Tag Archives: bradford l. geyer

Philadelphia Money Launderer Pleads Guilty in Connection with Brooklyn Medicare Fraud Scheme

Posted on by
A Philadelphia resident pleaded guilty today for his role as a money launderer in a $13 million health care fraud scheme.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Loretta E. Lynch of the Eastern District of New York; George Venizelos, Assistant Director-in-Charge, 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.

Leonid Zalkind, 36, of Philadelphia, pleaded guilty to one count of conspiracy to commit money laundering before U.S. District Judge Nina Gershon of the Eastern District of New York.   At sentencing, scheduled for Dec. 2, 2013, Zalkind faces a maximum penalty of 20 years in prison and a $500,000 fine.

According to court documents, from 2010 to 2012, Zalkind operated numerous shell companies and bank accounts through which he laundered the proceeds of health care fraud from Brooklyn clinic Cropsey Medical Care PLLC.  Zalkind conspired with others to accept checks from Cropsey Medical, which were made payable to various shell companies Zalkind controlled.   These checks did not represent payment for any legitimate service at, or by, Cropsey Medical, but rather were written to launder Cropsey Medical’s fraudulently obtained health care proceeds.   Zalkind admitted at the plea proceeding that he deposited such checks into bank accounts he controlled, intending these transactions to hide and disguise the fact that these funds were proceeds of a crime.  He admitted that he knew these funds were proceeds of illegal activity.

The proceeds of checks Zalkind negotiated and cashed were given to the owners and operators of Cropsey Medical and were used to pay illegal cash kickbacks to Cropsey Medical’s purported patients.  According to court documents, from approximately November 2009 to October 2012, Cropsey Medical submitted more than $13 million in claims to Medicare and Medicaid, seeking reimbursement for a wide variety of fraudulent medical services and procedures, including physician office visits, physical therapy and diagnostic tests.

Eight individuals await trial, including a doctor, owners and employees of Cropsey Medical clinics and other individuals who paid and received kickbacks to induce the referral and transportation of patients to the clinic, as well as individuals who laundered funds for Cropsey Medical.  Trial has not yet been scheduled.

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

Michigan Physical Therapist Assistant/home Health Agency Owner Pleads Guilty for Role in Medicare Fraud Scheme

Posted on by
A greater Detroit-area physical therapist assistant – who was also an owner of a home health agency and a patient recruiter – pleaded guilty today for his role in a $22 million home health care fraud scheme.

Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan; Special Agent in Charge Robert D. Foley III of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the Chicago Regional Office of the U.S. Department of Health and Human Services’s Office of Inspector General (HHS-OIG) made the announcement.

Syed Shah, 51, of West Bloomfield, Mich., pleaded guilty before U.S. District Judge Bernard A. Friedman in the Eastern District of Michigan to one count of conspiracy to commit health care fraud.  At sentencing, scheduled for Nov. 19, 2013, Shah faces a maximum penalty of 10 years in prison.

According to information contained in plea documents, Shah, a licensed physical therapist assistant, admitted that beginning in or around October 2008 and continuing through approximately September 2012, he conspired with others to commit health care fraud by billing Medicare for home health care services that were not actually rendered and/or not medically necessary.  Shah admitted that he began working in approximately October 2008 for Prestige Home Health Services, Inc., a home health agency located in Troy, Mich., owned by alleged co-conspirators.  His co-conspirators at Prestige paid him kickbacks in exchange for his obtaining the information of Medicare beneficiaries, which the co-conspirators then used to bill Medicare for services that were not provided and/or were not medically necessary.  Shah and his co-conspirators then created fictitious therapy files appearing to document physical therapy services provided to Medicare beneficiaries, when in fact no such services had been provided and/or were not medically necessary. Shah admitted that his role in creating the fictitious therapy files was to sign documents and progress notes indicating he had provided physical therapy services to particular Medicare beneficiaries, when in fact he had not.  Shah admitted to knowing that the documents he falsified were used to support false claims billed to Medicare by his co-conspirators at Prestige.

In his plea, Shah also acknowledged that in approximately August 2009, he became an owner of Royal Home Health Care, Inc., a home health agency located in Troy, Mich., along with other co-conspirators.  He and his co-conspirators at Royal billed Medicare for home health visits that never occurred and were not medically necessary.  Shah and his co-conspirators paid kickbacks to Shah and other patient recruiters in exchange for Medicare beneficiary information, which was then used to bill Medicare for services that were not provided and/or were not medically necessary.  Shah admitted that he and his co-conspirators created fictitious therapy files, reflecting services that had not been provided and/or were not medically necessary.  He knew the documents he falsified would be used to support false claims by Royal to Medicare for home health services.

Shah submitted or caused the submission of claims to Medicare for services that were not medically necessary and/or not provided, which in turn caused Medicare to pay approximately $5,925,843. According to the indictment, two additional home health agencies were involved in the alleged conspiracy. In total, the four home health agencies at the center of the indictment received more than $22 million from the Medicare program.

This case was investigated by the FBI, HHS-OIG and IRS Criminal Investigation, brought as part of the Medicare Fraud Strike Force, and supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan. It is being prosecuted by Trial Attorney Niall M. O’Donnell of the Criminal Division’s Fraud Section.

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.

Three Former UBS Executives Sentenced to Serve Time in Prison for Frauds Involving Contracts Related to the Investment of Municipal Bond Proceeds

Posted on by
Three former financial services executives were sentenced today in U.S. District Court for the Southern District of New York for their participation in frauds related to bidding for contracts for the investment of municipal bond proceeds and other municipal finance contracts, the Department of Justice announced.

  Peter Ghavami, Gary Heinz and Michael Welty, all former UBS AG executives, were convicted on Aug. 31, 2012, after a five-week trial for their roles in the frauds.  They were sentenced today by U.S. District Court Judge Kimba Wood.  Ghavami was sentenced to serve 18 months in prison and to pay a $1 million criminal fine;  Heinz was sentenced to serve 27 months in prison and to pay a $400,000 criminal fine; and  Welty was sentenced to serve 16 months in prison and to pay a $300,000 criminal fine.

“For years, these executives corrupted the competitive bidding process and defrauded municipalities across the country for important public works projects,” said Scott D. Hammond, Deputy Assistant Attorney General of the Antitrust Division’s criminal enforcement program. “The division will continue to prosecute those who subvert and corrupt competitive markets for personal profit.”

According to evidence presented at trial, while employed at UBS, Ghavami, Heinz and Welty participated in multiple fraud conspiracies and schemes with various financial institutions and with a broker, at various time periods from as early as March 2001 until at least November 2006.  These financial institutions, or providers, offered a type of contract – known as an investment agreement – to state, county and local governments and agencies, and not-for-profit entities, throughout the United States. The public entities were seeking to invest money from a variety of sources, primarily the proceeds of municipal bonds that they had issued to raise money for, among other things, public projects. Public entities typically hire a broker to assist them in investing their money and to conduct a competitive bidding process to determine the winning provider.

At trial, the Department of Justice showed that while acting as providers, Ghavami, Heinz and Welty conspired with other providers and with a broker to corrupt the bidding process for more than a dozen investment agreements in order to increase the number and profitability of the agreements awarded to UBS.  At other times, while acting as brokers, Ghavami, Heinz, Welty and their co-conspirators arranged for UBS to receive kickbacks in exchange for manipulating the bidding process and steering investment agreements to certain providers. Ghavami, Heinz and Welty deprived the municipalities of competitive interest rates for the investment of tax-exempt bond proceeds that were to be used by municipalities to refinance outstanding debt and for various public works projects, such as for building or repairing schools, hospitals and roads. Evidence at trial established that they cost municipalities around the country and the U.S. Treasury millions of dollars.

During the trial, the government presented specific evidence relating to 26 corrupted bids, including 76 recorded conversations made by the co-conspirator financial institutions. Among the issuers and not-for-profit entities whose agreements or contracts were subject to the defendants’ schemes were the commonwealth of Massachusetts, the New Mexico Educational Assistance Foundation, the Tobacco Settlement Financing Corporation of Rhode Island, the Hospital Authority of Forsyth County, Ga., and the RWJ Health Care Corp. at Hamilton in New Jersey.

“The charges against these individuals outline a deceptive scheme to subvert competition in the marketplace. Those who engage in this type of criminal activity not only stand to defraud public entities, but erode the public’s trust in the competitive bidding process,” said George Venizelos, Acting Director in Charge of the FBI in New York.  “The sentences announced today remind the public that the FBI will continue to work with the Antitrust Division to ensure the integrity of competitive bidding in public finance.”

“Those who manipulate the competitive bidding system to benefit themselves will be held accountable for their criminal activity,” said Richard Weber, Chief, Internal Revenue Service – Criminal Investigation (IRS-CI). “The defendants conspired with others to corrupt the bidding process for more than a dozen investment agreements in order to increase the profitability of the agreements awarded to UBS. Quite simply, they enriched themselves at the expense of the towns and cities that needed the money for important public works projects such as building and repairing schools, hospitals and roads. IRS-CI is committed to using our financial expertise to uncover this kind of corruption.”

Ghavami was found guilty on two counts of conspiracy to commit wire fraud and one count of substantive wire fraud. Heinz was found guilty on three counts of conspiracy to commit wire fraud and two counts of substantive wire fraud. Welty was found guilty on three counts of conspiracy to commit wire fraud.

A total of 20 individuals have been charged as a result of the department’s ongoing municipal bonds investigation, and 19 have been convicted or pleaded guilty. Another individual awaits trial. Additionally, one company, Rubin/Chambers, Dunhill Insurance Services Inc. has pleaded guilty.

The sentences announced today resulted from an ongoing investigation conducted by the Antitrust Division’s New York and Chicago Offices, the FBI and the IRS-CI. The division is coordinating its investigation with the U.S. Securities and Exchange Commission, the Office of the Comptroller of the Currency and the Federal Reserve Bank of New York.

Today’s charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.

PANASONIC AND ITS SUBSIDIARY SANYO AGREE TO PLEAD GUILTY IN SEPARATE PRICE-FIXING CONSPIRACIES INVOLVING AUTOMOTIVE PARTS AND BATTERY CELLS

Posted on by

WASHINGTON — Panasonic Corp. and its subsidiary, SANYO Electric Co. Ltd.,  have agreed to plead guilty and to pay a total of $56.5 million in criminal  fines for their roles in separate price-fixing conspiracies involving automotive parts and battery cells, the Department of Justice announced  today.  LG Chem Ltd., a leading  manufacturer of secondary batteries, has agreed to plead guilty and to pay a  $1.056 million criminal fine for price fixing involving battery cells.

Osaka, Japan-based Panasonic agreed to pay a $45.8 million criminal  fine for its role in the automotive parts conspiracy. SANYO agreed to pay a  $10.731 million criminal fine for its role in the battery cells conspiracy.  The guilty pleas against SANYO and LG Chem  are the first in the department’s ongoing investigation into anticompetitive  conduct in the cylindrical lithium ion battery cell industry.

The three-count felony charge against Panasonic was filed in U.S.  District Court for the Eastern District of Michigan.  Separate one-count felony charges were filed  against SANYO and LG Chem in U.S. District Court for the Northern District of  California.  As part of the plea  agreements, which are subject to court approval, the charged companies have  agreed to cooperate in the department’s ongoing antitrust investigations.

Panasonic has agreed to plead  guilty for its role in a conspiracy to fix prices of switches, steering angle sensors and automotive high intensity discharge (HID) ballasts installed in  cars sold in the United States and elsewhere.   SANYO and LG Chem Ltd. have agreed to plead guilty for their roles in a  conspiracy to fix the prices of cylindrical lithium ion battery cells sold  worldwide for use in notebook computer battery packs.

“Panasonic is charged with participating in separate price-fixing  conspiracies affecting numerous parts used in cars made and sold in the United  States while its subsidiary was also fixing prices on battery cells used by  consumers of notebook computers,” said Scott D. Hammond, Deputy Assistant  Attorney General for the Antitrust Division’s criminal enforcement program.  “Pleading guilty and cooperating with the  division’s ongoing investigations is a necessary step in changing a corporate culture that turned customers into price-fixing victims.”

According  to the first count of a three-count felony charge filed today in U.S. District  Court for the Eastern District of Michigan in Detroit, Panasonic participated  in a conspiracy to rig bids for, and to fix, stabilize and maintain the prices  of steering wheel switches, turn switches, wiper switches, combination switches  and door courtesy switches sold to Toyota Motor Corp. and Toyota Motor  Engineering & Manufacturing North America Inc. in the United States and  elsewhere. According to the court document, Panasonic and its co-conspirators  carried out the conspiracy from at least as early as September 2003 until at  least February 2010.

The  second count charges that Panasonic, during this same time period, participated  in a conspiracy to rig bids for, and to fix, stabilize,  and maintain the prices of steering angle sensors sold to Toyota in the United  States and elsewhere. The department said that Panasonic and its  co-conspirators agreed, during meetings and conversations, to suppress and  eliminate competition in the automotive parts industry by agreeing to rig bids for, and to fix,  stabilize, and maintain the prices of steering angle sensors sold to Toyota  Motor Corp. and Toyota Motor Engineering & Manufacturing North America Inc.  in the United States and elsewhere.

According  to the third count of the charge, from at least as early as July 1998 and  continuing until at least February 2010, Panasonic and its co-conspirators  participated in a conspiracy to suppress and eliminate competition in the  automotive parts industry by agreeing, during meetings and conversations, to rig bids for, and to fix,  stabilize, and maintain the prices of automotive HID ballasts sold to Honda  Motor Co. Ltd. and American Honda Motor Co. Inc., Mazda Motor Corp. and Mazda  Motor of America Inc., and Nissan Motor Co. Ltd. and Nissan North America Inc.  in the United States and elsewhere.

Including Panasonic, 11 companies and 15 executives have pleaded  guilty or agreed to plead guilty and have agreed to pay a total of more than  $874 million in criminal fines as a result of the auto parts investigation. Additionally, 12 of the individuals have been sentenced to pay criminal fines and to serve jail sentences ranging from a year and a day to two years each. The three additional executives have agreed to serve time in prison and are currently awaiting sentencing.

“The FBI remains committed to protecting American consumers and  businesses from corporate corruption. The conduct of Panasonic, SANYO, and LG Chem  resulted in inflated production costs for notebook computers and cars purchased  by U.S. consumers,” said Joseph S. Campbell, FBI Criminal Investigative Division Deputy Assistant Director.  “These investigations illustrate our efforts to ensure market fairness for U.S. businesses by bringing corporations to justice when their commercial activity violates antitrust laws.”

According to the one-count felony charge  filed today in the U.S. District Court for the Northern District of California  in San Francisco, SANYO and LG Chem engaged in a conspiracy to fix the price of the cylindrical lithium ion battery cells used in notebook computer battery packs from about April 2007 until about September 2008. Cylindrical  lithium ion battery cells are rechargeable batteries that are often incorporated in groups into more powerful battery packs commonly used to power electronic devices.

According to the charges, SANYO, LG Chem and  their co-conspirators carried out the conspiracy by, among other things, agreeing during meetings and conversations to price cylindrical lithium ion  battery cells for use in notebook computer battery packs to customers at  predetermined levels and issuing price quotations to customers in accordance  with those agreements. The department also said that SANYO, LG Chem and their  co-conspirators collected and exchanged information for the purpose of  monitoring and enforcing adherence to the agreed-upon prices and took steps to  conceal the conspiracy.

Panasonic, SANYO and LG Chem are each charged with price fixing in  violation of the Sherman Act, which carries a maximum penalty of a $100 million criminal fine for corporations. The maximum fine for the company may be  increased to twice the gain derived from the crime or twice the loss suffered  by the victims, if either of those amounts is greater than the statutory  maximum fine.

Today’s charges arose from an ongoing  investigation in the cylindrical lithium ion battery cells industry being  conducted by the Antitrust Division’s San Francisco Office and the FBI in San  Francisco as well as 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 automotive parts charges  were brought by the Antitrust Division’s National Criminal Enforcement Section  and the FBI’s Detroit Field Office, with the assistance of the FBI  headquarters’ International Corruption Unit. Anyone with information on price  fixing, bid rigging and other anticompetitive conduct related to other products  in the automotive parts industry should contact the Antitrust Division’s  Citizen Complaint Center at 1-888-647-3258, visit www.justice.gov/atr/contact/newcase.html or call the FBI’s Detroit Field Office at 313-965-2323. Anyone  with information concerning illegal or anticompetitive conduct in the battery industry is urged to call the Antitrust Division’s San Francisco Office at  415-436-6660 or visit www.justice.gov/atr/contact/newcase.htm.

Diamond Electric Mfg. Co. Ltd. and an Autoliv Inc. Executive Agree to Plead Guilty to Price Fixing on Automobile Parts Installed in U.S. Cars;

Posted on by
Osaka, Japan-based Diamond Electric Mfg. Co. Ltd. has agreed to plead guilty and to pay a $19 million criminal fine for its role in a conspiracy to fix prices of ignition coils installed in cars sold in the United States and elsewhere, the Department of Justice announced today. This is the first case in the department’s antitrust investigation involving parts sold directly to an automobile company headquartered in the United States – Ford Motor Co. The department also announced that an Autoliv Inc. executive has agreed to plead guilty for his role in a conspiracy to fix the prices of certain seatbelts sold to Toyota Motor Corp. for installation in cars manufactured and sold in the United States and elsewhere.

Diamond Electric has agreed to cooperate with the department’s ongoing investigation. Takayoshi Matsunaga, a current employee of Autoliv and former vice president of the Toyota Global Business Unit at Autoliv Japan, agreed to serve one year and one day in a U.S. prison, to pay a $20,000 criminal fine and to cooperate with the department’s ongoing investigation. The plea agreements for both Diamond Electric and Matsunaga are subject to court approval.

According to a one-count felony charge filed today in U.S. District Court for the Eastern District of Michigan in Detroit, Diamond Electric engaged in a conspiracy, by agreeing during meetings and conversations, to rig bids for, and to fix, stabilize and maintain the prices of ignition coils it sold to Ford Motor Co., Toyota Motor Corp., Fuji Heavy Industries Ltd. and certain of their subsidiaries, in the United States and elsewhere, on a model-by-model basis. According to the charge, Diamond Electric and its co-conspirators carried out the conspiracy from at least as early as July 2003 until at least February 2010.

“Today’s prosecutions brings the total to 10 companies and 15 executives held accountable for fixing prices on parts used to manufacture cars in the United States,” said Scott D. Hammond, Deputy Assistant Attorney General of the Antitrust Division’s criminal enforcement program.  “The Antitrust Division and its law enforcement partners will protect American businesses and consumers from harmful price-fixing cartels and bring those responsible to justice.”

Diamond Electric manufactures and sells ignition coils.  Ignition coils are part of the fuel ignition system. They are responsible for quickly releasing electricity to the spark plugs for ignition.

According to a one-count felony charge filed today in the U.S. District Court for the Eastern District of Michigan in Detroit, Matsunaga, a Japanese national, engaged in a conspiracy to rig bids for, and to fix, stabilize and maintain the prices of certain seatbelts sold to Toyota in the United States and elsewhere. According to the charge, Matsunaga’s involvement in the conspiracy lasted from on or about May 2008 until at least February 2011.

“Those who engage in price fixing, bid rigging and other fraudulent schemes harm the automotive industry by driving up costs for vehicle makers and buyers,” said Robert D. Foley III, Special Agent in Charge, FBI Detroit Division.  “The FBI is committed to pursuing and prosecuting these individuals for their crimes.”

According to the charge, Matsunaga and his co-conspirators carried out the conspiracy by, among other things, agreeing during meetings and discussions to coordinate bids submitted to Toyota. Matsunaga is the 15th individual to agree to plead guilty in the department’s ongoing antitrust investigation into price fixing and bid rigging in the auto parts industry.

Stockholm-based Autoliv Inc. is a manufacturer of automotive occupant safety systems, including certain seatbelts.  In June 2012, Autoliv agreed to plead guilty and to pay a $14.5 million criminal fine for its role in a conspiracy to fix the prices of certain seatbelts, airbags and steering wheels installed in U.S. cars.

Including Diamond Electric and Matsunaga, 10 companies and 15 executives have pleaded guilty or agreed to plead guilty in the division’s ongoing investigation into price fixing and bid rigging in the auto parts industry and have agreed to pay a total of $828 million in criminal fines. DENSO, Nippon Seiki Ltd., Tokai Rika Co. Ltd., Furukawa Electric Co. Ltd, Yazaki Corp., G.S. Electech Inc., Fujikura Ltd., Autoliv Inc. and TRW Deutschland Holding GmbH have already pleaded guilty.  Additionally, 12 individuals have been sentenced to pay criminal fines and to serve jail sentences ranging from a year and a day to two years each. Two additional executives have agreed to serve time in prison and are currently awaiting sentencing.

Diamond Electric and Matsunaga are charged with price fixing in violation of the Sherman Act, which carries maximum penalties of a $100 million criminal fine for corporations and 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.

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 National Criminal Enforcement Section and the FBI’s Detroit Field Office, with the assistance of the FBI headquarters’ International Corruption Unit.

GeyerGorey LLP Establishes 24/7 Client Emergency Hotline

Posted on by

GeyerGorey LLP announced today that it had established a 24/7 Client Emergency Hotline that will always be answered “live” by a GeyerGorey attorney.  Current clients should expect to be provided with this telephone number in a separate, confidential communication.

Press Release