Month: January 2023

Source: United States Department of Justice News

FAYETTEVILLE — A Cave Springs man and former general manager at several Northwest Arkansas car dealerships pleaded guilty yesterday to evading more than $263,000 in federal income taxes.  U.S. District Judge Timothy L. Brooks presided over the plea hearing, in Jonathan M. Wichman, 35, waived indictment and pleaded guilty to a criminal information charging him with tax evasion.

According to court documents and statements made in court, Wichman worked from 2014 through 2020, mainly as a general manager at car dealerships in Northwest Arkansas. In October 2018, Wichman accessed his employer’s online payroll system and caused the dealership to not withhold any federal income taxes or employment taxes from his 2019 and 2020 wages. During these years, Wichman earned a total of $856,882 in wages, including $360,739 from the dealership where he altered his federal tax withholdings.

Wichman did not file his tax returns with the IRS for tax years 2019 and 2020. Also, he did not timely file his tax returns for tax years 2014 through 2018 despite receiving correspondence from the IRS asking why he had not filed his tax returns. In May 2018, the IRS filed substitutes for returns for Wichman for tax years 2014 and 2016 and assessed additional taxes, which he also did not pay.

Wichman told investigating agents that he knew he owed past due taxes to the IRS. Wichman said he prepared his taxes using commercial software, and each year, the program showed he owed a large amount of taxes. Wichman claimed he did not have the money to pay his taxes, so he did not file his tax returns.  However, the investigation revealed that Wichman did have money available to pay his taxes. From 2018 through 2021, Wichman made cash transactions at various casinos and banks totaling more than $1,079,000. In addition, from 2014 through 2022, Wichman spent more than $513,000 on luxury vehicles, a travel trailer, and a Florida vacation.

In total, Wichman did not pay $263,615 in income taxes to the IRS, and also admitted that he failed to pay income taxes to the state of Arkansas. Wichman agreed to pay restitution, including penalties and interest, to both the U.S. Treasury and Arkansas Department of Finance and Administration.

Wichman is scheduled to be sentenced at a later date and faces a maximum penalty of five years in prison. He also faces a period of supervised release, monetary penalties, and restitution. The U.S. District Judge will determine his sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

U.S. Attorney David Clay Fowlkes of the Western District of Arkansas made the announcement.

The Internal Revenue Service-Criminal Investigation is investigating the case.

Assistant U.S. Attorney Steven Mohlhenrich is prosecuting the case for the United States.

Source: United States Department of Justice Criminal Division

The Justice Department joins survivors, victim services providers, justice professionals and others in recognizing the month of January as National Stalking Awareness Month (NSAM). According to the CDC, an estimated one in three women and one in six men experience stalking in their lifetimes. This NSAM, the department reaffirms its commitment to survivors by honoring and providing resources to those leading efforts in supporting survivors and preventing stalking crimes.

Today the Office on Violence Against Women (OVW), which provides grants to communities, and the Stalking Prevention Awareness and Resource Center (SPARC), held a virtual Strategies Showcase highlighting OVW grantees’ promising approaches to stalking investigations, services for survivors and training for law enforcement and prosecutors.

“The Justice Department is committed to using all its tools to address stalking,” said Associate Attorney General Vanita Gupta. “Survivors need justice and safety, and communities require resources to respond and prevent this crime. OVW’s grantees play a critical role, providing essential services and justice solutions in their communities.”

With the prolific misuse of the internet and other forms of technology as weapons against stalking victims, today’s Strategies Showcase further emphasizes the White House’s priority to eradicate technology-facilitated violence. Last June, President Biden established the White House Task Force to Address Online Harassment and Abuse, an interagency effort to increase prevention, response and protection measures for survivors.

OVW will release new grant solicitations in the coming months to further address stalking, domestic violence, sexual assault and dating violence. Funds will support states, communities, institutions of higher education, tribes and victim service providers. OVW encourages applicants to visit the website for anticipated release dates and prepare their grants early. Additional resources for applicants and how to apply for OVW funding can be found on OVW’s website.

“OVW’s grant programs fund innovative and successful strategies to end stalking and other forms of gender-based violence,” said OVW Acting Director Allison Randall. “By encouraging a coordinated community response, these grant programs forge meaningful partnerships of on-the-ground service providers, culturally specific organizations and everyone who works daily to keep survivors safe.”

Created in 1995, OVW provides leadership in developing the nation’s capacity to reduce violence through the implementation of VAWA and subsequent legislation. OVW administers financial and technical assistance to communities across the country that are developing programs, policies, and practices aimed at ending domestic violence, dating violence, sexual assault and stalking. In addition to overseeing federal grant programs, OVW undertakes initiatives in response to special needs identified by communities facing acute challenges. Learn more at www.justice.gov/ovw.

The OVW-funded Stalking Prevention, Awareness & Resource Center (SPARC) offers training to service providers and justice professionals on keeping stalking survivors safe and holding offenders accountable. 

Source: United States Department of Justice Criminal Division

Medical device manufacturer DePuy Synthes, Inc. (DePuy), a subsidiary of Johnson & Johnson, has agreed to pay $9.75 million to resolve allegations it violated the False Claims Act by paying kickbacks to an orthopedic surgeon based in Massachusetts to induce his use of DePuy products.

The settlement announced today resolves allegations that DePuy violated the Anti-Kickback Statute (AKS) and caused the submission of false or fraudulent claims to Medicare by paying the orthopedic surgeon kickbacks in the form of free spinal implants and tools for use in surgeries that the surgeon performed overseas to induce that surgeon to use DePuy products in surgeries performed in the United States. As part of the settlement, DePuy has admitted that from at least July 2013 through February 2018, DePuy, acting through certain former sales representatives, gave the Massachusetts surgeon thousands of dollars’ worth of free DePuy implants and instruments, including cages, rods, screws, plates, and surgical instrumentation, that the surgeon used to perform surgeries overseas for patients who were not federal health care beneficiaries. Of the $9.75 million to be paid by DePuy, approximately $7.23 million will be returned to the federal government, and approximately $2.52 million will be returned to Massachusetts, which jointly funded claims for surgeries involving DePuy devices that were submitted to the Massachusetts Medicaid program.

The AKS prohibits offering, paying, soliciting, or receiving remuneration to induce referrals of items or services covered by Medicare and other federally funded programs. The statute is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives and are instead based on the best interests of their patients.

“Medical device manufacturers are prohibited from providing free items to induce a physician to use their devices,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “When medical devices are used in surgical procedures, patients deserve to know that their device was chosen based on quality of care considerations and not on improper inducements from manufacturers.”

“Today the United States resolves allegations that DePuy provided over $100,000 worth of free product to a surgeon in order to secure and reward that physician’s continued business,” said U.S. Attorney Rachael S. Rollins for the District of Massachusetts. “Unlawful kickbacks can severely distort medical judgment as well as the market for medical devices. The millions of patients that depend on our health care system deserve untainted medical decisions. This settlement reflects our commitment to stamping out illegal kickbacks.”

“The American people, as both taxpayers and consumers, expect medical device manufacturers like DePuy to abide by relevant laws and regulations. When such health care companies provide illegal kickbacks in order to boost profits, their actions erode public confidence in the health care system, can compromise the patient-physician relationship, and waste government health program funding,” said Special Agent in Charge Phillip M. Coyne of the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG). “In close cooperation with our law enforcement partners, we will continue to thoroughly investigate allegations of fraud to protect both federal health care programs and those served by them.”

“Today’s settlement makes it crystal clear that it is illegal for medical device companies to provide physicians with free medical products to win business and boost their bottom line through illegal kickback schemes,” said Special Agent in Charge Joseph R. Bonavolonta of the FBI Boston Division. “Every year, health care fraud costs taxpayers billions of dollars. It is not a victimless crime and this unscrupulous scheme orchestrated by DePuy is just one example of how the FBI and our partners are working hard every day to protect both patients and taxpayers.”

The lawsuit was originally filed under the qui tam or whistleblower provisions of the False Claims Act by Aleksej Gusakovs, who is a former sales representative for DePuy. Under those provisions, private parties, known as relators, can file an action on behalf of the United States and receive a portion of the recovery. The qui tam case is captioned United States et al. ex rel. John Doe v. Johnson & Johnson, et al., No. 17-cv-11502 (D. Mass.). As part of today’s resolution, Gusakovs will receive approximately $1.37 million.

The settlement was a result of a coordinated effort between the Civil Division’s Commercial Litigation Branch (Fraud Section) and the U.S. Attorney’s Office for the District of Massachusetts. The HHS-OIG provided investigative support.

The government’s pursuit of these matters illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800‑HHS‑TIPS (800-447-8477).

The matter was handled by Senior Trial Counsel Benjamin C. Wei of the Civil Division and Assistant U.S. Attorneys Jessica Weber and Andrew Caffrey for the District of Massachusetts.

The claims resolved by the settlement are allegations only, and there has been no determination of liability.

Source: United States Department of Justice Criminal Division

North Korean Businessman Accessed the U.S. Financial System and Deceived U.S. Banks to Circumvent Sanctions Against North Korea

Source: United States Department of Justice News

NEWARK, N.J. – Three members of a Jersey City street gang were charged today for their roles in a cocaine distribution organization, as well as for firearms violations, U.S. Attorney Philip Sellinger announced.

Rodney Broadway, aka “Banks,” 31; Parish George, aka “P Money,” 31; and Dejahn Ingram, aka “Fresh,” 32, all of Jersey City, New Jersey, are each charged by complaint with one count of conspiracy to distribute 500 grams or more of cocaine. George and Ingram are charged with unlawful possession of firearms as convicted felons, and Broadway is charged with unlawful possession of ammunition as a convicted felon. Broadway and George are also charged with possession with intent to distribute cocaine. All three defendants appeared today before U.S. Magistrate Judge André M. Espinosa in Newark federal court and were detained.

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

The three defendants are associated with a neighborhood street gang that operates in and around the Salem Lafayette Apartments in Jersey City. At the time of their arrests on Jan.19, 2023, George and Ingram each possessed a loaded firearm. Search warrants executed at multiple residences associated with Broadway, George, and Ingram revealed a significant quantity of cocaine, hundreds of rounds of ammunition, and other paraphernalia.

The defendants each face a mandatory minimum term of five years in prison and a maximum term of 40 years in prison.

U.S. Attorney Sellinger credited special agents of HSI Newark, under the leadership of Special Agent in Charge Ricky J. Patel, and investigators the Jersey City Police Department, under the direction of Director James Shea, with the investigation leading to the charges. He also thanked the Hudson County Prosecutor’s Office, under the direction of Prosecutor Esther Suarez, special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives under the direction of Acting Special Agent in Charge Bryan Miller, special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy, for their assistance.

This investigation was conducted as part of the Jersey City Violent Crime Initiative (VCI). The VCI was formed in 2018 by the U.S. Attorney’s Office for the District of New Jersey, the Hudson County Prosecutor’s Office, and the Jersey City Police Department, for the sole purpose of combatting violent crime in and around Jersey City. As part of this partnership, federal, state, county, and city agencies collaborate to strategize and prioritize the prosecution of violent offenders who endanger the safety of the community. The VCI is composed of the U.S. Attorney’s Office, the FBI, the ATF, the Drug Enforcement Administration’s (DEA) New Jersey Division, the U.S. Marshals, the Jersey City Police Department, the Hudson County Prosecutor’s Office, the Hudson County Sheriff’s Office, New Jersey State Parole, the Hudson County Jail, and the New Jersey State Police Regional Operations and Intelligence Center/Real Time Crime Center.

The government is represented by Assistant U.S. Attorney Dong Joo Lee of the Office’s OCDETF/Narcotics Unit.

The charges and allegations contained in the complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.