Traverse City Man Pleads Guilty to Fraud

Mark J. Mandell, Esq.

William Lowder, a northern Michigan insurance broker, pleaded guilty to fraud. After manipulating clients to change their investments and encouraging them to put money in annuities handled by his Traverse City office, Lowder cost his clients more than $1 million over an eight-year period.

Only a week after charges were filed, 57-year-old Lowder pleaded guilty in Grand Rapids federal court. Lowder also pleaded guilty to a tax crime. Earlier last year, state regulators suspended his license. While he took advantage of many clients, the state regulators say he also took advantage of at least one client who was mentally incompetent.

He has been given a court-appointed attorney and will receive his sentence on May 29.

If you have questions about criminal matters, fraud or other legal issues, please contact Mark Mandell or Tariq Hafeez at 248.380.0000 or online at www.MichiganFraudLawyer.com.

To learn more and read the original article, please visit: http://www.insurancejournal.com/news/midwest/2013/01/21/278066.htm

 

Increase in Fraudulent Loan Applications Necessitates Vigilance for Lenders

Mark J. Mandell, Esq.

A troubling spike in fraudulent loan applications in Flint, Michigan between June 2012 and October 2012 is the highest in the nation. According to Kroll Factual Data, a Colorado-based lender verification service, Flint saw a 50.3 percent increase in fraudulent loan applications to banks, mortgage lenders, and credit unions. While fraud alerts saw declines in some areas of the country, these declines were offset by significant increases in other areas of the country.

“The spike in potential fraud is troubling, coming at the same time the mortgage industry is beginning to turn the corner,” said Rod Bazzani, president of Kroll Factual Data. More so, the increase in potential fraud poses a risk for lenders and highlights the need for lenders to continue to be vigilant.

The results of the study were announced just two weeks after the federal Consumer Financial Protection Bureau issued new regulations for borrowers. Such regulations include the need to verify financial records in order to ensure one’s ability to repay mortgages.

Kroll Factual Data examined multiple metropolitan areas and used proprietary risk analysis and verification engines to isolate files that contain indicators of mortgage origination fraud. While Flint saw the largest increase, other cities that made the top ten include Colombia, Missouri; Lancaster, Pennsylvania; and Tacoma, Washington. While most other cities that saw increases in fraudulent loan applications hovered around an increase of 20 percent, Flint saw an increase of around 50 percent. Nationally, fraudulent loan applications increased just 1.1 percent. In comparison, the increases in Flint are quite troubling.

If you have questions about criminal matters, fraud or other legal issues, please contact Mark Mandell or Tariq Hafeez at 248.380.0000 or online at www.MichiganFraudLawyer.com.

To learn more and read the original article, please visit: http://www.mlive.com/business/mid-michigan/index.ssf/2013/01/flints_increase_in_fraudulent.html

Seventeen-Year Sentence Awaits Pharmacist

Mark J. Mandell, Esq.

 

After billing the government for more than $57 million worth of medically unnecessary painkillers, Babubhai (Bob) Patel now faces 17 years in prison.

Owning and operating more than 26 pharmacies across metro Detroit, Patel had a myriad of doctors at his fingertips. He paid such doctors to write orders and had recruiters offer cash to lower-income individuals in exchange for their Medicare or Medicaid numbers. The scheme operated on a business model that paid kickbacks to physicians in exchange for their writing prescriptions for expensive – yet unneeded – medications. As a result, between 2006 and 2011, Patel billed Medicare and Medicaid for over $57 million. At least 25 percent of those billings were for drugs that were never dispensed or were unnecessary to begin with. Not only did Patel take advantage of the government, but he also fraudulently billed to private insurers, such as Blue Cross Blue Shield of Michigan.

In addition to the years Patel will face behind bars, he has also been ordered to pay restitution in the amount of $17.3 million to Medicaid and Medicare, as well an additional $1.5 million to Blue Cross Blue Shield.

“What you have done,” the court told Patel, “is reprehensible.”

If you have questions about criminal matters, fraud or other legal issues, please contact Mark Mandell or Tariq Hafeez at 248.380.0000 or online at www.MichiganFraudLawyer.com.

To learn more and read the original article, please visit: http://www.siliconindia.com/news/usindians/IndianAmerican-Jailed-for-17-Years-For-Healthcare-Fraud-nid-140144-cid-49.html

 

Michigan Supreme Court Justice Retires After Accusations of Bank Fraud

Mark J. Mandell, Esq.

Amidst federal charges of bank fraud, Diane Hathaway has filed for retirement, stepping down from her post as Michigan Supreme Court Justice. The charge was filed Friday as a “criminal information,” which means it was negotiated and that a guilty plea is expected in federal court. As a result, Hathaway faces the loss of her law license and time in prison.

In order to convince a lender that she qualified for a short sale on her $1.5 million home in Grosse Pointe, Hathaway concealed her ownership of a Florida home by placing the home in husband’s daughter’s name. As a result, the short sale went through in November 2011 and erased the $600,000 debt they had with the bank. Following the short sale, the Florida home was transferred back to Hathaway in March 2012. Hathaway has refused to make any public comments explaining the transactions; instead, she claims that the property shuffle was a private matter.

Now, the judge that sentences her must be concerned with the message that is sent by his decision: “Do you cut a break to a sitting Supreme Court Justice who has to know better?” Peter Henning, a professor at Wayne State University Law School, asked. The maximum penalty for bank fraud is 30 years in prison. While such an extreme sentence seems rare, Hathaway should expect some time in custody. Former federal prosecutor Lloyd Meyer of Chicago believes it “would be unthinkable to have this type of defendant get a slap on the wrist.”

Governor Rick Snyder plans to appoint a replacement. Last year, the Michigan Judicial Selection Task Force made a recommendation for the process, suggesting that when a vacancy occurs on the Michigan Supreme Court, a non-partisan panel should screen candidates and then submit three to five choice from which the governor could choose. As of late, Governor Snyder is conducting his own search, hoping to appoint a replacement sooner rather than later.

Chief Justice Young called the scandal one that “diminishes the public’s trust in government.” Hopefully, Synder’s newest appointee will help to rebuild this trust.

 

If you have questions about criminal matters, fraud or other legal issues, please contact Mark Mandell or Tariq Hafeez at 248.380.0000 or online at www.MichiganFraudLawyer.com.

 
To learn more and read the original article, please visit: http://www.clickondetroit.com/news/Michigan-Justice-Diane-Hathaway-retires-amid-bank-fraud-charges/-/1719418/18211054/-/msqdmv/-/index.html

Store Owner Sentenced in Food Stamp Fraud

Mark Mandell, Esq.

The Bridge Card is debit-card like device in use today that electronically tracks food stamp benefits for those in need at the hand of taxpayer dollars. For Noha Fofana and Akhir McFarland, however, the bridge card represented an opportunity to pull in revenue at the Mandingo African Market.

Fofana and others at the Mandingo African Market would obtain card numbers and call them into the store, where they would be manually entered into the system allowing for the transference of benefits from the card to the store’s bank account. U.S. Attorney Barbara McQuade says that Fofana, the owner of Mandingo African Market, pulled in more than $750,000 in food stamp benefits from February 2009 to July 2011. State officials have calculated Mandingo’s average food stamp redemption amount - $26,798 per month – which stands in stark contrast to other convenience stores in the area that only redeem approximately $5,479.

As a result of the fraudulent scheme, Fofana was sentenced to four years, three months in prison. Moreover, U.S. District Judge Mark Goldsmith ordered Fofana to pay $612,980.96 in restitution to the USDA-Food and Nutrition Service.

“We hope that other merchants will become aware of prosecution like this one and be deterred from engaging in similar fraud schemes,” McQuade said.

If you have any questions about criminal or fraudulent activity, contact Mark Mandell or Tariq Hafeez of Fausone Bohn, LLP at (248) 380-0000.

To learn more and read the original article, please visit: http://detroit.cbslocal.com/2013/01/12/store-owner-sentenced-in-612000-food-stamp-fraud/

 

Alleged $22 Million Home Health Care Fraud Scheme

Tariq Hafeez, Esq.
 

Detroit-area and Chicago-area residents were arrested on Thursday, January 18, 2013 by federal agents on charges arising from the ongoing investigation into an alleged $22 million home health care fraud scheme. The indictment was announced by the US Attorney’s Office, the FBI Detroit Field Office, and the Health and Human Services Office of Inspector General (HHS-OIG).

 The 18-count indictment names seven individuals who allegedly participated in a Medicare fraud scheme operating out of four Oakland County, Michigan, home health agencies claiming to provide in-home health services. Defendants are charged with conspiracy to commit health care fraud, health care fraud, conspiracy to violate the Anti-Kickback Statute, and money laundering allegedly defrauding Medicare/Medicaid of $22 million.

The charges of health care fraud conspiracy and health care fraud each carry a maximum potential penalty of 10 years in prison and a $250,000 fine. The charge of conspiracy to violate the Anti-Kickback Statute carries a maximum potential penalty of five years in prison and a $25,000 fine. The charge of conspiracy to commit money laundering carries a maximum potential penalty of 20 years in prison and a $500,000 fine.

Fausone Bohn LLP attorneys have provided aggressive legal defense counsel to individuals and companies charged with federal health care fraud the firm has been retained by one of the defendants in the above matter.

If you have questions about Medicare or Medicaid fraud, or other legal issues, please contact Mark Mandell or Tariq Hafeez at 248.380.0000 or online at www.MichiganFraudLawyer.com.

Mandell Sways Judge: Felony Charges Against Ex-McCotter Staffers Dropped

Mark Mandell took a firm stance against the felony charges brought against Paul Seewald, who previously pleaded guilty in November to nine misdemeanor counts of falsely signing a nominating petition as a circulator. Judge Marie Braxton ultimately determined, however, that “there was no conspiracy involved” – dismissing the felony charges of conspiracy against both Seewald and Don Yowchuang in what’s believed to be the most extensive petition fraud case ever charged by the state.

 

“Why would they do it? Why would they take such a chance?” Mandell asked, pointing out the nature of the petitions. Rather than plotting to fraudulently doctor petition signatures, the men’s actions possessed a last minute-like quality: “a series of decisions during panicked moments.”

The felony count could have cost both men up to five years behind bars. Now, while the staffers may not be facing prison time for their actions, their pleas for misdemeanor charges have resulted in repercussions: Seewald has been sentenced to two years of probation while Yowchuang will serve three. Both ex-staffers will also be required to fulfill countless hours of community service.

Attorney General Bill Schuette responded to the sentencing: “The message here is very clear – if you break the law, there are consequences. We’ll review the dismissal of the conspiracy charge and make a decision about appeal.”

Mandell, however, said that “the attorney general overreached by charging low-level staffers with felonies to look tough on election law. The fact is, Mr. Seewald is not guilty of a felony.” Seewald, while thankful for the community support that he has received, said that he now must look to the future in an attempt to rebuild a life – and image – left damaged by the scandal.

To learn more and read the original article, please visit: http://www.detroitnews.com/article/20130118/METRO01/301180405/1361/Ex-McCotter-staffers-seek-to-have-fraud-charges-dismissed