud, such that a “bot” in the botnet would “set itself” to visit a “spoofed domain” and cause a falsified advertisement view.  Ovsyannikov directed proceeds of the fraud to bank accounts in Switzerland, among other locations.  As part of his guilty plea, Ovsyannikov will forfeit those Swiss bank accounts, whichcontain more than eight million dollars.         

Timchenko worked for Ovsyannikov and handled logistical and administrative aspects of the 3ve.2 scheme.  Timchenko assisted in creating the infrastructure of command-and-control servers and other servers that were instrumentalities of the scheme.  Timchenko deliberately chose certain U.S. service providers because they had the “coolest processors” and a “larger” cache (for temporary data storage) than competing providers.  Timchenko also researched webpages to fabricate, deliberately targeted webpages for businesses in the United States, and placed those webpages on a running list that both defendants kept that was titled “New companies for spoofing.” 

Separately, Ovsyannikov provided technical assistance to the operators of another digital advertising fraud scheme, referred to in the advertising industry as “Methbot.”  In the Methbot scheme, the perpetrators used computers housed in commercial datacenters, instead of in a botnet, to carry out the digital advertising fraud.  Ovsyannikov helped the Methbot operators program the datacenter computers to mimic human behavior, disguise the computers’ automated browsers, and evade fraud detection software.  The Methbot operators falsified billions of advertisement views and caused businesses to pay more than $7 million for advertisements that were never actually viewed by human internet users.

The Botnet Takedown

Following the arrest of Ovsyannikov by Malaysian authorities in October 2018, U.S. law enforcement authorities, in conjunction with various private sector companies, began the process of dismantling the criminal cyber infrastructure utilized in the botnet-based scheme, which involved computers infected with malicious software known “Kovter.”  The FBI executed seizure warrants to redirect the internet traffic going to 23 internet domains used to further the charged botnet-based scheme or otherwise used to further the Kovter botnet (an action known as “sinkholing”), in order to disrupt and dismantle the botnet.  The FBI also executed search warrants at 11 different U.S. server providers for 89 servers related to the charged botnet-based scheme or Kovter.  

In addition, as part of its investigation, the FBI discovered an additional cybercrime infrastructure committing digital advertising fraud through the use of datacenter servers located in Germany, and a botnet of computers in the United States infected with malicious software known in the cybersecurity community as “Boaxxe.”  The FBI executed seizure warrants to sinkhole eight domains used to further this scheme and thereby disrupt yet another botnet engaged in digital advertising fraud.

Finally, the United States, with the assistance of its foreign partners, executed seizure warrants for multiple international bank accounts in Switzerland and elsewhere that were associated with the schemes. 

For technical details on the malware and botnets referenced in this case, please see US-CERT Alert TA18-331A: https://www.us-cert.gov/ncas/alerts/TA18-331A

The government’s case is being prosecuted by the Office’s National Security and Cybercrime Section.  Assistant United States Attorneys Saritha Komatireddy, Michael T. Keilty, Alexander F. Mindlin and Karin K. Orenstein are in charge of the prosecution.

The Defendants:

SERGEY OVSYANNIKOV
Age:  30
Republic of Kazakhstan

YEVGENIY TIMCHENKO
Age:  31
Republic of Kazakhstan

E.D.N.Y. Docket No. 18-CR-633 (ERK)

ALBANY, NEW YORK – Marvin Danilo Aquino a/k/a Marvin Padilla, age 23, of Amsterdam, New York, was sentenced today to serve 25 months in prison for making a false statement in a passport application and aggravated identity theft.

The announcement was made by United States Attorney Grant C. Jaquith and Timothy Dumas, Special Agent in Charge of the New York Field Office of the United States Department of State’s Diplomatic Security Service.

As part of his guilty plea on April 19, 2019, Aquino admitted that in October 2017, he visited a U.S. Post Office in Gloversville, New York, and filled out an application for a U.S. passport, which he then submitted with a picture of himself.  On his application, however, Aquino listed the name, social security number, birthdate, and other identifying information of another person who had not authorized Aquino to file the application.  In support of the application, Aquino also submitted numerous documents containing the same third party’s identifying information.   

This case was investigated by the U.S. Department of State’s Diplomatic Security Service with assistance from the Social Security Administration Office of the Inspector General.  It was prosecuted by Assistant U.S. Attorney Joshua R. Rosenthal.

BINGHAMTON, NEW YORK - Andrew N. LaVigne, age 66, of Lansing, New York, was sentenced today in federal court in Binghamton to serve 87 months in prison for bankruptcy fraud, mail fraud, and money laundering, announced United States Attorney Grant C. Jaquith, James Hendricks, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI), and Jonathan D. Larsen, Special Agent in Charge of the Internal Revenue Service, Criminal Investigations (IRS-CI), New York Field Division.

Senior United States District Judge Thomas J. McAvoy also ordered LaVigne to pay over $3.6 million in restitution to his victims.

LaVigne, a Certified Public Accountant (“CPA”) who practiced in the Ithaca, New York area for more than 30 years, filed for personal bankruptcy in 2004.  At the time, he owed approximately $7.6 million to over 80 unsecured creditors following a failed scheme to use their money to purchase sports and entertainment memorabilia for resale.  During the course of LaVigne’s years‑long bankruptcy proceedings, he claimed that his only asset was his home. He paid back no money to his 80 investors.  In pleading guilty, LaVigne admitted that during his bankruptcy he used his CPA practice’s bank accounts to conceal between $3.5 and $9.5 million in assets from the United States Bankruptcy Court and the Office of the United States Trustee.  LaVigne laundered money by depositing funds unrelated to his CPA practice into his business accounts and then using that money for his own benefit and that of his family, including buying himself sports memorabilia and writing checks to himself totaling tens of thousands of dollars that were never disclosed in his bankruptcy proceeding.

In pleading guilty, LaVigne also admitted to defrauding an elderly client in a $4.6 million mail fraud scheme.  Between 2014 and 2016, LaVigne convinced the elderly victim to pay $3.6 million for shares of a company that LaVigne created, which LaVigne claimed would develop a piece of waterfront property on Pier Road in Ithaca.  After the victim bought 90% of the company, LaVigne obtained an additional $1 million from her, purportedly as a further investment in the company.  LaVigne did not use the $1 million to invest in the company, and he never developed the property.  Instead, he used the victim’s money for his own purposes, including writing checks to himself, paying for the construction of a house for a family member, and funding payroll for his CPA practice.  LaVigne also laundered payments he received from this scheme through his CPA practice accounts.

United States Attorney Grant C. Jaquith said, “Bankruptcy is intended to give honest debtors a fresh start.  Andrew LaVigne is not that honest debtor.  He abused the bankruptcy process for his own gain and attempted to leave his creditors with nothing while he hid and spent millions of dollars.  Mr. LaVigne’s crimes did not stop there – he lied to an elderly client and defrauded her  of millions of dollars that he spent on himself, his family, and his business.  Mr. LaVigne’s frauds cost his victims dearly, and I am grateful to our partners at the IRS, the FBI, and the Office of the United States Trustee for helping to bring him to justice.”

“The FBI takes our responsibility to investigate and pursue those who commit fraud for personal gain very seriously,” said James N. Hendricks, Special Agent in Charge of the Federal Bureau of Investigation's (FBI) Albany Field Office. “We will continue working with our law enforcement partners to hold accountable those who use illegal means and criminal behavior to take advantage of others.”

“IRS Criminal Investigation uses financial investigative expertise to pursue those individuals who engage in corruption as demonstrated in this case by Mr. LaVigne.” said Jonathan D. Larsen, IRS Special Agent in Charge of the New York Field Office, “Money laundering and fraud constitutes a serious threat to our communities and to the integrity of our financial system; today’s sentence is an example of how the FBI and the IRS work together to make a formidable team as we prosecute the offenders.” 

This case was investigated by the Internal Revenue Service, Criminal Investigation (IRS-CI) and the Federal Bureau of Investigation (FBI), following a referral from the Office of the United States Trustee for the Northern District of New York.  It was prosecuted by Assistant U.S. Attorneys Carina H. Schoenberger and Michael F. Perry.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse.  Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims.  For more information about Project Safe Childhood, please visit www.justice.gov/psc.

Tampa, Florida – United States Attorney Maria Chapa Lopez announces a significant health care fraud and opioid enforcement operation across the Middle District of Florida, involving charges against eight individuals for their alleged involvement in various schemes to defraud Medicare, Medicaid, and other federal health care benefit programs, and in various conspiracies to illicitly obtain and distribute oxycodone and other controlled substances. 

Among those charged in partnership with the Justice Department’s Medicare Fraud Strike Force are the following:

          United States v. Teresa Johnson

Teresa Johnson (53, Lecanto) is charged in a one-count Information with conspiracy to commit health care fraud. She faces a maximum penalty of 10 years in federal prison. According to the Information, from November 2016 through October 2018, Johnson owned and operated Tri-County Medical Billing and submitted false and fraudulent claims to Medicare, Medicaid, Tricare, and ChampVA, on behalf of a medical doctor who owned clinics in Crystal River, Spring Hill, and Celebration, Florida. The case is being investigated by the Health and Human Services - Office of Inspector General (HHS-OIG), the FBI, the Department of Defense - Office of Inspector General (DoD-OIG), the Department of Veterans’ Affairs - Office of Inspector General (VA-OIG), and the Florida Office of Attorney General’s Medicaid Fraud Control Unit (MFCU). The case will be prosecuted by Assistant U.S. Attorney Kelley Howard-Allen.

          United States v. Hong Truong

Hong Truong (54, Dunedin) is charged in a 16-count indictment with conspiracy to unlawfully distribute and dispense Schedule II controlled substances, unlawful distribution and dispensing of Schedule II controlled substances, and using a place for unlawful drug distribution of the Schedule II controlled substances oxycodone 30 mg and hydromorphone 8mg in return for cash. Truong faces a maximum penalty of 20 years in federal prison on each of the counts. According to the indictment, Truong is a licensed pharmacist who owned and operated HP Pharmacy in Pinellas Park. From May 2015 through August 2016, Truong used her pharmacy to distribute and dispense Schedule II controlled substance prescriptions outside the scope of usual professional practice and for no legitimate medical purpose. This case was investigated by the Drug Enforcement Administration and is being prosecuted by Assistant U.S. Attorneys Kelley Howard-Allen and Greg Pizzo.

          United States v. Jessica Evans

Jessica Evans (34, St. Petersburg) is charged by Information with conspiracy to unlawfully distribute and dispense the Schedule II controlled substances oxycodone, methadone, and hydromorphone using forged and fraudulent prescriptions. Evans, who worked as a pharmacy technician at HP Pharmacy, faces a maximum penalty of 20 years in federal prison. This case was investigated by the DEA and is being prosecuted by Assistant U.S. Attorneys Kelley Howard-Allen and Greg Pizzo.

          United States v. Lucretia Mullan

Lucretia Mullan (34, St. Petersburg) is charged by Information with conspiracy to unlawfully distribute and dispense the Schedule II controlled substances oxycodone, methadone, and hydromorphone using forged and fraudulent prescriptions. She faces a maximum penalty of 20 years in federal prison. Mullan was employed as a medical assistant at a pain management clinic where she generated the fraudulent opiate prescriptions. This case was investigated by the DEA and is being prosecuted by Assistant U.S. Attorneys Kelley Howard-Allen and Greg Pizzo.

          United States v. Robin Lloyd

Robin Lloyd (37, St. Petersburg) is charged by Information with conspiracy to unlawfully distribute and dispense the Schedule II controlled substances oxycodone, methadone, and hydromorphone using forged and fraudulent prescriptions. She faces a maximum penalty of 20 years in federal prison. Lloyd was employed as a medical assistant at a pain management clinic where she generated the fraudulent opiate prescriptions. This case was investigated by the DEA and is being prosecuted by Assistant U.S. Attorneys Kelley Howard-Allen and Greg Pizzo.

          United States v. Patrice Jackson

Patrice Jackson (37, Bradenton) is charged by Information with conspiracy to unlawfully distribute the Schedule II controlled substances oxycodone, methadone, and hydromorphone using forged and fraudulent prescriptions. Shen faces a maximum penalty of 20 years in federal prison. Jackson obtained the fraudulent opiate prescriptions from Mullan and Lloyd and then obtained the Schedule II controlled substances from Truong and Evans at HP Pharmacy for distribution. This case was investigated by the DEA and is being prosecuted by Assistant U.S. Attorneys Kelley Howard-Allen and Greg Pizzo.

          United States v. Marcus Anderson

Marcus Anderson (34, St. Petersburg) is charged in a 13-count indictment with health care fraud and aggravated identity theft for stealing rendering providers’ identities to submit more than $1.2 million in false and fraudulent claims to Medicaid. He faces a maximum penalty of 10 years in federal prison for each of the seven health care fraud counts and a consecutive two years in prison for the six aggravated identity counts. The case is being investigated by HHS-OIG and the Florida Office of Attorney General/MFCU. This case will be prosecuted by Assistant U.S. Attorney Kristen A. Fiore.

An indictment and information are merely formal charges that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.

PITTSBURGH, Pa. - A resident of Plum Borough, PA, pleaded guilty in federal court today to charges involving heroin, fentanyl, and cocaine trafficking, United States Attorney Scott W. Brady announced today.

Brandon Winters, age 43, pleaded guilty before Senior United States District Judge Nora Barry Fischer to the two-count Indictment charging him at Count One with conspiring to possess with intent to distribute and to distribute one kilogram or more of heroin and 400 grams or more of fentanyl; and at Count Two, with possessing with intent to distribute 500 grams or more of cocaine.

In connection with the guilty plea, the Court was advised that on January 30, 2019, investigators with the Federal Bureau of Investigation and Pennsylvania State Police Drug Law Enforcement Division executed a search warrant at an apartment located in Pittsburgh, which was utilized by Winters and his alleged co-conspirators, Eduard Rijo and Erick Martinez. Upon entry into the apartment, case agents located Winters, Rijo, and Martinez, approximately 1,500 "bricks" (the equivalent of roughly 75,000 individual dosage units) containing mixtures of heroin and fentanyl, and more than 500 grams of cocaine. Additionally, case agents seized over $250,000 in U.S. Currency, which was found in and around Mr. Winters and his alleged co-conspirators.

Judge Fischer scheduled sentencing for Feb. 6, 2020 at 9:00 a.m. The law provides for a total sentence of not less than 10 years up to life in prison, a fine not to exceed $10,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.

Pending sentencing, the Court revoked Winters’s bond and remanded him to the custody of the United States Marshal.

Assistant United States Attorneys Jerome A. Moschetta and Tonya Sulia Goodman are prosecuting this case on behalf of the government.

The Federal Bureau of Investigation and the Pennsylvania State Police conducted the investigation that led to the prosecution of Winters.

Spokane – William D. Hyslop, United States Attorney for the Eastern District of Washington, announced that Randy Coy James Holmes, age 22, of Moses Lake, Washington, was sentenced today after having pleaded guilty on May 9, 2019, to being a felon in possession of a firearm. United States District Judge Salvador Mendoza, Jr., sentenced Holmes to a 37-month term of imprisonment, to be followed by a 3-year term of court supervision after he is released from federal prison.

According to information disclosed during court proceedings, a Grant County Sheriff’s Office deputy initiated a traffic stop on a vehicle with four occupants in Moses Lake, Washington. During the encounter, the deputy seized a stolen firearm from the vehicle’s rear passenger compartment and in close proximity to Holmes, a member of the Little Valley Locos street gang. Holmes is a previously convicted felon and is prohibited from possessing firearms. The firearm was submitted to the Washington State Patrol Crime Laboratory, which determined it contained a latent print belonging to Holmes.

United States Attorney Hyslop said, “The United States Attorney’s Office for the Eastern District of Washington is committed to prosecuting individuals who unlawfully possess firearms. Such offenses are serious and just punishment will be pursued against those individuals who violate the firearms laws. I commend the ATF, Grant County Sheriff’s Office and Washington State Patrol Crime Laboratory for their commitment to this successful prosecution.”

This case was prosecuted under the Project Safe Neighborhoods (PSN) program. PSN is a federal, state, and local law enforcement collaboration to identify, investigate, and prosecute individuals responsible for violent crimes in our neighborhoods. The U.S. Attorney’s Office is partnering with federal, state, local, and tribal law enforcement to specifically identify the criminals responsible for violent crime in the Eastern District of Washington and pursue criminal prosecution.

This case was investigated by the Spokane Regional Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”), the Grant County Sheriff’s Office, and the Washington State Patrol Crime Laboratory. This case was prosecuted by Patrick J. Cashman, an Assistant United States Attorney for the Eastern District of Washington.

HOUSTON – A former Harris County deputy constable and her husband have been charged with conspiring to possess heroin with the intent to distribute it as well as attempting to launder drug proceeds, announced U.S. Attorney Ryan K. Patrick. 

A Houston grand jury returned the six-count indictment Sept. 18 against Betty Jean Molina, 56, and her husband Henry Molina, 59, both of Houston. They were taken into custody yesterday and are expected to make their initial appearances today before U.S. Magistrate Judge Christina A. Bryan at 10 a.m.

At the time of the offense, Jean Molina was a deputy constable with Harris County Precinct 5 Constable’s Office.

She and her husband are charged for their involvement in the laundering of what they believed was $500,000 in drug proceeds over a two-month-period.

The couple is charged with one count of conspiracy and another count of possession with the intent to distribute heroin for which they face a minimum of 10 years and up to life in prison as well as a possible $10 million fine. If convicted of any of the four counts of money laundering, they also face a potential sentence of 20 years of federal imprisonment. Those counts also carry up to a $500,000 fine or twice the value of the property involved in the transaction.

The FBI conducted the investigation with the assistance of Harris County Constable Precinct 5 and the FBI Houston Law Enforcement and Border Corruption Task Force, which includes the Houston Police Department’s Internal Affairs Proactive Unit and the Texas Department of Public Safety.  

Assistant U.S. Attorneys Arthur R. Jones and Alamdar Hamdani are prosecuting the case.   

An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.

Columbia, South Carolina --- United States Attorney Sherri A. Lydon announced today that Nye’s Pharmacy, of Conway, has agreed to pay the United States $185,000 to resolve allegations that it failed to abide by recordkeeping requirements of the Controlled Substances Act and filled prescriptions without confirming that they served a legitimate medical purpose.  The settlement also requires Nye’s to comply with heightened reporting requirements for a two year period.       

“Pharmacies have a duty to ensure that they track and dispense controlled substances in compliance with the law,” said U.S. Attorney Lydon.  “Doctors and pharmacists are uniquely positioned to assist in preventing the abuse and diversion of controlled substances.  Adhering to the basic rules of recordkeeping and prescription review is essential to helping fight the opioid epidemic.”  

This matter was investigated by Dawn Bauer and Adam Roberson of the Drug Enforcement Administration and Assistant United States Attorneys Tina Cundari and James Leventis of the Columbia office.

The claims resolved by this settlement are allegations only.  Nye’s does not admit wrongdoing or liability. 

#####

Two doctors from Northeast Ohio and two drug company salesmen were indicted in federal court for their roles in a kickback conspiracy in which the doctors allegedly received money and other things of value in exchange for writing prescriptions of Nuedexta for patients that did not have the condition.

Named in the 83-count indictment are: Deepak Raheja, 63, of Hudson; Gregory Hayslette, 43, of Aurora; Frank Mazzucco, 41, of Dublin, and Bhupinder Sawhny, 70, of Gates Mills. All four are charged with conspiracy to solicit, receive, offer and pay health care kickbacks.

According to the indictment:

Raheja is a medical doctor who specialized in psychiatry and neurology whose primary practice location was 2307 West 14^th Street in Cleveland. Sawhny is a medical doctor who specialized in neurosurgery whose primary practice location was 6731 Ridge Road in Parma.

Hayslette worked as a pharmaceutical sales representative for Avanir Pharmaceuticals, Inc. from June 2015 through September 2016. He was responsible for marketing Nuedexta, and his territory included Northern Ohio. Mazzucco was the regional business manager and supervised Hayslette.

Avanir manufactured Nuedexta, a drug approved by the FDA solely to treat pseudobulbar affect (PBA). PBA is a condition characterized by involuntary, sudden and frequent episodes of uncontrollable laughing and crying, according to the indictment.

Avanir promoted Nuedexta through a speaker’s bureau, in which Avanir representatives engaged doctors to speak about and promote Nuedexta to other medical professionals. Typical speaking engagements involved dinner at a high-end restaurant in which the doctor made a presentation with a slide deck provided by Avanir. A company sales representative was responsible for inviting attendees and attending the presentation.

Raheja joined Avanir’s speaker’s bureau in February 2011. He gave approximately 211 speaking presentations at various restaurants and doctor’s offices between October 2011 and April 2016. Raheja received approximately $1,500 for each of these purported presentations.

Raheja received approximately $331,550 from Avanir between October 2011 and April 2016. During this time, Raheja wrote approximately 10,088 Nuedexta prescriptions – the highest in the country, according to the indictment.

As part of the conspiracy, Hayslette and Mazzucco incentivized physicians to write Nuedexta prescriptions and thereby increase compensation to themselves. This included:

Hayslette and Mazzucco arranged speaker’s bureau programs, many with little to no educational value, for Raheja, Sawhny and other medical professionals relating to Nuedexta.

Hayslette and Mazzucco facilitated the payment of honoraria and other expenses to Raheja.

Hayslette facilitated the submission of false and fictitious sign-in sheets from speaking engagements to justify the event and maximize payments and other benefits to Raheja and Sawhny.

Hayslette facilitated the promotion of non-FDA-approved uses and dosages of Nuedexta through the speaker’s bureau program and the distribution of literature to physicians.

Hayslette offered free firearms training, office equipment and other things of value to Sawhny. 

Hayslette provided coffee, breakfast, lunch and other food and beverage to Raheja, Sawhny and their office staff, usually with little to no substantive discussion about Nuedexta.

Hayslette accessed protected patient health information without authorization, and facilitated the submission of false diagnoses of PBA on prior authorizations to Medicaid Managed Care Organizations.

It was further part of the conspiracy that Raheja and Sawhny took steps in return for things of value, such as:

Raheja and Sawhny wrote more Nuedexta prescriptions and caused the submission of billings to Medicare and Medicaid for Nuedexta prescriptions for patients that did not have PBA.

Raheja and Sawhny also submitted and caused the submission of materially false and fictitious prior authorizations to Medicaid MCOs that reflected diagnoses of PBA for patients that did not actually have PBA.

Raheja falsely diagnosed patients with PBA, and recorded and caused the recording of false symptoms in patient records to support a diagnosis of PBA. 

Sawhny also allegedly permitted unauthorized access to protected patient health information. 

“We all trust our doctors to make decisions based on what is best for the patient, not based on which sales representative is paying them money on the side and springing for steak dinners,” U.S. Attorney Justin Herdman said. “Doctors and the pharmaceutical sales reps who don’t follow the rules will be held accountable for their actions.”

“These doctors will now answer to a court of law for financially benefitting from lucrative speaking engagements and writing questionable prescriptions for one medication,” FBI Special Agent in Charge Eric B. Smith said. “The FBI will continue collaborative efforts to root out healthcare fraud and hold those responsible accountable for their fraudulent, unethical behavior."

“Kickbacks are to ethics like a magnet to a compass — you lose your direction,” Ohio Attorney General Dave Yost said. “Imagine trusting your doctor to do what’s right for your health, and finding out he’s instead doing what’s right for his wallet. This is much more than a financial crime.”

If anyone believes they may have been a victim in this case, they are encouraged to call the FBI at 216-622-6963.

If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation.  In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.

The FBI, Health and Human Services – Office of Inspector General and the Ohio Attorney General’s Medicaid Fraud Control Unit investigated this case. Assistant U.S. Attorneys Michael L. Collyer and Megan R. Miller are prosecuting the case.

An indictment is only a charge and is not evidence of guilt.  A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.

            DAYTON – Today the government has unsealed charges against 19 individuals in an alleged narcotics conspiracy. Arrests were made this morning.

The briefing will be held:

TODAY: THURSDAY, SEPTEMBER 26, 2019

WHEN:           1:30 P.M.

WHERE:         Walter H. Rice Federal Building & U.S. Courthouse

                        Front Steps

                        200 West 2^nd Street

                        Dayton, Ohio 45402

WHO:             U.S. Attorney Benjamin C. Glassman

                        Mauricio Jimenez, assistant special agent in charge, DEA

ID and media credentials will be required.

#  #  #

PROVIDENCE – Paul J. Stabile, 39, of Cranston, who used an online persona of “Cindi Mennillo,” a 16-year-old girl from Newport, to persuade numerous young boys between the ages of 13-15 to engage in explicit sexual activity in live stream videos over Facebook Messenger and Skype, was sentenced today to 151 months in federal prison.

The investigation that led to identifying Stabile as a person directing young teenage boys to participate in sexually explicit live-stream videos began in December 2017, when the mother of a 14 year-old boy in Nevada reported to the FBI that her son was the victim of an online enticement. The investigation uncovered chats between Stabile, pretending to be 16 year-old “Cindi Mennillo,” and the minor victim.  During some of the conversations, Stabile directed the young teenager to send back live video streams of himself participating in sexually explicit acts.  To deceive the minor victim, Stabile falsely claimed technical difficulties were preventing “Cindi” from reciprocating with live video. Instead Stabile sent the young teenager images, both pornographic and non-pornographic, of an athletic young female purported to be “Cindi.”

On November 20, 2018, a federal court-authorized search of Stabile’s residence resulted in the seizure of several computers and other digital media devices and the arrest of Stabile. Forensic audits of the devices resulted in the discovery of hundreds of images and videos of child pornography, including videos of dozens of young teenage boys performing a sex act in a similar manner to the Nevada-based minor victim.  Also found were the images sent by “Cindi” to the minor victim in Nevada.

Stabile pleaded guilty on June 12, 2019, to inducement of a minor to engage in illicit sexual activity and possession of child pornography. At sentencing today, U.S. District Court Chief Judge William E. Smith sentenced Stabile to 151 months in federal prison to be followed by lifetime supervised release.

Stabile’s sentence is announced by United States Attorney Aaron L. Weisman and Special Agent in Charge of the FBI Boston Division Joseph R. Bonavolonta.

The case was prosecuted by Assistant U.S. Attorney John P. McAdams.     

The matter was investigated by the FBI, with assistance from members of the Rhode Island State Police Internet Crimes Against Children Task Force, Warwick and Cranston Police, and the Washoe County, Nevada Sherriff’s Department.

###

CHARLOTTE, N.C. – Brady Raymond Frick, Jr., 39, and Timothy Ray Canon, Jr., 27, both of Charlotte, were sentenced to prison today by U.S. District Judge Robert J. Conrad, Jr. for executing a bank fraud scheme involving stolen mail, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.  Frick was sentenced to 61 months in prison for conspiracy to commit bank fraud, bank fraud, and aggravated identity theft. Canon was sentenced to a year and a day in prison for conspiracy to commit bank fraud.  Both Frick and Canon were also ordered to serve terms of supervised release and to pay $81,322.14 in restitution.

David M. McGinnis, Inspector in Charge of the Charlotte Division of the U.S. Postal Inspection Service, joins the U.S. Attorney’s Office in making today’s announcement. 

According to filed court documents and today’s sentencing hearing, from April 2017 to November 2017, Frick and Cannon carried out a bank fraud scheme using stolen mail to defraud financial institutions.  Court records show that the co-conspirators obtained the stolen mail by targeting high-end neighborhoods in the Charlotte area.  In order to avoid detection, Frick rented luxury vehicles to drive around the targeted neighborhoods, while Canon collected the mail. As part of the criminal scheme, Frick and Canon stole mail that contained the victims’ bank checks, credit card convenience checks, credit cards, and other bank account information, and used the information to steal money from the victims and to make unauthorized transactions at the expense of federally-insured financial institutions. 

In addition to Frick’s 61-month sentence, Judge Conrad also imposed an additional two years in prison for Frick’s supervised release violation related to a 2009 conviction for theft of mail and possession of a firearm by a felon.

In making today’s announcement, U.S. Attorney Murray thanked the USPIS for leading the investigation, and commended the Charlotte Mecklenburg Police Department for their invaluable assistance.  This case is the result of the Charlotte Financial Crimes Task Force (CFCTF), which was formed in 2016 by the U.S. Postal Inspection Service and comprises over 25 local, state and federal law enforcement agencies located in the Western District of North Carolina. The goal of the task force is to focus on the identification and development of financial fraud investigations in the Charlotte area. Based on crime trends in the area, the task force began to focus its efforts on violent offenders with lengthy criminal histories who are committing fraud.  Assistant United States Attorney Caryn Finley of the U.S. Attorney’s Office in Charlotte, prosecuted the case.

PENSACOLA, FLORIDA – Five individuals were arrested yesterday on a 44-count federal indictment
charging violations of the dogfighting prohibitions of the federal Animal Welfare Act, and
conspiracy to commit those violations. The arrests were announced by U.S. Attorney Lawrence Keefe
of the Northern District of Florida and Assistant Attorney General Jeffrey Bossert Clark for the
U.S. Department of Justice Environment and Natural Resources Division.

Shane Patrick Sprague, 35, of Pensacola, Florida, Derek Jedidiah Golson, aka Derek Jedidiah Murray,
38, of Pensacola, Florida, Haley Cook Murph, 24, of Milton, Florida, David Lee Moser, 36, of
Waynesboro, Tennessee, and James “Tommy” Peek, 67, of Milton, Florida were indicted in the case
involving C Wood Kennels.

The indictment alleges that defendants Sprague and Golson operated C Wood Kennels, a dogfighting
operation that arranged dogfights, allowed fighting dogs to attack “bait” animals, and trafficked
in fighting dogs with defendant Moser and others outside of Florida, including through an
underground dogfighting website. The indictment further alleges that defendant Peek acted as a
source to supply fighting dogs to C Wood Kennels.

According to the indictment, defendant Murph’s role was that of a makeshift “veterinarian” for C
Wood Kennels. Although Murph at no time possessed a veterinary license, she offered to and did
perform veterinary and surgical procedures on fighting dogs so the kennel could avoid the scrutiny
of a licensed veterinarian. The defendant also possessed veterinary equipment used to treat injured
fighting dogs, including skin staplers, sutures, intravenous bags and lines, scalpels,
and injectable animal steroids.

“Dogfighting is a blight on humanity, one that has no place in the Northern District of Florida or
anywhere else,” said U.S. Attorney Keefe. “We will continue to work with federal and local law
enforcement agencies to root out this barbaric blood sport, in Florida and beyond.”

“As this case demonstrates, we are aggressively prosecuting dogfighters and those who support their
inhumane criminal enterprises – including unscrupulous veterinarians or veterinary poseurs,” said
Assistant Attorney General Jeffrey Bossert Clark of the Justice Department’s Environment and
Natural Resources Division. “We thank our federal and local law enforcement partners who made this
operation possible.”

“The provisions of the Animal Welfare Act were designed to protect animals from being used in
illegal fighting ventures, which often entail other forms of criminal activity involving drugs,
firearms, and gambling,” said Special Agent in Charge Bethanne M. Dinkins of the U.S. Department of
Agriculture-Office of Inspector General. “Animal fighting is an investigative priority for
USDA-OIG, and together with the Department of Justice, we will work with our law enforcement
partners to investigate and assist in the criminal prosecution of those who participate in animal
fighting ventures.”

The federal Animal Welfare Act makes it a felony to sponsor or exhibit an animal in an animal
fighting venture and to possess, train, sell, purchase, transport, deliver, or receive an animal
for purposes of having the animal participate in an animal fighting venture.

This matter continues to be investigated by the U.S. Department of Agriculture, Office of the
Inspector General. Assistant United States Attorney Ryan Love and Department of Justice Trial
Attorney Ethan Eddy are prosecuting the case. If convicted, each defendant faces up to five years
in prison and a $250,000 fine per count.

An indictment is merely an allegation by a grand jury that a defendant has committed a violation of
federal criminal law and is not evidence of guilt. All defendants are presumed innocent and
entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a
reasonable doubt at trial.

The United States Attorney’s Office for the Northern District of Florida is one of 94 offices that
serve as the nation’s principal litigators under the direction of the Attorney General. To access
public court documents online, please visit the U.S. District Court for the Northern District of
Florida website.  For more information about the U.S. Attorney’s Office, Northern District of
Florida, visit http://www.justice.gov/usao/fln/index.html.

United States Attorney Trent Shores announced that a jury found Evan Jamon Woodard, 34, of Tulsa, guilty on Wednesday of multiple crimes, including intent to distribute cocaine, marijuana, and heroin, while carrying a firearm.

"I thank the jury for their service.  Justice was done today. A gun-toting drug dealer who had seven prior felony convictions is off the streets and headed to federal prison," stated U.S. Attorney Trent Shores.  "Guns and drugs are a dangerous combination that often lead to violence.  That is why our Project Safe Neighborhoods initiative focuses on these types of offenses.  I commend Assistant U.S. Attorneys Victor Regal and Edward Snow for successfully prosecuting this case, and the ATF and TPD for their thorough investigation. This guilty verdict is a direct reflection of the excellent collaborative law enforcement partnerships we have in northern Oklahoma."

Ultimately, the jury found Woodard guilty of 7 total felony charges. U.S. District Judge Gregory K. Frizzell presided over the trial and will sentence Woodward on December 30, 2019.  Woodard faces a maximum penalty of 10 years in prison and a $250,000 fine for the felon in possession of firearm and ammunition charge; a maximum penalty of 20 years in prison and a $1,000,000 fine for the possession with intent to distribute cocaine and heroin charges; a maximum penalty of 5 years in prison and a $250,000 fine for the possession with intent to distribute marijuana charges; and a maximum penalty of life in prison and a $250,000 fine for possessing a firearm in furtherance of drug trafficking crimes.

Project Safe Neighborhoods is the nationwide federal initiative to disrupt gun violence strategically and comprehensively, using all available enforcement and prosecutive tools.  The initiative involves a partnership of federal, state, and local authorities, uniting their efforts and leveraging existing and new resources at all levels.  Each United States Attorney’s Office will create a specialized unit that tailors its approach to the unique needs of its own district, and targets the most significant gun crime problems within that district to maximize the impact of the initiative and help ensure the safety of the community.

Woodard’s arrest and conviction were the result of a coordinated effort involving the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Tulsa Police Department, and Assistant U.S. Attorneys Victor Regal and Edward Snow.

United States Attorney Ron Parsons announced that a Ft. Thompson, South Dakota, man convicted of Conspiracy to Distribute a Controlled Substance was sentenced on September 25, 2019, by U.S. District Judge Roberto A. Lange.

Michael George Fallis, age 41, was sentenced to 72 months in federal prison, 4 years of supervised release, a $1,000 fine, and a special assessment to the Federal Crime Victims Fund in the amount of $100.

Fallis was indicted by a federal grand jury on April 9, 2019.  He pled guilty on May 30, 2019.

The conviction stemmed from an drug conspiracy that began at a time unknown, but no later than December 1, 2015, and continuing to November 14, 2018, where Fallis knowingly and intentionally conspired with others to distribute and possess with the intent to distribute over 500 grams of methamphetamine, a Schedule II controlled substance, on the Crow Creek and Lower Brule reservations in South Dakota. Fallis was a dealer for Frank “Tank” Adams, who was convicted of conspiracy to distribute a controlled substance at a federal jury trial in August.  Fallis allowed Adams to deal methamphetamine out his home.  A federal search warrant conducted at Fallis home recovered meth, baggies, scales and other drug paraphernalia items.

This case was investigated by the Northern Plains Safe Trails Drug Enforcement Task Force, the Federal Bureau of Investigation, the Bureau of Indian Affairs, Crow Creek Agency, the Bureau of Indian Affairs, Lower Brule Agency, the South Dakota Highway Patrol, and the Pierre Police Department. Assistant U.S. Attorney Meghan N. Dilges.

Fallis was immediately turned over to the custody of the U.S. Marshals Service.

# # #

Twenty-eight Arrests Made in Coordinated Takedown by Federal and State Law Enforcement

TRENTON, N.J. – Federal criminal charges have been filed against 31 individuals for their roles as members, associates, and suppliers of a drug-trafficking conspiracy that distributed cocaine, crack cocaine, and heroin in the Burlington County, New Jersey, area, U.S. Attorney Craig Carpenito announced today.

Twenty-eight defendants were arrested today, one was already in state custody, and two remain at large. Those arrested today are scheduled to have their initial appearances this afternoon before U.S. Magistrate Judge Douglas E. Arpert in Trenton federal court. (See chart below.)

The first complaint charges 20 defendants in two overlapping drug conspiracies involving the distribution of cocaine and crack cocaine in the Burlington County area. This organization is allegedly operated by Herbert Mays of Willingboro, New Jersey.

The second complaint charges 12 defendants with three interrelated drug conspiracies involving the distribution of cocaine, crack cocaine, and heroin. Talib Conway of Philadelphia is described in the complaint as a leading member of this organization. One defendant, Teron Huggins, is charged in both complaints.

“The defendants charged in this case were responsible for moving large quantities of dangerous drugs through the streets of Burlington County and elsewhere,” U.S. Attorney Carpenito said. “Taking this number of people off the street required a massive and coordinated effort by our office and other federal and state law enforcement organizations. These arrests should go a long way toward making our streets safer.”

“The success of today’s operation is largely attributed to the close working relationship between federal, state, and local law enforcement,” FBI Special Agent-in-Charge Gregory W. Ehrie, Newark, said. “This collaborative effort to address violent, drug traffickers within our local communities is just one example of how highly the FBI values its partners. To them, I would like to say ‘thank you’ for trusting us, lending their support, and playing a critical role making our community safer. To the criminal element that escaped arrest this time around – know that we aren't finished.”

“Today's arrests are a testament to ATF's commitment to stand with our local, state, and federal partners to expend every resource available to make our communities safer,” ATF Special Agent in Charge Charlie J. Patterson said. “Arresting criminals that contribute to the violence in our communities will continue to be ATF's top priority.”   

According to the documents filed in this case and statements made in court:

Between July 2019 and September 2019, the defendants and others engaged in a narcotics conspiracy that operated primarily throughout Burlington County – including Willingboro, Burlington City, Burlington Township, Bordentown Township, Edgewater Park, Pemberton and Mount Laurel – and which sought to profit from the distribution of cocaine, crack cocaine, and heroin. Through the interception of telephone calls and text messages pursuant to court-authorized wiretap orders, and other investigative techniques, law enforcement learned that defendants obtained regular supplies of cocaine from conspirators in the Philadelphia area, then redistributed that cocaine, portions of which defendants converted into crack cocaine, to distributors, sub-dealers, and end-users throughout Burlington County and elsewhere. During the wiretap portion of the investigation, law enforcement intercepted numerous communications among the conspirators discussing cocaine, crack cocaine, and heroin quality and availability, pricing, packaging, quantity, and customer satisfaction.

The counts of conspiracy to distribute at least five kilos of cocaine carry a maximum penalty of life in prison and a fine of $1 million. The counts of conspiracy to distribute 280 grams or more of crack cocaine carry a maximum potential penalty of life in prison, and a maximum fine of $10 million. The counts of conspiracy to distribute 100 grams or more of heroin carry a maximum penalty of 40 years in prison and a fine of $5 million. The counts of conspiracy to distribute 28 grams or more of crack cocaine carry a maximum potential penalty of 40 years in prison and a fine of $5 million.

U.S. Attorney Carpenito credited special agents of the FBI, Newark Division, Trenton Resident Agency, under the direction of Special Agent in Charge Gregory W. Ehrie; special agents of ATF, under the direction of Special Agent in Charge Charlie J. Patterson; detectives of the Burlington County Prosecutor’s Office, under the direction of Burlington County Prosecutor Scott Coffina; officers of the Burlington Township Police Department, under the direction of Director of Public Safety Bruce Painter; officers of the Willingboro Police Department, under the direction of Director of Public Safety Kinamo Lomon; officers of the Burlington City Police Department, under the direction of Chief of Police John Fine; officers of the Florence Police Department, under the direction of Chief of Police Brian Boldizar; officers of the Bordentown Township Police Department, under the direction of Chief of Police Brian Pesche; officers of the Edgewater Park Police Department, under the direction of Chief of Police Robert Hess; officers of the Mount Laurel Police Department, under the direction of Chief of Police Stephen Reidener; officers of the Ewing Police Department, under the direction of Chief of Police John Stemler; officers of the Westampton Police Department, under the direction of Chief of Police Stephen Ent; officers of the Trenton Police Department, under the direction of Director Sheilah Coley, with the investigation leading to the charges.

The government is represented by Assistant U.S. Attorneys Martha K. Nye and Ray Mateo of the U.S. Attorney’s Office’s Criminal Division in Trenton.

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

*denotes at large

SAN JUAN, Puerto Rico – On September 25, 2019, a federal grand jury in the District of Puerto Rico returned an indictment against 50 defendants charged with conspiracy to possess with intent to distribute, and distribution of, controlled substances, announced Rosa Emilia Rodríguez-Vélez, United States Attorney for the District of Puerto Rico. Homeland Security Investigations (HSI), the Drug Enforcement Administration (DEA), and the Puerto Rico Police Department (PRPD), Ponce Strike Force, were in charge of the investigation, with the collaboration of the US Marshals Service.

The indictment alleges that since the year 2013, the drug trafficking organization distributed heroin, crack, cocaine, and marihuana, within 1,000 feet of the real property comprising the José N. Gándara, and the Hogares de Portugués Public Housing Projects located in the Municipality of Ponce, and other areas in the southern part of Puerto Rico, all for financial gain and profit.

The 50 defendants acted in different roles in order to further the goals of their organization, to wit: leaders, drug point owners, enforcers, runners, and sellers. Sixteen defendants are also charged with possession of firearms in furtherance of a drug trafficking crime.

As part of the conspiracy, the members of the drug trafficking gang conducted meetings to discuss the activities of the organization. The defendants had access to different vehicles in order to transport money, narcotics, and firearms. The leaders had final approval authority as to disciplinary action to be imposed upon residents of the José N. Gándara Public Housing Project; the Hogares de Portugués Public Housing Project, and/or the members of the conspiracy should they disobey the rules imposed by the drug trafficking organization.

The drug distribution points were located at the staircases of the public housing project buildings, among other locations. The gates of the buildings would be locked to prevent law enforcement personnel’s access to the drug points, thereby avoiding detection. The gang also used homemade buckets, similar to a “weapon unloading station,” to test fire their firearms while concealing the sound of the shot. These buckets were located within different areas in the José N. Gándara Public Housing Project. Members of the conspiracy would create labels to identify controlled substances as “prescribed” in order to mislead law enforcement agents into believing that the controlled substance was authorized to treat medical conditions.

The defendants indicted are: Cristopher Román-Medina, a.k.a. “Keke”; Victor Torres Galindo, a.k.a. “Manuel Silva”; Hommy Santiago-Rodríguez, a.k.a. “Hommy/Cacique”; Jonathan Ramos, a.k.a. “Zurdo”; Josué Rosado-Ríos, a.k.a. “Josué”; Juan C. Borrero-Silva, a.k.a. “Mata/Matta”; Emilio J. Alomar-García, a.k.a. “Machua/Macho/Millo”; Alexandro Rivera-Pérez, a.k.a. “El Cojo/Alex El Cojo”; Santiago De Jesús-Martínez, a.k.a. “Junito/Yairan”; Alex Manuel Malavet-Rivera, a.k.a. “Alexito”; Hector Pagán-Vega, a.k.a. “Piky”; Eric Tomás Nazario-Torres, a.k.a. “Eric/Eric Cripy”; Jesús M. Vargas-Vargas, a.k.a. “Bombo/Manuel”; Anthony Nazario-Ortiz, a.k.a. “El Negro”; José Luis Pabón-Custodio, a.k.a. “Joseito”; José A. Cintrón-Ortiz, a.k.a. “Rubia/Colorao/Barbie”; Juan C. Borrero-Ramírez, a.k.a. “Aspirina/Aspi”; Gerardo Rosado, a.k.a. “Gistro/Yistro/El Chacal”; Yalexis Fernández-García, a.k.a. “Lija/Flaco”; Rubén A. Rivera-Soto, a.k.a. “Piño”; Jean C. Velázquez-Cebollero, a.k.a. “Cebollero”; Gilberto Laboy-Nadal, a.k.a. “Papito/Papito Winston”; Randell Soto-Alvarado, a.k.a. “Bambino”; Victor Andrés Segarra-Vega, a.k.a. “Andy/Andie”; Victor Manuel Segarra-Vega, a.k.a. “Ito”; William D. Sanabria-Torres Jr., a.k.a. “W/William”; Anthony Almodovar-Guzmán, a.k.a. “Anthony”; Christopher González-Figueroa, a.k.a. “Offer”; Jonathan González-Figueroa, a.k.a. “Menor/Johnny”; José Manuel López-Velázquez, a.k.a. “Gordo”; Erik Antonio Avilés- Vega, a.k.a. “Eric/Erick/Erikcito/Erik-Chiquito”; Christopher Rosa-Moreno, a.k.a. “Chris”; Joseph Joamil Fontanez-Colón, a.k.a. “Nueva Atenas/Joamil/Cano”; Vilma Janet Vázquez-Vargas, a.k.a. “Janet/La Pata”; José J. Colón-Ramírez, a.k.a. “Yaye”; Arístides Rivera-Alvarado, a.k.a. “Fama”; Alberto Pimentel-Rodríguez, a.k.a. “Alberto”; Alexander Omar González-Morales, a.k.a. “Alexander”; Luis Ángel García-Ríos, a.k.a. “Boxeador”; Wilson Berríos-Flores, a.k.a. “Panda”; Axcel Orlando-Barral, a.k.a. “Axel/Uno-Nene”; Jeisabel Torruella-Almodovar, a.k.a. “Jei”; Freddyson Orengo-Rivera, a.k.a. “Menor”; Kevin Antonio Colón-Meléndez, a.k.a. “Atleta”; Ángel L.  González-Morales, a.k.a. “Anuel”; Javier I. Montes-Medina, a.k.a. “Ivan”; Fernando L. Rivera-Quiñones, a.k.a. “Nandin/Colorao/Nando”; Samuel Jesús Castillo-Santana, a.k.a. “Simbólico”; Pedro Pacheco-Rodríguez, a.k.a. “Pedro”; and Katherine Colón-Negrón, a.k.a. “Katy-Troll”.

“I am grateful for the tireless efforts of the investigators and prosecutors who have dismantled this drug trafficking organization with today’s indictment,” said Rosa Emilia Rodríguez-Vélez, U.S. Attorney for the District of Puerto Rico. “We will continue to investigate these violent criminal organizations with our law enforcement counterparts, and send a clear message that drugs, firearms, and violence will not be tolerated in our neighborhoods.” 

“The results of this operation show the commitment of HSI, and that of our partners in PRPD and the DEA, to rid our communities of individuals involved in criminal activity,” said Ivan J. Arvelo, special agent in charge for HSI San Juan. “Because of the hard work and efforts of HSI and DEA special agents and PRPD officers, we have 50 fewer alleged criminals in the streets, thus making our neighborhoods safer. This is only the beginning of a series of surges to return our communities to law-abiding citizens from unscrupulous criminals who have no respect for human life and dignity.”

“Today’s operation is a reflection of successful inter-agency cooperation. The dismantlement of violent organizations like this one, takes time. Since 2017, the Drug Enforcement Administration (DEA), Homeland Security Investigations, and the Puerto Rico Police Department have been relentless in targeting the criminal elements affecting the citizens of Ponce and surrounding municipalities. Working alongside the United States Attorneys’ Office, today we bettered the lives not only of the residents of these communities, but our quality of life as citizens of Puerto Rico. DEA will stay here, and we will prevail,” stated A.J. Collazo, DEA Caribbean Division Special Agent in Charge.

Assistant U.S. Attorney María L. Montañez-Concepción is in charge of the prosecution of the case. If convicted the defendants face a minimum sentence of 10 years, and up to life in prison. Indictments contain only charges and are not evidence of guilt. Defendants are presumed to be innocent until and unless proven guilty.

This case is part of the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program operates nationwide and combines the resources and unique expertise of numerous federal agencies in a coordinated attack against major drug trafficking and money laundering organizations. All U.S. Attorney’s Offices work in partnership with federal, state, and local law enforcement, as well as the local civilian community, to develop effective, targeted strategies to reduce drugs and drug related violence in the communities. This case is a product of that collaborative effort.

# # #

Greenbelt, Maryland – Darnell E. Bassett, age 24, of Washington, D.C., pleaded guilty to involuntary manslaughter in connection with a fatal accident on the Baltimore-Washington Parkway.  The guilty plea was entered on September 25, 2019.

The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur; Acting Chief Gregory T. Monahan of the U.S. Park Police; and Chief Peter Newsham of the Metropolitan Police Department.

According to his plea agreement, on June 24, 2019, a vehicle driven by Bassett was involved in a collision with a District of Columbia Metropolitan Police cruiser in northeast Washington, D.C.  The police vehicle was disabled, but Bassett continued driving at a high rate of speed, going the wrong way on a one-way street.  Another marked Metropolitan Police vehicle pursued Bassett with its lights and siren activated.  Bassett did not stop, making his way into Maryland on the Baltimore-Washington Parkway.

Bassett continued driving northbound on the Baltimore-Washington Parkway at a high rate of speed and passed other vehicles by driving on the right shoulder of the highway.  Sometime during the incident, one of his tires blew out, but Bassett nevertheless continued driving on the shoulder of the highway and passing other traffic.  While driving at least 70 miles per hour, Bassett began to take the right-side exit ramp to the inner loop of Interstate 495, then veered left across the on-ramp and into the triangular painted safety zone between the ramp and the travel lanes, striking a Honda CR-V that was stopped in the safety zone.  The Honda spun around and then turned onto its side.  The driver of the Honda died as a result of the crash. 

Bassett faces a maximum sentence of eight years in prison.  As part of his plea agreement, Bassett is also required to pay restitution in the full amount of the victim’s losses and injuries caused to the victim and the victim’s vehicle, which includes but is not limited to the costs of the victim’s funeral and burial costs.  U.S. District Judge George J. Hazel has scheduled sentencing for November 27, 2019 at 2:00 p.m.

United States Attorney Robert K. Hur commended the U.S. Park Police and the Metropolitan Police Department for their work in the investigation.  Mr. Hur thanked Assistant U.S. Attorneys Michael Morgan and Hollis Raphael Weisman, who are prosecuting the case.

# # #

Four individuals, including two doctors, a pharmacist who had previously lost his license and been excluded from participating in the Medicaid and Medicare programs and a pharmacy owner have been charged for their participation in schemes in which the Medicare and Medicaid programs were fraudulently billed more than $17 million.  A fifth individual, a registered nurse, pleaded guilty to possession of fentanyl that he stole from his employer, a hospital on Long Island.  The charges filed in federal court in Brooklyn and Central Islip are part of a coordinated health care fraud enforcement action across seven federal districts in the northeast United States, led by the Medicare Fraud Strike Force, that resulted in criminal charges against 48 defendants for their alleged participation in health care fraud schemes involving more than $800 million in false and fraudulent claims.

The charges were announced by Richard P. Donoghue, United States Attorney for the Eastern District of New York; Brian A. Benczkowski, Assistant Attorney General of the Justice Department’s Criminal Division;  William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI); Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA); and Scott J. Lampert, Special Agent-in-Charge, U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations, New York Regional Office (HHS-OIG). 

“As alleged, defendants charged in the Eastern District of New York used fraud and deceit to steal Medicaid and Medicare funds meant to protect our elderly and most vulnerable residents,” stated United States Attorney Donoghue.  “As this initiative demonstrates, we will continue to bring to justice those that defraud our nation’s health care programs.” 

“Physicians and other medical professionals who fraudulently bill our federal health care programs are stealing from taxpayers and robbing vulnerable patients of necessary medical care.  The medical professionals and others engaging in criminal behavior by peddling opioids for profit continue to fuel our nation’s drug crisis,” stated Assistant Attorney General Benczkowski.  “The Department of Justice will continue to use every tool at our disposal, including data analytics and traditional law enforcement techniques, to investigate, prosecute, and punish this reprehensible behavior and protect federal programs from abuse.”

 “As alleged today, the defendants took advantage of programs established for the benefit of those less fortunate, allowing themselves to profit by defrauding the government of public money. May today’s charges remind those who tear holes in the government safety net that they will face the error of their ways,” stated FBI Assistant Director-in-Charge Sweeney.

“There is no difference between the diversion of prescription medication to street drug trafficking,” stated DEA Special Agent-in-Charge Donovan.  “Allegedly, Kevin McMahon abused his position as a registered nurse diverting fentanyl for his personal use.  The DEA and our law enforcement partners’ goal is to keep our citizens safe by guarding against health care fraud and the illegal diversion of prescription medication.”    

 “Healthcare fraud is not a victimless crime—with unscrupulous providers preying on Medicare beneficiaries and taxpayers alike.  Especially insidious is the fraud committed by healthcare professionals who are trusted to provide needed, quality services to patients,” stated HHS-OIG Special Agent-in-Charge Lampert.  “With our law enforcement partners, our agency will continue to thoroughly investigate medical providers and others involved in healthcare fraud.”

The schemes charged in the Eastern District of New York, detailed in two indictments, one complaint and one criminal information, are as follows:

United States v. Anna Steiner:  The superseding indictment charges Anna Steiner, a licensed anesthesiologist, was charged for her role in an alleged $17.4 million health care fraud scheme related to the payment of kickbacks in return for prescribing and ordering durable medical equipment, prescription drugs and diagnostic tests that were neither medically necessary nor resulted from an examination by or consultation with a physician.  Steiner was charged with conspiracy to commit health care fraud and health care fraud in a superseding indictment filed on September 19, 2019.  The case is being prosecuted by Department of Justice Trial Attorney Andrew Estes of the Criminal Division’s Fraud Section. 

United States v. Denny Martin:  Denny Martin, a licensed neurologist who was the sole owner of AM PM Medical P.C., was charged with health care fraud for his role in a scheme to falsely bill Medicare for treatments that were never performed.  Between 2015 and 2019, AM PM Medical P.C. submitted more than 3,000 in fraudulent claims for home health and podiatry visits to the Medicare program.  Martin was arrested this morning and arraigned before United States Magistrate Judge Robert M. Levy at the federal courthouse in Brooklyn.  The case is being prosecuted by Assistant United States Attorney William P. Campos of the U.S. Attorney’s Office for the Eastern District of New York. 

United States v. Andrew Barrett and Phyllis Pincus:  Andrew Barrett, a pharmacist who had been previously convicted of healthcare fraud in 2016 and excluded from the Medicare and Medicaid programs, and Phyllis Pincus, the sole proprietor of two New York-based pharmacies, were indicted on September 24, 2019 for health care fraud, false claims and conspiracy to defraud the United States by submitting fraudulent claims to Medicare and Medicaid for medications that were not actually dispensed to patients.    The case is being prosecuted by Assistant United States Attorney William P. Campos of the U.S. Attorney’s Office for the Eastern District of New York.

United States v. Kevin McMahon:  Kevin McMahon, a registered nurse, was charged with possession of fentanyl, a Schedule II controlled substance.  The charge stem from McMahon’s theft of a synthetic opioid fentanyl while employed at Nassau University Medical Center.  McMahon was arraigned and pleaded guilty to a criminal information at the federal courthouse in Central Islip on September 25, 2019.  The case is being prosecuted by Assistant United States Attorney Erin E. Argo of the U.S. Attorney’s Office for the Eastern District of New York.

The Eastern District of New York’s Healthcare Fraud Strike Force, supervised by the U.S. Attorney’s Office for the Eastern District of New York and the Criminal Division’s Fraud Section, was created in 2009 and since its inception has charged well over 100 defendants, many of which were medical professionals.

The charges are allegations, and the defendants are presumed innocent unless and until proven guilty.

The Defendants:

DR. ANNA STEINER
Age:  63
Valatie, New York
E.D.N.Y. Docket No. 19-CR-295 (ILG)

DR. DENNY MARTIN
Age: 46
New York, New York
E.D.N.Y. Docket No. 19-MJ-847

ANDREW BARRETT
Age: 60
New City, New YorkE.D.N.Y. Docket No. 19-CR-436 (RJD)

PHYLLIS PINCUS
Age: 58
New City, New York
E.D.N.Y. Docket No. 19-CR-0436 (RJD)

KEVIN McMAHON
Age: 31
Seaford, New York
E.D.N.Y. Docket No. 19-CR-422 (ARL)