Month: May 2022

Source: United States Department of Justice News

The Justice Department announced that it has agreed to settle its complaint against the Illinois Department of Corrections, which alleged that the IDOC violated the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) by failing to properly reemploy Illinois Air National Guard Reservist Roderick Workman in his proper “escalator position” following his return from military service.

“Those who serve in our Armed Forces make incredible sacrifices on behalf of our country and the Justice Department remains committed to enforcing civil rights laws that protect them in their civilian careers,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “Reservists who leave their jobs to serve our country should not lose employment and advancement opportunities when they return from duty. The department will vigorously enforce USERRA to ensure reservists are placed in their rightful positions.” 

In its complaint, the United States alleged that the IDOC failed to properly reemploy Workman as a Correctional Transportation Officer I (CTO I) when he returned from military service in December 2019. USERRA requires employers to reemploy eligible employees returning from military service in their “escalator position,” which is the job it is reasonably certain the employee would have been in had he or she not been called to military service. The United States claimed the CTO I position, which became available during Workman’s military absence, was his escalator position because he was qualified for the position and tried to apply for the position before he left for military duty, and IDOC would have selected Workman had he been there to bid based on his seniority and qualifications.

Under the terms of the consent decree, subject to court approval, the IDOC will pay Workman $9,026.71 in backpay and interest, make changes to its policies, and conduct comprehensive training on USERRA for its employees.

Trial Attorneys Dena Robinson and Hillary Valderrama of the Civil Rights Division’s Employment Litigation Section handled this matter.

The Justice Department gives high priority to the enforcement of servicemembers’ rights under USERRA. Additional information about USERRA can be found on the Justice Department’s websites at www.justice.gov/crt-military/employment-rights-userra and www.justice.gov/servicemembers as well as on the Department of Labor’s website at www.dol.gov/vets/programs/userra.

Source: United States Department of Justice News

Damian Williams, the United States Attorney for the Southern District of New York, announced that RULESS PIERRE was sentenced to 84 months in prison yesterday in connection with his Ponzi-like securities fraud schemes that primarily targeted PIERRE’s own Haitian community in Rockland County, New York.  PIERRE was convicted of securities fraud, wire fraud, and structuring offenses after a jury trial in May 2021 before U.S. District Judge Sidney Stein, who imposed the sentence. 

U.S. Attorney Damian Williams said:  “Ruless Pierre violated the trust of his closest friends and fellow community members.  Pierre’s brazen lies caused many of his victims not only financial losses, but long-lasting emotional damage as well.  This sentence achieves some measure of justice for Pierre’s victims and puts fraudsters on notice that we will protect investors from those that would violate their trust.”   

According to the Complaint, the Indictment, and the evidence presented at trial: 

Investment Promissory Fraud

From at least November 2016 through October 2019, PIERRE solicited money from investors in Ruless Pierre Consulting Group (“RPCG”) by falsely promising them that he would earn a 20% return on their initial investment every 60 days through stock trading (the “Promissory Note Fraud”).  The investments were written down in documents known as “Investment Promissory Notes.”  These investment contracts generally promised that the investor would be paid 20% interest every 60 days and that the investor could withdraw all funds from the investment with 30 days’ notice.  Based on these documents and the false representations of PIERRE, the investors understood that their principal and interest were guaranteed.  

During the course of the investment fraud scheme, PIERRE fraudulently obtained over $2 million from approximately 100 investors.  After receiving money from investors, PIERRE deposited the money into one of his personal bank accounts or bank accounts of RPCG.  PIERRE then transferred the money to trading accounts, where he engaged in unprofitable day trading.  Despite his trading losses, PIERRE repeatedly and falsely represented to investors, including in investment statements containing fictitious balances, that the trading was profitable and that their investments were growing as promised.  In addition to losing their money, PIERRE also used investors’ funds to pay for personal expenses, including luxury vehicles.  Additionally, PIERRE further concealed the truth from investors by using money obtained from new investors to make redemption payments to previous investors, in Ponzi-like fashion.

The Franchise Investment Fraud

Beginning in or about November 2018, PIERRE began to offer investors, including some individuals who invested in his Promissory Note Fraud, the opportunity to purchase partnership interests in a partnership that would run three fast-food franchise locations (hereinafter, the “Franchise Investment Fraud”).   At the time, PIERRE did not own any of the fast-food franchises, but he was in discussions regarding purchasing them.  Each investment was memorialized in a document entitled “Silent Partnership Agreement.” 

The Silent Partnership Agreements promised the investors a 5% monthly return on the investment, in addition to a 40% pro rata share of the quarterly gross operating profit.  The minimum investment was $5,000. 

The Silent Partnership Agreements further provided that PIERRE was the General Partner, and that he was responsible “for the complete management, control, and policies related to the operation and conduct of the business.”

PIERRE received financial statements for the franchise locations, which showed minimal profits.  Nonetheless, PIERRE promised investors an unrealistic 5% monthly return on their investment.

In or about April 2019, PIERRE purchased one fast food franchise for approximately $50,000.  Pierre did not purchase the other franchises.

PIERRE deposited the fast-food franchise investors’ money in various bank accounts, which commingled the funds from the Franchise Investment Fraud with the Promissory Note Fraud.  In Ponzi-like fashion, PIERRE fraudulently misappropriated some of the fast-food franchise investors’ money to pay back investors in the Promissory Note Fraud.

In total, PIERRE raised at least $200,000 by selling the Silent Partnership Agreements to at least 18 investors.  Some of the investors were paid their five percent monthly distribution, but the vast majority of the investors were not been made whole.  The fast-food franchise went out of business in December 2019.

The Embezzlement Fraud Scheme and Structuring

In the another scheme, PIERRE embezzled money from his former employers.  From approximately 2007 until February 2016, PIERRE was the director of finance for two different hotels, which were owned by the same company (“Company-1”).  One hotel was located in the Palisades, New York (“Hotel-1”), while the other was located in Armonk, New York (“Hotel-2”) (collectively, “the Hotels”).   As the director of finance, PIERRE was the signatory on several bank accounts held in the name of the management companies that managed the Hotels (“Management Companies”). 

After August 2018, PIERRE no longer worked at either Hotel-1 or Hotel-2, but he regularly wrote himself checks payable to cash from the Management Companies’ bank accounts.  Specifically, from September 2018 through March 2019, PIERRE wrote over 70 checks to “cash” or “petty cash” from one of the bank accounts for Hotel-1, for over $300,000.

In addition, from March 2017 through 2019, PIERRE deposited large amounts of cash into his personal bank accounts in amounts that were generally less than $10,000.  The deposits were conducted at various bank locations and typically took place on the same day, consecutive days, or within a short period of time.  For example, in just seven months, from June 2018 through December 2018, PIERRE deposited approximately $225,612, through 138 cash deposits all under $10,000, into a bank account in the name of RPCG.

*                *                *

In addition to the prison term, PIERRE, 52, of Nanuet, New York, was sentenced to 3 years of supervised release and was ordered to pay forfeiture in the amount of $3,701,893.91 and restitution to victims in the amount of $2,030,337.32.

Mr. Williams praised the outstanding investigative work of Homeland Security Investigations and thanked the United States Postal Inspection Service, the United States Internal Revenue Service, the New York City Police Department, and the New York City Sherriff’s Office, which assisted in the investigation.  Mr. Williams also thanked the Securities and Exchange Commission, which has brought and filed a civil enforcement action against the defendant. 

This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Drew Skinner is in charge of the prosecution.

Source: United States Department of Justice News

ALEXANDRIA, Va. – Latifa Brooks, a resident of McLean, has agreed to pay $107,347 to settle a civil fraud case alleging that she fraudulently applied for and received two Paycheck Protection Program (PPP) loans and subsequently fraudulently obtained forgiveness on both loans. 

On March 31, 2022, the United States filed a Complaint against Brooks under the False Claims Act (FCA) and the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA). According to the allegations in the Complaint, in April 2021, Brooks obtained two PPP loans, totaling $42,601, based on her asserted status as an independent contractor and the sole proprietor of Superb Movers, Inc. The United States alleged Brooks listed false gross income amounts and submitted fake tax returns in support of the PPP applications. In September 2021, Brooks obtained forgiveness for both PPP loans through allegedly falsely certifying compliance with all PPP rules and requirements.

As a part of this resolution, Brooks agreed to repay $47,772 for the loan forgiveness amounts and processing fees that the Government paid because of Brooks’ allegedly false claims and statements, and an additional $59,575 to settle the United States’ claims for treble damages under the FCA and civil penalties under the FCA and alternatively the FIRREA. The Complaint filed by the United States is a result of EDVA’s ongoing effort to use data analysis to proactively identify fraudulently obtained PPP loans.

The resolutions obtained in this matter were the result of a coordinated effort between the U.S. Attorney’s Office for the Eastern District of Virginia and the Small Business Administration.

The matter was investigated by Assistant U.S. Attorneys William Hochul and Krista Anderson.

On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

The civil claims settled by this agreement are allegations only; there has been no determination of civil liability.

Related court documents and information from the civil lawsuit are available on PACER by searching for Case No. 1:22-cv-00359. A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia.