Articles Posted in Fraud

Fleeting are the days during which the South Florida’s criminal markets were notorious purely for international drug smuggling; new reports published late last month show that crime in South Florida is an increasingly white collar, fraud-related affair.
Florida in general, for instance, ranks No. 1 in the country for identity theft complaints at a rate of 193 per 100,000 residents; but Miami itself blows the Sunshine State out of the water, with 340 complaints per 100,000 residents.

Our Palm Beach and Broward County white collar criminal defense attorneys know that in addition to the fact that South Florida’s fraud schemes are increasing in number, they are also dwarfing all other organized fraud rings throughout the United States. As Fortune bluntly states, the South Florida “region is the fraud capital of America.”
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Mail fraud is a federal crime that’s been on the books for well over a century. Basically, the use of the mail system in the perpetuation of any type of scheme, whether it began in the mail, over the telephone or on the internet, constitutes mail fraud.
As our Delray Beach and Hollywood criminal defense attorneys know, in other words, in order for federal prosecutors to nab you for mail fraud (which carries a penalty of up to 20 years in federal prison and up to $1 million in fines), they only need to demonstrate that you used the mail as part of your scheme.

A man in Boca Raton is now accused of engaging in mail fraud while in the midst of an investment scheme in which he solicited investment money from clients and then spent the money on himself, as we will explore in this blog post.
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One might not ordinarily associate Miami Dade College student accounts with massive identity theft/tax fraud, but recent charges filed against 18 current and former Miami Dade students purport to show that there was a major overlap between the two.
South Florida played host to a scheme in which identity thieves used student educational accounts intended to receive financial aid from the state to file fraudulent (stolen) income tax returns. When the Internal Revenue Service (IRS) issued tax refunds, the student accounts were used as a place to deposit the money.

Our Palm Beach, Broward and Miami-Dade County criminal defense lawyers know that this is an incredibly complicated case and the legal defense of the students requires shifting the perspective. Instead of viewing these students as hardened criminals, might we be able to see them as victims, taken advantage of by the planners of the scheme?
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Earlier this month, a woman in Pompano Beach was arrested for allegedly using $400 in counterfeit money to purchase a pre-paid Visa card.
As our Palm Beach and Broward County criminal defense lawyers understand it, the manager at the store at which the Visa card was purchased realized that the money used for the purchase was counterfeit, and he subsequently deactivated the pre-paid card. Upon realizing that the card was no longer active, the woman returned to the store, at which point the police were called.

This case highlights a few issues that are highly relevant to criminal defense law, including the fact that seemingly criminal behavior might be unintentional and that what you say to police officers can cause you otherwise preventable harm.
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The Florida Department of Children and Families is cracking down on welfare fraud, saying theft of public-assistance dollars costs the state an estimated $1.35 billion annually.
The agency has just received grant funding from the state Department of Agriculture to implement a first-of-its-kind system to track and halt fraud in much the same way that banks and credit card companies already do.

Our Fort Lauderdale criminal defense lawyers know that these measures are primarily aimed at prevention, but they could undoubtedly be used as evidence in criminal prosecutions.

Florida Statute 414.39
governs welfare fraud in the state. It holds that any person who fails, either by false statement or by impersonation or misrepresentation or any other fraudulent means, to disclose material facts regarding the determination of a person’s qualification to receive public assistance from state or federal programs or if the person falsifies information to receive larger benefits than what they might rightly collect, is guilty of a crime.

The severity of that crime, and therefore the punishment, depends on which fund was stolen from and how much was wrongfully taken.

For example, if a person wrongfully collects food vouchers from the state with an aggregate value of $200 or less in any one-year period, it’s a first-degree misdemeanor, punishable by up to one year in jail. However, if the value of those food vouchers was more than $200 in a one-year time frame, it’s bumped up to a third-degree felony, punishable by up to five years in prison.

The fraud tracking program that Florida is gearing up to launch is going to cost the state about $1 million to $4 million annually, but it’s expected to save about $60 million just in that first year. In addition to funding from the Department of Agriculture, the state legislature pitched in about $5 million for the program, which should subsequently be able to fund itself.

A recent trial run over the course of five weeks involved establishing new hurdles to collection of food vouchers provided by the state. An online screening tool is used to pepper the recipient with a series of questions that only he or she should know. This particular device is an effort to ward off identity thieves. Of nearly 140,000 applications in the first several weeks, the Orlando office red-flagged some $210,000 in fraud – which was triple what authorities had expected to uncover.

Nowhere else in the government sector is this being done. This marks a shift in approach to the issue. Traditionally, tackling the issue of identity theft and welfare fraud had involved a method of “pay-and-chase.” The state would pay out the funds, then recognize them as fraudulent and go after the alleged thieves.

This effort follows a number of higher-profile arrests for fraud in Florida. In one case, a mental health counselor in central Florida was accused of running a $3 million Medicaid fraud operation, using the money to purchase high-end cars, expensive vacations and nearly $200,000 in designer purses.

Then recently in Manatee County, some 100 people were arrested on allegations of food stamp fraud.

Right now in Florida, 9 out of 10 welfare recipients apply for their benefits online. This has allowed the state to reduce the huge lines at welfare offices, but it has given increasing rise to identity theft.

Three years ago, the state founded the Office of Public Assistance Benefits Integrity, which accepts and investigates complaints of public assistance fraud.

Public officials say that by far, Medicaid fraud is the most common problem in this realm, with individuals often hiding income in order to meet eligibility requirements. This is followed by food stamp fraud. In many cases, people will heist the identities of those who are imprisoned or deceased to collect benefits.

Last fall, Florida officials began using software to cross-reference information from financial institutions to determine whether recipients had access to money they weren’t disclosing to the government.
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Two men suspected of involvement in an identity fraud ring were arrested by officials with the Transportation Security Administration at the Fort Lauderdale-Hollywood International Airport, after officials say the men were “acting nervous.” selfportrait1.jpg

Officials refused to say what exactly the men were doing that drew suspicion, but said they were clearly exhibiting behaviors that increase when trying to suppress high stress levels. As a result, the men were searched and TSA officials found envelopes containing numerous debit cards and lists that contained hundreds of names, birth dates and Social Security numbers.

Our Fort Lauderdale felony defense lawyers know that nervousness is almost status quo when folks encounter police officers or those who hold some position of authority. While these two may have had reason to be fearful of discovery, a display of fear alone should not be considered the sole probable cause for a search.

Of course, different rules apply to individuals who are boarding a plane versus someone on the street. Even when we are in public, we can expect a certain degree of privacy. However, individuals who enter an airport to board a plane should expect that their property and persons will be thoroughly searched as a condition of getting on the aircraft. Trained dogs also routinely patrol airport facilities in order to sniff out drugs, weapons and explosives.

When you are on the street, however, you do have the right to refuse a search. That doesn’t mean an officer won’t follow through anyway if he or she believes there is probable cause to do so, but it will give your attorney some leverage in court if that probable cause is later found to be faulty.

Nervousness displayed on the part of a person being stopped is often a key factor for police in deciding whether someone has something to hide. It’s often pointed out in arrest reports and affidavits.

Aside from the fact that perceptions of a person’s nervousness are highly subjective, the definitions of it can vary greatly among agencies and between officers. It could be sweating, fidgeting, your lack of cooperation, hands shaking or voice wavering. But again, there could be many other reasons for this (it’s hot, you have a medical condition, etc.)

An appellate court in North Carolina recently ruled that nervousness alone is not enough of a basis for officers to initiate a traffic stop. In North Carolina v. Canty, the court of appeals determined that an officer can’t determine a person’s degree of nervousness when they are traveling 65 miles per hour.

In that case, deputies set up a speed trap along the highway when a green minivan passed. The vehicle was initially traveling at 73 miles per hour in a 70 miles per hour zone, though it slowed to 65 miles per hour, presumably when the driver spotted the officer. Two officers testified that in addition, both the driver and passenger stared straight ahead and appeared nervous as they passed.

Officers stopped the van and later said that the occupants would not make eye contact. The officers would later say that the vehicle drove left of center, though dash cam video proved that account false and didn’t reveal any indication of unsafe driving.

The driver was given a warning and then consented to a search, at which time officers discovered two firearms in a suitcase that belonged to the passenger. He was then arrested and convicted for being a convicted felon in possession of a firearm.

However, that conviction was subsequently tossed because the officers’ entire basis for the stop – that the driver and passenger were “nervous” – was not something they could have judged in a vehicle that was zooming past them. Given that the defendant’s attorney never raised this issue during the first trial, the court ordered a new trial during which another attorney would likely be successful in filing a motion to suppress the evidence.

Because this case happened in North Carolina, it doesn’t have any direct effect on us here, but the same logic could be applied in a number of traffic stop arrests here in Florida.

The bottom line is it’s normal to be nervous if you are approached by an officer of the law. There is an inherent imbalance of power, with the officer having the power to ticket or even arrest you.

In general, here are some things to keep in mind the next time you encounter law enforcement:

1. Don’t talk. You may have to provide the basics: Your name, your date of birth, your license and insurance card. Beyond that, you don’t need to answer any questions. Doing so usually just makes it worse. Be polite, but firm.

2. Do not run away. This is considered the epitome of nervous behavior, and it will usually result in you facing additional charges. Follow officer instructions. Building a defense can be tougher if you run or resist arrest.

3. Don’t believe what the police are telling you. It’s legal (and common) for police to lie to you in order to get a confession. They will tell you that your friend has already confessed to your role. Simply refuse to talk until you have had the opportunity to confer with your defense attorney.

4. Don’t look in areas where you don’t want police to look. They will pick up on that glance you gave to the console or trunk. Look down and stay quiet.

5. It’s natural to be nervous. Accept that. Take a deep breath. Don’t let your nerves cause you to try to talk your way out of a situation. Let us do that for you.
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A Miami millionaire whose business model was built around providing shelter to those who had suffered disaster has been arrested by federal authorities on charges of money laundering and fraud. dollarbill.jpg

Our Broward criminal defense lawyers know that while this case is exceptional for the fact that it involved many millions of dollars and well-known, wealthy investors, we tend to see more of these type of cases than other areas of the country.


Many of those who live in Miami are not native. They are newcomers and they are often on the hunt for opportunities to generate wealth. The combination of this, according to former federal prosecutors, leaves the area ripe for fraud.

The defendant in this case was, himself, from Venezuela. He used to boast about climbing some of the world’s highest peaks. He lived in a $12 million mansion in Miami, and a mountain lodge in Colorado. He drove a Maserati. He was a country club regular. He and his wife threw glittering, extravagant parties, attended by high-level politicians and celebrities.

All of this, prosecutors say, provided the illusion that his ventures were legitimate. However, they say the truth was less solid than the ready-made disaster shelters he was attempting to market.

The defendant’s company was founded seven years ago, and was pitched to investors as an innovative way to house those who had lost their homes in the wake of a natural disaster. It involved the use of a newly-created fiber-composite panel. Each panel locked into the others, kind of like Legos. The idea was to provide an affordable form of temporary housing post-disaster in areas like Haiti and other developing countries, where people could not rely on a strong federal government to provide immediate and adequate assistance.

His investors included several NBA players and a group of wealthy businessmen from the United Arab Emirates. His board of directors included former Florida Gov. Jeb Bush. He even finagled his way into a White House meeting, where he was able to land a $10 million government loan to kick-start the disaster home business.

In all, investigators say the defendant was able to rake in $40 million in investments, primarily by deceiving investors into believing that his LLC had millions more in equity and cash.

One of those was a prominent developer and attorney, who handed over $4 million. He would later say it was the seeming stability of the company, combined with all the well-known others who were involved, that made it seem legitimate.

In truth, before the company even went public, a judge had taken away his authority to continue running the Miami Beach-based firm. Creditors, including the Swiss Bank, were knocking on his door, claiming he owed nearly $225 million in loans he was given after reportedly being dishonest about an electronics business he previously owned, which had gone bankrupt back in 2000.

Some began to suspect, however, that the model of disaster housing that the defendant was hawking simply didn’t make much sense in terms of cost-effectiveness. However, by the time many of them began to suspect something was up, investigators say, it was too late.

As of now, the company has gone bankrupt. The defendant has promised to repay creditors some $50 million, but it’s unclear whether he will be able to do so. His mansion has been auctioned off, and the formula for the disaster housing panels was sold to a company in Brazil.

Cases like these can be incredibly complicated, and require a legal team that can devote significant time and energy researching the complexities.

18 U.S.C. 1956 defines money laundering as conducting transactions with money obtained unlawfully, while representing the proceeds as being lawful. This can be done with either the intent to promote or carryout that unlawful activity, with the intent to defraud the IRS and/or state and federal authorities or knowing that the transaction is at least partially set up to conceal the nature of its source. A conviction will result in up to 20 years in prison and fines of either $500,000, or twice the value of the property involved in the transaction – whichever is more.
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Medicare fraud is a crime for which the government – especially in Florida – is cracking down hard. nurselab.jpg

In particular, our Fort Lauderdale criminal defense attorneys know that prosecutors are aggressively coming after doctors and other health care professionals with allegations of exaggerated billing, also sometimes called “upcoding.”

This was the case in U.S. v. Raul Ramirez, argued recently in the U.S. Court of Appeals for the Eleventh Circuit.

This was a case in which the executive director of a medical center in Miami was convicted federally on multiple counts of conspiracy to commit health care fraud, health care fraud and money laundering.

Ramirez’s attorneys argued upon appeal that the district court had erred when it refused to dismiss the original indictment, failed to conduct competency hearings, made a number of questionable evidentiary rulings during the trial and then also erred during the sentencing phase.

Unfortunately for Mr. Ramirez, the appellate court justices upheld the original conviction.

That conviction was in large part due to testimony from lab technicians who testified that it appeared patient blood samples had been manipulated in order to show a decreased blood platelet count that would justify billing Medicare for costly prescription medications.

Apparently, the blood samples that were submitted by Ramirez’s company were markedly different than those submitted by different health care professionals on those same patients. In one case, a neighboring location found that a patient’s blood platelet level was at 198,000, which would be a normal level. But a week later, that same patient was tested at Ramirez’s facility, and showed a precariously low platelet level of 47,000.

Having not personally worked on this case, our Fort Lauderdale criminal defense lawyers can’t say with any certainty whether this defendant was indeed guilty of the fraud for which he was accused. However, we do know that the majority of these cases originate from the issue of over-billing.

The New York Times recently conducted an in-depth analysis on the issue. The article indicates that while Medicare fraud is real and a serious problem, many of these billing errors may actually be the result of electronic billing.

In fact, this is the same billing system for which the federal government provided big incentives to hospitals and doctors’ offices that updated their records from paper form to electronic. The government had maintained that keeping such records resulted in a reduction of fraud.

However, the New York Times’ analysis, based on a new report by the Inspector General’s Office, indicates that variances in the new coding system may result in potential errors. These errors, the Times reports, have led to billions of dollars in overage charges across the country.

Again, we’re not saying that Medicare fraud doesn’t exist. Clearly, it does. But there may be more than one explanation for why a physician may be overcharging, and it may not even be something they are aware is happening.

Medicare fraud is an offense that carries very serious penalties. In Ramirez’s case, it resulted in a 10-year prison term, followed by an additional 7.5 years for money laundering.

These are cases that require experienced legal professionals with proven success.
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Fort Lauderdale fraud defense, particularly for high-level Ponzi schemes, require skill and experience.moneyseries12.jpg

A Broward defense attorney should have a proven success record for cases involving white collar crimes and offenses involving extensive paper trails and financial records.

That’s what’s going to be required for a local investment adviser and several of those working with him. Prosecutors contend that he spearheaded an effort to gain the trust of the gay community in Wilton Manors. By exploiting that trust, prosecutors say he perpetuated a multimillion dollar investment fraud.

There are about 14 residents from Broward who say they were victims of the $2.5 million scheme. Victims contend they trusted the man, who was vouched for by a well-known area resident and his daughter. The defendant is now locked up awaiting trial for federal charges of wire fraud. In the meantime, the investors have also reportedly filed a civil lawsuit. Others across the country have filed similar lawsuits, including a California family alleging a loss of $4 million. Additionally, the SEC has filed a lawsuit in civil court against him, saying he raised an estimated $11 million by lying and submitting phony financial statements.

Those representing the alleged victims say that the losses have completely wiped out life savings and that they were victimized by people they believed were their friends.

However, what’s important to note is that sometimes investments go bad. Just because a venture doesn’t work out doesn’t mean someone is criminally liable.

After it became clear to the defendant that charges may be filed, he reportedly fled to Cyprus, a Mediterranean island where he was born. That was back in January, and it was believed that he would be out of reach of federal authorities there. However, he returned to the U.S. — visiting Las Vegas in March. Authorities with the FBI were waiting for him when he landed.

With regard to the man’s dealings in the Walton Manors community, it’s alleged that his friend and his friend’s daughter introduced him to the gay community there by ingratiating him into the nightlife scene. The daughter also reportedly worked as the manager of property at the Wilton Station development. At least four of the alleged victims lived there.

It’s alleged that the father-daughter pair told false stories to the investors of the riches they were able to afford due to the investments they made with the defendant. This, say prosecutors, gave the alleged victims confidence in a man they had only just met.

However, the man and his daughter say they were victims of the defendants as well.

The civil lawsuits say that the defendant and father-daughter pair would wine and dine potential investors at a local fancy restaurant. That’s where the defendant would give his sales pitch.

Prosecutors say it wasn’t until much later that the investors realized they had been defrauded.

Of course, there are a lot of details in this case that we don’t yet know, such as what the alleged victims believed they were investing in and how that all began to unravel.

It’s a case our Fort Lauderdale fraud defense attorneys will be watching closely.
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Authorities recently announced the arrest of more than 100 people on charges of West Palm Beach Medicare fraud. doctor.jpg

Our West Palm Beach defense attorneys understand that arrests were made all over the state, though nearly 60 of them were in South Florida. The total cost of the estimated losses topped an eye-popping $450 million across seven cities.

All of the Medicare fraud suspects are being prosecuted in federal court. The Florida Attorney General’s Office has a Medicaid Fraud Control Unit, which has been operational since 1994. Florida Attorney General Pam Bondi has been quoted as saying that the most common Medicaid and Medicare fraud operations in Florida have to do with health care providers – dentists, clinics and doctors – billing or over-billing the government-funded social health care service for products, tests or services that either aren’t necessary or were never performed.

An example might be what is called a “phantom bill,” which is when a doctor may bill for a service that never happened, or “up-coding,” which is when a doctor bills more for a test or service than it’s worth. This would also include cases in which health care providers conduct a far more expensive test than what’s necessary, when a cheaper test will suffice.

While these cases can be prosecuted at the state level, they can also be prosecuted federally as well. The first press briefing for this operation, for example, was held in Washington by officials with the U.S. Justice Department.

Medicare, which is a federally-subsidized program used to provide care for seniors, elderly and disabled, reportedly pays out billions of dollars annually in fraudulent claims. South Florida, namely Broward and West Palm Beach, have a reputation for being active hubs of this crime.

Some of the examples of those arrested included:

-Nine people at a number of mental illness clinics who allegedly submitted phony bills between 2004 and 2011. The bills were sent for group therapy sessions that either were never offered or would not have benefited the patients, some of whom suffered from dementia or Alzheimer’s disease, according to the government.

-A former social worker who allegedly assisted those without citizenship in the U.S. to fill out forms saying they had a mental illness so they could avoid taking the citizenship test.

-Owners of medical clinics in Miami-Dade and St. Lucie counties who reportedly charged for HIV therapies and services that they either didn’t provide or weren’t beneficial.

-Sixteen people who worked for a home health care company, who reportedly accepted kickbacks from recruiters and patients.

These are serious charges, which could result in lengthy prison sentences, revocation of health care and medical licenses and an irreparably damaged reputation. That’s why it’s so important for individuals who are charged with Medicare fraud in West Palm Beach to contact a law firm with experience in handling West Palm Beach fraud cases.
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