Month: February 2023

Source: United States Department of Justice News

Damian Williams, the United States Attorney for the Southern District of New York, announced today that MARIANNA LEVIN was sentenced to 54 months in prison for her leadership role in a broad fraud scheme that defrauded Medicaid for home health and personal care services that were not actually rendered, resulting in the loss of more than $100 million.  United States District Judge John P. Cronan imposed the sentence.  LEVIN pled guilty to wire fraud on June 1, 2022.

U.S. Attorney Damian Williams said: “For years, Marianna Levin, the owner of a Brooklyn-based home health agency, defrauded taxpayers through a massive, fraudulent home health scheme.  As part of the scheme, Levin billed tens of millions of dollars to Medicaid for home health services that were not actually rendered.  As a result, the scheme diverted much-needed resources meant to support services for vulnerable individuals.  Today’s sentence sends a message that those who engage in health care fraud schemes will face stiff penalties.”

According to statements and filings in federal court:

Since in or about 2015, LEVIN engaged in a widespread fraud scheme through which she and her co-conspirators defrauded Medicaid for home health and personal care services that were not actually rendered.  During the course of the scheme, LEVIN served in a senior, executive role at a licensed home care service agency based in Brooklyn, New York (“Agency-1”).  In or about 2016, LEVIN and her co-conspirators opened a second licensed home care service agency based in Brooklyn (“Agency-2” and, together with Agency-1, the “Agencies”).  LEVIN served as the owner of Agency-2 and also continued in her leadership role at Agency-1.

The Agencies purported to provide home health and personal care services to patients residing in all five boroughs of New York City and Nassau County.  Combined, the Agencies employed approximately 3,000 home health and personal care aides (the “Aides”).  Most of the Aides were licensed to provide home health aide services and personal care services.

Home care is a health service provided in the patient’s home to promote, maintain, or restore health or to lessen the effects of illness and disability.  Home care includes personal care services, administered by Aides, including housekeeping, meal preparation, bathing, toileting, and grooming.

From in or about 2015 to in or about December 2020, Medicaid reimbursed the Agencies hundreds of millions of dollars for home health and personal care services.  A significant portion of the Agencies’ billings were fraudulent.  In particular, the Agencies billed Medicaid for “no-show” cases in which Aides claimed to be performing home health or personal care services when they were not.  At times when Aides falsely claimed to be performing home health or personal care services, they, in fact, stayed home, ran personal errands, vacationed, and socialized with family and friends.  The fraud at the Agencies coincided with ballooning costs on home care in New York State.  In or about January 2020, New York’s State budget director announced, in substance and in part, that spending in the home health space tripled between the 2013 and 2019 fiscal years, representing a $4.8 billion increase. 

With no-show cases at the Agencies, an Aide’s fraudulently obtained wages were often split between the no-show Aide and the no-show patient.  In addition to paying kickbacks to no-show patients, no-show Aides sometimes paid kickbacks to conspirators who referred no-show cases to Aides at the Agencies. 

LEVIN and her co-conspirators also engaged in other fraudulent activity to boost the Agencies’ billing and increase the amount of money paid out to the Agencies. 

Over the course of the scheme, LEVIN received more than $5 million in compensation from the Agencies.

In imposing the sentence, Judge Cronan emphasized the seriousness of LEVIN’s involvement in the fraud, the losses it caused, and the need to deter other home care businesses and workers from engaging in similar crimes.

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In addition to her prison term, MARIANNA LEVIN, 49, of Brooklyn, New York, was ordered to forfeit $1,496,000 and pay restitution of $36,328,183. 

Mr. Williams praised the investigative work of the Federal Bureau of Investigation. 

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorneys Nicholas W. Chiuchiolo and Daniel G. Nessim are in charge of the prosecution.

Source: United States Department of Justice News

BLUEFIELD, W.Va. – Terry Headen, 48, of Welch, was sentenced today to five years in prison, to be followed by five years of supervised release, for possession of a firearm in furtherance of a drug trafficking crime.

According to court documents and statements made in court, on November 10, 2021, Headen sold an amount of a controlled substance represented to be heroin to a confidential informant in Havaco. Headen admitted that he possessed an AR-15 style semiautomatic rifle during the drug transaction.

United States Attorney Will Thompson made the announcement and commended the investigative work of the Southern Regional Drug and Violent Crime Unit.

Senior United States District Judge David A. Faber imposed the sentence. Assistant United States Attorney Andrew D. Isabell prosecuted the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 1:22-cr-177.

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Source: United States Department of Justice News

Three California companies have agreed to pay a total of $530,000 to settle allegations that they knowingly violated the False Claims Act when they received and retained more than one Paycheck Protection Program (PPP) loan prior to Dec. 31, 2020, in violation of PPP rules.  

La Baguette, LLC, which operates a bakery in Palo Alto, has agreed to pay $430,000 to settle allegations that it received and retained a duplicate PPP loan in 2020 and then later improperly sought and received forgiveness for the duplicate loan. 

Dynamic Integrated Solutions, Inc., an industrial equipment supplier located in Santa Clara, has agreed to pay $50,000 in civil penalties to settle allegations that it received and retained a duplicate loan. The company agreed to repay the loan in full to its lender, relieving the U.S. Small Business Administration (SBA) of liability to the lender for the federal guaranty of approximately $985,000 on the duplicate loan.   

Priority Acquisitions, Inc., a licensed general contractor located in Castro Valley, has agreed to pay $50,000 in civil damages and penalties to settle allegations that it received and retained a duplicate loan. The company agreed to repay the loan in full to its lender, relieving the SBA of liability for the federal guaranty of approximately $200,625.   

Congress created the PPP in March 2020, as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, to provide emergency financial support to the millions of Americans suffering the economic effects caused by the COVID-19 pandemic. The CARES Act authorized billions of dollars in forgivable loans to small businesses struggling to pay employees and other business expenses. Throughout 2020, PPP loan applicants were required to certify that they would not receive more than one PPP loan prior to Dec. 31, 2020.

“PPP loans were intended to provide critical relief to small businesses,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department is committed to pursuing those who knowingly violated the requirements of the PPP or other COVID-19 assistance programs and obtained relief funds to which they were not entitled.”

“PPP loans were intended to help qualified businesses retain their employees and pay other bills during the pandemic,” said U.S. Attorney Stephanie M. Hinds for the Northern District of California. “This Office will continue to pursue any business that misused the program by obtaining PPP loans for which they were not eligible, as the three settlements announced today reflect.”

“Those who violate the False Claim Act by fraudulently receiving and retaining SBA pandemic program funds will be held accountable,” said Special Agent in Charge Weston King of SBA OIG’s Western Region. “This settlement demonstrates that wrongfully obtaining taxpayer dollars will not go unnoticed, and violators will be identified. I want to thank the U.S. Attorney’s Office and our law enforcement partners for their support and dedication to pursuing justice in this case.”

The settlements resolve claims brought under the qui tam or whistleblower provisions of the False Claims Act by J. Bryan Quesenberry. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned U.S. ex rel. Quesenberry v. Bay Wire, Inc., et al., No. 2:20-cv-712 (N.D. Cal.). Quesenberry will receive a total of approximately $80,000 in connection with the three settlements.  

The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Northern District of California, with assistance from the SBA’s Office of General Counsel and Office of the Inspector General.

This matter was handled by Trial Attorney Jared S. Wiesner of the Civil Division and Assistant U.S. Attorney Michael T. Pyle for the Northern District of California.

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.

Tips and complaints from all sources about potential fraud affecting COVID-19 government relief programs can be reported by visiting the webpage of the Civil Division’s Fraud Section, which can be found here. Anyone with information about allegations of attempted fraud involving COVID-19 can also 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 claims resolved by the settlement are allegations only, and there has been no determination of liability.

Source: United States Department of Justice News

NEWPORT NEWS, Va. – A Newport News man pleaded guilty today to evading his federal income taxes.

According to court documents, Eric Bautista, 37, from approximately January 2017 through December 2020, Bautista worked and earned income as an independent contractor for various commercial fishing companies in the Hampton Roads region and elsewhere. He was paid over $500,000 for his work during this time. Bautista failed to file U.S. Individual income tax returns for tax years 2012 through 2020.  He was levied by the Internal Revenue Service (IRS), but took steps to evade his income taxes, including working under a stolen identity and dealing heavily in cash.  For the years 2012 through 2020, Bautista owed a tax debt of over $170,000.

Bautista pleaded guilty to evasion of income taxed and is scheduled to be sentenced on June 24. He faces a maximum penalty of five years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, and Darrell J. Waldon, IRS Criminal Investigation Special Agent in Charge of the Washington D.C. Field Office, made the announcement after U.S. Magistrate Judge Douglas E. Miller accepted the plea.

Assistant U.S. Attorney Brian J. Samuels is prosecuting the case.

A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:21-cr-85.

Source: United States Department of Justice News

CONTACT: Barbara Burns            
PHONE:       (716) 843-5817    
FAX #:          (716) 551-3051        

BUFFALO, N.Y.-U.S. Attorney Trini E. Ross announced today that Jacob V. Schmidbauer, 41, of Lancaster, NY, was arrested and charged by criminal complaint with production and possession of child pornography. The charges carry a mandatory minimum penalty of 15 years in prison, a maximum of 30 years and a $250,000 fine.

Assistant U.S. Attorney Aaron J. Mango, who is handling the case, stated that according to the complaint, on January 8, 2023, the Lancaster Police Department received information that Schmidbauer allegedly recorded a sexually explicit video of a minor female victim. During the course of the investigation, law enforcement seized a total of 22 electronic devices that belong to Schmidbauer as well as an SD card. A review of the SD card recovered 32 video clips, which included the sexually explicit video of the minor female victim. 
 
Schmidbauer made an initial appearance before U.S. Magistrate Judge Michael J. Roemer and is being held.

The criminal complaint is the result of an investigation by the Lancaster Police Department, under the direction of William Karn, Jr., and Homeland Security Investigations, under the direction of Special Agent-in-Charge Matthew Scarpino.   

The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.   
 

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