Former Bank Officer Sentenced to 18 Months in Prison for Accepting Bribes, Bank Fraud

CAMDEN, NJ—A former bank officer was sentenced today to 18 months in prison for accepting bribes of more than $50,000 in return for his assistance in corrupt financial transactions, as well as bank fraud, U.S. Attorney Paul J. Fishman announced.

Jose Dominguez, 47, of Newark, New Jersey, previously pleaded guilty before U.S. District Judge Noel L. Hillman to an information charging him with soliciting and accepting bribes in excess of $1,000 as a bank officer. He had also pleaded guilty to a separate indictment charging him with bank fraud and conspiracy to commit bank fraud. Judge Hillman imposed the sentence today in Camden federal court.

According to documents filed in this case and statements made in court:

From January 1988 to February 2007, Dominguez was employed as a loan officer at Spencer Savings Bank in Elmwood Park, New Jersey. From September 2004 to November 2004, Dominguez and Victor Patela, 38, a former Newark Police officer, conspired to fraudulently obtain a $1.92 million commercial loan from Spencer Savings Bank so that they could purchase apartment buildings in Elizabeth, New Jersey. In connection with this scheme, Dominguez and Patela made false representations to Spencer Savings Bank relating to Patela’s assets in order to obtain the commercial loan. Dominguez also accepted bribe payments from Patela in exchange for using his influence as a loan officer to obtain the $1.92 million loan. In June 2012, Patela was convicted at trial of bank fraud, conspiracy to commit bank fraud, two counts of loan application fraud, and bank bribery and sentenced in April 2013 to 48 months in prison.

In 2003, Dominguez was contacted by a bank customer who wanted to refinance some loans with Spencer Savings Bank and wanted to do so without paying significant prepayment penalty fees. Dominguez advised the customer that if the customer made corrupt payments to Dominguez, the customer could obtain a lower interest rate without paying a prepayment penalty to Spencer Savings Bank.

Between August 2003 and December 2003, Dominguez accepted $55,529.57 in corrupt payments from the customer to influence the requested loan modification. Dominguez also admitted to accepting additional bribes from other bank customers in the amounts of $4,500 and $5,000, respectively.

In addition to the prison term, Judge Hillman sentenced Dominguez to three years of supervised release and fined him $4,000.

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark, with the investigation leading to today’s sentencing.

The government is represented by Assistant U.S. Attorney Vikas Khanna of the U.S. Attorney’s Office Special Prosecutions Division in Newark.

Two Executives Sentenced for Convictions in SK Foods Investigation

SACRAMENTO, CA—United States District Judge Lawrence K. Karlton sentenced two defendants charged in the SK Foods investigation, United States Attorney Benjamin B. Wagner announced. Former food broker Randall Rahal, 65, of Nantucket, Massachusetts, was sentenced today to three years in prison. Former senior vice president of SK Foods, Alan Huey, 57, of Pebble Beach, California, was sentenced to three years’ probation with a special condition of 60 days’ intermittent confinement.
According to court documents, Rahal paid bribes on behalf of SK Foods to the purchasing officers of customers of SK Foods. He had been the subject of multiple wiretaps in 2007 and 2008. Huey had been a member of the SK Foods senior management team and admitted to directing others to falsely label food product.
In sentencing the two defendants, Judge Karlton remarked that their crimes had been very serious and called for substantial prison sentences. Because Huey’s wife has serious health problems and is entirely dependent on him for care, Judge Karlton sentenced Huey to probation.
These cases were the product of an investigation by the FBI, IRS-Criminal Investigation, FDA-Office of Criminal Investigations, and the Antitrust Division of the U.S. Department of Justice. Assistant United States Attorneys Matthew D. Segal and Jared C. Dolan and Antitrust Division Trial Attorneys Anna T. Pletcher and Tai Milder prosecuted the cases.

French Citizen Pleads Guilty to Obstructing Criminal Investigation into Alleged Bribes Paid to Win Mining Rights in the Republic of Guinea

WASHINGTON—Frederic Cilins, 51, a French citizen, pleaded guilty today in the Southern District of New York to obstructing a federal criminal investigation into whether a mining company paid bribes to win lucrative mining rights in the Republic of Guinea.
Mythili Raman, Acting Assistant Attorney General for the Justice Department’s Criminal Division; Preet Bharara, the U.S. Attorney for the Southern District of New York; and George Venizelos, the Assistant Director in Charge of the FBI’s New York Field Office, made the announcement.
Cilins pleaded guilty to a one-count superseding information filed today, which alleges that Cilins agreed to pay money to induce a witness to destroy, or provide to him for destruction, documents sought by the FBI. According to the superseding information, those documents related to allegations concerning the payment of bribes to obtain mining concessions in the Simandou region of the Republic of Guinea.
According to publicly filed documents, Cilins allegedly attempted to obstruct an ongoing federal grand jury investigation concerning potential violations of the Foreign Corrupt Practices Act and laws proscribing money laundering. Court documents state the federal grand jury was investigating whether a particular mining company and its affiliates—on whose behalf Cilins had been working—transferred into the United States funds in furtherance of a scheme to obtain and retain valuable mining concessions in the Republic of Guinea’s Simandou region. During monitored and recorded phone calls and face-to-face meetings, Cilins allegedly agreed to pay substantial sums of money to induce a witness to the bribery scheme to turn over documents to Cilins for destruction, which Cilins knew had been requested by the FBI and needed to be produced before a federal grand jury. Court documents also allege that Cilins sought to induce the witness to sign an affidavit containing numerous false statements regarding matters under investigation by the grand jury.
Court documents allege that the documents Cilins sought to destroy included original copies of contracts between the mining company and its affiliates and the former wife of a now-deceased Guinean government official, who at the relevant time held an office in Guinea that allowed him to influence the award of mining concessions. The contracts allegedly related to a scheme by which the mining company and its affiliates offered the wife of the Guinean official millions of dollars, which were to be distributed to the official’s wife as well as ministers or senior officials of Guinea’s government whose authority might be needed to secure the mining rights.
According to court documents, the official’s wife incorporated a company in 2008 that agreed to take all necessary steps to secure the valuable mining rights for the mining company’s subsidiary. That same contract stipulated that $2 million was to be transferred to the official’s wife’s company and an additional sum was to be “distributed among persons of good will who may have contributed to facilitating the granting of” the valuable mining rights. According to the complaint, in 2008, the mining company and its affiliates also agreed to give 5 percent of its ownership of particular mining areas in Guinea to the official’s wife.
The case is being investigated by the FBI. The case is being prosecuted by Trial Attorney Tarek Helou of the Criminal Division’s Fraud Section and Assistant United States Attorney Elisha J. Kobre of the Southern District of New York. The Justice Department’s Office of International Affairs and Office of Enforcement Operations also assisted in the investigation.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.

Doctor Admits Taking Bribes in Test Referral Scheme with New Jersey Clinical Lab

NEWARKJ—An internist with a practice in Montclair, New Jersey, admitted today accepting bribes in exchange for test referrals as part of a long-running scheme operated by Biodiagnostic Laboratory Services LLC (BLS), of Parsippany, New Jersey; its president; and numerous associates, U.S. Attorney Paul J. Fishman announced.
Charles Goldberg, 60, of West Orange, New Jersey, pleaded guilty before U.S. District Judge Stanley R. Chesler in Newark federal court to an information charging him with one count of accepting bribes.
Including Goldberg, 23 people—12 of them physicians—have pleaded guilty in connection with the bribery scheme, which its organizers have admitted involved millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies.
According to documents filed in these and related cases and statements made in court:
Goldberg admitted accepting bribes of $1,800 per month through a sham lease agreement with BLS, which identified the waiting room, bathroom, and one examination room in Goldberg’s office as being leased.
The bribery count to which Goldberg pleaded guilty carries a maximum potential penalty of five years in prison and a $250,000 fine. He will be sentenced on a date to be determined. As part of his guilty plea, Goldberg agreed to forfeit $58,000, representing the bribes he received from BLS.
The BLS investigation has recovered more than $7 million to date through forfeiture.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Thomas O’Donnell; IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen; and inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Maria L. Kelokates, with the ongoing investigation leading to today’s guilty pleas.
The government is represented by Senior Litigation Counsel Andrew Leven, Assistant U.S. Attorney Joseph Minish, and Jacob T. Elberg, Chief of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark, as well as Assistant U.S. Attorney Barbara Ward of the office’s Asset Forfeiture and Money Laundering Unit.
U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $535 million in health care fraud and government fraud settlements, judgments, fines, restitution, and forfeiture under the False Claims Act; the Food, Drug, and Cosmetic Act; and other statutes.

Former Bayonne Official Admits Accepting $65,000 in Bribes for Awarding HUD Grant Funds

TRENTON, NJ—A Hudson County, New Jersey man who served as the senior accountant of the City of Bayonne Department of Community Development (CBDCD) today admitted accepting $65,000 in bribe payments in exchange for his assistance in awarding projects funded by U.S. Department of Housing and Urban Development grants, U.S. Attorney Paul J. Fishman announced.
Anselmo Crisonino, 53, of Bayonne, pleaded guilty before U.S. District Judge Peter G. Sheridan in Trenton federal court to a four-count information charging him with one count of accepting bribe payments totaling approximately $65,000 from Joseph Arrigo, the owner of a contracting company in Bayonne. Crisonino also pleaded guilty to one count of theft and conversion of federal funds ($422,360), one count of conducting an illegal gambling business, and one count of submitting a false tax return for tax year 2011.
According to documents filed in this case and statements made in court:
The CBDCD was an agency that received funds from the U.S. Department of Housing and Urban Development (HUD) under a federal program that provided grants up to $20,000 to low income families to rehabilitate their homes and to repair conditions affecting health and safety, accessibility, energy efficiency, or code compliance. The CBDCD also provided these HUD funds under the same federal program to non-profit organizations. Crisonino was responsible for reviewing applications and awarding such funds to qualified applicants.
In September 2010, Crisonino solicited cash bribe payments from Arrigo in exchange for Crisonino’s assistance in awarding HUD grant funds from the CBDCD to Arrigo as the owner of Shadow Contracting LLC. From September 2010 to February 2013, Crisonino received cash payments from Arrigo totaling approximately $65,000 in exchange for Crisonino’s assistance in awarding HUD grant funds from the CBDCD to Arrigo that totaled approximately $426,000.
Between September 2010 and February 2013, Crisonino awarded HUD grant funds to several contractors and plumbers in Bayonne through the CBDCD, despite the fact that Crisonino knew that the submitted bids for the projects were fraudulent and were the result of collusion by the contractors and plumbers. Crisonino also approved change orders on projects where little to no legitimate work had been done by the contractors and plumbers at the job sites. The approved change orders allowed the CBDCD to disperse additional HUD grant funds to the projects that had already reached the maximum $20,000 grant allotment.
Crisonino also pleaded guilty to conducting an illegal gambling business in northern New Jersey. The illegal gambling business was administered and managed through a website that Crisonino and others accessed through usernames and passwords.
He admitted making and subscribing a U.S. Individual Tax Return, Form 1040, for tax year 2011 filed with the IRS, which he did not believe to be true and correct as to every material matter, including approximately $65,000 in unreported income through the bribe payments.
The bribery and theft of government funds charges to which Crisonino pleaded guilty are each punishable by a maximum potential penalty of 10 years in prison. The charge of conducting an illegal gambling business is punishable by a maximum potential penalty of five years in prison. The charge of filing a false tax return is punishable by a maximum potential penalty of three years in prison. All of four charges are also punishable by a $250,000 fine. Sentencing is currently scheduled for June 4, 2014.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford in Newark; special agents of the U.S. Department of Housing and Urban Development, Office of the Inspector General, under the direction of Special Agent in Charge Christina Scaringi; and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen in Newark, with the continuing investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Jacques S. Pierre of the Special Prosecutions Division and Assistant U.S. Attorney Steven G. Sanders of the Appeals Division.

Alcoa World Alumina Agrees to Plead Guilty to Foreign Bribery Charges and Pay $223 Million in Fines and Forfeiture

WASHINGTON—Alcoa World Alumina LLC, a majority-owned and controlled global alumina sales company of Alcoa Inc., has agreed to plead guilty later today and pay $223 million in criminal fines and forfeiture to resolve charges that it paid millions of dollars in bribes through an international middleman in London to officials of the Kingdom of Bahrain, in violation of the Foreign Corrupt Practices Act (FCPA).
Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division, U.S. Attorney David J. Hickton of the Western District of Pennsylvania, Chief Richard Weber of IRS-Criminal Investigation (IRS-CI), and Assistant Director in Charge Valerie Parlave of the FBI’s Washington Field Office made the announcement.
“Alcoa World Alumina today admits to its involvement in a corrupt international underworld in which a middleman, secretly held offshore bank accounts, and shell companies were used to funnel bribes to government officials in order to secure business,” said Acting Assistant Attorney General Raman. “The law does not permit companies to avoid responsibility for foreign corruption by outsourcing bribery to their agents and, as today’s prosecution demonstrates, neither will the Department of Justice.”
“Today’s case shows that multi-national corporations cannot get away with using middlemen to structure sham business arrangements that funnel kickbacks to government officials,” said U.S. Attorney Hickton.
Alcoa World Alumina has agreed to plead guilty in the Western District of Pennsylvania to one count of violating the anti-bribery provisions of the FCPA in connection with a 2004 corrupt transaction, to pay a criminal fine of $209 million, and to administratively forfeit $14 million. As part of the plea agreement, Alcoa Inc. (Alcoa) has agreed to maintain and implement an enhanced global anti-corruption compliance program.
In a parallel action, Alcoa settled with the U.S. Securities and Exchange Commission (SEC) and will pay an additional $161 million in disgorgement, bringing the total amount of U.S. criminal and regulatory penalties to be paid by Alcoa and Alcoa World Alumina to $384 million.
“This case is the result of unraveling complex financial transactions used by Alcoa World Alumina LLC’s agent to facilitate kickbacks to foreign government officials,” said Chief Richard Weber of IRS-CI. “IRS-CI will not be deterred by the use of sophisticated international financial transactions as we continue our ongoing efforts to pursue corporations and executives who use hidden offshore assets and shell companies to circumvent the law.”
“Corrupt kickback payments to foreign government officials to obtain business diminish public confidence in global commerce,” said Assistant Director in Charge Parlave. “There is no place for bribery in any business model or corporate culture. Today’s plea demonstrates the FBI and our law enforcement partners are committed to curbing corruption and will pursue all those who try to advance their businesses through bribery.”
Today’s court filings allege that Alcoa of Australia, another Alcoa-controlled entity, originally secured a long-term alumina supply agreement with Aluminium Bahrain B.S.C. (Alba), an aluminium smelter controlled by the government of Bahrain. At the request of certain members of Bahrain’s Royal Family who controlled the tender process, Alcoa of Australia inserted a London-based middleman with close ties to certain Royal Family members as a sham sales agent and agreed to pay him a corrupt commission intended to conceal bribe payments, according to court papers. Over time, Alcoa of Australia expanded the relationship with the middleman, identified as Consultant A in today’s court filings, to begin invoicing increasingly larger volumes of alumina sales through his shell companies, which permitted Consultant A to make larger bribe payments to certain government officials, according to today’s filings.
As admitted in the charging documents, in 2004, Alcoa World Alumina corruptly secured a long-term alumina supply agreement with Alba by agreeing to purportedly sell over 1.5 million metric tons of alumina to Alba through offshore shell companies owned by Consultant A. The sham distributorship permitted Consultant A to mark up the price of alumina by approximately $188 million from 2005 to 2009, the duration of the corrupt supply agreement. Court filings allege that Consultant A used the mark-up to pay tens of millions in corrupt kickbacks to Bahraini government officials, including senior members of Bahrain’s Royal Family. To conceal the illicit payments, Consultant A and the government officials used various offshore bank accounts, including accounts held under aliases, at several major financial institutions around the world, including in Guernsey, Luxembourg, Liechtenstein, and Switzerland.
In addition to the monetary penalty, Alcoa and Alcoa World Alumina agreed to cooperate with the department in its continuing investigation of individuals and institutions involved in these matters.
The plea agreement and related court filings acknowledge Alcoa’s current financial condition as a factor relevant to the size of the criminal fine, as well as Alcoa’s and Alcoa World Alumina’s extensive cooperation with the department, including conducting an extensive internal investigation, making proffers to the government, voluntarily making current and former employees available for interviews, and providing relevant documents to the department. Court filings also acknowledge subsequent anti-corruption remedial efforts undertaken by Alcoa.
The department acknowledges and expresses its appreciation for the cooperation and assistance of the Office of the Attorney General of Switzerland, the Guernsey Financial Intelligence Service and Guernsey Police, the Australian Federal Police, the U.K.’s Serious Fraud Office, and other law enforcement authorities in the department’s investigation of this matter. The department also acknowledges and expresses its appreciation for the significant assistance provided by the SEC’s Division of Enforcement.
The investigation is being conducted by special agents and analysts with the IRS-Criminal Investigation’s Washington Field Office and the FBI’s Washington Field Office. The case is being prosecuted by Deputy Chief Adam G. Safwat and Trial Attorneys Andrew Gentin, Allan J. Medina, and Andrew H. Warren of the Criminal Division’s Fraud Section, with the assistance of the U.S. Attorney’s Office for the Western District of Pennsylvania. The Criminal Division’s Office of International Affairs also provided significant assistance during this investigation.
Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.

Painting Contractor Admits Paying $800,000 in Bribes to West Haven Housing Authority Official

Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, announced that Harry P. Miconi, 77, of West Haven, waived his right to indictment and pleaded guilty today before U.S. District Judge Michael P. Shea in Hartford to paying hundreds of thousands of dollars in bribes to a senior official at the West Haven Housing Authority.
According to court documents and statements made in court, Miconi owned and operated several painting and contracting businesses in West Haven, including P and K Contractor LLC. In pleading guilty, Miconi admitted that, between January 2007 and February 2012, he and his business made more than $800,000 in corrupt payments to a senior official at the West Haven Housing Authority and to Four Star Development Company LLC, an entity personally owned and controlled by the official. In return, the official directed millions of dollars in business for or with the West Haven Housing Authority and its two affiliated instrumentalities, Meadow Landing and Spring Heights, to instrumentalities and his businesses.
instrumentalities pleaded guilty to one count of conspiracy to commit bribery in connection with a program receiving federal funds, which carries a maximum term of imprisonment of five years. Judge Shea has scheduled sentencing for January 29, 2014.
As part of his plea, instrumentalities has agreed to pay $862,563 in restitution.
Acting U.S. Attorney Daly stated that the investigation is ongoing.
This matter is being investigated by the U.S. Department of Housing and Urban Development-Office of Inspector General, Federal Bureau of Investigation, and Internal Revenue Service-Criminal Investigation. The case is being prosecuted by Assistant U.S. Attorneys David T. Huang and Susan L. Wines.