DAIRY COMPANY RESOLVES SEX AND RACE DISCRIMINATION CHARGES

FROM:  U.S. JUSTICE DEPARTMENT 
New Jersey dairy company to pay nearly $325,000 to settle charges 
of sex and race discrimination affecting 227 job applicants

MOUNTAINSIDE, N.J. — The U.S. Department of Labor's Office of Federal Contract Compliance Programs today announced that federal contractor Cream-O-Land Dairy Inc. has resolved claims of sex and race discrimination affecting 227 workers who applied for jobs at the company's dairy plant in Florence, N.J. An OFCCP review of the facility determined that the dairy company used a hiring process that violated Executive Order 11246 because it discriminated against women, African Americans and Asian Americans who applied for warehouse positions in 2010.

"I am pleased that we were able to reach a fair settlement in this case," said OFCCP Director Patricia A. Shiu. "Today's agreement underscores the notion that federal contractors, like Cream-O-Land, should closely examine their employment policies and practices to identify and eliminate any unfair barriers to equal opportunity.

Under the terms of the conciliation agreement, Cream-O-Land will pay $324,288 in back wages, interest and benefits to the rejected applicants. The company will also make 24 job offers to the affected class members as positions become available. Additionally, the company has agreed to undertake extensive self-monitoring measures, including committing a minimum of $10,000 for training to ensure that all of its hiring processes comply with the law.

Cream-O-Land Dairy Inc. delivers dairy products to grocery stores, supermarkets and schools throughout New Jersey, New York, Pennsylvania, Delaware and Connecticut. In Fiscal Year 2012, Cream-O-Land sold more than $1.5 million worth of products to federal agencies such as the Federal Prison System, Department of Veterans Affairs, Defense Commissary Agency, Defense Logistics Agency and Department of the Army.

In addition to Executive Order 11246, OFCCP enforces Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans' Readjustment Assistance Act of 1974. These three laws require those who do business with the federal government, contractors and subcontractors, to follow the fair and reasonable standard that they not discriminate in employment on the basis of sex, race, color, religion, national origin, disability or status as a protected veteran.

JUSTICE, PROPERTY DEVELOPER AGREE TO SETTLEMENT RELATED TO ACCESSIBILITY BARRIERS

FROM:  U.S. JUSTICE DEPARTMENT 
Thursday, December 19, 2013

Justice Department Announces Fair Housing Settlement with W.V. Developer
The Justice Department announced today that developer Douglas Pauley and entities affiliated with him have agreed to pay $110,000 and make all retrofits required to remove accessibility barriers at 30 apartment complexes, involving more than 750 units, in West Virginia that were developed through the federal government’s Low-Income Housing Tax Credit program.   The parties’ agreement will settle the United States’ claims that defendants violated the Fair Housing Act by building the complexes with a variety of features that made them inaccessible to persons with disabilities.

Under the terms of the parties’ agreement, Pauley, as general partner of 30 limited liability partnerships, must take extensive actions to make the complexes accessible to persons with disabilities.   These corrective actions include replacing cabinets in bathrooms and kitchens to provide sufficient room for wheelchair users, reducing door threshold heights, replacing excessively sloped portions of sidewalks and installing properly sloped curb ramps that allow persons with disabilities access to sidewalks from the parking areas.   In addition, the defendants will pay $100,000 to establish a settlement fund for the purpose of compensating disabled individuals impacted by the accessibility violations and $10,000 as a civil penalty.

“The Fair Housing Act protects the rights of persons with disabilities to have equal opportunities to enjoy the housing of their choice,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division .  “The Justice Department is strongly committed to the enforcement of the fair housing laws.   It is especially important that multi-family properties developed using federal programs are designed to provide accessible and affordable housing to those who need it the most.”

“When developers and building professionals fail to design and construct homes with the required accessibility features, we will vigorously enforce the law," said U.S. Attorney R. Booth Goodwin for the Southern District of West Virginia.

Individuals who are entitled to share in the settlement fund will be identified through a process established in the settlement.  Notices of the settlement and a list of subject properties will be published in the Charleston Gazette.

USING BACTERIA TO CLEAN UP TOXIC WASTE IN CALIFORNIA

U.S. SUES HIBACHI GRILL & BUFFET TO RECOVER ALMOST $2 MILLION IN UNPAID WAGES

FROM:  U.S. LABOR DEPARTMENT 

Hibachi Grill & Supreme Buffet sued by US Labor Department 
to recover nearly $2 million in unpaid wages and damages for 84 employees

JONESBORO, Ga. — The U.S. Department of Labor has filed a lawsuit against Wang's Partner Inc., doing business as Hibachi Grill & Supreme Buffet in Jonesboro, and its owner, Shu Wang, to recover unpaid wages and damages under, Fair Labor Standards Act. The department is seeking $1,997,726 in back wages and liquidated damages for 84 employees. The lawsuit is based on an investigation by the department's Wage and Hour Division, which revealed numerous violations of the FLSA. The lawsuit has been filed by the department's Office of the Solicitor in the U.S. District Court for the Northern District of Georgia.

Investigators from the division's Atlanta district office found that the employer misclassified servers as independent contractors, failed to pay servers and kitchen staff at least the federal minimum wage of $7.25 per hour and failed to pay overtime compensation at time and one-half employees' regular rates for hours worked beyond 40 in a work week. Additionally, the employer did not maintain accurate records of hours worked and wages paid.

"The U.S. Department of Labor is committed to ensuring that all workers receive the wages to which they are legally entitled," said Secretary of Labor Thomas E. Perez. "We will not stand by while employers use business models that hurt workers, their families and law-abiding employers. This lawsuit illustrates that the department will use every enforcement tool necessary to resolve cases where employees are unlawfully treated as independent contractors, and vulnerable workers are not paid the minimum wage."

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular rates, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week. In general, "hours worked" includes all time an employee must be on duty, or on the employer's premises or at any other prescribed place of work, from the beginning of the first principal work activity to the end of the last principal activity of the workday. Additionally, the law requires that accurate records of employees' wages, hours and other conditions of employment be maintained.
The misclassification of workers as something other than employees, such as independent contractors, presents a serious problem for affected employees, employers and to the entire economy. Misclassified employees are often denied access to critical benefits and protections, such as family and medical leave, overtime, minimum wage and unemployment insurance. Employee misclassification also generates substantial losses to state and federal treasuries, and to the Social Security and Medicare funds, as well as to state unemployment insurance and workers compensation funds.

COMPANY TO PAY ALMOST $400,000 IN WORKER CLASSIFICATION CASE

FROM:  U.S. LABOR DEPARTMENT 
Norwood Commercial Contractors agrees to pay nearly $400,000 in back wages and damages to 96 workers following U.S. Labor Department investigation

Del Amo Cleanup

U.S. GOVERNMENT INTERVENES IN PHYSICIAN SERVICES OVERBILLING LAWSUIT

FROM:  U.S. JUSTICE DEPARTMENT 
Monday, December 9, 2013
Government Intervenes in False Claims Lawsuit Against Ipc the Hospitalist Co. Inc. Alleging Overbilling of Physician Services

The government has intervened in a lawsuit against IPC The Hospitalist Co. Inc., and its subsidiaries (IPC), alleging that IPC submitted false claims to federal health care programs, the Justice Department announced today.  IPC, based in North Hollywood, Calif., is one of the largest providers of hospitalist services in the United States, employing physicians and other health care providers who work in more than 1,300 facilities in 28 states.  Hospitalists are physicians who work only in hospitals and other long-term care facilities, overseeing and coordinating inpatient care from admission to discharge.

The lawsuit alleges that IPC physicians sought payment for higher and more expensive levels of medical service than were actually performed – a practice commonly referred to as “upcoding.”  Specifically, the lawsuit alleges that IPC encouraged its physicians to bill at the highest levels regardless of the level of service provided, trained physicians to use higher level codes and encouraged physicians with lower billing levels to “catch up” to their peers.

“We continue to be vigilant in our enforcement efforts to ensure that health care programs funded by the taxpayers pay only for appropriate costs,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.

The lawsuit was filed by Dr. Bijan Oughatiyan, a former IPC physician, under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue for false claims on behalf of the government and to share in any recovery.  The Act also allows the government to intervene or take over the lawsuit, as it has done in this case, and to recover three times its damages plus civil penalties.  The government has asked the U.S. District Court in Chicago for 120 days to file its own complaint stating its allegations.

This intervention illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered a total of more than $17 billion through False Claims Act cases, with more than $12.2 billion of that amount recovered in cases involving fraud against federal health care programs.

The case was investigated by the Commercial Litigation Branch, Civil Division, U.S. Department of Justice and the U.S. Attorney’s Office for the Northern District of Illinois, with assistance from the Department of Health and Human Services Office of Inspector General.

The case is captioned United States ex rel. Oughatiyan v. IPC The Hospitalist Company Inc., et al., Civ. No. 09 C 5418 (N.D. Ill.).  The claims asserted against IPC are allegations only; there has been no determination of liability.

NEARLY 35,000 REFUNDS SENT OUT TO VICTIMS OF AUTOMATED ELECTRONIC CHECKING INC.

FROM:  U.S. FEDERAL TRADE COMMISSION 

FTC Sends Refunds to Consumers Victimized by Automated Electronic Checking Inc.

Thousands of consumers scammed out of their money will get some of it back, thanks to a lawsuit and settlement secured by the Federal Trade Commission.  The FTC  is mailing 34,859 refund checks to consumers whose bank accounts were debited, allegedly without their consent, by Nevada-based payment processor Automated Electronic Checking Inc. (AEC).

The average amount of redress will be about $25 and will be based on the amount each person lost.  A total of more than $870,000 is being returned to consumers.  Those who receive the checks from the FTC’s refund administrator should cash them within 60 days of the mailing date.  The FTC never requires consumers to pay money or to provide information before refund checks can be cashed.  Those with questions should call the refund administrator, Analytics Consulting LLC, at 1-855-529-6824, or visit www.FTC.gov/refunds for more general information.

Using a relatively new payment method called “remotely created payment orders” to give merchants access to consumer bank accounts, AEC debited many consumers who had never heard of AEC or its client merchants, some of whom included online discount shopping clubs and payday loan sites.  Under a settlement, AEC was banned from payment processing and required to pay a monetary judgment.

The FTC’s case against AEC is part of efforts by the Consumer Protection Working Group of President Obama’s Financial Fraud Enforcement Task Force.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad.

GOVERNMENT JOINT RELEASE BY AGENCIES IMPLEMENTING THE VOLCKER RULE

FROM:  COMMODITIES FUTURES TRADING COMMISSION 
Joint Release:
Board of Governors of the Federal Reserve System
Commodity Futures Trading Commission
Federal Deposit Insurance Corporation
Office of the Comptroller of the Currency
Securities and Exchange Commission

Release: 6790-13
For Release: December 10, 2013

Agencies Issue Final Rules Implementing the Volcker Rule

Five federal agencies on Tuesday issued final rules developed jointly to implement section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Volcker Rule”).

The final rules prohibit insured depository institutions and companies affiliated with insured depository institutions (“banking entities”) from engaging in short-term proprietary trading of certain securities, derivatives, commodity futures and options on these instruments, for their own account. The final rules also impose limits on banking entities’ investments in, and other relationships with, hedge funds or private equity funds.

Like the Dodd-Frank Act, the final rules provide exemptions for certain activities, including market making, underwriting, hedging, trading in government obligations, insurance company activities, and organizing and offering hedge funds or private equity funds. The final rules also clarify that certain activities are not prohibited, including acting as agent, broker, or custodian.

The compliance requirements under the final rules vary based on the size of the banking entity and the scope of activities conducted. Banking entities with significant trading operations will be required to establish a detailed compliance program and their CEOs will be required to attest that the program is reasonably designed to achieve compliance with the final rule. Independent testing and analysis of an institution’s compliance program will also be required. The final rules reduce the burden on smaller, less-complex institutions by limiting their compliance and reporting requirements. Additionally, a banking entity that does not engage in covered trading activities will not need to establish a compliance program.

The Federal Reserve Board announced on Tuesday that banking organizations covered by section 619 will be required to fully conform their activities and investments by July 21, 2015.

DOL SAYS WHISTLEBLOWERS CAN FILE COMPLAINTS WITH OSHA ONLINE

FROM:  U.S. LABOR DEPARTMENT 
Whistleblowers can now file complaints online with OSHA
Agency launches online form to provide workers a new way to file retaliation complaints

WASHINGTON — Whistleblowers covered by one of 22 statutes administered by the U.S. Department of Labor's Occupational Safety and Health Administration will now be able to file complaints online. The online form will provide workers who have been retaliated against an additional way to reach out for OSHA assistance online.

"The ability of workers to speak out and exercise their rights without fear of retaliation provides the backbone for some of American workers' most essential protections," said Assistant Secretary of Labor for Occupational Safety and Health Dr. David Michaels. "Whistleblower laws protect not only workers, but also the public at large and now workers will have an additional avenue available to file a complaint with OSHA."

Currently, workers can make complaints to OSHA by filing a written complaint or by calling the agency's 1-800-321-OSHA (6742) number or an OSHA regional or area office. Workers will now be able to electronically submit a whistleblower complaint to OSHA by visiting www.osha.gov/whistleblower/WBComplaint.html.
The new online form prompts the worker to include basic whistleblower complaint information so they can be easily contacted for follow-up. Complaints are automatically routed to the appropriate regional whistleblower investigators. In addition, the complaint form can also be downloaded and submitted to the agency in hard-copy format by fax, mail or hand-delivery. The paper version is identical to the electronic version and requests the same information necessary to initiate a whistleblower investigation.

OSHA enforces the whistleblower provisions of 22 statutes protecting employees who report violations of various securities laws, trucking, airline, nuclear power, pipeline, environmental, rail, public transportation, workplace safety and health, and consumer protection laws. Detailed information on employee whistleblower rights, including fact sheets and instructions on how to submit the form in hard-copy format, is available online at www.whistleblowers.gov.

Under the Occupational Safety and Health Act of 1970, employers are responsible for providing safe and healthful workplaces for their employees. OSHA's role is to ensure these conditions for America's working men and women by setting and enforcing standards, and providing training, education and assistance.

COMPANY AND OWNER SUED BY GOVERNMENT FOR DEFRAUDING BUSINESS ZONE PROGRAM

FROM:  U.S. JUSTICE DEPARTMENT 
Thursday, December 5, 2013

Government Files Suit Against Canton, Ohio-based Tab Construction and Its Owner for Allegedly Defrauding the Historically Underutilized Business Zone Program

The government has filed a complaint against Canton, Ohio-based TAB Construction Co. Inc. (TAB) and its owner, William E. Richardson III, for allegedly making false statements to the Small Business Administration (SBA) to obtain certification as a Historically Underutilized Business Zone (HUBZone) company, the Justice Department announced today.

 “The HUBZone program is intended to create jobs in areas that historically have had trouble attracting business,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.  “The Justice Department will take strong enforcement action when companies obtain contracts to which they are not entitled.”

 The government alleges that TAB used its fraudulently procured HUBZone certification to obtain four U.S. Army Corps of Engineers’ construction contracts worth millions of dollars.  Each of those contracts had been set aside for qualified HUBZone companies.  The government’s complaint asserts claims against TAB and Richardson under the False Claims Act and the Financial Institutions Reform, Recovery and Enforcement Act of 1989.

 Allegedly, Richardson originally applied to the HUBZone program in 2000 by claiming that TAB’s principal office was located in a designated HUBZone when no TAB employees worked out of the HUBZone office, and TAB actually was located in a non-HUBZone.  Even though Richardson told the SBA that TAB was located in a HUBZone, Richardson consistently used his non-HUBZone address in conducting TAB’s other business affairs, at one point even stating under oath in private litigation that TAB’s office was located in a non-HUBZone.  In 2006, Richardson allegedly applied for re-certification to the HUBZone program, again falsely stating that eight employees worked in the designated HUBZone.  The government alleges that just six weeks after Richardson re-certified its eligibility with the SBA, TAB completed an affidavit in an unrelated matter, which stated that TAB’s principal office was located in a non-HUBZone.

 Under the HUBZone program, companies that maintain their principal office in a designated HUBZone, and meet certain other requirements, can apply to the SBA for certification as a HUBZone small business company.  HUBZone companies can then use this certification when bidding on government contracts.  In certain cases, government agencies will restrict competition for a contract to HUBZone-certified companies.

 “We will not tolerate fraud in the HUBZone or any other SBA program,” said SBA Inspector General Peggy E. Gustafson.  “With our interagency partners, this office will continue to pursue those who defraud the government by lying to gain access to federal set-aside contracts.”

 “SBA’s contracting programs, including the HUBZone program, provide small businesses with the opportunity to grow and create jobs,” said SBA General Counsel Sara D. Lipscomb.  “SBA has no tolerance for waste, fraud or abuse in any government contracting program and is committed to working with our federal partners to ensure the benefits of these programs flow to the intended recipients.”

 The government filed its complaint in two consolidated lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act.  Under the Act, a private citizen can sue on behalf of the government and share in any recovery.  The government also is entitled to intervene in the lawsuit, as it has done in this case.

 This matter was handled by the Commercial Litigation Branch of the Justice Department’s Civil Division in conjunction with the Small Business Administration’s Office of Inspector General and Office of General Counsel and the Defense Criminal Investigative Service.

 The consolidated civil cases are U.S. ex rel. Roy. J. Fairbrother Jr. and Louis Petit v. TAB Construction Co. Inc., et al., No. 5:11-cv-1432 (N.D. Ohio) and U.S. ex rel. Patricia Hopson and Vince Pavkov v. TAB Construction Co. Inc., No. 5:12-cv-135 (N.D. Ohio).  The claims asserted against TAB and Richardson are allegations only, and there has been no determination of liability.

OSHA CITES COMPANY FOR SAFETY VIOLATION RELATED TO WORKER'S HEAT STROKE DEATH

FROM:  U.S. LABOR DEPARTMENT 
Aldridge Electric cited by US Labor Department's OSHA
after heat-related death of worker in Chicago
Employee became ill on his first day on the job

CHICAGO — The U.S. Department of Labor's Occupational Safety and Health Administration has cited Aldridge Electric Inc. for one serious safety violation following the June 25 death of a 36-year-old worker who developed heat stroke at a job site in Chicago. The company was installing electrical conduit in an uncovered trench on the Chicago Transit Authority's Dan Ryan Red Line project when the worker became ill on his first day on the job.

"This worker died from heat stress on his first day on the job. This tragedy underscores the need for employers to ensure that new workers become acclimated and build a tolerance to working in excessive heat with a program of water, rest and shade," said Dr. David Michaels, assistant secretary of labor for occupational safety and health. "A worker's first day on the job shouldn't be the last day of their life."

OSHA's investigation found that Aldridge Electric did not implement an adequate and effective heat stress program and failed to ensure a newly employed worker was acclimatized to effects of heat and physical exertion. The worker was carrying heavy electrical conduit piping in nonshaded conditions when he collapsed on the job site. He died from his illness the following day.
The serious violation was cited for failing to implement an adequate and effective heat stress program. A serious violation occurs when there is substantial probability that death or serious physical harm could result from a hazard about, which the employer knew or should have known.

Proposed penalties total $7,000. Aldridge Electric, based in Libertyville, Ill., is a specialty electrical contractor that employs nearly 750 workers nationwide. The company has 15 business days from receipt of the citations and penalties to comply, request an informal conference with OSHA's area director or contest the findings before the independent Occupational Safety and Health Review Commission.

SEC ALLEGES WEATHERFORD INTERNATIONAL AUTHORIZED BRIBES TO FOREIGN OFFICIALS

FROM:  SECURITIES AND EXCHANGE COMMISSION 
SEC Charges Weatherford International with FCPA Violations

The Securities and Exchange Commission today charged oilfield services company Weatherford International with violating the Foreign Corrupt Practices Act (FCPA) by authorizing bribes and improper travel and entertainment for foreign officials in the Middle East and Africa to win business, including kickbacks in Iraq to obtain United Nations Oil-for-Food contracts.

The SEC alleges that Weatherford and its subsidiaries falsified its books and records to conceal not only these illicit payments, but also commercial transactions with Cuba, Iran, Syria, and Sudan that violated U.S. sanctions and export control laws. Weatherford failed to establish an effective system of internal accounting controls to monitor risks of improper payments and prevent or detect misconduct. The company reaped more than $59.3 million in profits from business obtained through improper payments, and more than $30 million in profits from its improper sales to sanctioned countries.

Swiss-based Weatherford, which has substantial operations in Houston, has agreed to pay more than $250 million to settle the SEC’s charges and parallel actions by the Department of Justice’s Fraud Section, U.S. Attorney’s Office for the Southern District of Texas, Department of Commerce’s Bureau of Industry and Security, and Department of Treasury’s Office of Foreign Assets Control.

According to the SEC’s complaint filed in federal court in Houston, the misconduct occurred from at least 2002 to 2011. In Angola, for example, Weatherford’s legal department permitted its subsidiary to use an agent who insisted that an FCPA clause be omitted from the consultancy agreement. The company took no steps to determine whether the agent was paying bribes to foreign officials, and the agent used sham work orders and invoices to pay bribes that ensured the renewal of a lucrative oil services contract for Weatherford in Angola. The same agent made illicit payments to obtain commercial contracts for Weatherford in Congo. The company also allowed its subsidiary to enter into a joint venture agreement with companies whose beneficial owners included Angolan oil company officials and a relative of an Angolan Minister in order to win business. A Weatherford employee reported in a 2006 ethics questionnaire that Weatherford personnel were making payments to government officials in Angola and elsewhere, but the company failed to investigate.

The SEC’s complaint also alleges that Weatherford failed to perform due diligence on a distributor suggested by an official at a national oil company in the Middle East. From 2005 to 2011, Weatherford and its subsidiaries awarded more than $11.8 million in improper “volume discounts” to the distributor – money intended for the creation of a slush fund to pay foreign officials.

According to the SEC’s complaint, the misconduct went beyond the use of agents or other third parties. Weatherford provided improper travel and entertainment to officials of a state-owned company in Algeria with no legitimate business purpose. For example, Weatherford paid for a 2006 FIFA World Cup trip by two of the officials, the July 2006 honeymoon of an official’s daughter, and an October 2005 religious trip to Saudi Arabia by an official and his family that was improperly recorded as a donation in Weatherford’s books and records. Weatherford’s Middle East subsidiary also made more than $1.4 million in improper payments to obtain nine contracts under the Oil-for-Food program in 2002. Iraqi ministries demanded improper “inland transportation fees” in an effort to subvert the UN program. Weatherford’s subsidiary complied with the Iraqi demands and paid more than $115,000 in fees despite invoices that included charges inconsistent with the actual deliveries. Weatherford obtained more than $7 million in profits from the misconduct.

The SEC further alleges that managers at Weatherford’s subsidiary in Italy flouted the lack of internal controls and misappropriated more than $200,000 in company funds, some of which was improperly paid to Albanian tax auditors. The managers misreported cash advances, diverted payments on previously paid invoices, misappropriated government rebate checks, and received reimbursement for such purchases as golf equipment and perfume that did not relate to business activities.

According to the SEC’s complaint, Weatherford employees created false accounting and inventory records from 2002 to 2007 to hide the illegal commercial sales to Cuba, Syria, Sudan, and Iran. During this time period, exporting or re-exporting goods or services from the U.S. to these sanctioned countries was prohibited. The falsified financial statements and books and records of Weatherford subsidiaries involved in the misconduct were consolidated into the financial statements of the parent company.

The SEC’s complaint alleges that Weatherford violated the anti-bribery, books and records, and internal accounting controls provisions of the FCPA, specifically Sections 30A, 13(b)(2)(A), and 13(b)(2)(B) of the Securities Exchange Act of 1934. Weatherford agreed to pay $90,984,844 in disgorgement, $4,399,423.34 in pre-judgment interest, and a $1.875 million civil penalty assessed in part for lack of cooperation during the investigation. $31,646,907 of the payment to the SEC will be satisfied by Weatherford’s agreement to pay an equal amount to the U.S. Attorney’s Office. Weatherford agreed to pay $87 million in criminal fines to the Department of Justice for the FCPA violations, and $100 million to the other three agencies for the sanctions violations. The company also must comply with certain undertakings, including the retention of an independent compliance monitor for 18 months and self-reporting to the SEC staff for an additional 18 months.

The SEC’s investigation, which is continuing, has been conducted by Tracy L. Price, Kelly G. Kilroy, and Stanley Cichinski of the FCPA Unit as well as Natalie Lentz and Robert Dodge. The SEC appreciates the assistance of the Justice Department, Commerce Department, Treasury Department, and U.S. Attorney’s Office in Houston.

JUSTICE TRIES TO INTERVENE IN TAX PREPARATION WEBSITE ACCESSIBILITY LAWSUIT

FROM:  U.S. JUSTICE DEPARTMENT 
Monday, November 25, 2013

Justice Department Seeks to Intervene in Lawsuit Alleging H&R Block’s Tax Preparation Website Is Inaccessible to Individuals with Disabilities
The Civil Rights Division and U.S. Attorney Carmen Ortiz announced today that they have moved to intervene in National Federation of the Blind et al v. HRB Digital LLC et al, a private lawsuit alleging disability discrimination by HRB Digital LLC and HRB Tax Group Inc., subsidiaries of H&R Block Inc.  In the memorandum and proffered complaint filed by the United States in support of its motion to intervene, the United States alleges that the H&R Block companies discriminate against individuals with disabilities and that their website, www.hrblock.com , is being operated in violation of Title III of the Americans with Disabilities Act (ADA), notwithstanding well-established and readily available guidelines for delivering web content in an accessible manner.  The motion, attached complaint in intervention and supporting memorandum were filed in U.S. District Court for the District of Massachusetts’ Boston Division.

As alleged in the filings today, H&R Block is one of the largest tax return preparers in the United States.  Its companies offer a wide range of services through www.hrblock.com , including professional and do-it-yourself tax preparation, instructional videos, office location information, interactive live video conference and chat with tax professionals, hybrid online and in-store services and electronic filing.  Their website, however, is not accessible to many individuals with disabilities and prevents some people with disabilities from completing even the most basic activities on the site.

Today’s filings further state that many individuals with disabilities, including, among others, people who are blind, deaf or have physical disabilities with an impact on manual dexterity, use computers and the Internet with the help of assistive technologies.  For example, screen reader software makes audible information that is otherwise presented visually on a computer screen; captioning translates video narration and sound into text; and keyboard navigation allows keyboard input rather than a mouse to navigate a website for individuals with visual, hearing or manual dexterity disabilities.  Such technologies have been widely used for some time and there are readily available, well-established, consensus-based guidelines – the Web Content Accessibility Guidelines (WCAG) 2.0 – for making web content accessible to individuals with disabilities.

The complaint in intervention seeks a court order that would ensure that tax services offered through www.hrblock.com are fully and equally accessible to individuals with disabilities.  The department also seeks an award of monetary damages for aggrieved individuals, including the two named plaintiffs and a civil penalty to vindicate the public interest.

“The web revolutionizes our lives daily and maximizes our independence in many areas,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division.  “Inaccessible websites of public accommodations are not simply an inconvenience to individuals with disabilities – they deny persons with disabilities access to basic goods and services that people without disabilities take advantage of every day.  An inaccessible website can also mean a business loses a customer it never knew it had.”

“We are building an electronic world in which we ever-increasingly live,” said U.S. Attorney Carmen Ortiz for the District of Massachusetts.  “All benefit when, as the ADA requires, we build our online businesses, schools and other public spaces in a manner equally accessible to all.”

Title III of the ADA prohibits discrimination on the basis of disability by public accommodations in the full and equal enjoyment of the goods, services, facilities, privileges, advantages and accommodations.  It also requires public accommodations to take necessary steps to ensure individuals with disabilities are not excluded, denied services, segregated or otherwise treated differently because of the absence of auxiliary aids and services, such as accurate captioning of audible materials and labeling of visual materials.

TWO EXECUTIVES INDICTED IN AUTO PARTS PRICE FIXING CASE

FROM:  U.S. JUSTICE DEPARTMENT 
TWO EXECUTIVES INDICTED FOR ROLES IN FIXING PRICES
ON AUTOMOBILE PARTS SOLD TO TOYOTA
TO BE INSTALLED IN U.S. CARS

WASHINGTON — A Cleveland federal grand jury returned an indictment against two executives of a Japanese automotive supplier for their roles in an international conspiracy to fix prices of automotive anti-vibration rubber parts sold to Toyota and installed in U.S. cars, the Department of Justice announced today.

The indictment, filed yesterday in U.S. District Court for the Northern District of Ohio in Toledo, charges Masao Hayashi and Kenya Nonoyama, both Japanese nationals, with participating in a conspiracy to suppress and eliminate competition in the automotive parts industry by agreeing to allocate the supply of, to rig bids for and to fix, raise and maintain the prices of anti-vibration rubber parts sold to Toyota Motor Corp., Toyota Motor Engineering & Manufacturing North America Inc. and affiliated companies (collectively Toyota) for installation in automobiles manufactured and sold in the United States and elsewhere.

Automotive anti-vibration rubber products are comprised primarily of rubber and metal, and include engine mounts and suspension bushings.  They are installed in automobiles for the purpose of reducing road and engine vibration.

The indictment alleges, among other things, that from as early as March 1996 until at least December 2008, Hayashi and Nonoyama and their co-conspirators conducted meetings and communications in Japan to reach collusive agreements.  The indictment alleges that the conspiracy involved agreements affecting the Toyota Corolla, Avalon, Tacoma, Camry, Tundra, Sequoia, Rav4, Sienna, Venza and Highlander.

“Today’s indictment reaffirms the Antitrust Division’s commitment to hold executives accountable for actions that corrupt the competitive landscape and harm consumers,” said Renata B. Hesse, Deputy Assistant Attorney General for the Department of Justice’s Antitrust Division.  “The Antitrust Division continues to work closely with its fellow competition enforcers abroad to ensure that there are no safe harbors for executives who engage in international cartel crimes.”

Hayashi and Nonoyama are charged with a violation of the Sherman Act, which carries a maximum penalty of 10 years in prison and a $1 million criminal fine for individuals.  The maximum fine 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.

Including Hayashi and Nonoyama, 21 companies and 26 executives have been charged in the Justice Department’s ongoing investigation into the automotive parts industry.  To date, more than $1.6 billion in criminal fines have been obtained and seventeen of the charged executives have been sentenced to serve time in U.S. prisons or have entered into plea agreements calling for significant prison sentences.

The charges are the result of an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by each of the Antitrust Division’s criminal enforcement sections and the FBI.  Today’s charges were brought by the Antitrust Division’s Chicago Office and the FBI’s Cleveland Field Office, with the assistance of the FBI headquarters’ International Corruption Unit and the U.S. Attorney’s Office for the Northern District of Ohio.

DOJ ANNOUNCES NURSING HOME OPERATOR TO PAY $48 MILLION TO RESOLVE FALSE CLAIMS ACQUISITIONS

FROM:  U.S. JUSTICE DEPARTMENT 
Tuesday, November 19, 2013
Nursing Home Operator to Pay $48 Million to Resolve Allegations That Six California Facilities Billed for Unnecessary Therapy

The Ensign Group Inc., a skilled nursing provider based in Mission Viejo, Calif., that operates nursing homes across the western U.S. has agreed to pay $48 million to resolve allegations that it knowingly submitted to Medicare false claims for medically unnecessary rehabilitation therapy services, the Justice Department announced today.  Six of Ensign’s skilled nursing facilities in California allegedly submitted the false claims:  Atlantic Memorial Healthcare Center, located in Long Beach; Panorama Gardens, located in Panorama City; The Orchard Post-Acute Care (a.k.a. Royal Court), located in Whittier; Sea Cliff Healthcare Center, located in Huntington Beach; Southland, located in Norwalk; and Victoria Care Center, located in Ventura.

“Skilled nursing facilities that place their own financial interests above the needs of their patients will be held accountable,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery.  “We will continue to advocate for the appropriate use of Medicare funds and the proper care of our senior citizens.”

Between January 1, 1999, and August 31, 2011, these six Ensign skilled nursing facilities allegedly submitted false claims to the government for physical, occupational and speech therapy services provided to Medicare beneficiaries that were not medically necessary.  Specifically, Ensign provided therapy to patients whose conditions and diagnoses did not warrant it, solely to increase its reimbursement from Medicare.  The government further alleged that Ensign created a corporate culture that improperly incentivized therapists and others to increase the amount of therapy provided to patients to meet planned targets for Medicare revenue.  These targets were set without regard to patients’ individual therapy needs and could only be achieved by billing at the highest reimbursement levels.  The government also alleged that Ensign billed for inflated amounts of therapy it had not provided and that certain patients were kept in these facilities for periods of time exceeding what was medically necessary for treatment of their conditions.

“The case against The Ensign Group involves a company that regularly bilked Medicare by submitting inflated bills that, in some cases, sought money for services that simply were never provided to patients,” said U.S. Attorney for the Central District of California André Birotte Jr.  “This settlement – one of the largest Medicare fraud cases against a nursing home chain in U.S. history – demonstrates our commitment to protecting taxpayers who fund important programs that benefit millions of Americans, but don’t want to see their hard-earned money wasted on fraud or abuse.”

In addition to paying the settlement amount, Ensign also agreed that each of its skilled nursing facilities across the nation would be bound by the terms of a Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General (HHS-OIG).

"Billing Medicare for costly, unnecessary skilled nursing services -- as the government alleged here -- inflates health care costs borne by taxpayers," said Special Agent in Charge for the Los Angeles Region of the HHS-OIG Glenn R. Ferry.  “This settlement again puts on notice those who would consider defrauding federally funded health care programs."

This civil settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius.  The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation.  One of the most powerful tools in this effort is the False Claims Act.  Since January 2009, the Justice Department has recovered more than $16.7 billion through False Claims Act cases, with more than $11.9 billion of that amount recovered in cases involving fraud against federal health care programs.

The allegations settled today arose from lawsuits filed by two former Ensign therapists under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring suit on behalf of the government and to share in any recovery.  The dollar amount that the whistleblowers in this case, Gloria Patterson and Carol Sanchez, will receive has not been determined.  The lawsuits are captioned as United States of America ex rel. Gloria Patterson v. Ensign Group Inc., Case No. SACV 06-6956 CJC (ANx) (C.D. Calif.) and United States of America ex rel. Carol Sanchez v. Ensign Group Inc., Case No. SACV 06-0643 CJC (ANx) (C.D. Calif.).

The case was handled by the U.S. Attorney’s Office for the Central District of California, with assistance from the Commercial Litigation Branch, Civil Division, U.S. Department of Justice and the U.S. Department of Health and Human Services Office of Inspector General.  This action was supported by the Elder Justice and Nursing Home Initiative, which coordinates the department’s activities combating elder abuse, neglect and financial exploitation, especially as they impact beneficiaries of Medicare, Medicaid and other federal health care programs.

CARBON BLACK MANUFACTURER AGREES TO SPEND $84 MILLION TO CONTROL AIR POLLUTION

FROM:  U.S. JUSTICE DEPARTMENT 
Tuesday, November 19, 2013
Cabot Corporation Agrees to Spend Over $84 Million to Control Harmful Air Pollution at Louisiana and Texas Facilities

Boston-based Cabot Corporation, the second largest carbon black manufacturer in the United States, has agreed to pay a $975,000 civil penalty and spend an estimated $84 million on state of the art technology to control harmful air pollution, resolving alleged violations of the New Source Review (NSR) provisions of the Clean Air Act (CAA) at its three facilities in the towns of Franklin and Ville Platte, La., and Pampa, Texas, the Department of Justice and the U.S. Environmental Protection Agency (EPA) announced today.   This agreement is the first to result from a national enforcement initiative aimed at bringing carbon black manufacturers into compliance with the CAA’s NSR provisions.    

The state of Louisiana Department of Environmental Quality is a co-plaintiff in the case and will receive $292,500 of the penalty.

“By agreeing to pay an appropriate penalty and install state of the art technology to control harmful air pollution, Cabot Corp. is taking a positive step forward to address these alleged violations of the Clean Air Act,” said Acting Assistant Attorney General Robert G. Dreher of the Justice Department’s Environment and Natural Resources Division.  “This agreement will serve as a model for how the industry can come into compliance with the Clean Air Act by installing controls that prevent harmful pollution and improve air quality for surrounding communities.”

“With today’s commitment to invest in pollution controls, Cabot has raised the industry standard for environmental protection,” said Assistant Administrator Cynthia Giles of EPA’s Office of Enforcement and Compliance Assurance.  “These upgrades will have lasting, tangible impacts on improved respiratory health for local communities.  We expect others in the industry to take notice and realize their obligation to protect the communities in which they operate.”

“This is a huge win for the citizens of our district,” said U.S. Attorney Stephanie A. Finley.  “These harmful pollutants can cause serious, long term respiratory harm.  The United States Attorney’s Office is committed to the enforcement of the environmental laws and protection of the community.  This settlement promotes a healthier environment and an opportunity to allow the residents of the district to breathe cleaner air.”

At all three facilities, the settlement requires that Cabot optimize existing controls for particulate matter or soot, operate an “early warning” detection system that will alert facility operators to any particulate matter releases, and comply with a plan to control “fugitive emissions” which result from leaks or unintended releases of gases.   To address nitrogen oxide (NOx) pollution, Cabot must install selective catalytic reduction technology to significantly reduce emissions, install continuous monitoring, and comply with stringent limits.   At the two larger facilities in Louisiana, Cabot must address sulfur dioxide (SO2) pollution by installing wet gas scrubbers to control emissions, install continuous monitoring, and comply with stringent emissions limits.   In addition, the Texas facility is required to comply with a limit on the amount of sulfur in feedstock that is the lowest for any carbon black plant in the United States.

These measures are expected to reduce NOx emissions by approximately 1,975 tons per year, SO2 emissions by approximately 12,380 tons per year, and significantly improve existing particulate matter controls.  Exposure to NOx emissions can cause severe respiratory problems and contribute to childhood asthma.   SO2 and NOx can be converted to fine particulate matter once released in the air.  Fine particulates can be breathed in and lodged deep in the lungs, leading to a variety of health problems and even premature death.   The harmful health and environmental impacts from these pollutants can occur near the facilities as well as in communities far downwind from the plants.
       
In the complaint filed by DOJ on behalf of EPA, the government alleged that, between 2003 and 2009, Cabot made major modifications at its carbon black facilities without obtaining pre-construction permits and without installing and operating required pollution technology.  The complaint further alleges that these actions resulted in increased emissions of NOx and SO2, violating CAA requirements stating that companies must obtain the necessary permits prior to making modifications at a facility and must install and operate required pollution control equipment if those modifications will result in increases of certain pollutants.

Today’s action also requires that Cabot spend $450,000 on energy saving and pollution reduction projects that will benefit the communities surrounding the facilities in Franklin and Ville Platte, La., and in Pampa, Texas, such as upgrading air handling units at municipal buildings in the three communities to more efficient technology.  

Carbon black is a fine carbonaceous powder used as a structural support medium in tires and as a pigment in a variety of products such as plastic, rubber, inkjet toner and cosmetics.  It is produced by burning oil in a low oxygen environment; the oil is transformed into soot (carbon black), which is collected in a baghouse.  Because the oil used in the process is low value high sulfur oil, the manufacturing process creates significant amounts of SO2 and NOx, as well as particulate matter.

This settlement is part of EPA’s national enforcement initiative to control harmful air pollution from the largest sources of emissions.  Since 2010, EPA has been focusing enforcement efforts on reducing emissions at carbon manufacturing plants in the United States.  Currently, none of the 15 carbon black manufacturing plants located in the United States have controls on emissions of SO2 and NOx or have continuous emissions monitors.

DEFUNCT COMPANY AND OWNER TO PAY OVER $300.000 TO SETTLE WHISTLEBLOWER LAWSUIT

FROM:  U.S. DEPARTMENT OF LABOR

Judge orders North Canton-based Star Air, Akron Reserve Ammunition,
owner to pay more than $300,000 to 2 terminated Ohio truck drivers
Consent judgment resolves lawsuit filed by Department of Labor
NORTH CANTON, Ohio — Under terms of a consent judgment, a now defunct North Canton, Ohio-based company, Star Air Inc., and owner Robert R. Custer, will pay two Ohio truck drivers $302,000 to resolve a lawsuit filed by the U.S. Department of Labor for terminating two of the company's drivers in violation of the 1982 Surface Transportation Assistance Act's whistleblower provisions. Akron Reserve Ammunition Inc., was also named a defendant in the lawsuit because the department alleges that the company, which is owned by Custer, is the successor to Star Air.

"These drivers were fired for trying to protect themselves and the driving public," said Assistant Secretary of Labor for Occupational Safety and Health Dr. David Michaels. "No truck driver should be forced to drive while tired, sick or in violation of truck weight or hours-of-service requirements. OSHA will continue to defend America's truck drivers against unscrupulous employers who unlawfully retaliate against drivers who assert their right to drive safely."

The drivers were dismissed after one was stopped by West Virginia State Police and cited for: hauling an excess load without a commercial driver's license, operating an overweight trailer and driving without a logbook. The commercial vehicle also did not have the name of the company, its home base or its U.S. Department of Transportation number displayed. The driver who was cited informed another driver, who was also operating without the proper information displayed, and they refused to continue driving until these issues were resolved. Consequently, both were terminated.

Both drivers filed complaints with the Occupational Safety and Health Administration alleging that Star Air had discriminated against them in retaliation for activities protected by the STAA, and a Labor Department administrative law judge issued the order for reinstatement and back wages. Under automatic review provisions, the judge's decision then was referred to and upheld by the Administrative Review Board, which issues final decisions for the secretary of labor in cases arising under a wide range of worker protection laws.
The companies and Custer will pay the $302,000 agreed upon amount over a three-year period. If any party defaults on payments, the court can order the payment of the entire amount awarded in the judgment, which is $685,785.22. The U.S. District Court for the Northern District of Ohio, Eastern Division, in Akron made the ruling. The department is represented by its Regional Office of the Solicitor in Cleveland.

OSHA enforces the whistleblower provisions of the STAA and 21 other statutes protecting employees who report violations of various airline, commercial motor carrier, consumer product, environmental, financial reform, food safety, motor vehicle safety, health-care reform, nuclear, pipeline, public transportation agency, railroad, maritime and securities laws.

Under the various whistleblower provisions enacted by Congress, employers are prohibited from retaliating against employees who raise various protected concerns or provide protected information to the employer or the government. Employees who believe that they have been retaliated against for engaging in protected conduct may file a complaint with the secretary of labor for an investigation by OSHA's Whistleblower Protection Program.

NLRB Office of the General Counsel Authorizes Complaints against Walmart, Also Finds No Merit to Other Charges

NLRB Office of the General Counsel Authorizes Complaints against Walmart, Also Finds No Merit to Other Charges

FTC APPROVES MATTRESS SELLER SETTLEMENT REGARDING VOLATILE ORGANIC COMPOUNDS IN PRODUCTS

FROM:  U.S. FEDERAL TRADE COMMISSION 
FTC Approves Final Consents Settling Charges That Mattress Sellers Lacked Scientific Evidence to Prove Products Were Free From Volatile Organic Compounds

Following a public comment period, the Federal Trade Commission has approved final consent orders in three cases involving allegedly deceptive environmental claims for mattresses. The FTC’s complaints, first announced in July, 2013, against Relief-Mart, Inc.; Esssentia Natural Memory Foam Company, Inc.; and Ecobaby Organics, Inc., charged the companies with making unsupported claims that the mattresses they sell are free of harmful volatile organic compounds (VOCs).

The FTC also charged that two of the companies made unsupported claims that their mattresses were chemical-free and odorless.  The FTC also challenged one company’s claim that its mattresses are made from 100 percent natural materials, and another company’s claim that its mattresses were certified by an organic mattress organization.

In settling the Commission’s charges, the companies have agreed not to make similar claims in the future, unless they have competent and reliable scientific evidence to prove they are true. In addition, Ecobaby is barred from making misrepresentations about certifications.

The Commission vote to approve the final orders and, in the cases of Essentia and EcoBaby, to send letters to the public commenters, was 4-0.  (FTC File Nos. 122-3128, Relief-Mart; 122-3129, Ecobaby Organics; 122-3130, Essentia Natural Memory Foam Company; the staff contact is Robin Moore, Bureau of Consumer Protection, 202-326-2167; see press release dated July 25, 2013)

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them.  To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357).  The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad.  The FTC’s website provides free information on a variety of consumer topics.  Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

CALIFORNIA RESIDENT ORDERED TO PAY OVER $17 MILLION FOR ROLE IN FOREX FRAUD SCHEME

FROM:  U.S. COMMODITY FUTURES TRADING COMMISSION
Federal Court in Massachusetts Orders Lyndon Parrilla to Pay over $17 Million in Disgorgement, Restitution, and a Penalty in Forex Fraud Scheme

In a related criminal proceeding, Parrilla sentenced to 97 months in prison and ordered to pay restitution of more than $4.6 million

Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) obtained a federal court Order awarding restitution for defrauded customers, disgorgement, and a civil monetary penalty totaling more than $17 million against defendant Lyndon Parrilla, of California, in connection with an off-exchange foreign currency (forex) fraud scheme in which Parrilla and his company, Green Tree Capital (Green Tree), defrauded over 50 customers in the United States of over $4 million.

Judge Joseph L. Tauro of the U.S. District Court for the District of Massachusetts entered the final judgment and permanent injunction Order on October 24, 2013 (see Related Link), requiring Parrilla to pay restitution of $4,197,342 to defrauded customers, disgorgement of $3,353,925, and a $10 million civil monetary penalty. The Order also imposes permanent trading and registration bans against Parrilla and prohibits him from further violations of the Commodity Exchange Act (CEA) and CFTC regulations, as charged.

The Order stems from a CFTC Complaint filed on April 12, 2011, that charged Parrilla and Green Tree with fraud, misappropriation, and other CEA violations (see CFTC Press Release 6024-11). The court previously entered judgment against Green Tree on June 30, 2011.

The final judgment Order is based on the court’s findings set forth in an earlier Order, entered on September 30, 2013 (see Related Link), that finds that Parrilla and Green Tree fraudulently solicited over $4 million from at least 50 customers in the United States, from approximately October 2009 until April 2011, for the purported purpose of trading off-exchange forex contracts on a leveraged or margined basis in managed accounts.

In soliciting the funds, the Order finds that Parrilla, on behalf of Green Tree, misrepresented that Green Tree had a record of delivering consistently profitable returns when, in fact, it incurred trading losses since its inception, and almost 80 percent of customer funds was never traded or invested in any manner. In fact, according to the Order, Parrilla misappropriated over $3.3 million of customer funds to pay personal and entertainment expenses, including Las Vegas casino expenses, purchase automobiles and clothing, and ATM or cash withdrawals. To disguise these misrepresentations, trading losses, and misappropriations, Parrilla sent false Green Tree account statements to customers by email. Further, the Order finds that Parrilla misrepresented his experience and expertise, and failed to disclose that the National Futures Association (NFA) permanently barred him from NFA membership.

As a result of a parallel criminal action brought by the U.S. Attorney’s Office in November 2012, Parrilla was sentenced to, among other things, a term of 97 months imprisonment and ordered to pay restitution in the amount of $4,675,156.

The CFTC appreciates the assistance of the Federal Bureau of Investigation and the U.S. Attorney’s Office for the District of Massachusetts.

CFTC Division of Enforcement staff members responsible for this case are Alex C. Levine, David Chu, Lindsey Evans, Melissa Glasbrenner, Mary Beth Spear, Ava M. Gould, Scott Williamson, Rosemary Hollinger, and Richard B. Wagner.

JUSTICE ANNOUNCES OWNER OF MEDICAL CLINIC SENTENCED TO 15 YEARS IN PRISON FOR MEDICARE FRAUD

FROM:  U.S. JUSTICE DEPARTMENT 
Tuesday, November 12, 2013
Brooklyn Clinic Owner Sentenced for Role in $77 Million Medicare Fraud Scheme

The owner of a Brooklyn medical clinic was sentenced today to serve 15 years in prison for her leading role in a $77 million Medicare fraud scheme.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney for the Eastern District of New York Loretta E. Lynch, Assistant Director in Charge George Venizelos of the FBI’s New York Field Office, and Special Agent in Charge Thomas O’Donnell of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) made the announcement.

Irina Shelikhova, 50, of Brooklyn, was sentenced by U.S. District Judge Nina Gershon of the Eastern District of New York.  In addition to her prison term, Shelikhova was sentenced to serve three years of supervised release with a concurrent exclusion from Medicare, Medicaid and all Federal health programs, ordered to forfeit $36,241,545 and ordered to pay $50,943,386 in restitution.  Shelikhova has been in custody since her arrest at the John F. Kennedy International Airport on June 15, 2012, after living as a fugitive in Ukraine for nearly two years.  After serving her sentence, Shelikhova faces deportation from the United States.

Shelikhova pleaded guilty on Dec. 18, 2012, to one count of conspiracy to commit money laundering.  Including Shelikhova, 13 individuals have been convicted in this case.

Court documents state that from 2005 to 2010, Shelikhova owned and operated a clinic in Brooklyn that billed Medicare under three corporate names: Bay Medical Care PC, SVS Wellcare Medical PLLC and SZS Medical Care PLLC (collectively, Bay Medical clinic).  Shelikhova and her employees at the Bay Medical clinic paid cash kickbacks to Medicare beneficiaries and used the beneficiaries’ names to bill Medicare for more than $77 million in services that were medically unnecessary or never provided.  The defendants billed Medicare for a wide variety of fraudulent medical services and procedures, including physician office visits, physical therapy and diagnostic tests.

According to trial testimony, Shelikhova masterminded the health care fraud at the Bay Medical clinic, which included hiring a medically unlicensed co-defendant to impersonate the clinic’s doctor and render medical care to patients.  Shelikhova also directed employees to create phony medical notes in an attempt to back up the false billing and to forge doctors’ names on prescriptions and charts.

The government’s investigation included the use of a court-ordered audio/video recording device hidden in a room at the clinic, which showed conspirators paying cash kickbacks to corrupt Medicare beneficiaries.  The conspirators were recorded paying approximately $500,000 in cash kickbacks during a period of approximately six weeks from April to June 2010.  This room was marked “PRIVATE” and featured a Soviet-era poster of a woman with a finger to her lips and the words “Don’t Gossip” in Russian. The purpose of the kickbacks was to induce the beneficiaries to receive unnecessary medical services or to stay silent when services not provided to the patients were billed to Medicare.

To generate the large amounts of cash needed to pay the patients, Shelikhova directed the recruitment and operations of a network of external money launderers who cashed checks for the clinic.  Shelikhova wrote clinic checks payable to various shell companies controlled by the money launderers.  These checks did not represent payment for any legitimate service at or for the Bay Medical clinic, but rather were written to launder the clinic’s fraudulently obtained health care proceeds.  The money launderers cashed these checks and provided the cash back to the clinic.  Shelikhova used the cash to pay illegal cash kickbacks to the Bay Medical clinic’s purported patients.

The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York.  This case is being prosecuted by Trial Attorney Sarah M. Hall of the Fraud Section and Assistant U.S. Attorney Shannon Jones of the Eastern District of New York.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion.  In addition, HHS’s Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

CHECK CASHING COMPANY AND OWNER PLEAD GUILTY IN FRAUD CONSPIRACY

FROM:  U.S. JUSTICE DEPARTMENT 
Tuesday, November 5, 2013
New York Check Cashing Company and Owner Plead Guilty for Roles in $19 Million Scheme

Belair Payroll Services Inc. (Belair), a multi-branch check cashing company in Flushing, N.Y., and its owner, Craig Panzera, 47, pleaded guilty today for failing to follow reporting and anti-money laundering requirements for more than $19 million in transactions, in violation of the Bank Secrecy Act (BSA).   Panzera also pleaded guilty to conspiring to defraud the United States by willfully failing to pay income and payroll taxes.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Loretta Lynch of the Eastern District of New York, Acting Director John Sandweg of U.S. Immigration and Customs Enforcement (ICE), and Chief Richard Weber of the Internal Revenue Service Criminal Investigation (IRS-CI) made the announcement.

As part of the guilty plea, Belair will forfeit $3,267,252.10, and Panzera will pay restitution in the amount of $946,841.17 to the IRS.  Sentencing for Belair and Panzera will be determined at a later date.

According to court records, from in or about June 2009 through June 2011, certain individuals presented to Belair’s manager and other employees checks to be cashed at Belair.  The checks were written on accounts of shell corporations that appeared to be health care related, but in fact, the corporations did no legitimate business.  The shell corporations and their corresponding bank accounts on which the checks were written were established in the names of foreign nationals, many of whom were no longer in the United States.

Belair accepted these checks and provided cash in excess of $10,000 to the individuals. Panzera and others at Belair never obtained any identification documents or information from those individuals.  Belair filed currency transaction reports (CTRs) that falsely stated the checks were cashed by the foreign nationals who set up the shell corporations, and in certain CTRs, Belair failed to indicate the full amount of cash provided to the individuals.  The individuals cashed more than $19 million through Belair during the course of the scheme.  Panzera and Belair willfully failed to maintain an effective anti-money laundering program by cashing these checks.

The charges in the indictment against Panzera’s and Belair’s co-defendants remain pending and are merely accusations.  Those defendants are presumed innocent unless and until proven guilty.

The cases are being investigated by agents from ICE Homeland Security Investigations and IRS-CI.  These cases are being prosecuted by Trial Attorneys Claiborne W. Porter and Kevin G. Mosley of the Criminal Division’s Asset Forfeiture and Money Laundering Section’s (AFMLS) Money Laundering and Bank Integrity Unit, Trial Attorney Darrin McCullough of AFMLS’s Forfeiture Unit, and Assistant U.S. Attorney Patricia Notopoulos of the Eastern District of New York.

The Money Laundering and Bank Integrity Unit investigates and prosecutes complex, multi-district and international criminal cases involving financial institutions and individuals who violate the money laundering statutes, the Bank Secrecy Act and other related statutes.  The Unit’s prosecutions generally focus on three types of violators: financial institutions, including their officers, managers and employees, whose actions threaten the integrity of the individual institution or the wider financial system; professional money launderers and gatekeepers who provide their services to serious criminal organizations; and individuals and entities engaged in using the latest and most sophisticated money laundering techniques and tools.

GOVERNMENT ISSUES MINING FATALITY REPORT, SAYS MINERS DYING IN PREVENTABLE ACCIDENTS

FROM:  U.S. LABOR DEPARTMENT 
MSHA issues third-quarter 2013 fatality data
Nine miners lose their lives in a three-month period

ARLINGTON, Va. — The U.S. Department of Labor's Mine Safety and Health Administration today released a summary of U.S. mining deaths that occurred during the third quarter of 2013. From July 1 to Sept. 30, there were nine mining fatalities in the United States. Five miners died in coal mining accidents and four in metal/nonmetal mining accidents. The number was two fewer than during the third quarter in 2012.

Two coal miners died in machinery accidents, and one each died in powered haulage, fall of roof or rib, and drowning accidents. Two metal/nonmetal miners died in powered haulage accidents, and one each died in machinery and falling/sliding material accidents.

Twenty-seven miners died in mining accidents in 2013 from Jan. 1 through Sept. 30, compared to 30 from Jan. 1, 2012, through Sept. 30, 2012.

"While the number of mining deaths was lower than in the same period last year, miners continue to die in accidents that could have been prevented, such as by using proximity detection equipment," said Joseph A. Main, assistant secretary of labor for mine safety and health. On July 2, a continuous mining machine operator was killed when he was struck by a battery-powered coal hauler and pinned between the coal hauler and coal rib. Proximity detection systems can be programmed to send warning signals to alert miners to the presence of moving machinery and can stop the machinery before it strikes, pins or crushes a miner working in the vicinity. As of Sept. 30, 2013, 372 proximity detection systems had been installed on continuous mining machines, coal hauling machines and scoops in underground coal mines.

"In metal/nonmetal mining, fatalities continue to occur that could be prevented by using ‘lock out/tag out' best practices," said Main. "Two of the fatalities this quarter could have been avoided by: disconnecting the power, ensuring the miner on the job has locked the power source in the safe position and tagging to prevent the power from being re-energized.

"While actions undertaken by MSHA and the mining industry continue to move mine safety in the right direction, these deaths are a reminder that much more needs to be done to protect the nation's miners and ensure they return home after every shift," said Main.

COMPANY SETTLES CLAIMS IT STEERED WOMEN INTO LOWER PAYING JOBS

FROM:  U.S. LABOR DEPARTMENT 
G&K Services Co. settles claims of pay and hiring discrimination with the US Labor Department
Agreement includes $265,983 in back pay to 59 women steered into lower paying jobs

LOS ANGELES — G&K Services Co. has agreed to settle allegations that it discriminated against female laundry workers by steering them into lower-paying positions regardless of their qualifications. The conciliation agreement between the federal contractor's facility located in Santa Fe Springs, Calif., and the department's Office of Federal Contract Compliance Programs resolves this pay discrimination violation, as well as the related finding that the company discriminated against male applicants in hiring.

"The settlement reflects a mutual commitment between the department and the leadership of G&K Services Co. to ensure that qualified workers, irrespective of gender, have a fair shot at competing for good jobs," said OFCCP Director Patricia A. Shiu. "I am pleased by this contractor's willingness to work with us on a proactive strategy to guarantee that all their workers have an equal opportunity to succeed in the workplace."

During a compliance evaluation, OFCCP determined that G&K Services had a practice of assigning laundry workers to different tasks and different pay rates on the basis of gender. Specifically, OFCCP found that between July 1, 2009, and June 30, 2010, female employees who had been hired as general laborers were assigned to "light duty" jobs that paid less than the "heavy duty" jobs involving similar work and qualifications, which the company reserved for men. Denying women access to higher-paying opportunities because of sex stereotyping is a form of pay discrimination in violation of Executive Order 11246. Investigators also found that male applicants were frequently denied the option to compete for a majority of the open laborer opportunities during the review period because the company only considered them for so-called heavy duty work.

Under the terms of the agreement, the contractor will pay $265,983 in back wages to 59 female workers who were steered into the lower paying jobs. G&K Services will also extend to the 59 female class members job offers in the higher-paying laborer positions. In addition, G&K Services will pay $23,968 in back wages to 331 male job applicants who were denied the opportunity to compete for open lower-paying laborer positions and make three job offers. The company has also agreed to undertake extensive self-monitoring measures, and review and revise their hiring and pay practices, to ensure they fully comply with the law.
G&K Services provides textile leasing and renting services to a number of different government agencies, including the Defense Commissary Agency, Bureau of Reclamation and NASA.

In addition to Executive Order 11246, OFCCP enforces Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans' Readjustment Assistance Act of 1974. These three laws require those who do business with the federal government, both contractors and subcontractors, to follow the fair and reasonable standard that they not discriminate in employment on the basis of sex, race, color, religion, national origin, disability or status as a protected veteran.

ATTORNEY GENERAL HOLDER'S REMARKS ON JOHNSON & JOHNSON'S RESOLUTION OF CRIMINAL/CIVIL CLAIMS

FROM:  U.S. JUSTICE DEPARTMENT 

Attorney General Eric Holder Delivers Remarks at the Johnson & Johnson Press Conference

~ Monday, November 4, 2013

Good morning – and thank you all for being here.  I am joined by Associate Attorney General [Tony] West; Assistant Attorney General for the Civil Division [Stuart] Delery; U.S. Attorney for the Eastern District of Pennsylvania [Zane] Memeger; U.S. Attorney for the District of Massachusetts [Carmen] Ortiz; First Assistant U.S. Attorney for the Northern District of California [Brian] Stretch; and Deputy Inspector General for Investigations at the Department of Health and Human Services [Gary] Cantrell.

We are here to announce that Johnson & Johnson and three of its subsidiaries have agreed to pay more than $2.2 billion to resolve criminal and civil claims that they marketed prescription drugs for uses that were never approved as safe and effective – and that they paid kickbacks to both physicians and pharmacies for prescribing and promoting these drugs.  Through these alleged actions, these companies lined their pockets at the expense of American taxpayers, patients, and the private insurance industry.  They drove up costs for everyone in the health care system and negatively impacted the long-term solvency of essential health care programs like Medicare.

This global settlement resolves multiple investigations involving the antipsychotic drugs Risperdal and Invega – as well as the heart drug Natrecor and other Johnson & Johnson products.  The settlement also addresses allegations of conduct that recklessly put at risk the health of some of the most vulnerable members of our society – including young children, the elderly, and the disabled.

In the criminal information filed today, we allege that Johnson & Johnson subsidiary Janssen Pharmaceuticals Incorporated violated the Federal Food, Drug, and Cosmetic Act by introducing Risperdal into the market for unapproved uses.  In its plea agreement, Janssen admits that it promoted this drug to health care providers for the treatment of psychotic symptoms and associated behaviors exhibited by elderly, non-schizophrenic patients who suffered from dementia – even though the drug was approved only to treat schizophrenia.

In separately filed civil complaints, we further allege that both Johnson & Johnson and Janssen Pharmaceuticals promoted Risperdal and Invega to doctors – and to nursing homes – as a way to control behavioral disturbances in elderly dementia patients, children, and the mentally disabled.  The companies allegedly downplayed the serious health risks associated with Risperdal – including the risk of stroke in elderly patients – and even paid doctors to induce them to prescribe the drugs.  As part of this scheme, the companies allegedly paid kickbacks to the nation’s largest long-term care pharmacy, whose pharmacists were supposed to be the gatekeepers to provide an independent review of patient medications.  Instead, at the companies’ behest, the pharmacists allegedly recommended Risperdal for nursing home patients who exhibited behavioral symptoms associated with Alzheimer’s Disease and dementia.  This alleged conduct resulted in government health care programs paying millions of dollars in false claims for these drugs.

To resolve allegations stemming from the improper promotion of Risperdal, Janssen Pharmaceuticals will plead guilty to misbranding Risperdal – and has agreed to pay $400 million in criminal fines and forfeitures.  Johnson & Johnson and Janssen Pharmaceuticals have further agreed to pay over $1.2 billion to resolve their civil liability under the False Claims Act.  And Johnson & Johnson will pay an additional $149 million to resolve claims relating to alleged kickbacks to a long-term care pharmacy.
In addition to these claims, we allege that Johnson & Johnson and its subsidiary, Scios Incorporated, promoted the heart failure drug Natrecor for off-label uses that caused patients to submit to costly infusions of the drug – without credible scientific evidence that it would have any health benefit for those patients.  In a separate matter that was resolved in 2009, Scios pleaded guilty to misbranding Natrecor and paid a criminal fine of $85 million.  To resolve current allegations associated with the settlement we announce today, the companies have agreed to pay an additional $184 million.

This significant settlement was made possible by the relentless investigative and enforcement efforts of dedicated men and women serving as part of the Health Care Fraud Prevention and Enforcement Action Team – or, HEAT – which Health and Human Services Secretary Kathleen Sebelius and I launched more than four years ago to recover taxpayer dollars, to keep the American people safe, and to aggressively pursue fraud and misconduct whenever and wherever it is found.

Put simply, this alleged conduct is shameful and it is unacceptable.  It displayed a reckless indifference to the safety of the American people.  And it constituted a clear abuse of the public trust, showing a blatant disregard for systems and laws designed to protect public health.

As our filings make clear, these are not victimless crimes.  Americans trust that the medications prescribed for their parents and grandparents, for their children, and for themselves are selected because they are in the patient’s best interest.  Laws enacted by Congress – and the enforcement efforts of the Food and Drug Administration – provide important safeguards to ensure that drugs are approved for uses that have been demonstrated as safe and effective.  Efforts by drug companies to introduce their drugs into interstate commerce for unapproved uses subvert those laws.  Likewise, the payment of kickbacks undermines the independent medical judgment of health care providers.  It creates financial incentives to increase the use of certain drugs, potentially putting the health of some patients at risk.  Every time pharmaceutical companies engage in this type of conduct, they corrupt medical decisions by health care providers, jeopardize the public health, and take money out of taxpayers’ pockets.

This settlement demonstrates that the Departments of Justice and Health and Human Services – working alongside a variety of federal, state, and local partners – will not tolerate such activities.  No company is above the law.  And my colleagues and I are determined to keep moving forward – guided by the facts and the law, and using every tool, resource, and authority at our disposal – to hold these corporations accountable, to safeguard the American people, and to prevent this conduct from happening in the future.
This announcement marks another step forward in our strategic, comprehensive, and effective approach to fraud prevention.  We can all be encouraged by the actions that have been taken – and the results we’ve obtained – in recent years.  But we cannot yet be satisfied.  And that’s why, here in Washington and across the country, this critical work will continue.

I’d like to thank everyone who made this settlement possible.  In particular, I want to recognize the leaders, prosecutors, trial attorneys, investigators, and staff of the Civil Division here in Washington – as well as our United States Attorney’s Offices in Philadelphia, Boston, and San Francisco.  I am grateful for the committed efforts of our partners at the Department of Health and Human Services – particularly in the Office of the Inspector General – as well as the Food and Drug Administration and many other federal agencies that contributed to this outcome.  And I want to thank each of the state Attorneys General and Medicaid Fraud Control units across this country who contributed to this investigation.
I would be happy to take a few questions at this time.

CONTRACTOR IN DC AREA WILL PAY $875,000 TO 381 MINORITY APPLICANTS

FROM:  U.S. LABOR DEPARTMENT 
DC-area construction contractor to pay $875,000 to settle discrimination case with US Labor Department
Nearly 400 minority applicants to receive back wages as company reviews hiring practices

DULLES, Va. — The U.S. Department of Labor today announced that federal construction contractor M.C. Dean Inc. has settled allegations that it failed to provide equal employment opportunity to 381 African American, Hispanic and Asian American workers who applied for jobs at the company's Dulles headquarters. A review by the department's Office of Federal Contract Compliance Programs determined that the contractor used a set of selection procedures, including invalid tests, which unfairly kept qualified minority candidates from securing jobs as apprentices and electricians.

"Our nation was built on the principles of fair play and equal opportunity, and artificial barriers that keep workers from securing good jobs violate those principles," said OFCCP Director Patricia A. Shiu. "I am pleased that this settlement will provide remedies to the affected workers and that M.C. Dean has agreed to invest significant resources to improve its hiring practices so that this never happens again."

Under the terms of the agreement, M.C. Dean will pay $875,000 in back wages and interest to 272 African American, 98 Hispanic and 11 Asian American job applicants who were denied employment in 2010. The contractor will also extend 39 job offers to the class members as opportunities become available. Additionally, M.C. Dean has agreed to undertake extensive self-monitoring measures and personnel training to ensure that all of its employment practices fully comply with Executive Order 11246, which prohibits federal contractors and subcontractors from discriminating in employment on the bases of race, color and national origin.

M.C. Dean is a construction, design-build and systems integration corporation with more than 30 offices worldwide. Since 2006, the company has held more than $600 million in contracts with federal agencies, including the U.S. Department of Defense.

In addition to Executive Order 11246, OFCCP enforces Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans' Readjustment Assistance Act of 1974. These three laws require those who do business with the federal government, contractors and subcontractors, to follow the fair and reasonable standard that they not discriminate in employment on the basis of sex, race, color, religion, national origin, disability or status as a protected veteran.

LABOR DEPARTMENT FILES WHISLTEBLOWER COMPLAINT SEEKING OVER $300,000 FOR FIRED EMPLOYEE

FROM:  U.S. LABOR DEPARTMENT 

US Labor Department seeks more than $300,000 for Idaho whistleblower
Clearwater Paper Corp. fired employee who filed an OSHA safety complaint
SEATTLE — The U.S. Department of Labor filed a whistleblower complaint in the U.S. District Court for the District of Idaho against Clearwater Paper Corp. in Lewiston, Idaho, for allegedly retaliating against an employee who raised workplace safety and health concerns.

The department's complaint alleges that a Clearwater Paper employee was fired in 2010 in retaliation for filing a safety complaint with the Occupational Safety and Health Administration's Boise Area Office. The employee was first suspended and then fired soon after OSHA conducted an inspection to assess excessive exposure to red cedar dust at Clearwater Paper's sawmill in Lewiston. This facility was later sold in 2011.

"Raising a workplace safety and health concern is a courageous act of good citizenship," said Assistant Secretary of Labor for Occupational Safety and Health Dr. David Michaels. "Not a single worker should fear harassment, intimidation or a disciplinary action for contributing to a safe and healthy workplace. Employees have the right to contact OSHA without fear of retaliation."
The department is seeking reinstatement of the employee as well as payment of more than $300,000 in damages and fees, including back pay, compensatory damages, emotional distress damages and punitive damages.
Clearwater Paper manufactures consumer paper products.

OSHA enforces the whistleblower provision of the OSH Act and 21 other statutes protecting employees who report violations of various securities, trucking, airline, nuclear, pipeline, environmental, public transportation, workplace safety and health, consumer product safety, health care reform and financial reform laws. Under these laws enacted by Congress, employers are prohibited from retaliating against employees who raise various protected concerns or provide protected information to the employer or to the government. Employees who believe that they have been retaliated against for engaging in protected conduct may file a complaint with the secretary of labor for an investigation by OSHA's Office of Whistleblower Protection Program.

APARTMENT COMPLEX SETTLES DISCRIMINATION OF DISABLED WITH ANIMAL ASSISTANTS CASE

FROM:  U.S. JUSTICE DEPARTMENT 
Monday, October 28, 2013
Justice Department Obtains $167,500 in Discrimination Settlement with Reno, Nev., Apartment Complex

The Justice Department announced today that the U.S. District Court of Nevada has approved a settlement in which the owners and operators of Rosewood Park Apartments, a 902 unit apartment complex in Reno, Nev., will pay $167,000 to resolve a lawsuit alleging discrimination against persons with disabilities who use assistance animals.

Under the agreement, the defendants in United States v. Rosewood Park LLC et al., will pay a total of $127,500 to a family that was not allowed to move into the complex because one of the members of the household used an assistance animal and to the Silver State Fair Housing Council, a non-profit Nevada organization that assisted the family and conducted testing to investigate the rental practices at Rosewood Park.  The defendants will also pay an additional $25,000 to compensate any other persons harmed by the defendants’ discriminatory policies, who are identified through a process established by the agreement, and will pay $15,000 to the government in civil penalties.  The agreement also requires that defendants adopt and maintain a new policy regarding assistance animals, provide non-discrimination training to their employees and agree to record keeping and monitoring requirements for the terms of the agreement.  The agreement has been approved by the U.S. District Court of Nevada, and takes the form of a consent order that can be enforced by the court.

The department’s complaint had alleged that the owners, employees and management company of Rosewood Park Apartments violated the Fair Housing Act by limiting individuals with certain assistance animals to a particular section of Rosewood Park Apartments; subjecting such individuals to pet fees; requiring assistance animals to be licensed or certified; and barring companion or uncertified service dogs altogether.  The case began when a family that had sought housing at Rosewood Park and the Silver State Fair Housing Council filed complaints with the Department of Housing and Urban Development (HUD).   HUD investigated the complaint, issued a charge of discrimination and referred the matter to the Department of Justice.

“The Fair Housing Act ensures that persons with disabilities searching for a home are protected from discrimination,” said Jocelyn Samuels, Acting Assistant Attorney General for the Civil Rights Division.  “The Justice Department will continue to vigorously protect the civil rights of persons with disabilities in Nevada and across the country.”

“Persons who think they have been discriminated against in housing issues should not hesitate to file a report with HUD,” said U.S. Attorney Bogden.  “The U.S. Attorney’s Office, as part of the U.S. Department of Justice, works with HUD to ensure that companies that are treating disabled persons unfairly are punished, and that they adopt policies to prevent further discrimination.”

“Assistance animals play a vital role in helping people with disabilities conduct everyday activities and fully enjoy their homes,” said Bryan Greene, HUD's Acting Assistant Secretary for Fair Housing and Equal Opportunity.  “HUD and DOJ will continue to enforce the Fair Housing Act's protections and ensure that housing providers do not illegally limit assistance animals.”

Fighting illegal housing discrimination is a top priority of the Justice Department.  The federal Fair Housing Act prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability.

OWNERS OF AMBULANCE COMPANY PLEAD GUILTY IN FRAUD SCHEME

FROM:  U.S. JUSTICE DEPARTMENT 
Tuesday, October 29, 2013

Owners and Supervisor of Ambulance Transportation Company Plead Guilty in Los Angeles for Role in Ambulance Fraud Scheme
The owners and supervisor of Alpha Ambulance Inc. (Alpha), a now-defunct Los Angeles-area ambulance transportation company, have pleaded guilty in connection with an ambulance fraud scheme.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney André Birotte Jr. of the Central District of California; Special Agent in Charge Glenn R. Ferry of the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); and Assistant Director in Charge Bill L. Lewis of the FBI’s Los Angeles Field Office made the announcement.

Alex Kapri, aka Alex Kapriyelov or Alexander Kapriyelov, 56; Aleksey Muratov, aka Russ Muratov, 32; and Danielle Hartsell Medina, 36, pleaded guilty on Oct. 28, 2013, before U.S. District Court Judge Audrey B. Collins in the Central District of California to conspiracy to commit health care fraud.  They face a maximum penalty of 10 years in prison when they are sentenced on Feb. 24, 2014.

Kapri and Muratov were owners and operators of Alpha, an ambulance transportation company that operated in the greater Los Angeles area and that specialized in the provision of non-emergency ambulance transportation services to Medicare-eligible beneficiaries, primarily dialysis patients.  Medina was employed by Alpha and ultimately supervised the training and education of its employees.

According to court documents, Kapri, Muratov and Medina knowingly provided non-emergency ambulance transportation services to Medicare beneficiaries whose medical condition at that time did not require those services.  With Kapri’s knowledge, Muratov and Medina instructed certain Alpha employees to conceal the Medicare beneficiaries’ medical conditions by altering requisite paperwork and creating fraudulent reasons that justified, on paper, the transportation services.  Based on these medically unnecessary transportation services, the defendants caused Alpha to submit false and fraudulent claims to Medicare.

Additionally, as the defendants were submitting false and fraudulent claims to Medicare, Medicare notified Alpha the company would be subject to a Medicare audit.  In response to this notice, Muratov and Medina instructed Alpha employees – with Kapri’s knowledge – to alter requisite paperwork and create fraudulent reasons that justified, on paper, transportation services for the beneficiaries identified as the subject of Medicare’s audit.

From at least June 2008 through at least July 2012, Alpha submitted more than $49 million in claims for ambulance transportation services.  As a result, Medicare paid Alpha more than $13 million for these claims, many of which were false and fraudulent.

The case was investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California.  This case was prosecuted by Trial Attorneys Blanca Quintero and Alexander F. Porter and Assistant Chief O. Benton Curtis III.
                       
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,500 defendants who have collectively billed the Medicare program for more than $5 billion.  In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.