US Attorney in Harrisburg announces $22M in fines last year

27 January 2023- U.S. Attorney Gerard M. Karam announced today that the Middle District of Pennsylvania collected $26,268,064.48 in criminal and civil actions in Fiscal Year (FY) 2022.  Of this amount, $3,916,063.20 was collected in criminal actions and $22,352,001.28 was collected in civil actions

Additionally, the Middle District of Pennsylvania worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $2,612,653.43 in criminal and civil cases pursued jointly by these offices.

“The cases we prosecute and litigate don’t always end when a defendant is sentenced or a case is settled,” said United States Attorney Karam.  “When someone is defrauded or injured or a defendant steals taxpayer money, it’s our job to get that back. I’m proud to say that over the past year we have returned millions of dollars to crime victims in this district and clawed back millions more in taxpayer dollars. Victims of fraud, of sex trafficking, and other crimes have received much needed compensation for what they lost and for the physical and mental trauma they suffered at the hands of criminal defendants. We take our duty to crime victims and to the taxpayers of this district seriously, and we will continue to work to collect what is owed.” 

The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims.  The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.  While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.  The Middle District of Pennsylvania worked to collect $3,916,063.20 from criminal debtors and $22,352,001.28 from civil debtors in FY 2022.

For example:         

Om Sri Sai, Inc., a Bartonsville company that owned and operated a Howard Johnson Hotel and was convicted of sex and drug trafficking after a jury trial in 2020, was ordered to pay over $277,000 to victims trafficked through the hotel. Through the efforts of the United States Attorney’s Office, those victims were paid full restitution in 2022.

The USAO collected $500,000 from two defendants, Hope Carbone and Donna Venturini.  The defendants imported cigars through D&H Marketing and evaded more than $1.8 million in unpaid excise taxes.

Lobar Inc., a construction company based in Dillsburg, Pennsylvania, paid $400,000 in restitution for Clean Air Act violations.

As part of a civil settlement, KFC Technologies repaid $1,226,436.14 it received through improper billing from the Departments of the Army and Navy.

The USAO collected almost $900,000 from Penn State University as part of a civil settlement related to improper billing to Medicare.

Additionally, the U.S. Attorney’s Office in the Middle District of Pennsylvaniaworking with partner agencies and divisions, obtained forfeiture judgments amounting to $3,742,379 in criminal and civil asset forfeiture actions in FY 2022, including both physical assets and forfeiture money judgments. Generally, under federal law assets such as currency, real property, and personal property can be forfeited to the government when they constitute proceeds of illegal activity or were used to facilitate crime.  Forfeited assets deposited into the Department of Justice Asset Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.

For example:

The USAO won a civil forfeiture of $650,160 in drug trafficking proceeds. The cash was hidden in a cereal box in the trunk of a car and was being driven from New York to California by a hired courier.

Another $345,950 in drug trafficking proceeds, also seized from a vehicle making a cross-country trip, was forfeited in 2022. The cash was found in Ziploc baggies with brass knuckles and loaded tasers during a routine car stop.

Om Sri Sai, Inc. was ordered to forfeit $2 million cash in lieu of the company’s hotel property after conviction on sex trafficking and drug trafficking charges. The company’s largest shareholder and general manager were also convicted and sentenced to prison terms. Over $277,000 from the forfeited funds was used to pay restitution to sex trafficking victims.

The government collected a $1.4 million forfeiture money judgment from Daniel and Benjamin Gutman at the time of their sentencing in November 2022. The brothers operated a livestock exporting business in Maryland and South Central Pennsylvania and worked with a veterinarian to falsify certifications and blood sample/vaccination reports for tuberculosis testing for thousands of cattle due to be shipped abroad. As part of their sentence, the brothers were ordered to forfeit $1.4 million in proceeds of their crimes.