Friend Of Pfizer Employee Pleads Guilty To Insider Trading Based On Non-Public Drug Trial Results For COVID-19 Treatment

 

Damian Williams, the United States Attorney for the Southern District of New York, announced the guilty plea today of ATUL BHIWAPURKAR in connection with an insider trading scheme to reap illicit profits from inside information about the results of clinical trials of Paxlovid, a medicine used to treat COVID-19.  BHIWAPURKAR was arrested in June 2023 and pled guilty to securities fraud based on insider trading before U.S. Magistrate Judge James L. Cott. 

U.S. Attorney Damian Williams said: “Bhiwapurkar admitted in court that he received sensitive, non-public information about a confidential drug trial from his friend, an employee at Pfizer, so he could profit on that information.  The prosecution of those who steal and misuse confidential information to profit at the expense of other market participants continues to be a top priority of our Office, and people who engage in insider trading will be caught and held accountable.” 

According to the allegations in the Indictment and statements made during court proceedings:

In November 2021, BHIWAPURKAR participated in an insider trading scheme to reap illicit profits from options trading based on inside information about the results of clinical trials of Paxlovid, a medicine used to treat COVID-19.  BHIWAPURKAR was provided material, non-public information about the Paxlovid trial by an employee of Pfizer who assisted in managing the data analysis in certain clinical drug trials. 

On November 4, 2021, prior to the public announcement that a Pfizer trial of the drug Paxlovid, a medicine designed to treat mild to severe COVID‑19 infection, had produced positive results, BHIWAPURKAR received a tip from a Pfizer insider with confidential information about the positive results and the timing of the upcoming press release.  On that same day, BHIWAPURKAR purchased short-dated, out-of-the-money Pfizer call options that expired days and weeks later.  BHIWAPURKAR also tipped another friend (“Individual-1”), who similarly purchased short-dated, out-of-the-money Pfizer call options that expired approximately three weeks later.

The following day, on November 5, 2021, and before the market opened, Pfizer publicly released results of its Paxlovid study.  That same day, following the publication of the positive results, Pfizer’s stock price increased substantially, opening — and eventually closing — more than 10% higher than the prior day’s closing price.  In the following weeks, BHIWAPURKAR and Individual-1 sold their Pfizer call options at significant profits.

BHIWAPURKAR, 45, of Milpitas, California, pled guilty to one count of securities fraud, which carries a maximum sentence of 20 years in prison.

The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  BHIWAPURKAR will be sentenced by U.S. District Judge Andrew Carter.

Mr. Williams praised the outstanding work of the Federal Bureau of Investigation.  Mr. Williams also thanked the U.S. Securities and Exchange Commission, which has filed a parallel civil action.

Attorney General James Sues Cryptocurrency Companies Gemini, Genesis, and DCG for Defrauding Investors

 

Sweeping Lawsuit Details How Genesis and DCG Concealed $1.1 Billion in Losses and Alleges Gemini Repeatedly Lied to Investors

AG James Seeks Restitution for Hundreds of Thousands of Investors Who Lost More Than $1 Billion

New York Attorney General Letitia James today filed a sweeping lawsuit against cryptocurrency companies Gemini Trust Company (Gemini), Genesis Global Capital, LLC and its affiliates (Genesis), and Digital Currency Group, Inc. (DCG) for defrauding more than 230,000 investors, including at least 29,000 New Yorkers, of more than $1 billion. An investigation by the Office of the Attorney General (OAG) found that Gemini lied to investors about an investment program it ran with Genesis called Gemini Earn. Gemini repeatedly assured investors that investing with Genesis through their Gemini Earn program was a low-risk investment. However, OAG’s investigation found that Gemini’s internal analyses of Genesis showed that the company’s financials were risky. The lawsuit alleges that Gemini knew Genesis’ loans were undersecured and at one point highly concentrated with one entity, Sam Bankman-Fried’s Alameda, but did not reveal this information to investors.

The lawsuit also charges Genesis, its former CEO Soichiro Moro, its parent company, DCG, and DCG’s CEO Barry Silbert with defrauding investors and the public by trying to conceal more than $1.1 billion in losses, which were borne by investors. As a result of these misleading claims and deceptions, thousands of investors lost millions of dollars and, in some instances, lost their lifesavings. Through this lawsuit, Attorney General James seeks to ban Gemini, Genesis, and DCG from the financial investment industry in New York, and seeks restitution for investors and disgorgement of ill-gotten gains.

“These cryptocurrency companies lied to investors and tried to hide more than a billion dollars in losses, and it was middle-class investors who suffered as a result,” said Attorney General James. “Hardworking New Yorkers and investors around the country lost more than a billion dollars because they were fed blatant lies that their money would be safe and grow if they invested it in Gemini Earn. Instead, Gemini hid the risks of investing with Genesis and Genesis lied to the public about its losses. This fraud is yet another example of bad actors causing harm throughout the under-regulated cryptocurrency industry. My office will continue our efforts to stop deceptive cryptocurrency companies and push for stronger regulations to protect all investors.”

Impact on Investors 

Gemini, Genesis, and DCG’s fraud led to roughly $1 billion in losses for more than 230,000 investors, including at least 29,000 New Yorkers. One of the New York investors harmed by Gemini Earn was a retired 73-year-old grandmother, who invested her and her husband’s lifesavings of over $199,000 in Gemini Earn because they believed Gemini’s marketing statements that it was a safe and secure choice. The investor had hoped to use this money to pay for her grandchild’s education, but lost it all because of this fraud.

Another Gemini Earn investor, a 56-year-old New Yorker, invested and lost approximately $20,500 in Gemini Earn, virtually all his savings. He chose Gemini Earn because he researched the product and came to believe, based on Gemini’s statements, that Gemini Earn was more secure than other interest-bearing cryptocurrency investments.

Gemini Fraud

Gemini is a New York-based digital asset platform that allows investors to buy and sell cryptocurrencies. In February 2021, Gemini launched an investing program with Genesis called Gemini Earn, in which Genesis generated profits for investors by lending assets to third parties and returning a portion of those profits to investors. When launching Gemini Earn, Gemini told investors that it had vetted Genesis through a risk management framework and that it was a trusted company. However, OAG found that Gemini’s internal risk analyses of Genesis showed that loans to the company were risky.

The lawsuit alleges that from the start of the Gemini Earn program in February 2021 through November 2022, Gemini’s internal risk analyses showed that Genesis’ loan book was risky and highly concentrated in a small number of counterparties. At one point, Sam Bankman-Fried’s Alameda was the borrower for nearly 60 percent of all outstanding loans from Genesis to third parties. Only a year into the program, in February 2022, Gemini revised its estimate of Genesis’ credit rating from BBB (investment grade) to CCC (junk grade) but did not publicly reveal to investors that it downgraded its rating and continued to market Earn as low-risk.

The OAG investigation also found that in July 2022, Gemini’s board of managers discussed ending the Gemini Earn program because of the risks associated with Genesis, and one board member even compared Genesis’ financial condition to that of Lehman Brothers before its collapse. In addition, in the summer of 2022 Gemini risk personnel withdrew their own investments from Earn. Gemini nevertheless failed to provide its investors with any meaningful warnings about these risks.

Genesis and DCG Fraud

While Gemini failed to inform and protect investors of the risks associated with investing with Genesis through the Gemini Earn program, the lawsuit alleges that Genesis tried to conceal more than $1.1 billion in losses from its investors, Gemini, and the public. In June 2022, one of Genesis’ largest borrowers, Three Arrows Capital, defaulted on billions in loans. Around the same time, Genesis lost more than $100 million from another borrower, Babel Finance. In total, Genesis had lost more than $1.1 billion.

The lawsuit charges that Genesis failed to adequately audit its borrower, Three Arrows Capital. In addition, Genesis lied to Gemini when it claimed to regularly review its borrowers’ financial statements. Instead, OAG found that Genesis had not received audited financial statements from Three Arrows Capital for more than two years.

The OAG also found that Genesis, DCG, and their executives tried to conceal Genesis’ true financial condition from Gemini, Gemini Earn investors, and the public. To conceal these losses, DCG and Genesis entered into a $1.1 billion promissory note, in which DCG agreed to pay Genesis $1.1 billion in a decade at only a one percent interest rate. The lawsuit states that the promissory note was part of a scheme to defraud Gemini Earn investors and the public about Genesis’ financial condition and its ability to operate its business.

During the time that Genesis suffered these losses, Genesis, DCG, DCG’s CEO, Silbert, and Genesis’ CEO, Moro, conspired to falsely represent Genesis’ financial condition to the public and Gemini. Two days after the Three Arrows Capital default, Genesis and DCG tweeted, “Despite continued heightened market volatility, the Genesis balance sheet is strong and our business is operating normally.” In addition to making misleading public statements, Genesis’ executives repeatedly lied to Gemini risk management teams about the company’s financial condition.

When Gemini requested additional information about Genesis’ financial condition, Genesis continued to conceal and suppress information that would have revealed the promissory note and the true extent of its losses. For example, in July 2022, Genesis’ CFO directed Genesis personnel to tell its counterparties that the notes to Genesis’ balance sheet, which would have explained the promissory note and its impact on Genesis’ ​balance sheet, would not be available until the end of the year. However, in a Microsoft Teams chat she confessed to her co-workers that the “real reason” why Genesis would not provide these footnotes was because “[i]n the notes, we are required to disclose a lot of things [w]hich will highlight what happened.” In another Microsoft Teams chat, the same CFO explained to coworkers that without the notes, other companies would not know about the promissory note from the balance sheet alone.

Genesis not only made false statements to Gemini, but also presented false reports to conceal its losses. From July 2022 to November 2022, Genesis provided reports to Gemini that listed the value of Genesis’ “current assets.” A “current asset” is one that can be reduced to cash or cash equivalents within the course of one year. The reports misleadingly categorized the fraudulent promissory note as a current asset, even though it was payable ten years later.

Through this lawsuit, Attorney General James is seeking to permanently stop Gemini, Genesis, DCG, and its executives from engaging in any business related to the purchase and sale of securities and commodities within or from New York. In addition, Attorney General James seeks restitution for all defrauded investors and disgorgement of all ill-gotten gains.

Today’s lawsuit is the latest action taken by Attorney General James to rein in the cryptocurrency industry and protect investors. Attorney General James announced sweeping cryptocurrency legislation that will increase regulations of the cryptocurrency industry to protect New York investors. In June, Attorney General James recovered more than $1.7 million from CoinEx for failing to register as a securities and commodities broker-dealer and for falsely representing itself as a crypto exchange. Also in May, Attorney General James secured $4.3 million from Coin Cafe for failing to register as a commodity broker-dealer and defrauding investors. In March, Attorney General James also brought a lawsuit against KuCoin for failing to register as a securities broker or dealer or commodities broker-dealer with OAG. In January, Attorney General James and a multistate coalition recovered $24 million from the cryptocurrency platform Nexo for operating illegally. Attorney General James also sued the former CEO of Celsius for defrauding investors and concealing the company’s dire financial condition. In March 2022, Attorney General James issued a taxpayer notice to virtual currency investors and their tax advisors to accurately declare and pay taxes on their virtual investments.

In October 2021, Attorney General James directed unregistered crypto lending platforms to cease operations for not registering with the state. In September 2021, Attorney General James and the U.S. Securities and Exchange Commission recovered $479.9 million from GTV Media for failing to register cryptocurrency sales. Also in September 2021, Attorney General James secured a $3 million court judgment against Coinseed. In February 2021, Attorney General James required Bitfinex and Tether to end all trading activity in New York and required iFinex and Tether and their related companies to pay $18.5 million in penalties.

Attorney General James urges New Yorkers who have been affected by deceptive conduct in virtual asset markets to report these issues to OAG. Attorney General James also encourages workers in the cryptocurrency industry who may have witnessed misconduct or fraud to file an online whistleblower complaint with her office, which can be done anonymously.

BRONX MAN INDICTED FOR VEHICULAR MANSLAUGHTER IN KILLING OF 67-YEAR-OLD MAN

Defendant Was Allegedly Speeding, Driving While Impaired on Marijuana and With Suspended License 

 Bronx District Attorney Darcel D. Clark today announced that a Bronx man has been indicted for Vehicular Manslaughter, Criminally Negligent Homicide and other related charges for fatally striking a 67-year-old man with his speeding car as the victim crossed an intersection in Castle Hill.

 District Attorney Clark said, “An elderly man on his way to pray at religious services was killed, allegedly by a driver impaired by marijuana and speeding through an intersection. Negligent, reckless drivers who make our streets deadly will be held accountable.”

 District Attorney Clark said Victor Ramos, 27, of Randall Avenue, the Bronx, was arraigned on October 18, 2023 on second-degree Vehicular Manslaughter, Criminally Negligent Homicide, Operating a Motor Vehicle While Under the Influence of Alcohol or Drugs, second and third  degree Aggravated Unlicensed Operation of a Motor Vehicle, and Administrative Code Violation Right of Way and Vehicle and Traffic Law Drivers to Exercise Due Care, before Bronx Supreme Court Justice Kim Parker. The defendant is due back in court on December 19, 2023. 

 According to the investigation, on September 25, 2023, at approximately 9 p.m. at the intersection of Castle Hill Avenue and Turnbull Avenue, a 1994 Infiniti driven by Victor Ramos at almost twice the speed limit, struck Mohammed Rahman, 67, who was crossing Castle Hill Avenue within the unmarked crosswalk with the right of way. Rahman was propelled into the air by the impact and sustained fatal injuries. The defendant remained on scene and was found to be impaired by drugs, to wit, cannabis (marijuana), and he admitted to smoking a blunt before driving. A check of defendant’s license showed he had active suspensions.

 District Attorney Clark thanked Detective Kevin Long of the NYPD Collision Investigation Squad for his work in the investigation. 

 An indictment is an accusatory instrument and not proof of a defendant’s guilt.

Governor Hochul Signs Legislation to Protect New York Children Attending Youth Camps from Sexual Predators

Legislation S.6063/A.4117 Directs the State Health Department to Search National Sex Offender Database Before New Hires at Youth Camps

Governor Kathy Hochul signed important child protection legislation for families sending their kids to select camps. Legislation S.6063/A.4117 directs the New York State Department of Health to require operators of children's non-regulated camps to search the national sex offender database before hiring an employee or volunteer.

“Keeping our children safe is a top priority for me as Governor of New York,” Governor Hochul said. “I’m proud to sign this legislation into law to ensure that every child who attends camps throughout New York State is protected from predators. With this new law, we will help bring camp operators and families greater peace of mind that our kids are in safe hands.”

Legislation S.6063/A.4117 amends current New York law to require single-purpose day camps and camps regulated by DOH to conduct a national sex offender registry search through the U.S. Department of Justice (DOJ) public database. DOJ’s National Sex Offender Public Website (NSOPW), created in 2005, is the only federal site that links state sex offender registries into one, national search site. Users may search for an individual(s) through known: 1). Name(s); 2). Address; 3). Zip Code; 4). County; or 5). City or Town.

New York State’s registry details (among other data) the determined ‘risk level’ of all individuals listed, determined beforehand by a judge. The type of information available through the site is dependent on where the individual falls between Levels 1, 2, and 3. Public State law requires the New York State Division of Criminal Justice Services to include individuals determined to have a Level 2 or 3 risk of re-offense. More on the New York State Department of Health’s requirements for youth camps can be found here.

MAYOR ADAMS ANNOUNCES CITY HALL, MUNICIPAL BUILDINGS, ICONIC NEW YORK CITY SITES TO BE LIT PURPLE IN HONOR OF DOMESTIC VIOLENCE AWARENESS MONTH

 

New York City Mayor Eric Adams today announced that City Hall and a number of other municipal buildings and iconic sites across the city will be lit purple tonight for the 10^th annual “NYC Go Purple Day,” in recognition of Domestic Violence Awareness Month. The lighting of buildings across the five boroughs will raise awareness and underscore the Adams administration’s commitment to supporting survivors of domestic violence, their families, and communities.

 

“Our administration is addressing domestic and gender-based violence through prevention and intervention efforts across city agencies,” said Mayor Adams. “An integral part of our efforts involves spreading awareness of domestic violence and the resources available to survivors throughout the five boroughs. I invite all New Yorkers to join me during Domestic Violence Awareness Month and let survivors know they are never alone.”

 

“I urge all New Yorkers to join us during Domestic Violence Awareness Month and learn more about the far-reaching effects of domestic, intimate-partner, and gender-based violence,” said Deputy Mayor for Health and Human Services Anne Williams-Isom. “Join the city’s annual campaign and help survivors and their families connect to our comprehensive network of resources to navigate closer to safety and healing.”

 

“Domestic Violence Awareness Month is an opportunity to shine a bright light on the often-overlooked public health crisis of domestic and gender-based violence,” said Mayor’s Office to End Domestic and Gender-Based Violence (ENDGBV) Commissioner Cecile Noel. “Our office takes a coordinated, holistic approach to addressing the needs of survivors and interrupting cycles of violence throughout the city. We are grateful for the support across the Adams administration and the ongoing partnerships with community-based organizations in the anti-violence space, without whom we could not do this work. Join us as we raise awareness of the dynamics and impacts of domestic violence, lift up the stories and experiences of survivors, and share vital information and resources to help keep survivors safe and free from violence.”

 

In addition to City Hall, the following city buildings and iconic New York City sites will be lit up purple tonight at sundown:

 

City Buildings Being Lit Up:

• Bronx County Courthouse: 851 Grand Concourse, Bronx, NY 10451
• The David N. Dinkins Manhattan Municipal Building: 1 Centre Street, New York, NY 10007
• Gracie Mansion: East 88^th Street & East End Avenue, New York, NY 10028
• One Police Plaza: 1 Police Plaza, New York, NY 10038
• Staten Island Borough Hall: 10 Richmond Terrace, Staten Island, NY 10301

Iconic New York City Sites Being Lit Up:

•  One World Trade Center: 285 Fulton Street, New York, NY  10007
• One Bryant Park: 1 Bryant Park, New York, NY  10036
• One Five One: 151 West 42^nd Street, New York, NY 10036

While domestic violence is considered one of the most under-reported crimes, there were 272,484 domestic violence incident reports filed by the New York City Police Department in 2022 — an average of 747 a day. In the same year, there were 85,458 calls to New York City’s 24-hour domestic violence hotline at 1-800-621-HOPE (4673), with 7,648 unique requests for shelter. The NYC Hope website of survivor resources had 101,000 visits — an average of almost 277 visits a day — with 54,300 new visitors.

 

The Adams administration’s commitment to advancing the city’s response to domestic and gender-based violence is supported with multiple innovative strategies and initiatives including:

• The ABCs of Healthy Relationships: ENDGBV has launched “The ABCs of Healthy Relationships” interactive web-based toolkits to help elementary school students develop healthy relationships with their friends and classmates as building blocks for healthier relationships.

• Respect and Responsibility: ENDGBV’s free, non-mandated Abusive Partner Intervention Program for individuals who have caused harm in their intimate relationships uses a trauma-informed curriculum that aims to have participants take accountability, stop causing harm, and change behavior. Programming launched in February 2022 with three city-contracted providers that facilitate introductory sessions and multi-week groups in community and support participants with access to case management and other services.
• Street Harassment Prevention Survey and Resource Guide: The New York City Street Harassment Prevention Advisory Board (SHPAB) recently launched a citywide outreach effort to conduct a survey on the nature, prevalence, and impact of street harassment on New Yorkers. The SHPAB is co-chaired by ENDGBV and the New York City Commission on Gender Equity, which sits within the Mayor’s Office of Equity. This survey will help the advisory board better understand how and where New Yorkers experience street harassment; identify people and communities most at risk; and understand what kind of prevention, education, and training resources city agencies, community members, and individuals can utilize to address this form of violence. The resource guide contains important information on how New Yorkers can prevent and respond to street harassment, including steps people can take both during and following an incident of harassment — either as a target or as a bystander — as well as resources available to support someone who has been harassed.

SENATOR JULIA SALAZAR, SENATOR GUSTAVO RIVERA, AND ASSEMBLYMEMBER EMILY GALLAGHER INTRODUCE LEGISLATION TO ESTABLISH EMERGENCY FUND FOR NEW YORKERS EVACUATING ISRAEL AND PALESTINE

 

Legislation would create a reimbursement fund for the costs of emergency return of New Yorkers traveling home from Israel or Palestine 

State Senators Julia Salazar and Gustavo Rivera alongside Assemblymember Emily Gallagher have introduced a bill, S7716, to allow New York State to financially reimburse New Yorkers evacuating from Israel and the Palestinian territories during the ongoing crisis. 

 

Violence in the region is escalating by the day, along with the impending threat of a wider conflict with devastating impacts. Due to many airlines indefinitely cancelling flights in or out of the region’s airports, hundreds of New Yorkers who were visiting Israel or Palestine have found themselves unable to flee and return safely home to the United States. With commercial air traffic severely limited, the U.S. government arranged for charter flights and/or ships to assist in helping people evacuate the area. However, these arrangements only provided transportation to locations in Europe, without arrangements for lodging or transportation back to the United States. Additionally, the US government has required individuals to agree to reimburse the federal government for the cost of this potentially life-saving transportation.  

The established emergency fund would ensure reimbursement for otherwise unreimbursed expenses incurred relating to travel outside of Israel or Palestine as a direct result of the conflict that began on October 7th. Reimbursement will include costs relating to travel, lodging, lost personal property, medical care, other related expenses, and reimbursement provided to the United States government for such travel. 

Attorney General James Leads Coalition of 18 Attorneys General in Calling for Mental Health and Substance Use Disorder Coverage Parity

 

New York Attorney General Letitia James today led a coalition of 18 attorneys general in filing a comment letter urging stronger federal regulations to ensure behavioral health services are covered equally to other types of health care. The Biden Administration has proposed amendments to regulations implementing the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) that would improve compliance with the law and access to mental health and substance use disorder treatment. The comment letter filed by Attorney General James and the coalition supports these efforts and offers recommendations to ensure better health care coverage to millions of Americans impacted by mental health and/or substance use disorders. 

“For too long, Americans struggling with mental health and substance use disorders have faced additional burdens when trying to access affordable care through their health plans,” said Attorney General James. “Health care plans should cover all necessary treatment, and that includes mental health and substance use disorders. I am proud to join my fellow attorneys general in supporting the Biden Administration’s Proposed Rule to strengthen mental health parity requirements and look forward to using this important tool to hold health plans accountable.” 

Since its passage in 2008, MHPAEA has required health plans to cover mental health and substance use disorder treatment the same as medical/surgical treatment, but federal and state audits have shown widespread non-compliance. Under the proposed regulations, health insurers would be required to conduct and disclose to regulators comparative, data-driven analyses of issues impacting access to treatment. These include provider network admission standards, methods for determining reimbursement rates, and procedures for ensuring network adequacy. Additionally, insurers would be required to address and resolve disparities between mental health and substance use disorder and physical health coverage.  

In their letter, Attorney General James and the coalition of attorneys general argue that collecting this data is well within the ability of health insurers and would help identify gaps and compliance red flags. The attorneys general note that health insurers routinely collect data on metrics relevant to MHPAEA compliance as part of their normal business operations, including in- and out-of-network utilization rates, claim submission rates, claim denial rates, reimbursement rates, time and distance standards, and whether providers are accepting new patients. Despite this data collection, numerous independent, peer-reviewed studies have shown that health insurers’ networks of mental health providers are in fact so-called ‘ghost networks’ due to rampant inaccuracies in provider directories. 

Additionally, the letter drafted by Attorney General James and the coalition provides recommendations for strengthening the proposed rule, and urges the federal government to omit or narrow two brand new exceptions that are overly broad and could be used by insurers to avoid providing coverage. Finally, Attorney General James and the coalition urge the relevant government agencies to quickly make the proposed rule effective, given the high level of unmet need for mental health and substance use disorder treatment and health insurers’ repeated compliance failures. The coalition concludes that by removing barriers to access, the regulations would better address America’s mental health and addiction crises. 

Joining Attorney General James in filing today’s letter are the attorneys general of California, Colorado, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, Oregon, Pennsylvania, Rhode Island, Vermont, Washington, and the District of Columbia.                      

Former Oregon Corrections Nurse Sentenced to 30 Years in Federal Prison for Sexually Assaulting Nine Female Inmates

A former Oregon Department of Corrections employee was sentenced yesterday for sexually assaulting nine female inmates while serving as a nurse at the Coffee Creek Correctional Facility, Oregon’s only women’s prison.

Tony Daniel Klein, 38, of Clackamas County, Oregon, was sentenced to 30 years in prison and five years of supervised release. A restitution hearing will be held at a later date.

“The sentence in this case should send a significant message to any official working inside jails and prisons across our country, including those who provide medical care, that they will be held accountable when they sexually assault women inmates in their custody,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “Women detained inside jails and prisons should be able to turn to medical providers for care and not subjected to exploitation by those bent on abusing their power and position. We will listen to and investigate credible allegations put forward by people who are sexually assaulted and, where appropriate, bring federal prosecutions. The Justice Department stands ready to hold accountable those who abuse their authority by sexual assaulting people in their custody and under their care.”

“Today’s sentence sends a clear message that using a position of authority to prey on individuals in custody will never be tolerated by the Justice Department,” said U.S. Attorney Natalie Wight for the District of Oregon. “Holding Tony Klein accountable for his crimes would not have been possible without the courage and resolve of the women he abused and the dedication of our partners at the FBI and Civil Rights Division.”

“We know this prison sentence cannot undo the trauma Tony Klein inflicted on numerous victims, but we hope this brings them one step closer to healing,” said Special Agent in Charge Kieran L. Ramsey of the FBI Portland Field Office. “As a state prison nurse, Klein abused his position and abused multiple women, violating the public’s trust, while doing everything he could to avoid being caught. The investigators and prosecutors should be applauded for their efforts to hold Klein accountable, but we recognize this lengthy sentence is also because of a group of brave women who came forward and helped ensure that Klein was held accountable for being a sexual predator within Coffee Creek Correctional Facility.”

According to court documents, from 2010 until January 2018, Klein served as a nurse at the Coffee Creek Correctional Facility in Wilsonville, Oregon. In his position, Klein interacted with female inmates who either sought medical treatment or worked as orderlies in the prison’s medical unit. Aided by his access to the women and his position of power as a corrections employee, Klein sexually assaulted or engaged in nonconsensual sexual conduct with many female inmates entrusted to his care.

By virtue of his position as a medical provider, Klein was often alone with his victims and assaulted many before, during or after medical treatment. For women who worked in the medical unit, Klein manufactured reasons to get them alone in secluded areas such as medical rooms, janitor’s closets or behind privacy curtains. Klein made it clear to his victims that he was in a position of power over them, and that they would not be believed if they tried reporting his abuse. Fearing punishment if they fought back against or reported his misconduct, most of Klein’s victims submitted to his unwanted advances or endured his assaults.

On March 8, 2022, a federal grand jury in Portland returned an indictment charging Klein with depriving his victims of their constitutional right not to be subjected to cruel and unusual punishment by sexual assault. The indictment also charged Klein with perjury.

On July 25, a federal jury in Portland found Klein guilty of 17 counts of depriving his victims of their constitutional right not to be subjected to cruel and unusual punishment by sexual assault and four counts of perjury.

The FBI Portland Field Office investigated the case.