Justia White Collar Crime Opinion Summaries

Oladayo Oladokun was convicted in the United States District Court for the Southern District of New York after pleading guilty to conspiracy to commit bank fraud and conspiracy to commit money laundering. His involvement included directing others to open bank accounts to receive stolen or forged checks and launder money. He was sentenced to 125 months in prison followed by three years of supervised release.Oladokun appealed, challenging the district court's calculation of his offense level under the United States Sentencing Guidelines. He argued against the application of an eighteen-level enhancement based on the loss amount, a two-level enhancement for ten or more victims, and a four-level enhancement for his role in an offense involving five or more participants. Additionally, he claimed ineffective assistance of counsel for not requesting a Franks hearing to suppress evidence obtained from his residence.The United States Court of Appeals for the Second Circuit reviewed the case. The court found that the district court did not err in its factual basis for the Guidelines enhancements. It upheld the eighteen-level enhancement for the intended loss amount, the two-level enhancement for ten or more victims, and the four-level enhancement for Oladokun's role in the offense. The court also rejected Oladokun's ineffective assistance claim, noting that even if his counsel had been ineffective, Oladokun failed to show the requisite prejudice because the warrant application was supported by probable cause without the challenged evidence.The Second Circuit affirmed the judgment of the district court. View "United States v. Oladokun" on Justia Law

Dr. Anita Jackson, an otolaryngologist, was convicted of various offenses related to her private medical practice in North Carolina. She was the leading Medicare biller for balloon sinuplasty surgery, a procedure treating chronic sinusitis. Jackson reused single-use medical devices, specifically the Entellus XprESS Multi-Sinus Dilation Tool, on multiple patients without proper sterilization, leading to potential contamination. She also incentivized employees to recruit Medicare patients for the procedure, often bypassing proper medical assessments. Additionally, Jackson falsified documents and patient signatures in response to Medicare audits.The United States District Court for the Eastern District of North Carolina convicted Jackson on all counts, including violating the Food, Drug, and Cosmetics Act (FDCA) by holding for resale adulterated medical devices, violating the federal anti-kickback statute, making materially false statements, committing aggravated identity theft, mail fraud, and conspiracy. Jackson was sentenced to twenty-five years in prison and ordered to pay over $5.7 million in restitution. She moved for a judgment of acquittal and a new trial, which the district court denied.The United States Court of Appeals for the Fourth Circuit reviewed the case. Jackson argued that the devices were not "held for sale" under the FDCA, that her actions were protected under 21 U.S.C. § 396, and that the Government relied on a defective theory of per se adulteration. She also challenged the exclusion of certain evidence and jury instructions. The Fourth Circuit found no reversible error in the district court's rulings, holding that the devices were indeed "held for sale," that § 396 did not protect her conduct, and that the Government's theory was valid. The court also upheld the exclusion of evidence and the jury instructions. Consequently, the Fourth Circuit affirmed all of Jackson's convictions. View "United States v. Jackson" on Justia Law

Humana, a health insurance company and Medicare Part C and Part D sponsor, filed a lawsuit against Biogen, a drug manufacturer, and Advanced Care Scripts, Inc. (ACS), a specialty pharmacy, in the District of Massachusetts. Humana alleged that Biogen and ACS engaged in fraudulent schemes involving three multiple sclerosis drugs, violating the civil RICO statute. Humana claimed that Biogen "seeded" the market with these drugs, funneled patients into Medicare, and indirectly funded patient copays through third-party patient-assistance programs (PAPs). Humana also alleged that ACS aided Biogen's scheme by steering patients and acting as an intermediary between Biogen and the PAPs, causing the submission of false certifications to Humana.The district court dismissed the case, ruling that Humana lacked standing to bring RICO claims because it was an indirect purchaser and failed to plead the RICO claims with particularity as required by Federal Rule of Civil Procedure 9(b). The court found that Humana did not specify the time, place, and content of the alleged fraudulent communications and failed to detail the false certifications' language, timing, and context. Humana's motion for leave to amend the complaint was also denied.The United States Court of Appeals for the First Circuit reviewed the case. The court affirmed the district court's dismissal, agreeing that Humana failed to meet the heightened pleading standard of Rule 9(b) for its RICO claim. The court held that Humana did not provide specific details about the fraudulent certifications or the use of mail or wire communications in furtherance of the scheme. The court also upheld the denial of leave to amend, citing undue delay and the inefficiency of seeking amendment after dismissal. View "Humana Inc. v. Biogen, Inc." on Justia Law

Julian Omidi and his business, Surgery Center Management, LLC (SCM), were involved in a fraudulent scheme called "Get Thin," which promised weight loss through Lap-Band surgery and other medical procedures. Omidi and SCM defrauded insurance companies by submitting false claims for reimbursement, including fabricated patient data and misrepresented physician involvement. The scheme recruited patients through a call center, pushing them towards expensive medical tests and procedures regardless of medical necessity.A grand jury indicted Omidi and SCM for mail fraud, wire fraud, money laundering, and related charges. After extensive pretrial litigation and a lengthy jury trial, both were convicted on all charges. The district court sentenced Omidi to 84 months in prison and fined SCM over $22 million. The government sought forfeiture of nearly $100 million, arguing that all proceeds from the Get Thin scheme were derived from fraud. The district court agreed, finding that even proceeds from legitimate procedures were indirectly the result of the fraudulent scheme.The United States Court of Appeals for the Ninth Circuit reviewed the case. The court affirmed the district court's forfeiture judgment, holding that under 18 U.S.C. § 981(a)(1)(C), all proceeds directly or indirectly derived from a health care fraud scheme must be forfeited. The court rejected the argument that only proceeds from fraudulent transactions should be forfeited, noting that the entire business was permeated with fraud. The court concluded that there is no "100% Fraud Rule" in forfeiture cases seeking proceeds of a fraud scheme, and all proceeds from the Get Thin scheme were subject to forfeiture. View "United States V. Surgery Center Management, LLC" on Justia Law

Dwayne Sherman was indicted for several offenses related to drug trafficking in Central Pennsylvania, including six counts of money laundering, one count of conspiracy to possess with intent to distribute 500 grams or more of cocaine, and one count of conspiracy to launder money. The charges stemmed from activities between 2012 and 2018. Evidence presented at trial included testimony from a drug dealer, Paul Alston, who bought cocaine from Sherman, and FBI informant Ruben Martin, who received large sums of cash from Sherman intended for Mexico. Sherman admitted to selling cocaine and making money drops but claimed ignorance of the money's criminal origins.The United States District Court for the Middle District of Pennsylvania denied Sherman’s motion for a new trial but vacated three of his money-laundering convictions, finding they were separate means of committing a single offense. At sentencing, the court applied a dangerous-weapon enhancement based on Sherman’s testimony about having access to handguns while storing drug proceeds at home, resulting in a 262-month imprisonment sentence.The United States Court of Appeals for the Third Circuit reviewed the case. Sherman argued that the evidence was insufficient to sustain his convictions, the government’s proof of the drug conspiracy varied from the indictment, and the district court erred in applying the dangerous-weapon enhancement. The Third Circuit found that the evidence supported the jury’s verdict, including Sherman’s knowledge and intent regarding the money laundering and drug conspiracy charges. The court also found no impermissible variance between the indictment and the trial evidence and upheld the district court’s application of the dangerous-weapon enhancement. Consequently, the Third Circuit affirmed the district court’s judgment. View "USA v. Sherman" on Justia Law

Abdul Fatani was involved in a fraudulent Paycheck Protection Program (PPP) loan scheme during the COVID-19 pandemic. The scheme, led by Amir Aqeel, involved submitting false PPP loan applications with fabricated payroll information and supporting documents. Fatani, as a borrower, submitted a fraudulent application for his company, Route 786 USA, Inc., which had no employees or payroll. The loan was approved, and $511,250 was deposited into Route 786’s bank account. Fatani then wrote checks to co-conspirators and created fake payroll checks to make it appear that the funds were used for legitimate expenses.The United States District Court for the Southern District of Texas tried Fatani, and a jury found him guilty of conspiracy to commit wire fraud, wire fraud, and engaging in a monetary transaction with criminally derived property. Fatani moved for a judgment of acquittal, which the district court denied. The court sentenced him to 36 months in prison for each count, to run concurrently, along with 3 years of supervised release and restitution of $511,250. Fatani appealed the conviction and sentence.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court affirmed the district court’s judgment, finding sufficient evidence to support Fatani’s wire fraud conviction. The court held that the scheme to defraud was not complete until Aqeel, the mastermind, received his share of the proceeds, and the wire transfer in question was part of that scheme. The court also found that Fatani’s 36-month sentence was substantively reasonable, considering the mitigating factors presented. However, the court remanded the case for correction of a clerical error in the written judgment, which incorrectly listed aiding and abetting convictions. View "USA v. Fatani" on Justia Law

In this case, the defendant, a local attorney, was contracted by Theory Wellness, a marijuana dispensary operator, to assist in obtaining a host community agreement from the City of Medford, Massachusetts. Instead of legitimate lobbying, the defendant attempted to bribe Medford's chief of police through the chief's brother. This led to the defendant's convictions on two counts of honest-services wire fraud and one count of federal programs bribery.The United States District Court for the District of Massachusetts presided over the trial, where a jury convicted the defendant on all counts. The defendant was sentenced to concurrent twenty-four-month terms of imprisonment. The defendant appealed, challenging the sufficiency of the evidence, the admission of certain testimony, and the jury instructions.The United States Court of Appeals for the First Circuit reviewed the case. The court vacated the honest-services wire fraud convictions, finding that the district court erroneously admitted the only evidence establishing the jurisdictional element of those counts. However, the court affirmed the federal programs bribery conviction, concluding that the evidence was sufficient to support the jury's finding that the defendant intended to bribe the chief of police.The court held that the defendant's actions constituted a bribery scheme under 18 U.S.C. § 666, even if the defendant did not believe the chief had accepted the bribe. The court also found that the district court's failure to instruct the jury on the requirement of an "official act" was harmless, as the evidence overwhelmingly supported the conclusion that the defendant sought official acts from the chief. The court rejected the defendant's entrapment defense, finding no improper inducement by the government and that the defendant was predisposed to commit the crime. View "United States v. O'Donovan" on Justia Law

Defendant Shefiu A. Hanson, serving a 46-month sentence for wire fraud, appealed the district court’s denial of his motion to reduce his sentence under 18 U.S.C. § 3582(c)(2). Hanson had pled guilty to wire fraud and conspiracy for creating fraudulent bank and email accounts to induce businesses to wire money to his accounts. The total loss to 30 victims was $1,122,805.74. Hanson, with no prior convictions, had a Criminal History Category of I and an Offense Level of 22, resulting in a Guidelines Range of 41 to 51 months. He was sentenced to 46 months in May 2023.Hanson moved for a sentence reduction under the newly created U.S.S.G. § 4C1.1, which applies retroactively. The government opposed, arguing Hanson was ineligible because he caused substantial financial hardship to his victims. The district court agreed, finding Hanson caused substantial financial harm to multiple victims, making him ineligible under U.S.S.G. § 4C1.1(a)(6). The court also concluded that a sentence reduction would not adequately reflect the seriousness of the offense or provide just punishment.The United States Court of Appeals for the Sixth Circuit reviewed the case. The court held that the district court did not err in determining Hanson was ineligible for a sentence reduction. The court noted that the financial hardship caused by Hanson did not need to fall perfectly within the factors listed in U.S.S.G. § 2B1.1 n.4F, as the list is non-exhaustive. The district court reasonably concluded that the financial hardship to at least one victim was substantial, citing specific examples of individual victims' hardships. The court affirmed the district court’s order denying Hanson’s motion for a sentence reduction. View "United States v. Hanson" on Justia Law

The defendant, Guy Cuomo, was convicted of multiple offenses, including conspiracy to commit computer fraud, accessing a protected computer without authorization, aggravated identity theft, misuse of a social security number, and conspiracy to misuse social security numbers. Cuomo, along with his co-defendant, operated companies that engaged in skip tracing, which involved obtaining debtors' place of employment (POE) information by impersonating them and initiating fraudulent unemployment insurance applications using their personal information.The United States District Court for the Northern District of New York, following a jury trial, found Cuomo guilty on all counts. The court sentenced him to 45 months of imprisonment, followed by three years of supervised release. Cuomo appealed, arguing that his conduct did not violate the relevant statutes, the jury instructions were deficient, and the evidence was insufficient to support his convictions.The United States Court of Appeals for the Second Circuit reviewed the case. The court found that the evidence was sufficient to support the jury's findings that Cuomo accessed a computer without authorization and obtained information for financial gain. The court also upheld the jury instructions, stating they were not erroneous. Additionally, the court found no merit in Cuomo's arguments regarding the misuse of social security numbers and aggravated identity theft, noting that the evidence supported the convictions.The appellate court affirmed the district court's judgment, concluding that Cuomo's contentions were without merit and that the district court did not err in its findings or sentencing. View "USA v. Cuomo" on Justia Law

Randy Torres, Walston Owen, and Charles Ventura were involved in a street gang known as the Rollin’ 30s Crips. Following a jury trial, they were convicted of various offenses, including racketeering conspiracy under the Racketeer Influenced and Corrupt Organizations Act (RICO). Owen and Ventura were also convicted of additional firearms and assault offenses. Torres and Owen received sentences of 475 months’ imprisonment, while Ventura was sentenced to 288 months.The United States District Court for the Southern District of New York oversaw the trial. The defendants raised several arguments on appeal, including insufficient evidence to support their convictions, errors in jury instructions, improper admission of co-conspirator statements, and issues related to jury impartiality. They also challenged the district court’s refusal to grant a downward departure in Ventura’s sentencing.The United States Court of Appeals for the Second Circuit reviewed the case. The court found that there was sufficient evidence to support the convictions, including the special sentencing factors related to the murders of Victor Chaffa and Nestor Suazo. The court also held that the district court did not err in its jury instructions or in its handling of the juror impartiality issues. Additionally, the court found no abuse of discretion in the admission of co-conspirator statements.The Second Circuit dismissed Ventura’s claim regarding the district court’s refusal to grant a downward departure for lack of jurisdiction and affirmed the judgments of the district court in all other respects. The court concluded that the defendants’ arguments were without merit and upheld their convictions and sentences. View "United States v. Torres" on Justia Law