The following excerpt is from the Department of Justice website:
THURSDAY, SEPTEMBER 15, 2011
“WASHINGTON — Bridgestone Corporation has agreed to plead guilty and to pay a $28 million criminal fine for its role in conspiracies to rig bids and to make corrupt payments to foreign government officials in Latin America related to the sale of marine hose and other industrial products manufactured by the company and sold throughout the world, announced Acting Assistant Attorney General Sharis A. Pozen of the Department of Justice’s Antitrust Division and Assistant Attorney General Lanny A. Breuer of the Department of Justice’s Criminal Division.
A two-count criminal information was filed today in U.S. District Court in Houston against Bridgestone, a Tokyo-headquartered manufacturer of marine hose and other industrial products, charging the company with conspiring to violate the Sherman Act and the Foreign Corrupt Practices Act (FCPA). According to the court document, Bridgestone conspired to rig bids, fix prices and allocate market shares of marine hose in the United States and elsewhere and, separately, conspired to make corrupt payments to government officials in various Latin American countries to obtain and retain business. The department said Bridgestone participated in the conspiracies from as early as January 1999, and continuing until as late as May 2007.
Under the terms of the plea agreement, which is subject to court approval, Bridgestone has also agreed to cooperate fully in the department’s ongoing investigations.
Marine hose is a flexible rubber hose used to transfer oil between tankers and storage facilities. During the bid rigging conspiracy, according to the court document, the cartel affected prices for hundreds of millions of dollars worth of marine hose and related products sold worldwide.
According to the antitrust charge, Bridgestone and its co-conspirators agreed to allocate shares of the marine hose market and to use a price list for marine hose in order to implement the conspiracy. Bridgestone and its co-conspirators agreed not to compete for one another’s customers either by not submitting prices or bids, or by submitting intentionally high prices or bids to certain customers. As part of the conspiracy, Bridgestone and its co-conspirators provided information received from customers in the United States and elsewhere about upcoming marine hose jobs to a co-conspirator who served as the coordinator of the conspiracy. Bridgestone received marine hose prices for customers in the United States and elsewhere from the coordinator of the conspiracy and then sold the marine hose to those customers at collusive and noncompetitive prices and then concealed the conspiracy through various means, including code names, private email accounts and telephone numbers.
The department also charged that, in order to secure sales of marine hose in Latin America, Bridgestone authorized and approved corrupt payments to foreign government officials employed at state-owned entities. Bridgestone’s local sales agents agreed to pay employees of state-owned customers a percentage of the total value of proposed sales. When Bridgestone secured a sale, it would pay the local sales agent a “commission” consisting of not only the local sales agent’s actual commission but also the corrupt payments to be made to employees of the state-owned customer. The local sales agent then was responsible for passing the agreed-upon corrupt payment to the employees of the customer.
Bridgestone is the fifth company to be charged in the Antitrust Division’s bid rigging investigation. To date, nine individuals have been convicted and sentenced to a total of 4,557 days in prison for their involvement in the marine hose conspiracy, including Misao Hioki, the former general manager of Bridgestone’s international engineered products department, who was sentenced to two years in prison on Dec. 10, 2008. Hioki also pleaded guilty and was sentenced for his role in the FCPA conspiracy.
Bridgestone is charged with conspiring to violate the Sherman Act, which carries a maximum $100 million criminal fine for corporations. Bridgestone is also charged with conspiring to violate the FCPA, which carries a maximum $500,000 fine for corporations. The maximum fine for each count may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
Under the plea agreement, the department recognized Bridgestone’s cooperation with the investigations, including conducting a worldwide internal investigation, voluntarily making employees available for interviews, and collecting, analyzing and providing to the department voluminous evidence and information. In addition, the plea agreement acknowledges Bridgestone’s extensive remediation, including restructuring the relevant part of its business, terminating many of its third-party agents and taking remedial actions with respect to employees responsible for many of the corrupt payments. Under the terms of the plea agreement, Bridgestone has committed to continuing to enhance its compliance program and internal controls. As a result of these mitigating factors, the department agreed to recommend a substantially reduced fine.
This case is being prosecuted by the Antitrust Division’s National Criminal Enforcement Section and the Criminal Division’s Fraud Section. In addition to the Antitrust and Criminal Divisions, the ongoing investigation is being conducted by the Defense Criminal Investigative Service (DCIS) of the Department of Defense’s Office of Inspector General, the U.S. Navy Criminal Investigative Service and the FBI. Law enforcement agencies from multiple foreign jurisdictions are also investigating or assisting in the ongoing matter.“
Thursday, September 15, 2011
25 FIRMS SUED FOR NOT BEING REGISTERED TO ENGAGE IN FOREIGN CURRENCY MARKET TRANSACTIONS
The following excerpt is from the Commodity Futures Trading Commission website
:
Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) announced that it simultaneously filed 10 enforcement actions in Federal District Courts in Illinois, New York, Utah, and Wyoming, alleging that 11 entities are illegally soliciting members of the public to engage in foreign currency (forex) transactions and are operating without being registered with the CFTC. These cases follow on the CFTC’s January 26, 2011 filings against 14 other entities for similar violations (see CFTC Press Release 5974-11).
According to CFTC Director of Enforcement David Meister: “These actions reflect the CFTC’s continued resolve to make the forex market safer for investors by strictly enforcing the CFTC’s new forex regulations, which became effective in October 2010. These new regulations require entities that wish to participate in the forex market to register with the CFTC and abide by regulations that are intended to protect the public from potentially fraudulent operations.”
The following companies were sued by the CFTC as part of this sweep:
1st Investment Management, LLC
City Credit Capital, (UK) Ltd.
Enfinium Pty Ltd.
GBFX, LLC
Gold & Bennett, LLC
InterForex, Inc.
Lucid Financial, Inc.
MF Financial, Ltd.
O.C.M. Online Capital Markets Limited
Trading Point of Financial Instruments Ltd.
Windsor Brokers, Ltd.
In the forex market, Retail Foreign Exchange Dealers (RFEDs) and Futures Commission Merchants (FCMs) act as the counter-party to their customers’ purchase and sale of forex. Under the Commodity Exchange Act (CEA) and CFTC Regulations, an entity acting as an RFED or FCM must register with the CFTC. Further, with a few exceptions, such an entity also must be registered with the CFTC if it solicits or accepts orders from U.S. investors in connection with forex transactions conducted at an RFED or FCM.
In all but two of the complaints, the CFTC alleges that a defendant acted as an RFED; that is it offered to take or took the opposite side of a customer’s forex transaction, without being registered. In the remaining two complaints against GBFX, LLC/Gold & Bennett, LLC and Lucid Financial, Inc., the CFTC alleges that the defendant solicited customers to place forex trades at an RFED without being registered as an Introducing Broker. Further, in every complaint, the CFTC alleges that the defendant solicited or accepted orders from U.S. investors to enter into forex transactions in violation of the CEA.
The CFTC is seeking preliminary injunctions to prevent these defendants from operating as alleged unless and until they comply with the CEA and CFTC Regulations. The CFTC’s complaints also seek civil monetary penalties, trading and registration bans, disgorgement, and rescission.
With respect to the similar actions filed in January 2011, 11 of the14 defendants have either settled the charges or defaulted, and the charges against the remaining three are pending.”
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:
Washington, DC - The U.S. Commodity Futures Trading Commission (CFTC) announced that it simultaneously filed 10 enforcement actions in Federal District Courts in Illinois, New York, Utah, and Wyoming, alleging that 11 entities are illegally soliciting members of the public to engage in foreign currency (forex) transactions and are operating without being registered with the CFTC. These cases follow on the CFTC’s January 26, 2011 filings against 14 other entities for similar violations (see CFTC Press Release 5974-11).
According to CFTC Director of Enforcement David Meister: “These actions reflect the CFTC’s continued resolve to make the forex market safer for investors by strictly enforcing the CFTC’s new forex regulations, which became effective in October 2010. These new regulations require entities that wish to participate in the forex market to register with the CFTC and abide by regulations that are intended to protect the public from potentially fraudulent operations.”
The following companies were sued by the CFTC as part of this sweep:
1st Investment Management, LLC
City Credit Capital, (UK) Ltd.
Enfinium Pty Ltd.
GBFX, LLC
Gold & Bennett, LLC
InterForex, Inc.
Lucid Financial, Inc.
MF Financial, Ltd.
O.C.M. Online Capital Markets Limited
Trading Point of Financial Instruments Ltd.
Windsor Brokers, Ltd.
In the forex market, Retail Foreign Exchange Dealers (RFEDs) and Futures Commission Merchants (FCMs) act as the counter-party to their customers’ purchase and sale of forex. Under the Commodity Exchange Act (CEA) and CFTC Regulations, an entity acting as an RFED or FCM must register with the CFTC. Further, with a few exceptions, such an entity also must be registered with the CFTC if it solicits or accepts orders from U.S. investors in connection with forex transactions conducted at an RFED or FCM.
In all but two of the complaints, the CFTC alleges that a defendant acted as an RFED; that is it offered to take or took the opposite side of a customer’s forex transaction, without being registered. In the remaining two complaints against GBFX, LLC/Gold & Bennett, LLC and Lucid Financial, Inc., the CFTC alleges that the defendant solicited customers to place forex trades at an RFED without being registered as an Introducing Broker. Further, in every complaint, the CFTC alleges that the defendant solicited or accepted orders from U.S. investors to enter into forex transactions in violation of the CEA.
The CFTC is seeking preliminary injunctions to prevent these defendants from operating as alleged unless and until they comply with the CEA and CFTC Regulations. The CFTC’s complaints also seek civil monetary penalties, trading and registration bans, disgorgement, and rescission.
With respect to the similar actions filed in January 2011, 11 of the14 defendants have either settled the charges or defaulted, and the charges against the remaining three are pending.”
, a Cyprus company. a Cyprus company; and, a British Virgin Islands company, a Belize company with offices in New York City;, a Utah corporation;, a British Virgin Islands company;, a New York LLC;, a New York LLC;, an Australian company;, a United Kingdom company;, a Wyoming LLC;
Wednesday, September 14, 2011
FORMER CEO OF FLORIDA BASED COMPANY SENTENCED TO 46 MONTHS IN PRISON FOR BRIBING GOVERNMENT OFFICIALS
The following is an excerpt from the Department of Justice website:
Thursday, September 8, 2011
Former CEO of U.S. Telecommunications Company Sentenced to 46 Months in Prison for Bribing Foreign Government Officials
WASHINGTON - A former chief executive officer of Florida-based telecommunications company Latin Node Inc. (LatiNode) was sentenced yesterday to 46 months in prison for paying bribes to former government officials in Honduras, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.
U.S. District Judge Joan A. Lenard for the Southern District of Florida also ordered Jorge Granados, of Miami, to serve two years of supervised release following the prison term.
Granados, 55, pleaded guilty on May 19, 2011, to conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA) in connection with a scheme to pay Honduran officials more than $500,000 in bribes. To date, four former senior executives of LatiNode have pleaded guilty to conspiring to pay bribes to the Honduran officials.
In his guilty plea, Granados admitted to authorizing corrupt payments to foreign government officials for the purpose of securing business advantages for LatiNode from Honduras’s state-owned telecommunications company, Empresa Hondureña de Telecomunicaciones (Hondutel). According to court documents, LatiNode provided wholesale telecommunications services using Internet protocol technology to countries throughout the world, including Honduras. In December 2005, LatiNode learned that it was the sole winner of an “interconnection agreement” with Hondutel, permitting LatiNode to use Hondutel’s telecommunications lines to establish a network between Honduras and the United States and to provide long distance services between the two countries.
According to court documents, Granados and other LatiNode executives, including Manuel Salvoch, the chief financial officer; Manuel Caceres, the vice president for business development; and Juan Pablo Vasquez, the chief commercial officer, agreed to a secret deal to pay bribes to Hondutel officials, including the general manager, a senior attorney for Hondutel, and a minister of the Honduran government who became a representative on the Hondutel Board of Directors. According to court documents, between September 2006 and June 2007, Granados and others caused more than $500,000 in bribes to be paid to the Honduran officials, concealing many of the payments by laundering the money through LatiNode subsidiaries in Guatemala and to accounts in Honduras controlled by the Honduran government officials.
LatiNode pleaded guilty on April 7, 2009, to a one-count information charging the company with a criminal violation of the FCPA and agreed to pay a $2 million fine. The resolution of the criminal investigation of LatiNode reflected, in large part, the actions of eLandia International Inc. in disclosing potential FCPA violations to the department after eLandia’s acquisition of LatiNode in 2007 and discovery of the improper payments.
Salvoch pleaded guilty on Jan. 12, 2011, to conspiracy to violate the FCPA and is scheduled to be sentenced on Dec. 7, 2011. Vasquez pleaded guilty on Jan. 21, 2011, to conspiracy to violate the FCPA and is scheduled to be sentenced on Dec. 8, 2011. Caceres pleaded guilty on May 18, 2011, to conspiracy to violate the FCPA, and is scheduled to be sentenced on Nov. 28, 2011. The three defendants each face prison sentences of up to five years.
The case was prosecuted by Principal Deputy Chief Jeffrey H. Knox and Trial Attorney Amanda Aikman of the Criminal Division’s Fraud Section. Significant assistance was provided by Trial Attorney James M. Koukios. The case was investigated by the FBI’s Miami Field Office and ICE Homeland Security Investigation’s Foreign Corruption Investigations Group in Miami.”
Thursday, September 8, 2011
Former CEO of U.S. Telecommunications Company Sentenced to 46 Months in Prison for Bribing Foreign Government Officials
WASHINGTON - A former chief executive officer of Florida-based telecommunications company Latin Node Inc. (LatiNode) was sentenced yesterday to 46 months in prison for paying bribes to former government officials in Honduras, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.
U.S. District Judge Joan A. Lenard for the Southern District of Florida also ordered Jorge Granados, of Miami, to serve two years of supervised release following the prison term.
Granados, 55, pleaded guilty on May 19, 2011, to conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA) in connection with a scheme to pay Honduran officials more than $500,000 in bribes. To date, four former senior executives of LatiNode have pleaded guilty to conspiring to pay bribes to the Honduran officials.
In his guilty plea, Granados admitted to authorizing corrupt payments to foreign government officials for the purpose of securing business advantages for LatiNode from Honduras’s state-owned telecommunications company, Empresa Hondureña de Telecomunicaciones (Hondutel). According to court documents, LatiNode provided wholesale telecommunications services using Internet protocol technology to countries throughout the world, including Honduras. In December 2005, LatiNode learned that it was the sole winner of an “interconnection agreement” with Hondutel, permitting LatiNode to use Hondutel’s telecommunications lines to establish a network between Honduras and the United States and to provide long distance services between the two countries.
According to court documents, Granados and other LatiNode executives, including Manuel Salvoch, the chief financial officer; Manuel Caceres, the vice president for business development; and Juan Pablo Vasquez, the chief commercial officer, agreed to a secret deal to pay bribes to Hondutel officials, including the general manager, a senior attorney for Hondutel, and a minister of the Honduran government who became a representative on the Hondutel Board of Directors. According to court documents, between September 2006 and June 2007, Granados and others caused more than $500,000 in bribes to be paid to the Honduran officials, concealing many of the payments by laundering the money through LatiNode subsidiaries in Guatemala and to accounts in Honduras controlled by the Honduran government officials.
LatiNode pleaded guilty on April 7, 2009, to a one-count information charging the company with a criminal violation of the FCPA and agreed to pay a $2 million fine. The resolution of the criminal investigation of LatiNode reflected, in large part, the actions of eLandia International Inc. in disclosing potential FCPA violations to the department after eLandia’s acquisition of LatiNode in 2007 and discovery of the improper payments.
Salvoch pleaded guilty on Jan. 12, 2011, to conspiracy to violate the FCPA and is scheduled to be sentenced on Dec. 7, 2011. Vasquez pleaded guilty on Jan. 21, 2011, to conspiracy to violate the FCPA and is scheduled to be sentenced on Dec. 8, 2011. Caceres pleaded guilty on May 18, 2011, to conspiracy to violate the FCPA, and is scheduled to be sentenced on Nov. 28, 2011. The three defendants each face prison sentences of up to five years.
The case was prosecuted by Principal Deputy Chief Jeffrey H. Knox and Trial Attorney Amanda Aikman of the Criminal Division’s Fraud Section. Significant assistance was provided by Trial Attorney James M. Koukios. The case was investigated by the FBI’s Miami Field Office and ICE Homeland Security Investigation’s Foreign Corruption Investigations Group in Miami.”
Monday, September 12, 2011
ACCENTURE LLP PAYS OVER $63 MILLION FOR ALLEGEDLY DEFRAUDING THE U.S. GOVERNMENT
The following is an excerpt from the Department of Justice website:
Monday, September 12, 2011
WASHINGTON – Accenture LLP has agreed to pay the United States $63.675 million to resolve a whistleblower lawsuit, the Justice Department announced today. The lawsuit, filed in the U.S. District Court for the Eastern District of Arkansas, alleges that Accenture submitted or caused to be submitted false claims for payment under numerous contracts with agencies of the United States for information technology services.
Accenture has agreed to resolve allegations that it received kickbacks for its recommendations of hardware and software to the government, fraudulently inflated prices and rigged bids in connection with federal information technology contracts.
“Kickbacks and bid rigging undermine the integrity of the federal procurement process,” said Tony West, Assistant Attorney General for the Justice Department’s Civil Division. “At a time when we're looking for ways to reduce our public spending, it is especially important to ensure that government contractors play by the rules and don’t waste precious taxpayer dollars.”
“We strive each and every day to bring justice to the citizens of the Eastern District of Arkansas,” stated Christopher R. Thyer, U.S. Attorney for the Eastern District of Arkansas. “Fraudulent business practices that steal hard earned and much needed tax dollars from appropriate use will not be tolerated. The United States Attorney’s Office is committed to pursuing these cases to the full extent of the law.”
The lawsuit was initially filed by Norman Rille and Neal Roberts under the qui tam or whistleblower provisions of the federal False Claims Act, which permit private individuals, called “relators” to bring lawsuits on behalf of the United States and receive a portion of the proceeds of a settlement or judgment awarded against a defendant. The portion of the proceeds to be paid in this case has not yet been resolved.
“Companies profiting off the breach of their government contracts will pay,” said Brian D. Miller, General Services Administration Inspector General.
The case was handled by the Department of Justice’s Civil Division and the US Attorney’s Office for the Eastern District of Arkansas, with the assistance of the Defense Criminal Investigative Service and the Offices of Inspector General of the Department of Energy, the Department of Education, Department of Treasury Tax Administration (TIGTA), General Services Administration, Department of State and Transportation Security Administration.”
Monday, September 12, 2011
WASHINGTON – Accenture LLP has agreed to pay the United States $63.675 million to resolve a whistleblower lawsuit, the Justice Department announced today. The lawsuit, filed in the U.S. District Court for the Eastern District of Arkansas, alleges that Accenture submitted or caused to be submitted false claims for payment under numerous contracts with agencies of the United States for information technology services.
Accenture has agreed to resolve allegations that it received kickbacks for its recommendations of hardware and software to the government, fraudulently inflated prices and rigged bids in connection with federal information technology contracts.
“Kickbacks and bid rigging undermine the integrity of the federal procurement process,” said Tony West, Assistant Attorney General for the Justice Department’s Civil Division. “At a time when we're looking for ways to reduce our public spending, it is especially important to ensure that government contractors play by the rules and don’t waste precious taxpayer dollars.”
“We strive each and every day to bring justice to the citizens of the Eastern District of Arkansas,” stated Christopher R. Thyer, U.S. Attorney for the Eastern District of Arkansas. “Fraudulent business practices that steal hard earned and much needed tax dollars from appropriate use will not be tolerated. The United States Attorney’s Office is committed to pursuing these cases to the full extent of the law.”
The lawsuit was initially filed by Norman Rille and Neal Roberts under the qui tam or whistleblower provisions of the federal False Claims Act, which permit private individuals, called “relators” to bring lawsuits on behalf of the United States and receive a portion of the proceeds of a settlement or judgment awarded against a defendant. The portion of the proceeds to be paid in this case has not yet been resolved.
“Companies profiting off the breach of their government contracts will pay,” said Brian D. Miller, General Services Administration Inspector General.
The case was handled by the Department of Justice’s Civil Division and the US Attorney’s Office for the Eastern District of Arkansas, with the assistance of the Defense Criminal Investigative Service and the Offices of Inspector General of the Department of Energy, the Department of Education, Department of Treasury Tax Administration (TIGTA), General Services Administration, Department of State and Transportation Security Administration.”
MAJOR HOME HEALTHCARE PROVIDER TO PAY APPROXIMATELY $150 MILLION TO SETTLE FRAUD CHARGES
The following is from the Department of Justice website:
Monday, September 12, 2011
“Maxim Healthcare Services Charged with Fraud, Agrees to Pay Approximately $150 Million, Enact Reforms After False Billings Revealed as Common Practice
Nine, Including Senior Managers, Have Pleaded Guilty to Felony Charges for Related Conduct
NEWARK, N.J. – Maxim Healthcare Services Inc., one of the nation’s leading providers of home healthcare services, has entered into a settlement to resolve criminal and civil charges relating to a nationwide scheme to defraud Medicaid programs and the Veterans Affairs program of more than $61 million.
Today’s announcement was made by Tony West, Assistant Attorney General of the Civil Division of the Department of Justice; J. Gilmore Childers, Acting U.S. Attorney for the District of New Jersey; Tom ODonnell, Special Agent in Charge of the Health and Human Services Office of Inspector General (HHS-OIG) region covering New Jersey; Michael B. Ward, Special Agent in Charge of the FBI’s Newark, N.J., Field Office; and Jeffrey Hughes, Special Agent in Charge of the U.S. Department of Veterans Affairs, Office of the Inspector General (VA OIG), Northeast Field Office.
Maxim was charged today in a criminal complaint with conspiracy to commit health care fraud, and has entered into a deferred prosecution agreement (DPA) with the Department of Justice. The agreement will allow Maxim to avoid a health care fraud conviction on the charges if it complies with the DPA’s requirements. As required by the DPA, which will expire in 24 months if the company meets all of its reform and compliance requirements, Maxim has agreed to pay a criminal penalty of $20 million and to pay approximately $130 million in civil settlements in the matter, including to federal False Claims Act claims.
To date, nine individuals – eight former Maxim employees, including three senior managers and the parent of a former Maxim patient – have pleaded guilty to felony charges arising out of the submission of fraudulent billings to government health care programs, the creation of fraudulent documentation associated with government program billings, or false statements to government health care program officials regarding Maxim’s activities.
The criminal complaint accuses Maxim, a privately-held company based in Columbia, Md., with hundreds of offices throughout the United States, of submitting more than $61 million in fraudulent billings to government health care programs for services not rendered or otherwise not reimbursable. The investigation revealed that the submission of false bills to government health care programs was a common practice at Maxim from 2003 through 2009. During that time period, Maxim received more than $2 billion in reimbursements from government health care programs in 43 states based on billings submitted by Maxim.
“Fraudulent billing for services not rendered uses patients as pawns in a game of corporate greed that puts cash over care and wastes precious taxpayer dollars,” said Assistant Attorney General West. “At a time when we're all looking for ways to reduce public expenditures, settlements like this one recapture taxpayer dollars lost to fraud and abuse, and help ensure that funds are available for the vital health care programs and services that people depend on day in and day out.”
“Maxim, including senior executives, defrauded a system providing needed services to turn money meant for patient care into corporate profits,” said Acting U.S. Attorney Childers. “We will continue to prove our commitment to investigating and prosecuting both companies and individuals whose misconduct robs our nation’s health care programs and those who count on them. It is our hope that Maxim, in cleaning up its own house, will be a lighthouse influencing best practices across the industry.”
“Companies scheming to profit by deceiving patients and defrauding taxpayer-funded government health care programs can expect close scrutiny and aggressive investigation,” said HHS-OIG Special Agent in Charge ODonnell. “We will continue to carefully guard the nation’s vital health programs against those who put greed over patient care.”
“Health care fraud is a considerable problem in New Jersey with residents being victimized by an estimated $7.5 billion in care-related frauds in 2010,” said FBI Special Agent in Charge Ward. “The criminal conduct by Maxim in this instance was significant and systemic, which resulted in both the company and individuals being liable for their actions. The Newark Division of the FBI is committed to its stance of being among the most aggressive offices in pursuit and ultimate prosecution of health care fraud offenders.”
“Today’s announcement demonstrates the Department of Veterans Affairs Office of Inspector General’s commitment to focus investigative resources on companies that choose to pursue profit over the public’s health,” said VA OIG Special Agent in Charge Hughes. “VA OIG applauds the hard work of the Department of Justice and our law enforcement counterparts in bringing about this successful conclusion by aggressively pursuing and prosecuting those who committed fraud against our nation’s federal healthcare programs, including VA’s.”
As part of the DPA, Maxim has stipulated to a statement of facts which mirrors the language of the criminal complaint. In the event that Maxim fails to comply with the provisions of the DPA, Maxim has agreed that the U.S. Attorney’s Office may proceed with its prosecution of Maxim and use the agreed-upon statement of facts against it in the prosecution.
As detailed in the criminal complaint, Maxim, through its former officers and employees, falsely and fraudulently submitted billings to government health care programs for services not rendered or otherwise not reimbursable by government health care programs from 2003 through 2009. In order to conceal the fraud, Maxim’s former officers and employees engaged in various conduct during that time period, including creating or modifying time sheets to support billings to government health care programs for services not rendered. They also submitted billings through licensed offices for care actually supervised by offices which operated without licenses and whose existence was concealed from government health care program auditors and investigators. Additionally, they created or modified documentation relating to required administrative functions associated with billings submitted to government health care programs, including documentation reflecting required training and qualifications of caregivers.
The DPA obliges Maxim to continue cooperating in the government’s ongoing federal and state criminal investigation of former Maxim executives and employees responsible for the alleged conduct at issue, and to develop and operate an effective corporate compliance and governance program that includes adequate internal controls to prevent the recurrence of any improper or illegal activities.
The DPA requires Maxim’s acceptance and acknowledgment of full responsibility for the conduct that led to the government’s investigation.
The settlement requires payment of approximately $130 million to Medicaid programs and the Veterans Affairs program to resolve False Claims Act liability for false home healthcare billings to Medicaid programs and the Veterans Administration under civil agreements relating to this matter. The settlement resolves allegations that Maxim billed for services that were not rendered, services that were not properly documented, and services performed by 13 unlicensed offices. Maxim has agreed to pay approximately $70 million to the federal government and approximately $60 million to 42.
Also included in the settlement is a corporate integrity agreement with HHS-OIG, which requires additional reforms and monitoring under HHS-OIG supervision.
In addition, the company must also retain and pay an independent monitor, who will review Maxim’s business operations and regularly report concerning the company’s compliance with all federal and state health care laws, regulations, and programs. The monitor was selected by the U.S. Attorney’s Office, consistent with U.S. Department of Justice guidelines, after a review of monitor candidates and in consultation with the company. Maxim will be monitored by Peter Keith of the law firm Gallagher, Evelius & Jones, which is headquartered in Baltimore.
Prosecution of Individuals
According to documents filed in these cases and statements made in Trenton, N.J., federal court:
Gregory Munzel, 35, of Charleston, S.C., was employed as a regional account manager, reporting directly to a vice president, responsible for Maxim offices throughout the southeastern United States. He pleaded guilty on Dec. 4, 2009, to one count of making false statements relating to health care fraud matters. During his plea hearing, Munzel admitted that he was aware individuals he supervised were submitting time cards for work that had not actually been done – a practice Munzel said was in response to pressure from Maxim superiors to increase revenue. Munzel also acknowledged forging caregiver credentials such as CPR cards throughout his time at Maxim, in order to make it appear that the caregivers were properly credentialed, when they were not. Munzel indicated he learned the practice from his supervisors when he first joined Maxim, and that those under him engaged in the practice when he took on a leadership role with the company. Munzel is currently scheduled to be sentenced Sept. 29, 2011.
Bryan Lee Shipman, 38, of Athens, Ga., worked for Maxim for 13 years, the last eight as a regional account manager, reporting directly to a vice president. He pleaded guilty on June 17, 2010, to one count of health care fraud. During his plea hearing, Shipman acknowledged that Maxim’s Gainesville, Ga., office operated without a license from 2008 through 2009, and that he and others directed billings from that office to be submitted as if they were from another, licensed office to be approved for reimbursement by the Medicaid program. At one point, when Maxim employees believed a state regulator would be visiting the office, lower-level employees were directed to provide false information to the state regulator in an effort to prevent the Medicaid program from learning about the unlicensed operation of the office. Shipman said his superiors demanded levels of growth based “not on any market analysis, but simply on a belief that dramatic growth was necessary regardless of market conditions.” Shipman is currently scheduled to be sentenced Nov. 16, 2011.
Matthew Skaggs, 39, was employed as a regional account manager, reporting directly to a vice president, responsible for Maxim’s offices in Texas. He pleaded guilty on Sept. 23, 2010, to making false statements relating to health care fraud matters. During his plea hearing, Skaggs acknowledged having knowingly made false statements to a surveyor from Texas’ Medicaid Program, who was investigating the operation of an unlicensed Maxim office in Houston. Skaggs was sentenced on June 10, 2011, to a three-year term of probation and ordered to pay a $4,000 fine.
Andrew Sabbaghzadeh, 29, of Clay, N.Y., was employed as an account manager; and Jason Bouche, 27, of Paradise Valley, Ariz., was employed as a recruiter at Maxim’s Tempe, Ariz., office. They pleaded guilty to health care fraud on Nov. 4, 2009, and April 23, 2010, respectively. During their plea hearings, Sabbaghzadeh and Bouche acknowledged creating fraudulent time cards in order to bill government programs. They acknowledged that in some instances, Maxim employees cut signatures from legitimate time cards and pasted them onto forged time cards in order to submit them for reimbursement. Sabbaghzadeh is currently scheduled to be sentenced on Sept. 26, 2011; Bouche is currently scheduled to be sentenced on Nov. 17, 2011.
Donna Ocansey, 49, of Medford, N.J., was employed as a director of clinical services (supervising nurse) in Maxim’s Cherry Hill, N.J., office. She pleaded guilty on May 28, 2010, to making false statements relating to health care fraud matters. Ocansey, a registered nurse, had responsibility for, among other things, ensuring that Medicaid-required supervisory visits of patients were conducted periodically – meaning that a registered nurse periodically visited each patient to check each patient’s condition and the care the patient was receiving from Maxim Home Health Aides, who lack the skills and training of registered nurses. During her plea hearing, Ocansey acknowledged that she fabricated documentation in order to make it appear that other nurses had conducted Medicaid-mandated supervisory visits, when in fact they had not. Ocansey stated that she fabricated documentation in response to pressure from her superiors at Maxim, who expected her to make sure that all supervisory visits were completed without providing adequate resources for her to do so. Ocansey is currently scheduled to be sentenced Sept. 20, 2011.
Mary Shelly Janvier-Pierre, 42, of Lake Worth, Fla., and Sandy Cave, 39, of West Palm Beach, Fla., pleaded guilty to health care fraud on Feb. 1, 2010, and June 21, 2010, respectively. During their plea hearings, Janvier-Pierre, who had been employed by Maxim’s West Palm Beach office as a licensed practical nurse; and Cave, the mother of a former pediatric patient of Maxim, admitted to their roles in a scheme to fraudulently bill Medicaid through Maxim for services that were not rendered. Janvier-Pierre and Cave acknowledged that they agreed to submit billings as if Janvier-Pierre was taking care of Cave’s child, when in reality she was not. Janvier-Pierre and Cave then split the money Janvier-Pierre received for purportedly providing the care. As a result of the scheme, Maxim was paid more than $70,000 by Florida’s Medicaid program. Janvier-Pierre and Cave are scheduled to be sentenced on Sept. 21, 2011, and Oct. 24, 2011, respectively.
Marion Morton, 45, of North Charleston, S.C., was employed as a home health aide and personal care assistant by Maxim’s Charleston office. He pleaded guilty on May 3, 2010, to one count of making false statements relating to health care fraud matters. During his plea hearing, Morton acknowledged that, at the instruction of Maxim employees, he fabricated timecards reflecting work he had not done. On multiple occasions, Maxim submitted bills to Medicaid based on timecards which showed he worked more than 24 hours on certain days. Morton was sentenced on May 24, 2011, to a three-year term of probation and ordered to pay a $5,000 fine.
All of the defendants pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court.
The health care fraud charge to which Shipman, Sabbaghzadeh, Bouche, Janvier-Pierre and Cave pleaded guilty carries a maximum penalty of 10 years in prison and a maximum fine of $250,000, or twice the amount of loss caused by their offenses. The false statements relating to health care fraud matters charge to which defendants Munzel, Skaggs, Ocansey and Morton pleaded guilty carries a maximum penalty of five years in prison and a maximum fine of $250,000, or twice the amount of loss caused by their offenses.
Maxim’s Remedial Actions
The government’s willingness to enter into a DPA with Maxim is due, in significant part, to the company’s cooperation and the reforms and remedial actions the company has taken – beginning particularly in May 2009 – including significant personnel changes: terminating senior executives and other employees the company identified as responsible for the misconduct; establishing and filling of positions of chief executive officer, chief compliance officer, chief operations officer/chief clinical officer, chief quality officer/chief medical officer, chief culture officer, chief financial and strategy officer, and vice president of human resources; and hiring a new general counsel.
The company has identified and disclosed to law enforcement the misconduct of former Maxim employees, including providing information which has been critical in obtaining the convictions of some of the individuals who have pleaded guilty to date. The company has also significantly increased the resources allocated to its compliance program.
The settlement arises from a lawsuit filed under the False Claims Act. Under the qui tam, or whistleblower, provisions of the act, private citizens may file actions on behalf of the United States and share in any recovery. The whistleblower will receive approximately $15.4 million as his share of the recoveries from the federal government and the states.
The criminal complaint, DPA, civil settlement agreement and guilty pleas are the culmination of a multi-year investigation conducted jointly by special agents and investigators from HHS-OIG, under the direction of Special Agent in Charge ODonnell; FBI, under the direction of Special Agent in Charge Ward; and VA OIG, under the direction of Special Agent in Charge Hughes. The National Association of Medicaid Fraud Control Units (NAMFCU) and the Medicaid Fraud Control Units of the New Jersey, Virginia and Massachusetts Attorney General’s Offices also assisted in coordinating the settlements with the various states.”
Monday, September 12, 2011
“Maxim Healthcare Services Charged with Fraud, Agrees to Pay Approximately $150 Million, Enact Reforms After False Billings Revealed as Common Practice
Nine, Including Senior Managers, Have Pleaded Guilty to Felony Charges for Related Conduct
NEWARK, N.J. – Maxim Healthcare Services Inc., one of the nation’s leading providers of home healthcare services, has entered into a settlement to resolve criminal and civil charges relating to a nationwide scheme to defraud Medicaid programs and the Veterans Affairs program of more than $61 million.
Today’s announcement was made by Tony West, Assistant Attorney General of the Civil Division of the Department of Justice; J. Gilmore Childers, Acting U.S. Attorney for the District of New Jersey; Tom ODonnell, Special Agent in Charge of the Health and Human Services Office of Inspector General (HHS-OIG) region covering New Jersey; Michael B. Ward, Special Agent in Charge of the FBI’s Newark, N.J., Field Office; and Jeffrey Hughes, Special Agent in Charge of the U.S. Department of Veterans Affairs, Office of the Inspector General (VA OIG), Northeast Field Office.
Maxim was charged today in a criminal complaint with conspiracy to commit health care fraud, and has entered into a deferred prosecution agreement (DPA) with the Department of Justice. The agreement will allow Maxim to avoid a health care fraud conviction on the charges if it complies with the DPA’s requirements. As required by the DPA, which will expire in 24 months if the company meets all of its reform and compliance requirements, Maxim has agreed to pay a criminal penalty of $20 million and to pay approximately $130 million in civil settlements in the matter, including to federal False Claims Act claims.
To date, nine individuals – eight former Maxim employees, including three senior managers and the parent of a former Maxim patient – have pleaded guilty to felony charges arising out of the submission of fraudulent billings to government health care programs, the creation of fraudulent documentation associated with government program billings, or false statements to government health care program officials regarding Maxim’s activities.
The criminal complaint accuses Maxim, a privately-held company based in Columbia, Md., with hundreds of offices throughout the United States, of submitting more than $61 million in fraudulent billings to government health care programs for services not rendered or otherwise not reimbursable. The investigation revealed that the submission of false bills to government health care programs was a common practice at Maxim from 2003 through 2009. During that time period, Maxim received more than $2 billion in reimbursements from government health care programs in 43 states based on billings submitted by Maxim.
“Fraudulent billing for services not rendered uses patients as pawns in a game of corporate greed that puts cash over care and wastes precious taxpayer dollars,” said Assistant Attorney General West. “At a time when we're all looking for ways to reduce public expenditures, settlements like this one recapture taxpayer dollars lost to fraud and abuse, and help ensure that funds are available for the vital health care programs and services that people depend on day in and day out.”
“Maxim, including senior executives, defrauded a system providing needed services to turn money meant for patient care into corporate profits,” said Acting U.S. Attorney Childers. “We will continue to prove our commitment to investigating and prosecuting both companies and individuals whose misconduct robs our nation’s health care programs and those who count on them. It is our hope that Maxim, in cleaning up its own house, will be a lighthouse influencing best practices across the industry.”
“Companies scheming to profit by deceiving patients and defrauding taxpayer-funded government health care programs can expect close scrutiny and aggressive investigation,” said HHS-OIG Special Agent in Charge ODonnell. “We will continue to carefully guard the nation’s vital health programs against those who put greed over patient care.”
“Health care fraud is a considerable problem in New Jersey with residents being victimized by an estimated $7.5 billion in care-related frauds in 2010,” said FBI Special Agent in Charge Ward. “The criminal conduct by Maxim in this instance was significant and systemic, which resulted in both the company and individuals being liable for their actions. The Newark Division of the FBI is committed to its stance of being among the most aggressive offices in pursuit and ultimate prosecution of health care fraud offenders.”
“Today’s announcement demonstrates the Department of Veterans Affairs Office of Inspector General’s commitment to focus investigative resources on companies that choose to pursue profit over the public’s health,” said VA OIG Special Agent in Charge Hughes. “VA OIG applauds the hard work of the Department of Justice and our law enforcement counterparts in bringing about this successful conclusion by aggressively pursuing and prosecuting those who committed fraud against our nation’s federal healthcare programs, including VA’s.”
As part of the DPA, Maxim has stipulated to a statement of facts which mirrors the language of the criminal complaint. In the event that Maxim fails to comply with the provisions of the DPA, Maxim has agreed that the U.S. Attorney’s Office may proceed with its prosecution of Maxim and use the agreed-upon statement of facts against it in the prosecution.
As detailed in the criminal complaint, Maxim, through its former officers and employees, falsely and fraudulently submitted billings to government health care programs for services not rendered or otherwise not reimbursable by government health care programs from 2003 through 2009. In order to conceal the fraud, Maxim’s former officers and employees engaged in various conduct during that time period, including creating or modifying time sheets to support billings to government health care programs for services not rendered. They also submitted billings through licensed offices for care actually supervised by offices which operated without licenses and whose existence was concealed from government health care program auditors and investigators. Additionally, they created or modified documentation relating to required administrative functions associated with billings submitted to government health care programs, including documentation reflecting required training and qualifications of caregivers.
The DPA obliges Maxim to continue cooperating in the government’s ongoing federal and state criminal investigation of former Maxim executives and employees responsible for the alleged conduct at issue, and to develop and operate an effective corporate compliance and governance program that includes adequate internal controls to prevent the recurrence of any improper or illegal activities.
The DPA requires Maxim’s acceptance and acknowledgment of full responsibility for the conduct that led to the government’s investigation.
The settlement requires payment of approximately $130 million to Medicaid programs and the Veterans Affairs program to resolve False Claims Act liability for false home healthcare billings to Medicaid programs and the Veterans Administration under civil agreements relating to this matter. The settlement resolves allegations that Maxim billed for services that were not rendered, services that were not properly documented, and services performed by 13 unlicensed offices. Maxim has agreed to pay approximately $70 million to the federal government and approximately $60 million to 42.
Also included in the settlement is a corporate integrity agreement with HHS-OIG, which requires additional reforms and monitoring under HHS-OIG supervision.
In addition, the company must also retain and pay an independent monitor, who will review Maxim’s business operations and regularly report concerning the company’s compliance with all federal and state health care laws, regulations, and programs. The monitor was selected by the U.S. Attorney’s Office, consistent with U.S. Department of Justice guidelines, after a review of monitor candidates and in consultation with the company. Maxim will be monitored by Peter Keith of the law firm Gallagher, Evelius & Jones, which is headquartered in Baltimore.
Prosecution of Individuals
According to documents filed in these cases and statements made in Trenton, N.J., federal court:
Gregory Munzel, 35, of Charleston, S.C., was employed as a regional account manager, reporting directly to a vice president, responsible for Maxim offices throughout the southeastern United States. He pleaded guilty on Dec. 4, 2009, to one count of making false statements relating to health care fraud matters. During his plea hearing, Munzel admitted that he was aware individuals he supervised were submitting time cards for work that had not actually been done – a practice Munzel said was in response to pressure from Maxim superiors to increase revenue. Munzel also acknowledged forging caregiver credentials such as CPR cards throughout his time at Maxim, in order to make it appear that the caregivers were properly credentialed, when they were not. Munzel indicated he learned the practice from his supervisors when he first joined Maxim, and that those under him engaged in the practice when he took on a leadership role with the company. Munzel is currently scheduled to be sentenced Sept. 29, 2011.
Bryan Lee Shipman, 38, of Athens, Ga., worked for Maxim for 13 years, the last eight as a regional account manager, reporting directly to a vice president. He pleaded guilty on June 17, 2010, to one count of health care fraud. During his plea hearing, Shipman acknowledged that Maxim’s Gainesville, Ga., office operated without a license from 2008 through 2009, and that he and others directed billings from that office to be submitted as if they were from another, licensed office to be approved for reimbursement by the Medicaid program. At one point, when Maxim employees believed a state regulator would be visiting the office, lower-level employees were directed to provide false information to the state regulator in an effort to prevent the Medicaid program from learning about the unlicensed operation of the office. Shipman said his superiors demanded levels of growth based “not on any market analysis, but simply on a belief that dramatic growth was necessary regardless of market conditions.” Shipman is currently scheduled to be sentenced Nov. 16, 2011.
Matthew Skaggs, 39, was employed as a regional account manager, reporting directly to a vice president, responsible for Maxim’s offices in Texas. He pleaded guilty on Sept. 23, 2010, to making false statements relating to health care fraud matters. During his plea hearing, Skaggs acknowledged having knowingly made false statements to a surveyor from Texas’ Medicaid Program, who was investigating the operation of an unlicensed Maxim office in Houston. Skaggs was sentenced on June 10, 2011, to a three-year term of probation and ordered to pay a $4,000 fine.
Andrew Sabbaghzadeh, 29, of Clay, N.Y., was employed as an account manager; and Jason Bouche, 27, of Paradise Valley, Ariz., was employed as a recruiter at Maxim’s Tempe, Ariz., office. They pleaded guilty to health care fraud on Nov. 4, 2009, and April 23, 2010, respectively. During their plea hearings, Sabbaghzadeh and Bouche acknowledged creating fraudulent time cards in order to bill government programs. They acknowledged that in some instances, Maxim employees cut signatures from legitimate time cards and pasted them onto forged time cards in order to submit them for reimbursement. Sabbaghzadeh is currently scheduled to be sentenced on Sept. 26, 2011; Bouche is currently scheduled to be sentenced on Nov. 17, 2011.
Donna Ocansey, 49, of Medford, N.J., was employed as a director of clinical services (supervising nurse) in Maxim’s Cherry Hill, N.J., office. She pleaded guilty on May 28, 2010, to making false statements relating to health care fraud matters. Ocansey, a registered nurse, had responsibility for, among other things, ensuring that Medicaid-required supervisory visits of patients were conducted periodically – meaning that a registered nurse periodically visited each patient to check each patient’s condition and the care the patient was receiving from Maxim Home Health Aides, who lack the skills and training of registered nurses. During her plea hearing, Ocansey acknowledged that she fabricated documentation in order to make it appear that other nurses had conducted Medicaid-mandated supervisory visits, when in fact they had not. Ocansey stated that she fabricated documentation in response to pressure from her superiors at Maxim, who expected her to make sure that all supervisory visits were completed without providing adequate resources for her to do so. Ocansey is currently scheduled to be sentenced Sept. 20, 2011.
Mary Shelly Janvier-Pierre, 42, of Lake Worth, Fla., and Sandy Cave, 39, of West Palm Beach, Fla., pleaded guilty to health care fraud on Feb. 1, 2010, and June 21, 2010, respectively. During their plea hearings, Janvier-Pierre, who had been employed by Maxim’s West Palm Beach office as a licensed practical nurse; and Cave, the mother of a former pediatric patient of Maxim, admitted to their roles in a scheme to fraudulently bill Medicaid through Maxim for services that were not rendered. Janvier-Pierre and Cave acknowledged that they agreed to submit billings as if Janvier-Pierre was taking care of Cave’s child, when in reality she was not. Janvier-Pierre and Cave then split the money Janvier-Pierre received for purportedly providing the care. As a result of the scheme, Maxim was paid more than $70,000 by Florida’s Medicaid program. Janvier-Pierre and Cave are scheduled to be sentenced on Sept. 21, 2011, and Oct. 24, 2011, respectively.
Marion Morton, 45, of North Charleston, S.C., was employed as a home health aide and personal care assistant by Maxim’s Charleston office. He pleaded guilty on May 3, 2010, to one count of making false statements relating to health care fraud matters. During his plea hearing, Morton acknowledged that, at the instruction of Maxim employees, he fabricated timecards reflecting work he had not done. On multiple occasions, Maxim submitted bills to Medicaid based on timecards which showed he worked more than 24 hours on certain days. Morton was sentenced on May 24, 2011, to a three-year term of probation and ordered to pay a $5,000 fine.
All of the defendants pleaded guilty before U.S. District Judge Anne E. Thompson in Trenton federal court.
The health care fraud charge to which Shipman, Sabbaghzadeh, Bouche, Janvier-Pierre and Cave pleaded guilty carries a maximum penalty of 10 years in prison and a maximum fine of $250,000, or twice the amount of loss caused by their offenses. The false statements relating to health care fraud matters charge to which defendants Munzel, Skaggs, Ocansey and Morton pleaded guilty carries a maximum penalty of five years in prison and a maximum fine of $250,000, or twice the amount of loss caused by their offenses.
Maxim’s Remedial Actions
The government’s willingness to enter into a DPA with Maxim is due, in significant part, to the company’s cooperation and the reforms and remedial actions the company has taken – beginning particularly in May 2009 – including significant personnel changes: terminating senior executives and other employees the company identified as responsible for the misconduct; establishing and filling of positions of chief executive officer, chief compliance officer, chief operations officer/chief clinical officer, chief quality officer/chief medical officer, chief culture officer, chief financial and strategy officer, and vice president of human resources; and hiring a new general counsel.
The company has identified and disclosed to law enforcement the misconduct of former Maxim employees, including providing information which has been critical in obtaining the convictions of some of the individuals who have pleaded guilty to date. The company has also significantly increased the resources allocated to its compliance program.
The settlement arises from a lawsuit filed under the False Claims Act. Under the qui tam, or whistleblower, provisions of the act, private citizens may file actions on behalf of the United States and share in any recovery. The whistleblower will receive approximately $15.4 million as his share of the recoveries from the federal government and the states.
The criminal complaint, DPA, civil settlement agreement and guilty pleas are the culmination of a multi-year investigation conducted jointly by special agents and investigators from HHS-OIG, under the direction of Special Agent in Charge ODonnell; FBI, under the direction of Special Agent in Charge Ward; and VA OIG, under the direction of Special Agent in Charge Hughes. The National Association of Medicaid Fraud Control Units (NAMFCU) and the Medicaid Fraud Control Units of the New Jersey, Virginia and Massachusetts Attorney General’s Offices also assisted in coordinating the settlements with the various states.”
FORMER EXEC. AT WASTE CLEANUP AND DISPOSAL CO. GETS 50 MONTHS FOR MONEY-LAUNDERING AND FRAUD
MONDAY, SEPTEMBER 12, 2011
The following is an excerpt from the Department of Justice website:
The following is an excerpt from the Department of Justice website:
GOVERNMENT JOINS LAWSUIT IN ALLEGED HOSPITAL/DOCTOR KICKBACK SCHEME
The following is an excerpt from the Department of Justice website:
Friday, September 9, 2011
U.S. Joined False Claims Act Lawsuit Against Florida’s Halifax Hospital Medical Center and Halifax Staffing Inc.
WASHINGTON – The United States has partially intervened in a lawsuit under the False Claims Act against Halifax Hospital Medical Center and Halifax Staffing Inc. in the U.S. District Court for the Middle District of Florida, the Department of Justice announced today.
The government partially intervened with respect to allegations that Halifax, which is located in Daytona Beach, Fla., violated the Stark law, which prohibits a hospital from billing Medicare for services referred by physicians that have an improper financial relationship with the hospital. The United States alleges that Halifax’s contracts with three neurosurgeons and six medical oncologists were improper, in part, because they either paid physicians more than fair market value, were not commercially reasonable or took into consideration the volume or value of the physicians’ referrals.
“Improper financial arrangements between hospitals and physicians threaten patient safety because personal financial considerations, instead of what's best for the patient, can influence the type of health care that is provided,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “The department is committed to preventing kickbacks that can corrupt the integrity of health care delivery.”
“The Stark law was enacted to prevent financial ties between a physician and an entity providing health care services from influencing the level of care provided to a patient,” said Robert E. O’Neill, U.S. Attorney for the Middle District of Florida. “By bringing cases such as this one, we hope to ensure that precious health care resources are not being wasted as a result of questionable financial relationships between health care providers.”
The lawsuit was initially filed in July 2009 by Elin Baklid-Kunz, currently employed at Halifax Staffing as the director of physician services, under the whistleblower provisions of the False Claims Act. Those provisions authorize private parties to sue on behalf of the United States, and permit the United States to intervene and take over the lawsuit. The whistleblower is entitled to receive a portion of any recovery. In this case, the United States elected to intervene in only a portion of the allegations asserted by Ms. Baklid-Kunz.”
Friday, September 9, 2011
U.S. Joined False Claims Act Lawsuit Against Florida’s Halifax Hospital Medical Center and Halifax Staffing Inc.
WASHINGTON – The United States has partially intervened in a lawsuit under the False Claims Act against Halifax Hospital Medical Center and Halifax Staffing Inc. in the U.S. District Court for the Middle District of Florida, the Department of Justice announced today.
The government partially intervened with respect to allegations that Halifax, which is located in Daytona Beach, Fla., violated the Stark law, which prohibits a hospital from billing Medicare for services referred by physicians that have an improper financial relationship with the hospital. The United States alleges that Halifax’s contracts with three neurosurgeons and six medical oncologists were improper, in part, because they either paid physicians more than fair market value, were not commercially reasonable or took into consideration the volume or value of the physicians’ referrals.
“Improper financial arrangements between hospitals and physicians threaten patient safety because personal financial considerations, instead of what's best for the patient, can influence the type of health care that is provided,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “The department is committed to preventing kickbacks that can corrupt the integrity of health care delivery.”
“The Stark law was enacted to prevent financial ties between a physician and an entity providing health care services from influencing the level of care provided to a patient,” said Robert E. O’Neill, U.S. Attorney for the Middle District of Florida. “By bringing cases such as this one, we hope to ensure that precious health care resources are not being wasted as a result of questionable financial relationships between health care providers.”
The lawsuit was initially filed in July 2009 by Elin Baklid-Kunz, currently employed at Halifax Staffing as the director of physician services, under the whistleblower provisions of the False Claims Act. Those provisions authorize private parties to sue on behalf of the United States, and permit the United States to intervene and take over the lawsuit. The whistleblower is entitled to receive a portion of any recovery. In this case, the United States elected to intervene in only a portion of the allegations asserted by Ms. Baklid-Kunz.”
GERMAN SHIPPING COMPANY TO PAY $800,000 FINE FOR COVERING UP OIL POLLUTION
The following is an excerpt from the Department of Justice website:
Thursday, September 8, 2011
"WASHINGTON – Uniteam Marine Shipping GmbH, a German corporation, was sentenced in federal court in San Juan, Puerto Rico, for violating the Act to Prevent Pollution from Ships (APPS) and making false statements to the U.S. Coast Guard, announced Assistant Attorney General Ignacia S. Moreno and U.S. Attorney Rosa Emilia Rodriguez-Velez.
The company was sentenced to pay an $800,000 criminal penalty, to include a $200,000 payment to the National Fish and Wildlife Foundation to fund a community service project in the District of Puerto Rico. In addition, the company was placed on three years of supervised probation and will have to implement a comprehensive advanced training and verification program to continuously monitor vessel operations and train crewmembers to prevent pollution from any ship it operates.
“ The Department of Justice will continue to prosecute shipping companies who break the laws that protect our oceans,” said Assistant Attorney General Moreno. “The penalty imposed by this sentence not only holds Uniteam Marine fully accountable for violating the Act to Prevent Pollution from Ships, but also will fund projects that rehabilitate damaged marine ecosystems in Puerto Rico.”
Uniteam Marine Shipping GmbH operated a 16,800 ton, 603 foot ocean going container ship named the M/V CCNI Vado Ligure that was engaged in global commercial trade. On May 10, 2010, the U.S. Coast Guard in San Juan, conducted an inspection of the vessel and discovered an excessive amount of oil in the discharge lines of the vessel’s oil water separator, a pollution prevention device designed to prevent the discharge of oily waste. When the device is operated properly, there should be no oil in the discharge lines. Subsequent investigation revealed that from Jan. 8, 2010, until May 10, 2010, the crew on the vessel manipulated the oil water separator so that is failed to function properly and allowed the illegal discharge of oily bilge wastes directly into the ocean.
All discharges of oil or oily bilge waste from a vessel are required to be recorded in the vessel’s oil record book. However, none of the illegal discharges were recorded in the oil record book for the M/V CCNI Vado Ligure.
“This sentence should serve as an eye opener to vessel owners and operators that choose to violate federal and international environmental laws that destroy our marine environment," said Capt. Drew W. Pearson, Sector San Juan Commander. "The U.S. Coast Guard is committed to protecting the maritime environment and works closely with our dedicated interagency partners and the U.S. Department of Justice to bring criminal environmental offenders to justice. This outcome would not have been possible without the outstanding investigative efforts and professionalism put forth by Sector San Juan pollution investigators and the Coast Guard Investigative Service who worked diligently with Department of Justice prosecutors to properly resolve this case.”
“Because we live on an island, the sea is without a doubt one of our most precious resources. This case should send a strong message that the Department of Justice and the United States Attorney’s Office will prosecute any entity which pollutes our environment to the fullest extent allowed by the law,” said Rosa Emilia Rodríguez-Vélez, U.S. Attorney for the District of Puerto Rico.
The National Fish and Wildlife Foundation will receive $200,000 to fund projects aimed at the restoration of marine and aquatic resources in the District of Puerto Rico, including projects intended to protect and rehabilitate marine mammals and their habitat, including manatees.
During the period of probation, Uniteam will be required to implement an advanced training and verification program which will ensure that any ship operated by Uniteam complies with all maritime environmental requirements established under applicable international, flag state, and port state laws. The program ensures that Uniteam’s employees and the crew of any vessel operated by Uniteam are properly trained in preventing maritime pollution. An independent monitor will report to the court about Uniteam’s compliance with its obligations during the period of probation."
Thursday, September 8, 2011
"WASHINGTON – Uniteam Marine Shipping GmbH, a German corporation, was sentenced in federal court in San Juan, Puerto Rico, for violating the Act to Prevent Pollution from Ships (APPS) and making false statements to the U.S. Coast Guard, announced Assistant Attorney General Ignacia S. Moreno and U.S. Attorney Rosa Emilia Rodriguez-Velez.
The company was sentenced to pay an $800,000 criminal penalty, to include a $200,000 payment to the National Fish and Wildlife Foundation to fund a community service project in the District of Puerto Rico. In addition, the company was placed on three years of supervised probation and will have to implement a comprehensive advanced training and verification program to continuously monitor vessel operations and train crewmembers to prevent pollution from any ship it operates.
“ The Department of Justice will continue to prosecute shipping companies who break the laws that protect our oceans,” said Assistant Attorney General Moreno. “The penalty imposed by this sentence not only holds Uniteam Marine fully accountable for violating the Act to Prevent Pollution from Ships, but also will fund projects that rehabilitate damaged marine ecosystems in Puerto Rico.”
Uniteam Marine Shipping GmbH operated a 16,800 ton, 603 foot ocean going container ship named the M/V CCNI Vado Ligure that was engaged in global commercial trade. On May 10, 2010, the U.S. Coast Guard in San Juan, conducted an inspection of the vessel and discovered an excessive amount of oil in the discharge lines of the vessel’s oil water separator, a pollution prevention device designed to prevent the discharge of oily waste. When the device is operated properly, there should be no oil in the discharge lines. Subsequent investigation revealed that from Jan. 8, 2010, until May 10, 2010, the crew on the vessel manipulated the oil water separator so that is failed to function properly and allowed the illegal discharge of oily bilge wastes directly into the ocean.
All discharges of oil or oily bilge waste from a vessel are required to be recorded in the vessel’s oil record book. However, none of the illegal discharges were recorded in the oil record book for the M/V CCNI Vado Ligure.
“This sentence should serve as an eye opener to vessel owners and operators that choose to violate federal and international environmental laws that destroy our marine environment," said Capt. Drew W. Pearson, Sector San Juan Commander. "The U.S. Coast Guard is committed to protecting the maritime environment and works closely with our dedicated interagency partners and the U.S. Department of Justice to bring criminal environmental offenders to justice. This outcome would not have been possible without the outstanding investigative efforts and professionalism put forth by Sector San Juan pollution investigators and the Coast Guard Investigative Service who worked diligently with Department of Justice prosecutors to properly resolve this case.”
“Because we live on an island, the sea is without a doubt one of our most precious resources. This case should send a strong message that the Department of Justice and the United States Attorney’s Office will prosecute any entity which pollutes our environment to the fullest extent allowed by the law,” said Rosa Emilia Rodríguez-Vélez, U.S. Attorney for the District of Puerto Rico.
The National Fish and Wildlife Foundation will receive $200,000 to fund projects aimed at the restoration of marine and aquatic resources in the District of Puerto Rico, including projects intended to protect and rehabilitate marine mammals and their habitat, including manatees.
During the period of probation, Uniteam will be required to implement an advanced training and verification program which will ensure that any ship operated by Uniteam complies with all maritime environmental requirements established under applicable international, flag state, and port state laws. The program ensures that Uniteam’s employees and the crew of any vessel operated by Uniteam are properly trained in preventing maritime pollution. An independent monitor will report to the court about Uniteam’s compliance with its obligations during the period of probation."
Sunday, September 11, 2011
CONSTRUCTION BUSINESS PREPARED FALSE EMPLOYER QUARTERLY FEDERALTAX RETURN
The following excerpt is from the Department of Justice website:
Tuesday, September 6, 2011
Miami Construction Business Owner Pleads Guilty to Tax Fraud
WASHINGTON – Braynert Marquez of Miami pleaded guilty to a one-count information charging him with aiding and assisting in the preparation and filing of a false employment tax return, the Justice Department and the Internal Revenue Service (IRS) announced today.
According to the plea agreement and information, Marquez operated and at least partly owned two Dade County, Fla., construction companies known as Bema Block Corp. and Bema Group Corp. From 2004 through 2007, Marquez paid employees of Bema Block and Bema Group “off-the-books” wages in two different ways. First, from late 2006 through 2007, Marquez obtained cash to pay his employees by causing Bema Block and Bema Group corporate checks to be issued to DJ Construction Group Inc. DJ Construction was a shell corporation created by others for use in the check cashing scheme. DJ Construction did no actual work for either Bema Block or Bema Group. Marquez caused the checks to be cashed at a check cashing store that was aware of the arrangement. Marquez then caused his employees to be paid with the cash from the checks. In 2007, $698,848.82 in Bema Block and Bema Group checks were written to DJ Construction and cashed to pay employees. Marquez failed to report the cash wages on quarterly employment tax returns and failed to withhold and pay over employment taxes on the wages.
According to court documents, Marquez also caused certain Bema Block employees to be paid with two checks: one payroll check from which the employment taxes were withheld and an additional check with no taxes withheld. The additional check was issued not from Bema Block, but from one of two corporations, MFCM Group Corporation and MJMF Group Corporation, created by Marquez and others solely for this purpose. From 2004 through 2007, Marquez caused approximately $664,535 in checks from MFCM Group and at least $469,049 in checks from MJMF Group to be written to Bema Block employees. Marquez failed to report the wages paid by these checks on quarterly employment tax returns and failed to withhold and pay over employment taxes on the wages.
According to the information, Marquez willfully aided and assisted in the preparation and presentation to the IRS of a false Employer’s Quarterly Federal Tax Return (IRS Form 941) for the calendar quarter ending Dec. 31, 2010. The tax return falsely and fraudulently reported $130,021 in wages, tips and other compensation by Bema Group Corp. to its employees that quarter.
The court scheduled sentencing for Nov. 3, 2011. Marquez faces a maximum of three years in prison, a maximum of one year of supervised release and a fine of $250,000. As part of his plea agreement, Marquez agreed that the United States suffered an employment tax loss of at least $200,000 but not more than $400,000 and he agreed to pay restitution to the IRS in the amount of $280,362.”
Tuesday, September 6, 2011
Miami Construction Business Owner Pleads Guilty to Tax Fraud
WASHINGTON – Braynert Marquez of Miami pleaded guilty to a one-count information charging him with aiding and assisting in the preparation and filing of a false employment tax return, the Justice Department and the Internal Revenue Service (IRS) announced today.
According to the plea agreement and information, Marquez operated and at least partly owned two Dade County, Fla., construction companies known as Bema Block Corp. and Bema Group Corp. From 2004 through 2007, Marquez paid employees of Bema Block and Bema Group “off-the-books” wages in two different ways. First, from late 2006 through 2007, Marquez obtained cash to pay his employees by causing Bema Block and Bema Group corporate checks to be issued to DJ Construction Group Inc. DJ Construction was a shell corporation created by others for use in the check cashing scheme. DJ Construction did no actual work for either Bema Block or Bema Group. Marquez caused the checks to be cashed at a check cashing store that was aware of the arrangement. Marquez then caused his employees to be paid with the cash from the checks. In 2007, $698,848.82 in Bema Block and Bema Group checks were written to DJ Construction and cashed to pay employees. Marquez failed to report the cash wages on quarterly employment tax returns and failed to withhold and pay over employment taxes on the wages.
According to court documents, Marquez also caused certain Bema Block employees to be paid with two checks: one payroll check from which the employment taxes were withheld and an additional check with no taxes withheld. The additional check was issued not from Bema Block, but from one of two corporations, MFCM Group Corporation and MJMF Group Corporation, created by Marquez and others solely for this purpose. From 2004 through 2007, Marquez caused approximately $664,535 in checks from MFCM Group and at least $469,049 in checks from MJMF Group to be written to Bema Block employees. Marquez failed to report the wages paid by these checks on quarterly employment tax returns and failed to withhold and pay over employment taxes on the wages.
According to the information, Marquez willfully aided and assisted in the preparation and presentation to the IRS of a false Employer’s Quarterly Federal Tax Return (IRS Form 941) for the calendar quarter ending Dec. 31, 2010. The tax return falsely and fraudulently reported $130,021 in wages, tips and other compensation by Bema Group Corp. to its employees that quarter.
The court scheduled sentencing for Nov. 3, 2011. Marquez faces a maximum of three years in prison, a maximum of one year of supervised release and a fine of $250,000. As part of his plea agreement, Marquez agreed that the United States suffered an employment tax loss of at least $200,000 but not more than $400,000 and he agreed to pay restitution to the IRS in the amount of $280,362.”
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