Twenty-Six Charged in Nationwide Scheme to Defraud the
FCC’s Video Relay Service Program
Arrests Made in Nine States
WASHINGTON—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, Maryland;
- 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, Florida.; and
- Deaf Studio 29 of Huntington Beach, California.
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, Maryland; Viable Chief Operating Officer
Joseph Yeh, 64, of Potomac; Viable Assistant Vice President Anthony Mowl,
25, of Rockville, Maryland; 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, New York; DHIS bookkeeper Oksana
Strusa, 35, of Jersey City, New Jersey; 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, Florida; ICSD call center manager Wanda Hutchinson, 35, of
Pembroke Pines, Florida; 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,
Arizona; Rubeck, 34, of Surprise, Arizona; 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, Oregon; Ellen
Thompson, 43, of Lake Oswego, Oregon; 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.
