Tag Archives: Leslie R. Caldwell

Co-Founder of Government Contracting Company Pleads Guilty to Bribery

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Timothy S. Miller, 58, a co-founder of a Chesapeake, Virginia, government contracting company, pleaded guilty today to bribing two public officials working for the United States Navy Military Sealift Command.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, United States Attorney Dana J. Boente of the Eastern District of Virginia, Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office, Special Agent in Charge Susan Triesch of the Naval Criminal Investigative Service (NCIS) Norfolk Field Office, and Special Agent in Charge Royce E. Curtin of the FBI Norfolk Field Office made the announcement today after Miller’s guilty plea was accepted by United States Magistrate Judge Lawrence R. Leonard of the Eastern District of Virginia.

According to a statement of facts filed with the plea agreement, in February 2009, Miller, along with his business partner, Dwayne A. Hardman, co-founded a government contracting company that provided telecommunications support to the Military Sealift Command, which is the leading provider of transportation for the U.S. Navy.

At the plea hearing, Miller admitted that he bribed two officials at the Military Sealift Command for favorable official acts.    In particular, he admitted that on May 12, 2009, he gave $30,000 in cash to Kenny E. Toy, the former Afloat Programs Manager for the Military Sealift Command’s N6 Command, Control, Communication, and Computer Systems Directorate, and Scott B. Miserendino Sr., a government contractor who worked with Toy at the Military Sealift Command Headquarters.    He also admitted that just two days after giving Toy and Miserendino the $30,000, he agreed that Hardman should give Toy and Miserendino an additional $20,000.

According to Miller’s statement of facts, Toy exercised substantial influence over the Military Sealift Command contracting process by creating and executing multi-million dollar budgets, obtaining funding for projects, developing and having access to sensitive information, and requesting that subcontract work be awarded to particular companies.   As a result of the $50,000 payment, Miserendino and Toy performed various official acts to assist Miller’s company.    Indeed, in 2009, Miller’s company received approximately $2.5 million in business from the Military Sealift Command.

As a condition of his plea agreement, Miller has agreed to forfeit $167,000.    Miller is scheduled to be sentenced on November 7, 2014.

Earlier this year, five other individuals pleaded guilty in connection with the bribery scheme.    On February 12, 2014, Toy pleaded guilty to bribery, and he was sentenced on July 29, 2014, to serve 96 months in prison and ordered to forfeit $100,000.    On February 18, 2014, Hardman pleaded guilty to bribery, and he was sentenced on July 9, 2014, to serve 96 months in prison and ordered to forfeit $144,000.    On February 19, 2014, Michael P. McPhail pleaded guilty to conspiracy to commit bribery, and he was sentenced on August 5, 2014, to serve 36 months in prison and ordered to forfeit $57,000.    On March 5, 2014, Roderic J. Smith pleaded guilty to conspiracy to commit bribery, and he was sentenced on June 23, 2014, to serve 48 months in prison and ordered to forfeit $175,000.    On April 4, 2014, Adam C. White pleaded guilty to conspiracy to commit bribery, and he was sentenced on July 11, 2014, to serve 24 months in prison and ordered to forfeit $57,000.

The case was investigated by the FBI, NCIS and DCIS.    The case was prosecuted by Trial Attorney Emily Rae Woods of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Stephen W. Haynie of the Eastern District of Virginia.

Director of Nursing Pleads Guilty in Miami for Role in $7 Million Health Care Fraud Scheme

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A former director of nursing pleaded guilty today in connection with a health care fraud scheme involving Anna Nursing Services Corp. (Anna Nursing), a defunct home health care company in Miami.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, and Acting Special Agent in Charge Ryan Lynch of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office made the announcement.
Armando Buchillon, 42, of Hialeah, Florida, pleaded guilty before U.S. District Judge Joan A. Lenard in the Southern District of Florida to one count of conspiracy to commit health care fraud.    Sentencing is scheduled for Oct. 6, 2014, before Judge Lenard.
According to court documents, Buchillon was a director of nursing at Anna Nursing, a Miami home health care agency that purported to provide home health and therapy services to Medicare beneficiaries.    The owners and operators of Anna Nursing agreed to and actually did operate Anna Nursing for the purpose of billing the Medicare Program for, among other things, expensive physical therapy and home health care services that were not medically necessary and/or were not provided.
As part of the fraudulent scheme, Buchillon and his co-conspirators regularly falsified patient documentation in order to make it appear that beneficiaries qualified for and received home health care services, when, in fact, many of the beneficiaries did not actually qualify for or receive such services.    In addition, Buchillon paid kickbacks and bribes to patient recruiters, in return for the recruiters providing patients to Anna Nursing for home health care and therapy services that were medically unnecessary and/or were not provided.    Buchillon also worked as a patient recruiter for Anna Nursing and was paid kickbacks and bribes by the owner of Anna Nursing.    Buchillon and his co-conspirators caused the submission of false and fraudulent claims to Medicare on behalf of these beneficiaries.
From approximately October 2010 through approximately April 2013, Anna Nursing was paid by Medicare approximately $7 million for fraudulent claims for home health care services that were medically unnecessary and/or were not provided.
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 Southern District of Florida.    This case is being prosecuted by Trial Attorneys A. Brendan Stewart and Anne P. McNamara 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 nearly 1,900 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .

 

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Former U.S. Navy Military Sealift Command Manager Sentenced for Receiving Bribes

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Kenny E. Toy, 54, the former Afloat Programs Manager at the United States Navy Military Sealift Command, was sentenced today to serve 96 months in prison for receiving bribes.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, United States Attorney Dana J. Boente of the Eastern District of Virginia, Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office, Acting Executive Assistant Director Charles T. May Jr. of the Naval Criminal Investigative Service (NCIS) Atlantic Operations and Special Agent in Charge Royce E. Curtin of the FBI’s Norfolk Field Office made the announcement today after sentencing by United States Chief Judge Rebecca Beach Smith of the Eastern District of Virginia.

On Feb. 12, 2014, Toy pleaded guilty to a criminal information charging him with one count of bribery.   According to the statement of facts filed with Toy’s plea agreement, Toy was employed as the Afloat Programs Manager in the N6 Command, Control, Communication, and Computer Systems Directorate at the Military Sealift Command, which is the leading provider of transportation for the United States Navy.  In approximately November 2004, Toy joined an extensive bribery conspiracy that spanned five years, involved multiple co-conspirators, including two different companies, and resulted in the payment of more than $265,000 in cash bribes, among other things of value, to Toy and to Scott B. Miserendino Sr., a former government contractor who performed work for the Military Sealift Command.

At his plea hearing, Toy admitted that he accepted monthly cash bribes of approximately $3,000, as well as a flat screen television and a paid vacation to the Outer Banks in North Carolina, from co-conspirators Dwayne A. Hardman, Roderic J. Smith, Michael P. McPhail and Adam C. White, all of whom were employed at a government contracting company referred to as Company A in court documents.  Toy also admitted that he accepted a $50,000 cash bribe in May 2009 from Hardman and another co-conspirator, Timothy S. Miller, both of whom were employed at a government contracting company referred to as Company B in court documents.  In exchange for the bribes, Toy provided favorable treatment to Company A and Company B in connection with Military Sealift Command related business.

As part of his guilty plea, Toy also admitted to engaging in a scheme to conceal his criminal activity.  Toy admitted to causing more than $88,000 to be paid to Hardman in an attempt to prevent Hardman from reporting the bribery scheme to law enforcement authorities.

Toy was also ordered to serve a supervised release term of three years following his prison sentence, and ordered to forfeit $100,000.

Earlier this year, four other individuals pleaded guilty in connection with the bribery scheme.  On Feb. 18, 2014, Hardman, the co-founder of Company A and Company B, pleaded guilty to providing bribes to Toy and Miserendino.   On Feb. 19, 2014, McPhail, a former employee at Company A, pleaded guilty to conspiracy to commit bribery.   On April 4, 2014, White, a former vice president at Company A, pleaded guilty to conspiracy to commit bribery.   On March 5, 2014, Smith, the former president of Company A, pleaded guilty to conspiracy to bribe public officials.   On June 23, 2014, United States District Judge Henry Coke Morgan sentenced Smith to serve 48 months in prison followed by one year of supervised release and ordered him to forfeit $175,000.

On May 23, 2014, a grand jury in the Eastern District of Virginia indicted Miserendino and Timothy S. Miller, a businessman whose company sought contracting business from the Military Sealift Command.   The indictment charges Miserendino with one count of conspiracy to commit bribery, one count of bribery, one count of conspiracy to commit obstruction of criminal investigations and to commit tampering with a witness, and one count of obstruction of criminal investigations.   The indictment charges Miller with one count of conspiracy to commit bribery and two counts of bribery.   Trial is set for Sept. 30, 2014, before Chief Judge Rebecca Beach Smith.

Charges contained in an indictment are merely allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

The case was investigated by the FBI, NCIS and DCIS.   The case was prosecuted by Trial Attorney Emily Rae Woods of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Stephen W. Haynie of the Eastern District of Virginia.

Iraq Extradites Fugitive Defense Contractor to U.S. to Face Fraud Charges

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A Las Vegas-based former Department of Defense contractor has been extradited from Iraq to the United States to face fraud and conspiracy charges for attempting to bribe U.S. officials in order to secure government contracts for his companies.   Metin Atilan, 54, is the first person extradited from Iraq to the United States pursuant to the U.S.-Iraq extradition treaty signed on June 7, 1934 and entered into force in 1936.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Carter M. Stewart of the Southern District of Ohio, Special Agent in Charge Kevin Cornelius of the FBI’s Cincinnati Office and Resident Agent in Charge Bret Flinn of the Defense Criminal Investigation Service (DCIS) made the announcement.
“This historic extradition from Iraq to the United States is an example of our cooperation with law enforcement worldwide to bring fugitives to justice,” said Assistant Attorney General Caldwell.  “Atilan’s return to the United States, after more than six years on the run, sends a clear message to fugitives: no matter where in the world you try to hide, we will find you, and we will prosecute you.”
“ This case is a tremendous example of a successfully organized and cooperative law enforcement effort put forth by the FBI, DCIS, Interpol and the Iraqi government,” said Special Agent in Charge Cornelius.  “I commend the work of the FBI’s Legal Attaché  Office and the U.S. Embassy Country Team in Iraq. They have garnered a superior level of law enforcement cooperation between the FBI and Iraqi officials. Without their support, this extradition would not have been possible.”
Atilan, a dual U.S. and Turkish citizen, is scheduled to appear today before U.S. Magistrate Judge Michael R. Merz of the Southern District of Ohio.
Atilan was charged by indictment on June 10, 2008, with conspiracy to engage in contract fraud, conspiracy to engage in wire fraud, and wire fraud.    According to court documents, Atilan is p resident and chief executive officer of PMA Services Ltd. of Las Vegas and Kayteks Ltd. of Adna, Turkey.    In 2006 through 2008, Atilan offered bribes and kickbacks in order to secure contracts for businesses he owned in connection with services and construction associated with U.S. military operations in Iraq.    Some of the Defense Department contracting officials who Atilan is accused of trying to bribe were stationed in Dayton at the time.
Atilan was first arrested in Las Vegas on May 23, 2008.  Atilan was placed on electronic monitoring pending his formal hearing before a federal judge in Dayton, Ohio.    On June 15, 2008, Atilan allegedly violated the terms of his pretrial release by cutting off his electronic bracelet and fleeing the country.    The government sought his extradition, and Atilan arrived in Dayton, Ohio on July 27, 2014.
An indictment is merely an accusation, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case was investigated by the FBI and DCIS.    The case is being prosecuted by Assistant U.S. Attorney Dwight Keller of the Southern District of Ohio with assistance from Trial Attorney Dan E. Stigall of the Criminal Division’s Office of International Affairs and Department of Justice Attaché Ellen Endrizzi.    The Criminal Division’s Office of International Affairs also provided assistance.

 

French Citizen Sentenced for Obstructing a Criminal Investigation into Alleged Bribes Paid to Win Mining Rights in Guinea

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Frederic Cilins, a 51-year old French citizen, was sentenced today in the Southern District of New York to 24 months in prison for obstructing a federal criminal investigation into alleged bribes to obtain mining concessions in the Republic of Guinea.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Preet Bharara of the Southern District of New York and Assistant Director in Charge George Venizelos of the FBI’s New York Field Office made the announcement.    The sentence was imposed by U.S. District Court Judge William H. Pauley III.
“Cilins offered to bribe a witness in an FCPA investigation to stop the witness from talking to the FBI,” said Assistant Attorney General Caldwell.  “Today’s sentence holds Cilins accountable for his effort to undermine the integrity of our justice system, and sends a message that those who interfere with federal investigations will be prosecuted and sent to prison.”
“Frederic Cilins went to great lengths to thwart a Manhattan federal grand jury’s investigation into an alleged bribery scheme in the Republic of Guinea,” said U.S. Attorney Bharara.  “In an effort to prevent the federal authorities from learning the truth, Cilins paid a witness for her silence and to destroy key documents.  Today, Cilins learned that no one can manipulate justice.”
“Cilins obstructed the efforts of the FBI during the course of this investigation,” said Director in Charge Venizelos.  “His guilty plea and sentence demonstrate our shared commitment with the department’s Criminal Division and U.S. Attorney’s Office to hold accountable those who seek to interfere with the administration of justice. This case should be a reminder to all those who try to circumvent the efforts of a law enforcement investigation: the original crime and the cover-up both lend themselves to prosecution.”
According to court documents, Cilins obstructed an ongoing federal investigation concerning potential violations of the Foreign Corrupt Practices Act (FCPA) and other crimes.    Federal law enforcement was investigating whether a particular mining company with which Cilins was affiliated paid bribes to officials of a former governmental regime in the Republic of Guinea to obtain and retain valuable mining concessions in the Republic of Guinea’s Simandou region.    During monitored and recorded phone calls and face-to-face meetings, Cilins agreed to pay substantial sums of money to induce a witness to the alleged bribery scheme to leave the United States to avoid questioning by the FBI, as well as to give documents to Cilins for destruction that had been requested by the FBI as part of the investigation.    Cilins also sought to induce the witness to sign an affidavit containing false statements regarding matters under investigation by the grand jury.    That witness was the former wife of a now-deceased Guinean government official who held an office in Guinea that allowed him to influence the award of mining concessions.
Cilins pleaded guilty on March 10, 2014 to a one-count superseding information charging him with obstruction of a federal investigation.    In addition to his sentence, he was ordered to pay a fine of $75,000 and forfeit $20,000.
The case was investigated by the FBI.    The case is being prosecuted by Trial Attorney Tarek Helou of the Criminal Division’s Fraud Section and Assistant United States Attorney Elisha J. Kobre of the Southern District of New York.    The Criminal Division’s Office of International Affairs and Office of Enforcement Operations provided valuable assistance in the investigation.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa .

 

Former Chief Executive Officer of Lufthansa Subsidiary BizJet Pleads Guilty to Foreign Bribery Charges

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The former president and chief executive officer of BizJet International Sales and Support Inc., a U.S.-based subsidiary of Lufthansa Technik AG with headquarters in Tulsa, Oklahoma, that provides aircraft maintenance, repair and overhaul services, pleaded guilty today for his participation in a scheme to pay bribes to foreign government officials.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Danny C. Williams Sr., of the Northern District of Oklahoma and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.
“The former CEO of BizJet, Bernd Kowalewski, has become the third and most senior Bizjet executive to plead guilty to bribing officials in Mexico and Panama to get contracts for aircraft services,” said Assistant Attorney General Caldwell.  “While Kowalewski and his fellow executives referred to the corrupt payments as ‘commissions’ and ‘incentives,’ they were bribes, plain and simple.  Though he was living abroad when the charges were unsealed, the reach of the law extends beyond U.S. borders, resulting in Kowalewski’s arrest in Amsterdam and his appearance in court today in the United States.  Today’s guilty plea is an example of our continued determination to hold corporate executives responsible for criminal wrongdoing whenever the evidence allows.”
“I commend the investigators and prosecutors who worked together across borders and jurisdictions to vigorously enforce the Foreign Corrupt Practices Act,” said U.S. Attorney Williams.  “Partnership is a necessity in all investigations. By forging and strengthening international partnerships to combat bribery, the Department of Justice is advancing its efforts to prevent crime and to protect citizens.”
Bernd Kowalewski, 57, the former President and CEO of BizJet, pleaded guilty today in federal court in Tulsa, Oklahoma, to conspiracy to violate the Foreign Corrupt Practices Act (FCPA) and a substantive violation of the FCPA in connection with a scheme to pay bribes to officials in Mexico and Panama in exchange for those officials’ assistance in securing contracts for BizJet to perform aircraft maintenance, repair and overhaul services.
Kowalewski was arrested on a provisional arrest warrant by authorities in Amsterdam on March 13, 2014, and waived extradition on June 20, 2014.    Kowalewski is the third BizJet executive to plead guilty in this case.    Peter DuBois, the former Vice President of Sales and Marketing, pleaded guilty on Jan. 5, 2012, to conspiracy to violate the FCPA and a substantive violation of the FCPA and Neal Uhl, the former Vice President of Finance, pleaded guilty on Jan. 5, 2012, to conspiracy to violate the FCPA.    Jald Jensen, the former sales manager at BizJet, has been indicted for conspiracy as well as substantive FCPA violations and money laundering and is believed to be living abroad.

Charges were unsealed against the four defendants on April 5, 2013.
According to court filings, Kowalewski and his co-conspirators paid bribes directly to foreign officials to secure aircraft maintenance repair and overhaul contracts, and in some instances, the defendants funneled bribes to foreign officials through a shell company owned and operated by Jensen.    The shell company, Avionica International & Associates Inc., operated under the pretense of providing aircraft maintenance brokerage services but in reality laundered money related to BizJet’s bribery scheme.    Bribes were paid to officials employed by the Mexican Policia Federal Preventiva, the Mexican Coordinacion General de Transportes Aereos Presidenciales, the air fleet for the Gobierno del Estado de Sinaloa, the air fleet for the Gobierno del Estado de Sonora and the Republica de Panama Autoridad Aeronautica Civil.
Further according to court filings, the co-conspirators discussed in e-mail correspondence and at corporate meetings the need to pay bribes, which they referred to internally as “commissions” or “incentives,” to officials employed by the foreign government agencies in order to secure the contracts.    At one meeting, for example, in response to a question about who the decision-maker was at a particular customer organization, DuBois stated that a director of maintenance or chief pilot was normally responsible for decisions on where an aircraft went for maintenance work.    Kowalewski then responded by explaining that the directors of maintenance and chief pilots in the past received “commissions” of $3,000 to $5,000 but were now demanding $30,000 to $40,000 in “commissions.” Similarly, in e-mail correspondence between Uhl, DuBois, Kowalewski, and several others, Uhl responded to a question about BizJet’s financial outlook if “incentives” paid to brokers, directors of maintenance, or chief pilots continued to increase industry wide, stating that they would “work to build these fees into the revenue as much as possible.    We must remain competitive in this respect to maintain and gain market share.”
On March 14, 2012, the department announced that it had entered into a deferred prosecution agreement with BizJet, requiring that BizJet pay an $11.8 million monetary penalty to resolve charges related to the corrupt conduct.    That agreement acknowledged BizJet’s voluntary disclosure, extraordinary cooperation, and extensive remediation in this case.    In addition, the department announced on March 14, 2012, that BizJet’s indirect parent company, Lufthansa Technik AG, entered into an agreement with the department in which the department agreed not to prosecute Lufthansa Technik provided that Lufthansa Technik satisfies its obligations under the agreement for a period of three years.
This case is being investigated by the FBI’s Washington Field Office with substantial assistance form the Oklahoma Field Office.    The department has worked closely with its law enforcement counterparts in Amsterdam, Mexico and Panama, and has received significant assistance from Germany and Uruguay.    The Criminal Division’s Office of International Affairs has also provided assistance.    This case is being prosecuted by Assistant Chief Daniel S. Kahn and Trial Attorney David Fuhr of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Kevin Leitch of the Northern District of Oklahoma.

Former Executive of French Power Company Subsidiary Pleads Guilty in Connection with Foreign Bribery Scheme

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A former senior executive of a subsidiary of Alstom SA, the French power and transportation company, pleaded guilty today for his participation in a scheme to pay bribes to foreign government officials.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney Michael J. Gustafson of the District of Connecticut and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.
William Pomponi, a former vice president of regional sales at Alstom Power Inc., the Connecticut-based power subsidiary of Alstom, pleaded guilty today in federal court in New Haven, Connecticut, to a criminal information charging him with conspiracy to violate the Foreign Corrupt Practices Act (FCPA) in connection with the awarding of the Tarahan power project in Indonesia.    Pomponi was charged in a second superseding indictment on July 30, 2013.    Pomponi is the fourth defendant to plead guilty to charges stemming from this investigation.    Frederic Pierucci, the vice president of global boiler sales at Alstom, pleaded guilty on July 29, 2013, to one count of conspiracy to violate the FCPA and one count of violating the FCPA; and, David Rothschild, a former vice president of regional sales at Alstom Power Inc., pleaded guilty to conspiring to violate the FCPA on Nov. 2, 2012.  Marubeni Corporation, Alstom’s consortium partner on the Tarahan project, pleaded guilty on March 19, 2014, to one count of conspiracy to violate the FCPA and seven counts of violating the FCPA, and was sentenced to pay a criminal fine of $88 million.    FCPA and money laundering charges remain pending against Lawrence Hoskins, the former senior vice president for the Asia region for Alstom, and trial is scheduled for June 2, 2015.
“Three Alstom corporate executives and Marubeni, a major Japanese corporation, have now pleaded guilty to a seven-year scheme to pay bribes to Indonesian officials to secure a $118 million power contract,” said Assistant Attorney General Caldwell.  “The Criminal Division of the Department of Justice will follow evidence of corruption wherever it leads, including into corporate boardrooms and corner offices.  As this case demonstrates, we will hold both companies and their executives responsible for criminal conduct.”
According to the court filings, the defendants, together with others, paid bribes to officials in Indonesia, including a member of the Indonesian Parliament and high-ranking members of Perusahaan Listrik Negara (PLN), the state-owned and state-controlled electricity company in Indonesia, in exchange for assistance in securing a $118 million contract, known as the Tarahan project, to provide power-related services for the citizens of Indonesia from facilities in Tarahan.    To conceal the bribes, the defendants retained two consultants purportedly to provide legitimate consulting services on behalf of Alstom and Marubeni in connection with the Tarahan project.    In reality, the primary purpose for hiring the consultants was to use the consultants to pay bribes to Indonesian officials.
The first consultant retained by the defendants allegedly received hundreds of thousands of dollars in his Maryland bank account to be used to bribe the member of Parliament.    The consultant then allegedly transferred the bribe money to a bank account in Indonesia for the benefit of the official.    According to court documents, emails between Hoskins, Pomponi, Pierucci, Rothschild, and their co-conspirators discuss in detail the use of the first consultant to funnel bribes to the member of Parliament and the influence that the member of Parliament could exert over the Tarahan project.
However, in the fall of 2003, Hoskins, Pomponi, Pierucci and others determined that the first consultant was not effectively bribing key officials at PLN.    One email between Alstom employees described PLN officials’ “concern that if we have won the job, whether their rewards will still be satisfactory or this agent only give them pocket money and disappear.” In another email, an employee at Alstom’s subsidiary in Indonesia sent an email to Hoskins asserting that the first consultant “has no grip on the PLN Tender team at all” and “is more or less similar to [a] cashier which I feel we pay too much.”
As a result, the co-conspirators retained a second consultant to bribe PLN officials, according to the court documents.    The co-conspirators deviated from Alstom’s usual practice of paying consultants on a pro-rata basis in order to make a much larger up-front payment to the second consultant so that the consultant could “get the right influence.” An employee at Alstom’s subsidiary in Indonesia sent an email to Hoskins, Pomponi, Pierucci and others asking them to finalize the consultancy agreement with the front-loaded payments but stated that in the meantime the employee would give his word to a high-level official at PLN, according to the charges.    The defendants and their co-conspirators were successful in securing the Tarahan project and subsequently made payments to the consultants for the purpose of bribing the Indonesian officials.
An indictment is merely an accusation, and defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
The case is being investigated by FBI agents who are part of the Washington Field Office’s dedicated FCPA squad, with assistance from the Meriden, Connecticut, Resident Agency of the FBI.    Significant assistance was provided by the Criminal Division’s Office of International Affairs, and the department has also received substantial assistance from its law enforcement counterparts in Indonesia, Switzerland and Singapore and greatly appreciates their cooperation.    The case is being prosecuted by Assistant Chief Daniel S. Kahn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney David E. Novick of the District of Connecticut.

South Florida Man Sentenced to Prison for $10.5 Million Medicare Fraud Scheme

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A south Florida man was sentenced today in federal court in Tampa, Florida, to serve 48 months in prison in connection with a $10.5 million Medicare fraud scheme involving physical and occupational therapy services.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney A. Lee Bentley III for the Middle District of Florida, Acting Special Agent in Charge Ryan Lynch of the U.S. Health and Human Services Office of Inspector General (HHS-OIG) region including all of Florida, and Special Agent in Charge Paul Wysopal of the FBI’s Tampa Field Office made the announcement.
Luis Alberto Garcia Perojo (Garcia), 43, previously pleaded guilty to an information charging him with conspiracy to commit health care fraud.    In addition to his prison term, he was sentenced to serve three years of supervised release and ordered to pay $6,248,056 in restitution, jointly and severally with his co-conspirators.
According to documents filed in the case, Garcia conspired with others to execute a health care fraud scheme through Renew Therapy Center of Port St. Lucie LLC (Renew Therapy), a comprehensive outpatient rehabilitation facility that he helped operate.    From November 2007 through August 2009, Renew Therapy submitted approximately $10,549,361 in fraudulent claims for reimbursement to Medicare for therapy services that were not legitimately prescribed and not legitimately provided to Medicare beneficiaries.    As a result of those fraudulent claims, Medicare deposited approximately $6,248,056 into a Renew Therapy bank account.    The fraud proceeds in that account were subsequently disbursed to various entities, including $1,847,222 to Ariguanabo Investment Group Inc. and IRE Diagnostic Center Inc.    Garcia was President of Ariguanabo Investment Group and had authority over bank accounts for Ariguanabo Investment Group and IRE Diagnostic Center, both of which were shell companies.    Garcia and others used this money from Renew Therapy for, among other purposes, paying kickbacks to obtain Medicare beneficiary identifying information that was used in Renew Therapy’s fraudulent reimbursement claims.

This case is being investigated by HHS-OIG and the FBI 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 Middle District of Florida.    This case is being prosecuted by Trial Attorney Christopher J. Hunter 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 1,900 defendants who have collectively billed the Medicare program for more than $6 billion.    In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

Two Former Chesapeake, Virginia, Subcontractors Sentenced for Bribery, Conspiracy

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Dwayne A. Hardman, 44, co-founder of two government contracting companies that sought business from the United States Navy Military Sealift Command (MSC), and Adam C. White, 40, former vice president and co-owner of one of Hardman’s government contracting companies, were sentenced for bribery and conspiracy.    On July 9, 2014, Hardman was sentenced to 96 months in prison, followed by three years of supervised release.    White was sentenced today to serve 24 months in prison, followed by three years of supervised release.    Hardman was ordered to forfeit $144,000, and White was ordered to forfeit $57,000.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, United States Attorney Dana J. Boente for the Eastern District of Virginia, Special Agent in Charge Royce E. Curtin of the FBI’s Norfolk Office, Acting Executive Assistant Director Charles T. May Jr. of the Naval Criminal Investigative Service (NCIS) and Special Agent in Charge Robert Craig of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office made the announcement today after sentencing by United States Chief Judge Rebecca Beach Smith of the Eastern District of Virginia.
According to court documents, Hardman and White participated in a five-year bribery scheme in which they and several co-conspirators provided more than $265,000 in cash bribes, among other things, to two public officials working for MSC, in an illegal effort to influence those public officials to provide favorable treatment to Hardman and White’s companies in connection with United States government contracting work.
On Feb. 18, 2014, Hardman pleaded guilty to a criminal information charging him with bribery.    According to the plea documents, Hardman was the co-founder of two government contracting companies, referred to as Company A and Company B, located in Chesapeake, Virginia that sought contracting business from MSC, which is the leading provider of transportation for the United States Navy.  At his plea hearing, Hardman admitted that beginning in March 2005, he and other Company A employees, provided approximately $3,000 in cash bribes per month to two MSC public officials, Kenny E. Toy, the former Afloat Programs Manager for the MSC’s N6 Command, Control, Communication, and Computer Systems Directorate, and Scott B. Miserendino Sr., a former government contractor who performed work for the MSC.  Those Company A employees included Roderic J. Smith, the former president, co-owner and co-founder of Company A; Adam C. White, a former vice president and co-owner of Company A; and Michael P. McPhail a former project manager and co-owner of Company A.  Hardman also admitted that in May 2009, he and Timothy S. Miller, co-founder of Company B, provided $50,000 in cash bribes to Toy and Miserendino.    In addition to the cash bribes, Hardman stated that he and his co-conspirators provided Toy and Miserendino flat screen televisions, a paid vacation to Nags Head in North Carolina, a personal loan and installation of hardwood floors in Toy’s residence.
In exchange for these bribes, Toy and Miserendino provided favorable treatment in connection with MSC-related business to both Company A and Company B.  During the bribery scheme, Company A received approximately $3 million in MSC-related business, and Company B received approximately $2.4 million in MSC-related business.
As part of his guilty plea, Hardman also admitted that, in approximately November or December 2010, Hardman threatened to report the bribery activities to law enforcement authorities if his co-conspirators did not provide him money.    In total, Hardman admitted that he received approximately $85,000 from his co-conspirators, including Smith, Toy and Miserendino, in exchange for not reporting the bribery scheme to law enforcement authorities.
On April 4, 2014, White pleaded guilty to a criminal information charging him with conspiracy to commit bribery.    At his plea hearing, White admitted that from approximately April 2005 until approximately March 2006, he personally contributed approximately $26,000 in cash bribe payments for Toy and Miserendino, and White was aware that other co-conspirators, including Hardman, Smith and McPhail, were also contributing cash and other things of value to be provided to Toy and Miserendino in exchange for their official assistance in providing MSC-related business.
Earlier this year, three other individuals pleaded guilty in connection with the bribery scheme.    On Feb. 12, 2014, Toy, the former Afloat Programs Manager, pleaded guilty to accepting bribes from Hardman, White, and others.    On Feb. 19, 2014, McPhail pleaded guilty to conspiracy to commit bribery.    On March 5, 2014, Smith pleaded guilty to conspiracy to bribe public officials.
On June 23, 2014, United States District Judge Henry Coke Morgan of the Eastern District of Virginia sentenced Smith to 48 months in prison followed by 1 year of supervised release and ordered him to forfeit $175,000.
On May 23, 2014, a grand jury in the Eastern District of Virginia indicted Miserendino and Miller.    The indictment charges Miserendino with one count of conspiracy to commit bribery, one count of bribery, one count of conspiracy to commit obstruction of criminal investigations and to commit tampering with a witness, and one count of obstruction of criminal investigations.    The indictment charges Miller with one count of conspiracy to commit bribery and two counts of bribery.    Trial is set for Sept. 30, 2014, before Chief Judge Rebecca Beach Smith of the Eastern District of Virginia.
The charges in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
The case was investigated by Special Agents of the FBI, NCIS, and DCIS.    The case is being prosecuted by Trial Attorney Emily Rae Woods of the Criminal Division’s Public Integrity Section and Assistant U.S. Attorney Stephen W. Haynie of the Eastern District of Virginia.

 

Four Patient Recruiters Plead Guilty in Miami for Roles in $20 Million Health Care Fraud Scheme

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Four patient recruiters pleaded guilty in connection with a $20 million health care fraud scheme involving Trust Care Health Services Inc. (Trust Care), a defunct home health care company.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Acting Special Agent in Charge Ryan Lynch of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office made the announcement.
At a hearing today before U.S. District Judge Darrin P. Gayles of the Southern District of Florida, Estrella Perez, 57, and Solchys Perez, 34, both pleaded guilty to conspiracy to commit health care fraud, and Abigail Aguila, 40, pleaded guilty to conspiracy to defraud the United States and receive health care kickbacks.    Sentencing for all three defendants is set for Sept. 18, 2014 in front of Judge Gayles.    On June 17, 2014, another co-defendant, Monica Macias, 52, pleaded guilty to conspiracy to defraud the United States and receive health care kickbacks before U.S. Magistrate Judge Chris M. McAliley of the Southern District of Florida.  Sentencing for Macias is set for Sept. 10, 2014 before Judge Gayles.
According to court documents, the defendants worked as patient recruiters for the owners and operators of Trust Care, a Miami home health care agency that purported to provide home health and physical therapy services to Medicare beneficiaries.    Trust Care was operated for the purpose of billing the Medicare Program for, among other things, expensive physical therapy and home health care services that were not medically necessary and/or were not provided.
The defendants recruited patients for Trust Care and solicited and received kickbacks and bribes from the owners and operators of Trust Care in return for allowing the agency to bill the Medicare program on behalf of the recruited Medicare patients.    These Medicare beneficiaries were billed for home health care and therapy services that were not medically necessary and/or were not provided.
Estrella Perez and Solchys Perez also paid kickbacks and bribes to co-conspirators in doctors’ offices and clinics in exchange for providing home health and therapy prescriptions, plans of care, and medical certifications for their recruited patients.    Co-conspirators at Trust Care then used these prescriptions, plans of care and medical certifications to fraudulently bill the Medicare program for home health care services.
From approximately March 2007 through at least January 2010, Trust Care submitted more than $20 million in claims for home health services.    Medicare paid Trust Care more than $15 million for these fraudulent claims.
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 Southern District of Florida.    This case is being prosecuted by Trial Attorneys A. Brendan Stewart and Anne P. McNamara 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 nearly 1,900 defendants who have collectively billed the Medicare program for more than $6 billion.  In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.