4-17-19 Fortinet this week agreed to pay the US government $545,000 to settle claims it allowed employees to peddle Chinese-made gear that would eventually end up being illegally supplied to federal agencies. The Silicon Valley-based security house coughed up the cash after the Department of Justice (DOJ) alleged the vendor's sales staff had provided some of its resellers Chinese hardware disguised as having originated in other countries.
The mislabeled products, according to prosecutors, eventually made their way down the supply chain to resellers that dealt with US government agencies, many of them who were subject to the US Trade Agreements Act, a law that among other things bars the use of certain Chinese-made technology by federal agencies. The gear was also supplied in part to the United States Army, who wasn't particularly happy about that, it is claimed.
According to Uncle Sam's prosecutors, a single rogue employee oversaw the mislabeling scheme from 2009 until 2016, when employee Yuxin "Jay" Fang tore the lid off the whole thing with a whistleblower lawsuit. https://www.theregister.co.uk/2019/04/17/doj_fortinet_case/
………………………
According to settlement documents released Friday in a qui tam case against California-based network security company Fortinet, Inc., the relator represented by Sanford Heisler Sharp was awarded 19% of the $545,000 the company was fined for selling equipment made in China to the U.S. Government.
While working at a Fortinet facility in Canada preparing electronic products for sale to the U.S. government and other customers, Fang noticed “Made in China” product labels were being removed and replaced with labels that either did not state or misrepresented the country of origin. He collected the discarded labels and later discovered the company’s practice was a violation of the U.S. Trade Agreements Act (TAA), which does not allow the U.S. Government to purchase products made in China except under limited circumstances.
Fang filed a qui tam action in the U.S. District Court for Northern California in January 2016, alleging Fortinet labeled or omitted labels of products in a way that falsely represented them as compliant with the TAA. While the matter was under investigation by U.S. officials, former Akin Gump partner
Jeffrey Wertkin hatched a scheme to sell copies of sealed government complaints he had collected when he worked for the US Attorney-General, including Fang’s qui tam complaint.
When Wertkin approached Fortinet for a deal the company notified federal authorities, which led to a sting operation that culminated in Wertkin’s arrest and conviction.
“On the one hand Fortinet engaged in a brazen and fraudulent scheme that included creating phony labels, but on the other hand, the company did the right thing when Wertkin offered to sell it sealed government documents,” said Vincent McKnight. “I am certain its cooperation influenced the amount of the final settlement agreement on the mislabeling charges.” At the end of the day, Fortinet paid a $545,000 fine for mislabeling its products between 2009 and 2016; Fang was awarded 19% of the fine; and Wertkin is serving time for his crime. https://sanfordheisler.com/case/fortinet-qui-tam-settlement/
……...........….
1-25-18 Jeffrey Wertkin had a plot to bring in business and impress his new partners after joining one of Washington's most influential law firms. Wertkin carried out his plan for months, right up until the day an FBI agent arrested him in a California hotel lobby.
The 41-year-old partner at Akin Gump Strauss Hauer & Feld in the District was caught wearing a wig and fake mustache trying to peddle a sealed federal lawsuit for $310,000 to a Silicon Valley technology company. "My life is over," he told the undercover agent after his arrest at an intended cash drop at the Cupertino hotel.
Wertkin has admitted hawking sealed files he spirited out of the Justice Department's civil-fraud division where he worked for six years until 2016. …
Before his sentencing, Wertkin has promised to meet with Justice Department supervisors to tell them how he managed to steal sensitive documents without being detected. The pledge is part of his plea deal on charges of obstructing justice and transporting stolen property when he took a file from Washington to California for a sale before he was caught last January.
When he gathered up the cases in his last month on the federal job in April 2016 "I knew and understood that doing so was an illegal theft of the complaints and, during my exit process, I intentionally lied to the Department of Justice about taking the complaints with me," Wertkin said in court at his plea hearing.
Exactly how many cases he stole or what he did with all of the information remains murky, but Wertkin was clear in his 10-page plea agreement about why he did it: "I began secretly reviewing and collecting complaints to identify clients to solicit for business when I was in practice and, thereby, to make myself more successful at Akin Gump."improperly solicit" more business, managing in one case to convince a company "to retain my services as an attorney to represent it in its lawsuit."
After his arrest last Jan. 31, Wertkin returned to Washington to clean out his Akin Gump office near Dupont Circle where he removed and destroyed electronic and paper copies of other stolen cases "that I knew could further incriminate me," he said in plea papers.
At the Justice Department, where he started working in December 2010, Wertkin's assignments included cases that often result in multimillion-dollar corporate paybacks to the government after whistleblowers — who can receive part of recovered funds — tip off investigators to fraud in federal services and contracts.
Known as qui tam lawsuits under the False Claims Act, the cases are brought under seal to protect the investigations and the whistleblowers. There were 702 qui tam actions filed in 2016, and the Justice Department recovered $4.7 billion under the law, it reported. Wertkin "led more than 20 major fraud investigations" at the department, Akin Gump said when it announced his hiring.
In violating that secrecy Wertkin may have done "irreparable harm" by scaring off future whistleblowers, said Nola J. Hitchcock Cross, a managing attorney at the Cross Law Firm of Milwaukee, who worked with a whistleblower in one of Wertkin's federal fraud cases. "Any whistleblowers will not bring fraud to the government's attention through the False Claims Act if they are influenced by Mr. Wertkin's conduct and fear that their identity will not, in fact, remain under seal during the government's investigation," Cross said. "Every time a potential whistleblower hesitates to bring fraud to the government attention, the taxpayers suffer a potential loss, often in the hundreds of millions of dollars."
The Justice Department has not said what damage Wertkin's actions may have caused or how it is assessing his impact. But in responding to a Senate Judiciary Committee inquiry about Wertkin's case after his arrest, then-acting Assistant Attorney General Samuel R. Ramer wrote that the Department was not aware of any accusations of misconduct by Wertkin while he worked there and that its Office of Professional Responsibility had no record of any complaints.
Wertkin, the son of a surgeon and a registered nurse in the affluent New York City suburbs, graduated from Haverford College in 1998 and earned a law degree and a master's degree in government from Georgetown University. He is married with a young son and a daughter.
In 2010 Wertkin left the Patton Boggs law firm to join the Justice Department. During his time at Justice he also for three years taught a seven-week-long class on federal agency rule-making as an adjunct professor at Georgetown University. He bought a condominium in Washington's Dupont Circle neighborhood, which he used to secure his release on $750,000 bond after his arrest.
"On its face it's a breakdown," said a legal colleague who asked for anonymity to avoid jeopardizing a friendship with Wertkin and his pending sentencing. "It's hard to understand and it's not understandable, because it doesn't fit anything else in his life. He was an unusually straight arrow. Wertkin has resigned from the bar," the person said, and is "back to the guy he's always been" and is spending time taking care of his children.
"And the whole time I was with him, which I can't count the number of hours, he displayed great integrity, and he had serious concern for the interests of the United States," Barger said. "Why he did what he did I don't know.” Wertkin pleaded guilty to two counts of obstructing justice by disclosing the two sealed lawsuits and to one count of interstate transport of stolen property.
The charges carry a statutory maximum of 20 years in prison, but in the plea agreement both sides reached prosecutors would not seek a prison term of more than 30 to 37 months barring additional discoveries about Wertkin's conduct. https://www.washingtonpost.com/local/public-safety/ex-justice-dept-lawyer-peddled-secret-us-whistleblower-suits-to-try-to-impress-his-bosses-with-new-clients/2018/01/24/49b7d934-e414-11e7-a65d-1ac0fd7f097e_story.html
………………….
The sentencing memorandum filed on behalf of Jeffrey Wertkin says he had hoped that selling the sealed complaints could help him provide his family a new house in a better neighborhood and allow him to leave his law firm, Akin Gump Strauss Hauer & Feld….He had earned a law degree from Georgetown University and completed his Ph.D. when he was working as an associate at Patton Boggs. Wertkin believed he could use the complaints to help him know which companies to target in marketing efforts. Once he joined Akin Gump, Wertkin began working longer hours and his stress level increased. He began drinking too much coffee during the day and consuming too much alcohol and edible marijuana at night.http://www.abajournal.com/news/article/former_partner_blames_biglaw_stress_for_plot_to_sell_sealed_lawsuits_to_tar
……………….….
Federal prosecutors accidentally returned an external hard drive to former DOJ lawyer Jeffrey Wertkin that contained the 40 whistleblower cases he pleaded guilty to stealing and trying to sell, according to a letter Wertkin sent to the judge overseeing his case. https://www.law.com/therecorder/2018/03/21/wertkin-to-judge-feds-handed-me-hard-drive-with-40-whistleblower-complaints/?slreturn=20191012144656
……......................
Prosecutors said that before leaving the Justice Department Wertkin began making electronic copies of lawsuits or sneaking into his boss's office at night to copy complaints he found there. After his arrest Wertkin returned to Akin Gump to destroy evidence and stage his office to falsely implicate other Justice Department officials as the source of the complaints, prosecutors said. https://www.usnews.com/news/us/articles/2018-03-07/lawyer-who-stole-us-whistleblower-lawsuits-receives-prison-term
…...............................…
https://books.google.com/books?id=sWcolDneRrMC&pg=PT201&dq=hysta+beijing&hl=en&newbks=1&newbks_redir=0&sa=X&ved=2ahUKEwjy6tO_1OXlAhWJlp4KHSJ2BkMQ6AEwAHoECAUQAg#v=onepage&q=hysta%20beijing&f=false
No comments:
Post a Comment