Government Enforcement Actions

May 28, 2014

Medical device manufacturer Medtronic Inc. agreed to pay $9.9M to resolve allegations under the False Claims Act that the company used various types of illegal kickbacks to induce physicians to use pacemakers and defibrillators made and sold by Medtronic. Among the the illegal inducements the government charged Medtronic with using were: 1) paying implanting physicians to speak at events intended to increase the flow of referral business; 2) developing marketing/business development plans for physicians at no cost; and 3) providing tickets to sporting events. The settlement stems from a whistleblower complaint filed by former Medtronic employee Adolfo Schroeder under the qui tam provisions of the False Claims Act. He will receive a whistleblower reward of approximately $1.73M. DOJ  

May 22, 2014

The CFTC obtained an Order against four Hunter Wise related companies and their owners on charges they had fraudulently misrepresented the nature of precious metals transactions that resulted in millions of dollars in customer losses.  Hunter Wise Commodities, Hunter Wise Services, Hunter Wise Credit and Hunter Wise Trading and the individuals running the companies, Fred Jager and Harold Edward Martin, have been ordered to pay $52.6M in restitution to the defrauded customers and to pay a civil penalty of $55.4M.  The Order found that Jager and Martin knowingly defrauded more than 3,200 retail customers for more than 16 months in a manner that was “repeated, callous and blatant.”  CFTC

May 21, 2014

The CFTC obtained an emergency court Order freezing and preserving the assets under the control of Cindy and Paul Vandivier and their company, Mintline, Inc., all of Florida.  The Order stems from a CFTC enforcement action charging the Vandiviers and Mintline with fraudulently soliciting customers and misappropriating customer funds in connection with illegal, off-exchange transactions in precious metals from July 2011 to at least April 2013.  CFTC

May 19, 2014

The CFTC issued an Order filing and simultaneously settling charges that Global Futures & Forex, Ltd., a CFTC-registered Futures Commission Merchant (FCM) and former Retail Foreign Exchange Dealer (RFED) headquartered in Grand Rapids, Michigan, failed to comply with minimum financial requirements for FCMs and RFEDs. The CFTC Order imposes a $200,000 civil penalty and a cease and desist order against GFF for its violations.  CFTC

May 15, 2014

The CFTC issued an Order against RP Martin Holdings Limited, and its subsidiary, Martin Brokers (UK) Limited, an interdealer broker, filing and settling charges of manipulation, attempted manipulation, false reporting, and aiding and abetting derivatives traders’ acts of manipulation and attempted manipulation of the London Interbank Offered Rate (LIBOR) for Yen.  The CFTC Order requires RP Martin to pay a $1.2M civil penalty.  CFTC

May 2, 2014

The CFTC obtained a restraining order freezing assets and prohibiting the destruction or concealment of books and records of EJS Capital Management, Alex Vladimir Ekdeshman and Edward J. Servider.  The order arises out of a Complaint the CFTC filed charging them with fraudulent solicitation of more than $2M, misappropriation of most of those funds, issuing false account statements, and registration violations in an ongoing retail foreign currency (forex) fraud scheme.  CFTC

April 29, 2014

The CFTC obtained a final judgment and consent Order against Illinois resident James C. Yadgir settling charges that Yadgir exceeded speculative position limits in live cattle futures contracts and feeder cattle futures contracts. The Order requires Yadgir to pay a civil penalty of $130,000.  CFTC

April 28, 2014

The CFTC obtained a Consent Order against Tunney & Associates, P.C, an accounting firm with offices in Hammond, Indiana and Orland Park, Illinois, and Michael Tunney, its sole owner and a certified public accountant, requiring T&A and Tunney jointly to pay a $100,000 civil penalty for violating CFTC Regulations when conducting audits for The Linn Group, a CFTC-registered Futures Commission Merchant.  CFTC

April 25, 2014

The CFTC obtained a Consent Order of Permanent Injunction that bars Australian firm Halifax Investment Services, Ltd. from soliciting orders to trade foreign currency (forex) from US residents who do not qualify as eligible contract participants (ECPs) and from offering to be the counterparty to US residents’ forex transactions without registering with the CFTC.  The Order settles CFTC charges that Halifax unlawfully solicited members of the public to engage in forex transactions and operated as a Retail Foreign Exchange Dealer (RFED) without being registered with the CFTC.  CFTC

April 23, 2014

Amedisys home health companies agreed to pay $150M resolve allegations they violated the False Claims Act by allegedly billing Medicare for nursing and therapy services not medically necessary or provided to patients who were not homebound, and by otherwise misrepresenting patients’ conditions to increase its Medicare payments. The allegations were first raised in several qui tam lawsuit filed by former Amedisys employees under the whistleblower provisions of the False Claims Act. DOJ