NEWS FROM ASSEMBLYMAN JEFFREY DINOWITZ

ASSEMBLYMAN JEFFREY DINOWITZ STATEMENT ON RENT GUIDELINES BOARD RENT INCREASE DECISION

On June 26, 2018, the Rent Guidelines Board voted to increase rents of stabilized units by 1.5 and 2.5% for one and two year leases, respectively.

  Following the adoption of Rent Guidelines Board Apartment Order #50 on Tuesday, June 26 which increased rents for the second consecutive year, Assemblyman Jeffrey Dinowitz issued the following statement:

“As New York City continues to suffer through an affordability crisis, where homelessness rates are rising amidst tenants being pushed out by ever-increasing rents, it has become even more necessary to ensure that all New Yorkers are able to continue to afford living in their homes. Property owners are making more money than ever before as real estate values continue to skyrocket and more rent-stabilized units are forced out of rent regulation.

There are already numerous giveaways to landlords in the form of unchecked Individual Apartment Improvement increases, permanent rent increases from Major Capital Improvements despite a mere eight or nine year amortization period, a broken preferential rent system where landlords can raise rents by substantial amounts, and many more. Landlords receive millions of dollars in tax credits each year, yet they cry poverty each year when the Rent Guidelines Board is deciding how much to increase rents on working-class New Yorkers.

If landlords really want to understand poverty, some of them need to look no further than their own tenants. Even small rent increases can make the different between whether a tenant is able to afford to stay in their apartment or if they are forced from their homes. What these tenants needed was a rent freeze, if not an outright rent reduction, but what they got instead was a bigger bill from their landlord. I am glad that the Rent Guidelines Board did not approve the landlord-promoted rent increase of 7.5%, but I am also deeply disappointed that many of our community members are less able to afford housing.”

STATE LEGISLATURE PASSES CRITICAL LEGISLATION STRENGTHENING ‘TRANSIT LOCKBOX’

Recently revived legislation from Assemblyman Jeffrey Dinowitz and State Senator Martin J. Golden has now passed both chambers of the state legislature; advocates urge Governor to sign bill into law to promote fiscal transparency amid new MTA funding requests

   Assemblyman Jeffrey Dinowitz and State Senator Martin J. Golden have successfully shepherded legislation through a divided state legislature to require funding dedicated to public transportation systems (including the MTA) be used for their intended purpose. The bill also requires any legislation that diverts public transportation funding to include a diversion impact statement which reflects the amount of the diversion from each fund listed separately, the amount diverted expressed as current monthly transit fares, the cumulative amount of diversion from the previous five years, and a detailed estimate of the impact on service, maintenance, security, and current capital program.

For many years, the MTA has seen their operational costs increasingly used to pay debt service. The MTA’s debt service payments have grown from essentially nothing in the early 1980’s to over $2.5 billion in 2018. Despite this increasing cost burden siphoning much-needed resources away from a subway system in crisis, the MTA and other transportation systems have remained a frequent target of Governors who wish to use dedicated taxes to support transit projects to cover budgetary shortfalls in unrelated areas. The diverted funds are then replaced with bonds or loans that are backed by these same taxes, further adding to the existing debt burden.

Assemblyman Dinowitz has championed this bipartisan and common-sense legislation with State Senator Martin Golden (R-Brooklyn), resurrecting the bill as the MTA is once again in a state of crisis. A similar bill was vetoed by Governor Cuomo in 2013. Transit and good government advocates have hailed the legislation as a much-needed salve of transparency which will both hold the Governor and Legislature accountable when it comes to adequately funding public transportation systems in New York State. The bill (A8511/S6807) will next be delivered to the Governor, where it faces an uncertain future despite an estimated $38 billion in needed capital funding to meet the aspirational goals of the MTA’s ‘Fast Forward’ Plan to bring its transit system into the 21^st Century.

Assemblyman Jeffrey Dinowitz said: “As we examine every way to raise dedicated and sustainable revenue for mass transit in New York, it has become increasingly clear that we need to ensure that our promises to straphangers remain kept. If the people of New York are expected to continue paying increased fares and new taxes or fees to fix our subways and buses, then they should be confident that this money is being spent in the right place. I am proud of my colleagues for supporting this bill, and urge Governor Cuomo to sign this bill into law.”

State Senator Martin J. Golden said: “As the Senate Representative on the Metropolitan Transportation Authority Capital Review Board, I know how important it is that resources dedicated to the MTA, stay with the MTA. The Executive should not be able to “sweep” monies dedicated for transportation and use them in other ways. This bill stops this shortsighted practice, and ensures that we have the funding needed to bring the MTA transportation system up to speed. This bill will help ensure that our transit system is efficient, reliable and a safe for commuters.”

STATEMENT FROM MAYOR BILL DE BLASIO ON THE PRIMARY ELECTION OF ALEXANDRIA OCASIO-CORTEZ

  “Congratulations to Alexandria Ocasio-Cortez, who transcended the conventional norms of politics and connected with the people in a powerful way. She put forward a resonant, progressive agenda and energetically organized at the grassroots — two approaches that need to define the future of the Democratic Party. The party is in a deep and fast process of change, and its future is decidedly progressive. Ms. Ocasio-Cortez is an important part of the future, and I look forward to working with her.

“Joe Crowley served his district with heart and dedication. It was an honor to work with him as he fought for his constituents and for all of New York City, and on behalf of all New Yorkers, I thank him for his service.”

News From Congressman Eliot Engel

Energy & Commerce Health Subcommittee Passes Engel Palliative Care and Hospice Education and Training Act

  The House Energy and Commerce Committee’s Health Subcommittee unanimously approved H.R. 1676, the Palliative Care and Hospice Education and Training Act (PCHETA), legislation authored by Congressman Eliot L. Engel.

Palliative care focuses on alleviating suffering for patients and their loved ones, accompanying efforts to treat or cure illness. It involves communication with patients and their families to coordinate care, determine patient preferences, and assist with medical decision-making. This extra layer of support is appropriate for patients with serious illnesses starting at the point of diagnosis, through treatment, and onward through hospice and the end of life.

Palliative care can help patients and families cope with the symptoms, stress and pain of illness, but many aren’t aware of these benefits. In addition, there is a shortage of educated providers who can offer quality palliative care. The Palliative Care and Hospice Education and Training Act addresses these issues by expanding opportunities for training in palliative and hospice care. The bill also seeks to better educate patients, families and health professionals about palliative care’s benefits and encourages the National Institutes of Health to expand research around this topic.

H.R. 1676 was co-authored by Congressman Tom Reed and Congressman Earl L. “Buddy” Carter. It is supported by the American Cancer Society Cancer Action Network, the Alzheimer’s Association, the American Academy of Hospice and Palliative Medicine, and other organizations representing patients, providers, and health systems. The bill has also been cosponsored by 281 bipartisan Members of Congress.

“Most of us, sadly, have known a loved one who has faced a serious or life-threatening illness, and we know too well the confusion and stress those situations bring,” Engel said. “This bill will help us ensure there is a well-trained palliative and hospice care workforce available to care for patients and bring needed relief to families.”

“I care about ensuring there is a trained workforce capable of meeting the demands for new models of healthcare delivery, and I am happy to see this legislation gain traction,” Reed said. “Hospice and palliative care provide significant health cost savings while improving the quality of life for the seriously ill.”

“As a pharmacist for more than 30 years, I served as a pharmacy consultant for hospice care,” said Carter. “I saw firsthand the important impact that proper palliative care can have on patients and families going through incredibly difficult end of life decisions. This legislation ensures that there is a well-trained palliative care workforce available and ready for those individuals with serious illnesses and I am very glad this legislation was approved by our subcommittee today.”

“For millions of cancer patients and their families, palliative care can play an essential role in improving their quality of life throughout treatment and survivorship,” said American Cancer Society Cancer Action Network (ACS CAN) president Chris Hansen. “Today’s markup of the Palliative Care and Hospice Education and Training Act is an important step forward in advancing access to palliative care services and we commend Representatives Engel, Reed and Carter for their steadfast commitment to this cause.  Expanding access to supportive care that treats the whole patient, not just their disease, is crucial for cancer patients, survivors and their families.”

Engel Lambastes Supreme Court Decision Undermining the Right of Workers to Organize

  “The Supreme Court’s outrageous 5-4 decision in Janus v. AFSCME is yet another harsh partisan blow to the working families of New York and this nation. The Court’s ruling bars public sector unions from charging fees to all public employees who benefit from their efforts to negotiate for better pay, better benefits, and better working conditions. 

“As a former member of the teachers union, I find today’s ruling particularly distasteful.  The Supreme Court’s conservative majority overturned four decades of legal precedent to undermine the ability of public service workers to negotiate for decent pay and fair workplaces.  This ruling is an outright attack on the public employees who educate our kids, keep our streets safe, fight fires, and rush to our aid when we have an accident.

“Now, thanks to this latest blow from SCOTUS, those of us who proudly stand shoulder-to-shoulder with labor must redouble our efforts. I will continue fighting for the rights of all workers to bargain collectively for better pay and benefits and safe work environments.  Unions remain the most effective vehicle for working people to secure their rights and freedoms, and they provide a pathway to the middle-class. We need to make sure that pathway remains opens. ”

Engel Statement on the Retirement of Justice Anthony Kennedy

   “Justice Anthony Kennedy has served on the United States Supreme Court for thirty years and though I have often disagreed with him, he has sometimes been an important check on many of the far-right voices on the court. He provided critical opinions in cases that helped move our country forward, including Obergefell v. Hodges that established marriage equality and Whole Woman’s Health v. Hellerstedt that reaffirmed a women’s right to choose.

“The consequences of Justice Kennedy’s retirement cannot be overstated. The next Supreme Court Justice will be responsible for upholding fundamental rights for women, LGBTQ individuals, workers, and people of color. Given President Trump’s vigorous and consistent assault on the courts and the rule of Law, it is imperative that the next Justice be a defender of our Constitution and American values, not a hyper-partisan ideologue.

“I believe that the Senate should follow the precedent set by the Senate Majority Leader in 2016 and only consider a new Supreme Court nominee after the new Congress is seated.”

$400 MILLION RAISED: MAYOR DE BLASIO, OFFICE OF STRATEGIC PARTNERSHIPS RELEASE REPORT DETAILING CITYWIDE EFFECT OF PUBLIC-PRIVATE PARTNERSHIPS

  Mayor Bill de Blasio and Gabrielle Fialkoff, Senior Advisor to the Mayor and Director of the Office of Strategic Partnerships, today released New York City Partnerships: Strategic Partnerships for a More Inclusive and Equitable City, a report summarizing the progress and effect of public-private partnerships and the $400 million raised by city affiliated non-profits during the first four years of the Administration.

New Yorkers across the city have been impacted by these partnerships. Through the work of the Office and their partners over 40,000 community school students have received free prescription glasses from Warby Parker, 25,000 pounds of produce from Farms at NYCHA have been distributed, and homicides are down 18% in Cure Violence neighborhoods.  

“We believe that in order to make New York City the fairest big city in America, our private, nonprofit and business sectors must work together,” said Mayor de Blasio. “Through the Office of Strategic Partnerships, we’ve connected our philanthropic and business partners across the City to bring services and opportunities to more New Yorkers than ever before.”

“Cities can and must lead as social and civic innovators, particularly in the face of political and fiscal challenges. Growing inequality -- in income, access to affordable housing or high quality schools or healthcare -- threatens opportunity for all,” said Gabrielle Fialkoff, Senior Advisor to the Mayor and Director of the Office of Strategic Partnerships. “Our goal is to find and scale new solutions to age-old problems by bringing the public and private sectors together to address challenges and improve the lives of all New Yorkers.”

The Office of Strategic Partnerships has worked with the City-affiliated independent nonprofit organizations or “Funds” and City Agency partners to implement innovative public-private partnerships leveraged by the expertise, resources, and skills of the business, philanthropic and non-profit sectors. Over $400 million was raised for public-private partnerships during the first term to address inequality through the City affiliated Funds; the Mayor’s Fund to Advance NYC, the Fund for Public Health in NYC, the Fund for Public Schools, the Fund for Public Housing,  NYC Police Foundation, FDNY Foundation, and the Aging in New York Fund.

The report highlights the impacts of three types of strategic partnerships:

1.       Partnerships that Develop and Test Innovative, Evidence Based Models. Here, private or philanthropic funds act as risk capital and are deployed to pilot a new programmatic approach. Rigorous evaluation follows program roll out.

·         Connections to Care - 1,000 community based organization staff trained in evidence-based mental health interventions providing screening and referrals to 9,000 New Yorkers to date and 40,000 over five years

2.      Partnerships that Drive Systems Change. These partnerships are interventions that institutionalize new methods of effective service delivery–often a boldly different approach to a problem– and where a relatively small dollar investment can drive significant and systemic change.

·         Computer Science For All -  all 1.1 million NYC public school students will receive computer science education by 2025

·         The Center for Youth Employment - 100,000 internships, mentorships and summer jobs per year for NYC’s youth

·         Service Design Studio - provided 80 office hour sessions for more than 29 City agencies to feature human-centered design in their work

·         Gun Violence Reduction- $20 million committed annually by the City to expand proven gun violence reduction programs to 17 precincts—based on the success of the Cure Violence public-private partnership

3.      Partnerships that Enlist Private Capital to Complement, Enhance, and Leverage Public Investment. These are partnerships in which relatively small amounts of private capital can complement, enhance, and leverage already significant public investment to achieve improved outcomes and fully realize the potential of these commitments.

·         Vision Care with Warby Parker - Over 40,000 Community School students received eye exams and free, stylish prescription glasses from Warby Parker with more than 150,000 students screened for vision issues.

·         Building Healthy Communities – Program to improve health and wellness in 12 historically underserved neighborhoods. Estab­lished first in the nation farms on public housing property, delivered 25,000 pounds of free fresh food, trained 150 local volunteer instructors trained to give free bilingual exercise classes, planned construction for 50 mini soccer fields, engaged over 150 community partners

·         Get Alarmed NYC- 155,000 free photoelectric combination smoke/carbon monoxide alarms installed in homes of tens of thousands of City residents in at-risk communities

·         NYCitizenship - 9,000 immigrants engaged through NYCitizenship, 1,600 screened for citizenship eligibility, 800 applications assisted resulting in 200 new citizens in year one of program.

Fifteen Alleged Members of Peoria Street Gang Charged in Federal RICO Indictment for Gang Violence, Murder, Attempted Murder

  PEORIA, Ill. – A federal indictment unsealed today charges 15 alleged members of the Peoria street gang Bomb Squad with organized violent gang activity including murder and attempted murder. The indictment alleges that those charged are participants in a racketeering conspiracy that has committed numerous shootings and acts of violence, including the April 8, 2018, murder of a rival gang member and a bystander, a Bradley University student.

U.S. Attorney John E. Childress; ATF Resident Agent in Charge Tom Dart, Springfield Field Office; Peoria Interim Chief of Police Loren Marion III; DEA Assistant Special Agent in Charge Glenn Haas, Chicago Field Division; Peoria County State’s Attorney Jerry Brady; and Peoria Mayor Jim Ardis made the announcement.

The indictment charges the defendants with federal racketeering conspiracy under the Racketeer Influenced and Corrupt Organizations Act (RICO). Under the RICO statute, the indictment alleges that from 2013 to the present, the defendants functioned as a criminal enterprise to achieve its objectives, including activities that affect interstate commerce. Members and associates of Bomb Squad allegedly engaged in acts of violence, including murder, attempted murder, assault with a dangerous weapon, arson, and drug trafficking. The enterprise used violence to protect itself, its members and associates from rival gangs and to protect the standing and reputation of Bomb Squad.

All of the 15 defendants named in the indictment are charged with one count of RICO conspiracy, an offense which carries a statutory penalty of up to life in prison, if convicted. Those charged include: Eugene Haywood, aka “Nunu,” 24; Raevaughn Rogers, aka “Lil Poppi,” 18; Kenwan Crowe, 19; Terry Moss, aka “Lil Man,” 23; Ezra Johnson, aka “Lil Wody,” 22; Jovan McCree, aka “Vano,” 36; Jahlin Wilson, aka “BD,” 21; Andre Neal-Ford, aka “Monkey Man,” 20; Lance Washington, 22; Torieuanno White, aka “T.A.,” 24; Sherman Williams, aka “Shady,” 26; Lloyd Dotson, 27; Keith Gregory, aka “Kilo,” 19; Mytrez Flora, aka “Trez,” 24; and Kentrevion Watkins, aka “Tutu,” 19.   

Twelve of the defendants are also charged with one or more counts of Violent Crimes in Aid of Racketeering (VICAR) that include assault with a dangerous weapon and attempted murder, and with using firearms during the commission of a violent crime. In addition, the indictment includes charges of drug trafficking in marijuana, crack cocaine, and heroin, and possession of firearms by felons.

To further the conspiracy and achieve its objectives, the indictment alleges 46 overt acts in which gang members and associates engaged in murder, drug trafficking, witness tampering, arson, and robbery. Included among the overt acts alleged are the following:

• June 23, 2013, Haywood murdered Eric “Greedy” Brown, who he believed to be a rival gang member;
• July 15, 2013, Haywood, Flora, Dotson and deceased Bomb Squad leader Raheem Wilson, aka “Boosie,” conspired to shoot and murder Tyrann Chester, whom they believed to be supplying drugs to a dealer operating independently of Bomb Squad in Bomb Squad territory;
• May 12, 2016, Wilson robbed and shot unnamed victim during a dice game because he believed the victim was dealing drugs in Bomb Squad territory and not sharing the proceeds;
• June 13, 2016, McCree shot a .308 caliber rifle at a car he believed was occupied by rival gang members driving on Arago Street, in Bomb Squad territory. One of the bullets passed through the wall of a residence and struck an 11-year-old girl in the leg as she slept on a couch;
• Feb. 12, 2017, Moss attempted to set fire to the home of an individual he believed to be a rival gang member, in retaliation for the murder of deceased Bomb Squad leader Raheem Wilson, aka “Boosie;”
• Aug. 9, 2017, Williams, Crowe and other Bomb Squad members burglarized a house and stole a safe containing 12 guns which were then distributed to other Bomb Squad members;
• April 4, 2018, Johnson attempted to persuade a witness from testifying in a trial wherein Haywood is charged with shooting an individual with a firearm. When the witness refused to accept a bribe, Johnson threatened the witness;
• April 8, 2018, Watkins provided a juvenile Bomb Squad member with Crowe’s handgun which the juvenile then allegedly used to shoot and kill Anthony Polnitz and Nasjay Murry.

The indictment was returned by the grand jury on June 20, and sealed pending today’s arrests. ATF agents were assisted by the U.S. Marshals Service to make the arrests. Those arrested this morning are expected to make their respective initial appearances in federal court this afternoon. Five of the defendants already in state custody, in Peoria county for state cases or serving a sentence at the Illinois Department of Corrections, are expected to appear in federal court for their initial appearances later this week and early next week.

Members of the public are reminded that an indictment is merely an accusation; each defendant is presumed innocent unless proven guilty.

The charges are the result of an ongoing investigation by an Organized Crime Drug Enforcement Task Force (OCDETF), a partnership of federal, state and local law enforcement agencies working together to identify, disrupt and dismantle drug trafficking organizations and violent street gangs.

Law enforcement agencies conducting the investigation include ATF, the Peoria Police Department, and DEA, in coordination with the Office of Peoria County State’s Attorney Jerry Brady. Assistant U.S. Attorney Ron Hanna is coordinating the investigation and prosecuting the case on behalf of the government in the Peoria Division, Central District of Illinois.

In addition, this case is part of Project Safe Neighborhoods (PSN), a federal program designed to bring together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The program was reinvigorated in 2017 as part of the Department of Justice’s renewed focus on targeting each community’s most violent criminals.

Three Men Arrested And Charged With Trading On Inside Information Misappropriated From A Credit Rating Agency

  Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the arrests of SEBASTIAN PINTO-THOMAZ, ABELL OUJADDOU, and JEREMY MILLUL for their participation in a scheme to trade on material, nonpublic information (the “Inside Information”) misappropriated by PINTO-THOMAZ from his employer, a credit rating agency based in New York (the “Firm”).  The scheme yielded almost $300,000 in illegal profits.

PINTO-THOMAZ, OUJADDOU, and MILLUL were arrested this morning in New York, New York, and will be presented today before United States Magistrate Judge Nathaniel Kevin Fox.  In a separate action, the Securities and Exchange Commission (“SEC”) filed civil charges against PINTO-THOMAZ, OUJADDOU and MILLUL.

U.S. Attorney Geoffrey Berman said:  “As alleged, Sebastian Pinto-Thomaz used his position with a credit rating agency, where he was privy to business acquisition plans before they were publicly announced, to provide inside information to two friends who traded on the information and reaped thousands in profits.  Then, when asked about this illicit trading, Pinto-Thomaz painted himself into a corner, falsely denying any relationship with his two co-conspirators.  Our Office has always been – and remains – committed to ensuring that the nation’s securities markets remain fair for everyone, not just those who have friends in the know.”

FBI Assistant Director-in-Charge William F. Sweeney Jr. said:   “Aiming to fill their pockets, the defendants allegedly conspired to use Inside Information to advance their greedy agendas.  This alleged fraud triangle produced nearly $300,000 in profit among the three defendants.  As alleged, Pinto-Thomaz abandoned his duties of loyalty and confidentiality by passing material nonpublic information to his co-conspirators who then made illegal trades. We hope that today’s arrests will show all like-minded schemers that this alleged behavior ultimately does get you to the inside – of a federal prison.”

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

Rating Evaluation Services and the Insider

When a company announces an acquisition, the acquiring company’s credit rating agency often evaluates, and ultimately issues a press release relating to, the impact that the acquisition could have on the acquiring company’s credit rating.  Therefore, companies often contact rating agencies before an acquisition is publicly announced in order to secure the rating agency’s views on how a possible acquisition could affect a company’s credit rating.  All the major rating agencies offer a product – sometimes known as a Rating Evaluation Service (“RES”) – that provides the company with a rating committee decision with respect to a proposed acquisition.

In March 2016, a credit rating agency in Manhattan (the “Firm”) assigned PINTO-THOMAZ, a credit ratings analyst, to work on an RES for the Sherwin-Williams Company (“Sherwin-Williams”) in advance of its contemplated but unannounced acquisition of the Valspar Corporation (“Valspar”).  In connection with this assignment, PINTO-THOMAZ had access to Inside Information about Sherwin-Williams’s acquisition of Valspar prior to the public announcement of the acquisition.  The Firm’s written policies prohibited the unauthorized disclosure of confidential information, which included the Inside Information.  During his tenure at the Firm, PINTO-THOMAZ reviewed and certified his duties of loyalty and confidentiality to the Firm and its clients.

The Insider Trading Scheme

In March 2016, PINTO-THOMAZ misappropriated the Inside Information about the Sherwin-Williams acquisition of Valspar and passed it to OUJADDOU and MILLUL so they could use it to make profitable trades.  On March 21, 2016, the first trading day after the public announcement of the acquisition, the price of Valspar stock increased approximately 23 percent over the prior day’s close.

OUJADDOU is a Manhattan hairstylist and salon owner who has a close relationship with PINTO-THOMAZ, as well as with a member of PINTO-THOMAZ’s immediate family (the “Relative”).  PINTO-THOMAZ repeatedly provided OUJADDOU with Inside Information about the Valspar acquisition, oftentimes shortly after PINTO-THOMAZ became aware of the Inside Information through his work at the Firm. From March 10, 2016, through March 18, 2016, OUJADDOU, who had never previously purchased Valspar or Sherwin-Williams securities, used the Inside Information he had received from PINTO-THOMAZ to purchase 8,630 shares of Valspar stock.  After the acquisition was publicly announced, OUJADDOU sold his Valspar shares for approximately $192,080 in profits.

MILLUL is a Manhattan jeweler who has a close personal friendship with PINTO-THOMAZ and the Relative.  PINTO-THOMAZ also provided MILLUL with Inside Information about the Valspar acquisition.  Although MILLUL had never owned a brokerage account in the United States and had never traded in U.S. securities prior to March 2016, he opened a brokerage account on March 13, 2016, and shortly thereafter purchased 480 shares of Valspar common stock.  On March 18, 2016, the last trading day before the acquisition was publicly announced, MILLUL also purchased 75 Valspar out-of-the-money call options.  After the acquisition was publicly announced, MILLUL sold his Valspar stock and options for approximately $106,806 in profits.  In December 2016, MILLUL gave PINTO-THOMAZ $3,500 in cash.

PINTO-THOMAZ Makes False Statements About

OUJADDOU and MILLUL in Connection with a FINRA Inquiry

In June 2016, the Financial Industry Regulatory Authority (“FINRA”) sent the Firm a list of individuals and entities who had traded in Valspar in advance of the public announcement of the acquisition (the “List”).  The Firm forwarded the List to its employees who had worked on the Sherwin-Williams RES, including PINTO-THOMAZ, asking the employees to respond by stating whether they had a past or present relationship with any individual or entity on the List. Although both OUJADDOU and MILLUL were on the List, PINTO-THOMAZ denied having a relationship with anyone on the List. 

PINTO-THOMAZ, 32, ABELL OUJADDOU, 55, and JEREMY MILLUL, 31, all of New York, New York, are each charged with one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison and a maximum fine of $250,000, or twice the gross gain or loss from the offense, and one count of securities fraud, which carries a maximum sentence of 20 years in prison and a maximum fine of $5 million, or twice the gross gain or loss from the offense.  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 would be determined by the Court.

In addition, the Government, pursuant to Court authorized seizure warrants, has seized $100,000 from a bank account belonging to MILLUL, and over 25,000 shares of BlackBerry stock from brokerage accounts belonging to OUJADDOU, as these assets constitute, or are traceable to, proceeds of the illegal conduct alleged in the Complaint.

Mr. Berman praised the work of the FBI, and thanked the SEC for its assistance.

The allegations contained in the Complaint are merely accusations, and the defendant is 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 herein, constitute only allegations, and every fact described therein should be treated as an allegation.

A.G. Underwood Announces Indictment Of New York Doctor For Manslaughter In Opioid Death

74-Count Indictment Charges Physician Barry Sloan with Recklessly Causing Patient’s Overdose Death by Knowingly Selling Fentanyl Prescriptions 

Sloan Also Charged with Multiple Counts of Criminal Sale, Reckless Endangerment, and Health Care Fraud

  New York Attorney General Barbara D. Underwood today announced the indictment of physician Barry Sloan, D.O., 60, for Manslaughter in the Second Degree, for recklessly causing the death of a patient, L.W., a Manhattan resident who died at the age of 36 from a fentanyl overdose. Sloan is also charged with multiple counts of Criminal Sale of a Prescription for a Controlled Substance or of a Controlled Substance by a Practitioner or Pharmacist, and other charges arising from knowingly and unlawfully selling a prescription for a controlled substance other than in good faith in the course of his professional practice, to L.W. and four other former patients.

“The opioid epidemic is ravaging New York’s families – and, too often, there are drug dealers in white coats fueling the crisis in order to line their own pockets,” said Attorney General Underwood. “Our office will ensure that those who abandon their medical oaths are brought to justice, and continue to use every tool we have to tackle the evolving opioid epidemic.”

As detailed in the indictment and court proceedings, Sloan has held himself out as a pain management specialist in New York and New Jersey since at least 2011 through 2016. During that time, respective state data show that he prescribed controlled substances over 70,000 times, the majority of which were for Schedule II drugs—the most risky and addictive drugs, according to the U.S. Drug Enforcement Agency. One of the most deadly -- and a prime component of the national opioid crisis -- is oxycodone 30 mg tablets. State data shows Sloan prescribed oxycodone 30 mg over 26,000 times to approximately 2,000 unique patients — for a total of over four million pills, with an estimated street value of over $100 million. Among New York Medicaid’s 17,000 prescribers of oxycodone 15 mg and 30 mg pills, Sloan was the 18th highest prescriber. 

In addition, Sloan was the fourth highest prescriber in New York of “Subsys,” a powerful narcotic approved by the FDA solely to treat “breakthrough” pain in late-stage cancer patients. The active ingredient in Subsys is fentanyl, which the Centers for Disease Control and Prevention (CDC) states is 100 times more powerful than morphine and 50 times more powerful than heroin; it is the most potent chemical of its class legally allowed to be used in humans. 

Sloan regularly took cash from his patients for each office visit, averaging at approximately $200 per office visit, as alleged in the indictment and court proceedings.

The indictment alleges that defendant Sloan issued multiple prescriptions for controlled substances to L.W. every month for over a year, from mid-2013 to mid-2014.  Four days before L.W.’s death from overdose in the early morning of August 9, 2014, Sloan wrote two separate prescriptions for L.W., each for a different dosage of 60 separate single-use spray bottles of Subsys. The indictment alleges that, before meeting Sloan, L.W. had been a generally healthy person.

The New York County grand jury indictment further alleges that Sloan criminally sold prescriptions to L.W. and four other persons and thereby engaged in Reckless Endangerment in the First Degree between June 2012 and June 2016.

The indictment further alleges that a portion of the Medicaid cost of such fraudulent prescriptions issued by Sloan were paid by Healthfirst, a Medicaid Managed Care Organization contracted to the State of New York, constituting the crime of Health Care Fraud in the Third Degree; Sloan also further falsified business records to obtain prior authorization for narcotic medications. 

In total, the indictment alleges 74 counts of felony criminal offenses.

“Dr. Sloan became a drug dealer in a white coat who violated his Hippocratic oath to ‘do no harm,’ and callously contributed to the opioid epidemic plaguing this city and our society while stealing from Medicare and Medicaid,” said Special Agent in Charge Scott J. Lampert of the U.S. Department of Health and Human Services, Office of Inspector General’s New York Region (HHS-OIG). “HHS-OIG will continue to work with our law enforcement partners in an effort to curtail the opioid abuse epidemic, protect patient quality of care, and safeguard the taxpayer dollars that go to all of our federally funded health care programs.”

The public is advised that Barry Sloan’s license to prescribe controlled substances was revoked by the U.S. Drug Enforcement Agency.  Persons with knowledge of Sloan’s narcotic prescribing practices may assist in obtaining evidence and information related to this investigation by contacting the New York State Medicaid Fraud Control Unit at (800) 771-7755, or online at https://ag.ny.gov/comments-mfcu .

The Attorney General encourages anyone exposed to over-prescription of opioids to seek medical care or reach out to the New York State HOPEline at 1-877-8-HOPENY.

Barry Sloan was arrested today by police investigators from the Attorney General’s Office. The case was arraigned before Hon. Maxwell Wiley Supreme Court, New York County, and adjourned to August 8. Bail was set at $75,000.

The top charges against Sloan are class C felonies, with a maximum sentence on each count of 5 to 15 years imprisonment.

The charges the defendant are merely allegations, and the defendant is presumed innocent unless and until proved guilty in court.

The Attorney General thanked Special Agent April Cameron and Assistant Special Agent in Charge Naomi Gruchacz and their colleagues at the New York field office of the Office of the Inspector General, U.S. Department of Health and Human Services. The Attorney General would also like to thank the New York State Department of Health, Office of Professional Medical Conduct (OPMC) and Bureau of Narcotic Enforcement (BNE), the Office of the Special Narcotics Prosecutor for the City of New York, and the Office of the New Jersey Attorney General for their valuable assistance in this investigation.

The matter was investigated by staff of the Attorney General’s Medicaid Fraud Control Unit, which investigates fraud, waste, and abuse in the Medicaid program.  

The Attorney General’s office is using multi-levered strategy to tackle New York’s evolving opioid epidemic includes:

• Launching a bipartisan multistate investigation into whether opioid manufacturers and distributors engaged in any unlawful practices in the marketing and distribution of prescription opioids.
• Bringing New York’s most effective law enforcement resources together in the ongoing SURGE Initiative to root out violent drug trafficking in rural communities and upstate New York. Since launching one year ago today, SURGE has taken down nine major drug trafficking rings across New York – resulting in 302 traffickers taken off the streets.
• Obtaining settlements with major national and global health insurers including Cigna and Anthem, which insure over 4 million New Yorkers, to remove barriers to life-saving treatment for opioid use disorder. The agreements put an end to the insurers’ policy of requiring prior authorization for medication-assisted treatment (“MAT”), which can lead to significant delays for patients seeking relief from addiction.
• Creating the Internet System for Tracking Over-Prescribing Act (“I-STOP”), a series of enhancements to New York’s prescription drug monitoring program that provide doctors with patient’s up-to-date controlled substance prescription history, requires electronic prescriptions, and establishing a safe disposal program providing a place for New Yorkers to get rid of expired and unneeded drugs—thus reducing the likelihood of stolen and forged prescriptions being used to obtain controlled substances from pharmacies. I-STOP reduced “doctor shopping,” a practice in which an individual attempts to obtain the same or similar prescriptions from multiple physicians, by 90% since 2014.
• Launching the Community Overdose Prevention (“COP”) program, a life-saving initiative that enabled state and local law enforcement officers in the state of New York to carry naloxone, the extremely effective heroin antidote that can immediately reverse the effects of an opioid overdose. Since the program’s implementation in April 2014, more than 100 overdoses were reversed using kits provided by the COP program, which distributed over 27,000 kits across the state.
• Obtaining an agreement with Amphastar Pharmaceuticals, to cut and cap the price of naloxone for all agencies in New York State, reducing the price of naloxone by nearly 20 percent.
• Enforcing Mental Health Parity Laws to reach agreements with six health insurance companies, requiring them to implement sweeping reforms in their administration of behavioral health benefits, in particular relating to medical management practices, coverage of residential treatment for substance abuse, and co-pays for outpatient treatment, and to submit regular compliance reports. The agreements ultimately provided millions of dollars in penalties and over $2 million in restitution for members whose claims were improperly denied.
• Successfully prosecuting more than ten licensed prescribers including operators of “pill mills” and other unlawful practices for crimes related to improper opioid prescriptions.
• Urging health insurance companies to review their coverage and payment policies that contribute to the opioid epidemic, as well as sending letters to the country’s three largest pharmacy benefit managers requesting documents, data, and other information regarding how they are addressing the opioid crisis.
• Launching a new website to help New Yorkers safely dispose of unused opioids.

MAYOR DE BLASIO SIGNS LEGISLATION PROVIDING SUBSTANCE ABUSE TREATMENT SERVICES AND ESTABLISHING CITYWIDE ANIMAL SHELTERS

  Today, Mayor de Blasio signed seven bills to provide substance abuse treatment and prevention services to New Yorkers. The Mayor also signed a bill requiring the creation of full-time animal shelters in all five boroughs.

“The City is committed to fighting the opioid epidemic with every tool we have. The legislation signed today will help us ensure that all New Yorkers struggling with substance abuse have access to the care they need,” said Mayor Bill de Blasio. “We also know how much New Yorkers love their pets, and this expansion of our shelter system will help more animals  find permanent homes.”

“The opioid epidemic has already taken too many lives and hurt too many families in New York, and I am proud that the Council’s package of legislation on this dire issue will be signed into law today. These treatment, prevention, and education measures will lend an immediate hand to New Yorkers who desperately need help to fight the opioid scourge,” said Speaker Corey Johnson. “I am also thrilled Council Member Vallone’s bill providing for animal shelters in all five boroughs is becoming law today. This has been a pet issue of both of ours for years now, and it is a major step forward for how this city takes care of its furry friends.”

Providing Substance Abuse Treatment and Prevention Services

The opioid epidemic has had serious effects on families throughout New York City. Rates of drug overdose deaths in New York City more than doubled between 2010 and 2016, increasing from 8.2 per 100,000 residents in 2010 to 19.9 per 100,000 residents in 2016. DOHMH reports that while drug overdose deaths affect every neighborhood and demographic in New York City, residents of impoverished neighborhoods are the hardest hit.

In March, the Mayor announced an additional $22 million investment in HealingNYC, the citywide plan to combat the opioid epidemic. This new investment will create peer intervention programs at more hospitals across the City, increase naloxone distribution and training on how to use this lifesaving drug, and connect more New Yorkers struggling with substance misuse to treatment. The legislation signed today furthers the critical mission of reducing opioid overdose deaths.

• Intro 615-A requires the Department of Health and Mental Hygiene (DOHMH) to provide opioid overdose reversal drugs, such as naloxone, to all syringe exchange programs operating in the City.

• Intro 618-A requires the Department of Health and Mental Hygiene to develop age appropriate educational materials on drug and opioid awareness and prevention.

• Intro 623-A requires the Fire Department of New York to report on the number of opioid antagonists the department has available, the number of EMTs and other department employees trained to administer opioid antagonists, and the number of opioid overdose reversal drugs administered by EMTs.

• Intro 667-A requires the Department of Social Services to refer individuals residing in Department of Homeless Services’ shelters or HIV/AIDS Service Administration (HASA) facilities that suffered a non-fatal overdose to additional services.

• Intro 668-A requires the Department of Health and Mental Hygiene (DOHMH) to provide opioid overdose prevention and reversal training to the public

• Intro 669-A requires the Municipal Drug Strategy Advisory Council, a council established by Local Law 48 of 2017 and comprised of health care professionals, advocates, and persons suffering from substance misuse disorder, to include in its biennial report the number of opioid overdose reversal drugs that are distributed to City agencies.

• Intro 717-A requires the New York City Police Department to report quarterly – to the City Council and the Department of Health and Mental Hygiene – on the number of opioid antagonists the department has available, the number of officers trained to administer opioid antagonists, and the number of opioid overdose reversal drugs administered by NYPD Officers.

Establishing Animal Shelters in Every Borough

The de Blasio administration has taken steps to expand and improve the animal shelter system in New York City. Animal Care Centers, the city’s open-admission shelters, have been funded at record levels and have seen historic animal placement. Facilities in Manhattan, Brooklyn, and Staten Island will receive substantial capital improvements and new shelters will be constructed in the Bronx and Queens.

• Intro 401-A requires the DOHMH to ensure that full-service animal shelters are operated in all five boroughs by July 1, 2024. While the City operates facilities to receive lost, stray, or homeless dogs and cats in the Bronx and Queens, neither borough is currently served by a full-service animal shelter.