Showing posts from June, 2009

Superseding Indictment Returned in Federal Kidnapping and Drug Case

Additional charges and defendants have been added to a federal case arising from the abduction of a boy from his Las Vegas home in October 2008.

Jose Lopez-Buelna, aka "Miguel," 48; Jesus Gastelum, aka "Jose," 35; and Erik Dushawn Webster, 44; all of Las Vegas, were each charged today in a superseding indictment with conspiracy to distribute a controlled substance, specifically to distribute five kilograms or more of cocaine.

Lopez-Buelna was also charged with conspiracy to launder money; conspiracy to commit kidnapping; kidnapping; conspiracy to commit hostage taking; hostage taking; and two counts of money laundering-promotion.

Gastelum was also charged with conspiracy to launder money; conspiracy to commit kidnapping; kidnapping; conspiracy to commit hostage taking; hostage taking; two counts of money laundering-promotion; and money laundering-monetary transaction.

Webster was also charged with conspiracy to launder money and money laundering-promotion, and Luis Veg…

Miami Physician Sentenced to 97 Months in Prison for Role in $10 Million Medicare Fraud Scheme

Miami physician Roberto Rodriguez, 54, was sentenced today to 97 months in prison for his role in a Medicare fraud scheme involving HIV infusion services. Rodriguez was also ordered to pay more than $9 million in restitution to the Medicare program during today’s sentencing hearing before U.S. District Judge Paul C. Huck.

Rodriguez pleaded guilty before Judge Huck on March 23, 2009, to conspiracy to commit healthcare fraud. In his guilty plea, Rodriguez admitted that he was a co-owner of and practicing physician at Midway Medical Center Inc. (Midway), a Miami clinic that purported to specialize in the treatment of HIV patients. Rodriguez admitted that, while at Midway, he and his co-conspirators routinely billed the Medicare program for services that were medically unnecessary and in many instances were never provided. Rodriguez further admitted that he purchased only a small fraction of the drugs that were purportedly administered to patients at the clinic.

Most of the services alleged…

Paybooks owner used client payments intended for taxes for personal expenses

Attorney General Andrew M. Cuomo today announced that his office has intervened to stop a Rochester-based payroll company that defrauded hundreds of area businesses out of millions of dollars through an elaborate scheme where the owner kept money intended for taxes, using it instead for business and personal expenses.

As part of the filing of a lawsuit, Cuomo obtained a court order freezing the assets of Paybooks, Inc. and its president, Jeffrey Sykes of Lime Kiln Road in Wayland. The order also appoints a receiver to operate the company and determine customer tax liability. An investigation by the Attorney General found that Sykes used his customers' money for personal and operating expenses when he should have been forwarding to governmental agencies as payroll tax payments. In total, Paybooks currently owes in excess of $2 million in late taxes, plus interest and penalties. The Attorney General's lawsuit against Sykes and Paybooks seeks restitution for customers and penaltie…

Latest Action in Cuomo's Ongoing Probe into Unlawful Debt Collection Practices

Attorney General Andrew M. Cuomo today announced that his office has shut down a New York collection operation that consisted of at least nine debt collection companies across Western New York, run by Buffalo resident Tobias Boyland. This is the latest action in Attorney General Cuomo's ongoing investigation of unlawful debt collection practices.

According to hundreds of consumer complaints filed with law enforcement agencies across the country, Boyland's employees violated state and federal law by routinely posing as law enforcement officials, threatening to arrest consumers and throw them in jail unless they made arrangements to pay the company immediately. Under the terms of the court order obtained today by Cuomo's office in Buffalo Supreme Court, Boyland's operation will shut down all of its companies in the Buffalo area. Attorney General Cuomo also announced that his Office executed search warrants on four of the operations known locations and on Boyland's res…


A popular Hickory Hills, Ill., banquet facility and country club will pay up to $690,000 to settle two lawsuits, charging sex and race discrimination and retaliation, brought by the U.S. Equal Employment Opportunity Commission (EEOC), the agency announced today.

Federal District Judge Rebecca Pallmeyer has entered a consent decree resolving the two lawsuits against Chateau Del Mar, Inc. and Hickory Properties, Inc., known as Hickory Hills Country Club. Under the decree, the defendants are required pay $590,000, including attorney's fees, to a class of women who endured a sexually hostile work environment and retaliation, and, in addition, up to another $100,000 to African American applicants who were denied hire because of their race.

In the government's first suit, filed on March 25, 2008 under Title VII of the Civil Rights Act of 1964, the EEOC alleged that the principal and manager of the facility sexually harassed a class of women employees over a period of years and refused…


President Obama’s signature on Congress’ aggressive bill to limit the number of Americans who smoke means the battle to save millions of American lives has been joined by a newly engaged federal government.

“New York City has been on the front lines of this battle for years. The City’s initially controversial smoking ban became a model for cities, states and countries across the globe. And today the federal government has adopted the truth-telling tactics we have used in anti-smoking advertisements, in which the public is shown the severe costs that smoking imposes on a person’s health and appearance. New York’s anti-smoking strategy has yielded real results. We have reduced the number of adult smokers by 300,000, prevented 100,000 premature deaths, cut teen smoking by more than half and prevented at least 24,000 additional teens from smoking.

“After years of inaction and subservience to powerful lobbyists, our leaders in Washington sent a clear message: the tobacco industry no long…



Attorney General Andrew M. Cuomo today announced that he has notified Long Island attorney Lawrence W. Reich of his intent to commence litigation for fraud and other claims as part of the Attorney General’s ongoing investigation into local government waste and abuse of the state pension system.

The Attorney General’s Office today notified Reich by letter of the office’s intent to sue him pursuant to New York Executive Law Section 63(12), among other claims, to recover compensation and benefits that Reich received from the State and six school districts to which Reich was not entitled.

The proposed litigation arises from Attorney General Cuomo’s investigation into attorneys and other professionals around the State who have improperly and fraudulently caused themselves to be on public payrolls in order to obtain State pension and other benefits.

“These cases have come to epitomize the kinds of fraud and abuse …

Multi-Million Dollar E-mail Stock Fraud Scheme

Five individuals pleaded guilty today in federal court in Detroit for their roles in a wide-ranging international stock fraud scheme involving the illegal use of bulk commercial e-mails, or "spamming."

Alan M. Ralsky, 64, of West Bloomfield, Mich., and Scott K. Bradley, 38, also of West Bloomfield, both pleaded guilty to conspiracy to commit wire fraud, mail fraud and to violate the CAN-SPAM Act. Ralsky and Bradley also pleaded guilty to wire fraud, money laundering and violating the CAN-SPAM Act. Under the terms of his plea agreement, Ralsky acknowledges he is facing up to 87 months in prison and a $1 million fine under the federal sentencing guidelines while Bradley acknowledges that he is facing up to 78 months in prison and a $1 million fine under the federal sentencing guidelines.

The CAN-SPAM Act was passed by Congress in 2003 to address spam e-mails. The criminal provisions of the Act prohibit falsification of certain information used in the transmission of e-mail.



A Molalla, Ore., nursery violated federal law when it allowed female employees to be severely sexually harassed and retaliated against the women and male co-workers after they reported the harassment, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a lawsuit it filed today. This is the agency’s third such case against Oregon agricultural employers. Last October, the EEOC filed lawsuits against Scheimer Farms of Nyassa, Ore., and against Wilcox Farms, Inc., and Wilcox Dairy Farms Group in Aurora, Ore.

The EEOC’s suit charges that sexual harassment and retaliation occurred at the Molalla, Ore., facility of Willamette Tree Wholesale, which operates 140 acres of retail nursery farmland, including a garden supply store and business office. According to the federal agency’s investigation, one worker, a 38-year-old Latina, was taken to remote areas of the farm by the company foreman and raped repeatedly over several months. In addition to threatening her with termination an…

NYS Employees Illegally Collected Unemployment Benefits While on the State’s Payroll

Attorney General Andrew M. Cuomo today announced the arrests of 30 former and current New York State employees who allegedly obtained unemployment benefits illegally while on State payroll. The individuals were arrested as part of the Attorney General’s statewide sweep over the past week, targeting abuses of the financially strapped New York State unemployment system. In New York’s current fiscal crisis, the unemployment insurance fund provides much-needed financial relief to thousands of New Yorkers who have lost their jobs.

According to complaints filed in New York, Bronx, Kings, Queens, Richmond, Suffolk, Nassau, Albany, Dutchess, Rockland and Westchester Counties over the past week, these 30 defendants stole thousands of dollars from New York State by falsely certifying that they were qualified for unemployment insurance benefits through the Department of Labor’s electronic certification process.

“New York’s unemployment insurance fund was created to help hard-working individuals wh…


The U.S. Equal Employment Opportunity Commission (EEOC) today announced a class litigation settlement under Title VII of the Civil Rights Act for one half million dollars and significant remedial relief in a case against Fire Mountain Restaurants LLC, doing business as Ryan’s Family Steakhouse (Ryan’s).

According to the EEOC’s lawsuit, filed in September 2008 in U.S. District Court for the Western District of Kentucky, Paducah Division (Civil Action No. 5:08-cv-00160-TBR), Ryan’s subjected black and female employees to a sex-based and race-based hostile work environment, as well as adverse terms and conditions of employment. In some instances, black workers were terminated because of their race. The EEOC charged that white employees were also harassed because of their association with black coworkers and family members. The mistreatment included being referred to as “n----r lovers” and “race traitors” by white managers.

The EEOC also asserted that female workers were harassed because of…

Wife of Gang Leader Pleads Guilty to Narcotics Charges

On the day her trial was to begin in U.S. District Court in Lubbock, Texas, Almighty Latin King and Queen Nation (ALKQN) member Marie Chavez, aka "Shorty," the wife of an alleged ALKQN leader Jose Nava, aka "Chino," pleaded guilty to a superseding indictment charging her and 16 co-defendants with various offenses related to alleged narcotics and weapons trafficking and violent activities.

Specifically, Chavez, 28, of Lubbock, pleaded guilty to one count of conspiracy to distribute and possession with intent to distribute five kilograms or more of cocaine and 100 kilograms or more of marijuana; and possession with intent to distribute 500 grams or more of cocaine. She faces a maximum statutory sentence of not less than 10 years and up to life in prison. A sentencing date has not yet been scheduled. Chavez has been in custody since her arrest in December 2008.

According to documents filed in court, Chavez admitted that from 2001 until the time of her arrest, she and co…

Tyson Foods Sentenced to Pay Fine for OSHA Violation That Led to Worker Death

Tyson Foods Inc. was sentenced today in U.S. District Court in Arkansas to pay the maximum fine for willfully violating worker safety regulations that led to a worker’s death in its River Valley Animal Foods (RVAF) plant in Texarkana, Ark., the Justice Department announced.

The court ordered Tyson Food to pay the $500,000, the maximum criminal fine as well as serve one year probation.

According to the court documents filed in the case, Tyson operated several RVAF plants that recycled poultry products into protein and fats for the animal food industry. As part of the rendering process in four of the plants, the company used high-pressure steam processors called hydrolyzers to convert the poultry feather into feather meal.

Decomposition of biological material such as poultry feathers produces hydrogen sulfide gas, an acute-acting toxic substance. Employees at the Tyson facilities often were exposed to the toxic gas when working on or near the hydrolyzers, which required frequent adjustment…

Chicago Police Officer Sentenced for Violating Federal Civil Rights of a Man Beaten While Restrained in a Wheelchair

William Cozzi, a Chicago police officer, was sentenced today to 40 months in federal prison for violating the federal civil rights of a man whom the officer struck repeatedly with a dangerous weapon while the man was handcuffed and shackled in a wheelchair.

Cozzi, 52, of Chicago, pleaded guilty in January and admitted that he used excessive or unreasonable force while acting under color of law. He was ordered to begin serving his sentence on Aug. 6, 2009. The sentence was imposed by U.S. District Judge Blanche Manning, who also imposed a $2,000 fine, two years of supervised release and 200 hours of community service. Cozzi joined the Chicago Police Department in 1992 and was assigned to the 25th District at the time of the alleged incident. He was subsequently suspended from duty.

Cozzi was charged in April 2008 with depriving the victim of his civil rights. In pleading guilty, Cozzi admitted that on Aug. 2, 2005, while performing his duties as a police officer, he used a "sap"…


EEOC Settles Suit Charging Male Supervisor Sexually Harassed Male Subordinates

MIAMI -- The U.S. Equal Employment Opportunity Commission (EEOC) today announced that national retail giant Dillard’s, Inc. will pay $110,000 and provide significant remedial relief to settle a same-sex harassment lawsuit involving two male victims.

According to the EEOC’s suit, under Title VII of the Civil Rights Act, Dillard’s permitted a sexually hostile work environment for men at its Fashion Square Mall store in Orlando, Fla. The EEOC charged that a male supervisor engaged in verbal and physical sexual harassment of a male sales associate and a young dockworker when the supervisor exposed himself, propositioned the men, and made sexually explicit and derogatory comments. The EEOC said that Dillard’s ignored complaints about the harasser.

Appeals Court Rejects Challenge to Conviction of Former Mississippi Klansman in 1964 Kidnapping and Murder of Two African American Men

The U.S. Court of Appeals for the Fifth Circuit today rejected a challenge to the conviction of James Ford Seale, a former member of the White Knights of the Ku Klux Klan of Mississippi.

Seale was convicted by a federal jury in Mississippi in 2007 and sentenced to three life terms in prison. The jury determined that Seale and other Klansmen conspired to abduct, interrogate, beat and eventually murder Henry Hezekiah Dee and Charlie Eddie Moore, both 19 years old at the time of their murders.

Seale appealed his convictions, arguing that a 1972 amendment to the federal kidnapping statute changed the statute of limitations to five years. In September 2008, a three-judge panel agreed with Seale, overturning his convictions. The United States successfully urged the full court to rehear the case and, in the meantime, to keep Seale in jail. Today, a divided court upheld the trial court’s decision to deny Seale’s motion to dismiss the indictment based on the statute of limitations. The appeal wi…


The U.S. Equal Employment Opportunity Commission (EEOC) today sued Chicago-based global air carrier United Airlines for discriminating against a class of employees with disabilities by failing to provide job transfers to vacant positions, despite their qualifications, as a reasonable accommodation.

Lead class member Joe Boswell worked as an airline mechanic for United at the San Francisco Airport for over a decade before being diagnosed with a brain tumor, causing him to take leave and seek medical treatment. When Boswell returned to work at United, he could not be accommodated in his position as a mechanic, so he applied for a number of vacant positions for which he was qualified.

The Americans With Disabilities Act (ADA) requires employers to provide reasonable accommodations for employees with disabilities. Under the statute, reasonable accommodations specifically include reassignment to a vacant position. However, instead of providing such an accommodation to Boswell, the EEOC say…

Department Asks Alaska Corruption Cases Be Remanded to District Court, Former State Representatives Be Released

The Department of Justice today asked the U.S. Court of Appeals for the Ninth Circuit to remand the cases of former Alaska State Representatives Victor Kohring and Peter Kott, who were convicted on corruption charges in 2007, to the District Court. The Department also asked the Court of Appeals to release the two on personal recognizance, after the Department uncovered material that appears to be information that should have been, but was not, disclosed to the defense prior to trial.

Attorney General Eric Holder also instructed the Department’s Criminal Division to review the Department’s public corruption investigation in Alaska to ensure that all other discovery obligations have been met.

"After a careful review of these cases, I have determined that it appears that the Department did not provide information that should have been disclosed to the defense," Holder said. "Department of Justice prosecutors work hard every day and perform a great service for the American pe…


U.S. Housing and Urban Development Secretary Shaun Donovan today announced HUD will speed federal disaster assistance to four storm-ravaged counties in Alabama and provide support to homeowners and low-income renters forced from their homes following last month's severe storms, flooding, tornadoes and straight-line winds.

Yesterday, President Obama issued a disaster declaration in Autauga, Bullock, Elmore, and Montgomery Counties allowing the Federal Emergency Management Agency (FEMA) to extend disaster assistance through its Public Assistance Program. The President's declaration also allows HUD to offer foreclosure relief and other assistance to certain families living these counties.


A federal grand jury in Brooklyn returned an indictment charging nine defendants with a mortgage fraud scheme that resulted in losses exceeding $90 million. The indictment alleges the defendants conspired to defraud Washington Mutual Bank (“WAMU”) and DLJ Mortgage Capital, Inc. (“DLJ”), a subsidiary of Credit Suisse, in connection with the development of two tracts of land located in Brooklyn and Queens by staging the sales of the same properties to straw buyers in order to obtain multiple mortgages on those properties. Thomas Kontogiannis, John Michael, Elias Apergis, Steven Martini, Nadia Konstantinadou, Stefan Deligiannis, Ted Doumazios, Edward Hogan, and Jonathan Rubin are charged with conspiracy to commit bank and wire fraud. In addition, Kontogiannis, Apergis, Konstantinadou, Deligiannis, Martini, and Doumazios are charged with bank fraud, and Kontogiannis and Konstantinadou are charged with money laundering and money laundering conspiracy.1

The indictment was announced by Bento…