Articles Posted in Wire Fraud, Mail Fraud, Tax Fraud and other Federal Fraud Cases

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Ardon Chinchilla was charged in a federal indictment with violating 18 U.S.C. §1546 by using a fraudulent Order of Supervision to obtain a driver’s license from the Florida Department of Highway Safety and Motor Vehicles. Section 1546 makes it a crime to knowingly use or attempt to use a forged or unlawfully obtained document prescribed by statute or regulation for entry into or as evidence of authorized stay or employment in the United States. An Order of Supervision is a document issued by the U.S. Immigration & Customs Enforcement (ICE) to aliens unlawfully present in the United States. It authorizes an unlawful alien to be released from custody into the community and to remain living in the United States for an indefinite period of time pending removal. An Order of Supervision may authorize the alien to seek employment in the United States. Florida accepts an Order of Supervision from applicants seeking to obtain a Florida driver’s license as proof of legal presence in the United States.

Chinchilla moved to dismiss the superseding indictment for failure to state an offense under §1546 arguing that the term “authorized stay” means lawful presence in the United States and that no federal statute or regulation expressly identifies an Order of Supervision as evidence of authorized stay in the United States. The district court agreed and dismissed the indictment.

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Grow formed a company and teamed up with a compounding pharmacy called Patient Care America to market three of its compounded medications: a pain cream, a scare cream, and a metabolic vitamin. He recruited two sales representatives and paid them using a tiered multilevel pyramid structure which meant that commissions for the sales representatives were based on their own referrals and referrals made by representatives brought in by the representatives they brought in. He also recruited patients instead of doctors and used telemedicine companies to prescribe the creams and vitamins to patients. Some recruited patients were paid commissions for just ordering their own creams and vitamins and set up a phony survey program where Grow’s recruited patients were paid $1,000 per month to try the creams and vitamins and write about their experiences.   The only purpose of the survey was to refer more beneficiaries and get paid commissions. Nothing was done with the results of the survey. Grow was charged and convicted of conspiracy to commit healthcare and wire fraud, committing healthcare fraud, conspiracy to receive and pay kickbacks.

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Gerti Muho’s scheme led to his conviction of bank fraud, wire fraud, aggravated identity, money laundering, and a 264-month sentence in federal prison. In this appeal he claimed that the district court should have reinstated his court appointed counsel despite his having invoked his right to self-representation. He also claims the trial court should have granted his request for court issued subpoenas, and the trial court erred by enhancing his sentence.

Muho worked for an investment firm “FAM” which gave him a position allowing him access to the personal information of the firm’s employees. After he left the firm, he created and used fraudulent documents purporting to reestablish his authority with the firm and then take control of one of FAM’s entities using a shell company he created. He was able to convince a bank, HSBC-Monaco, that he had legal authority to execute financial transactions on behalf of one of the subsidies and incuduced the bank to wire transfer over $2 million from the firm’s subsidy account to an account Muho controlled in another bank.

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Graham’s IRS problems started because he only paid a small portion of the money he made running bingo games from 2006 through 2009. When Graham’s payments to the IRS were too small to satisfy his debt, they became more aggressive and after sending lien and levy notices they began to confiscate and selling several pieces of his real estate. Those sales still fell short of is debt which by June of 2014 reached $3.6 million. Graham met a Thomas Walker who claimed to specialize in credit repair. Walker introduced Graham to two individuals Ben and James that he knew who claimed they could help him pay off his taxes with the help of a bill of exchange that would only cost Graham $10,000. After paying the fee, Ben and James sent Graham and Walker a packet of documents which Graham and Walker took to the IRS building in Montgomery, Alabama. Theses documents included a $3.6 million check entitled an “international bill of exchange. The bill of exchanged was not processed because it looked suspicious and determined to be fraudulent. Graham was indicted on one count of passing a fictitious financial instrument in violation of USC 514(a)(2) and one count of corruptly endeavoring to obstruct the administration of the internal revenue laws in violation of 26 USC 7212(a).

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Corbett and Weaver worked at Florida Hospital near Orlando Florida. When Weaver held the position of release of information specialist he would download patients’ face sheets containing their name, health information, date of birth and social security number without authority to do so and sold them to coconspirators who, the government believed, intended to use the information to open credit card accounts and commit identity fraud.   Corbett took over Weaver’s position as release of information specialist, he solicited her to obtain face sheets without authority and paid her for each assisting him obtain the information. Both were charged with conspiracy to obtain identifiable health information for commercial advantage and pleaded guilty.

The probation officer that calculated the sentencing guidelines recommended a two level enhancement for an offense that involve 10 or more victims under 2B1.1. the probation officer also calculated the Florida Hospital’s loss on costs associated with identifying and notifying patients whose individually identifiable health information was viewed without authorizations. This resulted in a 10 level enhancement. At sentencing the defendant objected to the loss amount on the grounds that the Florida Hospital’s expenses should have been excluded as cost incurred by victims primarily to aid the government in the prosecution and criminal investigation of the offense. She objected to the 10 or more victim enhancement on the grounds that the government only identified a handful at most who suffered any identifiable financial harm as a result of the conspiracy. The district court denied both objections.

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Frank Amodeo pled guilty to conspiracy to defraud the United States for his failure to collect and remit payroll taxes and obstruction of an agency investigation. His offense arose from his scheme to divert his clients’ payroll taxes to his companies’ bank accounts instead of remitting the money to the I.R.S.   As part of his plea agreement he agreed to forfeit many assets including properties, luxury cars a Lear jet, and the ownership of several corporations including two corporations: AQMI Strategy Corporation and Nexia Strategy Corporation.   After the plea, the district court entered a preliminary forfeiture order for the assets, including the two corporations AQMI and Nexia. The government then moved for and received a final forfeiture order giving clear title to the United States.

Eventually, victims from Amodeo’s scheme filed lawsuits against his corporations, including the forfeited AQMI and Nexia. After the victims served the lawsuits on these two companies, the government moved to vacate the final forfeiture order because both were shell corporations without any assets. The government did not want to defend either corporation. The district court granted the motion and vacated the final forfeiture order as to these two corporations. Amodeo moved to reconsider the partial vacatur on the ground that the district court lacked jurisdiction to alter the final forfeiture order. the district court denied the Amodeo’s motion stating that it had vacated only the final forfeiture order in part and not the preliminary order.  the trial court ruled that Amodeo lacked standing to challenge the  vacatur of that order.

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Inmates at the Autry state Prison had a phone scam in which they would masquerade as law-enforcement or court officials and dupe their victims into paying them for fake infractions. Victims paid money to the inmates in the form of Green Dot numbers. Green Dot corporation sells debit cards that can be reloaded by purchasing a MoneyPak at the store’s checkout counter. Inmates possessed theses Green Dot debit cards but were not allowed to possess them in the prison so they possessed the numbers on pieces of paper and hid the papers in their cell until they could load the money. The succeeded for one inmate who collected over $15,000.

Paul Harris was a corrections officer at Autry state Prison when he discovered the scam. He worked on the shakedown team that conducted surprise search of the cell of an inmate. He began to find the Green Dot numbers and learned how the inmates obtained them and that they were worth money. Instead of turning the numbers over to supervisors, Harris loaded the money onto his Green Dot cards. Meanwhile the inmate’s scam continued. After the complaints about the scam and the FBI began to investigate, the Green Dot accounts showed that the amount Harris loaded on his Green Dote card exceeded his income. When confronted he eventually confessed.

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Khaled Elbeblawy was convicted and sentenced in Miami federal court for conspiracy to commit health care fraud in violation of 18 U.S.C. 1349. His offense arose from his ownership and management of home health agencies that provided in-home medical nursing and other services to homebound patients which he used to defraud Medicare for millions of dollars. His fraud included billing Medicare for services that were never provided, paying doctors in case for referring patients, hiring patient recruiters and nurses for referrals. He would disguise check by inflating the rates paid for staffing services and described checks to patient recruiters as payments for consulting and other services.

After an investigation focused on Elbeblawy, he decided to cooperate with the government and helped investigators obtain evidence against his former conspirators. He signed a plea agreement and a written factual basis for the agreement. The agreement stated that the government would be free to use against him in any criminal proceedings any of the statement provided by him including the factual basis for the plea. After he signed the agreement, he changed his mind and refused to plead guilty and the government prosecuted him for the charges he was indicted. Prior to trial Elbeblawy filed a motion to suppress the signed factual basis for the plea agreement on the ground that he did not knowingly and voluntarily waive the Rule 11 and Rule 410 protections. The district court denied his motion.

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Elbeblawy was convicted and sentenced in Miami, Florida, for conspiracy to commit health care fraud in violation of 18 U.S.C. 1349. His offense arose from his ownership and management of home health agencies that provided in-home medical nursing and other services to homebound patients which he used to defraud Medicare for millions of dollars. His fraud included billing Medicare for services that were never provided, paying doctors in case for referring patients, hiring patient recruiters and nurses for referrals. He would disguise check by inflating the rates paid for staffing services and described checks to patient recruiters as payments for consulting and other services.

After an investigation focused on Elbeblawy, he decided to cooperate with the government and helped investigators obtain evidence against his former conspirators. He signed a plea agreement and a written factual basis for the agreement. The agreement stated that the government would be free to use against him in any criminal proceedings any of the statement provided by him including the factual basis for the plea. After he signed the agreement, he changed his mind and refused to plead guilty and the government prosecuted him for the charges he was indicted. Prior to trial Elbeblawy filed a motion to suppress the signed factual basis for the plea agreement on the ground that he did not knowingly and voluntarily waive the Rule 11 and Rule 410 protections. The district court denied his motion.

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This appeal followed the conviction of Geovanys Guevara for causing a car dealership in Miami to file Form 8300s with the United States Treasury Department that contained false statements concerning Guevara’s identity as the individual who provided cash payments over $10,000 to buy four luxury cars: a Rolls Royce, a Lamborghini, a Porshe, and a Farrari. The Bank Secrecy Act requires any person engaged in a non-financial trade or business to file a Form 8300 with the United States Treasury. The form reports any cash payment over $10,000 received by the business or trade. It requires the business to verify and record the name and address of the person from whom the cash payment was received along with social security numbers and taxpayer identification numbers of any person on whose behalf the cash payment is offered.

At trial the Government presented a witness who testified that Guevara paid him $1,000 to go to the car dealer and put title for two of the four cars in his name. The government also presented Guevara’s interview in which he admitted that he was the true owner of all four cars. He admitted purchasing the cars and placing two of the titles in the name of his friend. He also admitted that the car dealer owner knew that Guevara was paying for theses vehicle.   He said he bought the cars using money from a therapy clinic he owned and admitted paying his friend to go to the dealership to take title to the cars.

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