The biggest white-collar cases in Texas in 2024 included nine-figure healthcare fraud prosecutions, alleged crypto investment scams and the ongoing battle royal involving the Boeing Co., the Justice Department and survivors of the victims of two crashes of Boeing’s 737 Max jetliner.
Federal prosecutions suggested yet again this year that if there’s a way to steal from Medicare, other government healthcare programs and private insurers, someone will find it. Some of the biggest cases of 2024 involved allegations of useless genetic testing, prescriptions for phantom patients, overpriced cardiac scans and nonexistent treatment of injured college athletes. (The cases are at various stages of litigation; some remain pending.)
What follows is a list, based on research by The Texas Lawbook, of the 10 largest white-collar cases to land on dockets in the state. The cases are ranked by the dollar amounts involved, usually as asserted by the government. (If we — meaning I — missed any, please let me know.)
One development that doesn’t fit that monetary ranking (yet) but nonetheless clearly deserves mention is the roiling of the bankruptcy court in the Southern District of Texas stemming from a long-hidden romantic relationship between Bankruptcy Judge David Jones (who has since resigned) and a bankruptcy partner with Jackson Walker. The firm was paid more than $20 million – fees often approved by Judge Jones – for its work in dozens of high-profile bankruptcies in which he served as judge or mediator
“A scandal of epic proportions,” said Nancy Rapoport, former dean of the University of Houston Law Center and a bankruptcy law expert.
“A mess, a complete fiasco,” said Royal Furgeson, a retired U.S. district judge and former dean of the University of North Texas at Dallas College of Law.
The scandal/mess/fiasco has been meticulously covered by my colleagues Mark Curriden and Michelle Casady. The Lawbook has been on this story since breaking the news in October 2023 that Judge Jones, one of the country’s most prominent bankruptcy judges, was stepping down. It’s a safe bet Michelle and Mark will still be covering it when 2025 comes to a close.
Here, then, our top 10 white collar cases of 2024:
1. Ukrainian Hacker Imprisoned in Global Ransomware Scam
Federal authorities in Dallas led the prosecution of a Ukrainian hacker accused of conducting more than 2,500 ransomware attacks worldwide, including on businesses in Dallas and Addison, and demanding more than $700 million in ransom.
On May 1, Yaroslav Vasinskyi was sentenced by U.S. District Judge Karen Gren Scholer to 13 years and seven months in prison and ordered to pay more than $16.8 million in restitution to more than two dozen affected businesses and insurers.
Vasinskyi pleaded guilty in July 2022 to conspiracy to commit fraud and related activity in connection with computers; damage to protected computers; and conspiracy to launder money. An 11-count indictment issued the previous August said he and others infected computers around the world with malicious software designed to lock owners out of the computers’ data by encrypting it, then demanded ransom payments in exchange for a decryption key. Further, the indictment said, the hackers published portions of the victims’ data to prove they controlled it and threatened to expose it all if their ransom demands weren’t met.
Vasinskyi was extradited from Poland to face the U.S. charges.
The case was prosecuted by Assistant U.S. Attorney Tiffany H. Eggers of Dallas and Frank Lin of the Department of Justice’s computer crime and intellectual property section in Washington, D.C. Assistant U.S. Attorney Dimitri Rocha of Dallas assisted in related civil forfeiture cases.
Vasinskyi’s lead lawyer was from Brooklyn, New York. His local counsel was Stephen Green of GreenClark in Dallas.
The case number in the Northern District of Texas is 3:21-cr-00366.
2. Crypto ‘Investor’ Charged with Targeting Haitian Americans
An investigation by the Fort Worth regional office of the U.S. Securities and Exchange Commission resulted in civil fraud charges against a multilevel marketing company accused of bilking more than 200,000 investors worldwide out of more than $650 million in crypto assets.
According to a civil complaint by the SEC, Nova Tech Ltd., a company registered in St. Vincent and the Grenadines, lured clients, many of them Haitian-Americans, into letting the company trade for them on crypto-asset and foreign-exchange markets, assuring the investors that the ventures were safe and would be profitable “from day one.”
In reality, the complaint said, NovaTech’s principals, Cynthia and Eddy Petion, skimmed millions of dollars of investors’ assets and used most of the rest to make payments to other investors and for commissions to marketers promoting the scheme. Little was actually invested, according to the complaint, and when NovaTech collapsed in 2023 under scrutiny from regulators in the United States and Canada, most investors learned their funds were lost.
In August, the SEC sued NovaTech, the Petions and six promoters in the Southern District of Florida, where the Petions lived before moving to Panama, according to court records. In a Nov. 27 status report to the court, the SEC said it was pursuing service of the couple through Panamanian authorities but, as of that date, had not been successful.
The NovaTech investigation was led by Catherine Rowsey and Todd Baker, attorneys in the SEC’s Fort Worth office. Patrick Disbennett of the Fort Worth office is representing the SEC in the suit, under the guidance of regional trial counsel Keefe Bernstein.
The case number in the Southern District of Florida is 1:24-cv-23058.
3. Owner of Houston Labs Pleads Guilty in Genetic-Testing Scam
In July, the owner of two Houston-area labs pleaded guilty to billing Medicare $359 million for performing useless genetic tests — work steered his way by a South Florida medical consultant to whom he paid at least $7.6 million in bribes and kickbacks.
Harold Albert “Al” Knowles cut a deal with the government a month after he and the consultant, Chantal Swart, were indicted together on federal charges of conspiracy to commit healthcare fraud, conspiracy to defraud the United States and receipt of healthcare kickbacks.
The criminal case against Swart is still pending. Trial is set for July before U.S. District Judge David Hittner.
According to the indictment, Knowles paid kickbacks to Swart — disguised as payments to her consulting company for marketing services — in exchange for her supplying his labs with Medicare beneficiaries’ DNA samples and signed doctors’ orders for genetic testing.
Knowles then billed Medicare for the lab work, the indictment said.
Swart, the indictment said, paid off telemedicine companies whose doctors signed orders for genetic testing of patients they barely knew. She and Knowles knew the results of those tests would “rarely, if ever” be used in the treatment of those patients, the indictment said, but Knowles billed Medicare for them nonetheless.
Additionally, the indictment said, Swart used “deceptive telemarketing campaigns” to reach tens of thousands of Medicare beneficiaries across the country. Call-center workers — “who were almost never medical professionals” — would try to get beneficiaries to discuss their medical conditions, then talk them into signing up for genetic testing, “regardless of medical necessity.”
The terms of Knowles’s plea agreement are secret, at least for now; the document is under court seal. But the indictment of Swart and Knowles makes it clear that many others were involved in what authorities believe was a massive grift, and it seems likely that Knowles knows what many of them were up to.
The indictment of Knowles and Swart was one of scores that stemmed from the Justice Department’s 2024 National Health Care Fraud Enforcement Action, an intense, two-week sweep in June undertaken in cooperation with investigators from the Department of Health and Human Services, the Department of Homeland Security, the U.S. Drug Enforcement Administration, state attorneys general and other law-enforcement agencies.
As a result of the coast-to-coast initiative, Attorney General Merrick Garland said, 193 defendants — including 76 doctors, nurse practitioners and other licensed medical professionals — were charged with participating in assorted scams to rob the healthcare system of a collective $2.75 billion.
According to court records, Swart’s lead attorney is Jimmy Ardoin of Bellaire, Texas. Knowles is represented by the federal public defender’s office in Houston.
The prosecutors are DOJ trial lawyers Andrew Tamayo and Monica Cooper of Houston.
The case number in the Southern District of Texas is 4:24-cr-00340
4. SEC Charges 17 in Houston-based Crypto Ponzi Scheme
In another crypto fraud case brought by the SEC, this one in the Southern District of Texas, 17 people were charged with taking part in a $300 million Ponzi scheme that targeted Latino investors.
According to the SEC’s March 14 complaint, CryptoFX, a Houston-based company that promoted itself as an investment firm trading in crypto-asset and foreign-exchange markets, raised money from 40,000 investors in the United States and elsewhere between May 2020 and September 2022, when the SEC put CryptoFX out of business and charged its founder, Mauricio Chavez, and his right-hand man, Giorgio Benvenuto, with violating anti-fraud and securities-registration laws.
Both were permanently barred from the securities business and ordered to disgorge ill-gotten gains and to pay civil penalties.
Investors were told to expect returns of up to 100 percent on the money they placed with CryptoFX. However, the company “used substantially all investor money” to keep a Ponzi scheme afloat, using new investments to pay fake returns to previous investors; to pay sales commissions; and to cover personal purchases by company executives.
The individuals charged in the new complaint were leading salespeople with CryptoFX who “engaged in unregistered offers and sales … and acted as unregistered brokers” by soliciting investors for Chavez, often with promises of preposterously lavish returns. For their efforts, the complaint says, the salespeople collectively raked in more than $5 million.
The SEC’s investigation was led by Jill Harris, formerly an attorney in the agency’s Fort Worth office and now enforcement counsel to SEC Commissioner Jaime Lizárraga, and Carol Hahn, a staff accountant in the Fort Worth office.
The litigation is being conducted by Matthew Gulde, an SEC attorney in Fort Worth.
According to court records, the defendants are represented by, among others, Gene Antone Watkins of Sherman Watkins in Houston.
The case number in the Southern District is 4:24-cv-00939
5. Judge Rejects Boeing’s Plea Deal in 737 Max Criminal Case
Earlier this month, U.S. District Judge Reed O’Connor rejected a plea agreement with the government under which the Boeing Co. would have paid a fine of $243.6 million to resolve a criminal conspiracy charge for misleading regulators about its 737 Max, the aerospace giant’s star-crossed jetliner. Two of the planes crashed, in 2018 and 2019, respectively, killing 346 people.
Judge O’Connor questioned several aspects of the plea bargain, arrived at by prosecutors and Boeing’s attorneys in July. In particular, he focused on details of a provision calling for an independent monitor to oversee Boeing’s compliance with anti-fraud laws over a three-year probationary period. In a Dec. 5 written order, the judge said he worried that the agreement “requires the parties to consider race when hiring the independent monitor” in keeping with the Justice Department’s “commitment to diversity and inclusion.” He said he was “not convinced … the government will not choose a monitor without race-based considerations,” adding that DEI policies “only serve to undermine this confidence in the government and Boeing’s ethics and anti-fraud efforts.”
He gave the two sides until Jan. 4 to update the court on how they plan to proceed with the criminal case, after soliciting comments from families of crash victims. Many of those families criticized the proposed plea bargain as too lenient, characterizing it as a “get-out-of-jail-free card” for the aircraft manufacturer.
The proposed plea deal described the fine Boeing would be required to pay as a maximum of $487.2 million but stipulated that the company would be credited for $243.6 million previously paid under a related agreement with the government.
In addition, Boeing would have pledged under the plea bargain to invest $455 million in compliance and safety programs.
According to court records, Boeing is represented in the criminal case by, among others, Ian Brinton Hatch and Jeremy A. Fielding of Kirkland & Ellis in Dallas; Michael P. Heiskell of Johnson Vaughn & Heiskell in Fort Worth.
Crash victims’ survivors are represented as movants by, among others, Warren T. Burns, Chase Thomas Hilton, Darren P. Nicholson and Kyle Kilpatrick Oxford of Burns Charest in Dallas.
The lead attorney for the government is Chad Meacham of the U.S. attorney’s office in Dallas.
The case number in the Northern District is 4:21-cr-00005.
6. Owner of Houston Pharmacies Guilty of Billing Medicare for Phony-Prescription
In October, the owner of a Houston company that controlled 14 pharmacies was convicted of swindling Medicare out of $160 million, largely by illegally buying personal information on thousands of patients then using it to dupe doctors into writing prescriptions for those patients.
Mohamed Mokbel was found guilty by a jury in the court of U.S. District Court Judge Lee H. Rosenthal of 15 counts of conspiracy, fraud, bribery and related charges. His sentencing is scheduled for March 19.
During a 10-day trial, jurors heard testimony that Mokbel paid an accomplice to provide purloined information on thousands of Medicare patients — names, birth dates, Social Security numbers, Medicare ID numbers and contact information for their doctors. Using the data, Mokbel’s employees faxed prefilled prescription requests to doctors, falsely claiming their patients had requested that their prescriptions be filled through one of Mokbel’s pharmacies.
“Many doctors apparently took the representations in the fax at face value and did sign and send back the prefilled requests,” said an August 2024 superseding indictment of Mokbel. He was originally indicted in March 2021. To maximize his revenue from the scam, the indictment said, Mokbel directed employees to run “test” claims using patients’ stolen data to see which medications brought high rates of reimbursement from Medicare and other insurers and which weren’t covered at all.
Court records identify his lawyers as Charles Flood of Houston and John D. Cline of San Francisco.
The prosecutors are Kathryn Olson, Adam Laurence Goldman, and Kristine E. Rollinson from the U.S. attorney’s office in Houston.
The case number in the Southern District is 4:21-cr-00103.
7. Nanotechnology Firm Charged with Rigging Stock Offering
An investigation by the SEC’s Fort Worth regional office resulted in market-manipulation charges filed in June against Meta Materials Inc., a nanotechnology company, and its former CEOs, John Brda and George Palikaras.
The SEC alleged that as a result of a concerted manipulation scheme by Brda and Palikaras, Meta Materials raised $137.5 million from investors in an at-the-market offering in June 2021 — just before Brda’s Torchlight Energy Resources Inc. and Palikaras’ Metamaterial Inc. merged to form Meta Materials.
The SEC’s complaint said Brda and Palikaras arranged for the issuance of a preferred stock dividend immediately before the merger and then told certain investors and consultants the dividend would force short sellers to exit their positions and trigger a “short squeeze,” which would artificially raise the price of the company’s common stock.
In addition, the SEC said, Brda and Palikaras misrepresented the company’s efforts to sell its oil and gas assets and distribute the proceeds to preferred stockholders, giving investors a false impression of the value of the dividend. While investors held or bought the company’s common stock to receive the dividend, the complaint said, Brda and Palikaras cashed in, raising the $137.5 million by selling shares at prices they knew were inflated by their manipulative scheme.
After agreeing to settle the SEC charges administratively, Meta Materials on Aug. 9 locked the doors of its headquarters in Nova Scotia and filed for Chapter 7 bankruptcy.
The SEC’s civil suit against Brda and Palikaras, originally filed in the Southern District of New York, was transferred last month to the Eastern District of Texas and assigned to Judge Sean D. Jordan.
According to court records, Palikaras is represented by Jessica Magee of Holland & Knight in Dallas.
Brda is represented by Jason Hopkins and Jason S. Lewis from the Dallas office of DLA Piper and Steven M. Rosato from the firm’s New York office.
The SEC’s investigation was conducted by Christopher Rogers and Ty Martinez of the agency’s Fort Worth office. Patrick Disbennett, also from Fort Worth, is in charge of the litigation.
The case number in the Eastern District of Texas is 4:24-cv-01048.
8. Fort Sam Houston Employee Gets 15 Years for Youth-Grants Rip-Off
In July, a former Army civilian financial manager was sentenced to 15 years in prison for stealing $109 million from a grant program that enables children of military members to participate in 4-H youth development activities.
Janet Yamanaka Mello, a longtime Army employee at Fort Sam Houston in San Antonio, was indicted in December 2023 on mail fraud and identity theft charges after investigators discovered that a phony business she created had been receiving grants from the 4-H Military Partnership for six years. She pleaded guilty in March before U.S. District Judge Xavier Rodriguez.
The partnership, financed by the Army, Navy and Air Force, awards grants to organizations that provide 4-H “experiential learning” activities for children of military families.
As a financial program manager for the Army’s Child & Youth Service at Fort Sam Houston, part of Mello’s job was to process applications for grants from the 4-H partnership and submit them to her supervisor for approval.
In 2016, her indictment said, she created a shell company called “Child Health and Youth Lifelong Development.” Its sole purpose, according to the indictment, was to apply for 4-H partnership grants. In her job capacity, Mello favorably reviewed the applications, which were then routinely approved; she “played on the trust she had developed over the years with her supervisors and co-workers,” the indictment said.
In all, her shell company received 49 grants over six years, totaling more than $108,900,000, according to court records.
“Rather than $109 million in federal funds going to the care of military children throughout the world, she selfishly stole that money to buy extravagant houses, more than 80 vehicles and over 1,500 pieces of jewelry,” said Jaime Esparza, U.S. attorney for the Western District of Texas. “Her actions reflect exactly the opposite of what it means to serve your country.”
Mello’s attorney was Albert A. Flores of San Antonio.
The case was prosecuted by Assistant U.S. Attorneys Justin Simmons, Antonio Franco, Kristy Callahan, Todd Keagle and Steven Seward.
The case number in the Western District of Texas is 5:23-cr-00620
9. Cardiac Scan Operator Accused of Paying Doctors for Referrals
In February, the Department of Justice filed a civil complaint in Houston accusing the former president of a company that provides mobile cardiac scans of paying “exorbitant” fees to doctors who referred patients, including Medicare patients, to the company for scans.
The complaint said Rick Nassenstein paid doctors $500 for each patient they sent to his company, Cardiac Imaging Inc., for a positron emission tomography (PET) scan, a noninvasive imaging test that can detect heart problems.
The payments “ostensibly” were compensation for doctors’ supervising the scans, the complaint said. But, as Nassenstein knew, doctors didn’t have to be present for the scan, weren’t involved in overseeing the procedure “and did not have to interrupt their ordinary practice of medicine,” the complaint said.
“Instead, what CII required and what physicians actually did was remain available in the event of an emergency — akin to an ‘on-call’ arrangement common in medicine.”
Between 2017 and June 2023, the complaint said, CCI “paid over $40 million in these illegal fees to physicians” and “submitted over 75,000 false claims to Medicare.”
The complaint said Medicare “paid at least tens of millions of dollars in false claims” but gave no specific figure.
However, in a related case, CII and its current owner and CEO, Sam Kancherlapalli (Nassenstein’s former business partner), agreed in October 2023 to pay $85.4 million to settle similar DOJ allegations involving $500 payments to doctors. That complaint did cover a longer time period — March 2014 through May 2023 — than the current one.
The government is seeking unspecified damages “to be determined at trial,” including treble damages and civil penalties on two causes of action accusing Nassenstein of violating the False Claims Act.
Originally, Nassenstein, Kancherlapalli and CII were sued by Lynda Pinto, a former billing manager at the company, under the qui tam or whistleblower provisions of the False Claims Act. Under the act, private parties, known as relators, can file an action on behalf of the United States and receive a portion of any recovery. The act permits the United States to intervene and take over the action, as it has done here.
According to court records, Nassenstein is represented by Brian Dickerson and Casey H. Cusick of Naples, Florida.
The government is represented by Melissa M. Green, an assistant U.S. attorney in Houston, and Samuel R. Lehman and Jake M. Shields, Justice Department trial attorneys in Washington, D.C.
Pinto is represented as relator by Caitlyn Silhan and Charles S. Siegel of Waters Kraus Paul & Siegel in Dallas.
The case number in the Southern District is 4:18-cv-02674
10. Doctor, 2 Others Await Trial in Injured Student-Athlete Case
Four people, including two physicians, were indicted in the Eastern District of Texas in connection with what the government called a scheme to bill insurance companies for the treatment of injured college athletes when no treatment was provided.
Additionally, three of the four, including one doctor, were accused of billing the government for thousands of COVID-19 tests the doctor never performed.
Collectively, authorities said, the defendants collected more than $70 million from the two subterfuges, money they used to pay themselves millions of dollars and to buy real estate — including a mansion in Highland Park, an estate in Mexico and a lake house in Oklahoma — and a yacht.
One of the four, Dr. Kyle Carter of Keller, Texas, indicted only in connection with injured-athlete billings, was acquitted in August by a jury in the court of U.S. District Judge Amos L. Mazzant III in Sherman.
The other three, Mouzon “Muzzy” Bass III of Highland Park, Lance West Wilson of Allen and Dr. Robert Brent Scott of La Quinta, California, are awaiting trial.
According to court records, Carter was represented by Arianna Goodman, Jeffrey J. Ansley, Samuel M. Deau, and Katherine Devlin of Vedder Price in Dallas.
His case number in the Eastern District is 4:23-cr-00225.
Bass is represented by Scott Thomas, Tom Melsheimer and Alexander Nowakowski of Winston & Strawn in Dallas.
Wilson is represented by Arnold Spencer of Fort Worth.
Scott is represented by Gene Besen and Stephen Moulton in the Dallas office of Bradley Arant Boult Cummings; Scarlett Nokes of Bradley’s Nashville office; and Ryan Dean of Katten Muchin Rosenman of Dallas.
The case number for Bass, Wilson and Scott in the Eastern District is 4:24-cr-0007.
Anand Varadarajan, an assistant U.S. attorney in Plano, tried Carter before Judge Mazzant and heads the prosecution of Bass, Wilson and Scott.