First Coronavirus-Related Charges Brought by Federal Prosecutors
As discussed in last week’s post, Attorney General William Barr issued a March 16th memo directing all Department of Justice prosecutors to prioritize the detection, investigation and prosecution of Coronavirus-related fraudulent conduct. Federal prosecutors have swiftly responded to the directives of AG Barr commencing criminal six prosecutions in four different districts.
- On March 25th, the United States Attorney’s Office for the Central District of California arrested actor Keith Lawrence Middlebrook alleging he solicited investments in a company he claimed would be used to market pills that would prevent Coronavirus infections and an injectable cure for those already suffering from COVID-19. Middlebrook posted videos on social media of non-descript while pills and a liquid injection he claimed would offer immunity and a cure, respectively.
- On March 26th, the United States Attorney’s Office for the District of New Jersey arrested Erik Santos for his alleged role in a conspiracy to defraud federally funded and private health care benefit programs by submitting fraudulent testing claims for COVID-19 and genetic cancer screenings. Prosecutors allege Santos’ scheme aimed to submit more than $1.1 million in fraudulent Medicare claims. Santos has been charged with conspiring to violate the Anti-Kickback Statute and conspiring to commit healthcare fraud.
- On March 30th, the United States Attorney’s Office for the District of New Jersey commenced its second coronavirus-related prosecution after arresting Baruch Feldheim for allegedly coughing on FBI agents while claiming he was infected with COVID-19 and lying to the FBI about his accumulation and sale of surgical masks and other medical supplies. Feldheim stored the accumulated medical supplies at his Brooklyn, New York home and in a New Jersey repair shop. Prosecutors indicated Feldheim accumulated enough materials to outfit an entire hospital – 192,000 N95 respirator masks, 598,000 medical-grade gloves, 130,000 surgical and other masks, surgical gowns, disinfectant towels, and various sanitizers and spray disinfectants. Feldheim is also alleged to have engaged in efforts to resell the medical supplies to doctors at a 700% markup.
- On April 1st, the United States Attorney’s Office for the Central District of California commenced its second coronavirus-related prosecution. British national Frank Ludlow has been named in a federal criminal complaint alleging he smuggled mislabeled drugs into the United States purporting to be a COVID-19 treatment. Ludlow was charged with introducing misbranded drugs into interstate commerce. Ludlow allegedly smuggled kits from the United Kingdom to the United States by shipping mislabeled parcels to individuals in Utah and California.
- On April 8th, the United States Attorney’s Office for the Western District of Texas filed charges against Christopher Charles Perez for allegedly perpetrating a COVID-19-related hoax. Perez was charged with one count of violating 18 U.S.C. § 1038, which criminalizes false information and hoaxes related to weapons of mass destruction. According to the criminal complaint, Perez posted a threat on Facebook claiming to have paid someone to spread coronavirus at grocery stores in the San Antonio area.
- On April 9th, the United States Attorney's Office for the Northern District of Georgia arrested a Georgia resident, Rong Sun, for allegedly smuggling an illegal pesticide into the United States and attempting to sell it on the internet claiming it protected against COVID-19. Sun allegedly sold Toamit Virus Shut Out, an unregistered pesticide, through eBay, marketing the pesticide as “Virus Shut Out” and “Stop The Virus”.
Flannery | Georgalis will continue to provide updates as federal prosecutors continue to identify and aggressively prosecute those who attempt to benefit from the coronavirus pandemic.