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Whistleblower News From The Inside -- December 5, 2016

Posted  December 5, 2016

By the C|C Whistleblower Lawyer Team

SEC announces $3.5 million whistleblower award – The SEC has now awarded $135 million to 36 whistleblowers since 2012. Whistleblower actions have resulted in over $874 million in financial remedies.  SEC

“Tax zapper” software seller pleads guilty; will pay $3.4 million – John Yin promoted and sold software designed to allow restaurants to underreport their sales and illegally lower their tax bills. The software was designed by Profitek, a Canadian company, as an add-on to their point of sale program. Revenue suppression software modifies a business’ point of sale database for the purpose of tax evasion.  The program deletes all or some of the business’s cash transactions, and then reconciles the books. Seattle Times

“Big Short” investment advisor will face SEC trial—Wing Chau, who was portrayed in the film “The Big Short,” faces charges of securities fraud in connection with misrepresentation of collateralized debt obligations.  He claimed the SEC’s decision to pursue the claims in an administrative proceeding rather than in federal court violated his equal protection rights and was motivated by the “personal malice” of a former portfolio manager who now works as an investigator for the SEC. The Second Circuit ruled against Chau. Law.com

American Management Services settles charges it defrauded Army at military housing projects – The company will pay $1.6 million to resolve allegations that it skimmed fees from insurance premiums. “Among the services it provided, AMS arranged for property and general liability insurance for each military base through an insurance broker that would invoice the premiums to Clark and the Army.  Unbeknownst to the Army or Clark, however, that broker kicked back to AMS a ‘risk management fee’ taken from the premiums paid by Clark, the Army and various joint AMS-Clark entities, which AMS concealed in invoices to the Army and Clark.” US DOJ

Florida health system dismisses interim CEO over kickback allegations – Broward Health has dismissed Pauline Grant following an independent counsel review that showed potential violations of the anti-kickback statute.  “The findings of the independent investigation are being reported to the Office of the Inspector General, as per the corporate integrity agreement under which the health system operates. The agreement was put into place after the system paid the government $69.5 million in September 2015, to settle allegations that it violated the False Claims Act by holding improper financial relationships with physicians.” Becker’s Hospital Review