Month: April 2023

Source: United States Department of Justice News

Adobe Inc. has agreed to pay $3 million to resolve False Claims Act allegations that it made payments in violation of the Anti-Kickback Act in return for influence over the sale of Adobe software to the federal government.

“Those who do business with the government are prohibited from paying kickbacks, which can result in unnecessary purchases and increase costs to taxpayers,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “We will continue to use all appropriate tools to safeguard the integrity of the federal procurement process.”

The settlement announced today resolves allegations that Adobe made improper payments under its Solution Partner program to companies that had a contractual or other relationship with the government that allowed them to influence federal purchases of Adobe software. Between January 2011 and December 2020, Adobe allegedly paid the companies a percentage of the purchase price of the software.  The United States contends that these payments constituted prohibited kickbacks that resulted in Adobe causing false claims for payment to be submitted to federal agencies.  

“A fair market relies heavily on an even playing field,” said U.S. Attorney Matthew M. Graves for the District of Columbia. “When a company, vendor, or business owner tips the scales to their advantage, it undermines the system. When government dollars are involved, it means taxpayers ultimately bear the burden. Whistleblowers – like those in this case – are to be commended for trying to return the playing field to level.”

“The General Service Administration Office of the Inspector General (GSA-OIG) will continue working to protect taxpayer dollars and the integrity of federal contracting,” said Inspector General Carol F. Ochoa of the GSA. “I appreciate the hard work of the special agents, auditors, and attorneys on this case.”

The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Alan Dowless, Barbara Evans, and Carrie Whalen, who are all former Adobe managers. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. As part of this resolution, Dowless, Evans, and Whalen will receive $555,000. The qui tam case is captioned United States ex rel. Dowless v. Adobe, Inc., Civil Action Number 17-cv-02039 (D.D.C.).

The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the District of Columbia, with assistance from the GSA-OIG and the Defense Criminal Investigative Service.

Senior Trial Attorney Greg Pearson of the Civil Division and Assistant U.S. Attorney Benton Peterson for the District of Columbia handled the matter. 

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

Source: United States Department of Justice News

Earlier today, following a bilateral meeting between the United States and Mexico at the White House, Attorney General Merrick B. Garland and Deputy Attorney General Lisa O. Monaco hosted a luncheon with U.S. and Mexican government officials focused on our partnership in fighting fentanyl and firearms trafficking. The Mexican delegation was led by Secretary for Security and Citizen Protection Rosa Icela Rodriguez, who was recently appointed as the chair of a presidential commission to combat illicit trafficking in synthetic drugs, firearms, and ammunition. Officials discussed law enforcement efforts in the fight against fentanyl trafficking and the illegal firearms smuggling that strengthens the cartels. They also noted the substantial progress that has been made on both issues through bilateral cooperation.

Both delegations pledged to increase information-sharing and cooperation on criminal investigations and prosecutions focusing on disrupting the entire fentanyl supply chain, beginning with interdiction of precursor shipments from China and other countries, through takedowns of illegal laboratories, to arrests of members of distribution networks, to targeting money laundering facilitators. 

Attorney General Garland expressed his deep appreciation for all the sacrifices the Mexican military and law enforcement have made – including facing violence and death to fight the cartels. Deputy Attorney General Monaco thanked the Government of Mexico for their recent high number of extraditions to the United States.

The Mexican delegation also included Secretary of Foreign Affairs Marcelo Ebrard Casaubon, Attorney General Alejandro Gertz Manero, Secretary of Defense General Luis Cresencio Sandoval González, Secretary of the Navy Admiral José Rafael Ojeda Durán, Secretary of Health Jorge Alcocer Varela, and Ambassador to the United States Esteban Moctezuma Barragán.

Attorney General Garland and Deputy Attorney General Monaco were joined by U.S. colleagues, including Homeland Security Advisor Dr. Elizabeth Sherwood-Randall, who is leading the interagency efforts against fentanyl; U.S. Ambassador to Mexico Ken Salazar; Deputy Secretary of Homeland Security John Tien; Director of ONDCP Dr. Rahul Gupta; and State Department Assistant Secretary for International Narcotics and Law Enforcement Affairs Todd Robinson.

Both delegations agreed to further bilateral working groups focusing on the disruption of precursor chemicals shipments and illicit firearms smuggling.

Source: United States Department of Justice News

Damian Williams, the United States Attorney for the Southern District of New York, announced that ADRIAN ALEXANDER, a New York litigation funder, was sentenced today to 36 months in prison for his participation in a scheme to obtain large insurance settlements and lawsuit recoveries from fraudulent trip-and-fall accidents.  ALEXANDER is the 11th defendant to plead guilty or be convicted at trial for his participation in this fraud scheme and the fifth defendant to be sentenced.  Defendants Ryan Rainford, Bryan Duncan and Robert Locust, who recruited patients into the scheme and were convicted at trial in May 2019, were previously sentenced on January 7, 2020, July 27, 2020, and July 9, 2021, respectively.  Defendant Sady Ribeiro, a surgeon who participated in the scheme, was previously sentenced on March 23, 2023.  U.S. District Judge Sidney H. Stein imposed all sentences. 

U.S. Attorney Damian Williams said: “Adrian Alexander knowingly exploited some of the most vulnerable members of society – many of whom were poor, drug addicts, or homeless – in order to enrich himself and his investors.  Today’s sentence should serve as a warning to unscrupulous litigation funders that, together with our law enforcement partners, we will hold accountable those who engage in unlawful practices and prey on litigants without the means to avail themselves of the judicial process.”

According to the Indictment, the Superseding Information, evidence presented in court, and statements made in court:

ALEXANDER, among others, was involved in an extensive fraud scheme through which fraud scheme participants defrauded businesses and insurance companies by staging trip-and-fall accidents and filing fraudulent lawsuits arising from those staged trip-and-fall accidents.

The fraud scheme participants recruited individuals (the “Patients”) to stage or falsely claim to have suffered trip-and-fall accidents at particular locations throughout the New York City area (the “Accident Sites”).  In the course of the fraud scheme, scheme participants recruited more than 400 Patients.  Members of the fraud scheme often recruited Patients who were extremely poor.  For example, it was common for Patients to ask for food when they would appear for their intake meetings with the lawyers.  Many of the Patients did not have sufficient clothing to keep them warm during the winter and had poor-quality shoes.  Members of the fraud scheme also recruited Patients who were drug addicts, and it was common for scheme participants to recruit Patients from homeless shelters in New York City.

In the beginning, scheme participants would instruct Patients to claim they had tripped and fallen at a particular location, when in fact, the Patients had suffered no such accidents.  Eventually, at the direction of the lawyers who filed fraudulent lawsuits on behalf of the Patients, scheme participants began to instruct Patients to stage trip-and-fall accidents, i.e., to go to a location and deliberately fall.  Common Accident Sites used during the fraud scheme included cellar doors, cracks in concrete sidewalks, and purported “potholes.”

After the staged trip-and-fall accidents, Patients were referred to specific attorneys who would file personal injury lawsuits (the “Fraudulent Lawsuits”) against the owners of the Accident Sites and/or insurance companies of the owners of the accident sites (the “Victims”).  The Fraudulent Lawsuits did not disclose that the Patients had deliberately fallen at the Accident Sites or, in some cases, had not fallen at all.  During the course of the fraud scheme, the defendants, together with others known and unknown, attempted to defraud the Victims of more than $31,000,000.

The Patients were also instructed to receive ongoing chiropractic and medical treatment from certain chiropractors and doctors, including Ribeiro.  The fraud scheme participants advised the Patients that if they intended to continue with their lawsuits, they were required to undergo surgery, which was critical to boosting the value of any potential settlement.  Fraud scheme participants, including ALEXANDER, looked for doctors who were willing to perform surgeries, even when others would not.  For example, in a May 2015 email, after one doctor informed ALEXANDER that a particular patient was “not . . . a surgical candidate,” ALEXANDER directed a Patient recruiter and case manager to “[t]ake him to [another doctor]—Nothing is done until its done.” 

As an incentive to getting surgery, the recruited Patients were offered a payment, in the form of loans, typically between $1,000 and $1,500 after they completed surgery (“Post-Surgery Loans”).  Patients generally were told to undergo two surgeries. 

The Patients’ legal and medical fees were usually paid for by litigation funding companies (the “Funding Companies”), including a funding company owned by ALEXANDER, even if the Patient maintained medical coverage through an insurance company or a government-subsidized program.  The Funding Companies also paid the fraud scheme organizers and participants referral fees, typically $1,000 to $2,500, for each Patient who signed a funding agreement.  In an April 2015 email about a particular Patient’s staged accident, Alexander wrote to two of the recruiters and case managers, “I am sure you realize I want to do these deals; I am just trying to see how we can, without getting in trouble.”

In exchange for funding Patients’ medical and legal costs, the Funding Companies charged the Patients high interest rates, sometimes up to 50% on medical loans and up to 100% on personal loans.  The interest rates were so high that oftentimes the majority of the proceeds that were awarded in the Fraudulent Lawsuits were paid to the Funding Companies, lawyers, doctors, and others, with the Patients receiving a much smaller percentage of the remaining recovery. 

In addition to the high-interest rates charged by the Funding Companies, ALEXANDER also profited from the Fraud Scheme through an MRI facility that he owned and operated (“MRI Facility-1”).  ALEXANDER pushed the case managers to send Patients to MRI Facility-1, which routinely prepared MRI reports that were “positive” for medical conditions justifying surgery, even though the Patients had not sustained any injuries.  ALEXANDER received $1,000 per MRI that MRI Facility-1 prepared as part of the scheme. 

*                *                *

In addition to the prison term, ALEXANDER, 76, of New York, New York, was sentenced to three years of supervised release.  ALEXANDER was further ordered to pay $659,011 in forfeiture.  Restitution will be determined by the Court within 90 days. 

Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation.  Mr. Williams also thanked the National Insurance Crime Bureau for their assistance in the investigation.

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit.  Assistant U.S. Attorneys Nicholas Chiuchiolo, Nicholas Folly, Danielle Kudla, and Alexandra Rothman are in charge of the prosecution.

Source: United States Department of Justice News

GREENEVILLE, Tenn. – On April 13, 2023, Bobby Rowe Maggard, Jr., 47, of Bristol, Tennessee, was sentenced to 46 months in prison by the Honorable Clifton L. Corker, in the United States District Court for the Eastern District of Tennessee at Greeneville.  

On January 11, 2023, Maggard pled guilty to one count of possession of a firearm by a felon, in violation of 18 U.S.C. §922(g)(3), and one count of impersonating a Deputy U.S. Marshal, in violation of 18 U.S.C. § 912.  Upon his release from imprisonment, Maggard will be on supervised release for 3 years.

According to an Agreed Factual Basis filed with the Court on January 11, 2023, in August 2000, Maggard was convicted of the felony offense of Grand Larceny in Tazwell County, Virginia.  In 2021, he became employed as a registered bonding agent for a bonding company in east Tennessee.  In July 2021, law enforcement began receiving information that a person was representing himself as a Deputy U.S. Marshal, with one incident arising in Sullivan County, Tennessee.  Maggard was identified as a suspect.  When questioned by law enforcement, Maggard admitted that he was a felon and that he knew it was unlawful for him to possess a firearm.  He also admitted that he used a fake Deputy U.S. Marshal’s badge and patch, which he had purchased on the internet, to pose as a Deputy U.S. Marshal when he was securing information from people.  He stated that he impersonated a Deputy U.S. Marshal to people in order to “scare them in to telling the truth.”  He also admitted to falsely using the identity of a Deputy U.S. Marshal to obtain repair services for an Apple watch.  At the time of his questioning, Maggard was on supervised probation in Sullivan County, Tennessee, for Failure to Appear.  Law enforcement conducted a search of his residence and recovered eight (8) firearms – three (3) Glock pistols, four (4) AR-style rifles in various calibers, and a 12-gauge tactical shotgun.

This case was the result of an investigation by the Sullivan County Sheriff’s Office, the United States Marshals Service, and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).

“The impersonation of a Deputy U.S. Marshal, while armed and after having been convicted of a felony offense, placed the public in danger,” said U.S. Attorney Francis M. Hamilton III.  “Our office will vigorously investigate and prosecute those who engage in this conduct.”

“The United States Marshals Service very much appreciates the great work of the U.S. Attorney’s Office, ATF and ATF Task Force Officer Farmer of the Sullivan County Sheriff’s Department for their excellent work on this investigation,” said United States Marshal David Jolley.

“We are pleased with the outcome of this case and the work of our detectives and federal partners.  Taking dangerous armed felons off our streets is imperative for the public’s safety,” said Sheriff Jeffrey Cassidy, of the Sullivan County Sheriff’s Office.

Assistant U.S. Attorney B. Todd Martin represented the United States.

This case also was part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone.  On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.

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Source: United States Department of Justice News

Defendant Faces Ten Year Mandatory Minimum Sentence

            WASHINGTON – Daniel Jahleel Thomas, also known as “dandue,” 22, of Washington, D.C., pleaded guilty today, in the U.S. District Court for the District of Columbia, to conspiring to distribute marijuana and oxycodone, illegal possession of a machinegun, and carrying a handgun during or in relation to drug trafficking, announced U.S. Attorney Matthew M. Graves, Special Agent in Charge Wayne A. Jacobs, of the FBI Washington Field Office Criminal and Cyber Division, and Chief Robert J. Contee, III, of the Metropolitan Police Department (MPD).

            U.S. District Court Judge Beryl A. Howell scheduled sentencing for August 4, 2023. The crimes to which Thomas pleaded guilty carry a combined mandatory-minimum of ten years in prison and a maximum penalty of life in prison.

            According to court documents, Thomas advertised on Instagram that he had marijuana for sale. On February 25, 2022, MPD officers learned of the advertisement and responded to the location – outside the Fort Chaplin Park Apartments – knowing that Thomas had a court-ordered stay-away from the complex as a condition of a prior gun arrest. The officers saw Thomas standing outside the apartments and approached him. When Thomas saw the officers, he jumped into the back seat of a vehicle operated by a ride share service. As the officers attempted to speak with Thomas about the stay-away order, he resisted and pulled away. During the subsequent struggle, officers discovered a firearm in Thomas’ waistband. The firearm was later determined to be a Glock, Model 19, 9mm handgun loaded with one round in the chamber and 14 rounds in the magazine. The handgun was also fitted with a “giggle switch,” which made the handgun capable of fully automatic fire. 

            Thomas was arrested that afternoon outside the Fort Chaplin Park Apartments in the 4200 block of Blaine Street, Northeast. During a search of the duffel bag he was carrying, officers found four large bags of marijuana, each containing approximately one-pound, as well as 81 pills, each of which contained 30mg of oxycodone.  

            At the time of his arrest, Thomas was under investigation by the FBI for his role in a variety of federal offenses related to firearms and narcotic trafficking. Coordination between the FBI and MPD led to an indictment charging Thomas and two of his co-conspirators with numerous federal offenses. 

            In announcing the plea, U.S. Attorney Graves, Special Agent in Charge Jacobs, and Chief Contee commended the work of those who investigated the case, including FBI and MPD. Finally, they cited the efforts of those who worked on the case from the U.S. Attorney’s Office for the District of Columbia, including Assistant U.S. Attorneys James B. Nelson and Meredith Mayer-Dempsey and Paralegal Specialist Genevieve de Guzman.