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Facts and Figures 2003


White-Collar Crime

White-collar crimes are categorized by deceit, concealment, or violation of trust and are not dependent on the application or threat of physical force or violence. Such acts are committed by individuals and organizations to obtain money, property, or services, to avoid the payment or loss of money or services, or to secure a personal or business advantage.

The FBI investigates white-collar criminal activities, such as money laundering, securities and commodities fraud, bank fraud and embezzlement, environmental crimes, fraud against the government, health care fraud, election law violations, copyright violations, and telemarketing fraud. In general, the FBI focuses on organized crime activities that are international, national, or regional in scope and where the FBI can bring to bear unique expertise or capabilities that increase the likelihood of a successful investigation and prosecution. In the health care fraud arena, the FBI targets systemic abuses, such as large-scale billing fraud that is national or regional in scope and fraudulent activities that threaten the safety of patients. The FBI pursues financial institution fraud involving $100,000 or more. In cases of telemarketing and insurance fraud, the FBI will generally become involved where there is evidence of nationwide or international activities.

COPYRIGHT INFRINGEMENT CASE: OPERATION CYBERSTORM

In March 2000, the FBI started undercover operation CYBERSTORM to find and prosecute individuals and groups involved in making and selling counterfeit software and illegally re-marking computer central processing units (CPUs).

Several cooperative witnesses told investigators that some individuals and companies in San Jose, California, were engaged in the illegal remarking and brokering of CPUs and the manufacture and sale of counterfeit computer software. Based on this information, as well as findings from a preliminary FBI investigation, numerous individuals and companies were identified as being involved in the production and distribution of re-marked CPUs and counterfeit software.

An undercover Agent started and ran a phony business engaged in the buying and selling of gray market CPUs and computer software. In order to be accepted by the computer industry, the Agent routinely purchased counterfeit products and sold legitimate computer components to targeted companies.

CYBERSTORM uncovered a large network of software pirates and manufacturers in California. On April 18, 2002, 27 individuals were arrested, and the counterfeit products recovered during the conduct of these searches were estimated to be in the tens of millions of dollars.

HEALTH CARE FRAUD CASE: ROBERT R. COURTNEY
In July 2001, the FBI's Kansas City Division discovered that Robert Courtney, a pharmacist, was diluting doses of Gemzar and Taxol, two chemotherapy drugs used to treat cancer patients. Agents set up a sting operation to purchase drugs from Courtney's pharmacy and sent approximately six prescriptions to the Food and Drug Administration for testing. The tests showed that prescriptions prepared by Courtney, which should have had 100 percent of the prescribed drugs, actually had anywhere from 39 percent to less than 1 percent of the cancer drug.

On August 23, 2001, a federal grand jury returned an indictment against Courtney and his pharmacy, charging eight counts of tampering involving serious bodily injury and twelve counts of adulteration/misbranding. On February 26, 2002, Courtney pleaded guilty to all 20 counts and agreed to accept a sentence of between 17 1/2 years and 30 years in prison, to forfeit all of his property, and to provide the government with a full accounting of all his criminal activities and the criminal activity of any other individual involved.

GOVERNMENTAL FRAUD CASE: APRIL 8 REALTY, LA PUENTE, CALIFORNIA

April 8 Realty fabricated and sold hundreds of false real estate loan file documents to over 100 real estate agents and investors in the Los Angeles area between 1997 and 1999. The FBI's investigation included an undercover sting operation in which real estate agents and investors were videotaped purchasing fraudulent loan documentation as part of a joint Office of Inspector General, Department of Housing and Urban Development, and FBI housing fraud initiative. The supporting documentation used to qualify otherwise unqualified home buyers consisted of fraudulent W-2 forms, manufactured employee pay verification forms, altered bank statements, and fictitious letters of credit. In total, these fraudulent documents were used to secure over 1,000 US Government-insured loans. The investigation led to the guilty pleas of 18 real estate professionals involved in the fraud in 2001.

HEALTH CARE FRAUD CASE: TAP PHARMACEUTICALS

In 1996, TAP Pharmaceuticals earned $500 million on Medicare reimbursement for Lupron, a drug to treat prostate cancer. TAP is not directly reimbursed by Medicare for purchases of Lupron. Rather, Lupron is purchased by urologists from TAP's sales representatives. The urologist then submits a claim to Medicare or any other insurance plan for reimbursement. Once the urologist is paid, the urologist then pays TAP for his purchases of Lupron. An FBI investigation revealed that TAP paid kickbacks to urologists. The kickbacks were paid in several ways, including unrestricted grants and free samples, free kits of Lupron, office equipment, software, and tickets to sporting and cultural events.

On October 3, 2001, TAP entered into the second largest health care fraud settlement agreement in the United States. TAP was sentenced to a $290 million criminal fine and accepted a $585 million civil settlement. In addition, TAP was required to pay interest of approximately $10 million as agreed to in the settlement. Four urologists were convicted in connection with this case for the selling of Lupron samples.

Significant Violent Crime

Combating significant violent crime is a traditional area of FBI expertise. The Bureau concentrates on crime problems that pose major threats to the integrity of American society, such as criminal street gangs, bank robberies, carjackings, kidnappings, interstate transportation of stolen property and motor vehicles, assaults and threats of assault on federal officials, assaulting the President, theft or destruction of government property, and fugitive matters.

 

 

 

 

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