Defense contractor Inchcape Shipping Services to pay $20 million to settle fraud case over charges to Navy

A major defense contractor agreed to pay $20 million to settle U.S. charges that it bilked the Navy in a ship-supply contracting scandal at ports around the world, the Justice Department announced.

The Navy in 2013 suspended business with Inchcape Shipping Services, and the U.S. government joined a whistleblower fraud suit in November 2015 after settlement talks broke down with the maritime trading firm that delivers port services in 66 countries. read more »

$114 Million Judgment Against Three Individuals for Paying Kickbacks

On May 23, 2018, the United States District Court in the District of South Carolina entered judgment for the United States in the amounts of $111,109,655.30 against defendants LaTonya Mallory, Floyd Calhoun Dent III and Robert Bradford Johnson, and for an additional $3,039,006.56 against Johnson and Dent, the Department of Justice announced today.  The judgment follows the January 31, 2018, jury verdict finding the three individuals liable for violating the False Claims Act (FCA) by paying remuneration to physicians in exchange for patient referrals, in violation of the Anti-Kickback Statute, and causing two laboratories to bill federal health care programs for medically unnecessary testing. 

“Improper financial relationships between physicians and laboratories can distort a physicians’ best judgment for their patients, in addition to undermining patient health and trust,” said Acting Assistant Attorney General for the Justice Department’s Civil Division Chad Readler.  “Executives and other individuals who break the law will be held personally accountable for their actions." 

During a two-week jury trial held in Charleston, South Carolina, the government introduced evidence that the defendants paid physicians remuneration disguised as processing and handling fees of between $10 and $17 for each patient they referred to two blood testing laboratories:  Health Diagnostics Laboratory Inc. (HDL), of Richmond, Virginia; and Singulex Inc., of Alameda, California.  The government also introduced evidence that the kickback scheme resulted in physicians referring patients to HDL and Singulex for medically unnecessary tests, which were then billed to federal health care programs. 

The jury found Mallory, HDL’s former CEO, and Johnson and Dent, who marketed and sold HDL’s and Singulex’s tests, jointly and severally liable for causing the submission of 35,074 false claims, worth $16,601,591, submitted to Medicare and TRICARE by HDL.  The jury also found defendants Dent and Johnson jointly and severally liable for an additional 3,813 false claims, worth $467,935, submitted by Singulex.  As provided by the FCA, the Court trebled those damage amounts, offset settlement payments received from HDL and Singulex for the same claims, and awarded $63.8 million in penalties requested by the United States, for a total judgment of $114,148,661.86. read more »

Malaysia Asks $8.3 Billion Question on 1MDB. Here's What We Know

Malaysia’s new government has wasted no time training its sights on 1MDB, the scandal-ridden state investment company that’s spurred criminal and regulatory probes around the world.

Less than a day after taking office, new Finance Minister Lim Guan Eng had ousted premier Najib Razak in his cross-hairs as he spoke of a cover-up of 1MDB’s finances. In his latest salvo, Lim asked Najib to explain where $8.3 billion raised and planned for certain ventures had "gone to," implying funds may have been misused when the former leader was chairman of 1MDB’s advisory board.

But answers to Lim’s queries can be found in documentation assembled by investigators from Switzerland to the U.S. and Singapore as they probe 1MDB’s links to cases of embezzlement and money laundering. In mapping a money trail that stretched from Kuala Lumpur to Hollywood, U.S. authorities laid out how about $4.5 billion of 1MDB funds may have been misappropriated, while a Malaysian probe separately identified billions of dollars more missing in irregular transactions. Under Najib’s administration, 1MDB consistently said all its funds were accounted for. read more »

Cryptocurrency Attacks Are Rising

One of the most-feared quirks of cryptocurrencies is becoming more of a headache.

Over the past few weeks, rogue operators of some of the computer networks that perform the complex calculations that verify transactions for various coins are attacking their own networks again. This time it’s Bitcoin Gold, an offshoot of the most widely known form of digital money, with a $729 million market capitalization.

Such 51 percent attacks, in which so-called miners gain control of the majority of the network’s computing power to falsify transactions, are generating ill-gotten gains that risk collapsing the value of the coins. Under attack for more than a week, Bitcoin Gold is down 26 percent since May 18. read more »