Client gets ripped off and sold out June 14, 2010
Posted by jefhenninger in Misc..Tags: Fraud
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I am representing a client now on a non-criminal matter but we began discussing his recent criminal case. I got so upset that I just had to write about it. I’ve heard many stories about people getting sold out from free or cheap attorneys. That is nothing new. What’s even worse though is when you pay out the nose and still get sold out.
This client had a business dispute with his family member who pressed criminal charges against him. His family hired an attorney for him. The attorney charged the client and the family almost $10,000. So you think that this guy would get great service right?
While these charges were felonies, they were not that serious. Thus, a $10,000 retainer was rather steep, especially for this attorney who was not known as a heavy hitter. Instead of fighting for the client, this attorney had him plea out and take probation. Guess what would have probably happened if he had a free attorney, went to trial and admitted to everything on the witness stand? Probation.
So, this client and his family paid almost $10,000 to do what he could have done for free. Not only do you have to make sure that you don’t get a cheap attorney that will sell you out, but make sure you don’t get an expensive attorney that will also rip you off in the process.
For much less money (and I am far from a cheap attorney) I probably could have gotten the felony charges dismissed or I would have taken the case to trial.
Five Doctors, Six Others Indicted for Participating in Million Dollar Medicare Fraud Ring May 25, 2010
Posted by jefhenninger in News.Tags: Fraud
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A federal grand jury returned a 20-count superseding indictment charging five doctors and six others with conspiracy to commit health care fraud. The defendants are as follows:
Dr. Alexander Popov, 44, of Los Angeles;
Dr. Ramanathan Prakash, 63, of Northridge;
Dr. Emilio Cruz III, 57, of Los Angeles;
Dr. Lana Le Chabrier, 62, of Santa Barbara;
Dr. Sol Teitelbaum, 82, of Los Angeles;
Migran Petrosyan, 39, of Burbank;
Khachatur Arutunyan, 51, Tujunga;
Shushanik Martirosyan, 43, of Glendale;
Zoya Belov, 35, of Carmichael;
Nazaret Salmanyan, 27, of Citrus Heights; and
Liw Jiaw Saechao, 44, of Sacramento.
This case is the product of an extensive investigation by the Office of the Inspector General, Department of Health and Human Services, and the Federal Bureau of Investigation.
The superseding indictment alleges that from February of 2006 through August of 2008, the defendants operated three health care clinics in Sacramento, Richmond, and Carmichael that submitted more than $5 million in fraudulent claims to Medicare.
The leader of the conspiracy, Vardges Egiazarian, 60, of Panorama City, was named in an original indictment that focused on the activities of the Richmond Clinic. The original indictment also charged Le Chabrier, Petrosyan, and Arutunyan, as well as Dr. Derrick Johnson with health care fraud.
According to Egiazarian’s guilty plea entered on August 12, 2009, he admitted that claims were submitted to Medicare for patients at each of the three clinics that the physicians did not treat and seeking reimbursement for procedures that were either unnecessary or never performed. Egiazarian admitted the clinic’s patients were recruited and transported to the clinic by individuals who were paid according to the number of patients they brought to the facility. Rather than being charged a co-payment, the patients were paid for their time and the use of their Medicare eligibility, generally $100 per visit. Some of the patients for whom billings were submitted at the Richmond Clinic were actually deceased on the date that they allegedly received services.
On November 6, 2009, Egiazarian was sentenced to six and a half years in prison and ordered to pay over $1.5 million to Medicare in restitution.
On September 9, 2009, Derrick Johnson entered a guilty plea to the original indictment. He admitted that hundreds of Medicare claims for services he allegedly performed at the Richmond clinic were submitted on his behalf, yet he had never set foot in the facility nor had he had any contact with its purported patients. He has yet to be sentenced.
The superseding indictment returned last Thursday adds both a conspiracy charge and allegations relating to the Richmond Clinic and adds the Sacramento and Carmichael Clinics. In sum, the superseding indictment charges that Doctors Popov, Prakash, Le Chabrier and Cruz each submitted applications to Medicare seeking approval to submit claims for medical services allegedly rendered at the clinics. Despite the approval of these applications, and the submission of over $5 million dollars worth of claims to Medicare, none of the doctors ever provided services or treatment at the clinics. As alleged in the indictment, clinic patients seldom received the services purportedly rendered in claims submitted to Medicare. Instead, Medicare-eligible patients were typically given cursory examinations and then paid $100 each for their trouble. The claims submitted to Medicare on behalf of these patients alleged that they received a variety of tests and treatments, including physical therapy sessions and sleep studies that were never performed at the clinics. The clinics maintained falsified medical files that held test results purportedly relating to the patients. In some instances, clinic employees performed procedures such as ultrasounds or blood draws on themselves or each other, and then placed the results in files relating to Medicare-eligible beneficiaries. The money paid by Medicare on these claims was distributed among the members of the conspiracy.
Woman Charged with Defrauding American Red Cross February 26, 2010
Posted by jefhenninger in News.Tags: Fraud, mail fraud
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With any disaster, you just know that there will be fraud. Years from now, we will hear about all of the fraud connected to the earthquake in Haiti. Years after Hurricane Katrina, we are just now hearing about:
CHRISTY ALEXANDER, age 24, a resident of Hammond, LA, who is charged in a one-count bill of information with mail fraud relating to fraudulent applications she made to the American Red Cross for financial assistance during the aftermath of Hurricane Katrina.
According to the bill of information, the American Red Cross made disaster assistance money of up to $1,565 available to those affected by the hurricanes of 2005 on a one-time only basis. The bill alleges that on three occasions between September 2005 and October 2005, ALEXANDER applied for and received disaster assistance funds from the Red Cross and based on these fraudulent applications, she obtained $2,830 from the American Red Cross that she was not entitled to.
Kind of a low money case for the Federal Government to be concerned with in my opinion. However, she sure picked the wrong event (Katrina) to involve herself with because it gets headlines which makes it easy for the Government to get involved.
Bernard Madoff “arrest net” widens with more arrests November 13, 2009
Posted by whitecollarcrimenews in News.Tags: computer crime, Fraud, Madoff, Ponzi scheme
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Thought the Bernie Madoff saga was over? Think again. The Government will not pack up shop with Madoff’s plea and sentencing. They will continue to arrest and prosecute just about anyone who can be connected to Madoff’s ponzi scheme.
The latest arrests are for two former computer programmers for Bernard Madoff’s investment firm on charges they helped cover up his massive fraud for more than 15 years. Jerome O’Hara and George Perez are charged with conspiracy, falsifying books and records of a broker-dealer, and falsifying books and records of an investment adviser. The Securities and Exchange Commission has alleged that they provided technical support to produce false documents and trading records.
Of course, the Government will have to prove that these men shared Madoff’s intent which may be very difficult. However, the fact that these men are even associated with Madoff will make it very difficult for the defense. In my opinion, this case turns on whether or not these men are just associated with Madoff or if there is some actual evidence such as cooperating witnesses, documents or emails that show the conspiracy.
The amount they were paid may impact the case as well since if they were over paid, then the extra compensation will make it more likely that they were in on it. If their salary was normal, then it will be less likely that they risked criminal prosecution with no “skin in the game”.
Story is here.
Quick plea in Atlantic City ballot fraud case is a good deal October 19, 2009
Posted by jefhenninger in News.Tags: Crime, Fraud, New Jersey, News
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New Jersey Attorney General Anne Milgram announced last week that a worker for the unsuccessful 2009 mayoral campaign of Atlantic City Councilman Marty Small pleaded guilty to engaging in fraud involving messenger absentee ballots during the June Democratic primary.
Ronald Harris of Atlantic City, pleaded guilty to a charge of third-degree conspiracy to commit absentee ballot fraud before Superior Court Judge Robert Neustadter in Atlantic County. Under the plea agreement, the state will recommend that Harris be sentenced to a term of probation, conditioned upon him serving up to 364 days in the Atlantic County Jail. He may face a fine of up to $15,000. I doubt he’ll do any jail time.
Harris was charged in a 10-count state grand jury indictment returned on Sept. 3, which also charged Councilman Small and 12 other campaign workers and operatives. The indictment resulted from an investigation led by the Division of Criminal Justice Corruption Bureau and the State Police Official Corruption Bureau South Unit.
In pleading guilty, Harris admitted that he conspired with others involved in Small’s mayoral campaign to submit false documents related to the procurement, casting, or tabulation of messenger absentee ballots in the Democratic primary in Atlantic City.
This seems like a pretty good deal as it keeps him out of prison and I doubt he’ll see any time.
Klause Cars and Trucks, Ocean City Car Dealership Raided September 6, 2009
Posted by whitecollarcrimenews in News.Tags: Fraud, New Jersey
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Opening in 1984, Klause Cars and Trucks seemed to have a good reputation in the Ocean City area. After this week’s events however, customers may soon change their minds. On Tuesday, the FBI raided the car dealership and hauled away dozens of boxes of documents.
The owner Harry Klause and his attorney, William Hughes Jr. either have no idea as to what is going on or pretended that they didn’t when questioned by the press. As the owner of a car dealership, Klause would clearly have an attorney on retainer most of the time. Hughes does practice criminal law but he also handles other matters for a big firm so you can’t read anything into the fact that he has an attorney or his choice of attorney.
Since he does not sell new cars from what I can tell, this does not seem to be related to the cash for clunkers program. One aspect of this story is important: the raid by way of the search warrant. First of all, if the FBI is involved, this is serious and is not simply ripping off a customer on one transaction. Instead, the allegation must involve some major fraud here. Second, the fact that the FBI sought and obtained a search warrant indicates that there is at least some evidence that criminal activity has occurred (or is occurring).
Third, the fact that the FBI raided the place and did not just send out a subpoena shows that the FBI is taking this very seriously and they are afraid that these documents could be destroyed. So, my guess is that this involves some type of bank fraud issue.
Story is here.
Undercover operation results in arrests of 8 unregistered contractors August 28, 2009
Posted by whitecollarcrimenews in News.Tags: Crime, Fraud, New Jersey, theft by deception
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“Operation Hammer Time,” as the sting was called, operated out of a house in Brick, which is owned by Brick Township. Between February and July, prosecutor’s Sgt. Kimberly Milana posed as a woman who wanted to renovate the property. Investigators targeted unregistered home-improvement contractors who advertised their services.
Milana asked them to go to the Brick house to give her estimates for various work on the house. In New Jersey, home improvement contractors must be registered with the state Division of Consumer Affairs. Failure to register is a fourth-degree crime which carries a potential prison term of 18 months.
The contractors charged in indictments with being unregistered are: David Nichols, of Lakewood; Thomas J. Smith, of Tuckerton; Stephen J. Sente, of Berkeley Township; James Hamilton, of Toms River; Nenad Brezanin, of Howell; Guy Gambarony, of Brick; James MacMillan, of Stratford; and Orlando Escobar, of Keyport.
Nichols and Smith also were charged with tampering with public records. They both allegedly made false statements on applications for a home-improvement registration. Smith was also charged with theft by deception of $7,000 from a customer.
Sente was charged in another indictment with four counts of theft, unregistered home-improvement contracting and electrical contracting without a permit. That indictment stemmed from an investigation that was underway before the prosecutor’s office started this operation.
For the guys facing just the one charge, a good attorney should be able to handle this case with little expense. For the other guys however, the cases are a little more complex. While I can easily deal with the theft charges, the fact that they are also unregistered creates an added problem. A good attorney would file a 404b motion to separate the charges and the State will argue that they are all part of the same scheme.
Story is here.
NJ law enforcement cracks down on fake dentists August 24, 2009
Posted by whitecollarcrimenews in News.Tags: Crime, Fraud, News
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In any low income, immigrant community, there are plenty of people that line up to take advantage of those who live outside of society. Say what you want about the immigration debate but no one should be taken advantage of. Unlicensed lawyers and dentists are common in these area as a the recent arrests of ten fake dentists show.
My problem with these cases is that it seems like everyone is lumped in together. There has to be a difference between simply being unlicensed and then recklessly or purposely hurting people. On the flip side, I think that society also ignores most of these scams so it is interesting that this crackdown is occurring.
You can read more about this issue here.
Alleged pill selling Doctors face even more criminal charges August 17, 2009
Posted by whitecollarcrimenews in News.Tags: Fraud, money laundering
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Every now and then as an attorney, you get a client that is in it really, really deep. The Sharma’s are those clients for two attorneys. At 59 years old, they both face enough charges that could result in a de facto life sentence. This is why it is important for attorneys to examine all financial documents to check for any possible money laundering and the extent of it. Clients have a way of minimizing the situation and leaving out important details. While you don’t want to call your client a liar, you don’t want to just accept their word for it either.
HOUSTON—A federal grand jury has returned a superseding indictment adding 35 more counts to the previously returned 29-count indictment against Dr. Arun Sharma and his wife, Dr. Kiran Sharma, M.D., United States Attorney Tim Johnson announced today. Drs. Arun and Kiran Sharma, both 59, operated the Allergy, Asthma, Arthritis and Pain Centers located at on Cole Street in Webster, Texas, and another on Garth Road in Baytown, Texas.
In the original 29-count indictment, the Sharmas were accused of conspiracy to defraud Medicare/Medicaid and private health care providers of more than $31 million by falsely claiming to have administered facet joint injections and blocks to patients and routinely prescribing excessive amounts of hydrocodone, Soma and Xanax to patients that were not for a legitimate medical purpose in exchange for cash payments. The doctors were alleged to have stored large amounts of cash received from the sale of hydrocodone prescriptions at their home. Kiran Sharma allegedly transported large amounts of cash received from the sale of the hydrocodone prescriptions to two safe deposit boxes—one each at Bank of America and Prosperity Bank.
The superseding indictment was returned late Thursday, Aug. 13, 2009. It charges Drs. Arun and Kiran Sharma with three new counts of illegally distributing controlled substances for hydrocodone and methadone prescriptions written to specific patients, four new counts of health care fraud, nine counts of mail fraud, conspiring to launder illegal proceeds and 18 counts of laundering their illegal proceeds by hiding the drug cash in their safe deposit boxes, moving the fraud proceeds between several accounts they controlled and sending fraud proceeds back to India. It is alleged Kiran Sharma visited the two safe deposit boxes a total of 61 times and transported more than $816,000 in cash to the boxes.
The new charges include accusations against the Sharmas of prescribing more than 8,000 tablets of hydrocodone to one patient over an eight-month period. In two other counts, they are charged with prescribing 540 tablets of hydrocodone to one patient on May 23, 2005, and another 540 tablets to the same patient on Dec. 5, 2005.
Additionally, the forfeiture notice provision of the original indictment has been expanded to include the following assets which the government intends to forfeit as proceeds/property derived from their alleged illegal activity: 12 pieces of real estate including the defendants’ Kemah residence and both of their clinics, 32 investment accounts, 23 bank accounts and the $1.5 million in cash seized from the defendants’ home and safe deposit boxes for a total of $31 million.
The court has ordered the Sharmas, who are free on bond, to appear in federal court on Aug. 21, 2009, for arraignment on the new charges.
Upon conviction, health care fraud carries a maximum penalty of 10 years in a federal prison and a $250,000 fine. The fraud conspiracy charge and the mail fraud counts each carry a maximum penalty of 20 years in a federal prison and a $250,000 fine. The drug conspiracy and the 10 Schedule III drug distribution counts carry a penalty of five years imprisonment and a $250,000 fine. The three new Schedule II drug distribution counts carry a penalty of 20 years imprisonment and a $1 million fine. The money laundering conspiracy and the individual money laundering counts carry a maximum penalty from 10 to 20 years and a fine of $250,000 to $500,000.
The criminal charges are the result of a joint investigation being conducted by agents of the FBI, Drug Enforcement Administration, the Department of Health and Human Services-Office of Inspector General and the Medicare Fraud Control Unit of the Texas Attorney General’s Office in conjunction with the Webster, League City and Baytown Police Departments. The case will be prosecuted by Assistant United States Attorney Al Balboni.
Title agent indicted for mortgage fraud involving fake resort August 12, 2009
Posted by whitecollarcrimenews in News.Tags: Fraud, Mortgage Fraud
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Government press releases never read well for the defendant. Sometimes people come up with dumb scams that have no chance of success and others are involved in complex business deals that fail. Even if there is no criminal activity, the Government will allege otherwise and it won’t be until you see the discovery and talk to your client that you see the other side of the story.
This press release is too vague for me to figure out which type of case this is. Based on what is here however, I can at least see some defenses here. When you combine a failed business with cooperating witnesses who will say anything to stay out of prison (or avoid a long stretch) then you will get a nice story about some horrible scammers. This is why it is so important for an attorney to follow the money. Blowing the money on bad business deals is the sign of a civil case while blowing the money on luxury items can be the sign of a white collar crime case.
BALTIMORE, MD—A federal grand jury has indicted Jay Leonard, age 43, of Alexandria, Virginia, today for mail and wire fraud in connection with scheme involving the fraudulent purchase of 25 properties in Maryland, the District of Columbia and Virginia and a scheme to solicit investors for a resort property that did not exist, announced United States Attorney for the District of Maryland Rod J. Rosenstein. The indictment was returned on August 11, 2009 and Leonard is scheduled to have his initial appearance in U.S. District Court in Baltimore today at 3:00 p.m.
According to the nine count indictment, February 2006 through September 2008, Leonard, a title agent, working with co-conspirator Osman Al-Bari and others, solicited funds from victims in Maryland for a $10 million spa resort in Spotsylvania County, Virginia, that Leonard, Al-Bari and others claimed they were developing. According to the indictment, Leonard used his position as title agent and falsely claimed that he was doing a closing for the spa resort. Based on those allegedly false representations, the Maryland victims transferred $478,000 to Leonard’s bank accoung.
The indictment further alleges that, working with Osman Al-Bari, Timothy Reed, Terrence White and others, Leonard served as the title agent for several straw purchasers who bought at least 20 properties in Maryland, Virginia and Washington, D.C. For example, the indictment alleges that co-conspirator Sabrina Weinberg purchased four properties for Al-Bari and others and was paid approximately $40,000 for the purchases. Weinberg and other straw purchasers used fraudulent loan applications and closing documents to qualify for the mortgages and to disguise the true buyer of the property. According to the indictment Jay Leonard had Weinberg sign false affidavits claiming that each property was her primary residence. Further, the indictment alleges that Leonard kicked back a portion of the settlement funds from the straw buyer properties, disguising the wire transfers on the closing documents as reimbursement for alleged “renovations” performed on the properties prior to closing by Brotherly Investment Group, a company owned by Al-Bari, Reed and White. The indictment alleges that for the Weinberg properties alone, Leonard sent wire transfers totaling $515,820 to Al-Bari, Reed and White.
According to the indictment, almost all of the properties Leonard was involved with went into foreclosure, causing actual losses of over $7 million.
Leonard faces a maximum sentence of 30 years in prison for each of four counts of mail fraud and five counts of wire fraud.
