Anyone can become a fraud victim. By staying up-to-date on the latest fraud cases from the Department of Justice, the FBI, and credible news outlets, you can learn about different types of fraudulent activity, how to spot it, and how to keep yourself or your business from falling victim to a fraud scheme.
Read on to learn about January 2019 crime investigations and fraud cases from the United States Department of Justice.
Precious Metals & Securities Fraud
Read Article: Fort Lauderdale Broker Sentenced to More than Six Years in Prison for $16 Million Precious Metals and Securities Fraud Scheme
Southern District of Florida— Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office and Michael J. De Palma, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI) announced that Salvatore Colonna, 69, of Fort Lauderdale, was sentenced to 78 months in prison for his role in a $16 million precious metals and securities fraud scheme and ordered to pay approximately $13 million in restitution.
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Health Care Fraud
Read Article: Miami-Area Pharmacy Owner Sentenced to Over Seven Years in Prison for Role in $8.4 Million Medicare Fraud Scheme
Miami, FL – The owner of a Miami, Florida-area pharmacy who caused Medicare to pay more than $8.4 million over a six-year period for prescription drugs that were never provided to beneficiaries was sentenced to 87 months in prison.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Ariana Fajardo Orshan of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.
Antonio Perez Jr., 48, of Miami Beach, Florida, was sentenced by U.S. District Judge Federico A. Moreno of the Southern District of Florida, who also ordered Perez to pay $8,415,824 in restitution and to forfeit the same amount. Perez was ordered to forfeit four Miami-area properties worth approximately $700,000 and multiple bank accounts totaling over $250,000. Perez previously pleaded guilty to one count of conspiracy to commit health care fraud.
According to admissions made as part of his plea agreement, Perez was the owner of A.R.A. Medical Services Inc., which did business under the name Valles Pharmacy Discount. Perez admitted to agreeing to pay illegal health care kickbacks to Medicare beneficiaries in exchange for a promise from the beneficiaries to fill their prescriptions at Valles Pharmacy Discount, and to allow Valles Pharmacy Discount to submit claims to Medicare for prescription drugs that were not provided to the beneficiaries. Perez also admitted that he submitted claims to Medicare for expensive prescription medications that Valles Pharmacy never purchased and were never provided to Medicare beneficiaries.
During the course of the scheme, Medicare paid Valles Pharmacy Discount over $32 million, of which at least $8.4 million was for prescription drugs that Valles Pharmacy never purchased and never provided to Medicare beneficiaries, Perez admitted. Read More
Mortgage Fraud; Securities, Commodities, & Investment Fraud
Read Article: False Liens Yield 30-Month Sentence
Phoenix, AZ — David John Dziedzic, 55, of Scottsdale, Ariz., was recently sentenced by U.S. District Judge David G. Campbell to 30 months’ imprisonment for his lead role in criminal activity related to the short sale of distressed mortgages, some of which were federally-insured. Dziedzic had previously pleaded guilty to one count of communication of unregistered securities, and a separate count involving the failure to notify the Treasury Department of his collection of more than $10,000 in cash from a real estate customer.
Dziedzic operated the “Housing Angels” program through his company, Real Core Realty, LLC. He aggressively marketed a program designed to help homeowners stay in their homes following a short sale, through an undisclosed sale-leaseback program with “angel” investors. Through this program, he typically received commissions from both the buyer and the seller in a short sale transaction. Dziedzic also recorded false secondary liens on more than 100 short sale properties to induce banks holding primary mortgages to pay off the false secondary mortgages, resulting in more than $100,000 in illegal profits as a result of the scheme.
As part of the sentence, Dziedzic must give up his real estate license. He paid $107,280 in restitution for the actual loss caused when 40 banks paid out on the false liens, and he was also ordered to pay a money judgment of $142,000 over time, in order to disgorge additional profits. As part of the plea agreement, Dziedzic, a Canadian national who naturalized as a U.S. citizen during the investigation, agreed to cooperate in his denaturalization, because he had failed to disclose the existence of the investigation to U.S. Citizenship and Immigration Services during the naturalization process.
Dziedzic’s wife, Heather Hamilton Dziedzic, 43, pleaded guilty to a related misdemeanor
Financial Fraud
Read Article: Daycare Owner Sentenced For Stealing Government Funds
Buffalo, NY— U.S. Attorney James P. Kennedy, Jr. announced that Tariq Butt, 42, of Buffalo, NY, who was convicted of theft of government funds, was sentenced to serve 12 months in prison by U.S. District Judge Lawrence J. Vilardo. The defendant was also ordered to pay restitution totaling $305,000 to the Department of Health and Human Services.
Assistant U.S. Attorney Maura K. O’Donnell, who handled the case, stated that in February 2015, the defendant and his wife, Halima Mohammed, opened Twinkle Stars Day Care Center, and in July 2015, the couple opened Candyland Daycare, both located in the City of Buffalo.
Between January 2016 and September 2016, the defendant submitted hundreds of false and fraudulent claims to Erie County seeking reimbursement for daycare services supposedly provided by Twinkle Stars and Candyland to children eligible for Child Care and Development Block Grant funds from the U.S. Department of Health and Human Services. The defendant knew that the children listed on the claims did not actually attend Twinkle Stars on the dates and times claimed, making the daycare ineligible for reimbursement. In total, between January 2016 and September 2016, Erie County paid Twinkle Stars and Candyland approximately $305,000 for daycare services, which were never rendered. Read More
Financial Fraud; Securities, Commodities, & Investment Fraud
Read Article: Former Shaw Insider Sentenced to Federal Prison for Insider Trading
Middle District of Louisiana – United States Attorney Brandon J. Fremin announced that U.S. District Judge John W. deGravelles sentenced Kelly Liu, age 33, of Baton Rouge, Louisiana, to 16 months in federal prison following her convictions for securities fraud (insider trading) and conspiracy to commit securities fraud. The Court also sentenced Liu to pay a fine of $7,500 and to serve 1 year of supervised release following her term of imprisonment.
In May of this year, a jury found Liu and her two co-defendants guilty as charged in connection with an insider trading scheme related to the 2012 acquisition of the Shaw Group (“Shaw”) by Chicago Bridge and Iron Company (“CB&I”). According to evidence presented at trial, in mid-2012, Shaw was considering a potential merger opportunity. At the time, Liu was working in Shaw’s Financial Planning and Analysis Department on Essen Lane. In July 2012, Shaw and CB&I came to an agreement on an offer for CB&I to buy Shaw. This merger between the two companies was publicly announced on July 30, 2012 (“the public announcement”). As a result of the public announcement, Shaw’s stock price rose by around 55 percent.
The evidence at trial established that, prior to the public announcement and through her job at Shaw, Liu obtained inside information that Shaw was going to be acquired by another company. She subsequently passed the inside information to Victory Ho (“Ho”), through another individual, and to her former boyfriend, Salvador J. Russo, III (“Russo”), for their use in trading Shaw stock and options. Documents and testimony presented at trial also showed that, in the months leading up to the public announcement, Liu was assisting a Ho family business with obtaining financing and insurance on a real estate project in Morgan City, Louisiana.
Based on the information provided by Liu, Ho and Russo purchased Shaw stock and options before the public announcement. Through these purchases, Ho reaped almost $300,000, and Russo secured a profit of approximately $4,000 on a $5,000 investment.
On October 24, 2018, co-defendant Victory Ho, age 39, of Morgan City, was sentenced to 32 months in federal prison, ordered to forfeit over $300,000 and to pay a $15,000 fine, following his convictions in the same insider trading scheme.
On October 30, 2018, co-defendant Russo, age 35, of Baton Rouge, was sentenced to 16 months in federal prison following his convictions in the same scheme. Read More
Health Care Fraud
Read Article: Defendants In Louisville Area Chiropractic Scheme Sentenced To Federal Prison
Louisville, KY – U.S. District Judge Rebecca G. Jennings has sentenced defendants of a health care fraud scheme that billed insurance companies for services never performed to years in federal prison, announced United States Attorney Russell M. Coleman.
“This sentence sends a message that theft in the Western District of Kentucky – health care related or otherwise – results in real time in federal prison,” stated U.S. Attorney Russell Coleman
The Court sentenced Ledinson Chavez to 74 months in prison for health care fraud, money laundering, and aggravated identity theft. The sentence is followed by 2 years supervised release, and $1,016,393.23 in restitution. There is no parole in the federal system.
Sergio Betancourt was sentenced to 37 months imprisonment for health care fraud, money laundering and crimes committed while on pre-trial release. The sentence will be followed by 2 years supervised release, and $1,153,770.34 in restitution.
According to the evidence before the Court, beginning no later than on or about June 12, 2012, and continuing through on or about November 1, 2014, Claudia Lopez, Ledinson Chavez, Oskel Lezcano, Ariel Borrego-Hernandez, Sergio Betancourt and Yuriesky Diaz Rodriguez recruited unsuspecting chiropractors for employment in Louisville area chiropractic clinics in order to obtain and use the chiropractors’ names and National Provider Identifiers (NPI) to fraudulently bill insurance companies. Each chiropractor provided his/her NPI number to Lopez and Lezcano in order to credential the clinics with various insurance companies.
Thereafter, the group of defendants recruited employees from Jeffboat and other local employers to seek chiropractic services from the clinics. However, unbeknownst to the chiropractors, the clinics billed approximately $5,000,000 for methocarbamol injections (a muscle relaxant), using the patients’ names, dates of birth, insurance/policy numbers, addresses, and patient IDs/Social Security Numbers for injections. Most of the patients from Jeffboat were paid to go to the clinics by the defendants and were told the injections were being billed, according to testimony during trial.
According to additional court documents on or about March 14, 2017, and March 17, 2017, while on pre-trial release, Borrego and Lopez conspired to traffic in marijuana – which caused about 109 pounds of marijuana to be transported from Colorado to Kentucky. Read More
Veriti’s team of forensic accounting specialists and CPAs are uniquely qualified to assist clients with intricate accounting and litigation matters. If you suspect fraudulent activity, get in touch with the experts at Veriti Consulting. We provide specialty services to clients nationwide. Contact us at (877) 520-1280.
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Fraud News December 2018: Email Scams, Money Laundering, Public Corruption, and More
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Fraud News October 2018: Money Laundering, Bribery and Tax Evasion
