BUFFALO, N.Y.-- MAXIM G. LEVIN, 29, of Tonawanda, New York, pled guilty before U.S. District Judge William M. Skretny, to felony charges of health care fraud and conspiracy to distribute cocaine, U.S. Attorney Terrance P. Flynn of the Western District of New York announced today. The health care fraud conviction carries a maximum penalty of 10 years in prison, a fine of $250,000, or both. The drug distribution conspiracy conviction carries a maximum penalty of 40 years imprisonment, a fine of $2,000,000, or both
Assistant U.S. Attorney John E. Rogowski, who handled the case, stated that the defendant operated First Buffalo Medical clinic, which was located on Main Street in Williamsville, for a 18 month period beginning in the spring of 2001. In pleading guilty. Levin admitted that he paid individuals to participate in a number of staged automobile collisions in order to bilk insurance companies through no-fault insurance claims. The participants falsely claimed that the collisions were accidental and that they had been injured in the collision. Many of the participants then went for "treatment" at Levin's clinic. Levin, rather than medical personnel at First Buffalo, decided what "treatment" would be given to the participants. Levin caused others associated with FBM to create reports of medical exams and treatments that reported injuries that were non-existent or greatly exaggerated, or which were not caused by the staged collision, in order to be reimbursed by insurance companies for medical treatment that, if actually rendered, was not made medically necessary on account of an automobile “accident.”
Levin further admitted that participants were enticed into the scheme by the promise that they would be the beneficiaries of person injury settlements stemming from the staged collisions. A number of participants did receive injury settlements from insurance companies and rental car agencies. The total loss attributed to Levin's participation in the scheme was $297,900. Levin is the twenty-fifth person to plead guilty in connection with the staged accident scam.
Levin also admitted that he conspired to possess with intent to distribute more than 500 grams of cocaine during the period of April 2003 and May, 2004. On a number of occasions during that period, Levin sold cocaine to an agent of the FBI working in an undercover capacity.
The plea was the culmination of an investigation on the part of the Western New York Health Care Fraud Task Force consisting of agents from the Federal Bureau of Investigation, Internal Revenue Service - Criminal Investigation Division, United States Department of Health and Human Services - Office of Inspector General, United States Postal Service - Office of Inspector General, United States Department of Defense - Criminal Investigation Service, the United States Food and Drug Administration - Office of Criminal Investigation, the United States Department of Labor - Office of Inspector General, and the New York State Insurance Fraud Bureau. Other law enforcement agencies involved in the investigation were the United States Department of Homeland Security - Bureau of Immigration and Customs Enforcement, the Niagara County District Attorney’s Office and the Amherst Police Department.
Sentencing is scheduled for July 7, 2007, at 9:00 a.m. EDT, in Buffalo, N.Y., in front of U.S. District Judge Skretny.
An international credit card trafficker thought to be one of the most prolific sellers of stolen data was arrested in Nice, France, on Aug. 7, 2010, on charges in an indictment unsealed today in U.S. District Court in the District of Columbia, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney Ronald C. Machen Jr. for the District of Columbia, and U.S. Secret Service Assistant Director for Investigations Michael Merritt.
Vladislav Anatolievich Horohorin, 27, aka “BadB” of Moscow, Russia, was indicted by a federal grand jury in November 2009 on charges of access device fraud and aggravated identity theft. The indictment was unsealed today, following Horohorin’s arrest by French authorities during the weekend.
“In just the last week, we’ve seen an alleged hacker extradited to the United States to face charges, and now, a credit card data dealer arrested abroad on U.S. charges,” said Assistant Attorney General Lanny A. Breuer of the Criminal Division. “Cyber criminals who target U.S citizens should not fool themselves into believing they can elude justice simply because they commit crimes outside of our borders. As this and so many other cases demonstrate, working hand in hand with our partners around the globe, we will do everything in our power to bring these criminals to the United States to answer for their alleged crimes.”
“Computer hackers and identity thieves threaten the security of millions of innocent Americans with their crimes. These criminals are mistaken to think that they can escape detection by committing their crimes behind a computer screen in a foreign country,” said U.S. Attorney Machen. “The arrest and prosecution of Mr. Horohorin demonstrates that we will identify, apprehend, and bring to justice in the United States even the most sophisticated international computer hackers.”
“The network created by the founders of CarderPlanet, including Vladislav Horohorin, remains one of the most sophisticated organizations of online financial criminals in the world,” said U.S. Secret Service Assistant Director for Investigations Michael Merritt. “This network has been repeatedly linked to nearly every major intrusion of financial information reported to the international law enforcement community. This arrest is an illustration of the success that comes from international law enforcement and private sector partnerships and confirms the Secret Service commitment to traversing the globe in pursuit of online criminals.”
According to the indictment, Horohorin was the subject of an undercover investigation by U.S. Secret Service agents. Horohorin, who is a citizen of Israel and the Ukraine, allegedly used online criminal forums such as “CarderPlanet” and “carder.su” to sell stolen credit card information, known as “dumps,” to online purchasers around the world. According to the indictment, Horohorin, using the online name “BadB,” advertised the availability of stolen credit card information through these web forums, and directed purchasers to create accounts at “dumps.name,” a fully-automated dumps vending website operated by Horohorin and hosted outside the United States. The website was designed to assist in the exchange of funds for the stolen credit card information. Horohorin allegedly directed buyers to fund their “dumps.name” account using funds transferred by services including “Webmoney,” an online currency service hosted in Russia. The purchaser would then access the “dumps.name” website and select the desired stolen credit card data. Using an online undercover identity, U.S. Secret Service agents negotiated the sale of numerous stolen credit card dumps.
PREET BHARARA, the United States Attorney for the Southern District of New York; CYRUS R. VANCE, JR., the District Attorney for New York County ("DANY"); JANICE K. FEDARCYK, the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation ("FBI"); RAYMOND W. KELLY, the Police Commissioner for the City of New York; CHRISTOPHER PAUL, the Special Agent-in-Charge of the New York Field Office of the U.S. Department of State, Bureau of Diplomatic Security Service ("DSS"); JAMES T. HAYES, JR., Special Agent-in-Charge of the New York Office of Homeland Security Investigation ("HSI"); and BRIAN G. PARR, the Special Agent-in-Charge of the New York Field Office of the United States Secret Service ("USSS"), announced charges against 37 defendants, in 21 separate cases, for their roles in global bank fraud schemes that allegedly used hundreds of false-name bank accounts to steal over $3 million from dozens of U.S. accounts that were compromised by malware attacks.
Manhattan U.S. Attorney PREET BHARARA said: "The digital age brings with it many benefits, but also many challenges for law enforcement and our financial institutions. As today's arrests show, the modern, high-tech bank heist does not require a gun, a mask, a note, or a getaway car. It requires only the Internet and ingenuity. And it can be accomplished in the blink of an eye, with just a click of the mouse. But today's coordinated operation demonstrates that these 21st century bank robbers are not completely anonymous; they are not invulnerable. Working with our colleagues here and abroad, we will continue to attack this threat, and bring cyber criminals to justice."
District Attorney CYRUS VANCE, JR. said: "This advanced cybercrime ring is a disturbing example of organized crime in the 21st century—high tech and widespread. The 36 defendants indicted by our office stole from ordinary citizens and businesses using keyboards—not a gun. The far-reaching results of this investigation to date represent what people deserve: successful cooperation between city, state, federal, and foreign law enforcement officials, who worked together for a common goal—to identify and prosecute individuals who commit fraud against New Yorkers and the rest of the nation."
FBI Assistant Director-in-Charge JANICE K. FEDARCYK stated: "The Zeus Trojan allegedly allowed the hackers, from thousands of miles away, to get their hands on other peoples' money—with far less exertion than a safecracker or a bank robber. But their scheme didn't eliminate risk. Like the money mules, many, if not all, will end up behind bars."
NYPD Commissioner RAYMOND W. KELLY said: "After NYPD detectives entered a Bronx bank in February to investigate a suspicious $44,000 withdrawal, it soon became evident that it was just the tip of an international iceberg. I want to commend those detectives and our federal partners for coming to the rescue of unwitting depositors who were put at risk in this latest form of transnational thievery."
DSS Special Agent-in-Charge CHRISTOPHER PAUL said: "The charges announced today send a strong message: Diplomatic Security is committed to collaborating with our law enforcement partners to make sure that those who commit fraud face consequences for their criminal actions. Diplomatic Security's strong relationship with the U.S. Attorney's Office and other law agencies around the world continues to be essential in the pursuit of justice."
$42.5 Million Fraud on Organization That Makes Reparations to Victims of Nazi Persecution
PREET BHARARA, the United States Attorney for the Southern District of New York, and JANICE K. FEDARCYK, the Assistant Director-In-Charge of the New York Office of the Federal Bureau of Investigation ("FBI"), announced today the unsealing of criminal charges against 17 alleged members of a long-running scheme that defrauded programs established to aid survivors of Nazi persecution out of more than $42 million. Employees of the Conference on Jewish Material Claims Against Germany (the "Claims Conference"), which administered the programs, were supposed to process and approve legitimate applications. Instead, they allegedly approved over 5,500 fraudulent applications, resulting in payouts to applicants who did not qualify for the programs. In exchange, these insiders kept a portion of the money for themselves and their coconspirators.
Manhattan U.S. Attorney PREET BHARARA said: "If ever there was a cause that you would hope and expect would be immune from base greed and criminal fraud, it would be the Claims Conference, which every day assists thousands of poor and elderly victims of Nazi persecution. Sadly, those victim funds were themselves victimized. Without the extraordinary cooperation of the Claims Conference in ferreting out this alleged scheme to defraud them, it never would have been exposed. We thank them for their assistance. With our partners at the FBI, we will bring to justice all those who would callously line their own pockets by looting a lifeline for Holocaust survivors."
FBI Assistant Director-in-Charge JANICE K. FEDARCYK said: "Each of the defendants played a role in creating, filing and processing fraudulent claims on behalf of non-qualifying applicants—and dividing up the spoils. Funds established and financed by the German government to aid Holocaust survivors were siphoned off by the greedy, and not paid out, as intended, to the worthy. This was a brazen miscarriage of the compensation programs."
As alleged in the Criminal Complaint and other charging documents unsealed today:
The Claims Conference, a not-for-profit organization which provides assistance to victims of Nazi persecution, supervises and administers several funds that make reparation payments to victims of the Nazis, including "the Hardship Fund" and "the Article 2 Fund," both of which are funded by the German government. Applications for disbursements through these funds are processed by employees of the Claims Conference's office in Manhattan, and the employees are supposed to confirm that the applicants meet the specific criteria for payments under the funds.
As part of the charged scheme, a web of individuals—including six of the employees who worked for the Claims Conference—systematically defrauded the Article 2 Fund and Hardship Fund programs for over a decade. As explained in the Complaint, the Claims Conference first suspected the fraud in December 2009, and immediately reported their suspicions to law enforcement, which conducted a wide-reaching investigation resulting in the charges unsealed today.
The Hardship Fund pays a one-time payment of approximately $3,600 to victims of Nazi persecution who evacuated the cities in which they lived and were forced to become refugees. Members of the conspiracy submitted fraudulent applications for people who were not eligible. Many of the recipients of fraudulent funds were born after World War II, and at least one person was not even Jewish. Some conspirators recruited other individuals to provide identification documents, such as passports and birth certificates, which were then fraudulently altered and submitted to corrupt insiders at the Claims Conference, who then processed those applications. When the applicants received their compensation checks, they kept a portion of the money and passed the rest back up the chain.