Two More Defendants Plead Guilty in Multimillion Dollar India-Based Call Center Scam Targeting U.S. Victims

Friday, July 7, 2017

An Arizona man and an Illinois woman each pleaded guilty to conspiracy charges today for their respective roles in liquidating and laundering victim payments generated through a massive telephone impersonation fraud and money laundering scheme perpetrated by India-based call centers.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Abe Martinez of the Southern District of Texas, Executive Associate Director Peter T. Edge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), Inspector General J. Russell George of the U.S. Treasury Inspector General for Tax Administration (TIGTA) and Inspector General John Roth of the U.S. Department of Homeland Security Office of Inspector General (DHS-OIG) made the announcement.

Bhavesh Patel, 47, most recently residing in Gilbert, Arizona, pleaded guilty to money laundering conspiracy, in violation of Title 18, U.S. Code, Section 1956(h). Asmitaben Patel, 34, most recently residing in Willowbrook, Illinois, pleaded guilty to a conspiracy to commit fraud and money laundering offenses, in violation of Title 18, U.S. Code, Section 371.  The pleas were entered before U.S. District Court Judge David Hittner of the Southern District of Texas. Sentencing dates are pending.

According to admissions made in connection with their respective pleas, Bhavesh Patel, Asmitaben Patel, and their co-conspirators perpetrated a complex scheme in which individuals from call centers located in Ahmedabad, India, impersonated officials from the IRS and U.S. Citizenship and Immigration Services (USCIS), and engaged in other telephone call scams, in a ruse designed to defraud victims located throughout the U.S. Using information obtained from data brokers and other sources, call center operators targeted U.S. victims who were threatened with arrest, imprisonment, fines or deportation if they did not pay alleged monies owed to the government. Victims who agreed to pay the scammers were instructed how to provide payment, including by purchasing stored value cards or wiring money. Upon payment, the call centers would immediately turn to a network of “runners” based in the U.S. to liquidate and launder the fraudulently-obtained funds.

According to Bhavesh Patel’s guilty plea, beginning in or around January 2014, Bhavesh Patel managed the activities of a crew of runners, directing them to liquidate victim scam funds in areas in and around south and central Arizona per the instructions of conspirators from India-based call centers. Patel communicated via telephone about the liquidation of scam funds with both domestic and India-based co-defendants, and he and his crew used reloadable cards containing funds derived from victims by scam callers to purchase money orders and deposit them into various bank accounts as directed, in return for percentage-based commissions from his India-based co-defendants. Patel also admitted to receiving and using fake identification documents, including phony driver’s licenses, to retrieve victim scam payments in the form of wire transfers, and providing those fake documents to persons he managed for the same purpose.

Based on admissions in Asmitaben Patel’s guilty plea, beginning in or around July 2013, Asmitaben Patel served as a runner liquidating victim scam funds as part of a group of conspirators operating in and around the Chicago area. At the direction of a co-defendant, Patel used stored value cards that had been loaded with victim funds to buy money orders and deposit them into various bank accounts, including the account of a lead generating business in order to pay the company for leads it provided to co-conspirators that were ultimately used to facilitate the scam.

To date, Bhavesh Patel, Asmitaben Patel, 54 other individuals and five India-based call centers have been charged for their roles in the fraud and money laundering scheme in an indictment returned by a federal grand jury in the Southern District of Texas on Oct. 19, 2016. Including today’s pleas, a total of eleven defendants have pleaded guilty thus far in this case. Co-defendants Bharatkumar Patel, Ashvinbhai Chaudhari, Harsh Patel, Nilam Parikh, Hardik Patel, Rajubhai Patel, Viraj Patel, Dilipkumar A. Patel, and Fahad Ali previously pleaded guilty on various dates between April and June 2017.

The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

HSI, DHS-OIG and TIGTA led the investigation of this case. Also providing significant support were: the Criminal Division’s Office of International Affairs; Ft. Bend County, Texas, Sheriff’s Office; police departments in Hoffman Estates and Naperville, Illinois, and Leonia, New Jersey; San Diego County District Attorney’s Office Family Protection and Elder Abuse Unit; U.S. Secret Service; U.S. Small Business Administration, Office of Inspector General; IOC-2; INTERPOL Washington; USCIS; U.S. State Department’s Diplomatic Security Service; and U.S. Attorneys’ Offices in the Middle District of Alabama, Northern District of Alabama, District of Arizona, Central District of California, Northern District of California, District of Colorado, Northern District of Florida, Middle District of Florida, Northern District of Illinois, Northern District of Indiana, District of Nevada and District of New Jersey. The Federal Communications Commission’s Enforcement Bureau also provided assistance in TIGTA’s investigation.

Senior Trial Attorney Michael Sheckels and Trial Attorney Mona Sahaf of the Criminal Division’s Human Rights and Special Prosecutions Section, Trial Attorney Robert Stapleton of the Criminal Division’s Money Laundering and Asset Recovery Section and Assistant U.S. Attorneys S. Mark McIntyre and Craig M. Feazel of the Southern District of Texas are prosecuting the case.

A  Department of Justice website has been established to provide information about the case to already identified and potential victims and the public. Anyone who believes they may be a victim of fraud or identity theft in relation to this investigation or other telefraud scam phone calls may contact the Federal Trade Commission (FTC) via this website.

Anyone who wants additional information about telefraud scams generally, or preventing identity theft or fraudulent use of their identity information, may obtain helpful information on the IRS tax scams website, the FTC phone scam website and the FTC identity theft website.

Group of Owned and Affiliated Florida Hospitals Agree to Pay US $10.1 Million to Resolve False Claims Act Allegations

Tuesday, November 20, 2012
Group of Owned and Affiliated Florida Hospitals Agree to Pay US $10.1 Million to Resolve False Claims Act Allegations

Morton Plant Mease Health Care Inc. and its affiliated hospitals (Morton Plant) have agreed to pay $10,169,114 to the federal government to resolve allegations that they violated the False Claims Act by submitting false claims for services rendered to Medicare patients, the Justice Department announced today. Morton Plant owns and operates, or is affiliated with, Morton Plant Hospital, St. Joseph’s Hospital, Morton Plant North Bay Hospital, St. Anthony’s Hospital, Mease Countryside Hospital and Mease Dunedin Hospital. These hospitals are part of the BayCare Health System in Florida’s Pinellas, Hillsborough and Pasco counties.


The settlement announced today resolves allegations that, between July 1, 2006 and July 31, 2008, Morton Plant improperly billed for certain interventional cardiac and vascular procedures as inpatient care when those services should have been billed as less costly outpatient care or as observational status.


“Overbilling the government for routine procedures wastes valuable resources that could be used to care for other patients,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Justice Department’s Civil Division. “At a time when we are trying to reduce public spending, it is especially important to ensure that hospitals do not overcharge the government by improperly inflating their billing.”


“We hold medical providers to a high standard in our district, and we will not hesitate to hold them to account when we find evidence of serious misconduct,” said Robert O’Neill, U.S. Attorney for the Middle District of Florida. “This settlement should send a strong message that health care fraud enforcement is a growing priority in our office.”


Today’s settlement resolves a qui tam, or whistleblower, lawsuit filed by Randi Ferrare, a former director of Health Management Services at Morton Plant Hospital. Under the False Claims Act, private citizens, known as relators, can bring suit on behalf of the United States and

share in any recovery. Ms. Ferrare will receive over $1.8 million as her share of the government’s recovery.


“When hospitals attempt to boost profits with improper inpatient admissions, they squander scarce dollars from Medicare and Medicaid,” said Daniel R. Levinson, Inspector General of the Department of Health & Human Services. “Our corporate integrity agreements hold providers accountable for preventing such abuse of government health care programs.”

This resolution is part of the government’s emphasis on combating health care fraud and another step for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced by Attorney General Eric Holder and Kathleen Sebelius, Secretary of the Department of Health and Human Services in May 2009. 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 that effort is the False Claims Act, which the Justice Department has used to recover $10.1 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $13.8 billion


The United States’ investigation was conducted by the U.S. Attorney’s Office for the Middle District of Florida, the Civil Division of the Department of Justice, the FBI and the Department of Health and Human Services, Office of Inspector General.


The claims settled by this agreement are allegations only; there has been no determination of liability.


The case is docketed as United States ex rel. Randi Ferrare v. Morton Plant Mease Health Care, Inc., No. 08:cv:01689-T-266MSS (M.D. Fl.).

Former FBI Agent and Alleged Co-Conspirators Indicted for Scheme to Obstruct Federal Fraud Investigation

Thursday, October 18, 2012
Former FBI Agent and Alleged Co-Conspirators Indicted for Scheme to Obstruct Federal Fraud Investigation

WASHINGTON – A federal grand jury in Salt Lake City today returned an 11-count indictment charging a former FBI special agent and two alleged accomplices with a scheme to use the agent’s official position to derail a federal investigation into the conduct of one of the alleged conspirators.  The charges were announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, U.S. Attorney for the District of Utah David B. Barlow and Department of Justice Inspector General Michael E. Horowitz.

The indictment charges former FBI special agent Robert G. Lustyik Jr., 50, of Sleepy Hollow, N.Y.; Michael L. Taylor, 51, of Harvard, Mass., the principal of Boston-based American International Security Corporation (AISC); and Johannes W. Thaler, 49, of New Fairfield, Conn., each with one count of conspiracy, eight counts of honest services wire fraud, one count of obstructing justice and one count of obstructing an agency proceeding.

“According to the indictment, while active in the FBI, former Special Agent Lustyik used his position in an attempt to stave off the criminal investigation of a business partner with whom he was pursuing lucrative security and energy contracts,” said Assistant Attorney General Breuer.  “He allegedly acted through a childhood friend to secure promises of cash, purported medical expenses and business proceeds in exchange for abusing his position as an FBI agent.  The alleged conduct is outrageous, and we will do everything we can to ensure that justice is done in this case.”

DOJ Inspector General Horowitz stated:  “Law enforcement officers are sworn to uphold the law.  Agents who would sell their badges and impede the administration of justice will be vigorously pursued.”

According to the indictment, Robert Lustyik was an FBI special agent until September 2012, assigned to counterintelligence work in White Plains, N.Y.  The indictment also states that from at least June 2011, the three alleged conspirators had a business relationship involving the pursuit of contracts for security services, electric power and energy development, among other things, in the Middle East, Africa and elsewhere.

The indictment alleges that in September 2011, Taylor learned of a federal criminal investigation, begun in Utah in 2010, into whether Taylor, his business and others committed fraud in the award and performance of a contract with the U.S. Department of Defense.

Soon thereafter, Taylor allegedly began to give and offer things of value to Lustyik in exchange for Lustyik’s agreement to use his official position to impair and impede the Utah investigation.  The indictment also alleges that Thaler, a childhood friend of Lustyik’s, served as a conduit between Taylor and Lustyik, passing information and things of value.

Specifically, the indictment charges that Taylor offered Lustyik a $200,000 cash payment; money purportedly for the medical expenses of Lustyik’s minor child; and a share in the proceeds of several anticipated contracts worth millions of dollars.

According to the indictment, Lustyik used his official FBI position to impede the Utah investigation by, among other things, designating Taylor as an FBI confidential source, texting and calling the Utah investigators and prosecutors to dissuade them from charging Taylor and attempting to interview potential witnesses and targets in the Utah investigation.  As alleged in the indictment, Lustyik wrote to Taylor that he was going to interview one of Taylor’s co-defendants and “blow the doors off this thing.”  Referring to the Utah investigation, Lustyik also allegedly assured Taylor that he would not stop in his “attempt to sway this your way.”

According to the indictment, Lustyik, Taylor and Thaler attempted to conceal the full extent of Lustyik’s relationship with Taylor from the Utah prosecutors and agents, including by making and planning to make material misrepresentations and omissions to federal law enforcement involved in the investigation of Taylor.

For example, the indictment alleges that on Sept. 8, 2012, after Taylor was searched at the border and his computer seized, Lustyik sent a text message to Thaler, stating: “You might have to save me and testify that only you r doing business.”  Nine days later, according to the indictment, Thaler told federal law enforcement agents – in a voluntary, recorded interview – that Lustyik was not involved in Taylor’s and Thaler’s business.

The pair also allegedly used an email “dead drop” to avoid leaving a record of their interactions and used the names of football teams and nicknames as part of their coded communications.

Taylor and Lustyik were both previously arrested on prior criminal complaints in this case.  Taylor has been detained pending trial and Lustyik received a $2 million bond.  Thaler is expected to surrender to authorities tomorrow.

If convicted, the defendants each face a maximum potential penalty of five years in prison on the conspiracy charge, 20 years in prison on each of the wire fraud charges, 10 years in prison on the obstruction of justice charge and five years in prison on the obstruction of an agency proceeding charge.  Each charge also carries a maximum $250,000 fine, or twice the gross gain or loss from the offense.  The indictment also seeks forfeiture of any proceeds traceable to the conspiracy, wire fraud and obstruction of justice offenses.

The case is being investigated by the Department of Justice Office of the Inspector General and prosecuted by Trial Attorneys Kevin Driscoll and Maria Lerner of the Criminal Division’s Public Integrity Section; Acting Deputy Chief Pamela Hicks, Acting Assistant Deputy Chief Jeannette Gunderson and Trial Attorney Ann Marie Blaylock of the Criminal Division’s Asset Forfeiture and Money Laundering Section; and Assistant U.S. Attorney Carlos Esqueda.

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