Saturday, October 25, 2014
WHITE HOUSE LETTER ON CONTINUATION OF NATIONAL EMERGENCY REGARDING SUDAN
FROM: THE WHITE HOUSE
October 24, 2014
Letter - Continuation of the National Emergency with Respect to Sudan
Dear Mr. Speaker: (Dear Mr. President:)
Section 202(d) of the National Emergencies Act (50 U.S.C. 1622(d)), provides for the automatic termination of a national emergency unless, within 90 days prior to the anniversary date of its declaration, the President publishes in the Federal Register and transmits to the Congress a notice stating that the emergency is to continue in effect beyond the anniversary date. In accordance with this provision, I have sent to the Federal Register for publication the enclosed notice stating that the national emergency with respect to Sudan is to continue in effect beyond November 3, 2014.
The crisis constituted by the actions and policies of the Government of Sudan that led to the declaration of a national emergency in Executive Order 13067 of November 3, 1997, and the expansion of that emergency in Executive Order 13400 of April 26, 2006, and with respect to which additional steps were taken in Executive Order 13412 of October 13, 2006, has not been resolved. These actions and policies continue to pose an unusual and extraordinary threat to the national security and foreign policy of the United States. Therefore, I have determined that it is necessary to continue the national emergency declared in Executive Order 13067 with respect to Sudan.
Sincerely,
BARACK OBAMA
SEC SANCTIONS AUDITOR FOR VIOLATING LAWS, REGULATIONS REQUIRING ROTATING OFF AUDIT ENGAGEMENTS
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
The lead partner primarily responsible for the audit of a public company is prohibited from performing lead audit partner services for the same issuer for more than five consecutive fiscal years. The SEC finds that Eliot Berman attempted to circumvent this auditor rotation requirement. For the audit of a company that he conducted for the previous five years, Berman installed as lead audit partner an employee at his firm who was not a certified public accountant nor otherwise qualified to lead such an audit. Berman improperly continued to perform many of the lead audit partner functions for that audit.
Berman and his firm Berman & Company, located in Boca Raton, agreed to settle the SEC’s charges. Berman must pay a $15,000 penalty and is suspended for at least one year from practicing as an accountant on behalf of any publicly traded company or other entity regulated by the SEC.
The case is part of the SEC’s ongoing Operation Broken Gate designed to identify auditors who disregard their gatekeeper roles in violating professional standards and thereby increasing the risk of undetected fraud in financial statements that are not being properly audited.
“When investors receive an audited financial statement, they have a right to expect that the audit was performed by a qualified and independent auditor,” said Paul Levenson, Director of the SEC’s Boston Regional Office. “Berman attempted to subvert the independence rules by concocting a sham rotation and naming an unqualified employee of the firm to serve as token lead audit partner while he continued to pull the strings.”
The SEC’s order instituting a settled administrative proceeding finds that Berman and his firm engaged in improper professional conduct pursuant to Section 4C(a)(2) of the Securities Exchange Act of 1934 as well as Rule 102(e)(1)(ii) of the Commission’s Rules of Practice. The order finds that they violated Section 10A(j) of the Exchange Act and caused their client’s violations of Section 13(a) of the Exchange Act and Rule 13a-1. The order further finds that Berman & Company violated and Berman willfully aided and abetted Rule 2-02 of Regulation S-X. Without admitting or denying the SEC’s findings, Berman and his firm consented to the order, which censures Berman & Company for its misconduct.
The SEC’s investigation was conducted by Patrick Noone and Marc Jones, and the case was supervised by Kevin Currid. The SEC appreciates the assistance of the Public Company Accounting Oversight Board.
SECRETARY KERRY'S REMARKS WITH KOREA FOREIGN MINISTER BYUNG-SE
FROM: U.S. STATE DEPARTMENT
Remarks With Republic of Korea Foreign Minister Yun Byung-se After Their Meeting
Remarks
John Kerry
Secretary of State
Treaty Room
Washington, DC
October 24, 2014
SECRETARY KERRY: Well, good morning. I want to start by welcoming my friend and my colleague, Foreign Minister Yun Byung-se, back to Washington, who is here along with South Korean Defense Minister Han Min-koo. We had a very productive what we call 2+2 meeting this morning – it is the third such dialogue that we have conducted – during which Secretary Hagel and I restated the degree to which we are deeply committed to building on today’s discussions and reinforcing the very close partnership that we have with the Republic of Korea.
It is safe to say – and everybody reiterated this today – that the U.S.-Republic of Korea alliance is stronger than ever. And thanks to the agreement that Defense Minister Han and Secretary Hagel signed yesterday, it’s about to become even stronger. This new agreement is going to serve as a blueprint for how and when South Korea will assume wartime operational control of the combined forces. And the goal of the agreement is to ensure that as South Korea continues to build up its own defense capabilities, our combined forces will be ready and able to provide the best possible defenses for the Korean people.
Our shared security is at the heart of the U.S.-ROK alliance. But ultimately, I want to make it clear that our alliance is about much more than that. It is the linchpin of security, stability, and prosperity in Northeast Asia and increasingly beyond there. Today, for instance, we discussed a number of important issues where our partnership is not only valuable, but it’s really essential.
Obviously, at the top of the list is the subject of North Korea. Secretary Hagel and I reiterated that the United States remains committed to a peaceful denuclearization of the Korean Peninsula through authentic and credible negotiations. We remain open to dialogue with North Korea, but there is no value in talks just for the sake of talks. North Korea must demonstrate that it is serious about denuclearization, and we need to be certain that it is prepared to live up to its international obligations and abide by international norms of behavior. In the meantime, we will remain vigilant against the clear threat that North Korea poses.
We also spent time today discussing our shared efforts on a number of other issues. We all understand that infectious disease in Africa, extremism in the Middle East, and territorial aggression in Eastern Europe pose threats that extend far beyond those regions. And both South Korea and the United States believe that our alliance will not only deepen our – not only deepen as we continue to step up our efforts to address those threats, and we will do so because we share a sense of responsibility about international leadership and the importance of these challenges to the norms of international behavior.
We were very grateful to hear from both Foreign Minister Yun and from Defense Minister Han that South Korea intends to continue cooperating closely with us in regard to these international efforts, and in fact wants to step up its efforts in a number of regards.
For example, we are very pleased that South Korea has announced that it will send additional healthcare experts to assist the international response in West Africa on top of the experts and supplies that it has already sent. And last month, as part of the global response to ISIL, South Korea contributed another $4 million in humanitarian assistance to Iraq, bringing its total contributions today to more than 5.2 million.
The Republic of Korea has emerged as a key global player dedicated, as the United States is, to universal values like human rights, democracy, and the rule of law. And as we discussed today, I pointed out it was only a few years ago that the Republic of South Korea was a recipient of aid; but because of its own ingenuity and its own commitment to growth and development and stability and democracy, now the Republic of Korea is itself a donor country assuming increasing responsibilities willfully and effectively on a global basis. And we welcome that and we’re grateful for it.
I mentioned that our alliance has, in fact, never been stronger. But given the staggering range of challenges that we face today, neither has it been more important. And with the help of our new ambassador to South Korea, Mark Lippert, who I will have the privilege of swearing in later today, we look forward to continuing our work with our South Korean allies and with our friends for many years to come.
Minister Yun, I’m delighted to turn the floor to you.
FOREIGN MINISTER YUN: Thank you, Mr. Secretary. (Via interpreter) First, I’d like to thank Secretary Kerry and Secretary Hagel for hosting the 2+2 meeting in Washington today. This year, the 2+2 meetings have been held for the third time from 2010 to 2012, and this is the first one since the Park Geun-hye administration. In 2010, we had focused on our response to North Korean aggressions. Today, we were able to focus on our alliance beyond the Korean Peninsula, on global issues as well. This demonstrates that the Korea-U.S. alliance has gone beyond serving as a linchpin for peace and stability on – in Asia-Pacific region. It is now a global partnership.
Through two summit meetings since the Park Geun-hye administration, we have been able to establish the fact that our relationship is the best ever since 1953. It is the strongest alliance in the world as well. I believe that this is based on mutual trust as well as continuous development at an adaptation of our relationship. Today, we were able to discuss various issues ranging from our alliance management as well as North Korean nuclear issues and other global issues as well.
In today’s meeting, we were able to express elation about the progress we’ve made within the last one and a half years, and we were able to reach a successful agreement on the defense cost-sharing special session last year. And yesterday, we were able to reach agreements on conditions-based OPCON transfer as well. Currently, Korea-U.S. nuclear agreement is likely to come to a successful conclusion. If that happens, we will have had the most successful agreements on most of our major issues.
On the other hand, there are other areas on which we need to see cooperation – cyber security as well as space projects – and I think our efforts are moving beyond these forces and into the new horizon. Recently, North Korean nuclear missile threats as well as other challenges have reinforced the fact that the combined defense readiness between Korea and U.S. will be the most effective in deterring aggression from North Korea and promoting peace and stability on the Korean Peninsula. And the unpredictability and the fluidity of the situation in Korea help us agree that we need a comprehensive, multidimensional response.
And I believe that denuclearization, human rights in North Korea, as well as a conducive environment for unification is the holistic approach that we also need to focus on. And to that end, we have to create more creative ideas on how to bring this about. We need to be able to ensure a safe life to North Koreans and bring about real human rights compliance in the country. By doing that, we’ll be able to create an environment conducive to unification, and I believe denuclearization will act as the engine in bringing this about.
Historical, territorial, and maritime issues have threatened Northeast Asia’s security environment. Since the Cold War has ended, this has been the most tense situation in the Northeast Asian region. Based on the Korea-U.S. alliance, we’ll be able to create an environment that will be able to create real solutions to these issues. In particular, the rebalancing of the Asia-Pacific region is going to contribute to peace and stability in Northeast Asia.
Finally, our alliance has moved beyond just the Korean Peninsula. We are very happy to announce that our alliance is contributing to resolving global issues. We are happy to report that we are collaborating on stopping the spread of the Ebola virus as well as other global issues. We will be sending more aid toward that area and considering this more than a health issue, but a serious issue to security in the world.
On another front, we are fighting ISIL and foreign terrorist fighters, and to that end we agree to the UN resolution and look forward to a thorough implementation. And since the joint statement on the 60th anniversary of the alliance, through these meetings we were able to add substance and detail to the vision and roadmap of the Korea-U.S. relationship. And I hope that, based on mutual trust, we’ll be able to improve on the already good relationship between the two.
Minister Han and I look forward to be able to reciprocate the warm hospitality to Secretary Kerry and Secretary Hagel on their next visit to Korea. Thank you.
MODERATOR: From Abigail Williams with NBC News.
QUESTION: First, Foreign Minister Yun, is it true that North Korea has closed its border citing Ebola fears?
And to Secretary Kerry, if true, how will this and the recent release of American Jeffrey Fowle impact negotiations over the release of the other two detained Americans? What does this – and what does this signal about internal politics in North Korea given Kim Jong-un’s 40-day absence?
Also, are you in a position to confirm reports --
SECRETARY KERRY: I’m sorry.
QUESTION: Sorry, one more. Are you --
SECRETARY KERRY: I hate to do this to you, but can you repeat the first part of your question? Because it got swallowed up. I couldn’t hear it.
QUESTION: Sure.
FOREIGN MINISTER YUN: From the beginning, yes.
SECRETARY KERRY: Yeah. From the beginning.
QUESTION: Okay. If true that North Korea has closed its borders citing Ebola fears, how will this and the recent release of American Jeffrey Fowle impact negotiations over the release of the other two detained Americans, and what does this signal about internal politics given Kim Jong-un’s 40-day absence?
Also, are you in a position to confirm reports that IS militants have used chlorine gas on Iraqi troops, and how will this change U.S. strategy?
FOREIGN MINISTER YUN: (Via interpreter) In recent months, North Korea has shown very unique behaviors. On the one hand, it is using continuous aggression, but on the other hand, they’re looking for dialogue. In the past few weeks, North Korea has launched aggressions on the DMZ as well as on maritime fronts, and they have fired at some of the flyers that were sprinkled in balloons. Just one month ago during the Asian games, high-level officials, however, visited Korea, and they proposed a high-level talk. So what they speak and what they do seem to be inconsistent. But for the second high-level meetings that we proposed, if North Korea accepts and if we are able to have the talks, then I believe we can find a path to improvement of relationship for peace on the Korean Peninsula as well as an environment conducive to unification. We are making various efforts to try and provide that kind of an environment.
SECRETARY KERRY: I can’t tell you how their decision will or won’t affect anything with respect to the other Americans who are being held. They have made some statements about their expectations of what the United States should do with respect to that. We’ve made it clear that no apology or other statement is in the offing. They need to release these people because they’re being held inappropriately. And our hope is that they will recognize the goodwill that could be built and the gesture that it would offer to the world of their willingness to try to open up a different diplomatic track. So our hope is for the humanitarian reason alone that they will behave differently and see fit to release these people. We’re grateful that Jeff Fowle was released, back in Ohio now. We’re delighted with that. But we are still deeply concerned about the other two Americans who are being held.
With respect to the chlorine, you asked me am I in a position to confirm it, and the answer is no. I am not in a position to confirm it, but I can tell you that we take these allegations very, very seriously, in particular, the most recent allegations about the use of chlorine as a chemical weapon. Chlorine by itself is not on the chemical weapons list, therefore it was not among those things removed under the agreement we reached with the Russians and the Syrians’ regime.
But when mixed in certain ways and used in certain ways, it can become a chemical weapon that is prohibited under the chemical weapons agreement. And therefore these allegations are extremely serious and we are seeking additional information in order to be able to determine whether or not we can confirm it. The use of any chemical weapon is an abhorrent act. It’s against international law, and these recent allegations underscore the importance of the work that we are currently engaged in. It will not change our strategy. It obviously can affect tactical decisions within that strategy, but our fundamental strategy remains absolutely clear and we are step by step bringing the coalition further and further down the road to being able to shore up the Iraqi army itself and to take measures against ISIL.
We’ve said in the beginning this will take time. And it will evolve, as it is, day by day as General Allen and our teams are working to come together; important meetings have been held during the course of this past week; and I expect to see further progress over the course of the next weeks.
MS. PSAKI: The final question will be from Shim of Yonhap News.
QUESTION: Okay, my name is In Sung Shim from the Yonhap News Agency in Korea. I have a question to you, the first to --
(Via interpreter) North-South Korea relations are improving and U.S. alliances stronger. I believe the Six-Party Talks is most important in continuing this trend, so I would like to ask for your opinion on that and --
The U.S. prepared to reduce its military presence in Asia if North Korea rejoining – if rejoin nuclear negotiation. Can you be more specific what it means – (inaudible) --
And one more last question. Can --
SECRETARY KERRY: What was the second part?
QUESTION: Second, do you have any plan to talk or negotiate with North Korea about that?
PARTICIPANT: (Inaudible.)
QUESTION: Yeah. Nuclear negotiation. And then one more last question is: Can you visit North Korea and to meet North Korea leader Kim Jong-un, if they release two – I mean two – the other detainee – American detainee?
SECRETARY KERRY: Can we what?
QUESTION: Can you go – I mean, can you visit --
SECRETARY KERRY: Oh, can I visit? (Laughter.)
QUESTION: Yes. Can you visit North Korea and to meet North Korea leader Kim Jong-un if they release the other two American detainee? Okay, thanks.
SECRETARY KERRY: Do you know something about an invitation that I – (laughter) --
Go ahead.
FOREIGN MINISTER YUN: Should I first?
SECRETARY KERRY: Yeah.
FOREIGN MINISTER YUN: Okay.
(Via interpreter) On the prospects of the Six-Party Talks, the North Korean nuclear development, as well as its efforts toward economic development, these have to be given up. As stated in our joint statement, we need to have a clear stance on their nuclear policy, North Korea’s denuclearization, and a halt to the sophistication of its nuclear weapons. All of these have to be real. It has to lead to real solutions. To that end, between Korea and U.S. and between Korea, U.S., and China, we have had many talks with the governments. We have had many talks. And Secretary Kerry has also recently reiterated that in order to advance these – a resolution to these issues, we need to be able to generate more creative ideas. So we will have more consultations on that.
SECRETARY KERRY: So let me make it absolutely clear that the mere entering into talks is not an invitation to take any actions regarding troops or anything else at this point. It would be way too premature to have any thought or even discussion about such a thing. The only purpose of entering the talks is to come to an understanding regarding, first, the denuclearization, and then following the denuclearization, obviously, whatever relationship might be appropriate. But it is entirely premature to be talking about any troop reductions or anything else at this point in time, as it is also premature to have any thoughts about visits at this point in time.
The first thing you have to do is come to a competent, real, authentic set of talks about denuclearization, and that is the prerequisite to any other possibilities thereafter.
MS. PSAKI: Thank you, everyone.
SECRETARY KERRY: Thank you all very much, appreciate it.
FOREIGN MINISTER YUN: Thank you very much.
SECRETARY KERRY: Thank you. Thank you, sir.
TWO CHARGED, ONE PLEADS GUILTY IN COSTA RICAN TELEMARKETING SCHEME
FROM: U.S. JUSTICE DEPARTMENT
Thursday, October 23, 2014
Two Individuals Charged, Third Pleads Guilty For Roles In Costa Rican Telemarketing Schemes Targeting U.S. Residents
A California woman pleaded guilty today for her role in a half-million-dollar “sweepstakes fraud” scheme that was run from Costa Rica and targeted U.S. residents. A Costa Rican national and an Ohio resident were also indicted for their roles in separate but similar schemes earlier this week.
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division and U.S. Attorney Anne M. Tompkins of the Western District of North Carolina made the announcement.
Patricia Diane Clark, 56, of Sacramento, California, pleaded guilty today before U.S. Magistrate Judge David S. Cayer of the Western District of North Carolina to conspiracy to commit wire fraud, wire fraud, and conspiracy to commit money laundering, all in connection with a Costa Rican telemarketing fraud scheme that targeted U.S. residents.
According to Clark’s plea agreement, from approximately 2007 through February 2013, her co-conspirators called U.S. residents from Costa Rican call centers, falsely informing them that they had won a substantial cash prize in a “sweepstakes.” The victims, many of whom were elderly, were told that in order to receive the prize, they had to send money for a purported “refundable insurance fee.” Clark admitted that she picked up money from the victims and sent it to her co-conspirators in Costa Rica. Clark also admitted that she managed others who picked up money from the victims in the United States and that she kept a portion of the victims’ payments.
Also according to Clark’s plea agreement, once the victims sent money, Clark’s co-conspirators contacted the individuals again and falsely informed them that the prize amount had increased, either because of a clerical error or because another prize winner was disqualified. The victims then had to send additional money to pay for new purported fees to receive the now larger sweepstakes prize. The attempts to collect additional money from the victims continued until an individual either ran out of money or discovered the fraudulent nature of the scheme.
Clark admitted that, along with her co-conspirators, she was responsible for approximately $640,000 in losses to hundreds of U.S. citizens.
Additionally, earlier this week, Marco Vinicio Fallas Hernandez, 41, a Costa Rican citizen, was charged in a superseding indictment in the Western District of North Carolina with one count of conspiracy to commit wire fraud, ten counts of wire fraud, one count of conspiracy to commit money laundering, and nine counts of international money laundering in connection with a similar telemarketing scheme. According to the indictment, Hernandez and his co-conspirators were responsible for causing approximately $10,000,000 in losses to hundreds of U.S. citizens, many of whom are elderly. Eight individuals, including Hernandez, are charged in the superseding indictment.
Separately, Paul Ronald Toth Jrj., 38, a resident of Bloomingdale, Ohio, was indicted in the Western District of North Carolina this week on one count of conspiracy to commit money laundering and six counts of international money laundering. According to the indictment, between November 2009 and November 2010, Toth and others he supervised received money from victims of a Costa Rican telemarketing scheme. Toth allegedly kept some of the proceeds and wired the remainder to Costa Rica using numerous persons as senders and recipients, all in a manner designed to conceal and disguise the fraudulent source and nature of the transactions. Toth is alleged to have received more than $300,000 of illegal proceeds during the scheme.
The charges contained in an indictment are merely accusations, and a defendant is presumed innocent unless and until proven guilty.
These cases were investigated by the U.S. Postal Inspection Service, FBI, Internal Revenue Service, Federal Trade Commission, and Department of Homeland Security. These cases are being prosecuted by Senior Litigation Counsel Patrick Donley and Trial Attorneys William Bowne and Anna Kaminska of the Criminal Division’s Fraud Section.
COURT ORDERS WORK-AT-HOME COMPANY, PRESIDENT TO PAY $25 MILLION JUDGEMENT
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, October 22, 2014
Federal Court Enters Order and $25 Million Judgment Against Los Angeles Area Work-at-Home Scheme
An order of permanent injunction against The Zaken Corp. of Thousand Oaks, California, and company president Tiran Zaken, of Calabasas, California, was entered today by U.S. District Court Judge Dean D. Pregerson, finding that they made false and misleading statements in marketing work-at-home business opportunities and promising commissions to consumers, the Justice Department announced. In a written opinion entered Sept. 18, the court found that 110,000 consumers had bought the defendants’ program and “more than 99.8 percent never earned any commission whatsoever.” The court ordered the defendants to pay $25,406,781 as redress for consumer injury.
“This order reflects the Department of Justice’s commitment to protecting consumers from fraud schemes,” said Acting Assistant Attorney General Joyce R. Branda of the Justice Department’s Civil Division. “Those who take advantage of Americans searching for an honest day’s work, depriving them of their savings, will be held accountable.”
The Zaken Corp. sold consumers a “Wealth Building Home Business Plan” called QuikSell. For an initial investment of $148, consumers became Associates of QuikSell Liquidations and received a manual including instructions on how to locate excess inventory. The defendants represented that once purchasers of the opportunity identified businesses interested in selling excess inventory, The Zaken Corp. would find a buyer for the inventory. If The Zaken Corp. succeeded in negotiating a sale of the inventory, it promised to give the associate a “commission” equal to half the profit on the sale.
The Zaken Corp. and Tiran Zaken lured customers with claims that purchasers of their program could expect that “two to four hours a week working this business will earn participants an average of $3,000 to $6,000.” They further claimed that “the average commission checks associates get … will be approximately $4,280!” In the court’s written decision, Judge Pregerson of the Central District of California found that “fewer than one percent of consumers ever earned any income at all.”
Once consumers purchased the QuikSell program, they were inundated with advertisements to purchase additional business “tools” costing hundreds or thousands of dollars. The court found that consumers were encouraged to spend an additional $2,300 if they were “serious about this business and … really wanted to make the kind of money others have made.” However, after making this additional investment, consumers received only a directory consisting of “largely outdated telephone numbers of companies who were out of business.”
The court found that The Zaken Corp. and Tiran Zaken violated the Federal Trade Commission Act by making false claims regarding the earnings potential of QuikSell. The court also found that The Zaken Corp. and Tiran Zaken violated the Federal Trade Commission (FTC)’s Business Opportunity Rule, which requires sellers of business opportunities to provide specific, truthful information to help consumers evaluate a business opportunity prior to purchase. The FTC promulgated an updated Business Opportunity Rule in 2012, in order to protect consumers from exactly this sort of work-at-home scheme, in which sellers lure victims with false representations of substantial earnings.
Pursuant to the injunction issued by the court, The Zaken Corp. and Tiran Zaken are permanently banned from advertising or selling any work-at-home opportunity or business opportunity.
This case was brought by the Department of Justice as part of “Operation Lost Opportunity,” a sweep of business opportunity fraud cases coordinated by the FTC. Trial Attorneys Ann Entwistle and Lisa Hsiaoof of the Justice Department’s Consumer Protection Branch litigated this case with support from Dana Barragate of the FTC’s East Central Region, the FTC’s Division of Marketing Practices and Assistant U.S. Attorney Anoiel Korshid in the Central District of California.
FISH DEALER RECEIVES PRISON SENTENCE FOR ROLE IN UNDER-REORTING FOUNDER HARVEST
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, October 22, 2014
Brooklyn Fish Dealer Sentenced To Four Months For Wire Fraud
On April 23, 2014, Alan Dresner pleaded guilty to one count of wire fraud. The scheme involved his personal falsification and internet submission of at least 120 fisheries dealer reports from July 2009 to December 2011, as part of a scheme to defraud the United States of 246,376 pounds of overharvested and underreported fluke valued at $510,000.
As part of his sentence, Dresner will serve four months in prison followed by three years of supervised release. The defendant was fined $6000 and ordered to make a $15,000 community service payment to the Cornell Cooperative Extension of Suffolk County in order to pay for the enhancement of fluke habitat in the waters of Long Island through the C.C.E.’s Marine Meadows Program. Dresner was ordered to pay $510,000 in restitution to the Marine Resources Account of the New York State Conservation Fund. Dresner was also ordered to surrender his federal dealer license and was banned from accessing the National Oceanic and Atmospheric Administration’s (NOAA) SAFIS computer system.
“Today, Dresner was held accountable for his role in defrauding a federal research program, a program whose purpose is to help ensure the long-term sustainability of Long Island’s fisheries,” said Acting Assistant Attorney General Sam Hirsch for the Justice Department’s Environment and Natural Resources Division. “We are committed to protecting the natural resources that the American people depend on today and for future generations as well.”
“This scheme to land tremendous amounts of overages for profit was not only detrimental to the RSA program, but also to the law abiding fishermen who will not be able to participate in this program in 2015,” said NOAA Special Agent Logan Gregory. “The Office of Law Enforcement will continue to focus on ensuring a level playing field by investigating these types of environmental crimes.”
Alan Dresner is “Fish Dealer X” as that person is identified in the related case of U.S. v. Anthony Joseph. As a federal fish dealer, Dresner had a NOAA permit to purchase fish directly from commercial fishing vessels without having to go through an intermediary. In July 2009, Dresner learned that Anthony Joseph, captain of the F/V Stirs One, was consistently overharvesting fluke through Joseph’s abuse of the RSA Program. By July 2009, Dresner was making regular purchases of illegal fluke from Joseph at the Point Lookout, New York, waterfront.
In order to cover-up his illegal fishing, Joseph would mail falsified fishing logs, known as FVTRs, to NOAA. However, falsified FVTRs were just one side of the coin. This is because fish dealers are required to report their purchases to NOAA on an electronic form known as a dealer report. The dealer reports include information such as date of landing, port of landing, catch vessel, corresponding FVTR numbers, commercial grade, species, price, and weight. NOAA utilizes the data in the dealer reports to set quotas and implement other management measures designed to ensure a sustainable fisheries. The dealer reports also serve as a check on the information that is submitted in FVTRs. In other words, for their scheme to work, the false data on the FVTRs had to match the false data on the dealer reports. A mismatch would have indicated a serious error or fraud, and would have been a red flag for fisheries managers. Accordingly, during July 2009 to December 2011, the defendant schemed with Anthony Joseph to file at least 120 false dealer reports with NOAA, representing a loss of 246,376 pounds of fluke valued at $510,000.
Theft of domestic marine resources has far-reaching consequences beyond illicit financial gain. Fisheries managers operate on the basic assumption that fishers and dealers make accurate and honest reports to NOAA. When harvested fish is misreported or unreported, the integrity of fisheries statistics and associated mathematical models are jeopardized. Recently, based in large part on the recently quantified illegal fluke harvesting revealed by the guilty pleas in the Jones Inlet Seafood, Charles Wertz Jr., Anthony Joseph, and Dresner cases, on Aug. 12, 2014, the Mid-Atlantic Fisheries Management Council voted to suspend the RSA Program for 2015 in order analyze the effect illegal fishing has had on the soundness of the RSA Program.
Anthony Joseph pleaded guilty to wire fraud, mail fraud, and falsification of federal records on April 11, 2014, for his fisheries fraud crimes related to Alan Dresner and Jones Inlet Seafood. He is scheduled to be sentenced on May 20, 2015.
The case was investigated by agents of NOAA’s National Marine Fisheries Service, with assistance from the New York State Department of Environmental Conservation Police. The case is being prosecuted by Christopher L. Hale of the Justice Department’s Environmental Crimes Section, Environment and Natural Resources Division.
Friday, October 24, 2014
DOJ ANNOUNCES FARC TERRORIST MEMBER RECEIVES 27 YEAR PRISON FOR 2003 HOSTAGE-TAKING
FROM: U.S. JUSTICE DEPARTMENT
Friday, October 24, 2014
Member of FARC Terrorist Organization Sentenced to 27 Years in Prison on Hostage-Taking Charges in 2003 Capture of U.S. Citizens
Alexander Beltran Herrera, 38, a commander of the Fuerzas Armadas Revolucionarias de Colombia (FARC) terrorist organization, was sentenced today to 27 years in prison on federal hostage-taking charges stemming from the 2003 capture of three U.S. citizens in Colombia. All told, members of the FARC held the Americans hostage for 1,967 days.
The sentence was announced by John P. Carlin, Assistant Attorney General for National Security, Ronald C. Machen Jr., U.S. Attorney for the District of Columbia and George L. Piro, Special Agent in Charge of the FBI’s Miami Division.
Beltran Herrera, aka Jhon Alexander Beltrain Herrera, aka Rodrigo Pirinolo, pled guilty on March 18, 2014, in the U.S. District Court for the District of Columbia, to three counts of hostage-taking. He was sentenced by the Honorable Senior Judge Royce C. Lamberth.
“In February 2003, the FARC – a Colombian terrorist organization – kidnapped three American citizens and held them captive for nearly 2,000 days,” said Assistant Attorney General Carlin. With the sentence handed down today, Alexander Beltran Herrera is being held accountable for his role in those offenses. This case underscores our resolve to pursue and bring to justice those who target our citizens with violence anywhere in the world. I want to thank all of the prosecutors, agents, and analysts who made this result possible.”
“This Colombian terrorist will spend the next 27 years in an American prison for his role in holding three U.S. citizens captive overseas,” said U.S. Attorney Machen. “Our fellow citizens were held hostage for more than five years under brutal conditions. This extradition, prosecution, and incarceration should chasten terrorists who doubt our resolve to serve justice on those who harm American citizens on foreign soil.”
“Alexander Beltran Herrera, a former terrorist commander for the Fuerzas Armadas Revolucionarias de Colombia (FARC), will now be held accountable for his role in holding three U.S. citizens hostage in Colombia for 1,967 days,” said Kelly M. Darden, Acting Special Agent in Charge of the FBI’s Miami Division. “Essential to bringing Beltran Herrera to justice was our close cooperation with the Colombian National Police.”
According to the government’s evidence, the FARC is an armed, violent organization in Colombia. Since its inception in 1964, it has engaged in an armed conflict to overthrow the Republic of Colombia, South America’s longest-standing democracy. The FARC has consistently used hostage taking as a primary technique in extorting demands from the Republic of Colombia, and hostage taking has been endorsed and commanded by FARC senior leadership. The FARC has characterized American citizens as “military targets” and has engaged in violent acts against Americans in Colombia, including murders and hostage taking. The FARC was designated as a foreign terrorist organization by the U.S. Secretary of State in 1997 and remains so designated.
Beltran Herrera, a commander in the FARC, was involved in the hostage taking of three United States citizens: Marc D. Gonsalves, Thomas R. Howes, and Keith Stansell. These three, along with Thomas Janis, a United States citizen, and Sergeant Luis Alcides Cruz, a Colombian citizen, were seized on Feb. 13, 2003, by the FARC, after their single-engine aircraft made a crash landing in the Colombian jungle.
Members of the FARC murdered Janis and Cruz near the crash site. Gonsalves, Howes, and Stansell were held by the FARC at gunpoint and were advised by FARC leadership that they would be used as hostages to increase pressure on the government of Colombia to agree to the FARC’s demands. At various times, the FARC marched the hostages from one site to another, placing them in the actual custody of various FARC fronts.
At the conclusion of one 40-day long march, in or about November 2004, the hostages were delivered to members of the FARC’s 27th Front, who imprisoned the hostages for nearly two years. During part of this period, Beltran Herrera was responsible for moving the hostages and keeping them imprisoned. Throughout the captivity of these three hostages, FARC jailors and guards used choke harnesses, chains, padlocks and wires to restrain the hostages, and used force and threats to continue their detention and prevent their escape. In July 2008, the Colombian military conducted a daring operation which resulted in the rescue of the hostages.
Beltran Herrera was indicted in February 2011 and was extradited to the United States from Colombia in March 2012.
This case was investigated by the FBI’s Miami Division. The prosecution was handled by Assistant U.S. Attorneys Anthony Asuncion and Fernando Campoamor-Sanchez from the National Security Section of the U.S. Attorney’s Office for the District of Columbia, and Trial Attorney David Cora, from the Counterterrorism Section of the Justice Department’s National Security Division. The case was indicted by Assistant U.S. Attorney Kenneth Kohl, of the National Security Section of the U.S. Attorney’s Office.
The FBI’s Miami Division partnered in the investigation with the Justice Department’s Office of International Affairs, the Department’s Judicial Attachés in Colombia, and the FBI’s Office of the Legal Attaché in Bogota, Colombia. The Directorate of Intelligence (DIPOL) and the Anti-Kidnapping Unit (GAULA) of the Colombian National Police also provided valuable support during the investigation.
REMARKS WITH SIR ELTON JOHN BEFORE THEIR MEETING
FROM: U.S. STATE DEPARTMENT
Remarks
John Kerry
Secretary of State
Outer Office
Washington, DC
October 24, 2014
SECRETARY KERRY: It’s my enormous pleasure to welcome Sir Elton John here to the State Department. We met a few years ago when we were talking and I was still in the Senate about the challenge of PEPFAR and creating the next AIDS-free – the AIDS-free generation. I want to thank Sir Elton for his tremendous leadership almost from the beginning of the challenge of HIV/AIDS. And his foundation, the Elton John AIDS Foundation, has been critical in bringing hope and help to a lot of people.
So it’s my pleasure today to be able to announce a $7 million partnership between PEPFAR and the Elton John Foundation which will help bring additional assistance to people and help us meet this goal of an AIDS-free generation. And I want to thank him very, very much for his extraordinary leadership. We’re going to continue to work together to bring this help to all those folks, particularly in the LGBT community, who need this particular assistance. And we think it’ll make a difference, as he has through the years. So thank you, sir.
SIR ELTON JOHN: Thank you. I’d like to thank Secretary Kerry for taking the time to see me, for his tireless work from the word “go” to create an AIDS-free world. He has been relentless in that. And also, hearing the Obama Administration’s loud, loud voice that everyone in the world should be – we should be living in an AIDS-free world, and that people, no matter who they love, who they are, should have a right to be AIDS-free.
To be able to combine with PEPFAR, from our foundation’s point of view, is a dream come true, because together, you double the effect. I think from the beginning of the AIDS crisis, there were so many different foundations, and what’s happened is that now, there’s a few of us left. We’re probably the smallest of them all, but we combine with PEPFAR and everybody else. We all work together to ensure that in this day and age, nobody gets left behind no matter what their sexuality, their color, or whatever. It’s important. If people get left behind, the disease will get left behind, and we will face an enormous uphill battle.
So this partnership that we’re doing today is an incredibly important step to, again, ensuring that people in the future will be living in an AIDS-free society. That’s been my goal ever since we started this foundation, and I know it’s Secretary Kerry’s goal as well and the Obama Administration’s goal. Together, we’re fighting it, and I’m very optimistic that we can make a huge difference. This is a very, very big deal. We’re opening this and doing this in South Africa, and – this first joint venture and it’s a historic adventure – a venture and an adventure.
So thank you, Senator Kerry, for your help; thank you, PEPFAR; and together, I think we will do great work, and we have a lot more work to do, but this is a good start.
SECRETARY KERRY: Thank you, sir, very, very much. Thank you. Nice comments.
U.S. CONDEMNS TERRORIST ATTACK IN SINAI THAT KILLED SEVERAL EGYPTIAN SOLDIERS
FROM: U.S. STATE DEPARTMENT
U.S. Condemns Terrorist Attack in Sinai
Press Statement
Jen Psaki
Department Spokesperson
Washington, DC
October 24, 2014
The United States strongly condemns the terrorist attack that targeted a military checkpoint in the Sinai near al-Arish, and killed tens of Egyptian soldiers and injured dozens. We extend our condolences to the families of the victims, and hope for the quick and full recovery of the wounded. A prosperous and dynamic Egypt requires an environment of security and stability, and the United States continues to support the Egyptian government’s efforts to counter the threat of terrorism in Egypt as part of our commitment to the strategic partnership between our two countries.
THE USS CARL VINSON DEPLOYED SUPPORTING STRIKE OPERATIONS IN IRAQ AND SYRIA
FROM: U.S. DEFENSE DEPARTMENT
An F/A-18E Super Hornet sits on the flight deck of the aircraft carrier USS Carl Vinson at sea, Oct. 16, 2014. The Carl Vinson and its embarked air wing, Carrier Air Wing 17, are deployed supporting maritime security operations, strike operations in Iraq and Syria as directed, and theater security cooperation efforts in the U.S. 5th Fleet area of responsibility. The aircraft is assigned to Strike Fighter Squadron 81. U.S. Navy photo by Petty Officer 2nd Class John Philip Wagner, Jr.
An EA-18G Growler makes an arrested landing on the flight deck of the aircraft carrier USS Carl Vinson in the U.S. 5th Fleet area of responsibility, Oct. 16, 2014. U.S. Navy photo by Petty Officer 2nd Class John Philip Wagner, Jr.
PRESIDENT OBAMA, SECRETARY HAGEL OFFER ASSISTANCE TO CANADA
Right: Lisa Monaco, assistant to the president for homeland security and counterterrorism, updates President Barack Obama in the Oval Office on the shooting in Canada prior to his phone call with Prime Minister Stephen Harper, Oct. 22, 2014. White House Photo by Pete Souza.
Obama, Hagel Offer Canada Assistance after Attacks
By Cheryl Pellerin
DoD News, Defense Media Activity
WASHINGTON, Oct. 23, 2014 – President Barack Obama and Defense Secretary Chuck Hagel have offered condolences, assistance and continuing close partnership to Canadian Prime Minister Stephen Harper, the people of Canada and the family and friends of two soldiers killed in attacks there this week.
In remarks yesterday, Harper praised Warrant Officer Patrice Vincent, who was killed in a hit-and-run attack “by an ISIL-inspired terrorist,” and Cpl. Nathan Cirillo of the Argyll and Sutherland Highlanders, who was “murdered in cold blood” as he provided a ceremonial Honor Guard at Canada’s National War Memorial.
Both assailants were killed.
Yesterday, Obama and Hagel both made statements about the attacks.
“I had a chance to talk with Prime Minister Harper this afternoon,” Obama said during a White House press conference on the U.S. response to the West Africa Ebola crisis. “Obviously, the situation there is tragic … and I expressed on behalf of the American people our condolences to the family and to the Canadian people as a whole.”
Statement by Chuck Hagel
In his statement, Hagel said he joined all the men and women of the U.S. Department of Defense in offering his deepest condolences to the family and friends of the soldiers killed in this week's appalling attacks on members of the Canadian Armed Forces.
“The United States strongly condemns today's shootings in Ottawa,” the secretary added, “as well as the hit-and-run attack in Quebec earlier this week. The United States has no closer friend and ally than Canada, and the United States military has no closer partner than the Canadian Armed Forces.”
Hagel said the Defense Department, “including through the North American Aerospace Defense Command, will continue to monitor the situation closely and stands ready to assist our Canadian allies in the aftermath of these tragic events.”
The North American Aerospace Defense Command, based in Colorado and also known as NORAD, is a combined organization of the United States and Canada that provides aerospace warning, air sovereignty and defense for Northern America.
Vigilance is essential
From the Oval Office, Obama said the attacks emphasize the degree to which nations must remain vigilant when it comes to dealing with acts of senseless violence or terrorism.
“I pledged, as always, to make sure that our national security teams are coordinating very closely, given not only that Canada is one of our closest allies in the world but they’re our neighbors and our friends,” Obama said.
When it comes to dealing with terrorist activity, the president added, Canada and the United States have to be entirely in sync.
Obama said he’s traveled to the Canadian Parliament in Ottawa and recalled how warmly he was received; adding that during his call with Harper, the prime minister appreciated expressions of concern by the American people.
The attacks in Canada will have to be factored into ongoing efforts in the United States to counter terrorist attacks in this country, the president said.
“Every single day we have a whole lot of really smart, really dedicated, really hardworking people … who are monitoring risks and making sure that we’re doing everything we need to do to protect the American people,” he said. “And they don’t get a lot of fanfare; they don’t get a lot of attention.”
Many possible threats are foiled or disrupted that don’t always get reported on, the president said.
“The work of our military, our intelligence teams, the Central Intelligence Agency, the intelligence community more broadly, our local law enforcement and state law enforcement officials who coordinate closely with us,” Obama said, “we owe them all a great deal of thanks.”
4 FORMER BLACKWATER SECURITY GUARDS FOUND GUILTY FOR ROLES IN NISUR SQUARE SHOOTING IN IRAQ
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, October 22, 2014
Four Former Blackwater Employees Found Guilty of Charges in Fatal Nisur Square Shooting in Iraq
Four former security guards for Blackwater USA were found guilty of charges stemming from the Sept. 16, 2007, shooting at Nisur Square in Baghdad, Iraq, that resulted in the killing of 14 unarmed civilians and the wounding of numerous others.
The jury verdicts, in the U.S. District Court for the District of Columbia, were announced by Ronald C. Machen Jr., U.S. Attorney for the District of Columbia, and Andrew G. McCabe, Assistant Director in Charge of the FBI’s Washington Field Office.
The defendants include Nicholas Abram Slatten, 30, of Sparta, Tenn.; Paul Alvin Slough, 35, of Keller, Texas; Evan Shawn Liberty, 32, of Rochester, N.H.; and Dustin Laurent Heard, 33, of Maryville, Tenn. Slatten, who was accused of firing the first shots, was found guilty of one count of first-degree murder. Slough was found guilty of 13 counts of voluntary manslaughter, 17 counts of attempted manslaughter, and one firearms offense. Liberty was found guilty of eight counts of voluntary manslaughter, 12 counts of attempted manslaughter, and one firearms offense. Heard was found guilty of six counts of voluntary manslaughter, 11 counts of attempted manslaughter, and one firearms offense.
“This verdict is a resounding affirmation of the commitment of the American people to the rule of law, even in times of war,” said U.S. Attorney Machen. “Seven years ago, these Blackwater contractors unleashed powerful sniper fire, machine guns, and grenade launchers on innocent men, women, and children. Today they were held accountable for that outrageous attack and its devastating consequences for so many Iraqi families. I pray that this verdict will bring some sense of comfort to the survivors of that massacre. I want to thank the prosecutors and law enforcement agents who have fought for the past seven years to bring justice to the memories of those who were gunned down in Nisur Square.”
“Today’s verdict demonstrates the FBI's dedication to investigating violations of U.S. law no matter where they occur,” said Assistant Director in Charge McCabe. “International investigations such as this one are very complex and frequently dangerous. This case took a tremendous amount of coordination to bring over a large number of foreign witnesses in support of this prosecution. I commend the FBI Special Agents, Task Force Officers, Intelligence Analysts and Language Specialists and our partners at the U.S. Attorney’s Office for working to bring those responsible to justice and conveying some measure of comfort to the victims’ families in Iraq.”
The verdicts came on the 28th day of jury deliberations and followed more than two months of trial. The Honorable Senior Judge Royce C. Lamberth ordered that the four defendants be detained pending sentencing. A sentencing date has not yet been set.
The murder charge against Slatten calls for a mandatory sentence of life in prison. Each of the voluntary manslaughter counts against the other defendants carries a statutory maximum of 15 years in prison. Each of the attempted manslaughter counts carries a statutory maximum of seven years of incarceration. The weapons offense carries a mandatory 30-year prison sentence.
Another Blackwater security guard, Jeremy P. Ridgeway, pled guilty in December 2008 to voluntary manslaughter and attempt to commit manslaughter. Ridgeway, who testified as a government witness in the trial, has not yet been sentenced.
The defendants worked for Blackwater USA, a private security contractor that was paid by the U.S. government to provide protective services to U.S. officials.
The trial began June 17, 2014. Over the next 10 weeks, the government presented testimony from 71 witnesses, including 30 from Iraq. This represented the largest group of foreign witnesses ever to travel to the United States for a criminal trial. The witnesses included 13 people who were wounded in the shootings, as well as relatives of many of those who died. The government’s witnesses also included nine members of “Raven 23,” the Blackwater team that was on the scene on the day of the shootings.
According to the government’s evidence, at approximately noon on Sunday, Sept. 16, 2007, several Blackwater security contractors, including the four defendants, opened fire in and around Nisur Square, a busy traffic circle in the heart of Baghdad. When they stopped shooting, 14 Iraqi civilians were dead. Those killed included 10 men, two women, and two boys, ages 9 and 11. Another 18 victims were injured.
The four defendants and 15 other Blackwater security contractors were assigned to a convoy of four heavily-armed trucks known as a Tactical Support Team, using the call sign “Raven 23.” Shortly before noon, Raven 23 learned that a car bomb had detonated in central Baghdad near a location where a U.S official was being escorted by a Blackwater personal security detail team. Raven 23 team members promptly reported to their convoy vehicles, and the convoy drove to a secured checkpoint between the Green Zone and Red Zone.
Once there, in disregard of an order from Blackwater’s command, the team’s shift leader directed Raven 23 to leave the Green Zone and establish a blockade in Nisur Square, a busy traffic circle that was immediately adjacent to the Green Zone. While occupying the southern part of the traffic circle, seven of the 19 members of Raven 23, including the four defendants and Ridgeway, fired their weapons, resulting in the deaths or injury of the unarmed Iraqi civilians there. While leaving the traffic circle, Slough continued to fire his weapon, resulting in additional deaths and injuries.
Finally, further away, north of the traffic circle, Slough and Ridgeway again fired their weapons, resulting in the injury of three more unarmed Iraqi civilians.
The first to be killed was Ahmed Haithem Ahmed Al Rubia’y, 21, an aspiring doctor, who was driving his mother to an appointment. His mother, Mahassin Mohssen Kadhum Al-Khazali, 44, a medical doctor, also was killed. Others who died included Ali Mohammed Hafedh Abdul Razzaq, 9, who was traveling with his family; Osama Fadhil Abbas, 52, a businessman who sold used cars and who was enroute to a business meeting; Mohamed Abbas Mahmoud, 47, a delivery truck driver, and his 11-year-old son, Qasim Mohamed Abbas Mahmoud; Sa’adi Ali Abbas Alkarkh, 52, a businessman; Mushtaq Karim Abd Al-Razzaq, 18, an Iraqi soldier who was standing at a military checkpoint; Ghaniyah Hassan Ali, 55, who was traveling with her daughter on a public bus, and who was in the area to get documentation for a trip to holy sites; Ibrahim Abid Ayash, 77, a gardener, who was traveling in another bus; Hamoud Sa’eed Abttan, 33, and his cousin, Usday Ismail Ibrahiem, 27, who were out looking for work with the Iraqi Army; Mahdi Sahib Nasir, 26, a taxi driver, and Ali Khalil Abdul Hussein, 54, a motorcyclist who was commuting to work.
The jury considered charges involving injuries to 14 men and three women. Because of travel issues, witnesses to support an 18th charge of attempted manslaughter did not appear at the trial, and the charge related to that victim’s injuries was dismissed by the government.
This case was investigated by the FBI’s Washington Field Office. The Iraqi Ministry of Interior and the Iraqi National Police provided cooperation and assistance in the investigation.
The case was prosecuted by Assistant U.S. Attorneys Anthony Asuncion, John Crabb, Jr., Christopher R. Kavanaugh, T. Patrick Martin, and David Mudd, of the National Security Section of the U.S. Attorney’s Office for the District of Columbia. The case was originally indicted by Assistant U.S. Attorneys Jonathan M. Malis and Kenneth Kohl.
SPAM TEXT MESSAGE, ROBOCALLING, MOBILE CRAMMING SCHEME DEFENDANTS TO PAY $10 MILLION TO SETTLE FTC CHARGES
FROM: U.S. FEDERAL TRADE COMMISSION
Defendants in Massive Spam Text Message, Robocalling and Mobile Cramming Scheme to Pay $10 Million to Settle FTC Charges
A series of defendants will pay approximately $10 million to the Federal Trade Commission to settle charges that they operated a massive scam that sent unwanted text messages to millions of consumers, many of whom later received illegal robocalls, phony “free” merchandise offers, and unauthorized charges crammed on their mobile phone bills.
The settlement marks the completion of a major effort by the FTC to crack down on the senders of unwanted text messages offering consumers “free” gift cards to retailers such as Best Buy, Walmart and Target. The messages contained links to websites that led consumers through a process that the FTC alleges was designed to get consumers’ personal information for sale to marketers, their mobile phone numbers to cram unwanted charges on their bill, and to drive them to paid subscriptions for which the scammers received affiliate referral fees.
“The operators of this scam bombarded consumers for months with deceptive text messages offering ‘free’ items, but the costs to consumers were very real – including the misuse of their personal information to cram unwanted charges on their phone bills,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “I am pleased that these scammers will be forced to turn over millions of the dollars they took from consumers and banned from repeating these actions in the future.”
The settlement resolves the FTC’s allegations against three groups of defendants:
The first set of defendants is required to pay the FTC $7.8 million. The FTC alleged that this group of defendants was responsible for millions of illegal text messages, made deceptive claims about “free” merchandise, was responsible for unauthorized charges on mobile phone bills, and assisted and facilitated the sending of illegal robocalls. Under the terms of the settlement, these defendants will be banned from sending consumers unwanted text messages, as well as from placing charges of any kind onto a consumer’s telephone bill, whether landline or mobile. The settlement also bans the defendants from misrepresenting whether a product is free through a text message or webpage, and also requires the defendants to ensure that any affiliates working for them abide by the same provisions. In addition, the settlement requires the defendants to obtain consumers’ express informed consent before billing them and bans them from participating in illegal telemarketing. The defendants in this settlement are Acquinity Interactive, LLC; 7657030 Canada Inc., Garry Jonas, Gregory Van Horn, Revenue Path E-Consulting Pvt, Ltd.; Revenuepath Ltd.; and Sarita Somani.
The second set of defendants is required to pay the FTC $1.4 million. The FTC alleged that this set of defendants was responsible for cramming unauthorized charges on consumers’ mobile phone bills. Under the terms of the settlement, the defendants will be banned from placing charges of any kind on consumers’ telephone bills, as well as being banned from making any misrepresentations to consumers about a product or service, including the cost or a consumer’s obligation to pay. In addition, the defendants will be required to obtain consumers’ express informed consent before billing them for any good or service. The defendants in this settlement are Burton Katz, individually and also doing business as Polling Associates Inc. and Boomerang International, LLC, and Jonathan Smyth, individually and also doing business as Polling Associates Inc.
In the third settlement, an $8 million judgment is being suspended due to the defendants’ inability to pay, after they turn over available assets. The FTC alleged that this set of defendants was responsible for making millions of illegal robocalls. Under the settlement, the defendants are required to pay the FTC $100,000, as well as the surrender value of a life insurance policy and proceeds from the sale of: a 2013 Cadillac Escalade, two motorcycles, and a real estate holding in Southern California. The settlement also bans the defendants from illegally telemarketing consumers through robocalling. The defendants in this settlement are Firebrand Group S.L., LLC, Worldwide Commerce Associates, LLC, and Matthew Beucler.
In addition to these settlements, the Commission dropped charges against two defendants in the cases, Joshua Greenberg and Scott Modist.
The Commission vote approving the proposed stipulated final orders was 5-0. Judge Robert N. Scola, Jr. of the U.S. District for the Southern District of Florida entered the stipulated final orders on Oct. 16, 2014
NOTE: Stipulated final orders have the force of law when approved and signed by the District Court judge.
PHYSICIAN SENTENCED TO PRISON FOR ROLE IN $200 MILLION MEDICARE FRAUD
FROM: U.S. JUSTICE DEPARTMENT
Tuesday, October 21, 2014
Miami-Area Physician Assistant Sentenced to 15 Years in Prison for $200 Million Medicare Fraud Scheme
Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office and Special Agent in Charge Derrick Jackson of the Health and Human Services Office of Inspector General’s (HHS-OIG) Florida region made the announcement.
Robert Bergman, 65, of Miami, was sentenced by U.S. District Judge Jose E. Martinez in the Southern District of Florida. In addition to the prison sentence, Bergman was ordered to pay more than $85.3 million in restitution, both jointly and severally with his co-conspirators.
After a six-day trial, on July 18, 2014, a federal jury in the Southern District of Florida found Bergman guilty of one count of conspiracy to commit health care fraud and wire fraud, and one count of conspiracy to make false statements relating to health care matters.
Evidence at trial demonstrated that Bergman and his co-conspirators submitted false and fraudulent claims to Medicare through ATC, which operated purported partial hospitalization programs (PHPs) in seven different locations throughout South Florida and Orlando. A PHP is a form of intensive treatment for severe mental illness.
Evidence at trial also demonstrated that Bergman and other medical professionals at ATC fabricated and signed fraudulent medical documentation and patient files in order to justify ATC’s fraudulent billings to Medicare. Included in these false submissions to Medicare were claims for patients who were ineligible for PHP treatment because they were in neuro-vegetative states, in the late stages of diseases causing permanent cognitive memory loss, or had substance abuse issues and were living in halfway houses. Many of these patients were forced by assisted living facility owners and halfway house owners to attend ATC, and they did not receive treatment for their actual medical conditions.
ATC, an associated management company, and more than 20 individuals, including ATC’s owners, have all previously pleaded guilty or been convicted at trial. Bergman has been in federal custody since his conviction.
The case is being investigated by the FBI and HHS-OIG and was brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. The case is being prosecuted by Assistant Chief Robert A. Zink and Trial Attorneys Nicholas E. Surmacz and Kelly Graves of the Criminal Division’s Fraud Section.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 1,900 defendants who have collectively billed the Medicare program for more than $6 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
2 CARDIOLOGISTS TO PAY $380,000 STEMMING FROM FALSE CLAIMS ACT VIOLATIONS ALLEGATIONS
FROM: U.S. JUSTICE DEPARTMENT
Tuesday, October 21, 2014
Kentucky Cardiologists Agree to Pay $380,000 to Settle False Claims Act Allegations Based on Illegal Referrals
The Department of Justice announced today that two cardiologists based in London, Kentucky, have agreed to pay $380,000 to resolve allegations that they violated the False Claims Act by entering into sham management agreements with Saint Joseph Hospital, also based in London, Kentucky, in exchange for the referral of cardiology procedures and other healthcare services to Saint Joseph.
“Physicians who place their financial interests above the well-being of their patients will be held accountable,” said Acting Assistant Attorney General Joyce R. Branda for the Civil Division. “The Department of Justice is committed to preventing illegal financial relationships that undermine the integrity of our public healthcare programs.”
Satyabrata Chatterjee and Ashwini Anand jointly owned Cumberland Clinic, a physician group that provided cardiology services. The government alleged that St. Joseph Hospital entered into sham agreements with Chatterjee and Anand, under which the physicians were paid to provide management services but did not in fact do so. The government further alleged that, in exchange for the sham agreements, Chatterjee and Anand agreed to enter into an exclusive agreement with St. Joseph to refer Cumberland Clinic patients to the hospital for cardiology and other services in violation of the Stark Law and the Anti-Kickback Statute. The Stark Law forbids a hospital from billing Medicare for certain services referred by physicians who have a financial relationship with the entity. The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by federal health care programs, including Medicare.
“Financial relationships between healthcare providers that put profits over patients are a threat to the programs upon which millions of Americans depend,” said U.S. Attorney Kerry Harvey for the Eastern District of Kentucky. “We will continue to use all the tools available to us to safeguard our federally funded healthcare programs from those who seek to profit from them through illegal means.”
In addition to payment of the settlement amount, which was based on Chatterjee and Anand’s financial ability to pay, Chatterjee and Anand have agreed to enter into integrity agreements with the Department of Health and Human Services-Office of Inspector General (HHS-OIG), which obligate them to undertake substantial internal compliance reforms and to commit to a third-party review of their claims to federal health care programs for the next three years.
“Physicians who accept kickbacks in exchange for referrals undermine the integrity of the medical profession," said Special Agent in Charge Derrick L. Jackson of the HHS-OIG Atlanta region. “OIG will continue to protect both patients and taxpayers by holding physicians and hospitals accountable for improper claims."
The government previously entered into a $16.5 million settlement with Saint Joseph Hospital for the allegedly sham management contracts the hospital executed with Chatterjee and Anand, as well as for allegedly billing for unnecessary and excessive cardiology procedures by other members of Chatterjee and Anand’s cardiology practice.
The settlement announced today stems from a complaint filed by three Lexington, Kentucky, cardiologists pursuant to the whistleblower provisions of the False Claims Act, which permit private persons to bring a lawsuit on behalf of the United States. The act permits the United States to intervene in the lawsuit and take over the allegations, as the government did in this case. The three whistleblowers, Drs. Michael Jones, Paula Hollingsworth and Michael Rukavina, will collectively receive $68,400.
This settlement illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009 by the Attorney General and the Secretary of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in this effort is the False Claims Act. Since January 2009, the Justice Department has recovered a total of more than $22.5 billion through False Claims Act cases, with more than $14.3 billion of that amount recovered in cases involving fraud against federal health care programs.
The investigation was conducted by the FBI, HHS-OIG, the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office for the Eastern District of Kentucky. The claims settled by this agreement are allegations only and there has been no determination of liability.
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