U.S. Attorney’s Office Indicts Burke Co. Drug and Alcohol Treatment Center, Its Owner, and Two Employees on False Claims Act Conspiracy and Bribery Charges
|U.S. Attorney’s Office August 12, 2013|
ASHEVILLE, NC—A Burke County drug and alcohol treatment center, its owner, and two of its employees have been indicted on False Claims Act conspiracy and bribery charges, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. The six-count indictment was returned by a federal grand jury sitting in Asheville on August 6, 2013.
John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Gregory A. Forest, Chief of the United States Probation Office for the Western District of North Carolina, join U.S. Attorney Tompkins in making today’s announcement.
Charged in the federal criminal indictment are Clean on Green PLLC (“Clean on Green”), based out of Morganton and Lenoir, North Carolina; Lewis R. Dorman, III, 62, of Morganton and owner of Clean on Green; Levi J. Michaels, 41, also of Morganton; and Lerry Ratley, 60, of Rock Hill, South Carolina. All defendants are charged with one count of conspiracy to violate the False Claims Act. Dorman and Ratley are charged with one count of bribery of a public official and Michaels with four such counts. Dorman and Clean on Green also face one count of making false, fictitious, or fraudulent claims.
According to the indictment, Clean on Green was a facility providing alcohol and drug treatment services in Morganton. Dorman was the owner and operator of Clean on Green, and in that capacity, Dorman signed contracts with the U.S. Probation Office for the Western District of North Carolina to provide counseling services and to administer the collection and processing of urinalysis samples of individuals on federal pretrial release, supervised release, parole, or probation. According to the indictment, Michaels was employed by Clean on Green and was responsible for managing the office, scheduling appointments, processing persons for substance abuse assessments, administering and monitoring urinalysis screening for persons on federal probation, and scheduling individual drug and alcohol abuse counseling sessions. Also according to the indictment, Ratley worked at Clean on Green and his primary duty was to conduct group counseling sessions.
The indictment alleges that under its contract with the U.S. Probation Office, Clean on Green was required to collect and test urine samples from probationers or parolees for the presence of controlled substances and to provide the results to the U.S. Probation Office. The U.S. Probation office relied upon these results to inform the U.S. District Court or the Parole Commission as to whether a probationer or parolee was using controlled substances, which would be a violation of the conditions of release or parole. According to the indictment, the contract between Clean on Green and the U.S. Probation Office specified a urine collection protocol to ensure that the test results were accurate and reliable.
The indictment alleges that between 2010 and 2012, Dorman and Michaels did not follow the specific protocol for the urinalysis collection and instead allowed individuals to fraudulently submit substitute urine samples to avoid the detection of a controlled substance. According to the indictment, on multiple occasions Michaels accepted $40 to $50 as cash payments in exchange for allowing individuals under federal supervision to bypass proper urine collection protocols. On at least occasion, according to the indictment, Dorman also accepted a cash payment.
According to the indictment, Clean on Green also had a contract with U.S. Probation to provide individual and group counseling sessions to persons under federal supervision. The procedure required that such persons sign in and out of the counseling sessions and a Clean on Green employee was responsible for verifying the accuracy of the attendance records. From 2010 and continuing until around July 2012, according to the indictment, Doman and Ratley repeatedly allowed individuals supervised by U.S. Probation to claim attendance at counseling sessions when they did not attend the required sessions. The indictment alleges that, on several occasions, Ratley accepted cash payments from federally supervised persons for allowing them to skip the required counseling sessions. The indictment alleges that on one such occasion, a supervised individual scheduled to attend a three-hour group counseling session only stayed at the facility approximately three minutes and, in return, paid Ratley $40 in cash to falsify the sign in/out forms. The indictment alleges that Dorman submitted these false forms to the U.S. Probation Office along with Clean on Green invoices for those services provided.
U.S. Attorney Tompkins stated, “The defendants’ brazen conduct and utter disregard of the trust bestowed upon them compromised the integrity of the legal system. This kind of conduct cannot be allowed to go on unchecked.”
“These individuals allowed countless criminals to cheat the judicial system in order to line their own pockets. Now they will be held accountable for taking money from those offenders unwilling to follow the conditions of their release,” said John A. Strong, Special Agent in Charge, FBI Charlotte.
“The U.S. Probation Office would like to thank U.S. Attorney Tompkins, the U.S. Attorney’s Office, and the FBI for their quick action in this case. The fraud associated in this case had the potential to impact public safety and the safety of U.S. Probation Officers in the Western District of North Carolina. This serves and an outstanding example of federal agencies working together to protect the public and their interests,” said Chief U.S. Probation officer Gregory A. Forest.
The False Claims conspiracy charge carries a maximum of 10 years in prison and a $250,000 fine. The false, fictitious, or fraudulent claims charge carries a maximum of five years in prison and a $250,000 fine, and each bribery of public official charge carries a maximum of 15 years in prison and a $250,000 fine.
Dorman and Michaels were arrested on Friday, August 9, 2013, and have been released on bond. Ratley was arrested earlier today. His initial appearance will be scheduled by the Court.
The charges contained in the indictment are allegations. They defendants are presumed innocent unless and until they proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by the FBI in cooperation with the U.S. Probation Office. The prosecution is handled by Assistant U.S. Attorney Richard Lee Edwards of the U.S. Attorney’s Office in Asheville.