Month: April 2022

Source: United States Department of Justice News

Assistant U. S. Attorneys Valerie Chu (619) 546-6750 and Michelle L. Wasserman (619) 546-8431

NEWS RELEASE SUMMARY – April 13, 2022

SAN DIEGO – Elliot Adler, an attorney and founding partner of a boutique San Diego law firm, pleaded guilty in federal court today to conspiring with former Chabad of Poway Rabbi Yisroel Goldstein to commit tax fraud.

According to his plea agreement, Adler admitted that beginning at least as early as 2010 and continuing through October 2018, he participated in a so-called “90/10” tax scheme with Rabbi Goldstein. Specifically, Adler gave money to Rabbi Goldstein that purported to be a donation to Chabad of Poway. Goldstein then secretly funneled ninety percent of the funds back to Adler, keeping ten percent of the funds as his fee. None of the donated funds was actually given to the Chabad as a charitable donation.

Adler then falsely claimed that the fraudulent donations were tax-deductible on his tax returns, allowing him to reduce his personal income tax liability by approximately $500,000 (cumulatively) for tax years 2011 through 2017. 

To accomplish the scheme, Adler and Goldstein communicated using coded language. Goldstein would refer to cash as “challah,” the source of the cash as “the baker,” and would invite co-conspirators to “wrap tefillin” when he proposed meeting to receive checks or deliver cash.  For example, on Thursday, January 7, 2016, Goldstein texted Adler, “Good morning I got the challah[.] What time?”  That same day, Adler replied via text message, “Monday morning 8am at shul or today before 12pm if you can come to my office.”  Goldstein then replied, “Monday @8 is fine.”  On Monday, January 11, 2016, Goldstein deposited a check from Adler for $30,000 payable to Chabad of Poway. 

On or about December 29, 2017, Goldstein deposited two sequentially numbered checks from Adler, one for $180,000 and the other for $980,000.  On Friday, January 5, 2018, Goldstein sent Adler a coded text message proposing that they “get together and wrap teffilin.” A few days later, on January 10, 2018, Goldstein wired approximately $1million to a wholesale and retail jeweler to purchase 246 Suisse Fortuna 1 oz. rectangular gold ingots, 246 Canadian Maple Leaf 1 oz. gold coins, and 246 American Eagle 1 oz. gold coins.  On January 17, 2018, Goldstein sent another coded message to Adler asking him, “[w]hen can you come [i]n for a teffilin wrap?  I’m ready for you.” Goldstein delivered the gold to Adler the next day.  Adler nonetheless claimed on his 2017 tax returns that he had donated over $1 million to charity, fraudulently reducing his 2017 tax liability by approximately $447,000. 

Adler and Goldstein took additional steps to conceal their scheme from authorities. On or about October 18, 2018, Goldstein told Adler that he was under investigation by the IRS and that he had been the subject of an undercover operation relating to tax evasion. Goldstein asked for Adler’s help to prove, falsely, that Goldstein, and not Adler, was in possession of the gold coins purchased with Adler’s purported donation.  In the early hours of October 19, 2018, Adler arrived at Goldstein’s residence and returned the gold coins. 

In July 2020, Rabbi Goldstein pleaded guilty to fraud charges, admitting that he participated in a complex, years-long, multi-million-dollar tax-evasion scheme and other financial deceptions involving theft of public money.  Rabbi Goldstein’s plea agreement outlined the fraud scheme with Adler.

Adler is the eleventh individual to plead guilty to crimes discovered in this investigation. Two additional individuals agreed to deferred prosecution agreements as a result of the investigation. 

“Elliot Adler conspired to commit a $500,000 tax fraud through phony religious donations,” said U.S. Attorney Randy S. Grossman. “Tax fraud is a serious crime that directly impacts our communities, and the U.S. Attorney’s Office is committed to working with the IRS, FBI and our other law enforcement partners to bring those responsible to justice.” Grossman thanked the prosecution team and agents for their hard work on this case.

“This defendant was part of an elaborate, years-long financial scheme to fraudulently claim charitable contributions in an effort to avoid paying taxes,” said FBI Special Agent in Charge Stacey Moy. “The FBI and our federal partners will continue to vigorously pursue those who abuse tax laws for their own financial gain – which also diminishes the public’s trust in charitable giving and hurts the organizations who rely on such donations.”  

“For years, Mr. Adler shirked his duty to pay his fair share and then he doubled-down in a failed attempt to cover up his million-dollar tax fraud with Rabbi Goldstein,” said Special Agent in Charge Ryan L. Korner of IRS Criminal Investigation’s Los Angeles Field Office. “Tax revenue funds our critical infrastructure, our national defense and pays for social programs like health care, education and social security. A one percent increase or decrease in tax compliance equates to approximately $35 billion in tax revenue used to serve the American public. IRS Criminal Investigation is committed to rooting out tax schemes and working with our law enforcement partners to bring financial fraudsters to justice.”

Adler is next scheduled to appear at a sentencing hearing on July 11, 2022, before Judge Cynthia Ann Bashant.

SUMMARY OF CHARGES                        Case Number 22cr0821

Elliott Adler                                                   Age: 45                       San Diego, CA

Conspiracy to Commit Tax Fraud, in violation of Title 18, USC 371

Maximum Penalty: Five years in prison

PREVIOUSLY CHARGED DEFENDANTS AND SUMMARY OF CHARGES                     

Yisroel Goldstein, Case Number 20CR1916-BAS             Age: 58            Poway

Conspiracy to Defraud the United States and Commit Wire Fraud, in violation of Title 18, USC 371

Maximum Penalty: Five years in prison

Alexander Avergoon, Case Number 19CR2955-BAS       Age: 44            San Diego                  

Wire Fraud, in violation of Title 18, USC 1343

Maximum Penalty: Twenty years in prison

Aggravated Identity Theft, in violation of Title 18, USC 1028A

Maximum Penalty: Two years minimum consecutive term in prison

Money Laundering, in violation of Title 18, USC 1956(a)(1)(B)(i)

Maximum Penalty: Twenty years in prison

Bruce Baker, Case Number 20CR1912-BAS                     Age: 74            La Jolla

Conspiracy to Defraud the United States and file false tax returns, in violation of Title 18, USC 371

Maximum Penalty: Five years in prison

Bijan Moossazadeh, Case Number 20CR1893-BAS          Age: 63            San Diego

Filing a False Tax Return, in violation of Title 26, USC 7206(1)

Maximum Penalty: Three years in prison

Yousef Shemirani, Case Number 20CR1895-BAS            Age: 74            Poway

Filing a False Tax Return, in violation of Title 26, USC 7206(1)

Maximum Penalty: Three years in prison

Boris Shkoller, Case Number 20CR1913-BAS                  Age: 83            Del Mar

Filing a False Tax Return, in violation of Title 26, USC 7206(1)

Maximum Penalty: Three years in prison

Mendel Goldstein, Case Number 20CR2772-BAS             Age: 63            Brooklyn, NY

Conspiracy to Defraud the United States and Commit Wire Fraud, in violation of Title 18, USC 371

Maximum Penalty: Five years in prison

Stuart Weinstock, Case Number 21CR0042-BAS             Age:    64            Escondido, CA

Filing False Tax Return, in violation of Title 26, U.S.C. §7206(1)

Maximum Penalty: Three years in prison

Jason Ellis, Case Number 21CR2200-BAS             Age: 42            Poway, CA

Filing False Tax Return, in violation of Title 26, U.S.C. §7206(1)

Maximum Penalty: Three years in prison

Yehuda Hadjadj, Case Number 22CR148-BAS    Age: 47           La Jolla, CA

Conspiracy to Commit Wire Fraud, in violation of Title 18, USC 371

Maximum Penalty: Five years in prison

Rotem Cooper, Case Number 20CR3968-BAS                  Age:    54            San Diego      

Deferred Prosecution Agreement

Conspiracy to Commit Wire Fraud, in violation of Title 18, USC 371

Igor Shtilkind, Case Number 20CR3955-BAS                   Age:    55            San Diego

Deferred Prosecution Agreement

Conspiracy to Commit Wire Fraud, in violation of Title 18, USC 371

INVESTIGATING AGENCIES

Federal Bureau of Investigation

Internal Revenue Service

Source: United States Department of Justice News

Gregory Evans, 50, a former Captain with the Madison County Detention Center, in Richmond, Kentucky, pleaded guilty today to using unreasonable force against a detainee, thereby violating the detainee’s civil rights. Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division and U.S. Attorney Carlton S. Shier IV made the announcement.

According to court documents and admissions made during the plea hearing, Evans was escorting the victim, E.B., down a hallway when Evans grabbed E.B. out of anger, strangled him, and repeatedly punched him. Evans’s assault caused E.B. to lose consciousness, and Evans then punched E.B. in the back and face while E.B. was unconscious. E.B. suffered a broken jaw as a result of the assault. Evans was aware that chokeholds were banned at Madison County Detention Center and that punching and strangling E.B. out of anger was an unreasonable use of force. Following the assault, Evans falsified an incident report and made false statements to the FBI. Specifically, Evans falsely claimed that he had ordered E.B. to turn around prior to the assault, that E.B. ignored his commands, and he deliberately omitted the fact that he had strangled E.B.

“The defendant is being held accountable for using excessive force to assault and strangle a man out of anger,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Civil Rights Division will continue to investigate and prosecute law enforcement officials who deprive individuals of their Constitutional rights.”

“When members of law enforcement engage in excessive force, they not only victimize an individual but do grave disservice to the dedicated work of so many others who honorably serve the public,” said U.S. Attorney Carlton S. Shier IV for the Eastern District of Kentucky. “Investigating and prosecuting this conduct is critically important, both to the victims and the Constitutional rights of all individuals.”  

“Corrections officers have extremely difficult jobs; however, our community demands these officers conduct themselves professionally,” said Special Agent in Charge Jodi Cohen of the FBI Louisville Field Office. “Today’s guilty plea is a reminder that the FBI and the Department of Justice will aggressively investigate and prosecute public officials found to have abused those they have been sworn to protect.”

The crime Evans pleaded guilty to carries a maximum sentence of 10 years imprisonment and a $250,000 fine. Evans is scheduled to be sentenced on July 29.

This case was investigated by the FBI’s Lexington RA, and is being prosecuted by Assistant U.S. Attorney Zachary Dembo for the Eastern District of Kentucky and Trial Attorney Andrew Manns of the Justice Department’s Civil Rights Division.

Source: United States Department of Justice News

A federal jury convicted a Florida woman today in a health care fraud scheme that billed private health insurers more than $58 million for services that were never provided and were not medically necessary.

According to court documents and evidence presented at trial, Carie Lyn Beetle, 44, of Lake City, with others, unlawfully billed health insurers for over $58 million of addiction treatment services that were never rendered and/or were medically unnecessary at two facilities she operated: Real Life Recovery Delray LLC (RLR), a substance abuse treatment center, and A Safe Place LLC, dba Halfway There Florida LLC (HWT), a related recovery residence, also referred to as a “sober home.” 

The evidence showed that Beetle and her co-conspirators recruited patients by providing them with kickbacks and bribes in the form of free or reduced rent, payment for travel, and other benefits in exchange for those patients agreeing to reside at HWT, attend drug treatment at RLR, and submit to regular and random drug testing (typically two or three times per week) at RLR and HWT. Beetle and her co-conspirators then billed the patients’ insurance plans for the substance abuse treatment and urine testing services the patients were purportedly receiving. In many instances, individual patients did not attend the billed treatment session. On such occasions, Beetle and her co-conspirators caused employees and patients of HWT/RLR to forge patients’ signatures on sign-in sheets to make it appear as though absent patients had attended treatment. In addition, Beetle and her co-conspirators caused expensive medically unnecessary urine testing to be billed for patients knowing that the tests were excessive, not used in treatment, and not reviewed by medical professionals.

The evidence further showed that Beetle laundered the proceeds knowing they derived from fraud and other crimes when she deposited a check from RLR. 

Beetle was convicted of one count of conspiracy to commit health care fraud and wire fraud, and one count of money laundering. She is scheduled to be sentenced later this year and faces a maximum sentence of 20 years in prison on the conspiracy count and up to 10 years in prison on the money laundering count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division; Special Agent in Charge George L. Piro of the FBI’s Miami Field Office; Deputy Chief James D. Robnett of IRS-Criminal Investigation (IRS-CI); and Special Agent in Charge Matthew D. Line of IRS-CI’s Miami Field Office made the announcement.

The FBI, IRS-CI, the Florida Bureau of Insurance Fraud, and Amtrak Office of Inspector General investigated the case.

Senior Litigation Counsel Jim Hayes and Trial Attorneys Ligia Markman and Reginald Cuyler Jr. of the Criminal Division’s Fraud Section are prosecuting the case.

The National Rapid Response Strike Force and Los Angeles Strike Force lead the Department of Justice’s Sober Homes Initiative, which was announced in the 2020 National Health Care Fraud Takedown to prosecute defendants who exploit vulnerable patients seeking treatment for drug and/or alcohol addiction.

Source: United States Department of Justice News

In an indictment unsealed today, a federal grand jury in Chicago charged an Illinois woman with conspiring to defraud the United States and helping clients file false tax returns with the IRS.

According to the indictment, Stephanie Fagairo, of Frankfort, owned Double Vision Tax Service, a return preparation business. From 2014 through 2017, Fagairo and one of her employees allegedly conspired to file false tax returns for a number of Double Vision clients. They allegedly did so by including on client tax returns false Schedules C, which reported to the IRS fabricated business income and loss amounts in order to generate inflated refunds the clients were not entitled to receive. Fagairo also allegedly instructed other individuals on how to prepare false tax returns for clients.

Fagairo’s initial court appearance has not yet been scheduled. If convicted, Fagairo faces a maximum sentence of five years in prison for the conspiracy count and three years in prison for each of 11 counts of helping her clients file a false tax return. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney John R. Lausch, Jr. for the Northern District of Illinois made the announcement.

IRS-Criminal Investigation is investigating the case.

Assistant Chief Andrew Kameros and Trial Attorney Eric Taffet of the Justice Department’s Tax Division are prosecuting the case.

An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Source: United States Department of Justice Criminal Division

A New York woman was sentenced today to 78 months in prison for defrauding health care programs, including more than $6.5 million from Medicare Part D plans and Medicaid drug plans.

According to court documents, Aleah Mohammed, 37, of Queens, pleaded guilty to one count of mail fraud, one count of health care fraud, and one count of conspiracy to commit health care fraud.

According to court documents, Mohammed was an owner and operator of five pharmacies: Superdrugs Inc., Superdrugs I Inc., Superdrugs II Inc., S&A Superdrugs II Inc. and Village Stardrugs Inc. Between 2015 and 2020, Mohammed used these pharmacies to defraud health care programs, including Medicare and Medicaid, by submitting claims for prescription drugs that were not dispensed, not prescribed as claimed, not medically necessary, or that were purportedly dispensed during a time when the pharmacy was no longer registered with the State of New York. The fraudulent claims included claims for expensive prescription drugs for the treatment of the human immunodeficiency virus (HIV). Mohammed used proceeds of the scheme to purchase herself luxury items, such as jewelry and a Porsche.  

Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Breon Peace for the Eastern District of New York; Special Agent in Charge Scott J. Lampert of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Office of Investigations; Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division; and Assistant Director-in-Charge Michael J. Driscoll of the FBI’s New York Field Office made the announcement. 

HHS-OIG and the FBI investigated the case.

Trial Attorneys Andrew Estes and Patrick J. Campbell of the Criminal Division’s Fraud Section prosecuted the case.