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September 23, 2021

Shipping company Diana Wilhelmsen Management Limited was ordered to pay $2 million following its admissions that it violated the Act to Prevent Pollution from Ships.  DWM admitted that its vessel, M/V Protefs, unlawfully discharged oily bilge water and knowingly kept a false oil record book.  DOJ; USAO ED LA

September 22, 2021

Jonathan Dean Davis, the owner of the Retail Ready Career Center, a for-profit trade school, was sentenced to nearly 20 years in prison following his conviction on fraud charges.  Davis marketed his school’s HVAC training course to veterans by falsely securing certification of his program by Texas state agencies in order qualify the program to charge veterans’ tuition and fees to the Veteran’s Administration under the Veteran’s Educational Assistance Act.  In fact, Retail Ready used up veteran’s GI Bill benefits and failed to prepare them for careers while collecting more than $72 million in GI Bill benefits from the VA.  Davis was also ordered to pay $65.2 million in restitution and forfeit $72.5 million.  USAO ND TX

September 8, 2021

Bayada Home Health Care, Inc. and related entities agreed to pay $17 million to resolve allegations of paying unlawful kickbacks that were initiated by a whistleblower action under the False Claims Act.  The government alleged that Bayada purchased two home health care agencies from a company that owned retirement communities in order to induce referrals from the seller to Bayada.  The whistleblower, David Freedman, was the director of strategic growth for Bayada; he will receive more than $3 million as a whistleblower reward.  DOJ; USAO NJ

September 3, 2021

A number of South Carolina pain management clinics, drug testing laboratories and other entities associated with chiropractor Daniel McCollum have had default judgments entered against them ordering the payment of $140 million.  The defendant entities, Oaktree Medical Centre P.C., FirstChoice Healthcare P.C., Labsource LLC, Pain Management Associates entities, ProLab LLC, and ProCare Counseling Center LLC, were alleged to have provided illegal financial incentives to providers to induce their referrals of urine drug tests in violation of the Stark Law and the Anti-Kickback Statute, and to have submitted false claims to federal healthcare programs for medically unnecessary urine drug testing, steroid injections, opioid prescriptions, and lidocaine ointment prescriptions.  The settlement resolves claims against the entities brought in three separate qui tam actions Donna Rauch, Muriel Calhoun, Brandy Knight, Karen Mathewson and Tracy Hawkins, former employees of pain management clinics owned or operated by McCollum. The government continues to pursue claims against McCollum.  DOJ; USAO SC

September 2, 2021

Jonathan Dean Davis, the owner of for-profit trade school called Retail Ready Career Center, has agreed to forfeit over $72 million after being convicted of defrauding the U.S. Department of Veterans Affairs.  According to evidence presented at trial, Davis falsely certified that he was not personally facing any criminal or civil actions, and that his school was an established, financially-secure educational institution—neither of which were true.  The scheme unraveled after student veterans realized the HVAC training they received at the school was insufficient for entry-level jobs in the industry.  USAO NDTX

September 1, 2021

The Van Andel Research Institute has agreed to pay $1.1 million to resolve allegations of failing to disclose foreign ties in awards granted by the National Institutes of Health (NIH), in violation of the False Claims Act.  The foreign ties included foreign-sourced research samples and funding by the Chinese government.  In December 2019, the institute settled similar claims for $5.5 million.  With this second settlement, specific conditions have now been imposed on the remainder of the institute’s NIH grants, including a requirement that an executive-level manager personally certify to disclosures until October 2022.  USAO WDMI

August 30, 2021

Northern California healthcare provider Sutter Health and its affiliated entities will pay $90 million to resolve a False Claims Act case initially filed by whistleblower Kathy Ormsby alleging that defendants submitted unsupported diagnosis codes for patients enrolled in Medicare Advantage.  Sutter contracts with Medicare Advantage Organizations to provide care to Medicare Advantage beneficiaries enrolled in their plans, and allegedly caused those MAOs to submit to Medicare inaccurate and invalid diagnosis codes that inflated the risk scores of those beneficiaries and were not supported by the medical records, thereby resulting in overpayments by CMS.  Sutter also allegedly failed to take sufficient corrective action when it became aware of the submission of these unsupported diagnosis codes.  Sutter also entered into a five-year corporate integrity agreement.  Sutter previously entered into a partial settlement of $30 million, which will be credited against the $90 million total settlement.  DOJ; USAO ND Cal

August 27, 2021

Two securities lawyers and the former COO of commercial lending company 1 Global Capital LLC have been sentenced to prison terms ranging from 8 months to 5 years, and ordered to pay between $29 million and nearly $150 million in restitution, after pleading guilty to running a massive fraud scheme that affected more than 3,600 investors across 42 states.  In order to attract investments to 1 Global Capital, yet assuage investor concerns about whether it was selling legal securities, former COO Steven Schwartz, attorney Andrew Ledbetter, and outside counsel Jan Atlas knowingly made false and misleading representations.  In exchange for their work for 1 Global Capital, Ledbetter and Atlas received substantial commissions over the years, which they failed to disclose to the law firm they were both employed with.  USAO SDFL

August 27, 2021

John Peter Smith Hospital (JPS) in Texas has agreed to pay more than $3.3 million to resolve a qui tam suit filed by its former Director of Compliance, Erma Lee, which alleged that the hospital routinely applied billing modifiers that essentially double-billed federal healthcare programs for certain aspects of patients’ care.  Even after raising the issue internally, JPS allegedly failed to reimburse payors, prompting Lee to file the case in 2018.  For doing so, Lee will receive over $900,000 of the settlement proceeds.  USAO NDTX

August 27, 2021

Prithviraj “Roger” Bhikha, a former Senior Director of Global Supplier Management at Cisco Systems, Inc. was sentenced to three years in prison and ordered to pay $2.5 million to the IRS following his guilty plea on charges arising from his receipt of kickbacks from Cisco vendors, his creation of a front company that billed $10 million in services to Cisco while concealing his role, and his failure to report more than $9 million in income to the IRS.  Bhikha was also ordered to pay $1.15 million to Cisco, and forfeited to pieces of real estate in San Francisco.  IRS; USAO ND Cal
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