• Feds charge 89 people, including doctors, nurses, with Medicare fraud

    J. Scott Applewhite / AP

    Attorney General Eric Holder speaks during a news conference at the Justice Department in Washington on Tuesday.

    By Jeff Black, Staff Writer, NBC News

    In a major crackdown on healthcare fraud across the country, 89 people, including 14 doctors and nurses, were charged for their roles in various Medicare scams that bilked taxpayers of some $223 million through bogus charges, federal officials said Tuesday.

    Some people allegedly posed as doctors and wrote bogus prescriptions for drugs and psychotherapy therapy and then billed the government $12 million.

    Others are accused of bribing Medicare patients for their ID numbers, then using those numbers to bill $20 million in home health care never performed or not medically necessary.

    The lead suspect in that case used the money to buy luxury cars, including two Lamborghinis and a Ferrari, officials said.

    About 400 federal agents were involved in Tuesday's arrests, raiding businesses, seizing documents and charging suspects in Miami, Los Angeles, Houston, New York City, Detroit, Chicago, Tampa, Fla., and Baton Rouge, La.

    The dragnet was announced by Attorney General Eric Holder and Health and Human Services Secretary Kathleen Sebelius as the latest in a series of busts over the past four years to crack down on fraud that is believed to annually cost Medicare billions of  dollars.


    In all the schemes, profit was a driving force, officials said.

    “Today's takedown is the latest sign we are beginning to turn the tide on Medicare fraud,” Sebelius said in a news conference.

    Holder said during the four-year crackdown by a federal strike force that 1,500 people have been arrested in connection to schemes involving nearly $2 billion in fraudulent billings.

    He claimed that $8 dollars are returned to the U.S. Treasury for every dollar spent on the investigations.

    Still, he said the battle against health care fraud is being affected by the across-the-board budget cuts called sequestration, which have trimmed $1.6 billion in funding from the Justice Department in the current fiscal year ending Sept. 30.

    "Unless Congress adopts a balanced deficit reduction plan and stops the reductions currently slated for 2014, I fear our capacity to protect the American people from healthcare fraud ... will be further reduced," Holder said.

    Sebelius said the Affordable Care Act, widely known as Obamacare, gives the government more tools to combat fraud.

    “By expanding our authority to suspend Medicare payments and reimbursements when fraud is suspected, the law allows us to better preserve the system and save taxpayer dollars.” Sebelius said. “Today we’re sending a strong, clear message to anyone seeking to defraud Medicare: You will get caught and you will pay the price. We will protect a sacred trust and an earned guarantee.”

    In Miami, where 25 people were charged for their role in various fraudulent schemes totaling $44 million, federal officials allege that in one scheme three suspects bribed Medicare patients for their identification numbers, then used the information to bill the government $20 million for medically unnecessary home health care services.

    “The lead defendant spent much of the money from the scheme and purchased multiple luxury vehicles including two Lamborhinis, a Ferrari and a Bentley,” according to a statement from Health and Human Services and the Justice Department.

    In Detroit, 18 people, including two doctors, a physician's assistant and two therapists, were charged in various scams totaling some $49 million in false claims for medically unnecessary services, including home health, psychotherapy and infusion therapy.

    In one Detroit case, three people allegedly posed as licensed physicians and wrote bogus prescriptions for drugs and psychotherapy services totaling $12 million, according to the HHS-DOJ statement. 

    Tuesday’s announcement on the Medicare-fraud sweep was overshadowed by reporters inquiring about two other scandals involving Holder’s Justice Department: That the attorney general’s office seized Associated Press phone records in a probe of a national security leak and a DOJ probe into reports that the IRS gave extra scrutiny to some conservative groups when auditing nonprofit organizations.

  • Colorado governor to potheads: 'Don't break out the Cheetos'

    Brennan Linsley / AP

    People celebrate in a Denver bar after a local television station announced the passage of Colorado's marijuana amendment on Tuesday, Nov. 6, 2012.

    By Andrew Mach, Staff Writer, NBC News

    Colorado’s governor has a message for those excited by the decriminalization of marijuana in his state: “Don’t break out the Cheetos.”


    The reason is that marijuana is still a controlled substance under federal law, raising all sorts off issues for how Colorado and Washington, the other state where voters decriminalized the recreational use of marijuana Tuesday, will implement their initiatives.

    “The voters have spoken and we have to respect their will,” Colorado Gov. John Hickenlooper (D) said after the vote. “This will be a complicated process, but we intend to follow through. That said, federal law still says marijuana is an illegal drug, so don’t break out the Cheetos or goldfish too quickly.”

    In both states, adults aged 21 and older will be allowed to possess a small amount of marijuana, which will be sold in only state-licensed stores where it will be heavily taxed. For the most part, pot could not be consumed in public. In Colorado, the amendment also allows people to grow a few plants at home.

    Colorado and Washington State became the first states ever to make it legal for adults to possess and sell small amounts of pot for recreational use. NBC's Mike Taibbi reports.

    Dr. Kevin A. Sabet, former senior drug policy advisor to the Obama administration and director of the Drug Policy Institute at the University of Florida, suggests these results could portend a growing weed war between the feds and the states.

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    “Once these states actually try to implement these laws, we will see an effort by the feds to shut it down,” Sabet said. “We can only guess now what exactly that would look like, but the recent U.S. attorney actions against medical marijuana portends an aggressive effort to stop state-sponsored growing and selling at the outset.” 

    The texts of each initiative -- Amendment 64 in Colorado and Initiative Measure 502 in Washington -- make clear that the elimination of penalties for possessing up to an ounce of marijuana if you are 21 or older takes effect after 30 days, once the election results are certified. But the provisions allowing commercial production and sale of cannabis for recreational use require regulations that will be written during the next year in both states.

    The Justice Department has so far declined to discuss how the initiatives might function under federal law. Late Tuesday, a spokesman said in an e-mail to NBC News that they were reviewing the Colorado initiative and had no immediate comment.

    Sue Ogrocki / AP file

    "Don't break out the Cheetos or gold fish too quickly," Colorado Gov. John Hickenlooper (D) said after the marijuana initiative was passed in the state Tuesday.

    Obama has cracked down harder on medical marijuana than any president to come before him, argues Rob Kampia, the executive director of the Marijuana Policy Project. In the 17 states where medical marijuana is legal, U.S. attorneys have enlisted the Drug Enforcement Agency and the Internal Revenue Service to take down hundreds of pot shops in just a few short years, Reuters reported.

    Three states weighed in on medical marijuana Tuesday with mixed results. Massachusetts voters approved an initiative allowing people to use marijuana for medicinal purposes. In Arkansas, a similar initiative failed. In Montana, voters approved a plan to revamp an existing medicinal marijuana law to make it more restrictive.

    Former DEA Chief Peter Bensinger, an outspoken opponent of marijuana legalization, said legalization would lead to an increase in crime and threaten public safety.

    “You’ll lose productivity, you’ll have accidents on the highway, you’ll have absenteeism, and you’ll really have a much more weakened society if you have widespread use of marijuana,” Bensinger said.

    Still, proponents argue it’s about time pot was made legal and that the war on weed hasn't worked. 

    “The violence associated with it has become greater, use rates have gone up, the respect toward law enforcement has gone down so the government isn’t achieving any of its stated goals," legalization advocate Allen St. Pierre said. 

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  • Weed wars: If states legalize marijuana, will feds still crack down or steer clear?

    Three states will decide on Tuesday whether to take the unprecedented step of legalizing marijuana. NBC's Pete Williams reports.

    By Bill Briggs, NBC News contributor

    Marijuana-legalization backers believe they’re well schooled on all things leafy – from cannabis to political tea leaves. With pro-pot measures leading in recent polls in Washington and Colorado, proponents don’t foresee federal agents interceding in those states if voters approve the initiatives.


    Their rationale: Two years ago, when California voters considered a similar proposal to legalize the adult possession of an ounce or less of pot, U.S. Attorney General Eric Holder publicly vowed the feds would continue to prosecute anyone in that state caught possessing marijuana — even if the law passed. It failed.

    This year, in contrast, federal anti-drug authorities have repeatedly declined to discuss decriminalization proposals in three states — including a measure in Oregon that would end the prohibition of marijuana there. (That initiative trailed in recent polls.) The response routinely delivered by U.S. Department of Justice spokeswoman Allison Price, including in an e-mail to NBC News: “We are not going to speculate on the outcome of the various ballot initiatives in each of the states.”

    “That, to me, is significant because they didn’t just copy and paste what they did and said in 2010. We feel pretty good about that,” said Alison Holcomb, campaign director for Washington’s Initiative 502, which seeks to regulate and tax marijuana production and distribution in that state. According to a poll released Thursday, Initiative 502 had the support of 55 percent of Washington voters.

    But Dr. Kevin A. Sabet, former senior drug policy advisor to the Obama Administration and director of the Drug Policy Institute at the University of Florida, predicts a far different law-enforcement reality on the ground in Washington — as well as in Colorado, where Amendment 64 would allow the state to regulate marijuana as it does alcohol.

    “Once these states actually try to implement these laws, we will see an effort by the feds to shut it down,” Sabet said.

    Sabet’s vision of post-election pot realities in Washington and Colorado — where Amendment 64 has majority support, according to a recent poll — seems to suggest a possible weed war between the feds and the states.

    “We can only guess now what exactly that would look like,” Sabet said. “But the recent U.S. Attorney actions against medical marijuana portends an aggressive effort to stop state-sponsored growing and selling at the outset.” (That includes, he said, letters sent by federal prosecutors last January to medical marijuana dispensaries in Colorado operating within 1,000 feet of schools, ordering those businesses to halt sales.)

    “The question voters should be asking themselves,” Sabet said, “before voting on these initiatives is this: Is your right to buy pot from a store down the street worth the risk of increased teenage drug abuse, increased enforcement action by the feds, and increased problems like 'stoned driving?’ "

    Whether a legal showdown is ignited or not, some state-legalization proponents see their measures as possible footholds in a march toward national marijuana decriminalization.

    “Exactly 80 year ago, Colorado voters approved a ballot measure to appeal alcohol prohibition, and that came prior to it being repealed by the federal government,” said Mason Tvert, co-director of the Yes on 64 campaign in Colorado, a state that already regulates the sale of medical marijuana. “And it was the individual states taking that type of action that ultimately resulted in the federal (Prohibition) repeal.

    “The same kind of thing is underway with marijuana,” he added. “Whether there’s going to be a critical mass, who knows?”

    In Washington, Holcomb echoed that uncertainty: "I'm not sure how that’s going to play out.”

    “It may be there’s going to some generational evolution on this. Medical marijuana was introduced in the mid-90s and we were still talking to a lot of people that were coming out of the ‘Reefer Madness’ era, who had a lot of fear. And (medical marijuana) was a really powerful way to help them see that marijuana is not this terribly scary thing that they had been told,” Holcomb said.

    Indeed, the most recent poll on Colorado’s Amendment 64 found that 73 percent of state state’s residents who are under age 30 want pot legalized. At the same time, more than half of seniors are against decriminalizing marijuana.

    Anti-drug watchdog Sabet, meanwhile, sides with most current political leaders — “the overwhelming majority of Congress (and) both major presidential candidates” — as well as the American Medical Association standing against the decriminalizing of marijuana: “I don't envision national legalization as a realistic possibility in the near future.”

    “The state-level efforts could soon prove to be a tipping point for more aggressive legalization initiatives,” Sabet said. “However, there is a growing consensus within the medical and treatment community — who deal with the problems of marijuana use and addiction everyday — to reject both extreme prohibition and lax legalization. I think we'll end up with a policy that is more centrist, for example, not punishing people by barring them from a job for a past marijuana arrest, but also not allowing marijuana to be marketed and sold like alcohol or cigarettes.”

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  • 'Fast and Furious': House Republicans sue Attorney General Eric Holder to get documents

    House Oversight Committee Chairman Darrell Issa has told NBC News that House Republicans will file a civil suit against Attorney General Eric Holder. NBC's Pete Williams reports.

    By NBC News staff and wire services

    WASHINGTON - U.S. House Republicans filed a federal lawsuit on Monday against Attorney General Eric Holder, the country's top law enforcement official, seeking to obtain documents on a botched operation nicknamed "Fast and Furious" that sought to link Arizona gun sales to Mexican drug cartels.

    The suit likely means the debate over the anti-gun-trafficking operation will go on for months, lasting through the Nov. 6 elections when Democratic President Barack Obama faces Republican challenger Mitt Romney.

    Republicans' focus on Fast and Furious has helped to energize gun owners, who are a large and important voting bloc in presidential swing states such as Pennsylvania and tend to vote Republican.

    The suit asks for documents Republicans say are critical to their investigation of the operation, but Obama has claimed executive privilege. In June, the Republican-controlled House of Representatives voted to hold Holder in contempt for withholding the documents.

    House Speaker John Boehner, a Republican, said the lawsuit was necessary because the Obama administration was "stonewalling."

    Justice Department spokeswoman Tracy Schmaler said the department, which Holder runs, was "always willing to work with the committee."

    "Instead the House and the committee have said they prefer to litigate," she said.

    GOP prepares to file lawsuit against Holder

    House Minority Leader Nancy Pelosi called the lawsuit a waste of taxpayer money.

    "This partisan lawsuit wastes taxpayer dollars and resources, and is a distraction from the urgent business before Congress: acting to create jobs and grow our economy," Pelosi said in a statement. "It is also designed to distract the Justice Department from its critical job of challenging state laws designed to restrict the rights of Americans to vote."

    Some legal analysts said it should not have taken more than six weeks from the June 28 contempt vote for Republicans to file their suit. Basic elements of the case were contained in the House's citation for contempt, they said.

    "Frankly it suggests that they don't expect to win quickly," said Charles Tiefer, a law professor at the University of Baltimore and a former House acting general counsel.

    It will take months for the case to work its way through the U.S. District Court and any appeals process that might follow, legal analysts said.

    Reuters contributed to this report.

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  • GOP prepares to file lawsuit against Holder

    By NBC's Frank Thorp

     

    House Republicans will file a civil suit against Attorney General Eric Holder during the August recess, House Oversight Committee Chairman Darrell Issa, R-Calif., has told NBC News.

    House Republicans will file suit in an effort to compel Holder to release documents associated with the failed "Fast and Furious" gun-walking operation.

    "We'll be filing a civil case during the break," Issa told NBC, "We will expect a day in court before a federal judge, which we have a 100 percent chance that the judge will hold that these documents should be delivered."

    House Oversight Committee Chairman Darrell Issa has told NBC News that House Republicans will file a civil suit against Attorney General Eric Holder. NBC's Pete Williams reports.

    During negotiations between House Republicans and Holder in June, the White House invoked executive privilege on the documents Issa had requested for his investigation. Issa says that a federal judge should find that executive privilege does not apply to the documents he is requesting.

    "The idea that you would withhold based on some executive privilege the documents related to a cover up of a crime is absurd, but that's the claim that the attorney general is hiding behind," Issa said.

    The House voted on June 28th, 255-67, to hold Holder in contempt of Congress for not turning over documents related to the Fast and Furious operation. During that vote, the vast majority of Democrats walked off the floor of the House in protest of a measure they saw as a political witch hunt.

    Soon after the House found Holder in contempt of Congress, the Justice Department penned a letter to House Republicans saying it would not be pursuing the case, stating that "the attorney general's response to the subpoena issued by the Committee on Oversight and Government Reform does not constitute a crime." The DOJ cited the White House invoking executive privilege as a primary reason for not proceeding.

    Larry Downing / REUTERS

    U.S. Attorney General Eric Holder during a meeting at the White House in Washington, July 26, 2012.

    The DOJ's response has left Republicans with few options, according to Issa, who compared the current situation with congressional attempts to retrieve the Nixon tapes during their investigation into the Watergate scandal in the 1970s.

    "We're seeking a remedy and the remedy is an order to compel," Issa said. "Nixon didn't respond to Congress, he responded to federal judges, ultimately the Supreme Court, ordering that he had no such privilege to cover up the tapes. And these are no different than the Nixon tapes, we're asking for documents related to a cover up of lying to Congress."

  • Feds reveal more charges in murder tied to 'Fast and Furious'

    FBI

    The Justice Department Monday unveiled new charges against Ivan Soto-Barraza and four others for the murder of Border Patrol Agent Brian Terry.

    By NBC News' Pete Williams

    Federal prosecutors on Monday revealed more charges in the murder of U.S. Border Patrol Agent Brian Terry.

    The indictment, unsealed Monday in Tuscon, Ariz., charges five men with involvement in Terry's death, which is at the center of a controversy over a Bureau of Alcohol, Tobacco and Firearms and Explosives (ATF) gun tracking operation known as "Fast and Furious."


    According to the indictment, Manuel Osorio-Arellanes, Jesus Rosario Favela-Astorga, Ivan Soto-Barraza, Heraclio Osorio-Arellanes and Lionel Portillo-Meza are charged with crimes including first degree murder, second degree murder, conspiracy to interfere with commerce by robbery, attempted interference with commerce by robbery, use and carrying a firearm during a crime of violence, assault on a federal officer and possession of a firearm by a prohibited person.  

    The 11-count indictment alleges that on Dec. 14, 2010, five of the defendants engaged in a firefight with Border Patrol agents. Terry was shot and killed in the gunfire.

    The defendants illegally entered the United States from Mexico to rob drug traffickers of their contraband, according to the indictment.

    In addition to the murder of Terry, the indictment also alleges that the five defendants assaulted Border Patrol Agents William Castano, Gabriel Fragoza and Timothy Keller, who were with Terry during the shootout.

    A sixth defendant, Rito Osorio-Arellanes, is charged only with conspiracy to interfere with commerce by robbery.

    Two of the individuals involved with the shooting are already in custody: Manuel Osorio-Arellanes was arrested on the night of the shooting and Rito Osorio-Arellanes was arrested by Border Patrol agents on December 12, 2010, on immigration charges.

    The FBI is offering a reward of up to $1 million for information leading to the arrest of the remaining fugitives.

    Related: House votes to cite Holder for contempt
    Related: Republicans to press 'Fast and Furious' suit

    "We will stop at nothing to bring those responsible for his murder to justice," Attorney General Eric Holder said in a statement. "Today's announcement reflects the department's unrelenting commitment to finding and arresting the other individuals responsible for this horrific tragedy so that Agent Terry's family, friends and fellow law enforcement agents receive the justice they deserve."

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  • Rep. Issa: No evidence of White House cover-up in 'Fast and Furious' gun-running case

    Michael Reynolds / EPA file

    Republican Rep. Darrel Issa, center, and Democratic Rep. Elijah Cummings rise after the House Oversight and Government Reform Committee approved a resolution holding Attorney General Eric Holder in contempt of Congress over the handover of documents related to the failed 'Fast and Furious' program, on Capitol Hill on June 20.

    By Reuters

    WASHINGTON -- The congressman heading an investigation into a botched gun-trafficking case said on Sunday he had no evidence the White House was involved in a cover-up about the operation or in providing misleading information to Congress.

    However, Republican Rep. Darrell Issa said documents the White House was shielding under an executive privilege claim would shed more light on how much high-level officials knew about a misleading Feb. 4, 2011, letter to Congress denying that guns had been allowed to "walk" into the hands of Mexican drug cartels.

    Backing the recommendation of the House oversight committee, Speaker John Boehner asked the Obama administration to turn over documents related to Attorney General Eric Holder's botched gun trafficking operation. NBC's Brian Williams reports.

    Republicans, who control the House of Representatives, have suggested that some sort of a cover-up of information explained why it took until December 2011 for the Justice Department to formally withdraw the letter about the case, which was named "Operation Fast and Furious."

    The House is set to vote this week on contempt of Congress charges against U.S. Attorney General Eric Holder, the top U.S. law enforcement official, for withholding access to some of those documents.

    Speaking on "Fox News Sunday," Issa, the chairman of the House Oversight and Government Reform Committee, was asked whether he had evidence of a White House cover-up.

    "No, we don't," Issa said.

    "I hope they don't get involved," Issa said. "I hope this stays at Justice. And I hope that Justice cooperates, because ultimately, Justice lied to the American people on February 4th and didn't make it right for 10 months."

    Congressional investigators say the documents will shed light on who in the Justice Department knew the letter was misleading and why it took so long to withdraw it. 

    Democrats have accused Issa of going on a fishing expedition and note that the Justice Department has already turned over thousands of pages of documents relating to the botched operation, in which guns were allowed to be transported into Mexico.

    Two of the weapons were later found at the scene of U.S. border patrol agent Brian Terry's murder in late 2010.

    Terry's grieving family has demanded more information about who knew about the "Fast and Furious" operation.

    Rep. Elijah Cummings, the top Democrat on the oversight committee, told "Fox News Sunday" that he too wants to satisfy the Terry family's need for information and said the dispute over documents could be worked out.

    "It's just a matter of sitting down and talking it over. We can get those documents and get this matter resolved," Cummings said.

    Asked if the House would seek to hold Holder in contempt if there was no deal over the documents, Issa said: "Yes, I believe they will, both Republicans and Democrats will vote that."

    It could take months to enforce a contempt citation as both sides are likely to turn to the federal courts to resolve the dispute between the White House and Congress.

    Issa suggested a deal could be worked out with administration officials, to cancel, or at least delay, next week's vote.

    "If we get documents that ... cast some doubt or allow us to understand this, we'll at least delay contempt and continue the process," Issa said in an interview with ABC's "This Week" news show. "We only broke off negotiations when we got a flat refusal to give us information needed for our investigation."

    House Republicans advanced the contempt resolution after negotiations with Holder broke down last week. Holder had offered to brief congressional investigators and provide access to some documents to satisfy a congressional subpoena. Issa rejected the offer.

  • Attorney General Holder names 2 prosecutors to investigate possible leaks

    Charles Dharapak / AP

    Attorney General Eric Holder testifies on Capitol Hill.

    By msnbc.com staff and news services

    Attorney General Eric H. Holder Jr. on Friday appointed two United States attorneys to investigate possible unauthorized disclosures of classified information from the White House and Congress.

    The appointment came the day President Barack Obama at a news conference rebutted accusations that his administration leaked information about a terrorist “kill list” and cyber warfare to make himself look tough in an election year.

    Holder issued a statement saying Ronald C. Machen Jr., the attorney for the District of Columbia, and Rod J. Rosenstein, from the District of Maryland, will lead separate criminal investigations already under way by the Federal Bureau of Investigation.

    “The unauthorized disclosure of classified information can compromise the security of this country and all Americans, and it will not be tolerated,” Holder said in the statement.

    “Machen and Rosenstein are fully authorized to prosecute criminal violations discovered as a result of their investigations and matters related to those violations, consult with members of the Intelligence Community and follow all appropriate investigative leads within the Executive and Legislative branches of government,” Holder said.

    The accusations about the Obama leaks surfaced in two articles in The New York Times last week.


    Obama on Friday said that such leaks dealt with the safety of the American people, its military and its allies.

    "The notion that my White House would purposely release classified national security information is offensive," he said. "It's wrong and people I think need to have a better sense of how I approach this office."

    On Capitol Hill, a lawmaker said there were indications a high-level individual was involved in the media disclosures.

    "Someone from a very senior clearance level has provided information, that's very clear in the preliminary review," Rep. Mike Rogers, the Republican chairman of the House Intelligence Committee, told Reuters.

    Rogers did not speculate on who the leaker might be.

    The top Democrat on the House intelligence committee, C.A. "Dutch" Ruppersberger, said he did not believe anyone had been targeted in early investigations into the leaks.

    The recent spate of disclosures included the revelation that a plot by the Yemen branch of Al Qaeda to bomb an airliner had been foiled because of penetration by a double agent, details about the joint American-Israeli computer virus called Stuxnet that sabotaged Iran’s nuclear centrifuges, and an account of Mr. Obama’s role in approving a “kill list” of terrorism suspects for drone strikes, The New York Times reported.

    For the first time, Israel has admitted to engaging in cyber warfare "consistently and relentlessly" according to a Sunday report from the Israel Defense forces. But the IDF stopped short of admitting it participated in creating or using the Stuxnet computer virus against Iran. Amb. Michael Oren discusses.

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