MAYOR DE BLASIO ANNOUNCES $90 MILLION INVESTMENT IN REDUCING LOW-LEVEL ARRESTS FOR PEOPLE WITH BEHAVIORAL HEALTH NEEDS

Two new drop-off diversion centers will provide short-term stabilizing services for 2,400 people per year, giving police officers a much needed alternative to arrest and jail for individuals with mental health needs who do not pose a risk to public safety

  Mayor de Blasio announced that the City is investing nearly $90 million for two new diversion centers scheduled to open next year. These diversion centers will offer short-term stabilizing services for individuals with mental health and substance use needs, providing police officers the option to bring these individuals to a diversion center as an alternative to arrest. These centers will be able to divert approximately 2,400 people annually who would otherwise be arrested on low-level charges.

The diversion centers are the final piece of the Mayor’s Action Plan on Behavioral Health and the Criminal Justice System. Comprised of 24 interlocking initiatives that stretch across the entire criminal justice system, the Action Plan has helped to reduce the number of people with a mental health diagnosis in city jails by 7 percent in the last two years. The new diversion centers could reduce this number even further.

“These two new diversion centers will provide police officers with a new option for responding to the needs of some of our most vulnerable New Yorkers – instead of making an arrest, police will be able to connect people to the mental health or substance abuse care they need,” said Mayor Bill de Blasio. “Safe alternatives to arrest that give people the tools they need to get back on track are key to our criminal justice reforms and bringing down our jail population.”

“Too many people in our jails do not belong there and can be traumatized by the experience. Those who are struggling with mental illness, substance misuse or addiction don't need to be incarcerated. – they need treatment,” said First Lady Chirlane McCray, who leadsThriveNYC, the city’s mental health reform efforts. “Diversion centers will help people who are not well by connecting them to treatment that can transform their lives.”

“Too often, New Yorkers who struggle with mental health and substance use issues end up in our criminal justice system, when the best path is to connect them to treatment,” said Health Commissioner Dr. Mary T. Bassett. “Opening Diversion Centers builds on the City's commitment to expand mental health services for all residents. I commend Mayor de Blasio for taking a public health approach to reform the criminal justice system.”

“This will provide additional resources for the public, and another tool for the police,” said NYPD Police Commissioner James P. O'Neill. “The goal is that these centers will provide mental health services that were previously unavailable to those who need them most.”  

“For too long, police in New York City and across the country have had very limited options when responding to individuals with behavioral health needs whose behavior violates the law," said Elizabeth Glazer, Director of the Mayor's Office of Criminal Justice. "Police have had to choose between an arrest, which can exacerbate health concerns instead of address them, or an emergency room, which often requires that an officer spend hours at a hospital instead of addressing pressing public safety needs. New York City's significant investment in two new diversion centers is a key piece of solving this problem. For those who do not pose a risk to public safety, officers will now have an effective way to connect individuals with stabilizing care instead of making an arrest. This will improve the fairness of our justice system by ensuring that individuals who need help get help and thus contribute further to the safe reduction in our jail population.” 

The centers will offer a range of clinical and non-clinical services, including overnight shelter and basic need services, such as food, laundry and showers. Clinical services will include health and behavioral health assessments, counseling, advocacy, peer-to-peer engagement services, medication, medically supervised substance use stabilization and withdrawal management services, and naloxone training and distribution.

The centers will operate 24/7 with a no-refusal policy for individuals brought in by the police. Length of stay will vary from hours to days depending on the person’s needs, with a cap of five days. When there is clinical need, such as more supervision of withdrawal services, the stay can be extended to ten days. Once the client is stabilized, the centers will connect them to healthcare, social services and other supports. The centers will not be used as a replacement for permanent housing or long-term shelter for homeless individuals.

The City will award approximately $90 million to two non-profit vendors, Project Renewal and Samaritan Daytop Village, to operate the diversion centers for the next ten years. The contracts will be overseen by the NYC Health Department. Both vendors have decades of experience serving New Yorkers with substance use issues or mental illness. The contracts will begin in June and September. The initiative includes funding and programmatic support from the State Office of Alcoholism and Substance Abuse Services and the State Office of Mental Health. 

The model of the new diversion centers was developed by the NYC Health Department, in consultation with partner agencies. Through ThriveNYC, the most comprehensive mental health plan of any city or state in the country, these centers will offer an innovative alternative to jail or hospitalization for individuals suffering with behavioral health conditions. The diversion centers are also a paired strategy with the City’s ongoing effort to expand training for police officers that will enable them to better recognize the behaviors and symptoms of mental illness and substance use. In the last two years, as part of the Action Plan on Behavioral Health and the Criminal Justice System, the NYPD has integrated Crisis Intervention Training into the police academy curriculum and is on track to provide stand-alone 36-hour training for 5,500 officers by early 2018.

The two centers are expected to open in early and late 2018, respectively. The facilities will be located in two areas with need and a high concentration of police officers who have been trained in how to deescalate interactions with individuals with behavioral health needs. Specific locations will be announced later this year. 

“Project Renewal is proud to have been selected to develop and manage a critically needed diversion center.  We applaud Mayor de Blasio for his innovative actions to improve New York City's approach to serving people with mental health issues.  The two diversion centers show New York City is fully committed to treating mental health and substance use disorders as health issues, rather than criminal justice matters.  We will bring the same dedication to care and compassion for our clients to this program that have been the hallmark of Project Renewal since its founding 50 years ago. The diversion center will afford us another opportunity to restore hope and renew the lives of even more New Yorkers,” said Mitchell Netburn, President and CEO of Project Renewal.

“Samaritan Daytop Village is pleased to do our part to reduce admissions to Rikers Island by diverting people brought to us by the police department who are experiencing non-emergency psychiatric and drug use issues and instead providing crisis intervention and treatment to promote stability,” said Tino Hernandez, President and CEO of Samaritan Daytop Village.

Over the last 20 years, New York City has experienced the sharpest drops in crime anywhere in the nation, while also substantially reducing jail populations. However, on any given day in New York City jails, approximately 11 percent of those detained have a serious mental illness, 40 percent from a broader array of mental issues, and more than 85 percent have substance use disorders.  Despite the high percentages, the overall number of individuals in city jails has fallen in the last two years since implementation of the Mayor’s Action Plan on Behavioral Health and the Criminal Justice system began.

Wave Hill Events May 26–Jun 2

  Often a turning point signifying the transition from spring to summer, Memorial Day is a wonderfully long weekend at Wave Hill. Please join us!

SAT, MAY 27    FAMILY ART PROJECT: PALISADES IN PLASTER

Take a look at the rock formations that make up the magnificent cliffs of the Palisades that face Wave Hill. What minerals make up the soil around us? Use plaster made from the mineral gypsum to create your own sculptural rock formation, and tint with your choice of color. Easy for kids of all ages! Free, and admission to the grounds is free until noon. 

WAVE HILL HOUSE, 10AM‒1PM

SAT, MAY 27    GARDEN HIGHLIGHTS WALK

Join us for an hour-long tour of seasonal garden highlights. Free, and admission to the grounds is free until noon.

MEET AT PERKINS VISITOR CENTER, 11AM

SAT, MAY 27    GALLERY TOUR

Wave Hill’s Curatorial Fellow will lead a tour of the spring exhibitions in Glyndor Gallery. The group show,Outcasts: Women in the Wilderness, explores how women have been treated and portrayed as outcasts in history, myth and biblical legend. In the Sunroom Project Space, Borinquen Gallo’s imaginary hive interior is informed by Wave Hill’s beehives. Free with admission to the grounds.

GLYNDOR GALLERY, 2PM

SUN, MAY 28    FAMILY ART PROJECT: PALISADES IN PLASTER

Take a look at the rock formations that make up the magnificent cliffs of the Palisades that face Wave Hill. What minerals make up the soil around us? Use plaster made from the mineral gypsum to create your own sculptural rock formation, and tint with your choice of color. Easy for kids of all ages! Free with admission to the grounds. 

WAVE HILL HOUSE, 10AM‒1PM

SUN, MAY 28    GARDEN HIGHLIGHTS WALK

Join us for an hour-long tour of seasonal garden highlights. Free with admission to the grounds.

MEET AT PERKINS VISITOR CENTER, 2PM

MON, MAY 29    MEMORIAL DAY

Wave Hill is open.

MON, MAY 29    GARDEN HIGHLIGHTS WALK

Join us for an hour-long tour of seasonal garden highlights on this holiday Monday. Free with admission to the grounds.

MEET AT PERKINS VISITOR CENTER, 2PM

TUE, MAY 30    GARDEN HIGHLIGHTS WALK

Join us for an hour-long tour of seasonal garden highlights. Free, and admission to the grounds is free until noon.

MEET AT PERKINS VISITOR CENTER, 11AM

A 28-acre public garden and cultural center overlooking the Hudson River  and Palisades, Wave Hill’s mission is to celebrate the artistry and legacy of its gardens and landscape, to preserve its magnificent views, and to explore human connections to the natural world through programs in horticulture, education and the arts.

HOURS  Open all year, Tuesday through Sunday and many major holidays: 9AM–5:30PM, starting March 15.  Closes 4:30PM, November 1–March 14.

ADMISSION  $8 adults, $4 students and seniors 65+, $2 children 6–18. Free Saturday and Tuesdaymornings until noon. Free to Wave Hill Members and children under 6.

PROGRAM FEES  Programs are free with admission to the grounds unless otherwise noted.

Visitors to Wave Hill can take advantage of Metro-North’s one-day getaway offer. Purchase a discount round-trip rail far and discount admission to the gardens. More at http://mta.info/mnr/html/getaways/outbound_wavehill.htm

DIRECTIONS – Getting here is easy! Located only 30 minutes from midtown Manhattan, Wave Hill’s free shuttle van transports you to and from our front gate and Metro-North’s Riverdale station, as well as the W. 242nd Street stop on the #1 subway line. Limited onsite parking is available for $8 per vehicle. Free offsite parking is available nearby with continuous, complimentary shuttle service to and from the offsite lot and our front gate. Complete directions and shuttle bus schedule at www.wavehill.org/visit/.

Information at 718.549.3200. On the web at www.wavehill.org.

TUESDAY MAY 23: CITY RESOURCE FAIR TO BE HELD IN THE BRONX

  On Tuesday, May 23, Mayor Bill de Blasio and Bronx Borough President Ruben Díaz, Jr. will host a City Resource Fair during City Hall in Your Borough week. Top representatives from City Hall, the Department of Transportation, Department of Finance, NYPD, Economic Development Corporation, Department of Education, Department of Health, Small Business Services, Department of Parks and Recreation, among others, will be available to answer Bronx residents’ questions. 

Bronxites can sign up to attend via at nyc.gov/Bronx or call (212) 748-0281.

WHAT:           City Hall in Your Borough: City Resource Fair

WHEN:           Tuesday, May 23, 2017

9:00 A.M. – 1:00 P.M.

WHERE:         The Bronx County Building

Veterans’ Memorial Hall

                        851 Grand Concourse

                        Bronx, NY 10451

MAYOR DE BLASIO, CHANCELLOR FARIÑA AND DEPUTY MAYOR BUERY ANNOUNCE 69 NEW COMMUNITY SCHOOLS

Total of 215 Community Schools will serve over 108,000 students across the city

  Mayor Bill de Blasio, Schools Chancellor Carmen Fariña and Deputy Mayor Richard Buery today announced the expansion of the Community Schools Initiative to 69 new schools this September, providing students with expanded learning opportunities, robust family engagement, an explicit focus on social-emotional development, and enrichment programming through partnerships with community based organizations (CBOs).

This expansion will bring the total number of Community Schools citywide to 215, exceeding the City’s original projection of 200 Community Schools by 2017. The new 69 Community Schools are funded through the 21st Century Community Learning Center (21CCLC) grants, which awarded $25.5 million per year for up to five years.

New York City is the largest Community Schools system in the nation. In September 2017, more students will be enrolled in NYC Community Schools than the entire student populations of Baltimore or Denver. The Community Schools Initiative recognizes that in order for students to achieve academic excellence, schools must support the whole child, as well as their family.  This research-based model provides an integrated focus on academics, health and mental health services, youth development, expanded learning opportunities, and family supports are critical to improving student success.

“Equity and Excellence is about evening the playing field for our students, and Community Schools help to do just that,” said Mayor Bill de Blasio. “To reach success in their classes, our students often require some extra support outside the classroom. This expansion allows us to provide additional after school activities, mental health counseling, enhanced family engagement, and so much more.”

“It’s essential that we invest in the whole child, and through the Community School model, we are bringing additional social emotional supports, mental health services, and deepening family ties,” said Schools Chancellor Carmen Fariña. “Schools are anchors for the entire community, and by embedding high quality Community Based Organizations into schools, we can meet the needs of students and families. With this expansion, these game-changing resources will benefit more than 108,000 students in all five boroughs.”

“For students to be successful, they and their families must have access to a full range of resources that support everything from financial stability to strong physical and mental health. A great school not only recognizes this, but is able to integrate these services into the very fabric of the way that school operates,” said Deputy Mayor for Strategic Policy Initiatives Richard Buery. “The community school model makes it possible for every school to be a great school. The expansion to 69 new schools this fall will knock down more barriers to high student performance in classrooms across the City and better position kids to succeed in school and in life.”

“The Assembly Majority has been a fierce advocate for community schools because we recognize the importance of taking a holistic approach to education,” said Assembly Speaker Carl Heastie. “By addressing all the needs that students have from health and emotional support to family engagement, we can be sure that students have the greatest chance of being successful. More community schools means more opportunities for our students to succeed.”

Community Schools provide a range of resources, with the core elements being: expanded learning time, health and wellness services, enhanced family and community engagement and targeted attendance improvement strategies. The core structure of a Community School includes a defined community partnership with a community-based organization (CBO), a dedicated Community School Director, shared leadership and accountability and enhanced data tracking to preemptively address challenges like absenteeism. Based on the local need, and availability of additional resources, Community Schools may also offer a range of services, including School-Based Health Centers, vision screenings, food pantries and adult education courses.

Additionally, the Community Schools Initiative plays an important role in Renewal School initiative. Hand-in-hand with targeted academic interventions, each Renewal School is a Community School. This work addresses challenges of poverty, chronic absenteeism, health challenges so students and staff can focus on improving academic outcomes.

           

The Coalition for Community Schools— an alliance of national, state and local organizations in education – has also selected the New York City Community Schools Initiative for its 2017 Awards for Excellence. They also recognized PS 188, The Island School, for one of three Individual Community School Awards.

This citywide expansion includes 25 CBO partners at the 69 schools. CBOs were selected by schools, based on proven experience working in the community, demonstrated capacity to coordinate partners and deliver comprehensive services through a dedicated on-site Community School Director.

In the Fall of 2016, the NYS Education Department released a RFP for 21st Century Community Learning Center (21CCLC) Funding. NYSED allocated $47.9 Million in 21CCLC funding to NYC, with $25.5 million awarded to the NYC DOE directly and additional $22.4 million awarded to non-governmental organizations. The 21CCLC grant supports school-CBO partnerships, afterschool and youth development and the DOE aligned proposals with the Community School Strategy to ensure that funding will support expansion. The Office of Community Schools worked with Superintendents to identify schools that met the priorities of each proposal and demonstrated capacity to partner with CBOs.

Community Schools are funded in a range of ways across the City. Through the 21st Century Community Learning Center grant, through an AIDP grant and through NYS Foundation Aid and City Funds.

This work is also supported through a host of public-private partnerships and the philanthropic support of the Wallace Foundation and others as facilitated by the Fund for Public Schools; the New York Community Trust, via the National Center for Community Schools; and through the generosity of Bank of America Charitable Foundation, Warby Parker, and the Annie E. Casey Foundation. 

YOUTH SPEAKS CONFERENCE URGES TEENS TO FOLLOW THEIR DREAMS

  The auditorium at the Richard Green MS 113 Campus was transformed with today’s community leaders reciting poetry, recalling their experiences of overcoming bias and inequality and encouraging the more than 700 youngsters in the audience for the 11th annual YOUTH SPEAKS conference to follow their dreams.

Hosted by the Bronx Youth Empowerment Program (YEP) in partnership with NYC Council Member Andy King, the teens received insight on what it’s like to become an actor, police officer, professional basketball player, a school administrator, compete in the Olympics or start their own business.

Fifteen schools throughout the 12th Council District participated in Wednesday’s conference. The theme was equality and a short video on the U.S. Constitution’s Three-Fifth Clause was shown.

“The Three-Fifth Clause still affects us today,” said Bronx YEP member Amear Rattray, a junior at the High School for Contemporary Arts, about struggles and inequality in communities of color.

Members of Bronx YEP led the question and answer session with panelists City Schools Chancellor Carmen Farina, Fred Mwangaguhunga, Silver-Medal Olympian Daryl Homer, Actor L. Steven Taylor, who plays the part of Mufasa in The Lion King on Broadway and his fellow cast members, Lt. Sanders of the 47th Precinct; and Kevin “Butter” Johnson, who plays professional basketball in Australia.

“Follow your journey,” said Johnson, who told students about his experience as special education student in school. “Through it all, I followed my journey in basketball and I have an amazing life traveling across the world.”

Prior to the panel discussion, Chancellor Farina was surprised by members of Bronx YEP and the Council Member King with the presentation of the 12th District Council Real Leadership Award in honor of her more than 50 years of leadership in New York City schools.

Acting U.S. Attorney Announces $54 Million Settlement Of Civil Fraud Lawsuit Against Benefits Management Company For Improper Authorization Of Medical Procedures

CareCore Admits to Improperly Authorizing Over 200,000 Procedures Paid For With Medicare and Medicaid Funds

  Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and Scott Lampert, Special Agent in Charge of the New York Regional Office for the Office of Inspector General for the Department of Health and Human Services (“HHS-OIG”), announced today that the United States simultaneously filed and settled a civil fraud lawsuit against benefits management company CaRECORE NATIONAL LLC (“CARECORE”), now part of eviCore healthcare, for authorizing medical diagnostic procedures paid for with Medicare and Medicaid funds over a period of at least eight years without properly assessing whether the procedures were necessary or reasonable. The settlement, approved in Manhattan federal court by U.S. District Judge Richard J. Sullivan, resolves CARECORE’s civil liabilities to the United States under the federal False Claims Act. Under the settlement, CARECORE must pay a total of $54 million, of which $45 million will be paid to the United States and $9 million will be paid to the states that are named as plaintiffs in the suit. CARECORE also admitted and accepted responsibility for, among other things, improperly approving prior authorizations requests for hundreds of thousands of diagnostic procedures paid for with Medicare Part C and Medicaid funds.

Acting U.S. Attorney Joon H. Kim said: “Benefit management companies are supposed to determine whether medical diagnostic procedures paid for with Medicare and Medicaid funds are necessary and reasonable. Instead, CareCore blindly approved hundreds of thousands of medical procedures over a period of many years, leaving Medicare and Medicaid to foot the bill. This lawsuit and settlement shows our commitment to ensuring that fraud and waste involving federal funds will be identified and stopped.”

HHS-OIG Special Agent in Charge Scott J. Lampert said: “CareCore’s irresponsible behavior compromised the integrity of the Medicare and Medicaid programs, and wasted millions of taxpayer dollars. HHS-OIG will continue to ensure that companies that do business with federally-funded health care programs do so in an honest fashion.”

The United States Complaint-In-Intervention (the “Complaint”) alleges that starting in as early as 2005, CARECORE, which performs prior authorization review for diagnostic procedures on behalf of many insurers, including those providing insurance through Medicare Part C and Medicaid Managed Care, was unable to review prior authorization requests in a timely fashion, and in order to avoid contractual penalties for failing to timely process the requests, CARECORE instituted a practice of improperly approving prior authorization requests. By 2007, CARECORE had formalized this practice into the “PAD program.” Between 2007 and 2013, through the PAD program, CARECORE improperly authorized over 200,000 diagnostic procedures.

As part of the settlement, CARECORE must pay $54,000,000 to resolve both federal and state false claims act claims, the latter of which will be the subject of a separate settlement agreement between CARECORE and the states. In the settlement, CARECORE admits, acknowledges and accepts responsibility for the following conduct:

1. CARECORE provides services to health insurers, including managed care organizations that provide services to beneficiaries of the Medicare Part C and Medicaid programs (collectively, “MCOs”). CARECORE provides prior authorization services, which consist of screening prior authorization requests for certain procedures for medical reasonableness and necessity. During the times pertinent to this matter, CARECORE’s Clinical Reviewers, who generally were nurses, received information from the treating physicians and input that information into CARECARE’s proprietary software system. That software system, based on the information provided, either recommended approval of the prior authorization or recommended further review by a physician.

2. Under the applicable regulations and contractual provisions, if a plan decides to implement prior medical necessity review in order to cover physician-ordered services, only a physician or other appropriate health care professional with sufficient expertise has the authority to deny a procedure. Thus, if a prior authorization could not be issued based on the information currently supplied by the treating physician, the prior authorization request, including all of the related information, was placed in an electronic queue, the Medical Review Queue. The prior authorization request could be accessed in the Medical Review Queue by a CAERCORE Medical Director, who is a physician retained by CARECORE, who would review the information and determine whether to conduct a peer call with the treating physician or appraise information gathered after the initial request in order to determine whether prior authorization of the procedure was appropriate, or should be denied.

3. In order for the MCOs to meet timelines in the applicable regulations and/or pursuant to its contractual obligations and provisions, CARECORE was required to issue a determination on prior authorization requests within fixed time periods known as “Turn Around Times,” or “TATs”, often as little as 4 hours for urgent requests, and 48 hours for non-urgent requests. CARECORE was also subject to contractual monetary penalties if it failed to maintain performance standards, including meeting the processing deadlines set forth in the regulations and contracts.

4. Starting in at least 2007, CARECORE developed the “Process As Directed,” or “PAD” Program. Under the PAD Program, CARECORE’s Clinical Reviewers would approve certain prior authorization requests awaiting physician review that had been on the queue for nearly the entire applicable TAT. The PAD Program consisted of Clinical Reviewers improperly approving certain prior authorization requests on the Medical Review Queue without having obtained any new objective medical information about the request, and without a Medical Director having independently reviewed the prior authorization request. These prior authorization requests (“padded requests”) were then transmitted to CARECORE’s client insurers, including MCOs, as preauthorized requests.

5. In 2007, the PAD Program was formalized into corporate policy, which included detailed training materials and daily reporting of the number of padded requests to high-level executives then-employed at CARECORE. When daily regular review of the Medical Review Queue showed the volume of cases in the Medical Review Queue was too high to make a timely decision for a significant volume of requests for prior authorization, certain Clinical Reviewers were directed by then-management to approve requests for prior authorization without obtaining or considering any new medical information.

6. From 2007 through June 13, 2013, CARECORE padded between 200,000 and 300,000 prior authorization requests.

7. In CARECORE’s role managing the prior authorization process, it had medical information of the beneficiaries seeking prior authorization. When CARECORE approved padded requests, CARECORE made a representation that it had appropriately reviewed the requests when it knew it had not. Thus, those padded requests incorporated CARECORE’s false representation that it had approved a case after completing the required review process. The MCOs thereafter provided coverage based on CARECORE’s approval of the prior authorizations.

8. MCOs would only pay for procedures that require a prior authorization if the prior authorization was granted in a manner consistent with the MCO’s policies and procedures. Thus, the PAD Program resulted in insurance claims related to the padded requests being presented to the MCOs for payment with federal and/or state government funds, and MCOs actually paid insurance claims made in connection with the padded requests.

The Complaint in this case was filed under the federal False Claims Act, which punishes violators who submit false claims or make false statements material to claims submitted to entities administering programs funded by the government. The allegations of fraud stated in the Complaint were first brought to the attention of the government by a whistleblower, who filed a lawsuit under the qui tam provisions of the False Claims Act. Those provisions allow private parties who have knowledge of fraud committed against the government to file suit on behalf of the government and share in any recovery. The United States may then intervene and file a complaint, as it did here.

Acting Manhattan U.S. Attorney And FBI Assistant Director Announce Insider Trading Charges Against Law Firm Partner

  Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today that WALTER C. LITTLE, a/k/a “Chet,” a former partner at an international law firm (the “Firm”), and ANDREW BERKE, a business associate of LITTLE, were arrested this morning and charged with insider trading. LITTLE and BERKE collectively made approximately $1 million in profits in connection with options and stock trading based on material nonpublic information that LITTLE improperly accessed from the Firm’s databases and then provided to BERKE. LITTLE and BERKE were arrested today and presented before a Magistrate Judge in the Middle District of Florida.

Acting Manhattan U.S. Attorney Joon H. Kim said: “Walter Little, a former partner at a major international law firm, allegedly used confidential information – entrusted to the firm by its clients – to illegally trade for personal gain. Although he billed no work for these clients, Little allegedly used his position at the firm to access and share their nonpublic business information. As alleged, Little and Andrew Berke then used that inside information to make approximately $1 million in illegal profits. We continue the fight against illegal insider trading, and are committed, along with our partners at the FBI and the SEC, in ensuring fairness and integrity in our financial markets.”

FBI Assistant Director William F. Sweeney Jr. said: “Little and Berke allegedly used Little’s position at the firm to access material, nonpublic information and engage in insider trading – a scheme that ultimately resulted in collective profits of approximately $1 million. Having access to this type of information is a privilege, one that is extended in furtherance of trusted business-related matters. When clients’ proprietary information is used in this way, they’re not the only ones at risk of losing; keeping our markets fair for all investors remains a top priority for the FBI. We will continue to work with our law enforcement partners to bring charges against those who use illegal and unfair advantages in our securities markets.”

According to the Complaint unsealed today in Manhattan federal court:[1]

Between February 2015 and May 2016, LITTLE was employed at the Firm as a partner. During that time, the Firm provided transactional and regulatory legal advice to a wide variety of corporations, among other services. Clients regularly entrusted the Firm with nonpublic information and the Firm consequently enacted policies requiring its employees to keep such information confidential. LITTLE, however, failed to abide by these policies. Even though he did not perform any billable work for the associated clients, LITTLE accessed documents relating to seven different companies containing material nonpublic information about (1) a client’s anticipated delisting from the NASDAQ stock exchange; (2) multiple clients’ involvement in mergers and acquisitions; (3) multiple clients’ anticipated earnings announcements; and (4) a securities offering being planned by a client. LITTLE then purchased and sold stock and options based on the information contained in these documents, making profits of over approximately $320,000.

In addition to trading on the information himself, LITTLE also provided the information to BERKE, his business associate and friend. BERKE also traded on the information, making profits of over approximately $660,000. For example, on or about July 23, 2015, LITTLE accessed a document on the Firm’s document management system entitled “Revised Merger Agreement,” which contained material nonpublic information about an upcoming merger of a Firm client. The following morning, between approximately 8:31 a.m. and 8:34 a.m., LITTLE and BERKE exchanged approximately six text messages. Approximately an hour later, at 9:41 a.m., BERKE purchased hundreds of shares of stock in the relevant company. The merger referenced in the document that LITTLE had accessed became public approximately three days later, resulting in significant profits for BERKE.

LITTLE, 43, of Tampa, Florida, and BERKE, 49, of Apollo Beach, Florida, are each charged with one count of conspiring to commit securities fraud and six counts of securities fraud. LITTLE is also charged with an additional five counts of securities fraud. The charge of conspiring to commit securities fraud carries a maximum sentence of five years in prison, and each securities fraud count carries a maximum sentence of 20 years in prison. The charges also carry a maximum fine of $5 million, or twice the gross gain or loss from the offense. The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants would be determined by the judge.

Mr. Kim praised the investigative work of the FBI and thanked the SEC, which has filed civil charges in a separate action. He added that the FBI’s investigation is ongoing.

 The allegations contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

 [1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth below constitute only allegations, and every fact described should be treated as an allegation.

Father And Son Pair Charged With Gunpoint Robbery And Kidnapping In Bronx Home Invasion

  Joon H. Kim, the Acting United States Attorney for the Southern District of New York, James P. O’Neill, the Commissioner of the New York City Police Department (“NYPD”), and Ashan M. Benedict, the Special Agent in Charge of the New York Field Office of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”), announced today the filing of a criminal complaint charging JORDANY FRIAS-ROSARIO, a/k/a “Julio,” and PEDRO CASTILLO, a/k/a “Juan Antonio Frias,” with robbery, kidnapping, and use of a firearm during the commission of a crime of violence. As alleged, FRIAS-ROSARIO and CASTILLO committed a home invasion robbery in the Bronx on March 30, 2017, and forcefully tied up two victims, including a 7-year-old boy with autism. FRIAS-ROSARIO was arrested in Utica, New York, this morning and will be presented this afternoon before the Honorable Thérèse Wiley Dancks. CASTILLO is still at large, and the general public is encouraged to contact Crime Stoppers at 800-577-TIPS (800-577-8477) with any information on CASTILLO’s whereabouts.

Acting Manhattan U.S. Attorney Joon H. Kim said: “The defendants are charged with a callous crime of violence. They allegedly terrorized two people at gunpoint during a home invasion robbery, tying up a 7-year-old autistic child and pistol-whipping an adult. We commend our partners at the ATF and NYPD for the exemplary work that led to the charges today.”

ATF SAC Ashan M. Benedict said: “The defendants are alleged to have brazenly and viciously committed a gunpoint home invasion, during which one victim was tied up and violently assaulted in the presence of the second victim, an autistic child, who was also tied up. Such acts of violence and depravity will not be tolerated, and the defendants will now face justice for their actions. I would like to express my gratitude to the ATF Special Agents and NYPD Detectives assigned to the ATF SPARTA Task Force for their hard work throughout this investigation, and the many others in which they are successfully targeting armed robbers for arrest and prosecution. I would also like to thank the United States Attorney’s Office for their continued partnership and dedication in pursuing the prosecution of violent offenders.”

According to the Complaint[1] filed in Manhattan federal court:

On March 30, 2017, JORDANY FRIAS-ROSARIO, a/k/a “Julio,” and PEDRO CASTILLO, a/k/a “Juan Antonio Frias,” committed a home invasion robbery in the Bronx, New York (the “Robbery”). During the course of the Robbery, FRIAS-ROSARIO and CASTILLO brandished a firearm and forcefully tied up two victims (“Victim-1” and “Victim-2”). Victim-1, a 66-year-old man, was pistol whipped, leaving a deep gash over his left ear. Victim-2, a 7-year-old boy with autism, was also tied up during the course of the Robbery.

FRIAS-ROSARIO, 24, of the Bronx, was arrested this morning. CASTILLO, 56, also of the Bronx, is still at large and the general public is encouraged to call Crime Stoppers with any information on CASTILLO’s whereabouts. FRIAS-ROSARIO and CASTILLO are each charged with robbery, kidnapping, and using a firearm during the commission of a crime of violence; the charge carries a maximum sentence of life in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Mr. Kim praised the efforts of the NYPD and ATF in this investigation, specifically the Bronx Robbery Squad and the Joint Robbery Task Force.

The charges contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

 [1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint forth herein constitute only allegations, and every fact described should be treated as an allegation.