LOTS OF ACTION IN BROOKLYN THIS PAST WEEK - SEVERAL BAD ONES

Driver who Allegedly Crashed Car in Brooklyn Highway and Left Passenger for Dead Indicted for Murder

Vehicle Exploded, Defendant Fled Scene in a Cab without Calling 911

  Acting Brooklyn District Attorney Eric Gonzalez today announced that a 23-year-old Brooklyn man has been indicted on depraved indifference murder, vehicular manslaughter and related counts for allegedly causing a car crash on the Gowanus Expressway and fleeing the scene with his passenger stranded inside the burning car, leaving her to die.

Acting District Attorney Gonzalez said, “This defendant’s alleged actions before and after crashing his car caused the death of a vibrant young woman who had her entire life ahead of her. He showed complete disregard for human life and for the safety of everyone using our roadways, making the very serious charges he now faces wholly appropriate.”

The Acting District Attorney identified the defendant as Saeed Ahmad, 23, of Marine Park, Brooklyn. He was arraigned today before Brooklyn Supreme Court Justice Neil Firetog on an indictment in which he is charged with second-degree murder (depraved indifference), second degree vehicular manslaughter, leaving the scene of an accident, driving while intoxicated and related counts. He was ordered held without bail and to return to court on January 12, 2018. The defendant faces up to 25 years in prison if convicted of the top count.

The Acting District Attorney said that, according to the investigation, on October 13, 2017 at approximately 4 a.m., the defendant was driving an Infinity sedan, returning from a night out in Manhattan with a friend, 25-year-old Harleen Grewal.

The defendant was driving in an excessive rate of speed, attempted to pass other vehicles and crashed his car into a side barrier between the Hamilton Avenue and the Prospect Expressway exits, causing it to explode and burst into flames, the evidence showed. He got out of the burning car, got into a cab and left without calling 911 or alerting anyone that the victim was still in the vehicle. She subsequently died and her remains were recovered from the scene after the fire was put out.

The defendant was arrested later that morning and tests determined that his blood alcohol level at the time of the crash was above the legal limit of .08.

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

Woman and Two Men Indicted for Posing as Law Enforcement and Stealing $50,000 from Chat Line Caller in Blackmail Scheme

Allegedly Told “Lavalife” Customer he Chatted with Underage Girl; 

Mastermind Orchestrated Scam while Incarcerated on Similar Charges

  

Acting Brooklyn District Attorney Eric Gonzalez today announced that a woman and two men from Brooklyn have been indicted in connection with a scheme to extort money from a caller to a telephone chat line for singles by posing as NYPD detectives and an Assistant District Attorney. The defendants allegedly called the victim shortly after he chatted with a woman, identified themselves as police detectives and told the victim he was in trouble for talking to an underage girl. They allegedly also placed calls from the purported girl’s mother and from a phony prosecutor while demanding payments – which eventually amounted to over $50,000 – in exchange for not arresting him.

Acting District Attorney Gonzalez said, “These defendants allegedly scammed an unwitting victim out of his retirement savings by posing as law enforcement officials. We are determined to put an end to these types of disgraceful schemes that prey on people’s potential embarrassment and unfamiliarity with the legal system. There may be more victims out there and so I am asking anyone who believes they have been similarly targeted to come forward by calling the DA’s Action Center at 718-250-2340.”

The Acting District Attorney identified the defendants as Magdalena Nixon, 42, formerly of Crown Heights, Sandy DeWalt, 53, of Bedford-Stuyvesant, and Randy Jones, 49, of Brownsville. Nixon and DeWalt were arraigned yesterday before Brooklyn Supreme Court Justice John Hecht on an indictment in which they are charged with two counts of second-degree grand larceny, three counts of second-degree coercion and one count of first-degree criminal impersonation. Jones was arraigned on the same indictment on Monday. The defendants were ordered to return to court on December 13, 2017. They face up to 15 years in prison if convicted on the top count.

The Acting District Attorney said that the scheme involved the telephone chat line “Lavalife Voice.” Callers to that line hear a recorded message the recites terms and conditions of using the service, including a requirement that participants are over 18 years of age. They are then allowed to create a profile before connecting to other singles who are on the line and might want to chat. The defendants allegedly targeted victims by setting up a profile on the chat line, which they used to “meet” male callers and obtain their phone numbers.

It is alleged that the defendants targeted a 65-year-old Queens man who used “Lavalife” on a number of occasions before July 2015, when he talked to a woman and gave her his home phone number. Shortly after the call ended, a man who identified himself as “Detective Flynch,” from the NYPD precinct in Coney Island, called the victim and told him he had been speaking to an underage girl. The supposed “detective” told the victim that he would be arrested unless he paid various ill-defined legal fees, including a settlement to the supposed girl’s mother and the cost of “therapy” for the girl. The victim also spoke to a woman who claimed to be the girl’s mother, and agreed to accept $10,000 in exchange for a release saying she would not press charges, the investigation found.

The victim was instructed to wire payments to the fictional girl’s mother, who identified herself as “Sandy DeWalt,” and on other occasions to send money to “Randy Jones.” The evidence shows that the “mother” was Nixon and the “detectives” were Jones and Nixon’s boyfriend, DeWalt.

It is further alleged that over the following months, the victim sent $10,000, in increments, to DeWalt and Jones via Western Union and MoneyGram. He would hear regularly from “Detective Flynch,” “Detective Fletcher,” or “Detective Fletcher’s partner,” as well as from the “girl’s mother,” who provided various explanations as to why she needed more money, such as her having to miss work due to her daughter’s “therapy.” When the victim balked, the “detectives” threatened in harsh terms to expose and arrest him.

At some point, the investigation found, the phony detective began telling the victim that he had to pay court fees and costs to avoid prosecution. The victim also started getting calls from a purported female prosecutor who identified herself as “ADA Sheryl McKenzie.” That was the same name Nixon used in a previous, similar scheme for which she was convicted in 2015, and received a prison sentence of two to four years. Nixon was incarcerated on that case during the present scheme but allegedly orchestrated it from behind bars, giving detailed instructions to her alleged cohorts on what to say on the calls and how to collect the funds.

The victim continued to receive threatening calls and make payments, sending a total of approximately $50,000, until October 2016, when the fake “detective” happened to say that he worked in the 109th Precinct, in the Bronx. The already-suspicious victim, who knew the 109th Precinct is actually in Queens, then changed his phone number and filed a police report.

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

Two New York City Police Detectives Indicted for Allegedly Raping Teenager in Coney Island After Placing Her Under Arrest

Victim was Sexually Assaulted While Being Transported in Police Van, Then Released

  Acting Brooklyn District Attorney Eric Gonzalez today announced that two New York City Police detectives have been charged in a 50-count indictment for allegedly raping a teenager in a police van in Coney Island last month after handcuffing her and placing her under arrest.

Acting District Attorney Gonzalez said, “It is incomprehensible that two veteran NYPD detectives would allegedly commit such an outrageous act. They took an oath to protect and serve, but allegedly violated that oath by raping a young woman who was in their custody. We will now seek to hold them accountable for this flagrant betrayal of public trust.”

Acting District Attorney Gonzalez identified the defendants as, Detective Eddie Martins, 37, and Detective Richard Hall, 32, who were assigned to the NYPD Brooklyn South Narcotics. The defendants were arraigned today before Brooklyn Supreme Court Justice Danny Chun on a 50-count indictment in which they are charged with first-degree rape, first-degree criminal sexual act, second-degree kidnapping, official misconduct and related counts. Martins was ordered held on $250,000 bail and Hall was ordered held on $150,000 bail. Both were ordered to return to court on January 18, 2018. If convicted, they each face up to 25 years in prison.

The Acting District Attorney said that, according to the investigation, on September 15, 2017, at approximately 7:30 p.m., the defendants, who were on-duty and riding in a Dodge Caravan, working as part of a team of plainclothes detectives assigned to Brooklyn South Narcotics and conducting a buy and bust operation in the confines of the 60th Precinct, left their post without authorization and drove to Calvert Vaux Park in Gravesend, Brooklyn.

Just after 8 p.m., the officers conducted a car stop of an Infinity Coupe driven by an 18-year-old woman with two male passengers. There was a quantity of marijuana in the front seat cup holder. The officers instructed the three occupants to step out of the car and asked if they had any drugs on them, according to the investigation. The young woman responded she had marijuana and two Klonopin pills. The detectives handcuffed the woman, told her she was under arrest and would be getting a desk appearance ticket. They let her companions go and instructed them to retrieve their friend from the precinct in three hours, the evidence showed.

It is alleged that after leaving the park, the officers instructed the young woman to call her friends and tell them not to follow the minivan. Detective Martins allegedly told the young woman he and his partner are “freaks” and asked her what she wanted to do to get out of the arrest. It is alleged that Detective Martins forced the handcuffed teen to perform a sex act on him while seated in the back seat of the van as Detective Hall drove and watched through the rear view mirror. Detective Martins then allegedly raped the victim.

Furthermore, it is alleged that the defendants then stopped the van in Bay Ridge, about four miles from the park in the opposite direction of where their team was located, and switched places. Detective Martins got behind the wheel and Detective Hall got into the back seat of the van, where he allegedly forced the victim to perform a sex act on him. They then drove back to the vicinity of the 60th Precinct in Coney Island and had the victim call her friends again to tell them she was being let go. They allegedly gave her back the Klonopin pills, told her to keep her mouth shut and released her.

The victim told her friends what happened and, later that evening, was taken to Maimonides Hospital, where a sexual assault evidence collection kit was prepared. DNA recovered from the victim was a match to both of the defendants. Video surveillance shows the victim exiting the police van at approximately 8:42 p.m.

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

IS THIS WHERE BRONX ASSEMBLYMAN MICHAEL BLAKE WILL BE ON ELECTION DAY?

On Tuesday, November 7th, voters in Virginia and New Jersey will go to the polls to cast their votes and Democrats have unique opportunities to win up and down the ticket in both states. The new DNC is focused on organizing 365 days a year and ensuring that our Every ZIP Code Counts program is helping partners all across the country.

Democrats have the opportunity to flip New Jersey’s governor seat from red to blue by electing Phil Murphy and hold Virginia’s governor seat by electing Ralph Northam. With only days left, the DNC is all-in in electing Democrats up and down the ballot.

VIRGINIA
The DNC made a $1.5 million investment, which allowed the Virginia coordinated campaign to immediately hire 40 additional field organizers and includes significant investments in digital, data, and tech infrastructure and the implementation of constituency-specific organizing in African-American, Latino and AAPI communities. The national Out of Commonwealth (OOCW) program is run by DNC staffer Ramsey Reid and as part of the OOCW, organizers have been hired with specific focuses on African-American, Latino, AAPI, millennial and faith outreach.  
In addition, the DNC has invested in mailers to the African-American, Latino and AAPI communities, blanketed the airwaves across the Commonwealth with top diverse surrogates and implemented a strategic and aggressive media plan to reach Latino voters. In the final few days leading up to election day, the majority of the DNC staff has or will be deployed into Virginia to help knock doors across the state. In addition, DNC Chair Tom Perez, Deputy Chair Keith Ellison, Vice-Chair Michael Blake, and Associate Chair Jaime Harrison will also campaign through Virginia.
In total, field staffers and volunteers knocked on 261,835 doors last weekend, a more than 192 percent increase from the same weekend in 2013 and a 66 percent increase from the same weekend in 2016. We have 31,000 door-knocking shifts scheduled for GOTV. In 2013, we had 13,000 door-knocking shifts scheduled for GOTV.

NEW JERSEY
Phil Murphy and Sheila Oliver are positioned to be the next governor and lieutenant governor of New Jersey and make life better for New Jerseyans across the state who suffered under the scandal-plagued Christie administration.
The DNC announced a six-figure investment in New Jersey’s critical November elections to support Murphy, Oliver and Democrats running up and down the ticket with GOTV organizing efforts, digital, data, and tech infrastructure and providing field support and volunteer recruitment through field and surrogate events.
The DNC has also provided the New Jersey Democratic Party with ‘Resistbot’ - a new tool that encourages voters to “make a plan to vote” and figure out where to vote on election day.
Lastly, the DNC has invested in key local elections, including seats that could be flipped from Republican to Democratic.

Stringer Audit: Board of Elections’ Failures Jeopardize New Yorkers’ Right to Vote

90% of sampled poll sites had serious issues — from improperly handled ballots to poorly trained poll workers

  As the City prepares for a citywide election in the coming days, New York City Comptroller Scott M. Stringer released an alarming new audit showing significant breakdowns in the operations of elections by the City’s Board of Elections — or BOE — that jeopardize New Yorkers’ right to vote. After the BOE’s voter “purge” came to light in April 2016, the Comptroller’s Office deployed staff to more than 150 poll sites to observe three subsequent elections. Auditors discovered violations of federal, state, and BOE rules — including mishandled affidavit ballots — at more than half of poll sites in our sample, inadequate staffing at three-fourths of voting locations, and fundamental failures in serving voters with disabilities at more than a quarter of BOE polling places.

“Most know about the Brooklyn purge, in which more than 117,000 residents were taken off the voter rolls. What these new findings show, however, is that there is effectively another purge that takes place beneath the surface. We’ve uncovered deeply concerning, systemic issues in the BOE’s operations. The BOE cannot be synonymous with dysfunction, and we cannot allow these egregious failures to undermine New Yorkers’ fundamental rights,” New York City Comptroller Scott M. Stringer said. “Our poll workers work exceptionally hard, but the BOE isn’t giving them the support they deserve. After a thorough review of the agency, it’s clear the voter purge is a reflection of larger, systemic, day-to-day breakdowns. Elections matter, and every vote must be counted in every election. That’s why the BOE needs to fundamentally change its operations.”

Auditors scrutinized the BOE’s operations at 156 poll sites over three elections (held on June 28, 2016, September 13, 2016, and November 8, 2016), cross-checked their findings with Federal, State, and local laws, and examined voter rolls. The report uncovers how:

Federal and State Election Laws Were Broken, and the BOE’s Own Internal Rules Were Ignored

In the course of the audit, Comptroller’s Office staff examined 156 polling sites and found that at 82 of them — or 53 percent —Federal and State election law or BOE rules were broken. That increases the risk that New Yorkers’ votes could go uncounted.

• At 14 percent of sites, affidavit ballots — which are used by voters whose names are not on the rolls but may still be eligible to vote — were mishandled. At one location, poll workers were unaware that a voter should have been offered an affidavit ballot, despite Federal and State law requiring that offer be made. As a result, that voter — who may have been eligible to vote despite not being listed on the rolls — was potentially disenfranchised.
• In 10 percent of sampled polling locations, we observed voters who went largely unassisted when issues arose. In one egregious example, auditors witnessed a distracted poll worker disenfranchise a voter in real-time. The poll worker failed to see that a voter’s ballot had been rejected by a scanning machine, and — by the time the poll worker realized what happened — the voter had already left the polling place. The ballot was then marked as void and not counted.
• At numerous poll sites, auditors observed unlawful electioneering, including:
• Poll workers — within earshot of voters — discussing candidates on the ballot;
• An interpreter assigned to a poll site to help voters with limited English Proficiency telling voters which candidate to vote for instead of how to vote;
• And a poll worker telling a voter who needed help with an affidavit ballot which candidate to support.
• At almost a dozen sites, poll workers weren’t familiar with the procedure to close a poll site at the end of Election Day. This included a lack of knowledge about processing required vote-count documents, calling into question the BOE’s ability to ensure every vote is counted.
• At 27 percent of the sites sampled by the Comptroller’s Office, voters were given ballots before they signed registration rolls. This increases the risk that a mistake could occur, leading to improperly cast, or improperly counted, votes.

The BOE Failed to Properly Staff More Than Three Quarters of Sampled Polling Sites — Leading to Confusion and Delays at the Polls

During the course of the investigation, the Comptroller’s Office identified staffing problems at 118 of the 156 poll sites — or 76 percent of those visited. Issues included:

• One poll site coordinator told auditors that she called poll workers several days before the election to confirm their attendance. After realizing that many poll workers were not planning on showing up, she informed the BOE — which ignored her request for replacement staff. On Election Day, a full 41% of the staff assigned to that poll site — St. Marks School in Sheepshead Bay, Brooklyn — did not arrive. No additional staff were sent, and their positions were left unfilled.
• At 14 sites that auditors visited, poll workers indicated that there were either too few interpreters for the primary languages spoken in those specific neighborhoods or that no interpreters were assigned to the poll site at all. At one site at which the main languages spoken by the local population included Spanish and Russian, the BOE assigned three Chinese-language interpreters. According to the BOE coordinator assigned to the site, those interpreters’ services were not used by voters during the auditor’s observation.
• The BOE reported a 13% absentee rate during the three elections that the Comptroller’s Office staff observed, along with a 17% “vacancy rate” — which means no one was even assigned to 17% of required jobs.

The BOE Often Failed to Provide Assistance for Voters with Disabilities

Under Title II of the Americans with Disabilities Act, the BOE is required to ensure that New Yorkers with disabilities are provided a full and equal opportunity to vote. Auditors, however, found that at 45 of the 156 sampled poll sites — nearly 30 percent — the BOE did not provide adequate assistance for people with disabilities. Specific findings include:

• 15 sites — 10 percent of the total sample — were not accessible for all or part of the day. In these cases, wheelchair ramps weren’t installed until hours after poll sites opened, elevators were broken, and signs denoting accessible entrances were not publicized.
• At 19 of the polling sites (12 percent of the sample), “accessibility clerks” — who are specifically assigned to help voters with disabilities — either didn’t show up on Election Day, or were re-assigned to other tasks.
• At 16 locations — 10 percent of the sample — “Ballot Marking Machines,” which help voters with disabilities fill out their ballots independently, were not fully functioning.

Poll Worker Training Proved Exceptionally Inadequate

Auditors attended five training sessions for poll workers and found that the lessons failed to cover the full scope of work required to effectively coordinate Election Day operations. Specifically:

• In all of the training sessions auditors attended, instructors stated that they were skipping certain information because of time constraints.
• Little — if any — hands-on training was provided to poll workers. Across the five trainings that auditors attended, for example, only two attendees were allowed to touch the “ballot marking devices” that are used to assist voters with disabilities.
• The poll worker exam, on which prospective poll workers must score at least 85 percent to pass, was of questionable value because it was both open book and included page numbers where answers could be found next to each question. One participant went so far as to tell auditors the test was an “idiot test… where you are told where to find the answers.”

 The BOE Illegally Purged 117,305 Voters from the Rolls in Brooklyn

Between March 2014 and July 2015, the BOE’s Brooklyn Office improperly cancelled the registration of 117,305 voters based only on the fact they had not voted since 2008. That move violated both Federal and State law and denied voters their right to participate in the April 2016 Presidential Primary through the normal voting process.

The Comptroller’s Office made a number of recommendations, including that the BOE:

• Improve training for poll workers — and consider extending training hours so all of the material that poll workers need to know can be covered;
• Ensure every poll site is fully accessible and fully staffed, including with the appropriate interpreters;
• Attract more poll worker candidates by working to increase poll worker pay;
• Evaluate a pilot program that attempted to increase the number of poll workers by allowing them to work half-day shifts, and consider implementing this program if applicable; and
• Establish a working group to identify and implement reforms.

Two Defendants Convicted At Trial In Connection With Fatal 2012 Home Invasion Robbery

  Joon H. Kim, the Acting United States Attorney for the Southern District of New York, announced that GIBRON LOPEZ and JUDIE OLIVERA were convicted in Manhattan federal court yesterday of Hobbs Act robbery and Hobbs Act robbery conspiracy charges stemming from their commission of a May 2012 home invasion robbery of victim Miles Klein, which resulted in Klein’s death.  LOPEZ and OLIVERA were convicted after a one-and-a-half week trial before U.S. District Judge Katherine Polk Failla.

According to the Indictment, other filings in Manhattan federal court, and the evidence admitted at trial: 

In May 2012, OLIVERA, who had a preexisting relationship with Klein, set up a home invasion robbery, which targeted Klein’s drugs and drug proceeds.  OLIVERA recruited LOPEZ and another man to commit the robbery.  On May 15, 2012, OLIVERA gained access to Klein’s apartment in the Bronx, and LOPEZ and the other man, armed with a wrench and a rubber mallet, respectively, followed her there.  LOPEZ and the other man struggled with Klein at the door, striking him in the head repeatedly with the wrench and the mallet, binding his eyes and mouth with duct tape, and gagging him.  During the assault, OLIVERA stole a safe containing cash, among other items, from Klein’s apartment.  LOPEZ and the other man then dragged Klein’s body to the bathroom, where they left him.  They discarded the murder weapons and their bloody clothes in a sewer, and later split the proceeds of the robbery.  Police responded to the scene on May 16, 2012, after receiving a 911 call from concerned family members.  Klein was ultimately pronounced dead as a result of blunt force trauma to his head and obstruction of his airway.

LOPEZ, 37 and OLIVERA, 39, both of the Bronx, were each convicted of one count of Hobbs Act robbery, which carries a maximum sentence of 20 years in prison, and one count of Hobbs Act robbery conspiracy, which carries a maximum sentence of 20 years in prison.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge. 

Doctor And Nurse Practitioner Among Three Defendants Charged In Manhattan Federal Court For Oxycodone And Fentanyl Diversion Scheme

   Joon H. Kim, the Acting United States Attorney for the Southern District of New York, James J. Hunt, the Special Agent in Charge of the New York Field Division of the Drug Enforcement Administration (“DEA”), James P. O’Neill, the Commissioner of the Police Department for the City of New York (“NYPD”), and Mark G. Peters, the Commissioner of the New York City Department of Investigation (“DOI”), today announced the arrests of ERNESTO LOPEZ, a New York-licensed doctor who wrote thousands of medically unnecessary prescriptions for oxycodone and fentanyl patches over an approximately three-year period, SHARON WASHINGTON-BHAMRE, a pediatric nurse practitioner who also wrote medically unnecessary prescriptions for oxycodone, and AUDRA BAKER, an employee at one of LOPEZ’s medical offices who helped facilitate the diversion scheme.  All three defendants are charged with conspiracy to distribute controlled substances and were arrested earlier this morning.  The defendants will be presented in Manhattan federal court before U.S. Magistrate Judge Barbara C. Moses later today.

Acting U.S. Attorney Joon H. Kim stated: “As alleged, these defendants acted like drug dealers in lab coats, directly contributing to the glut of highly-addictive opioids flooding the streets of New York City and its surrounding communities.  Our office will continue to investigate and prosecute all those who abuse their medical licenses to enrich themselves.”

DEA Special Agent in Charge James J. Hunt stated:  “At the same time that cartels are pushing fentanyl on opioid users, this investigation identified a rogue doctor following suit.  With offices strategically located in Nassau County, Manhattan, and Queens, Dr. Lopez allegedly wrote unnecessary prescriptions for oxycodone and fentanyl worth millions of dollars on the street.  I commend our law enforcement partners for their collaboration and hard work on this investigation.”

DOI Commissioner Mark G. Peters said:  “This doctor and his co-defendants in the medical profession disregarded their duty to aid the sick and infirmed, deciding instead to heed personal profit in return for pushing dangerous opioids, according to the charges. DOI is proud to work with our federal and local law enforcement partners on this significant investigation to expose and stop a pill mill advancing the perilous opioid crisis.”

The following allegations are based on the Complaints[1] and other documents filed in Manhattan federal court:

Oxycodone and fentanyl are highly addictive, narcotic opioids that are used to treat severe and chronic pain conditions.  Oxycodone prescriptions are in high demand and have significant cash value to drug dealers, who sell them on the street for large amounts of money.  For example, 30-milligram oxycodone tablets have a current street value of approximately $20 to $30 per tablet in New York City, with street prices even higher in other parts of the country.  Thus, a single prescription for 120 30-milligram tablets of oxycodone can net an illicit distributor $2,400 in cash or more.  Fentanyl patches are also commonly abused and sold for cash on the street by drug dealers.  Because it is much more potent than heroin, fentanyl frequently results in overdoses that can lead to respiratory depression and death.  

From 2015 until October 2017, LOPEZ operated medical clinics located in Manhattan, New York; Jackson Heights, New York; and Franklin Square, New York, where LOPEZ wrote thousands of prescriptions for large quantities of oxycodone and fentanyl patches in exchange for cash payments.  BAKER assisted LOPEZ in operating two of his medical offices.  LOPEZ typically charged $200 to $300 in cash for “patient visits,” where LOPEZ performed no meaningful physical examination of patients.  Instead, a typical “patient visit” consisted primarily of recording a patient’s vital signs and sometimes involved the brief movement of a patient’s limbs.  LOPEZ then prescribed large quantities of oxycodone, most frequently 120 30-milligram tablets, and fentanyl patches.  Between January 2015 and the present, LOPEZ wrote more than 8,000 oxycodone prescriptions, resulting in an estimated $2 million in fees to LOPEZ.  BAKER assisted LOPEZ in the diversion of oxycodone and fentanyl.  For example, BAKER steered at least one patient to a particular individual (“CC-1”), so that CC-1 could purchase that individual’s oxycodone prescriptions and resell the drugs on the street.

From December 2015 until October 2017, WASHINGTON-BHAMRE, a pediatric nurse practitioner, wrote scores of medically unnecessary oxycodone prescriptions.  During this time, WASHINGTON-BHAMRE wrote oxycodone prescriptions in the names of individuals provided to her by CC-1 without performing any examination of the purported patients. 

LOPEZ, 74, of Flushing, New York, BAKER, 49, of Manhattan, New York, and  WASHINGTON-BHAMRE, 52, of Rochelle Park, New Jersey, are each charged with one count of conspiring to distribute and possess with intent to distribute a controlled substance, 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 defendants will be determined by the judge.

Mr. Kim praised the outstanding investigative work of the DEA’s New York Tactical Diversion Squad, which comprises agents and officers from the U.S. Drug Enforcement Administration, the New York City Police Department, the New York State Police, New York State Division of Financial Services and New York City Department of Investigation.  Mr. Kim also thanked the Department of Health and Human Services, the New York State Office of the Medicaid Inspector General, the New York City Human Resources Administration, the Nassau County Police Department and Asset Forfeiture Unit, the Nassau County District Attorney’s Office, the New York County District Attorney’s Office, and the New York State Department of Financial Services for their work on the investigation.

Parts of this case were conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership between federal, state, and local law enforcement agencies.  The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations and those primarily responsible for the nation’s illegal drug supply.

The charges contained in the Complaints 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 Complaints, and the description of the Complaints set forth herein, constitute only allegations, and every fact described should be treated as an allegation.

Former Chief Financial Officer Of Osiris Therapeutics, Inc., Pleads Guilty To Lying To Auditors

   Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and Philip R. Bartlett, Inspector-in-Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), announced that PHILIP JACOBY, the former chief financial officer of Osiris Therapeutics, Inc. (“Osiris”), a developer and producer of regenerative medicine products, was charged by criminal information (the “Information”) and pled guilty today to lying to Osiris’s auditors in connection with the auditors’ review of Osiris’s 2014 10-K and Third Quarter 2015 10-Q filings.  JACOBY pled guilty before U.S. District Judge Denise Cote.

Acting Manhattan U.S. Attorney Joon H. Kim said:  “Philip Jacoby, the former CFO of a pharmaceutical company, admitted today to lying to auditors conducting an examination of the financial well-being of his company.  Jacoby fabricated documents, made false statements, and asked others to backdate critical transactions in furtherance of his scheme to mislead auditors. For his criminal conduct, which ultimately misled those looking to invest in his publicly traded company, Jacoby faces time in federal prison.”

Inspector-in-Charge Philip R. Bartlett said:  “In a misguided effort to avoid a restatement of Osiris’s fourth quarter revenue numbers, Philip Jacoby lied about the conversion of $1.1 million dollars of consignment inventory to a final sale.  He wasn’t so clever when he left a paper trail of evidence Postal Inspectors followed right back to him.”

According to allegations contained in the Information and statements made in public Court proceedings:

Osiris, headquartered in Columbia, Maryland, is a publicly traded company specializing in the research, development, and marketing of regenerative medicine products.  Osiris sold its products either through its direct sales force, or, more typically, through numerous distributors.  Osiris’s securities traded under the symbol “OSIR” on the NASDAQ stock exchange. 

From in or about 2008 up to and including in or about September 2015, JACOBY held the position of chief financial officer (“CFO”) of Osiris.  From in or about September 2015 through in or about January 2016, JACOBY held the position of principal accounting officer.  During the period that JACOBY was the CFO of Osiris, he signed Osiris’s quarterly and yearly financial reports.  These reports were required to be filed with the United States Securities and Exchange Commission (“SEC”) and provided the investing public with information regarding Osiris’s financial performance.

Although Osiris was initially a research and development company, by at least in or about 2014, Osiris’s management was focused on the company’s “top line,” or gross revenue growth.  Osiris was especially focused on being able to demonstrate quarter-over-quarter revenue growth, that is, reporting revenue for each quarter that was greater than the previous quarter’s.  For example, a former CEO of Osiris (the “CEO”) regularly prepared internal presentations emphasizing the company’s historical quarter-over-quarter revenue growth and emphasizing the need to achieve future growth.  Similarly, in public earnings calls run by the CEO and in its earnings press releases, Osiris touted its revenue performance and quarter-over-quarter revenue growth. 

Improper Accounting at Osiris With Respect to Distributor-1

Between approximately 2010 and approximately 2015, Distributor-1 was a distributor for Osiris’s Ovation product, among other products.  Distributor-1 was owned in its entirety by a sole principal (“Owner-1”).

In or about September 2013, the Food and Drug Administration (“FDA”) informed Osiris that Ovation failed to meet certain regulatory requirements and thus required pre-marketing approval from the FDA, which Ovation did not have.  Thereafter, Osiris agreed with the FDA that it would not sell Ovation after December 31, 2014. 

In order to maintain access to Ovation following December 31, 2014, Distributor-1 agreed to take possession of a significant quantity of Ovation prior to December 31, 2014, and by December 2014 was in possession of approximately $1.8 million worth of Ovation.  Because Distributor-1 lacked the ability to pay for such a large purchase, the Ovation was shipped to Distributor-1 on consignment.  Because the product was on consignment, under governing accounting rules Osiris could not properly recognize revenue until Distributor-1 had sold the product to an end user or Distributor-1 otherwise agreed to purchase the product.

In or about December 2014, JACOBY requested that Owner-1 convert some or all of the consigned inventory to inventory owned by Distributor-1 by December 31, 2014.  To the extent other revenue recognition criteria were satisfied, completion of the actual sale of the inventory to Distributor-1 by December 31, 2014, would have allowed Osiris to recognize revenue for that product in 2014 and reference that revenue in the 2014 10-K it would subsequently file.

Notwithstanding internal pressure to make sales, however, JACOBY and Owner-1 did not reach a final agreement regarding the conversion of the consigned inventory until at least in or about January 2015.  Despite the fact that no agreement was reached in 2014, Osiris, at the direction of JACOBY, booked approximately $1.1 million in revenue related to the conversion of consignment product in the fourth quarter of 2014 (the “Distributor-1 Transaction”).

Jacoby Conveys False Information to Auditors After Improper Accounting Is Questioned

In or about October 2015, the Company’s auditors (the “Auditors”), in connection with an inspection by the Public Company Accounting Oversight Board (the “PCAOB”), requested additional documentation and information supporting Osiris’s recognition of revenue in December 2014 relating to the Distributor-1 Transaction.  In an effort to deceive the Auditors and the PCAOB, JACOBY provided or caused to be provided false, inaccurate, and misleading information to the Auditors. 

For example, in or about October 2015, JACOBY and others prepared a memorandum from Osiris to its Auditors attempting to justify the recognition of $1.1 million of revenue from the Distributor-1 Transaction in the fourth quarter of 2014.  In the memorandum, JACOBY falsely represented that on December 31, 2014, JACOBY had “discussed the sale terms with [Owner-1] via a conference call, and [Owner-1] agreed to purchase 933 units of Ovation for $1,072,950.”  As JACOBY well knew, no telephone call had taken place on December 31, 2014. 

Similarly, on or about November 5, 2015, JACOBY created a letter, backdated to December 29, 2014, purporting to memorialize an agreement between Osiris and Distributor-1 (the “Backdated Letter”).  That same day, JACOBY used his personal email account to send the Backdated Letter by email to Owner-1 stating:

“attached is something that I think you should find and send to me in an email saying you had this in your file from late last year, and just came across it – and that it does memorialize our several phone conversations . . . . . Call me if necessary, but write a wonderfully warm and convincing email, please – send it to my Osiris email.”

Owner-1 complied and sent the Backdated Letter to Jacoby’s Osiris email account.  JACOBY then forwarded Owner-1’s email containing the fraudulent Backdated Letter to the CEO and the then-CFO of Osiris, who forwarded the document to the Auditors. 

           

PHILIP JACOBY, 65, pled guilty to one count of making fraudulent statements to Osiris’s auditors, which carries a maximum sentence of 20 years in prison.  The defendant also faces a maximum fine of $5 million.  Sentencing before Judge Cote has been scheduled for February 2, 2018, at 11:00 a.m.    

The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.    

           

Mr. Kim praised the investigative work of the United States Postal Inspection Service and also thanked the SEC, which filed a parallel civil case today.

A.G. Schneiderman Announces $132K Settlement With Bushwick Landlords For Harassing Tenants With Illegal Buyout Offers

Brooklyn Landlords Harassed Rent-Stabilized Tenants By Failing To Comply With NYC’s Buyout Law; Will Pay $132,000 to Fund Affordable Housing

Settlement Is First-Of-Its-Kind Under The Buyout Law

A.G. Schneiderman Continues To Fight For Stronger State Laws To Criminally Crack Down On Tenant Harassment

  Attorney General Eric T. Schneiderman  announced a settlement reached with real estate developers and landlords Graham Jones, Greg Jones, and their related companies for violating anti-harassment law at their three rent-stabilized buildings in Bushwick, Brooklyn. After purchasing the buildings in 2016, the landlords immediately began approaching rent-stabilized tenants to try to convince them to move out of their apartments in exchange for money. These efforts are more commonly known as “buyout offers.” Between June 2016 and July 2017, a total of 33 tenants (more than one-third of the tenants living in the buildings) accepted buyout offers; however the landlords failed to provide these tenants with the required written notice explaining their rights under local law.

“Tenants should never feel harassed into vacating their homes,” said Attorney General Schneiderman. “This settlement makes clear that we will aggressively enforce the law to protect tenants from those who seek to put profit before New Yorkers’ rights — and we’ll continue to fight for the tougher state laws we need to criminally crack down on tenant harassment.”

In 2015, NYC Intro. 700 became law, amending the Housing Maintenance Code’s definition of “harassment” to make it illegal for a landlord to make a buyout offer to a tenant without providing a written notice. The written notice must explain the following: (1) the purpose of the landlord’s contact with the tenant; (2) that the tenant can reject the buyout offer and continue to occupy their unit; (3) that the tenant can seek the guidance of an attorney regarding the buyout offer and can refer to the HPD guide entitled, “The ABCs of Housing”; (4) that the contact is made by or on behalf of the owner; and (5) that the tenant can, in writing, refuse the contact and such refusal would bar contact for 180 days. The law was passed to address intimidation tactics employed by some landlords to pressure tenants to vacate rent-stabilized apartments.

The buildings in this settlement are located in Bushwick, Brooklyn at 920 Bushwick Avenue, 946 Bushwick Avenue, and 1075 Greene Avenue and have 105 apartment units among them. When Graham Jones and Greg Jones bought the buildings in 2016, all apartments were protected by rent stabilization. The landlords immediately began to offer buyouts to tenants without the required written notice, resulting in 33 vacancies within one year. In this rapidly changing neighborhood, newly renovated apartments can demand high rents – unaffordable to the majority of long-term Bushwick tenants.

The Attorney General learned of these practices after remaining tenants complained of the landlords’ aggressive tactics.

Under the settlement obtained by Attorney General Schneiderman, the landlords will pay $132,000 in restitution to the New York City Department of Finance, which will be used by the Department of Housing Preservation and Development to finance housing projects for low-income New Yorkers. The landlords also agreed not to engage in any form of tenant harassment in violation of Section 27-2005(d) of the New York City Municipal Code, including engaging in buyout offers without providing the required written notice. 

Click here to read the settlement.

In May 2017, the Attorney General introduced the Tenant Protection Act of 2017to criminally crack down on tenant harassment.  Attorney General Schneiderman’s efforts against tenant harassment have also included forming a Tenant Harassment Prevention Task Force with city and state officials; launching a team to enhance and streamline the office’s resources to combat tenant harassment, deceptive lending practices, and other housing issues facing constituents; and charging landlords and management companies for alleged illegal practices to harass and endanger rent-regulated tenants.

Senator Jeff Klein announces $1 million in funding for Albert Einstein College of Medicine

Grant will be used for upgrades to The Rose F. Kennedy Center to support new Brain Sciences Initiative

Senator Jeff Klein announced $1 million in state funding for the Albert Einstein College of Medicine that will be used for upgrades to The Rose F. Kennedy Center to support the college’s new Brain Sciences Initiative. The announcement was made on Thursday, November 2 during a luncheon celebrating the 50 year anniversary of The Rose F. Kennedy Center.

“The Albert Einstein College of Medicine is a top-notch institution for medical education and research. I’m extremely proud to secure $1 million in funding for Einstein, which will be used to modernize the 50-year-old Rose F. Kennedy Building to support the college’s new Brain Sciences Initiative. I look forward to these upcoming improvements that will enable a team of medical experts to research and address critical brain disorders such as Alzheimer’s disease,” said Senator Jeff Klein.

“Senator Klein has been a long-time and steadfast supporter of medical research and this new gift is further evidence of his commitment to improve the health of people in the Bronx and around the state,” said Dr. Allen M. Spiegel, the Marilyn and Stanley M. Katz Dean at Albert Einstein College of Medicine and Executive Vice President and Chief Academic Officer at Montefiore. “We are working to achieve major breakthroughs in the brain sciences and this gift helps strengthen Einstein’s ability to advance the field.”

Senator Klein’s $1 million funding allocation will be used to modernize a portion of the The Rose F. Kennedy Center, including improvements to the 9th floor and the expansion of existing labs.

(From left to right: Dr. Tim Shriver, chair of the Special Olympics; Dr. Allen M. Spiegel, dean at Albert Einstein College of Medicine; Dr. Kamran Khodakhah, chair of neuroscience at Albert Einstein College of Medicine; Senator Jeff Klein; Assemblyman Mark Gjonaj; Salvatore Ciampo, senior director of facilities management at Albert Einstein College of Medicine.)