Department of Justice
Office of Public Affairs
FOR IMMEDIATE RELEASE
Thursday, November 19, 2009
Twenty-six Charged in Nationwide Scheme to Defraud the FCC’s Video Relay
Service Program
Arrests Made in Nine States
Indictments were unsealed today against 26 people charged with engaging in a
scheme to steal millions of dollars from the Federal Communications
Commission’s (FCC) Video Relay Service (VRS) program, announced Assistant
Attorney General Lanny A. Breuer of the Criminal Division, Assistant
Director of the FBI’s Washington Field Office Joseph Persichini Jr., Deputy
Chief Postal Inspector Zane Hill, and FCC Chief of Staff Edward Lazarus.
Arrests were made today by FBI agents and Postal Inspectors in New York, New
Jersey, Florida, Texas, Pennsylvania, Arizona, Nevada, Oregon and Maryland,
and were the result of a joint FBI, U.S. Postal Inspection Service (USPIS)
and FCC Office of Inspector General (FCC-OIG) investigation into a
nationwide scheme to defraud the FCC’s VRS program.
“The individuals charged in connection with today’s operation are alleged to
have stolen tens of millions of dollars from an important government program
that is intended to help deaf and hard-of-hearing Americans communicate with
hearing persons,” said Assistant Attorney General of the Criminal Division
Lanny A. Breuer. “These defendants are alleged to have generated fraudulent
call minutes by making it appear that deaf Americans were engaging in
legitimate calls with hearing persons, when in reality, the defendants were
simply attempting to steal money from an FCC program that is funded by every
single American who pays their telephone bills. The Department of Justice
will not stand by and let corporate executives and others line their pockets
with money that should be used to help deaf Americans.”
“Unfortunately, this remarkable service, designed to help those in need,
also provided a growth opportunity for criminal activity that we believe has
cost American consumers tens of millions of dollars,” said Joseph
Persichini, Jr., Assistant Director of the FBI’s Washington Field Office.
“When the U.S. Mail is used for the purposes of committing fraud, and in
this case, a particularly insidious type of fraud, it’s the job of the
Postal Inspection Service to aggressively investigate and ensure America’s
confidence in the integrity of its postal system,” said Deputy Chief Postal
Inspector Zane M. Hill.
“Today’s events represent both a tragedy and an opportunity,” said FCC Chief
of Staff Edward Lazarus. “The tragedy is the unfortunate truth that a
significant number of unscrupulous individuals, at great cost to the nation,
have preyed on a very important program for delivering essential
telecommunications services to persons with hearing disabilities. The
‘opportunity’ is the chance to reiterate our commitment to the VRS program
and to follow through on efforts, already begun at the FCC, to safeguard the
program against further waste, fraud, and abuse and to improve its delivery
of VRS services to consumers.”
The indictments allege that 26 individuals engaged in a scheme to defraud
the FCC by submitting false and fraudulent claims for VRS calls, causing the
FCC to reimburse the defendants at a rate of approximately $390 per hour.
According to the indictments, VRS is an online video translation service
that allows people with hearing disabilities to communicate with hearing
individuals through the use of interpreters and Web cameras. A person with a
hearing disability who wants to communicate with a hearing person can do so
by contacting a VRS provider through an audio and video Internet connection.
The VRS provider, in turn, employs a video interpreter to view and interpret
the hearing disabled person’s signed conversation and relay the signed
conversation orally to a hearing person. VRS is funded by fees assessed by
telecommunications providers to telephone customers, and is provided at no
cost to the VRS user.
The indictments charge owners and employees of the following seven
companies with engaging in a scheme to defraud the FCC’s VRS program
* Viable Communications Inc., of Rockville, Md.;
* Master Communications LLC, of Las Vegas;
* KL Communications LLC, of Phoenix;
* Mascom LLC of Austin, Texas;
* Deaf and Hard-of-Hearing Interpreting Services Inc. (DHIS), of New
York and New Jersey;
* Innovative Communication Services for the Deaf Corp. (ICSD), of Miami
Lakes, Fla.; and
* Deaf Studio 29 of Huntington Beach, Calif.
Each of the indictments alleges that the defendants made, caused others to
make, or processed fraudulent VRS calls that were then submitted to the FCC
for reimbursement. These calls, often referred to as “r calls,” “rest calls”
or “run calls,” served no purpose other than to generate call minutes that
would be billed to the FCC’s VRS Fund.
In the first indictment, Viable Communications Inc. and four Viable
executives have been charged with fraudulently generating VRS call minutes
and obtaining reimbursements from the FCC for those calls. Viable owner and
CEO John Yeh, 62, of Potomac, Md.; Viable Chief Operating Officer Joseph
Yeh, 64, of Potomac; Viable Assistant Vice President Anthony Mowl, 25, of
Rockville, Md.; and Viable Human Relations Director Donald Tropp, 25, of
Rockville, have been charged in a six-count indictment with conspiracy to
defraud the U.S. government and to submit false claims; submitting false
claims; conspiracy to commit mail fraud; and mail fraud.
In the second indictment, Master Communications, KL Communications and
Mascom owners and employees have been charged with generating fraudulent VRS
minutes. According to the indictment, these companies operated VRS call
centers for Viable that generated and processed a large volume of fraudulent
VRS calls, which were then submitted to the FCC’s TRS Fund Administrator for
reimbursement. Master Communications, KL Communications and Mascom owner and
employee Kim E. Hawkins, 46, of Las Vegas; Master Communications employee
and KL Communications owner and employee Larry Berke, 62, of Phoenix; KL
Communications employee Dary Berke of Phoenix; KL Communications and Master
Communications employee Lisa Goetz, 43, of Phoenix; and Mascom Marketing and
Advertising Director David Simmons, 43, of Austin; have been charged in a
six-count indictment with conspiracy to defraud the U.S. government and to
submit false claims; submitting false claims; conspiracy to commit mail
fraud; and mail fraud.
In the third indictment, DHIS owners and employees have been charged with
generating and processing a large volume of fraudulent VRS calls. According
to the indictment, DHIS operated VRS call centers for Viable that generated
and processed fraudulent VRS calls. DHIS co-owners Irma Azrelyant, 47, of
Basking Ridge, N.J., and Joshua Finkle, 41, of New York; DHIS video
interpreter Natan Zfati, 31, of Brooklyn, N.Y.; DHIS bookkeeper Oksana
Strusa, 35, of Jersey City, N.J.; DHIS video interpreter Alfia Iskandarova,
29, of Brooklyn; and DHIS video interpreter Hennadii Holovkin, 36, of
Philadelphia; have been charged in a six-count indictment with conspiracy to
defraud the U.S. government and to submit false claims; submitting false
claims; conspiracy to commit mail fraud; and mail fraud.
In the fourth indictment, ICSD owners and employees have been charged with
generating and processing a large volume of fraudulent VRS calls. According
to the indictment, ICSD operated VRS call centers for Viable that generated
and processed a large number of fraudulent VRS calls. The indictment also
alleges that ICSD owners and employees engaged in sham “marketing calls” for
the stated purpose of marketing VRS services, but for the alleged true
purpose of fraudulently generating additional VRS minutes. ICSD co-owners
Yosbel Buscaron, 25, and Lazaro Fernandez, 35, both of Hialeah, Fla.; ICSD
call center manager Wanda Hutchinson, 35, of Pembroke Pines, Fla.; ICSD call
center manager Jessica Bacallo, 23, of Miami; and ICSD marketing manager
Kathleen Valle, 23, of Miami; have been charged in a six-count indictment
with conspiracy to defraud the U.S. government and to submit false claims;
submitting false claims; conspiracy to commit mail fraud; and mail fraud.
In the fifth indictment, defendants Benjamin Pena, Robert Z. Rubeck and
Tamara Frankel have been charged with generating fraudulent VRS calls.
According to that indictment, Pena was allegedly paid by Viable owner and
CEO John Yeh to generate fraudulent VRS minutes. Also according to the
indictment, Pena allegedly paid Rubeck and Frankel to make VRS calls for the
purpose of generating those fraudulent minutes. Pena, 34, of Scottsdale,
Ariz.; Rubeck, 34, of Surprise, Ariz.; and Frankel, 28, also of Surprise;
have been charged in the six-count indictment with conspiracy to defraud the
U.S. government and to submit false claims; submitting false claims;
conspiracy to commit mail fraud; and mail fraud.
Deaf Studio 29 owners and employees have been charged in a sixth indictment
with generating fraudulent VRS calls. According to the indictment, Marc
Velasquez Verson, Ellen Thompson and Doris Martinez allegedly organized and
paid employees to use a particular VRS provider to make run calls. That
provider would pay the defendants approximately 20 to 25 percent of the
money the provider received from the FCC for the calls generated by the
defendants. Velasquez, 56, of Oswego, Ore.; Ellen Thompson, 43, of Lake
Oswego, Ore.; and Doris Martinez, 51, also of Oswego; were charged in the
six-count indictment with conspiracy to defraud the U.S. government and to
submit false claims; submitting false claims; conspiracy to commit wire
fraud; and wire fraud.
All of the indictments seek criminal forfeiture from each of the charged
defendants.
An indictment is merely an accusation, and defendants are presumed innocent
unless proven guilty.
These cases are being prosecuted by Assistant Chief Hank Bond Walther and
Trial Attorney Brigham Cannon of the Criminal Division’s Fraud Section, with
the investigative assistance of the FBI’s Washington Field Office, USPIS and
FCC-OIG.
Source: http://www.justice.gov/opa/pr/2009/November/09-crm-1258.html