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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 8, 2022

				 The owner and operator of Rust Rare Coin, Inc. (RRC), Gaylen Dean Rust, has been sentenced to 19 years in prison for running a 12-year Ponzi scheme that defrauded 568 victims of over $153 million.  Many of the victims were his own family, friends, and fellow church members, whom he’d convinced to invest in RRC’s silver trading program through false promises.  Rust was also convicted of laundering $18 million in fraud proceeds through three personal bank accounts.  USAO UT				 					 

						
Tagged in:
													  Financial and Investment Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 8, 2022

				 Eugene Sisco, III of Kentucky, the owner and operator of several medication assisted treatment (MAT) clinics for opioid addiction, has been sentenced to over 10 years in prison and ordered to pay $5.7 million in restitution, after being convicted of healthcare fraud.  Sisco was found to have tricked Medicaid patients into paying hundreds of dollars in cash each month for MAT services which he later billed and was reimbursed by Medicaid for.  Sisco’s laboratory, Toxperts, LLC, was also found to have billed Medicare for medically unnecessary urine drug tests, causing a loss of over $2 million to CMS.  USAO EDKY				 					 

						
Tagged in:
													  Healthcare Fraud, 
													  Laboratory and IDTF, 
													  Lack of Medical Necessity, 
													  Medicaid, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 8, 2022

				 Comprehensive Health Services LLC (CHS), a Florida-based contractor that provides medical services at government facilities in Iraq and Afghanistan, has agreed to pay $930,000 to resolve claims under the False Claims Act.  According to two separate qui tam cases filed in the Eastern District of New York, CHS falsely certified to the State Department and Air Force that it had complied with contractual cybersecurity requirements when, in fact, it had failed to to properly store patient medical records on a secure electronic medical record system, and had falsely represented that it used approved medical supplies when, in fact, it had relied on unapproved controlled substances from foreign sources.  DOJ; USAO EDNY; USAO MDFL				 					 

						
Tagged in:
													  Certifications, 
													  Contract Non-Compliance, 
													  Cybersecurity and Data Breaches, 
													  FCA Federal, 
													  Government Procurement Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 7, 2022

				 Pharmaceutical company Mallinckrodt ARD LLC will pay $260 million to resolve allegations that it violated the False Claims Act in the sale and marketing of its drug H.P. Acthar Gel.  The government intervened in whistleblower actions alleging that Mallinckrodt and its predecessor Questcor Pharmaceuticals Inc. knowingly underpaid state Medicaid programs by improperly calculating amounts it owed under the Medicaid Drug Rebate Program, and unlawfully used a foundation as a conduit to subsidize co-payments.  With respect to the Medicaid rebate claims, which represent $234.7 million of the settlement, defendants were alleged to have calculated rebate amounts as if Acthar was a “new drug” first marketed in 2013, rather than a drug that had been approved since 1952.  By using 2013 for Acthar’s Base Date Average Manufacturer Price (AMP), the company ignored price increases prior to 2013 and fraudulently reduced Acthar drug rebates.  With respect to the copayment fraud claims, which represent $26.3 million of the settlement, defendants were alleged to have violated the Anti-Kickback Statute by subsidizing copayments through payments to three funds that Mallinckrodt had a foundation set up to induce Medicare-reimbursed purchases of Acthar, using the subsidies to counteract doctor and patient concerns about the drug’s high cost.  The whistleblower in the Medicaid rebate case, James Landolt will receive an award of $24.7 million, representing 20% of the $123.6 million federal share of that settlement; the relator’s share for the state share of the settlement was not announced.  The whistleblowers in the copayment case, Charles Strunck and Lisa Pratta, will receive an award of $4.9 million, representing 19% of that settlement.  The settlement includes a five-year corporate integrity agreement (CIA) with monitoring provisions.  DOJ; USAO MA; USAO EDPA				 					 

						
Tagged in:
													  Anti-Kickback and Stark, 
													  Drug and DME Pricing, 
													  Healthcare Fraud, 
													  Medicaid, 
													  Pharma Fraud, 
													  Whistleblower Case, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 7, 2022

				 A woman in Illinois, Tarnavis Lee, has been sentenced to 3 years in prison for defrauding the Illinois Department of Human Services (DHS) of nearly $1 million.  Along with co-conspirators Demetra Jackson and Elizabeth McFarland, Lee submitted false and fraudulent claims to DHS’s Child Care Assistance Program—which funds childcare for low-income parents while they work or attend educational programs—for services that were not provided.  The scheme ran for a ten-year period ending in 2019.  USAO CDIL				 					 

						
Tagged in:
													  Government Programs Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 7, 2022

				 Redwood Toxicology Laboratory has agreed to pay nearly $4.8 million to settle allegations that the California-based urine drug testing service overcharged the Connecticut Medicaid program for certain laboratory services, in violation of Connecticut’s “Most Favored Nation” regulation, which provides that the state should not be charged more than the lowest price charged to third parties.  The settlement covered claims submitted between January 2015 through February 2018.  USAO CT				 					 

						
Tagged in:
													  FCA Federal, 
													  FCA State, 
													  Healthcare Fraud, 
													  Laboratory and IDTF, 
													  Medicaid, 
													  Medical Billing Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 7, 2022

				 MOX Services LLC, formerly known as CV&I AREVA MOX Services LLC (MOX), has agreed to a $10 million settlement to resolve allegations of violating the False Claims Act.  As the prime contractor for a federal facility in South Carolina, MOX was responsible for confirming receipt of materials from any subcontractors before presenting claims to the government.  According to the DOJ, however, MOX knowingly sought reimbursement from the Department of Energy for millions of dollars of materials not received from one of its subcontractors, Wise Services Inc., and which it submitted to the DOE in exchange for kickbacks from Wise.  DOJ				 					 

						
Tagged in:
													  FCA Federal, 
													  Government Procurement Fraud, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
March 3, 2022

				 New York-based ophthalmologist Ameet Goyal, M.D., who owned and operated Rye Eye Associates, has been sentenced to 8 years in prison and ordered to pay $3.6 million in forfeiture as well as $3.6 million in restitution for submitting $3.6 million in upcoded charges to Medicare, private insurers, and patients between 2010 and 2017.  While facing charges for healthcare fraud in 2020, Goyal also falsely certified that he was not facing any criminal charges in order to obtain over $600,000 in loans from the Paycheck Protection Program.  USAO SDNY				 					 

						
Tagged in:
													  FCA Federal, 
													  Healthcare Fraud, 
													  Medical Billing Fraud, 
													  Medicare, 
													  Upcoding, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 23, 2022

				 TriMark USA, LLC and related entities will pay $48.5 million to resolve claims brought in a whistleblower lawsuit alleging that they improperly manipulated federal contract set-asides for service-disabled, veteran-owned small businesses (SDVOSB) by enlisting small business to secure the contracts while TriMark actually performed all of the work and received most of the benefits of the federal contract.  In addition, former TriMark executive Kimberley Rimsza has agreed to pay $100,000 to resolve claims against her.  The whistleblower, Fox Unlimited Enterprises, LLP, will receive an award of $10.9 million.  USAO ND NY; USAO ED WA				 					 

						
Tagged in:
													  FCA Federal, 
													  Government Procurement Fraud, 
													  Set-Asides and Preferences, 
													  Whistleblower Case, 
													  Whistleblower Rewards, 
												
						

					
	
							
	
		
		
	


 			




	
		
		

			

				
				
February 18, 2022

				 Muhammad Ateeq, of Rawalpindi, Pakistan, was sentenced to 12 years in prison and ordered to pay more than $50 million in restitution for forfeiture for submitting fraudulent claims to Medicare for home health services. Ateeq acquired and managed home health agencies in the United States, using false identities. He then used these home health agencies to submit fraudulent Medicare claims totaling over $40 million for services not rendered. The ill-gotten gains were laundered through U.S. bank accounts designated by overseas customers of overseas money transmitting businesses. Cash payments were then transmitted to accounts in Pakistan which Ateeq controlled. Fraud proceeds were also used to purchase luxury items which were delivered to Ateeq’s Dubai associates. DOJ				 					 

						
Tagged in:
													  Criminal Proceedings, 
													  Healthcare Fraud, 
													  Home Health and Hospice, 
													  Medical Billing Fraud, 
												
						

					
	
							
	
		
		
	


 			


											

						

								

									
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