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Criminal Proceedings

This archive displays posts tagged as involving criminal law proceedings relevant to whistleblowers. You may also be interested in our pages:

Page 14 of 37

March 26, 2021

David Boice, the co-founder and CEO of Trustify Inc., was sentenced to 8 years in prison and ordered to pay $18.1 million in restitution and $3.7 million in forfeiture following SEC charges that Boice misrepresented Trustify, an online marketplace purportedly designed to connect customers to a network of private investigators, as a successful business, fraudulently offering and selling over $18.5 million of securities to more than 250 individual and corporate investors.  Boice inflated company revenues in financial statements, fabricated customer relationships, forged correspondence purportedly from potential investors, and misrepresented the use of investor funds.  Trustify was placed in corporate receivership in 2019.  USAO ED VA

Tagged in: Criminal Proceedings, Financial and Investment Fraud, Misrepresentations, Securities Fraud,

Catch of the Week: Founders of Poop-Testing Startup uBiome Face Fraud Charges

Posted  03/24/21
specimen jar
San Francisco-based uBiome and its founders Jessica Richman and Zachary Apte claimed they were “inventing the microbiome industry” and “making products that improve people’s lives.” Once considered a Silicon Valley success story, today, uBiome is bankrupt and its founders face various federal securities fraud and related criminal conspiracy charges. The biotech startup sold home medical tests including...

Tagged in: Catch of the Week, Criminal Proceedings, Improper Medical Facility, Medical Billing Fraud, Securities Fraud,

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March 4, 2021

Sohrab Sharma, a co-founder of Centra Tech, which claimed to offer products including a debit card that would allow users to make retail purchases using cryptocurrency, has been sentenced to eight years in prison following his guilty plea to charges arising from Centra’s fraudulent representations to participants in its unregistered initial coin offering of “Centra Tokens” or “CTR tokens,” which raised more than $25 million from victims.  Sharma and his co-defendants falsely claimed that Centra Tech had an experienced executive team, agreements with card issuers, and licenses to operate in 38 states when, in fact, Centra Tech had none of these things.  USAO SDNY

Tagged in: Criminal Proceedings, Cryptocurrency, Financial and Investment Fraud, Regulatory Violations, Securities Fraud,

March 2, 2021

North Carolina durable medical equipment provider A Perfect Fit for You, Inc. and its owner Margaret Gibson have agreed to pay a total of $24.14 million to resolve civil claims that they falsely billed Medicaid for DME that had never been ordered or delivered, including by using the personally identifying information of Medicaid recipients who had been dead for years.  In addition, to resolve criminal charges of healthcare fraud, the company will pay an additional $2 million fine and $10.1 million in restitution to the North Carolina Medicaid program.  USAO ED NC

Tagged in: Criminal Proceedings, FCA Federal, Healthcare Fraud, Medicaid, Medical Billing Fraud, Medical Devices and DME,

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

Tagged in: Contract Non-Compliance, Criminal Proceedings, Falsifying Invoices, FCA Federal, Government Procurement Fraud,

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

Tagged in: Criminal Proceedings, FCA Federal, Healthcare Fraud, Medical Billing Fraud, Provider Fraud, Whistleblower Case, Whistleblower Rewards,

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

Tagged in: Accounting Fraud, Criminal Proceedings, Financial and Investment Fraud, Misrepresentations,

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

Tagged in: Criminal Proceedings, Financial and Investment Fraud,

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

Tagged in: Criminal Proceedings, Financial and Investment Fraud, Ponzi Schemes,

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

Tagged in: Criminal Proceedings, Financial and Investment Fraud,

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