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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.

				

			

			
						
					
			

	
		
		

			

				
				
March 2, 2016

				 Louis Brothers, former president and CEO of Valley Forge Composite Technologies, was sentenced to 93 months in prison and to pay $1.1 million for illegally exporting sophisticated technology equipment to China.  DOJ				 					 

						
Tagged in:
													  Trade Agreements, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 2, 2016

				 Mark T. Conklin, the former owner and operator of Florida-based Recovery Home Care Inc. and Recovery Home Care Services Inc. (RHC) agreed to pay $1.75 million to resolve charges of violating the False Claims Act by paying illegal kickbacks to doctors who agreed to refer Medicare patients to RHC for home health care services.  Conklin sold RHC to National Home Care Holdings in October 2012.   According to the government, Conklin ran a scheme under which RHC paid dozens of physicians thousands of dollars per month to serve as sham medical directors who performed little or no work in exchange for referring their patients to RHC.  The allegations originated in a whistleblower lawsuit filed by former RHC employee Gregory Simony under the qui tam provisions of the False Claims Act.  He will receive a whistleblower award of up to $315,000 from the proceeds of the government's recovery.  DOJ				 					 

						
Tagged in:
													  Anti-Kickback and Stark, 
													  FCA Federal, 
													  Healthcare Fraud, 
													  Home Health and Hospice, 
													  Medicare, 
													  Whistleblower Case, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 1, 2016

				 Ubert Guillermo Rodriguez, president and owner of Florida-based durable equipment provider G.R. Services Equipment & Supplies Inc., pleaded guilty to conspiracy to commit health care fraud.  According to the government, Rodriguez’s company submitted approximately $2.6 million worth of claims to Medicare seeking reimbursement for durable medical equipment, such as wound care supplies, that was not legitimately prescribed by doctors and was not provided to beneficiaries.  DOJ				 					 

						
Tagged in:
													  Healthcare Fraud, 
													  Lack of Medical Necessity, 
													  Medical Devices and DME, 
													  Medicare, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 1, 2016

				 Olympus Corp. of America, the country’s largest distributor of endoscopes and related equipment, agreed to pay $623.2 million to resolve alleged violations of the False Claims Act and Anti-Kickback Statute through a scheme to pay kickbacks to doctors and hospitals.  It is the largest payout ever by a medical device company for violations of the Anti-Kickback Statute.  In addition, Olympus subsidiary Olympus Latin America Inc. also agreed to pay $22.8 million to resolve separate charges relating to violations of the Foreign Corrupt Practices Act.  The allegations originated in a whistleblower lawsuit filed by John Slowik, Olympus’ former chief compliance officer, under the qui tam provisions of the federal and various state False Claims Acts.  He will receive a whistleblower award of roughly $51 million from the proceeds of the government’s recovery.  Whistleblower Insider				 					 

						
Tagged in:
													  Anti-Kickback and Stark, 
													  FCA Federal, 
													  FCPA, 
													  Medical Devices and DME, 
													  Whistleblower Case, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 1, 2016

				 Connecticut-based construction company URS Corporation agreed to pay $580,000 to resolve allegations it violated the False Claims Act by overbilling the government on a bridge reconstruction project funded by the National Railroad Passenger Corporation (Amtrak).  It allegedly did so by charging the maximum labor rates listed on the contract rather than the actual labor rates.  DOJ (CT)				 					 

						
Tagged in:
													  Falsifying Invoices, 
													  FCA Federal, 
													  Government Procurement Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 29, 2016

				 Lockheed Martin Corporation (and subsidiaries Lockheed Martin Energy Systems and Lockheed Martin Utility Services) agreed to pay $5 million to resolve allegations they violated the Resource Conservation and Recovery Act (RCRA) and the False Claims Act by knowingly submitting false claims for payment under their contracts with the Department of Energy to operate the Paducah Gaseous Diffusion Plant in Kentucky.  According to the government, Lockheed Martin violated the RCRA, which establishes how hazardous wastes must be managed, by failing to identify and report hazardous waste produced and stored at the facility, and failing to properly handle and dispose of the waste.  The government alleged that this conduct resulted in false claims for payment under Lockheed Martin’s contracts with the Department of Energy.  The allegations originated in two whistleblower lawsuits filed under the qui tam provision of the False Claims Act by the Natural Resources Defense Council and several former employees of Lockheed Martin who worked at the Paducah facility.  The whistleblowers will collectively receive a whistleblower award of $920,000 from the proceeds of the government's recovery.  DOJ				 					 

						
Tagged in:
													  Contract Non-Compliance, 
													  Environmental Fraud, 
													  FCA Federal, 
													  Government Procurement Fraud, 
													  Whistleblower Case, 
													  Whistleblower Eligibility, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 26, 2016

				 South Carolina resident William M. Worthy II was sentenced to 82 months in prison and to pay $6,524,889 in restitution and forfeiture for his role in a nationwide health care fraud scheme that defrauded more than 17,000 victims who purchased purported health care coverage from Worthy and his co-conspirators, when in fact the health care plans were not backed by insurance companies.  The purported health care plans were marketed by Tennessee-based Smart Data Solutions LLC.  Worthy also admitted that he and his co-conspirators embezzled funds from premiums paid by individuals who had signed up for these unauthorized health plans, diverting more than $5.4 million in premiums for their own personal use.  DOJ				 					 

						
Tagged in:
													  Healthcare Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 25, 2016

				 Gary Patton Hall Jr., former president and CEO of Georgia-based Tifton Banking Company, was sentenced to 84 months in prison and to pay $3,931,018 in restitution for his role in a conspiracy to commit bank fraud.  Hall admitted he engaged in a scheme to mislead the bank and its loan committee about loans TBC made to local individuals and businesses.  Hall hid past-due loans from the Federal Deposit Insurance Corporation (FDIC) and the TBC loan committee, which resulted in the bank continuing to approve and renew delinquent loans and loans for which the collateral was lacking.  Several of the borrowers eventually defaulted on the loans, resulting in millions of dollars in losses to TBC and others.  In November 2010, the Georgia Department of Banking and Finance closed TBC because of its poor financial condition.  DOJ				 					 

						
Tagged in:
													  Financial Institution Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 23, 2016

				 Las Vegas resident Joseph Micelli was sentenced to 60 months in prison and to pay $5.65 million in restitution and to forfeit $505,220 in fraudulent proceeds for his role in an investment fraud scheme that promoted fraudulent investment opportunities and caused more than $5 million in losses to investors.  Micelli admitted he conspired with others in the U.S. and Switzerland to promote investments and loan instruments he knew to be fraudulent.  They did so through a Swiss company known as the Malom Group A.G.  Micelli further admitted he held himself out to investors as an attorney, when in fact he had lost his license to practice law.  DOJ				 					 

						
Tagged in:
													  Financial and Investment Fraud, 
													  Securities Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 22, 2016

				 Pennsylvania-based importers Ameri-Source International Inc., Ameri-Source Specialty Products Inc., Ameri-Source Holdings Inc., their owners, Ajay Goel and Thomas Diener, and the related importer, SMC Machining LLC agreed to pay $3 million to resolve charges they violated the False Claims Act by engaging in a scheme to evade customs duties on imports of small-diameter graphite electrodes from China.  According to the government, Ameri-Source evaded antidumping duties on 15 shipments of the electrodes by misclassifying the size of the electrodes to avoid paying the duties, which do not apply to larger diameter graphite electrodes.  The allegations originated in a whistleblower lawsuit filed by Graphite Electrode Sales Inc. under the qui tam provisions of the False Claims Act.  The company will receive a whistleblower award of approximately $480,000 from the proceeds of the government’s recovery.  Whistleblower Insider				 					 

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

					
	
							
	
		
		
	


 			


											

						

								

									
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