title: Pine Ridge Man Found Guilty at Jury Trial

component: USAO - South Dakota

body_text: RAPID CITY - United States Attorney Alison J. Ramsdell announced that a jury has convicted JT Myore, age 36, of Pine Ridge, South Dakota, of Robbery, Carjacking, and Brandishing a Firearm During a Crime of Violence following a three-day jury trial in federal district court in Rapid City, South Dakota. The verdict was returned on September 27, 2023. The charges carry a mandatory minimum of seven years in custody up to life, and/or a $250,000 fine, five years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund for each count. Myore was indicted by a federal grand jury in July of 2021. He was charged in connection with two separate incidents, and the first one occurred in August of 2019 and the second in May of 2021. In August of 2019, Myore and a co-defendant brandished firearms in order to carjack a Ford Freestyle from another male in Pine Ridge. In May of 2021, Myore and his co-defendants forcibly assaulted a male in Pine Ridge in order to steal his Toyota Celica. The male sustained a broken arm and cuts and contusions to his head and face. This matter was prosecuted by the U.S. Attorney’s Office because the Major Crimes Act, a federal statute, mandates that certain violent crimes alleged to have occurred in Indian country be prosecuted in federal court as opposed to State court. This case was investigated by the FBI, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Attorney Megan Poppen prosecuted the case. A presentence investigation was ordered and a sentencing date will be set. The defendant was remanded to the custody of the U.S. Marshals Service.


title: Rapid City Man Sentenced for Conspiring to Distribute Methamphetamine

body_text: RAPID CITY - United States Attorney Alison J. Ramsdell announced today that Chief Judge Roberto A. Lange, U.S. District Court, has sentenced a Rapid City, South Dakota, man convicted of Conspiracy to Distribute a Controlled Substance. The sentencing took place on September 28, 2023. Eugene Perez, 44, was sentenced to 11 years and five months in federal prison, followed by five years of supervised release, and ordered to pay a $100 special assessment to the Federal Crime Victims Fund. Perez was indicted for Conspiracy to Distribute a Controlled Substance and Possession of a Firearm by a Prohibited Person by a federal grand jury in January of 2022. He pleaded guilty on June 28, 2023. The charge stems from Perez conspiring with others to distribute multiple pounds of methamphetamine in and around Rapid City between January 2018 and December 2021. The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, Unified Narcotics Enforcement Team, Pennington County Sheriff’s Office, South Dakota Department of Criminal Investigation, and the South Dakota Highway Patrol. Assistant U.S. Attorney Benjamin Patterson prosecuted the case. Perez was immediately remanded to the custody of the U.S. Marshals Service.


title: Texas Man Sentenced for Violating the Federal Controlled Substances Act

component: Drug Enforcement Administration (DEA)

body_text: NEW ORLEANS, LOUISIANA – RAFAEL MOLINA , age 47, a resident of Edinburg, Texas was sentenced on September 20, 2023 by Chief United States District Judge Nannette Jolivette Brown to one hundred fifty-four (154) months imprisonment, five years of supervised release, and $200.00 in mandatory special assessment fees after pleading guilty to a superseding bill of information charging him with conspiracy to distribute and possess with intent to distribute five kilograms or more of cocaine hydrochloride, in violation of Title 21, United States Code, Sections 841(a)(1), (b)(1)(A), and 846, and interstate transportation in aid of racketeering, in violation of Title 18, United States Code, Sections 1952(a)(3) and 1953(a)(3)(A), announced U.S. Attorney Duane A. Evans. According to court documents, in July 2018, Special Agents with the Drug Enforcement Administration (DEA) identified MOLINA as a Mexican-based drug trafficker who supplied kilogram quantities of cocaine hydrochloride to customers in the Lafourche Parish area. On February 9, 2018, agents learned that MOLINA was bound for Thibodaux, Louisiana to deliver two kilograms of cocaine hydrochloride to a customer the following day. Agents and officers established surveillance in Thibodaux and observed Molina driving a white pickup truck, as well as two individuals, identified as Gustavo Balderas and Michael Garza, in a black Chrysler 300, at a motel. Balderas and Garza entered the truck driven by Molina, and they drove away from the motel. Officers then stopped the truck, searched both vehicles, and located an ice chest containing two kilograms of cocaine hydrochloride, in the Chrysler 300. This prosecution is part of an extensive investigation by the Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF is a joint federal, state, and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets. This case was investigated by the Drug Enforcement Administration, Office of Homeland Security Investigations, Terrebonne Parish Sheriff’s Office, and the Lafourche Parish Sheriff’s Office. The prosecution is being handled by Assistant United States Attorney André Jones of the Narcotics Unit.


title: Stanford University Agrees to Pay $1.9 Million to Resolve Allegations that it Failed to Disclose Foreign Research Support in Federal Grant Proposals

component: USAO - Maryland

body_text: Baltimore , Maryland – Stanford University, located in Palo Alto, California, has agreed to pay $1.9 million to resolve allegations that it violated the False Claims Act by submitting proposals for federal research grants that failed to disclose current and pending support that twelve Stanford faculty members were receiving from foreign sources. The settlement was announced by United States Attorney for the District of Maryland Erek L. Barron and Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. The settlement relates to research grants that Stanford received between 2015 and 2020 from five federal agencies: The Departments of the Army, Navy and Air Force, the National Aeronautics and Space Administration (NASA) and the National Science Foundation (NSF). All of these agencies require grant applicants to disclose all current and pending support received by the institution and the principal investigators (PIs) and co-PIs on the grant proposals. Current and pending support is defined as all resources from whatever source — including foreign government sources — that are made available to researchers in support of and/or related to their research endeavors. The United States alleged that on sixteen grant proposals submitted to the Army, Navy, NASA and NSF, Stanford knowingly failed to disclose current and pending foreign funding that eleven Stanford PIs and co-PIs had received or expected to receive in direct support of their research. The United States further alleged that Stanford knowingly failed to disclose to the Army, Air Force and NSF that a Stanford professor received research funding in connection with his employment at Fudan University, a foreign public university and from a foreign government’s national science foundation. In connection with the settlement, Stanford has agreed to work with the NSF Office of the Chief of Research Security Strategy and Policy on best practices in the areas identified by the United States. “Complete and accurate disclosures by principal investigators and universities of current and pending support are essential to federal agencies that make decisions on awarding federal grants,” said Erek Barron, United States Attorney for the District of Maryland. “Those individuals and universities that knowingly fail to do so skew the grant awarding process in their favor and will be held accountable.” “Universities and their researchers must disclose all sources of current and pending support, including any foreign support, in federal research grant applications,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will continue to ensure that grant applicants submit complete and truthful disclosures, so the government has full transparency into the applicant’s funding sources.” “The National Science Foundation awards billions of dollars in grants each year to promote promising scientific research. NSF and other federal funding agencies rely on grant recipients to accurately track the commitments of their personnel and fully disclose all funding sources. Stanford failed to disclose foreign funding in grant proposals submitted to multiple federal agencies. Full and accurate disclosures are essential to protect the interests of American taxpayers and ensure that federal funds are properly awarded to deserving institutions,” said NSF Inspector General Lerner. “We thank the Department of Justice, U.S. Attorney’s Office for the District of Maryland, and our investigative partners for their work in protecting the integrity of federal research.” “This settlement is a prime example of our agents and partner law enforcement agencies pursuing those who do not disclose foreign government ties when entering into contracts with the U.S. Army,” said Acting Special Agent-in-Charge Michael Curran for the Department of the Army Criminal Investigation Division, Major Procurement Fraud Field Office. “It is imperative that when someone partners with the U.S. Army, they comply with all their obligations.” “The failure of U.S. universities to disclose current or pending awards with foreign entities on research grant proposals submitted to the U.S. Government as required by law has the potential to threaten government interests,” said Assistant Director Thomas Cannizzo of the NCIS National Security Directorate. “Through the efforts of the National Science Foundation with support from NCIS and additional law enforcement partners, sensitive research funded by the U.S. military was protected from disclosure to foreign interests.” “Protecting research and development programs funded by taxpayer dollars is a top priority for us,” said Acting Assistant Inspector General for Investigations Michael Graham at the NASA Office of Inspector General (OIG). “The settlement agreement with Stanford University is the result of a joint effort to guard against fraud, waste and abuse in government grants. This case demonstrates the commitment of NASA OIG and our partners to work with the U.S. Attorney’s Office to safeguard public funds.” “This settlement demonstrates the Office of Procurement Fraud’s determination and commitment to identify and hold accountable those who conceal foreign affiliations to obtain research funding,” said Special Agent in Charge William W. Richards for the Air Force Office of Special Investigations (AFOSI). “AFOSI, along with our law enforcement and prosecutorial partners, will continue to work tirelessly to protect the integrity of the Federal grant process." The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section and the United States Attorney’s Office for the District of Maryland, with assistance from Army CID, NCIS, AFOSI, NSF OIG, NASA OIG and the Department of Education. The matter was investigated by Assistant U.S. Attorney Thomas F. Corcoran and by Trial Attorney Sarah E. Loucks of the Civil Division’s Commercial Litigation Branch (Fraud Section). The claims resolved by the settlement are allegations only and there has been no determination of liability. For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach . # # #


title: Man Sentenced for Lying  to Federal Grand Jury and Violating Federal Gun Control Act

component: Federal Bureau of Investigation (FBI)

body_text: NEW ORLEANS, LOUISIANA – JAMES HEIGLE , age 41, of St. Tammany Parish, was sentenced on September 28, 2023, after previously pleading guilty to Counts 4, 5, and 6 of the superseding indictment handed down by a federal grand jury, charging him with violations of Title 18, United States Code, Sections 1623, 922(g)(1), 924(a)(2), 931, and 924(a)(7), respectively. As to the charges for false declarations before a grand jury and felon in possession of a firearm, HEIGLE was sentenced to 27 months imprisonment, three years of supervised release, and a $200 mandatory special assessment fee. As to the charge of violent felon in possession of body armor, HEIGLE was sentenced to 27 months imprisonment, 1 year of supervised release, and a $100 mandatory special assessment fee. All sentences are to run concurrently with each other. Between May 8 – 29, 2019, HEIGLE possessed multiple firearms and a bullet-proof vest. Prior to May 2019, HEIGLE had been convicted of a violent felony in Jefferson Parish, that precluded him from possessing firearms and a bullet-proof vest. This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results. The case was investigated by the Federal Bureau of Investigation and the New Orleans Police Department. The prosecution was handled by Assistant United States Attorney Lynn E. Schiffman of the Narcotics Unit.


title: Las Vegas Man Sentenced To 23 Years In Prison For Committing Two Armed Carjackings, Shooting At Police During Car Pursuit, And Assaulting A Federal Corrections Officer

component: USAO - Nevada

body_text: LAS VEGAS – A Las Vegas man was sentenced today by United States District Judge Gloria M. Navarro to 23 years in prison followed by three years of supervised release for two carjackings during which he brandished a firearm and shot at one victim, shooting at police officers during the vehicle pursuit, and for assaulting a federal officer while in custody. Justin Venegas (41) pleaded guilty to two counts of carjacking, one count of brandishing a firearm during and in relation to a crime of violence, one count of felon in possession of a firearm, and one count of assault on a federal officer which inflicts bodily injury. According to court documents, on August 11, 2022, Las Vegas Metropolitan Police Department (“LVMPD”) was pursuing Venegas for a robbery/carjacking that occurred on May 20, 2022. While at an intersection, Venegas pointed a firearm at the driver of another vehicle and to into the vehicle. He then put the firearm into the victim’s stomach and forcibly removed the victim from their vehicle. Venegas drove away in the victim’s vehicle. During the pursuit, Venegas reached out the driver’s window and fired several rounds at the front windshield of the pursuing officers’ patrol vehicle. Later, Venegas attempted to carjack a second victim. He shot at and struck the second carjacking victim using a firearm. While the pursuit continued, Venegas collided head on with a K9 police vehicle. He was placed under arrest. A search of the vehicle revealed a Smith and Wesson M&P Shield with an obliterated serial number. A National Integrated Ballistic Information Network (NIBIN) analysis showed that the firearm was the same gun that was discharged during the pursuit and at a police officer. Venegas is a convicted felon, and he is prohibited by law from possessing a firearm. Later, on October 1, 2022, at the Nevada Southern Detention Center, Venegas punched a detention officer in the face causing the officer to fall to the ground. The detention officer suffered facial fractures, lacerations, and a dislocated thumb. “The defendant will spend the next 23 years in prison for putting the public and police officers in danger with his senseless, violent actions in his attempt to evade apprehension, and for assaulting a detention officer while in custody,” said United States Attorney Jason M. Frierson for the District of Nevada. “In this case, NIBIN crime gun tracing connected the gun used in the first and second carjackings by the defendant. Together with our law enforcement partners, we will continue to combine resources to protect our communities and to bring violent offenders to justice.” “The defendants’ sentence should serve as a deterrent to anyone who is considering terrorizing the safety and security of our community by committing armed carjackings,” said Special Agent in Charge Spencer L. Evans for the FBI. “The sentence also reflects the severity of the crime and the commitment of the FBI, along with our federal, state, and local partners, to reduce the potential of future carjacking offenses, a major driver of violent crimes.” This case was investigated by the FBI and Las Vegas Metropolitan Police Department. Assistant United States Attorney Allison Reese prosecuted the case. ###


title: Tampa Man Charged With Possession And Distribution Of Methamphetamine, Fentanyl, And Heroin

component: USAO - Florida, Middle

body_text: Tampa, Florida – United States Attorney Roger B. Handberg announces the unsealing of an indictment charging Shane Valmont (43, Tampa) with possession and distribution of methamphetamine, fentanyl, and heroin. If convicted, Valmont faces a minimum mandatory penalty of 10 years, up to life, in federal prison on each count. The indictment also notifies Valmont that the United States intends to forfeit any assets, which are alleged to be traceable to proceeds of the offense. According to the indictment, Valmont was involved in two deliveries of controlled substances in Pinellas County. On December 27, 2022, Valmont distributed 50 grams or more of methamphetamine. On January 17, 2023, Valmont distributed 40 grams or more of fentanyl and heroin. An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty. This case was investigated by the Drug Enforcement Administration and the Clearwater Police Department. It will be prosecuted by Assistant United States Attorney Maria Guzman.


title: Lincoln Man Sentenced to 24 Months for Possession of a Firearm

body_text: Acting United States Attorney Susan Lehr announced that Davonte Brown, 24, of Lincoln, Nebraska, was sentenced today by Senior United States District Court Judge John M. Gerrard to 24 months’ imprisonment. Brown’s sentence follows his conviction for being an unlawful user of controlled substances who possessed a firearm. Brown was also sentenced to a two-year term of supervised release to be served after he completes his prison sentence. There is no parole in the federal system. Brown pleaded guilty to his offense on June 23, 2023. The indictment against Brown was filed on June 17, 2020. Brown was allowed to be released from custody while his case was pending. One of the conditions of his release required that he stay in contact with the United States Probation Office. At some point after he was allowed to be on pretrial release, Brown absconded, and a warrant was issued for his arrest. Brown was located and arrested on January 5, 2023. At today’s sentencing hearing, Senior Judge Gerrard remarked that Brown’s offense would typically receive an 18-month term of imprisonment. However, because Brown absconded, Judge Gerrard added an additional six months to Brown’s sentence. On April 17, 2020, a person in Lincoln purchased a KelTec rifle from a gun store. Brown later posted a video on Snapchat which depicted him in possession of that rifle. Police executed a search warrant at the home of the person who purchased the firearm. The KelTec rifle was recovered, and it was examined for fingerprints. Two sets of fingerprints were found on the rifle, one of which matched Brown’s fingerprints. At the time when Brown possessed the rifle, he was an unlawful user of marijuana. Between contacts with law enforcement, and postings on social media, evidence was obtained showing Brown in possession of marijuana between July 2018 and May 2020. The investigation was conducted by the Lincoln Police Department’s Gang Unit, which works with the Federal Bureau of Investigation in referring some cases for federal prosecution. The Bureau of Alcohol, Tobacco, Firearms, and Explosives also assisted by helping to trace the origins of the firearm. This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.


title: Muskogee Resident Sentenced For Threatening Communications And Cyberstalking Charges

body_text: MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Parker Ryan Little, age 26, of Muskogee, Oklahoma, was sentenced to 51 months imprisonment for posting threats online against Wagoner Police Officers and a Fort Gibson Police Officer, and for stalking and harassing two additional victims. The charges arose from investigations by the Federal Bureau of Investigation, the California-based Regional Enforcement Allied Computer Team (REACT) Task Force, the Wagoner Police Department, and the Fort Gibson Police Department. On June 22, 2022, Little pleaded guilty to two counts of Threatening Interstate Communications and two counts of Stalking. On May 4, 2020, Little used one acquaintance’s identity to send an anonymous tip to the Fort Gibson Police Department threatening a mass shooting. On May 8, 2020, Little, assuming the same victim’s identity, posted a public message on a gaming forum threatening to shoot several Fort Gibson police officers, and posted personal identifiable information (PII) doxing the officers. The threatening messages were observed and reported to law enforcement by individuals located outside of Oklahoma. On June 11, 2020, Little discussed the harassment of a second acquaintance in a group internet conversation. In the group conversation, Little admitted to harassing that second victim, including swatting the victim’s house. On the same day, Little posed as the second victim and posted a public message on a gaming forum threatening to shoot six Wagoner Police Department Officers, including the Chief of Police, the Deputy Chief, and four others. At the same time, Little posted personally identifiable information in the same public message, doxing the threatened Wagoner police officers. The threatening messages involving the second victim were also observed and reported to law enforcement by individuals located outside of Oklahoma. “The defendant’s relentless campaign of online threats, harassment, and stalking intended to instill fear and divert critical law enforcement resources from where they are truly needed,” said FBI Oklahoma City Special Agent in Charge Edward J. Gray. “Our hope is that today’s sentence brings some relief to the private citizens and members of the law enforcement community that were affected by this reprehensible behavior.” “We live in an increasingly interconnected society, which can be either a blessing or a curse,” said United States Attorney Christopher J. Wilson. “In this case, the defendant chose the latter, utilizing various electronic platforms to spew threats and stalk innocent victims, including members of law enforcement. The sentence imposed sends a clear message this type conduct is criminal and will be punished accordingly.” The Honorable John F. Heil, U.S. District Judge in the United States District Court for the Eastern District of Oklahoma, presided over the hearings in Muskogee, Oklahoma. Little will remain in the custody of the U.S. Marshal pending transportation to a designated United States Bureau of Prisons facility to serve a non-paroleable sentence of incarceration. Assistant United States Attorney Benjamin D. Traster represented the United States.


title: UNITED STATES REACHES $37 MILLION SETTLEMENT OF FRAUD LAWSUIT AGAINST CIGNA FOR SUBMITTING FALSE AND INVALID DIAGNOSIS CODES TO ARTIFICIALLY INFLATE ITS MEDICARE ADVANTAGE PAYMENTS

component: USAO - Tennessee, Middle

body_text: NASHVILLE – Henry C. Leventis, the United States Attorney for the Middle District of Tennessee, Damian Williams, the United States Attorney for the Southern District of New York, and Naomi Gruchacz, the Special Agent in Charge of the New York Office of the U.S. Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), announced today that the United States has settled a civil healthcare fraud lawsuit against THE CIGNA GROUP and its subsidiary Medicare Advantage Organizations (collectively, “CIGNA”). The $37 million settlement resolves claims that CIGNA submitted to the Government false and invalid patient diagnosis codes to artificially inflate the payments CIGNA received for providing insurance coverage to its Medicare Advantage plan members. The lawsuit was originally filed by a whistleblower in the U.S. District Court for the Southern District of New York and later transferred to the Middle District of Tennessee. The Government’s Complaint alleged that the invalid diagnosis codes were based solely on forms completed by vendors retained and paid by CIGNA to conduct in-home assessments of plan members. The healthcare providers (typically nurse practitioners) who conducted these home visits did not perform or order the diagnostic testing or imaging that would have been necessary to reliably diagnose the serious, complex conditions reported and were in many cases prohibited by CIGNA from providing any treatment during the home visits for the medical conditions they purportedly found. The diagnoses at issue were not supported by the information documented on the forms completed by the vendors and were not reported to CIGNA by any other healthcare provider who saw the patient during the year in which the home visits occurred. Nevertheless, CIGNA submitted these diagnoses to the Government to claim increased payments, and falsely certified each year that the diagnosis data it submitted was “accurate, complete, and truthful.” As part of the settlement approved yesterday by U.S. District Judge Eli Richardson CIGNA will pay the United States a total of $37 million. CIGNA also made extensive factual admissions in the settlement regarding the conduct alleged in the Government’s Complaint. In connection with this settlement, CIGNA entered into a five-year Corporate Integrity Agreement (“CIA”) with HHS-OIG. The CIA requires CIGNA to implement numerous accountability and auditing measures. In particular, CIGNA must conduct annual risk assessments and other monitoring, and an independent review organization will conduct multi-faceted audits focused on risk adjustment data. In separate settlements announced today by the Civil Division of the Department of Justice and the U.S. Attorney’s Office for the Eastern District of Pennsylvania, CIGNA is also agreeing to resolve separate allegations that CIGNA submitted invalid beneficiary diagnoses to inflate Medicare Advantage payments. “Medicare Advantage relies on the integrity of its insurers and the accuracy of the diagnosis code information they provide, since it has an outsize effect on Medicare payments,” said Henry C. Leventis, United States Attorney for the Middle District of Tennessee. “We will continue to vigorously pursue fraud in this increasingly important program.” U.S. Attorney Damian Williams for the Southern District of New York said: “For years, Cigna submitted to the Government false and invalid diagnosis information for its Medicare Advantage plan members. The reported diagnoses of serious and complex conditions were based solely on cursory in-home assessments by providers who did not perform necessary diagnostic testing and imaging. Cigna knew that these diagnoses would increase its Medicare Advantage payments by making its plan members appear sicker. This Office is committed to holding insurers accountable if they seek to manipulate the Medicare Advantage Program and boost their profits by submitting false information to the Government.” “Managed care plans’ primary responsibility is to ensure the health coordination and appropriate benefits for the beneficiaries they have enrolled, not focus on profits,” stated Special Agent in Charge Naomi Gruchacz with the U.S. Department of Health and Human Services Office of Inspector General. “HHS-OIG will work with our partners at the U.S. Attorney’s Office to ensure the integrity of federal healthcare program funds and the provision of appropriate, quality services to patients.” Medicare Advantage, also known as the Medicare Part C program, provides health insurance coverage for tens of millions of Americans who opt out of traditional Medicare. Under Medicare Part C, Medicare Advantage Organizations (“MAOs”), typically operated by private insurers like CIGNA, provide coverage for Medicare Advantage plan members. In return, MAOs receive monthly payments from the Centers for Medicare and Medicaid Services (“CMS”) that vary based on each member’s demographic information and medical diagnoses. MAOs submit diagnoses for their plan members, usually provided by the plan members’ healthcare providers, to CMS. CMS then uses those diagnoses, along with demographic factors, to calculate a “risk score” for each member and, in turn, the amount of the monthly payment it will pay the MAO for covering that member. The Medicare Advantage payment model is intended to pay MAOs more to cover healthcare expenses for sicker plan members (who are expected to incur higher healthcare costs) and less for healthier plan members (who are expected to incur lower costs). As alleged in the Government’s Complaint: CIGNA, through its subsidiaries and affiliates, owns and operates numerous MAOs that administer Medicare Advantage Plans. CIGNA contracted with several vendors to conduct home visits of Medicare Advantage plan members across the country as part of its broader so-called “360 comprehensive assessment” program. The home visits were typically conducted by nurse practitioners and, on occasion, by other non-physician healthcare providers such as registered nurses and physician assistants (the “Vendor HCPs”). Based on the visit, the Vendor HCPs completed a CIGNA-created form (“360 form”) that included a check-the-box multi-page list of a wide range of medical conditions. CIGNA had its coding teams identify diagnosis codes that corresponded to the recorded medical conditions and then submitted those to CMS for risk adjustment payment purposes. CIGNA structured the 360 home visits for the primary purpose of capturing and recording lucrative diagnosis codes that would significantly increase the monthly capitated payments it received from CMS. The purpose of the visits was not to treat patients’ medical conditions, and CIGNA explicitly prohibited the Vendor HCPs from providing actual patient treatment or care. As CIGNA acknowledged in an internal document discussing the program, “[t]the primary goal of a 360 visit is administrative code capture and not chronic care or acute care management.” But this was not disclosed to CIGNA’s plan members when the home visit was scheduled or during the actual visit. When identifying plan members to receive home visits, CIGNA targeted individuals who were likely to yield the greatest risk score increases and thus the greatest increased payment. The Vendor HCPs spent limited time with the patients and did not conduct a comprehensive physical examination. When completing the assessments and recording the diagnoses, the Vendor HCPs relied largely on the patient’s own self-assessment and their responses to various basic screening questions. Vendor HCPs did not have access to the patient’s full medical history and typically did not obtain or review relevant records from the patient’s primary care physician in advance of the visit. CIGNA’s 360 home visit program regularly generated false and invalid diagnosis codes for certain serious, complex conditions that cannot be reliably diagnosed in a home setting and without extensive diagnostic testing or imaging. In tens of thousands of instances, CIGNA submitted diagnosis codes that represent serious, complex medical conditions that (i) were based only on the home visits conducted by the Vendor HCPs; (ii) require specific testing or imaging to be reliably diagnosed, which was not performed; (iii) were not supported by the information documented on the 360 form completed by the Vendor HCPs; and (iv) were not reported by any other healthcare provider who saw the plan member during the year in which the home visit occurred (the "Invalid Diagnoses"). The Invalid Diagnoses included, but are not limited to, diagnoses for complex medical conditions such as chronic kidney disease, congestive heart failure, rheumatoid arthritis, and diabetes with renal complications. According to CIGNA’s own clinical guidelines, accurately diagnosing these conditions requires specialized testing. CIGNA exerted pressure on Vendor HCPs to record high-value diagnoses that significantly increased risk adjustment payments. CIGNA management identified at least 12 classes of generic chronic diagnoses that they thought were “often underdiagnosed” among its Plan members and, through trainings and seminars, encouraged the Vendor HCPs to make these diagnoses during the home visits. CIGNA also closely tracked the volume and nature of the diagnoses generated by each vendor’s home visits, as well as how the diagnoses affected risk-adjusted payments. CIGNA provided trainings to vendors to improve their “performance” when they failed to deliver the expected level of high-value diagnosis codes. Indeed, CIGNA tracked the return on investment of the 360 home visit program by comparing the costs of the in-home visits ( i.e. , payments to vendors) against the additional Part C payments generated by increased risk scores. For example, according to an internal report, CIGNA determined that, during the first nine months of 2014, one vendor’s 6,658 in-home visits resulted in more than an additional $14 million in Medicare payments, which dwarfed the approximately $2.13 million that CIGNA paid to the vendor. When specific providers were found to have captured fewer diagnoses than expected, CIGNA asked the vendor to prepare a “performance improvement plan” for the provider. The Invalid Diagnoses generated by the 360 home visits also did not conform with the International Classification of Diseases (“ICD”) Office Guidelines for Coding and Reporting (the “ICD Guidelines”), as required by applicable federal regulations. The Invalid Diagnoses did not affect patient care, treatment, or management during the home visit, as required under the ICD Guidelines, and thus were ineligible for risk adjustment. In addition, the Invalid Diagnoses were not supported by the minimal information recorded on the 360 forms, in violation of the ICD Guidelines’ medical record documentation requirement. In fact, in some cases, the 360 forms include clinical exam findings that contradict the supposed diagnosis. For example, one patient received a congestive heart failure diagnosis from a home visit even though the 360 form explicitly noted that physical exam results found her heart to be “regular” and “normal,” and stated, “cardiac reviewed and unremarkable.” As part of the settlement, CIGNA admitted and accepted responsibility for certain conduct alleged by the Government including the following: As part of the 360 Program, CIGNA contracted with vendors who employed nurse practitioners or other licensed healthcare providers to conduct assessments of Part C members in their homes. The vendor healthcare providers, among other things, performed physical exams and documented diagnostic information on standardized forms provided or approved by CIGNA but in many cases were not permitted to provide treatment or prescriptions for medications. CIGNA’s medical coding team reviewed the completed “360” forms and, based on that review, identified diagnosis codes that corresponded to the medical conditions checked off on the forms, which were then submitted to CMS as part of CIGNA’s risk adjustment data. The forms utilized by CIGNA’s vendors listed a wide range of diagnoses, including complex medical conditions. CIGNA tracked the volume and nature of the diagnoses generated by vendors’ home visits. CIGNA also tracked how the diagnoses affected risk-adjusted payments. According to diagnostic criteria disseminated by CIGNA to the vendors, the clinical assessment of some of these diagnoses relies on laboratory evaluation, diagnostic imaging, or other diagnostic testing when making a particular diagnosis for the first time. In many cases, CIGNA did not require 360 Program vendors conducting in-home assessments to have the equipment available to conduct such laboratory testing, imaging, or other diagnostic testing when diagnosing these conditions. In thousands of instances, the in-home assessments conducted by 360 Program vendors resulted in diagnoses of CIGNA members and the submission to CMS of resulting risk-adjusting diagnosis codes that had not been previously reported to CMS by CIGNA from any other encounter with a healthcare provider during the year in which the home visit occurred. Based on the in-home assessments of members completed by vendors pursuant to the 360 Program, in many instances, CIGNA reported to CMS diagnoses for Medicare Advantage Plan members where the 360 forms did not include clinical information that corroborated the diagnoses and did not reflect that the diagnostic testing necessary to make the diagnosis for the first time had been performed. This case is being handled by Assistant U.S. Attorney Ellen Bowden McIntyre of the Middle District of Tennessee and Assistant U.S. Attorneys Jeffrey Powell, Peter Aronoff, Jean-David Barnea, and Samuel Dolinger of the Civil Frauds Unit within the U.S. Attorney’s Office for the Southern District of New York. # # # # #


title: U.S. Attorney's Office For The Eastern District Of Tennessee Announces Over $4 Million In Department Of Justice Programs Grant Funding

component: USAO - Tennessee, Eastern

body_text: KNOXVLLE, Tenn. On September 28, 2023, the United States Attorney’s Office for the Eastern District of Tennessee announced $4,684,929 in Department of Justice, Office of Justice Programs (OJP) funding. City of Chattanooga - $500.000. City of Knoxville - $2,000,000. City of Sevierville - $299,600. Hamilton County Board of Education - $994,679. Knoxville Leadership Foundation - $750,000. Metro Moore County Emergency Management Agency - $140,650. The Office of Justice Programs is a federal agency that provides federal leadership, grants, training, technical assistance, and other resources to improve the nation’s capacity to prevent and reduce crime, assist victims and uphold the rule of law by strengthening the criminal and juvenile justice systems. OJP’s six program offices support state, local, and tribal community safety efforts; crime victim assistance and compensation programs; juvenile justice and child protection activities; sex offender management; a wide range of training and technical assistance opportunities; ground-breaking criminal justice research; and statistical collections covering a host of justice system topics. The awards announced above are being made as part of the regular end-of-fiscal year cycle. Additional information about FY23 awards can be found on OJP’s website here: www.ojp.gov/funding/explore/ojp-award-data . For more information, please contact ojpcongressional@ojp.usdoj.gov . ###


title: United States Reaches $37 Million Settlement Of Fraud Lawsuit Against Cigna For Submitting False And Invalid Diagnosis Codes To Artificially Inflate Its Medicare Advantage Payments

component: USAO - New York, Southern

body_text: Damian Williams, the United States Attorney for the Southern District of New York, Henry C. Leventis, the United States Attorney for the Middle District of Tennessee, and Naomi Gruchacz, the Special Agent in Charge of the New York Office of the U.S. Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), announced today that the United States has settled a civil healthcare fraud lawsuit against THE CIGNA GROUP and its subsidiary Medicare Advantage Organizations (collectively, “CIGNA”). The $37 million settlement resolves claims that CIGNA submitted to the Government false and invalid patient diagnosis codes to artificially inflate the payments CIGNA received for providing insurance coverage to its Medicare Advantage plan members. The lawsuit was originally filed by a whistleblower in the U.S. District Court for the Southern District of New York and later transferred to the Middle District of Tennessee. The Government’s Complaint alleged that the invalid diagnosis codes were based solely on forms completed by vendors retained and paid by CIGNA to conduct in-home assessments of plan members. The healthcare providers (typically nurse practitioners) who conducted these home visits did not perform or order the diagnostic testing or imaging that would have been necessary to reliably diagnose the serious, complex conditions reported and were in many cases prohibited by CIGNA from providing any treatment during the home visits for the medical conditions they purportedly found. The diagnoses at issue were not supported by the information documented on the forms completed by the vendors and were not reported to CIGNA by any other healthcare provider who saw the patient during the year in which the home visits occurred. Nevertheless, CIGNA submitted these diagnoses to the Government to claim increased payments and falsely certified each year that the diagnosis data it submitted was “accurate, complete, and truthful.” As part of the settlement approved by U.S. District Judge Eli Richardson, CIGNA will pay the United States a total of $37 million. CIGNA also made extensive factual admissions in the settlement regarding the conduct alleged in the Government’s Complaint. In connection with this settlement, CIGNA entered into a five-year Corporate Integrity Agreement (“CIA”) with HHS-OIG. The CIA requires CIGNA to implement numerous accountability and auditing measures. In particular, CIGNA must conduct annual risk assessments and other monitoring, and an independent review organization will conduct multi-faceted audits focused on risk adjustment data. U.S. Attorney Damian Williams said: “For years, Cigna submitted to the Government false and invalid diagnosis information for its Medicare Advantage plan members. The reported diagnoses of serious and complex conditions were based solely on cursory in-home assessments by providers who did not perform necessary diagnostic testing and imaging. Cigna knew that these diagnoses would increase its Medicare Advantage payments by making its plan members appear sicker. This Office is committed to holding insurers accountable if they seek to manipulate the Medicare Advantage Program and boost their profits by submitting false information to the Government.” U.S. Attorney for the Middle District of Tennessee Henry C. Leventis said: “Medicare Advantage relies on the integrity of its insurers and the accuracy of the diagnosis code information they provide, since it has an outsize effect on Medicare payments. We will continue to vigorously pursue fraud in this increasingly important program.” HHS-OIG Special Agent in Charge Naomi Gruchacz said: “Managed care plans’ primary responsibility is to ensure the health coordination and appropriate benefits for the beneficiaries they have enrolled, not focus on profits. HHS-OIG will work with our partners at the U.S. Attorney’s Office to ensure the integrity of federal healthcare program funds and the provision of appropriate, quality services to patients.” Medicare Advantage, also known as the Medicare Part C program, provides health insurance coverage for tens of millions of Americans who opt out of traditional Medicare. Under Medicare Part C, Medicare Advantage Organizations (“MAOs”), typically operated by private insurers like CIGNA, provide coverage for Medicare Advantage plan members. In return, MAOs receive monthly payments from the Centers for Medicare and Medicaid Services (“CMS”) that vary based on each member’s demographic information and medical diagnoses. MAOs submit diagnoses for their plan members, usually provided by the plan members’ healthcare providers, to CMS. CMS then uses those diagnoses, along with demographic factors, to calculate a “risk score” for each member and, in turn, the amount of the monthly payment it will pay the MAO for covering that member. The Medicare Advantage payment model is intended to pay MAOs more to cover healthcare expenses for sicker plan members (who are expected to incur higher healthcare costs) and less for healthier plan members (who are expected to incur lower costs). As alleged in the Government’s Complaint: CIGNA, through its subsidiaries and affiliates, owns and operates numerous MAOs that administer Medicare Advantage Plans. CIGNA contracted with several vendors to conduct home visits of Medicare Advantage plan members across the country as part of its broader so-called “360 comprehensive assessment” program. The home visits were typically conducted by nurse practitioners and, on occasion, by other non-physician healthcare providers such as registered nurses and physician assistants (the “Vendor HCPs”). Based on the visit, the Vendor HCPs completed a CIGNA-created form (“360 form”) that included a check-the-box multi-page list of a wide range of medical conditions. CIGNA had its coding teams identify diagnosis codes that corresponded to the recorded medical conditions and then submitted those to CMS for risk adjustment payment purposes. CIGNA structured the 360 home visits for the primary purpose of capturing and recording lucrative diagnosis codes that would significantly increase the monthly capitated payments it received from CMS. The purpose of the visits was not to treat patients’ medical conditions, and CIGNA explicitly prohibited the Vendor HCPs from providing actual patient treatment or care. As CIGNA acknowledged in an internal document discussing the program, “[t]the primary goal of a 360 visit is administrative code capture and not chronic care or acute care management.” But this was not disclosed to CIGNA’s plan members when the home visit was scheduled or during the actual visit. When identifying plan members to receive home visits, CIGNA targeted individuals who were likely to yield the greatest risk score increases and thus the greatest increased payment. The Vendor HCPs spent limited time with the patients and did not conduct a comprehensive physical examination. When completing the assessments and recording the diagnoses, the Vendor HCPs relied largely on the patient’s own self-assessment and their responses to various basic screening questions. Vendor HCPs did not have access to the patient’s full medical history and typically did not obtain or review relevant records from the patient’s primary care physician in advance of the visit. CIGNA’s 360 home visit program regularly generated false and invalid diagnosis codes for certain serious, complex conditions that cannot be reliably diagnosed in a home setting and without extensive diagnostic testing or imaging. In tens of thousands of instances, CIGNA submitted diagnosis codes that represent serious, complex medical conditions that (i) were based only on the home visits conducted by the Vendor HCPs; (ii) required specific testing or imaging to be reliably diagnosed, which was not performed; (iii) were not supported by the information documented on the 360 form completed by the Vendor HCPs; and (iv) were not reported by any other healthcare provider who saw the plan member during the year in which the home visit occurred (the “Invalid Diagnoses”). The Invalid Diagnoses included, but are not limited to, diagnoses for complex medical conditions such as chronic kidney disease, congestive heart failure, rheumatoid arthritis, and diabetes with renal complications. According to CIGNA’s own clinical guidelines, accurately diagnosing these conditions requires specialized testing. CIGNA exerted pressure on Vendor HCPs to record high-value diagnoses that significantly increased risk adjustment payments. CIGNA management identified at least 12 classes of generic chronic diagnoses that they thought were “often underdiagnosed” among its Plan members and, through trainings and seminars, encouraged the Vendor HCPs to make these diagnoses during the home visits. CIGNA also closely tracked the volume and nature of the diagnoses generated by each vendor’s home visits, as well as how the diagnoses affected risk-adjusted payments. CIGNA provided trainings to vendors to improve their “performance” when they failed to deliver the expected level of high-value diagnosis codes. The Invalid Diagnoses generated by the 360 home visits also did not conform with the International Classification of Diseases (“ICD”) Official Guidelines for Coding and Reporting (the “ICD Guidelines”), as required by applicable federal regulations. The Invalid Diagnoses did not affect patient care, treatment, or management during the home visit, as required under the ICD Guidelines, and thus were ineligible for risk adjustment. In addition, the Invalid Diagnoses were not supported by the minimal information recorded on the 360 forms, in violation of the ICD Guidelines’ medical record documentation requirement. In fact, in some cases, the 360 forms include clinical exam findings that contradict the supposed diagnosis. For example, one patient received a congestive heart failure diagnosis from a home visit even though the 360 form explicitly noted that physical exam results found her heart to be “regular” and “normal,” and stated, “cardiac reviewed and unremarkable.” As part of the settlement, CIGNA admitted and accepted responsibility for certain conduct alleged by the Government including the following: As part of the 360 Program, CIGNA contracted with vendors who employed nurse practitioners or other licensed healthcare providers to conduct assessments of Part C members in their homes. The vendor healthcare providers, among other things, performed physical exams and documented diagnostic information on standardized forms provided or approved by CIGNA but in many cases were not permitted to provide treatment or prescriptions for medications. CIGNA’s medical coding team reviewed the completed “360” forms and, based on that review, identified diagnosis codes that corresponded to the medical conditions checked off on the forms, which were then submitted to CMS as part of CIGNA’s risk adjustment data. The forms utilized by CIGNA’s vendors listed a wide range of diagnoses, including complex medical conditions. CIGNA tracked the volume and nature of the diagnoses generated by vendors’ home visits. CIGNA also tracked how the diagnoses affected risk-adjusted payments. According to diagnostic criteria disseminated by CIGNA to the vendors, the clinical assessment of some of these diagnoses relies on laboratory evaluation, diagnostic imaging, or other diagnostic testing when making a particular diagnosis for the first time. In many cases, CIGNA did not require 360 Program vendors conducting in-home assessments to have the equipment available to conduct such laboratory testing, imaging, or other diagnostic testing when diagnosing these conditions. In thousands of instances, the in-home assessments conducted by 360 Program vendors resulted in diagnoses of CIGNA members and the submission to CMS of resulting risk-adjusting diagnosis codes that had not been previously reported to CMS by CIGNA from any other encounter with a healthcare provider during the year in which the home visit occurred. Based on the in-home assessments of members completed by vendors pursuant to the 360 Program, in many instances, CIGNA reported to CMS diagnoses for Medicare Advantage Plan members where the 360 forms did not include clinical information that corroborated the diagnoses and did not reflect that the diagnostic testing necessary to make the diagnosis for the first time had been performed. In separate settlements announced today by the Civil Division of the Department of Justice and the U.S. Attorney’s Office for the Eastern District of Pennsylvania, CIGNA is also agreeing to resolve separate allegations that CIGNA submitted invalid beneficiary diagnoses to inflate Medicare Advantage payments that did not arise from CIGNA’s home visit program. * * * Mr. Williams thanked HHS-OIG and the U.S. Attorney’s Office for the Middle District of Tennessee for their assistance with this case. This case is being handled by the Civil Frauds Unit within the U.S. Attorney’s Office for the Southern District of New York. Assistant U.S. Attorneys Jeffrey Powell, Peter Aronoff, Jean-David Barnea, and Samuel Dolinger are in charge of the case, with the assistance of Assistant U.S. Attorney Ellen Bowden McIntyre of the Middle District of Tennessee.


title: Cigna Group to Pay $172 Million to Resolve False Claims Act Allegations

component: USAO - Pennsylvania, Eastern

body_text: PHILADELPHIA– United States Attorney Jacqueline C. Romero announced that the Cigna Group (“Cigna”), a national insurer with corporate offices in Philadelphia, has agreed to pay $172,294,350 to resolve allegations that it violated the civil False Claims Act by submitting and failing to withdraw inaccurate and untruthful diagnosis codes for its Medicare Advantage Plan enrollees in order to increase its payments from Medicare. Of this amount, Cigna will pay $135,294,350 to resolve allegations arising from an investigation based out of the Eastern District of Pennsylvania. “Given the growth of Medicare Advantage plans, investigating fraud involving Medicare Part C is more important than ever. My office has prioritized combatting Medicare Advantage fraud, including applying data-driven investigative methods and working extensively with our law enforcement partners across the country,” said U.S. Attorney Jacqueline C. Romero of the Eastern District of Pennsylvania. “We will hold accountable those who report unsupported diagnoses to inflate Medicare Advantage payment, such as unsupported diagnosis codes for morbid obesity.” Indeed, earlier this year, this office announced another Medicare Advantage settlement in a different case: https://www.justice.gov/usao-edpa/pr/primary-care-physicians-pay-15-million-resolve-false-claims-act-liability-submitting . Under the Medicare Advantage (“MA”) Program, also known as Medicare Part C, Medicare beneficiaries have the option of obtaining their Medicare-covered benefits through private insurance plans called MA Plans. Over half of our nation’s Medicare beneficiaries are now enrolled in MA Plans, and the government pays private insurers over $450 billion each year to provide for their care. The Centers for Medicare and Medicaid Services (“CMS”) pays the MA Plans a fixed monthly amount for each beneficiary who enrolls. CMS adjusts these monthly payments to account for various “risk” factors that affect expected health expenditures for the beneficiary, to ensure that MA Plans are paid more for those beneficiaries expected to incur higher healthcare costs and less for healthier beneficiaries expected to incur lower costs. To make these adjustments, CMS collects “risk adjustment” data, including medical diagnosis codes, from the MA Plans. Cigna owns and operates MA Organizations that offer MA Plans to beneficiaries across the country. The United States alleges that Cigna submitted inaccurate and untruthful patient diagnosis data to CMS in order to inflate the payments it received from CMS, failed to withdraw the inaccurate and untruthful diagnosis data and repay CMS, and falsely certified in writing to CMS that the data was accurate and truthful. The settlement announced today resolves these allegations. The United States contends that, for payment years 2014 to 2019, Cigna operated a “chart review” program, pursuant to which it retrieved medical records (also known as “charts”) from healthcare providers documenting services they had previously rendered to Medicare beneficiaries enrolled in Cigna’s plans. Cigna retained diagnosis coders to review those charts to identify all medical conditions that the charts supported and to assign the beneficiaries diagnosis codes for those conditions. Cigna relied on the results of those chart reviews to submit additional diagnosis codes to CMS that the healthcare providers had not reported for the beneficiaries to obtain additional payments from CMS. However, Cigna’s chart reviews also did not substantiate some diagnosis codes that were reported by providers and previously submitted by Cigna to CMS. Cigna did not delete or withdraw these inaccurate and untruthful diagnosis codes, however, which would have required Cigna to reimburse CMS. Thus, the United States alleges that Cigna used the results of its chart reviews to identify instances where Cigna could seek additional payments from CMS, while improperly failing to use those same results when they provided information about instances where Cigna was overpaid. The United States further contends that, for payment years 2016 to 2021, Cigna knowingly submitted and/or failed to delete or withdraw inaccurate and untruthful diagnosis codes for morbid obesity to increase the payments it received from CMS for numerous beneficiaries enrolled in its MA plans. The medical records for individuals diagnosed as morbidly obese typically include one or more Body Mass Index (“BMI”) recordings. Individuals with a BMI below 35 cannot properly be diagnosed as morbidly obese. However, Cigna submitted or failed to delete inaccurate and untruthful diagnosis codes for morbid obesity for individuals lacking a BMI of 35 or above, and these codes increased the payments made by CMS. In connection with the settlement, Cigna entered into a five-year Corporate Integrity Agreement (“CIA”) with the U.S. Department of Health and Human Services Office of Inspector General (“HHS-OIG”). The CIA requires that Cigna implement numerous accountability and auditing provisions. On an annual basis, top executives and members of the Board of Directors must make certifications about Cigna’s compliance measures, Cigna must conduct annual risk assessments and other monitoring, and an independent review organization will conduct multi-faceted audits focused on risk adjustment data. “Today’s settlement shows our attention to and commitment in investigating all potential allegations of fraud against the Medicare Part C Program, no matter the complexity of the scheme,” said Maureen R. Dixon, Special Agent in Charge for HHS-OIG, Region III. “We will continue to partner with the United States Attorney’s Office to evaluate allegations brought under the False Claims Act to ensure the integrity of federal healthcare programs.” The matter was handled in the Eastern District of Pennsylvania by Assistant U.S. Attorneys Deborah W. Frey and Matthew E. K. Howatt, Civil Chief Gregory B. David, auditor George Niedzwicki, and litigative consultants Lauren M. Cordrey and Priscilla Brandon, along with Civil Fraud Section attorney Carol L. Wallack and Assistant Director, Edward C. Crooke. HHS-OIG supported the investigation. The remaining $37 million of the aggregate settlement amount above resolves allegations related to unsupported diagnoses for MA beneficiaries arising from Cigna’s home visit program. That separate settlement resolves claims brought under the qui tam or whistleblower provisions of the False Claims Act. That case is captioned United States ex rel. Cutler v. Cigna Corp., et al. , No. 3:21-cv-00748 (M.D. Tenn.), which case was transferred from the Southern District of New York. The investigation and resolution of this matter illustrate the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement, can be reported to the Department of Health and Human Services at https://oig.hhs.gov/fraud/report-fraud/ or 800-HHS-TIPS (800-447-8477). The claims resolved by the settlement are allegations only and there has been no determination of liability.


title: United States Settles Kickback Allegations with Specialty Pharmacy BioTek reMEDys, Inc., its Owner Chaitanya Gadde, and Dr. David Tabby

body_text: PHILADELPHIA – United States Attorney Jacqueline C. Romero announced today that BioTek reMEDys, Inc. (“BioTek”), located in New Castle, Delaware, and its Chief Executive Officer, Chaitanya Gadde, have agreed to pay $20 million based on BioTek’s ability to pay to resolve allegations that they violated the False Claims Act and the Anti-Kickback Statute by paying kickbacks to patients in the form of routinely waived copayments and to physicians in exchange for providing patient referrals to BioTek. The government alleged that, from at least August 2015 through May 2020, BioTek, a specialty pharmacy that offers drugs and infusion services, routinely waived the copayments of Medicare and TRICARE patients to induce those patients to purchase its drugs and services. Many of the specialty drugs offered by BioTek were expensive and required patients to pay large copays. Understanding that these copays could deter patients from purchasing its drugs and services, the government alleged that BioTek engaged in a scheme, orchestrated and implemented by Gadde and others, to routinely waive these copays – without regard for whether the patients were experiencing financial hardship – to ensure a steady revenue stream for BioTek. Today’s settlement also resolves allegations that BioTek provided remuneration in the form of gifts, dinners, and free administrative and clinical support services, to physicians – in particular, Dr. David Tabby, who operated a neurology practice in Bala Cynwyd, Pennsylvania – to induce those physicians to refer patients to BioTek. The government also alleged that Dr. Tabby knowingly solicited and accepted this remuneration in exchange for referring numerous patients to BioTek. Dr. Tabby has paid $480,000 to settle these allegations, based on his ability to pay. When a Medicare beneficiary obtains a prescription drug covered by Medicare, the beneficiary may be required to make a partial payment, which may take the form of a copayment, coinsurance, or a deductible (collectively “copays”). Congress included copay requirements in the Medicare program in part to serve as a check on health care costs. The Federal Anti-Kickback Statute prohibits the offering, paying, soliciting, or accepting, directly or indirectly, any remuneration – which includes money or any other thing of value – to refer or arrange for the referral of items or services payable by any federal health care program. This prohibition extends to companies that routinely waive the copays of Medicare patients without determination of financial need. The Anti-Kickback Statute also extends to the payment of remuneration to physicians in exchange for patient referrals. “BioTek allegedly provided improper physician inducements and covered up kickbacks for patient referrals by waiving co-pays,” said United States Attorney Jacqueline C. Romero. “These improper and corrupt business practices will not be tolerated in this District. Biotek’s alleged scheme, orchestrated and implemented by Gadde, Dr. Tabby, and others, to routinely waive these copays – without regard for whether the patients were experiencing financial hardship – ensured a steady revenue stream for BioTek and undermined patient care to citizens of this District. This Office will continue to invest itself in the pursuit of health care providers who violate the law for personal gain.” “Kickbacks impose hidden costs on the health care system and compromise medical decision-making,” said Maureen R. Dixon, Special Agent in Charge with the U.S. Department of Health and Human Services Office of the Inspector General. “Alongside our law enforcement partners, HHS-OIG is committed to safeguarding the integrity of federal health care programs by, in part, holding individuals who unlawfully bill the programs accountable for their actions." “The settlement agreement announced today demonstrates our ongoing commitment to work with our law enforcement partners to investigate healthcare fraud and protect TRICARE, the healthcare system for military members and their dependents,” stated Special Agent in Charge Patrick J. Hegarty of the Defense Criminal Investigative Service Northeast Field Office. “When health care companies pay physicians and submit false claims for improper referrals, they undermine the integrity of TRICARE and place an unnecessary financial burden on the program.” The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Shantae M. Wyatt and Latoya Sparrow, former BioTek employees. Under those provisions, a private party may file an action on behalf of the United States and receive a portion of any recovery. Wyatt and Sparrow will receive $4 million as their share of the settlement with BioTek and Gadde, and $91,200 as their share of the settlement with Dr. Tabby. The qui tam case is captioned United States of America ex rel. Wyatt et al. v. BioTek reMEDys, Inc. , No. 19-6069 (E.D. Pa.). The relators are represented by David Bocian, Esq. and Asher Alavi, Esq. of Kessler Topaz Meltzer & Check, LLP. The resolutions obtained in this matter were the result of a coordinated effort among the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, the United States Attorney’s Office for the Eastern District of Pennsylvania, the United States Attorney’s Office for the District of Delaware, the U.S. Department of Health and Human Services Office of the Inspector General, the Office of Inspector General for the Office of Personnel Management, and the Department of Defense Office of Inspector General, Defense Criminal Investigative Service. The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800‑HHS‑TIPS (800-447-8477). The matter was handled in the U.S. Attorney’s Office for the Eastern District of Pennsylvania by United States Attorney Jacqueline C. Romero, Deputy Chief Charlene Keller Fullmer, Assistant United States Attorney Judith Amorosa, and Auditor George Niedzwicki . The claims asserted by the United States are allegations only and there has been no determination of liability.


component: Civil Division

body_text: The Cigna Group, headquartered in Connecticut, has agreed to pay $172,294,350 to resolve allegations that it violated the False Claims Act by submitting and failing to withdraw inaccurate and untruthful diagnosis codes for its Medicare Advantage Plan enrollees in order to increase its payments from Medicare. Under the Medicare Advantage (MA) Program, also known as Medicare Part C, Medicare beneficiaries have the option of obtaining their Medicare-covered benefits through private insurance plans called MA Plans. The Centers for Medicare and Medicaid Services (CMS) pays the MA Plans a fixed monthly amount for each beneficiary who enrolls. CMS adjusts these monthly payments to account for various “risk” factors that affect expected health expenditures for the beneficiary, to ensure that MA Plans are paid more for those beneficiaries expected to incur higher healthcare costs and less for healthier beneficiaries expected to incur lower costs. To make these adjustments, CMS collects “risk adjustment” data, including medical diagnosis codes, from the MA Plans. Cigna owns and operates MA Organizations that offer MA Plans to beneficiaries across the country. The United States alleged that Cigna submitted inaccurate and untruthful patient diagnosis data to CMS in order to inflate the payments it received from CMS, failed to withdraw the inaccurate and untruthful diagnosis data and repay CMS, and falsely certified in writing to CMS that the data was accurate and truthful. The settlement announced today resolves these allegations. “Over half of our nation’s Medicare beneficiaries are now enrolled in Medicare Advantage plans, and the government pays private insurers over $450 billion each year to provide for their care,” said Deputy Assistant Attorney General Michael D. Granston of the Justice Department's Civil Division. “We will hold accountable those insurers who knowingly seek inflated Medicare payments by manipulating beneficiary diagnoses or any other applicable requirements.” The United States alleged that, for payment years 2014 to 2019, Cigna operated a “chart review” program, pursuant to which it retrieved medical records (also known as “charts”) from healthcare providers documenting services they had previously rendered to Medicare beneficiaries enrolled in Cigna’s plans. Cigna retained diagnosis coders to review those charts to identify all medical conditions that the charts supported and to assign the beneficiaries diagnosis codes for those conditions. Cigna relied on the results of those chart reviews to submit additional diagnosis codes to CMS that the healthcare providers had not reported for the beneficiaries to obtain additional payments from CMS. However, Cigna’s chart reviews also did not substantiate some diagnosis codes that were reported by providers and previously submitted by Cigna to CMS. Cigna did not delete or withdraw these inaccurate and untruthful diagnosis codes, however, which would have required Cigna to reimburse CMS. Thus, the United States alleged that Cigna used the results of its chart reviews to identify instances where Cigna could seek additional payments from CMS, while improperly failing to use those same results when they provided information about instances where Cigna was overpaid. “Given the growth of Medicare Advantage plans, investigating fraud involving Medicare Part C is more important than ever. My office has prioritized combatting Medicare Advantage fraud, including applying data-driven investigative methods and working extensively with our law enforcement partners across the country,” said U.S. Attorney Jacqueline C. Romero of the Eastern District of Pennsylvania. “We will hold accountable those who report unsupported diagnoses to inflate Medicare Advantage payment, such as unsupported diagnosis codes for morbid obesity.” The United States further alleged that Cigna reported diagnosis codes to CMS that were based solely on forms completed by vendors retained and paid by Cigna to conduct in-home assessments of plan members. The healthcare providers (typically nurse practitioners) who conducted these home visits did not perform or order the diagnostic testing or imaging that would have been necessary to reliably diagnose the serious, complex conditions reported, and were in many cases prohibited by Cigna from providing any treatment during the home visits for the medical conditions they purportedly found. The diagnoses at issue were not supported by the information documented on the forms completed by the vendors and were not reported to Cigna by any other healthcare provider who saw the patient during the year in which the home visit occurred. Nevertheless, Cigna submitted these diagnoses to CMS to claim increased payments, and falsely certified each year that the diagnosis data it submitted was “accurate, complete, and truthful.” “For years, Cigna submitted to the Government false and invalid diagnosis information for its Medicare Advantage plan members. The reported diagnoses of serious and complex conditions were based solely on cursory in-home assessments by providers who did not perform necessary diagnostic testing and imaging. Cigna knew that these diagnoses would increase its Medicare Advantage payments by making its plan members appear sicker,” said Damian Williams, United States Attorney for the Southern District of New York. “This Office is committed to holding insurers accountable if they seek to manipulate the Medicare Advantage Program and boost their profits by submitting false information to the Government.” “Medicare Advantage relies on the integrity of its insurers and the accuracy of the diagnosis code information they provide, since it has an outsize effect on Medicare payments,” said Henry C. Leventis, United States Attorney for the Middle District of Tennessee. “We will continue to vigorously pursue fraud in this increasingly important program.” The United States further alleged that, for payment years 2016 to 2021, Cigna knowingly submitted and/or failed to delete or withdraw inaccurate and untruthful diagnosis codes for morbid obesity to increase the payments it received from CMS for numerous beneficiaries enrolled in its MA plans. The medical records for individuals diagnosed as morbidly obese typically include one or more Body Mass Index (BMI) recordings. Individuals with a BMI below 35 cannot properly be diagnosed as morbidly obese. However, Cigna submitted or failed to delete inaccurate and untruthful diagnosis codes for morbid obesity for individuals lacking a BMI of 35 or above, and these codes increased the payments made by CMS. In connection with the settlement, Cigna entered into a five-year Corporate Integrity Agreement (CIA) with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). The CIA requires that Cigna implement numerous accountability and auditing provisions. On an annual basis, top executives and members of the Board of Directors must make certifications about Cigna’s compliance measures, Cigna must conduct annual risk assessments and other monitoring, and an independent review organization will conduct multi-faceted audits focused on risk adjustment data. “Medicare Advantage plans that submit false information to increase payments from CMS show blatant disregard for the integrity of these vital federal health care funds,” stated Christian J. Schrank, Deputy Inspector General for Investigations with HHS-OIG. “Such actions are an affront to the Medicare program and the millions of patients who rely on its services. Working with our law enforcement partners, our agency will continue to prioritize investigating alleged fraud that targets the Medicare Advantage program.” The civil settlement of the home visit allegations includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Robert A. Cutler, a former part-owner of a vendor retained by Cigna to conduct home visits. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam case is captioned United States ex rel. Cutler v. Cigna Corp., et al. , No. 3:21-cv-00748 (M.D. Tenn.). As part of today’s resolution, Mr. Cutler will receive $8,140,000 from the settlement of the home visit allegations. The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the United States Attorneys’ Offices for the Eastern District of Pennsylvania, the Southern District of New York and the Middle District of Tennessee, with assistance from HHS-OIG. The investigation and resolution of this matter illustrate the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement, can be reported to the Department of Health and Human Services at www.oig.hhs.gov/fraud/report-fraud/ or 800-HHS-TIPS (800-447-8477). The matter was handled by Fraud Section Attorneys Carol Wallack and Edward Crooke and Assistant U.S. Attorneys Deborah Frey, Matthew Howatt and Gregory David from the Eastern District of Pennsylvania, Jeffrey Powell, Peter Aronoff, Jean-David Barnea, and Samuel Dolinger from the Southern District of New York, and Ellen Bowden McIntyre from the Middle District of Tennessee. The claims resolved by the settlement are allegations only and there has been no determination of liability . EDPA Agreement SDNY Settlement


title: Tax Cheat Sentenced to Prison for Failing to Pay Employee Taxes

component: USAO - Arizona

body_text: PHOENIX, Ariz. – James Philip Piccolo, 65, of Scottsdale, Arizona was sentenced on Wednesday to 18 months in prison, followed by three years of supervised release. He also was ordered to pay $651,478 in restitution to the IRS and a $10,000 fine. Piccolo pleaded guilty in January 2023 to one count of failing to pay the IRS federal income taxes withheld from employees. Piccolo co-founded Tecademics, LLC in 2016 and founded IQUP, Inc. in 2017. Both Tecademics and IQUP instructed clients in how to manage online businesses and conduct marketing efforts on the internet. In his plea agreement, Piccolo admitted that he was responsible for submitting any tax payments to the IRS for both companies. Between 2017 and 2018, Piccolo received business tax returns prepared by Tecademics’s and IQUP’s bookkeeper. Those returns reported employees’ wages for each quarter, as well as the portion of the wages withheld by the employer for state and federal taxes. Piccolo admitted that he knew that he was required to pay those taxes to the IRS. For the tax periods between January 2017 and April 2018, however, Piccolo did not pay the taxes owed by Tecademics and IQUP. In total, Piccolo failed to pay $651,478 in taxes to the IRS. “The conviction and sentencing of the defendant are the results of an effort by the Internal Revenue Service to vindicate the rights of honest business owners by holding scofflaws to account,” said U.S. Attorney Gary Restaino. “Instead of following the law, Piccolo breached his employees’ trust by failing to pay the taxes withheld on their behalf.” This case was investigated by the Internal Revenue Service Criminal Investigation. Assistant U.S. Attorney Aron Ketchel, District of Arizona, Phoenix, handled the prosecution. CASE NUMBER: CR-23-0037-JAT RELEASE NUMBER: 2023-145_Piccolo # # # For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/ Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.


title: U.S. Attorney’s Office Joined with Federal Bar Association and Law Schools to Hold Second Annual Sacramento Region Diversity Career Fair

component: USAO - California, Eastern

body_text: SACRAMENTO, Calif. — The second annual Sacramento Region Diversity Career Fair, held on Sept. 30, 2023, connected employers with diverse legal candidates for future and current job openings. The U.S. Attorney’s Office for the Eastern District of California, the University of the Pacific McGeorge School of Law, the UC Davis School of Law, and the Federal Bar Association Sacramento Chapter made the announcement following today’s event. The Diversity Career Fair is the first legal career fair in the Sacramento region with an online platform where employers can post legal jobs and law students and attorneys can submit applications. The Diversity Career Fair grew significantly this year to include 70 participating employers and was expanded to include an interview component. The Diversity Career Fair also provided employers, law students, and attorneys with the opportunity to connect in person, and included a panel discussion featuring federal and state court judges and the Circuit Executive for the U.S. Courts for the Ninth Circuit. A wide variety of employers, bar associations, law students, attorneys, and judges attended the Diversity Career Fair held at McGeorge School of Law campus. “The Sacramento Region Diversity Career Fair has been groundbreaking, and its successful expansion has strengthened our legal community and commitment to diversity,” said U.S. Attorney Phillip A. Talbert. “We are committed to making the Sacramento Region Diversity Career Fair an annual program to continue this important work with our law schools, bar associations, and the larger legal community.” “McGeorge is pleased and honored to be hosting the second annual Sacramento Region Diversity Career Fair, and we cannot thank the participating employers enough,” said Michael Hunter Schwartz, Dean of McGeorge School of Law. “A majority of our students at McGeorge are members of marginalized racial and ethnic identities, making the Diversity Career Fair not only a vital step towards fostering a better legal profession but also providing our student body with invaluable opportunities to connect with employers who share our commitment to our students and the needs of California’s diverse communities.” “The Sacramento Region Diversity Career Fair provided a wonderful opportunity for our students to connect with employers who prioritize diversity in the legal profession,” UC Davis School of Law Dean Kevin R. Johnson said. “We were so pleased to participate and continue to advance the principles of diversity, equity and inclusion that are the foundation of our school. Many thanks to the outstanding employers who participated and to our partner organizations for allowing us to take part in this important event for our region.” The panel discussion featured Sacramento Superior Court Judge Bunmi Awoniyi, U.S. District Judge Daniel Calabretta (E.D. Cal.), California Court of Appeal Associate Justice Elena Duarte (3DCA), and U.S. Courts for the Ninth Circuit, Circuit Executive Susan Soong. The Sacramento Region Diversity Career Fair was co-sponsored by all of the affinity bar associations in Sacramento, including the Asian/Pacific Bar Association of Sacramento (ABAS), Cruz Reynoso Bar Association, Leonard M. Friedman Bar Association, Sacramento Filipino American Lawyers Association (SacFALA), South Asian Bar Association (SABA), SacLegal Sacramento’s LGBTQ+ Bar Association, Wiley Manuel Bar Association (WMBA), and Women Lawyers of Sacramento (WLS), the Yolo Unity Bar, and by the Sacramento County Bar Association. For more information: https://www.sacramentodiversitycareerfair.org/ . # # # #


title: Justice Department Secures Agreement in Sexual Harassment Lawsuit Against California Property Manager and Owners

component: Civil Rights Division

body_text: The Justice Department announced today that it has secured a $130,000 agreement resolving allegations that Abraham Kesary, violated the Fair Housing Act by sexually harassing multiple female tenants at the Los Angeles rental property he managed. The settlement also resolves claims against M&F Development LLC, the owner of the property. “Tenants have the right to live in their homes free from sexual harassment by their landlords,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The Justice Department will continue to vigorously enforce fair housing laws against landlords who prey on vulnerable residents.” “Our office will not stand for unlawful discrimination of any type,” said U.S. Attorney Martin Estrada for the Central District of California. “The lengthy course of sexual harassment against female residents alleged in this case is disturbing and unacceptable. We will continue to be vigilant in holding landlords and property managers accountable for discrimination and harassment and the Fair Housing Act gives us a powerful tool to seek justice for victims.” Under the agreement, subject to approval by the U.S. District Court for the Central District of California, M&F Development LLC will pay $120,000 to compensate individuals harmed by the harassment and a $10,000 civil penalty to the United States. In addition, the consent order prohibits Kesary from managing rental housing and requires M&F Development LLC to retain an independent property manager to manage the rental property and to implement non-discrimination policies and complaint procedures to prevent sexual harassment at the property in the future. The order also requires both defendants to take fair housing training. The lawsuit alleged that Kesary sexually harassed female tenants at 445 S. Western Avenue in Los Angeles since at least 2012. According to the complaint, Kesary offered housing-related benefits in exchange for sexual acts, made unwelcome sexual comments and advances to female tenants, entered the homes of female tenants without their permission and subjected female tenants to unwelcome sexual acts. The lawsuit also names M&F Development LLC as a defendant. The Justice Department’s Sexual Harassment in Housing Initiative is led by the Civil Rights Division, in coordination with U.S. Attorneys’ Offices across the country. The initiative seeks to address and raise awareness about sexual harassment by landlords, property managers, maintenance workers, loan officers and other people who have control over housing. Since launching the initiative, the department has filed 36 lawsuits alleging sexual harassment in housing and recovered nearly $11 million for victims of such harassment. The Justice Department’s Civil Rights Division enforces the Fair Housing Act, which prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. The Civil Rights Division is committed to protecting people from sexual misconduct. More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt . Individuals may report sexual harassment or other forms of housing discrimination by calling the Justice Department’s Housing Discrimination Tip Line at 1-833-591-0291, or submitting a report online . Individuals may also report such discrimination by contacting HUD at 1-800-669-9777 or by filing a complaint online . kesary_filed_proposed_consent_order.pdf


title: Physician Charged With Distributing A Controlled Substance Appears In Federal Court

component: USAO - North Carolina, Western

body_text: CHARLOTTE, N.C. – A North Carolina physician appeared before U.S. Magistrate Judge Susan C. Rodriguez this morning on charges related to the alleged unlawful distribution of a controlled substance, announced Dena J. King, U.S. Attorney for the Western District of North Carolina. A criminal indictment charging Henry Ronald Emery, Jr., M.D., 52, of Waxhaw, N.C., with one count of conspiracy to distribute controlled substances outside the bounds of professional medical practice, and 11 counts of distribution of controlled substances outside the bounds of professional medical practice was unsealed following Dr. Emery’s initial court appearance. Robert J. Murphy, Special Agent in Charge of the Atlanta Field Division of the Drug Enforcement Administration (DEA), which oversees the Charlotte District Office, and Donald "Trey" Eakins, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI), Charlotte Field Office, join U.S. Attorney King in making today’s announcement. According to allegations contained in the indictment, from no later than September 2018 through in or about 2022, Dr. Emery, then a physician licensed to practice medicine in North Carolina, allegedly conspired with other persons to intentionally and unlawfully prescribe, dispense, and distribute, and did unlawfully prescribe, dispense, and distribute, a mixture and substance containing a detectable amount of buprenorphine, a Schedule III controlled substance. The indictment alleges that Dr. Emery engaged in the illegal distribution of buprenorphine on multiple occasions and while acting and intending to act outside the usual course of professional practice and not for a legitimate medical purpose. If convicted, Dr. Emery faces a maximum penalty of 10 years in prison and a $500,000 fine on each count in the indictment. The charges against Dr. Emery are allegations. A defendant is presumed innocent until proven guilty beyond reasonable doubt in a court of law. In making today’s announcement, U.S. Attorney King thanked the DEA and IRS-CI for their investigation of the case. Assistant U.S. Attorneys Nick J. Miller and William Bozin of the U.S. Attorney’s Office in Charlotte are prosecuting the case.


title: Albemarle to Pay Over $218M to Resolve Foreign Corrupt Practices Act Investigation

component: Criminal Division

body_text: Albemarle Corporation (Albemarle), a publicly-traded specialty chemicals manufacturing company headquartered in Charlotte, North Carolina, has agreed to pay more than $218 million to resolve investigations by the U.S. Department of Justice and the Securities and Exchange Commission (SEC) into violations of the Foreign Corrupt Practices Act (FCPA) stemming from Albemarle’s participation in corrupt schemes to pay bribes to government officials in multiple foreign countries. According to the company’s admissions in connection with the Department’s resolution, between 2009 and 2017, Albemarle, through its third-party sales agents and subsidiary employees, conspired to pay bribes to government officials to obtain and retain chemical catalyst business with state-owned oil refineries in Vietnam, Indonesia, and India. Albemarle obtained profits of approximately $98.5 million as a result of the scheme. “Albemarle earned nearly $100 million by participating in schemes to pay bribes to government officials in multiple countries,” said Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division. “As today’s announcement makes clear, the Justice Department will work tirelessly with our partners in the ongoing fight against international corruption. Today’s resolution also demonstrates the real benefits that companies can receive if they self-disclose misconduct, substantially cooperate, and extensively remediate.” In Vietnam, Albemarle corruptly obtained contracts at two state-owned oil refineries through an intermediary sales agent who requested increased commissions to pay bribes to Vietnam officials and to structure tender requirements to favor Albemarle. In Indonesia, Albemarle used a third-party intermediary to corruptly obtain catalyst business with Indonesia’s state-owned oil company, even after that third-party intermediary had informed Albemarle that it was necessary to pay bribes to Indonesian officials to obtain business. In India, Albemarle used a third-party intermediary to corruptly retain catalyst business with India’s state-owned oil company by avoiding Albemarle being blacklisted. “Corruption has no borders, but neither does justice,” said U.S. Attorney Dena J. King for the Western District of North Carolina. “Companies are expected to adhere to the same ethical and legal standards whether they are doing business on U.S. soil or overseas. Albemarle’s eventual voluntary disclosure of fraud and subsequent efforts to remedy its business practices abroad are a step in the right direction for the company. Above all, today’s announcement underscores our commitment to fight corruption affecting the United States no matter where it occurs.” Albemarle entered into a three-year non-prosecution agreement (NPA) with the Department and agreed to pay a penalty of approximately $98.2 million and administrative forfeiture of approximately $98.5 million. The penalty reflects a reduction of $763,453 under Part II of the Criminal Division’s March 2023 Compensation Incentives and Clawbacks Pilot Program for bonuses that the company withheld from qualifying employees. In addition, Albemarle will pay approximately $103.6 million in disgorgement and prejudgment interest as part of the resolution of the SEC’s parallel investigation. The Department has agreed to credit approximately $81.9 million of the forfeiture to be paid to the Department against disgorgement Albemarle has agreed to pay to the SEC. “The $218 million resolution announced today reflects IRS Criminal Investigation (IRS-CI) special agents’ commitment to working with our law enforcement partners to aggressively expose and disrupt organizations engaged in unscrupulous business practices,” said IRS-CI Chief Jim Lee. “Thanks to our domestic and international law enforcement partners, we’ve ensured Albemarle will be held accountable for their misdeeds.” Pursuant to the NPA, Albemarle has agreed to continue to cooperate with the Department in any ongoing or future criminal investigations relating to this conduct. In addition, Albemarle agreed to continue to enhance its compliance program and provide reports to the Department regarding remediation and the implementation of compliance measures for the three-year term of the NPA. The Department reached this resolution with Albemarle based on a number of factors, including, among others, the nature and seriousness of the offense. Albemarle voluntarily disclosed to the Department conduct that forms the basis for the resolution; however, the disclosure was not “reasonably prompt” as defined in the Criminal Division Corporate Enforcement and Voluntary Self-Disclosure Policy (CEP) and the U.S. Sentencing Guidelines § 8C2.5(g)(1). Albemarle received credit under the CEP for its cooperation with the Department’s investigation, which included (i) voluntarily disclosing the conduct that forms the basis for this agreement before it came to the Department’s attention; (ii) promptly providing information obtained through its internal investigation, which allowed the government to preserve and obtain evidence as part of its own extensive independent investigation; (iii) making regular and detailed presentations to the Department; (iv) proactively identifying information previously unknown to the Department; (v) meeting the Department’s requests promptly; (vi) voluntarily making foreign-based employees available for interviews in the United States; (vii) collecting and producing voluminous relevant documents and translations to the Department, including documents located outside the United States; and (viii) producing documents to the Department from foreign countries in ways that did not implicate foreign data privacy laws. The company promptly engaged in extensive remedial measures including, among other things (i) commencing remedial measures based on its internal investigation of the misconduct prior to the commencement of the Department’s investigation; (ii) disciplining employees involved in the misconduct, including terminating 11 employees and withholding bonuses from 16 employees; (iii) strengthening its anti-corruption compliance program by investing in compliance resources, expanding its compliance function with experienced and qualified personnel, and taking steps to embed compliance and ethical values at all levels of its business organization; (iv) transforming its business model and risk management process to reduce corruption risk in its operation and to embed compliance in the business, including implementing a go-to-market strategy that resulted in eliminating the use of sales agents throughout the company, terminating hundreds of other third-party sales representatives, such as distributors and resellers, and shifting to a direct sales business model; (v) providing extensive training to its sales team and restructuring compensation and incentives so that compensation is no longer tied to sales amounts; (vi) using data analytics to monitor and measure its compliance program’s effectiveness; and (vii) engaging in continuous testing, monitoring, and improvement of all aspects of its compliance program beginning almost immediately following the identification of misconduct. In light of these considerations, the criminal penalty calculated under the U.S. Sentencing Guidelines reflects a 45% reduction off the bottom of the applicable guidelines fine range. IRS-CI is investigating the case. Trial Attorney Katherine Raut of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Daniel Ryan for the Western District of North Carolina are prosecuting the case. The Justice Department’s Office of International Affairs and authorities in Indonesia and India provided substantial assistance in the matter. The Fraud Section is responsible for investigating and prosecuting FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa . NPA