Author: MIL-OSI Publisher

Source: United States Department of Justice Criminal Division

GS Foods Group Inc. (GS Foods), headquartered in Ontario, California, has agreed to pay $949,696.90 to resolve False Claims Act liability in connection with bidding on contracts reserved for small businesses when GS Foods did not qualify as a small business. The contracts involved supplying food to facilities operated by the Federal Bureau of Prisons and U.S. Immigrations and Customs Enforcement. In connection with the settlement, the United States acknowledged that GS Foods took significant steps entitling it to credit for cooperating with the government. 

“Businesses that participate in federal small business contracting programs must ensure that they comply with applicable rules and regulations relating to eligibility,” said Acting  Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division. “When businesses run afoul of small business contracting requirements, they can mitigate the consequences by making timely self-disclosures, cooperating with investigations, and taking appropriate remedial measures.”

The settlement resolves allegations that, between Oct. 1, 2018 and March 8, 2024, GS Foods did not qualify as a small business because of its affiliation with certain other companies. The United States alleged that subsidiaries of GS Foods, GoodSource Solutions Inc., and Dori Foods Inc., bid on contracts and orders that had been expressly reserved, or set-aside, exclusively for small businesses. As a result, GoodSource Solutions and Dori Foods allegedly obtained contracts for which they were not eligible. GS Foods timely self-reported the conduct to the Department of Justice, Office of Inspector General (DOJ-OIG), and cooperated with the Justice Department’s investigation, including, for example, by identifying key witnesses and documents and making employees available for interviews. The company also took remedial measures, including updating its code of conduct, establishing an Ethics and Compliance Management Committee, establishing the position of Chief Compliance Officer, and developing and implementing additional employee training.

“It is a disservice to small businesses when contracts that were expressly set aside to create opportunities for small businesses are awarded to ineligible organizations,” said Special Agent in Charge Andrew Hartwell of DOJ-OIG, Fraud Detection Office. “The Department of Justice Office of the Inspector General is committed to playing our part to maintain the integrity of small business contracts.”  

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 DOJ-OIG. Fraud Section Senior Trial Counsel Jonathan H. Gold 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

A federal jury in Newark convicted a New Jersey man on Jan. 27 for conspiring to traffic fentanyl-related substances and launder money.

According to court documents and evidence presented at trial, from approximately January 2014 through September 2020, William Panzera, 51, of North Haledon, and other members of a drug trafficking organization, agreed to import and distribute controlled substances and controlled substance analogues, including fentanyl analogues, methylenedioxymethamphetamine (MDMA), methylone, and ketamine. Co-conspirators ordered controlled substances and analogues from a source in China and paid those sources hundreds of thousands of dollars via wire transfer and cryptocurrency. The conspirators distributed the substances throughout New Jersey in bulk and in the form of counterfeit pharmaceutical pills that actually contained fentanyl analogues. Eight other defendants have pleaded guilty in the case.

The jury convicted Panzera of conspiracy to distribute and possess with intent to distribute 100 grams or more of furanyl fentanyl and 100 grams or more of 4 fluoroisobutyryl fentanyl and conspiracy to commit international promotional money laundering. Panzera faces a mandatory minimum penalty of 10 years in prison, a maximum penalty of life in prison, and a fine of up to $10 million for the drug trafficking conspiracy charge, and a maximum penalty of 20 years in prison and a fine of up to $500,000 for the money laundering conspiracy charge. He is scheduled to be sentenced on June 25. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Supervisory Official Antoinette T. Bacon of the Justice Department’s Criminal Division, Acting U.S. Attorney Vikas Khanna for the District of New Jersey, and Special Agent in Charge Spiros Karabinas of Homeland Security Investigations (HSI) Newark made the announcement.

HSI Newark is investigating the case. HSI Philadelphia, the FBI Newark Field Office, the U.S. Postal Inspection Service Newark Field Office, IRS Criminal Investigation, U.S. Customs and Border Protection, the Newark Police Department, and the Essex County Prosecutor’s Office provided valuable assistance.

Money Laundering and Forfeiture Unit Chief Stephen Sola of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) and Assistant U.S. Attorney Sammi Malek and Special Assistant U.S. Attorney Alexander Hasapidis-Sferra for the District of New Jersey are prosecuting the case. Financial Investigator Kathryn Montemorra of the MLARS Special Financial Investigations Unit supported the investigation.

This case is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at www.justice.gov/OCDETF.

Source: United States Department of Justice

A federal judge in Charlotte, North Carolina, sentenced a Jamaican citizen yesterday to prison for operating a Jamaica-based fraudulent lottery scheme.

Antony Linton Stewart, 40, pleaded guilty on Aug. 3, 2023, to one count of conspiracy to commit mail and wire fraud, in the Western District of North Carolina.  On Jan. 27, U.S. District Court Judge Robert J. Conrad sentenced Stewart to 84 months in prison. Stewart was also ordered to pay $1,104,041.74 in restitution.

According to court documents, and as part of his plea, Stewart acknowledged that from approximately 2010 through at least August 2016, he led a fraudulent lottery fraud scheme in which he and his co-conspirators targeted victims in the United States. Stewart admitted that he contacted elderly Americans by phone and falsely told them that they had won money and other prizes in a sweepstakes or lottery.  Stewart told victims that they needed to send money to pay fees and taxes on their winnings.  He repeatedly contacted victims for as long as they could be persuaded to send additional money. No lottery existed and no victim ever received any winnings.

“Overseas lottery schemes are unfortunately a common means by which foreign criminals seek to target U.S. citizens, particularly elder Americans,” said Acting Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division. “Such schemes are unacceptable, and the Department will hold accountable those who participate in them.”

“Stealing money from elderly individuals is a despicable crime,” said U.S. Attorney Dena J. King for the Western District of North Carolina. “Today’s sentence sends a clear message that fraudsters who target and exploit older adults for financial gain will be brought to justice.”

This prosecution is part of the Justice Department’s effort to work with federal and foreign law enforcement to combat fraudulent lottery schemes in Jamaica that prey on U.S. citizens.

The U.S. Postal Inspection Service investigated the case. The Justice Department’s Office of International Affairs worked with law enforcement partners in Jamaica to secure the arrest and extradition of Stewart. The U.S. Marshals Service also provided significant assistance.

Trial Attorney Ryan E. Norman of the Justice Department’s Consumer Protection Branch prosecuted the case, with the assistance of Assistant U.S. Attorney Daniel Ryan for the Western District of North Carolina.

If you or someone you know is age 60 or older and has been a victim of financial fraud, help is standing by at the National Elder Fraud Hotline: 1-833-FRAUD-11 (1-833-372-8311). This Justice Department hotline, managed by the Office for Victims of Crime, is staffed by experienced professionals who provide personalized support to callers by assessing the needs of the victim and identifying relevant next steps. Case managers will identify appropriate reporting agencies, provide information to callers to assist them in reporting, connect callers directly with appropriate agencies, and provide resources and referrals, on a case-by-case basis. Reporting is the first step. Reporting can help authorities identify those who commit fraud and reporting certain financial losses due to fraud as soon as possible can increase the likelihood of recovering losses. The hotline is staffed seven days a week from 6:00 a.m. to 11:00 p.m. eastern time. English, Spanish, and other languages are available.

For more information about the Consumer Protection Branch, visit its website at www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Western District of North Carolina, visit their website at www.justice.gov/usao-wdnc. Information about the Justice Department’s Elder Fraud Initiative is available at www.justice.gov/elderjustice.