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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.

				

			

			
						
					
			

	
		
		

			

				
				
January 18, 2018

				 UK-based financial services company HSBC Holdings plc agreed to pay a $63.1 million criminal penalty and $38.4 million in disgorgement and restitution, for a total payout of roughly $100 million, to resolve charges that it engaged in a scheme to defraud two bank clients through a multi-million dollar scheme commonly referred to as “front-running.” DOJ				 					 

						
Tagged in:
													  Financial Institution Fraud, 
													  Market Manipulation and Trading Violations, 
													  Securities Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
January 18, 2018

				 Detroit-area doctor Gerald Daneshvar was sentenced to 24 months in prison for his role in a $1.7 million health care fraud scheme that involved billing Medicare for physician home visits that were medically unnecessary and/or were billed under unwarranted treatment codes that resulted in inappropriately high payments. DOJ				 					 

						
Tagged in:
													  Healthcare Fraud, 
													  Lack of Medical Necessity, 
													  Medical Billing Fraud, 
													  Provider Fraud, 
													  Upcoding, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
January 16, 2018

				 Virginia-based home furnishings company Bassett Mirror Company agreed to pay $10.5 million to resolve allegations it violated the False Claims Act by knowingly making false statements on customs declarations to avoid paying antidumping duties on wooden bedroom furniture imported from China. According to the government, Bassett Mirror evaded antidumping duties owed on wooden bedroom furniture imported from China by misclassifying the furniture as non-bedroom furniture which at the time of the alleged conduct was not subject to an antidumping duty. The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by Kelly Wells, an Alabama merchant who sells furniture on line. Ms. Wells will receive a whistleblower award of roughly $1.9 million from the proceeds of the government's recovery. DOJ				 					 

						
Tagged in:
													  Customs Fraud, 
													  FCA Federal, 
													  Whistleblower Case, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
January 11, 2018

				 Textile importer American Dawn, Inc. and its executives Habib Rawjee, Mahmud Rawjee, and Adnan Rawjee, agreed to pay roughly $2.3 million to resolve allegations of violating the False Claims Act by intentionally misclassifying certain textiles such as bath and shop towels imported into the United States in order to pay lower tariff rates. The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by a former employee of American Dawn. The whistleblower will receive an award of roughly $400,000 from the proceeds of the government's recovery. DOJ (NDGA)				 					 

						
Tagged in:
													  Customs Fraud, 
													  FCA Federal, 
													  Whistleblower Case, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
January 10, 2018

				 Dental management company Benevis LLC (formerly known as NCDR LLC), and more than 130 of its affiliated Kool Smiles dental clinics for which Benevis provides business management and administrative services, agreed to pay $23.9 million to settle allegations of violating the False Claims Act by submitting false claims for payment to state Medicaid programs for medically unnecessary dental services performed on children insured by Medicaid.  According to the government, Benevis and Kool Smiles clinics located throughout 17 states submitted false claims to state Medicaid programs for medically unnecessary pulpotomies (baby root canals), tooth extractions, and stainless steel crowns, in addition to seeking payment for pulpotomies that were never performed.  The government further alleged that Kool Smiles clinics routinely pressured and incentivized dentists to meet production goals through a system that disciplined “unproductive” dentists and awarded “productive” dentists with substantial cash bonuses based on the revenue generated by the procedures they performed.  The allegations originated in five whistleblower lawsuits filed under the qui tam provisions of the False Claims Act.  Three of the whistleblowers -- former Kool Smiles employees Adam Abendano, Poonam Rai, and Robin Fitzgerald -- will receive a whistleblower award of more than $2.4 million from the proceeds of the government's recovery. DOJ				 					 

						
Tagged in:
													  FCA Federal, 
													  FCA State, 
													  Medicaid, 
													  Provider Fraud, 
													  Whistleblower Case, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
January 10, 2018

				 Kentucky moving companies Lynn  Moving and Storage, Inc., Shadowens Moving and Storage Company, Inc., and E-Town Moving and storage, Inc., along with their individual owners, agreed to pay roughly $265,000 for violating the False Claims Act by systematically overbilling the United States Army for shipping costs associated with deploying and/or relocating United States Service personnel.  According to the government, the companies caused false, inflated weight tickets to be created to increase the weight of the shipments and the amount of payment to the companies by the military. DOJ (WDKY)				 					 

						
Tagged in:
													  Defense Contract Fraud, 
													  Falsifying Invoices, 
													  FCA Federal, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
January 10, 2018

				 Florida pharmacy Healthy Meds Pharmacy Corp. agreed to pay $350,000 to settle allegations under the False Claims Act for filling prescriptions in violation of TRICARE’s policy on telemedicine.  According to the government, Healthy Meds engaged in unsolicited calls to TRICARE beneficiaries, provided medically unnecessary compound medications to beneficiaries, and knowingly filled prescriptions from doctors who did not meet or properly consult with TRICARE beneficiaries. DOJ (SDFL)				 					 

						
Tagged in:
													  Compounding Pharmacy Fraud, 
													  FCA Federal, 
													  Lack of Medical Necessity, 
													  Other Government Health Programs, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
January 5, 2018

				 Michael Gluck, the former CFO Texas-based medical device company ArthroCare Corporation, was sentenced to 50 months in prison and to pay fines and forfeitures of more than $700,000 for his role in orchestrating a fraud scheme that resulted in shareholder losses of over $750 million. DOJ				 					 

						
Tagged in:
													  Securities Fraud, 
												
						

					
	
							
	
		
		
	


 			


 			




	
		
		

			

				
				
December 29, 2017

				 Maryland physician Nwaehihie H. Onyeaghala of Krystal Medical Associates, LLC agreed to pay $1 million to settle allegations he violated the False Claims Act by submitting false claims to Medicare for medically unnecessary autonomic nervous function tests and peripheral vascular tests.  According to the government, the tests were not medically necessary because Dr. Onyeaghala lacked the necessary equipment to conduct the tests, the patients did not have an autonomic nervous function disorder before the test was conducted, Dr. Onyeaghala lacked the specific training to conduct such tests and he only used the tests to monitor patient symptoms, not make any clinical decisions about future patient care.  DOJ (DMD)				 					 

						
Tagged in:
													  FCA Federal, 
													  Healthcare Fraud, 
													  Improper Medical Personnel, 
													  Lack of Medical Necessity, 
													  Medical Billing Fraud, 
													  Provider Fraud, 
												
						

					
	
							
	
		
		
	


 			


											

						

								

									
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