Month: June 2022

Source: United States Department of Justice News

NEWARK, N.J. – A New York doctor today admitted participating in a health care fraud scheme to defraud Amtrak, distribution of a controlled substance in furtherance of that scheme, and the unlawful possession of a firearm, U.S. Attorney Philip R. Sellinger announced.

Michael DeNicola, 59, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an information charging him with conspiracy to commit health care fraud, distribution of a controlled substance, and unlawful possession of a firearm.

According to documents filed in this case and statements made in court:

From 2019 to August 2021, DeNicola and his conspirators agreed to engage in a scheme to bill the Amtrak health care plan for fraudulent claims for services that either were never provided or were medically unnecessary. They would recruit Amtrak employees to participate in the scheme by paying them to allow the conspirators to use their patient and insurance information to submit false and fraudulent claims. DeNicola and his conspirators submitted false and fraudulent claims that caused Amtrak losses of more than $1.6 million.

DeNicola also provided oxycodone prescriptions to an individual in return for the individual’s agreement to allow his patient and insurance information to be used for the submission of fraudulent insurance claims. DeNicola provided oxycodone prescription to others at the direction of this individual and did so outside of the usual course of professional treatment and without legitimate medical purpose. From April 2017 through February 2018, DeNicola issued 64 oxycodone prescriptions in this manner.

DeNicola also unlawfully possessed a firearm on Sept. 1, 2019, after previously having been convicted in a court of a crime punishable by a term of imprisonment exceeding one year.

The conspiracy to commit health care fraud and unlawful possession of a firearm charges each carry a maximum potential penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greatest. The distribution of a controlled substance charge carries a maximum potential penalty of 20 years in prison and a $1million fine, or twice the gross gain or loss from the offense, whichever is greatest. Sentencing is scheduled for Nov. 22, 2022.

U.S. Attorney Sellinger credited special agents of the Amtrak Office of Inspector General, under the direction of Special Agent in Charge Michael J. Waters; special agents of the  Drug Enforcement Administration, under the direction of Special Agent in Charge Frank A. Tarentino III in New York; special agents of the FBI, under the direction of Assistant Director in Charge Michael J. Driscoll in New York; the U.S. Food and Drug Administration Office of Criminal Investigations, under the direction of Acting Special Agent in Charge Bradley Greenberg; postal inspectors of the U.S. Postal Inspection Service in Newark, under the direction of Postal Inspector in Charge Damon Wood, Philadelphia Division; and the Amtrak Police Department, under the direction of Chief of Police Samuel Dotson, with the investigation, leading to today’s guilty plea.

The government is represented by Assistant U.S. Attorney Katherine Romano of the Health Care Fraud Unit in Newark and Daniel V. Shapiro, Deputy Chief of the Criminal Division.

Source: United States Department of Justice News

INDIANAPOLIS – Eleven defendants have been sentenced to federal prison after pleading guilty to federal crimes for their involvement in drug trafficking activities in the Indianapolis area.

Beginning in the fall of 2019, federal agents began investigating several individuals for their suspected drug trafficking activities in the Indianapolis area. As the investigation progressed, investigators discovered that methamphetamine was being transported from Muncie, Indiana to Vans Auto Repair in Indianapolis to be distributed. At the conclusion of the investigation, eleven defendants were charged in three different indictments for various drug trafficking charges.

On August 3, 2020, sixteen search warrants and federal arrest warrants were executed by federal agents and officers with the Indianapolis Metropolitan Police Department in the Indianapolis area. As a result of those search warrants, 31 illegally possessed firearms, 4½ pounds of methamphetamine; ½ kilogram of cocaine; 1 kilogram of fentanyl, and approximately $272,000 in cash drug trafficking proceeds were seized and taken off city streets. Each of the defendants pleaded guilty, and were sentenced, as follows:

Defendant	Sentence	Charge(s)
Travis Beechler, 27, Indianapolis, IN	30 years in federal prison 5 years supervised release	Distribution of Methamphetamine & Heroin; Possession of a Firearm by Felon & During a Drug Trafficking Crime
Antonio Turner, 34, Indianapolis, IN	15 years in federal prison 5 years supervised release	Distribution of Methamphetamine & Fentanyl
Stephen Cole, 45, Indianapolis IN	Over 24 years in federal prison 5 years supervised release	Distribution of Methamphetamine & Fentanyl; Money Laundering
Christopher Shelton, 43, Indianapolis, IN	Over 21 years in federal prison 5 years supervised release	Distribution of Methamphetamine
Scott Nelson, 39, Indianapolis, IN	10 years in federal prison 5 years supervised release	Distribution of Methamphetamine
Joshua Douglas, 40, Indianapolis, IN	16 years in federal prison 10 years supervised release	Distribution of Methamphetamine
Marguerite Collins, 47, Indianapolis, IN	Over 4 years in federal prison 3 years supervised release	Distribution of Methamphetamine
Jarrad Cooney, 34, Indianapolis, IN	Over 4 years in federal prison 3 years supervised release	Distribution of Methamphetamine
Jason Corey, 49, Indianapolis, IN	6 years in federal prison 4 years supervised release	Distribution of Methamphetamine
Halton Butler, 70, Indianapolis, IN	Over 2 years in federal prison 2 years supervised release	Distribution of Methamphetamine
Gary Hatcher Jr., 33, Indianapolis, IN	Over 20 years in federal prison 5 years supervised release	Distribution of Methamphetamine

“Traffickers of methamphetamine and fentanyl further the devastating cycle of substance abuse disorder to satisfy their own greed,” said U.S. Attorney Zachary A. Myers. “These prosecutions and sentences demonstrate that we will work tirelessly with our federal and local law enforcement partners to hold the traffickers of these dangerous and deadly drugs accountable for the pain they inflict on our communities.”

“The laundering of illegal drug profits is as important and essential to drug traffickers as the very distribution of their illegal drugs. Without these ill-gotten gains, the traffickers could not finance their organizations,” said Justin Campbell, Special Agent in Charge, Chicago Field Office, IRS Criminal Investigation. “Today’s sentencing shows that we are committed, now more than ever, to take the profit away from drug traffickers, to stop the flow of drugs into communities, and to put traffickers and money launderers in prison.”

The Federal Bureau of Investigation, the IRS Criminal Investigations, and the Indianapolis Metropolitan Police Department investigated the case. The DEA, and the U.S. Postal Inspection Service provided invaluable assistance.

U.S. Attorney Myers thanked Assistant U.S. Attorney Michelle P. Brady who prosecuted the case.

These prosecutions are the result of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.

Source: United States Department of Justice News

PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Marques Russell, 37, of Philadelphia, PA, was sentenced to seven years in prison, three years of supervised release, and was ordered to pay a $3,100 special assessment and forfeiture of $129,600 by United States District Judge C. Darnell Jones, II, for his role in an inter-state prescription forgery ring.

In October 2021, the defendant pleaded guilty to 31 counts of possession with intent to distribute oxycodone. The charges stem from Russell’s participation in a forged prescription ring, in which he and others presented fake prescriptions, forging doctors’ signatures, to pharmacies in order to obtain large amounts of oxycodone for illegal resale. The defendant admitted to presenting such prescriptions on 31 occasions to pharmacies in Drexel Hill and Kennett Square, PA. Over a roughly two-year period from about February 2017 through May 2019, Russell obtained 4,320 oxycodone tablets totaling 129,600 milligrams. The defendant was charged by Indictment in 2019, along with eleven others who presented forged prescriptions, and one complicit pharmacist in New Jersey.

“Pharmacies and pharmacists have a responsibility to serve as gatekeepers of a closed system of prescription drug distribution. This defendant and his co-conspirators took advantage of that system to flood the streets of our region with dangerous opioid drugs, no doubt exacerbating the epidemic,” said U.S. Attorney Romero. “Our Office will continue to investigate and prosecute healthcare fraud crimes like this in an effort to deter such conduct and keep our communities safe.”

The case was investigated by the U.S. Drug Enforcement Administration and the Easttown Township Police Department, and is being prosecuted by Assistant United States Attorney David E. Troyer.

Source: United States Department of Justice News

Damian Williams, the United States Attorney for the Southern District of New York, announced that LEV PARNAS was sentenced today in Manhattan federal court by United States District Judge J. Paul Oetken to 20 months in prison for conspiring to make political contributions by a foreign national along with solicitation and aiding and abetting the making of the same, conspiring to make straw donations, participating in a wire fraud conspiracy, and making false statements and falsifying records.  PARNAS was previously found guilty on October 22, 2021 following a two-week jury trial on campaign finance and false statements offenses, and pled guilty to participating in a wire fraud conspiracy on March 25, 2022. 

U.S. Attorney Damian Williams said:  “Parnas will now serve time in prison for his many crimes.  Not content to defraud investors in his business, Fraud Guarantee, out of more than $2 million dollars, Parnas also defrauded the American public by pumping Russian money into U.S. elections and lying about the source of funds for political contributions.  My office will continue to aggressively prosecute those who put their personal and financial gain above their country and their investors.”

According to the allegations in the Indictment, court documents, and evidence presented at trial:

The Foreign Donor Scheme

In the spring of 2018, PARNAS, Igor Fruman, Andrey Kukushkin and Andrey Muraviev, a Russian oligarch, decided to launch a business aimed at acquiring retail cannabis licenses in the United States. As part of that plan, Muraviev agreed to wire $1 million, through a series of bank accounts, to Fruman and PARNAS to fund hundreds of thousands of dollars in political contributions they had made or promised to make before the election in November 2018.  The purpose of the donations was to curry favor with candidates that might be able to help PARNAS and his co-conspirators obtain cannabis and marijuana licenses.  To obscure the fact that Muraviev was the true donor of the money, the funds were sent to a business bank account controlled by Fruman’s brother, and then the donations were made in PARNAS’s and Fruman’s names.

The Straw Donor and False Statements Scheme

In March 2018, PARNAS and Fruman began attending political fundraising events in connection with federal elections and making substantial contributions to candidates, joint fundraising committees, and independent expenditure committees with the purpose of enhancing their influence in political circles and gaining access to politicians. 

In May 2018, to obtain access to exclusive political events and gain influence with politicians, PARNAS and Fruman made a $325,000 contribution to an independent expenditure committee.  PARNAS and Fruman also made thousands of dollars in contributions to a federal candidate and a joint fundraising committee.  Despite the fact that the Federal Election Commission (“FEC”) forms for these contributions required PARNAS and Fruman to disclose the true donor of the funds, they falsely reported that the $325,000 contribution came from Global Energy Producers, a purported liquefied natural gas import-export business that was incorporated by PARNAS and Fruman around the time the contributions were made.  PARNAS also falsely stated on contribution forms that contributions to the federal candidate and joint fundraising committee were paid for by him.  In truth and in fact, the donations did not come from Parnas or GEP funds.  Rather, the contributions were all straw donations paid for by Fruman. 

In response to a complaint filed with the FEC regarding the $325,000 contribution to the independent expenditure committee, and to further conceal the true source of the funds used to make certain of their donations, in or about October 2018, PARNAS and Fruman submitted sworn affidavits to the FEC that contained false statements, including that the $325,000 contribution “was made with GEP funds for GEP purposes” and that  “GEP is a real business enterprise funded with substantial bona fide capital investment; its major purpose is energy trading, not political activity.”

The Fraud Guarantee Scheme

Between in or about late 2012 and in or about mid-2019, PARNAS and David Corriea conspired to defraud multiple victims by inducing them to invest in their company, known as “Fraud Guarantee,” based on materially false and misleading representations.  Among other things, PARNAS and Correia falsely claimed that the investors’ funds would be used solely for legitimate business expenses of Fraud Guarantee, when in fact the funds were largely withdrawn as cash, transferred to personal accounts, and used for various apparently personal expenditures.  PARNAS and Correia also made materially false representations concerning, among other things, how much money PARNAS had contributed to the company and how much money the company had raised overall.  At least seven victims invested in Fraud Guarantee based at least in part on PARNAS’s and Correia’s false and misleading representations, with each victim being fraudulently induced to pay hundreds of thousands of dollars, for a total of more than $2 million.

*                *                *

PARNAS, 50, of Boca Raton, Florida, was sentenced to 20 months in prison, three years of supervised release, as well as $2,322,500 restitution.  Igor Fruman was sentenced to 366 days in prison on January 21, 2022 for solicitation of a contribution by a foreign national.  Andrey Kukushkin was sentenced to 366 days in prison on March 15, 2022 for conspiring to make and aiding and abetting the making of a contribution by a foreign national.  David Correia was sentenced to 366 days in prison on February 8, 2021 for making false statements and conspiracy to commit wire fraud.  Andrey Muraviev is believed to be in Russia and remains at large. 

Mr. Williams praised the outstanding investigative work of the FBI and its New York Field Office.

This case is being handled by the Office’s Public Corruption Unit.  Assistant U.S. Attorneys Rebekah Donaleski, Aline R. Flodr, Hagan Scotten, and Nicolas Roos are in charge of the prosecution.                                           

Source: United States Department of Justice News

CHARLOTTE, N.C. – Yesenia Rodriguez, 25, of Charlotte, appeared before U.S. Magistrate Judge David S. Cayer today and pleaded guilty to conspiring to commit wire fraud for fraudulently obtaining over $100,000 in COVID-19 relief funds, announced Dena J. King, U.S. Attorney for the Western District of North Carolina.

Robert R. Wells, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, joins U.S. Attorney King in making today’s announcement.

According to filed court documents and today’s plea hearing, Rodriguez engaged in a conspiracy to defraud the U.S. Small Business Administration (SBA) by, among other things, obtaining an Economic Injury Disaster Loan (EIDL) based on false information. As Rodriguez admitted in court today, from April 2020 through May 2021, the defendant conspired with another individual, identified in court documents as G.R., to obtain COVID-19 relief funds, including two loans under the EIDL program and federally subsidized unemployment benefits totaling over $100,000.

Plea documents show that in July 2020, Rodriguez electronically submitted a fraudulent EIDL application for a purported hair and nail salon named Yesenia Rodriguez. Rodriguez, who had recently left her job at a national bank, submitted the application for the purported salon, when in fact Rodriguez did not own a salon and, instead, was collecting unemployment. As a result of the fraudulent EIDL application, Rodriguez received $37,500 in relief funding via electronic financial transactions. Rodriguez’s co-conspirator, G.R., also fraudulently obtained EIDL funding totaling $47,500 for a business identified as Company 1. Although Company 1 was a real operating business, G.R. electronically submitted a fraudulent application that contained false representations about its eligibility for EIDL funding, including the date Company 1 was founded. At the time the EIDL application was submitted for Company 1, G.R. was also fraudulently collecting federally subsidized unemployment benefits from the State of North Carolina. Rodriguez and G.R. fraudulently obtained at least $112,000 in disaster relief funds that were intended for existing businesses and individuals harmed by the COVID-19 pandemic.

Rodriguez was released on bond following today’s guilty plea. The conspiracy charge carries a maximum prison term of 5 years and a $250,000 fine. A sentencing date has not been set.

The CARES Act is a federal law enacted March 29, 2020, and it is designed to provide emergency financial assistance to millions of Americans suffering the economic effects caused by the COVID-19 pandemic. The CARES Act established several new temporary programs and provided for the expansion of others, including the EIDL program, which is an SBA program that provides low-interest financing to small businesses, renters, and homeowners in regions affected by declared disasters.

In making today’s announcement U.S. Attorney King commended the FBI for their investigation and thanked the North Carolina Department of Public Safety Special Operations and Intelligence Unit for their invaluable assistance.

Assistant U.S. Attorney Daniel Ryan of the U.S. Attorney’s Office in Charlotte is prosecuting the case.

The Department of Justice and the U.S. Attorney’s Office for the Western District of North Carolina remain vigilant in detecting, investigating, and prosecuting wrongdoing related to the COVID-19 pandemic. If you think you are a victim of coronavirus fraud or have information pertaining to fraud involving COVID-19, contact the National Center for Disaster Fraud Hotline at 866-720-5721 or submit a complaint online using the NCDF Web Complaint Form. Members of the public in the Western District of North Carolina are also encouraged to call 704-344-6222 to reach their local Coronavirus Fraud Coordinator.