Whistleblower News: Libor Fraud, Medicaid Fraud and Whistleblower Settlements
WHISTLEBLOWER NEWS QUOTE OF THE DAY:
“Hopefully the sentences today will serve as a deterrent to other unscrupulous health care providers who aim to steal the taxpayers’ money.”
—U.S. Attorney for the District Channing D. Phillips
DAILY WHISTLEBLOWER HEADLINES:
BREAKING: Two Ex-Deutsche Bank Employees Indicted For Libor Fraud
Two former traders at Deutsche Bank have been hit with federal criminal charges in New York for allegedly working to manipulate the London Interbank Offered Rate, the U.S. Department of Justice said Thursday.
Matthew Connolly of New Jersey and Gavin Campbell Black of London were charged with wire fraud and conspiracy to commit wire fraud and bank fraud, the DOJ said. Both men allegedly tried to manipulate the U.S. dollar Libor rate to benefit themselves or Deutsche Bank AG.
"Healthy financial markets are crucial to a successful economy," Deputy Assistant Attorney General Brent Snyder of the DOJ's Antitrust Division said in a statement. "By corrupting this important benchmark rate, the defendants undermined the integrity of financial markets here and around the world. The department is committed to holding individuals accountable for the roles they play in committing complex financial crimes." read more »
Ex-Hospice Head Set to Plead to Medicare, Medicaid Fraud
The former head of a hospice who allegedly used patients that weren't terminally ill to collect millions of dollars in false Medicare and Medicaid billings was scheduled to plead guilty.
Former Horizons Hospice chief operating officer Mary Ann Stewart, 48, was indicted in Pittsburgh last year on one count of health care fraud and four counts of lying to a federal grand jury.
One of the grand jury counts was dismissed last year after a judge agreed with Stewart's attorney that questions about whether her estranged husband stayed in hotels on the company's dime weren't specific enough. Stewart is still accused of three counts stemming from allegedly false or misleading answers about how her staff went about recruiting patients for the hospice, however.
Stewart's attorney, Robert Goldman, didn't respond to phone and email messages seeking comment in advance of Thursday afternoon's change of plea hearing. Stewart has previously pleaded not guilty to the charges, but was scheduled to change that plea, according to online court records.
The indictment contends the alleged fraud cost the government unspecified millions of dollars from January 2008 through August 2012 at the facility in Monroeville, about 15 miles east of Pittsburgh. The indictment alleges she conspired with unnamed "others known to the grand jury," but federal prosecutors have not said whether anyone else might be charged and have yet to file any additional charges.
Md. couple sentenced to prison in $80 million Medicaid fraud in nation’s capital
A federal judge on Wednesday sentenced a Bowie, Md., wife and husband to 10 and seven years in prison, respectively, for orchestrating a multiyear campaign to defraud D.C. Medicaid of more than $80 million between 2009 and 2014, the largest local health-care fraud scheme ever prosecuted in the city.
Florence Bikundi, 53, and Michael D. Bikundi Sr., 63, were ordered to forfeit more than $11 million in cash, their $1 million home and five luxury vehicles by Chief Judge Beryl A. Howell of the U.S. District Court for the District of Columbia, who also imposed a money judgment of $40 million and ordered the couple to pay $80.6 million in restitution.
“Florence and Michael Bikundi enriched themselves for years by operating a rogue home care agency,” at the expense of people in need, U.S. Attorney for the District Channing D. Phillips said in a joint statement with the FBI and Secret Service Washington field offices, and inspectors general for the U.S. Department of Health and Human Services and the District of Columbia.
“Hopefully the sentences today will serve as a deterrent to other unscrupulous health care providers who aim to steal the taxpayers’ money,” Phillips said.
A federal jury in November found the couple guilty of multiple counts of money laundering, health-care fraud and conspiracy through their District-based home health-care firm, Global Health Care Services. read more »
Former CalPERS chief sentenced to prison in bribery scandal
He arrived in plain jail clothes, shackles around his ankles, the humbled former leader of America’s largest public pension fund ready to accept his punishment for taking bribes.
He left with a prison term of 4 1/2 years.
Fred Buenrostro, the former chief executive of CalPERS, was sentenced Tuesday by a federal judge who called his actions “a spectacular breach of trust.”
Buenrostro, 66, pleaded guilty to a conspiracy charge nearly two years ago, admitting he took more than $250,000 in cash and other bribes from his friend and former CalPERS board member Alfred Villalobos. Prosecutors said Villalobos, who killed himself last year, was attempting to steer pension fund investments to the private equity firms he represented.
Court records show Buenrostro let Villalobos pay for his wedding in 2006 – and then accepted $200,000 in cash a year later to pay the fees from his divorce. Villalobos also took Buenrostro and a CalPERS board member, the late Charles Valdes, on a global junket, all expenses paid. Another $50,000 came later.
Buenrostro’s sentencing, following numerous postponements, appears to effectively wrap up a scandal that has dogged CalPERS for nearly seven years. “We feel like this is the end of a chapter that was painful for us (but) it is passed,” said Buenrostro’s successor, Anne Stausboll, in a phone interview. “CalPERS has emerged a stronger organization.”
Escorted into the courtroom by federal marshals, Buenrostro wore a two-piece blue jail outfit, the result of his recent imprisonment on unrelated battery charges. He hardly looked like the longtime state employee who ran the California Public Employees’ Retirement System for six years and often testified at the Capitol or pension board meetings in a dark suit, crisp white shirt and tie. read more »
WHISTLEBLOWER SETTLEMENT NEWS:
Drug testing lab, doc paying $9M+ to settle False Claims Act case
A federal investigation of a whistleblower complaint into a local drug testing laboratory has yielded a settlement under which the company and its former owner and CEO will pay more than $9.3 million to settle False Claims Act allegations.
The U.S. Attorney’s Office for the Middle District of Tennessee on Wednesday said Jonathan Oppenheimer, who ran OURLab, and OPKO Lab, the company that bought OURLab, violated anti-kickback statutes by placing certain conditions on the financial support they were giving physician practices investing in electronic health records systems. Specifically, the U.S. Attorney’s Office alleges OURLab and Oppenheimer took into account the value of referrals when making investments — they are allowed to pick up the tab for up to 85 percent of such systems’ prices — or withheld promised investments until a doctor group had referred a certain number of patients.
"This laboratory traded physicians free computer software for patient referrals," said Derrick Jackson, an Atlanta-based special agent in charge at the U.S. Department of Health and Human Services’ Office of Inspector General. "Such quid pro quo arrangements are kickbacks that stifle competition and steer business to the company offering the inducements." read more »
San Diego’s Harper Construction Pays $5.4 Million to Resolve Allegations of Defrauding the United States
Harper Construction Company, Inc. has paid $5.4 million to the United States to resolve allegations that it fraudulently billed the government for work on multiple projects on military bases. It was alleged that Harper knowingly used sham small disadvantaged businesses and then falsely certified to the government that it used legitimate small disadvantaged businesses.
Harper is a large, privately-held general contractor headquartered in San Diego. Harper earns a substantial portion of its revenue through government contracting on construction projects across the country.
The settlement involves four government contracts to construct facilities at Camp Pendleton and Camp Lejeune. The contracts required Harper to subcontract a certain percentage of work to small disadvantaged businesses. Such requirements arise from measures intended to ensure that a fair proportion of federal contract and subcontract dollars are awarded to small businesses. It was alleged that Harper claimed it met this requirement when, in fact, it subcontracted with sham small disadvantaged businesses. Also, Harper allegedly required the sham small businesses to pass through all of their work to an affiliated large business, Frazier Masonry Corporation.
This settlement resolves a False Claims Act lawsuit filed by Rickey Howard, a former employee of Harper subcontractor Frazier Masonry Corporation. The whistleblower, or qui tam, provisions of the False Claims Act permit the whistleblower (or relator) to recover a portion of the proceeds obtained by the government. As part of today’s resolution, Mr. Howard will receive $1,485,000.
“This type of fraud siphons taxpayer dollars and takes away opportunities for legitimate small businesses for which this money was set aside,” said U.S. Attorney Duffy. “Whistleblowers are essential in our efforts to recover taxpayer dollars and combat fraud. We commend the whistleblower for coming forward and making the United States aware of this alleged fraud, and we welcome others who are aware of fraudulent conduct to also blow the whistle on fraudsters.” read more »
