Category Archives: Federal Crimes

Alabama Pain Management Clinics Under the Microscope

It has become apparent that the national push to prosecute pain management physicians under the Federal criminal drug statutes is making its way into Alabama. With the recent proliferation of heroin deaths in Alabama, it is believed that federal law enforcement within the state are looking to crack down on “pill mills” which distribute prescription pain medicine believed to be a sort of gateway drug to heroin.

Prosecutors have made it known that they are interested in speaking with drug addicts who have been arrested for unlawful possession in an attempt to make a case against doctors that are over-prescribing pain medication. It is also believed that the DEA is reviewing prescription statistics to determine which doctors are prescribing pain medication at the highest rates.

If the prosecution makes the decision that the prescriptions are being written outside the usual course of professional practice and other than for a legitimate medical purpose, charges can be brought. The question becomes, on a case-by-case basis, who is a prosecutor that is a non-physician to say what is or is not medically necessary. This will be the issue for the jury in these cases.

These prosecutions will be high-stakes and will target prominent members of the community in Birmingham and other Alabama cities. Similar cases have made national news with pain management doctors receiving sentences of up to 20 years for federal drug conspiracy, unlawful distribution of a controlled substance, and money laundering. The money laundering allegations are typically brought in to show the doctors had a profit motive for prescribing large amounts of narcotics and used the money to purchase nice cars, homes and jewelry.

Some doctors are claiming that such prosecutions could have a chilling effect on how they treat their patients, while other doctors believe these “pill mills” give the profession a bad name. In any event, we will be hearing much more about these cases in the coming months.

Super Bowl Scam

Three Atlanta men have been indicted for trafficking in counterfeit Super Bowl XLVII tickets following a January 31st traffic stop in Sumter County. Two of the three were also charged with possessing and concealing counterfeit U.S. currency after fake money was discovered along with 57 counterfeited tickets. On top of the substantive counts of trafficking and possessing/concealing, the three defendants face a count of conspiring to transport and sell the counterfeit tickets. 

U.S. Immigration and Customs Enforcement’s Homeland Security Investigations investigated the case. If convicted, the men could face substantial federal prison sentences for their roles in the conspiracy. While most people think of the Homeland Security Investigations division as dealing exclusively in counter terrorism  this case highlights the broad scope of their investigations. Over $7000 in counterfeit bills were seized as a result of the traffic stop. 

Since the three men were found in possession of the counterfeit tickets and currency, a conspiracy count was also charged. Conspiracy is a separate and distinct crime, which carries additional sentencing. In order to prove a conspiracy count, the government must show that the defendant conspired with others to commit the underlying offense (in this case, trafficking counterfeit tickets), which entails the showing of an agreement to commit the crime. The conspiracy charge is a favorite among federal prosecutors in going to trial, and can be very tricky to defend. 

If you or someone you know has been charged with conspiracy, federal drug charges or weapon charges, or any criminal offense, obtaining the best legal representation possible is the key to securing your freedom. The white collar criminal attorneys at Parkman White, LLP have years of experience in state and federal courts, and boast an impressive track record of acquittals over the years. Our attorneys possess the required legal expertise and trial advocacy skills required to do battle with the vast legal and investigative resources of the federal government in court. Call us today at 205-502-2000 for a consultation and let us put our experience to work for you.

 

Rich Couple Imprisoned for Federal Welfare Fraud

A couple with a lakeside home in an affluent Seattle neighborhood will be locked behind bars for 18 months because of welfare fraud charges.

On Friday a federal judge sentenced David Mark Silverstein, 60, and his partner Lyudmila Shimonova, 53, to federal prison for making false statements in order to receive federal assistance.

Silverstein has already paid $206,970 in fines and penalties as well as $160,000 in restitution in a related civil case that the US Government filed against him. After this criminal sentence he will also have to pay an extra $30,000 and remain under federal supervision for three years after being released from prison.

Similarly, Shimonova was fined more than $261,000 in restitution and faces three years of supervised release.

Federal prosecutors ensured a particularly long sentence for the couple by pointing out that the couple was already enjoying a relatively affluent lifestyle without the government aid. Prosecuting attorney C. Seth Wilkinson told the court that “The defendants committed these crimes out of greed, not need.” Most persons who welfare fraud are relatively impoverished and use the money to make themselves slightly more comfortable. Silversteen and Shimonova on the other hand enjoyed a life of luxury. They owned a lakefront home, with a boat. Silversteen drove a jaguar and Shimonova owned jewelry worth in excess of $60,000.

Investigators argued that Shimonova received more than $100,000 in federal housing assistance, which was paid to Silverstein, who was listed as her landlord. She also received much more assistance from other programs for needy families. Although Shimonova had no children and shared income with Silverstain, the couple reported that she was a single mother of two and struggling to make ends meet.

Silverstein’s attorney said that the criminal charges have cost Silverstein dearly. Silverstein has been shunned by his friends and was forced to close his business. This illustrates that the social repercussion of criminal charges such as fraud can be far worse than any punishment imposed by the court.

IRS Awards $104 Million to Whistleblower In Hopes of Spurring More Informants

Earlier this month the IRS awarded $104 Million to Bradley Birkenfield for revealing tax fraud committed by UBS bank.

Birkenfield was a former employee of the famous Swiss Bank. The bank came under scrutiny by the IRS in 2009 when it was charged with helping wealthy Americans hide their assets in bank accounts to evade tax liability. Because of Birkenfield and the IRS’ investigation UBS agreed to pay the IRS $780 million in fines, penalties, interest and restitution in exchange for an agreement to defer prosecution of the charges.

Although Birkenfield revealed many of UBS’ secrets, he was also charged and convicted of unlawfully withholding other information. As a result Birkenfield spent 30 months in prison, and was not able to collect his reward money until he was released earlier this month.

By the time Birkenfield received his money from the IRS, the actual amount he owned declined dramatically considering the costs of his own legal battle with the IRS and accompanying fines and penalties. Nevertheless Birkenfield definetly came out ahead, he reaped nearly $44 million after these expenses.

Birkenfield’s reward was the highest reward ever received by a single individual. Some legal experts believe that because of Birken’s high reward more informants will likely come forward in the hopes that they can also cash in on calling out fraud.

Nevertheless, the IRS is by far the biggest winner in this story, because of Birkenfield’s information the IRS was able to collect roughly $5 billion in taxes from banks and wealthy individuals.

Although Birkenfield was released from prison he is currently under home surveillance, and living in a friend’s estate in New Hampshire.

Another former Madoff employee expected to plead guilty

Today when anyone hears “Ponzi scheme” they think Bernie Madoff. And for good reason, too. Madoff is responsible for the biggest Ponzi scheme in history and had claimed that he worked alone to create the ill-fated ‘business plan’ that is estimated to have caused losses of around $17.3 billion.

Some of the charges that were brought against Madoff in 2008 included securities fraud, wire fraud, mail fraud, money laundering, perjury, theft from employee benefit plans and making false filings with the SEC. March 12, 2009, Madoff pleaded guilty to 11 federal felonies. and was sentenced to 150 years in federal prison on June 29, 2009.

Although Madoff still claims he acted alone, eight people have pled guilty to some degree of involvement in unethical practices involving Madoff and his businesses, including:

  • David G. Friehling pled guilty to charges of securities fraud, investment adviser fraud and filing false audit reports with the SEC on November 3, 2009.
  • Peter Madoff, Bernie’s brother, although denying he knew of the actual scheme itself, pled guilty to numerous charges, including failing to pay taxes on millions of dollars of income, submitting false filings to securities regulators and putting non-working family members on the payroll.
  • Frank DiPascali pled guilty to 10 counts including conspiracy, investment advisory fraud, mail fraud, perjury and international money laundering on August 11, 2009.
  • Eric Lipkin pleaded guilty to six criminal counts including falsifying documents, putting non-working people on the payroll in August 2011.

Now Irvin Lipkin, Eric Lipkin’s father, will soon be added to that list as he is expected to plead guilty to charges of falsifying documents, falsely paying people for 401(k) and retirement benefits and conspiracy to commit securities fraud. The elder Lipkin started working for Bernie Madoff in 1964 and was still paid by Madoff for many years even after retiring in 1999.

In 1998, Lipkin referred to Madoff as “the brother I never had,” a testament to how close the two had been, both professionally and otherwise. Lipkin could get jail time up to 10 years for his involvements in the Madoff mess.

Huntsville Man Charged With Fraud

The men and women in the military risk their lives daily protecting not only the  lives and liberty of Americans, but many others around the world.  When we see a service member in military uniform, especially one who has earned medals for bravery beyond the call of duty, we feel pride at their accomplishment and respect their sacrifice for our freedoms.  Unfortunately there are those who have not served in the military who do not have the right or authority to wear military uniforms, badges, decorations and medals, but do so anyway to garner the respect and honor they do not deserve.

Joyce White Vance, U.S. Attorney, and Robert Haley III, FBI Agent in Charge, announced that a  federal grand jury in Birmingham indicted a Huntsville man yesterday for fraud and unauthorized wearing of U.S. military uniforms and medals.  The indictment filed charges Christopher Bernard Graham with one count of fraud in relation to identification documents, two counts of unauthorized wearing of the U.S. Army Combat Uniform and eight counts of unauthorized wearing of U.S. military badges, decorations or medals.

The fraud charge was for the identification card Graham had in his possession that was illegally produced to appear as though it was an actual military ID issued under the authority of the United States.  Graham wore the Army Combat uniform between October 2010 and April 2011, and then again from November 2011 and April 2012.  During these same time frames, the defendant also wore the Combat Infantry Badge, the Army Ranger Tab, the Army Parachute Qualification Badge and the Army Air Assault Qualification Badge, according to the indictment.

If convicted of the fraud charge, which is a felony, Graham could spend up to fifteen years in prison and be fined up to $250,000.  The other charges of wearing an unauthorized uniform or military badges, decorations and medals are misdemeanors, and the maximum penalties for these crimes are six months in prison and $5,000 in fines.

‘Queen of the Pacific’ Facing Federal Drug Charges

Every now and then, a woman rises to the top of the drug dealer chain. It’s a rare occurrence in the male-dominated business, but Sandra Avila Betran had risen to the top.

The 51-year-old woman, who had a ballad written for her by a band called Los Tucanes de Tijuana, is set to appear in federal court in Miami for her arraignment and bond hearing. She had been extradited from Mexico where she had been arrested in 2007 on charges of conspiring to smuggle loads of cocaine into the United States more than a decade ago.

“She is very Cleopatra-ish, like the Queen of the Nile,” said Miami criminal defense attorney Lilly Ann Sanchez, who represented two other defendants in the same case. “She was able to maneuver her way in a man’s world and use the fact that she was a woman to her advantage in more ways than one.”

She earned her ‘Queen of the Pacific’ status through her romantic relationship with a Colombian drug kingpin and her influence over the supply routes of the Pacific ocean.

Her extradition to the U.S. was granted by the Mexican court system to face trafficking charges. More than ten years ago federal agents intercepted a phone call in which Avila allegedly was seeking payment for some 220 pounds of cocaine that was being delivered in Chicago.

Her defense attorney maintains that Avila is innocent.

“Throughout the entirety of the prosecution’s investigation, Sandra has maintained she was not involved in any of the allegations against her in the indictment,” said her attorney, Stephen Ralls, of Tucson, who has represented many major accused traffickers.

See full story here.

Bribing Corporation Makes Plea Agreement with Federal Prosecutors: Fines Total $8.82 Million

A power plant maintenance company, Data Systems & Solutions LLC, has agreed to pay $8.82 million in criminal penalties to resolve multiple violations of the Foreign Corrupt Practices Act (FCPA).

The Department of Justice (DOJ) filed a two count indictment in the Eastern District of Virginia charging DS&S with conspiring to violate and violating the FCPA’s ban on bribing foreign officials.

According to the criminal complaint the DOJ alleged that DS&S gave bribes to employees of the Ignalia Nuclear Power Plant, a state operated power plant in Lithuania, in order to receive contracts for DS&S to perform services at the plant. DS&S funneled bribes though subcontractors in the US and abroad in order to cover up the scheme. The subcontractors then made repeated payments to the government sponsored officials via check or wire transfer.

The DOJ filed a deferred prosecution agreement with DS&S. In this agreement the prosecution will be put off for two years. During this time DS&S make a full payment of the $8.82 million and DS&S must cooperate with DOJ as well as report periodically to the DOJ regarding compliance efforts with the Foreign Corrupt Practices Act. IF DS&S complies with the agreement the DOJ will dismiss the criminal charges against DS&S.

DS&S has played a cooperative role in this processs. The company helped to launch an investigation with the DOJ and also held the agents responsible for the bribes responsible by terminating them. DS&S has also improved its policies for ensuring subcontracts act ethically, and has beefed up its own ethics guidebook.

Florida Police Officer Convicted of Aiding Tax Fraud Scheme

Florida police officer Dana Brown was sentenced to more than six years in federal prison for using the state’s driving license database to assist in fraud.

Brown provided the information from the state database to an accomplice who produced fake IDs in order to cash US Treasury checks.

Federal investigators say that more than 195 persons lost money due to the former officer’s crimes.

In the sentencing hearing Brown apologized and explained to the court that he had violated the public trust and sold his soul.

Federal judge Mary Scriven sentenced Brown to 77 months in prison and ordered Brown to repay the amount of the checks he helped to convert. The total amount of restitution came to $874,319.

Brown’s sentencing came after a co-consiprator, Riad Sulaiman, had been sentenced for obtaining the fraudulent tax return filings by purchasing them through his business.

Sulaiman used Brown to search the names on the fraudulent tax returns through the Florida DMV database. With this information Sulaiman created fake IDs to cash the checks.

Sulaiman was sentenced for one year less than Brown. According to prosecutors this was because Sulaiman cooperated with investigators and there were a fewer number of checks associated with him.

Brown’s attorney argued that his client should not face a stricter sentence than his co-conspirator because Brown formerly served in the US Army and faithfully served the public until the time he engaged in fraud. However, the court did not find that argument persuasive.

Brown has the right to appeal his sentence within 14 days. Brown’s attorney would not comment on whether this was likely to happen.

Hoover Man and Birmingham Tax Preparer Indicted on Tax Fraud Charges

Whether it is the state of the economy or just a lowering of standards, there seems to be more cases of people trying to defraud the government.

In one such case a couple was  indicted in federal court for attempting to defraud the government.  A Birmingham tax preparer and a Hoover man were  indicted on tax fraud charges.

Jose Dilberto Gonzalez, 41, of Hoover, and his tax-preparer, Sally Elizabeth Wynn, 64, of Birmingham, tried to dupe the government through tax fraud.  According to a statement from U.S. attorney Joyce White Vance and Internal Revenue Service Special Agent in Charge Rodney E. Clarke, the two were each indicted on three counts of tax fraud.

Filed in U.S. District Court in Birmingham, the indictment charges that Gonzalez filed false personal income tax returns for years 2005, 2006 and 2007.  As his tax-preparer, Wynn aided Gonzalez in filing these false claims.  Officials say that Gonzalez earned more than a million dollars during this time period, but he reported an income of only $180,000.

As working residents of the United States, we are legally responsible for filling out a tax return every year to determine the amount of tax we owe to the government.  An individual commits tax fraud if he intentionally violates his legal duty to file income tax returns and/or falsifies the return to reduce the amount of taxes owed.

Some of the ways one can break the tax law and commit tax fraud include:

  • Claiming false deductions
  • Concealing or transferring assets or income
  • Knowingly changing your name
  • Over reporting the amount of deductions
  • Possessing two sets of books
  • Recording personal expenses as business expenses
  • Using false amounts in the books and records

If you are being investigated or charged with tax fraud, it is important to seek legal protection.  Tax fraud can result in prison time, massive fines, and years of scrutiny by the IRS.