Tag Archives: Daniel G. Bogden

Department of Defense Employee Pleads Guilty to Submitting False Claim for Housing Allowance

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A Department of Defense (DOD) employee has pleaded guilty to filing a false claim with the DOD while stationed in the Republic of Korea (ROK) to fraudulently obtain $64,000 in housing allowance, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Daniel G. Bogden of the District of Nevada.

Patrick Y. Kim, 56, of Reno, Nev., pleaded guilty today before U.S. District Judge Howard D. McKibben in the District of Nevada in Reno to one count of making a false claim.  Kim faces a maximum penalty of five years in prison when he is sentenced on Feb. 12, 2014.  As part of his plea agreement, Kim has agreed to pay full restitution to the DOD in the amount of $64,000.

The former chief of the Furniture Branch at the United States Army Garrison in Daegu, ROK, Kim admitted that he submitted a fraudulent lease to the housing office to obtain a living quarters allowance (LQA) that he was not entitled to receive.  Kim began working at Daegu Garrison in or about October 2002, and, as a DOD civilian employee working in the ROK, he was entitled to receive certain housing allowances, including LQA under certain circumstances.  To receive LQA, Kim was required to submit a copy of a housing lease in support of his application and acknowledge that the LQA payments were exclusively for the payment of rent and not for the payment of refundable security deposits or “key money” leases.  Key money leases – sums of money paid to a lessor in lieu of rent, which are returned to the lessee at the end of the lease – are common in the ROK; however, they are prohibited by State Department regulations.

Kim admitted that in September 2008, he was looking for a new apartment as the lease for his current apartment was about to expire.  He and his wife located a residence at an apartment complex; however, the owners of the apartments did not offer traditional rental leases – only key money leases and purchases.  On or about Sept. 8, 2008, Kim’s wife entered into a key money lease for one of the apartments.  Kim admitted that he knew that State Department regulations prohibited him from receiving LQA to pay for the key money lease signed by his wife.  On or about Sept. 9, 2008, Kim created a fake rental lease for the subject property and submitted it to the housing office at Daegu Garrison in support of his request for LQA.  The fake lease for the apartment purported to be a two-year lease with a total cost of $64,000.  Kim admitted receiving $64,000 in LQA, which is non-taxable, and also admitted that he used the money to pay for a portion of the key money lease entered into by his wife.

Kim also admitted that he created a fake receipt for the purported $64,000 rental payment and submitted it to the housing office at Daegu Garrison to justify his receipt of the LQA.  He received the $64,000 back at the end of the key money lease in 2010, and he used it for the purchase of a new residence in the ROK.

The case is being investigated by the U.S. Army Criminal Investigation Division and the FBI.  The case is being prosecuted by Trial Attorney Richard B. Evans of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Sue P. Fahami of the District of Nevada.

Las Vegas Agent Convicted in Mortgage Fraud Scheme

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A Las Vegas mortgage agent has been convicted for his role in a “cash back at closing” mortgage fraud scheme that netted $1.43 million in fraudulent mortgage loans, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Daniel G. Bogden of the District of Nevada, and Acting Special Agent in Charge William C. Woerner of the FBI’s Las Vegas Field Office.
After a three-day trial before U.S. District Judge Larry Hicks in the District of Nevada, a federal jury convicted Jawad “Joe” Quassani, 42, on July 10, 2013, of one count of conspiracy to commit wire fraud and mail fraud, two counts of wire fraud, and two counts of mail fraud.
According to court documents and evidence presented at trial, Quassani participated in a scheme in which the prices of two homes were falsely inflated, mortgage loans were obtained through the submission of loan applications containing false and fraudulent information about the buyer’s income and intent to occupy the homes as primary residences, a portion of the loan proceeds was diverted at the close of escrow to the defendant’s co-conspirators, and commissions on the fraudulent loans were paid to Quassani and his co-conspirator.  Evidence at trial established that Quassani, a licensed mortgage agent at Rapid Funding Group, conceived the scheme together with two of his co-conspirators, prepared one of the loan applications and arranged for the preparation of the other, and shared in the commissions generated by transactions that had no purpose other than to generate profits for the co-conspirators.
Co-conspirators Anita Mathur and Shirjil “Sean” Qureshi previously pleaded guilty in related cases in Las Vegas to one count of conspiracy to commit bank fraud, wire fraud and mail fraud.  Both are awaiting sentencing.
This case was investigated by the FBI.  Trial Attorneys Stephen J. Spiegelhalter and Gary A. Winters of the Criminal Division’s Fraud Section are prosecuting the case.
Today’s conviction is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 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 more than 10,000 financial fraud cases against nearly 15,000 defendants, including more than 2,700 mortgage fraud defendants.

Former U.S. Army Reserve Captain Pleads Guilty in Nevada to Bribery Scheme

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A former U.S. Army Reserve captain pleaded guilty today to accepting more than $90,000 in bribes from contractors while he was deployed to Iraq, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division and U.S. Attorney Daniel G. Bogden of the District of Nevada.

Edward William Knotts III, 51, of Gibbon, Neb., pleaded guilty before U.S. District Judge James Mahan in the District of Nevada to a criminal information charging him with one count of bribery. He faces a maximum penalty of 15 years in prison when he is sentenced on Oct. 8, 2013.

According to court documents, from December 2005 until December 2007, Knotts was stationed at Camp Buehring, Kuwait, as a contracting officer’s representative for contracts between the U.S. Army and local contractors to provide services to support the operations at Camp Buehring and another U.S. camp in Kuwait.

In November 2006, Knotts entered into an agreement with a Kuwait-based corporation to receive a monthly fee from the corporation in return for providing confidential bidding information about U.S. Army contracts.  Between November 2006 and November 2007, the corporation paid him approximately $31,500 in cash.  In June 2007, a representative of the corporation paid Knotts $40,000 at a hotel room in Las Vegas in return for his promise to provide confidential bid information and in anticipation of the corporation hiring him.  Knotts received another similar cash payment of $20,000 in August 2008 in a different Las Vegas hotel.

This case was investigated by the Special Inspector General for Iraq Reconstruction, Defense Criminal Investigative Service and U.S. Army Criminal Investigation Command. The case is being prosecuted by Director of Procurement Fraud Litigation Catherine Votaw and Trial Attorney Brian Young of the Criminal Division’s Fraud Section.

Las Vegas Mortgage Agent Sentenced to 15 Months in Prison for Role in Mortgage Fraud Scheme

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A Las Vegas mortgage agent was sentenced late yesterday to serve 15 months in prison for her participation in a mortgage fraud scheme that netted more than $1.2 million in fraudulent mortgage loans, Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney Daniel G. Bogden of the District of Nevada and Acting Special Agent in Charge William C. Woerner of the FBI’s Las Vegas Field Office announced today.

Heidi Haischer, 44, was sentenced by U.S. District Judge Miranda M. Du in the District of Nevada.  In addition to her prison term, Haischer was sentenced to serve three years of supervised release.

In November 2012, after a four-day trial, a federal jury in Las Vegas found Haischer guilty of one count of wire fraud and one count of conspiracy to commit wire fraud for submitting fraudulent loan documents to purchase two homes.

According to court documents and evidence presented at trial, Haischer participated in a mortgage fraud scheme while employed as a mortgage broker in Nevada.  From December 2006 to January 2007, Haischer and her co-conspirators fraudulently secured loans totaling over $1 million to obtain properties with the intent to flip and sell them for profit.  Evidence at trial showed that Haischer and her co-conspirators subsequently enriched themselves by collecting brokerage commissions generated by the sales of the properties.

The court documents and trial evidence demonstrated that Haischer submitted multiple loan applications in which she overstated her income, submitted false verification of employment and misrepresented her intent to reside in one of the properties as her primary residence.  Additionally, Haischer presented inflated bank account balances supported by forged bank statements to make it appear that she had assets she did not have, in order to help qualify for mortgage loans for which she otherwise would not have been eligible.

Co-conspirator Kelly Nunes was convicted in a related case in Las Vegas on Feb. 2, 2012, of one count of bank fraud and one count of conspiracy to commit wire and bank fraud.  On July 11, 2012, Nunes was sentenced to 51 months in prison.

This case was investigated by the FBI.  Trial Attorneys Thomas B.W. Hall and Brian R. Young of the Criminal Division’s Fraud Section prosecuted the case, with assistance from the U.S. Attorney’s Office for the District of Nevada.

This case was a result of efforts by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 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 more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.StopFraud.gov.