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DOJ Enforcement Actions

The Department of Justice is the principal federal agency authorized to enforce the laws and defend the interests of the United States. As such, it oversees the enforcement of the False Claims Act, the foundation of the American whistleblower system, as well as numerous other laws.

The agency traces its origins to the Judiciary Act of 1789 which created the Office of the Attorney General, and the 1870 Act to Establish the Department of Justice, which established the agency as “an executive department of the government of the United States” with the Attorney General as its head.

The agency is comprised of numerous divisions with the Civil Division and in some instances, the Criminal Division, overseeing investigations and prosecutions under the False Claims Act. The U.S. Attorneys Office of the federal district where the False Claims Act case is filed also plays a key role in False Claims Act enforcement.

Below are summaries of recent DOJ settlements or successful resolutions under the False Claims Act as well as other successful prosecutions for fraud and misconduct. If you believe you have information about fraud which could give  rise to a claim for a whistleblower reward, please contact us to speak with one of our experienced whistleblower attorneys.

February 26, 2021

United Airlines will pay a total of $49 million to resolve criminal and civil claims that its cargo division fraudulently overcharged the U.S. Postal Service under International Commercial Air (ICAIR) contracts by which United transported U.S. mail internationally.  While the contracts required United to bill the government based on the delivery of mail receptacles, as supported by departure and arrival scans of the receptacles, United submitted false data that was not based on actual scans or the movement of mail, and United employees who knew about the false data and billings took steps to conceal this information.  To resolve the criminal claims, United will pay $17.3 million in penalties and enter into a non-prosecution agreement including specific compliance and reporting requirements; to resolve civil claims under the False Claims Act, United will pay $32.2 million.  DOJ

February 25, 2021

Texas Center for Orthopedic and Spinal Disorders and its owner, osteopath Mark Kuper, have agreed to a judgment of $11.2 million to resolve claims arising from their fraudulent billing of government healthcare programs.  Kuper also pleaded guilty to healthcare fraud, and was sentenced to 10 years in prison.  Defendants admitted that they submitted claims for services that were never rendered, including claims for one-on-one physical therapy pursuant to an individualized plan of care, when patients were actually attending group sessions with an athletic trainer, and claims for 60-minute psychotherapy sessions when patients actually spoke with unqualified individuals for just 15-20 minutes.  In addition, Kuper permitted his wife to use his credentials to issue prescriptions for controlled substances.  The civil investigation was initiated by a qui tam complaint filed by Richard Brown, who will receive 17% of the government’s recovery.  USAO ND TX

February 24, 2021

William Taylor, the former chief operating officer of publicly-traded biopharmaceutical company MiMedx Group, Inc., was sentenced to one year in prison and ordered to pay a fine or $250,000 following his jury trial conviction on charges arising from accounting fraud.  The government presented evidence at trial that Taylor authorized the false recognition of revenue upon the shipment of MiMedx products to distributors despite knowing that the GAAP criteria for such revenue recognition had not been met.  Instead, MiMedx had promised the distributors that they could return the product or did not need to pay for it, in some cases knowing that the distributors were unable to pay for the product.  As a result, MiMedx reported materially inflated revenue in 2015.  USAO SDNY

February 24, 2021

Florida man David John Ridling was sentenced to 15 years in prison following his guilty plea on charges that he defrauded five financial institutions, securing over $40 million in loan proceeds and lines of credit, some of which he used to pay amounts to earlier victims.  Ridling, who owned and ran a farm, used fabricated and forged brokerage account statements, financial statements, and tax returns, and impersonated brokerage company personnel to misrepresent his financial condition.  USAO MD FL

February 24, 2021

Leroy King, the former chief of Antigua’s Financial Services Regulatory Commission, was sentenced to 10 years in prison for his role in obstructing the SEC’s investigation into the $7 billion Ponzi scheme perpetrated by R. Allen Stanford and the Stanford International Bank.  Stanford provided King with cash and luxury gifts, and in exchange King improperly denied his agency’s assistance to the SEC.  DOJ

February 23, 2021

Chicken producer Pilgrim’s Pride Corporation has pleaded guilty to criminal antitrust violations and agreed to pay a fine of $107 million.  According to the plea agreement, Pilgrim’s participated in a conspiracy to fix prices and rig bids for broiler chicken products and thereby suppress and eliminate competition. DOJ

February 19, 2020

Information Innovators Inc. (Triple I), a federal technology contractor in Virginia, has agreed to pay over $6 million to settle claims that a predecessor company knowingly overbilled the Department of Homeland Security (DHS) on an Enterprise Acquisition Gateway for Leading Edge Solutions Contract (EAGLE contract) from 2007 to 2014.  The alleged False Claims Act violations by Creative Computing Solutions Inc. (CCSi) involved billing DHS for work performed by under-qualified CCSi employees at rates reserved for more qualified employees.  DOJ; USAO MD

February 19, 2020

Antonio Olivera, a hospice administrator in Southern California, has been sentenced to 2.5 years in prison and ordered to pay nearly $2.2 million in restitution for his role in a multimillion dollar fraud scheme that ran from 2011 to 2018.  Together with three co-conspirators, Olivera paid illegal kickbacks to patient recruiters for referrals of Medicare beneficiaries to the hospice, Mhiramarc Management LLC.  When Mhiramarc staffers realized the referrals did not qualify for hospice, Olivera overruled them and caused the referrals to be put on hospice, ultimately causing Medicare to pay over $17 million in false claims.  DOJ

February 17, 2021

French contractor COLAS Djibouti SARL will pay a total of $14.5 million to resolve claims that it supplied substandard concrete under a contract with the U.S. Navy for construction of Navy airfields in the Republic of Djibouti.  Colas Djibouti was required to certify that concrete supplied met contractual specifications for composition and characteristics, but made fraudulent misrepresentations and created fictitious testing results regarding the concrete’s composition and characteristics.  Defendant entered into a deferred prosecution agreement on criminal claims, paying $12.5 million ($10 million in forfeiture and restitution, and $2.5 million as a criminal penalty).  Defendant also entered into a civil settlement for  $3.9 million, receiving a credit of $1.96 million for its payment under the DPA.  DOJ; USAO SD Cal

February 16, 2021

Nigerian national Obinwanne Okeke was sentenced to ten years in prison on charges arising from his role in a computer-based fraud scheme that caused an estimated $11 million in losses.  Okeke’s fraud included unauthorized access via email compromise to the computer systems of a division Caterpillar, from which defendant directed fraudulent wire transfers supported by fake invoices.  USAO ED VA
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