Criminal Justice News

Tuesday, September 17, 2019

52nd Defendant Arrested and Charged in College Admissions Case

Defendant was arrested in Spain last evening as government seeks extradition

BOSTON – Spanish authorities arrested a Chinese woman last night in connection with her role in using bribery and other forms of fraud to facilitate her son’s admission to the University of California at Los Angeles (UCLA) as a purported soccer recruit.

Xiaoning Sui, 48, of Surrey, British Columbia, Canada, was arrested in Spain and charged in an indictment unsealed today in federal court in Boston with one count of conspiracy to commit mail fraud and honest services mail fraud. Sui is currently detained in Spain, and authorities will seek her extradition to Boston to face charges.

According to the indictment, Sui agreed with William “Rick” Singer to pay $400,000 to facilitate her son’s admission to UCLA as a purported soccer recruit. It is alleged that during a phone call in August 2018, Singer explained that Sui’s son could be “guaranteed” admission to UCLA, in exchange for $400,000. Between August and October 2018, Sui allegedly provided Singer with her son’s transcript and photographs of her son playing tennis. Co-conspirator Laura Janke then fabricated a soccer profile for Sui’s son, which described him as a top player for two private soccer clubs in Canada. On Oct. 24, 2018, Singer instructed Sui to wire Singer $100,000 which would be “paid to the coach at UCLA” in exchange for a letter of intent from the UCLA soccer coach. Two days later, Sui allegedly wired $100,000 to a bank account in Massachusetts in the name of Singer’s sham charitable organization, the Key Worldwide Foundation (KWF). On Nov. 5, 2018, UCLA admitted Sui’s son as a recruited soccer player, and awarded him a 25% scholarship. In February 2018, Sui allegedly wired an additional $300,000 to the KWF account as final payment for her son’s fraudulent admission to UCLA.

Janke previously pleaded guilty and is cooperating with the government’s investigation.

Case information, including the status of each defendant, charging documents and plea agreements are available here:

The charge of conspiracy to commit mail fraud and honest services mail fraud provides for a maximum sentence of 20 years in prison, three years of supervised release, and a fine of $250,000 or twice the gross gain or loss, whichever is greater. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston, made the announcement today. Assistant U.S. Attorneys Eric S. Rosen, Justin D. O’Connell, Leslie A. Wright, and Kristen A. Kearney of Lelling’s Securities and Financial Fraud Unit are prosecuting the cases.

The details contained in the court documents are allegations and the remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Caddo Parish mental health counseling firm owner and supervisor indicted for billing nearly $8 million for services not provided, paying kickbacks

SHREVEPORT, La. – United States Attorney David C. Joseph announced that two Northwest Louisiana residents who owned and ran the Positive Change Counseling Agency LLC were indicted for improperly billing Medicaid for almost $8 million, in addition to paying kickbacks in violation of the law.

The owner and operator of Positive Change, Marty Johnson, 57, of Shreveport, and the company’s supervisor and business manager, Keesha Dinkins, 42, of Bossier City, Louisiana, were charged with one count of conspiracy to commit health care fraud and wire fraud, 47 counts of health care fraud and four counts of wire fraud.  Johnson also faces one count of paying a kickback.

According to the indictment, Positive Change billed Medicaid $7,992,347 for psychiatric therapy, transportation, and other related mental health services from January 2014 to December 2018 that were never provided.  In order to execute the scheme, Johnson and his employees recruited clients to receive mental health and related services.  Johnson then paid some of these clients kickbacks in exchange for enrolling in certain programs.  Johnson also obtained Medicaid identification numbers from potential clients and their family members and, without the potential clients’ authorization, billed Medicaid for services that were not rendered.

In billing Medicaid, Johnson and Dinkins: (i) created false documents showing that Positive Change provided services that were not rendered; (ii) falsely listed employees with graduate and advanced educational degrees as service providers in order to trigger a higher rate of payment from Medicaid; and (iii) used false, fabricated and exaggerated mental health diagnoses in order to obtain additional payments from Medicaid.

If convicted, the defendants face up to 20 years in prison for each count of conspiracy, health care fraud and wire fraud.  Johnson also faces 10 years in prison for illegal kickbacks.  Both defendants also faces up to five years of supervised release, a $250,000 fine, forfeiture and restitution. Arraignment is scheduled for September 10, 2019.

The U.S. Department of Health and Human Services, Office of Inspector General; the FBI; and the Louisiana Attorney General’s Office, Medicaid Fraud Control Unit, conducted the investigation.  Assistant U.S. Attorney Earl M. Campbell and Cadesby Cooper are prosecuting the case.

An indictment is merely an accusation and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

Cupertino Man Convicted Of Embezzling More Than $7.5 Million In Donated Funds

Jonathan Chang misappropriated religious donations and church funds

SAN JOSE - A federal jury convicted Jonathan Chang of four counts of wire fraud and three counts of money laundering, announced United States Attorney David L. Anderson and Federal Bureau of Investigation Special Agent in Charge John F. Bennett.  The verdict follows a four-week trial before the Honorable Edward J. Davila, United States District Judge. 

The evidence at trial demonstrated that Jonathan Chang, 63, of Cupertino, Calif., engaged in a scheme to defraud a wealthy donor of money intended to support the Home of Christ 4 Christian Church (HOC4), located in Saratoga, Calif.  Chang, who served as an “elder” responsible for managing the finances of the church, furthered his scheme by establishing charitable organizations with names similar to the church. He then directed more than $6 million from the donor to his own organizations rather than to the HOC4.  In addition, Chang embezzled approximately $900,000 from HOC4-related bank accounts in his scheme to defraud.

The jury concluded that Chang solicited funds from the wealthy donor for the stated purpose of acquiring a new HOC4 building (church house) and purported missionary work.  In response to Chang’s requests, the donor provided $2.25 million in one-time donations, a $3 million loan to acquire the new building, and approximately $1.5 million total in monthly donations.  Chang did not use the funds as directed and authorized by the donor.  Instead, he commonly used the funds for personal enrichment.  For example, Chang used the funds to buy a number of houses in the Bay Area, purchase luxury vehicles, obtain 15 timeshare interests, invest in commercial real estate, and pay for his health insurance and athletic club dues.  The evidence also showed that Chang purchased a home in Fremont with the donor’s funds and then leased the house to one of the donor’s companies, thereby collecting rent on a house that was purchased with funds the donor earmarked for religious purposes.  Similarly, Chang purchased another home with donor funds that were designated for religious purposes, but ultimately rented the home to one of his children.  In total, between 2004 and January 2016, Chang obtained more than $7.5 million in funds from the donor and HOC4.

Chang also concealed the proceeds of his scheme to defraud by committing money laundering.  The evidence at trial demonstrated Chang created fraudulent entities to conceal the wire fraud scheme and forwarded the funds to a variety of other bank accounts he controlled before spending the money on personal purchases.

On February 4, 2016, a federal grand jury indicted Chang and his wife, Grace Chang, 60, charging each with one count of conspiracy to commit wire or mail fraud, in violation of 18 U.S.C. § 1349; four counts of wire fraud, in violation of 18 U.S.C. § 1343; one count of conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h); and three counts of money laundering, in violation of 21 U.S.C. § 1956(a).  The jury found Jonathan Chang guilty of all the wire fraud and money laundering counts.  The jury did not reach a verdict as to the two charged conspiracy counts, nor did the jury reach a verdict as to the counts filed against Grace Chang.

Jonathan Chang faces a maximum sentence of 20 years imprisonment and a fine of $250,000 for each violation of 18 U.S.C. § 1343.  He also face a maximum of 20 years imprisonment and fine of $500,000 or twice the value of the laundered funds, whichever is greater, for each violation of 18 U.S.C. § 1956(a)(1)(B). Additional periods of supervised release, fines and restitution may apply.  However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.

Jonathan and Grace Chang are scheduled to appear before Judge Davila on September 17, 2019 for a status conference.

Assistant U.S. Attorneys Patrick R. Delahunty and Sarah E. Griswold are prosecuting the case with the assistance of Susan Kreider. The prosecution is the result of an investigation by the FBI.