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Full text of "Report of the Attorney General for the year ending .."

Public Document 



No. 18002 



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REPORT 



OF THE 



ATTORNEY GENERAL co 



FOR THE 



Year Ending June 30, 1996 




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Printed on Recycled Paper 

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COMMONWEALTH OF MASSACHUSETTS 

In accordance with the provisions of Section 1 1 of Chapter 12 of the General Laws, I 
hereby submit the Annual Report for the Office of he Attorney General. This Annual Report 
covers the period from July 1, 1995 to June 30, 1996. 



Respectfully Submitted, 

Scott Harshbarger 
Attorney General 



Words of Remembrance for Assistant Attorney General Paul R. McLaughlin 

Delivered by Attorney General Scott Harshbarger 

5/. Theresa ofAvila Church, West Roxbury 

September 30, 1995 

One of my heroes -- one of our heroes -- died Monday night. 

As it turns out, he was also my friend of 16 years, a loyal prosecutor for me since 1983, a 
democratic citizen and public servant in the truest sense. But above all, Paul McLaughlin was a 
role model. He lived his life for others. He was a gendeman who was also a genUe man. Paul was 
also the hero Reinhold Niebuhr described as a moral man struggling for justice in our immoral 
society. 

He was a hero. 

Ed and Cis, Ted, Bob, Ricky, Lisa and so many friends of Paul McLaughlin, 
distinguished guests: I am honored to join Ralph Martin in speaking this morning on behalf of all 
of you. Each of you -- the hundreds who are here whose life Paul touched -- could speak 
eloquendy about your memories and your pain. So I hope you will join me, albeit in silence, and 
recall your memories of Paul as I offer you mine. 

Maybe together we can somehow capture some of the essence of Paul as a person, a 
citizen and a public servant. 

Paul was a very private person. He had a wide smile, a quick walk, a self-deprecating wit, 
tremendous personal energy and very strong convictions. But he also had a unique ability to 
listen and to get us to talk about ourselves or our concerns without asking anything for himself in 
return. 

Paul was meticulous. Who else, in just one month this summer, could have summarized 
in interesting but precise paragraphs every single one of the 149 cases he had prosecuted for me 
in the past four and a half years? 



Who else could have had all of the 60,000 "Dear Friend" cards for the Harshbarger 
campaign chronicled, filed and prepared in bags for bulk mailing by zip code two full weeks 
before the 1982 primary? 

Paul was careful. Who else could drive from Lowell to Holliston on Route 495 with little 
time to spare and remain steadfastly at 50 miles per hour, believing you should stay just below 
the speed limit no matter what? 

Paul was honest and fair. He was the anti-thesis of the hardbitten prosecutor. When he 
served as an assistant district attorney in Cambridge, judges often quietly dispatched court 
officers to find him and ask if he would help defendants who had appeared without counsel. They 
knew Paul's only goal was to seek justice. 

Paul was tenacious. He came with me to the Attorney General's Office to be one of the 
founding prosecutors of the Urban Violence Strike Force. The creation of the Safe Neighborhood 
Initiative was slow and painstaking, but Paul passed on opportunities to try major white-collar 
cases or to enter private practice. 

Thoreau spoke of lives led in quiet desperation. Paul led a life of quiet inspiration. No 
assistant I have ever been associated with in my years as a prosecutor tried more cases. And no 
one has been more successful, sensitive or ethical. 

Yet, his greatest inner skill, I think, was that of being a friend. The friendship he shared 
was a treasured gift to us instilled in him by his loving parents and family. And for that, we thank 
them from the bottom of our hearts. 

Paul was also a true democratic citizen. He had a profound understanding that democracy 
is not a birthright, but must be nurtured and guarded. He really seemed to consider citizenship an 
office. And because he believed democracy cried out for action and justice, Paul loved the law 
and he loved politics. 

His work in both fields was not the stuff of bells and whistle, headlines, balloon drops or 
bumpersticker cliches. To him, true democracy was the basics - exercising individual 
responsibility, putting talents to use for society, protecting the poor and the powerless, getting out 
the vote, supporting candidates you believed in, being loyal to friends, fighting fair. 



His own run for office was probably one of his greatest internal contradictions. Here was 
a quiet, painfully shy person whose inner flame burned so bright that he felt the need to get up on 
the political stage at a time when few others cared. 

Yet, at the same time, I will be forever in his debt for all the things he did for me. Like 
many others here this morning, I know that I hold the office I do because of Paul's belief in 
democracy. Without Paul McLaughlin at his side, how else could a guy named Harshbarger win 
Ward 20 in West Roxbury? And yet, with all I owed him, Paul asked only that he be allowed to 
be a public prosecutor in urban courts. 

Ultimately, it was Paul's life in the law, as a public prosecutor, that will forever define 
him for so many of us gathered here today. Paul, in this way, blended his personal values and his 
professional skills. 

He became an assistant district attorney for one very simple reason: He wanted to make 
our neighborhoods safer. He was a peaceful man who wanted peace in the streets. He did not 
want to get the bad guys as much as he wanted to protect the good guys. 

It is important to understand that Paul chose to do what he did. He chose to prosecute the 
kind of nitty-gritty, unpublicized cases that make up 99 percent of the crimes that occur in our 
Commonwealth. He chose to be in the community courts, in the urban courts, where the 
Constitution is really played out everyday — where, for the vast majority of victims, police 
officers, defendants and the community, justice is done or not done everyday. 

Paul believed every neighborhood in this city and in this state could be like his beloved 
neighborhood of West Roxbury -- places for families, for workers, for children, for the elderly; 
places for the unsung among us to rest. People had a right to that and, as a prosecutor, Paul tried 
to make that right a reality. 

In the last two and a half years of his life, Paul surely must have had a great sense of 
satisfaction. With Marcy Jackson, Captain Dunford and, more importantly, with the SNI 
residents, his work was truly making a difference in North Dorchester. Without headlines or 
fanfare, he was realizing the dream of every public prosecutor. He was getting at the causes of 
crime and violence, instead of dealing only with the tragedies at the end of the line. 



He was happy seeing the changes he was making in the quality of people's lives. Crime 
was dropping; neighbors were taking back their streets; new businesses were starting. A sense of 
community was being revived. But there were still too many victims and, in one tragic act 
Monday night, Paul became one too. 

God was in Paul, but Paul was, after all, only human. But he was a great human, and it is 
in that knowledge that I find some comfort in the words of the Beatitudes, in which Jesus defines 
the characteristics of greatness — the characteristics that were Paul: 

"Blessed are the meek, (the kind and the gentle), for they shall inherit the earth; Blessed 
are those who hunger and thirst for righteousness, for they shall be satisfied; Blessed are the 
merciful, for they shall obtain mercy; Blessed are the pure of heart, for they shall see God; 
Blessed are the peacemakers, for they shall be called the sons of God." 

If there is a lesson or challenge that we can take from this tragedy, I believe it can be 
found in Paul's life — not in his death only a few blocks from here. It is a lesson best captured by 
the poetic, ancient words of Matthew 5:14: 

"You are the light of the world. A city set on a hill cannot be hid. Nor do man light a 
lamp and put it under a bushel, but on a stand and it gives a light to all in the house. Let your 
light so shine before men that they may see your good works and give glory to your father who is 
in heaven." 

Paul McLaughlin's light shone bright everyday of his life. We saw it. We still feel its 
warmth. Let Paul's light inspire us to go forth with renewed dedication to public service, to the 
common weal and to the common good. Let his light shine in each of our actions, day in and day 
out, one person and one neighborhood at a time. 

If we do not, the forces of darkness will claim the victory that Paul McLaughlin, a hero 
for our city and our state, was determined never to allow them to savor. If we let his light shine in 
us, if we all carry his life and memory in us in all we do, Paul will never die. He will live on in 
each of us, and his light will forever burn in our hearts, our minds and our lives. 



OFFICE OF THE ATTORNEY GENERAL 



ATTORNEY GENERAL 
SCOTT HARSHBARGER 



FIRST ASSISTANT ATTORNEY GENERAL 
Thomas H. Green 



CHIEF OF STAFF 
Donald L. Davenport 



Assistant Attorneys General : 



Jonathan Abbott 
Richard Allen 
Dorothy Anderson 
Barbara Anthony 
Luz Arevalo 
Frederick Augenstern 
Lori Balboni 21 
Thomas Barnico 
Jason Barshak 9 
Judith Beals 
Thomas Bean 
John Beling 69 
John Benzan 
Steven Berenson 58 
Jean Berke 53 
Anne Berlin 
Edward Berlin 



Cynthia Berliner 
William Berman 
Ann Berwick 69 
John Bigelow 
Crispin Birnbaum 
Edward Bohlen 
Barbara Boden 
John Bowen 
John Bowman 
Kevin Brekka 
Douglas Brown 
William Brownsberger 
James Bryant 64 
Brian Burke 
David Burns 
Eric Carriker 
James Caruso, Jr. 



R. Michael Cassidy 

Pamela Castrucci 1 1 

John Ciardi 

Peter Clark 

Jeffrey Clements 14 

Edward Colbert 

Richard Cole 

Joanna Connolly 

Scott Cooper 

Pierce Cray 

Phyllis Crockett Gallagher 

Michael Cullen 

Maurice Cunningham 

William Daggett 

Leslie Davies 

Ed DeAngelo 

George Dean 



Linda DelCastilho 4 
Stephen Dick 
Carol Dietz 50 
Michael Dingle 
Elizabeth DiTomassi 
J. Leib Dodell 
William Duensing 
Deborah Ecker 
Stanley Eichner 
Judith Fabricant 
Barbara Fain 
Jennifer Ferreira 
Freda Fishman 
Francis Flaherty, Jr. 
Elizabeth Ann Foley 
Mary Freeley 
Cynthia Gagne 
Rosemary Gale 
Rosalyn Garbose 
Susan Gilfix 
Salvatore Giorlandino 
I. Andrew Goldberg 
Richard Gordon 
Tania Gray 60 
Thomas Green 
Leslie Greer 
Mary Griffin 
John Grossman 7 
Irene Guild 
Kristin Guyot 55 



Daniel Hammond 
Charles Harak 1 
Nancy Harper 
Sarah Hartry 
Katherine Hatch 
Bennet Heart 
Michael Hering 
Philip Holmes 
Audrey Huang 
Amy Hudspeth 
Pamela Hunt 
Marsha Hunter 
Marcia Jackson 
Diane Juliar 
Michelle Kaczynski 
Judy Zeprun Kalman 16 
Susan Kang 
Glenn Kaplan 
Sean Kealy 
Margaret Kelley 20 
Stephanie Kelly 
Carolyn Keshian 
Rosa Kim 7 
Michael Kogut 62 
Pamela Kogut 
Pablo Landrau 63 
Karen Laufer 
Andrew Lawlor 5 
Ellyn Lazar 
MacyLee 



William Lee 
Judy Levenson 72 
Martin Levin 
Darlene Luccio 1 8 
Kara Lucciola 2 
Anita Maietta 
David Marks 12 
William Matlack 
Laura Maslow-Armand 
Gregory Massing 
Thomas McCormick 
Walter McDonough 53 
Karen McGuire 
Kristin Mcintosh 
Gail McKenna 
Beth McLaughlin 14 
Paul McLaughlin 
William Meade 
Marianne Meacham 
Elizabeth Medvedow 
Joyce Meiklejohn 
Howard Meshnick 
Nicholas Messuri 
Holley Meyer 
James Milkey 3 
Daniel Mitchell 
Helen MoresChi 19 
Christopher Morog 
Madelyn Morris 
Susan Motika 



Mark Muldoon 
Robert Munnelly 67 
Kathryn Murphy 56 
Linda Murphy 
Mary Murphy-Hensley 6 
Alexander Nappan 71 
Kevin Nasca 
Paula Fox Niziak 
Jean O'Brien 
Michelle O'Brien 
Thomas O'Brien 
Donna Palermino 
William Pardee 
Margaret Parks 
Stephen Paterniti 22 
Robert Patten 
Anthony Penski 
Djuna Perkins 
Mary Phillips 
William Porter 
Cristina Poulter 51 
Anne Powers 
Frank Pozniak 
Edward Rapacki 68 
Carol Lee Rawn 59 
Elizabeth Reinhardt 
Shelley Richmond 
Benjamin Robbins 
Beverly Roby 
Anthony Rodriguez 



Joseph Rogers 
Deirdre Rosenberg 
Nina Ross 66 
Stuart Rossman 
Peter Sacks 
E. Selena Samm 7 
Ernest Sarason, Jr. 
Pasqua Scibelli 
Arlie Scott 
Sharon Scott 13 
Robert Sikellis 
Jeremy Silverfine 
Eleanor Sinnott 54 
Eric Smith 52 
Joanne Smith 
Loretta Smith 17 
Mark Smith 
Johanna Soris 
Leo Sorokin 
Amy Spector 
Susan Spurlock 
Marie St. Fleur 
Carol Starkey 
James Stetson 
Deborah Steenland 
Walter Sullivan 
Mark SutlifF 
James Sweeney 
Diane Szafarowicz 
Pamela Talbot 



Rosemary Tarantino 
Neil Tassel 
Shelly Taylor 
Jane Tewksbury 
Steven Thomas 8 
Jean Thompson 
Edward Toro 70 
Bruce Trager 
Margaret Van Deusen 
Gina Walcott 
Lucy Wall 
Beverly Ward 
Rebecca Webb 59 
George Weber 
Mark Weber 
Joseph Whalen, JU 
James Whitcomb 
Douglas Wilkins 
Jane Willoughby 
Howard Wise 
John Woodruff 
Chi Chi Wu 23 
Edward Wu 10 
Norah Wylie 
Kristine McMahon 
Yanofsky 57 
Judith Yogman 
Andrew Zaikis 61 
Catherine Ziehl 
Michael Zullas 



Assistant Attorneys General Assigned To The Department of Employment & Training: 

David Breen 18 
Stacey Bloom 
Brian Burke 
Joshua Krell 
Philip McGovern 15 
Glenn MacKinlay 
Patricia Preziosa 
Michelle Fontana 65 



APPOINTMENT DATE 



1. 


07/03/95 


2. 


07/05/95 


3. 


07/13/95 


4. 


07/31/95 


5. 


08/14/95 


6. 


09/13/95 


7. 


09/18/95 


8. 


09/26/95 


9. 


10/02/95 


10. 


10/23/95 


11. 


11/01/95 


12. 


11/19/95 


13. 


12/11/95 


14. 


03/19/96 


15. 


03/25/96 


16. 


04/16/96 


17. 


04/22/96 


18. 


05/06/96 


19. 


05/12/96 


20. 


05/28/96 


21. 


06/03/96 


22. 


06/10/96 


23. 


06/18/96 



TERMINATION DATE 



50. 


08/15/95 


51. 


08/16/95 


52. 


08/18/95 


53. 


08/31/95 


54. 


10/09/95 


55. 


10/18/95 


56. 


11/17/95 


57. 


12/12/95 


58. 


12/14/95 


59. 


12/15/95 


60. 


12/29/95 


61. 


01/08/96 


62. 


01/15/96 


63. 


02/23/96 


64. 


02/25/96 


65. 


03/01/96 


66. 


03/29/96 


67. 


04/19/96 


68. 


05/03/96 


69. 


05/17/96 


70. 


05/27/96 


71. 


05/31/96 


72. 


06/08/96 


73. 


06/25/96 



10 



DEPARTMENT OF THE ATTORNY GENERAL 
TRUSTS RECEIPTS AND DISURSEMENTS 



Account 

08100033 
08100034 

08100036 

08100037 

08100038 

08100301 

08100414 
08100415 
08100416 

08100444 

08100526 

08106614 
08106656 

GRAND TOTAL 



Account Name 


Appropriation 


Expenditures 


Balance 


Local Consumer Aid fund 


$1,593,339.78 


$1,164,421.55 


$428,918.23 


Student Conflict Resolution Experts 


; $157,1 17.28 


$235.00 


$156,882.28 


SCORE Adminatration 








Merger Central Mass Health Care,. 


$50,000.00 


$49,978.86 


$21.14 


Inc. and Healthcare, Inc 








Merger Metrowest Medical Center 


$70,000.00 


$70,000.00 


$0.00 


and Columbia/HCA Healthcare Corp. 






Fallon Healthcare/Ornda 


$125,000.00 


$110,000.00 


$15,000.00 


Health Care 








Bluecross/Blueshield tobacco 


$601,000.00 


$8,832.02 


$592,167.98 


Litigation (MGL C. 125 4A) 


I 






Forfeired Funds (Ch 94 C, S.17) 


$171,717.00 


$146,554.62 


$25,162.38 


Expendable Trust (Ch. 12,S.4a,6A) 


$82,281.59 


$0.00 


$82,281.59 


conference and Training 


$93,671.28 


$48,917.26 


$44,754.02 


(Ch. 12, s.4a, 6a) 








Forfeited Funds-Federal 


$126,390.07 


$121,006.01 


$5,384.06 


Equitable Sharing 








Art. Gen. Unclaimed 


$1,275,974.83 


$1,024,292.82 


$251,682.01 


Minimum Wage Claims 








Attorney General Trust Fund 


$80,732.18 


$0.00 


$80,732.18 


Ford Foundation Grant (SCORE) 


$84,954.00 


$36,004.34 


$48,949.66 




$4,512,178.01 


$2,780,242.48 


$1,731,935.5 



11 



DEPARTMENT OF THE ATTORNEY GENERAL 
STATEMENT OF THE FINANCIAL POSITION 



Account 


Account Name 


Appropriation 


Expenditures 


Balance 


0810-0000 


Administration 


$13,901,256.00 


$13,854,907.52 


$46,348.48 


0810-0014 


Public Utilities Auth. by 
Ch. 1221 1973 


$1,335,209.00 


$1,322,334.03 


$12,874.97 


0810-0017 


Judicial Proceedings Relevant 
to the fuel charges 


$75,000.00 


$68,160.00 


$6,840.00 


0810-0021 


Medicaid Fraud Control Unit 


$1,263,151.00 


$1,245,844.14 


$17,306.86 


0810-0031 


Local Consumer Aid Fund 


$598,499.00 


$598,451.80 


$47.20 


0810-0035 


Anti-Trust Division Administraition $318,828.00 


$318,736.05 


$91.95 


0810-0045 


The Wage Enforcement Program 


$2,457,773.00 


$2,441,142.21 


$16,630.79 


0810-0201 


Insurance Auth. by Ch. 266, 1976 


$1,145,253.00 


$1,130,361.95 


$14,891.05 


0810-0338 


Auto Insurance Fraud by 
Ch. 338, 1990 


$200,000.00 


$198,965.64 


$1,034.36 


0810-0399 


Workers' Comp. Fraud by 
Ch. 399, 1991 


$368,602.00 


$362,822.61 


$5,779.39 


0810-1031 


Victim/Witness Assistance 


$117,499.00 


$117,425.60 


$73.40 


0830-0100 


Comm on Uniform State 
Laws, Admin. & Expenses 


$27,900.00 


$27,894.18 


$5.82 


GRAND TOTAL 


$21,808,970.00 


$21,687,045.73 


$121,924.2: 



12 



DEPARTMENT OF THE ATTORNEY GENERAL 

INTERDEPARTMENTAL FUNDS AND FEDERAL GRANTS 

STATEMENT OF THE FINANCIAL POSITION 



$61,233.46 

$6,759.88 
$2,339.14 
$7,500.00 

$32,839.00 
$341,314.00 

$50,000.00 



Account Name 

Criminal Tax Unit Alloc, 
of 1201-0100 by Ch. 164, 
Acts of 88 

Stop Violence against 
Women Act (Alloc of 8600-0020) 
Student Conflict Resolution Experts $150,000.00 
Enforcement of Smoking Related 
Laws Alloc, of 4590-0300 
G.I.C. Benefit determinations 
Alloc, of 1108-5200 
Water Pollution Control Program 
Air Pollution Control Program 
Hazardous Waste Enforcement 
Alloc of 2200-9704 
08106652 Elder Abuse Alloc, of 8600-0009 

08 1 06654 SNI Commities First 

(Alloc, of 8600-0009) 

08 1 06655 SCORE Student Conflict 
Resolution Expert (Alloc. 8600-0009) 

08106661 Coastal Zone Mmgt. Prgm. $2,693.47 

Implmt. (CZMPI) 
08 107843 Asbestos Property Litigation $ 1 7,066.99 

Alloc, of 1102-7843 
08108817 NFA Project Litigation on Expenses $200,675.00 

Incurred by AGO (Alloc. 6033-8821) 

(88C15,91C33 
08109081 AGO Reimbursement for Legal Srv. $14,919.00 

to DET (Alloc. 9081-6624) 

081091 15 MHD Expenses Incurred by $478,923.00 
AGO Central Artery/tunnel 

C.33,'91 (Alloc 6033-91 15) 

081091 16 MHD Expenses Incurred by $314,712.00 

AGO Central Artery/Tunnel c.33,'91 
(Alloc 6033-91 16) 

08 1 09 1 1 7 MHD Expenses Incurred by 

AGONon Federal Aid Project 

C.33,'91 (Alloc 6033-9117) 
08 1 09707 Water Pollution Control 

Enforcement Activity 

(Alloc of 2240-9707) 
08 1 097 1 Air Pollution Control Prgm 

Enforcment (Alloc, of 2250-9710) 
GRAND TOTAL 



Appropiation 
$123,750.00 


Expenditures 

$123,750.00 


Balance 

$0.00 


$15,000.00 


$0.00 


$15,000.00 


$150,000.00 
$123,000.00 


$2,925.00 
$123,000.00 


$145,946.03 
$0.00 



$0.00 



$0.00 



$25,000.00 



$1,967,724.94 



$61,233.46 

$0.00 
$0.00 
$6,598.13 

$30,784.90 
$341,313.97 

$50,000.00 

$0.00 

$0.00 

$127,951.04 

$14,944.20 
$478,651.75 

$307,370.21 

$0.00 

$0.00 

$22.129.83 
$1,690,652.49 



$0.00 

$6,759.88 
$2,339.14 
$901.87 

$2,054.10 
$0.03 

$0.00 

$2,693.47 

$17,066.99 

$72,723.96 

($25.20) 
$271.25 

$7,341.79 

$0.00 

$0.00 

$2.870.17 
$275,943.48 



13 



DEPARTMENT OF THE ATTORNEY GENERAL 



SUSPENSE FUNDS 
RECEIPTS AND DISBURSEMENTS 



ACCOUNT NAME 
Century Auto Apprais Inc. R.P. 
Stone Jr. and Peter Slate 
Eric Bartlett D/B/A Bartlett Assoc, 
and Bartlett Financial Co. 
Bruce LedBury D/B/A Cars International LTD 
Vurhoe Insurance Restitution Account 
Andrews Painting Co. Inc. and F.G. 
Andrews, Indv. and President 
Barry Cushner D/B/A North Shore 
Roomates Services 
Diamond Chevrolet 
Rusty Jones Inc. 

Business Educational Services Inc. 
Marjorie and Fred Camp 
A.J. Long's Inc. d/B/A Economy Auto Sales 
Woman's World Health Spas of America Inc. 
Village Truck Sales Inc. and Joseph Szczepaniak 
Mario Chiereghio D/B/A Lee Auto sales 
William wolf 

Alan S. Miller/Furniture Outlet 
Tijuana Goldstein star, ET AL 
Ray's Auto Body 
Abrams ET AL Vs. Hertz Corp. 
Missions of Mercy , Inc. 
Outdoor World, Inc. 
European Health Spa 
Micheal Collins 
Joy of Movement 
Stephen J. Fovorito 
Craftmatic/contour ET AL 
Atlantic West 
Home Repair, Inc. ET AL 
Raymond A. Noyes 
Getty Petroleum 
Teknor Apex Co. Inc. 
Advanced Financial services, ET AL 
Robert Haynes Jr. and Sr. 
Nelly Gutierrez 
VIA Brazil, Inc. 

Roy Parkers D/B/A Shoppers Samplers 
Escape to Fitness Center 
Lee Imported Cars, Inc. 
California Fitness Inc. Kneidl 
Sunshine Daily Rentals, ET AL 
J.K. Liquidators, ET AL 
Eric Brill D/B/A Hollywood 
Model and Talent Showcase 
Lifetime Nutrition Inc., ET AL 
Diversified Resorts Inc. D/B/A Oak N' Spruce 
Autothrift Inc. and John Franceschini 
D/B/AAutothrift 
NNLC D/B/A Lectra City 
Lenox Oil Company Inc. 
George Muir D/B/A Journeys on Dialysis 



APPROPRIATION 


EXPENDITURES 


$6,800.00 


$0.00 


$200.00 


$0.00 


$11,286.60 


$0.00 


$0.00 


$0.00 


$0.00 


$0.00 


$1,088.39 


$0.00 


$7,396.00 


$0.00 


$2,263.00 


$0.00 


$88,982.46 


$3,115.19 


$7,136.00 


$0.00 


$20,000.00 


$0.00 


$68.82 


$0.00 


$3,302.00 


$0.00 


$517.55 


$0.00 


$466.24 


$0.00 


$2,032.21 


$0.00 


$23,500.00 


$0.00 


$4,584.02 


$0.00 


$1,865.00 


$0.00 


$16,474.31 


$0.00 


$1,322.78 


$0.00 


$1,375.98 


$0.00 


$1,540.60 


$1,540.60 


$52.38 


$0.00 


$14,911.60 


$14,911.60 


$1,728.75 


$0.00 


$20,295.55 


$0.00 


$0.92 


$0.00 


$2,500.00 


$0.00 


$75,000.00 


$0.00 


$349.00 


$0.00 


$7,023.21 


$7,023.21 


$89,309.12 


$0.00 


$3,270.00 


$0.00 


$15,000.00 


$0.00 


$2,200.00 


$0.00 


$75,000.00 


$68,750.00 


$10,044.44 


$10,043.44 


$5,200.00 


$0.00 


$3,150.00 


$0.00 


$110,188.00 


$109,923.61 


$4,425.00 


$4,425.00 


$125,437.91 


$8,235.00 


$25,584.00 


$0.00 


$7,000.00 


$7,000.00 


$19,035.84 


$14,828.98 


$5,000.00 


$0.00 



14 



Jorge Manuel Dias 

Richard Kivel Et AL Defendants 

08106999 Customized Structures Inc. James Dunlevy 

and Town and country Modular Homes 

08 1 07000 Paul E. Morrison 

08 1 0700 1 Mechem Financial of Mass Inc. CA 9 1 -3640 

08107002 Employment Network Inc. $3,775.29 

08107003 Distribution Assoc. D.A. Technology 

08 1 07004 Robert Presti and Studio One Kitchens 
GRAND TOTAL 



$3,331.40 


$0.00 


$3,331.40 


$500.00 


$499.48 


$0.52 


$1,800.00 


$0.00 


$1,800.00 


$32,500.00 


$32,500.00 


$0.00 


$100.00 


$100.00 


$0.00 


$3,775.29 


$0.00 




$5,500.00 


$5,500.00 


$0.00 


$10,710.74 


$10,710.74 


$0.00 


$882,125.11 


$302,882.14 


$581,042.97 



15 



16 



BUSINESS AND LABOR PROTECTION BUREAU 

Fiscal Year 1996 was the first complete year of operation by the Business and Labor Protection 
Bureau since its creation in April, 1995. The Bureau consists of the Division of Employment and 
Training, the Fair Labor & Business Practices Division, the Insurance Fraud Division and the Medicaid 
Fraud Control Unit. During this formative period the anticipated benefits of combining these four 
divisions as part of a separate, yet coordinated, Bureau began to be realized. 

Sharing common goals of eliminating fraudulent activities in the marketplace and establishing a 
level playing field in the economic sector for businesses and individuals alike resulted in better efficiency 
and productivity by each division. By tapping into the legal and investigative resources available from all 
of it divisions, each of which are experienced in the areas of fraud prosecution, the Bureau was able to 
maximize its overall impact and effectiveness in combating the "fraud tax" which unfairly increases the 
costs and expenses of honest businesses, insurance policy holders and tax payers in Massachusetts. 

The Bureau initiated its own in-house educational and training programs to supplement office- 
wide efforts with sessions and materials specifically geared to the types of cases assigned to its four 
divisions. A General Counsel was appointed to assist the Bureau Chief in adopting and implementing 
consistent legal policies and procedures throughout the Bureau. 

The number of inter-divisional investigations and prosecutions increased substantially, 
highlighted, among others, by the Bardzik (unemployment tax and workers compensation premium fraud); 
(S & S Concrete Floors and Companies, Inc.) (prevailing wage, unemployment tax and workers 
compensation premium fraud); and the Eastern Contractors (prevailing wage, unemployment tax and 
workers compensation premium fraud) cases featured in the following pages. 

The Bureau maintains its primary offices at 200 Portland Street, Boston and 165 Liberty Street in 
Springfield. 



17 



DIVISION OF EMPLOYMENT AND TRAINING 

The Division of Employment and Training is comprised of ten staff members: a chief, 
managing attorney, four assistant attorneys general, two investigators, an office manager, and an 
administrative assistant. Pursuant to its authority under Massachusetts General Laws chapter 
151 A, Section 42A, the Division enforces the provisions of the Massachusetts Employment 
Security Law. Actions involving employer tax fraud and larceny of unemployment benefits are 
prosecuted in the District and Superior Courts. 

While the Division primarily receives its referrals from the Department of Employment 

and Training ("DET"), it also generates its own independent actions. Through the utilization of 

resources in other divisions in the Business and Labor Protection Bureau, the Division targets 

complex and sophisticated schemes involving various combinations of employment security 

fraud, prevailing wage, and workers compensation violations. This interdisciplinary effort has 

been instrumental in the Division's investigation, and successful prosecution, of egregious 

violators. 

SIGNIFICANT ACTIVITIES 

EMPLOYMENT SECURITY FRAUD 

• Commonwealth v. Michael Bardzik - Middlesex Superior Court - Michael 

Bardzik, of Hollis, NH, president of Golden Labor Service, Inc., was 
convicted of 12 counts of failure to pay employer tax contributions, four 
counts of workers compensation fraud, and one count of a continuing 
scheme of larceny of property over $250. 

Bardzik was sentenced to 30 days committed in the Middlesex County 
House of Correction in Billerica on six of the employer tax contributions 
charges, to run concurrent with each other, plus $53,000 to be paid in 
restitution to DET; three-to-five years in MCI-Cedar Junction, suspended 
for six years, plus $91,000 to be paid in restitution to the Liberty Mutual 
Insurance Company on two of the workers compensation fraud charges; and 
30 days in the Middlesex County House of Correction, to be served 
concurrently with the employer tax contribution sentences, on the larceny 
charge. Sentencing on the remaining tax and workers compensation fraud 
charges was deferred during the pendency of the probationary period. 



18 



Golden Labor Service, which operated out of Lowell, primarily provided 
unskilled, temporary assembly and clerical workers to client companies in 
eastern Massachusetts. Bardzik knowingly misclassified these employees 
as independent contractors instead of as Golden Labor employees. As a 
result, Bardzik did not pay $21 1,201 in employer tax contributions for the 
12 quarters from April 1991, through June 1994. Bardzik also gave false 
information on the actual number of workers he employed to Liberty 
Mutual Insurance Company to avoid paying $473,947 in workers 
compensation premiums. 



Commonwealth v. S & C Concrete Floors & Company, Inc., Stephen Hill, 
and Christopher Hill - Middlesex Superior Court - Stephen Hill and 
Christopher Hill, both of Londonderry, NH, and their company, S & C 
Concrete Floors & Company, Inc., pled guilty to one count each of failure 
to pay the prevailing wage, and one count each of failing to provide true 
and accurate records and failure to keep true and accurate records. The Hill 
brothers, as the president and vice president of S & C, also pled guilty to 
four counts each of failure to provide workers compensation insurance, two 
counts each of unemployment fraud, and two counts each of larceny over 
$250. 



The Hills were sentenced to one year in the House of Correction, suspended 
for five years, and ordered to pay $25,049 in restitution and another 
$28,000 in fines. The company is obligated to pay an additional $14,000 in 
fines. All three defendants were barred from bidding on public works 
projects for six months. 

In separate, but related, actions, the Division also prosecuted five 
individuals who illegally received unemployment benefits while working 
for S & C Concrete. The defendants were charged with unemployment 
fraud in several district courts. Guilty findings were entered against all five 
defendants, along with orders of full restitution to DET. 



Commonwealth v. Ronald Pasqualino - Dedham District Court - Ronald 
Pasqualino, of Westwood, was charged with three counts of felony larceny 
for fraudulently collecting unemployment benefits under three identities. 
During the prosecution, Pasqualino alleged that he was incompetent to 
stand trial as he suffered from multiple personality disorder. After a two 
day competency hearing, the Court ruled that Pasqualino was competent to 
stand trial. Pasqualino subsequently pled guilty and was sentenced to 18 
months in the House of Correction on count one, to be served concurrent 
with an unrelated sentence he currently was serving; two years in the House 
of Correction, suspended for two years, on count two, to be served from 
and after count one; and, on count three, two years in the House of 
Correction, suspended for two years, to be served from and after count two, 
with restitution of $19,641 to be paid to DET. 



19 



Commonwealth v. Henry Son - Norfolk Superior Court - Henry Son, of 
Marshfield, pled guilty to three counts of larceny of unemployment funds 
and one count of perjury for defrauding DET of over $1 2,000 in 
unemployment benefits. The Commonwealth alleged that Son utilized 
three social security numbers and dates of birth to disguise his identity and 
collect the money from two DET offices between September 1989, and July 
1991. Son was sentenced to concurrent sentences of two and one-half years 
in the House of Correction, suspended for five years, on the three counts of 
larceny. Restitution was ordered in the amount of $12,167 to be paid to 
DET. On the perjury count, Son received a sentence of five years 
probation. 



Commonwealth v. Benilde Andrade - Boston Municipal Court - Benilde 
Andrade, president and treasurer of Amily Manufacturing, Inc., a Brockton 
garment company, was sentenced to three months in the House of 
Correction for failure to pay $8,697 in restitution to be paid to DET, as 
ordered in 1990, for delinquent employment tax contributions. 



Commonwealth v. Paul Weissbach - Waltham District Court - Paul F. 
Weissbach, of Arlington, admitted to sufficient facts to warrant a finding of 
guilty that he defrauded DET out of $19,376 in unemployment benefits 
over a one year period. The Commonwealth alleged that Weissbach made a 
series of misrepresentations to DET to qualify for, and remain eligible to 
receive, benefits. Weissbach, the president and owner of Mapco 
Automotive Services, Inc., in Worcester, falsely asserted that the company 
was closed down for lack of business during the time he collected 
unemployment. While Weissbach collected benefits, his name appeared as 
an estimator on 382 work orders and he was paying one full-time employee. 
The case was continued without a finding for six months with immediate 
repayment of the $19,376 to be paid to DET. 



Commonwealth v. James Cafferky, Jr. - Cambridge District Court. James 
Cafferky, Jr., of Medford, admitted to sufficient facts to warrant a finding 
of guilty that he defrauded DET out of $4,896.00 in unemployment benefits 
over a four month period. Cafferky made a series of false and misleading 
statements to obtain unemployment benefits while he was employed by 
Roth Enterprises. The case was continued without a finding for two years 
with full restitution of $4,896 to be paid to DET. If Cafferky violates the 
terms of the court order, he is subject to serve 59 days in the House of 
Correction. 



20 



DIVISION STATISTICAL SUMMARY 
COURT APPEARANCES 



Cases * 

Disposed 

July, 1995 

August 

September 

October 

November 

December 

January, 1996 

February 

March 

April 

May 

June, 1996 

Totals 

MONIES COLLECTED 

July 1995 

August 

September 

October 

November 

December 

January, 1996 

February 

March 

April 

May 

June, 1996 

Total 



Appearances 



40 


11 


40 


10 


39 


9 


33 


10 


27 


9 


13 


1 


29 


4 


38 


11 


28 


7 


65 


34 


95 


53 


_63 


12 


5J0 


168 


$ 46,709.61 




25,682.37 




39,251.08 




45,947.83 




150,873.21 




69,428.75 




64,875.88 




47,834.18 




55,264.38 




106,443.28 




110,245.20 




192,286.29 





S954.842.06 



* Includes court cases that are closed by conviction or alternative disposition. The 
Division may retain supervision over a prosecutionary period, if any. 



21 



CASES PENDING AS OF .TUNE 30. 1996 

Criminal Employee Claims 765 

Criminal Employer 510 

Other* 36 

Total Pending Cases 1311 



CASES ON DEFAULT AS OF JUNE 30. 1996: Defendants Remain at Large: 

Criminal Employees Claims 244 

Criminal Employer 419 

Total Defaults 663 



CASES CLOSED** 

Criminal Employee Claims 109 

Criminal Employer 78 

Other* _7 

Totals 194 



COMPLAINTS ISSUED 

Criminal Employee Claims 20 (439 counts) 

Criminal Employer 53 (452 counts) 

Totals 22 (891 counts) 



INDICTMENTS ISSUED 

Total 21 



♦Includes employer tax and/or employee fraudulent claims cases independendy 
developed by the Attorney General's Office and/or specially referred from sources 
as other than the Department of Employment and Training. 

**Includes removal of certain default warrants and case fdes closed by the Division 
and returned to DET after disposition of the matter and completion of the 
probationary period. 



22 



FAIR LABOR & BUSINESS PRACTICES DIVISION 

The Fair Labor & Business Practices Division is comprised of a staff of approximately 
forty-five (45) individuals including Assistant Attorneys General, Inspectors, Financial 
Investigators, Intake Clerks and Support Staff. The Division is legislatively mandated to 
investigate and prosecute, when appropriate, labor disputes involving the payment of wages, 
overtime, vacation pay and prevailing wages on public projects. A Director of Safety supervises 
enforcement of the Commonwealth's work place safety and child labor laws. A separate Bid 
Dispute Unit manages public contract bid dispute proceedings. The Division has full time 
offices in Boston and Springfield and, this year, opened part-time field offices in Pittsfield and 
Worcester. 

SIGNIFICANT ACTIVITIES 
SIGNIFICANT CASES 



Ouellet Drvwall/Marcel Ouellet - A drywall company and its president pled 
guilty to four counts of prevailing wage violations and failing to provide 
true and accurate payroll records. The company was debarred for 6 months, 
and the defendants were ordered to pay $7550 in fines and $200 in victim 
witness fees. 



August Moon/Kim Woo Gee/Paul Woo Gee - Two restaurant owners and 
their company pled guilty to ten counts of failing to pay the minimum 
wage, failing to provide true and accurate records, falsifying records, and 
retaliatory discharge. Restitution paid to the employees totaled $5092.89. 



William Gustus - A travel agency operator admitted to sufficient facts that 
he violated the non-payment of wage laws and agreed to pay $14,619.42 in 
restitution, plus victim witness fees, to seven workers. 



Joseph Pereira d/b/a Economy Disposal Systems - A Fall River contractor 
performing non-public works projects pled guilty to charges of non- 



23 



payment of wages and was ordered to pay full restitution of $1,300. He is 
serving time for unrelated charges. 



Attorney General v. Town of Blackstone and Blackstone Valley Disposal, 
Inc. After receiving notice of the Division's intention to file a civil 
complaint seeking to void a waste disposal contract on the grounds that it 
did not provide for the payment of the appropriate prevailing wage, the 
Town of Blackstone entered into a new contract with a different contractor 
that complies with G.L. c. 149, § 27F, the applicable prevailing wage 
structure. 



Pittsburgh Tank and Tower - Charged with a failure to pay the prevailing 
wage rate, a Kentucky company and its owner agreed to pay restitution of 
$7,500 to two employees and not to perform public construction work in 
Massachusetts for two years. 



DiGregorio Construction - A company which was found guilty of failing to 
pay the prevailing wage rate, failure to provide true and accurate records 
and non-payment of wages was ordered to pay $ 26,000 in restitution and 
received a six month debarment. 



Smith Architectural/ Stuart Smith - The individual defendant admitted to 
sufficient facts for a finding of guilty for prevailing wage rate violations of 
G.L. c. 149 §§27 and 27B. The case was continued for one year and he was 
ordered to pay $5,000 in restitution. The company pled guilty and received 
a six month debarment. 



Popico d/b/a/ Holden Farms Nursery - The company admitted to sufficient 
facts for a finding of guilty of failing to pay prevailing wages and agreed to 
pay $14,000 in restitution. 



Eastern Contractors, Inc. - A subsidiary corporation plead guilty to failing 
to pay overtime, failing to pay prevailing wage rates and failing to provide 
true and accurate records. In addition, the parent company pled guilty to 
avoiding workers compensation insurance premiums. Restitution and fines 
totaling $407,000 were paid. The parent company voluntarily was debarred 
from public works projects for three months and the subsidiary company 
was debarred for six months. 



24 



Integrated Services Associates (ISA) / William Polis - Mr. Polis admitted to 
sufficient facts for failing to pay wages to approximately 86 employees. 
Restitution was ordered in the amount of $52,594.05. 



Stanley Roofing / Paul Stanley - Mr. Stanley admitted to sufficient facts for 
failing to pay the prevailing wage rate and was ordered to pay $50,000 in 
restitution. 



Feddy General Contractor / Feddy Nwanko - A company was convicted of 
seven counts of failing to pay prevailing wage rates and one count of failing 
to provide true and accurate payroll records. It was debarred from doing 
public works projects for six months. 



Sunset Drywall/Peter Grenier - the defendant admitted to sufficient facts for 
failing to pay wages. Restitution in the amount of $8,000 was paid to two 
employees and the case was dismissed. 



DEBARMENT 

There have been twenty-two (22) debarments obtained by the Division in Fiscal Year 1996 

for convictions under G.L. Ch. 149 §§18 and 27, for failing to pay the prevailing wage rates, and, 

under G.L. Ch. 149 §27B, for failing to provide true and accurate records. 

• Eastern Seaboard Concrete Construction .- debarred for a period of 2 

months beginning July 7, 1995 through September 7, 1995. 



Albanese D & S , - debarred for a period of six months beginning July 26, 
1995 through January 6, 1996. 



Massassoit Electric Co., Inc., and John Meserve as President ,- debarred for 
a period of six months beginning August 5, 1995 through February 5, 1996. 



G. Lopes Construction, Inc., and Gilbert Lopes as President , 565 Winthrop 
Street, Taunton, MA 02780 - debarred for a period of six months beginning 
September 15, 1995 through March 15, 1996. 



25 



New England Reliance Electric, Inc., and Stephen Dilendick as President, 
and David Vivian as Manager , - debarred for a period of six months 
beginning October 27, 1995 through April 24, 1996. 



New Hampshire Concrete Cutting and Coring, Inc. and Frederick Nixon, as 
President , - debarred for a period of two years beginning November 30, 
1995 through November 30, 1997. 



Crocker Architectural Sheet Metal Co., Inc.. and Christine Crocker-Hebert, 
as President , - debarred for a period of six months beginning November 16, 
1995 through May 16, 1996. 



S.V. Raleigh Development Corp., and Steven Raleigh as President, - 
debarred for a period of six months beginning November 16, 1995 through 
May 16, 1996. 



J.C. Bostonian and Richard Cox as Owner , - debarred for a period of three 
months beginning December 21, 1995 through March 31, 1996. 



D & K Building Movers and David Popoloski as President , - debarred for a 
period of six months beginning February 1, 1996 through August 1, 1996. 



Eastern Contractors, Inc., and Ramesh Motwane as President , - voluntarily 
agreed to refrain from bidding for three months beginning June 5, 1996 
through September 4, 1996. 



East Coast Construction, Inc. , - debarred for a period of six months 
beginning May 24, 1996 through November 23, 1996. 



PER. Inc. and David E. Rodriguez as President , - Company debarred for a 
period of one year beginning February 23, 1996 through February 23, 1997. 
President debarred for a period of six months beginning February 23, 1996 
through August 23, 1996. 



26 



Elevator Maintenance and Services and Ronald Vigeant and Paul M. Hale, 
as President , - debarred for a period of sixty days beginning February 6, 
1996 through April 6, 1996. 



Feddv General Contractor, Inc., and Ferdinand (Feddv) Nwankwo, as 
President, - debarred for a period of six months beginning March 20, 1996 
through September 20, 1996. 



S & C Concrete and Stephen & Christopher Hill as President , - debarred for 
a period of six months beginning March 8, 1996 through September 8, 
1996. 



Lawrence M. Hamel, d/b/a L.M. Builders , - debarred for a period of two 
years beginning March 28, 1996 through March 28, 1998. 



Ouellet Drvwall, Inc., and Marcel Ouellet as President , - debarred for a 
period of six months beginning March 6, 1996 through September 6, 1996. 



Martin Metro East Insulation, Inc., and Kyle Martin as President , - 
debarred for a period of six months beginning May 8, 1996 through 
November 8, 1996. 



American Ventilation, Inc., and William Levasseur as President, and 
Dionne Levasseur as Clerk, - debarred for a period of six months beginning 
May 9, 1996 through November 9, 1996. 



Adgreene Company. Inc. , - debarred for a period of six months beginning 
June 7, 1996 through December 6, 1996. 



McLean Painting and Ronald McLean as President , - Company and 
President have been debarred for a period of six months beginning June 19, 
1996 through December 19, 1996. 



27 



PRE-COMPLAINT RESTITUTION SETTLEMENTS 

The Division has been successful in negotiating settlements in certain cases prior to 

initiating prosecutions. Some notable examples are as follows: 

• Bostwick Engineering -The legal issue presented in this prevailing wage 

matter was whether surveyors at public works projects are entitled to 
prevailing wage payments. Payment of back wages ($6,000) was obtained 
for surveyors on the Deer Island project. 



F.W. Russell & Sons - The company agreed to pay full restitution in the 
amount of $4,575.68 for prevailing wage claims and to cease its deductions 
for vacation plans. 



A & M Roofing & Sheet Metal - The company agreed to pay restitution for 
overtime underpayment in the amount of $170,000 owed to 87 employees 
and $4,000 for the four employees misclassified as laborers instead of 
roofers for calculating prevailing wage payments. 



Stannah Stairlifts, Inc. - The company paid full restitution for overtime 
owed, along with a contribution to the SCORE program of $1,500, for a 
total of $4,707. 



Marco Solo, Inc. and Mark Berkowitz - After non-payment of wages 
complaints were filed by seventeen employees when a restaurant closed, the 
owner agreed to pay full restitution of $13,206 to all employees. 



Lei Jing Restaurant - Upon a non-payment of wages claim brought by the 
Chinese Progressive Workers Union on behalf of thirteen employees, 
agreement was reached with the employer to pay full restitution in the 
amount of $23,642.85. 



J.C. Clocks, Inc. - A non-payment of wages claim was filed by employees 
who were not being compensated for travel time. The employer agreed to 
pay back wages ($340) and to rectify its payroll practices prospectively. 



28 



W.R. Beebe Associates - Non-payment of wages claims were filed by 
employees who were working from 6:00 a.m. to 5:00 p.m. but were only 
paid for the hours between 7:00 a.m. and 3:30 p.m.. The employer agreed 
to pay full restitution for two years in the amount of $34,989. 



Davison Company - Upon a prevailing wage claim that a subcontractor 
misclassified its employees, the employer paid full restitution of $1 1,000 
owed to two employees. 



ACT Abatement Corporation - The employer agreed to reimburse a union 
in the amount of $1 1,439 for withholding union dues in violation of the 
prevailing wage laws. 



Northeast Material Handling/Ormes Corporation - A subcontractor engaged 
in the "moving" business was determined to be subject to the payment of 
the prevailing wage rate to its workers. The general contractor agreed to 
pay full restitution to the underpaid workers in the amount of $10,000. 



Sparkle Cleaning - A company agreed to pay full restitution in the amount 
of $34,500 in five monthly installments for the non-payment of overtime to 
its cleaning employees. 



Hudson Liquid Asphalt - A company agreed not to perform work in 
Massachusetts for a period of six months and agreed to pay restitution to 16 
employees in the amount of $8,900 and a penalty of $4,000 payable to the 
Safe Neighborhood Initiative for violations of the prevailing wage laws. 



Ferris Landscaping - A company agreed to pay back wages for overtime 
pay in the amount of $6,600. 



29 



PUBLIC INTAKE UNIT 

Over the past year the Division's Public Intake Unit has maintained the case files regarding 
non-payment and prevailing wage cases. During that period the Division has received and 
processed 4,589 new complaints and disposed of 5,527 cases. It also has prepared over ten 
thousand non-payment and prevailing wage cases for archiving. 

The Public Intake Unit processed 1,582 checks, totaling $1,144,782.27, by the Boston 
Office and 155 checks, totaling $62,633.80, by the Springfield Office representing recovered 
funds for complainants. 



Total amount recovered for complainants by the Division 
for FY96: 

$2,808,520.68 



Total amount recovered for complainants by the Division 
since creation of Division in October 1993: 
$5,500,103.61 



FINANCIAL INVESTIGATIONS & AUDITS 

The Division's Financial Investigators conduct audits and investigations of claims which 
include non-payment of wages, non-payment of overtime pay and prevailing wage violations. 
During Fiscal Year 1996, a total of 1 14 financial audits/investigations were conducted, either on 
site or in the Division's offices. Of the 1 14 cases investigated, 70 cases have been closed. The 
remaining investigations currently are being completed or the matters have been assigned to an 
Assistant Attorney General for further review or action. The conducted audits included 61 
investigations relating to prevailing wage violations, 40 investigations pertaining to overtime 
violations and 13 investigations of either non-payment of wages or minimum wage violations. 



30 



The conducted audits have identified a total of $904,662 in various types of wages owed to 
employees. Through such efforts alone, the Division has collected and forwarded for 
disbursement during this fiscal year a total of $81,521 owed to employees. In the course of these 
investigations the Division has identified additional potential violations in the areas of workers 
compensation premium avoidance and fraud and employer unemployment insurance tax fraud 
which were referred to the Insurance Fraud Division and the Division of Employment and 
Training within the Bureau for further review and, if appropriate, legal action. 

BID UNIT 

The Attorney General, through the Bid Unit, is charged with the enforcement of the public 
bidding laws, G.L. c. 149, §§44A et seq. The main enforcement efforts undertaken by the Bid 
Unit include: (i) the receipt and resolution of filed bid protests; and (ii) the education of public 
contract participants with respect to the applicable bidding laws. 

Fiscal Year 1 996 saw an increase in the number of bid protests received and resolved by 
the Division. The cost of the projects protested ranged from $26,000 to over $40 million. The 
Attorney General's Office serves to provide a fair and accessible forum for the resolution of bid 
protests. In addition, with the participation and assistance of public contracting authorities, the 
process can quickly and competently determine the merits of a bid protest and, thereby, facilitate 
the efficient completion of public works projects. 

The Division's bid protest work generated the following statistics in Fiscal Year 1996: 
Bid Protests Filed: 181 

Bid Protests Resolved: 181 



31 



The education of public contracting participants (i.e., contractors, public contracting 
authorities, municipal counsel) is the other major thrust of the Division's enforcement efforts 
with regards to the public bidding laws. The Bid Unit's educational initiative has included: (i) 
the receipt of, and response to, telephone calls and all correspondence requesting information 
concerning the bidding laws; (ii) the presentation of industry seminars throughout the 
Commonwealth; and (iii) the compilation and dissemination of the Division's bid protest 
decisions. 

During Fiscal Year 1996 over 3,215 telephone calls concerning public contracting were 
received and answered by the Division. By providing such telephone support, the Division has 
become an important informational resource to contractors and public agencies alike. The 
information provided may also prevent subsequent noncompliance with the bidding laws or 
potential bidding protests. 

By the same token, the seminars sponsored by the Division provide the substantive and 
procedural information necessary to solicit bids or submit bids in the public contracting arena. 
The seminars have been given, on various occasions, to architectural groups, contracting groups 
and municipal counsel. 

The bid protest decisions of the Division also serve an educational function, because the 
decisions analyze the bidding laws with respect to the specific fact patterns presented by the 
protested project. To assist those interested in researching the Office's existing bid protest 
decisions, a subject matter index was developed during Fiscal Year 1996. The index has been 
disseminated to many interested parties since its development and has become an important 
industry reference tool to determine Office precedent and policy. 



32 



WAIVERS 

The Fair Labor and Business Practices Division is charged with reviewing requests to 
waive certain requirements of the labor laws under circumstances which might warrant such 
relief. The Division, under the supervision of it's Director of Safety, conducts an investigation 
before a waiver is granted. 

The Division granted waivers during Fiscal Year 1996 as follows: 
Type of Waiver 
7-Day Continuous Operations 
Meal Break Exemptions 
Seasonal Overtime Exemptions 
Theatrical Performances - Minors 
Minors - Working Late Hours 
Sheltered Workshops 
Public Works Projects/Extended Hours 
Scaffolding Permits 
3-Hours Daily Minimum Rule 
Window Washing Permits 
Special Student Worker License 
TOTALS: 



Amount 


Waiver Fees Collected 


112 


11,200 


115 


11,500 


30 


3,000 


21 


2,100 


70 


17,500 


10 


500 


6 


600 


3 


600 


7 


350 


1 


500 


110 


5,500 


485 


$53,350 



INITIATIVE/OUTREACH PROGRAMS 
CHILD LABOR 

The Division has collaborated with the Department of Public Health's (DPH) Child Labor 



33 



Program to produce outreach and educational materials for working teens and the public. The 

Division also conducted 273 child labor site inspections which resulted in 235 citations. 

CHILD LABOR VIDEO 

A child labor video was processed in order to be shown as part of a comprehensive 
program for teenagers to address the issues of health and safety at work. The video 
made its premiere at MTT on February 13, 1996. Eight high school students were 
hired as consultants to help get the message across as effectively as possible to the 
target population. The video is 12 minutes long and has been distributed both in 
Massachusetts and out of state. 



CHILD LABOR POSTER 

The same students who consulted on the child labor video worked with the Division 
and DPH to produce a poster to inform workers under the age of 1 8 of the 
protections afforded to them by the Commonwealth's child labor laws. The poster 
is aimed at attracting the attention of young workers who often are exploited 
because they haven't been informed of their rights. A total of 5000 posters will be 
distributed to schools, teen centers, adolescent health centers, and similar 
establishments. 



CHILD LABOR BROCHURE 

Pamphlets have been produced to educate minors, their parents, school departments, 
employers and health care providers about child labor issues. 



BROCKTON TEEN PROJECT 

The Division is represented on the advisory board of a two-year community based 
project in Brockton entitled: "Protecting Young Workers." The goal of the project 
is to educate high school students, teachers, employers, labor representatives, 
parents and other community members about occupational safety and health for 
working teens. 



OAG CHILDREN'S WORKING GROUP 

In June 1996, three representatives from the Division participated in the first 
meeting of the Children's Working Group, a new Attorney General's Office task 
force created to examine children's issues. 



34 



WORKPLACE SAFETY 

The responsibilities of the Division's safety program includes oversight and enforcement of 

workplace safety and health. The program has developed and strengthened ties to other programs 

within the Attorney General's Office and to other government agencies, in an effort to provide the 

maximum protection to workers while making the best use of the resources allocated to each of 

those programs. Groundwork has been laid for a system of safety and child labor referrals among 

the Massachusetts Department of Labor and Industries, the Massachusetts Department of Public 

Health, and the United States Department of Labor (OSHA and Child Labor). In addition, an 

interoffice task force continues to meet regularly to identify workplaces where violations of 

safety standards may be exposing workers to hazards. The Division also conducted 

investigations of 27 workplace fatalities and 36 serious injuries. 

• Deer Island - Division representatives have spent considerable time at Deer 

Island, working with the Boston Department of Health and Hospitals, 
Department of Labor and Industries, the federal Centers for Disease 
Control, the Massachusetts Water Resources Authority and unions 
representing the workers who are constructing two tunnels. One of the 
tunnels is seven and a half miles long and connects Long Island, Nutt Island 
and Deer Island. The other will be nine and a half miles long (420 feet 
under water) and will act as the outfall tunnel for waste processed at the 
Deer Island treatment plant. Three underground inspections were 
conducted and water samples were collected for analysis. An investigation 
and control program has been implemented and there now is routine 
surveillance of the project to identify any workplace hazards for the 
employees. 



Older Workers' Project - Department of Industrial Accidents records of 
workplace injuries were reviewed for injuries among workers over the age 
of 70. A pilot study was conducted to examine the causes of the injuries 
within this age group. The results of the study may be used to target certain 
types of work places that employ older workers. 



35 



REGIONAL OFFICES 

In our continued efforts to provide service to all of the workers and employers throughout 
the Commonwealth, the Division has sought to open satellite offices in addition to our permanent 
Boston and Springfield locations. The part-time regional offices opened in Fiscal Year 1996 are 
located in Pittsfield and Worcester. 



SPRINGFIELD OFFICE - The Division's full-time Springfield Office, 
located at 165 Liberty Street, Springfield, continues to serve the public in 
Western Massachusetts. 

Total Number of Complaints Received: 923 
Cases Closed 878 

Total Monies Collected $445,784.29 

Preconstruction Conferences 13 

Child Labor Site Visits 140 

Overtime Site Visits 109 

Prevailing Wage Site Visits 77 

Construction Safety Citations 35 

Industrial Safety Citations 17 

Accident Investigations 12 

Fatalities Investigated 4 



PnTSFIELD OFFICE - On January 26, 1996, the Division's part-time 
satellite office in Pittsfield had its grand opening. The office is located at 
46 Summer Street, Pittsfield, and is open every Tuesday from 8:45 a.m. 
until 1 :00 p.m.. The office averages eighteen complaints or referrals 
weekly. The opening of this satellite office has assisted in the enforcement 
of labor laws in Berkshire County. It also provides a convenient location 
where the Division can interface with labor and management in Berkshire 
County. Prior to the establishment of the Pittsfield office, Berkshire 
County matters were dealt with over the phone, through the mail, or in the 
Springfield Office, some 55 miles away. The following restitution has been 
collected by the Pittsfield Office during Fiscal Year 1996: 

Prevailing Rate Wages $56,76 1 .09 

Non-Payment of Wages $25 ,06 1 .44 



36 



WORCESTER OFFICE - On March 11, 1996, the Division's part-time 
satellite office in Worcester was opened. The office is located at 340 Main 
Street, 2nd Floor, Worcester. Office hours are Monday and Tuesday, 8:45 
a.m. to 5:00 p.m.. The following are the statistics for the office's initial 
performance during the last three months of Fiscal Year, 1996. 



Informational telephone calls 750 

Walk ins 48 

Complaint Forms mailed out 106 



CENTRAL REGISTER PROJECT 

The Division has continued the Central Register Project it began last fiscal year. Each 
week the Division sends a letter, along with informational brochures, to all Awarding Authorities 
seeking bids on a public works projects as published in the Central Register. The letter and 
brochure serve as a reminder of the applicable statutes enforced by the Division. In addition, the 
Division reminds all contractors who have been identified as having been awarded a project of 
their obligation to comply with the prevailing wage and other relevant laws enforced by the 
Division. The informational brochures entitled: "An Important Guide for Awarding Authorities" 
and "An Important Guide for Contractors Doing Public Works Project in Massachusetts," have 
greatly assisted in delivering the message that the Office of the Attorney General intends to 
enforce compliance with the labor laws of the Commonwealth. During Fiscal Year 1996 
approximately 4,826 informational letters were mailed out through the Central Register Project. 
LEGISLATION 

The Division continued to seek ways to increase in its ability to provide swift, efficient and 
fair enforcement of the Commonwealth's wage and employment laws. It participated actively in 
the drafting and filing of legislation to empower the Attorney General's Office to issue civil 
citations for violations of the Commonwealth's wage laws. Proposed legislation in this area 



37 



seeks alternative civil enforcement authority over prevailing wage, non-payment of wages, 

minimum wage and overtime. The Division views the legislation as a means of providing greater 

efficiency, flexibility and responsiveness to the vast majority of the complaints filed by the 

Commonwealth's workforce, thus allowing the Division to use the criminal court system for only 

the most egregious violations. Although the proposed legislation was approved by the Senate, it 

was not voted on by the House during the legislative term. 

Outside sections of the FY97 budget included several corrective changes to Chapter 149 

and 151 reflecting the authority of the Attorney General's Office to enforce the provisions of 

these chapters as transferred from the Department of Labor and Industries to the Attorney 

General in 1993. 

SPEAKING ENGAGEMENT/OUTREACH 

• Division staff outlined the prevailing wage and public bidding laws to a 

group of individuals consisting primarily of contractors and awarding 
authorities in southeastern Massachusetts at a UMass Dartmouth 
conference held on April 17, 1996. 



Division staff also presented material on the prevailing wage law and its 
enforcement with practical applications for cities and towns at the 
Massachusetts Municipal Auditors Association Annual Conference, which 
was held on June 3, 1996. 



The Division's Director of Safety, spoke at several professional meetings 
during the fiscal year. These included panel presentations on child labor to 
the Vocational Education Conference sponsored by the MA Department of 
Public Health in July, 1995 and the American Industrial Hygiene 
Association (ATHA) Conference and Exposition in Washington, D.C. in 
May, 1996. In November, 1995, the Safety Director and the Bureau Chief 
addressed the New England Section of the ATHA, discussing the role of the 
OAG in the enforcement of safety at work. The Safety Director also spoke 
at a Public Health Policy seminar at the University of Massachusetts in 
November, 1995, regarding the role of public health and safety 
professionals in bringing about positive changes in America's workplaces. 



38 



The Safety Director addressed the Association of General Contractors at 
one of their safety meetings and answered questions about the role of the 
Fair Labor and Business Practices Division with respect to workplace 
safety. In September, 1995, the Safety Director appeared on a television 
program that reported on health issues for hospital employees. In February, 
1996, the National Institute for Occupational Safety and Health sponsored 
hearings in three US cities to solicit input for their ten-year research 
agenda. The Safety Director wrote and presented testimony about the need 
for research on the effectiveness of various intervention schemes for 
occupational hazards. On the annual Workers' Memorial Day in April, the 
Safety Director and the Bureau Chief spoke to various audiences gathered 
to commemorate workers who had been killed on the job. 



The Division's Managing Attorney was a speaker at the Boston Bar 
Association's Ninth Annual SpoUight on Labor and Employment Law on 
June 18, 1996. One of the seminar's focal points was governmental agency 
investigations and enforcement of the following employment standards and 
employee benefit legislation: the Fair Labor Standards Act, the Family and 
Medical Leave Act, the Employee Retirement Income Security Act, the 
Executive Order 1246, the Occupational Safety and Health Act, and the 
Massachusetts Payment of Wages Law. 



The Division's Chief has addressed a variety of groups including union 
officials, business representatives, and legal groups. 



INSURANCE FRAUD DIVISION 

The Insurance Fraud Division ("IFD") is comprised of nine Assistant Attorneys General, a 
paralegal and two support staff. The Division includes a District Court Unit that focuses on 
expediting investigations and prosecutions of fraud cases that are appropriate for charging in the 
Commonwealth's district courts. 

The IFD investigates all types of insurance fraud allegations involving fraud against 
insurers and against public entities, such as the Commonwealth, its agencies and political 
subdivisions. The IFD also works with other Divisions in the Attorney General's Business & 



39 



Labor Protection Bureau to investigate and prosecute insurance fraud that adversely effects 
businesses or fair competition. Cases run a full range, from multi-million dollar premium fraud 
cases, major conspiracies by professionals or firms, or conspiracies centered around auto repair 
businesses, to individual's who file phony injury claims after staged motor vehicle accidents, 
"padded" claims on homeowner's policies and false billing for insured services. 

The IFD receives cases from a number of sources. By far, the biggest source of cases is the 
Massachusetts Insurance Fraud Bureau. In the last fiscal year, the IFD prosecuted the 100th 
defendant referred by the Insurance Fraud Bureau. The IFD also receives cases from the Public 
Employee Retirement Administration (PERA), the Governor's Auto Theft Strike Force (GATSF), 
the Department of Industrial Accidents (DIA), the Worker's Compensation Rating and 
Inspection Bureau (WCRIB), the National Insurance Crime Bureau (NICB), as well as cities and 
towns, private attorneys, judges and concerned citizens throughout the state. 
SIGNIFICANT ACTIVITIES 

The IFD obtained charges in sixty new cases in Fiscal Year 1996 and completed 
prosecutions in fifty-eight. Cases included charges of workers compensation fraud, motor 
vehicle insurance fraud, homeowners insurance fraud, life insurance fraud, health insurance 
fraud, as well as larceny and fraud by insurance agents, claims adjusters and damage appraisers. 
New cases charged in Fiscal Year 1996 included allegations that defendants obtained in excess of 
$725,000 in fraudulent insurance payments. Closed cases resulted in orders requiring restitution 
payments in excess of $850,000. 

WORKERS COMPENSATION FRAUD 



Commonwealth v. Richard DiChiara . Middlesex Superior Court. DiChiara 
was charged with workers compensation fraud, filing a false insurance 



40 



claim and larceny for his fraudulent receipt of $90,000 in benefits. 
DiChiara owned a security company at the time of an accident. He falsely 
inflated his income in order to collect $444 per week in benefits over a five 
year period. An investigation revealed that he worked as a security 
manager for a storage company and he operated a mail order business from 
his residence while collecting benefits. Despite that employment, DiChiara 
submitted statements to the insurer claiming that he was not working and 
had no income. DiChiara was sentenced to serve 3 months in the house of 
correction, followed by a suspended state prison sentence and probation for 
2 years. He must complete 100 hours of community service and repay over 
$90,000 in restitution. 



Commonwealth v. Roger Lydicksen , Norfolk Superior Court. Lydicksen 
was charged with workers compensation fraud, insurance fraud, larceny and 
conspiracy for collecting total disability benefits while operating a fencing 
and landscaping company. Lydicksen used his girlfriend's bank accounts to 
conceal income and expenses for the business because he was collecting 
total disability benefits at the time. Customers reported that Lydicksen ran 
the business and did the work but instructed customers to make checks 
payable to his girlfriend. The insurance company obtained a civil judgment 
and recovery from Lydicksen while this case was being prosecuted. 
Lydicksen was given a sentence of two years in the house of correction, 
suspended for two years, ordered to pay a fine of $10,000 and to pay 
restitution of $5,000. 



Commonwealth v. James DeVincentis , Norfolk Superior Court. 
DeVincentis pled guilty to insurance fraud in connection with a false 
disability claim he filed. The defendant allegedly was injured while 
working at a Grossman's Lumber Store. He remained on total disability for 
an extended period of time. While he was collecting benefits, he began 
working as a singer in a rock and roll band. Although the band earned very 
little money, it was clear that DeVincentis was not disabled while he was 
working with the band. The court imposed a suspended sentence and 
ordered restitution in the amount of $6,000 to be paid to The Travelers 
Insurance Co. 



Commonwealth v. Curtis Lanfair , Boston Municipal Court. On December 
4, 1995, Lanfair pled guilty in the Boston Municipal Court to charges of 
larceny over $250 and two counts of workers compensation insurance 
fraud. Lanfair worked as a maintenance man for the University of 
Massachusetts at Amherst. He injured his knee at work in 1985 and began 
collecting total disability benefits from the Commonwealth. However, 
investigators received information that Lanfair operated a newspaper 



41 



distribution business in 1991 and 1992. Further investigation revealed that 
Lanfair collected $10,568 in workers compensation benefits while working 
for the Greenfield Recorder delivering papers. Lanfair was ordered to serve 
probation for 3 years, to pay restitution of $10,568 and to perform 300 
hours of community service. 



Commonwealth v. David Wall , Suffolk Superior Court. Wall was found 
guilty of 2 counts of workers compensation fraud, 2 counts of larceny over 
$250, 3 counts of filing a false claim against the Commonwealth and 1 
count of attempted larceny. Wall drove buses, trucks and heavy 
construction equipment for the City of Boston. In 1991 he claimed he 
injured himself lifting a bundle of paper. In 1992 he filed a similar injury 
claim. During both years he collected total disability benefits as a result of 
the injury claims. However, an investigation revealed that Wall worked as 
a bus driver during both periods of total disability, during which he 
improperly collected $15,000 in benefits. Wall was sentenced to serve 6 
months in the house of correction, with a suspended sentence to follow. 
Wall also was ordered to repay the City of Boston $15,940.68 in restitution. 



MOTOR VEHICLE INSURANCE FRAUD 



Commonwealth v. Griselda Teiada Vasques , Lawrence District Court. 
Defendants were charged with motor vehicle insurance fraud and larceny 
for committing "garaging fraud," a form of insurance premium fraud. In 
applications for motor vehicle insurance, it was alleged that Griselda 
Vasques submitted false representations about her residence and principal 
place of garaging her vehicle. Ms. Vasques claimed that she lived in 
Methuen and kept her two cars garaged there, despite the fact that she lived 
in Lawrence. As a result, misrepresentations concerning her principal place 
of garaging her insured vehicle appeared on her insurance application in 
order to obtain improperly low premiums. Vasques pled guilty to the 
charges pending against her. She was ordered to pay restitution of $567 
and a fine of $567 (the amount of money she tried to save by the garaging 
fraud). 



Commonwealth v. Wayne Clark Sr. , Bristol Superior Court. The 
defendant was charged with motor vehicle insurance fraud, larceny, filing a 
false insurance claim, and concealing a vehicle to defraud an insurer after 
an expensive BMW he had reported stolen was found in a storage locker 
rented by Clark using his daughter's name. In addition, an investigation 
into other insurance claims by Clark revealed that he filed a $29,000 theft 
claim after tools and equipment allegedly were stolen from his home. 
Family members cooperated with the investigation and established that the 



42 



burglary never occurred. Finally, Clark and his son stole a BMW belonging 
to Clark's daughter because the car needed repairs she could not afford, 
Clark and his son stole the car without the daughter' s knowledge so she 
could file an insurance claim. Wayne Clark Jr. was also charged in the 
case. Due to his cooperation with investigators, he was given a suspended 
sentence and ordered to repay $13,000 for the stolen BMW. Wayne Clark 
Sr., was sentenced to serve 18 months in jail and to pay restitution in the 
amount of $29,000. 



Commonwealth v. Irving Shubert , Suffolk & Norfolk Superior Courts. 
Shubert and his company, Nationwide Glass, were charged with multiple 
counts of motor vehicle insurance fraud and larceny in connection with a 
scheme to submit inflated bills for auto glass replacement. Shubert 
operated a mobile van that replaced windshields off site. He had the 
customer sign a receipt for the glass, but defrauded the insurers by billing 
for more expensive windows than the ones actually installed. As a result, 
insurers were overbilled at least $57,000 over a period of several years. 
Shubert pled guilty to 1 1 counts of larceny over $250, 12 counts of Motor 
Vehicle insurance fraud, and 8 counts of larceny under $250. He was 
sentenced to serve 59 days in the house of correction, followed by 3 months 
of home confinement on an electronic bracelet and five years of probation. 
He must also pay $56,905 in restitution and complete 100 hours of 
community service. 



Commonwealth v. Chomm Ouk, et al , Lowell District Court. Seven 
defendants were charged with motor vehicle insurance fraud and larceny 
following the filing of false personal injury claims after a motor vehicle 
accident in Lowell. The seven defendants had just gotten out of a parked 
van and were walking away when the van was hit by a passing car. All 
seven defendants ran back to the van and jumped in. When the police 
arrived, all seven claimed to be injured and all sought treatment at local 
hospitals. Chomm Ouk, Menghy Phan and Reang Eao were all ordered to 
serve jail sentences for their parts in the scheme. The other defendants 
were found guilty and given suspended sentences and fines. 



Commonwealth v. Abbas Rad , Worcester Superior Court. Rad was the 
primary leader of a group of defendants who filed four separate false auto 
insurance claims. He was indicted in Worcester on four counts of motor 
vehicle insurance fraud and four counts of larceny. Rad owned a used car 
business and used his vehicles to stage two accidents. In addition, Rad and 
co-conspirators submitted false rental car bills and repair invoices on two 
other claims. Rad and the others collected over $15,000 before they were 
caught. After a jury trial, Rad was convicted of all charges, on December 4, 
1995, and was sentenced to serve one year in jail, with a suspended 



43 



sentence and three years probation to follow. Rad was also fined $28,750 
and ordered to pay restitution of over $10,000. 



Commonwealth v. Michael Cardoza , Quincy District Court. Cardoza 
reported to Boston Police that his Mercedes was stolen and he later filed an 
insurance claim for the car. Investigators from Arbella Insurance 
Company, working with police officers from Mattapoisett, located the 
Mercedes at the home of a close friend of Cardoza. The defendant was 
then charged with motor vehicle insurance fraud, attempted larceny and 
concealing a motor vehicle to defraud an insurer. Cardoza pled guilty and 
was sentenced to serve 1 year in jail and ordered to pay $625 in fines. 



OTHER INSURANCE FRAUD CASES 



Commonwealth v. Pamela Simpson , Quincy District Court. Pamela 
Simpson was a claims adjuster for USF&G Insurance Company. She used 
her insider status to insert false claims in otherwise legitimate personal 
injury claim files and arranged to have checks issued to accomplices. Her 
brother, Michael Lodge, recruited accomplices and drove the accomplices 
to the bank to cash insurance checks, retaining the majority of the money 
for Simpson and Lodge. Simpson and Lodge were charged with motor 
vehicle insurance fraud, larceny, forgery and conspiracy. Simpson was 
given a suspended sentence, with probation for 3 years, and ordered to 
repay $13,537 in restitution to USF&G and a $2,000 fine. Michael Lodge 
was arrested and convicted of unrelated murder charges after we filed. As a 
result, and in view of his existing life sentence, the charges against him 
were guilty-filed. 



Commonwealth v. Dr. Joel Korins , Bristol Superior Court. Dr. Korins was 
a podiatrist with a practice in southeastern Massachusetts. He pled guilty to 
five counts of insurance fraud, five counts of larceny, five counts of filing 
false health care claims and conspiracy on April 17, 1996. Dr. Korins 
submitted fraudulent treatment records for a large number of his patients. 
False bills in ten different patient files were documented during an 
investigation. In many cases, Dr. Korins billed for treatment that was never 
provided. Dr. Korins also conspired with a friend (who also was indicted) 
to submit phony bills to a health insurer for treatment to the friend's family 
members. Dr. Korins was sentenced to a two year suspended sentence and 
ordered to pay $16,072.62 in restitution. In addition, as a condition of the 
Commonwealth's recommendation, Dr. Korins was required to surrender 
his license to practice medicine and to agree not to practice medicine or 
apply for reinstatement for ten years. 



44 



• Commonwealth v. Laycock & Blaha , Hingham District Court. On 

November 20, 1995, complaints were issued against James Laycock and 
Kurt Blaha, charging them with insurance fraud, attempted larceny, filing a 
false affidavit and conspiracy in connection with a scheme to stage the theft 
of an expensive sailboat. Laycock and Blaha bought two boats that had 
been badly damaged in a 1991 hurricane. They hired someone to combine 
the two boats into one, by using the side of one boat, fused to the side of the 
other boat. They then "registered" two boats, under separate names. Blaha 
obtained insurance for the non-existent boat. The defendants then sailed 
the new boat (without a name painted on the transom) to a marina and 
registered it with the harbor master. Shortly after that, the defendants 
reported the fictitious boat stolen. The real boat appeared in Laycock's 
custody under a different name. Investigators from the marine insurer were 
suspicious and worked with officers from the Massachusetts Environmental 
Police to check into the claim. Blaha's insurance claim was denied before 
any payment was made. Blaha pled guilty and agreed to cooperate with the 
Commonwealth's investigation. Laycock was given an 18 month 
suspended sentence, fined $1,000 and ordered to complete 250 hours of 
community service. The insurer recovered a substantial sum from Laycock 
in a separate civil action. 

DIVISION STATISTICAL SUMMARY 
TYPES OF CASES 

Motor Vehicle Insurance Fraud 64 

Workers Compensation Fraud 39 

Other Insurance Fraud 15 

118 



COURTS 



Superior Court Cases 40 

(Essex, Middlesex, Norfolk, 
Plymouth, Suffolk, Worcester) 



District Court Cases 78 

(Attleboro, Ayer, Boston Municipal Court, 1 18 

Brockton, Brookline, Cambridge, Chelsea, 
Dedham, Dorchester, Edgartown. Framingham, 
Greenfield, Hingham, Lawrence, Leominster, 
Lowell, Maiden, Natick, Plymouth, Quincy, 
Roxbury, Springfield, Waltham, Wareham, 
Wrentham, West Roxbury) 



45 



TRAINING & OUTREACH PROGRAMS 

AGO/IFB Training Seminar on Workers Compensation Insurance Premium Fraud: 
Investigations & Prosecutions 

• On December 7 and 8, 1995 the EFD presented a seminar on Workers 
Compensation Insurance Premium Fraud, in a program jointly sponsored by 
the Attorney General's Office and the Massachusetts Insurance Fraud 
Bureau. The Program brought together professionals from all areas of 
workers compensation insurance, law enforcement and prosecution and 
focused on practical tips for spotting patterns of insurance fraud, such as 
concealed or misclassified employees and improper use of independent 
contractor status. Speakers discussed how to document the fraud during 
audits, surveillance or interviews and how to achieve equally important 
goals of protecting against premium fraud and effectively prosecuting those 
who commit it. 

Training Programs for the Public Employee Retirement Administration (PERA) Workers 
Compensation Unit 

• The IFD regularly conducts bi-monthly meetings with PERA's workers 
compensation unit and reviews investigations in progress and pending 
prosecutions. In addition, the IFD has participated in two Training 
Programs for PERA claims adjusters and agency attorneys on the detection, 
investigation, documentation and proof of workers compensation fraud by 
public sector employees. 



46 



MEDICAID FRAUD CONTROL UNIT 

The Attorney General's Medicaid Fraud Control Unit (MFCU) is comprised of nine 
prosecutors; fifteen investigators, including auditors, pharmacists, registered nurses, computer 
analysts, and support staff. The MFCU investigates and prosecutes healthcare providers for 
defrauding the Medicaid program, and those caretakers that abuse, neglect, mistreat or financially 
exploit the elderly and the disabled in long term care facilities. The MFCU, one of 47 such units 
nationwide, is certified annually and receives 75% of its operating budget from the federal 
government. 

During fiscal year 1996, the MFCU initiated several criminal and civil enforcement actions 
as it sought to have a significant deterrent impact on the healthcare provider community. As 
reported below, the MFCU investigators and prosecutors brought criminal and civil actions 
against a variety of healthcare providers, including physicians, dentists, and psychiatrists; 
pharmaceutical, transportation and durable medical equipment companies; clinical laboratories 
and home health aides. In addition to recovering nearly $3.3 million in criminal and civil fines 
and restitution, the Attorney General's MFCU brought 68 individual indictments, convicted a 
total of 26 individuals and completed 12 prosecutions of nursing home caretakers who abused, 
mistreated or neglected elderly residents in long term care facilities. 
SIGNIFICANT ACTIVITDZS 



PHYSICIANS 



Newton Psychiatrist - A Newton psychiatrist was sentenced to three-to-five 
years in state prison after he pled guilty to stealing from the state's 
Medicaid program. The defendant was ordered to pay over $125,000 in 
fines and restitution after he fraudulently billed Medicaid for services that 
were never performed, including charging the program for hour-long office 
visits when they actually took only 15 minutes and charging Medicaid for 
claims for therapy sessions on days when he was actually out of the state on 



47 



vacation. The defendant currently is serving a 40-month sentence in a 
federal penitentiary for federal Medicare fraud and mail fraud. The state 
sentence is to be served concurrent with the federal sentence. The case is a 
result of a joint enforcement initiative between the Attorney General's 
Office, the U.S. Attorney's office, the Federal Bureau of Investigation and 
the Federal Office of Inspector General. As a result of the state and federal 
fraud investigations, the defendant's license to practice medicine has been 
suspended indefinitely by the Board of Medicine. (May 1996) 



Longmeadow Physician - A civil settlement was reached with a 
Longmeadow doctor who allegedly overbilled Medicaid recipients for 
allergy treatments. The physician paid $35,000 to the Medicaid program to 
resolve billing discrepancies identified in a probe by the Medicaid Fraud 
Control Unit. Contrary to Medicaid regulations, the doctor inappropriately 
billed Medicaid patients both for office visits and allergy injections on the 
same day when the primary purpose of the visit was for an injection. 
(November 1995) 



TRANSPORTATION 



DENTISTS 



Regional Transit Authorities - The Medicaid Fraud Control Unit recovered 
more than $170,000 in billings to resolve disputes between four regional 
transit authorities and Medicaid regarding contracts to provide taxi and 
wheelchair van transportation services for Medicaid recipients. Medicaid 
pays for recipients' transportation to and from medical appointments. The 
companies have agreed to pay financial adjustments to Medicaid and 
renegotiate the applicable contracts. In addition, each transit authority 
agreed to provide transportation in identified geographical areas of the 
Commonwealth and each will provide educational programs for Medicaid 
recipients, designed to show them how to use less expensive fixed-route 
transportation to minimize their reliance on more expensive taxi and van 
service. In a related investigation, a Springfield taxi cab company was 
convicted of 28 counts of causing false Medicaid transportation claims and 
larceny. The defendant was ordered to pay $23,000 for inflating the miles 
that Medicaid recipients were transported to and from their medical 
destinations. (January 1996) 



Two Lynn & Jamaica Plain Dentists - Two dentists have agreed to pay a 
total of $500,000 in penalties to settle allegations of Medicaid fraud and 
abuse in their billing practices. The agreements came as result of joint 
fraud and abuse investigations into Medicaid providers by the MFCU and 



48 



the Division of Medical Assistance (DMA). The Lynn dentist, who 
investigators allege had a history of inappropriate billing for dental services 
to Medicaid, agreed to pay $375,000 in full payment of alleged overcharges 
and civil penalties to the Medicaid program. The dentist also voluntarily 
agreed to withdraw as a provider of dental services to Medicaid 
beneficiaries. The Jamaica Plain dentist paid $125,000, including 
restitution and penalties, and had agreed to a court ordered compliance 
program and future audits by the DMA. According to the MFCU 
investigators, both dentists allegedly billed more than the maximum 
allowable charges, billed for services not covered by Medicaid and billed 
for services to patients who were not yet Medicaid eligible. (January 1996) 



HOME HEALTH COMPANIES 



Mental Health Centers - Three South Shore area mental health centers 
agreed to pay $147,000 in restitution for allegedly billing Medicaid for 
questionable music psychotherapy sessions in nursing homes. Legitimate 
group psychotherapy for Medicaid recipients is a service that is reimbursed 
by the program. The defendants acted contrary to Medicaid regulations that 
prohibit mental health centers from billing non-medical or recreational 
services as psychotherapy. (December 1995) 



Roslindale Footwear Distributor - A former footwear distributor for nursing 
home residents pled guilty to five counts of Medicaid provider fraud and 
four counts of larceny from the Medicaid program. The defendant was 
sentenced to a three-to-five year suspended sentence, and 10 years 
supervised probation. He was ordered to pay $150,000 in restitution and he 
must perform 100 hours of community services for each year he is on 
probation. The defendant devised schemes in which he defrauded 
Medicaid by overcharging for orthopedic shoes or supplying the shoes to 
those who didn't need them. He also billed Medicaid for removable arch 
supports, overcharging the program far in excess of the maximum 
allowable amount for orthopedic footwear and charging for custom-made 
shoe inserts that were pre-made. (March 1996) 



Health Care Company - A California health care company with offices in 
Massachusetts agreed to repay $1.36 million to the Commonwealth for 
alleged Medicaid abuses. The payment is part of a $44.5 million 
nationwide settlement with the company to be shared by all 50 states. The 
company supplies home infusion therapy products, which involves the 
delivery of medicine and nutrition to patients in a home-setting through the 
use of tubes and other medical equipment. The health care company has 
been the subject of civil, administrative and criminal investigations on both 



49 



the state and federal level into its business practices in providing services 
and therapies to Medicaid and Medicare recipients. Under the terms of the 
agreement, the company will cooperate in the continuing investigation of 
those employees and physicians allegedly involved with Medicaid referrals 
and illegal kickbacks. The company also pled guilty to federal mail fraud 
charges and paid the federal government $161 million in civil damages and 
criminal fines for entering into illegal contracts with physicians by paying 
them to refer Medicaid patients to use their products. Under both state and 
federal law, it is illegal to compensate physicians for the referral of 
Medicaid patients. (August 1995) 



HOME HEALTH AIDES 



Fall River Home Health Aide - A home health care attendant who stole 
more than $30,000 from the Medicaid program was convicted of multiple 
counts of filing false Medicaid claims and larceny. The defendant was 
sentenced to a committed year in the Suffolk County House of Correction 
and five years probation. In addition, she was ordered to pay $15,000 in 
restitution or serve 3,000 hours of community service. The state's personal 
care attendant program allows hundreds of chronically disabled recipients 
to remain at home with the aid of personal care givers, rather than being 
admitted to far more expensive institutional facilities. The defendant 
provided substandard care that lead to the recipient's hospitalization while 
forging signatures on official personal care attendant time sheets. 
(September 1995) 



Duxbury Home Health Aide - A former nurse whose license had been 
suspended for diverting drugs for her personal use pled guilty to five counts 
of unlicensed practice of nursing, five counts of unlicensed practice to a 
profession, five counts of larceny by false pretense, two counts of forgery, 
two counts of uttering a forged instrument, and two counts of causing false 
Medicaid claims. The defendant was sentenced to one year at MCI 
Framingham, six months to be served under house arrest, the remainder of 
the sentence to be suspended with three years supervised probation. As a 
condition of probation, the defendant must undergo an evaluation for drug 
therapy and counseling and cannot work for a health care facility. The 
defendant's nursing license was suspended when she admitted to the state 
Board of Registration in Nursing that she had taken drugs for her own 
personal use from a Boston area hospital where she was employed. The 
defendant worked as a registered nurse after she had presented forged 
nursing licenses at several nursing homes, hospitals and medical offices. 
(October 1995) 



50 



PHARMACIES 



Brighton Home Health Aide - A Brighton woman whose registered nursing 
license had been revoked, pled guilty to three counts of unlicensed practice 
of nursing and two counts of unlicensed practice of a profession. The 
defendant was sentenced to 1 8 months of supervised probation. As 
condition of the probation, she must enroll in the Board of Registration in 
Nursing Substance Abuse Rehabilitation Program and not seek employment 
as a registered nurse. The defendant's nursing license was revoked by the 
Board of Registration in Nursing for mishandling narcotics at a local 
hospital. According to the Board, she signed out amounts of Morphine and 
Demerol from the hospital pharmacy where she was employed that could 
not be accounted for in records. Despite the revocation, the defendant 
continued to illegally practice as a registered nurse. (April 1996) 



Quincy Pharmacy - A Quincy pharmacy and its pharmacist owner pled 
guilty to filing false Medicaid claims and larceny. Involved in a scheme 
with a Jamaica Plain doctor, the pharmacist allegedly dispensed drugs 
prescribed by the doctor that were not medically necessary. The defendant 
allegedly also required that any patient who had a controlled substance 
prescription filled at his pharmacy had to present a second prescription for a 
non-controlled substance before the drugs were to be dispensed. In many 
cases, the second non-controlled substance prescription was left at the store 
and then placed back into inventory for resale. Investigators allege the 
doctor in question agreed to such an arrangement. The pharmacist was 
sentenced to two years probation and ordered to pay $71,000 in restitution 
and fines for defrauding the state's Medicaid program. (December 1995) 



Holvoke & South Boston Pharmacies - Two pharmacies paid $10,000 each 
in a civil settlement for alleged wrongful collection of funds from the 
state's Medicaid program. Each pharmacy allegedly received $10,000 from 
the Commonwealth's Medicaid program after inappropriately billing the 
Commonwealth for original physician prescriptions which were not present 
in their pharmacy records. The pharmacies also allegedly billed Medicaid 
for certain items at prices higher than the usual and customary charges to 
customers. (April 1996) 



Pharmacy Chain - A regional supermarket and pharmacy chain paid $1 
million to settle allegations that the chain overcharged Medicaid programs 
in Massachusetts, Connecticut and Rhode Island. The pharmacy chain 
agreed to pay the Massachusetts Medicaid program $600,000. The three- 
state settlement calls for $150,000 in payments to each of the Medicaid 
programs in Connecticut and Rhode Island as well as $50,000 to 



51 



community service programs in each of those states. The MFCU 
investigators alleged that the stores were not crediting certain discounts to 
the Medicaid program as required by law and offered a gift certificate 
program to consumers in exchange for their filling new prescriptions at the 
pharmacies. Investigators also alleged that some Medicaid customers 
received cash after making small purchases with the gift certificates. The 
Attorney General's pharmacy audit revealed that the chain's pharmacies 
had billed Medicaid using improper codes, failed to properly retain 
prescription documentation required by law, and billed for Medicaid 
prescriptions ordered but never picked up by Medicaid customers. The 
Massachusetts segment of the investigation began after the MFCU received 
complaints that Medicaid customers were cashing gift certificate coupons 
for items that were not medically necessary. (January 1 996) 



ELDER ABUSE AND FINANCIAL EXPLOITATION 



Former Roxbury Nursing Home Employees - Six former nursing home 
employees were convicted for their role in a scheme to steal approximately 
$79,000 from a male resident. Three of the defendants pled guilty to larceny, 
receiving stolen property and uttering a forged instrument. One defendant 
was sentenced to six months in the House of Correction, suspended for two 
years. The remaining defendants were placed on probation and ordered to 
pay restitution. The defendants fraudulently obtained access to the victim's 
mail, including bank statements and blank checks. They forged the 
resident's signature and presented the same for payment. (August 1995) 



West Harwich Nurses Aide - A former certified nurses aide admitted to 
sufficient facts for a guilty finding on one count each of patient abuse and 
assault and battery for striking a disabled patient who was suffering from a 
head injury. The case was continued without a finding for two years on the 
condition that the aide not work in a long-term care facility in any capacity 
for five years. (January 1996) 



Shelburne Falls Nurses Aide - A former certified nurses aide admitted to 
sufficient facts to one count each of patient abuse and assault and battery of ; 
retarded nursing home resident. The case was continued without a finding 
for one year and the defendant was placed on probation and ordered to 
obtain counseling and therapy. According to the MFCU investigators, 
witnesses reported that the aide slapped the resident with her open hand on 
the side of his head after the resident punched the aide in her chest. 
(February 1996) 



52 



New Bedford Nurses Aide - A nurses aide admitted that she hit a mentally 
retarded resident with her open hand across her face after the resident spit at 
the aide, pulled her ponytail and hit her several items. The case was 
continued without a finding for a period of sixty (60) days. The 
Commonwealth argued that a guilty finding should enter and recommended 
that the defendant be placed on one (1) year of supervised probation. The 
aide is permanently barred from employment in Massachusetts as a certified 
nurses aide in a long-term facility. (March 1996) 



• Manomet Nurses Aide - A nurses aide was charged with assault and battery 

and abuse of a 27-year-old mentally retarded resident of a Plymouth nursing 
home. Witnesses reported that the aide allegedly put the resident in a 
headlock to force him to attend a day program against his will. After a trial 
by jury, the defendant was found not guilty. (August 1995) 

DIVISION STATISTICAL SUMMARY 

STATISTICAL SUMMARY 

Formal Investigations Initiated 53 

Investigations Completed and Closed 65 

Individual Indictments 63 

Corporate Indictments 5 

Individuals Convicted 26 

Corporations Convicted 2 

PATIENT ABUSE/NEGLECT CASES 

Abuse & Neglect Referrals 882 

Abuse & Neglect Investigations 148 

Total Criminal Complaints & Indictments 8 

Prosecutions Completed and Closed 12 

Individuals Convicted 8 

Pending Prosecutions 1 3 



CIVIL/CRIMINAL FINANCIAL RECOVERIES 

Number of Civil Recovery Cases 15 

Civil Recovery $2,859,486.99 

Number of Criminal Recovery Cases 1 8 

Criminal Recovery $ 433,356.78 

Total Recovery $3,292,833.77 



53 



Initiative/Outreach Programs 
Training and Enforcement Initiatives 

The Medicaid Fraud Control Unit continued to ensure that its staff emphasize current 
healthcare fraud investigative techniques. Some of the seminars and conferences attended by the 
MFCU staff included: 

The National Anti-Fraud Association Annual Conference and Training Seminar; The 
National Association of Medicaid Fraud Control Units Annual Conference and Training Seminar; 
The Federal Law Enforcement Training Program for MFCU investigators; The New England Drug 
Diversion Conference; The Insurance Fraud Bureau's Computer Information Seminar; The Attorney 
General's Comprehensive In-Service Investigators Training. 

Additional law enforcement associations developed or co-sponsored by the Attorney 
General's MFCU include: 



The Northeast Healthcare Law Enforcement Association (NHLEA) - 
Consisting of chief investigators from New England MFCUs, including New 
York and New Jersey, Massachusetts State Police Diversion Investigative 
Unit and federal law enforcement agencies including the Drug Enforcement 
Administration (DEA), the Federal Bureau of Investigations (FBI), the 
Internal Revenue Service (IRS) and the Office of Inspector General (OIG), 
this group develops joint state/federal health care fraud investigations and 
prosecutions. Attorney General Scott Harshbarger was honored as the first 
recipient of NHLEA's annual recognition award for his aggressive approach 
to fighting healthcare fraud. 



Metra Health Association - Representatives from the New England MFCUs, 
the Office of Inspector General, FBI and Medicare meet with the Association 
of Survey Utilization Review Systems to discuss the latest trends in 
analyzing and packaging utilization data for successful prosecutions. 



54 



The Massachusetts Drug Diversion Task Force - Members from the MFCU 
meet with representatives from local state and federal law enforcement 
agencies to discuss health care drug diversion cases, pool investigative 
resources and develop comprehensive prosecutions. 



Education/Outreach Programs 



Massachusetts Extended Care Federation -The MFCU continues to expand on 
its relationship with the Massachusetts Extended Care Federation. The 
Massachusetts Extended Care Federation, along with the Massachusetts 
Attorney General's Office, U.S. Attorney's Office, Massachusetts Hospital 
Association, Massachusetts Association of HMO's and the Home Health Care 
Association of Massachusetts, sponsored a health care fraud seminar on June 
6, 1996 at the World Trade Center. The focus of the seminar was to educate 
health care providers how to prevent health care fraud and abuse in their 
respective industries through effective compliance programs. The seminar 
was the result of a major cooperative effort among all agencies. The keynote 
speaker for the conference was Janet Reno, United States Attorney General. 
Future training seminars are scheduled to educate nursing home supervisors 
and employees about the Attorney General's office patient/elder abuse 
priorities. 



Department of Public Health - The MFCU meets regularly with the officials 
from the Department of Public Health to discuss issues affecting the 
monitoring and policing of instances of elder abuse, neglect, and mistreatment 
in long term care facilities. 



Pharmacy Program - The MFCU's Pharmacy Coordinator lectures regularly to 
the state's registered pharmacists to instruct and educate on The MFCU's 
pharmacy enforcement program and the latest trends, laws, and regulations 
affecting the pharmacy community. 



New England Anti-Fraud Association - The MFCU meets quarterly with the 
New England Anti-Fraud Association which consists of private insurance 
health care fraud investigators. The MFCU has lectured the group on the 
importance of investigative cooperation between private and public health care 
enforcement to identify fraudulent providers. 



Division of Medical Assistance - The MFCU meets monthly with the Division 
of Medical Assistance, the agency that administers the state's Medicaid 
program, to discuss effective fraud review programs, referrals, and the 
development of health care fraud investigations. 



55 



Drug Diversion Issues - MFCU representatives, along with the Drug 
Enforcement Agency and the Board of Registration in Medicine and 
Pharmacy, have lectured to state agencies concerning drug diversion 
investigation issues and concerns. 



56 



CRIMINAL BUREAU 

Assistant attorneys general in the Criminal Bureau prosecute individuals and corporations for 
violations of the criminal laws in courts throughout the Commonwealth, and represent the 
Commonwealth in appeals from these convictions. In addition, attorneys in the Bureau represent the 
Commonwealth in federal court on collateral challenges to state criminal convictions court (habeas 
corpus petitions) and defend the Commonwealth's judges, district attorneys, probation, parole, and 
corrections officers when they are sued civilly in state and federal court by prisoners challenging their 
criminal convictions or the terms of their confinement. 

The Bureau is comprised of 42 prosecutors and 20 support staff, including secretaries, 
paralegals, and financial investigators. In addition, a Criminal Investigations Division consisting of 31 
Massachusetts state troopers is assigned to the Bureau to investigate allegations of criminal 
wrongdoing across the state. 

The Criminal Bureau is organized among five major divisions: the Narcotics and Special 
Investigations Division, the Public Integrity Division, the Environmental Crimes Strike Force, the 
Appellate Division, and the Economic Crimes Division. These five divisions are grouped generally by 
area of practice and type of crime prosecuted. Each division is managed by a division chief, who both 
supervises the work of the attorneys assigned to that division and serves as senior prosecutor. 

In addition to the work of its five major divisions, the Criminal Bureau combats urban 
violence in the state's most vulnerable urban communities through the Attorney General's "Safe 
Neighborhood Initiative." The Safe Neighborhood Initiative brings together prosecutors, police, and 
community leaders through a multi-disciplinary approach to stemming violence. This community 
prosecution model incorporates targeted law enforcement with violence prevention and economic 
revitalization. This past fiscal year, the Attorney General commenced Safe Neighborhood Initiatives in 
the Grove Hall Section of Roxbury and in Brockton, Massachusetts, in partnership with the Suffolk 
County District Attorney and the Plymouth County District Attorney. 



57 



Financial Investigation Division 

The Financial Investigation Division of the Attorney General's Criminal bureau is comprised 
of eight financial investigative professionals. Paul Stewart, CFE is the Director. The statff has two 
other Certified Fraud Examiners, Two Certified Public Accountants and three Attorneys. Their job is 
to investigate and assist in prosecuting cases of larceny, public corruption, tax evasion, campaign 
finance violation, false claims, procurement fraud and special investigations. Referrals come from 
various state and municipal agencies as well as from private sector concerns. In addition, investigators 
maintain the accounting for forfeited funds seized by the Bureau's Narcotics and Special Investigations 
Unit, and also assist the Asset Forfeiture Unit in researching titles of forfeited property. 

The Bureau is lead by a Bureau Chief and Deputy Bureau Chief, who manage the work of the 
five divisions and advise the Attorney General on law enforcement policy and anti-crime initiatives. 
Bureau Attorney for Training and Administration, Mary A. Phillips, is responsible for coordinating the 
grand jury, training new assistant attorneys general, and assisting the Bureau Chief with administrative 
and budget matters. Bureau Attorney for Policy and Legislation, Elisabeth Medvedow, spearheads the 
Criminal Bureau's work on statewide criminal justice policy and legislation. 

Due to the Attorney General's role as chief law enforcement officer for the Commonwealth, 
members of the Criminal Bureau are frequently called upon to train law enforcement officers and 
prosecutors across the state on important and emerging criminal law issues, to prepare and draft 
legislation, and to take part in criminal justice reform. The Criminal Bureau also publishes quarterly a 
"Law Enforcement Newsletter" to advise judges, police officers, and prosecutors about statutory and 
case-related developments in the area of criminal law. 

The case descriptions and statistics which follow reflect the many successful efforts of the 
Criminal Bureau staff in fiscal year 1996, and the Bureau's commitment to making a difference for the 
citizens of Massachusetts by combatting private and public sector fraud, crimes of violence, and 
environmental crime. 



58 



Notwithstanding the Bureau's many successes in FY 1996, the year was overshadowed by the 
tragic death of our friend and fellow member of the Criminal Bureau, Assistant Attorney General Paul 
McLaughlin. Paul was murdered on September 25, 1995 in West Roxbury, Massachusetts as he was 
returning home from work. Although the homicide remains under investigation, the possible 
connection between Paul's work as a gang prosecutor in Suffolk Superior Court and his violent death 
from a gunshot wound stunned the entire Massachusetts law enforcement community. Despite this 
tremendous loss to the Bureau, Paul's death has strengthened his fellow prosecutors' resolve to combat 
urban violence and protect the public safety, twin goals which were the benchmark of Paul's many 
years of service as a prosecutor. 

APPELLATE DIVISION 

The Appellate Division handles a variety of criminal, federal habeas corpus, state habeas 
corpus and other civil cases which impact criminal prosecutions and the criminal justice system itself. 
During the period from July 1, 1995 through June 30, 1996, the following assistant attorneys general 
were assigned to the Appellate Division during part or all of the year: William Meade, William 
Duensing, Greg Massing, Ellyn Lazar, Djuna Perkins, Gail McKenna, Nina Ross, and Pamela Hunt. 
The division has a paralegal, Katherine DiGennaro, and two secretarial support staff. In addition, 
several other Criminal Bureau assistants handled Appellate Division cases during FY 1996: Elisabeth 
Medvedow, Bob Sikellis, Molly Parks, Linda Murphy, and Michael Cassidy. A volunteer attorney also 
worked with the Division during part of the fiscal year. 

The Division handled approximately 778 cases during the course of the year. Three hundred 
forty- four (344) new cases were opened in FY 1996, and 406 were closed. 

In addition to case work, Division attorneys participate in and present training programs both for the 
Criminal Bureau and office-wide; and work with other Criminal Bureau attorneys on a variety of 
investigative, motion, trial, post conviction, and single justice matters. The Division also works 
closely with the District Attorneys' Offices, especially their Appellate Divisions, in identifying and 



59 



acting as a clearinghouse on issues of statewide importance and interest. Additionally, Assistant 
Attorney General Djuna Perkins participated in the Urban Violence program for six months 
prosecuting cases in the Brockton District Court. 
I. SUMMARY OF FY 1996 APPELLATE DIVISION CASE STATISTICS 



A.Cases Handled 


Cases 


Cases 


Total Cases 




Opened 


Disposed 


Handled 


A. Federal Habeas 


87 


104 


200 


B. Federal Civil 


43 


42 


83 


C. State Civil 


77 


106 


217 


D.State Habeas Corpus 


37 


43 


79 


E. 211, §3 and other 








Single Justice cases 


13 


18 


20 


F. Criminal 


80 


89 


168 


G.Other 


_7 


_4 


Jl 




344 


406 


778 



FY 


FY 


FY 


FY 


FY 


FY 


1996 


1995 


1994 


1993 


1992 


1991 


344 


341 


307 


351 


222 


161 


406 


515* 


213 


282 


206 


N/A 


778 


747 


652 


649 


428 


N/A 



The following is a comparison of case activity for the Appellate Division for the last several years: 



TOTAL CASES OPENED 
TOTAL CASES DISPOSED 
TOTAL CASES HANDLED 



* Includes 125 old, inactive cases. 

The caseload of the Division continues to steadily increase. This year Appellate Division 
attorneys handled 778 cases, slightly more than FY 1995, over a hundred more than in FY 1994 and 
FY 1993, and an 80% increase over the number of cases handled in FY 1992. Despite the large number 
of cases handled, 406 active cases were disposed by Division attorneys, substantially more than the 213 
cases closed in FY 1994, 282 cases closed in FY 1993, and is nearly twice the 206 cases closed in FY 
1992. 



60 



One hundred forty- four (144) additional cases were referred by the Appellate Division to 
agency counsel at the Department of Correction, or the Parole Board, or to the District Attorneys. 





FY 


FY 


FY 


FY 


FY 




1996 


1995 


1994 


1993 


1992 


Appellate Briefs Filed 


63 


79 


54 


52 


56 


By Court 












U.S. Supreme Court 


3 


3 


2 


4 


7 


Court of Appeals 












(First Circuit) 


12 


23 


14 


7 


10 


U.S. Bankruptcy Court 











2 





SJC 


21 


21 


14 


13 


7 


Appeals Court 


27 


32 


24 


26 


32 




63 


79 


54 


52 


56 


Bv Case Tvpe 












Criminal 


30 


37 


19 


20 


26 


Federal Habeas 


9 


19 


13 


7 


11 


All Other Civil/ 












State Habeas 


25 


23 


24 


25 


19 



The Appellate Division's 63 briefs filed this fiscal year were fewer than the number filed last 
year but reflect an approximately 20% increase over the three previous years. 

Briefs in the United States Court of Appeals (12) were filed in 9 habeas corpus cases and 3 
federal civil actions. We were successful in all cases but one in which the Court affirmed the District 
Court's issuance of the writ of habeas corpus. 

Two of the three briefs filed in the United States Supreme Court were written upon the request 
of the Court in opposition to petitions for certiorari in federal habeas corpus (Gilday) and state criminal 
(Power) cases. Certiorari was denied in both cases. The third brief was an amicus brief written by 
AAG and NAAG Supreme Court Fellow Donna Palermino in support of the United States 's petition 
for certiorari (Ursery and $405,089.23) . Forty-two (42) other states joined us in urging the Court to 



61 



review two federal decisions in which lower courts found that double jeopardy barred the government 
from pursuing both asset forfeiture and criminal prosection of narcotics offenses. The Supreme Court 
granted certiorari and ultimately reversed. 

This year the number of briefs filed in the Supreme Judicial Court (21) equaled the highest 
number in five years. Twelve (12) briefs were filed in criminal cases and 9 were filed in civil matters. 
They concerned the constitutionality of permitting the Commonwealth to appeal a finding by a trial 
judge that a person is no longer sexually dangerous; the propriety of requiring only five-sixths of the 
jury to agree in a jury trial in a sexually dangerous person case; whether a police chief has the power to 
grant an officer under investigation immunity from prosecution without the knowledge or agreement of 
the prosecutor; whether the Parole Board can deny parole to a sex offender who does not accept 
responsibility for his crime and whether the Committee for Public Counsel Services may represent 
prisoners in civil suits; and the circumstances under which police officers executing a search warrant in 
a place of business may use experts to assist them to identify the items to be seized; as well as in a 
number of appeals from criminal convictions. We were successful in all cases that were decided in FY 
1996. 

The Division wrote 27 briefs which were filed in the Appeals Court, 1 5 in criminal cases, and 
13 in civil matters, approximately the same number as in previous years, and which were as varied in 
subject matter as the Division's caseload. We were successful in all but two cases in the Appeals 
Court; one of those is pending on further review. 

The Division continued its efforts to file amicus briefs on behalf of the Attorney General in 
cases having broad impact and importance to the criminal justice system, consistent with the Attorney 
General's statutory responsibilities as the chief law enforcement officer of the Commonwealth. We 
wrote 7 amicus briefs during FY 1996. The question whether double jeopardy principles preclude the 
government from both prosecuting criminal offenses and imposing civil or administrative sanctions 
upon the offender was a very important criminal justice issue during the past year. Apart from the brief 



62 



filed in the United States Supreme Court in support of certiorari in Ursery and $405,089.23 , the 
Attorney General's office played a major role in preparation of the brief on the merits in that case 
which was filed by the State of Connecticut. At the state level, we filed an amicus brief addressing 
these same issues, whether the government may both prosecute a drug offender and seek forfeiture of 
proceeds and instrumentabilities of drug crimes (Albano) . We also wrote a brief in support of the 
state's right to both prosecute drunk drivers and to suspend their drivers' licenses for failing or refusing 
to take the breathalyzer test. (Luk and Leduc) . 

Amicus brief were also written on the authority of a police officer outside his jurisdiction to 
stop a driver suspected of operating a motor vehicle under the influence (Morrissev) ; the 
constitutionality of sex offender registry legislation (Opinion of the Justices) ; the circumstances under 
which a rape crisis counselor may refuse to reveal privileged information about a victim of sexual 
assault (Fuller) ; and the question of the payment of attorney's fees when the Commonwealth exercises 
its right to take interlocutory appeals from the allowance of motions to suppress evidence or dismiss 
charges in criminal cases (Murphy) . In all cases that were decided in FY 1996, the Court adopted the 
arguments we made. 

We appeared as amicus on behalf of the Attorney General, the Commissioner of Probation, 
Department of Correction and Parole Board in a case where we argued that the public interest and 
those of various law enforcement agencies dictated against allowing a prisoner to legally change his 
name (Verrill) . 
C. Renditions 

Attorneys from the entire Criminal Bureau, at the request of the Governor's office, review the 
legal sufficiency of applications for Governor's warrants, at the requested by other states and those by 
Massachusetts District Attorneys, the Department of Correction and Parole Board. From July 1, 1995 
through June 30, 1996, 137 different cases were reviewed. Whenever a person arrested on a 
Governor's warrant challenges the validity of the warrant, Criminal Bureau attorneys handle the habeas 



63 



corpus cases in the state and federal trial and appellate courts, and coordinate extradition of the fugitive 
to the requesting state. 

H. FY 1996 CASE HIGHLIGHTS 
A. Federal Habeas Corpus 

Federal habeas corpus cases challenging state criminal convictions represent approximately 
25% of the Appellate Division's cases but occupy a substantial amount of the attorneys' time. During 
the course of the fiscal year, the Appellate Division carried 196 federal habeas cases. Eighty-seven 
(87) new cases were opened, and 103 were disposed. The Commonwealth is only required to defend 
cases in which there is an order by the federal court to answer the petition. Division attorneys are 
especially proud of their work in federal habeas corpus and work closely with the District Attorneys 
offices that handled the prosecutions in state court. Most cases require the filing of lengthy and 
complex memoranda which are the equivalent of full appellate briefs. In two cases there have been 
evidentiary hearings in federal court. One (DiPietro) involved a claim of ineffective assistance of 
counsel and the other (Ely) concerns an allegation of prosecutorial failure to disclose the existence of a 
plea agreement with a government witness. 

Among the cases handled by the Division are a number of challenges to first-degree murder 
convictions (Brown , Ely , Robinson , Koonce , Daughtry) in several of which the trial occurred many 
years ago. We were successful in having the Supreme Court deny certiorari in the habeas corpus case 
brought by William Gilday , convicted of the murder of a Boston police officer twenty-five years ago, 
and in having the First Circuit Court of Appeals deny habeas relief to James Kater upon his claim that 
he could not be retried for first-degree murder after his last trial resulted in a hung jury. 

We appealed an order granting the writ of habeas corpus in Rossetti on the ground that double 
jeopardy precluded trial for conspiracy after the petitioner had been previously acquitted for the 
substantive offense of armed robbery. The First Circuit agreed with us that double jeopardy does not 



64 



preclude prosecution for conspiracy after an acquittal for the substantive crime, but issued the writ with 
the possibility of retrial because certain evidence should not have been admitted at trial. 

The enactment in April 1996 of substantial revisions to the federal habeas corpus statute has 
occasioned a number of new issues and litigation concerning its interpretation and reach, and the 
Division regularly consults with assistant attorneys general from other states and the National 
Association of Attorneys General to share information and experiences with the new law. 

B. Federal Civil Cases 

The Appellate Division handled 83 federal civil matters, which primarily involved civil rights 
actions brought against state judges, prosecutors, clerks, probation officers, the Parole Board, and other 
criminal justice officials. Several cases involve representation of prosecutors who have been 
subpoenaed to testify or to produce their investigative or trial files, or cases where the integrity of state 
criminal prosecutions are at issue. In two separate cases (Kvricopoulos and Cook) , convicted 
defendants each brought civil rights actions against virtually every state and local police and correction 
official, judge, clerk, prosecutor, probation officer, and appointed attorney connected with his 
prosecution. Despite the variety of defendants and claims, we were able to obtain dismissal of the 
cases prior to any time-consuming and burdensome discovery. In another case, representing a District 
Attorney's office, we were able to obtain a protective order preventing the disclosure of personnel 
records. 

C. State Civil/State Habeas Cases 

During FT 1996, the Appellate Division handled 79 state habeas corpus actions filed by 
prisoners seeking immediate release from confinement in such matters as attacks on commitments to 
the Treatment Center, challenges to the validity of Governor's warrants, challenges to criminal 
convictions and claims that parole or probation surrenders were unlawful. 

In one case, a Treatment Center inmate sought habeas corpus relief ten years after his 
commitment on account of the procedure followed at that time. We were able to reconstruct the 



65 



original proceedings to demonstrate his claim had no merit (DeWolfe) . In Zullo, a case of first 
impression, a parole violator claimed the Board waived jurisdiction over him by not seeking his return 
to Massachusetts earlier than it did. We convinced the Supreme Judicial Court to reverse the Appeals 
Court's order to release the petitioner and to define the factors a judge must consider when a parole 
violator claims delay in executing a parole revocation warrant violates his rights to due process and 
fundamental fairness. 

The Appellate Division's civil caseload of 218 cases includes appeals from the denial of 
petitions for release from the Treatment Center, and appeals in all cases handled at the trial court level 
by agency counsel at the Parole Board, but the large majority of state civil cases involve representation 
of prosecutors, judges, public defenders, and other court personnel sued for actions taken in their 
official capacity. 

Two important civil cases involved sexually dangerous person proceedings. In Sheridan , we 
successfully convinced the SJC to rule that in any jury trial in a SDP case, a proper verdict may be 
delivered when only 5/6 of the jurors agree. In Hill , the SJC held that there is no constitutional 
objection to permitting the Commonwealth to appeal a determination that an individual is no longer 
sexually dangerous, and that a person can be proved to be sexually dangerous in the absence of recent 
misconduct while incarcerated and where he refuses treatment. 

While the District Attorneys generally represent their own interests when they are subpoenaed 
to testify or produce their case and investigative files in civil litigation, the Appellate Division 
continues to provide assistance in these cases. Additionally, we actively seek to prevent collateral 
attacks on criminal convictions in cases where defendants bring civil actions against prosecutors, 
courts, and witnesses for their actions relating to prosecutions. A trial court ruled against us in one 
case where it declared the vagrancy statute unconstitutional and enjoined a District Attorney from 
enforcing it (Benefit) . In several other cases we were able to resist efforts of criminal defendants to 



66 



seek by civil actions in the nature of replevin the return of items seized from them before they could be 
used as evidence in criminal cases. 

D. Criminal Cases 

The majority of criminal cases handled by the Appellate Division are appeals from criminal 
convictions in prosecutions by the trial divisions of the Attorney General's Criminal Bureau. The 
number of cases handled this year, 168, reflects the increase in Criminal Bureau prosecutions and 
convictions. The Division has also represented the Commissioner of Probation in cases where a former 
criminal defendant has sought expungement of court and probation records (Robinson ; SMF), and 
appeared in the trial courts in a number of criminal cases. 

The appellate courts affirmed convictions or denials of motions for new trial in a number of 
narcotics cases, as well as murder (Schand), armed robbery (NameyJ, contempt (Filos), rape (Sequeira) , 
embezzlement by a fiduciary (Dellorfano), and larceny (Fallon) . We were unsuccessful arguing that a 
probation record should not be expunged (SMF) , and in a masked armed robbery case the Appeals 
Court (Meuse) ordered a new trial, that case is pending on further review. In addition, in Godfroy , a 
sexual dangerous person commitment was vacated and resentencing was ordered n the criminal 
conviction. 

We convinced the Supreme Court to deny certiorari in a case which involved a challenge to the 
propriety of a condition of probation which prohibited a person convicted in a notorious crime 
involving the death of a police officer from profiting from the crime of her long-time fugitive status 
(Power) . In addition, the Supreme Judicial Court adopted the arguments we made in support of 
Massachusetts' ability to prosecute a murder case where the victim was kidnapped and assaulted in 
Massachusetts, but actually killed in New York (Lent) . 

E. G.L. c. 21 1, § 3 and Other Single Justice Matters 

The Appellate Division handled 20 different cases in the single justice session of the Supreme 
Judicial Court. These matters often involve representation of the courts and judges, but may also 



67 



include the defense of some aspect of the criminal justice process or system. We handled several 
matters involving judicial orders excluding the media from parts of criminal trials, and were involved 
in the litigation surrounding the transfer of prisoners to Texas. 

IE. CRIMINAL JUSTICE INITIATIVES 

• Assistant Attorney General Pamela Hunt is a member of the Massachusetts Sentencing 
Commission and serves as chairperson of the Commission's Committee on Intermediate 
Sanctions. 

• Assistant Attorney General William Duensing serves on the National Association of Attorneys 
General (NAAG) committee on frivolous inmate litigation and was involved in drafting model 
state legislation and similar legislation filed in Massachusetts. 

• Assistant Attorney General William Meade is the Attorney General's representative to the 
Criminal Justice Training Council. 

• Assistant Attorneys General from the Appellate Division serve as the Attorney General's 
representative to the Criminal History Systems Board. 

• Assistant Attorney General Pamela Hunt is a member of the Supreme Judicial Court's Standing 
Advisory Committee on the Criminal Rules. 

• The Division provides information to the Parole Board relevant to its consideration of pardon 
and commutation matters and for parole decisions for those serving parole-eligible life 
sentences. 



68 



• Attorneys from the Appellate Division worked in cooperation with the Chief Justice of the 

District Court Department and the United States Attorney's Office in developing a procedure to 
provide for contemporaneous recording of the validity of guilty please and admissions in the 
District Courts. 

IV. SAAG SUPERVISION 

A. Parole Board 

Agency counsel at the Parole Board are designated Special Assistant Attorneys General 
("SAAG") to handle the Board's litigation in the state trial courts. Appellate Division attorneys work 
closely with Board counsel in the defense of these matters, and handle all appeals in these cases. The 
Appellate Division is also involved in the many Parole Board cases which require coordination with 
the Department of Correction. Assistant attorneys general from the Appellate Division and the 
Government Bureau defend all cases concerning the Parole Board in federal court. 

B. Treatment Center Litigation 

Counsel at the Department of Correction have been designated as Special Assistant Attorneys 
General to handle all sexually dangerous person (SDP) § 9 hearings in the Superior Court. Assistant 
attorneys general in the Appellate Division are responsible for all appeals in these cases and are 
involved in supervision and monitoring of the SDP trials. 

Department of Correction attorneys, under the direction and supervision of the Appellate 
Division, handle civil and state habeas corpus litigation filed by inmates of the Treatment Center. The 
Appellate Division continues to defend cases which attack the validity of the original SDP commitment 
or the underlying criminal conviction. 



69 



CRIMINAL INVESTIGATIONS DIVISION 

The Criminal Investigations Division provides the Criminal Bureau with a corps of seasoned 
investigators who have a wealth of experience dealing with investigations on the State, Federal, and 
Municipal level and also diverse experiences from the private sector. The police and civilian 
investigators assigned to the Division provide a wealth of investigative experience and expertise in 
such areas as organized crime, narcotics trafficking, public corruption, money laundering, securities 
violations, tax fraud, crimes against the elderly, environmental crime and fiduciary fraud. The 
Criminal Investigations Division has a great working relationship with all divisions and Bureaus within 
the Office of the Attorney General, providing technical and investigative resources when requested. 
The Criminal Investigations Division also has developed outstanding cooperative working 
relationships with many law enforcement organizations throughout the Commonwealth. The State 
Police Unit assigned to the Criminal Bureau is commanded by Detective Lieutenant John Kelly, 
Lieutenant Robert Friend and Sergeants Walter Carlson and Dermot Moriarty (Public Corruption, 
Economic Crimes), Lieutenant Andrew Palombo and Sergeant Thomas Greeley (Narcotics and Special 
Investigations Unit), and Sergeant Brian Kennedy (Springfield Office). Lieutenant Gail Larson of the 
Environmental Police supervises environmental investigations. Paul Stewart is the Director of 
Financial Investigations with a staff of CPAs and CFEs who provide invaluable expertise in financial 
investigations. 

A major source of pride of the division continues to be the cooperative investigations 
undertaken with other law enforcement, governmental or regulatory agencies. The Narcotics and 
Special Investigations Division, in conjunction with the Boston Police Department and Boston 
Housing Authority Police, conducted an extensive undercover narcotics investigation in a Charlestown 
public housing facility. The investigation resulted in the indictment and subsequent arrest of 18 
individuals and the seizure of a substantial quantity of narcotics. This successful, cooperative effort 



70 



has done much to improve the quality of life and safety of the residents of this section of the City of 
Boston. 

The Public Corruption Unit investigated the practice of over billing on the part of a private 
investigator in his dealings with the Committee for Public Counsel Services (CPCS). The over billing 
resulted in overcharges of several hundred thousand dollars. The investigation resulted in the 
subsequent indictment of the private investigator and the end of this unsavory lucrative scheme. 

During FY 96, the Criminal Investigations Division accomplished the following: 

Investigations 300 

Arrests 255 

Search Warrants 70 

Stolen Property Seized $550,000 

Background Investigations 325 

Assist to Other Agencies 400 

Drug Money Seized $183,805.86 



71 



THE ECONOMIC CRIMES DIVISION 
I. Introduction 

The Economic Crimes Division investigates and prosecutes all types of private sector, white 
collar and economic crime in state courts across the Commonwealth. The victims of these crimes take 
many shapes, from the vulnerable elderly individual, to the small business or large corporation. The 
cases handled by the division demonstrate that economic and white collar crimes cost Massachusetts 
working men and women hundreds of thousands of dollars annually. Yet, it is the personal toll these 
crimes take on individual victims that is staggering, stripping those victims of their life savings, their 
businesses, and ultimately, their personal futures. Throughout the past year, the Economic Crimes 
Division focused on three priority areas: lawyer fraud, tax crimes, and all types of financial crimes 
(including theft and securities fraud) which victimize both vulnerable individuals and large 
corporations. Cases involving financial crimes against the elderly are priority prosecutions for the 
Economic Crimes Division. 

The assistant attorneys general in the Economic Crimes Division consist of seven attorneys, one 
special attorney general, and one secretary, in addition to civilian financial 
investigators and state police officers. The members of the division during part or all of the year 
consist of the following: Carol Starkey, Chief, AAG; Molly Parks, AAG; James Bryant, AAG; Kevin 
Brekka, AAG; Stephanie Kelly, AAG; Sarah Hartry, AAG; Lori Balboni, AAG; Stephen Paterniti, 
AAG; Andy Zaikis, SAAG; Olivia Blanchette, Secretary; James McFadden, Investigator; Patrick 
Ormond, Investigator; Brad Chase, Investigator. 

In Fiscal Year 1996, the Economic Crimes Division commenced over fifty-one criminal 
prosecutions against those individuals, entities, and corporations that had taken advantage of then- 
positions of power in the private sector, hurting not only the vulnerable victims who held their trust, 
but ultimately all of the citizens of the Commonwealth. During the same time, over fifty-eight 
convictions were obtained against white collar criminals and corporations, which included those 



72 



defendants that were not charged within the Fiscal Year. The attached chart reflects the statistics for 

the financial and tax prosecutions conducted by the Division throughout the Fiscal Year. 

II. Private Sector Fraud: The Financial & Tax Prosecutions Handled By The Economic 
Crimes Division 

A. The Financial Prosecutions 

The Economic Crimes Division receives referrals from both state and federal agencies, as well as 
judges, attorneys, private parties, and police departments throughout the Commonwealth. The 
Division continues to work closely with such offices and agencies as the Board of Bar Overseers, the 
Criminal Investigations Bureau of the Department of Revenue, the F.D.I.C, the Secretary of the 
Commonwealth, the United States Attorney's Office, and various District Attorney's Offices across the 
state. 

The investigations initiated by the Division tend to be difficult, complex white collar cases that 
involve the analysis and review of prolific documentation, tracing an economic crime through exposing 
the "paper trail" of evidence left by the white collar criminal. In order to conduct a thorough 
investigation of an economic fraud, extensive interviews and testimony must be obtained from all 
people involved or affected by the theft. In addition, most cases require the use of an expert witness to 
aid an assistant attorney general or investigator in evaluating the perpetrator's handwriting, the financial 
formula he employed, or the mental state which enabled him to perpetrate his crime. 

Some highlights of the financial crimes cases prosecuted by the Economic Crimes Division in fiscal 
year 1996 include: 



Commonwealth v. Josephine White , Bristol & Essex Superior Court. 

This case involves the victimization of multiple elderly women by means of a "pigeon drop" scam in 
several counties throughout the Commonwealth. The defendant was able to steal approximately 
$93,000.00 from the elderly women, tricking some out of their personal effects and jewelry. The 
defendant plead guilty to all charges in Essex Superior Court on 12/12/95. 



73 



Commonwealth v. John & Nancy Burgess , Bristol & Suffolk Superior Court. 

This case involved a husband and wife team each charged with multiple counts of larceny and 
conspiracy. The Commonwealth alleges that the couple stole money from multiple neighbors by (1) 
fraudulently representing that their money would be invested in real estate purchases; and (2) falsely 
representing that they would invest a married couple's accumulated Individual Retirement Account 
money in a special ERA account with a superior rate of return. As of this writing, John Burgess is 
currently being held on $100,000 cash bail. His wife, Nancy, is a fugitive at large. 



Commonwealth v. Mark Gauthier , Middlesex Superior Court. 

This matter involved a former Middlesex District Attorney and Chelmsford lawyer who had defrauded 
his wife and children of approximately $30,000. AAG Stephanie Kelly, assisted by AAG Steve 
Patemiti, conducted a five-day jury trial in Middlesex Superior Court, successfully convicting this 
defendant on all counts of larceny, forgery, obtaining signature by false pretenses and uttering with 
which he had been charged. 



Commonwealth v. Joseph Pereira , Bristol Superior Court. 

This defendant was indicted and convicted in Bristol County for multiple scams involving Larceny, 
Forgery, Uttering and the Unauthorized Practice of Law on three separate occasions. After Joseph 
Pereira was indicted the first time, and while he was out on bail, the defendant perpetrated yet further 
scams, one of which involved posing as an attorney and conducting a bench trial! 



Commonwealth v. London & Global, Inc. , Suffolk Superior Court. 

The above Joseph Pereira investigation uncovered a large Suffolk County operation conducting illegal 
investment scams, d.b.a. London & Global, Inc. This operation roped members of the public (primarily 
Asian Americans and young students) into investing large sums of money to "trade and sell" on a non- 
existent foreign market. These "investments" were to make the victims' money similar to the stock 
market. The London & Global office in downtown Boston was set up by the defendants to resemble an 
actual foreign exchange facility, complete with international clocks on the walls, computers showing 
foreign trade figures, and training sessions with "experts" in foreign trade to teach the victims how to 
make money. The Commonwealth alleges that this was simply an elaborate rouse to steal money. 



Commonwealth v. Jason & Harriet Roberts , Norfolk Superior Court. 

This matter involves the Juvenile Diabetes Chapter President and his wife, Jason & Harriet Roberts, 
alleged to have embezzled approximately $300,000 from the Juvenile Diabetes Foundation, and 
omitting income from their state tax returns. 



74 



B. Tax Prosecutions 

Although each assistant attorney general in the Economic Crimes Division handles a caseload 
including tax cases, one assistant attorney general, Lori Balboni, with the assistance of one special 
assistant attorney general, Andy Zaikis, concentrate full time on this subject area. In Fiscal Year 1996, 
the Tax Prosecution Unit litigated a significant number of cases in the criminal courts and conducted 
several long-term investigations of suspected tax crimes. Many cases were referred to the Office of 
the Attorney General by the Criminal Investigations Bureau of the Department of Revenue, and 
Investigators of that agency actively assisted the Tax Prosecution Unit in investigations and 
prosecutions in FY '96. The analysis, documentation and witnesses provided by the Department of 
Revenue were invaluable to the successful prosecution of these cases. In addition, other cases were 
developed by the Tax Prosecution Unit as a result of referrals from other agencies. 

Additionally, in April, 1996, the Economic Crimes Division turned its collective efforts towards 
preparing for and completing the annual "Tax Sweep" initiative with the Criminal Investigations 
Bureau from the Department of Revenue. With the team work of the CEB investigators and the AAGs 
and SAAGs working within the Economic Crimes Division, the Grand Jury presentations that 
comprised Tax Sweep '96 was completed on April 9th, 1996. The resulting efforts of both offices 
consisted of 27 counts of tax violations returned by the Grand Jury against 15 targets for a total of 7 
million dollars in unreported taxable sales or income! 

This Tax Sweep year comprised a showing of one of the most diverse group of targets ever pursued 
for this annual effort, demonstrated by the important and serious violations charged, the backgrounds 
of the offenders, and the combined amount of unreported taxes. 

During the entire Fiscal Year of 1996, 23 new cases were charged in the Superior Courts throughout 
the Commonwealth, with 18 pending cases being successfully prosecuted to completion. A couple of 
the tax cases prosecuted by the Division are highlighted below. 



75 



Commonwealth v. Robert Russo , Suffolk Superior Court. 

Tax authorities in Montana alerted the Economic crimes Division and the Department of revenue to 
potential tax violations perpetrated by a Robert Russo. This defendant had been submitting fake tax 
returns to get refund checks for six previous years. SAAG Andy Zaikis worked with DOR 
investigators to indict Robert A. Russo in Suffolk County, just weeks after first learning of this 
information, for multiple counts of Willful Filing of False Returns and Larceny Over, totalling 
approximately $10,000. 



Commonwealth v. John Bolduc , Suffolk Superior Court. 

This matter involves a Deputy Tax Collector for dozens of cities and towns in the Commonwealth, 
who is alleged to have evaded personal income taxes and failed to pay over any withholding taxes for 
his employees. 



III. Non-case Related Initiatives of the Economic Crimes 
Division 

Members of the Division also participated in significant training programs and speaking 

engagements. 

* Workshop leader and volunteer attorney at Harvard Law School's Fall 1995 
Trial Advocacy Workshop , held during the week of September 18, 1995. 
(AAG C.Starkey) 

* Speaker for the Certified Fraud Examiners on the Role of the Attorney 
General's Office in combatting white collar crime, held at the Parker House 
Hotel on Oct. 18,1995. 

(AAG C. Starkey) 

* Panelist Speaker at the Harvard Law School "World of Law in Criminal 
Prosecutions and Defense" Panel Discussions , with fellow panelists Robert 
Bennett from Skadden, Arps, Slate Meagher & Flom, Washington D.C., Gil 
Garcetti, District Attorney from Los Angeles County, and Penny Marshall, 
Assistant Federal Defender in Charge, Wilmington, DE. Held at Harvard Law 
School on Nov. 1, 1995 from 7:30 to 10:00 PM. 

(AAG C. Starkey) 

* Guest Speaker and Mock Trial Advocate before Judge Spurlock for Boston 
University's Law School held at the Middlesex Courthouse, courtroom 10A, on 
Nov. 2, 1995 from 4:30 to 7:30 PM. Direct and cross examination of two 
experts during a mock civil and criminal trial were conducted, with a lecture on 
trial technique following the event. 

(AAG C.Starkey) 



76 



* Guest Speaker at Perkins, Smith & Cohen Fraud Conference on "Criminal 
Law Prosecutions for Fraud at the State Level," held at Suffolk University Law 
School Conference Rooms for approximately 150 attendees on Jan. 29, 1996 
from 5:30 to 10:00 PM. 
(AAG C. Starkey) 



* NAAG Committee member for President-Elect Harshbarger on Elder Issues & 

Initiatives. 

(AAG C.Starkey) 



* Subcommittee member for Attorney General's Task Force on Racial & Ethnic 
Bias in the Courts . 
(AAG S.Hartry) 



* Speaker to undergraduates at the Boston University R.E.S.P.E.C.T. Week on 
the topic of "Empowerment and Family Violence," held on Feb. 14, 1996. 
(AAG S.Hartry) 

* Guest Speaker at Massachusetts School Bank Association Annual Spring 
Conference to speak on the topic of "The Modern Face of White Collar Crime ," 
held at Tri-County Technical School in Franklin, MA for approximately 250-300 
attendees on April 2, 1996 from 8:30 AM to 2:00 PM. 

(AAG C. Starkey) 



IV. Number of Defendants Charged Or Indicted Broken By 
The Type of Crime: 

A. Total Defendants Charged: 51. 

B. Number of Counts Charged (approximate figures): 

1. Larceny Over $250 (Including Embezzlement & False 
Pretense, Receiving Stolen Prop) - 67 

2. Conspiracy to Commit Larceny - 23 

3. Insurance Fraud - 1 

4. Uttering, Forgery, Counterfeiting - 80 

5. Tax crimes - 95 

6. Other • 6 

C. Number of Dispositions and Convictions: 58. 

D. Cases Broken Down By Referral, Charge, and if the case has been disposed, By Court and 
Sentence: 



77 



V. CASES CHARGED BY THE ECONOMIC CRIMES DIVISION 
FISCAL YEAR 1996 



B. New Indictments & Complaints . 
Date Case Description 



Commonwealth v. Kimberly Pergola 
(Larceny Prosecution) 

(AAG M. Parks) 



DEFENDANT DESCRHTION: Defendant was a former Bookkeeper for 
MCLE indicted for larceny and false entry into corporate books. 

COUNTIES CHARGED: Suffolk 

CHARGES : 2 Counts Larceny over $250 

1 Count False Entry in Corporate Books 



Commonwealth v. Joseph Pereira 
(Larceny Prosecution) 
(AAG K. Brekka) 

DEFENDANT DESCRD7TION: Defendant indicted for 
larceny scam involving multiple victims. 

COUNTffiS CHARGED: Bristol 

CHARGES : 2 Counts Larceny Over $250 

1 Counts Unauthorized Practice of Law 



Commonwealth v. Constance Spares 
(Larceny and Tax Prosecution) 

(AAG J. Bryant) 

DEFENDANT DESCRD7TION: Defendant indicted for larceny, forgery and 
failure to file income tax returns involving her work as a secretary and care giver 
for a victim suffering from Alzheimer's disease. 

COUNTffiS CHARGED: Bristol 

CHARGES : 2 Counts Larceny Over $250 

4 Counts Forgery 

5 Counts Failure to File Income Tax Returns 



78 



8/95 Commonwealth v. Jeffrey Gruber 

(Larceny Prosecution) 

(AAG J. Bryant) 



DEFENDANT DESCRD?TION: Defendant was charged with theft of 
insurance premium monies from multiple victims, some of whom are elderly, 
while working as a former insurance agent. 

COUNTIES CHARGED: Norfolk 

CHARGES: 5 Counts Larceny over $250 

1 1 Counts Forgery 
1 1 Counts Uttering 



10/95 Commonwealth v. Jason Roberts 

(Larceny and False Tax Prosecution) 

(AAG M. Parks) 



DEFENDANT DESCRIPTION: Former Juvenile Diabetes Chapter President 
was charged with larceny and willful filing of false tax returns. 

COUNTIES CHARGED: Norfolk and Suffolk 

CHARGES: 4 Counts Larceny over $250 

4 Filing False Tax Returns 



10/95 Commonwealth v. Harriet Roberts 

(Larceny and Tax Prosecution) 

(AAG M. Parks) 



DEFENDANT DESCRIPTION: Former Juvenile Diabetes Chapter Treasurer 
was charged with larceny and willful filing of false tax returns. 

COUNTIES CHARGED: Norfolk and Suffolk 

CHARGES: 

7 Counts Larceny over $250 

1 Counts Forgery 

4 Filing False Tax Returns 



10/95 Commonwealth v. Thomas Suida 

(Larceny Prosecution) 

(AAG J. Benzan) 



DEFENDANT DESCRIPTION: This case involves three co-defendants 
stealing and converting bearer coupons from State Street Bank. 



79 



COUNTIES CHARGED: Suffolk 
CHARGES: 3 Counts Larceny over $250 

Commonwealth v. Andrew McKnight 
(Larceny Prosecution) 
(AAG J. Benzan) 

DEFENDANT DESCRIPTION: This case involves three co-defendants 
stealing and converting bearer coupons from State Street Bank. 

COUNTIES CHARGED: Suffolk 

CHARGES: 3 Counts Larceny over $250 

Commonwealth v. Richard Kelly 
(Larceny Prosecution) 

(AAG J. Benzan) 

DEFENDANT DESCRD7TION: This case involves three co-defendants 
stealing and converting bearer coupons from State Street Bank. 

COUNTD2S CHARGED: Suffolk 

CHARGES: 3 Counts Larceny over $250 



Commonwealth v. John M. Burgess and Nancy J. Burgess 
(Larceny Prosecution) 
(AAG M. Parks) 

DEFENDANT DESCRD7TION: Defendants, as part of 

husband and wife team, indicted for larceny scam involving multiple victims and 

real estate transactions. 

COUNTffiS CHARGED: Bristol 

CHARGES: 6 Counts Larceny Over $250 

4 Counts Conspiracy to Commit Larceny Over $250. 



Commonwealth v. Kurt Blaha and James Lavcock 
(Insurance Fraud Prosecution) 
(AAG K. Brekka) 

DEFENDANT DESCRHTION: Both Defendants are 

indicted for fraudulently submitting an insurance claim regarding a stolen 



80 



COUNTIES CHARGED: Plymouth 

CHARGES: 1 Count of Filing False Maritime Report 

1 Count Fraudulent Insurance Claim 
1 Count Attempt to Commit a Crime. 



1 1/95 Commonwealth v. Nancy Gonelli 

(Larceny Prosecution) 
(AAG S. Kelly) 



DEFENDANT DESCRD7TION: Defendant indicted for alsifying 
reimbursement vouchers for allegedly job-related expenses. 

COUNTIES CHARGED: Middlesex 

CHARGES: 1 Count Larceny over $250 

15 Counts Uttering False Instrument 

15 Counts Forgery 

15 Counts False Entry in Corporate Books 



1/96 Commonwealth v. Stephen Perry 

(USAO-AGO Joint Prosecution) 

(Elderly V/Ws) 

(AAG Kelly) 

DEFENDANT DESCRIPTION: Former investment advisor charged with defrauding 
former clients by convincing them to invest in phony investment schemes. 

COUNTffiS CHARGED: N/A (Federal District Court) 

CHARGES: Mail Fraud 
Wire Fraud 
Interstate Transportation of Stolen property 

2/96 Commonwealth v. John M. Burgess 

(Larceny Prosecution) 

(Elderly V/Ws) 
(AAG Parks) 

DEFENDANT DESCRHTION: Defendant, as part of a husband and wife team, 
indicted for larceny scam involving multiple victims in connection with fake real estate 
transactions. 

COUNTffiS CHARGED: Norfolk 

CHARGES: 3 Counts of Larceny Over $250 



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Commonwealth v. Joseph Pereira 
(Larceny Prosecution) 
(AAG Brekka) 

DEFENDANT DESCRD7TION: Defendant is Fall River Businessman indicted for 
misrepresenting himself as an agent of Housing and Urban Development, persuading a 
small business owner to hand over $10,000 as part of an application to obtain a loan to 
refurbish his restaurant. 

COUNTIES CHARGED: Suffolk 

CHARGES: 1 Count of Larceny Over $250 



Commonwealth v. Robert Russo 
(Tax Prosecution) 

(SPAAG Zaikis) 

DEFENDANT DESCRIPTION: Defendant, a Peabody, MA resident, was indicted 
for Willful Filing False Tax Returns and Larceny Over $250 for submitting eight 
fraudulent tax returns using aliases and fake W-2s, and then converting the refund 
checks subsequently received based on those fraudulent returns. 

COUNTIES CHARGED: Suffolk 

CHARGES: 8 Counts of Willful False Filing 
of Tax Returns 
7 Counts of Larceny Over $250 



Commonwealth v. Todd Taylor 
(Larceny Prosecution) 
(AAG M.Cassidy) 

DEFENDANT DESCRflPTION: Defendant was an employee who stole $100,000 
while working for the New England Conservatory of Music. 

COUNTDZS CHARGED: Suffolk 

CHARGES: 4 Counts of Larceny Over 



82 



3/96 Commonwealth v. John M. Burgess and Nancy J. Burgess 

(Larceny Prosecution) 

(AAG Parks) 

DEFENDANT DESCRD7TION: Defendant John Burgess is indicted for larcenies 
from four victims, and his wife Nancy Burgess is indicted in connection with two of 
those. One case relates to a fraudulent mortgage scheme, one case to a fraudulent 
business partnership, and the other cases involve fraudulently obtaining/using funds 
intended for use as real estate deposits. 

COUNTIES CHARGED: Middlesex 

CHARGES: 6 Counts Larceny Over $250 
2 Count Conspiracy 



4/96 Commonwealth v. Scott Sutherland 

(Tax Prosecution) 
(AAG S.Kelly) 

DEFENDANT DESCRIPTION: This defendant ran sole proprietorship and is 
charged with evasion, false returns, and failure to account for and pay sales tax. 

COUNTIES CHARGED: Suffolk 

CHARGES :Tax Evasion Willful Failure to Accoun For & Pay Over Sales Tax 
Filing False Returns 



4/96 Commonwealth v. Paul DeRoche 

(Tax Prosecution) 
(AAG S.Kelly) 



DEFENDANT DESCRD7TION: This defendant is a former CPA who failed 
to file returns. 

COUNTERS CHARGED: Suffolk 

CHARGES: Failure to File 



83 



Commonwealth v. Leonard Amaral 
(Tax Prosecution) 
(SPAAG A. Zaikis) 



DEFENDANT DESCIUPTION: Tax protestor who was prosecuted by this 
office and sent to jail has continued not to file returns since his release from 
incarceration. 

COUNTY CHARGED: Suffolk 



CHARGES: 4 Counts Willful Failure To File State Income Tax Returns 



Commonwealth v. Donald Constant 
(Tax Prosecution) 

(SPAAG A. Zaikis) 

DEFENDANT DESCRD7TION: New Bedford area attorney who has evaded 
taxes through the filing of false tax returns and failure to file withholding tax 
returns for his employees. 

COUNTY CHARGED: Suffolk 

CHARGES: 4 Counts Willful Attempt To Evade Income Taxes 

3 Counts Filing False Tax Returns 

5 Counts Willful Account For Withholding Taxes 



Commonwealth v. William Dispirito 
(Tax Prosecution) 
(SPAAG A. Zaikis) 

DEFENDANT DESCRD7TION: Owner of several textile corporations who 
withheld taxes from his employees' wages but never turned over the taxes to the 
state while also failing to file excise tax returns for his corporations. 

COUNTY CHARGED: Suffolk 

CHARGES: 1 Count Willful Failure To Account For & Pay Over 
Withholding Taxes 
1 Count Failure To File Corporate Excise Tax Returns 



84 



4/96 Commonwealth v. Arthur Stephen Lane 

(Tax Prosecution) 
(SPAAG A. Zaikis) 



DEFENDANT DESCRD7TION: Marketing consultant who 
failed to file any returns for several years. 

COUNTY CHARGED: Suffolk 

CHARGES: 4 Counts Willful Failure To File State 
Income Tax Returns 



4/96 Commonwealth v. Scott F. Sidell 

(Tax Prosecution) 
(SPAAG A. Zaikis) 



DEFENDANT DESCRD7TION: Operations manager who failed 

to file any returns for several years. 

COUNTY CHARGED: Suffolk 

CHARGES: 4 Counts Willful Failure To File State Income Tax Returns 



4/96 Commonwealth v. Mark N. Schlafman 

(Tax Prosecution) 
(SPAAG A. Zaikis) 



DEFENDANT DESCRIPTION: Business executive who filed false tax 
returns for several years. 

COUNTY CHARGED: Suffolk 

CHARGES: 3 Counts Willful Filing Of False Income Tax Returns 



4/96 Commonwealth v. Harvey Brower 

(Tax Prosecution) 
(SPAAG A. Zaikis) 



DEFENDANT DESCRIPTION: Disbarred attorney who earned and stole 
funds for several years from former clients while paying no income taxes on the 
amounts. 

COUNTY CHARGED: Suffolk 

CHARGES: 3 Counts Willful Attempt To Evade and Defeat Income Taxes 



85 



Commonwealth v. Edward Weld 
(Tax Prosecution) 
(SPAAG A. Zaikis) 

DEFENDANT DESCRD7TION: Business owner who filed to file any income 
tax returns for several years. 

COUNTY CHARGED: Suffolk 

CHARGES: 6 Counts Willful Failure To File State Income Tax Returns 

Commonwealth v. Manuel Reposa 
Commonwealth v. L.H. Burlingame, Inc. 
(Tax Prosecution) 
(SPAAG A. Zaikis) 

DEFENDANT DESCRD7TION: President and owner of corporation that ran 
garden and tool supply stores for several years while failing to account for and 
pay over sales and withholding taxes and failing to file excise tax returns. 

COUNTY CHARGED: Suffolk 

CHARGES: 1 Count Willful Failure To Account For & Pay Over 
Withholding Taxes 

1 Count Willful Failure To Account For & Pay Over 
Sales Taxes 

1 Count Failure To File Corporate Excise Tax Returns 
(Manuel & the corporation) 



Commonwealth v. Carole Caron 
(Tax Prosecution) 

(SPAAG A. Zaikis) 

DEFENDANT DESCRD7TION: Carpet store owner who 

operated for several years without paying over any collected sales taxes. 

COUNTY CHARGED: Suffolk 

CHARGES: 1 Count Willful Failure To Account For & 
Pay Over Sales Taxes 



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4/96 Commonwealth v. Richard J. Shaer 

(Tax Prosecution) 
(AAG S.Hartry) 



DEFENDANT DESCRD7TION: This case involves failure to pay income 
taxes, where the taxpayer consistently filed yearly returns that indicated a 
substantial liability, but neglected to include a check with the returns. 

COUNTIES CHARGED: Suffolk 

CHARGES: 4 Counts Failure To Pay 



4/96 Commonwealth v. John Bolduc 

(Tax Prosecution) 
(SPAAG A. Zaikis) 



DEFENDANT DESCRTPTION: Deputy tax collector for dozens of cities and 
towns in the state, this defendant evaded personal income taxes and failed to pay 
over any withholding taxes for his employees. 

COUNTY CHARGED: Suffolk 

CHARGES: 4 Counts Willful Filing Of False Income 

Tax Returns 

4 Counts Willful Attempt To Evade Income Taxes 

1 Count Willful Failure To Account For Withholding Taxes 



4/96 Commonwealth v. Steve Button 

(Tax Prosecution) 
(SPAAG L. Balboni) 



DEFENDANT DESCRD7TION: Defendant indicted for filing no state income 
taxes while operating a video production business and receiving more than 
$550,000 in receipts during a 5 year period. 

COUNTDZS CHARGED: Suffolk 

CHARGES: 5 Counts Willful Failure To File Taxes 



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Commonwealth v. Domingo Pena and Domingo's Olde 

Restaurant 

(Tax Prosecution) 

(AAG K.Brekka) 

DEFENDANT DESCRD7TION: This defendant Pena is the owner and 
president of Domingo's Olde Restaurant. Pena operated the restaurant in E. 
Falmouth and was responsible for the bookkeeping and payment of taxes. 

The defendants are charged in regard to unpaid meals taxes. 

COUNTIES CHARGED: Suffolk 

CHARGES: 1 Count Willfully Evading Meals Taxes 
1 Count Failure to Pay Meals Taxes 



Commonwealth v. John G. Curtis 
(Larceny Prosecution) 
(AAG K.Brekka) 

DEFENDANT DESCRIPTION: This defendant was the head of Star Market's 
Maintenance Department, in charge of all re-supply and purchasing orders. In 
that capacity, he misappropriated funds that were made payable to Star Market. 



COUNTDZS CHARGED: Suffolk 
CHARGES: 1 Count Larceny Over $250 



Commonwealth v. Melinda L. Lowe 
(Tax Prosecution) 

(AAG Parks) 

DEFENDANT DESCRD7TION: Defendant Melinda Lowe was the 
bookkeeper for J & M Taylor, Co., Inc., a close corporation which runs 3 motels 
in Falmouth. Lowe was the corporate employee responsible for filing returns for 
and paying over room occupancy tax. In 1991, she failed to file and to pay over 
the taxes owing for 3 monthly periods; in 1992, she failed to file and to pay taxes 
for 5 periods; and in 1993, she failed to pay any taxes. In all, the taxes not paid 
exceeded $250,000. 

COUNTffiS CHARGED: Suffolk 

CHARGES: 3 Counts Willful Failure to Account for 

and Pay Over Room Occupancy Taxes 

3 Counts Willful Failure to File Room Occupancy Tax Returns. 



88 



5/96 Commonwealth v. J & M Taylor Co., Inc. 

(Tax Prosecution) 

(AAG Parks) 



DEFENDANT DESCRD7TION: See defendant Melinda Lowe 
above. 

COUNTIES CHARGED: Suffolk 

CHARGES: 3 Counts Willful Failure to Account for 
and Pay Over Room Occupancy Taxes. 



6/96 Commonwealth v. Shing He "Ed" Lau , Rebecca Mok Lau, Odon "Danny 

DoVale, Man Kin "Daily" Chan, Po Foon "Tim" Lam. Hus Pei Chiang. London 

and Global. Inc. 

(Larceny Prosecution) 

(AAG K. Brekka; Jeremy Silverfine; 

John Grossman) 

DEFENDANT DESCRIPTION: Defendants were integral participants in the 
London and Global currency investment scam. 

COUNTIES CHARGED: Suffolk, 

CHARGES: Larceny, G.L. c. 266, § 30 (4 counts); 
Keeping a Bucket Shop, G.L c. 271,§ 36(4 counts); 
Securities Fraud, G.L. c. 110A, § 101 (4 counts); 
False Corporate Records, G.L. 266,§ 92 (1 count); 
Conspiracy, G.L. c. 274, § 7 (6 counts); 
Perjury, G.L. c. 268 § 1 (1 count). 



VI. CASES DISPOSED FISCAL YEAR 1996 

Conviction Date Case Description 

7/95 Commonwealth v. Orville P. Stammen 

(Larceny Prosecution) 
(AAG Parks) 

COURT: Suffolk Superior Court 

JUDGE: Thayer Fremont-Smith 

REFERRAL: N/A 
CHARGES: 1 Count Larceny Over $250 

1 Count Receiving Stolen Property 

1 Count Forgery 

1 Count Uttering 

1 Count Counterfeiting a Driver's License 



89 



SENTENCE: 2 years HOC on Larceny charge, with 1 year HOC from 
and after, and 2 years probation with restitution on 
remaining charges. 
$50 Victim/witness fee. 



7/95 



Commonwealth v. Paul Davis 
(Larceny/Insurance Fraud Prosecution) 

(AAG Brekka) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Worcester Superior Court 

Snyder 

IFB 

1 Count Larceny Over $250 

1 Count Insurance Fraud 

1 Count Forgery 

1 Count Uttering 



SENTENCE: 1 Year HOC, sentenced suspended for 1 year, $4,000 
restitution, and $500 fine. Unsupervised probation. 
No victim witness fee. Waived by court. 



7/95 



Commonwealth vs. John H. Rogers, 
(Tax Prosecution) 

(AAG Kelly) 



III 



COURT: Suffolk Superior Court 

JUDGE: Margaret Hinkle 

REFERRAL: DOR 

CHARGES: Willful Failure to File Taxes 

SENTENCE: 6 months HOC, 3 days to serve, balance sentenced 

suspended for 2 years. Cooperate with DOR's Civil 

Audit and Recovery Division to assess back taxes, 

probation fee. 

$50 Victim/witness fee. 



7/95 Commonwealth vs. Raymond Shimkus 

(Larceny and Tax Prosecution) 

(AAG Zaikis) 

COURT: Suffolk Superior Court 
JUDGE: Borenstein 
REFERRAL: DOR 

CHARGES : 1 Count Larceny over $250 

1 Count Sale of Unregistered -Securities 

1 Count Tax Evasion 

1 Count Filing of False Returns 



90 



SENTENCE: 



5 Years probation, full 

restitution to larceny 

victims. 

$50 Victim/witness fee. 



8/95 Commonwealth vs. Joseph Valeri 

(Larceny Prosecution) 
(AAG Bryant) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Suffolk Superior Court 

Borenstein 

N/A 

9 Counts Larceny Over $250 

2 Counts of False Entry 



SENTENCE: 



1 Year HOC, and 400 hours of community service. $5,000 fine 
and $50 victim/witness fee. 



8/95 Commonwealth vs. James June 

(Larceny Prosecution) 

(AAG Zaikis) 

COURT: Suffolk Superior Court 

JUDGE: Freemont-Smith 

REFERRAL: DOR 

CHARGES: 1 Count Larceny Over $250 



SENTENCE: 



4 Years, 364 days to 5 years state prison, $50 victim/ witness 
fee. 



9/95 Commonwealth vs. Joseph A. Lombardi, Sr. 

(Tax Prosecution) 

(AAG Kelly) 

COURT: Suffolk Superior Court 

JUDGE: DOR/CIB 

REFERRAL: DOR 

CHARGES: 4 Counts Willful Failure to File State Taxes 
SENTENCE: 1 Year HC, suspended for 2 years. To cooperate with DOR 
for payment of tax liability, $50 victim/witness fee. 



10/95 Commonwealth vs. Walter Downing 

(Insurance Fraud Prosecution) 

(AAG Brekka) 



91 



COURT: Middlesex Jury of Six 

JUDGE: Covan 

REFERRAL: JPB 

CHARGES: 1 Count Insurance Fraud 

1 Count Attempt to Commit a Crime. 



SENTENCE: 



1 Year probation, $500 
restitution. Victim/witness 
fee waived by court. 



10/95 Commonwealth vs. E. Paul Tinsley 

(Tax Prosecution) 

(AAG Zaikis) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Hampden Superior Court 

Welch 

DOR 

1 Count Filing False Claims 



SENTENCE: 



$10,000 fine, $54,000 restitution, and 200 hours community 
service. $50 Victim/ witness fee. 



10/95 Commonwealth vs. Insurance Cost Control 

(Tax Prosecution) 
(AAG Zaikis) 

COURT: Hampden Superior Court 

JUDGE: William Welch 

REFERRAL: DOR 

CHARGES: 2 Counts Filing False Claims 

SENTENCE: $20,000 fines; $7 1 ,00 restitution. $50 Victim/ witness fee. 



10/95 Commonwealth vs. Debra Smith 

(Larceny Prosecution) 

(AAG Kelly) 

COURT: Hingham District Court 

JUDGE: Hurley 

REFERRAL: N/A 

CHARGES: 1 Larceny Over $250 

SENTENCE: 2 Years, 60 days to serve. Balance suspended for 3 years. 
Stayed for 1 week. Restitution $12,212, drug testing and 
counseling. Ordered that the defendant not 
have sole authority over employer's non-personal funds during 
probation. 



92 



10/95 Commonwealth vs. David A. Wall 

(Larceny/Worker's Compensation 
Prosecution) 

(AAG Kelly) 

COURT: Suffolk Superior Court 

JUDGE: Volterra 

REFERRAL: City of Boston Worker'sCompensation Service CID/PPB 

CHARGES: 1 Count Attempted Larceny 

3 False Claim Against Commonwealth 

2 Counts Larceny Over 2 

Counts Worker's Compensation Fraud 

SENTENCE: 1 Year HC, 6 months to serve, balance suspended; alcohol 

treatment and counseling, $30 probation fee to run concurrent 
as to each count. 



10/95 Commonwealth vs. David Bourinot 

(Worker's Compensation 
Prosecution) 

(AAG Brekka) 

COURT: Maiden District Court 

JUDGE: Covin 

REFERRAL: IFB 

CHARGES: Worker's Compensation Fraud 

SENTENCE: Sentenced to 1 year probation $5,000 restitution or 500 hours 
community service. 
Victim/witness fee waived by court. 

10/95 Commonwealth vs. Thomas Wolpert 

(Tax Prosecution) 
(AAG Zaikis) 

COURT: Suffolk Superior 

JUDGE: Volterra 

REFERRAL: DOR 

CHARGES: 1 Count Willful Failure to Account and Pay Over Sale Taxes 

SENTENCE: $5,000 fine, $50 victim/witness fee. 



93 



10/95 Commonwealth vs. John I. Anzalone 

(Larceny Prosecution) 
(AAG Starkey) 

COURT: Suffolk Superior 

JUDGE: Volterra 

REFERRAL: Norfolk District Attorney's Office 

CHARGES : 1 6 Larceny Over 

2 Counts Uttering 

3 Larceny Relating to Banks 

SENTENCE: Common & Notorious Thief 

Adjudication on 001, 002, 003 - 9-10 years; MCI Cedar 
Junction, suspended for 5 yrs., w/probationary conditions that 
1) $10,000 payment up front; 2) $750 direct payment from 
employer to probation per month; 3) order of 5 yrs. probation 
to be extended for 5 additional years until restitution is paid in 
full; 4) defendant to be surrendered to the 9-10 year sentence if 
he either fails to pay monthly restitution, or does anything to 
harm his ability to pay $750 restitution; 5) $750 per month 
payments to increase to $1,000 per month after federal 
restitution paid in full; and 6) $50 victim-witness fee. 



10/95 Commonwealth vs. Jane P. McNally 

(Tax Prosecution) 
(AAG Zaikis) 

COURT: Suffolk Superior 

JUDGE: Volterra 

REFERRAL: DOR 

CHARGES: 4 Counts Willful Failure to File State Income Tax Returns 

SENTENCE: Probation 1 year, ordered to pay a criminal fine of $5,000 and 
will still be responsible for the payment of $10,000 in back 
taxes along with interest and civil penalties. $50 
Victim/witness fee. 



10/95 Commonwealth vs. Philip H. Smith 

(Tax Prosecution) 

(AAG Zaikis) 

COURT: Suffolk Superior 

JUDGE: Volterra 

REFERRAL: DOR 

CHARGES: Failure to Pay Sales Taxes 



94 



SENTENCE: Pled guilty to willfully failing to account for and pay over 

sales taxes, ordered to pay a criminal fine of $5,000 and will 
still be responsible for the payment of back taxes along with 
interest and civil penalties. $50 Victim/witness fee. 



10/95 



Commonwealth vs. Geno Impemba 
(Public Corruption Prosecution) 

(AAG Kelly) 



COURT: Middlesex Superior 

JUDGE: Chemoff 

REFERRAL: Massachusetts State Police/US Secret Service 

CHARGES: 1 1 Counts Counterfeiting 

SENTENCE: 1 Year HOC, 90 days to serve, balance suspended for 3 
years probation on one 10 count indictment, and to 3 to 
5 five years at MCI Cedar Junction, suspended for 3 
years of probation, on a second indictment, to run from 
and after the first sentence. The judge further ordered 
that the defendant perform 100 hours of community 
service. 
$50 Victim/witness fee. 



10/95 



Commonwealth vs. John W. Kilev, Jr. 
(Tax Prosecution) 

(AAG C. Starkey) 



COURT: Suffolk Superior Court 

JUDGE: King 

REFERRAL: N/A 

CHARGES : 9 Counts False Filing of Taxes 

SENTENCE: Two 1/2 years to HOC,suspended for 3 years of 

probation, with a total of $100,000 fines, ordered to pay 
$25,000 up front in certified check, the remaining 
$75,000 to be paid probation on a schedule they are to 
determine. 



95 



10/95 



Commonwealth vs. Atlantic Broom Service, Inc. 
(Tax Prosecution) 
(AAG Starkey) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



SENTENCE: 



Suffolk Superior Court 

King 

N/A 

1 Count False Filing of 

Corporate Taxes 

1 Count Failure to Pay Sales Tax 

Guilty all counts. Sentence imposed on president and 

owner of company, John W. Kiley, Jr. 



11/95 



Commonwealth v. Richard C. Tribuna 
(Tax Prosecution) 
(AAG Parks) 



COURT: Suffolk Superior Court 

JUDGE: Rouse 

REFERRAL: DOR 

CHARGES: 1 Count Willful Filing FalseReturn 

1 1 Counts Filing False Claims Against The 

Commonwealth 

SENTENCE: 2 1/2 years HC, 6 mos. to serve, balance suspended for 
3 years of probation, to be served from and after federal 
sentence. Restitution of $2,258.00. 
$50 v/w fee. 



11/95 



Commonwealth vs. Kevin Aliengena 

(Tax Prosecution) 

(AAG Zullas) 

COURT: Suffolk Superior Court 

JUDGE: Volterra 

REFERRAL: DOR 

CHARGES: 4 Counts Willful Failure to File State Tax Returns 



SENTENCE: 



6 mos. HC, suspended for 3 years; $4,000 fine plus 
$1,000 surfine, and payment of back taxes and fines. 



11/95 



Commonwealth vs. Kimberly A. Pergola 

(Larceny Prosecution) 

(AAG Parks) 

COURT: Suffolk Superior Court 

JUDGE: Volterra 

REFERRAL: N/A 



96 



CHARGES: 2 Counts Larceny Over $250; 

1 Count Making False Entries in Corporate Books 

SENTENCE: 2 years HC, suspended for 1 year with probation, 

$75,000 restitution paid forthwith. Concurrent sentence 
imposed of 1 year HC, suspended for 1 year. $50 v/w 
waived by Judge . 



11/95 



Commonwealth v. Jocelvn Gaston 
(Larceny/Insurance Fraud Prosecution) 

(AAG Brekka) 



COURT: Worcester District Court 

JUDGE: Benton 

REFERRAL: IFB 

CHARGES: 1 Count Motor Vehicle Fraud 

1 Count Attempted Larceny Over $250 

SENTENCE: 6 mos. probation; $1 ,000 restitution with concurrent 
sentence of 6 mos. probation. $50 v/w fee waived by 
Judge. 



11/95 



Commonwealth v. Fritz Molard 
(Insurance Fraud Prosecution) 

(AAG Brekka) 



COURT: Worcester District Court, Jury Session 

JUDGE: Fox 

REFERRAL: JFB 

CHARGES: 1 Count Motor Vehicle Insurance Fraud 
1 Count Attempt to Commit a Crime. 

SENTENCE: 2 Years HC, 6 mos. to serve, balance suspended with 
supervised probation, $1,500 restitution. 
$50 v/w fee waived by Judge . 



97 



1 1/95 Commonwealth v. Kenneth Chambers 

(DET Prosecution) 

(AAG Kelly) 

COURT: Lowell District Court 

JUDGE: Mori 

REFERRAL: DET 

CHARGES: 1 Count Attempted Larceny Over $250 

SENTENCE: 1 year probation, $680 restitution plus interest and 
penalties. 
$50 v/w fee. 



1 1/95 Commonwealth v. John D. DiVecchia 

(DET Prosecution) 

(AAG Kelly) 

COURT: Wobum District Court 

JUDGE: Gilgun 

REFERRAL: DET 

CHARGES : 2 Counts of Unemployment Fraud 

SENTENCE: 1 year probation, $492 restitution plus interest and 
penalties. 
$50 v/w fee. 



1 1/95 Commonwealth v. Paul Malfy 

(DET Prosecution) 
(AAG Kelly) 

COURT: Woburn District Court 

JUDGE: Gilgun 

REFERRAL: DET 

CHARGES: 1 Count of Unemployment Fraud 

SENTENCE: 1 year probation, $ 1 85 restitution plus interest and 

penalties. 

$50 v/w fee. 

11/95 Commonwealth v. Kenneth Swart 

(DET Prosecution) 

(AAG Kelly) 

COURT: Woburn District Court 

JUDGE: Gilgun 

REFERRAL: DET 

CHARGES: 1 Count Unemployment Fraud 



98 



SENTENCE: 1 year probation, $ 1 80 restitution, plus interest and 
penalties. 



1 1/95 Commonwealth v. Donald Rathbum 

(DET Prosecution) 

(AAG Kelly) 

COURT: Woburn District Court 

JUDGE: Gilgun 

REFERRAL: DET 



CHARGES: 2 Counts Unemployment Fraud 

SENTENCE: 1 year probation, $410 restitution plus interest penalties. 
$50 v/w fee. 



1 1/95 Commonwealth v. Donald Rathbum 

(DET Prosecution) 

(AAG Kelly) 

COURT: Lowell District Court 

JUDGE: Mori 

REFERRAL: DET 

CHARGES: 1 Count Unemployment Fraud 

SENTENCE: 1 year probation, $410 restitution plus interest penalties. 
$50 v/w fee. 



1 1/95 Commonwealth v. Kenneth Swart 

(DET Prosecution) 

(AAG Kelly) 

COURT: Lowell District Court 

JUDGE: Mori 

REFERRAL: DET 

CHARGES: 1 Count Unemployment Fraud 

SENTENCE: 1 year probation, $199 restitution, plus interest and 
penalties. 



1 1/95 Commonwealth v. Josephine White 

(Larceny Prosecution) 

(AAG Parks) 

COURT: Essex Superior Court 



99 



JUDGE: Grasso 

REFERRAL: N/A 

CHARGES : 1 3 Counts Larceny Over $250 
3 Counts Forgery 
3 Counts Uttering 
1 Count Attempted Larceny Over $250. 

SENTENCE: Adjudged Common & Notorious Thief; 12-8 years state 
prison, 6 years to serve, balance suspended for 5 years, 
to be served from and after 15 year Connecticut 
sentence. 
$50 v/w fee. 



11/95 



Commonwealth v. William Stadelmann 
(Tax Prosecution) 

(AAG Zaikis) 



COURT: Newbury Superior Court 

JUDGE: Rouse 

REFERRAL: N/A 

CHARGES: 5 Tax Evasion 

SENTENCE: 4-5 year suspended sentenced, probation for 4 years, 

ordered to pay criminal fine of $100,000 and to provide 
1,000 hours of electrical work to non-profit agencies. 
$50 v/w fee. 



11/95 



Commonwealth v. Group Benefits Strategies 
(Tax Prosecution) 

(AAG Zaikis) 



COURT: Suffolk Superior Court 

JUDGE: Volterra 

REFERRAL: N/A 

CHARGES: 1 Count Corporate Tax Evasion 

2 Counts False Tax Returns 
SENTENCE: $ 1 0,000 fine on each totalling $20,000. 



100 



11/95 



Commonwealth v. E. Paul Tinsley 
(Tax Prosecution) 

(AAG Zaikis) 



COURT: Suffolk Superior Court 

JUDGE: Volterra 

REFERRAL: N/A 

CHARGES: 1 Count Corporate Tax Evasion 

SENTENCE: $5,000 fine 



12/95 



Commonwealth v. Ralph DeFeo 

(Larceny/Worker's Compensation Fraud Prosecution) 
(AAG Kelly) 

COURT: Boston Municipal Court 

JUDGE: Somerville 

REFERRAL: PERA 

CHARGES: 1 Count Worker's Compensation Fraud 
1 Count Larceny Over $250. 



SENTENCE: Continued without a finding of 
1 year on each, restitution of 
$7,252.57 for both totalling $14,504.14. 



1/96 



Commonwealth v. Philip N. Burgess, Jr. 
(Tax prosecution)(Elderly V/Ws) 

(AAG Bryant) 



COURT: Suffolk Superior Court 

JUDGE: Bohn 

REFERRAL: DOR 

CHARGES: 1 Count Willful Failure To 

Turn Over and Pay Fuel Oil Taxes, amended to Failure 
To File Taxes as part of Agreed Upon Plea 
Recommendation. 

SENTENCE: 14 days in the House of 

Correction imposed, to be served on weekends, with full 
and immediate restitution to ble paid forthwith in the 
amount of $48,000.00. 



101 



3/96 



Commonwealth v. Shaun P. Corcoran 
(Larceny Prosecution) 

(AAG Parks) 



COURT: Middlesex Superior Court 

JUDGE: Zobel 

REFERRAL: Securities Division 

CHARGES : 1 3 Counts Larceny Over $250 

3 Counts Sale of Securities by Unregistered Person 
3 Counts Fraudulent Offer/Sale of Securities 
2 Counts Larceny by Check 

SENTENCE: 6-10 years at MCI Cedar Junction committed, followed 
by 2.5 - 3 years at MCI Cedar Junction suspended for 10 
years. 



3/96 Commonwealth v. S & C Concrete Floors & 

Company, Inc. 
(DET Prosecution) 
(AAG Kelly) 



Middlesex Superior Court 
Donovan 



COURT: 

JUDGE: 

REFERRAL: 

CHARGES: 1 Count Failure to Pay Prevailing Wages 

1 Count Failure to Keep True and Accurate Records 



SENTENCE: Pled guilty to charges. Failure to Pay Prevailing Wages - 
Received 6 months debarment and $10,000 fine; Failure to 
Provide True and Accurate Records - Received 6 months 
debarment and $2,000 fine; Failure to Keep True and Accurate 
Records - Received 6 months debarment and $2,000 fine. 

3/96 Commonwealth v. Stephen Hill 

(DET Prosecution) 

(AAG Kelly) 

COURT: Middlesex Superior Court 

JUDGE: Donovan 

REFERRAL: DET 

CHARGES: 1 Count Failure to Pay Prevailing Wages 

2 Counts Failure to Provide True and Accurate Records 
1 Count Failure to Pay Unemployment Contributions 

1 Count Failure to Provide with Worker's Compensation 
Insurance 

2 Counts Unemployment Fraud 
2 Counts Larceny Under $250 



102 



SENTENCE: Received 6 months debarment and $14,000 fine; 1 year HOC 
suspended for 5 years if all monies paid, suspended for 2 
years, $12,565 restitution plus interest, both Stephen and 
Christopher Hill jointly severally liable. Other charges 
concurrent with the latter plus restitution and fines. 



3/96 Commonwealth v. Irving Shubert 

(Larceny/Insurance Fraud Prosecution) 
(AAG Brekka) 

COURT: Norfolk Superior Court 

JUDGE: Hamlin 

REFERRAL: Insurance Fraud Bureau 

CHARGES: Suffolk - 5 Counts Larceny over $250.00 

5 Counts Filing Fraudulent Motor Vehicle Insurance Claim 

4 Counts Larceny Under $250 

1 Count Attempt to Commit a Crime 

Norfolk - 6 Counts Larceny over $250.00 

7 Counts Filing Fraudulent Motor Vehicle Insurance Claim 

4 Counts Larceny Under $250 

3 Counts Attempt to Commit a Crime 

SENTENCE: 59 days incarceration, five years probation, three months 

bracelet program, 100 hours community service and $56,000 

restitution. 

Victim witness fee ordered. 

3/96 Commonwealth v. Ronald Arnott 

( Lan-env /Medicaid Fraud Prosecution) 
(AAG Hartry) 

COURT: Suffolk Superior Court 

JUDGE: McDaniel 

REFERRAL: N/A 

CHARGES : 4 Counts Larceny Over $250 

5 Counts Medicaid False Claims 

SENTENCE: 3 to 5 years State Prison suspended for 10 years with 

supervised probation, 100 hours community service per year of 
probation, $120,000.00 restitution, provide $30,000 of shoe 
inventory to homeless shelters across the state, $50 victim 
witness fee. 



103 



Commonwealth v. James Morgan , 
(Larceny Prosecution) 
(co-defendant to Thomas Spencer) 
(AAG Brekka) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Barnstable Superior 
O'Neill 

1 Count Larceny over $250.00 

1 Count Receiving Stolen Property (1 count, filed without a 

change of plea) 



SENTENCE: 3-5 years State Prison, 

Suspended; 500 hours community service. Victim witness fee 
ordered. The community service will be performed in Essex 
County. The plea was in Barnstable, but the Defendant lives 
in New Hampshire. The Probation Department will be making 
the determination of the program for which the Defendant will 
serve. 



4/96 Commonwealth v. Joseph Pereira, 

(Larceny Prosecution) 

(AAG Kevin Brekka co-counsel 
with Jeremy Silverfine) 

COURT: Taunton Superior 

JUDGE: Hely 

REFERRAL: Fall River, State Police 

CHARGES: 12 Counts Larceny over $250.00 

1 Count Unauthorized practiceof law 
3 Counts Forgery 

2 Counts Uttering of a forged 
instrument 

1 Count Uttering of a 
worthless bank bill 

SENTENCE: The defendant was sentenced to four consecutive sentences of 

2 years-6 months to 2 years-7 months, 15 months to serve, 
$1 19,000.00 restitution, $60,000.00 of which was paid on the 
date of sentencing, the balance paid in increments 5,000.00 
every 6 months. 

Probation for 7 years. 
Victim witness fee ordered. 



104 



5/96 



Commonwealth v. Weld 
(Tax Prosecution) 

(SPAAG Zaikis) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Suffolk Superior 

Lopez 

DOR 

6 Counts Failure to File Tax 

Returns 



SENTENCE: $12,000 fine ($2,000 per yar) and Guilty finding as to al 
counts. Defendant ordered to pay fine in full by 5/2/96. 



5/96 Commonwealth v. Richard DiChiara , 

(Larceny/Worker's Compensation Fraud 
Posecution) 

(AAG Brekka) 

COURT: Middlesex Superior 

REFERRAL: IFB 

CHARGES: 1 Count Larceny over $250 

1 Count Worker's Compensation Fraud 



5/96 Commonwealth v. Kurt Blaha and James 

Lavcock , 

(Insurance Fraud Prosecution) 
(AAG Brekka) 



COURT: 
JUDGE: 
REFERRAL: 

CHARGES: 



Hingham District 

Dineen 

Environmental Police, Marine 

Division 

Laycock - 1 Count Filing a False Maritime Report 

1 Count Fraudulent Insurance Claim 

1 Count Attempt to Commit a Crime 

1 Count Conspiracy 



CHARGES: Blaha - 1 Count Filing a False 
Maritime Report 
1 Count Fraudulent Insurance Claim 



105 



6/96 Commonwealth v. Guido Petrosinelli 

Commonwealth v. Donuts of Swansea, Inc. 
(Tax Prosecution) 
(SPAAG Zaikis) 

COURT: Suffolk Superior Court 

JUDGE: Freemont-Smith 

REFERRAL: DOR 

CHARGES: 1 Count Willful Failure To 

Account For & Pay Over Meals Taxes 

1 Count Willful Attempt ToEvade & Defeat Meals Taxes 

SENTENCE: On the corporation and individual ordered to be jointly 

responsible for the payment of a criminal fine of $40,000. The 
individual defendant was also placed on probation for a year 
and ordered to perform 200 hours of community service. 



6/96 Commonwealth v. Wayne Clark, Jr. 

Commonwealth v. Wayne Clark, Sr. 
(Insurance Fraud Prosecution) 
(AAG Kelly) 



COURT: New Bedford Superior 

JUDGE: Donohue 

REFERRAL: JFB 

CHARGES: Clark, Jr. 

1 Count Concealing Stolen Motor Vehicle 
1 Count Concealing Motor 
Vehicle to Defraud Insurance 

SENTENCE: (Concealing Motor Vehicle) 

5 yrs. HOC suspended for 2 yrs. (Concealing Motor Vehicle to 
Defraud Insurance) Joint - 2 yrs. HOC suspended for 2 years; 
$7,500 restitution 
Removing VTNs - on file no change of plea 

CHARGES: Clark, Sr. 

1 Count Larceny Over $250 
1 Count Larceny Over $250 

SENTENCE: Joint recommendation 18 months HOC committed/concurrent 
joint recommendation 18 months suspended for 2 years on and 
after committed time. $12,000 restitution on one indictment; 
$17,455 restitution on second indictment. Commonwealth 
also recommended $4,543.76 for storage costs on one 
indictment/Court imposed "all other monies on terms and in 
amounts to be established by probation." Removing or 
Concealing MV to Defraud Insurer - Guilty - file. 



106 



6/96 Commonwealth v. Thomas Spencer . 

(Larceny Prosecution) 
(AAG Brekka) 

COURT: Barnstable Superior 

JUDGE: Tiemey 

REFERRAL: N/A 

CHARGES: 18 Counts Larceny Over $250.00 

SENTENCE: 4-5 years State Prison, 

suspended, one year bracelet program, Five years probation 
$5,378.76 restitution to homeowners (Fidelity Title Insurance 
Company seeking losses through civil suits against Spencer 
and co-defendant, James Morgan.) 



107 



ENVIRONMENTAL STRIKE FORCE 

I. Making the Government Work to Protect the Environment 

The Massachusetts Environmental Strike Force, a collaborative effort of the Attorney General, 
the Secretary of Environmental Affairs, Department of Environmental Protection, Environmental 
Police, and State Police, continued to pull together available governmental resources in the service of 
enforcing the state's environmental laws. The Strike Force also worked with the U.S. Environmental 
Protection Agency and U.S. Attorney's Office for the District of Massachusetts, pursuing joint 
state/federal environmental crimes investigations and participating in the U.S. Attorney's Clean Water 
Task Force. 

During Fiscal Year 1996, the Strike Force unit operating out of the Criminal Bureau of the 
Attorney General's Office initiated criminal prosecutions against six individual and corporate 
defendants. The Strike Force resolved cases against twelve defendants, obtaining eight convictions and 
one order of pretrial probation. The remaining three defendants were acquitted. In addition, the year 
saw the continued use of innovative environmental crime including sentences in environmental cases 
by the Strike Force, 
n. Criminal Case Highlights 

A. Cases Initiated in Fiscal Year 1996 

Com, v. H.C. Starck. Inc. 

This Massachusetts tantalum manufacturer was indicted by a Middlesex County grand jury for 
illegal treatment of hazardous waste. An explosion which occurred in connection with the company's 
hazardous waste treatment practices injured two employees. A second explosion took place after 
firefighters responded to the scene, injuring eleven of the firefighters. The indictments, charging 
treatment of hazardous waste in a manner which could endanger human health, and in a manner 
inconsistent with DEP regulations, were the first state charges ever brought for illegal hazardous waste 



108 



U.S. v. Alan P. Stevens 

Capping a joint state/federal investigation, this defendant was charged in federal court with wire 
fraud in connection with environmental testing and disposal of wastes. The Information alleged that 
the defendant purported to contract on behalf of laboratories to provide collection, testing and waste 
disposal services, knowing that such services would not be provided as represented and that resulting 
reports would be false and fraudulent. Drums of waste oil (including PCBs) collected by the defendant 
in connection with his scheme were allegedly dumped on unoccupied property in Peabody, 
Massachusetts. 

Com, v. Sylvester Products Co. 

This Massachusetts electroplating company was indicted by a Middlesex County grand jury for 
alleged illegal storage and attempted disposal of hazardous waste. The charges resulted from a tip 
received by the Strike Force that the company was about to cement over a concrete pit in its facility 
which contained hazardous plating sludge. 

B. Case Dispositions in Fiscal Year 1996 

Com, v. American Tissue Mills of Massachusetts, Inc. 

Com, v. Northeast Waste Treatment Services, Inc. 

These two companies were convicted in Worcester Superior Court on five counts of violating 
the Massachusetts Clean Waters Act. Northeast Waste, a subsidiary of American Tissue, operated the 
publicly-owned treatment plant in Templeton, Massachusetts. The two companies pled guilty to 
charges that they allowed pollutants to interfere with the POTW and pass through to the Otter River 
when they permitted a load of industrial waste to be discharged to the POTW. The pollution of the 
river caused an odor downstream, prompting complaints of nausea and headaches from local residents 
and children at a nearby school. The companies also pled guilty to failing to notify the DEP that they 
were accepting waste from industrial sources throughout New England in 1992. Evidence gathered by 



109 



the Strike Force investigation showed that the defendants benefitted financially by accepting the 
industrial wastes. The companies were sentenced to pay a fine of $125,000. 

Com, v. Krisco Corp. 

This defendant, which operates a MAACO auto body shop in Somerville, Massachusetts, was 
convicted in Middlesex Superior Court of illegally transferring hazardous waste to an unlicensed 
hauler, and without a hazardous waste manifest. In pleading guilty, the company admitted that on 
various dates in 1992, its employees dumped partially-full cans of flammable, solvent-based paints into 
its trash dumpster. The garbage truck which emptied the dumpster brought its contents to a solid waste 
transfer station, instead of a facility which could handle hazardous wastes. The company was ordered 
to pay $22,500 in fines. It paid an additional $7,500 to the Massachusetts Environmental Trust to 
create educational materials on hazardous waste disposal that will be distributed to auto body shops 
around the state. 

Com, v. Eugene McGurl 

In the first prosecution of a waste broker in Massachusetts, this defendant was convicted in 
Worcester Superior Court of violating the Massachusetts Clean Water Act. As a broker, the defendant 
served as a liaison between waste generators and waste disposal facilities. He arranged for the 
shipment of wastewater from a Maine plastics manufacturer to the publicly-owned treatment works in 
Templeton, Massachusetts. The plant, which discharges to the Otter River, was unable to treat the 
waste. The resulting pollution of the river caused an odor downstream, prompting complaints of 
nausea and headaches from local residents and children at a nearby school. The defendant pled guilty 
to causing a nuisance. He was sentenced to pay $28,125 in fines. He also paid $7,500 to the Millers 
River Watershed Council for its use in monitoring and improving the conditions of the Otter River. 

Com v. H.C. Starck. Inc. 

As noted above, this tantalum manufacturing company was indicted in Middlesex Superior 
Court for illegally treating hazardous waste. Upon conviction, the company was ordered to pay a 



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record $1,375 million in fines and penalties. $1.25 million of this sum went to the Environmental 
Challenge Fund, which is used in responding to hazardous materials releases. The defendant generated 
sodium waste in its manufacture of tantalum, a rare metal used in high-technology components such as 
jet engines and nuclear reactors. The company pled guilty to charges alleging that over a three-year 
period, it illegally burned sodium waste in a manner which could endanger human health, safety, 
welfare or the environment, and in a manner inconsistent with DEP regulations. The illegal practices 
culminated in two explosions, injuring two employees and eleven firefighters from Newton, 
Massachusetts. As part of the disposition obtained by the Strike Force, the defendant also made 
charitable contributions totaling $300,000 to the Massachusetts Firefighters Academy and the Shriners 
Burns Institute, agreed to conduct comprehensive environmental and occupational safety audits of its 
plant, and agreed to design and implement training courses, making them available to other 
manufacturers, to prevent the conditions which led to the explosions at the Starck plant. 

Com, v. Sylvester Products Co. 

This Marlborough plating company was convicted in Middlesex Superior Court of storing 
hazardous waste in a manner which could endanger human health, safety or the environment, and in a 
manner inconsistent with DEP regulations. The evidence showed that the company, which used 
various chemicals in its electroplating operations, stored plating sludge contaminated with hexavalent 
chromium (a known carcinogen) in a concrete pit in its facility in Marlborough for years. The 
company property is close to the Quabbin aqueduct and a drinking water well in Northborough. The 
company was sentenced to pay $12,500 in fines. 
HI. Creative Sentencing 

As may be seen from the above, the Strike Force continued to seek creative sentences intended 
to maximize the human health and environmental benefits of environmental law enforcement, by 
requiring companies which commit environmental crime to pay for their acts in a manner beneficial to 
the public. A Newton manufacturer agreed to conduct a comprehensive environmental and 



111 



occupational safety audit of its entire plant, reporting its results to the Commonwealth and other 
concerned local, state and federal regulatory agencies, and committing to correct all regulatory 
violations. This unprecedented state sentence should result in operations more protective of the local 
community, company employees, and the surrounding environment. Moreover, the company will 
design special trainings, for its own use and the use of other manufacturers, addressing the effective 
implementation of environmental and safety standards in the workplace, and the safe handling of 
ignitable and reactive materials and wastes. Another disposition will result in the production and 
distribution of educational materials to assist autobody shops in the safe handling of their hazardous 
wastes. In a third case, arising from the pollution of the Otter River, the local watershed association 
received moneys for use in monitoring and improving conditions of the river. 

Past creative sentencing efforts also continued to bear fruit. The Work Environment Justice 
Fund, created as a result of the Strike Force's 1994 prosecution of a Somerville lead smelting company, 
granted its second annual awards to seed projects for improving workplace health and safety among 
low income workers. A total of $100,000 was awarded to thirteen non-profit agencies across the state. 
NARCOTICS AND SPECIAL INVESTIGATIONS DIVISION 

The Narcotics and Special Investigations (NSI) Division coordinates and prosecutes complex, 
multi-jurisdictional criminal cases. It targets non-traditional organized criminal organizations and 
career criminals for prosecution. Additionally, the NSI Division investigates and prosecutes large- 
scale drug trafficking organizations and individuals involved in the illegal sale or possession of 
firearms. The Division also aids in the drafting of narcotics related legislation and the development 
and implementation of community education and outreach programs. 

The NSI Division, through its Asset Forfeiture Unit, also initiates and pursues civil and 
criminal forfeiture and nuisance actions of property related to the sale, distribution and facilitation of 
drug related offenses. Funds recovered by the Unit are disbursed in accordance with the 



112 



Commonwealth's forfeiture laws. A percentage of the amount forfeited is used for community-based 
drug awareness and education programs. 
OPERATION CLEAN SWEEP 

During the past year, the NSI Division continued with Operation "Clean Sweep". That 
initiative, which targets repeat drug offenders and persons distributing drugs in the vicinity of schools 
and/or playgrounds, was launched during fiscal year 1994-1995. It is designed to bring additional 
resources to local police departments to address specific problems arising from illegal narcotics 
distribution and related crimes occurring in local neighborhood. The operation, first initiated in the 
City of Waltham during the spring of 1995, has continued to be successful. 

During fiscal year 1995-1996, the NSI Division conducted two additional "Sweep" operations. 
The first was conducted in the City of Haverhill, where investigators assigned to the NSI Division, 
working with the Haverhill police and the Essex County Drug Task Force, arrested numerous 
individuals for drug distribution charges. The Haverhill sweep operation culminated in the arrest of 31 
individuals on a variety of narcotics related offenses and the execution of 5 separate search warrants at 
suspected drug distribution centers. Seized as a result of that investigation was well approximately 
1250 grams of highly pure cocaine, approximately 20 pounds of marijuana, and a large assortment of 
drug paraphernalia. In addition, NSI Division investigators seized approximately $60,000.00 in cash 
and 10 vehicles. Forfeiture actions are presently pending with respect to these seizures. Civil 
complaints seeking forfeiture of 3 real properties where a number of the drug transactions occurred 
were also filed in Superior Court. 

The second "Sweep" operation was conducted in Charlestown. There, undercover state police 
officers assigned to the NSI Division, working with the Boston police and Boston Housing Authority, 
made numerous narcotics purchases from individuals in Charlestown. The operation resulted in the 
arrest and indictment in Superior Court of 18 individuals, as well as the seizure of over 70 grams of 



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crack cocaine, a considerable amount of heroin, two firearms and an assortment of drug paraphernalia. 
Police also seized two motor vehicles under the drug forfeiture laws. 
OPERATION TAKE BACK 

The NSI Division also continued with its efforts in "Operation Take Back", an initiative 
designed to identify and target properties which are the site of repeated drug violations. Attorneys 
assigned to the Division's Asset Forfeiture Unit work with these property owners in an effort to 
eradicate the drug problems. Forfeiture actions are pursued against those properties whose owners are 
unwilling to take corrective measures as well as those properties which have been the site of repeated 
and continuous criminal violations. 

Of the numerous accomplishments this year in Operation Take Back, two merit special 
mention. The first involved the forfeiture of a Lowell drinking establishment, the site of repeated 
serious criminal activity. A civil forfeiture action filed against the bar and its owners by the Division's 
Asset Forfeiture Unit resulted in the forfeiture of the bar to the Commonwealth. This year, ownership 
of the property was transferred to the City of Lowell and the property will become the site of a new 
Lowell police substation. 

The second involved another drinking establishment located in the City of Chelsea. The bar 
was also the site of persistent criminal activity, including numerous sales of narcotics by the bar owner 
and manager to undercover state police officers assigned to the Division. The bar was previously 
forfeited to the Commonwealth through the efforts of the Asset Forfeiture Unit. This property is now 
slated to become the site of the new Chelsea District Courthouse. 
LANDLORD TRAINING PROGRAMS 

As a component of Operation Take Back, the Division's Asset Forfeiture Unit conducts 
landlord training seminars. These seminars are designed to educate landlords about their rights and 
responsibilities with respect to tenants who are utilizing the property as a drug distribution site. Two 
such trainings were conducted this fiscal year, both of which were well-attended. 



114 



The first training was conducted in Lowell this past April. The second took place the following 
month in Worcester. The Asset Forfeiture Unit published two manuals for use in conjunction with 
these trainings. 
WEAPONS INITIATIVE 

The NSI Division also continued its efforts to apprehend and prosecute violent criminals by 
targeting individuals involved in the illegal sale and possession of firearms, as well as other firearms 
related offenses. In addition, the Division continued to work closely with agents assigned to the 
Bureau of Alcohol, Tobacco and Firearms in their investigations of firearms offenses. 

In one weapons case investigated and prosecuted by the Division this past fiscal year, a 
Worcester resident was arrested after he sold a revolver, a sawed-off shotgun and a rifle to an 
undercover State Trooper assigned to the Division. This individual, the first in the Commonwealth to 
be indicted under the new gun trafficking statute, pled guilty and received a 6-10 year prison sentence. 
SIGNIFICANT PROSECUTIONS 

Among the general categories of crimes the NSI Division investigated and prosecuted during 
fiscal year 1995-1996 were the following: armed robbery, solicitation to commit murder, armed assault 
with intent to murder, manslaughter, arson, child pornography, narcotics trafficking, prostitution, 
breaking and entering, larceny, receiving stolen property, illegal gambling, fraud, corruption and 
firearms offenses. As outlined below, the NSI Division initiated 1 1 1 separate criminal cases during FY 
1995-1996. The Division also disposed of 80 separate criminal cases during the same time period. 
Some of these investigations and prosecutions are summarized below. 
Ben Crest Rooming House Arson 

In 1989, the Ben Crest Rooming House in Lynn caught fire, killing four people. A subsequent 
investigation by the Lynn Fire and Police Departments, as well as the State Fire Marshall's Office, 
ATF, State Police and the Essex County District Attorney's Office uncovered significant safety code 
violations. Specifically, the investigation revealed that the back door was chained closed, the sprinkler 



115 



system, fire alarms and smoke detectors had been disconnected and emergency ropes supplied in each 
bedroom were not long enough to reach the ground. One tenant using a rope to escape the fire fell two 
stories to his death. The case was referred to the NSI Division for review for potential prosecutions. 

Following a review and additional investigation by attorneys and investigators assigned to the 
Division, the matter was presented to an Essex County Grand Jury which returned four indictments for 
involuntary manslaughter against the landlord, Leo Allard of Nahant. In May of 1996, in what is 
believed to be the first successful prosecution of a landlord for manslaughter since the Coconut Grove 
fire, Leo Allard pled guilty in Essex Superior Court to all four indictments. He was sentenced to five 
years probation, 500 hours of community service and a $4,000 fine. 
Jewelry Store Armed Robbers 

From 1992 to 1995, Massachusetts and Rhode Island experienced a string of armed robberies of 
jewelry stores and jewelry salespeople. Each of the robberies was strikingly similar in the manner of 
execution and brazenness and it was determined that the same group was responsible for these 
robberies. Hundreds of thousands of dollars worth of jewelry was stolen during these robberies. At 
least 7 jewelry stores or jewelers were robbed by this same group. 

The NSI Division entered the investigation of these robberies this past fiscal year and began 
coordinating and developing the available information. As a result of information developed during 
the investigation, State Police assigned to the Division, along with law enforcement officers from New 
Hampshire, Rhode Island and a number of local police departments, arrested 6 people in connection 
with these robberies and recovered over $250,000.00 worth of the stolen property. Attorneys assigned 
to the Division began presenting evidence to grand juries in Middlesex, Norfolk, Barnstable and Essex 
Counties and all 6 were indicted for the robberies. By the close of the fiscal year, 5 of the 6 had either 
pled guilty or were convicted for their involvement in these robberies. 



116 



Prostitution Ring 

In May of 1996, following a lengthy investigation by NSI Division investigators, working with 
the IRS and Boston, Cambridge, Quincy and Revere police, 10 men and a woman were indicted by a 
Suffolk County Grand Jury on charges of deriving support from the earnings of prostitutes. Four of the 
men were also indicted for sharing in the earnings of a minor prostitute. One of the men was also 
indicted for trafficking in cocaine after he sold approximately 23 grams of cocaine to an undercover 
police officer. 

In total, five large-scale prostitution rings were targeted in this investigation. These rings, 
operating primarily out of residential homes in the greater Boston area, generated revenues estimated to 
be in excess of $1 million a year. Allegedly employing more than 40 prostitutes, they operated under 
the guise of "escort services." In addition to allegedly furnishing prostitutes, some of the suspects 
allegedly provided quantities of controlled substances, including cocaine, to their clients. The charges 
against these defendants were pending at the close of the fiscal year. 
Fraud Investigation 

Attorneys and investigators assigned to the NSI Division, working with the United States 
Attorney's Office, the Federal Bureau of Investigations, the Internal Revenue Service and the U.S. 
Postal Service, participated in an investigation which led to a 63 count criminal indictment against 
Mark S. Ferber, former Massachusetts Water Resources Authority (MWRA) financial adviser, on 
federal fraud and corruption charges. The defendant was convicted in August, 1996 following a 12 
week trial. 

The same investigation also led to the filing of civil actions in state and federal court and the 
eventual execution of a settlement agreement with two Wall Street financial firms, Merrill Lynch and 
Lazard Freres. Under the settlement terms, the firms agreed to pay a total of $24 million in fines, 
restitution, administrative payments and investigative costs. A significant portion of that amount was 
for restitution to the MWRA for financial advisory fees paid to the firms by that state agency. The 



117 



firms also agreed to effect significant changes in certain of their practices and procedures in the 
municipal securities industry- Recovery Of Stolen Property 

During this past fiscal year, the NSI Division investigated a number of cases which resulted in 
the recovery of large amounts of stolen property. In addition to the over $250,000.00 worth of jewelry 
recovered during the investigation of the jewelry store robberies, investigations conducted by the 
Division also led to the recovery of over $300,000.00 worth of stolen computer equipment. 
LAW ENFORCEMENT SUPPORT AND TRAINING 

Attorneys and investigators assigned to the division continued their efforts to work with and 
provide support to other federal, state and local law enforcement agencies. These agencies included the 
Federal Bureau of Investigation, Bureau of Alcohol, Tobacco and Firearms, United States Customs 
Service, Drug Enforcement Administration, Internal Revenue Service, United States Postal Service and 
various state and local police department throughout New England. 

Additionally, attorneys assigned to the NSI Division also sponsored a number of training 
programs. Among them was a training for Assistant District Attorneys handling forfeiture cases, 
conducted by the Division's Asset Forfeiture Unit. The Asset Forfeiture Unit also took part in a 
regional training for local and state law enforcement officers sponsored by the U.S. Drug Enforcement 
Administration. 



118 



SUMMARY OF NSI DIVISION ACTIVITIES FOR FY 1995-1996 



Criminal Cases Initiated 111 



B. Criminal Cases Disposed 



TOTAL 


PRE-TRIAL 


AFTER TRIAL 


80 


68 


12 


CONVICTIONS 


NOT GUILTY 


MISTRIALS 


DISMISSALS 


TOTAL 


71 


4 


1 


4 


80 



c. 



Seizures 




Cocaine 


5,396.41 grams 


Heroin 


131.37 grams 


Marijuana 


212 pounds 


U.S. Currency 


$187,259.00 


Vehicles 


12 


Stolen Property 
Recovered 


$550,000.00 


Drue Related Civil Forfeitures 



Cases Initiated 35 

Vehicles Forfeited 20 (forfeiture judgments in state court) 

Forfeiture Judgments $107,758.24 (forfeiture judgments in state court) 

$ 2,044.40 (federal forfeitures) 



Proceeds from Sale 
of Previously 
Forfeited Property 

TOTAL 



$ 90,574.53 
$200,377.17 



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PUBLIC INTEGRITY DIVISION 

In fiscal year 1996 the Public Integrity Division continued to investigate and prosecute public 
corruption and conflict of interest cases throughout the Commonwealth. The Division currently 
consists of six Assistant Attorneys General, several financial investigators and a team of Massachusetts 
State Police Officers. Given these resources, the Division has been able to successfully prosecute and 
convict those individuals and businesses that attempted to profit in violation of the ethical and criminal 
laws of the Commonwealth. 

In 1996, the Public Integrity Division commenced approximately twenty-five criminal 
prosecutions against public officials and other individuals who violated the public trust. During the 
same time period, over thirty criminal prosecutions were resolved. The criminal prosecutions that were 
initiated this year ranged from the crime of obstruction of justice by a municipal chief of police, to 
conflict of interest and campaign finance violations committed by campaign aids to the former Mayor 
of the City of Boston. 

In this past year, the Division commenced several investigations and prosecutions of 
individuals and political committees that violated the campaign finance laws of the Commonwealth. A 
special assistant to former Mayor Raymond L. Flynn was convicted of two separate instances of 
campaign finance violations. The assistant was found guilty of maintaining thousands of dollars in 
unreported cash contributions in his office at City Hall. These unreported cash funds were used to pay 
many unauthorized expenses in violation of the campaign finance laws of the Commonwealth. In 
addition, the assistant authorized and participated in the expenditure of approximately $5,000 in 
campaign funds for the Mayor's family vacation in Orlando, Florida. Furthermore, the special assistant 
was convicted of accepting over $50,000 in gratuities, received by him because of the official position 
he maintained with the City of Boston. These gratuities were provided by those individuals and 
businesses that had a contractual relationship with the City of Boston. 



120 



Former Mayor Raymond L. Flynn's campaign finance director was also convicted of 
embezzling several hundred thousand dollars from the Flynn Committee, and was sentenced to two 
years in the House of Correction. Furthermore, the Raymond L. Flynn Committee entered into a civil 
disposition agreement with the Office of the Attorney General and Office of Campaign and Political 
Finance in which the former Mayor acknowledged his personal use of campaign funds, and his failure 
to properly maintain adequate records. The former mayor agreed to repay his Committee $12,500 in 
funds used for his family's personal expenses. The Flynn Committee also agreed to forfeit $10,000 to 
the Commonwealth. 

The Public Integrity Division continued to successfully work with state and federal law 
enforcement officials. The above prosecution was obtained as a result of the joint efforts of the Public 
Integrity Division working in conjunction with the Public Corruption and Special Prosecutions Unit of 
the United States Attorney's Office and the Internal Revenue Service. 

The former Mayor of Fall River also entered into a disposition agreement in which he forfeited 
approximately $25,000 to the citizens of Fall River and the Commonwealth. In addition, the former 
Mayor acknowledged his committee's role in maintaining unreported cash contributions. Moreover, 
The former Mayor admitted to using some of the unreported cash to pay off debts of a former political 
opponent in exchange for that opponent's political support. 

The Division continued to prosecute incidents of corruption within the field of law 
enforcement. In October, 1995, the Division obtained the conviction of the Chief of Police of the 
Town of Oxford on obstruction of justice charges. The defendant in that case was found guilty of 
threatening and attempting to intimidate a witness that was cooperating with the Attorney General's 
Office. The defendant was eventually sentenced to ninety days in jail. 

The Division also prosecuted numerous state or municipal employees that stole 
Commonwealth funds. In one instance, the tax collector for the town of Westminster embezzled over 
$20,000 and received a six month jail term. 



121 



The Division continued to prosecute private businesses that defrauded the Commonwealth out 
of hundreds of thousands of dollars. One business owner, who ran a non- profit homeless shelter in 
Boston for single mothers and their children, was convicted of larceny and procurement fraud 
perpetrated upon the Department of Public Welfare. The Commonwealth convicted the shelter 
operator of diverting over $175,000 of DPW funds to cover personal expenses he and his staff 
incurred. These personal expenses included vacations in exotic places, dinners at expensive restaurants 
and over 40 massages at a local health spa. The business owner was eventually sentenced to two years 
in jail. 

Working with another state agency, the Division also brought criminal charges against a former 
Boston police officer turned criminal defense investigator. The investigator allegedly defrauded the 
Committee for Public Counsel Services of over $100,000. The investigator allegedly submitted phony 
billings for investigative services he never performed on behalf of indigent criminal defendants. In 
addition, the investigator also allegedly defrauded a local pension board in collecting his disability 
pension in violation of laws that prohibit such conduct. 

The Division successfully utilized other resources of the Attorney General's Office in 
expanding its capacity to prosecute corruption cases throughout the Commonwealth. Working in 
conjunction with the Western Massachusetts Office of the Attorney Generals Office in Springfield, the 
Division was able to prosecute two complex schemes to defraud Commonwealth funds. The first 
scheme involved four Holyoke rental property managers that allegedly stole $39,000 in heating 
assistance benefits intended for the poor and elderly. The property managers employed a scheme in 
which they applied for and received heating assistance benefits to which they were not entitled. 

Another scheme uncovered in Springfield involved a former state employee who participated in 
a scheme to generate thousands of dollars in unemployment checks to former recipients that no longer 
qualified for benefits. Once the checks were generated, the former employee intercepted and cashed 
them. Both of the Springfield cases are currently pending in Superior Court. 



122 



The Public Integrity Division also works closely with other divisions of the Criminal Bureau. 
This past year, the Public Integrity Division combined resources with the Tax Prosecution Unit of the 
Economic Crimes Division to successfully prosecute and convict a number of public officials and 
business entities for violations of the criminal tax laws of the Commonwealth. 

The Division continues to coordinate the Attorney General's Public Integrity Advisory Group, 
which brings together representatives from the various executive branches of state government to 
discuss joint effects to detect fraud, waste and abuse by government employees. Many of the 
prosecutions and convictions obtained by the Public Integrity Division originated from referrals by 
members of the Advisory Group. 

The Division's 1996 cases are summarized below. 

Public Charges and Indictments : 

9/95 

ALICIA PORCHER 

(W/MA) 

5 counts Forgery 

1 count Larceny 

5 counts False Submission to DET 



9/95 

KELVIN GRANT 

(W/MA) 

7 counts Forgery 
1 count Larceny 

8 counts False Submission to DET 

9/95 

CHARLES WILLIAMS 

(W/MA) 

1 count Larceny over $250 

9/95 

McKINLEY QUARLES 

(W/MA) 

1 count Larceny over $250 



123 



10/95 

MARIO SPENCER 

1 count of Forgery 

1 count of Uttering 

2 counts of Embezzlement by a Town Officer 
2 counts of Larceny 

2 counts of Filing False Reports 

10/95 

JANET SPEARS 

(W/MA) 

3 counts of Larceny 

2 counts of Conspiracy 

1 count of Receiving 

10/95 

MICHAEL SPEARS 

(W/MA) 

3 counts of Larceny 

2 counts of Conspiracy 

1 count of Receiving 

10/95 

ERICK SPEARS 

(W/MA) 

3 counts of Larceny 

2 counts of Conspiracy 

1 count of Receiving 

10/95 

PERCY LEE GRANT 

(W/MA) 

3 counts of Larceny 

2 counts of Conspiracy 
1 count of Receiving 

11/95 

PAUL DEDIAN 

1 count of Larceny over $250 

1 count of Embezzlement by Town Official 

1 count of False Written Reports 

12/95 

JAMES RIBERO 

1 count Larceny under $250 



124 



12/95 

GEORGE THIBODEAU 

1 count Larceny over $250 
8 counts False Representation 

4 counts Failure to File Tax Returns 

12/95 
BETTY WING 

1 count Larceny over $250 
3 counts False Written Reports 

12/95 

CATHERINE ROGERS 

1 charge Larceny over $250 

5 charges False Reports to DPW 

2/96 

DOUGLAS deRUSHA 

2 counts of Campaign Finance Violations 
1 count of Larceny over $250 

1 count of Larceny 



2/96 

JOSEPH FISHER 

5 counts Conflict of Interest 

2 counts Campaign Finance Violations 

4/96 

JOYCE CAMTRE 

Larceny over $250 

Forgery 

Uttering 

5/96 

JOSEPH J. BUTLER 

Procurement Fraud 

False Claims 

False Entry in Corporate Record 

Conspiracy 

5/96 

JACQUELYN MENNITTO 

Procurement Fraud 

False Claims 

False Entry in Corporate Record 

Conspiracy 



125 



5/96 

BRIAN ARTHUR 

Larceny over $250 

5/96 

CLAUDE daCOSTA 

Larceny over $250 

False Claims 

False Written Reports 

5/96 

NORMA ORTEGA-CANARY 

Larceny over $250 
Conspiracy 

5/96 

VICTOR MARTINEZ 

1 count Larceny over $250 
5 counts Forgery 

5/96 

LUIS TORD3IO 

1 count Larceny over $250 

1 cout Conspiracy 
5 counts Forgery 

6/96 

JAMES MILLS 

3 counts Larceny over $250 

2 counts False Claims 

2 counts Procurement Fraud 

2 counts Larceny by False Pretenses 

3 counts Perjury 

1 count False Tax Returns 

4 counts Failure to File Tax Returns 
3 counts Pension Fraud 



Dispositions : 



9/95 

JOHN F. JULIAN 

Defendant pled guilty 
Received 4 yrs. probation 
$13,679 restitution 

10/95 
JAMES JUNE 

Defendant pled guilty 
Received 2 V2-3 yrs. state prison 



126 



1 yr. to serve 

10/95 

JOSEPH P. BOGIGIAN 

Defendant pled guilty 

Received 3-5 yrs. State Prison sentence, suspended 

Received 3 yrs. probation 

$6,400 restitution 

10/95 

JAMES TRIPLETT 

Defendant found guilty of obstruction of justice 
Received 1 year House of Correction, 90 days to serve 
Defendant found not guilty on conflict of interest charges 
Jury unable to decide false report charges 

11/95 

GROUP BENEFITS STRATEGIES 

Defendant pled guilty 
Fined $20,000 

11/95 

PAUL TINSLEY 

Defendant pled guilty 
Fined $10,000 

12/95 

BRENDA BARNEY 

Defendant pled guilty 
Received suspended sentence 
$17,000 restitution 

12/95 

PETER COOK 

Campaign finance charges dismissed 
Commonwealth's appeal pending 

12/95 
SKE,INC 

Default judgement entered by Superior Court 

12/95 

DERECK WILLIAMS 

Defendant pled guilty 
Received 2-3 years state prison 



127 



3/96 

MARIO SPENCER 

Defendant pled guilty 
Received 1 yr. House of Correction 
6 months to serve 
$1 7,000 restitution 



3/96 

RAYMOND FLYNN COMMITTEE 

Civil disposition agreement 
Candidate acknowledged responsibility 
$10,000 forfeiture of committee funds 
$12,500 personal reimbursement to committee 

5/96 

BRIAN ARTHUR 

Defendant pled guilty 
Received suspended sentence 
$5,000 restitution 
100 hrs. community service 

5/96 

LUIS A. TORIBIO 

Defendant pled guilty 
Sentencing pending 

5/96 

VICTOR MARTINES 

Defendant pled guilty 
Sentencing pending 

5/96 

JOSEPH FISHER 

Defendant pled guilty 

Received 12 months House of Correction 

- 12 months suspended 

$10,000 fine 

6/96 

PAUL F. DEDEIAN 

Defendant pled guilty 

Received 2 yrs. House of Correction 

6 months to serve 

$22,000 restitution 



128 



6/96 

JOHN R. MITCHELL 

Civil disposition agreement 
Candidate acknowledged responsibility 
$17,500 fine 
$7,500 restitution 

6/96 

MARILYN M. RODERICK 

Civil disposition agreement 
Candidate acknowledged responsibility 
$5,000 fine 

6/96 

JOHN E. CLECKLEY 

Defendant found guilty 

Sentenced to two years House of Correction 

Restitution to be determined 

6/96 

MICHAEL PISCIONE 

Defendant found not guilty 

6/96 

MANUEL LOPES 

Defendant found not guilty 

6/96 

BRIAN ARTHUR 

Defendant pled guilty 
Suspended sentence 
$5,000 restitution 
100 hours community service 

6/96 

CLAUDE daCOSTA 

Defendant pled guilty 
Suspended sentence 
$16,000 restitution 
$10,000 fine 



129 



VICTIM/WITNESS PROGRAM 

The goals of the Victim/Witness Assistance Program of the Attorney General's Criminal 
Bureau are: (1) to provide crisis assessment and intervention to crime victims and witnesses to 
facilitate their emotional, psychological, physical and financial recovery from victimization; (2) to 
reduce the level of secondary victimization associated with victims' and witnesses' involvement in the 
criminal justice system and other systems; and (3) to aid in the prosecution of criminal cases by 
ensuring that crime victims and witnesses are provided with the rights and services mandated by the 
Victim Rights Law (M.G.L. c. 258B). 

During Fiscal Year 96 the program continued its momentum to focus on victim/witness needs. 
Victim advocacy and witness management services were provided by victim/witness advocate Kathy 
Morrissey on 36 cases covering 9 counties across the Commonwealth. The nature of victimization in 
cases included arson, rape, indecent assault and battery, domestic assault and battery, assault and 
battery on a child, patient abuse, insurance fraud, financial exploitation, armed robbery, armed assault 
in a dwelling, kidnaping, assault with a deadly weapon and solicitation to commit murder. Due to the 
high volume of witnesses, there were extraordinary demands for witness management, scheduling, and 
coordination for complex cases going to trial. The victim/witness advocate also provided consultation 
by screening 28 additional cases arising from duty calls, intakes and correspondence. The nature of 
complaints included homicide, incest, sexual assault, termination of parental rights, visitation and 
custody issues, parental neglect, violation of restraining orders, harassing telephone calls, sexual 
harassment and intimidation of witnesses. 

The Internship Program continued to expand in Fiscal Year 96. The victim/witness advocate is 
responsible for the supervision of the victim/witness advocate intern. The Criminal Bureau's second 
victim/witness advocate intern successfully completed a year-long, six credit internship in May, 1 996 
and graduated with associate degrees in human service and criminal justice. 



130 



The victim/witness advocate is also responsible for ongoing training and development relating 
to victim/witness issues. On August 7, 1995, a Criminal Bureau Victim Rights training was presented 
in anticipation of the Victim Rights Law which became effective on August 13, 1995. In October, 
1995, the victim/witness advocate wrote an article for the Law Enforcement Newsletter outlining the 
Victim Rights Law of 1995. In the Spring of 1996, the victim/witness advocate presented two office- 
wide brown bag lunch sessions on domestic violence and also assisted as a standby crisis counselor at 
the Commonwealth's Annual Victim Rights Conference. 



131 



URBAN VIOLENCE STRIKE FORCE 

The Urban Violence Strike Force was organized in the spring of 1991 as part of Attorney 
General Scott Harshbarger's overall commitment to improving the quality of life for residents of the 
Commonwealth's urban communities. Recognizing that there was an immediate need for additional 
resources to combat the increased level of violent crime that was blighting many of our urban 
neighborhoods, Attorney General Harshbarger assembled a team of experienced prosecutors and placed 
them at the disposal of the District Attorneys for both Suffolk and Essex counties. Over the course of 
the next two years, these specially assigned Assistant Attorneys General worked with the local police 
and district attorneys to successfully prosecute well over a hundred cases in both Suffolk and Essex 
Superior Courts. 

Based on the positive results achieved in both Suffolk and Essex counties, the Urban Violence 
Strike Force District Court Rotation Program was started. Assistant Attorneys General were assigned 
to the strike force on a rotating basis, and the strike force's efforts were expanded to include the 
prosecution of cases in a number of the Commonwealth's busiest district courts. 

In February of 1993, Attorney General Harshbarger continued his strong commitment to 
combating urban violence by establishing the Safe Neighborhood Initiative, an innovative prosecution 
and neighborhood revitalization effort targeting the Fields Corner, Bowdoin and Geneva Avenue 
sections of Dorchester. 

Safe Neighborhood Initiative 

The Safe Neighborhood Initiative (SNT) is the result of a four-year partnership between the 
offices of Attorney General Scott Harshbarger and Suffolk County District Attorney Ralph Martin. In 
February of 1991, Attorney General Harshbarger assigned three full-time Assistant Attorneys General 
to work with District Attorney Martin's office to prosecute major violent felonies and gang-related 
offenses. While this contribution to existing prosecution efforts was helpful, Attorney General 



132 



Harshbarger and District Attorney Martin agreed that the problems facing our communities demanded 
a comprehensive, multi-faceted approach to effectively deal with the crime and the fear of crime which 
threaten the quality of life in Boston's neighborhoods. On February 22, 1993, the Dorchester Safe 
Neighborhood Initiative (SNI) was formed as a partnership among community residents and 
organizations, the Office of the Attorney General, the Suffolk County District Attorney's Office, the 
Boston Police Department and the Mayor's Office of the City of Boston. 

Today, the Dorchester SNI has established its viability as a community-driven model for public 
safety and neighborhood revitalization. Younger projects throughout Massachusetts are demonstrating 
that the SNI can be replicated successfully in communities with very different needs and resources. By 
coordinating strategies among SNI law enforcement agencies, state and local government offices and 
community organizations, the SNI is an efficient tool to solving a variety of neighborhood problems. 

The Office of the Attorney General has been at the forefront of the Dorchester model SNI and 
unique replication projects in the Grove Hall area of Roxbury, Chelsea, Brockton and Lynn. To date, 
nearly a dozen Assistant Attorneys General have been designated to SNI Community Prosecution 
Teams in district and superior courts. The SNI Community Prosecutors continue to work with police, 
probation, neighborhood crime watches and community groups to ensure the attention of criminal 
justice is not only directed to media headlines such as gang or drug-related crimes, but also to the 
quality of life crimes which tear at the social fabric of many communities. Special Office of the 
Attorney General programs are leveraged to address community priorities, such as the Abandoned 
Properties Project which seeks to rectify building code violations. Furthermore, the Office of the 
Attorney General provides grants to a number of SNI community organizations which provide small 
business education for local merchants, prevention, intervention and treatment programs for youth and 
their families, and recreational and educational activities for all neighborhood residents. 

These investments generated several important events during fiscal year 1996. In September, 
the Attorney General hosted a conference to support state-wide interest in replicating the SNI which 



133 



was attended by approximately 400 people from cities throughout the Commonwealth. The winter 
months were occupied with technical assistance and planning efforts to assist the Plymouth County 
District Attorney's Office in designing the Brockton SNI, which took off with enthusiastic community 
support in February. In March, the Department of Justice awarded the Grove Hall SNI with official 
Weed and Seed site recognition. In April, Attorney General Harshbarger, District Attorney Martin, 
Boston Police Commissioner Paul Evans and Mayor Thomas Menino attended the monthly Dorchester 
SNI community advisory council meeting and then, in May, the principals assumed active roles in the 
Dorchester SNI Domestic Violence Symposium, an event which attracted 70 area teachers, health care 
workers, clergy and other local professionals. June witnessed the formal inauguration of the Chelsea 
SNI, building on the momentum of an extremely successful Zero Tolerance Weekend in the target area. 
Throughout the later months of fiscal year 1996, supervisory staff from the Office of the Attorney 
General met with Essex County District Attorney Kevin Burke and other key offices in Lynn to plan a 
Lynn SNI for fiscal year 1997 implementation. 

Toward the close of fiscal year 1996, the Safe Neighborhood Initiative made financial strides 
for fiscal year 1997. The Executive Office of Public Safety approved for the Dorchester SNI level 
funding at $341,314.00 as well as a new $30,000.00 grant to support a community-court liaison for the 
Grove Hall SNI. The Department of Justice officially recognized the Grove Hall SNI as a Weed and 
Seed site, positioning the initiative to apply for $125,000-$225,000 in federal support. Approximately 
$375,000 in state funds were approved for SNI personnel and expenses in the Office of the Attorney 
General budget. 

The Criminal Bureau members assigned to the Safe Neighborhood Initiative are Deputy Chief 
Susan Hicks Spurlock, Assistant Attorneys General Marcia Jackson, John Benzan, Neil Tassel, Shelley 
Richmond, Glenn MacKinlay, Brian E. Burke, Audrey Huang, Patricia Preziosa and SNI Project 
Administrator, Sara Trenary. 



134 



The following sections of the SNI report will provide prosecution statistics and significant 
community initiatives in Dorchester, Grove Hall, Chelsea and Brockton SNIs during fiscal year 1996. 
It is important to note that SNI projects differ in age and therefore sometimes reflect data for different 
spans of time. Furthermore, the SNI prosecutorial statistics in this report do not reflect disposition 
outcomes other than probation sentences and sentences to the House of Correction or State Prison. It is 
standard in busy urban courts, such as those in the SNI areas, for a high number of cases to be disposed 
as dismissal upon payment of court fees, guilty with a fine, continuance without a finding, etc. 



135 



The Dorchester SNI 

The principal offices of the Dorchester SNI have committed significant resources to the model 
SNI project, including staff and financial support from the offices of Attorney General Scott 
Harshbarger, Suffolk County District Attorney Ralph Martin, Boston Police Commissioner Paul Evans 
and Mayor of the City of Boston, Thomas Menino. Throughout fiscal year 1996, the Dorchester SNI 
Advisory Council met 1-2 times each month, engaging staff from the principal offices with 30-40 
community residents and organization representatives. The meetings provided a regular opportunity 
for the Dorchester SNI community to bring a number of priorities to the forefront of the SNI agenda, 
including domestic violence and prevention and intervention for youth. 

A significant challenge to the Dorchester SNI community this fiscal year was a spate of youth 
violence in the Bowdoin Street area. The problem inspired the Dorchester SNI law enforcement 
agencies and community groups to design and implement appropriate responses. The SNI Advisory 
Council prepared a violence prevention-oriented strategy; SNI prosecutors attended meetings with 
Boston Police, State Police and the U.S. Attorney's Office to discuss this recent increase in violence 
and to plan an undercover drug operation in the Bowdoin Street area. 

One result of coordination and collaboration among SNI law enforcement agencies is evident in 
a case prosecuted during fiscal year 1996. In this case, the defendant is a reputed member of a group 
that is an off-shoot of a gang called the Vamp Hill Kings. These two groups have been involved in 
recent violent activities in the Bowdoin Street area due to the return of gang members who have been 
incarcerated. The defendant was arrested for possession of a firearm, and after the review of the 
defendant's record and discussion with the Suffolk County District Attorney's Office it was agreed that 
if indicted under federal law as a felon in possession of a firearm the defendant could stand to face a 
greater period of incarceration than what he might receive following a state conviction. Discussions 
were held with representatives of the U.S. Attorney's office who agreed to accept this case for federal 



136 



prosecution. Since the defendant was being held on a high cash bail prosecutors obtained a state 
indictment to guarantee that the defendant would remain held on bail while the federal indictments 
were being sought. Currendy, the defendant is being held in the Suffolk County Jail, federal 
indictments have been returned and an arraignment in U.S. District Court is expected soon. 

The potential counter-threat posed to criminals by coordinated law enforcement has reached 
almost legendary status in the Dorchester SNI area. During fiscal year 1996, an interagency group of 
SNI-area streetworkers and state and local police and prosecutors spoke to a group of gang-associated 
youth about the case of Freddy Cardosa, a serious criminal in the area who, through the use of federal 
statutes, received 20 years in federal prison for possessing a single bullet. Several months have passed 
since these youth heard the story of Cardosa's case, and these youth remain conspicuously absent from 
criminal activity. 

The introduction to this report spotlights several of the community accomplishments of the 
Dorchester SNI such as the Domestic Violence Symposium and the $341,314 grant received from the 
Executive Office of Public Safety. In another instance of success, MBTA Police worked with SNI 
prosecutors and the Advisory Council to see that two of the three pay phones that had recendy been 
installed at the Fields Corner Station and that, according to residents, had attracted drug-related 
activity, were moved to inside the fenced area of the station so the phones were only accessible to 
MBTA riders. The third phone was left outside the fenced area and has been replaced with a NYNEX 
"Smart Phone" which is limited to 91 1 access during off-peak travel hours. This type of efficient and 
creative problem-solving is emblematic of the SNI partnership. 



137 



Dorchester SNI Prosecution Statistics 
July 1, 1995 -June 30, 1996 



Superior Court 




Cases Disposed 


43 


Defendants Sentenced 




to HC/Prison 


31 


Probation 


3* 


Referred to US Attorney 


1 



Dorchester District Court 

Total New Cases Screened 1 126 

Cases Disposed 597 
Defendants Sentenced 

to House of Correction 60 

Probation 77* 



*Note: Probation statistics were required after January, 1996. Therefore, Dorchester SNI probation 
statistics only reflect two out of four quarters of data. 

The Grove Hall SNI 

Fiscal year 1996 was a year of important recovery and growth for the Grove Hall SNI. After 
the tragic murder of Assistant Attorney General Paul McLaughlin in September, the Grove Hall SNI 
had to recover from the loss of the SNI Lead Prosecutor and a dear friend to many. AAG McLaughlin's 
spirit perseveres in the tenacity of the Grove Hall SNI. The Grove Hall SNI principal offices- 
Attorney General Scott Harshbarger, District Attorney Ralph Martin, Boston Police Commissioner 
Paul Evans, Mayor of the City of Boston, Thomas Menino and U.S. Attorney Donald Stem-- and 
Grove Hall community members met 1-3 times a month since the project's inception in March of 1995. 
Throughout fiscal year 1996, the group identified as priorities quality of life issues such as prostitution, 
motor vehicle violations, domestic violence, alcohol abuse by minors and crimes against the elderly. 

The Grove Hall SNI's heavy focus on quality of life issues was complimented by targeted and 
coordinated prosecution efforts. In one significant case, the defendant was arrested and charged with 



138 



unlawful possession of a firearm, possession of crack cocaine, intent to distribute in a school zone, 
failing to stop for a police officer, and assault and battery on a public servant. The defendant already 
had a 2 1/2 year stay of execution pending; the stay was revoked and the defendant was sentenced to 2 
1/2 years committed to the House of Correction. As an SNI partner, the U.S. Attorney's Office 
consulted on the defendant's record and indicted him on the firearm charge as a career criminal, for 
which the defendant faces a mandatory sentence of 15 years to life in federal prison. The GHSNI 
Prosecution Team also intends to proceed with the drug charges in district court and to seek the 
maximum penalty. Similar to the example illustrated in the Dorchester SNI, this SNI case 
demonstrates how coordinated prosecution efforts can yield powerful sentences. 

This year, the Grove Hall SNI District and Superior Court Prosecution teams also worked 
closely with the Area B-2 Boston Police Department to investigate possible sights for drug sweeps and 
a variety of other police operations, such as Operation Squeeze. Operation Squeeze, an ongoing effort 
by the Boston Police Department to prosecute "Johns" soliciting prostitutes, was undertaken twice in 
May. In the early May sweep, there were 16 arrests. Of these arrests, 13 defendants were sentenced to 
significant probation time, 100 hours of community service, and were required to take part in an AIDS 
education awareness program. The remaining three defendants from that sweep appeared in court in 
late July. The sweep in late May netted 12 defendants. 

The Grove Hall SNI Prosecution team was also active this year in groups such as the Roxbury 
Domestic Violence Round table discussion group and the Community-Based Juvenile Justice Program 
at the Jeremiah Burke High School. The extensive efforts of the Grove Hall SNI Prosecution Team 
will soon receive critical support: in fiscal year 1996, the Program Division of the Executive Office of 
Public Safety approved an application for $30,000.00 to hire a Court/Community Liaison. The liaison 
will work within the Grove Hall neighborhoods of Roxbury to coordinate the community initiatives 
component of the SNI and to act as a liaison with the Roxbury District Court. 



139 



Grove Hall SNI Prosecution Statistics 
January 2, 1995- June 30, 1996 



Roxbury District Court 




Superior Court 




Total New Cases Screened 


327 


Cases Disposed 


3 


Cases Prosecuted 


291 


Defendants Sentenced 








to HC/Prison 


3 


Cases Disposed 


154 


Probation 


t) 


Defendants Sentenced 




Superior Court Case 




to House of Correction 


63 


Referred to US Attorney 


1 



140 



The Chelsea SNI 

The Chelsea SNI was originally founded in September of 1995 by the principal offices of 
Attorney General Scott Harshbarger, Suffolk County District Attorney Ralph Martin, Chelsea Police 
Chief Edward Flynn. Chelsea City Manager Guy Santagate joined the SNI soon after, and by May of 
1996 community prosecution had commenced and community organizations had joined the Chelsea 
SNI Advisory Council, which meets monthly. The Chelsea SNI aims primarily to reduce crime, 
especially drug dealing and prostitution, in the targeted area through coordinated police and 
prosecution efforts and neighborhood involvement in these efforts. 

The Chelsea SNI worked assiduously during fiscal year 1996 to bring law enforcement to 
bear on the quality of life issues which are often left unaddressed. For example, at the SNI Advisory 
Council meeting in April, the community rallied to express concern over the increasing damage caused 
by a troublesome person in the area. The testimony of the community persuaded police and other SNI 
law enforcement officials to keep the individual under close watch. Within a month, the individual 
was arrested on a default warrant and pled guilty to several charges which effectively removed him 
from the area. This case presents a simple but critical force which drives the SNI: community-defined 
priorities. 

Other significant accomplishments of the Chelsea SNI this fiscal year demonstrate the 
importance of quality of life issues, community input and their relationship to public safety. In one 
instance, the SNI Advisory Council applied pressure to the Store 24 to close during the hours of 12:00 
a.m.-5:00 a.m. The store has posed chronic problems to police as it has been a magnet for criminal 
activity, particularly disorderly conduct by youth in the early morning hours. The Advisory Council 
decided to submit a letter to the Licensing Board from an SNI Prosecutor to request the closure, which 
has since been effected. Similar to the Store 24 case, the Riley's Roast Beef was home to criminal 



141 



activity, especially drug sales. The SNI Advisory Council has successfully advocated for the restriction 
of drive-through hours and the removal of outside tables and benches in order to diffuse drug sales. 

Several community members were present at the June inauguration celebration for the 
Chelsea SNI, which rode on the momentum of the highly publicized May 10-12 Zero Tolerance 
weekend. The Zero Tolerance targeted Johns, public drinking and traffic offenses and netted a total of 
64 arrests. 



Chelsea SNI Prosecution Statistics 
May 10, 1995 - June 30, 1996 



Chelsea District Court 

Total New Cases Screened 226 

Cases Prosecuted 226 

Cases Disposed 85 
Defendants Sentenced 

to House of Correction 8 

Probation 6 



Superior Court 




Cases Prosecuted 


3 


Cases Disposed 





Defendants Sentenced 




to HC/Prison 





Probation 






142 



The Brockton SNI 

The principal offices of the Brockton SNI-- Attorney General Scott Harshbarger, Plymouth 
County District Attorney Michael Sullivan, Brockton Police Chief Paul Studenski and Brockton Mayor 
John Yunits— designed and implemented an inspiring replication of the Dorchester model. On 
February 20, 1996 the Brockton SNI held the first community meeting and continues to meet monthly. 
Throughout the early months of 1996, the Brockton SNI defined their priorities to include the 
abandoned buildings and landlord accountability, drug dealing, youth/gang violence, and the need for 
programs for teens. 

The coordinated law enforcement efforts of the Brockton SNI gleaned highly publicized 
successes this fiscal year, such as a drug raid which lead to the dismantling of a sophisticated crack 
cocaine ring in the neighborhood, including the arrest of three suspected drug kingpins and the seizure 
of over 300 grams of cocaine. Drug sweeps and zero tolerance exercises are a strong statement by law 
enforcement agencies to criminals that violative behavior will be addressed, if appropriate, with arrest 
and enhanced prosecution. The role of the Brockton SNI in such statements in critical to a city which 
boasts that 2/3 of its populace are members of crime watches. 

The Brockton SNI was extremely successful in mobilizing community support and city 
agency participation in neighborhood revitalization efforts such as the Adopt-a-Lot program, which 
generates sponsors to support the beautification of vacant lots and the Abandoned Properties project, a 
collaborative project between the Office of the Attorney General, the District Attorney's Office, city 
offices and the community to ensure that building code violations are addressed. 

The Brockton SNI will also receive coordination support due to an SNI Prosecutor who 
submitted a successful grant proposal to Christy's Convenience Store (headquartered in Brockton). 
During this fiscal year, Christy's awarded the Brockton SNI $1,000.00 a month for 12 months as partial 



143 



payment for the salary of a Court/Community Coordinator. The Office of the Attorney General will 
supplement the grant from Christy's to make the position a reality for fiscal year 1997. 



Brockton SNI Prosecution Statistics 
February 1, 1995- June 30, 1996 



Brockton District Court 

Total New Cases Screened 151 

Cases Prosecuted 151 

Cases Disposed 55 
Defendants Sentenced 

to House of Correction 1 7 

Probation 5 

Superior Court 

Cases Disposed 1 
Defendants Sentenced to 

HC/Prison 1 

Probation 1 



144 



District Court Rotation Program 

The District Court Rotation Program began in October, 1991 as an expansion of the Urban 
Violence Strike Force. The program involves the six month deployment of specially trained Assistant 
Attorneys General working on loan to the District Attorney's office in Roxbury, Lawrence and 
Brockton, three of the busiest district courts in the Commonwealth. The program has provided a 
significant contribution to existing prosecution efforts and has been extremely helpful to the Suffolk, 
Plymouth and Essex District Attorneys Offices. Since its inception, fifty-four assistant attorneys 
general have participated in the program. 

In fiscal year 1996, the Assistant Attorneys General assigned to the rotation program 
prosecuted a wide range of cases generally found within a district court caseload: larceny, operating 
under the influence of liquor, both simple and more complicated drug cases, property crimes (malicious 
destruction of property, breaking and entering, larceny, motor vehicle), gun cases and a great number of 
assault-related crimes, many of which involved a weapon. 

Assistant Attorney General participants in the District Court Rotation Program for fiscal year 
1996 were Glen Kaplan, Djuna Perkins, Joshua Krell, Audrey Huang, Katherine Hatch and Selena 
Samm. 



145 



FAMILY AND COMMUNITY CRIMES BUREAU 

The Family and Community Crimes Bureau is primarily responsible for policy and program 
development, training and legislation in several subject areas: family violence, (including child abuse, 
elder abuse, and partner violence) children and youth, and victims of crime. In addition, claims for 
compensation filed by victims of violent crime are reviewed and approved through the Bureau's Victim 
Compensation and Assistance Division. 

THE ELDERLY 

The protection of elders continued to be a priority for the Office of the Attorney General. 
Consequently, a focus on elder abuse and neglect, consumer fraud and financial exploitation remained 
a priority for the Family and Community Crimes Bureau, through the work of the Elderly Protection 
Project, working with the Public Protection Bureau and other Divisions within the office. 
In FY '96, the Project continued to provide high quality and comprehensive training to police officers 
and recruits across the Commonwealth. Development and presentation of day-long seminars and 
workshops, and dissemination of training manuals, provided training on a variety of elder issues to 
police at all levels: introductory training for new police recruits, advanced training for veteran officers, 
and training on community outreach and using elders as volunteers for police managers. Overall, the 
training reached approximately 288 police recruits, and over 500 police officers at varying levels. In 
addition, the Project developed a separate training program for law enforcement officers on effectively 
dealing with persons with Alzheimer's Disease. This program, coordinated in conjunction with the 
Alzheimer's Association of Eastern Massachsuetts, included a roll-call training videotape, police 
guidebook and laminated "Cruiser Call Sheet" for handy access by patrolling officers. The Project staff 
also participated in "first responder" trainings on available local resources for the care of Alzheimer's 
patients, entitled Allies for a Safe Return. 



146 



The Project also provided direct education to elders on consumer issues, home safety and 
security, and fraud, in the form of day-long seminars entitled, Consumer University. These seminars 
were held at three different sites across the Commonwealth, and reached over 820 elders, who each 
received a 73 page "student manual" for future reference. 

The Bureau's participation in the Massachusetts Bank Reporting Project involved 
development of training manuals and presentationg of three-hour training programs for bank managers 
and employees on their proper roles in detecting, assessing and preventing elder financial exploitation. 
These programs were presented to over 450 bank managers and security officials, in conjunction with 
the Executive Office of Elder Affairs and the Massachusetts Bankers Association. The banking 
industry has since ordered 160,000 copies of a pamphlet prepared by Bureau staff on elder financial 
exploitation, entitled It's Your Future: Protect Your Savings. 

FAMILY VIOLENCE 

Effective intervention and prevention of the ongoing problem of family violence and abuse 
continues to be a major focus of the work of the Family and Community Crimes Bureau. The Attorney 
General has taken advantage of the opportunity to expand this focus nationwide through his role as a 
member of the Department of Justice's National Advisory Council on Violence Against Women and 
convenor of its Law Enforcement Working Group. 

Updated and comprehensive training for law enforcement officials remains a vital part of any 
strategy to combat, and ultimately prevent, family violence. The Family and Community Crimes 
Bureau remained at the forefront of such efforts through presentation of the Attorney General's Fifth 
Annual Domestic Violence Police Training in FY '96. This training provided over 300 police officers 
with updates on legal developments and information on intervention and prevention strategies focusing 
on children who witness family violence, domestic violence against elders and teen dating violence. 
This training was replicated, in conjunction with the offices of the Berkshire, Hampden and 



147 



Northwestern District Attorneys, for police in western Massachusetts. Additional law enforcement 
training efforts included publication of a domestic violence update section of the Attorney General's 
Law Enforcement Newsletter, as well as participation in the Massachusetts State Police Domestic 
Violence Training Program. 

Training for prosecutors on domestic violence and sexual assault will be effectively 
addressed through the creation of a Prosecutor's Manual on Domestic Violence and Sexual Assault, 
which the Family and Community Crimes Bureau has obtained a federal grant to produce, in 
collaboration with the Massachusetts District Attorneys' Association, and the eleven district attorneys 
offices across the Commonwealth. 

Recognizing that the problem of family violence is in large respect a public health problem, 
requiring a community-wide response, the Bureau's efforts have extended to other segments of the 
community. In FY '96, these efforts included the production of a video for health care professional 
entitled Diagnosis: Domestic Violence and collaboration with a Greater Boston interfaith clergy group 
in an effort to produce a training manual for clergy on effectively addressing domestic violence issues 
in their congregations. The effect of domestic violence on the workplace has also been a focus of the 
Bureau's worked. Staff participated in several training sessions for private employees, presented three 
in-house training sessions on domestic violence for office staff, and urged use of the Attorney General's 
office policy as a model for the commonwealth and private employers to adopt as part of a 
comprehensive effort to address the problem of family violence within the workplace. 

The Bureau has continued to draft and file legislation to further improve the criminal justice 
system's response to family violence. In FY '96, legislation filed by the Attorney General, and now 
law, will effectively implement federal legislation by creating a mechanism for local police and 
prosecutors to enforce protection orders issued outside of Massachusetts. The legislation also will 
expand police arrest powers where firearms are present in domestic violence situations, facilitate the 



148 



ability of persons court access to persons with disabilities to obtain protective orders and expand the 
scope of admissible evidence in cases of domestic abuse committed against a spouse. 

CHILDREN/YOUTH 

In the area of juvenile justice, the Family and Community Crimes Bureau drafted and filed 
legislation directed at improving the administration of justice for serious youthful offenders. This 
legislation sought to reverse the then-current practice by mandating that a juvenile's trial be conducted 
first, before any other proceedings to determine whether disposition as a juvenile or as an adult was 
appropriate. The (trial de novo) bill also sought to eliminate the practice of allowing juveniles two 
separate trials. A modified version of this legislation was passed by the legislature. Bureau staff also 
participated in planning and presenting a 5-day certification training for juvenile police officers, in 
conjunction with the Massachusetts Juvenile Police Officers' Association, covering all aspects of law 
enforcement procedures for dealing with juvenile offenders. The Bureau also continued to work with 
the Child Welfare League of Massachusetts, in a continued effort to achieve full implementation of a 
statewide Juvenile Court. 

The Bureau also continued its efforts to work with school administrators and police toward 
creating a safe school environment for students. The Attorney General filed a Safe Schools Legislative 
Package, drafted by the Bureau, which included provisions for gun-free school zones and increased 
cooperation and communication between schools and law enforcement. The Bureau also instituted a 
Safe Schools Newsletter for school administrators, and law enforcement officer and held its annual 
Safe Schools Conference this year entitled, Civil Rights in Our Schools: Building a Safe Community. 
Bureau staff continued to work with campus law enforcement authorities to address student safety 
issues, including the reporting of sexual assaults on campus. 



149 



VICTIMS 

Bureau staff also drafted and filed a comprehensive bill to protect the privacy of crime 
victims' confidential counseling communications; filed amicus brief in support of the constitutionality 
of the principle of a sexual offender registration and community notification bill, and assisted with an 
amicus brief supporting broader protections for rape victims; counseling records. 

The Attorney General remains the chairperson of the Victim and Witness Assistance Board, 
which oversees the work of the Massachusetts Office for Victim Assistance (MOV A). MOV A staff 
continued to administer the award of federal Victim of Crime Act (VOCA) grants to community-based 
agencies MOVA staff also planned and presented the 1996 Victims' Rights Conference, which was 
attended by over 400 victim advocates, victimss, and law enforcement and social services 
professionals. This year's conference focused on issues including child abuse, domestic violence, hate 
crimes, juvenile justice, teen dating violence, and media crime coverage. 

With assistance from the FCCB, MOVA also published the first comprehensive guide for 
victims in the Commonwealth, entitled In the Aftermath of Crime: A guide to Victim Rights and 
Services in Massachusetts, and an updated guide on court-based advocacy available for domestic 
violence victims. 

MOVA also oversees the ongoing implementation of SAFEPLAN, a program designed to 
ensure placement of a victim witness civil adovcate in every court in the Commonwealth, to assist 
victims with their efforts to seek protection from domestic violence. Currently SAFEPLAN is 
operating in one county on a pilot basis, with plans, and the recent award of grant funding for 
expansion of the program statewide. 



150 



VICTIM COMPENSATION AND ASSISTANCE 

The Victim Compensation and Assistance Division provides financial compensation to crime 
victims for out-of-pocket medical expenses, lost wages and other crime-related expenses. Under a 
1994 reform law, the Division assumed legal and administrative responsibility for receiving, 
investigating and determining all claims for victim compensation in accordance with the requirements 
of G.L.c 258C. Previously, compensation claims were determined through a litigation-based process in 
the district courts. 

This marked the second full year of the Division's operation as an administrative agency. 
Throughout the year, the Division sought to achieve two primary goals. First, it sought to conclude a 
backlog of court-based victim compensation claims that remained pending in the district courts under 
the prior court-based system. Second, it sought to secure stability in the operation of the administrative 
system while broadening the scope of the Division's mission in responding to the needs of crime 
victims. 

By year end, the Division had concluded virtually all court-based claims. With the assistance 
of interns, volunteers and others, a backlog of over 2,000 court-based claims was reduced to 39 
pending claims. This accomplishment brings closure to a system long characterized by inefficiencies, 
delays and frustrations. It marks a true beginning for the Division as a national leader in providing 
compensation assistance to crime victims. 

Within the administrative system, the Division placed primary focus on automation, cost 
containment, outreach, and quality improvement. As discussed below, the Division realized significant 
achievements in each of these areas. 

1. Automation/claims analysis: Throughout the year, the Division worked closely with the 
office's Management Information Systems personnel to develop an automated system for receiving, 
tracking and analyzing compensation claims and payments. Although this process remains incomplete, 



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significant benefits have already been realized. These include the ability to provide immediate and 
accurate status and payment information to victims and providers; the ability to maintain better internal 
management of investigations and case flow; the ability to analyze claims by victim, crime-type, and 
other factors; and the ability to maintain and analyze payment data on awards for compensation. 

Analysis of this data shows that in 1996, the Division received 1,040 claims for 
compensation. This represents a 9% increase over the previous year. It issued decisions in response to 
91 1 claims. In 607 of these decisions (67%), the Division awarded compensation to the claimant. In 
232 cases (25%), the Division determined that the claimant was statutorily eligible for compensation 
but did not, at present, have expenses that are compensable under the statute. The remaining 72 claims 
(8%) were denied because the claimant was not eligible for compensation under the Commonwealth's 
victim compensation statute. 

Under G.L. c. 258C, claimants are entitled to seek internal administrative review of the 
Division's decisions. In 1996, claimants requested administrative reconsideration of 44 (5%) of the 
Division's decisions. In 14 cases, the Program Director modified or reversed the original decision. The 
remaining 30 decisions were affirmed on reconsideration. Although claimants are entitled, in addition, 
to seek judicial review of the Division's decisions, only one such petition was filed in 1996. This 
petition was dismissed by the court. 

Through the Division's automated claims tracking system, claims resulting in payment were 
further analyzed by crime-type, victim age and state residency. Crime-type data shows that in 1996, 
51 % of all victims receiving compensation were victims of assault. Homicide claims represented 26% 
of awards, followed by child sexual assault (8%), domestic violence (6%), adult sexual assault (6%), 
DWI/DUI (2%) and other (1%). 

Analysis of victim age data shows that 20% of all awards involved victims under the age of 
17. Victims between the ages of 18 and 65 represented 77% of all awards, while victims over the age 



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of 65 represented 3% of awards. 95% of all compensation awards were made to Massachusetts state 
residents. The remaining 5% of awards involved nonresidents who were victimized in the 
Commonwealth. 

Administrative awards were also analyzed for payment information. This data shows that 
while the Division is statutorily authorized to award up to $25,000 per claim, the average compensation 
award in 1996 was $3,062. The largest category of payments (40%) was for economic support in the 
form of lost wages and loss of financial support to the family members of homicide victims. Medical 
and dental expenses represented 28% of all expenses, while funeral and burial expenses represented 
24% of expenses. These were followed by mental health counseling expenses (7%) and "other" 
expenses (homemaker expenses and attorneys fees), representing 1% of expenses. 

At the close of the year, the Division maintained a pending administrative caseload of 620 
claims. Most decisions were issued within three to six months of receipt. By contrast, the average 
processing time under the court-based system was two to three years. 

2. Expenditures/cost containment: In 1996, the Division awarded $4.26 million in 
compensation to crime victims. This represents an 1 1 % increase over the previous year, and a 27% 
increase over the preceding year. It also represents the largest payout to crime victims in the Division's 
history. As a result, however, funding was insufficient to support payments through the end of the 
year. For the second consecutive year, supplemental funding was required to pay all outstanding 
judgments and awards. 

Analysis of claims and payment data show that the Division's funding shortfalls were 
attributable to the Division's successful efforts to conclude the backlog of court-based claims. As 
demonstrated by the Division's federal performance reports, the number of claimants receiving 
payment from the victim compensation fund increased thirty percent (30%) in federal FY95 after 



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increasing forty percent (40%) in FY94. With the conclusion of the court-based claims, the Division 
anticipates that its funding needs will stabilize. 

Recognizing the need for cost containment and anticipating rising claim numbers in future 
years, this year the Division undertook a series of cost-containment measures designed to achieve 
significant savings without placing additional financial burdens on crime victims. Staff investigators 
assisted eligible crime victims in applying for hospital -based "free care" (G.L.c. 1 18F) to cover crime- 
related hospital expenses. They also undertook to negotiate victims' medical, dental and counseling 
bills with providers. As a result of these negotiations, many providers agreed to accept significantly 
reduced payments, and to release crime victims from any financial responsibility for the balance. 

Through these measures, in 1996 the Division achieved $628,264 in savings on outstanding 
medical bills. This represents fifteen percent (15%) of all expenditures. Based on the average award of 
$3,062, these savings enabled the Division to award compensation to over 200 additional crime 
victims. As shown by the Division's federal performance reports, over the past two years, these and 
other measures have enabled the Division to reduce the average award by thirty percent (30%) while 
maintaining full coverage of victims' compensable losses. 

3. Outreach: The Division continued its efforts to ensure broad public information about the 
victim compensation program. Applications and brochures were widely distributed to criminal justice 
agencies and victim service providers. Hospitals throughout the state were notified of eligibility 
requirements and payment procedures under the administrative system. The Division also conducted 
training sessions for law enforcement agencies, victim service providers and others. 

4. Quality improvement: This year, the Division undertook to further expand the scope and 
quality of its services to crime victims. It adopted a Mission Statement recognizing both its primary 
obligation to "determine claims for compensation in an efficient, consistent and professional manner" 
and its broader role to "work in conjunction with other victim service agencies and providers to ensure 



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that all crime victims are treated with dignity, respect and compassion." In keeping with this mission, 
the Division developed a comprehensive Investigative Manual to ensure the consistent and efficient 
handling of all claims. In addition, all staff received extensive training in victim rights, the criminal 
justice system, relevant areas of substantive law and victim advocacy. Following this training, the 
Division actively undertook to ensure that all victims receive information about their rights, and that 
they receive appropriate referrals to other victim service agencies. It interceded with funeral homes and 
other providers to ensure prompt delivery of services to victims and their families. It also adopted a 
practice of ensuring that certain victims are actively informed of the availability of compensation to 
assist with grief counseling and other crime-related mental health counseling services. 

Finally, in conjunction with its efforts to expand its role as a victim service provider, the 
Division applied for, and was awarded, a grant from the U. S. Department of Justice, Office for 
Victims of Crime, to plan and host a New England regional conference addressing issues of 
coordination among victim service providers. The "1996 VOCA Victim Compensation and Assistance 
Coordination Conference" was held in Boston on June 20-21, 1996. The conference included 
administrators and directors of victim compensation programs, VOCA victim assistance programs, 
public sector victim/witness assistance programs, community-based sexual assault and domestic 
violence programs, and U.S. Attorney victim/witness programs from each of the New England states. It 
marked the first time that victim service leaders from Massachusetts, Connecticut, Vermont, New 
Hampshire, Rhode Island and Maine had come together to discuss the coordination of victim services. 
The conference covered a broad range of structural, funding and coordination issues, and featured 
several nationally recognized victim service leaders from throughout the country. 



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PUBLIC PROTECTION BUREAU 

The Public Protection Bureau is comprised of five divisions: Consumer Protection and 
Antitrust Division, Regulated Industries Division, Civil Rights and Civil Liberties Division, Public 
Charities Division and Civil Investigation Division. The Bureau also has an office of Chief Prosecutor, 
which brings criminal actions in appropriate cases. 

The Bureau contains the Consumer Complaint and Information Section and oversees the 
Local Consumer Aid Fund, which provides grants to local community groups to mediate and resolve 
consumer complaints at the local level. 

The various divisions in the Public Protection Bureau bring affirmative litigation and 
criminal prosecutions on behalf of the Commonwealth and its citizens in the areas listed above. The 
divisions also conduct investigations and publish and issue reports in areas of interest arising out of 
their activities. 

Bureau personnel also coordinate and staff the Attorney General's innovative and successful 
program to reduce youth violence-SCORE-Student Conflict Resolution Experts. This is a school- 
based mediation program using trained student mediators to resolve disputes among their peers and 
prevent the disputes from escalating into violence. This unique program has received national 
recognition for its success in preventing violence and the Attorney General is committed to expanding 
it into every school in Massachusetts. 

The Attorney General has charged the Bureau with coordinating office efforts and taking the 
lead in two priority areas-elder issues, and health care. Responding to that charge, the Bureau has 
developed initiatives and legislation in those areas and will continue to fulfill its role in the coming 
year. In the elder area, the Bureau sponsored the conference, "Elder Health Care: Crisis at the 
Crossroads," in October 1995 and published the Conference Handbook. Bureau staff have contributed 
to AGenda Elderly, the Attorney General's elder newsletter. The Bureau also helped prepare the 



156 



recently-published seminal report on guardianship, entitled Guardianship In Massachusetts: Where We 
Are and Where We Should Be Headed, which draws on national research from other states and input 
from professionals in the field in formulating recommendations for reform. 

Other Bureau publications include Choosing A Home Care Agency .-Important Questions to 
Ask; Attorney General's Guide To Long-Term Care; and, Home Health Aides In Massachusetts: A 
Report And Recommendations. The Bureau is also participating in the formation of the Home Health 
Care Industry Working Group, which will facilitate discussion among interest groups in the home 
health care industry. 

Some of the Bureau's accomplishments in the health care area include developing 
community benefit guidelines for hospitals and HMO's, influencing legislative initiatives in the health 
insurance and access arenas, and backing legislation that will help safeguard the welfare of patients 
served by home health agencies and home care corporations. The Bureau is also actively pursuing 
criminal and civil cases involving health care fraud against both consumers and insurance companies. 

Last, the Bureau continues to be actively involved with consumer issues and this year 
participated in the Attorney General's Consumer University, which presented an interactive series of 
consumer seminars for Massachusetts elders. The Bureau also published, in cooperation with the 
Massachusetts Association of Realtors, the widely distributed Title 5--Facts For Consumers, a booklet 
alerting consumers to the potential for problems in complying with the new septic system regulations. 



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CIVIL RIGHTS DIVISION 

Massachusetts Civil Rights Act Cases 

The Civil Rights Division continues to demonstrate its commitment to protecting the rights 
of the citizens of and visitors to the Commonwealth by actively enforcing the Massachusetts Civil 
Rights Act (MCRA). The MCRA authorizes the Attorney General to seek injunctive relief when the 
exercise of a person's civil rights is interfered with by threats, intimidation, or coercion based on that 
individual's race, color, national origin, ethnic background, gender, sexual orientation, disability, age, 
or religious affiliation. 

In fiscal year 1996, the Division's efforts to combat such violent forms of discrimination 
resulted in the issuance of preliminary injunctions by the Superior Court in three cases against seven 
defendants, where it was alleged that the defendants had interfered with the rights of Massachusetts 
residents on the basis of their race, interracial association, religion and national origin. Three final 
judgments by consent were entered by the Superior Court against eight defendants where it was alleged 
that the victimization was based on the race, interracial association or religion of the victim. One other 
final judgment was entered against one defendant based on allegations of privacy violations. In total 
more than thirty in-depth civil rights investigations of possible MCRA violations were conducted by 
the Division. 

A dramatic example of the Division's effective implementation of the MCRA occurred when 
it obtained a permanent injunction against an individual operator of a public accommodation who had 
set up a video camera and other monitoring equipment in the bathroom of his laundromat in Yarmouth. 
The civil rights injunction banned the use of such equipment in the bathroom and prohibited further 
interference with the right to privacy of customers of his facility. The defendant also agreed to 
contribute five thousand dollars to the Attorney General's Local Consumer Aid Fund, for use for public 
education for privacy and civil rights related issues, forfeit ownership of the equipment used, and 



158 



publish a notice in a local newspaper advising potential victims to contact the Office of the Attorney 
General. 

In another significant case, the Division obtained a 10-year final judgment by consent against 
three male and one female Worcester-area teens, for allegedly threatening and intimidating an 
interracial couple living in Whitinsville. One youth allegedly identified himself as a member of the 
Eastern Hammer Skinheads, a nationally-known hate group. The youth allegedly stapled fliers 
containing racial epithets, threats, and a swastika symbol directly in front of the home of the black 
victim who was married to a white woman. The fliers threatened bodily harm to any black male who 
associated with a white female. The Division also obtained a permanent injunction against a youth 
who allegedly spray-painted racist and anti-Semitic graffiti on private residential property in Concord. 
As part of the consent judgment, the youth agreed to complete a 20-hour educational program provided 
by the Anti-Defamation League World of Difference Program. In another important case, the Suffolk 
Superior Court entered a preliminary injunction against two black youth based on allegations they had 
viciously and without provocation attacked three white youths on the basis of their race while on the 
MBTA redline in Dorchester in two separate incidents. 

Housing Discrimination 

The Division continues its vigorous enforcement of the state's fair housing laws, which 
prohibit discrimination on the basis of race, color, national origin, religion, sex, sexual orientation, 
familial status, marital status, source of income (receipt of housing subsidy), age or disability. 
In fiscal year 1996, seven new housing discrimination actions were filed in the Superior Court by the 
Division. These cases involve allegations of discrimination based on race, national origin, gender 
(sexual harassment), familial status and possession of a housing subsidy. One new case as well as 
eleven pending cases were favorably resolved through consent agreements during this period. 



159 



Settlements included injunctive and affirmative relief provisions, as well as agreements to provide 
compensatory damages to the victims. 

Among the settled discrimination complaints were cases filed in the MCAD on behalf of a 
couple with a three-month old child, against eight different realtors located in Allston, Brighton, 
Newton and Brookline, who allegedly refused to rent them an apartment because they had a child under 
six. The realtors allegedly engaged in a practice of steering tenants with young children away from 
rental units with lead-based paint, thereby shielding landlords from their statutory obligation to delead 
rental units occupied by families with children under six years of age. Each of the settlements included 
prohibitory and affirmative injunctive relief, and provided substantial monetary compensation to the 
complainants. Under these agreements, most of the defendant real estate companies are required to 
provide prospective tenants a notice of their rights under the state's lead paint and an ti -discrimination 
laws. Through these and other cases the Division has filed, the Attorney General hopes to modify 
realtor practices, to educate tenants about the right to fair treatment in the housing market and to 
increase the availability of safe, affordable housing for families with young children. This Division is 
also involved in cases that reflect our commitment to protecting the fair housing rights of individuals 
with disabilities, through its Disability Rights Project. 

The Attorney General believes that proactively working with various authorities and 
organizations through education and outreach is also an effective approach to eliminating housing 
discrimination. In that regard, in September of 1995, a representative from the Civil Rights Division, 
in conjunction with representatives from the MCAD and the Massachusetts Board of Realtors (MBR), 
participated in a "Risk Reduction Seminar" at the MBR's annual convention. The focus of the seminar 
was on realtor compliance with state and federal fair housing laws, as well as the Attorney General's 
enforcement obligations under the state's anti-discrimination law, Massachusetts General Law, chapter 
15 IB. As part of its effort at prevention, the Division has also provided comprehensive civil rights and 



160 



discrimination training to the entire management staff and at a later training session to all public safety 
officers of the Boston Housing Authority. 

Employment Discrimination 

In Fiscal year 1996, an Employment Discrimination Project was initiated in the Civil Rights 
Division to focus on systemic discrimination in employment. The Project investigates allegations of 
pervasive discrimination or harassment (race, sex, ethnicity, national origin, age, sexual orientation) in 
order to determine whether a particular employer or industry is engaged in a pattern and practice of 
discrimination, affecting substantial numbers of Massachusetts employees. The Division had 
previously filed a complaint alleging systemic age discrimination against Bull HN, a major 
information services company, in the MCAD arising out of its ongoing layoff of employees. In fiscal 
year 1996, a complaint was also filed in the Equal Employment Opportunity Commission ("EEOC") 
against Bull HN alleging violations of the Older Worker' s Benefit Protection Act ~ a federal statute 
that establishes certain criteria an employer must satisfy before obtaining a waiver of an age 
discrimination claim. The EEOC found probable cause to believe that Bull HN was violating that law 
and the Division intends to seek injunctive relief and a declaratory judgment in federal court 
establishing the law in this area. 

As an alternative to active litigation, the Project offers training as well as technical assistance 
on how employers should address systemic problems. For example, the Project is presently working 
with a large employer in Massachusetts in an effort to ensure that various measures are adopted that 
would address allegations of sexual and racial harassment. These measures range from instituting a 
computerized system which keeps track of complaints to improvement of its internal investigation 
process. 

The Employment Discrimination Project also files amicus briefs or intervenes in pending 
cases in state and federal courts when a legal question is raised which presents an issue of public 



161 



importance. In fiscal year 1996, the Project filed an amicus brief in the Supreme Judicial Court in a 
case entitled Melnychenko v. 84 Lumber Company . This case raised two issues of public importance: 
the scope of sexual harassment protection of employees under G.L. c. 151 B and the validity of a waiver 
in a termination agreement which precluded a former employee from cooperating with the EEOC or 
MCAD in an ongoing investigation of discrimination. 

Mortgage Lending Discrimination 

Since November 1992, the Division has been involved in a comprehensive attack on fan- 
lending barriers in the home mortgage lending industry in Massachusetts. In March 1994, the Attorney 
General, the Massachusetts Bankers Association (MBA) and 27 banks and mortgage companies 
entered into an unprecedented and far-reaching agreement to effect systemic reform of the mortgage 
lending industry in Massachusetts. Under the three-year agreement, the MBA agreed to establish six 
statewide programs and initiatives to encourage fair lending and to increase mortgage lending in urban 
and low and moderate income communities in Massachusetts. 

In December of 1995, the Division was invited by the Massachusetts Bankers Association to 
speak at the graduation ceremony for the second class (of twenty-five students) that graduated from the 
Roxbury Community College Mortgage Lending Career Development Education Program designed 
and established as a result of the agreement. As of that date, approximately seventy-five minority 
enrollees have graduated from the program's four different locations (Roxbury Community College, 
Northern Essex Community College in Lawrence, Bristol Community College in New Bedford, and 
Springfield Technical Community College). In addition, approximately twenty-five of those students 
have already secured permanent employment in the mortgage lending industry. 

Women's Constitutional Right To Choose 

In furtherance of the right of women in Massachusetts to access to the health care of their 
choice, the Division continues to offer legal advice and training to clinics offering abortion services 



162 



and to police departments responsible for maintaining safe access to clinics in their jurisdiction. The 

Division also lobbied on behalf of the Attorney General in support of the recently passed bill to extend 

insurance coverage to state employees for abortion-related services. 

In January of 1996, the Division filed an amicus brief in the Supreme Judicial Court on 

behalf of the plaintiffs in Planned Parenthood Inc. v. Bell . The Attorney General supported the 

authority of a court under common law to order an anti-abortion protestor, based on her conduct, to 

stay a defined distance from the entrance to a medical clime where abortions are performed. 

Sexual Orientation Discrimination In Employment, Housing and Public 
Accommodations 

In June 1995, the Attorney General joined a friend of the court brief in the U.S. Supreme 
Court arguing against a state constitutional amendment that prevented Colorado or any of its local 
governments from protecting gays and lesbians from any form of discrimination including 
discrimination in employment, housing and public accommodation. The Massachusetts Attorney 
General's Office was the first of six states in the nation to join the brief of the Oregon Attorney 
General's Office which argued against the legality of Colorado's constitutional amendment. The 
Division helped structure the legal arguments contained in the Oregon brief and enlisted additional 
legal support from other states for the amicus brief. In May 1996 the Supreme Court in Romer v. 
Evans declared this Colorado anti-gay amendment unconstitutional. The legal analysis used in the 
landmark decision was consistent with the arguments in this amicus brief which maintained that the 
amendment denied a fundamental right to an independently identifiable group, and violated the Equal 
Protection Clause to the Fourteenth Amendment to the United States Constitution. 

Right To Privacy 

In fiscal year 1996 the Division responded to citizen complaints that a local telephone 
company was taping calls to and from its sales force without the knowledge or consent of the 



163 



customers in violation of state wiretap law. As a result of the Attorney General's intervention, the 
company discontinued the practice and distributed an advisory to all its commercial clients on the law 
regarding taping of telephone communications. 

The Division is also involved in an ongoing effort to monitor the practices of the health care 
industry with regard to maintaining medical records confidentiality in the face of burgeoning 
communication technology. 

The Division revised and updated a 1989 Massachusetts Bar Association public service 
pamphlet titled "How to Protect Your Privacy." The pamphlet, published in May 1996, addresses the 
broad array of areas where privacy rights may be implicated: government records, credit reports, school 
records, insurance and employment reports, medical information, employee records and social security 
numbers. 

Police-Related Matters 

In a cooperative effort to promote civil rights, assist the police, and provide departments 
withtechnical assistance, the Division has continued to provide an extensive amount of civil rights 
training to police departments covering issues of civil liability, sexual harassment, racial and cultural 
awareness and hate crimes. The Division has sponsored many training sessions for police officers and 
police supervisors in cities and towns throughout Massachusetts, including Boston, Cambridge, Fall 
River, Framingham, Provincetown and Revere as well as for police departments located throughout 
Martha's Vineyard. The Division also provided intensive civil rights training to police cadets attending 
regional police academies located in Canton, Medford, and Somerville. The Division also made 
presentations on civil rights at the Massachusetts Bar Association educational program for campus 
police officers and attorneys in October 1995. The Division also made a presentation on hate crime 
identification, investigation and enforcement at the Attorney General's statewide conference on 
Juvenile Policing Issues for juvenile officers in April 1996. 



164 



The Division has also continued to investigate allegations of police misconduct, and has 
worked with departments to take remedial steps when credible evidence is found to substantiate the 
complaints 

OTHER SIGNIFICANT DIVISION INITIATIVES 

Race And Ethnic Bias In The Courts 

As a result of the findings in the report of the Supreme Judicial Court Commission on Race 
and Ethnic Bias in the Courts issued in September 1994, the Division has taken a leadership role in the 
formation of an office-wide Task Force. The Division Chief chairs the Attorney General's Task Force 
on Race and Ethnic Bias in the Courts and Division staff serve as active members. The Task Force 
consists of subcommittees on Cultural and Linguistic Barriers to the Justice System, Education and 
Training, Sentencing, and Jury and Jury Pools. In an effort to address cultural and linguistic barriers in 
the courts, the Task Force has prepared a booklet to assist victims of domestic violence to understand 
their rights and provide them with helpful resources and contacts. The booklet will be available in 
eight languages: English, Chinese, Vietnamese, Khmer, Portuguese, Spanish, Creole, and Russian. 

The Chief of the Division authored or coauthored six chapters for a Massachusetts Bar 
Association book published in May 1996 forjudges and attorneys titled "Ensuring Equal Justice: 
Addressing Cultural and Linguistic Differences in the Courts of Massachusetts." The chapters survey 
the law nationwide on cultural and linguistic issues in both criminal and civil proceedings. The book 
was distributed to all state court judges at an All Judges Conference in May of 1996. 

Hate Crimes Task Force 

The Chief of the Division continues to chair and Division staff continue to actively 
participate in the Attorney General's Interagency Law Enforcement Hate Crimes Task Force. The Task 
Force consists of federal, state and local prosecutors and law enforcement officials. Its focus is to 
coordinate efforts to investigate and prosecute hate crimes occurring in the Commonwealth. It also 



165 



organizes and sponsors presentations on an ongoing basis to develop increased expertise and 
cooperation among law enforcement on these important issues. In September of 1995, an anti- 
terrorism specialist with the FBI made a presentation on domestic and international terrorism and 
militias and the role of state and local law enforcement. In May of 1996, the Task Force invited the 
Deputy Director of the Southern Poverty Law Center's Klanwatch Project who addressed law 
enforcement representatives from the New England states, including Attorneys General offices and 
United States Attorneys' offices, regarding the criminal activities of national and local extremist 
organizations, organized hate groups and militias. 

Civil Rights In The Schools 

The Division has been active in education and outreach efforts on civil rights issues within 
the state's public school system. Its goal is to assist in educating students and staff about their rights 
and responsibilities as it relates to hate crimes, discrimination and sexual and racial harassment in 
schools. As part of its civil rights collaboration with the Boston School Department, Division 
attorneys have organized special civil rights training programs for police, school administrators and 
other staff of the Boston School Department to identify and respond to civil rights issues in the Boston 
public schools. In May 1996, the Division also trained the entire administrative staff and teachers at 
the Gavin Middle School on civil rights issues. The Division also played an instrumental role in 
organizing and making presentations at the Attorney General's Annual Conference of Civil Rights in 
the Schools held in March 1996. The conference was attended by teachers, school administrators and 
law enforcement officials statewide. The Division has also worked closely with the Massachusetts Bar 
Association and the Boston School Department to develop a sexual harassment curriculum for seventh 
and eighth grade public middle school students in Boston. 

The Division also made presentations on civil rights in schools at a conference sponsored by 
the Essex County District Attorney's office in February 1996 and the U.S. Department of Justice 



166 



Community Relations Service sponsored conference for the New England region in March 1996, with 
particular emphasis on the Attorney General's collaboration in developing a model civil rights 
prevention program with the Boston School Department. 

Legislative Initiatives 

The Division played a leading role in the drafting of statutory language and the lobbying for 
the successful passage of an amended state hate crimes statute. The bill amends G.L. c. 265, § 39, by 
extending the protection of this criminal civil rights statute to persons who are victimized by a crime 
because of their sexual orientation or disability. In addition, the bill permits a felony prosecution for 
criminal acts where serious bodily harm results, where previously such violations under the statute 
were misdemeanors. Finally, the bill provides restitution to the victim for monetary losses incurred 
due to property damages from being a victim of a hate crime. 

DISABILITY RIGHTS PROJECT 

Ensuring Equal Access To Private Businesses 

After litigation was initiated against the Royal Plaza Hotel and Trade Center of Marlborough 
in the Spring of 1995, the Disability Rights Project of the Division negotiated a consent judgement 
with the defendants. The August 1995 court-approved settlement established a six-month timetable for 
the hotel to address the eighty alleged violations of state and federal disability access laws, cited in the 
complaint. In addition to the court-approved time-frame for correcting the barriers to access for people 
with disabilities, the consent judgment also provided that the hotel pay ten thousand dollars to be used 
by the Commonwealth for the publication of consumer protection materials in alternative accessible 
formats, such as audiotape and braille, for individuals with visual impairments. 

Following up on a complaint from an elderly couple concerning the failure of the three movie 
theaters on Martha's Vineyard install assistive listening devices for individuals with hearing 
impairments, the Project informed the theater owners of their legal obligation to install auxiliary aids 



167 



and services to remove communication barriers. After a series of discussions, an agreement was 
reached which provided for installation of the listening devices prior to the opening of the theaters for 
the summer season. 

A family complained to the Project that the YMCA summer camp program on Cape Cod was 
not providing adequate camp opportunities and services to campers with disabilities. Project staff met 
with representatives of the Y and reviewed their policies and practices concerning disabled campers 
with them. An agreement was reached which provided that the camp would hire a specialized 
coordinator to oversee the services provided to campers with disabilities and to encourage their 
applications. In addition the camp agreed to review all of their policies to eliminate any that had an 
unintended negative effect on those campers. 

Office staff participated as a member of an advisory group to the newly constructed Fleet 
Center. The group shared its experience and expertise with the owners and operators of the Fleet 
Center so the Center would be able to address effectively the physical and communication access needs 
of the Fleet Center's patrons with disabilities. 

Protecting Fair Housing Rights Of Individuals With Disabilities 

The Disability Rights Project of the Division filed an amicus brief ("friend of the court") in 
the Supreme Judicial Court in Watros v. Greater Lynn Mental Health . The Project's brief supported a 
local zoning board of appeals' decision in favor of the town of Winchester's issuance of a special 
permit for the placement of a group residence for the mentally retarded. The zoning board decision had 
been successfully challenged by a neighbor in Superior Court. The Supreme Judicial Court in August 
1995 reversed the Superior Court decision, consistent with the position we had urged: that an 
educational use exemption under Massachusetts General Law, chapter 40A covers the use of a carriage 
house as a community residence. 



168 



An attorney representing the Protestant Guild for the Blind contacted the Project concerning 
his clients' efforts to rent an apartment as a community residence from a realtor in Arlington. After a 
series of inquiries concerning the nature of the prospective tenants' disabilities, the rental deposit was 
returned and the agreement to rent was canceled. Project staff contacted the realtor to explain the fan- 
housing implications. The realtor indicated his willingness to execute the lease but the owner 
continued to refuse to rent the apartment. After discussions with counsel for the realtor and the owner, 
the apartment was made available to the tenants with disabilities. 

Counsel for the May Institute contacted the Project because a city on the south shore had 
imposed more requirements on a community residence for individuals with mental retardation than 
would have been imposed on non-disabled residents. In order to comply with some of the licensing 
requirements from DMR, such as providing a second means of egress, the residence needed 
modification of the city's zoning setback requirements. The city had been unwilling to modify their 
requirements and had refused to issue the necessary permits. After Project staff had a series of 
conversations with the city solicitor, the city agreed to issue the previously withheld occupancy 
permits. 

Community Education 

Consistent with the strong emphasis upon community education articulated by the Attorney 
General at the inauguration of the Disability Rights Project, the Project has emphasized programs to 
increase people's understanding of and compliance with disability rights laws. Those efforts included: 
-Addressing some of the misinformation that existed with regard to the "handicapped parking/placard 
program," the Project, in cooperation with the Registry of Motor Vehicles and the Massachusetts 
Office on Disability, issued an advisory to all cities and towns concerning the Registry's "handicapped 
plate/placard program;" 



169 



-Establishing and implementation of a prototype training program on state and federal employment 
discrimination law for municipalities and not-for-profit organizations; 

-Co-sponsoring and participating in two workshops at the statewide ADA conference: "ADA Without 
Fear-Solutions for Local and State Government"; 

-Making presentations on the legal obligations imposed upon municipalities by Title II of the ADA at 
the annual statewide conference of Small Town Administrators Association, and at a regional 
Municipal Law Forum sponsored by various members of the state legislature; 

-Making presentations on the requirements of the ADA as it relates to educational institutions at an 
all-day faculty training program at Holyoke Community College and at a statewide ADA conference;; 

-Providing training on the fair housing rights of individuals with disabilities at a Massachusetts 
Continuing Legal Education program, at a Department of Mental Health Human Rights Conference 
and at the annual conference of the Association of Retarded Citizens Massachusetts, and publication of 
a pamphlet concerning the fair housing rights of individuals with disabilities under state and federal 
law; and 

-Making presentations on the work of the Disability Rights Project on several cable television shows, 
at Suffolk University Law School and at a Massachusetts Continuing Legal Education program. 



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CONSUMER PROTECTION AND ANTITRUST DIVISION 

The Consumer Protection and Antitrust Division enforces Massachusetts General Law 
chapters 93 and 93A as well as other state and federal consumer protection and antitrust statutes. The 
Division's case load primarily consists of actions affecting large numbers of vulnerable consumers who 
have been harmed by illegal activities, particularly fraud. Additionally, the Division seeks to protect 
and promote competition so that consumers are offered goods and services of higher quality at lower 
prices. Other efforts include regulatory and legislative activities, participating in consumer out reach, 
and mediating individual complaints through the Consumer Complaint and Information Section and the 
Local Consumer Programs. 

In fiscal year 1996, the Division obtained judgments or entered into settlements for the 
following amounts: 

MONEY RECOVERED 



CIVIL PENALTES/ATTORNEYS' FEES/COSTS 
CONSUMER RESTTTUTION 



$1,120,900 
$3,240,468 



LOCAL CONSUMER AID FUND 
OTHER: 

Fleet/Shawmut Merger 

Liggett Group, Inc. 
R.M. Packer Co., Inc. 



$ 122,500 



$175 million small business loan program 

$25 million loan programs for home rehabilitation loans 

and affordable housing mortgages 

2.5% of Liggett's pre-tax profits to Massachusetts for the 
next 25 years 

$12,500 worth of home heating oil to be provided to the 
South Shore Community Action Council Fuel Assistance 
Program 



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ADOPTION SERVICES 

Comm. v. Madeline Daniels and Cambridge Adoption and Counseling Associates, Inc. 

In fiscal year 1995, CPAD filed an action against CACA, and its director Madeline Daniels. 
The case alleges a variety of unfair and deceptive acts such as: misrepresenting fees; misrepresenting 
services; failing to provide services; negligent referral to incompetent agents; and withholding final 
approval of adoptions to collect disputed fees. 

In the past fiscal year, CPAD has opposed numerous motions filed by the defendants 
including: Defendants' Motion for Preliminary Injunction; Defendants' Motion for Impoundment; 
Defendants' Amended Motion for Impoundment; Defendants' Motion for Partial Summary Judgment; 
Defendants' Motion for Protective Order. With the exception of the last motion for a Protective Order 
relating to the deposition of defendant Madeline Daniels, all motions were denied. 

Comm. v. Adoption Center, Inc. and Judith Bailey 

This is an action alleging consumer protection and other violations by an adoption placement 
agency and its former Executive Director. On June 17, 1996, the Court entered a protective order to 
protect the confidentiality of adoptive parents and other persons who may be identified in documents of 
the adoption placement agency that might be produced during discovery. 

AMICUS BRIEFS 

Smiley v. Citibank 

On March 1 , 1 996, CPAD filed an amicus curiae brief on behalf of 25 states, urging the 
Court to protect consumers by not allowing national banks to ignore the credit card late charge laws of 
the respective states of their customers. On a broader level, the brief argued that a decision in the 
banks' favor would decimate efforts to enforce state consumer protection laws and would undermine 
state sovereignty. However, on June 3, 1996, the U.S. Supreme Court ruled a national bank must only 
comply with the laws of its "home state," in this case, South Dakota. 



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Urman v. South Boston Savings Bank 

On April 12, 1996, CPAD filed an amicus brief in support of certain consumers' appeal from 
a decision of the Norfolk Superior Court. The Superior Court had held that the South Boston Savings 
Bank had not violated c. 93A by failing to disclose to two home buyers that their new home was 
located on a toxic contamination clean-up site and was surrounded by toxic contamination. The 
amicus brief asserted that the failure to disclose the contamination problem amounted to a material fact 
that may have reasonably influenced home buyers not to enter into the transaction and thus violated c. 
93A, § 2(a) and 940 C.M.R. §3.16(2). The case is pending. 

Greenfield Country Estates Tenants Association, Inc. v. Deep 

On June 26, 1996, the Supreme Judicial Court upheld the rights of certain mobile home 
residents to exercise their statutory right of first refusal under the Manufactured Housing Act. CPAD 
had filed an amicus brief in support of the residents and participated in oral argument at both the trial 
and SJC levels, addressing the defendants' takings challenge to the statutory provision creating the right 
of first refusal. The court rejected this constitutional challenge, reasoning that since the statute did not 
deprive an owner of economically viable use of his property, it did not constitute a taking. 

ANTITRUST 

Fleet-Shawmut Merger 

On September 14, 1995 the office entered into an agreement with Fleet Financial Group 
approving the merger of Fleet with Shawmut National Corporation. To resolve competitive concerns, 
the agreement requires Fleet to divest 18 bank branches statewide to insure the continued competitive 
marketplace for Massachusetts consumers. 

The centerpiece of the agreement is a program that provides $100 million in prime interest 
rate loans to small businesses. The loans will be available statewide, but will be targeted to assist low 



173 



and moderate-income neighborhoods, and directed to companies seeking to add new jobs to the 
economy. A minimum of 1 ,000 small businesses must receive loans under the agreement. 

The agreement also provides for $75 million in loans under the U.S. Small Business 
Administration's lending program. For these loans, Fleet has agreed to waive the 2 percent guarantee 
fee charged under the SBA program and to provide a 1 percent interest rate reduction for half of the 
loans made under the program. The agreement also provides for $25 million in funding for 
rehabilitation loans and affordable housing mortgages as well as a commitment to maintain or increase 
its level of charitable contributions. 

Comm. v. SSC Associates, L.P. and Stop & Shop Companies, Inc. , 

On October 31, 1995, CPAD filed a consent judgment authorizing the merger of the Stop & 
Shop and Purity supermarket chains. The agreement required Stop & Shop to divest 17 stores in areas 
in which the merger might have adversely affected consumers. The consent judgment also required 
Stop & Stop to continue to operate two inner-city supermarkets or to sell those two stores to a buyer 
that would continue to operate the stores as a supermarket. 

The agreement also requires Stop & Shop to seek the prior approval of the AG before 
acquiring any additional supermarkets in eastern Massachusetts in the next two years and to pay 
$10,000 in costs to the Attorney General's Office. 

In the Matter of Berkshire Health Systems. Inc. 

On January 3, 1996, CPAD filed an assurance of discontinuance resolving concerns that 
certain individuals at Berkshire Medical Center had entered into or required exclusive contractual 
agreements with Blue Cross and Blue Shield of Massachusetts and had agreed to or solicited a boycott 
of Hillcrest Hospital in Pittsfield, and/or Harvard Community Health Plan. The agreement requires 
Berkshire Health Systems to pay $75,000 to the Commonwealth: $50,000 to the Local Consumer Aid 
Fund, to be used by SCORE, and $25,000 for costs of the investigation. 



174 



In addition, the agreement required Berkshire Health to refrain from any exclusive agreement 
with any third-party payor or health care provider and to negotiate in good faith, subject to availability 
of services, with any and all third party payors and health care providers seeking entry or expanding 
their access within the Berkshire market. 

Comm. v. R.M. Packer Co., Inc. 

On March 19, 1996, CPAD filed a consent judgment in Dukes Superior Court requiring R.M. 
Packer Co., Inc. to pay the Commonwealth $10,000 in lieu of civil penalties and to provide, free of 
charge, home heating oil worth $12,500 to the South Shore Community Action Council Fuel 
Assistance Program. CPAD's antitrust lawsuit alleged that Packer solicited other home heating oil 
retailers to fix the price of home heating oil sold to customers on Martha's Vineyard. The consent 
judgment also prohibits R.M. Packer from fixing, arranging to fix, facilitating or agreeing to fix the 
price of home heating oil. 

In the Matter of Partners Healthcare System and North Shore Medical Center. Inc. 

On March 29, 1996, the CPAD filed an assurance of discontinuance in Suffolk Superior 
Court with Partners Health Care System, Inc. ("Partners") and The North Shore Medical Center, Inc. 
("North Shore") which limits the number of physicians the merged system can control. The merged 
system includes the Partners Health Care System hospitals (Massachusetts General Hospital, Brigham 
& Women's Hospital, and Spaulding Hospital) and The North Shore Medical Center hospitals (Salem 
Hospital and Shaughnessy-Kaplan Hospital, Inc. of Salem). 

Under the terms of the assurance, the total number of physicians that Partners employs, has a 
controlling interest in, or has an exclusive risk contract with, cannot exceed 40% of the available 
primary care physicians, pediatricians, and obstetrician-gynecologists in the area comprised of 26 
North Shore communities. 



175 



The assurance also requires Partners to report to the Attorney General periodically on its 
compliance with the physician cap, and prohibits Salem Hospital from requiring physicians to 
participate in The North Shore Health System as a condition of appointment to the medical staff. 

In the Matter of Southcoast Health System 

On June 11, 1996, CPAD filed an assurance of discontinuance in Suffolk Superior Court 
which allowed the merger of Charlton Hospital in Fall River and St. Luke's Hospital in New Bedford to 
go forward and the formation of Southcoast Health System. Tobey Hospital in Wareham is the third 
hospital involved in this merger. 

The assurance requires the hospitals to maintain a community-based board, to not raise rates 
to third party payers for inpatient services more than the medical consumer price index for the next 
three years and to file yearly financial reports with the Attorney General. 

Bank of Boston-BayBank Merger 

On June 18, 1996, after a extensive antitrust review conducted in conjunction with the 
Department of Justice, CPAD approved the merger of Bank of Boston and Baybanks. The approval 
came in the wake of the proposed sale to USTrust of a total of twenty BayBank and Bank of Boston 
branches with $860 million in deposits. 

The joint merger review revealed a potential threat to competition for middle market 
commercial and industrial loans in Massachusetts. The sale of the twenty branches and the transfer of 
the associated deposits and loans to USTrust addresses the competitive concerns raised by Bank of 
Boston's acquisition of BayBank. 

United States, et al. v. The Thomson Corporation and West Publishing Company 

On June 19, 1996, Massachusetts, along with the Department of Justice and the Attorney's 
General of six other states filed a joint antitrust suit and consent judgment against Thomson 
Corporation and West Publishing Company the nation's largest legal publishers. The merger raised 



176 



antitrust concerns that were addressed in a settlement with the two companies that was filed along with 
the lawsuit. 

The setdement requires Thomson to divest a large number of publications that compete 
directly with West publications, including the Annotated Laws of Massachusetts, Massachusetts 
Landlord-Tenant Law, United States Code Service, United States Reports, Lawyers' Edition and Auto- 
Cite, among others. The total value of the divested products is in the range of $275 to 300 million. 

Other terms of the settlement require Thomson to grant to Lexis-Nexis options to extend for 
five years its current licenses for three important databases: Investext, ASAP, and Predicasts. The 
setdement also requires Thomson to license to any third party the right to use the internal pagination in 
all publications in West's National Reporter System. 

AUTOMOBILES 

Comrn. v. Paul Gibbons d/b/a Specialty Cars of New Hampshire, et al. 

On September 18, 1995, CPAD filed a complaint against Paul Gibbons d/b/a Specialty Cars 
of New Hampshire, an unlicensed used car dealer who was selling cars that failed to pass inspection or 
were otherwise defective, and refusing to repair the cars or make refunds to consumers. The dealer 
also violated the automobile advertising regulations, and various other regulations regarding used car 
dealers. A preliminary injunction was issued on October 16, 1995, which enjoins the defendants from 
further unlicensed sale of automobiles. 



"Sour Deals Sting" 

Comm. v. A-Classic Auto Body and Repair 
Comm. v. Automaster 
Comm. v. Cambridge Auto 
Comm. v. CarQuest Auto Sales 
Comm. v. Dodakin's Auto Sales 
Comm. v. Global Motor's Inc. 
Comm. v. Grant's Cars Are Us Auto Sales 
Comm. v. Harbor Auto Sales. Inc. 



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Comm. v. Main Street Auto Sales 
Comm. v. Main Street Auto Mart 
Comm. v. Mutual Auto Sales 
Comm. v. St James Auto Sales 
Comm. v. Tom-E's Auto Sales, Inc. 
Comm. v. Tryba Auto Sales 
Comm. v. Unique Motors, Inc. 

In fiscal year 1996, CPAD, in conjunction with the Civil Investigative Division conducted a 
statewide survey of car dealers for compliance with state and federal car warranty notice and pricing 
regulations. 

Under federal law, dealers must post notices on all used cars for sale, informing consumers 
of their right to express or implied warranties. State law requires dealers to post notices to inform 
consumers that they have 30, 60 or 90 days to have repairs performed on vehicles under warranty, 
depending on mileage, when the vehicle costs at least $700. In addition, all vehicles sold in the 
Commonwealth must have a posted price, and are subject to an "implied warranty." 

Each of the above referenced cases was resolved through the filing of a consent judgment 
requiring the dealer to post clearly all appropriate notices on vehicles offered for sale to the public, 
including an offering price, in the future. Each dealer was also required to pay a civil penalty of 
$1,000. 

Comm. v. Visone Motors, Inc., et al. 

In fiscal year 1996, CPAD oversaw the continued implementation and conclusion of the 
restitution process required by a 1993 consent judgment entered with Visone Motors, Inc. Pursuant to 
the consent judgment, Visone was require to offer a fair and reasonable settlement to each of the over 
200 consumers who filed complaints with the Office. If the settlement was not acceptable to the 
consumer, the matter went to an arbitrator who proposed a resolution that Visone was required to 
implement. 



178 



Over 200 consumers had their complaints resolved through the settlement or arbitration 
process, with over $415,000 in cash or merchandise distributed to consumers. 

Automobile Advertising Cases 

Comm. v. Village Automotive Group, Inc. et al. 

On August 15, 1995, a complaint and consent judgment were filed, enjoining Boston Toyota 
and Boston Volvo Village from running misleading or deceptive advertisements and requiring them to 
pay $5,000 in penalties. The complaint alleged that the dealership violated Massachusetts automobile 
advertising regulations by advertising used cars for sale without clearly and conspicuously disclosing 
that the cars were used and by using term such as "loaded" or "fully equipped" to describe autos offered 
for sale. 

Comm. v. Copeland Toyota 

On October 26, 1995, a complaint and consent judgment were filed, enjoining Copeland 
Toyota from running misleading or deceptive advertisements and requiring them to pay $2,500 in 
penalties. The complaint alleged that the dealership violated Massachusetts automobile advertising 
regulations by advertising used cars for sale without clearly and conspicuously disclosing that the cars 
were used and by advertising a sale without clearly and conspicuously disclosing the expiration date of 
the sale. 

Comm. v. Kelly Jeep Eagle, Inc., et al. 

On February 14, 1996, a complaint and consent judgment were filed, enjoining Kelly Jeep 
Eagle, Inc., Roland D. Kelly Buick, Inc., and Roland D. Kelly Infinity, Inc. from running misleading or 
deceptive advertisements and requiring them to pay $2,500 in costs to the Commonwealth and $2,500 
to the Attorney General's SCORE program. The complaint alleged that the dealership violated 
automobile advertising regulations by advertising used cars for sale without clearly and conspicuously 



179 



disclosing that the cars were used and by advertising car leases without disclosing further information 
required by federal law and regulation. 

CIVIL FORFEITURE 

Comm. v. One 1993 Mitsubishi Eclipse 

This is a civil forfeiture action filed in Middlesex Superior Court in fiscal year 1995, 
involving the forfeiture of an automobile that was used in connection with illegal drug activity. The 
action is an in rem proceedings brought pursuant to the provisions of G.L. c. 94C, § 47(d). An 
agreement for judgment was filed on October 25, 1995, whereby judgment entered in favor of the 
Commonwealth for forfeiture of the vehicle. 

Comm. v. One 1988 Honda Accord Sedan 

This is a civil forfeiture action brought in Worcester Superior Court on July 18, 1995, 
involving the forfeiture of an automobile that was used in connection with illegal drug activity. The 
action is an in rem proceedings brought pursuant to the provisions of G.L. c. 94C, § 47(d). 

Commonwealth v. One Thousand Six Hundred Twenty Seven Dollars 

This is a civil forfeiture action brought in Suffolk Superior Court on July 28, 1995 involving 
the forfeiture of cash that allegedly was used in connection with illegal drug activity. The action is an 
in rem proceedings brought pursuant to the provisions of G.L. c. 94C, § 47(d). 

FINANCIAL 

Comm. v. Richard North & North Asset Management, Inc. 

On July 7, 1995, CPAD obtained a default judgment against Richard North and North Asset 
Management, Inc. CPAD alleged in its complaint that North, individually and in his capacity as an 
officer and director of North Asset Management, Inc., solicited and received over $450,000 from 
consumers purportedly for the purpose of investing the money. Some or all of the investments were 
never made and the funds were dissipated by the defendants. 



180 



The default judgment permanently enjoins North from providing financial services to the 
public and requires the payment of $871,232.30 in restitution to consumers and $70,000 in civil 
penalties. 

Comm. v. John Corcoran, d/b/a Tempest Corporation 

On July 10, 1995, CPAD filed a complaint in Barnstable Superior Court against John 

Corcoran d/b/a Tempest Corporation. The complaint alleges that Corcoran operated an illegal pyramid 

scheme that he marketed as a "profit sharing plan." The pyramid scheme provided that in exchange for 

$10, a consumer is entitled to receive a variety of stationery to use to recruit new consumers. Each 

consumer received $1 per month for every other person they recruited into the program. 

Check Cashing Cases 

Comm. v. Felipe Castillo d/b/a Emilio's Market 

Comm. v. Fiesta Exchange Services, Inc. 

Comm. v. Sosa's Furniture Store, Inc. 

Comm. v. Felix Rodriguez d/b/a Fargo's Express 

Comm. v. Colon's Place, Inc. 

Comm. v. Calling Center Services, Inc. 

In August, 1995, CPAD filed suit against six check cashing companies for allegedly cashing 

checks without having the required licenses from the Division of Banks. Of the six, three have been 

resolved through the entry of consent judgements enjoining the operation of unlicensed check cashing 

operations and requiring the payment of a civil penalty. The cases resolved through consent judgments 

are: 

Comm. v. Fiesta Exchange Services, Inc. - $1000 civil penalty 

Comm. v. Sosa's Furniture Store, Inc. - $2500 civil penalty 

Comm. v. Colon's Place, Inc. - $1500 civil penalty 



181 



A fourth case, Comm. v. Felipe Castillo d/b/a Emilio's Market , was resolved through the entry of a 
default judgment, enjoining the operation of an unlicensed check cashing operation and requiring the 
payment of a $5,000 civil penalty. The remaining cases are currently in litigation. 

Also in August, 1995, CPAD filed assurance of discontinuance in Suffolk Superior Court 
against six additional check cashing companies for alleged violations of Division of Banks regulations. 
The alleged violations include failure to post fee schedules, licenses and information on how to file a 
complaint with the business and the Division of Banks. Other alleged violations include failure to 
provide receipts to customers that contain information such as the check casher's name and license 
number, the date of the transaction and the amount of the check casher's fee. Each of the assurances 
prohibits the alleged illegal activity, requires the companies to comply with applicable regulation and 
requires the following monetary payments: 

In the Matter of Shriji Variety Store, Inc. 

$1000 civil penalty 

In the Matter of The Pawn Shop, Inc. d/b/a The Money Stop 

$1000 civil penalty 

In the Matter of Boston Check Cashers, Inc. 

$500 to Local Consumer Aid Fund and $500 civil penalty. 

In the Matter of Samir Sidhom d/b/a American Check Cashing 

$500 civil penalty 

In the Matter of Chios Enterprises, Inc. d/b/a American Check Cashing 

$500 civil penalty 

In the Matter of Tiffany Corporation d/b/a Easy Check Cashing 

$500 civil penalty 

In the Matter of Randolph L. White. D 

On November 17, 1995, the Court granted the Commonwealth's Motion for Summary 
Judgment on its Adversary Complaint that the Debtor should be denied a discharge for failing to obey 



182 



lawful orders of the Court. The Commonwealth had concluded its c. 93A trial against the Debtor in 
Suffolk Superior Court in September, 1995 and is waiting for the Superior Court to issue its findings. 

Comm. v. DTM Financial Services et al. 

On April 11, 1996, CPAD filed a complaint against DTM Financial Services, a credit repair 
services company for allegedly misrepresenting the effectiveness of its "credit repair kits" to remove all 
negative items from consumer credit reports. This action was filed as part of joint effort with the FTC 
called "Operation Payback." A TRO and preliminary injunction were obtained prohibiting DTM, its 
affiliates and owners/operators from accepting payment until full and complete satisfactory 
performance of credit repair services is provided to consumers. This case was one of several to be 
brought nationwide to enforce the FTC's new Telemarketing Sales Rule. 

GENERAL 
In the Matter of Gregory P. Stamas 

An assurance of discontinuance was filed on August 3, 1995, in Suffolk Superior Court, 
whereupon Gregory P. Stamas agreed to refrain from engaging in the business of marketing and selling 
of baby furniture in the future. The Attorney General alleged that Gregory P. Stamas violated the 
Massachusetts Consumer Protection Act, G.L. c. 93A, §2(a) and the Attorney General's Regulations 
by: failing to perform services, in whole or in part, in accordance with his agreements with consumers 
and misrepresenting the exact nature and extent of his refund policy and failing to perform promises 
made to consumers in connection with the refund policy. 

In the Matter of George P. Stamas 

An assurance of discontinuance was filed on August 24, 1995, in Suffolk Superior Court, 
whereupon George P. Stamas agreed to refrain from engaging in the business of marketing and selling 
of baby furniture in the future. The Attorney General alleged that George P. Stamas violated the 
Massachusetts Consumer Protection Act, G.L. c. 93A, §2(a) and the Attorney General's Regulations 



183 



by: failing to perform services, in whole or in part, in accordance with his agreements with consumers; 
representing to consumers that he would provide baby furniture in a timely manner when, in fact, he 
had no intention of doing so; soliciting and accepting money from consumers for particular services 
when, in fact, he had no intention of performing such services; misrepresenting the exact nature and 
extent of his refund policy and failing to perform promises made to consumers in connection with his 
refund policy; and making false and deceptive representations concerning delivery of the baby 
furniture. 

In the Matter of Paul G. Stomas 

An assurance of discontinuance was filed on August 22, 1995, in Suffolk Superior Court, 
whereupon Paul G. Stamas agreed to refrain from engaging in the business of advertising, marketing, 
and selling of baby furniture in the future. The Attorney General alleged that Paul G. Stamas violated 
the Massachusetts Consumer Protection Act, G.L. c. 93A, §2(a) and the Attorney General's Regulations 
by: failing to perform services, in whole or in part, in accordance with his agreements with consumers; 
representing to consumers that he would provide baby furniture in a timely manner when, in fact, he 
had no intention of doing so; soliciting and accepting money from consumers for particular services 
when, in fact, he had no intention of performing such services; misrepresenting the exact nature and 
extent of his refund policy and failing to perform promises made to consumers in connection with his 
refund policy; making false and deceptive representations concerning delivery of the baby furniture; 
making false and deceptive representations concerning the nature of the business he conducted, his 
qualifications to conduct it, and the services provided; engaging in deceptive advertising; making false 
and deceptive representations concerning his lay away plans; and failing to provide consumers with 
written notice that payments made under the lay away plan were not refundable and keeping deposits 
after cancellation of the sales agreement. 



184 



In re NNLC Corp. 

In September, 1995, the Attorney General distributed nearly $19,000 in refunds to 
Massachusetts consumers of Lectra City, an electronic store chain that went into bankruptcy. The 
Attorney General had filed a proof of claim in bankruptcy court on behalf of the consumers. 

Comm. v. New England Marketing Services, Inc., et al. 

On November 8, 1995, the Attorney General obtained a Judgment against New England 
Marketing Services, Inc. and its principal, Pierre Valldejuli, ordering Mr. Valldejuli to pay more than 
$330,000 in restitution and $250,000 in civil penalties under c. 93A section 4. The defendants had sold 
time-share units to consumers but had failed to deliver deeds or refunds. 

Comm. v. V&M Management, Inc. 

This is a still pending civil action against the owner of a 276-unit HUD subsidized housing 
complex known as Westminster Willard a/k/a Mandela. It is alleged that the owners engaged in unfair 
and deceptive practices by violating a multitude of federal and state laws and regulations governing the 
rental of subsidized housing. In 1995, the Commonwealth opposed the defendants' motion to remove 
the case to federal court, and the federal court remanded it. In 1996, the defendants' property was 
placed under the authority of a trustee in bankruptcy, and is in the process of being brought into 
compliance with applicable laws and regulations. The grounds for seeking appointment of a trustee 
were financial mismanagement of the property and failure to pay taxes. 

Comm. v. John Amaral d/b/a U.S. College of Music 

On March 8, 1996, a consent judgment was filed in Suffolk Superior Court prohibiting John 
Amaral, doing business as U.S. College of Music, from engaging in misleading business practices. 
Under the judgment, Mr. Amaral is enjoined from using the designation "college" in the name of his 
business without obtaining the necessary authority from the Secretary of State; offering degrees without 



185 



being authorized to award degrees by the Secretary of State; and operating a correspondence school in 
the Commonwealth without being licensed by the Commissioner of Education. 

The consent judgment also requires the payment of $2,300 as civil penalties to the Attorney 
General's office. 

Comm. v. AmCan Enterprises, Inc. et al. 

On March 20, 1996, the Suffolk Superior Court held pursuant to the Commonwealth's 
Motion for Summary Judgment that the defendants, publishers of a business-to-business Yellow Pages, 
had used a deceptive solicitation in violation of chapter 93A. A hearing to assess damages, civil 
penalties, and attorney's fees was held on April 25, 1996. CPAD is awaiting a decision from the court 
on these issues. 

Comm. v. Employment Network, Inc., Job Select, Inc. and James Rasch 

On May 12, 1996, the Office filed a complaint in Suffolk Superior Court alleging that 
Employment Network, Inc., Job Select, Inc. and their principal, James Rasch, violated the Consumer 
Protection Act in connection with the offering of an employment information service. The complaint 
alleges that the defendants placed false and misleading newspaper advertisements regarding 
employment opportunities, made material misrepresentations about the services offered, and accepted 
payment for services without providing the promised services or making refunds to consumers. 
In a consent judgment filed on May 17, 1996, the defendants are permanently enjoined from engaging 
in unfair or deceptive acts or practices in connection with the advertisement, sale and provision of 
employment information services. In addition, the defendants are required to pay restitution to 
consumers, civil penalties, and costs to the Commonwealth in the total amount of $15,500. 



186 



Comm. v. Federal Record Service Corp. 

On May 14, 1996, CPAD filed a complaint in Suffolk Superior Court, alleging that Federal 

Record Service Corp. violated the Consumer Protection Act by mailing deceptive solicitations offering 

services relating to the procurement of Social Security Numbers. 

Comm. v. Michael Campbell, Lawrence Kreger, and Regina Bagdon, d/b/a Department 
of Employment Services 

On June 14, 1996, CPAD obtained a temporary restraining order in Plymouth Superior Court 
against Thomas Campbell, Lawrence Kreger and Regina Bagdon, d/b/a Department of Employment 
Services, Department of Employment Services of Massachusetts, Employment Relief, and 
Employment Relief Department of Massachusetts. The defendants allegedly used deceptive names to 
pose as state agencies, and then charged consumers for so-called "free" at-home employment services. 
The temporary restraining order enjoined the defendants from advertising and accepting fees for job 
assistance services. 

On June 24, 1996, the court entered a preliminary injunction enjoining the defendants on the 
same terms as in the temporary restraining order. 

HEALTH AND MEDICAL ISSUES 

Comm. v. Herbert Schurgin and Kenneth Eterian d/b/a Amesburv Vision Center 

On August 22, 1995, CPAD filed an assurance of discontinuance in Suffolk Superior Court 
against Amesbury Vision Centers and its operators Herbert Schurgin, O.D. and Kenneth Eterian 
R.O.D. The defendants allegedly advertised a "two for one" deal without disclosing that a free pair of 
glasses was not available to consumers who purchased the initial pair through insurance. 
The assurance prevents the defendants from advertising that they will provide two pairs of eyeglasses 
for the price of one without clearly and conspicuously disclosing material restrictions of the deal. The 
assurance also required the defendants to pay a $750 penalty. 



187 



Comm. v. Telebrands Corporation and Ajit Khubani 

On September 21, 1995, Massachusetts and 10 other states (Minnesota, Texas, Pennsylvania, 
Arizona, Illinois, Missouri, Wisconsin, Florida, Connecticut and California) filed suit against 
Telebrands Corporation and its president, Ajit J. Khubani, for selling a hearing aid without proper FDA 
approvals and for falsely advertising the product. 

The Whisper XL had not been approved by the FDA as a hearing aid prior to its being sold to 
in the Commonwealth and advertisements claimed a wearer would be able to "hear a whisper up to 100 
feet away." 

Comm. v. U.S. Health, Inc. et al. 

On October 10, 1995, a consent judgment was entered in Suffolk Superior Court resolving 
CPAD's contempt case against the corporations that operate the Holiday Health spas in Massachusetts. 
The contempt suit alleged that Holiday Committed civil contempt by violating the terms of a 1989 
consent judgment. 

The 1995 consent judgment provides for the payment of $300,000 civil penalties, detailed 
injunctive relief aimed at future compliance with the health club services contract statute, and complete 
restitution through a program of arbitration for all injured consumers who had complaints on file with 
the Attorney General's Office at the time of entry of judgment and for all consumers who filed 
complaints within 60 days of the date of entry of judgment. More than 1 ,200 consumers are 
participating in program. 

In the Matter of Merck & Co. and Medco Containment Services. Inc. 

On October 25, 1995, Massachusetts and 16 other states entered into a multistate consumer 
protection settlement with Merck and Medco, two of the nation's largest health care companies. 
Merck, a large pharmaceutical company, acquired Medco, a large prescription benefit management 



188 



company, in November of 1993. Medco started to market Merck prescription drugs as preferred drugs 

without disclosing important information to prescribing physicians and consumers. 

The settlement required the companies to pay $1 15,000 in costs to each of the states and 

required Medco's pharmacists to make certain disclosure to consumers' physicians, such as the fact that 

he or she is calling on behalf of Medco and that the pharmacy is owned by Merck. 

In the Matter of Community Outreach For Reconciliation and Empowerment Inc. and 
Spectrum Addiction Services, Inc. 

On March 29, 1996 an assurance of discontinuance was filed in Suffolk Superior Court 
requiring the payment of $157,038 to the Commonwealth as reimbursement for non-reimbursable costs 
which Community Outreach for Reconciliation and Empowerment, Inc. ("CORE") had wrongfully 
claimed as operating costs. CORE allegedly misused public funds it received in connection with 
residential and non-residential services it provided to the Department of Youth Services and the 
Department of Social Services. The assurance further provides for injunctive-type relief relating to 
future compliance with regulations of the Division of Purchased Services. 

Comm. v. Marjorie Phillips d/b/a New Discoveries 

This case was CPAD's first consumer protection case involving the Internet. On April 2, 
1996, CPAD brought a chapter 93 A action and obtained a temporary restraining order against a woman 
for false and deceptive advertising on her World Wide Web "page." She claimed to have a cure for 
HTV and AIDS which she would divulge for a price. The case was resolved with a consent judgment, 
filed on April 25, 1996 which enjoined her from making misrepresentations in advertising a cure for 
HTV/AIDS. 



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HOUSING AND HOME IMPROVEMENT 

Commonwealth v. Customized Structures Inc., James Dunlevy and Town & Country 
Modular Homes, Inc. 

On August 9, 1995, CPAD filed a complaint in Suffolk Superior Court, alleging that James 

Dunlevy and his company. Town and Country, falsely induced customers into purchasing Customized 

Structures' modules as materials for the consumers' modular home construction. CPAD alleged 

Customized Structures was vicariously liable, and also that certain materials were defective. 

Customized agreed to the entry of a consent judgment on November 30, 1995, agreeing to an 

injunction governing its business practices, and agreeing to pay consumers restitution and construction 

services valued at approximately $60,000. Dunlevy and his company settled on February 1, 1996, 

agreeing to be banned from the industry for life, to be liable for $168,000 in restitution and to pay a 

$1,000 penalty. 

Comm. v. John E. Bowen, d/b/a Bowen Construction Company and Peter Ingraldi aka 
Peter Bowen 

On November 6, 1995, a consent judgment was filed in Suffolk Superior Court against John 
Bowen d/b/a Bowen Construction Company. Bowen allegedly misrepresented the value and nature of 
home improvements provided by Bowen to elderly consumers. Pursuant to the consent judgment, John 
Bowen agreed to perform 180 hours of community service and provide elderly consumers with 
consumer information bulletins. 

Commonwealth v. Timothy Rich d/b/a Air Temp Engineering 

On October 27, 1995, CPAD filed a complaint in Suffolk Superior Court against a chimney 
installer and repairman for failing to obtain licenses and permits required for installation and removal 
of home heating, cooling and ventilation systems. A temporary restraining order and a preliminary 
injunction were obtained prohibiting the defendant and his employees from engaging in home 
improvement work without first obtaining appropriate plumbing, heating and other permits. 



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Comm. v. Bird, Inc. 

On December 12, 1995, the Division filed an assurance of discontinuance in Suffolk Superior 
Court, against Bird Roofing Company, Inc. of Norwood, Mass. It was alleged that: Bird manufactured 
shingles in the mid-1980's which were warranted to last twenty, twenty-five or thirty years, depending 
upon the shingle type; several years after installation, but before the warranty period expired, many of 
the shingles cracked and deteriorated prematurely; consumers who made claims against the company 
discovered that Bird's written warranty did not cover the cost of labor and materials required to repair 
or replace the shingles. 

Bird agreed to pay consumers almost twice the amount provided under the terms of its express 
warranty to repair or replace defective shingles (the exact calculation of warranty coverage depends 
upon when the claim against Bird was filed, the type of shingle, length of the warranty period and 
whether the consumer is required to tear off existing shingles to make the repairs). Bird also agreed to 
expand its warranty protection to consumers who experience shingle cracking in the future. Over 100 
consumers made claims; most received settlements which were increased by several hundred dollars. 
The total amount of restitution to date exceeds $50,000, but the increased warranty payments mean that 
the benefit to consumers is continuing as claims are made. 

Comm. v. William James Wareham d/b/a Paramount Roofing and Home Repair 

In December, 1995, CPAD obtained a default judgment in Suffolk Superior Court against 
William James Wareham d/b/a Paramount Roofing and Home Repair. CPAD alleged that Wareham 
held himself out as a roofer without being licensed with the state, took deposits in amounts greater than 
permitted by Massachusetts law, and then in some cases, failed to perform any roofing work or to 
refund consumers' deposits in full. 



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The default judgment enjoins Wareham from the alleged activities and requires the payment of 
$550 in restitution and $10,000 in civil penalties. 

Comm. v. Richard Kivel, et al. 

In fiscal year 1995, CPAD filed a complaint and obtained a temporary restraining order against 
Richard Kivel, and the businesses he runs, including Advanced Security Technologies, Inc., American 
Home Investments, Inc. and American Home Products, from doing further business unless and until 
they obtain the required professional licenses and registrations from three State Boards. 

The Commonwealth alleged that in addition to operating without the required licenses and 
registrations, Kivel engaged in a variety of unfair or deceptive acts or practices in the conduct of his 
businesses, including misrepresenting that he was an authorized dealer of certain brand products, 
encouraging elderly consumers to take out loans to purchase expensive products and services that cause 
the consumers to become indebted beyond their limited means and installing home security products in 
such a shoddy and unprofessional manner that they do not work as promised if at all. 

On February 7, 1996, a consent judgment was entered wherein Kivel agreed to be banned for 

life from the home improvement business, to be liable for $20,000 in restitution, and to be liable for 

$15,000 in penalties. The consent judgment also bans co-defendant Joan Robinson for life, and 

required her to pay a $1,500 penalty. 

Comm. v. Kenneth J. Aborn, John B. Ristuccia. and Paul Swerling, d/b/a Better Home 
Concepts, Inc. 

In June 1992, CPAD filed a complaint against the defendants for allegedly violating the 

Massachusetts Consumer Protection Act in the offering and sale of residential construction and home 

improvement services and the arrangement of financing in connection with those services. 



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In February, 1996, separate consent judgments were entered in Suffolk Superior Court against 
John Ristuccia, Paul Swerling and Kenneth Aborn providing that each shall be permanently barred 
from the home improvement contractor business in the Commonwealth. 

Comm. v. Chatham Development Co., Inc. 

On June 3, 1996, CPAD filed a complaint in Middlesex Superior Court against Chatham 
Development Co. Inc., alleging the company employed illegal lease provision in its leases for 
Woodland Park apartments, in Auburndale. 

On June 26, 1996, CPAD obtained a preliminary injunction on the issue of landlord charging 
tenants $25 for Constable Service of Notice to Quit when rent was as little as one day late. State law 
states that no penalty is due until the rent is 30 days or more overdue. 

MOBILE HOMES 

Little, et al. v. Northway Investment Properties, Inc (Green Meadows) 

On March 8, 1996, CPAD intervened in a Suffolk Superior Court action in an attempt by a 
Receiver to close Green Meadows, a mobile home park in Peabody with 40 mobile homes and 1 10 
residents. CPAD argued that the Receiver failed to comply with the Massachusetts mobile home 
statute. 

CPAD moved to intervene in this receivership proceeding involving eleven businesses and 
related entities, and filed an objection to the receiver's motion to close a mobile home park located in 
Peabody, Massachusetts (Green Meadows Mobile Home Village) and evict all the residents summarily 
within 30 days. Many of the Park's 41 homes are owned by elderly residents; many are low-income. It 
was alleged that the action violated the Manufactured Housing Communities Act because the receiver 
did not give residents two years notice of intent to close the park nor did the receiver offer to pay the 
residents the fair market value of their homes as required by G.L. c. 140, § 32L (7 A). Closure of the 



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Park on the terms proposed by the receiver would have resulted in an almost total loss of equity for the 
mobile homeowners in an amount in excess of $800,000. 

Several days of hearings were held, then suspended so that the parties could attempt to mediate 
the dispute. Mediation is ongoing. 

Comm. v. Peabody Rent Control Board 

In this action brought initially in Northeast Housing Court and transferred to Essex Superior 
Court, against nine mobile home parks and the Peabody Rent Control Board, CPAD concluded a 
three-day bench trial of its claim that eight parks violated c. 93A and the Manufactured Housing Act by 
issuing park discontinuance notices in bad faith. On the remainder of its complaint, the 
Commonwealth had previously won partial summary judgment invalidating the park discontinuance 
notices on other grounds and remanding the rent issues to the Peabody Rent Control Board for 
redetermination in accordance with applicable laws. To date, the Board has ordered rent decreases for 
two parks, held hearings on rents for four other parks, and is in the process of scheduling rent 
redetermination hearings for the remaining two parks. 

Comm. v. Pine Hill Estates 

In this action brought in Housing Court in Bristol County, against the owner and licensee of a 
400-plus mobile home park with primarily elderly residents for violations of the Manufactured 
Housing Communities Act and violations of Chapter 93A, partial summary judgment was entered for 
the Commonwealth. The court awarded civil penalties in the amount of $245,000, attorneys fees and 
restitution (in an as yet undetermined amount) for the owner's unfair practice of restricting the 
residents to one propane vendor and requiring residents to purchase the propane from that vendor 
through the park management at increased prices. The court found that the owner was charging a 
mark-up to consumers without providing any services. 



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Mobile Home Rules Reviews 

CPAD established its mobile home task force for the purpose of conducting review of park 
rules and addressing inquiries and complaints from consumers, park owners, and state legislators. 
During the past year, the Task Force has reviewed and issued reviews of the rules of many mobile 
home parks, and responded to numerous inquiries and complaints from around the state. Pursuant to 
CPAD's statutory obligation under G.L. c. 140, § 32L (5), the Division responded to numerous sets of 
park rules, objecting to rules which we determine are unenforceable because they violate the 
Manufactured Housing Communities Act or are "unreasonable," as set forth in § 32L of that Act. 

Massachusetts Manufactured Housing Commission 

G.L. c. 6, § 108, establishes the Massachusetts Manufactured Housing Commission, a 
deliberative body of representatives of tenants, owners, the Legislature, Executive Office of 
Communities and Development, and the Attorney General's Office which considers legislative 
proposals and mediates complaints between consumers and park owners. The Attorney General's 
"designee" attended monthly meetings of this agency as an ex -officio member of the Commission and 
provided information and guidance to this newly formed commission in 1995-1996 as they adopted 
by-laws, a mission statement and procedures to handle complaints and conduct their business pursuant 
to G.L. c. 6, §108. 

TICKET BROKERS 

Comm. v. Robert Anthony Finnemore, d/b/a State Line Tickets 

On May 2, 1996, CPAD filed a complaint in Hampden Superior Court against Robert Anthony 
Finnemore d/b/a State Line Tickets alleging unfair and deceptive acts or practices in connection with 
the offering for sale to the public concert tickets for two non-existent Pearl Jam concerts. 

On May 14, 1996, a preliminary injunction was issued enjoining the defendant's allegedly 
illegal conduct. 



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TOBACCO 
SKOAL/ U.S. Tobacco Sting 

This sting was designed to see if U.S.T. employed sufficient safeguards to prevent minors from 

receiving free samples of their product through the use of mail-in coupons, found in many 

Massachusetts convenience stores. From the 30 coupons that were sent in, 22 minors received samples 

of smokeless tobacco from U.S.T. On October 5, 1995, U.S.T. entered into an assurance of 

discontinuance requiring them to obtain proof of identification (in the form of a photocopy of a driver's 

license which would be verified through a computer database) before they would send any free samples 

by mail. In addition, U.S.T. agreed to pay $40,000 to the Attorney General's Local Consumer Aid 

Fund. 

Philip Morris Incorporated, R.J. Reynolds Tobacco Company, Brown & Williamson 
Tobacco Corporation, Lorillard Tobacco Company, Liggett Group Inc. v. Scott 
Harshbarger, Attorney General 

Five tobacco companies sued our office preemptively in federal court seeking a declaratory 

judgment on November 28, 1995. The Office filed a motion to dismiss that case, the outcome of 

which is still pending. 

Comm. of Massachusetts v. Philip Morris, Inc., R J. Reynolds Tobacco Company, Brown 
& Williamson Tobacco Corporation, B.A.T. Industries P.L.C., Lorillard Tobacco 
Company, Liggett Group, Inc., New England Wholesale Tobacco Co., Inc., Albert H. 
Notini & Sons, Inc., The Council for Tobacco Research -U.S.A., Inc., and The Tobacco 
Institute, Inc. 

This case was filed on December 19, 1995, in Middlesex Superior Court. In the case, the 

Commonwealth alleges that, through a concerted effort , the defendant cigarette companies have 

misled the public about the health effects and addictive nature of tobacco products. On January 3, 

1996, the defendants removed the case to Federal Court, and the Office moved to remand the case back 

to Middlesex Superior Court. After extensive briefing and oral argument by both sides, the Motion for 

Remand was granted in the Commonwealth's favor and the case was remanded back to Middlesex 



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Superior Court. Meanwhile, the Office has moved to have the federal Declaratory Judgment action 
dismissed. 

On March 15, 1996, the Office and the Attorneys General of four other states (Mississippi, 
Florida, West Virginia and Louisiana) entered into a settlement with defendant Liggett Group, Inc. (and 
various related entities). The settlement includes monetary payments to Massachusetts ($200,000 up 
front); Liggett's agreement to withdraw its opposition to the proposed FDA rule restricting tobacco 
industry marketing to children and to withdraw its related opposition to FDA's assertion of jurisdiction 
over cigarettes; various limitations on Liggett's future marketing to children; Liggett's agreement to 
cooperate in AG litigation against the rest of the tobacco industry; and obligations which would apply 
to any Future Affiliate (large tobacco company) with which Liggett joins. 

TRAVEL 

Comm. v. Journeys on Dialysis, Inc. and George Muir d/b/a Journeys on Dialysis. 

This case, filed in Norfolk Superior Court on July 14, 1995, involves a suit against a Cohasset 
travel agency and its principal for allegedly luring kidney failure patients by false offers of vacation 
cruises made possible by dialysis treatments aboard ship. The complaint alleges that the defendants 
violated the Consumer Protection Act by accepting money for vacation cruises and on-board dialysis 
treatment from consumers and then failing to provide either the travel accommodations or refunds. 
The complaint seeks injunctive relief, restitution to injured consumers and civil penalties. The court 
issued a temporary restraining order and subsequently, a preliminary injunction, prohibiting Journeys 
on Dialysis and Muir from accepting further payments for travel arrangement services. 

Commonwealth v. Anthony Belli d/b/a Centennial Travel and Tony's Casino Tours 

In September 11, 1995 CPAD obtained a permanent injunction against a tour operator 
prohibiting him from accepting funds from consumers and then failing to make transportation and hotel 
arrangements, and from failing to provide refunds to consumers. The injunction requires the defendant 



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to disclose financial resources and provide the Commonwealth with tax returns and a financial 
statement for a period of three years to determine if he is able to pay more than $40,000 in restitution 
and civil penalties. 

Comm. v. Resort Properties. Inc. d/b/a New Horizons of Wilmington, et al. 

On January 30, 1996, CPAD filed a complaint in Suffolk Superior Court alleging that Resort 
Properties, Inc., of Milford, Connecticut, violated the Massachusetts Consumer Protection Act by using 
deceptive solicitations to lure consumers to attend sales presentations at its showroom in 
Massachusetts. The company was doing business in Massachusetts as "New Horizons of Wilmington". 
The complaint also alleges that the company, as part of its high-pressure sales presentations, made false 
or misleading statements to induce consumers to purchase vacation club memberships costing 
thousands of dollars. 

The suit also alleges that Great American Records, doing business as G.A.R. Financial, engaged 
in unfair debt collection activities. G.A.R. Financial, an affiliated company, financed many of the sales 
transactions. 

UNAUTHORIZED PRACTICE 

Comm. v. Joe Chatelain 

On November 3, 1995, CPAD filed a complaint in Middlesex Superior Court, alleging that 
defendant Joe Chatelain was falsely holding himself out as an attorney; engaging in the unauthorized 
practice of immigration law; and filing false and fraudulent petitions with the Immigration and 
Naturalization Service without the knowledge or consent of the persons he supposedly represented. 
Default judgment was entered against the defendant on February 12, 1996, enjoining the defendant 
from engaging in unauthorized practice of law and requiring the payment of $6,900 in restitution to 
consumers, $5,000 in civil penalties and $100 in costs. 



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Comm. v. John F. Kennedy d/b/a .T.F.K. TV Repair 

On May 8, 1996, a complaint was filed in Suffolk Superior Court against John F. Kennedy 
d/b/a J.F.K. TV Repair. A Preliminary Injunction Order was granted May 30, 1996. The Attorney 
General alleges that defendant Kennedy, a TV repair technician doing business in Roslindale, violated 
the Massachusetts Consumer Protection Act by engaging in the business of television and radio repair 
after his license had been revoked by the state board of registration; charging consumers for repairs 
which had not been authorized by the customer; and refusing to return customers' televisions and 
radios. 

Commonwealth v. Fredy Pellecer 

On May 14, 1996, CPAD filed a civil action in Suffolk Superior Court against Fredy Pellecer, 

an East Boston man who allegedly misled immigrants seeking work permits and legal status to believe 

he was an immigration lawyer. A TRO and preliminary injunction were obtained prohibiting the 

defendant from engaging in the practice of law, representing that he is competent or qualified to 

practice law and from giving legal advice on immigration matters. 

OTHER INITIATIVES 

NAAG Consumer Education Fund Grant and Courses at the Madison Park Technical 
Vocational High School 

During this past school year, CPAD AAG's taught two consumer law classes per month at the 

Madison Park High School in Roxbury. The course covered the following topics: 1. Overview of the 

Attorney General's Office and Consumer Protection Division; 2. False and Misleading Advertising; 

3.Massachusetts Used Car Laws; 4. Credit and Credit Cards; 5. Telemarketing Scams and 

Sweepstakes; 6. Landlord/Tenant issues; 7. Buyer's rights; and 8. Consumer Mock trial. 



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The program produced a videotape on used car laws, and, along with the students, produced a 
brochure for high school students on consumer rights. These brochures were distributed to students at 
the Madison Park High School. 

The Attorney General's HMO Community Benefits Guidelines 

The Attorney General, in conjunction with health maintenance organizations in Massachusetts, 
released Community Benefits Guidelines that encourage HMOs to continue and to develop formal 
programs that promote preventive care and improve the health status and quality of life of the hundreds 
of thousands of citizens of the communities they serve, including the health care needs of unserved or 
underinsured citizens throughout Massachusetts. 

The voluntary guidelines, believed to be the first such effort in the United States, were 
developed in cooperation with the Massachusetts Association of HMOs ("MAHMO"), the state's 
largest health insurer Blue Cross and Blue Shield of Massachusetts, and community health care 
advocates. 

The guidelines are designed to be adopted and implemented by all HMOs, working with the 
communities they serve. For HMOs with community benefits programs, the guidelines serve to 
encourage their continued public commitment to disadvantaged patients, particularly the working poor, 
poor children, victims of domestic violence, elderly with low- or moderate-incomes, minorities, and the 
disabled. The guidelines also encourage HMOs that are part of an integrated health care system to 
develop a community benefits program in collaboration with system partners. 

Attorney General's Manufactured Housing Regulations 

In December, 1995, CPAD chaired hearings on proposed manufactured housing regulations. 
The regulations are intended to address consumer protection issues involving terms and conditions of 
occupancy, the promulgation of community rules by manufactured housing community owners, the 
provision of goods and services within manufactured housing communities, the purchase and sale of 



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manufactured housing within these communities, the termination of tenancies and eviction, the sale or 
lease of entire manufactured housing communities by the owners of those communities, and other 
related issues. 

Over 800 sets of written comments were submitted on the proposed regulations and 300-400 
individuals attended the hearings. It is expected that the final regulations will be promulgated in 
August, 1996. 

Attorney General's Travel Regulations 

In April, 1996 the Office issued a set of regulations to deal with common problems in the 
purchase of travel services. The regulations emphasize complete, accurate, prior disclosure of 
information about travel services offered for sale; give the consumer significant rights to cancel or 
receive a refund; and draw clear lines of accountability for travel plans that fall through, because of 
some failure on the part of the seller of travel services. The regulations are found at 940 CMR 15.00 et 
seq. 

Attorney General Harshbarger's Consumer University 

Approximately 1 ,000 elder consumers from across the Commonwealth attended three 
"Consumer University" conferences in May, 1996. The conferences, held in conjunction with national 
Older Americans Month featured seminars on knowing your consumer rights, health care, and elder 
protection issues. Speakers included Assistant Attorneys General from the Public Protection Bureau, 
Regulated Industries Division, Elder Protection Project, Western Massachusetts Office, local police 
departments and the American Association of Retired Persons. 

LOCAL CONSUMER AID PROGRAMS 

The Local Consumer Aid Programs, along with the Face-to-Face Mediation Services, are 
responsible for the administration of the Local Consumer Aid Fund (LCAF). The LCAF supports the 
state-wide network of nineteen Local Consumer Programs and eight Face-to-Face Mediation Programs 



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through annual grants for the resolution of consumer problems. The Local Consumer Program 
Coordinator provides continuing training and technical assistance to grant recipients. The LCPs, 
working in cooperation with the Office of the Attorney General, resolve thousands of complaints each 
year, and also identify patterns of unfair and deceptive acts and practices in the marketplace. 

Funding for the local programs is allocated by the General Court pursuant to G.L. c. 12 § 1 1G. 
For fiscal year 1996, $598,499 was appropriated by the legislature to the LCAF. Ten percent of that 
figure ($59,849) was retained by the Office of the Attorney General for administrative purposes. An 
additional sum, which was earmarked for the LCAF from settlements of consumer cases, was used to 
supplement the legislative appropriation, for total costs of running the programs in 1996 of $913,050. 

In the first six months of 1996, the nineteen local consumer programs handled approximately 
6,000 written consumer complaints, recovering over $1,500,000 for consumers in the Commonwealth. 
The percentage of written complaints resolved is nearly 80%. 

In addition to its consumer complaint resolutions, the Mediation Services program had 
continued to implement its school-based mediation project, Student Conflict Resolution Experts 
(SCORE). 



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CONSUMER COMPLAINT AND INFORMATION SECTION 

The Attorney General's Consumer Complaint and Information Section (CCIS) provides 
services to individual consumers by responding to thousands of requests for information on consumer 
issues and referrals on the Attorney General's consumer "hotline"; through a voluntary mediation 
program resolving consumer complaints against merchants and businesses which recovers refunds and 
other savings for individual consumers; by educating the public through developing and distributing 
educational materials and by participating in community consumer education initiatives; by responding 
to public records requests; and identifying potential trends of unfair or deceptive trade practices for 
further investigation or possible prosecution by the Consumer Protection and Antitrust Division. 

For the period July 1, 1995, through June 31, 1996, CCIS received and responded to 18,300 
complaints or other correspondence; responded to 1 26,356 telephone calls to the Attorney 
General's consumer hotline; and mediated 2,644 consumer complaints recovering $459,637 in 
refunds or other value to consumers. 

CCIS' major initiative over fiscal year 1996 is the development and implementation of the 
computer tracking system, the Consumer Complaint Tracking System ("CCTS"). CCTS is currently 
used to capture consumer and merchant information received on the hotline. The system automatically 
generates a complaint form and a cover letter once the consumer's identifying information is entered. 
The computer generated forms are time saving, and list a specific complaint number which is used in 
the future to access the consumer's information. In addition, CCTS allows the user to access 
information more efficiently by listing federal and state agencies and local consumer program phone 
numbers, as well as the status of cases. Also, in responding to public records requests, information on 
the number of complaints filed against a particular merchant with a breakdown by location can be very 
quickly accessed. 



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CCTS allows the Complaint Section to respond more efficiently to consumer inquiries on the 
hotline; allows staff to quickly enter consumer or merchant data; enables staff to quickly and easily 
retrieve complaint records filed against a particular business; allows staff to research complaints 
involving particular industries to identify patterns or trends of unfair or deceptive practices. CCTS will 
be installed in the nineteen (19) local consumer programs. Once the local consumer programs are 
linked, data from the individual programs will be downloaded directly to the Attorney General's 
database on a daily basis, thereby insuring the integrity of the information provided to the public and 
the press concerning the number of complaints on file against a particular business. 

As of February, 1996, complaint forms and correspondence are scanned into the database, so 
that the actual image of the complaint appears on the computer screen. Therefore, when responding to 
public records requests for copies of consumer complaints, the scanned complaint is retrieved and the 
consumer's identifying information is redacted on the screen. This process greatly reduces the response 
time for such requests. The consumer educational brochures and materials distributed to the public 
will also be scanned into the database for use on the hotline in answering inquiries. 

As of March, 1996, significant progress was made in implementing additional functions and 
screens of the tracking system. Staff now record mediation notes and actions on the Status and Event 
Information screen,; staff utilize the Bulletin Board screen on the hotline to search and view referral 
information by entering key words; the Case Information screen is being implemented which provides 
litigation/investigation information and links complaints to a particular case; press releases are 
electronically transmitted from the Press Office and are read when staff log on to the system; and the 
Look Up Complaint screen is used to determine the number of complaints, business and complaint 
type, mediation location, and the disposition of the complaints against a particular business. 

Investigators and other Public Protection Bureau staff were trained and CCTS installed on 
their computers to facilitate wider use of the tracking system and to support investigations and 



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litigation. Management Reports which track complaint data for a specific period of time (monthly, 

quarterly, etc.) are now run from CCTS. The reports are comprehensive and contain information, such 

as the number of referrals to local consumer programs and state or federal agencies, the number of 

complaints by business and complaint type, the total amount of complaints mediated and money 

recovered for consumers, and the three merchants with the 

highest number of complaints. 

In addition to operating the hotline, mediating complaints and implementing the computer 

tracking system project, the Section provided intensive support to the Freedom House local consumer 

program located in Roxbury. Freedom House experienced significant staffing and management 

difficulties which resulted in the transfer of open and backlogged complaints to the Section. In 

addition to maintaining their own caseloads, staff trained and supported new Freedom House staff 

members, and mediated 237 Freedom House consumer complaints recovering $20, 856 for consumers 

living in the inner city . 

The Section focused on consumer education initiatives; in cooperation with the MBTA and 

Fleet Center, in recognition of National Consumers Week, staff distributed consumer educational 

materials and complaint forms and answered questions at the Fleet Center; staff attended the MA 

Council on Aging conference and distributed education material and complaint forms to elder care 

providers; following the Marston Mills factory fire in Lawrence, staff participated in a community aid 

initiative; and staff participated in the Attorney General's Consumer University programs providing 

complaint forms, education materials and answering the questions of senior citizens. The Section 

increased the number of interns participating in the undergraduate mediation internship program. Due 

to the increase, the complaint assignment process was expedited, thereby decreasing the waiting period 

for consumers. Lastly, CCIS staff continued to participate in the following Bureau and Office-wide 



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initiatives: the Internet working group, NAAG telemarketing group, and the SJC Racial and Ethnic 
Bias Committee. 

MEDIATION SERVICES DEPARTMENT 

The OAG Mediation Services Department consists of 6 staff members: Director, Deputy 
Director, Administrative Assistant and 3 Regional Coordinators. The three Regional Coordinators 
provide coverage to SCORE and Face to Face Mediation Programs in the Northeast, Central & Boston 
and Western MA regions. The Southeast region is not served by a Regional Coordinator at this time so 
coverage for these programs is provided by the Director and Deputy Director. 

There are three major components to the work of the OAG Mediation Services Department 
(MSD), Face to Face Mediation Programs (FTFMP), SCORE (Student Conflict Resolution Experts) 
and the Conflict Intervention Team (CIT). 

Face to Face Mediation Programs 

Face to Face Mediation Programs were created by the OAG to provide consumers and tenants 
with face-to-face mediation services to resolve consumer/merchant and landlord/tenant complaints. 
The FTFMP was initiated in 1984 by the OAG with 3 pilot programs in Worcester, Haverhill and 
Somerville. There are now 8 Face to Face Mediation Programs serving citizens in Worcester, 
Haverhill, Somerville, Brockton, Hyannis, Fitchburg, Springfield and Lowell. During FY 96, with 
the assistance of trained volunteer community mediators these programs conducted 1 ,755 mediations 
with 74% of these disputes reaching a mediated resolution. Face to Face Mediation Programs receive 
referrals from local consumer programs, local courts, police and other community agencies. 

OAG Face to Face Mediation Programs are part of a statewide network of 30 community 
mediation programs. These community based programs require volunteer mediators to undergo 30 
hours of basic mediation skills training. Upon successful completion of basic mediation training, 
community mediators volunteer their time and their mediation skills to help serve their community. 



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Face to Face Mediation Programs receive technical support, consultation, and training 
assistance from MSD. In addition to program quality control services, MSD also administers the 
FTFMP grants, evaluates program performance and collects program statistics and financial reports. 

Student Conflict Resolution Experts 

SCORE is a comprehensive peer mediation program that forges a partnership between 
educators and mediators to establish quality student-centered mediation programs in schools. Since 
SCORE'S inception in 1990, it has implemented 35 peer mediation programs in schools across 
Massachusetts. Eight new SCORE programs in Holyoke, Amherst, Plymouth, Wakefield and 
Springfield were implemented in FY 96 bringing the total number of SCORE programs to 27 schools 
in 18 communities throughout Massachusetts. From September 1995 through June 1996, SCORE 
programs mediated 2,004 peer disputes with 97% reaching a mediated resolution. 

SCORE funds a program model that requires a full or part-time adult SCORE coordinator in 
the school. The SCORE coordinator is hired and supervised by the SCORE grant recipient (a local 
community mediation program). SCORE mediators are recruited from the student body and undergo 
an intensive 20 hr. SCORE peer mediation training to prepare them to serve as a peer mediator at then- 
school. In SCORE programs, the student mediators conduct the majority of mediations with support 
and guidance from the SCORE coordinator. 

The Conflict Intervention Team (CIT) 

The CIT is a team of experienced community mediators ready to mobilize at a moments notice 
and respond to a school in crisis or on the verge of crisis. Last year, schools in Granby, Lynn and 
Pittsfield requested mediation intervention from the Conflict Intervention Team. CIT also provided 
technical assistance to 1 school in Manchester, NH and conducted assessments for schools in 
Marblehead, Fitchburg and Holyoke. In each school, CIT was faced with tense situations that were 
based in the intolerance of differences and threatened to build to crisis proportions. CIT mediators 



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facilitated small and large group discussions to ease tensions and conducted 10 mediations with 100% 
reaching a mediated agreement. Five MSD staff members and 16 CIT mediators served on CIT in FY 
96. 

Annual Site Visits 

SCORE conducts an Annual Site Visit/Program Evaluation for each SCORE program. These 
site visits provide MSD with an opportunity to evaluate individual program performance, generate 
improvements, troubleshoot problems and determine program priorities for the new school year. MSD 
incorporates the information gained from these visits into strategic program planning for the new 
school year. During academic 95'-96' MSD staff conducted 27 site visits and met with school 
principals, disciplinarians, student mediators, score coordinators and community program directors. 

95'-96' Trainings 

Last year MSD conducted 13 SCORE trainings and trained 301 student mediators for the 
following SCORE schools: 

Springfield: Central High School, Putnam Voc.Tech. High School 
Lynn: Lynn Classical High School 

Haverhill: Haverhill High School 
Holyoke: Holyoke High School 

Amherst: Amherst Regional Jr. High School 

Plymouth: Plymouth Community Intermediate School, Plymouth 

North High School and Plymouth South High School 
Wakefield: NE Metro Technical High School 
Boston: Boston English High School, Curley Middle School 
Cleveland Middle School 



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SCORE peer mediation trainings are high energy, experiential, intensive and interactive 
learning events. Trainings last 18-20 hours and are conducted by experienced mediation trainers and 
school mediators. The heart and soul of a SCORE training is the mediation role-play. SCORE 
believes that giving students an opportunity to learn and practice mediation skills in a role-play setting 
is the most effective way to teach mediation skills and help student mediators to develop confidence in 
their new abilities. 

Program Support Activities 

In addition to annual site visits and program evaluations, MSD provides mediation 
experience, technical support, case review and training assistance to the FTFMP, SCORE and CIT 
programs. The on-going support services provided by MSD Regional Coordinators maintains the high 
quality of training for new mediators and preserves the integrity of the Mediation practiced in these 
programs. 

Regional Coordinator Reports 

For a more detailed report of program activities by region, please refer to the attached 
Regional Annual Report. These reports were written by MSD Regional Coordinators, Sandra 
Washburn (Northeast), Jill Roberts (Western MA ) and Susie Wong (Central & Boston). 
Innovations 

In 1994 OAG won a prestigious national award from the Ford Foundation for its SCORE and 
CIT programs. The $100,000 award was given following a national competition to seek creative 
programs which provide valuable services to the public. The $100,000 award is used to disseminate 
information nationally about SCORE and CIT and, to encourage replication of these programs by 
other Attorneys General and State Departments of Education. During FY 96, MSD responded to 
over 100 requests for information and mailed out 73 in-state and 40 out-of-state SCORE and CIT 
information packets. 



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Kathleen Grant, Director of MSD, visited AG offices in Louisiana, New York and South 
Carolina to provide orientation workshops to the SCORE program. This fall, MSD will return to 
Louisiana to provide SCORE replication training. Last April, at the request of the Indiana AG's Office, 
Kathleen Grant and Darlene Skog, MSD Deputy Director, traveled to Fort Wayne, Indiana to provide 
advanced mediation training and technical assistance to the 6 middle and high schools in Fort Wayne. 
An intensive 2 1/2 day advanced mediation skills training was provided to Fort Wayne peer mediation 
coordinators, local community mediators and school administrators. 

MSD consulted with states interested in replicating SCORE and/or CrT in North Carolina, 
Nevada and Arizona. As a result of these consultations, Kathleen Grant will be traveling to Arizona 
this fall to provide a SCORE orientation workshop and to North Carolina to deliver a CJT replication 
training. 

Community Outreach Projects 

Community outreach projects in FY 96 brought MSD staff to communities in Lynn and 
Boston. In Lynn, Kathleen Grant and Susie Wong, MSD Regional Coordinator worked with the Lynn 
Youth Violence Prevention Collaborative and provided mediation consultation to ease mounting 
tensions among members of feuding Asian and Hispanic gang-involved youth. As a result of these 
efforts, the tensions between the two groups have moderated. In Boston, Kathleen Grant, working in 
collaboration with other trainers, designed an innovative 5 day mediation skills training to teach street 
workers in the Boston Street Smarts program how to use mediation skills to prevent and deter youth 
violence on the streets. 

MSD also joined a Prejudice-Based Violence Reduction Working Group sponsored by the 
Dept. of Justice. Working group members include federal and state agencies and local community 
organizations working to reduce prejudice-based violence. The working group's primary purpose is to 
produce and disseminate a comprehensive resource book. 



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Public Events, Presentations, Workshops 

During the year, MSD staff participated in 7 public events and represented the OAG in 
Holyoke at a legislative breakfast, in Worcester at a Race Relations Roundtable, at graduation 
ceremonies for volunteer mediators in Hyannis and peer mediators in Grafton, in Maiden on cable 
television, at a statewide peer helpers conference in Framingham and in Boston at a celebratory dinner 
for UMass Certificate Program in Dispute Resolution graduates. In addition to these public events, 3 
presentations on MSD mediation programs were given by staff at Suffolk Law School, Dept. of Justice 
Prejudice-based Violence Reduction Working Group and the OAG complaint section. 

MSD staff conducted 21 mediation skill-building workshops at the following conferences: 
OAG's, " SCORE , " Civil Rights in our Schools" and "Juvenile Police Officers Training , " Essex DA's, 
"Hate Crimes" , Society for Professionals in Dispute Resolution , Mass. Assoc. Mediation Programs and 
Practitioners , National Assoc, for Mediation in Education , Mass. Non-Profit Housing Assoc , and 
Mass. Continuing Legal Education "Mediation in the Global Village" . Mediation skill building 
workshops were also conducted at Regis College, UMass and Harvard University by MSD staff. 

In FY 96, the Attorney General visited SCORE and peer mediation programs in Springfield 
twice and the SCORE program in Lowell once. MSD staff helped to coordinate each visit by the 
Attorney General. 

Troubleshooting: Existing SCORE Programs 

In FY 96, MSD was faced with an unprecedented number of serious and complex issues 
which presented challenges to existing SCORE programs in Springfield, Taunton, Dartmouth, Lynn, 
Fitchburg and Medford. In each case, MSD's response was to conduct a carefully planned and 
orchestrated mediation intervention. MSD's goal was to resolve these issues without compromising the 
guiding principles of the SCORE program or the OAG's commitment to preventing violence in our 
schools. 



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Springfield 

Darlene Skog, with assistance from Jill Roberts (Western MA Regional Coordinator), 
facilitated a series of on-going meetings with Springfield School Dept.(SSD) staff and New North 
Citizen's Council (NNCC), the SCORE grant recipient, to find a mutually agreeable resolution to the 
problems created by the hiring of two Mediation Teachers for schools in Springfield already served by 
SCORE programs. Since the primary responsibilities of the Mediation Teacher exactly duplicated that 
of the SCORE Coordinator, MSD took preventative action and initiated a dialogue with SSD and 
NNCC to solve the problems created by the Mediation Teachers' hiring. 

Throughout the series of meetings, discussions and negotiations held in Springfield, MSD's 
goals were 1) to prevent negative impact to the existing SCORE programs, 2) to design a plan that 
would support a cooperative working relationship in the schools, and 3) to keep the lines of 
communication open so that all parties could work together in the best interests of the students. 

After several rounds of meetings and discussions with SSD and NNCC and a meeting with 
Springfield superintendent, Dr. Peter Negroni, a proposal was drafted by SSD and NNCC for MSD 
review. The joint proposal adopted each suggestion offered by MSD during the series of meetings. A 
draft of this proposal for the upcoming 96-97' school year is now under review by MSD. 

Although we were pleased at the progress made on this issue, we fully anticipate that the 
upcoming 96'-97' school year in Springfield will at best be a difficult and trying one for SCORE. 
Taunton and Dartmouth 

Last winter, with no forewarning, Taunton and Dartmouth High Schools requested that 
SCORE grants for the 96- 97' school year be given directly to the schools instead of ComCare, the 
SCORE grant recipient. Both schools argued that they no longer needed supervision from ComCare, 
that they had the capacity to administer the SCORE grant and that their administration of the SCORE 
grant would save money. 



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Kathleen Grant and Darlene Skog met individually with the schools to learn more about the 
basis for their request. At these meetings, we heard from each school about their discomfort with the 
level of administrative costs, the salary schedule of the score coordinator and their diminished need for 
ComCare's program supervision. After carefully listening to their concerns, we encouraged each 
school to consider a range of possible solutions. We shared our past experiences with the model they 
were proposing and described the difficulties we encountered in applying that model. We also learned 
during these meetings that neither school had brought these concerns to ComCare's attention and that 
ComCare was unaware of their request to us. We strongly urged each school to immediately 
communicate their concerns to ComCare and they agreed to do so. 

Once the schools had communicated their concerns to ComCare, we met with ComCare to 
review the school's issues and hear ComCare's point of view. During the meeting with ComCare, we 
encouraged them to prepare carefully for these potentially difficult meetings. 

As a result our efforts to stimulate communication on the local level, all parties took part in a 
constructive dialogue that helped them to resolve each other's concerns. In the end, both of the schools 
agreed to continue their working relationship and ComCare agreed make necessary adjustments to 
budget and supervision plans. We plan to carefully monitor the situation throughout the 96'-97' school 
year to ensure no new difficulties arise. 
Medford 

During the annual site visit with Principal Tadaro and Superintendent Bellson, Sandra 
Washburn, MSD Regional Coordinator, and Alice Comack, Director of Somerville Mediation Program 
(SMP), the SCORE grant recipient, were informed that there would be no school funding for the 
SCORE program at Medford HS in the new school year. Sandra and Alice responded to this troubling 
news by discussing with the principal and superintendent the impact to the school of not funding the 
SCORE program and further explained that the SCORE grant program required matching funds. 



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Over the summer, after many discussions with Sandra Washburn and Alice Comack, the 
school under pressure from the minority community, finally agreed to keep SCORE at Medford HS but 
did not offer matching funds. Acting independently of SMP (the hiring authority), the school decided 
to staff SCORE with a minority guidance counselor who lost her job at the school due to budget cuts. 
The school perceived this as a way to solve their budget problems and meet the requirement for the 
SCORE grant. Recognizing that school's action had put further strain on its working relationship with 
SMP, Sandra intervened and contacted the principal to discuss the situation and our concerns about 
changing the SCORE model. Sandra let the principal know we felt strongly that SMP needed to stay 
involved in Medford HS to ensure the continued success of the SCORE program. 

After much prompting and behind the scenes facilitation by Sandra and Alice, the school and 
SMP are discussing budget and staffing concerns. The end result of all of these efforts is as yet to be 
determined. 
Lynn 

This spring, Nick Kostan, the principal at Lynn Classical HS, contacted MSD to express his 
growing concerns about the Lynn Youth Resource Bureau (LYRB), the SCORE grant recipient. 
Principal Kostan felt that LYRB provided minimal support to the score coordinator, used too much of 
the grant money for unnecessary administrative expenses, and paid the score coordinator too little. 

Much like the behind the scenes work done in Taunton and Dartmouth, Sandra Washburn and 
Kathleen Grant worked to lay a groundwork to support and improve communications between the 
school principal and LYRB. They facilitated meetings and conducted follow-up discussions with the 
school and LYRB. As a result of these efforts, the school and LYRB have worked out their differences 
and will continue with their working relationship at least for the 96'- 97' school year. MSD intends to 
carefully monitor this situation throughout the new school year. 



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FUchburg 

Near the end of the school year, Susie Wong, MSD Regional Coordinator, was informed by 
North Central Court Services (NCCS), (the SCORE grant recipient) that it had restructured the salary 
schedule for the score coordinator position for the 96'-97' school year. NCCS also alerted Susie that 
they expected the new salary range to be unsatisfactory to the existing score coordinator. 

Over the summer, the principal learned of the salary issue and offered to find additional 
school funds to resolve the salary dispute because he wanted the score coordinator to return. MSD was 
informed that the principal expected to add non-SCORE duties to the score coordinator's work and was 
asked to comment. Susie advised NCCS that we were not likely to support this alteration of the 
SCORE model due to our past negative experiences with this change in the model. 

MSD has been monitoring the parties' discussions throughout the summer and working behind 
the scenes to stimulate communication and problem-solving on the local level. At this point, it looks 
as if the parties are about to finalize their discussions. MSD plans to continue to monitor this situation 
and respond as necessary. 
Comments 

One powerful lesson we have learned from our experiences this year is that program maturity 
brings with it new demands for independence. As the SCORE programs mature, the needs of the 
schools and the score coordinators change and evolve. To effectively manage these natural changes 
and advancements, adjustments on the part of MSD as well as the SCORE grant recipients, are and will 
be necessary to maintain quality student-centered SCORE programs in the schools. 

MSD held 2 half-day meetings with the CMP's (SCORE grant recipients) to share our 
perspective on the changing needs of mature SCORE programs. MSD wanted to encourage the CMP's 
to prepare to face similar challenges. Both of the meetings with the CMP's were successful. The 



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CMP's left these meetings with a new and deeper understanding of the responsibility they have to help 
sustain a strong partnership with the schools. 

Following these meetings, MSD initiated the several administrative improvements to the 
SCORE program for the 96'-97' school year. The improvements included 1 ) a redesign of the format 
for SCORE Letter of Intent, 2) a revised budget form, 3) submission of a detailed supervision plan and, 
4) a requirement that individual schools review and sign off the SCORE Letter of Intent - 
Troubleshooting; New SCORE Programs 
Amherst 

At Amherst Regional Jr High School, we were faced with the challenge of implementing a 
SCORE program in a school that had a teacher-run peer mediation program prior to SCORE. 
Throughout the year, Jill Roberts, Western MA Regional Coordinator and the CMP (Hampshire Youth 
2000) worked to integrate the SCORE program into the school. The school subtly resisted the efforts 
to integrate the SCORE program into their existing peer program. In May, the CMP was informed by 
the school that they would not continue with SCORE next year. The official reason given was a lack of 
matching funds (the CMP had provided the bulk of the match in the first year). The school indicated 
that it would continue with the teacher-based peer program that was in place prior to SCORE. 

Although the school offered funding as the reason for withdrawing from SCORE, we suspect 
that the school's commitment to a teacher run, adult-centered peer program was preferred over 
SCORE'S student-centered model. 
Plymouth 

Following a successful CIT in the spring of 95' at Plymouth South High School, SCORE 
agreed to fund a pilot "circuit rider" model for three Plymouth schools: 2 high schools and 1 middle 
school. In this model, each of the 3 schools would provide an in-house staff person to coordinate 
SCORE. The CMP Director, Jean Fawcett of Community Mediation Services, would train each score 



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coordinator and follow a rotating schedule to start-up a SCORE program at each school. Since MSD 
has no Regional Coordinator for the Southeastern area, Darlene Skog worked with the CMP in the 3 
Plymouth schools. 

In this pilot model, after one SCORE program was up and running, the CMP would advance 
to the next school and repeat the program start-up cycle. Throughout all stages of program 
development, the score coordinators would receive on-going program supervision from the CMP, a 
former SCORE coordinator. 

In September, Plymouth South High School (PSHS) was the first school to start-up a SCORE 
program. The school psychologist was selected to be the in-house score coordinator. In February, 
Plymouth North High School (PNHS) started its SCORE program with a school counselor serving as 
the temporary score coordinator. In April, Plymouth Community Intermediate School (PCIS) started 
its SCORE program with two school counselors coordinating the program. 

In each of the 3 schools, the CMP encountered delays in program implementation. As a 
result of the delays, the CMP did not have enough time to introduce the SCORE program to each 
school and build inside support for peer mediation. Continual interference by the school liaison, 
combined with her unwillingness to allow the CMP to work within the schools as contracted, created 
many start-up problems for the CMP. To overcome these delays and obstacles in SCORE program 
start-up, the CMP had to meet with the school liaison and re-negotiate the program start-up and 
training cycles for each school. 

Once the first phase of program start-up was completed, we had high hopes that things would 
begin to normalize and run more smoothly in each school. Unfortunately, we encountered further 
problems and difficulties. In PSHS, the CMP faced strong resistance to on-going program supervision, 
in PNHS, the school did not provide a score coordinator (a temporary coordinator was eventually 
found) and in PCIS, we were faced with a resistant principal. All of our efforts to address these 



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problems on a school by school basis were unproductive. As a last resort, we sought the assistance of 
the school liaison. Instead of using her influence to help us resolve these problems, she argued against 
the importance of following the SCORE program guidelines and reinforced the poor mediation 
practices and policies that we were seeking to improve. 

Due to the roadblocks that we encountered at each turn in Plymouth, we were never quite sure 
that the Plymouth schools wanted SCORE - notwithstanding the school liaison's comments to the 
contrary. In June, Darlene conducted annual site visits at all three schools meeting with the principals, 
the in-house coordinators, the CMP and the school liaison, Mary Connolly. While the principals and 
the in-house coordinators (who had complained from the outset about their heavy work-loads) seemed 
to be satisfied with the slow pace and progress of SCORE, Darlene learned that the CMP and the 
school liaison did not want to continue their relationship into the new school year. The school liaison 
informed Darlene that she was not certain of her commitment to a SCORE program, that she believed 
that she could provide peer mediation training herself and that she was not at all certain that she could 
provide the required matching funds, assuming she decided to stay with SCORE. MSD learned over 
the summer that the school liaison decided to withdraw from SCORE. 

We learned a some important lessons from our experiences in Amherst and Plymouth. First 
and foremost, the school must want SCORE and be willing to accept the program model for it to be 
successful. Secondly, we feel even more certain about the inherent wisdom in resisting substitutions of 
in-school staff for the outside score coordinator. After many sincere but failed attempts to make this 
substitution work to our satisfaction, we feel the case has been proven against further experiments of 
this nature. As we have witnessed time and time again, there is no substitute for the outside SCORE 
Coordinator who really believes in quality peer mediation . 



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PUBLIC CHARITIES DIVISION 

The Attorney General represents the public interest in the proper solicitation and use of charitable 
funds and is authorized to "enforce the due application of funds given or appropriated to public 
charities within the commonwealth and prevent breaches of trust in the administration thereof." G.L. 
c.12, sec. 8. The Division of Public Charities was established to carry out the Attorney General's 
responsibilities in this area. 

More than 35,178 charities are registered with the Division, as well as 213 fundraisers 
presently operating on behalf of charities in Massachusetts. A public charity is one which is non-profit, 
whose purpose is charitable and which benefits a portion of the public; in addition to philanthropic 
organizations, examples of public charities include nonprofit hospitals, schools, social service 
providers, and cultural organizations. As well as registering and obtaining financial reporting by 
charities and fundraisers, the Attorney General is the defendant in all proceedings brought in the 
Supreme Judicial Court to wind up the affairs of a public charity. 

Beyond enforcement of laws requiring annual reporting by public charities operating in the 
Commonwealth, the Division focused its activities during the last fiscal year in three primary areas: 
enforcement litigation to address deception and fraud in charitable fundraising; estate and trust actions 
to ensure charitable trust funds are appropriately administered and applied; and corporate governance 
and oversight initiatives to ensure charitable governing boards are carrying out their fiduciary duties of 
due care and loyalty. 

Recognizing that charities provide vital services in our communities, enjoy certain benefits 
due to their tax-exempt status, and assume certain obligations as a result of these benefits, the Division 
has been involved in a number of initiatives over the past year intended to strengthen the charitable 
sector at large. These efforts have included the Division's annual report on charitable fundraising, 
published during the Fall giving season; the Attorney General's Fourth Annual Conference for Board 



219 



Members, which was held in April and attended by over 408 volunteer directors and others; and 
establishment of procedures for review of proposed acquisitions of nonprofit health care providers by 
for-profit companies. 

SOLICITATION OF CHARITABLE FUNDS 

The Attorney General takes affirmative legal action against charities and professional 
fundraisers for unfair or deceptive solicitation practices and to enforce their fiduciary duties with 
respect to funds raised. In addition to injunctive relief, he may seek restitution of funds intended by the 
public to benefit a specific charity, or particular charitable purpose, along with penalties and fees. 

Following are examples of deceptive charitable solicitation cases in which the Division was 
involved in the last fiscal year: 

Commonwealth v. M & M Advertising Associates and Hugh Mayer 

In July, the Attorney General obtained a consent judgment permanently enjoining the 
professional fundraiser from engaging in deceptive fundraising practices. The deceptive practices 
included falsely leading potential donors to believe that money raised would support local high school 
athletic programs and local senior centers. The court awarded $17 thousand dollars to the Attorney 
General's Local Consumer Aid Fund. 

Commonwealth v. Elite Systems, Robert Betti, Jeffrey A. Young, Howard M. Kustanovitz 

In October, the Attorney General obtained a consent judgment and permanent ban against the 
professional fundraiser. The Attorney General's lawsuit alleged that the fundraisers deceived donors to 
believe that they were state or local officials and that contributions would be used for local school drug 
and alcohol awareness programs and fire prevention. 

The solicitor was ordered to pay $125,000 to the Attorney General's Local Consumer Aid 
Fund. 



220 



Commonwealth v. Sean OLeary 

In November, the Division obtained a consent judgment permanendy banning the professional 
fundraiser from conducting charitable solicitation or controlling a charity in Massachusetts as a result 
of his involvement in the National Awareness Foundation's "Hugs Not Drugs" solicitation campaign. 

Commonwealth v. RD Marketing 

In February, the Attorney General obtained a consent judgment permanendy banning the 

professional fundraiser from engaging in deceptive fundraising after it allegedly used deceptive 

practices while conducting a campaign on behalf of California's American Veterans Assistance 

Corporation. The solicitor was ordered to pay $10,000 to the Attorney General's Local Consumer Aid 

Fund. 

Commonwealth v. Civic Development Group, Police Activities League of the Bavstate and 
Fraternal Order of Police Massachusetts State Lodge 

In March, the Division obtained a consent judgment permanently barring the use of deceptive 
fundraising practices by the New Jersey solicitor. The Attorney General's suit alleged that the 
fundraiser falsely led donors to believe that funds raised would be used to support police departments 
and communities where donors lived. Additionally, some donors were led to believe the caller was a 
police officer and that they would receive preferential police treatment in return for making a donation. 

The court ordered the solicitor to pay the state $50,000. Additionally, both client 
organizations were ordered to pay $5,000 each. 

Commonwealth v. Bavstate Benefits, Todd Rampe, America's Missing Children 

In May, the Division obtained a consent judgment permanently banning Baystate Benefits and 
Todd Rampe from engaging in charitable fundraising in Massachusetts. The action was initiated by a 
complaint filed last year in which the Attorney General alleged that telemarketers working for Baystate 



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Benefits falsely led donors to believe that they were volunteers or employees of the Florida based 
charity America's Missing Children. 

In addition to the ban, Todd Rampe was required to perform forty hours of community 
service. 

ESTATES AND TRUSTS 

In furtherance of his authority to "enforce the due application" of charitable trust funds and to 
"prevent breaches of trust in the administration thereof," the Attorney General is an interested party in 
the probate of all estates in which there is a charitable interest and in all other judicial proceedings 
affecting charitable trusts. Accordingly, the Division continued to handle a large volume of cases in 
this area involving such matters as proposed allowance of accounts, will compromises, sale of real 
estate, change of purposes or beneficiaries of charitable trusts and bequests, amendment of charitable 
trusts to meet IRS requirements, and termination of charitable trusts under G.L. c.203, § 25. For 
example: 

In re: Trust u/w Lloyd G. Balfour 

Article Fifth of the Will of Lloyd G. Balfour establishes a permanent fund for public charity 
known as the "L. G. Balfour Foundation". After negotiation with the Division, the Trustee of the 
Foundation filed with the Bristol County Probate Court a petition for approval of a settlement of 
certain potential environmental claims against the Trust in connection with the sale by the Trust of 
certain assets bequeathed to the Trust by the Donor. The Division assented to the petition and has 
caused a copy of the Judgment entered to be filed in the Trust's public file in the Division. 

Town of Hamilton v. Attorney General 

The Town's complaint sought permission to use the building as a library, to be developed 
jointly with the neighboring Town of Wenham, pursuant to a new state program encouraging joint 
libraries. Certain real property had been deeded to the Town in 1920 by Frederic W. Winthrop, to be 



222 



used originally as a schoolhouse, playground or park. Continued school use had become impracticable; 
playground use of the grounds was possible and would continue. After review and negotiation, the 
Division assented to the Town's complaint filed with the Essex County Probate Court. 

John K. Spring, et als., Trustees of the Hervey A. Hanscom Trust v. Nasson College, et als. 

The residue of the Hanscom Trust was to be accumulated for twenty-five years and then 
distributed to Nasson College as an endowment for its general purposes. Prior to the Trust's 
termination, Nasson College went bankrupt and lost degree-granting authority. The Middlesex County 
Probate Court ruled, in response to the Trustees' request for instructions, that the specific gift failed. 
On Motion of the Attorney General, the Court further ruled that the doctrine of cy pres applied to the 
gift. In subsequent proceedings, after review of submissions by interveners seeking to be awarded the 
Trust and memoranda of law submitted by the Attorney General, the Court ruled on September 27, 
1995 that distribution of the $2 million Trust to the University of Maine system to be used primarily for 
scholarships in the liberal arts would conform to the Donor's intent as nearly as possible. 

The City of Boston, et als. v. Attorney General 

The Division reviewed two separate complaints filed in the Middlesex Probate Court in June 
for modification of the trust fund established pursuant to the will of Lydia Cooper in connection with 
the consolidation of Boston City Hospital with Boston Medical Center Corporation, required to 
preserve the historic mission of Boston City Hospital. The first provided for certain changes 
necessitated by the Boston Public Health Act of 1995 but specifically preserved the fund for 
non-routine maintenance of the Boston City Hospital premises, rather that the benefit of the whole 
consolidated entity. The second permitted use of principal of the fund as collateral in connection with 
the FHA mortgage on Boston City Hospital, but required timely substitution of standby letters of credit 
to protect the capital appreciation of the fund. In each case, the Division assented after negotiation of 
appropriate restrictions and/or safeguards. 



223 



City of Worcester v. Attorney General 

The closing of Worcester City Hospital necessitated the filing of a complaint by the City in 
Worcester County Probate Court, seeking cy pres of forty-odd endowment funds of the defunct hospital 
for public health purposes in Worcester. After negotiation, the Division assented to modified use of 
the funds, including uses specifically directed to the needs of youth and elders. 

Wills, Trusts, and Other Probate Statistics 

During the past fiscal year, the Division received 1,263 probate citations; received and 
reviewed 1,108 new wills, 802 of which contained charitable bequests; and received and reviewed 577 
interim accounts for executors and trustees, as well as 596 final accounts. In addition, the Division 
received 828 miscellaneous probate matters or pieces of correspondence in new or existing probate 
cases, including 72 petitions for license to sell real estate and 29 petitions under G.L. c.203, sec. 25 to 
terminate trusts too small to be administered economically and distribute the trust property to the 
beneficiary, resulting in the availability of more income to the charitable beneficiaries of such trusts by 
reason of elimination of administrative costs. After review and negotiation, a total of 75 1 assents were 
issued in all categories of probate matters. 

Public Administration 

The Division represents the State Treasurer in the public administration of intestate estates 
which escheat to the Commonwealth because the decedent had no heirs. During the year, the Division 
continued to reorganize and update procedures for the 153 case files currently open. This was done in 
cooperation with the Treasury Department of the Commonwealth and the 48 Public Administrators 
currently serving in the several counties of the Commonwealth. Pursuant to these procedures, Public 
Administrators are to send escheated funds directly to the Treasury Department, Unclaimed Property 
Division. In addition, the Division opened files on 42 new intestate estates, 94 estates were closed, and 
33 other miscellaneous public administration matters were handled. 



224 



CHARITY GOVERNANCE 

The Attorney General's oversight of charitable corporations focuses on stewardship by charity 
boards of directors. The Division can become involved when directors breach their individual 
fiduciary duties of due care and loyalty. Under Attorney General Harshbarger, in recent years the 
Division has obtained a number of governance agreements, after investigation, in which charity boards 
have agreed to reform the manner in which they operate and, this year, obtained a criminal conviction 
against a charity fiduciary arising out of breach of the fiduciary duty of loyalty. 

Massachusetts v. Phoebe Spares 

A guilty plea was obtained from the former executive director of an inner city charity that 
provided prenatal and midwifery services to inner city women for embezzlement of $20,000. The 
Commonwealth Defendant was sentenced to 2 years, suspended for 4 years, plus restitution, 200 hours 
cornmunity service, and 4 year ban on position of financial responsibility with nonprofits. 

For-Profit Acquisitions 

This year a substantial amount of the Division's time and resources were spent investigating 
three proposed for-profit acquisitions of health care providers. Massachusetts charitable organizations 
may not, on their own, "convert" to for-profit status. If charitable assets are to be transferred to a 
for-profit, it must be for fair value, the transaction must be necessary and in the best interest of the 
charity, and the charity board must have acted carefully and in a manner uninfluenced by conflict of 
interest. 

At the end of the fiscal year, two acquisitions of nonprofit acute care providers - a hospital 
and an HMO - by for-profit health care chains had been investigated by the Division and approved by 
the court and the third investigation was pending. 



225 



Central Mass. Health Care v. Massachusetts 

Central Massachusetts Health Care, Inc., a non-profit HMO, proposed purchase by Health 
Source, a for-profit chain. The Division's investigation of this proposed transaction included analysis 
by an expert hired by AG with funds provided by buyer and seller and a public comment period. After 
negotiation of certain provisions, the Division recommended that the court approve the sale, with court 
retaining jurisdiction to oversee the second stage, in which governance of the resulting $45 million in 
charitable proceeds from the sale will be determined. The court followed the AG's recommendation. 
The buyer, Health Source, agreed to abide by AG's proposed Community Benefits Guidelines for 
HMOs. 

MetroWest Medical Center v. Massachusetts 

MetroWest Medical Center, a non-profit hospital on two campuses, proposed a joint venture 
with for-profit Columbia/HCA, a national hospital chain. As a result of the proposed transaction, 
MetroWest would sell 80% of its assets to for-profit Columbia, resulting in an 80/20 for-profit 
partnership resulting. After an investigation conducted with expert assistance and including a public 
hearing, the Division engaged in lengthy negotiations with the parties. As a result, a number of 
changes to the transaction were obtained and the Attorney General recommended approval of the 
transaction to the Supreme Judicial Court. Court approval was granted after hearing. Governance of 
the resulting charitable fund, consisting in large part of sale proceeds, remains to be determined 
through a second phase which will include a community based planning process. 

St. Vincent Hospital v. Massachusetts 

The Division is currently investigating the proposed acquisition of Worcester-based St. 
Vincent Hospital and several of its related organizations within the Fallon Health System by OrNda, a 
for-profit hospital chain. As in other Division investigations, an independent expert is assisting the 
Division and a public comment period was a component of the investigation. 



226 



Review of Asset Dispositions 

Under amendments to the non-profit corporations act, which took effect in April 1990, a 
charitable corporation must give 30 days advance written notice to the Attorney General before making 
a sale or other disposition of all or substantially all of the charity's assets if the disposition involves or 
will result in a material change in the nature of the activities conducted by the corporation. G.L. c.180, 
§8A(c). During the year, the Division reviewed 31 such dispositions. 

Charitable Corporation Dissolution Statistics 

In order to cease corporate existence, charitable corporations must dissolve through a 
proceeding in the Supreme Judicial Court. To enforce the public's interest in the disposition of 
charitable assets, the Attorney General is a party to all voluntary dissolutions of charitable corporations 
under G.L. c.180, f 1 1A. After review, negotiation of necessary modifications, and assent by the 
Division, the pleadings are filed by the dissolving charity in the Supreme Judicial Court. 

During the reporting year, the Division assented to 81 final judgments dissolving charitable 
corporations pursuant to section 1 1 A. Also, the Division filed an Omnibus Petition with the Supreme 
Judicial Court to dissolve 22 inactive charitable corporations under G.L. c.180, 1 1 IB. 
SIGNIFICANT DIVISION INITIATIVES 

Attorney General's Guidelines for Health Maintenance Organizations 

The Attorney General issued community benefits guidelines for HMOs during the last fiscal 
year. The voluntary guidelines encourage nonprofit and for-profit HMOs to develop formal programs 
that promote preventive care and improve health status for disadvantaged patients and underserved 
populations. HMOs are asked to report on their progress. The HMO guidelines follow upon the AG's 
community benefits guidelines for nonprofit acute care hospitals. 



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Giving Season Public Education Campaign 

In partnership with the Attorney General's Advisory Committee on Public Charities, the 
Division undertook a continuing public education campaign regarding charitable giving and charity 
stewardship. 

In November, a Guide for Professional Solicitors and the fifth annual Attorney General's 
Report on Charitable Fundraising were published as part of the Attorney General's fifth annual 
"GIVING SEASON" public education campaign. Timed to coincide with charitable appeals during the 
holiday season, and in cooperation with the "Give But Give Wisely" education program conducted by 
the Better Business Bureau and other charitable organizations, this campaign is a long-term effort to 
inform individuals and businesses about the donating process and how to make sure that their 
contributions are put to the best possible use. 

The 31 -page Report on Charitable Fundraising explains how charitable fundraising works, 
including the role that commercial solicitors play, and analyzes the financial reports of 237 fundraising 
campaigns by solicitors. Of the total dollars raised in all campaigns, 34.8% went to charity. In 
solicitation campaigns which involved the purchase of an event ticket, product, advertising, or other 
"premium," the charities retained 21.37%, on average, of the gross proceeds. 

Fourth Annual Conference for Non-Profit Board Members 

The fourth annual conference for non-profit board members, entitled: "Non-Profit Board 
Members: Facing the Challenge of Change" was attended by over 400 volunteer charity directors and 
other members of the charitable sector. Held April 22, 1996 in Marlborough, the conference agenda 
focused on challenges facing charity fiduciaries as they plan for the future in a world of changing 
resources and changing structures. 



228 



Financial Accounting Standard No. 117 

A dispute with the Financial Accounting Standards Board (FASB) regarding the accounting 
treatment of appreciation on donor-restricted funds held by charities was resolved during the year. A 
proposed FASB staff announcement appeared to interpret the Uniform Management of Institutional 
Funds Act to mean that appreciation on "income only" endowment funds should be classified as 
unrestricted. After receiving contrary views from the Massachusetts AG and others, FASB added 
language referring accountants to "other relevant law", thereby signalling that a particular state's law 
may mean that such endowment appreciation is restricted until properly appropriated. 

Conference and Professional Education Presentations and Publications 

As part of the Division's ongoing public education effort, the Director of the Division and 
other Assistant Attorneys General in the Division spoke to numerous charitable groups and served on 
several continuing professional education panels throughout the year, including: Massachusetts 
Continuing Legal Education, Boston Bar Association, Massachusetts Health Council, New England 
Healthcare Tax Seminar, Worcester Public Roundtable, Massachusetts Health and Educational 
Facilities Authority, ARC Massachusetts, National Council of Nonprofit Associations, Tufts University 
Lincoln Filene Center, Massachusetts Council on Aging, Children's Trust Fund; Massachusetts Society 
of CPA's, Not for Profit Accounting and Auditing Committee; Lions Eye Research Fund, Inc.; 
Massachusetts Library Trustees Association. 

National Regulators Workshop on For-Profit Acquisitions 

At the end of the year, the Division was developing and preparing to host in July a national 
workshop for regulators on the issues raised in the acquisition by for-profit businesses of nonprofit 
hospitals, HMO's, and Blue Cross plans. Over 50 regulators from 30 states were expected to attend 
this two and a half day workshop. 



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DIVISION ADMINISTRATION AND STATISTICS 

Enforcement of laws requiring accountability by public charities is central to Division 
responsibilities with respect to charitable funds. With the exception of religious organizations and 
certain federally chartered organizations, all public charities must register with the Division and all 
registered charities must submit annual financial reports. The registrations and financial reports are 
public records and public viewing files are maintained. The Division responded to over 3,579 requests 
to view files in the past fiscal year and, in response, approximately 6,772 files were pulled. 

Charitable Organizations: Registration and Enforcement 

From July 1, 1995 through June 30, 1996, the Division processed approximately 15,227 
annual financial reports and annual filing fees totalled $1,391,330. During this period, 1,224 new 
organizations were reviewed, determined to be charitable, and registered. Each was sent the Division's 
packet of information about the Division's registration and filing requirements. 

As part of an ongoing compliance program, the Division contacted approximately 9,940 
charities whose annual filings were deficient or delinquent to rectify filing deficiencies. 

Issuance of Certificates to Charities Who Fundraise 

Under G.L. c. 68, sec. 19, every charitable organization which intends to solicit funds from the 
public, except religious organizations, must apply to the Division for a solicitation certificate before 
engaging in fundraising. Upon receipt, the Division reviews certificate applications for compliance 
with statutory requirements. Unless there is a deficiency in the application, all certificates are issued 
within a 10-day statutory period. 

This year, 6,705 certificates were requested and processed. 

Registration of Professional Solicitors and Fund Raising Counsel 

Under §§22 and 24 of G.L. c.68, all persons acting as professional solicitors, professional 
fundraising counsel, or commercial co-venturers in conjunction with soliciting charitable organizations 



230 



must register annually with the Division. Solicitors and commercial co- venturers must also file a 
surety bond in the amount of $10,000.00. All fundraisers must also file with the Division a copy of 
each fundraising contract which they sign with any charitable organization, and solicitors must later file 
a financial return regarding each fundraising campaign. 

During the fiscal year ending June 30, 1996, a total of 213 registrations were received and 
approved, resulting in $47,250 in fees to the Commonwealth. Registrations were received from 84 
solicitors, 104 fund-raising counsel, and 25 commercial co- venturers. 
TABLE I: Money Recovered 
For The Commonwealth Treasury 

A. Charitable Registrations, Certificate Fees, $1,431,280.00 
And Fundraiser Registrations 

B. Other fees, requests for copies, requests 

for computer information 3,881 .98 



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REGULATED INDUSTRIES DIVISION 

The Regulated Industries Division represents consumer interests in regard to two 
specific industries: insurance and public utilities. Although some of the Division's work is 
carried on in state and federal courts, most is performed before administrative regulatory 
bodies: the Massachusetts Department of Public Utilities, the Federal Energy Regulatory 
Commission, the Federal Communications Commission, and the Massachusetts Division of 
Insurance. In many of these matters, particularly public utility rate cases, the Division is the 
only active participant advocating on behalf of Massachusetts consumers. 

INSURANCE 

The Division's representation of consumer interests in insurance matters is divided into 
several distinct categories. The Division intervenes in both automobile and health insurance 
rate setting proceedings. The Division also performs a consumer protection/insurance laws 
enforcement function: through the Division's consumer hotline and direct mail and telephone 
communications, the Division receives many consumer questions and complaints. Through 
mediation, negotiation and, if necessary, litigation, the Division obtains both restitution and 
injunctive relief for insurance consumers. Finally, the Division engages in non-case related 
work to advance insurance consumer interests, including legislative, regulatory, educational, 
and other outreach activities. 

RATE CASES 

1996 Private Passenger Automobile Insurance: On August 14, 1995, the 
Automobile Insurance Bureau of Massachusetts ("AIB") filed with the Division of Insurance its 
recommendation concerning the 1996 private passenger automobile insurance rates. The 



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industry requested a 3.15 % increase over the 1995 rates. If approved, this request would have 
been equivalent to an average increase in auto insurance premiums for Massachusetts drivers of 
$28.00 per car or $91 million dollars overall. On behalf of Massachusetts consumers, the 
Division challenged the increase requested by the industry. After several days of evidentiary 
hearings and responsive briefs, the Commissioner issued a decision on December 14, 1995, 
fixing and establishing an average rate for 1996 which is approximately equivalent to a 4.53 % 
decrease from the 1995 average rate. The Division's intervention resulted in savings to 
Massachusetts consumers of $222 million dollars or an average of $68 per insured automobile. 

1997 Private Passenger Automobile Insurance: Proceedings concerning the 1997 
automobile insurance rates began in April of 1996 with notice of the annual hearing called by 
the Commissioner to determine whether it was necessary that the rates for 1997 be fixed and 
established in accordance with M.G.L. c. 175, §1 13B. The Division participated in these 
hearings and took the position that market conditions continued to require that rates be set 
pursuant to M.G.L. c. 175, §1 13B. The Division noted, however, that some level of 
competition already existed in Massachusetts as a result of the large number of group rates and 
deviations approved by the Commissioner during 1996. No decision had been issued by the 
end of the fiscal year although the Commissioner did ultimately concur with the Division's 
position and order that 1997 rates be fixed and established. 

1995 BCBS Non-group Insurance: In April, 1995, BCBS proposed an 8 % increase 
in its Managed Major Medical (MMM) nongroup insurance product. The Division intervened 
in proceedings before the Division of Insurance in opposition to this rate increase. On August 
8, 1995, BCBS filed an amendment to the above filing to change the product offerings. In light 



233 



of the proposed reform of the nongroup health insurance bill pending in the state legislature, 
the Division and BCBS negotiated a continuance in the rate case pending passage of reform 
legislation. Accordingly, there have been no increases in BCBS nongroup indemnity plans 
since 1993. This case will continue into the next fiscal year before it is resolved. 

1996 Bankers Life and Casualty Medicare Supplement Insurance: In November, 
1995, Bankers filed with the Division a request for 30% rate increases for four Medicare 
supplement insurance products with prescription drug benefits, one of which is currently 
marketed to enrollees. The company also filed a request for a 21.5% rate increase for its closed 
core product and for its currently marketed core plan. Representing the interests of seniors who 
may purchase this insurance, the Division intervened, resulting in the Commissioner's approval 
of increases in the range of 10.4% to 15.5% for the six products. The total amount saved for 
consumers was approximately $5 milMon. 

1996 Mutual of Omaha and New York Life Company Medicare Supplement 
Insurance: In July 1995, Mutual of Omaha and New York Life Insurance filed with the 
Division of Insurance for approval of new Medicare supplement plans. The cases were 
consolidated for hearings and for decision. After hearings were concluded, the two companies 
stipulated to reduce their rate request for their Medisupp 2 product from $198 to $166 per 
month, saving the consumers who signed up for these new products approximately $384 per 
annum in premiums. Mutual of Omaha also agreed to reduce its 35% increase request for its 
pre M.G.L. c. 176K prescription drug plan to 20%, thereby resulting in savings to consumers of 
over $50,000. 



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1995 Prudential Insurance Company - AARP Medicare Supplement Insurance: 

In the fall of 1995, the Division participated in hearings to consider the Prudential's proposed 
Medicare supplement insurance requests for increases in their pre OBRA and pre M.G.L. 
C.176K plans. The Attorney General participated in the hearings. The case was settled through 
stipulations that required the inclusion of mandated benefits and notice to all consumers of the 
new plan offerings available as a result of the enactment of M.G.L. C.176K (Medicare 
Supplement Insurance Reform) which mandated coverage to all consumers at generally lower 
rates. 

Mutual of Omaha Medicare Supplement Insurance: In the fall of 1995, the 
Division participated in hearings to consider Mutual of Omaha's proposed Medicare 
supplement insurance requests for increases in their pre OBRA and pre M.G.L. c. 176K plans. 
The Attorney General participated in the hearings. The case was settled through stipulations 
that required the inclusion of mandated benefits and notice to all consumers of the new plan 
offerings available as a result of the enactment of M.G.L. 176K (Medicare Supplement 
Insurance Reform) which mandated coverage to all consumers at generally lower rates. 
CONSUMER PROTECTION/ENFORCEMENT 

The Division also engaged in non-rate case related insurance work during fiscal year 
1996 that involved consumer protection issues and/or enforcement of the Commonwealth's 
insurance laws. Representative matters include: 

EMPLOYERS FAILURE TO REMIT HEALTH INSURANCE PREMIUMS 

During the 1996 fiscal year, the Division continued its work in this area which had 
been initiated in a prior fiscal year. 



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Investigations 

The Division investigated over 60 employers in response to complaints by employees 
that their health insurance had lapsed because of the failure of their employer to pay health 
insurance premiums or otherwise to provide sufficient funding to cover their employees' health 
costs. Some of these complaints involved a dispute between a single employee and the 
employer, and were resolved by payment of the outstanding medical claims by either the 
employer or the insurer. Other complaints required the Division to take more formal action as 
described below. 
Civil Litigation 

The Division entered into consent decrees with two Massachusetts employers who had 
represented to their employees that they were withholding funds for the payment of health 
insurance premiums and also represented to employees that they were providing health 
insurance when in fact they were not. The consent decrees provided that the employers would 
pay all outstanding medical costs of injured employees, take appropriate action to cure any 
harm to employees' credit rating and make contributions to the Massachusetts Consumer Aid 
Fund. The medical claims of almost three hundred employees were paid as a result of these 
settlements. Both employers, Barboza Enterprises, Inc. a car dealer, and State Line Snacks 
Corporation, had initially raised ERISA preemption arguments which, after hearings, were 
rejected by the Massachusetts Superior Court. 
Criminal Litigation 

The Division obtained a grand jury indictment of one employer that it originally had 
investigated for failure to remit health insurance premiums. Further investigation revealed that 



236 



the employer, John E. Flynn, Jr., the owner and CEO of the Boston architectural firm Alonzo 
B. Reed, Inc., also had failed to remit various other payroll withholdings, including employees' 
contributions to the employer's 401(k) plan and state withholding taxes. Flynn has pleaded not 
guilty in Suffolk Superior Court to two counts of felony larceny, four felony counts of failure to 
account for and pay over withholding taxes, and two misdemeanor counts of failure to file state 
income tax returns. This is believed to be the first case in which an employer has been 
prosecuted under a state larceny statute for theft of employee funds. The Division also 
provided the U.S. Attorney's Office in Boston with evidence of the Defendant's violation of 
various federal laws that the Division obtained in the course of its investigation. 
Business Agreements 

During the fiscal year, the Division entered into "business agreements" with three 
employers, MSE Electrical Contracting, Carr Leather, and Design Pak, in which the 
employers agreed to pay the outstanding medical claims of their employees, and to keep such 
payments up to date in the future. Approximately $135,000.00 in medical claims were paid as 
a result of these agreements. 
Regulations 

Pursuant to the Attorney General's consumer protection authority under M.G.L. c. 93 A, 
the Division promulgated regulations to make it an unfair and deceptive act or practice for 
insurers, including health maintenance organizations, to deny medical claims on the basis that 
an employer has failed to remit premiums unless they previously have given written notice to 
subscribers that the employer's plan had been terminated. After public hearing, the regulation 
(940 CMR 9.00) became effective on March 1, 1996. 



237 



Joint Initiative with the U.S. Department of Labor 

The Division and the U.S. Department of Labor continued to collaborate in certain 
investigations and proceedings against employers that have failed to remit health insurance 
premiums or adequately fund their health plans. 
Legislation 

The Division testified before the state legislative Committee for Commerce and Labor 
in support of legislation to amend M.G.L. c. 149 §150C. The current legislation simply places 
liability on corporations for failure to remit premiums to commercial insurance companies. 
The proposed legislation would make persons responsible for the failure to make premium 
payments personally liable for any resulting harm to employees as well as making them 
criminally liable. The legislation also expands the scope of the current legislation for failure to 
remit premiums to Blue Cross and Blue Shield and to health maintenance organizations. The 
legislation was drafted by the Division and filed by Sen. Pacheco in the previous fiscal year. 
At the close of the fiscal year, it was pending before the Commerce and Labor Committee. 
HOMEOWNERS INSURANCE 

The Division continued its work in the examination of the problems faced by urban 
dwellers in the purchase of homeowners insurance. 
Report on Redlining in the Homeowner's Insurance Market 

In July 1995, the Division issued the Attorney General's Special Report on Redlining 
in the Homeowner's Insurance Market. The Report detailed the status of insurance for urban 
dwellers and its availability and affordability. The Report also included the results of an 
examination, conducted by the Office of the Attorney General, of the writing practices of the 



238 



industry. Recommendations were made for measures to improve the type of insurance 
available to urban dwellers. Many of the recommendations were similar to those contained in a 
bill then pending in the state legislature. The bill, on which the Division had worked closely 
with consumer advocates and others, was signed into law by the Governor during the fiscal 
year and contained the majority of the recommendations contained in the Report. Other 
recommendations were voluntarily adopted by the insurance industry without legislation. 
LONG-TERM CARE INSURANCE 

The Division continued its work in the examination of problems faced by elders in 
financing nursing home and other long-term care. 
Consumer Complaints and Education 

The Division started investigations, that are still ongoing, into several consumer 
complaints concerning the marketing practices of various long-term care insurers and their 
agents. The Division responded to consumer inquiries regarding long-term care insurance 
policies. 
Interagency Workgroup 

Members of the Division, along with Bureau attorneys, participated in an interagency 
workgroup (including the Division of Insurance, the Division of Medical Assistance and the 
Executive Office of Elder Affairs) concerning the future financing of long-term care in 
Massachusetts. The purpose of the workgroup is to develop strategies both to increase the 
private financing of long-term care, and to provide financial security to elders who risk 
impoverishment by the costs of long-term care. The Division oversaw the work of a Kennedy 
School of Government student who produced a report on public-private partnerships for long- 



239 



term care insurance, one of the strategies under consideration by the workgroup. The 
workgroup will be continuing into the next fiscal year. 

NEGOTIATED HOSPITAL DISCOUNTS 

The Division conducted a survey of the health insurers and health maintenance 
organizations that provide coverage to Massachusetts consumers to determine their practices 
concerning the passing along of negotiated hospital discounts to their subscribers and members. 
The Division's analysis of the information received in response to the survey will continue into 
the next fiscal year. 

LEGAL ACTIONS 

Commonwealth v. Poitras and the Massachusetts Lobstermen's Association: In 
April of 1990, the Attorney General filed a complaint in Suffolk Superior Court against the 
Massachusetts Lobsterman's Association (the "MLA") and other defendants alleging that the 
defendants had, during the period 1985 through 1988, marketed and sold an accident and health 
insurance plan to fishermen and others in Massachusetts, without being licensed to do so. The 
suit further alleged that defendants failed either to pay, or promptly to deny, valid claims filed 
against the health insurance plan in the aggregate amount of approximately $3 million. In 
January, 1996, the Division filed a Motion for Summary Judgment as to liability only. 
Extensive oral argument was heard on the Commonwealth's motion on June 20. No decision 
had been issued by the end of the fiscal year. 

In re Theodore Johansson: On June 10, 1994, the Division entered into an Assurance of 
Discontinuance with Theodore Johansson, a Framingham insurance agent, who had been 
actively engaged in marketing and selling unauthorized insurance products, particularly those 



240 



of Amalgamated American Employees Association (the "AAEA"), Amalgamated American 
Employees Association Benefit Fund (the "AAEABF"), the American Business League (the 
"ABL"), United Healthcare Benefit Trust ("UHBT"), and United Association of Small 
Businesses (the "UASB"). Pursuant to the Assurance of Discontinuance, Mr. Johansson agreed 
to discontinue selling these products, to pay certain civil damages and costs to the 
Commonwealth, and, at his clients' option, either to refund all premiums collected or to pay all 
medical claims incurred by his clients while their policies were in effect. Mr. Johansson 
subsequently failed to comply with the terms of the Assurance of Discontinuance in several 
material respects, specifically by failing to make, or even to offer, full restitution to his clients. 
Mr. Johansson subsequently filed for bankruptcy protection. The Division intervened in the 
bankruptcy case and obtained additional relief for consumers in the amount of $50,000.00. 

Commonwealth v. Ernest Gallo: In April, 1994, the Division entered into an 
Assurance of Discontinuance with Ernest Gallo, a Leominster insurance agent who was then 
engaged in the marketing and selling of many of the same unauthorized insurance products as 
Mr. Johansson - specifically, products offered by the AAEA, the AAEABF and the ABL. The 
Assurance provided that Mr. Gallo would discontinue selling these products, would pay certain 
civil damages and costs, and, at his clients' option, either refund all premiums collected or pay 
all medical claims incurred by his clients while their policies were in effect. Mr. Gallo, too, 
failed to comply with the terms of his Assurance of Discontinuance and, in February, 1995, the 
Division brought suit against him in Worcester Superior Court. In June, 1996, Mr. Gallo 
agreed to accept a permanent injunction barring him from selling all such products in the 
future, and further agreed to pay the Commonwealth $3,000 in full settlement of the 



241 



Commonwealth's claims. Because Mr. Gallo has filed a third-party action against the out-of- 
state sponsors of the insurance plans, the Court must approve the proposed settlement; such 
action is still, therefore, pending. 

Commonwealth v. Attias Corporation: The Division obtained a consent judgment 
against this rental car agency (doing business as "Rent-A-Wreck"), under which the agency 
agreed to make restitution to injured consumers of $3,000; pay the Attorney General's Local 
Consumer's Aid Assistance Fund over $9,000; and change the standard rental form it provides 
to consumers. The agency had used rental forms that were in violation of the Massachusetts 
statute regarding collision damage waivers. 

Commonwealth v. Coletti: The Division filed a complaint against an insurance 
broker, William Coletti, alleging that he had accepted premium payments from consumers but 
failed to remit the premiums to the insurance companies. The Division obtained a preliminary 
injunction enjoining Coletti from depositing premium payments into his own accounts. The 
Division also obtained restitution for injured consumers. The case was in the discovery phase 
at the end of the fiscal year. 

ASSURANCES OF DISCONTINUANCE 

The Division entered into three Assurances of Discontinuance during fiscal year 1996 
which resulted in benefits to Massachusetts consumers of $58,000. 
In the matter of Sportsmed: The Division obtained an Assurance of Discontinuance from 
this provider of physical therapy services to enrollees in the Group Insurance Commission's 
indemnity plan (known as the "Hancock Plan".) Sportsmed agreed to forego collecting 
amounts in excess of $50,000 that it had "balance billed" enrollees. Sportsmed also agreed to 



242 



conform its billing practices to the requirements of the Hancock Plan, and to provide clear 
explanations to enrollees about the share of the bill for which they are responsible (the 
copayment.) Finally Sportsmed agreed to waive copayments on a sliding scale for lower 
income consumers. 

In the Matter of Alan N. Rosenfield: In October and November, 1995, the Division 
investigated reports that Mr. Rosenfield, an agent who had recently sold his proprietary interest 
in an insurance agency in Central Square, Cambridge, had failed, on multiple occasions, to 
transmit premiums received by him to the relevant insurance company, causing various 
consumers to become, unknowingly, uninsured. The Division determined that Mr. Rosenfield 
had engaged in this practice to a fairly significant extent in 1994, conduct for which he had 
paid restitution, and for which he had been sanctioned by the Division of Insurance. Our 
investigation also determined, however, that at least one consumer had been rendered 
uninsured by Mr. Rosenfield's actions subsequent to the DOI's intervention, and had sustained 
an uninsured loss of approximately $8,000 to her home as a result. The Division served a five- 
day letter upon Mr. Rosenfield in November, 1995, pursuant to Chapter 93 A. After 
negotiations with this Office, Mr. Rosenfield agreed to make full restitution to the harmed 
consumer, and to enter into an Assurance of Discontinuance in which he agreed permanently to 
terminate the practice in question, and to make prompt restitution to any harmed consumer who 
may subsequently come forward. The Assurance of Discontinuance was entered by the Suffolk 
Superior Court in February, 1996. Mr. Rosenfield is no longer a practicing insurance agent. 

In the Matter of James Hourihan: The Division obtained an Assurance of 
Discontinuance from this insurance broker who, on several occasions, took premiums from 



243 



consumers and did not purchase an insurance policy. The broker, whose license was revoked 
by the Division of Insurance, agreed that he would not, at any time, engage in the business of 
insurance. 

CONSUMER COMPLAINTS 

After investigation and intervention, Assistant Attorneys General in the Division were 
instrumental in resolving several matters involving "vanishing premiums" on behalf of 
consumers with an estimated value to consumers of over $420,000. Companies that 
participated in these settlements were : Prudential Life Insurance Company of America, 
Boston Mutual Life, Equitable Life Assurance Society, Metropolitan, Bankers Life, New 
York Life, Sentry, The New England, 

In addition to the many consumer complaints which the Division was able to resolve 
on behalf of consumers, members of the Division explained and worked with many consumers 
to guide them in such matters as: understanding the intricacies of various entitlement programs 
and the interplay between them; the billing practices of their health insurers; continuation of 
health insurance coverage following termination of employment or following divorce and the 
like. While no monetary consumer benefit can be placed on these activities, they provide a 
valuable service to Massachusetts consumers, many of whom are elderly or who have no other 
sources to turn to. 

Consumer Hot-Line and Paralegal Resolution of Inquiries and Complaints: 
During the fiscal year, the division received and responded to over 6,000 telephone inquiries; 
almost 1 100 written complaints, an increase of 50 % over the number received in the prior 



244 



fiscal year. Over $750,000.00 were received by consumers through the intervention of the 
paralegals and volunteer interns, an increase of almost 300 % over the prior fiscal year. 
OTHER ACTIVITIES 
LEGISLATIVE ACTIVITIES 
Non-group Health Insurance Reform 

Division staff worked in cooperation with a legislative coalition, chaired by Rep. 
Byron Rushing, to craft a bill (H. 5601) that would reform the nongroup health insurance 
market, ensure portability of coverage in all markets and amend the small business law to 
increase the size of groups from 25 to 50. The bill, enacted after the end of the fiscal year, 
includes reforms that the Attorney General has long advocated: mandatory access to coverage 
regardless of health status, no preexisting condition exclusions, no waiting periods, annual 
open enrollments, modified community rating and standard benefit packages. The bill 
guarantees access to health insurance to more than 600,000 Massachusetts residents who are 
currently uninsured. 
Health Care Access 

Division staff worked with legislative leaders and a coalition of over fifty health 
related organizations to secure enactment of legislation which: expands Medicaid eligibility to 
approximately 93,000 more Massachusetts citizens; expands eligibility to the Children's 
Medical Security Plan to approximately 125,000 more children; and established a prescription 
drug assistance program to approximately 65,000 needy seniors. 
Patient Protection Act 



245 



Division staff testified in favor of a bill that would require health maintenance 
organizations ("HMOs") to provide greater disclosure to their members regarding the 
operations of HMOs. 
REGULATORY ACTIVITIES 
Medigap Insurance 

In June 1996, the Division presented testimony at a public hearing convened by the 
Division of Insurance to monitor the overall condition of the Massachusetts market for 
Medicare supplement insurance following the reform enacted by the legislature in December, 
1993. 
Risk Bearing Providers 

In September 1995, Division staff presented testimony to the Division of Insurance 
regarding the insurance status of physician hospital organizations that contract directly with 
purchasers of health care services. 

At the request of the Massachusetts Organization of State Engineers and Scientists, the 
Division conducted an investigation into the change, by CMHC, a Worcester based HMO, from 
an open drug formulary to a closed formulary. Although no violation of law was found with 
regard to the operation of the closed formulary, CMHC returned to an open formulary soon 
after the investigation began and the Division continued to examine the procedure by which the 
change had occurred into the next fiscal year. 
MISCELLANEOUS ACTIVITIES 
Guest Speakers 



246 



Members of the Division made presentations to several organizations regarding 
insurance and financial exploitation of elderly. One member of the Division participated in the 
Massachusetts Continuing Legal Education's Annual Health Law Update. A member of the 
Division made a presentation to the Boston Chapter of the A ARP on purchasing Long Term 
Care Insurance. 
Public Education Programs 
Consumer University 

A member of the Division participated in the presentation of Consumer University, an 
Attorney General sponsored consumer advice program that was presented to over a 1,000 
consumers statewide. 
Elder Health Care: Crisis at the Crossroads 

Members of the Division participated in, and drafted a Conference Report on this 
follow-up event to the White House Conference on Aging. 
Newsletter 

The Division prepared and distributed, to approximately 2,000 elderly consumers, a 
newsletter explaining the reform of the way in which Medicare Supplement insurance policies 
are sold in Massachusetts and advising them of their options. 



247 



ESTIMATED SAVINGS TO CONSUMERS 

Auto Rate Cases 222,000,000 

Health Insurance Rate Cases 5,050,000 

Consumer Insurance Matters 563,000 

Consumer Hotline 750,000 

Total 228,363,000 

UTILITIES 

The composition of the Regulated Industries Division's utility workload in fiscal year 1996 
continued to reflect the rapid and dramatic changes underway in the telephone, electric and gas utility 
industries: there were few traditional rate cases and much of the Division's work involved 
consideration of alternative approaches to rate regulation that place greater reliance upon utility 
performance and competitive forces and less on the review of actual utility costs. These efforts 
involved advocating new structures and rules to maximize die consumer benefits from the change in 
regulatory approach and protecting the interests of small residential and business customers during the 
transition to new regulatory frameworks. While some of this work occurred in contexts applicable to 
all three of the public utility industries, most occurred either in the context of industry specific 
administrative rulemaking/factfinding proceedings or in adjudications of specific cases. Examples of 
the Division's public utility work relative to each industry in fiscal year 1996 include: 

Telecommunications 

NYNEX, D.P.U. 95-83. In August, 1995, New England Telephone Company (d/b/a/ 
"NYNEX") made its first "price caps" compliance filing, in which it proposed rate changes designed to 
produce a $38.3 million reduction in revenues for the twelve month period beginning September 1, 
1995. This filing was required under the terms of the DPU's May 1995 decision in which it rejected 



248 



the traditional rate of return form of rate regulation. The Department did, however, adopt in large 
measure many of the improvements to the structure of the Company's proposal that the Division had 
argued were necessary to protect the public interest. It ordered stricter service quality standards than 
those proposed by the Company and required the Company to pay significant penalties in the form of 
lower future rates if it fails to meet those standards. In addition, it ordered a more than a 50 % increase 
in the assumed rate of productivity improvement by the Company (from 2.5 to 4.1 %) that must be 
subtracted from the inflation rate to determine the amount by which its rates will be permitted/required 
to change. As a result of the Division's success on the productivity offset and service quality penalty 
issue, the Company's filing at the close of the fiscal year resulted in a $38 million decrease in its rates 
rather than a $3.4 million increase it would have been permitted under it original proposal. 

Commonwealth v. Info Access, et al Following oral argument October 30, 1995, the U.S. 
District Court for the District of Massachusetts denied motions to dismiss filed by the four defendants 
in a law suit filed in October, 1994 by the division. The suit concerned the provision of "pay per call" 
services over 1-800 telephone numbers by the four defendants: InfoAccess, Inc.; MSI Operator Assist, 
Inc.; Phone I.D., Inc.; and ATI Operator Assist, Inc. This suit, which was the first action ever filed by a 
state Attorney General under the Telephone Disclosure and Dispute Resolution Act ("TDDRA") of 
1992, was filed in response to numerous consumer complaints over changes included in their telephone 
bills for calls purportedly made to 1-800 numbers. The complaint alleged that the defendants' 
provision of "pay per call" services through 1-800 numbers violated the terms of TDDRA, the 
TDDRA regulations promulgated by the FCC and the Federal Trade Commission and the 
Massachusetts Consumer Protection Act. Among others, the complaint alleged that the following 
actions of the defendants were contrary to the requirements of TDDRA: advertising and providing pay 
per call services through 1 -800 numbers without first securing a valid agreement to pay for such 
services with the party to be billed; failing to make appropriate disclosures in advertisements regarding 



249 



the cost of calls to the service; and failing to include the disclosure "preamble" message required by 
TDDRA. Informal pretrial discovery was underway at the end of the fiscal year. 

Telephone Competition, D.P.U. 94-185/F.C.C. 96-98. In January, 1995, the DPU opened 
an investigation to consider the adoption of regulatory mechanisms to encourage and develop 
competition within the Massachusetts local telephone market. Following a round of prefiled written 
testimony and discovery, 1995, extensive evidentiary hearings were held in the summer and fall of 
1995. Initial briefs were filed in January but following enactment by Congress of the 
Telecommunications Act of 1996, which required that the Federal Communications Commission 
(FCC) promulgate similar rules, the DPU deferred resolution of most the issues pending the conclusion 
of the FCC proceeding. In May, the division filed its reply brief on the issues still before the DPU as 
well as comments with the FCC. At the end of the fiscal year, neither the FCC nor the DPU had issued 
decisions. 

Electricity 
Electric Utility Restructuring, D.P.U. 95-30. On August 15, 1995, the Department issued a 
decision in its investigation into the question of whether the Commonwealth's electric utility industry 
should be restructured to allow competition and consumer choice to control the price of power sold in 
Massachusetts. In this decision, the Department agreed with many of the positions advanced by the 
Division in comments filed earlier in the year. In particular, it indicated that reducing cost, over time, 
for all consumers of electricity was its primary objective and found that the interests of ratepayers 
would best be served by an expedient and orderly transition from regulation to competition in the 
generation sector. In order to facilitate development of an efficient industry structure and regulatory 
framework that minimizes long-term costs to consumers while maintaining the safety and reliability of 
electric services with minimum impact on the environment, the Department established a schedule by 
which electric companies must file within six months: (1) a plan for moving from the current regulated 



250 



industry structure to a competitive generation market and to increased customer choice: (2) illustrative 
rates and supporting information that, at a minimum, indicate unbundeled charges for generation, 
distribution, transmission, and ancillary services: (3) an identifiable charge reflective of the level of 
stranded costs to be recovered, if any, with all necessary supporting information; and (4) a plan for 
incentive regulation of the transmission and distribution systems. 

Electric Utility Restructuring, D.P.U. 96-100; Massachusetts Electric Company, D.P.U. 95- 
25; Boston Edison Company, D.P.U. 96-23; Eastern Edison Company, D.P.U. 96-_; Western 

Massachusetts Electric Company, D.P.U. 96- . In compliance with the DPU'S August 1 1, 1995 

order in Electric Industry Restructuring, D.P.U. 95-30, four major electric utilities filed restructuring 
plans on February 16, 1996. In response to these filings, the Department opened a Notice of 
Inquiry/Rulemaking to examine issues related to: (1) market structure, (2) market power, (3) 
transmission, (4) distribution, (5) stranded cost calculation and recovery mechanism, (6) rate 
unbundling, (7) performance-based ratemaking, (8) environmental regulation and demand-side 
management, (9) default service, (10) universal service, (1 1) the effect of restructuring on municipal 
electric companies, and (12) the local and utility tax impacts of restructuring. During the spring, the 
Division and other interested parties filed comment analyzing and proposing changes to the utility 
restructuring plan. In these Comments, the Division articulated the five restructuring principles that 
the Attorney General had adopted earlier: restructuring should result in lower prices; the benefits of 
restructuring should be made available to all consumers; a restructured utility industry must continue to 
protect the environment and promote conservation; restructuring should ensure some measure of 
affordability for low-income consumers; and the transition to a fully functioning, stable and reliable 
restructured market for electric power must be monitored closely. On May 1 the Department issued a 
proposed "restructuring" regulation. The Division filed comments on the proposed regulations and 
participated in hearings on those regulations that began in June and were still continuing at the end of 



251 



the fiscal year. Final comments are to be filed in August 1996 and a decision is scheduled for 
September. 

Cambridge Electric Light Company, D.P.U. 95-36/94-101. In March, 1995, Cambridge 
Electric Light Company ("CELCo") sought DPU approval of new tariffs to be apply to large industrial 
customers that installed their own electric power generating equipment and thereby become "partial" 
rather than "total requirements" customers. This filing followed a May, 1994 filing by the 
Massachusetts Institute of Technology ("MIT") seeking a DPU order establishing partial requirements 
rates applicable to the service to be provided by the Company to MIT after it completed construction of 
its own electric power generating unit. In 1994, MIT had purchased more than 10 % of all the electric 
power sold by the company to end users. In addition to tariffs setting forth the charges for partial 
requirements services, the company filing also included a proposed exit fee to recoup most of the costs 
which would be "stranded" by MIT's departure. In the briefs filed during the summer of 1995, the 
Division argued that the burden of any costs "stranded" by the departure of MIT should be borne by 
either or both of the entities whose actions gave rise to those costs (the Company's shareholders or the 
departing customer), not the Company's remaining customers. On September 29, 1995 the DPU 
determined that it was appropriate to balance the interests of the potential self-generation customers, 
the Company, and the Company's other ratepayers by apportioning the stranded costs claimed by the 
Company in a manner where by MIT was required to make payments to the Company to offset 75 % of 
the net costs "stranded" by the decision to rely on self-generation for a significant portion of its power 
needs. MTT has appealed this decision to the Supreme Judicial Court. 

Massachusetts Electric Company, D.P.U. 95-40. In March, 1995, Massachusetts Electric 
Company sought DPU approval of either an alternative form of regulation or a rate increase of $62 
million. Under the terms of the Company's alternative regulation proposal, its rates would not be 
governed by traditional cost of service regulation, but would be allowed to increase each year by 20 % 



252 



of the amount by which its average rates are below the average for other Massachusetts electric 
utilities. If accepted, this proposal would result in a $25 million increase in 1995 and $30 million 
increases in succeeding years. The Company proposed to collect $56 million of its proposed $62 
million increase from its residential customers, an increase that would result in a 13 % increase for the 
average residential customer. The DPU held two days of hearings in May on the alternative regulation 
proposal and in briefs filed in June the Division urged the DPU to reject the proposal because, among 
other deficiencies, the proposal did not create any incentive to lower rates and, instead, was designed to 
reward the Company for it past decisions. On July 21, 1995, the DPU rejected the Company's 
alternative regulation proposal. Thirteen additional days of hearings were held in June on the 
Company's proposed rate increase, during which the Division challenged the overall rate increase and 
presented the testimony of an expert witness to challenge the Company's proposed allocation of costs 
between its various customer classes. On September 28, 1996, the DPU issued its final order granting 
the Company only $31 million of its requested $62 million increase. In addition, the DPU agreed with 
the Division that the proposed allocation of the increase was unfair and awarded only a 0.26 % increase 
to residential customers. 

Nantucket Electric Company/NEES, D.P.U. 95-67. In May, 1995, the Division reached an 
agreement with Nantucket Electric Company and the New England Electric System ("NEES"), the 
parent company of Massachusetts Electric Company, concerning the terms under which NEES would 
be allowed to acquire Nantucket. Under the agreement, NEES agreed to reduce Nantucket's current 
base rates charged by 5 %, effective upon DPU approval of the acquisition. NEES also guaranteed that 
Nantucket's base rates would not increase during the first year of the operation of a submarine cable to 
be constructed to connect the island with the New England Power Pool. The DPU initiated an 
investigation into the proposed merger late in June, 1995 and in a decision issued on October 10, 
approved the merger and the settlement agreement. 



253 



Boston Edison Company, D.P.U. 95-1 A-l. The Division participated in the DPU's review of 
Boston Edison Company performance of its operation of its electric power generating units during the 
period from November, 1993 through October, 1994. In briefs filed in the spring of 1995, the Division 
urged the DPU to find that actions by Boston Edison in operation of its power plant did not satisfy the 
prudent operations standard. It argued that the Company should be required to make refunds for 
replacement power costs previously collected in regard to nearly 20 days of outages at the Pilgrim 
nuclear plant as well as various outages at the Company's New Boston and Mystic generating plants. 
A decision by the DPU had not been issued at the close of the fiscal year. 

Fitchburg Gas & Electric Company, D.P.U. 95-75. On June 15, 1995, Fitchburg Gas & 
Electric Company filed tariffs that would create a unique type of Economic Development rates for new 
or expanding industrial customers based on market-based energy pricing. This service was designed 
to promote economic growth in the Company's territory. The new tariff would be available only to 
large industrial general service customers and sets the price for the power component of the service 
based upon a wholesale market price of power. Incremental power supply acquisitions for Energy 
Bank requirements will be procured directly from the wholesale market through competitive 
acquisitions rather than through traditional electric utility supply acquisition approaches. The result 
will be a rate which equals 50/KWH rather than the current 80/KWH. Energy Bank service will also 
benefit existing customers since the Company intends to flow through the contributions Energy Bank 
customers will make to transmission and distribution costs. On November 2, 1995, the Division filed a 
brief supporting the FG&E proposal with proposed modifications that the DPU ensure that costs 
incurred to secure new power supply for Energy Bank customers do not have an adverse impact of the 
Company's existing customers, and that any cost reductions to existing customers are directly credited 
to customer bills. On November 30, 1995 the Department issued a decision approving Energy Bank 
Service with the Division's proposed modifications. 



254 



Western Massachusetts Electric Company, D.P.U. 94-8C; D.P.U. 95-8C; D.P.U. 96-8C. On 

April 30, 1996, the DPU approved a settlement between Western Massachusetts Electric Company 
("WMECo") and the Attorney General which terminated the Company's 1994 and 1995 Generating 
Unit Performance Reviews and a portion of the 1996 Performance Review relating to the Millstone 
Unit 2 October 1, 1994 Refueling Outage (RFO 12). The Settlement continues, until March 1, 1998, 
the existing rates that reflect the $8,000,000 per year reduction in WMECo's customers' overall 1994 
bills that would have otherwise terminated on February 1, 1996 and that the Department approved on 
May 24, 1994 as part of a previous settlement with the Attorney General. ($16.6 million total rate 
reduction). The Settlement also resolves other outstanding issues. The Company will not seek to 
recover from customers $17 million ($7,000,000 per year for 1996; $10 million per year for 1997) of 
additional expenses that will be used to increase the decommissioning funding accruals for Millstone 
Units 1, 2 and 3 and pay deferred income tax obligations related to generation assets. The settlement 
also provides for the transfer of $8 million of lost base revenues now included in the Company's 
Conservation Charge to base rates. 

Gas 
Bay State Gas Company, DPU 95-52/104 -On December 22, 1995 the DPU approved a 
settlement that the Division had reached with Bay State Gas Company under which the Company was 
required to unbundle all of its commercial and industrial rates into separate transportation and gas 
portions and, thereby, allow all of its business customers to choose whether to purchase gas from the 
Company or competitive suppliers. As a part of this redesign of its rates, the Company increased its 
existing "transportation" rates to include monies for system costs that previously had not but should 
have been collected from transportation customers. 



255 



In addition, the settlement required the Company to establish a path breaking residential 
transportation pilot program in its Springfield Division. At the end of the fiscal year, customers were in 
the process of being solicited for participation in the pilot program. 

Interruptible Transportation and Capacity Release, DPU 93-141A and 141B 
On February 14, 1996 the DPU issued a decision in an investigation concerning pricing mechanism for 
interruptible transportation ("IT') service and capacity release ("CR") transactions as well as the 
ratemaking treatment to be accord revenue from such transactions. In its decision, the Department 
adopted the positions taken in comments filed earlier by the Division, determining that the pricing for 
IT service should reflect the value of service (i.e., the price of competitive alternatives) and directed 
that all margins be flowed through to all firm sale and transportation customers on a 75% ratepayer, 
25% shareholder split on those margins that exceeded a threshold amount. The threshold was set at the 
level of margins from the last 12 months (ending April, 1996), and any margins below that threshold 
will flow 100% back to firm customers. For CR margins, the margins above the annual threshold 
would be subject of the same 75%-25% split but these margins would be flowed through only to firm 
sales customers. 

Boston Gas Company, D.P.U. 95-50. On May 17, 1996, the Company petitioned the DPU 
for a rate increase of $30 million in annual revenues or a 5 % increase. The Company also requested 
approval of an alternative form of rate regulation or Performance Based Ratemaking and requested that 
its rate be unbundled into distribution and commodity charges. The Division intervened in this 
proceeding on behalf of those utilities' customers. At the close or the fiscal year, a procedural schedule 
had not yet been adopted in this proceeding. 

Fall River Gas Company, D.P.U. 96-60. On May 17, 1996, the Company petitioned the DPU 
for a rate increase of $5.1 million in annual revenues or a 1 1.86 % increase. The increase would result 
in increases to small customers during the winter months of between 15 and 24 %. The Company also 



256 



requested approval of an alternative form of rate regulation or Performance Based Ratemaking. The 
Division intervened in this proceeding on behalf of those utilities' customers. At the close of the fiscal 
year, a procedural schedule had not yet been adopted in this proceeding. 

Essex County Gas Company, D.P.U. 96-70. On May 15, 1996, the Company petitioned the 
DPU for a rate increase of $3.4 million in annual revenues or a 7.4 % increase. The increase would 
result in increases to small customers during the winter months of between 10% and 12%. The 
Division intervened in this proceeding on behalf of those utilities' customers. At the close of the fiscal 
year, a procedural schedule had not yet been adopted in this proceeding. 

Blacks tone Gas Company, D.P.U. 96-65. On June 15, 1996, the Company petitioned the 
DPU for a rate increase of $1 14,000 in annual revenues or a 13.2 % increase. The increase would 
result in increases to small customers during the winter months of between 10 and 13 %. The 
Company also requested approval of an alternative form of rate regulation or Performance Based 
Ratemaking. The Division intervened in this proceeding on behalf of those utilities' customers. At the 
close of the fiscal year, a procedural schedule had not yet been adopted in this proceeding. 

Miscellaneous 

The Boston Edison DSM Settlement Board. The Settlement Board, which is chaired by the 
Attorney General, undertook the following initiatives: 

• On September 28, 1995, the Settlement Board was the primary sponsor of a "Distributed 
Utility Workshop", which was held at the Boston Park Plaza and attended by over 100 energy 
professionals from across the nation. The Division Chief and an Assistant Attorney General 
from the Division spoke at the Workshop. 

• The Settlement Board filed written testimony on February 29, 1996 and presented oral 
testimony on May 30, 1996 before the Massachusetts Board of Building Regulations and 



257 



Standards proposing revisions to the Massachusetts State Building Code aimed at increasing 

energy efficiency in low-rise residential buildings. 
• The Settlement Board co-sponsored a conference on June 7, 1996 entitled: "Integrating Clean 

Air Policy to Improve Air Quality and Reduce Pollution Control Costs for the Electric Power 

Industry." The conference featured presentations by and panel discussions between 

environmental, health care, energy and governmental professionals. 
ESTIMATED SAVINGS FOR MASSACHUSETTS UTILITY CONSUMERS; $80 million 



258 



CIVIL INVESTIGATION DIVISION 

The Civil Investigation Division conducts investigations primarily for divisions within the 
Public Protection and Government Bureaus. In addition, CID also investigates cases or matters within 
the Family and Community Crimes and Business and Labor Protection Bureaus and, on occasion, for 
the Executive Bureau, or in conjunction with the Criminal Bureau. 

The major duties of Division investigators are: locating and interviewing victims, witnesses, 
subjects and others; obtaining and reviewing documentary evidence from numerous sources including 
individuals, corporations, and federal, state, county and municipal agencies; conducting surveillance, 
background checks and asset checks; analyzing financial records and performing other forensic 
accounting functions; and, testifying before the Grand Jury and at trial. 

In fiscal year 1996, the Division initiated 474 investigations in the following major areas: 
PUBLIC PROTECTION BUREAU 
Consumer Protection and Antitrust 

Investigators continued to perform their traditional role by assisting the office in bringing G.L. 
c. 93A enforcement actions against businesses and individuals in major consumer areas such as 
automobile sales and repair, credit repair services, travel services, health spas, retail sales, computer 
scams, advance fee loan scams and employment schemes. Areas also included numerous issues 
affecting the elderly and vulnerable populations such as the unauthorized practice of law, investment 
and home improvement scams. 

The Division also initiated several investigations and surveys to determine compliance with 
existing laws and regulations pertaining to numerous consumer areas. 
Civil Rights/Liberties 

The Division investigated "hate crimes," allegations of police misconduct and other violations 
of the Massachusetts Civil Rights Act. Investigations were also conducted into allegations of 



259 



discriminatory housing and employment practices, as well as investigations to determine compliance 
with the rules and regulations established by the Americans with Disabilities Act and the Architectural 
Access Board. Division staff interviewed victims, witnesses and, where appropriate, subjects of such 
investigations. Investigators obtained and reviewed police reports, court documents and other available 
evidence. 
Public Charities 

The Division investigated individuals associated with organizations who raised funds from the 
public in violation of Massachusetts law. Investigators interviewed victims, usually business people, 
who made donations to a charity based on the representations of a solicitor. In some instances, 
solicitors posed as law enforcement or other public officials or otherwise misrepresented themselves or 
the charities' purpose. Investigators worked with local police departments, district attorneys and 
neighboring state attorneys general in locating "couriers" who picked up donations. The Division's 
financial investigators reviewed and audited books, records and financial reports of many non-profit 
organizations. 
Regulated Industries 

Investigators continued to work with PPB and RID attorneys to review and investigate 
businesses and organizations that withheld from employees contributions for health insurance 
premiums, but failed to actually purchase the health insurance coverage. Other cases investigated 
included the mishandling of premiums by an insurance broker, the sale of fraudulent or costly life 
insurance and other policies to the elderly, and the failure to provide auto insurance coverage by a car 
rental agency. 

Division investigators concluded their participation in an office working group assigned to 
investigate allegations of discriminatory redlining by the insurance industry in the sale of homeowners 
insurance, which resulted in the issuance of a special report on the results of that review. 



260 



Bureau Prosecutor 

Investigators worked with the Bureau prosecutor on numerous cases which resulted in 
indictments against individuals for violations of the Commonwealth's consumer, charitable and 
insurance laws. Cases included larceny against the elderly and vulnerable by financial advisers, 
attorneys, home improvement contractors and auto dealers. Cases also involved investigations relative 
to the unlicensed practice of medical professions, health care fraud, illegal charitable fundraisers and 
embezzlement from non-profit organizations. 

The Division also continued to play a key role in the Human Services Institutional Abuse 
project within PPB. Investigators interviewed victims and witnesses and collected documentary 
evidence. In several cases, guilty verdicts were obtained for rape and assault and battery on clients of 
human service agencies. 

GOVERNMENT BUREAU 
Environmental Protection 

The Division's role in EPD cases primarily involved locating and identifying assets of 
potentially responsible parties liable for paying costs incurred by the Commonwealth in the clean-up of 
polluted or hazardous waste sites. Investigators also located former employees and officers of defunct 
companies responsible in part for such violations, and reviewed, evaluated and analyzed financial 
documents and prepared ability to pay analyses. 
Trial 

The Division played a major role in tort actions filed against the Commonwealth by 
investigating allegations of abuse, mistreatment and deaths of clients in state care; alleged wrongful 
termination of state employees; and, personal injuries and other damages which occurred on state- 
owned property and/or in accidents on state roads or involving state cars. The Division also 
investigated cases involving contract disputes and eminent domain proceedings. 



261 



CRIMINAL BUREAU 

Safe Neighborhood Initiative (SNI) 

The Division continued its assistance to the office's Abandoned Properties project by 
conducting research on target properties primarily to determine the status of ownership and existence 
of encumbrances of the buildings, and also in some instances, assisted in inspecting properties 
scheduled for renovation. 

FAMILY & COMMUNITY CRIMES BUREAU 
Victim Compensation & Assistance 

In Fiscal Year 1996, Division investigators assisted the VCAD in disposing of all outstanding, 
court-based cases. A total of 350 cases were completed by Division staff to eliminate an existing 
backlog of approximately 1000 cases. 

BUSINESS & LABOR PROTECTION BUREAU 
Insurance Fraud Division 

In conjunction with the protocols established by the Attorney General's Task Force to Reduce 
Waste, Fraud and Abuse in the Workers' Compensation System, the Division continued to investigate 
allegations that state employees or employees of self-insured companies were fraudulently receiving 
workers' compensation benefits or other insurance benefits. 

Investigators worked with the Insurance Fraud Bureau of Massachusetts in a joint effort to 
investigate instances of premium avoidance by employers attempting to defraud insurers of premiums 
owed for workers' compensation coverage. 



262 



STATISTICS 

The Division opened 474 investigations in Fiscal Year 1996, with 275 investigations 
ongoing as of June 30, 1996. Case distribution by division and/or bureau is as follows: 



DIVISION/BUREAU 


OPENED 
DURING FY '96 


ONGOING AS 
OF 6/30/96 


Consumer Protection/ Antitrust 


62 


41 


Civil Rights 


24 


13 


Public Charities 


5 


5 


Regulated Industries 


11 


4 


PPB/Criminal 


22 


28 


Government 


2 


1 


Environmental Protection 


23 


8 


Trial 


323 


171 


Insurance Fraud 


2 


4 


TOTAL 


474 


275 



263 



PUBLIC PROTECTION BUREAU 
CRIMINAL DIVISION 

The Criminal Division of the Public Protection Bureau prosecutes criminally a myriad of 
crimes related to the priority areas of the Bureau. The Division enables the Bureau to have the 
unique capability of protecting the public through both civil and criminal enforcement 
mechanisms. Assistant attorneys general bring criminal cases in the District and Superior Courts 
throughout the Commonwealth as well as conduct ongoing investigations, all under the 
supervision of the Chief Prosecutor. 

Substantive target areas for criminal focus continue to include consumer-related crimes, 
elder fraud, health care fraud, fraudulent charities solicitations, abuse of disadvantaged populations 
by staff members, and unauthorized practice of certain professions. 

I. DISPOSED IN COURT (22) 

JONDLEJPaul Brownsberger/Bigelow Plea 6-24-96 

Mgd Medical Crimmins/Hollingsworth Suffolk Superior 

QUERESHI,Z. 

Prosecution of Maiden chiropractor and his company along with a businessman from 
New York for health care fraud under C.175H and larceny. 
JONDLE - nolle prosequi 
MANAGED MEDICAL - Guilty $1000 fine 
$1007 restitution 
QUERESHI - Guilty $ 1 000 fine 

$9000 restitution 

JONDLE, P. Brownsberger Plea on 6-24-96 

Crimmin Maiden Dist Ct 

Prosecution for unauthorized practice by a Maiden chiropractor. 
Guilty $1000 fine and 150 hours of 
Community service. 

TILTON,J. Cooper Plea on 6-18-96 

Lawrence Dist Ct. 

Prosecution of Methuen man for stealing money from a mentally-retarded man through 

several schemes. 

Continued without a Finding for one year. 



MOLLOY,V Cooper Plea on 5-07-96 

Butler Middlesex Superior 

Prosecution of a lawyer for stealing money from two different clients; one is an auto 
claim and one is an estate. Case was combined from two counties. 
Guilty 2 Vi years in the House of Correction, 



264 



with 9 months to serve, balance suspended for 
5 years with restitution of $61,500 and no 
positions of fiduciary responsibility. 

FARRIER, R. Martinez Plea on 4/2/96 

Dale/Russo Norfolk Superior 

Prosecution of a home improvement contractor for taking money from elders after 
promising to renovate their homes and doing little or no work. We combined 
cases from Plymouth, Norfolk and Middlesex counties for a plea. 
Guilty one year to serve in the House of Correction, to be followed by 4-5 years 
MCI Cedar Junction suspended for 3 years with 

A) restitution of $207,573 

B) no elders as clients 

C) no positions as a fiduciary 

D) no contact order with witnesses 

E) substance abuse treatment 

WARD,George Brownsberger Plea 3-4-96 

O'Connell Middlesex Superior 

Prosecution of a home improvement contractor for taking money from elders after 
promising to renovate their homes and doing little or no work. The defendant is doing 
New Hampshire time for the same thing. 

Guilty 3-5 years, one year to serve from and after 

New Hampshire sentence now serving, balance 

suspended for 3 years. On Count 2, 3-5 years 

suspended from and after Count 1 for 3 yrs. 



SOARES,Phoebe Carriker Plea 2-7-96 

Ormond Suffolk Superior 

Prosecution of a former executive director of a charity for stealing the charity's 

money. 

Guilty 2 years House of Correction, suspended for 2 

years with $19,262 restitution, and 200 hrs comm serv, 

no position of financial responsibility 

SMITH, Kevin Martinez Plea 1-24-96 

Stone Cambridge Jury 6 

Prosecution of a DMR staff member for physically abusing a patient. 
Guilty 2 yrs probation w/conditions 

EDWARDS, C. Cooper Plea 1-24-96 

Woburn Dist Ct 

Prosecution of an unlicensed dental hygenist. 
Guilty 1 year probation w/conditions 



265 



WILKINS,C. Whalen Plea 1-17-96 

Stone Middlesex Superior 

Prosecution of a van driver for sexual assault of a female DMR client. 
Guilty 5-7 years at MCI Cedar Junction with 
1 year to serve, balance suspended for 5 years 
with conditions 



FORGIONE,Fred Brownsberger Plea 1-5-96 

Ormond Suffolk Superior 

Prosecution of a defendant for taking money from an elderly man using several 

larcenous schemes. 

Guilty One year House of Correction to serve, 

balance suspended for 1 year 

GALENA, F Brownsberger Disposition 1-2-96 

Crimmins Suffolk Superior 

Prosecution of individuals for health care fraud using c. 175H. 
Nolle prosequi filed and a civil consent judgment, 
a ban, and contribution to the local aid fund 

SHERMAN, M. Gilfix-Glick Disposed 12-11 -95 

Stone Chicopee Dist Ct. 

Prosecution of a staff member for physically abusing a DMR staff member. 
Pre-Trial probation for 6 months 



CARABBA, R. Martinez Disposed 1 1 - 1 3-95 

Stone Fitchburg Dist Ct 

Prosecution of a staff member for physically abusing a DMR patient. 
Continued Without a Finding for 1 8 months 
with condition that he not work with mentally 
retarded persons 

GREANEY, C. Meiklejohn Disposed 11-8-95 

Stone Wareham Dist Ct 

Prosecution of unauthorized practice of nursing. 
Continued Without a Finding for 1 year 



266 



KINGSTON,Paul Brownsberger/Bigelow Plea 11-13-95 

JACKSON,Bruce Crimmins Suffolk Superior 

MDG 

Prosecution of health care fraud under c. 175H and larceny. 
MDG - fines, restitution and community service 
Jackson & Kingston - dismissed criminally 
Civil consent judgments 

ZORILLA,M. Cooper Plea 7-13-95. 

Tpr Brooks Lynn Dist Ct 

Prosecution of unauthorized dentistry 

Continued Without a Finding for 1 year with condition she may not practice 



D. INVESTIGATIONS CLOSED WITHOUT COURT ACTION (33) 



m. REFERRALS to PPB/CREVHNAL (123) 

- received from other parts of the office, from outside state agencies such as Boards 
of Registration, local police, individual consumers, attorneys, public officials, etc 



July '95 


10 


August 


6 


September 


14 


October 


6 


November 


10 


December 


16 


January 


11 


February 


8 


March 


17 


April 


9 


May 


7 


June '96 


9 



this total of 123 referrals to the Division is an increase from the prior year's total of 71. 



IV. OTHER DIVISION ACTIVITES 

Chief Prosecutor Crispin Birnbaum was appointed as a member of the Massachusetts Bar 
Association's Criminal Justice Section Council. She has also assisted in training programs for the 
Flaschner Judicial Training Institute, the Harvard Law School Trial Advocacy Program, the MBA, 
the MCLE, and the Executive Office of Elder Affairs. Ms. Birnbaum also serves as a member of 
the OAG Race and Ethnic Bias Task Force. 

The Division has an ongoing joint investigation with the U.S. Attorney's Office and 
F.B.I, which may result in both state and federal charges. 



267 



Ongoing efforts at bureau-wide criminal training have included programs for attorneys 
and investigators. We also attend the training programs sponsored by the Criminal Bureau. 

The Bureau continues to send assistants to the District Court rotation program which 
enables them to gain valuable courtroom experience to bring back to the criminal cases in the 
Bureau. 

In conjunction with the CID, the Division now has use of a secure evidence room. We 
have also created a Criminal Resource Library, located in the Chief Prosecutor's Office. The 
library includes criminal law books, as well as notebooks with samples of memos and motions, 
etc. 



268 



GOVERNMENT BUREAU 



The Government Bureau provides representation for the Commonwealth and its agencies 
and officials in all types of civil litigation and for employees of the Commonwealth with respect to 
certain civil claims made against them resulting from the performance of their duties. The Bureau 
also provides advice and consultation to officials with respect to legal issues arising in connection 
with their official functions, particularly in instances where such advance consultation may serve 
to prevent unnecessary litigation. 

As in previous years, the Bureau in fiscal year 1996 continued and expanded its efforts to 
develop and maintain close working relationships with agency counsel and to provide them with 
information and advice on matters of broad common interest. A meeting with all agency general 
counsel was held in February, 1996. In February, 1996 we published the sixth issue of the Agency 
Counsel Newsletter, containing reports on legal developments in areas of relevance to agencies of 
the Commonwealth generally. 

The Government Bureau consists of an Administrative Law Division, a Trial Division 
and an Environmental Protection Division. During fiscal year 1996, five attorneys were assigned 
permanently to work in more than one division, and we continued to assign a sampling of cases 
from each division to attorneys in the others, so as to broaden the exposure of the attorneys in both 
to the full range of cases the three divisions handle. In addition, a number of particularly complex 
and significant cases were handled by teams without regard to division boundaries. 

Both the Administrative Law Division and the Trial Division initiate affirmative litigation 
on behalf of state agencies and the Commonwealth and submit briefs amicus curiae in cases 
presenting issues of law affecting the Commonwealth's interests. The Administrative Law 
Division defends suits concerning the legality of governmental operations, particularly those 
seeking injunctive or declaratory relief. The Division is also responsible for legal review of all 
newly enacted town by-laws and for preparation of legal opinions for constitutional officers, heads 



269 



of agencies, and certain other officials concerning issues arising from the performance of then- 
official duties. The Trial Division defends suits seeking damages or other relief for alleged 
wrongful acts of government officials or employees, particularly contract-related disputes, real 
estate matters, torts, civil rights violation, employment discrimination, and environmental damage 
claims. Where statutorily required, the Trial Division also reviews certain contracts, leases, bonds, 
and various conveyancing documents submitted by state agencies for approval as to form. The 
Environmental Protection Division represents the Commonwealth's environmental agencies in 
affirmative litigation to enforce environmental laws and in defensive litigation challenging those 
agencies' regulatory and enforcement activities. 

Affirmative Litigation 
As affirmative litigation, the Government Bureau, in conjunction with the Consumer 
Protection and Antitrust Division, filed a landmark lawsuit against the five major cigarette 
manufacturers and several related entities to recover the Commonwealth's health care and other 
expenditures for smoking-related diseases, including expenditures in the state Medicaid program. 
Commonwealth v. Philip Morris, Inc., et al . The suit alleges, among other things, that the 
cigarette companies and their trade associations are engaged in a conspiracy to mislead the 
Commonwealth and its citizens concerning the addictiveness of nicotine in cigarettes and the 
adverse health effects of smoking. The suit also seeks injunctive relief to, among other things, 
compel the disclosure of cigarette industry research on smoking, health and addiction and to 
require cigarette industry funding of a "corrective" public education campaign. In an historic 
agreement reached in March 1996, one of the defendants, the Liggett Group, settled the claims 
against it in this action and in similar actions filed by four other states. Among other things, 
Liggett agreed to pay these states 2.5 percent of its pretax income for a period of 25 years and to 
accept a number of significant restrictions on its cigarette advertising intended to minimize the 
effect of the advertising on children and teenagers. 



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In addition to the cigarette litigation, the Government Bureau maintained an active docket 
of affirmative litigation in fiscal year 1996 to assert the interests of its state agency clients. In 
Commonwealth v. Federal Deposit Insurance Corporation , the United States District Court ruled 
that the Commonwealth is precluded by federal law from fding deposit insurance claims with the 
FDIC on behalf of the owners of bank deposits that are deemed abandoned under state law, thus 
precluding the state Treasurer's claims for millions of dollars in abandoned deposits. In Michigan, 
et al, v. United States Department of Energy, et al .. the Commonwealth participated with other 
states in an action in which the United States Court of Appeals for the District of Columbia Circuit 
ruled that the United States Department of Energy is obligated under the federal Nuclear Waste 
Policy Act to accept high-level nuclear waste, currently stored on site at nuclear reactors 
throughout the nation, for storage in a central repository by 1998. In Massachusetts Low Level 
Radioactive Waste Management Board v. United States Department of Energy , the United Stated 
District Court ruled that the Massachusetts Low Level Radioactive Waste Management Board did 
not timely meet one of the "milestones" under federal law for the disposal of low level radioactive 
waste and therefore could not collect certain surcharges that had been paid by waste generators. In 
Treasurer v. Middlesex County , the Superior Court ruled that the county must pay assessments 
made by the state Treasurer to cover certain costs incurred by the Public Employee Retirement 
Administration in its supervision of the Middlesex County Retirement System. In Commonwealth 
v. Unisys Corporation , the Bureau filed suit and obtained preliminary relief on behalf of the 
Secretary of State against Unisys Corporation over defects in its design and implementation of a 
statewide computer system for management of voter registration records. In Commonwealth v. 
TLT Construction Co ., the Bureau commenced an action on behalf of the Trial Court and the 
Division of Capital Planning and Operations to recover damages from the contractor, architect and 
others responsible for defects in the design and construction of the renovation of the exterior of the 
Suffolk County Courthouse. 



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Amicus Curiae Briefs 

The Commonwealth's position was adopted by courts in a number of important cases in 
which Government Bureau attorneys filed amicus briefs. In Moakley v. Eastwick , the Supreme 
Judicial Court held that the Art Preservation Act does not apply to work completed before the 
effective date of the Act. In Doe v. Superintendent of Schools of Worcester , the court upheld the 
school superintendent's authority to expel a student for one year for violation of the school's 
weapons policy. Curtis v. School Committee of Falmouth , the Supreme Judicial Court held that a 
condom availability program in the public schools did not violate the parents' liberty interests or 
their rights to free exercise of religion. 

THE ADMINISTRATIVE LAW DIVISION 

The Administrative Law Division has four functions: 
(1) defense of lawsuits against state officials and agencies concerning the legality of governmental 
operations, particularly those seeking injunctive or declaratory relief; (2) initiation of affirmative 
litigation on behalf of state agencies and the Commonwealth; (3) legal review of all newly enacted 
town by-laws; and (4) preparation of legal opinions for constitutional officers, heads of agencies, 
and certain other officials concerning issues arising from the performance of their official duties. 
During fiscal year 1996, significant events occurred in each of these areas. 

During fiscal year 1996, the Division opened 1,452 cases and closed 1,569 cases. Cases 
handled by Division attorneys resulted in 33 reported decisions of the Supreme Judicial Court, 15 
reported decisions of the Massachusetts Appeals Court, 5 reported decisions of the United States 
Court of Appeals for the First Circuit, 2 reported decisions of the United States District Court for 
the District of Massachusetts, and 1 reported decision of the United States Bankruptcy Court for 
the District of Massachusetts. As well, Division attorneys were involved in many cases in those 
courts and in the state trial courts that resulted in unpublished decisions. 



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1. Defensive Litigation . 

The Division spent significant time and resources in fiscal year 1996 defending the 
Commonwealth's administration of federal and state welfare programs. Most significantly, in 
Massachusetts Coalition for the Homeless v. Secretary of EOHHS , the Supreme Judicial Court 
held that the Department of Transitional Assistance did not violate federal or state law in declining 
to use Emergency Assistance funds to enable homeless AFDC families to live in homelike 
settings. In Pvfrom v. Commissioner of DPW , the Appeals Court held that the Department of 
Public Welfare erred in terminating AFDC benefits to a mother who continued to be substantially 
involved in her child's life after the child was placed in the temporary custody of the father. 

In other significant litigation involving children and families, the Supreme Judicial Court 
held, in Gray v. Commissioner of Revenue , that the Department of Revenue could seize a father's 
assets to satisfy his child support arrearages, despite the fact that the father was in compliance with 
a payment schedule previously ordered by the Probate Court. In Care & Protection of Edith , the 
Supreme Judicial Court vacated a District Court gag order enjoining a father from discussing his 
child's care and protection case with the media on the grounds that the order constituted prior 
restraint of the father's free speech rights and was not justified by any compelling state interest. In 
Care and Protection of Vivian , the Supreme Judicial Court held that the federal Parental 
Kidnapping Prevention Act preempted a nonemergency order in a state care and protection 
proceeding. 

The Department of Correction's implementation of a new system for monitoring 
prisoners' telephone calls provoked litigation in both state and federal courts. In Cacicio v. 
Secretary of Public Safety , the Supreme Judicial Court upheld the validity of the regulations 
permitting monitoring and recording of inmate telephone calls as justified by valid penological 
interests and not unconstitutionally impinging on inmates' rights of access to courts and counsel or 
free speech and expression. However, in Langton v. Hogan , the United States Court of Appeals 



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for the First Circuit held that application of these regulations to particular inmates was barred, in 
part, by a previously entered consent decree. 

The Division also handled a large number of appeals arising from the grant or denial of 
unemployment compensation benefits. In Thomas O'Connor & Co. v. Commissioner of 
Employment & Training , the Supreme Judicial Court upheld DET's decisions, in two cases 
involving the same employer, that positive drug tests of a job applicant and employee were not 
sufficient grounds to establish a violation of the employer's policy, for purposes of denying 
unemployment benefits. Other unemployment cases decided during fiscal year 1996 included 
LeBeau v. Commissioner of PET , in which the Supreme Judicial Court held that a claimant who 
voluntarily requested a leave of absence was not entitled to unemployment compensation after she 
changed her mind and unsuccessfully sought to return to her job; White v. Commissioner of PET , 
in which the Appeals Court held that a lump-sum payment to a laid-off employee, which was made 
in return for the employee's release of all claims against the employer, was not remuneration that 
would disqualify the employee from receiving unemployment benefits; Russo v. Commissioner of 
PET , in which the Appeals Court held that an employee could receive training benefits in the same 
year in which he was also receiving federal unemployment benefits; Khodaverdian v. PET , in 
which the Appeals Court held that an employer had good cause for failing to file a timely request 
for separation and wage information; and Still v. Commissioner of PET , in which the Appeals 
Court held that a nursing home employee's conduct in swearing at a patient did not constitute a 
knowing violation of a work rule, for purposes of disqualifying the employee for receipt of 
unemployment benefits. The Supreme Judicial Court granted our petition for further appellate 
review in the Still case. 

Tax cases decided this year included Commissioner of Revenue v. Houghton Mifflin Co. , 
in which the Supreme Judicial Court upheld the Appellate Tax Board's grant of an abatement on 
the ground that a book publisher is a "manufacturing" company for purposes of eligibility for an 



274 



investment tax credit; Cooper v. Commissioner of Revenue , in which the Supreme Judicial Court 
upheld, as nondiscriminatory, the denial of an abatement of state income tax paid on military 
pension benefits; Leger v. Commissioner of Revenue , in which the Supreme Judicial Court held 
that imposition of a tax lien before a judicial hearing did not violate the taxpayer's due process 
rights; and Minkin v. Commissioner of Revenue , in which the Appeals Court reversed an 
Appellate Tax Board decision and held that trusts are not separate entities apart from their 
shareholders for purposes of state taxation. 

In two cases handled by the Administrative Law Division the appellate courts held that 
the assessments in question constituted legitimate fees, rather than illegal taxes. In Nuclear 
Metals, Inc. v. Low-Level Radioactive Waste Management Board , the Supreme Judicial Court 
upheld the assessment of a fee against producers of low-level radioactive waste but found that the 
amount of the fee had been improperly calculated. In Baker v. PEP , the Appeals Court upheld the 
validity of fees filed with notices of intent to develop wetlands in light of the particular benefit to 
landowners on whom the fees are assessed and evidence that the aggregate revenue from fees was 
less than the actual costs associated with the administration of the Wetlands Protection Act. 

Disputes as to eligibility for and calculation of retirement benefits also provoked a 
significant amount of litigation during fiscal year 1996. In appeals from decisions of the 
Contributory Retirement Appeals Board, the appellate courts held that a teacher's out-of-state 
compensation could not be used in calculating retirement benefits (Leary v. CRAB) ; that an 
employee's premature withdrawal of retirement deductions, during a period when the employee 
was also receiving a lump-sum settlement of her workers' compensation claim, did not result in 
the loss of membership in the retirement system (DiNatale v. CRAB) ; that a professor who was 
injured in a fall while returning to her office after lunch at the college cafeteria was not injured 
while in the performance of her duties and therefore was properly denied accidental disability 
retirement benefits (Namvar v. CRAB) ; and that a teacher who was laid off prior to 1979, was 



275 



reemployed after 1979, and had repaid all withdrawn retirement deductions with interest was not 
required to contribute an additional two percent of her salary over $30,000, as required of teachers 
first hired after 1979 (DiGianni v. CRAB) . 

In other retirement-related cases, the Appeals Court held that a retiree was not entitled to 
veterans' retirement benefits because he did not meet the statutory criterion of working for the city 
twice as long as he was not in its employ (Nyhan v. Board of Retirement) ; and the Supreme 
Judicial Court held that a Probate Court order requiring the State Retirement Board to establish an 
account in favor of the former wife of a retiree was beyond the scope of the Board's statutory 
authority and was therefore unenforceable (Early v. State Board of Retirement) . The United States 
Court of Appeals for the First Circuit held, in EEOC v. Massachusetts , that a Massachusetts statute 
preventing state and local employees hired after age 65 from participating in any public employee 
retirement system violated the federal Age Discrimination in Employment Act. In Riva v. 
Massachusetts , the First Circuit held that plaintiffs who began receiving retirement benefits prior 
to the effective date of the Older Workers Benefit Protection Act were precluded by the 
nonretroactivity provision of that Act from challenging a Massachusetts statute reducing 
retirement benefits of employees with less than 10 years of service who were over 65 when they 
began receiving accidental disability benefits. 

The Administrative Law Division handles a variety of healthcare-related cases, several of 
which were decided this past year. In Rate Setting Commission v. Baystate Medical Center , the 
Supreme Judicial Court held that the Division of Administrative Law Appeals ("DALA") had 
jurisdiction to hear a hospital's appeal from the Rate Setting Commission's rate determination and 
remanded the case to DALA to take additional evidence as to costs related specifically to Medicaid 
patients. In another Medicaid case, Mansfield v. Commissioner of DPW , the Appeals Court held 
that the Department of Public Welfare's approval of services provided by a private provider of 
personal care services was sufficient "state action" to entitle the recipient to a due process hearing 



276 



prior to reduction in such services. In two cases the Supreme Judicial Court upheld disciplinary 
actions taken against psychiatrists by the Board of Registration in Medicine: In Aronoff v. Board 
of Registration in Medicine , the Supreme Judicial Court upheld the Board's suspension of a 
psychiatrist who participated in commercial transactions with a patient during the course of her 
treatment; and in Sugarman v. Board of Registration in Medicine , the Supreme Judicial Court 
upheld the suspension of a psychiatrist who violated a court-imposed gag order in a child custody 
case in which the psychiatrist was an expert witness. 

The appellate courts decided several cases this year involving the scope of administrative 
and judicial review of employment actions affecting civil service employees. In Bielawski v. 
Personnel Administrator , the Supreme Judicial Court clarified the limited scope of judicial review 
under G.L. c. 249, § 4, and held that a civil service employee has no property interest in 
promotion. In two other civil service cases, the Appeals Court held, in Police Commissioner v. 
Civil Service Commission , that the Civil Service Commission improperly substituted its judgment 
for that of the police commissioner in modifying a disciplinary sanction, and, in Police 
Commissioner v. Personnel Administrator , that the Superior Court exceeded the scope of judicial 
review by reversing a decision of the Personnel Administrator that a police officer's failure to 
provide proper notice of her absences was reasonable under the circumstances. The Supreme 
Judicial Court granted further appellate review in the latter case. 

This year, the federal courts decided two employment discrimination cases handled by 
Administrative Law Division attorneys. Most significantly, in Chaulk Services, Inc. v. MCAD , 
the United States Court of Appeals for the First Circuit held that an employee's administrative sex 
discrimination claim was preempted by the National Labor Relations Act, because the claim arose 
from the same facts that provided the basis for an unfair labor practice charge brought on her 
behalf before the National Labor Relations Board, and that the District Court therefore erred in 
abstaining, under the Younger doctrine, from assuming jurisdiction over this case. The United 



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States Supreme Court denied our petition for certiorari in the Chaulk case. In McDonald v. 
Massachusetts , the United States District Court for the District of Massachusetts dismissed, for 
failure to state a claim, an employee's claim that the Commonwealth's failure to grant his worker's 
compensation claim violated various state and federal statutes prohibiting handicap discrimination. 

Two first amendment cases decided this year were Volin v. Board of Public Accountancy , 
in which the Supreme Judicial Court upheld, against a first amendment challenge, restrictions on 
advertising by unlicensed accountants; and Boston Herald, Inc. v. Superior Court Department of 
the Trial Court , in which the Supreme Judicial Court opined that the public, via the media, has a 
right of access to arraignments held outside of a courthouse, absent an overriding interest in 
closure, and that any closure must be narrowly tailored to serve such interests. 

Other significant cases handled by the Division that were decided this year include 
Anderson v. Attorney General , in which the Supreme Judicial Court upheld the Attorney General's 
refusal to certify an amendment to an initiative petition that would have materially changed the 
substance of the initiative; County of Barnstable v. Commonwealth , in which the Supreme Judicial 
Court held that counties could be required to contribute to the costs of courthouse maintenance 
where the Legislature had refused to appropriate sufficient funds for that purpose and that the 
court's inherent power did not extend to remedying past shortfalls in such appropriations; and 
Abdullah v. Commissioner of Insurance , in which the United States Court of Appeals for the First 
Circuit upheld the constitutionality of a state statute requiring the Commissioner to set automobile 
insurance rates based, in part, on the geographical territory where the automobile is kept. 

Municipal Law 

The Attorney General's Office is required by statute to review and approve town by-laws 
and amendments to home rule charters. In addition, the Attorney General's Office reviews and 
comments on any inconsistencies between state law and proposed home rule charters and charter 
revisions. These reviews are performed by attorneys in the Municipal Law Unit within the 



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Administrative Law Division of the Government Bureau, with the assistance of attorneys from 
every other bureau in the Attorney General's Office. 

During fiscal year 1996 the Municipal Law Unit reviewed 1,462 by-laws and 38 home 
rule charters, charter revisions, and charter amendments. The Attorney General's Office approved 
1,363 submissions, 93 percent of the total, in whole or in part. The by-laws reviewed included 
584 general by-laws and 878 zoning by-laws. 

Zoning by-laws strike the balance between a property owner's right to use and enjoy 
private property and a municipality's exercise of police power to regulate structures and uses of 
land for the common good. During the past year local attempts to regulate so-called "adult" uses 
were very common. Many towns adopted or revised "planned" or "cluster" zoning to attract but 
control growth. Several communities, apparently faced with booming populations, chose to adopt 
"phased development" by-laws to slow down new residential construction. Also popular were by- 
laws protecting water resources such as aquifers and well sites. 

General by-laws pertain to town governance and the exercise of municipal power. In the 
area of general by-laws, regulation of "details" received attention from several communities. The 
most frequent local choice was to allow police to perform all details. However, some 
municipalities now allow private flaggers at road construction sites. Juvenile curfews, limitations 
on canvassing and soliciting, and loitering were subjects of by-laws approved by several towns. 
Local by-laws limiting the sale and use of tobacco were enacted in every corner of the 
Commonwealth. Many towns adopted or amended general by-laws regulating wetlands. 

In addition to reviewing by-laws, the Municipal Law Unit publishes the semiannual 
Municipal Law Newsletter and responds to telephone calls and information requests from town 
officials and residents, legislators, reporters and state agencies. Attorneys from the Municipal Law 
Unit spoke at meetings of associations of town clerks, town counsel, and town planning and 
zoning boards. 



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Opinions 

The Attorney General is authorized by G.L. c. 12, §§ 3, 6, and 9, to render formal 
opinions and legal advice to constitutional officers, agencies and departments, district attorneys, 
and branches and committees of the Legislature. Formal, published opinions are given primarily 
to the heads of state agencies and departments. Less formal legal advice and consultation is also 
available from the Opinions Coordinator, as is information about the informal consultation 
process. The questions considered in legal opinions must have an immediate concrete relation to 
the official duties of the state agency or officer requesting the opinion. Hypothetical or abstract 
questions, or questions which ask generally about the meaning of a particular statute, lacking a 
factual underpinning, are not answered. 

Formal opinions are not offered on questions raising legal issues that are the subject of 
litigation or that concern ongoing collective bargaining. Questions relating to the wisdom of 
legislation or administrative or executive policies are not addressed. Generally, formal opinions 
will not be issued regarding the interpretation of federal statutes or the constitutionality of enacted 
legislation. 

Formal opinion requests from state agencies that report to a cabinet or executive office 
must first be sent to the appropriate secretary for his or her consideration. If the secretary believes 
the question raised is one that requires resolution by the attorney general, the secretary then 
requests the opinion. 

During fiscal year 1996, the Attorney General issued one formal Opinion, which 
concerned the implementation of enhanced 91 1 telephone service. An additional 79 requests were 
either resolved or declined informally. 

THE TRIAL DIVISION 

In fiscal year 1996, the Trial Division continued to implement a number of initiatives to 
improve the efficiency and quality of its legal representation. For instance, the Division continued 



280 



to place strong emphasis upon early evaluation of cases for settlement, disposition by motion, or 
full litigation. This emphasis has reduced the amount of resources spent on cases that ultimately 
will not go to trial. The Division also created seven practice groups to assist attorneys in 
developing and sharing expertise through training sessions, creation of manuals and model 
pleadings, and hosting outside speakers. The seven groups, which cover the major areas of the 
Division's practice, include Torts, Civil Rights, Employment, Contracts, Real Estate, 
Environmental and Federal Courts. Each division attorney handles cases in more than one of the 
subject matter areas, under supervision of more experienced attorneys where necessary. 

The Division opened 347 cases during the fiscal year, and closed 408. At the end of the 
fiscal year, 1409 cases were pending. The Division received 219 contracts from state agencies for 
approval as to form, of which it approved 1 85 and rejected 28 and had 6 pending at the end of the 
fiscal year. 

Cases involving state contracts continued to provide a significant part of the caseload, as 
major public construction projects proceed. The Division resolved forty-one contracts cases and 
received 46 new cases during the year. At the end of the year, there were 232 contracts cases 
pending, representing a total dollar exposure to the Commonwealth of approximately $ 30 million. 

Many of the contracts cases involved major initiatives of state government. In Converse 
Construction Co. v. Massachusetts Highway Department , the United States District Court denied a 
preliminary injunction that would have prevented implementation of the Commonwealth's 
program for ensuring that a portion of subcontracts on construction projects are awarded to 
minority and women-owned businesses. Suffolk Superior Judge Garsh allowed summary 
judgment in UCANE v. Commissioners of the Department of Public Works , upholding the legality 
of a project labor agreement ("PLA") on the Central Artery/Tunnel Project. 

Division attorneys also appeared before the appellate courts in contract matters. The 
Supreme Judicial Court in Champignv v. Commonwealth , construed a legislative Resolve broadly 



281 



to compensate a business for its loss. The Appeals Court in Machado v. Committee for Public 
Counsel Services held that G.L. c. 21 ID, § 12, requiring CPCS to process bills within thirty days, 
does not give rise to a private action for contract damages. The court also ruled that attorneys do 
not qualify as "commercial vendors" eligible for late payment interest under G.L. c. 29, § 29C. 

Many contract cases involved potential delay in state construction projects due to 
preliminary injunction motions arising out of bid disputes. Roads Corp. v. Commonwealth , 
(denying a losing bidder's motion to enjoin the Massachusetts Highway Department from awarding 
a contract to the apparent low bidder, whose submitted bid included a subcontractor that was no 
longer certified as a Disadvantaged Business Enterprise); GVW, Inc. v. Division of Capital 
Planning and Operations , (denying the plaintiffs motion to enjoin DCPO from awarding the 
contract to another bidder); Pavao Construction v. Massachusetts Highway Department , (denying a 
losing bidder's motion to enjoin MHD from awarding a contract to the low bidder that had cured a 
good faith error in compliance with DBE requirements); ASEC Corp. v. Massachusetts Highway 
Department (MHD did not have the discretion to waive discrepancies in bid documents where 
those discrepancies indicate a "disdain for honesty and a complete lack of integrity"); 
Environmental Waste Technology v. Massachusetts Highway Department (seeking to enjoin the 
award of a $2.8 million contract for emergency response services for unexpected environmental 
hazards at CA/T sites); Ami Municipal Vehicles Division of Natick Auto Sales, Inc., v. 
Commonwealth (denying a losing bidder request for preliminary relief based upon claims that the 
pending purchase by the State Police of 250 new police vehicles was illegal). 

In addition to litigation, the Trial Division advises state agencies and officials on contract 
issues, including questions concerning the formation of contracts, performance, bidding 
procedures, bid protest, contract contents, contract interpretation and other matters. During the 
year, the Division implemented a policy of reviewing contracts only when approval of the 
Attorney General is legally required. The most frequent requests reviewed during the fiscal year 



282 



concerned compliance with the bid laws and rights and remedies of the Commonwealth and other 
parties in the event of failure to perform contractual obligations. Requests for advice and 
assistance came from the Massachusetts Highway Department, Metropolitan District Commission, 
Executive Office of Transportation and Construction, Higher Education Coordinating Council, 
Department of Mental Health, Department of Mental Retardation, Department of Environmental 
Management, State Lottery Commission, Department of Transitional Assistance and Division of 
Capital Planning and Operations. 

In the area of torts and civil rights, the Division opened 233 cases and closed 242. Most 
of the new cases (203) involved allegations of negligence by state agencies or employees. 
Twenty-nine new civil rights and intentional torts cases were opened. 

Eight torts or civil rights cases went to trial before a jury. In Burton v. Commonwealth , a 
jury found for the Commonwealth on a negligence claim brought by a passenger in a truck that 
crashed, after a high speed chase by the State Police and Braintree Police. The jury returned a 
verdict for the Commonwealth in a claim brought by a recreation coordinator, employed by an 
independent contractor, who slipped and fell and suffered a knee injury while supervising and 
participating in an athletic activity in a DYS facility in Barba v. Commonwealth . In Walraven v. 
Commonwealth , the jury found for the Commonwealth in a personal inquiry action arising out of a 
slip and fall on a state owned parking lot. The plaintiff in Grant v. McLaughlin , claimed that a 
Registry of Motor Vehicles police officer used excessive force when he attempted to place him 
under arrest. A jury determined that the officer did commit assault and battery, but awarded only 
one dollar in damages. The plaintiff in Manchester v. Commonwealth , Bristol Superior, 
contended that her fall occurred because she followed her instructor, who warned the class to stay 
together as protection against campus assaults, across unplowed snow. The jury returned a verdict 
for the defendant. After a three day trial in Hunt v. Commonwealth in Brockton before Judge 
Donovan, during which the Commonwealth conceded liability in an automobile accident, the jury 



283 



awarded the plaintiffs a combined total of $1 8,000. The jury awarded the plaintiff, a concert 
violist, in Adams v. Bridgewater State College $1,373,108, which was reduced to the $100,000 
statutory limit. After trial in Sherwood v. Commonwealth , a jury awarded the plaintiff $82,000 in 
an automobile accident case. His wife and two minor children were awarded $12,000 and 
$10,000, respectively. 

Consistent with the division's policy favoring early resolution of cases, many cases were 
resolved by motion before trial, including, among other cases: Diviacchi v. Board of Bar Overseers 
(members of the Board were entitled to prosecutorial immunity from monetary damages arising 
out of the Board's investigation of a complaint against the plaintiff by a former client); Signal 
Corp. v. Nage (statements by the Chair of the House Post Audit Committee were not defamatory); 
Canney v. City of Chelsea (the defendants are state officials under the Chelsea Receivership Act, 
so that claims against them in their official capacity were subject to dismissal); First Financial 
Insurance Co. v. Massachusetts National Guard (the Commonwealth was covered under an 
insurance policy for injury sustained by a spectator at the Anniversary Celebration of the 
Massachusetts National Guard); Williamson v. Fitchburg State College (allowing motion to 
dismiss on all intentional tort counts against the Commonwealth on the grounds that is immune 
from liability for the professor's intentional acts); Gagnon v. Commonwealth (allowing motion to 
dismiss on the grounds that the amendments to the sexually dangerous persons statute did not 
violate the plaintiffs' rights to equal protection or due process and did not constitute ex post facto 
laws); Raisman v. Commonwealth (granting motion for summary judgment, holding that the 
open-ended indemnification provision between the defendants violated Amendment Article 62 of 
the Massachusetts Constitution); Howard v. Commonwealth (the exclusion of discretionary 
functions from the Tort Claims Act under G.L. c. 258, § 10, does not deprive individual 
defendants of the immunity afforded by § 2); Safety Insurance v. Commonwealth (the opening of 



284 



Beldon Bly Drawbridge, which caused a multicar accident, was a road defect that barred all of 
plaintiffs claims). 

Significant settlements in torts cases include Tetiva v. Oleski (two minors and then- 
mother brought an action against the Department of Mental Health and others alleging a therapist 
engaged in a sexual relationship with the mother of a family he was treating. The claim against the 
Commonwealth settled for $65,000; the other defendants paid a total of $185,000. The claim 
against the Commonwealth in Kaleski v. Commonwealth was settled for $25,000. 

Division attorneys appeared in the appellate courts in several torts cases. The Appeals 
Court affirmed the award of summary judgment to Suzanne Bump, former state representative in 
the defamation case of Benoit v. Bump because the statements at issue were non-actionable 
opinions based on disclosed, non-defamatory facts. In Goveia v. Westfield State College , a 
student at the College alleged that she was raped and assaulted in a dormitory by other students as 
a result of the college's negligence in enforcing its alcohol and security policies. The Appeals 
Court affirmed the grant of summary judgment to the college based on the discretionary function 
exception to the Tort Claims Act and the public duty rule. 

The Division also appeared in numerous civil rights cases in the federal courts. In the 
case of McClure v. Bunker Hill Community College , the Federal District Court granted the 
defendants' motion for summary judgment, finding that the College disciplined the plaintiff based 
on his own misconduct and that the hearing the College provided to the plaintiff satisfied due 
process requirements. The U.S.D.C. in Weiner v. Board of Registration of Psychologists allowed 
the defendants' motion to dismiss on the grounds that the individual members of the Board, who 
acted in a quasi-judicial capacity, were entitled to absolute immunity from his claims. The court in 
Robinson v. Divenuti granted our motion to dismiss on Eleventh Amendment grounds. 

Employment litigation accounted for 27 new cases. Several cases reached the appellate 
level, with uniformly successful results. In Hamlin v. Department of Social Services , the 



285 



Massachusetts Appeals Court affirmed the award of judgment notwithstanding the verdict to the 
defendant in this handicap discrimination action because the plaintiff was not a "qualified 
handicapped person" as that term is defined in chapter 151B. The Supreme Judicial Court denied 
further appellate review. In Davis v. State Lottery Commission , the First Circuit Court of Appeals 
upheld the District Court's determination on summary judgment that the plaintiff failed to 
establish a prima facie case of employment discrimination. 

At the trial court level, in Smith, et al. v. Massachusetts Rehabilitation Commission , the 
U.S. District Court granted our motion for summary judgment based on the plaintiffs' failure to 
establish a prima facie case and the employer's legitimate nondiscriminatory reason for the adverse 
employment action. In Fratus v. Department of Education the U.S.D.C. held that the 
Massachusetts Department of Education was not an "employer" within the meaning of Title VII 
where it was exercising its regulatory powers to preserve quality vocational education. The 
Superior Court in Cook v. Commonwealth held that c. 15 IB is the exclusive remedy for 
employment-based sexual harassment and that sovereign immunity barred plaintiffs claim against 
the Commonwealth for damages under the Privacy Act. The division's only employment 
discrimination trial in fiscal year 1996 (Haddocks v. Department of Mental Health) settled on the 
fourth day of trial, after plaintiff had rested, for $105,000 which was roughly equivalent to the 
claim for back pay. 

Trial Division attorneys handled a variety of real estate cases, many of which involved 
petitions for the assessment of damages resulting from land acquisitions by eminent domain. 
Sixty-seven new eminent domain cases were opened in the Division in this fiscal year. The 
Division opened 106 and closed 115 real estate cases. During the fiscal year, the Division 
disposed of 54 land damage cases, 5 after jury trial and 49 by settlement. The disposition of these 
cases resulted in savings to the Commonwealth of more than $ 40 million, which represents the 
difference between the amounts claimed and the amounts paid. 



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The Commonwealth's agencies acquire land for numerous reasons, including highway 
construction, recreation and parks, agricultural and conservation restrictions and easements. When 
required by statute, Division attorneys provide advice on these and other real estate matters and 
approve as to form deeds, rental agreements, pro tanto releases, general releases, taking orders and 
other conveyance documents involving the Commonwealth. Trial Division attorneys also 
represent the Commonwealth in all petitions for registration of land filed in the Land Court. 
Agencies involved in such real estate matters include the Massachusetts Highway Department, 
Metropolitan District Commission, The Department of Environmental Management, the 
Department of Environmental Protection, the Department of Food and Agriculture, the 
Department of Fisheries, Wildlife and Environmental Law Enforcement and the Division of 
Capital Planning and Operations. 

Real estate projects also include several special initiatives. In the first proceeding 
initiated by the Attorney General's Abandoned Housing Task Force, Commonwealth v. Theophile 
Pierre , Chief Judge Daher of the Boston Housing Court allowed the Commonwealth's petition to 
enforce the State Sanitary Code and for appointment of a receiver for a Dorchester property 
located in the C-l 1 Safe Neighborhood Initiative ("SNI"). The Commonwealth entered into 
settlement agreements with the new owner of three other Dorchester properties in the C-l 1 SNI to 
bring the properties up to code compliance within five months. In another project, the 
Metropolitan District Commission has identified approximately 80 encroachments on its parkland 
along the Charles River in Newton, Waltham, and Watertown. These encroachments vary from 
homeowners extending their lawns to companies having parking lots on state land. Members of 
the Division, assisted by the Environmental Protection Division, are assisting in the effort to 
resolve issues raised by the encroachments. 

Owners of shoreline property in Hooper v. Town of Rockport , brought a declaratory 
judgment action in the Land Court to determine whether either the public or the town had a right 



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to use the Atlantic Path, which crosses their private property. At the Court's invitation, the 
division filed a motion to intervene on behalf of the public. After trial, the court found that neither 
the town nor the public has any rights to use the plaintiffs property. 

At the appellate level, the Division prevailed in all of its four real estate cases decided 
during the fiscal year. In Ackerley Communications v. Commonwealth , the court affirmed the 
lower court's grant of summary judgment for the Commonwealth because the plaintiff held a mere 
license, which is not compensable under the eminent domain statute. The Appeals Court affirmed 
summary judgment for the defendants in Samuels v. Executive Office of Transportation and 
Construction , noting that the plaintiffs failed to produce any evidence that the purchase price was 
below fair market value. In Nelson v. Commonwealth , an appeal from the dismissal of damages 
claims based on the destruction of portions of plaintiffs' beachfront after a 1987 storm in Chatham, 
the court granted our motion for summary disposition and application for attorneys' fees. In 
Assistant Recorder of the North Registry District of Bristol County v. Spinelli, Individually and as 
Trustee , the Appeals Court upheld the Land Court's determination that a trust is ineligible for 
homestead protection, that the Assistant Recorder has standing as "a party in interest," and that the 
Land Court had authority to correct a certificate of title in order to maintain the integrity and 
accuracy of registered land records. Assistant Recorder of the North Registry District of Bristol 
County v. Spinelli . In Langone v. Commonwealth , the state succeeded in a Superior Court 
eviction proceeding brought against a company that occupied Commonwealth land under 
construction for the new Suffolk County Courthouse. The Commonwealth prevailed on summary 
judgment in the Superior Court in Wilson v. Commonwealth , which challenged the state's denial 
of permits for protective seawalls for waterfront properties in Chatham. 



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THE ENVIRONMENTAL PROTECTION DIVISION 

The Environmental Protection Division (EPD) serves as litigation counsel on 
environmental issues for various state agencies, particularly those within the Executive Office of 
Environmental Affairs. EPD handles the Commonwealth's civil litigation to enforce 
environmental protection programs established by state statutes and regulations, including laws 
governing air pollution, water pollution, water supply, waterways, wetlands, hazardous and solid 
waste. Based on the Attorney General's broad authority to protect the environment of the 
Commonwealth, EPD initiates and intervenes in state and federal litigation, and participates in 
administrative proceedings before federal agencies on significant environmental issues. EPD 
defends lawsuits challenging the actions of state environmental agencies and the legality of state 
environmental laws. 

During fiscal year 1996, EPD handled enforcement proceedings leading to judgments 
requiring future payments to the Commonwealth of $39,741,253. These are figures for penalties 
and cost recovery awarded in fiscal 1996, whether or not actually paid in fiscal 1996. Actual 
payments, received by EPD, in fiscal year 1996, were $244,920 for civil penalties and $1,618,369 
for hazardous material cost recovery, for a total of $1,863,289. Other cases resulted in court 
judgments requiring private parties to undertake costly cleanups-a savings of millions of dollars 
for the Commonwealth. 
I. State Enforcement 

One of the most important functions of EPD is to bring litigation to enforce state and 
federal environmental statutes. In the past fiscal year, EPD handled numerous major enforcement 
cases, including the following: 

A. Air Pollution 

Significant air pollution matters during the fiscal year included Commonwealth v. Coastal 
Oil New England (As part of a consent decree, Coastal will pay a penalty of $175,000 after 



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allegedly violating a number of state air pollution laws at its gasoline loading facilities in Revere); 
Commonwealth v. Gentex Optics, Inc . (An eyeglass lens manufacturer, in Dudley, must pay 
$610,000 in penalties and other relief after allegedly releasing high levels of materials that 
contribute to the formation of smog and the destruction of the upper ozone layer); Commonwealth 
v. Refrigerator Truck Body, Inc . (We obtained a consent judgment that requires Refrigerator 
Truck, an auto body shop in Woburn, to control its air emissions, comply with hazardous waste 
management requirements, cease alleged dumping of solid waste, and pay a $25,000 civil penalty); 
Commonwealth v. Parkway Garage and Commonwealth v. Resse's Auto Service Station (We filed 
consent judgments requiring the defendants to pay $10,000 in civil penalties for allegedly 
operating gasoline filling stations without the vapor recovery equipment required under the Clean 
Air Act); and Commonwealth v. J.J. Barafo Inc., et al . (In this Environmental Strike Force 
asbestos case, $26,000 in penalties were paid after pipes allegedly containing asbestos insulation 
were illegally removed from an industrial building) 
B. Water Pollution/Water Supply 

The division handled a number of water polution cases. These include Commonwealth v. 
Lacet, where the court entered a consent judgment against the owner and operator of a Mattapan 
auto repair facility that allegedly violated state law by allowing collected gasoline and oil to 
discharge into the MWRA sewer system, which is connected to Boston Harbor. The judgment 
requires the defendants to maintain the facility's gasoline/oil separator in good working condition 
and periodically to report their efforts to the MWRA for compliance review. 

In a case filed under the Clean Waters Act, the town agreed to the entry of a final 
judgment requiring the replacement of failing septic tank systems. Commonwealth v. Town of 
Essex . The town is also required to eliminate alleged unlawful connections to the town storm 
drains and implement additional cost-effective means of reducing the level of pollutants in the 
storm drains. In Commonwealth v. Town of Oak Bluffs and Commonwealth v. Town of Tisbury , 



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the towns had agreed, in 1994, to the entry of a final judgment in which they were to work 
together to solve their alleged septage and wastewater problems. Subsequent to the entry of the 
final judgment, the towns decided not to work together. The towns agreed to the entry of a second 
modified final judgment that puts the towns on a schedule to solve their own wastewater and 
septage problems. 

In early June, there were alleged raw sewage breakouts occurring at the Heritage Mobile 
Home Park in Salisbury in violation of the Clean Waters Act and Title 5 of the State 
Environmental Code. The breakouts were occurring in very close proximity to trailer homes and 
the street because the leaching field at the trailer park had failed. The owner of the trailer park was 
allegedly violating orders of the Salisbury Board of Health to pump out the septic system to avoid 
sewage overflows. We obtained a temporary restraining order and a preliminary injunction against 
the trailer park owner and its president compelling the owner to regularly pump out the septic 
system to avoid overflows and to cease using the failed leaching field. Commonwealth v. Heritage 
Mobile Home Park . Similarly, in an Environmental Strike Force case, we sued the owners and 
operators of a Westport restaurant for operating a failed septic system in violation of the 
Massachusetts Clean Waters Act and Title 5 of the State Environmental Code. Commonwealth v. 
Windward Food Service Co., Inc. d/b/a/ Moby Dick Wharf Restaurant . The septic system allegedly 
overflowed into the Westport River, causing the closure of sensitive shellfishing beds. In a 
consent judgment, the defendants agreed to pay $40,000 in civil penalties, install new septic tanks, 
and to study and install a fully complying Title 5 septic system, or, if that proves infeasible, to 
install "tight tanks" as an alternative. 

The Division obtained rulings in two additional water pollution cases. Commonwealth v. 
Alouette Associates (In this Title 5 case, the owners of a shopping plaza paid a $30,000 penalty for 
allegedly allowing a failing septic system to dump raw sewage into a parking lot and agreed to 
pump the system once a day to prevent overflows); Commonwealth v. Town of Marshfield (The 



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court dismissed the town's counterclaim against the Commonwealth, ruling that the state's 
groundwater discharge requirements were not "unfunded local mandates" under Proposition 2 Vi. 
Our motion for partial summary judgment is currently pending before the court). 
C. Hazardous Materials 

EPD brings lawsuits against responsible parties to remediate contamination caused by oil 
or hazardous materials, including litigation to recover costs incurred by the Commonwealth when 
it undertakes cleanup actions. In addition, EPD brings enforcement actions to require proper 
management, storage and disposal of hazardous wastes and to collect penalties for violations. In 
the last fiscal year, EPD handled the following major hazardous waste cases. 

In United States and Commonwealth v. Charles George Trucking Co .. the court ruled that 
the state and federal governments did not act arbitrarily or capriciously in selecting remedies for 
the Charles George Landfill superfund site. Once cost issues are resolved, the defendants will be 
ordered to pay the governments' unreimbursed cleanup costs associated with the remedies. In a 
Superfund case, Commonwealth v. Federal Pacific Electric Co ., the Commonwealth and the 
United States sought $40-80 million in reimbursement of clean-up costs from six former 
owners/operators of a manufacturing facility in Norwood which is allegedly contaminated with 
polychlorinated biphenyls ("PCBs"). In August 1995, the Court entered a consent decree resolving 
liability of the three defendants in the amount of $40 million, to be paid out of the indemnification 
proceeds for which the Court had previously found the other defendants liable. The Court found 
the consent decree fair, reasonable, and consistent with the goals of CERCLA. In Commonwealth 
v. Cambium Corporation , we filed suit against Cambium, a casket manufacturing company, 
alleging that it violated G.L. c. 21C and endangered the public by piling drums of ignitable 
hazardous waste. We also alleged that Cambium violated the Massachusetts Clean Air Act by 
emitting volatile organic compounds that contribute to the depletion of the ozone layer. Cambium 
agreed to reduce its generation of air pollutants and hazardous wastes and to run an ad warning 



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other furniture manufacturers to obey environmental laws. Cambium will also pay a civil penalty 
of $20,000 now, and up to $40,000 in additional penalties if there are further violations over the 
next two years. The court granted the Commonwealth's request, in Commonwealth v. Sak 
Recycling Co ., for a preliminary injunction requiring the owners and operators of a South Boston 
junkyard to take immediate steps to protect nearby residents and workers from alleged exposure to 
PCB contamination. The order prohibits ongoing operations at the yard, including sifting and 
screening of junk, and requires the repair and maintenance of the fence surrounding the site. In 
Commonwealth v. Creative Chemical , a G.L. c. 21, 21C, and 2 IE case, the defendants agreed to 
pay a $75,000 penalty for their alleged illegal treatment of hazardous waste and disposal of highly 
acidic wastewater into the Town of Palmer sewer system. The defendants were required to 
perform an investigation and testing of their facility for any contamination. In another 
G.L. c. 21E case, Commonwealth v. Mobil Oil of Massachusetts, Inc ., Mobil agreed to pay a 
$150,000 penalty for its alleged failure to notify the Department of Environmental Protection of a 
potential imminent hazard condition caused by leaking underground storage tanks at its New 
Bedford gas station. A nearby residence suffered significant impacts from the fumes. The 
Commonwealth has filed for court approval of consent judgments in Commonwealth v. Turtle 
resolving its claims against all defendants in this 2 IE cost recovery action. Under the terms of the 
settlement, the defendants agreed to pay approximately $60,000 of the Commonwealth's costs, and 
not to oppose the execution of the Commonwealth's lien on the site. In an Environmental Strike 
Force case, Commonwealth v. Air Liquide America Corp .. we alleged that a North Grafton 
gas-repackaging company, failed to notify DEP that it had released water contaminated with PCBs 
into soil at its facility. The judgment entered in this case requires $25,000 in penalties, as well as 
the clean up of contaminated soil. 

We also filed suit against the owner of a gasoline station in Rockport. Commonwealth v. 
John Beaudette Inc . The complaint seeks an injunction requiring the owner to comply with a 



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cleanup order issued by the Department of Environmental Protection, penalties for alleged 
violation of the order, and recovery of the Commonwealth's cleanup costs. Finally, under an 
agreement entered in Bankruptcy Court, Harrington & Richardson , a Gardner gun manufacturer, 
will pay $600,000 towards the clean-up of a site that was allegedly contaminated by chemicals 
used in the manufacturing of firearms. 

D. Wetlands 

Among the wetlands cases resolved this fiscal year, Commonwealth of Massachusetts v. 
Wayne Williams involves the alleged illegal alteration of wetlands to construct commercial 
cranberry bogs, without obtaining an order of conditions under the Wetlands Protection Act. The 
court required the debtors/defendants to restore three acres of wetlands and the court also required 
the payment of a $50,000 civil penalty, plus an additional $25,000 in the event of failed 
performance under the order. In Commonwealth of Massachusetts v. Kenneth Chobot , jointly 
handled by CPAD and EPD, we obtained a $109,000 default judgment for alleged illegal timber 
cutting in protected wetlands, and violations of G.L. c. 93A, the Consumer Protection Act. The 
judgment includes restitution for elderly consumers and civil penalties for consumer protection, 
wetlands protection, and timber harvesting violations. The judgment also enjoins the defendants 
from breaching their contracts and violating the state's environmental laws. In Commonwealth v. 
Blackstone-Chicago Corporation , we alleged that a real estate developer was responsible for 
wetlands damage due to erosion at its subdivisions in Northbridge and Uxbridge. Blackstone 
agreed to take steps to help restore the damaged wetlands, and to pay a civil penalty of $25,000. 

E. Solid Waste 

We filed an action against the defendants for operating an alleged illegal solid waste 
dump in Brockton. Commonwealth v. Hercules Building Wrecking Co., Inc . The defendants 
consented to an interim order prohibiting them from accepting debris at the site and transferring 
assets. In Commonwealth v. Sam White & Sons. Inc ., Coastal Energy Services contracted to 



294 



demolish the Cushing Hospital and subcontracted with MRP Site Development to dispose of the 
debris, consisting of wood, brick, and concrete. MRP allegedly dumped the debris in a gravel pit 
in Medway operated by Sam White, which is not licensed for refuse disposal. The three 
companies have agreed to pay fines totaling $35,000 for illegal disposal of demolition debris. 

Homart Development Co., the developer of the Natick Mall and Shoppers World in 
Framingham and Walsh Brothers, Inc., the general contractor at the Natick Mall, agreed to pay 
civil penalties of $200,000 and $50,000 respectively for alleged violations of the state Solid Waste 
and Clean Air Acts arising out of the removal and disposal of asbestos-containing material at the 
sites. Commonwealth v. Homart Development Co . 
F. Pesticides 

Commonwealth of Massachusetts v. Terminix : This case involved alleged unlawful 
applications of residential pesticides in violation of the Massachusetts Pesticide Control Act, 
including by failing to train the company's pesticide applicators. We obtained partial summary 
judgment and a judgment by consent, requiring immediate payment of $146,950. 

II. Clean State Initiative 

A. Clean State Report to the Legislature 

Pursuant to G.L. c. 12, § 11D, we filed a report to the Legislature evaluating the progress 
of the Clean State Program since its initiation nearly three years ago. Executive Order 350, which 
grew out of the Attorney General's concern that state agencies were not in compliance with the 
environmental laws, directed state agencies (authorities opted in) expeditiously to identify, 
prioritize and remediate environmental problems. Roughly 1300 problems were identified, 300 of 
which were classified as "priority matters" requiring correction by the end of FY 1997. The report 
examines the identification of problems, funding, quarterly reporting and progress and makes a 
number of recommendations for steps that should be taken. 



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B. Other Actions of EPD in Conjunction 
With the Clean State Initiative 

In our first judicial action taken under the Clean State Initiative, we filed a 

complaint, stipulation and order under which the MBTA agreed to take immediate measures to 

clean up alleged petroleum contamination at the Fellsway bus garage in Medford. Commonwealth 

v. Massachusetts Bay Transportation Authority : Leaks of thousands of gallons of diesel fuel and 

heating oil have occurred at the garage, resulting in contamination of ground water and surface 

water in the area. 

The Attorney General, DCPO, and DEP forged an agreement to demolish the South Bay 
Incinerator and gave community groups an opportunity to participate in the process. The project 
was the result of a collaborative effort by the A.G.'s Office, U.S.E.P.A., the City of Boston, and a 
number of community groups. 

I. Low Emissions Vehicle Litigation/Federal Clean Air Act 

Over the last three years, we have been defending Massachusetts' right to adopt the 
California auto emission standards, both as a defendant in a suit in Massachusetts and as an amicus 
in a suit in New York. MVMA v. New York . The car companies' key argument has been that the 
federal Clean Air Act prohibits states from adopting the California emission standards without 
simultaneously mandating the special gasolines that California requires. According to the car 
companies, this would cause them to make production changes that would amount to a "third 
vehicle" prohibited by the Act. A federal District Court judge in New York initially invalidated 
the New York program on this basis, but later reversed course and ruled in New York's favor on 
summary judgment. On January 10, 1996, the Second Circuit upheld this ruling. 

IV. Facility Siting and Licensing Proceedings 

The Commonwealth intervenes in facility siting and licensing proceedings when it 
determines that intervention is necessary and appropriate to protect the public health or the 



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environment. In the past year, EPD has been involved in ongoing proceedings in opposition to the 
siting of several power plants. 

In the past year, the Attorney General succeeded in defeating two proposals to build new, 
coal-fired power plants in southeastern Massachusetts. In the matters of: Eastern Energy 
Corporation and the Silver City Energy Limited Partnership , before the Energy Facilities Siting 
Board and the Supreme Judicial Court. The Attorney General opposed both plants because a large 
regional energy surplus showed that they were not needed, and because the plants would produce 
much dirtier air than other energy options. As a result of this effort, EPD obtained an agreement 
that stopped the development of the 300-megawatt coal-fired power plant proposed for New 
Bedford by the Eastern Energy Corp. ("EEC"), and that required the Silver City Energy Limited 
Partnership ("SCELP"), developers of a 150-megawatt silver coal-fired plant proposed for 
Taunton, to reduce significantly that plant's anticipated air emissions and energy prices. 

A. Siting Reform 

During the past year, the Attorney General's Office has actively and vigorously 
participated in the siting statute reform process embarked upon by the Energy Facilities Siting 
Board. We have participated in large group discussions designed to critique the EFSB's proposed 
model statute and to design one that better meets the needs of all competing interests as the 
Commonwealth moves into an era of competition in the electric industry. We have been engaged 
with all stakeholders and members of the legislature, in which various proposals have been floated 
for review. 

B. Energy Issues 

Early in 1996, EPD led a coalition of attorneys general from four northeastern states filing 
comments with both the Environmental Protection Agency and the Federal Energy Regulatory 
Commission. Our comments urged these federal agencies to require mitigation of air pollution as 
a condition for allowing electric restructuring. EPD was active throughout the year on the state 



297 



level as well. We sought to protect the environment throughout numerous "roundtable" 
discussions and negotiating sessions, and worked with other state agencies to reach a common 
position for the state government. We filed comments urging the Massachusetts Department of 
Public Utilities to restructure local electric generation in a way that reduces rather than increases 
harmful air pollution. 

C. Appliance Standards 

The Attorney General is leading an effort by the Attorneys General of Connecticut, Rhode 
Island, and Maine to support passage of federal appliance energy efficiency standards. If 
implemented, the new standards would, over the next twenty years, save consumers about $20 
billion in energy costs nationally and avoid the need to run eight 500-megawatt fossil fuel-burning 
power plants, thus reducing harmful air pollution. 

V. Defensive Cases 

One of the critical functions of the Attorney General's Office is the defense of lawsuits 
challenging the regulatory and enforcement actions of state environmental officials and agencies. 
These cases involve numerous challenges to state permitting decisions, as well as challenges to the 
legality of state environmental regulations. Hootstein v. Coxe (The court granted our motion for 
summary judgment in this action against the Secretary of the Executive Office of Environmental 
Affairs and Northfield Solid Waste Recovery, Inc., challenging the Secretary's decision to require 
no further environmental review of NSWR's proposed solid waste and sludge recycling and 
composting facility). Haines v. Town of Amesbury , Appeals Court (We argued an appeal on 
behalf of DEP as intervener defending the Superior Court's decision to vacate a 1991 consent 
judgment and related orders that required Amesbury to remove and replace an allegedly defective 
weir, where compliance with the Consent Order would have required the Town to drastically lower 
the River's water level and would have caused severe harm to the Town's own water supply and 
1 .2 miles of wetlands); Papia v. Massachusetts Department of Environmental Protection and Town 



298 



of Andover Conservation Commission (In an action for judicial review pursuant to G.L. c. 30A, 
the court upheld DEP's denial of a wetlands permit to fill wedands to construct a proposed 
subdivision in Andover); Nantucket Islands Land Bank v. Secretary of Executive Office of 
Environmental Affairs (In this action for review of the Secretary's decision that the Land Bank's 
proposal to expand a golf course into 30 acres of globally rare habitat was impermissible, we 
negotiated a settlement in which the Land Bank will draft a revised proposal for the Secretary's 
consideration. The revised proposal avoids the sensitive area almost entirely and includes 
proposals by the Land Bank for other environmentally beneficial projects on the island as further 
mitigation.); Conservation Law Foundation v. Secretary of Executive Office of Environmental 
Affairs (The court dismissed on jurisdictional grounds this challenge to the Secretary's decision 
permitting the MBTA to raise fares without first preparing an environmental impact report.); 
Conservation Law Foundation v. Boston Air Pollution Control Commission and Commissioner 
David Struhs, Department of Environmental Protection : (CLF brought suit against BAPCC and 
Commissioner Struhs in federal district court alleging violations of the Clean Air Act. We 
opposed CLF's motion for summary judgment against BAPCC. CLF contends that BAPCC 
violated the Boston Parking Freeze by issuing a permit to construct a parking lot in Chinatown). 

VI. New Legislation 

We actively supported the Rivers Bill, which would protect the Commonwealth's river 
banks from over-development and would help protect the rivers themselves from pollution. (The 
bill was subsequently enacted in large part due to our active role in final negotiations.) We also 
actively opposed various problematic audit privilege and takings bills. 

VII. Speaking Engagements, Awards and Events 

Assistant Attorney General Betsy Harper addressed a group of bankers/lenders in 
Pittsfield about the contamination, in Pittsfield and surrounding towns, allegedly caused by 
General Electric's release of PCBs into the environment and the potential liability of bankers and 



299 



lenders who foreclose on contaminated property. They also discussed the Brownfields Initiative 
and statutory exemptions to liability under G.L. c. 2 IE. 

The Environmental Protection Division was invited by the Massachusetts Association of 
Conservation Commissions to speak at two workshops at MACC's annual meeting on March 9, 
1996 at Holy Cross College in Worcester. We addressed workshops on wetlands enforcement and 
on agricultural use of conservation land. The sessions were well attended by town conservation 
commissioners and commission staff, environmental agency personnel, and other interested 
parties. 

Vm. Other 

On May 24, 1996, we issued a Covenant Not to Sue in an Administrative Consent Order 
to the Massachusetts Government Land Bank. In re: The Massachusetts Government Land Bank : 
The Land Bank is charged with the acquisition, operation, and redevelopment of Fort Devens. The 
Army transferred Fort Devens to the Land Bank on May 9, 1996. Fort Devens is allegedly 
contaminated with hazardous materials and is a federal facility under CERCLA. In order to 
facilitate the redevelopment of Fort Devens, we agreed to give the Land Bank a covenant outside 
of the Clean States Initiative. This agreement imposes certain cleanup obligations on both the 
Land Bank and its successors, in exchange for the covenant. 

The Commonwealth along with other states alleged that the ads of the American Plastics 
Council ("APC"), part of APC's "Take Another Look at Plastics" ad campaign, was deceptive 
because of failure to put claims about the rate of plastics recycling in context of the current 
availability of such recycling to consumers. Environmental Marketing Multi-State Task Force - 
American Plastics Council Agreement : Multi-State Attorney General Task Force Settlement. APC 
trade association paid $10,000 to each of the 11 participating Task Force states. APC also agreed 
to various restrictions on future environmental advertising. 



300 



During the fiscal year, the division also pursued the Brownfields Initiative. Our 
hazardous waste laws inadvertently place significant impediments on the reuse of contaminated 
land. As a result, previously developed, urban "brownfields" lie unused, while pristine farmland 
and other open space get developed. The Attorney General has been at the forefront of efforts to 
try to change this. Our office drafted legislative proposals that would provide significant liability 
relief to new developers of "brownfields" and we proposed a pilot program that would be targetted 
at the distressed areas most in need. 

The Attorney General and attorneys general of 37 states and 1 1 governors called on 
President Clinton and Congressional leaders to oppose pending proposals that would weaken 
states' roles in environmental clean-ups of federal facilities and cut environmental restoration 
budgets. In the letter, the attorneys general state their support of streamlining and other reforms, 
but cautioned the Congress and the Clinton Administration not to compromise the health and 
safety of citizens. 

EX. Significant Hearings, Amicus Briefs, etc. 

We prepared an amicus brief supporting the respondents in Meghrig v. KFC Western, 
Inc ., in the United States Supreme Court. The issue is whether a citizen can recover the costs 
incurred in responding to an imminent and substantial endangerment to health or the environment 
under the Citizens Suit provision of RCRA. We argued that restitution is available; 13 states 
joined us as amici. 

We also filed an amicus brief on behalf of the plaintiffs, a group of citizens who own 
property within the floodplain of the Housatonic River, and in opposition to General Electric's 
motion for summary judgment. Church v. General Electric Co . We argued that the continual 
re-deposition of alleged PCB -contaminated sediments on plaintiffs property caused by the periodic 
flooding of the Housatonic constitutes a continuing nuisance under Massachusetts law, and 
plaintiffs' claims are therefore timely. The Commonwealth owns large tracts of land which are 



301 



also affected by this phenomenon, so we possess a direct interest in having the law develop in this 
fashion. 

Two amicus briefs involved opposing strategic lawsuits against public participation 
("SLAPP" suits). In Triandafilou v. DeMoulas , we filed an amicus brief in the Supreme Judicial 
Court arguing that a not-for-profit corporation is authorized to file a special motion to dismiss 
under the Anti-SLAPP Suit Act. In Baker v. Parsons , Superior Court, the defendant was sued for 
allegedly petitioning the Secretary to require environmental review of the plaintiffs proposed pier 
project. The plaintiff filed a motion to dismiss this action under the new Anti-SLAPP suit law. 
We filed an amicus brief in support of that motion. The Court granted our motion as we urged it 
to do. 



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THE WESTERN MASSACHUSETTS DIVISION 

The Western Massachusetts Division of the Office of the Attorney General, located in the 
State Office Building at 436 Dwight Street, Springfield, is responsible for legal matters arising in 
Berkshire, Franklin, Hampden, and Hampshire Counties. The Western Massachusetts Division is 
staffed by eleven asssistant attorneys general, three civilian investigators, four paralegals, three 
Massachusetts State Police Officers, and additional support staff. One attorney and two 
investigators assigned to the Medicaid Fraud Unit also are part of the staff. 

The Western Massachusetts Division, part of the Office of the Attorney General 
Executive Bureau. Assistant Attorneys General assigned to the Western Massachusetts Division 
defend the Commowealth in administrative law, contract, eminent domain, civil rights, and torts 
cases. In fiscal year 1996, sixty one new "defensive cases" were opened and eighty seven were 
resolved. At the beginning of fiscal year 1996, there were one hundred twenty eight "defensive 
cases" open; at the end of fiscal year 1996, there were one hundred and two. These figures 
represent a thru-put rate of 125%. 

In addition, the Western Massachusetts Division prosecutes pro-active civil rights, 
consumer protection, and criminal cases. This year, the consumer protection division succeeded in 
putting an unscrupulous charitable fundraising operation out of business and filed civil complaints 
against unlicensed home improvement contractors, automobile dealers, and others. The criminal 
bureau is involved in a joint investigation with the United State's Attorney's Office and has 
investigated and prosecuted consumer fraud, unemployment fraud, insurance fraud, and other 
white collar crimes. 

One of the most significant changes to the Western Massachusetts Division this year was 
the implementation of an "Intake Unit." This unit handles and investigates consumer complaints 
and evaluates cases for possible criminal or civil action. 



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The Western Massachusetts Division will continue to provide the residents of western 
Massachusetts with access to their state government and will continue to provide state 
governmental agencies with the highest quality legal representation. 



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No. 95/96-1 
June 12, 1996 

Kathleen M. O' Toole, Secretary 
Executive Office of Public Safety 
One Ashburton Place, 21st Floor 
Boston, MA 02108 

Dear Secretary O'Toole: 

You have requested my opinion whether the Statewide Emergency Telecommunications 
Board (the "Board") has authority, in implementing Enhanced 911 ("E-911") service, pursuant to 
G.L. c. 6A, §§ 18A-F (1994 ed.), to designate private safety agencies (i.e. , privately owned and 
operated ambulance companies) as secondary public safety answering points ("PSAPs").' Your 
question arises because the statutory provision governing PSAPs expressly provides that public 
safety agencies (i.e. , divisions of state or municipal government) shall serve as primary PSAPs; the 
statute is silent, however, as to whether public safety agencies similarly must serve as secondary 
PSAPs or whether private safety agencies can serve that function. For the reasons discussed 
below, it is my opinion that the relevant statute does not preclude the Board from approving 
private safety agencies as secondary PSAPs. 

Pursuant to G.L. c. 6A, § 18B(b), the Board is responsible for coordinating and 
implementing E-91 1 service. Enhanced 91 1 is "a service consisting of telephone network features 
provided for users of the public telephone system enabling such users to reach a public safety 
answering point by dialing the digits 911. Such service directs 91 1 calls to appropriate public 
safety answering points by selective routing based on the geographical location from which the 



1 Secondary PSAPs receive E-911 calls only when they are transferred from the primary 
PSAP (which must be a public safety agency such as a police or fire department or other division 
of state or municipal government that provides emergency services) or on an alternative routing 
basis. 



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calls originate and provides the capability for automatic number identification and automatic 
location identification." G.L. c. 6A, § 18A. 

Each municipality within the Commonwealth that certifies to the Secretary of the 
Commonwealth that it accepts the provisions of St. 1990, c. 291, establishing the Board and E- 
911, "shall establish, staff, and operate, in conjunction with one or more other municipalities or by 
itself, a public safety answering point on a twenty-four hour a day, seven days a week basis, in a 
manner and according to a schedule to be approved by the board." G.L. c. 6A, § 18D(a). 

Pursuant to G.L. c. 6A, § 18A, a public safety answering point is defined as "a facility assigned the 
responsibility of receiving 91 1 calls and, as appropriate, directly dispatching emergency response 
services or transferring or relaying emergency 911 calls to other public or private safety agencies". 2 
See also G.L. c. 6A, §18C(a). 

While the statute thus contemplates that the services ultimately provided in response to an 
E-91 1 call may be performed by either "public or private safety agencies," 3 it nonetheless requires 
that a "public safety agency" serve as the primary PSAP. In particular, G.L. c. 6A, 



2 The statute distinguishes between three types of public safety answering points or 
PSAPs: primary PSAPs, secondary PSAPs, and ringing PSAPs. A primary PSAP is distinguished 
from a secondary PSAP in that a primary PSAP "is the first point of reception of a 91 1 call," 
while a secondary PSAP "receives 91 1 calls only when they are transferred from the primary 
public safety answering point or on an alternative routing basis when calls cannot be completed 
to the primary public safety answering point." G.L. c. 6A, § 18A. Both primary and secondary 
PSAPs are equipped with automatic number identification and automatic location identification 
displays. "Automatic number identification" ("AM") is defined as an E-91 1 service capability 
that allows for the automatic display of the seven digit number used to place a 91 1 call, while 
"automatic location identification" ("ANI") refers to an E-91 1 service capability that allows for 
the automatic display of information relating to the geographical location of the telephone used to 
place a 91 1 call. Id. Finally, a ringing PSAP does not have capability to receive ANI or ALI; a 
ringing PSAP is "equipped for receipt of voice communications only," and it "receives 911 
calls that are transferred from the primary public safety answering point." Id. 

3 A private safety agency is defined by statute as "any entity, except for a municipality or 
a public safety agency, providing emergency police, fire, ambulance or medical services." 

G.L. c. 6A, § 18A. A public safety agency is defined as "a functional division of a municipality 
or the state" which provides the same services as are provided by a private safety agency. Id. 



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§ 1 8D, governing the statewide plan to be adopted by the Board for implementation of E-911, 
requires that the plan include "[a] designation within each enhanced 91 1 system, of the 
municipalities and the public safety agencies within such municipalities, to serve as the primary 
public safety answering points. In all cases, the recommendation for the primary public safety 
answering point locations shall be for existing public safety agencies. . . ." G.L. c. 6A, 
§ 18D(c)(3)(emphasis added). The question you have raised, however, is whether a public safety 
agency must also serve as the secondary PSAP or whether a private safety agency may serve that 
function. 

In contrast to the foregoing provisions governing primary PSAPs, the statute does not 
contain language specifically requiring public safety agencies to serve as secondary PSAPs. The 
provision governing requirements for the implementation plan adopted by the Board merely 
provides, with respect to secondary PSAPs, that "[t]he board shall also evaluate the need for 
secondary public safety answering points in municipalities which have requested them." G.L. c. 
6A, § 18D(c)(3). The section governing the Board's powers and duties similarly provides that 
applications for secondary PSAPs shall be reviewed and approved by the Board. G.L. c. 6A, 
18B(b). 

I am aware of no case authority that sheds light on the question you have raised. 
However, interpreting statutory language itself, guided by general principles of statutory 
construction, I am of the view, for the reasons discussed below, that the statute does not preclude 
the Board from approving an application by a municipality for a private service agency to serve as 
a secondary PSAP. Two principles of statutory construction are of particular relevance here. 
First, where the Legislature "has employed specific language in one paragraph, but not in another, 
the language should not be implied where it is not present." Beeler v. Downey , 387 Mass. 609, 
616 (1982). In addition, legislative intent should be ascertained from the "ordinary and approved 
usage of the language, considered in connection with the cause of its enactment, the mischief or 



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imperfection to be remedied and the main object to be accomplished . . . ." Board of Education v. 
Assessor of Worcester , 368 Mass. 511, 513 (1975) (citations omitted). 

As noted above, the Legislature expressly provided that public safety agencies should 
serve as primary PSAPs. See G.L. c. 6A, § 18D(c)(3). The fact that the Legislature did not 
similarly specify that public safety agencies should serve as secondary PSAPs suggests the 
Legislature's intention that secondary PSAPs may be served by either public or private 
safety agencies. This interpretation is supported by the operational standards adopted by the Board 
for the E-91 1 system, set forth at 560 C.M.R. § 2.06 (1993). In particular, one standard, entitled 
"Non-Municipal Agencies Authorized as Public Safety Answering Points," provides that "[o]nly 
municipal public safety agencies or groups of municipalities may operate Enhanced 9-1-1 PSAPs 
or authorize Enhanced 9-1-1 PSAPs to be operated, with the approval of the Board ." 560 C.M.R. 
§ 2.06(l)(f)(emphasis added). The latter language suggests the Board's understanding that the 
statute does not preclude municipalities from designating "non-municipal" (i.e. , private) safety 
agencies as secondary or ringing PSAPs, with the Board's approval. The Board's latitude to 
approve private safety agencies as secondary PSAPs also is consistent with the Board's broad 
statutory authority to "coordinate and effect the implementation of enhanced 911, and administer 
its service in the commonwealth," G.L. c. 6A, § 18B(b), including the specific authority to review 
and approve applications for secondary PSAPs, G.L. c. 6A, § 18B(b), and to "evaluate the need for 
secondary public safety answering points." See G.L. c. 6A, § 18D(c)(3). 

Moreover, considerations of public safety, which underlie G.L. c. 6A, §§ 18A-F, support 
a reading of the statute that would enable private safety agencies to serve as secondary PSAPs. In 
this regard, it is my understanding, based on information provided by your office and by the Board, 
that precluding private safety agencies from serving as secondary PSAPs and allowing them to 
serve only as ringing PSAPs could, in certain circumstances, lead to delays in the provision of 
emergency services to the person placing a 91 1 call. For example, where a 91 1 call placed to a 



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primary PSAP is transferred to a private ambulance company that has been designated only a 
ringing PSAP (not a secondary PSAP) and, thus, is not authorized to be equipped with ANI and 
ALI, if the caller were unable to provide necessary information concerning his or her telephone 
number or address (or if the private company inadvertently recorded the information incorrectly), 
the private ambulance company would be required to call back the primary PSAP to obtain the 
information needed to respond to the emergency, resulting in a delay in the provision of emergency 
services. 4 

On the other hand, if the private ambulance company itself were designated a secondary 
PSAP in the foregoing example, it would be equipped with ANI and ALI and that address/location 
information would be displayed instantaneously on the company's telephone screen. The 
important public safety interest in ensuring prompt responses to E-91 1 calls favors an 
interpretation of the statute that would enable private safety agencies to serve as secondary PSAPs. 

In response to a concern expressed by the Board and others regarding the potential 
misuse of ANI and ALI information by private safely agencies designated to serve as secondary 
PSAPs, I note that the operational standards governing PSAPs appear to address that issue. In 
particular, 560 C.M.R. § 2.06(l)(j) provides that "[subscriber information provided in accordance 
with the 9-1-1 system shall be used only for the purpose of responding to emergency calls or for 
use in any ensuing investigation or prosecution" and that PSAPs "must provide protection and 
confidentiality for ANI [automatic number identification] and ALI [automatic location 
identification] data." (This prohibition on misuse of subscriber information is repeated in G.L. c. 
166, § 14A(d)(1994 ed.), governing the provision of E-91 1 service to PSAPs by telephone 



4 1 note that the operational standards adopted by the Board require that personnel 
responding to a call verify the location of the emergency with the 91 1 caller, see 560 C.M.R. 
2.06(3)(a)(3); and that the Board has indicated that it interprets the standard to require the 
primary PSAP to remain on the line until the ringing PSAP has verified the information. The 
foregoing standard, nevertheless, may not eliminate all potential delays, particularly in the 
situation where the ringing PSAP incorrectly records information concerning the location. 



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companies.) Finally, the same regulation requires that "[e]ach PSAP shall establish personnel 

security clearance standards that are acceptable to all public safety agencies served by the facility." 

In addition, the Board requires those municipalities that contract with private safety agencies and 

seek to designate those agencies as secondary PSAPs to incorporate protections into the terms of 

their contracts in order to address additional concerns about the possible misuse of subscriber 

information. 5 

In sum, based on my review of the relevant provisions of G.L. c. 6 A, §§ 18A-F, I 

conclude that the statute does not preclude the Board from approving a private service agency as a 

secondary public safety answering point. 

Sincerely, 

Scott Harshbarger 



5 The Board's "Required Contract Guidelines for Municipalities Utilizing Private EMS 
Providers," adopted in January, 1996, require municipalities to enter into written agreements with 
private ambulance providers in order to utilize and authorize such providers to receive transferred 
911 voice calls and ANI/ALI data. The Guidelines provide, among other things, that the written 
agreements must require the private provider to comply with laws and regulations concerning site 
security and security of data, as well as other relevant Massachusetts general laws. The 
Guidelines further provide that the municipality and Board, in consultation with one another will 
have authority to terminate delivery of ANI/ALI data to a private provider for various reasons, 
including inappropriate use of that data. 



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