New Santa Ana | Category Archives: California Department of Justice

Santa Ana pharmacy owner gets 3 years in prison for $1.8 million insurance scheme

Posted on August 30, 2021 by Editor Posted in California, California Department of Justice, Crime, Drugs, Insurance, Santa Ana Leave a comment

OAKLAND – California Attorney General Rob Bonta today announced the sentencing of Quality Care Pharmacy owner Divina Catalasan for defrauding the Medi-Cal and Medicare programs. An audit by the California Department of Justice (DOJ) found that the amount of drugs the owner of the Santa Ana-based pharmacy claimed to have purchased and billed the programs for was not supported by her actual inventory, and that her fraudulent over-billing totaled more than $1.8 million. Catalasan pleaded guilty on May 14, 2021, to three felony counts of fraudulent healthcare claims and grand theft, with a sentencing enhancement for aggravated white-collar crime. She was sentenced today in Orange County Superior Court to three years in state prison.

“Medi-Cal and Medicare bring healthcare to seniors and people in need, including underserved children and people with disabilities. People who defraud these publicly-funded programs cheat all of us,” said Attorney General Bonta. “Through our Division of Medi-Cal Fraud and Elder Abuse, the California Department of Justice works to protect Californians from healthcare fraud. People who try to pull a fast one on these programs will be held accountable.”

In 2015, an audit of Quality Care Pharmacy by the California Department of Health Care Services revealed that from 2011 through 2015, Catalasan billed Medi-Cal more than $540,000 over what her purchase inventory showed. The department then referred the case to DOJ’s Division of Medi-Cal Fraud and Elder Abuse (DMFEA), which expanded the audit and the time frame under review. DMFEA also expanded its audit beyond Medi-Cal to Medicare and Orange County’s Medi-Cal managed care plan, CalOptima. The expanded audit found that Catalasan fraudulently overbilled Medi-Cal and CalOptima for $1,168,585.06, and Medicare for $687,940.52, for a total of $1,856,525.58. She was arrested on June 11, 2019.

Through the DMFEA, DOJ works to protect Californians by investigating and prosecuting those who perpetrate fraud on the Medi-Cal program. DMFEA also investigates and prosecutes those responsible for abuse, neglect, and fraud committed against elderly and dependent adults. The division regularly works with whistleblowers and law enforcement agencies to investigate and prosecute crimes.

The DMFEA receives 75% of its funding from the U.S. Department of Health and Human Services under a grant award totaling $41,264,032 for federal fiscal year 2020-2021. The remaining 25%, totaling $13,754,675 for fiscal year 2020-2021, is funded by the State of California. The federal fiscal year is defined as through September 30, 2021.

A copy of the complaint is available here.

O.C. insurance agents arrested in $4 million securities fraud scheme

Posted on December 1, 2020 by Editor Posted in California, California Department of Justice, Crime, Insurance Leave a comment

ORANGE, Calif. — Robert Andrew Lotter, 63, of Newport Beach, and Charles Albert Major, 72, of Irvine, were arrested today on multiple felony counts of securities violations and burglary after allegedly defrauding more than 20 victims of over $4 million.

An investigation by the California Department of Insurance alleges that between 2003 and 2018, Lotter and Major fraudulently solicited and sold victims more than $4 million in stock certificates in Lotter’s companies, eAgency, Inc. and Mymobilewatchdog, Inc.

Lotter owns an insurance agency, R.A. Lotter Insurance Marketing, Inc., and Major is a licensed insurance agent. Lotter and Major contacted clients of R.A. Lotter Insurance Marketing and used various schemes to fraudulently obtain victims’ private financial information in order to identify potential investors for Lotter’s high-risk investments.

Lotter’s insurance agency led several victims to believe the agency was authorized or affiliated with the California State Teacher’s Retirement System (CalSTRS) that provides retirement pension advice to California public school educators. Some victims did not discover it was not authorized or affiliated with CalSTRS until after they had invested substantial funds in eAgency, Inc. and Mymobilewatchdog, Inc.

“Even though these insurance agents had a fiduciary responsibility to represent their clients’ best interest, they allegedly put greed above their clients’ needs,” said Insurance Commissioner Ricardo Lara. “Their arrest shows the Department of Insurance will persist in investigating and stopping insurance professionals who put their clients at financial risk.”

Between 2003 and 2018, Lotter and Major continued to lure victims with assurances that profits from eAgency, Inc. and Mymobilewatchdog, Inc. were “just around the corner.” They claimed to have partnerships with large internet companies and prominent mobile carriers. They showed clients newspaper articles and televised interviews featuring Lotter to cement victims’ confidence in their investments and mitigate concerns victims had about their investments and the continued delays of their investment returns.

Lotter’s companies, eAgency, Inc. and Mymobilewatchdog, Inc., had poor financial statuses including unpaid financial obligations to prior investors. Lotter and Major did not make their clients aware of the poor financial statuses of the companies and they did not notify victims when the alleged lucrative partnerships fell through. Victims were led to believe their investments in eAgency, Inc. and Mymobilewatchdog, Inc. were still viable.

Lotter and Major were booked into Orange County Jail. Bail was set at $4 million for Lotter and $2 million for Major. This case is being prosecuted by the Major Fraud Unit of the Orange County District Attorney’s office. The Department is also taking the appropriate administrative action against the licensees and the various insurance agencies they managed.

O.C. security guard arrested for pretending to be a Federal agent

Posted on August 25, 2020 by Editor Posted in California Department of Justice, Crime, Federal Government, Justice, Orange County, Santa Ana 1 Comment

SANTA ANA, California – A private security employee at an Orange County retirement community was arrested today on a criminal complaint alleging he pretended to be a federal agent.

Donovan Pham Nguyen, 34, of Riverside, is charged with one count of false impersonation of a federal officer or employee, according to a criminal complaint unsealed today. He is scheduled to make his initial appearance this afternoon in United States District Court in Santa Ana.

According to an affidavit filed with the complaint, Nguyen for years pretended to be a special agent with Homeland Security Investigations (HSI) and used the false title to obtain things of value. Nguyen never worked for HSI, although he previously was a privately contracted security guard at a Department of Homeland Security (DHS) facility. He left that job in 2015 after an internal investigation was launched resulting from allegations that he printed fake HSI identification documents, the affidavit states.

In May 2019, while employed for a private security company at a retirement community in Orange County, Nguyen allegedly claimed his false title to agents with the U.S. Department of State’s Diplomatic Security Service (DSS) preparing to execute an arrest warrant.

In June 2020, Nguyen discussed a potential criminal investigation with members of the Riverside County District Attorney’s Office after an introduction from a mutual friend. At the meeting, Nguyen again purported to be an HSI employee, according to the affidavit. Following the meeting, Nguyen informed the District Attorney’s Office that, after discussing the matter with his supervisor, HSI could not assist the district attorney in the investigation.

Nguyen allegedly used a false DHS identification to purchase firearms, which allowed him to avoid taking and paying for certain firearm safety courses required by California law. He also used his purported duties as an HSI special agent to excuse his frequent absences from work at a private security firm.

His coworkers at the private security firm reported seeing an HSI badge, a DHS plaque, and various tactical gear, including a ballistic shield, inside of Nguyen’s office. They also reported that Nguyen’s personal vehicle had been equipped with red and blue lights and a siren, the affidavit states. Nguyen also handed out HSI memorabilia, mugs and coins to people at that office.

Nguyen’s LinkedIn social media profile posted his current employment as “Department of Homeland Security Agent,” indicating he was employed with DHS since June 2008. Nguyen also appeared in a YouTube video that purports to be an interview of him as a long-time HSI special agent discussing immigration policies, according to the affidavit.

A complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

If convicted, Nguyen would face a statutory maximum sentence of three years in federal prison.

Homeland Security Investigations and U.S. Immigration and Customs Enforcement’s Office of Professional Responsibility investigated this matter. These DHS agencies received assistance from the Riverside County District Attorney’s Office, the U.S. Department of State’s Diplomatic Security Service, and the Orange Police Department.

This case is being prosecuted by Assistant United States Attorneys John A. Balla and Jerry C. Yang of the Riverside Branch Office.

Two new defendants charged in the fatal kidnapping of a Santa Ana car dealer

Posted on July 17, 2020 by Editor Posted in California Department of Justice, Chinese, Crime, Federal Government, Justice, Los Angeles County, Santa Ana Leave a comment

LOS ANGELES – Two men from the San Gabriel Valley were charged today in federal court for allegedly participating in the kidnapping of Ruochen “Tony” Liao, a Chinese national (who was a car dealer in Santa Ana) who was violently abducted from a mall parking lot in San Gabriel two years ago, and whose parents were extorted for $2 million in ransom before Liao died from his injuries.

Anthony Valladares, 28, of Pasadena, and Alexis Ivan Romero Velez, 24, most recently a resident of Azusa, were taken into custody Tuesday during the execution of search warrants by FBI agents and members of the San Gabriel Valley Safe Street Task Force. Federal prosecutors this morning filed a criminal complaint in United States District Court that charges both Valladares and Romero with one count of kidnapping.

Previously in this investigation, two Chinese nationals were charged in a four-count indictment alleging they kidnapped Mr. Liao and attempted to collect $2 million in ransom from Mr. Liao’s family in exchange for the victim’s life. Guangyao Yang, 26, and Peicheng Shen, 34, whose last known U.S. residences were in West Covina, were charged with conspiracy to kidnap, kidnapping, attempted extortion in violation of the Hobbs Act, and threat by foreign communication. Yang and Shen are currently in custody in China on charges filed there related to the kidnapping.

During the investigation, the FBI learned that Valladares and Romero worked with Yang and Shen to conduct the kidnapping, during which Liao was repeatedly beaten and tased into submission, according to the affidavit in support of the complaint. Valladares was the “muscle” hired to intimidate, beat and subdue Liao during the kidnapping, and Romero was the driver of the vehicle used in the kidnapping, according to the affidavit.

Valladares and Romero were arrested Tuesday after making statements about their roles in the kidnapping to investigators. According to the affidavit, Valladares admitted that he was hired to assist in the kidnapping, agreed to accept $1,000 for the job, and restrained Liao during the kidnapping. Romero admitted, according to the affidavit, that he was recruited by Valladares and was the driver during the kidnapping.

After Liao was kidnapped on July 16, 2018, his parents in China received ransom demands and “proof-of-life” photos suggesting that Liao had been badly beaten, blindfolded, and tied up with duct tape. Liao’s parents were told to deposit the ransom payment into Chinese bank accounts within three hours, according to court documents.

Investigators believe Liao was held captive in a closet at a residence in Corona. During his captivity, investigators believe Liao was frequently beaten and ultimately died the night of July 17. During the early morning of July 18, investigators believe Yang and Shen drove to the desert near the town of Mojave to bury Liao’s body.

On July 26, 2019, the FBI laboratory used DNA testing to identify Liao’s remains, which were recovered following a search by the FBI’s Evidence Response Team.

Valladares and Romero are expected to make an initial appearance in U.S. District Court in Los Angeles this afternoon.

A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

The kidnapping charge carries a statutory maximum penalty of life in federal prison.

The investigation into the kidnapping is being conducted by the Federal Bureau of Investigation, with significant assistance by members of the FBI’s Safe Street Task Force, which includes the Pasadena Police Department.

This case is being prosecuted by Assistant United States Attorneys Julia Choe of the Cyber and Intellectual Property Crimes Section and Frances Lewis of the Public Corruption and Civil Rights Section.