Justice Department Recovers Over $4.7 Billion From False Claims Act Cases in Fiscal Year 2016

The Department of Justice obtained more than $4.7 billion in settlements and judgments from civil cases involving fraud and false claims against the government in fiscal year 2016 ending Sept. 30, Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division, announced today.  This is the third highest annual recovery in False Claims Act history, bringing the fiscal year average to nearly $4 billion since fiscal year 2009, and the total recovery during that period to $31.3 billion.

“Congress amended the False Claims Act 30 years ago to give the government a more effective tool against false and fraudulent claims against federal programs,” said Mizer.  “An astonishing 60 percent of those recoveries were obtained in the last eight years.  The beneficiaries of these efforts include veterans, the elderly, and low-income families who are insured by federal health care programs; families and students who are able to afford homes and go to college thanks to federally insured loans; and all of us who are protected by the government’s investment in national security and defense.  In short, Americans across the country are healthier, enjoy a better quality of life, and are safer because of our continuing success in protecting taxpayer funds from misuse.”

Of the $4.7 billion recovered, $2.5 billion came from the health care industry, including drug companies, medical device companies, hospitals, nursing homes, laboratories, and physicians.  The $2.5 billion recovered in fiscal year 2016 reflects only federal losses.  In many of these cases, the Department was instrumental in recovering additional millions of dollars for state Medicaid programs.  This is the seventh consecutive year the Department’s civil health care fraud recoveries have exceeded $2 billion. read more »

Man sentenced in health care fraud scheme

A former Tinley Park doctor has been sentenced to 40 months in federal prison after being convicted nearly a year ago of health care fraud.

Banio Koroma, 67, also was ordered to pay $1.5 million in restitution for his role in a scheme that defrauded Medicare. He was sentenced Friday by U.S. District Court Judge John Tharp Jr.

Koroma worked for the now-defunct Mobile Doctors, which contracted with doctors to arrange in-home visits for patients in Illinois, Indiana, Michigan and other states, according to the U.S. attorney's office.

Convicted following a jury trial in January, Koroma had certified some patients as being confined to their homes when they were actually not home-bound and did not require the skilled-nursing services Koroma had ordered, the U.S. attorney's office. read more »

U.S. Generic Drug Probe Seen Expanding After Guilty Pleas

Two executives of a small generic drugmaker are preparing to plead guilty to price-fixing charges and will cooperate with U.S. prosecutors examining allegations of widespread collusion among drug manufacturers, according to people with knowledge of the matter.

Jeffrey Glazer, a former chief executive officer of Heritage Pharmaceuticals Inc., and Jason Malek, an ex-president, were charged in Philadelphia, according to court filings unsealed on Wednesday. Each was charged in a criminal information with two counts of conspiring with other drugmakers, which weren’t identified, to fix the prices of an antibiotic and a drug used to treat diabetes.

They are the first criminal charges stemming from a sweeping two-year investigation of the generic-drug industry. The executives are preparing to plead guilty at a court appearance scheduled for Jan. 9, the people with knowledge of the matter said. Their cooperation could lead to charges against executives at other drugmakers, the people said. read more »

Credit Suisse must face New York case over mortgage securities - appeals panel

A New York appeals court on Tuesday refused to dismiss a lawsuit against Credit Suisse Group AG over toxic mortgage securities it sold in the run-up to the 2008 financial crisis.

The case was filed by New York Attorney General Eric Schneiderman in 2012, which the Swiss bank unsuccessfully argued was outside the statute of limitations. read more »

Oops, Wells Fargo Did It Again

Tim Sloan has spent just over two months as CEO of Wells Fargo & Co., and it probably feels more like a lifetime.Sloan took the reins at the San Francisco-based lender after his predecessor John Stumpf stepped down amid a scandal over the bank's sales practices that led to thousands of firings and resulted in $185 million in fines, a string of investigations and a dent to its reputation. And it's not over: Just this week, regulators in California and New Jersey said they were probing whether the bank fraudulently signed up customers to Prudential Financial Inc. life policies. read more »

Wells Fargo’s Hometown Penalizes Bank Amid Fake-Accounts Scandal

Wells Fargo & Co., the bank working to contain a scandal over bogus accounts, was suspended from doing some business with its hometown of San Francisco.

The city’s Board of Supervisors on Tuesday suspended the firm for two years from providing services as a broker dealer, in commercial banking and in commercial paper. The measure, sponsored by Supervisor John Avalos, also removed Wells Fargo from securities investments and counterparty/repurchasing agreements. San Francisco had barred the lender in September from a banking program for low-income residents. read more »

An Insider-trading Ruling that Delights Prosecutors - and One Manhattan Judge

Last week, prosecutors rejoiced when the U.S. Supreme Court decided an insider-trading case called Salman v. United States, and in doing so clarified that leaking confidential information so that friends and relatives can make money in the stock market is a crime, even when the leaker doesn’t get an economic benefit. Perhaps the person most pleased with the decision, however, was not a prosecutor but a certain white-haired Manhattan judge with a neatly trimmed, white beard. read more »