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

Public Document 



No. 18072 



©V^ ^/ym/m<>nu>ea/^ o/QMVaM<icAu6etti' 



ADDENDUM TO 



REPORT 



of the 



ATTORNEY GENERAL 



for the 



Year Ending June 30, 1998 




\TioN OF THIS Document Approved by Philmore Anderson hi. State Purchasing Agent. 

274-800-DOCUPIUNT-10/99-7000044 Printed on Recycled Paper 

o 



CIVIL RIGHTS AND CIVIL LIBERTIES DIVISION 



MASSACHUSETTS CIVIL RIGHTS ACT 

The Civil Rights and Civil Liberties Division continues to enforce aggressively 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 1998, the Division's mission to deter and prevent hate crimes resulted in the 
issuance of nine preliminary injunctions or final judgements by the Superior Court against 17 
defendants, where it was alleged that the defendants had interfered with the rights of 24 residents 
of Massachusetts on the basis of their race, sexual orientation, gender, religion or national origin. 
The Division obtained final injunctive relief, after trial, against one defendant who the court 
found engaged in bias-motivated threats and a physical assault against an elderly Jewish man. 
Five final judgements by consent were entered by the Superior Court against nine defendants 
who allegedly had interfered with the rights of Massachusetts residents on the basis of race, 
national origin, sexual orientation or gender. Two more civil rights injunction cases, based on 
allegations of race and national origin bias, were filed in FY 1 998 and are awaiting hearings on 
the Division's requests for preliminary injunction. These two cases involve five defendants. In 
total, more than 32 in-depth civil rights investigations of possible MCRA violations were 
conducted by the Division. 

Bias Motivated Civil Rights Cases 

The Division prevailed in its first landmark MCRA case involving allegations of civil 
rights violations on the basis of gender in 1994. The Division has boldly continued its campaign 
to protect women from hate motivated violence in dating relationships by obtaining a judgement 
by consent fi-om the Middlesex County Superior Court against a man with an alleged history of 
violence and abuse against women. In the second case of its kind in Massachusetts history, the 
state's civil rights act was used to protect the most fundamental and basic civil rights of women. 
The injunction prohibits the defendant ft-om engaging in gender based threats or violence against 
both the three women specifically-named in the Division's court complaint and any other woman 
with whom he may have a dating relationship with in the future. In total, the Division 
participated in 1 1 investigations of alleged gender-bias motivated abuse against women. 

Another striking example of the Division's strong response to violations of the MCRA 
occurred in Commonwealth v. Abend, where the Division proceeded to a final trial on the merits 
in the Superior Court. The Division obtained final injunctive relief against a Brighton man 
whom the court found assaulted, threatened and harassed his 76 year old Jewish, Russian 
immigrant neighbor while shouting anti-Semitic and anti-Russian epithets. The Superior Court 
concluded that the defendant's conduct was motivated by a bias toward Russian Jewish 
immigrants. The court held that the victim's fundamental civil right to live peaceably and enjoy 



housing accommodations, free from threats, intimidation and harassment was violated when the 
defendant shouted, threatened and assauhed his elderly Jewish neighbor. 

In fiscal year 1998, the Division continued to obtain injunctive relief against gay bashers, 
demonstrating its continued commitment to combating hate crimes directed at individuals based 
on their actual or perceived sexual orientation. In one of the four MCRA cases pursued by the 
Division in FY 98 to address anti-gay bias, the Division brought the first known case in 
Massachusetts in which the Internet was used in the commission of an alleged hate crime. The 
Division acted quickly to send the message that it will not tolerate the Internet becoming a new 
weapon for targeting victims and committing hate crimes. In this case, the 'Division obtained a 
preliminary injunction against two men who allegedly used an Internet gay chat room for the 
purpose of luring a man to their town, where they brutally assaulted him. During the alleged 
attack, which left the victim severely injured, the defendants repeatedly used anti-gay language 
and threatened to kill the victim if he reported the crime to the police. 

The Western Mass. office, working with the Division, obtained a preliminary injunction 
against a defendant who interfered with a families' right to use public accommodations free from 
threats, intimidation or harassment. The defendant allegedly directed profanities and racial 
epithets at two black children who were dining in a restaurant, in Sturbridge, with their white 
parents. The defendant is barred from further threatening, harassing or intimidating any 
individual or group of individuals due to race or ethnicity. 

Anti-Asian Bias 

In fiscal year 1998, the Division obtained two final judgements by consent against five 
alleged perpetrators, and conducted five additional in-depth investigations into matters involving 
alleged hate crimes targeted at the Asian-American community. In one case the Division 
obtained a final judgement by consent against a teenager who allegedly attacked a 67-year-old 
non-English speaking Asian woman living in Maiden. An additional case alleging an assault 
motivated by anti- Asian bias is awaiting the Division's request for a preliminary injunction 
hearing. 

The Division engaged in extensive outreach and education efforts to various communities 
in Massachusetts with large numbers of Asian- American residents, with particular focus on 
Quincy, Maiden, Lowell, Revere, Fall River and Boston. These efforts were led by the 
Division's liaison to the Asian-American community in Massachusetts. The Division's liaison 
spoke at many different venues including at numerous community meetings. The liaison also 
appeared as a guest to discuss civil rights issues on a Maiden Cable Access Television program 
titled "Asian Spectrum," as well as on Boston Neighborhood Network News, and the Cambridge 
Community Access Cable. 

In March of 1998, the Asian- American Lawyers Association of Massachusetts (AALAM) 
presented its 1997 Community Service Award to Attorney General Harshbarger and the Civil 



Rights Division. The award was granted to the Attorney General and the Division in recognition 
of significant and sustained efforts in helping to achieve justice and addressing issues which 
confront the Asian- American community in Massachusetts. Through this award, the Attorney 
General and the Division were formally recognized for their leadership in combating anti-Asian 
violence; promoting the use of mediation in community-based conflicts, and addressing housing 
discrimination-particularly against immigrants. 

Civil Rights in the Schools 

The Division vigorously continued its extensive efforts to protect both the safety and the 
civil rights of students attending schools in the Commonwealth. As part of these efforts, the 
Division has provided training and education to students, teachers and administrators on hate 
crimes and discrimination, as well as sexual, racial, national origin and religious harassment in 
the schools. 

In fiscal year 1998, the Division swiftly responded to more than eight allegations of hate 
or bias motivated conduct by youngsters which occurred within the Massachusetts school system. 
In most cases, the Division conducted investigations and worked with the schools to resolve the 
conflicts and to prevent future recurrence. However, in one important case, the Division 
obtained a civil rights injunction against two 14 year old boys who allegedly wrote threatening 
notes riddled with expressions of hate to their middle school social studies teacher in Amesbury. 
The notes exhibited strong anti-Semitic, anti-gay and anti-female bias. One note directed a death 
threat to the teacher. 

Another important step in the Division's efforts to fight hate crimes and to prevent civil 
rights violations in the schools was its drafting of a brochure for middle and high school students 
in the Commonwealth titled "Erasing Hate, A Guide to Your Civil Rights in School, Your Rights 
to be Free From Discrimination, Harassment and Hate Motivated Violence." The brochure 
informs students about the laws which protect their civil rights and provides them information 
about the resources available to help them if they believe their civil rights have been violated. 
The brochure was distributed to over 1 500 school superintendents, principals, community service 
organizations and civil rights advocacy groups throughout the Commonwealth. The Division 
received a tremendously positive response, accompanied by requests for over 50,000 additional 
copies. Due to the overwhelming response to the brochures, the Division is publishing 95,000 
copies of a revised version of the "Erasing Hate" brochure in FY 1999 to distribute to schools 
throughout the Commonwealth. 

In fiscal year 1998, television was another medium utilized by the Division to 
communicate information about civil rights and hate crimes to students and school systems. The 
Massachusetts Corporation of Educational Telecommunications invited the Division Chief to 
serve as a panel member for a live television show on how students and school staff should 
address hate crimes in the schools. The program was watched in a number of middle school and 
high school classrooms throughout Massachusetts, as well as in a number of states in the United 



States. 

Hate Crime Training of Community and Civil Rights Advocates 

On July 8, 1998, the Division helped to organize and co-sponsored a day-long civil rights 
training of staff from Boston area civil rights and community advocacy groups to enhance the 
partnership between law enforcement and victim communities to prevent hate crimes and fight 
discrimination in Massachusetts. Along with staff from the Division, participants and co- 
sponsors of the training included the Anti-Defamation League, Asian- American Resource 
Workshop, Coalition for Racial Justice, GLAD (Gay and Lesbian Defenders), La Raza, the 
Massachusetts English Plus Coalition, the National Conference, and the Urban League. The 
chairman and staff from the Massachusetts Commission Against Discrimination also actively 
participated in the training. 

On April 29, 1998, the Division Chief served as a panel member in a session titled "Hate 
Crimes: Current Issues and Trends," at the Massachusetts Armual Victim Rights Conference, 
sponsored by the Massachusetts Office of Victim Assistance. 

CIVIL RIGHTS AND POLICE 

In a collaborative effort to promote civil rights, assist the police, and provide departments 
with technical assistance, the Division continues to offer and provide an extensive amount of 
civil rights training to law enforcement and to police departments covering issues of civil 
liability, sexual harassment, racial and cultural awareness and hate crimes. 

The Division, along with the Community Disorders Unit of the Boston Police 
Department, the Boston Housing Authority and the Suffolk County District Attorney's Office 
sponsored a three-day civil rights/hate crime training in the City of Boston. Over 400 
participants attended from the Boston Police Department, the Boston School Public Safety 
Office, the MBTA Police Department, the Boston Housing Authority Police Department along 
with BHA managers and staff, as well as prosecutors, victim witness advocates and staff from the 
Suffolk County District Attorney's Office. Division staff served as program presenters, panel 
members and facilitators at the training. The Division Chief also participated in the Bristol 
County District Attorney's Office Civil Rights Conference as one of the introductory speakers 
and moderated two panel discussions titled "Hate Crimes and Law Enforcement" and 
"Community/Police Relations". The conference was held at Southeastern New England School 
of Law, located in North Dartmouth, MA. Also, a Division member conducted an MCRA 
training at the Somerville Police Department as part of a program titled "Cops and Kids". 

The Division continues to be consulted by departments to assist them in their internal 
civil rights investigations as well as to investigate allegations of police misconduct. The 
Division has closely worked with departments to take remedial steps when credible evidence is 
found which substantiates civil rights complaints. 



HOUSING DISCRIMINATION 

The Division continues to enforce effectively 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 1998, the Division fought discrimination in housing by filing 14 new 
actions in Superior Court. These cases involved allegations of discrimination based on race, 
familial status, source of income and disability. Eight pending cases were favorably resolved 
through court approved consent agreements during this period. Settlements included broad 
injunctive and affirmative relief provisions, ai> well as compensatory damages to the 
complainants. Collectively, over $28,000 in monetary damages were provided to complainants 
and a total of $8,000 donated to various fair housing organizations. 

Through these and other cases the Division has filed, the Attorney General hopes to 
modify landlord and 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. 

In its most important housing case, the Superior Court and the U.S. Department of 
Housing and Urban Development approved a comprehensive model agreement between the 
Division and the owners and managers of a 330-unit federally subsidized apartment complex 
located in the North Shore, entered into to enhance housing opportunities for African-American 
and Hispanic families at the complex. The Division had alleged that since 1988, the defendants 
engaged in advertising, outreach, marketing, tenant selection and placement policies which had 
the effect of significantly reducing the number of African- American and Hispanics applying for 
and being accepted into housing at the complex. The consent judgement requires the defendants 
to engage in affirmative oufreach, advertising and marketing efforts to atfract eligible black and 
Hispanic applicants and to place them into the defendants' apartment complex. It also 
establishes a reconsideration process for past rejected African-Americans and Hispanic 
applicants, designates an affirmative action coordinator to promote compliance with the 
agreement and contains a provision for the Division to perform fair housing training of its staff 
In addition, the defendants provided three African American complainants with monetary relief 
and donated $5,000 to a non-profit housing placement program which aims to place iimer city 
families in surrounding suburbs. Since September 1997, as a result of the steps taken by the 
owners and management of the complex to implement the consent judgment, 17 new black and 
Hispanic families have been placed into the complex. 

Members of the Division also actively participated in the United States Department of 
Housing and Urban Development New England and Mid- Atlantic regional Fair Housing 
Conference in August of 1997, attended by staff from numerous state anti-discrimination 
enforcement agencies, as well as housing discrimination attorneys and policy makers. The 
Division Chief facilitated a round table discussion among the attorneys on the use of creative 



affirmative remedies and fair housing enforcement. 

EMPLOYMENT DISCRIMINATION I 

In fiscal year 1996, the Attorney General established an Employment Discrimination 
Project in the Division to focus on systemic employment discrimination practices. The Project 
investigates allegations of 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. 

In fiscal year 1998, the Project continues to have a significant impact on employment 
practices in the Commonwealth. The Division closely monitored and enforced the historic, court 
enforceable Equal Opportunity Agreement (EOA) entered in February 1 997 after an arduous 
investigation and more than six months of negotiations with the Massachusetts Bay 
Transportation Authority (MBTA) and 26 of its 27 labor unions. The Agreement intended to end 
years of alleged violations of state and federal fair employment laws at the MBTA while 
protecting T workers ft-om fijture discrimination, harassment and retaliatory conduct. On April 
28, 1998, the Attorney General released a one-year status report on the MBTA's effort to 
implement the 1997 court enforceable agreement. Some of the findings, outlined in the status 
report, which were a result of the Division's enforcement efforts over the first year of the 
Agreement include: 

1) Equal Employment Opportunities: The Agreement requires that the T post all 
permanent job vacancies below the level of executive management personnel. The T's posting ol 
non-executive level job openings as well as announcement of jobs through a telephone job line 
resulted in an increase in advancement opportunities for current employees and a hiring increase , 
for minority and women candidates. For example, minorities comprised 45.5% (106 out of 233) 
and women 36.5% (85 out of 233) of newly-hired employees. However, full compliance with the 
Agreement did not occur as the T failed to post some positions required by the Agreement to be 
posted. 

2) Complaint Investigation Procedures: The T drastically modified its internal 
complaint process to improve protection of workers' civil rights by establishing new 
investigative standards, developed a detailed written investigatory protocol, extensively trained T 
investigators in professional development and fair employment practices, instituted an informal 
complaint resolution process, and significantly increased the investigatory budget and 
investigatory staff 

3) Supervisory Responsibility: Under the Agreement, each supervisor is accoimtable for 
identifying, addressing and reporting civil rights violations and complaints of violations. The 
Division found that supervisors in general reported alleged civil rights violations and forwarded 
complaints to OD for investigation. However, in a few instances supervisors failed to report 



possible violations- specifically several instances of racially hostile graffiti. 

4) Anti-Discrimination/Harassment Training: Under the Agreement, the Division 
required that managers and supervisors receive training on their rights and responsibilities under 
the civil rights laws. In fiscal year 1998, the Division played a leading role in the training of 
157 of the T's senior managers, emphasizing the special role and responsibilities of managers in 
preventing and reporting discrimination, harassment and retaliation at the T. Pursuant to the 
terms of the Agreement, the T trained all of their supervisory employees on their rights and duties 
under the Agreement and state and federal anti-discrimination laws. 

5) Compliance Monitoring: The T achieved major progress in developing a 
computerized monitoring system and expects to have a fully operational system in FY 1 999. In 
the interim, the T employed a manual monitoring procedure to identify patterns of 
discrimination. The T also took action to address and respond to an identified pattern at one job 
site. 

In Fiscal Year 1998, the Division's Employment Discrimination Project co-authored, 
with the state of Arizona, and filed an amicus brief on behalf of Massachusetts, Arizona and 12 
other states in the United States Supreme Court in the case titled Wright v. Universal Maritime 
Corp . The Attorney General argued that discrimination claims should not be subject to 
mandatory arbitration clauses in a collective bargaining contract, but rather should be permitted 
to be litigated in a public judicial forum. The Division argued that it is the legal right of 
unionized workers to bring discrimination claims in a public forum, where States have a strong 
public interest in identifying systemic discrimination that may exist in the workplace. The case is 
awaiting oral argument before the Supreme Court in the fall 1998 term. 

ATTORNEY GENERAL'S TASK FORCE ON RACE AND ETHNIC BIAS 

In response to the report issued in September 1 994 by the Supreme Judicial Court 
Commission on Race and Ethnic Bias in the Courts, the Attorney General requested that the 
Division lead the office's response to the report's recommendations. Since 1994 the Division 
Chief has co-chaired the Attorney General's Task Force on Race and Ethnic Bias, while Division 
staff serve as active members. The Task Force has over 45 members, which include a diverse 
cross section of staff from throughout the office. The Task Force is committed to racial and 
ethnic equality in the workplace and in the judicial system and consists of subcommittees 
including Cultural and Linguistic Barriers to the Justice System, Education and Training, 
Sentencing, and Jury Pools. Each subcommittee's mission is to eliminate bias in its focus area, 
and convenes regularly. In FY 1998, the Task Force developed programs and initiatives for the 
office, the legal community and the court system. 

In November of 1997, the Division helped the office prepare the Task Force's Interim 
Report and distributed it widely. The Report detailed the numerous and significant 
accomplishments of the Task Force since its inception in April 1995. Since the spring of 1995, 



the Task Force has accompHshed the following: organized diversity training for all staff; 
developed an officewide program on effective interviewing techniques; sponsored a provocative 
public forum, led by the Attorney General, exploring the role race plays in the criminal justice 
system; expanded efforts by the office to attract qualified minority and women vendors; 
translated an informational brochure on court procedures for victims of domestic violence into 
seven languages other than English; published, and regularly updated, a comprehensive list of all 
staff proficient in a language other than English available to interpret for members of the public 
who contact our Office for assistance; supported legislation to provide the Trial Court with 
expanded resources for foreign language interpreters, centralization of interpreter services, and 
standardization of certification requirements for interpreters; proposed to the Massachusetts 
Sentencing Commission that it establish a data collection system to monitor sentencing 
disparities based on race and ethnic origin; advised the Jury Commissioner for the 
Commonwealth, as well as city and town officials, on procedures to better identify residents to 
ensure wider cross sections of communities to comprise jury pools; and conducted extensive 
educational outreach forjudges and attorneys on recognizing and eliminating cultural and 
linguistic barriers in the courts. 

In addition, in the summer of 1997, as part of the Task Force's efforts, the Division Chief 
co-authored an article entitled "The Role of Counsel in the Courts of Addressing Foreign 
Language and Cultural Barriers at Different Stages of a Criminal Proceeding," published in the 
Western New England Law Review, Volume 19, Issue 1 . The article surveys the contours of the 
right to an interpreter and the impact of cultural differences in the context of specific court 
determinations in the United States. To ensure constitutional guarantees, the article strongly 
encourages prosecutors and defense counsel to raise and address these issues at all stages of 
criminal proceedings. 

NATIONAL CIVIL RIGHTS INITIATIVES 

National Association of Attorneys General fN.A.A.G.'s) National Civil Rights Working 
Group 

The Division Chief continues to serve as national chair of N.A.A.G.'s Civil Rights 
Working Group consisting of representatives of state Attorneys General throughout the country. 
The Working Group's goal is to enhance the cooperative relationship between the states and the 
U.S. Department of Justice in civil rights enforcement. Division members serve on N.A.A.G.'s 
Bias Crime, Mortgage Lending, Housing, Employment Discrimination and Disability Rights 
Task Forces to address national policy and enforcement issues in these areas. 

Attorney General Reno's National Working Group on State and Local Law Enforcement 
Hate Crime Training 

In FY 1998 the Chief of the Division served as one of four co-chairs of Attorney General 
Janet Reno's "National Working Group on State and Local Law Enforcement Hate Crime 



Training." He contributed to the Working Group's design and development of four standardized 
national hate crime training curricula for state and local law enforcement. The four training 
curricula are being designed for a multilevel law enforcement audience, for patrol officers, for 
investigating officers and for law enforcement managers and supervisors. The four curricula are 
anticipated to be published in September 1998. 

National Civil Rights in Schools Working Group 

The Division Chief serves as national co-chair of N.A.A.G. and the Office of Civil 
Rights, U.S. Department of Education's Civil Rights In Schools Working Group. The Working 
Group is drafting a practical guide to inform school administrators around the country, including 
Massachusetts, on how to create comprehensive civil rights protection programs and policies in 
their schools. The guide will be completed in the fall 1998. 

N.A.A.G. Annual Civil Rights Conference 

Division members organized, attended and participated in the fourth annual N.A.A.G. 
Civil Rights Conference, held in Washington, DC on March 5th-7th, 1998. The Division Chief 
led a session on how to create a comprehensive civil rights protection program for students in 
schools, and also introduced a portion of the new "state-of-the-art" state and local law 
enforcement hate crime training curriculum during the Bias Crime Task Force session. 

White House Conference on Hate Crimes 

On November 10, 1998, President Clinton sponsored a day-long "White House 
Conference on Hate Crimes" to address hate crimes in the United States and to emphasize law 
enforcement/community partnership and strategies in combating hate crimes. About 300 law 
enforcement officials, educators, community and civil rights activists from throughout the 
country were invited to attend the conference. The Division Chief attended and participated in a 
session chaired by Attorney General Janet Reno on effective law enforcement response to hate 
crimes. 

Massachusetts Forum on Hate Crimes 

On November 10, 1998, the Attorney General organized and co-sponsored, along with the 
Governor's Hate Crimes Task Force, the Anti-Defamation League, Boston National Voices and 
the Greater Boston Civil Rights Coalition a hate crime forum titled "Combating Hate Crime for 
the Year 2000," at Northeastern University, to parallel the work at the White House Conference 
on Hate Crimes. 

The Attorney General and Division staff participated in this forum to enhance efforts to 
prevent and address hate crimes in Massachusetts. 



Federal Hate Crimes Legislation 

On March 4, 1998 Attorney General Harshbarger urged the United States Senate to 
strengthen the federal law against hate crimes to include protection for people who are victimized 
because of their gender, sexual orientation or disability. The Division coordinated the Attorney 
General's effort to obtain support of the legislation from other state Attorneys General across the 
country. As a result of the Division's efforts, 21 other state attorneys general joined Attorney 
General Harshbarger in a letter to the Chairpersons of the Judiciary Committee of the United 
States Senate, enthusiastically endorsing Senate Bill No, 1 529, the Hate Crime Prevention Act of 
1998. The proposed amendments to the federal hate crime law would supplement state hate 
crime laws and provide broader redress for victims of bias-motivated crimes. The bill also 
proposes to allow federal funding for state and local programs designed to combat hate crimes 
committed by juveniles, and authorizes consideration of increases in penalties through federal 
sentencing guidelines for adults who recruit juveniles to commit hate crimes. 

Federal Employment Non-Discrimination Act 

In the July 29, 1997 letter to Congress, Attorney General Harshbarger and 14 other 
Attorneys General urged Congress to pass the federal Employment Non-Discrimination Act 
(END A), which would ban job discrimination against lesbian and gay Americans. Division staff 
coordinated the Attorney General's efforts to obtain support for this legislation from other state 
Attorneys General. 

First proposed in 1994 and re-introduced on June 10, 1998 by a bi-partisan coalition of 
lawmakers, ENDA prohibits employers, employment agencies and labor unions from making 
hiring, firing, promotion or compensation decisions based on an individual's actual or perceived 
sexual orientation. Attorney General Harshbarger began seeking support for ENDA from his 
colleagues while serving as president of the National Association of Attorneys General. 

National Enforcement Initiative on Employment Discrimination 

On November 10, 1997, N.A.A.G. and the Equal Employment Opportunity Commission 
entered into a Memorandum of Understanding (N.A.A.G./EEOC MOU) to enhance federal-state 
communication, cooperation, and coordination in the enforcement of the civil rights laws 
prohibiting discrimination in employment. The Division Chief served as N.A.A.G.'s lead 
negotiator with the EEOC and was the primai-y drafter of the MOU. Under the terms of the 
MOU, EEOC and the state Attorneys General will implement designated mechanisms for 
communication and coordination on developing issues and cases. EEOC and the Attorneys 
General have also agreed to develop joint enforcement initiatives. 



10 



DISABILITY RIGHTS PROJECT 

Ensuring Equal Access To Private Businesses 

The Disability Rights Project of the Division reached an agreement with MCI 
Telecommunications Co. which will ensure that hearing-impaired customers using its 
telephone relay service are afforded equal access to telecommunication services. 
Although communication access often does not receive the same attention as 
architectural access, equal communication access is essential for people with hearing 
impairments and other communication disabilities. Telephone relay services provide a 
critical link between people who are deaf or who have hearing or speech impainnents 
and the people with whom they communicate by phone. The settlement agreement 
resolves a lawsuit filed by four disability rights groups, which the Office of the Attorney 
General joined, alleging that MCI's relay system had provided substandard service, 
including garbled messages, breaches of confidentiality, lack of verbatim transmission, 
and other problems. The agreement imposes a rigorous set of detailed performance 
standards that must be met under the threat of monetary sanctions. The agreement: 

1 .) establishes an independent monitor to test performance of the relay center 
operators; 

2.) imposes monetary sanctions by way of liquidated damages of up to $ 25,000 
per month, or up to $300,000 over the next year if MCI fails to meet monthly 
performance standards; and 

3.) reduces the length of MCI's current contract to provide relay services so it 
will end by spring, 1999. 

This agreement will ensure that the quality of relay service in Massachusetts is lestored. 

Protecting Fair Housing Ri ghts Of Individuals With Disabilities 

The Project continues to safeguard the right of individuals with disabilities to live in 
the communities of their choice. Examples of that advocacy during the past ye< r 
include: 

The Disability Rights Project of the Division was contacted by attorneys for a 
nursing home (Pelham House) in Newton which was encountering neighborhood 
opposition to its renewal of a special permit. The facility claimed that the city';; 
unwillingness to renew the permit was violative of the residents' fair housing rights, 
while the city questioned whether the facility had been operating properly. Project staff 
did a presentation on the Fair Housing Act and Title II of the ADA to Newton's Land 
Use Committee. A three-part working group, composed of representatives of the city. 



11 



the neighbors and the Project was established. After a very long evening of 
discussions/negotiations between the groups, people reached an agreement which would 
provide Pelham House with the special permit it needed to continue ftmctioning, and 
establish safeguards and a process for redressing ftiture concerns of the neighbors. The 
Land Use Committee (which had previously voted unanimously to reject the special 
permit application) and the Board of Alderman approved the settlement package and 
granted the special permit. 

The Project obtained a settlement in a fair housing dispute in Lawrence. It grew out 
of Lawrence's refusal to remove a piece of property from its demolitioh list, despite 
there being a developer willing and able to develop the building into a residence for 
individuals with mental disabilities. The Project explained the fair housing implications 
of the city's actions and commenced negotiations with the city to resolve the matter. 
According to the terms of the settlement, the City of Lawrence agreed to provide 
$67,000 in community development funds to help the developer purchase an alternative 
property, to be used for a community residence, and a special employment training 
project 

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: 

—On December 16, 1997, Project staff participated in a day-long training program at the 
State House sponsored by the Boston Center for Independent Living entitled "ADA and 
Employment: How to Make it Work in Your Workplace." Staff gave the keynote 
address, "ADA Compliance: Easier Than You Think," and moderated a panel 
discussion, "Our Changing Workforce: Making Your Company Meet the Needs of the 
Future Employees." Panelists included Commissioners from the Massachusetts 
Rehabilitation Commission and the Massachusetts Commission for the Deaf and Hard 
of Healing, and general counsel of the Massachusetts Office on Disability and counsel 
of the Massachusetts Department of Mental Health. 

-Project staff participated as a panelist on the City of Somerville's cable television 
show, "Access In Action." The show, which has as its focus disability issues, featured 
these topics: 

January 28 - Architectural Access Board and physical access; 

February 25 - Transportation issues; 

March 26 - Legal and practical concerns of ensuring effective communication; 

April 29 - Outdoor recreation activities; 



12 



May 27 - Applicability of state and federal disability laws to houses of worship. 

-On Friday, March 6, 1998, the Project Director moderated a plenary session at the 
N.A.A.G. Civil Rights Conference devoted to the history of the disability rights 
movement, discussing why the disability rights movement, one of the newest 
components of the overall civil rights movement, is one of the most vibrant and vital 
segments of the movement. The three panelists, Liz Savage, Assistant to the Assistant 
Attorney General for Civil Rights, Judith Heumann, Assistant Secretary for Special 
Education and Rehabilitative Services, and John Kemp, head of Very Special Ans in 
D.C., through the telling of their own personal involvement with the disability rights 
movement, illustrated the fundamental principles of disability rights - such as 
exclusion, denial and discrimination. Many conference participants described the 
disability panel as being informative and powerful, and one of their favorite part.s of the 
entire conference. 



13 



CIVIL INVESTIGATION DIVISION 

The Civil Investigation Division (CID) 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 
municip al 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 1998, the Division initiated 437 investigations in the following major 
areas: 

PUBLIC PROTECTION BUREAU fPPB) 

Consumer Protection and Antitrust Division 

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, asset search 
firms, immigration services and employment schemes. Areas also included numerous 
issues affecting the elderly and vulnerable populations, such as the unauthorized 
practice of law, mortgage lending, 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. 
Some ^^■ere multi-state and nationwide and included areas such as fraudulent 
sweepstakes promotions and telemarketing scams. Investigators worked closely with 
other state attorneys general's offices, the U.S. Postal Inspection Service, the Federal 
Bureau of Investigation and the Federal Trade Commission. 

Additional areas affected underage consumers including the sales of fake sports 
memorabilia, the sales of cigarettes and the production and sales of false identification 
cards. 



14 



Civil Rights/Liberties Division 

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 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 a\ailable 
evidence. 

Public Charities Division 

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 federal agents, local police departments, district attorneys and neigl boring 
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 Division (RID) 

Investigators continued to work with PPB and RID attorneys to review and 
investigate businesses and organizations that withheld employees contributions ior 
health insurance premiums, but failed to actually purchase the health insurance 
coverage. Other cases investigated included unlawful sales practices also knowTi as 
"churning," the sale of fraudulent or costly life insurance and other policies to the 
elderly. 

Bureau Prosecutor 

Investigators worked with the PPB Prosecutor on numerous cases which resulted in 
indictments and convictions against individuals for violations of the Commonwealth's 
criminal 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 fimdraisers and embezzlement from non-profit 
organizations. 



15 



GOVERNMENT BUREAU 

Environmental Protection Division 

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 
for clean-up of polluted or hazardous waste sites. Investigators also located former 
employees and officers of defunct companies responsible in part for such violations, 
evaluated and analyzed financial documents, and prepared ability to pay analyses. 

Trial D'vision 

The Division played a major role in tort actions filed against the Commonwealth by 
investigating allegations of abuse, mistreatment and deaths of individuals 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. 

CRIMINAL BUREAU 

Safe Neighborhood Initiative (SND 

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. 

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. 

Investigators also participated in the efforts to reform the disability pension system. 

16 



STATISTICS 

The Division opened 437 investigations in Fiscal Year 1998, with 329 
investigations ongoing as of June 30, 1998. Case distribution by division and/or 
bureau is as follows: 


DIVISION/BUREAU 


OPENED 
DURING FY '98 


ONGOING AS 
OF 6/30/98 


; Consumer Protection/ Antitrust 


52 


61 


! Civil Rights 


18 


10 


Public Charities 


4 


6 


Regulated Industries 


2 


5 


PPB/Criminal 


28 


37 


Government 


2 


4 


Environmental Protection 


23 


24 


Trial 


305 


178 


Insurance Fraud 


3 


4 


TOTAL 


437 


329 




17 





Public Document 



No. 18072 



®l]e dontmmt&Jcalili of J3tesjiti|uselts 



REPORT 



OF THE 



ATTORNEY GENERAL 



FOR THE 



Year Ending June 30, 1998 




HON OF THIS Document Approved by Philmore Anderson hi. State Purchasing Agent. 

PRINT-lO/99-7000044 Estimated Cost Per Copy 5.50 

Printed on Recycled Paper 

o 



Commonwealth of Massachusetts 

In accordance with the provisions of Section 1 1 of Chapter 12 of the Massachusetts 
General Laws, I hereby submit the Annual Report for the Office of the Attorney General. This 
Annual Report Covers the period from July 1, 1997 to June 30, 1998. 



Respectfully Submitted 

Scott Harshbarger 
Attorney General 



Fiscal Year 1998 



OFFICE OF THE ATTORNEY GENERAL 

ATTORNEY GENERAL 

SCOTT HARSHBARGER 

FIRST ASSISTANT ATTORNEY GENERAL 

Douglas H. Wilkins 

CHIEF OF STAFF 

William P. Lee 

Asistant Attorneys General : 



Jonathan Abbott 57 
Ann Ackil 
Richard Allen 
Dorothy Anderson 
David Andrews 
Barbara Anthony 
Luz Arevalo 
Frederick Augenstem 
Lori Balboni 
Thomas Bamico 
Jason Barshak 
Christopher Barry-Smith 
Judith Beals 
Thomas Bean 65 
Annette Benedetto 
Matthew Berge 22 
Anne BerHn 27 
Edward BerUn 
John Bigelow 
Crispin Bimbaum 
Edward Bohlen 
Kimberly Bourgeois 16, 76 
John Bowen 
John Bowman 
Kevin Brekka 
Matthew Brock 
George Brooks 6 



I'ouglas Brown 63 
VilUam Brownsberger 62 
Matthew Buehler 32 
Margaret Bulger 
Brian P. Burke 
David Bums 59 
Barrando Butler 26 
Eric Carriker 
fames Caruso, Jr. 
?amela Castrucci 
Eileen Cenci 
i-ael Chester 6 
hhn Christin 
J)hn Ciardi 
Pter Clark 
Jffi-ey Clements 
E ward Colbert 
R:hard Cole 
Jonna Connolly 
Paricia Correa 
Piece Cray 
Joh Crimmins 
Mihael Cullen 54 
Marice Cunningham 
Wi iam Daggett 
Mioael Dash 66 
Parela Dashiell 20 



Leslie Davies 
Gerald D'Avolio 13 
Ed DeAngelo 
George Dean 
Linda DelCastilho 
Stephen Dick 
Michael Dingle 
Elizabeth DiTomassi 
William Duensing 
Henry Eaton 
Deborah Ecker 
David Edmonds 1 3 
Stanley Eichner 
P. Henry Ellis 
Barbara Fain 
Jennifer Ferreira 
Freda Fishman 
Francis Flaherty, Jr. 56, 15 
Mary Freeley 
Cynthia Gagne 
Rosemary Gale 
Rosalyn Garbose 
Rafael Garcia 34 
Suzanne Click Gilfix 
Gregory Gilman 
Salvatore Giorlandino 
I. Andrew Goldberg 



Richard Gordon 
Thomas Green 67 
Leslie Greer 
Mary Griffin 
John Grossman 
John Grugan 7 
Irene Guild 
Daniel Hammond 
Charles Harak 62 
Nancy Harper 
Sarah Hartry 
Katherine Hatch 
Christian Hatfield 2 
LaDonna Hatton 1 8 
Richard Hecht 12 
Michael Hering 
Lee Hettinger 1 7 
R. Scott Hill-Whilton 26 
John Hitt 7 

Audrey Huang 
Pamela Hunt 
Marsha Hunter 
Carol lancu 
Marcia Jackson 
Patrick Johnston 
Diane Juliar 
Michelle Kaczynski 
Judy Zeprun Kalman 
Susan Kang 74 
Glenn Kaplan 
Marcy Kaplan 30, 72 
Jamie Katz 
Sean Kealy 
Stephanie Kelly 53 
Carolyn Keshian 
Rosa Kim 
Mark Kmetz 2 1 
Michael Kogut 
Pamela Kogut 
Helen Koroniades 3 
SiuTip Lam 14 
Andrew Latimer 8 
Karen Laufer 69 
Andrew Lawlor 



Ellyn Lazar 
Angela Lee 
William Lee 
Peter Leight 
Martin Levin 
Susanne Levsen 
Leonard Lopes 19 
Kara Lucciola 
Glenn MacKinlay 
Anita Maietta 
M. Toni Maloney 25 
Julie Marcus 24 
David Marks 
Josefina Martinez 58 
Laura Maslow-Armand 
Gregory Massing 
William Matlack 
William McAvoy 
Thomas McCormick 
Karen McGuire 
Kristin Mcintosh 75 
Frances Mclntyre 
Beth McLaughlin 
William Meade 
Marianne Meacham 
Elizabeth Medvedow 
Joyce Meiklejohn 57 
Pamela Meister 
Ramon Melendez 
Howard Meshnick 
Nicholas Messuri 
James Milkey 
Daniel Mitchell 
Margaret Monsell 23 
Helen Moreschi 61 
T. Gregory Motta 29 
Mark Muldoon 
Mark Mulligan 21 
Linda Murphy 71 
Mary Murphy-Hensley 
Vema Myers 2 
Kevin Nasca 
Cathryn Neaves 
Mytrang Nguyen 6 
Jean O'Brien 



Michelle O'Brien 
Thomas O'Brien 
Erin Olson 
Donna Palermino 
Kathryn Palmer 
William Pardee 
Margaret Parks 
Lori Parris 33 
Stephen Patemiti 54 
Anthony Penski 
Rebeca Perez 5 
Judith Phillips 
Mary Phillips 
Barbara Piselli 
William Porter 
Anne Powers 
Frank Pozniak 57 
Patricia Preziosa 64 
Candies Pruitt 
Christopher Quaye 1 
Robert Quinan 

ilizabeth Reinhardt 
Juliana Rice 1 1 
Shelley Richmond 
Robert Ritchie 13 
Benjamin Robbins 70 
}3everly Roby 
\nthony Rodriguez 
J oseph Rogers 
I'eirdre Rosenberg 
Suart Rossman 

'< ter Sacks 

. Selena Samm 73 

:r lest Sarason, Jr. 

'a jqua Scibelli 

•1 lie Scott 

ih aron Scott 

ii ly Sharff 

Icil Sherring 

cbert Sikellis 

; emy Silverfine 
'J lam Simms 35 

inny Sinkel 9 

)aime Smith 52 

oretta Smith 51 



Mark Smith 
Johanna Sons 
Leo Sorokin 50 
Amy Spector 
Richard Spicer 
Susan Spurlock 
Carol Starkey 
Kenneth Steinfield 31 
James Stetson 
Deborah Steenland 
Mark Sutliff 
James Sweeney 
Diane Szafarowicz 
Pamela Talbot 
Rosemary Tarantino 
Neil Tassel 
Shelly Taylor 55 
Jane Tewksbury 60 
Steven Thomas 
Bruce Trager 
Thomas Ulfelder 
Margaret Van Deusen 
Brett Vottero 68 
Gina Walcott 
Lucy Wall 
George Weber 
Mark Weber 77 
Peter Wechsler 4 
Joseph Whalen, III 
James Whitcomb 
Douglas Wilkins 
H. Gregory Williams 
Odette Williamson 1 
Jane Willoughby 
Howard Wise 
John Woodruff 
Chi Chi Wu 
Charles Wyzanski 33 
Judith Yogman 
Karla Zarbo 28 
Catherine Ziehl 
Michael ZuUas 



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



William Berman 




Timothy McDonough 


David Breen 






Philip McGovem 


Heidi Handlei 






Vanessa Sanchez-Gasparro 


Joshua Krell 






Marie St. Fleur 


APPOINTMENT DATE 


TERMINATION DATE 


1. 


07/07/97 


50. 


07/10/97 


2. 


07/14/97 


51. 


07/18/97 


3. 


07/28/97 


52. 


07/23/97 


4. 


08/25/97 


53. 


08/14/97 


5. 


08/27/97 


54. 


08/15/97 


6. 


09/02/97 


55. 


08/29/97 


7. 


09/08/97 


56. 


09/02/97 


8. 


09/15/97 


57. 


09/05/97 


9. 


09/18/97 


58. 


09/20/97 


10. 


09/23/97 


59. 


09/30/97 


11. 


09/25/97 


60. 


11/14/97 


12. 


09/29/97 


61. 


11/30/97 


13. 


10/27/97 


62. 


01/16/98 


14. 


11/03/97 


63. 


01/19/98 


15. 


11/10/97 


64. 


01/23/98 


16. 


11/12/97 


65. 


02/03/98 


17. 


11/16/97 


66. 


03/03/98 


18. 


11/17/97 


67. 


03/05/98 


19. 


1 1/24/97 


68. 


03/09/98 


20. 


12/01/97 


69. 


03/12/98 


21. 


12/08/97 


70. 


03/13/98 


22. 


12/29/97 


71. 


03/16/98 


23. 


01/07/98 


72. 


04/03/98 


24. 


01/12/98 


73. 


04/06/98 


25. 


01/27/98 


74. 


05/18/98 


26. 


02/09/98 


75. 


06/13/98 


27. 


02/23/98 


76. 


06/21/98 


28. 


02/25/98 


77. 


06/30/98 


29. 


03/02/98 






30. 


03/09/98 






31. 


03/18/98 






32. 


03/30/98 






33. 


05/04/98 






34. 


06/01/98 






35. 


06/08/98 







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BUSINESS AND LABOR PROTECTION BUREAU 

Fiscal Year 1998 celebrated the third anniversary of the Business and Labor Protection 
Bureau since its creation in April, 1995. The Bureau consists of the Unemployment Fraud 
Division (formerly known as the Division of Employment and Training), the Fair Labor & 
Business Practices Division, the Insurance Fraud Division and the Medicaid Fraud Control Unit. 
The benefits of combining these four divisions as part of a separate, yet coordinated. Bureau 
continued to grow as an expanding synergy developed between the divisions. 

Sharing common goals of eliminating fraudulent activit'ei in the marketplace and 
establishing a level playing field in the economic sector for hurt esses and individuals alike 
resulted in better efficiency and productivity by each division. By tapping into the legal and 
investigative resources available fi-om all of its divisions, each c'" which are experienced in the 
areas of fi-aud prosecution, the Bureau was able to maximize i s overall impact and effectiveness 
in combating the "fraud tax" which unfairly increases the cos's and expenses of honest 
businesses, insurance policy holders and taxpayers in Massac *-! setts. 

The Bureau maintains its own in-house educational ?r'' training programs to supplement 
office wide efforts with sessions and materials specifically j e ;ed to the types of cases assigned 
to its four divisions. Included among the educational progr i s presented by the Bureau were 
grand jury practice, appellate procedures, evidence, discoveq motion practice, investigative 
techniques, and trial preparation and skills. A Deputy Burei» Chief and a Chief Prosecutor assist 
the Bureau Chief in adopting and implementing consistent h g '1 policies and procedures 
throughout the Bureau. 

In Fiscal Year 1998, the number of inter-divisional i.ii estigations and prosecutions once 
again increased substantially, highlighted, among many oth;/, by cases such as New England 
Job Center (unemployment tax and workers compensation premium fi"aud); Amaral Excavating 
(prevailing wage and workers compensation premium fraud) Se; ;\ er Construction Company 
(prevailing wage, unemployment tax and workers compen^i ion premium fi-aud); L&D Trucking 
(prevailing wage, unemployment tax and workers comper s don pi^mium fi-aud); Leone's on the 
Waterfi-ont (nonpayment of wages and unemployment tax f lud); ( . °. McDonough Construction 
(nonpayment of wages and workers compensation premii n fi-aud); E li's Glass and Mirror 
(nonpayment of wages, unemployment tax and workers cj ipensati r premium fraud); and 
M.E.C./Paul Masachi (prevailing wage, overtime and wr r' ;rs compensation premium fraud) 
featured in the following pages. 

The Bureau maintains its primary offices at 20) ' ortland Strec I, Boston and 165 Liberty 
Street, Springfield. 



UNEMPLOYMENT FRAUD DIVISION 

The Unemployment Fraud Division ("UFD") is comprised of eleven staff members: a 
division chief, managing attorney, four assistant attorneys general, two investigators, an office 
manager, an administrative assistant and an intern. Pursuant to its authority under Massachusetts 
General Laws Chapter 151 A, Section 42 A, the UFD enforces the provisions of the Massachusetts 
Employment Security Law. Actions involving employer tax fraud and larceny of unemployment 
benefits are prosecuted in the Commonwealth's District and Superior Courts. 

The UFD receives its referrals primarily from the Division of Employment and Training 
("DET"). Quarterly meetings are held between the management staff at the DET and the UFD. 
Strong interagency communication between the DET and the UFD is a key ingredient to our 
success. 

The UFD also generates its own independent actions. Through cross references from 
other divisions in the Business and Labor Protection Bureau, the UFD 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 UFD's investigation and successfiil prosecution of egregious violators. In 
particular, our focus this year on our collaboration with other federal and state agencies has made 
a significant impact on the illegal activities of temporary employment agencies in Massachusetts. 

During Fiscal Year 1998, members of the UFD addressed 316 cases in District Courts 
throughout the Commonwealth. The UFD recovered $1 ,878,454.40 in restitution owed to the 
Commonwealth. This number reflects a continuing, significant increase from the amounts of 
restitution recovered in Fiscal Year 1995 ($863,023.71), Fiscal Year 1996 ($954,842.06), and 
Fiscal Year 1997 ($1,517,019.30). The steady increase in the amount of restitution returned to 
the Commonwealth's Unemployment Trust Fund correlates with the increased amount of 
resources the UFD has allocated to the monitoring of cases on probation. 

HIGHLIGHTED EFFORTS 

& 

SIGNIFICANT ACTIVITIES 

EMPLOYMENT SECURITY FRAUD 

• Commonwealth v. Richard Purtell (Essex Superior Court) - Richard Purtell, 47, of 

Pelham, N.H., and his temporary employment agency. New England Job Center, 
were each indicted by an Essex County Grand Jury on 6 counts of insurance 
fraud, 18 counts of unemployment fraud, and 2 counts of larceny. The charges 
stem from an extensive investigation led by the UFD in cooperation WITH 
SEVERAL federal and state agencies. The investigation uncovered over one 



11 



million dollars in alleged unemployment and insurance fraud. Purtell and his 
company are alleged to have engaged in a pattern of deception spanning four 
years in which Purtell classified his temporary workers as independent contractors 
in order to avoid paying unemployment taxes. In addition, Purtell allegedly 
submitted false payroll information to New England Job Center's workers' 
compensation insurers in order to avoid paying required insurance premiums. 

Commonwealth v. Vicente Roman (Fitchburg District Court) - After a bench 
trial in the Fitchburg District Court, Vicente Roman of Leomiaster was found 
guilty of fraudulently collecting $3,884 in unemployment benefits while he was 
working at Paragon Plastics in Leominster in 1989. The defendant was sentenced 
to 2 years probation with an order to pay ftill restitution to the Commonwealth. 

Commonwealth v. Troy Hughey (Springfield District Court) - Troy Hughey of 
Springfield, was found guilty on 33 counts of unemployment benefit fraud and 
sentenced to one year in the House of Correction, suspended for 5 years, and an 
order to pay full restitution to the Commonwealth in the sum of $5,869. 

Commonwealth v. Barbara Brox (Salem District Court) - Barbara Brox pled 
guilty, in Salem District Court, to 13 counts of unemployment fraud in violation 
of G.L. c. 151 A, §47. Brox wrongfully was collecting unemployment benefits 
from October of 1995 through March of 1996. The case was continued without a 
finding for 30 days upon payment by Brox of fiill restitution to the 
Commonwealth in the amount of $6,83 1 . 

Christine Dalton v. DET (Massachusetts Appeals Court) - This case was briefed 
and argued before the Appeals Court on behalf of the DET and currently is 
pending a decision. The issue presented is whether the DET correctly determined 
that a claimant was not entitled to extended benefits because she missed the 1 5 
week filing deadline by a substantial margin. 

Commonwealth v. David Kusek (Boston Municipal Court) - David Kusek 

of Ware pled guilty to failure to pay unemployment contributions. He was 
sentenced to 5 years probation and ordered to pay the Commonwealth full 
restitution in the amount of $15,000. 

Commonwealth v. Kevin James (Boston Municipal Court) - Kevin James 

of Boston was found guilty on 33 counts of unemployment benefit fraud and 
sentenced to 90 days in the House of Correction with 4 years probation and an 
order to pay the Commonwealth full restitution in the sum of $2,965. 

Commonwealth v. George T. Ladd (Boston Municipal Court) - George T. 
Ladd of Great Barrington admitted to sufficient facts on three felony counts for 
the failure to provide true and accurate employment records and the failure to pay 
unemployment contributions to the Commonwealth. 



12 



The investigation conducted by the UFD and the DET revealed that Ladd, 
President and Treasurer of Nucom, Inc., laid off several employees, directed them 
to collect unemployment benefits, later rehired each employee and then paid them 
under the table wages that subsidized the unemployment benefits they were 
receiving. In addition, Ladd filed false reports to the DET resulting in the 
assessment of lower unemployment contributions. 

The case was continued without a finding for one year with an order to pay fiill 
restitution to the Commonwealth in the sum of $4,074.81. 

TEMPORARY EMPLOYMENT AGENCY TASK FORCE 

Members from the Unemployment Fraud Division organized and chaired meetings with 
representatives from local, state and federal law enforcement agencies, as well as other divisions 
within the OAG, to discuss the regulation, investigation, and prosecution of temporary 
employment agencies engaged in illegal activities. 

DEFAULT SWEEP 

With the assistance of the State Police Unit attached to the Office of the Attorney 
General, ten defendants on default with active felony charges were targeted for arrest. The UFD 
secured the presence of three of the targeted defendants before the Court. 

• Commonwealth v. Sean Maloney. Shamrock Landscape Services. Inc. . Boston 
Municipal Court - Sean Maloney of North Weymouth was arrested at his work 
site by the State Police as part of a default warrant sweep and brought to the 
Boston Municipal Court. After the bail argument, the Court ordered cash bail at 
$2,500 surety and $250 cash. Maloney paid the bail. Subsequently, the Court 
scheduled a hearing on revocation of the extant order continuing the case without 
a finding. 

• Commonwealth v. Elaine Lawrence a/k/a Gwendolyn Cromwell . 

Boston Municipal Court - After a jury trial in the Boston Municipal Court, Elaine 
Lawrence a/k/a Gwendolyn Cromwell of Dorchester was found guilty of failure to 
pay unemployment contributions. Lawrence was sentenced to serve 60 days in 
jail, suspended for 3 years, and ordered to pay the Commonwealth ftill restitution 
in the amount of $28,500. 

• Commonwealth v. Leopold L.K. Sorger a/k/a Women's Medical Arts. Inc .. 
Boston Municipal Court - Dr. Leopold L.K. Sorger failed to pay employer taxes 
for seven non-consecutive quarters from January 1993 through June 1995. On 
December 1, 1997, Dr. Sorger appeared in the Boston Municipal Court to remove 
a default warrant that was outstanding since April 9, 1 996. Dr. Sorger flew to 
Boston from St. Thomas, in the Virgin Islands, after receiving an arrest notice 
from the Attorney General's Office. 



13 



On February 6, 1 998, Dr. Sorger admitted to sufficient facts and the Court 
continued the matter without a finding for 6 years with the payment of full 
restitution to the Commonwealth in the amount of $29,572.18. 

PRISONER CROSSMATCH INITIATIVE 

The UFD initiated a successful interagency effort by facilitating the creation of a 
computer crossmatch program between the DET and the Department of Corrections which 
ensures that prisoners in state prison facilities do not fi-audulently collect uneftiployment benefits 
while incarcerated. Since the inception of the crossmatch program in October, 1997, over 17 
present or former prisoners have been caught committing this scheme and prosecuted. 

• Commonwealth v. Moses Pedro (Bristol Superior Court) - 

Moses Pedro, a resident of South Dartmouth and an inmate at the Southeast 
Correctional Center in Bridgewater, pled guilty to 8 counts of imemployment 
fraud. 

With the assistance of several family members, Pedro fraudulently collected 
$1,517 while he was incarcerated. Specifically, Pedro arranged to have family 
members submit fraudulent documents to DET and sign his name to 
unemployment benefit checks from January 22, 1997 through the week ending 
March 8, 1997, while he was serving a sentence at the Southeast Correctional 
Center. 

The Court sentenced Pedro to 6 months in the House of Correction, from and after 
the sentence he is currently serving. 30 days to be served, with the balance 
suspended for five months and ordered that he make payment of full restitution to 
the Commonwealth. 

• Commonwealth v. John T. Cappellucci. Jr. (Middlesex Superior Court) - John T. 
Cappellucci Jr., a resident of Watertown, pled guilty in Middlesex Superior Court 
to 7 counts of unemployment fraud. 

Cappellucci submitted false paperwork to the DET in order to collect 
unemployment insurance benefits totaling $1,810.00 while he was incarcerated in 
MCI Concord. In addition, after he was released he went back to the DET 
seeking benefits for other weeks during which he had been incarcerated. 

The Court placed Cappellucci on probation for three years, required him to pay 
restitution to the Commonwealth and ordered him to perform five hours of 
community service per week for the first year of his probation. 

• Commonwealth v. Edgar Alvarez (Suffolk Superior Court) - 



14 



Edgar Alvarez of East Boston, pled guilty in Suffolk Superior Court to 1 5 counts 
of unemployment fraud. 

Alvarez applied for unemployment insurance benefits two days before he was sent 
to jail on another matter. Then, with the assistance of his brother and sister, he 
continued to submit fraudulent documents to the DET. This arrangement 
permitted him to collect imemployment benefits totaling $2,925 from the week 
ending November 30, 1996 through the week ending February 22, 1997, during 
which time he was incarcerated in the Middlesex County House of Correction and 
the Longwood Treatment Centei The Court placed Alvarez on probation for 
three years and ordered him to pay full restitution to the Commonwealth. 

Commonwealth v. Kenneth Merrill (Haverhill District Court) and 
Commonwealth v. Carol J. Briggs (Haverhill District Court) - Kermeth Merrill, a 
former inmate, pled guilty to seven counts of unemployment fraud. He was 
sentenced to one year probation and ordered to pay full restitution of $929 to the 
Commonwealth jointly and severally with his co-defendant, Carol J. Briggs, who 
had assisted him in submitting fraudulent documents to the DET which allowed 
Merrill to collect unemployment benefits while he was incarcerated. 

Commonwealth v. Robert A. Devaney (New Bedford District Court) - Robert A. 
Devaney, a former inmate at the Bristol County House of Correction, pled guilty 
to 4 counts of unemployment fraud. 

Devaney fraudulently collected imemployment benefit checks totaling $2,104 
from December 2, 1995 through the week ending January 20, 1996, while he was 
serving a sentence at the Bristol County House of Correction. 

The Court sentenced Devaney to 2 Vi years in the House of Correction, suspended 
for 3 years, with an order that he make payment of full restitution to the 
Commonwealth plus a fine of $2,500 and a surfine of $725. 



15 



DIVISION STATISTICAL SUMMARY 



MONIES COLLECTED 




Fiscal Year 1998: 




July, 1997 


$ 97,904.32 


August 


61,434.78 


September 


142,625.20 


October 


111,715.74 


November 


370,651.37 


December 


71,498.64 


January, 1998 


73,285.31 


February 


377,990.60 


March 


142.151.69 


April 


91,077.83 


May 


243,245.20 


June, 1998 


94.873.90 


Total 


$1,878,454.58 


Total as of July 31, 


1998: $2,067,220.50 



16 



CASES PENDING AS OF JUNE 30. 1998 

Criminal Employee Claims 360 

Criminal Employer 435 

Other* ^7 

Total Pending Cases 852 

CASES ON DEFAULT AS OF JUNE 30. 1998 

Criminal Employees Claims 162 
Criminal Employer 130 

Total Defaults 292 



CASES CLOSED AND RETURNED TO PET 

Criminal Employee Claims 64 

Criminal Employer 67 

Other* 10 

Totals 142 



COMPLAINTS ISSUED 

Criminal Employee Claims 18 (182 counts) 

Criminal Employer 24 (183 counts) 

Other* il ( 33 counts) 

Totals 53 (398 counts) 



INDICTMENTS RETURNED 

Total 47 (108 counts) 



*Includes employer tax and/or employee fraudulent claims cases independently 
developed and/or specially referred. 



17 



FAIR LABOR & BUSINESS PRACTICES DIVISION 



The Fair Labor and Business Practices Division ("FLBP") is comprised of the Division 
Chief, Managing Attorney, Western Massachusetts Deputy Managing Attorney, nine additional 
assistant attorneys general, twenty-four inspectors, two financial investigators, seven 
Hotline/Intake staff, two paralegals, an Outreach Coordinator and five support personnel. FLBP 
staffs full-time offices in Boston and Springfield as well as satellite offices in Fall River, 
Worcester and Pittsfield. > 

FLBP is responsible for enforcing the Massachusetts wage and hour laws, including the 
prevailing wage, minimum wage, overtime and nonpayment laws as well as the child labor and 
workplace safety laws. In addition to investigating and prosecuting offenders for these 
violations, FLBP investigates and prosecutes offenders for workers" compensation and 
unemployment ft-aud violations. FLBP also staffs a Bid Protest Unit that arbitrates public 
construction bid disputes through office hearings. 

FLBP investigated 4,990 complaints during the fiscal year. Prosecutions and debarments 
increased significantly over last year's efforts. The majority of cases that were not prosecuted 
were resolved successfully with full resthution paid to the complainants. A total of $2,191,471 
in owed wages was collected for employees as a direct result of FLBP's efforts. 



HIGHLIGHTED EFFORTS 

& 
SIGNIFICANT ACTIVITIES 



Staffing 

Many positive staffing changes occurred this year. A Deputy Managing Attorney for 
Western Massachusetts was appointed and assigned to the Springfield FLBP Office on a full- 
time basis. Three additional assistant attorneys general were hired for the Boston Office. Six 
new inspectors with investigative and criminal justice experience also were hired. The Attorney 
General created an Outreach Coordinator position to focus on enhancing FLBP's interaction with 
the public. The Coordinator acts as a liaison between the Office of the Attorney General and the 
community, encouraging an ongoing dialogue between FLBP, employers and employees about 
their rights and responsibilities as well as about the Office's enforcement efforts. 

Deployment of Personnel 

Beginning in the Spring of 1998, FLBP's Inspectional and Legal Staffs have been 



18 



assigned to specific geographical areas determined by court jurisdictions. The Inspectors will be 
working proactively in their districts at least one day a week. This will allow the respective 
courts and the surrounding communities to become familiar with the FLBP staff who serve their 
districts as well as allow FLBP to create a better public awareness of the work it does, the 
assistance it can offer, and the laws it enforces. 

Expanded Prosecutions 

FLBP staff also investigate and prosecute other potential employment related offenses 
such as workers' compensation and unemployment fraud violations. Often times employers who 
do not pay their employees also fail to contribute to the Unemployment Compensation Trust 
Fund and fail to provide workers compensation. Such potential violations are checked in every 
FLBP investigation and, to the extent instances of these types of fraud are discovered, they are 
included in any prosections FLBP subsequently pursues. 

Central Artery/Tunnel Enforcement Team 

FLBP created a Central Artery /Tunnel ("CA/T") Enforcement Team to specifically focus 
on monitoring wage compliance at the country's largest public construction project. The team is 
responsible for investigating and prosecuting violations of the wage and hour laws, primarily 
those involving failure to pay the prevailing wage, as well as other criminal offenses. The team 
also works with the Massachusetts Highway Department in their education and enforcement 
efforts. Members of the team, directed by the Division Chief, include two assistant attorneys 
general, four inspectors and one paralegal. 

In May 1998, as a direct result of the team's efforts, a Suffolk County Grand Jury 
returned ninety indictments charging the following trucking companies working at the CA/T 
with 243 violations of employment related laws: 

A.C. Equipment Company. Inc./Angelo Ciardiello - A.C. Equipment Company, 
Inc. of Wakefield, and its president, Angelo F. Ciardiello, were each indicted for 
failure to pay the prevailing wage and failure to pay overtime to four employees, 
two counts of failure to submit payroll records and two counts of failure to keep 
true and accurate records. Ciardiello was also charged with four counts of failure 
to pay unemployment contributions. 

• E. Almeida and Son/Edlin Almeida, Jr. - Edlin Almeida, Jr., owner of E. Almeida 

and Son of Rehoboth, was convicted of failure to pay the prevailing wage rate (4 
counts), failure to file certified payroll records, failure to file true and accurate 
certified payroll records and failure to keep true and accurate records in 
connection with trucking services on the Central Artery Project. He was placed 
on probation, debarred for six months and ordered to pay $20,919 restitution to 
his employees. 



19 



Amaral Excavating. Inc ./Daniel Amaral - Amaral Excavating, Inc. of Somerville 
and its president, Daniel P. Amaral, each were indicted for failure to pay the 
prevailing wage rate and failure to pay overtime to seven employees, one count of 
failure to keep true and accurate records and one count of failure to provide 
workers compensation. Amaral was additionally charged with failure to register 
with the Department of Employment and Training. 

Ralph Caruso, Jr. - Ralph Caruso, Jr. of Lynnfield, was indicted for failure to pay 
the prevailing wage rate to two employees and failure to keep 'true and accurate 
records. 

Commonwealth Trucking. Inc./Matthew Connolly - Commonwealth Trucking, 
Inc. of Quincy and its president, Matthew Connolly, each were indicted on failure 
to pay the prevailing wage rate to two employees, one count of failure to submit 
records, two counts of failure to keep true and accurate records and one count of 
failure to pay wages in a timely manner. 

E-Z-Doze-It Excavating. Inc./Harold J. McGinn - E-Z-Doze-It Excavating, Inc. of 
Wellfleet and its president, Harold J. McGinn, each were indicted for failure to 
pay the prevailing wage rate, failure to pay overtime and failure to pay wages in a 
timely manner to four employees, one count of failure to submit records and one 
count of failure to keep records. 

R.W. James Heavy Equipment/Robert W. James - Robert W. James, owner of 
R. W. James Heavy Equipment of Salem, was indicted for failure to pay the 
prevailing wage rate and failure to pay overtime to seven employees, two counts 
of failure to submit records, one count of failure to keep true and accurate records 
and one count of failure to provide workers compensation coverage. 

L & D Trucking/Lvnden G. Wright and Diane C. Wheatlev - Lynden G. Wright 
and Diane C. Wheatley, owners of L & D Trucking of Bellingham, were indicted 
on failure to pay the prevailing wage rate to four employees, one count of failure 
to submit records, one count of failure to keep true and accurate records, two 
counts of failure to pay wages in a timely manner, three counts of failure to file 
with the Department of Employment and Training and pay contributions, and one 
count of failure to provide workers compensation coverage. 

Molloy Excavating. Inc./Bartholomew Mollow - Bartholomew MoUoy, owner of 
Molloy Excavating of Norwood, was indicted for failure to pay the prevailing 
wage rate, failure to pay overtime and failure to pay wages in a timely manner to 
one employee, one count of failure to submit records and one count of failure to 
provide workers compensation coverage. 

T. P. Morabito Trucking/Thomas P. Morabito. Sr. - Thomas P. Morabito, St., 
owner of T.P. Morabito Trucking of Belmont, was indicted for failure to pay the 



20 



prevailing wage rate, failure to pay overtime and failure to pay wages in a timely 
manner to six employees, two counts of failure to submit records and one count of 
failure to keep true and accurate records. 

• N.S.G. Trucking Limited/Noel J. St. George - Noel J. St. George, owner of N.S.G. 
Trucking, Limited, a Rhode Island company, was indicted for failure to pay the 
prevailing wage rate to four employees, one coimt of failure to keep true and 
accurate records and one count of failure to provide workers compensation 
coverage. 

• O'Donnell Sand and Gravel Co.. Inc./Mary O'Donnell - O'Doimell Sand and 
Gravel Co., Inc. of Kingston, and its president, Mary K. O'Donnell, each were 
indicted for failure to pay the prevailing wage rate to ten employees, failure to pay 
overtime to four employees and three counts of failure to submit records. 

• Buddies. Inc. d/b/a Park Drive Transportation/ Arthur L. Norris - Buddies, Inc. 
d/b/a Park Drive Transportation of Revere and its president, Arthur L. Norris, 
each were indicted for failure to pay the prevailing wage rate to one employee and 
four counts of failure to submit records. 

• Walorz Trucking. Inc./Michael Walorz and James Walorz - Walorz Trucking, Inc. 
of Braintree, its current president, Michael Walorz, and its past president, James 
Walorz, each were indicted for failure to pay the prevailing wage rate to two 
employees and one count of failure to keep true and accurate records. 

During the Fall of 1997, the following four trucking companies entered into settlement 
agreements whereby they paid restitution totaling $1 19,873 to their employees working at the 
CA/T and were debarred for a six month period: 

Amaral Excavating. Inc./Daniel Amaral - Amaral Excavating, Inc., a Somerville- 
based trucking company, and its president, Daniel P. Amaral, agreed to pay 
restitution totaling $69,253 to eight employees. Amaral Excavating and Amaral, 
individually, also agreed to refrain from bidding upon and/or entering into any 
contract, subcontract and/or purchase order for public works construction in 
Massachusetts for a period of six months. 

• Fern Trucking/Joseph Fern - Joseph Fern, owner of Revere-based Fern Trucking, 
agreed to pay restitution in the amount of $19,310 to two employees. Fern also 
agreed to refrain from bidding upon and/or entering into any confract, subcontract 
and/or purchase order for public works construction in Massachusetts for a period 
of six months. 

• Ciampa & Mercurio/Robert Mercurio - Robert Mercurio, co-owner of Ciampa & 
Mercurio Trucking, agreed to pay restitution in the amount of $14,831 to two 
employees. Mercurio also agreed that he and his company would refrain from 



21 



bidding upon and/or entering into any contract, subcontract and/or purchase order 
for public works construction in Massachusetts for a period of six months. 

• Ronzio Trucking/Nicholas Ronzio - Nicholas Ronzio, owner of Ronzio Trucking, 

which is based in Winchester, agreed to pay restitution in the amount of $16,479 
to his employee. Ronzio also agreed to refrain from bidding upon and/or entering 
into any contract, subcontract and/or purchase order for public works construction 
in Massachusetts for a period of six months. 

Prevailing Wage Enforcement Team 

FLBP created a Prevailing Wage Enforcement Team in June of 1998. The team is 
comprised of seven Inspectors whose primary responsibility is the proactive enforcement of the 
Massachusetts prevailing wage law. The Prevailing Wage Enforcement Team investigates 
employee complaints, referrals and anonymous tips received by FLBP. The Prevailing Wage 
Enforcement Team also performs unannounced inspections at numerous public construction 
projects throughout the Commonwealth. During the first month of the Prevailing Wage 
Enforcement Team's efforts, FLBP applied for complaints in four courts, alleging thirty-eight 
violations of the prevailing wage law. 

Workplace Fatality Investigative Team 

FLBP created a Workplace Fatality Investigation Team to develop and establish protocols 
for the investigation and prosecution of workplace fatalities and serious bodily injuries. The 
team also is developing specialized training for emergency response personnel. 

Felix A. Marino Company v. Commonwealth 

The Supreme Judicial Court's decision in the Marino case firmly established the validity 
of the state's prevailing wage law. In a unanimous decision, the Supreme Judicial Court held 
that the Commonwealth's prevailing wage statute, which mentions employees' benefits but does 
not mandate, govern or impact such benefits, is not constitutionally preempted by the Federal 
Employees Retirement Income Securities Act (ERISA). The Court, in acknowledging that there 
are limits to the scope of ERISA, recognized that the prevailing wage law is a wage statute 
concerned with take home pay of employees and is not an employee benefit statute. 

The Court also recognized the deference that must be given to the authority of the 
Department of Labor and Workforce Development to determine what work is subject to the state 
prevailing wage law. The Court fiirther noted that deference also must be given to the 
interpetations of the Attorney General in the exercise of the Office's responsibility to enforce the 
state prevailing wage law. 

Commonwealth v. Thomas Bowley 

Thomas Bowley, the president of Tewksbury Industries, a scrap metal company located 



22 



in Tewksbury, was indicted in January 1997 on two counts of manslaughter. The 
Commonwealth alleges that, despite warnings, Bowley refused to install guards on his machinery 
and did not repair his vehicles. This reckless disregard for the safety of his employees resulted in 
two deaths. In 1994, one victim was killed when his arm became entangled in a guardless metal 
shredding machine. One year later, a second victim was killed when he was run over by a front- 
end loader that had neither working brakes nor a back-up alarm. Bowley's Motion to Dismiss 
the Indictments was denied in April 1998. 

Attorney General v. Vining Disposal Services, Inc. 

FLBP filed a declaratory judgement action seeking a judicial interpretation of the state's 
prevailing wage law to determine whether, and how, it applies to trash hauling contracts between 
private contractors and municipalities. The Attorney General prevailed on cross motions for 
summary judgement and the Court declared that trash hauling contracts with municipalities are 
subject to the prevailing wage law. The defendant appealed and the case was argued before the 
Massachusetts Appeals Court in June, 1998. A decision is pending. 

Perlera et al. v. Vining Disposal Service. Inc. 

The Attorney General, in conjunction with the Department of Labor and Workforce 
Development, filed an amicus brief supporting the plaintiffs' assertion that the state's prevailing 
wage statute applies to drivers and operators of trucks engaged in trash hauling for 
municipalities. 

SIGNIFICANT CASES 



The following list provides an overview of other significant prosecution efforts 
undertaken by FLBP in Fiscal Year 1998: 

• Commonwealth v. Adams Trucking/Elvino Dellaghalfa (Northern Berkshire 
District Court) - Adams Trucking worked on numerous public works construction 
projects in Western Massachusetts. The defendant corporation was convicted of 
(1) failure to pay workers the prevailing wage and (2) failure to file true and 
accurate certified payroll records. The company was debarred from public works 
construction for six months and was ordered to pay restitution totaling $5,718 to 
two employees. The president of the company was placed on pretrial probation 
with the condition that he be debarred from public construction for 6 months. 

• Commonwealth v. Bristol Security Services a/k/a Southern New England 
Security/John Velazquez (New Bedford District Court) - The president of this 
security agency was charged with failure to pay contributions to the Division of 
Employment and Training and failure to provide workers' compensation 
coverage. The case was continued without a finding for 6 months. Velazquez was 
ordered to pay restitution to the Commonwealth in the amount of $1,872 and was 
fined $300. 



23 



Commonwealth v. Heavenly Wings/Salvatore Monteneri (Lowell District Court) - 
The president of this fast food restaurant was charged with failure to pay wages to 
three employees. The case was continued without a finding for one year and the 
president was ordered to pay restitution to his employees totaling $1,267. 

Commonwealth v. Hodges Masonry /Robert' Hodges (Springfield District Court) - 
Hodges Masonry performed carpentry work on a public construction contract in 
Springfield, MA. The owner of the company was convicted of failure to pay the 
prevailing wage and failure to file true and accurate certified payroll records. 
After conviction, he was fined $500 and ordered to pay resfitution to his 
employees totaling $14,136. 

Commonwealth v. Leone's on the Waterfront/Domenic Leone (Fall River District 
Court) - The owner of this restaurant wds charged with failure to pay wages to one 
employee and failure to pay contributiohs to the Department of Employment and 
Training. The cases were continued without a finding for one year and the 
defendant was ordered to pay restitution- to his employees totaling $2,546. 

Commonwealth v. C.P. McDonough Construction/Coleman P. McDonough 
(Wobum District Court) - The president of this construction company was 
convicted of failure to pay wages to four employees and failure to provide 
workers compensation coverage. He v*as sentenced to 60 days in jail, suspended 
for two years, ordered to pay $2,62 1 in restitution to the employees emd assessed a 
$200 fine. 

i 

Commonwealth v. Quality Assurance/Bru'ce Poresky (Springfield District Court) - 
Quality Assurance was the HVAO subcontractor on a public works construction 
project in Springfield, MA. The president of the company was convicted of 
failure to pay his workers the prevailing wage and failure to file true and accurate 
certified payroll records. He was fined $5,500 and debarred for six months. 

Commonwealth v. Quality Meehanical Air a/k/a William's Quality Air/Lynn 
Covington (Springfield Distri($t Court) - Quality Mechanical Air performed sheet 
metal work on a public workS' construction project in Springfield, MA. 
Covington, the president of the company, was charged with failure to pay the 
prevailing wage at the project and failure to file true and accurate payroll records. 
The case was continued without a finding for 6 months. Covington was ordered 
to pay $1,330 in restitution to one employee and was debarred fi-om performing 
sheet metal work on public works construction projects for a period of six months. 

Commonwealth Remedial Systems/Paul Guerra (Wrentham District Court) - The 
president of this defimct high tech company was charged with failure to pay 
wages to seven employees* He "was placed on pretrial probation and ordered to 
pay restitution in the amount of $7,518 to the employees. An agent of the 
company contributed an additional $12,000 towards the money owed to the 



24 



employees. 

Commonwealth v. Scarpaci Construction/Guy Scarpaci (Quincy District Court) - 
The owner of this construction company was charged with failure to pay wages to 
two employees. The case was continued without a finding for one year and 
Scarpaci was ordered tc pay restitution to his employees totaling $3,71 1. 

Commonwealth v. Phoenix Contractors/Mark Wilton/Joseph McKeon (Orleans 
District Court) - Wilton, president of Phoenix Contracting, Inc., and McKeown, 
its operations manager, were convicted of failure to keep true and accurate payroll 
records while engaged in public works. All were debarred from public works 
construction for one year, ordered to pay $10,000 in restitution to the company's 
employees and assessed a $500 fine. Wilton also admitted to sufficient facts to 
find him guilty of failure to pay the prevailing wage and the charge was continued 
without a finding for one yeir. 

Commonwealth v. William C. Bums (Haverhill District Court) - Bums was 
convicted of failure to provicfe workers' compensation coverage and uttering a 
false workers' compensatior. certificate. He also admitted to sufficient facts to find 
him guilty of failure to pay tie prevailing wage and failure to keep tme and 
accurate payroll records. Buns was sentenced to one year in prison, suspended for 
one year; debarred from public works for three years; and ordered to pay $7,826 
in restitution to his employees 

Commonwealth v. Costa Brothtrs Masonry. Inc. (New Bedford District Court) - 
Costa Brothers Masonry was charged with failure to pay the prevailing wage rate 
to its employees. The case was c«ntinued without a finding for six months and 
the company was ordered to pay 14,500 in restitution to five employees and a 
$3,000 fine. 

Commonwealth v. New England Im^ntory /Thomas Marshall (New Bedford 
District Court) - New England Inven:)ry's president, Marshall, was charged with 
failure to pay wages. The case was ceitinued without a finding for six months 
and Marshall was ordered to pay $1,4 IS in restitution to his employees and a 
$1,000 fine. 

Commonwealth v. Allen James & Co. (/obum District Court) - Allen James & 
Co. was convicted of failure to file certil-d payroll records and was ordered to 
pay a $500 fine. 

Commonwealth v. Andrew Fillipone (M^den District Court) -Fillipone was 
convicted of failure to pay wages to theeemployees. He was sentenced to two 
months in prison, suspended for six mptls, and ordered to pay $9,700 in 
restitufion to his employees. 



25 



Commonwealth v. Mark Wilton (Dudley District Court) - Wilton, president of 
Phoenix Contractors, Inc., was convicted of one ount of non-payment of wages 
and admitted to sufficient facts on a second coun:. He was placed on probation for 
six months, assessed a $500 fine plus victim wtiess fees and ordered to pay full 
restitution to his employees in the amount of 5i\587. 

Commonwealth v. John Labadini/Johncath C q?oration (Boston Municipal Court) 

- Labadini, former owner of The Charles R :s aurant in Boston, was convicted of 
one count of non-payment of wages. He v^a' assessed a fine of $500 and ordered 
to pay restitution to his employees totaling S !,445. Labadini also admitted to 
sufficient facts on charges of failure to havf vvorkers compensation coverage and 
failure to pay unemployment contributior s Fhe charges were continued without a 
finding and Labadini was assessed a fine c $2,000. 

Commonwealth v. Jody Cabot (Salem 'Jt trict Court) - Cabot, owner of a store in 
Salem, was convicted of failure to pay ii mployment taxes and admitted to 
sufficient facts on charges of larceny a w failure to provide workers' 
compensation coverage. She was senter ed to serve 10 days in jail, suspended for 
one year, perform 20 hours of communny service work and pay $1,000 in fines. 

Commonwealth v. Ubi Rubinov a/k/a Y^ om Rubinov (Brookline District Court) 

- Rubinov, owner of the Jerusalem Cr f , was convicted of failure to pay the 
minimum wage to one of his employ ;<' and failure to provide true and accurate 
payroll records. Rubinov was senten A'l to 1 8 months probation, ordered to pay 
$3,933 in restitution to his employef ^ u assessed a $750 fine. 

Commonwealth v. Karen Gaiewsk .i' b/a Aero Step Studios (New Bedford 
District Court) - Gajewski was fou^: guil y of failure to provide workers' 
compensation coverage, failure t > ' gister with the Department of Employment 
and Training and non-payment < f^- ages to one former employee. She was 
ordered to pay restitution to he> e ployee and fines totaling $1,100. 

Commonwealth v. Kevin Cre< d ./b/a Kevin Creed Paint Company (Plymouth 
District Court) - Creed, the o'vi* i" of a paint company, was charged wath non- 
payment of wages and failur ; t provide workers compensation coverage. The 
case was continued without d» iding for one year and Creed was ordered to pay 
$500 in restitution to one fcrt -t employee and $1,000 in court costs. 

Commonwealth v. Robert Bo ges/Davis International Marble and Granite. Inc. 
(Orange District Court) - H«i l';es was convicted of one count of non-payment of 
wages. He was sentenced \"v ) months in the House of Correction, suspended 
for two months, and was c rl i-i to pay restitution to his employee totaling 
$6,538. 

Commonwealth v. Cher I'd ti /an. d/b/a Flynstones (Dedham District Court) - 



26 



Sullivan, the former proprietor of a pizza shop, was charged with non-payment of 
wages, failure to pay the minimum wage, failure to provide records and failure to 
provide workers compensation coverage. The case was continued without a 
finding for one year and Sullivan was ordered to pay $300 restitution to one 
former employee and $700 in court costs, with an alternative sentence often days 
in the House of Correction. 

Commonwealth v. Felix Pittorino and Pitt Construction Corporation (Concord 
District Court) - Pitt Construction Corporation and Pittorino. its president, were 
charged with failure to pay the prevailing wage rate and failure to provide true and 
accurate records. The cases were continued without a finding for six months and 
the defendants were ordered to pay $2,050 to one former employee and were 
debarred for three months fi"om bidding on public works projects in 
Massachusetts. 

Commonwealth v. David P. Trook and Raymond and Whitcomb Company. Inc.. 
d/b/a Passages Unlimited. Inc. (Boston Municipal Court) - Trook, the president of 
Raymond and Whitcomb Company, Inc., dba Passages Unlimited, Inc., and the 
company were charged with non-payment of wages to one former employee. The 
cases were continued without a finding for one year and Trook was ordered to pay 
$12,000 in restitution to the claimant, with an alternative sentence of 10 days in 
the House of Correction. 

Commonwealth v. Joyce Travers. d/b/a J.T.'s Sub Shop (Brockton District Court) 
- Travers, the former proprietor of J.T.'s Sub Shop, was convicted of 13 counts of 
failure to pay the minimum wage rate and one count of failure to provide workers' 
compensation coverage. Travers was sentenced to six months probation, ordered 
to pay $1,024 in restitution to 13 former employees and assessed a $200 fine. 

y 

Commonwealth v. Eli Azulay and Eli's Glass & Mirror Company (Brighton 
District Court) - Azulay, the president of Eli's Glass & Mirror Company, was 
charged with non-payment of wage^, failure to pay unemployment contributions 
and failure to provide workers' compensation coverage. The case was continued 
without a finding for one year and Azulay was ordered to pay $1,013 in restitution 
to one former employee, $2,640 in restitution to the Commonwealth and $1,000 
in court costs, with an alternative sentence of 30 days in the House of Correction. 
Eli's Glass & Mirror Company was convicted of one count of unemployment 
fi-aud that was placed on file. 

Commonwealth v. Raymond Miazga (Ware District Court) - Miazga was 
sentenced to 80 days in jail for 16 counts of failure to pay overtime to his 
employees and failure to make payments to the Department of Employment and 
Training for unemployment taxes. 

Commonwealth v. William Elander (Worcester District Court) - Elander was 



27 



charged with failure to pay wages to an employee working in his law office. The 
case was continued without a finding and Elander was ordered to pay $2,382 in 
restitution to his employee. 

Commonwealth v. Creative Construction and Vickie Malone- Wright 
(Northampton District Court) - Creative Construction and its president, Vickie 
Malone- Wright, were convicted of failure to pay the prevailing wage rate and 
failure to pay unemployment contributions on an Amherst public construction 
project. The company was ordered to pay restitution to its employees in the 
amount of $28,000 and $19,000 to the Commonwealth. The company was also 
debarred for six months. 

Commonwealth v. Angelo Antinarelli (Lynn District Court) - Antinarelli, owner 
of Mariah Bay Restaurant, was charged with two counts of non-payment of 
wages. The case was continued without a finding for 1 8 months and Antinarelli 
was ordered to pay $1,089 in restitution to his employees. 

Commonwealth v. M.P.E. Equipment Leasing/Michael P. Sheehan (West 
Roxbury District Court) - Sheehan, M.P.E. Equipment's president , was charged 
with seven counts of non-payment of wages. Both the company and Sheehan 
were charged with eight counts of failure to file Department of Employment and 
Training forms and one count of failure to provide workers compensation 
insurance. Sheehan 's charges were continued without a finding for 6 months. 
The company was convicted of all charges and debarred for three years. Both 
defendants were ordered to pay $17,000 in restitution to the company's 
employees. 

Commonwealth v. M.E.C./Paul Masachi (Barnstable Superior Court) - Masachi 
was convicted of failure to provide workers' compensation coverage and failure to 
pay Department of Employment and Training contributions. He was sentenced to 
1 8 months, suspended for two years. In addition, Masachi was ordered to pay 
restitution to his employees in the amount of $20,000. 

Commonwealth v. Hawkins Structural Systems (Lawrence District Court) - 
Hawkins Structural was convicted of failure to pay the prevailing wage rate and 
failure to pay overtime. The company was debarred for six months and ordered to 
pay $15,300 in restitution to its employees. 

Commonwealth v. Globe Drywall and Fatima Senra (New Bedford District Court) 
- Globe Drywall was convicted of failure to provide certified payroll records and 
failure to pay the prevailing wage rate. It was debarred for six months and 
ordered to pay $1,678 in restitution to its employees. Senra's case was placed on 
file. 

Commonwealth v. Roosevelt Building Products (Framingham District Court) - 



28 



Roosevelt Building Products was convicted of failure to pay the prevailing wage 
rate and failure to provide certified payroll records. It was debarred for six 
months. 

Commonwealth v. Mark Hale d/b/a Correct Construction (Plymouth District 
Court) - Hale was charged with non-payment of wages. The case was continued 
without a finding for three months and Hale was ordered to pay $350 in restitution 
to his employees. 

Commonwealth v. Kevin Duffy d/b/a Metro Construction (Maiden District Court) 

- Duffy worked in construction, mainly performing renovations and additions on 
residential homes. He was convicted of four counts of failure to pay wages to his 
employees and ordered to pay them restitution totaling $6,040. 

Commonwealth v. West Floor Covering and Sally West (Plymouth District Court) 

- West Floor Covering was convicted of failure to file certified payroll records, 
debarred for six months and ordered to pay $8,000 in restitution to its employees. 
West, the company's president, was charged with failure to pay the prevailing 
wage rate. Her case was continued without a finding with a three month 
debarment. 

Commonwealth v. Avelino Dos Reis (Dorchester District Court) - Dos Reis, a 
carpentry contractor, was convicted of failure to provide payroll records. He was 
assessed a $750 fine and debarred for six months. 

Commonwealth v. Seaver Construction Company. Inc. and Scott Seaver 
(Middlesex Superior Court) - Seaver Construction Company was convicted of 
failure to provide unemployment insurance and admitted to sufficient facts on 
charges of failure to pay the prevailing wage rate and failure to provide workers' 
compensation coverage. The company was sentenced to six months probation, 
debarred for three months and ordered to pay $75,000 in restitufion to its 
employees. The president of the company, Scott Seaver, was placed on pre-trial 
probation for six months on the same charges, debarred for three months, ordered 
to guarantee payment of the restitution and ordered to submit weekly certified 
payroll records to the OAG. 

Commonwealth v. Spray-On Systems. Inc. d/b/a Construction Coatings (Newton 
District Court) - Spray-On Systems, a fireproofing company, was convicted of 
failure to provide certified payroll records and was debarred for six months. 

Commonwealth v. William Langley (Pittsfield District Court) - Langley was 
charged with failure to pay wages to one employee. The case was continued 
without a finding for 28 months and the defendant was ordered to pay the 
employee $13,919 in restitution. 



29 



DEBARMENTS 

The following twenty-three companies and individuals were debarred during Fiscal Year 1 998 
pursuant to prosecutions or settlement agreements concerning violations of the prevailing wage 
law: 

• Spray On Systems. Inc. d/b/a/ Construction Coatings. Charles Scott, President 
10 Hawthorne Street, Newton, MA 02158 - debarred for a period of 6 months 
beginning April 9, 1997 through October 9, 1997. 

• W.G. Bums & Sons, Inc. and William G. Bums, President , 476 Kenoza Street, 
Haverhill, MA 01 850 - debarred for a period of three years begirming August 26, 
1 997 through August 26, 2000. 

Roosevelt Building Products. Roosevelt Morin. President . P.O. Box 1779, Bristol, 
CT 06010 - debarred for a period of three years beginning September 23, 1997 
through September 22, 2000. 

• New England Landscaping. AKA New England Landscape & Irrigation. Inc. and 
Paul Santucci. President , P.O. Box 533, Palmer, MA 01069 and 10 Washington 
Road, Brimfield, MA 01008 - debarred for a period of four months beginning 
October 8, 1997 through February 8, 1998. 

• Globe Drywall Svstems. Inc.. Fatima Senra, President . 194 McGowan Street, Fall 
River, MA 02720 - debarred for a period of six months beginning October 15, 
1997throughAprill5, 1998. 

• Amaral Excavating. Daniel Amaral. President . 1 7 Hammond Street, Somerville, 
MA 02143 - debarred for a period of six months beginning October 7, 1997 
through April 7, 1998. 

• Ciampa & Mercurio Tmcking. Robert Mercurio. Owner . 238 Proctor Avenue, 
Revere, MA 02151 - debarred for a period of six months beginning October 7, 
1997 through April 7, 1998. 

• Joe Fern Trucking. Joseph Fem, Owner . 58 Englewood Avenue, Chelsea. MA 
02150 - debarred for a period of six months beginning October 7, 1997 through 
April 7, 1998. 

• Ronzio Trucking. Nicholas Ronzio. Owner . 9 Chapin Street, Winchester, MA 
01890 - debarred for a period of six months beginning October 6, 1997 through 
April 6, 1998. 

• Robert Hodges, Owner of Hodges Masonry Contracting , 23 Tully Road, Orange, 



30 



MA 01364 - debarred for a period of six months beginning November 10, 1997 
through May 10, 1998. 

Bruce Poresky. President. Quality Assurance Sheet Metal . 55 John Downey 
Drive, New Britain, CT 0605 1 - debarred for a period of six months beginning 
November 17, 1997 through May 17, 1998. 

William's Quality Air. Inc. . 7 LeBlanc Lane, South Hadley, MA 01075 - debarred 
from performing sheet metal work for a period of six months beginning December 
15, 1997 through June 15, 1998. 

Hawkins Structural Systems. Inc.. Steve Hawkins. President . 1 Master Drive, 
Franklin, MA 02038 - debarred for a period of six months beginning October 9, 
1997 tlirough April 9, 1998. 

M.P.E. Equipment Leasing. Inc. . 1 1 Sunset Road, Braintree, MA 02184 - 
debarred for a period of three years beginning January 20, 1998 through January 
20,2001. 

Mark D. Wilton . 35 Pilgrim Village Road, Taunton, MA 02780 - debarred 
for a period of one year beginning March 27, 1998 through March 27, 
1999. 

Joseph McKeown . 4 Court Street, Suite 106, Taunton, MA 02780 - 
debarred for a period of one year beginning March 27, 1998 through 
March 27, 1999. 

Seaver Construction Co.. Inc. and Scott L. Seaver. President . 99 Garfield 
Avenue, Wobum, MA 01801 - debarred for a period of three months 
beginning May 1, 1998 through July 31, 1998. 

Pitt Construction Corporation and Felix Pittorino. Owner . 8 1 6 Main 
Street, Acton, MA 01720 - debarred for a period of three months 
beginning May 1 1, 1998 through August 1 1, 1998. 

Adams Trucking. Inc.. and Elvino Dellaghelfa. President . 22 Newark Street, 
Adams, MA 01220 - debarred for a period of six months beginning May 1, 1998 
through November 1, 1998. 

Edlin Almeida. Jr.. d/b/a Almeida & Son Trucking. Edlin Almeida. Jr.. 
President . 1 36 Barney Avenue, Rehoboth, MA 02769 - debarred for a 
period of six months beginning May 27, 1998 through November 27, 
1998. 

Avelino Dos Reis. Owner of A.J. Remodeling . 104 Norfolk Street, Dorchester, 



31 



MA 02124 - debarred for a period of six months beginning May 28, 1998 through 
November 27, 1998. 

Creative Construction and Improvements. Inc.. CCl. Inc.. Vicki Malone Wright . 
President, 267 Wilbraham Road, Springfield, MA 1 1 09 - debarred for a period of 
seven years beginning March 25, 1998 through March 24, 2005. 

Caruso & McGovem Construction. Inc.. Gerald J. McGovem. President, and 
Steven J. Caruso. Treasurer . One Industrial Way, Georgetown,^MA 01833 - 
debarred for a period of six months beginning July 17, 1998 through January 17, 
1999. 

SIGNIFICANT SETTLEMENTS 

Griffin Electric. Co. - The company reimbursed over 120 employees a total 
amount of $169,000 that was improperly withheld for a vacation and holiday plan. 
The company also agreed to cease taking tho§e deductions from the employees' 
prevailing wages in the fiiture. 

Labor Ready - This temporary labor agency agreed to reimburse $7,300 to eleven 
Massachusetts employees hired by Browning Ferris Industries, Inc., who had been 
paid less than the prevailing wage rate required in trash collection contracts. 

Kaminski Associates - Surveyors working on a public works project were not paid 
the correct prevailing wage rate. A settlement was reached whereby the company 
paid $36,800 in restitution to thirteen current and former employees and agreed to 
comply with the prevailing wage law. 

Walsh Construction Company - Surveyors working on a public works projects 
were not paid the correct prevailing wage rate. A settlement was reached whereby 
the company agreed to pay $6 1 , 1 72 in restitution to twelve former employees and 
agreed to comply with the prevailing wage law. 

J.J. Industries Inc. - The company failed to pay the correct overtime rate of time 
and one-half for overtime work performed by its employees. The company 
entered into a settlement and agreed to pay $9,343 in restitution for overtime due 
to its employees. 

Todesca Corporation - The general contractor failed to pay the correct prevailing 
wage rate to one employee who worked for the contractor on a public works 
project. The company entered into an agreement to pay $7,593 in full restitution 
to the former employee. ,. 

Bouchard Painting - A settlement was reached whereby the company paid 
$12,000 in restitution to its employees for failure to pay the prevailing wage rate. 



32 



• Lobster & Lobster. Inc. - This defunct Massachusetts company, with an out-of- 
state owner, failed to pay overtime. A settlement was reached whereby the 
company paid $5,912 in restitution to its employees. 

• General Ship - The company went out of business, filed for bankruptcy protection 
and failed to pay wages to twenty-four of its employees. A settlement was 
reached whereby the company paid its employees $26,000 in restitution. 

• Commonwealth v. M.P. Video Holding Co. - A settlement was reached whereby 
the company, which had failed to pay wages to its employees, agreed to pay 
restitution totaling $13,916 to eleven employees. 

OUTREACH EFFORTS 

FLBP Hotline 

The FLBP Intake Unit staffs a Hotline in the Boston Office, providing information in 
response to questions as well as taking complaints ft-om the general public. Hotline personnel 
include three Intake Clerks and a duty officer from the Inspectional Staff. 

The Hotline received over 90,000 telephone calls (an average of 368 per day) during 
Fiscal Year 1 998 and also assisted over 2,000 walk-ins. This daily contact with the public is an 
important aspect of FLBP's educatior and outreach efforts. 

Re gional Offices 

In addition to the Boston Offce, FLBP staffs four satellite offices. The Springfield 
Office operates full-time with four hspectors, an Assistant Attorney General and a secretary. 
Offices in Worcester, Fall River andPittsfield are open one day a week and are staffed by 
experienced Inspectors. These offices allow us to assist workers and employers throughout the 
Commonwealth by providing them with direct local access to our services and resources. 

FLBP also installed a new call forwarding system in each of the part-time offices that 
forwards calls to the Boston Office when the satellite offices are not staffed. This service 
provides callers with immediate assistance and local access at no additional cost. 

Television Shows 

/ 

Attorney General Harshbarger recorded two episodes of "Issues and Answers" that dealt 
with child labor, workplace safety aid workplace violence. The shows aired on 200 cable stations. 

Speaking Eng a gements 

FLBP has been responsive lo many requests for public presentations about the work of the 
Division. During the last year, FLBP staff has addressed a wide range of organizations including: 



\ 

/ 33 



Martha's Vineyard Chamber of Commerce Fall Meeting 

Martha's Vineyard Rotary Club Awards Luncheon 

Massachusetts Safety Council 

Tsongas Center Conference on Child Labor 

Somerville Peer Leadership Program 

Skoler, Abbott and Presser Law Firm Wage and Hour Seminar 

Massachusetts Coalition for Occupational Safety & Healti Conference/Boston & Holyoke 

Retailers Association of Massachusetts 

Bowdoin Street Health Center's Workers' Memorial Da) Commemoration 

Newton Free Library's Legal Seminar Series 

The Labor Guild's Labor Management Conference , 

Kmart Human Resources Managers 

South Shore Human Resource Management Association 

Massachusetts Society of Certified Public Accountan s 

Chinese Progressive Association 

Labor & Employment Law Section of the Massachus 2f s Bar Association 

Public Law Section of the Massachusetts Bar Associ;iti m 

Interstate Labor Standards Association Annual Meeting 

Construction Law Section of the Massachusetts Bar j v}:;ociation 

Construction Law Section of Boston Bar Association 

Northeast Injury Prevention Meeting 

Massachusetts Council for Human Service Providers 

Clinton Manufacturers Trade Show 

Brighton High School Juvenile Rights Advocacy Proj* d 

National Labor Relations Board 

Massachusetts Association of 766 Private Schools 

South Shore TechA^ocational High School 

Worcester-Fitchburg Building and Construction Trades C luncil 

Greater Boston Central Labor Council 

Plumbers and Gasfitters Local #12 Labor Management Cf jperation Trust 

Goddard Medical Center 

Interpay 

North Central Massachusetts Chamber of Commerce 

Central Massachusetts Employers Association 

Massachusetts AFL-CIO Executive Board 

Massachusetts AFL-CIO Gompers, Murray, Meeney Edutstioual Institute 

Carpenters/Worcester 

Carpenters New England Regional Council 

International Brotherhood of Allied Painters and Craftsmeii 



SAFETY ! 

FLBP investigates all fatalities and serious injuries reported tme Office of the Attorney 
General, as well as all public sector safety complaints and referrals 



34 



The following injury investigations were conducted during Fiscal Year 1998: 



Service Industries 


5 


Construction 


14 


Manufacturing 


5 


Public Employees 


3 


Utility Companies 


2 


Child Labor 


5 


Fatalities 


5 



Total Investigations 39 



CHILD LABOR 

FLBP Inspectors conduct worksite inspections to ensure compliance with the Massachusetts 
Child Labor laws. Some targeted activities result from complaints received and follow-up 
investigations. For example, a large proportion of recent child labor violations have occurred in 
manufacturing and retail donut establishments. In June, FLBP conducted a statewide two-day 
sweep of donut shops, identifying almost 500 violations at 128 such establishments. 

WAIVERS 

FLBP is charged with reviewing requests to waive certain requirements of the labor laws 
under warranted circumstances. Some measure of investigation is required before a decision is 
made to grant such a waiver. This year, FLBP conducted a careful review of the process for issuing 
waivers permitting employers to require employees to work seven days a week. Written materials 
were developed and distributed to clarify the application of the statute and the eligibility for 
waivers. FLBP granted the following waivers: 

Type of Waiver Amount Waiver Fees Collected 

7-Day Continuous Operations 
Meal Break Exemptions 
Seasonal Overtime Exemptions 
Theatrical Performances - Minors 
Sheltered Workshops 
3-Hours Daily Minimum Rule 
Special Student Worker License 
TOTALS: 



BID UNIT 

FLBP's Bid Unit provides a fair and accessible forum for the resolution of public 



35 



76 


$7,600 


61 


6,100 


25 


2,500 


20 


2,000 


12 


600 


14 


700 


99 


4.950 


307 


$24,450 



construction bid protests. With the participation and assistance of pubUc contracting authorities, the 
process can quickly and competently determine the merits of a bid protest. During Fiscal Year 
1998, the Attorney General's involvement in the public bidding arena facilitated the efficient 
completion of public construction projects ranging in cost from $18,000 to over $15 million. 

The Bid Unit's main enforcement efforts include: (i) the receipt and resolution of filed bid 
protests; (ii) the receipt of telephone calls (over 3,900 calls this year) from various constituents ( e.g. . 
architects, contractors, municipal counsel) seeking assistance concerning the public bidding laws; 
(iii) the receipt and resolution of appeals from the Commonwealth's contractor prequalification 
process; and (iv) the education of public contract participants with respect to the bidding laws, 
including the compilation and dissemination of bid protest decisions. In an effort to increase 
accessibility to these decisions, the Attorney General's Office is in the process of establishing a 
partnership with the Massachusetts Bar Association in order to place written bid protest decisions 
on the Internet at the Massachusetts Bar Association web site. 

STATISTICAL SUMMARY 



RESTITUTION 

Total Restitution Recovered for Fiscal Year 1998: $2,191,471.00 

Total Restitution Recovered from October 1993 

(when Division was created) to June 30, 1998 $9,816,105.00 

Complaints Received and Investigated in Fiscal Year 1998 

Non-Payment: 4,435 

Prevailing Wage: 430 

Child Labor: 104 

Safety: 21 

Total Complaints Received and Investigated: 4,990 



36 



INSURANCE FRAUD DIVISION 

The Insurance Fraud Division ("IFD") consists of eleven Assistant Attorneys General, one 
Special Assistant Attorney General, a paralegal and two support staff. The IFD includes a District 
Court Unit that focuses on expediting investigations and prosecutions of fraud cases that are 
appropriate for charging in District Court. 

The IFD investigates all types of insurance fraud allegations involving fraud against insurers 
and against public entities, such as the Commonwealth, municipalities and state or federal agencies. 
The IFD also works with other divisions in the Business & Labor Protection Bureau to investigate 
and prosecute insurance fraud that adversely affects businesses or fair competition. The IFD's cases 
can vary widely, and have included multi-million dollar premium fraud cases, major conspiracies by 
medical and legal professionals, conspiracies centered around auto repair businesses, false injury 
claims regarding staged motor vehicle accidents, inflated claims against homeowner's policies and 
false billing for insured services. 

The IFD receives referrals from a number of sources. The largest source of referred cases is 
the Massachusetts Insurance Fraud Bureau. The IFD also has received referrals from the Public 
Employee Retirement Administration Commission, the Governor's Auto Theft Strike Force, the 
Department of Industrial Accidents, the Workers' Compensation Rating and Inspection Bureau, the 
National Insurance Crime Bureau, the Social Security Administration as well as cities and towns, 
private attorneys, clerk-magistrates, judges and concerned citizens throughout the state. The Office 
of the Attorney General also generates cases internally by cross-referencing matters between other 
divisions and bureaus to the IFD. 

HIGHLIGHTED EFFORTS 

& 

SIGNIFICANT ACTIVITIES 

The Insurance Fraud Division obtained charges in 59 new cases in Fiscal Year 1998 and 
closed 53 cases. Cases prosecuted included charges of workers' compensation fraud, motor vehicle 
insurance fraud, premium avoidance, homeowner's 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 1 998 included allegations that defendants obtained in 
excess of $942,982 in fraudulent insurance payments. The 53 cases resolved in Fiscal Year 1998 
resulted in orders requiring restitution payments of $ 357,892.1 1. 

WORKERS' COMPENSATION FRAUD 

Commonwealth v. Sandra Therrien Albert (Worcester Superior Court) - Sandra 
Therrien Albert owned and operated STAT Courier, a delivery service in Fitchburg. 
July 15, 1997, Ms. Albert pled guilty to workers compensation insurance fraud for 



37 



having under reported the amount of her payroll and falsely reporting the number of 
drivers her business employed from 1989 through 1993 in order to avoid paying the 
proper premiums for her policy. Of her acmal $100,000 per year payroll, Ms. Albert 
reported only $35,000 per year. She was sentenced to three years probation, fined 
$4,000 and ordered to perform 300 hours of community service and to pay $17,000 in 
restitution. 

Commonwealth v. Ramon Albino (Leominster District Court) - On July 23, 1990, 
Ramon Albino sustained neck, back and knee injuries while working for Masci 
Construction. On August 1, 1990, Mr. Albino initiated a workers' compensation 
claim alleging temporary total disability. Liberty Mutual Insurance Company paid 
disability benefits to Mr. Albino from July 26, 1990 through June 2, 1992. However, 
on July 8, 1991, an investigator hired by Liberty Mutual observed and video taped 
Mr. Albino moving furniture and clothing. On July 28, 1991, Mr. Albino was 
videotaped playing soccer, during which time he attempted to conceal his identity 
vsith a large, fake beard. 

On September 15, 1997 Mr. Albino pled guilty to one count of larceny over $250 
and one count of workers' compensation fraud in Leominster District Court. The 
Court sentenced Mr. Albino to six months in the House of Correction, suspended for 
three years, and ordered him to pay a fine of $3,000. 

Commonwealth v. Carlos Velazquez (Leominster District Court) - In 1989 Carlos 
Velazquez allegedly was injured at work. He subsequently collected nearly $25,000 in 
workers compensation benefits from CNA Insurance from December, 1989 until January, 
1992. During this period, however, Mr. Velazquez worked several other jobs. On 
October 18, 1991, while working for Pristine Service Corp., he allegedly injured 
himself again. Between October, 1991 and March, 1992, Mr. Velazquez collected 
additional workers compensation benefits from Liberty Mutual Insurance Company 
totaling $1,562. On August 13, 1997, Mr. Velazquez pled guilty to two counts of 
larceny over $250 and two counts of workers' compensation fraud. He received a 2 
years sentence to the House of Correction, suspended for 3 years, and was ordered to 
pay $18,063 restimtion to CNA and Liberty Mumal, a $2,000 fine, and to perform 100 
hours in community service. 

Commonwealth v Angel Rivera (Brockton District Court) - On March 1, 1994, one day 
after learning that his employment was about to be terminated. Angel Rivera allegedly 
suffered injuries caused by an unwitnessed fall from a ladder while working for the 
Holy Trinity Armenian Apostolic Church of Greater Boston. On March 2, 1994, he 
initiated a workers' compensation claim alleging temporary total disability. 
Travelers Insurance Company paid disability benefits of $300/week to Mr. Rivera 
covering the 50- week period from March 1, 1994 through February 16, 1995. Mr. Rivera 
had, in fact, only missed one day of work from another full-time job with Unique Brake 
Supply of Watertown. On November 6, 1997, Mr. Rivera pled guilty to workers' 



38 



compensation fraud and larceny over $250 charges. He was found guilty on all counts, 
received five years probation and was ordered to pay $15,000 in restitution to 
Travelers. 

lOTOR VEHICLE INSURANCE FRAUD 

Commonwealth v Robert Catrone (Boston Municipal Court) - In 1991 Robert Catrone 
filed a personal injury claim in cormection with an auto accident against Traveler's 
Insurance Company. In order to artificially inflate the amount of the insurance 
payments for lost work time, Mr. Catrone falsely reported to Traveler's Insurance 
Company that he earned $1,200 per >veek from his employer, Re-Nu Homes, Inc. of Revere 
[ In support of his claim, Mr. Catrone submitted a Lost Wage Form to verily his weekly 

wage of $1,200 and a tax return for 1990 that listed income received from Re-Nu Homes, 
Inc. of $61,497. Investigation revealed that the tax return was false. Mr. Catrone 
did not report any income to the Department of Revenue from Re-Nu Homes, Inc. for 1990 
and, in fact, his gross income for 1991 from Re-Nu Homes, Inc. was only $16,663. On 
August 5, 1997, Robert Catrone pled guilty to one count of motor vehicle insurance 
fraud and one count of larceny over $250. The Court imposed a finding of guilty on 
both counts and ordered supervised probation for nine months. In addition, Mr. 
Catrone was ordered to pay $8,000 in restitution to Traveler's Insurance Company. 

Commonwealth v. Dana Bomstein d/b/a Stephen's Auto Sales (Lynn District Court) - 
On May 20, 1995, Dana Bomstein reported to the Saugus Police Department that a car 
engine and a 1985 Dodge Caravan had been stolen from his parking lot. On May 21, 1995, 
he submitted an Affidavit of Vehicle Theft to his insurer. Commercial Union. Mr. 
Bomstein subsequently received a $1,600 settlement from Commercial Union. However, 
prior to the reported theft, Mr. Bomstein had sold the Dodge Caravan in 1994 to a 
private person. 

On September 10, 1997, Mr. Bomstein pled guilty in Lynn District Court to one count of 

motor vehicle insurance fraud and one count of filing a false police report. Mr. 

Bomstein also admitted to sufficient facts for a finding of guilty to one count each 

of larceny and concealment of a motor vehicle. The Court sentenced Mr. Bomstein to 

one year of probation and ordered him to pay $1,600 in restitution and a fine of 

$1,250. 

Commonwealth v Alberto Delduca (Leominster District Court) - On September 13, 
1991, Louis Albert Delduca, a.k.a Carlos Umpierez, allegedly sustained a work-related 
lower back injury due to a slip and fall accident while employed at Leakite in 
Leominster. On several occasions, Mr. Delduca reported to the insurer and his doctors 
that he had never had problems with his neck or back before the accident. The 
Department of Industrial Accidents subsequently ordered Kemper Insurance to pay 
benefits. 



39 



On November 8, 1991, Mr. Delduca, using an alias, was operating his motor vehicle when 
he was rear-ended by a driver operating a U-Haul truck. Mr. Delduca filed a Personal 
Injury Protection application on May 4, 1992, and claimed neck and back injuries. 
Again, Mr. Delduca did not reveal any prior injuries to either the insurance company or 
his doctors. Mr. Delduca subsequently received $2,653 in Personal Injury Protection 
medical benefits. Investigation revealed, however, that Mr. Delduca had in fact 
sustained two prior back and neck injuries; first, in an alleged work-related injury 
on February 7, 1990, and then again on July 12, 1990, when he allegedly sustained neck 
injuries in a motor vehicle injury. 

On September 25, 1997, Mr. Delduca pled guilty to one count of worker's compensation 
insurance fraud, and one count of larceny over $250. Mr. Delduca also admitted to 
sufficient facts for a finding of guilty to one count of motor vehicle insurance fraud. 
He was sentenced to six months in the House of Correction, suspended for three years, 
and ordered to pay a $2,000 fine, $5,000 restimtion to Kemper and $1,000 resfitution 
to Horace Mann Insurance Company. 

Commonwealth v. Chrisopher Gabriel Perez (Suffolk Superior Court) - Christopher 
Gabriel Perez, along with four co-defendants, engaged in an insurance fraud scheme, 
consisting of motor vehicle and "slip and fall" claims, with numerous insurance 
companies over a period of several years. As part of their claims, the five sought and 
received payments from various insurance companies for lost wages to which they were 
not entitled. Mr. Perez was charged with two counts of motor vehicle insurance fraud. 
The charges against Mr. Perez resulted from his principal involvement in a fraudulent 
claim filed following a 1991 car accident and his assistance with the claims filed by 
his co-defendants. On August 26, 1997, Mr. Perez pled guilty to the charges and was 
sentenced to 6 months in the House of Correction, suspended for two years and ordered 
to perform 150 hours of community service. He also was required to pay $15,000 in 
restitution to one insurance company and $957 in investigative costs to another. 

Commonwealth v. Edwin Gaeta (Essex Superior Court/Lawrence) - Edwin Gaeta engaged 
in a pattern of fraudulent activities which began in 1988 with the purchase of a 
passenger bus which he converted into a passenger luxury vehicle he called the "Luxury 
Limousine." Mr. Gaeta forged the bill of sale which was presented to the Registry of 
Motor Vehicles in 1989 when the bus was registered in order to avoid paying more than 
$1,300 in use taxes. He then insured the bus for more than $128,000 with Safety 
Insurance Company. 

In June of 1990, Mr. Gaeta fraudulently reported to the Peabody Police and to Safety 
Insurance Company that the bus had been stolen. He subsequently collected 
approximately $120,000 in insurance proceeds. 

In September, 1991, Mr. Gaeta falsely reported to Liberty Mutual Insurance Company and 
the police that his 1983 Jaguar XJ-6 had been stolen. Mr. Gaeta collected nearly 
$10,000 from Liberty Mumal. Finally, in October of 1991, Mr. Gaeta falsely reported 



40 



that he had been rear-ended by a pick-up truck near Newbury, MA, and that when he got 
out of his car to exchange insurance information, the two men in the pick-up truck 
began shooting at him. He later submitted a claim to Liberty Mumal Insurance Company 
and was paid more than $3,000 for the alleged damage to his car. 

On March 11, 1998, Edwin L. Gaeta was convicted of eighteen charges which included 
forgery, motor vehicle insurance fraud, false reports of crime, tax evasion, and 
perjury. The Court sentenced Mr. Gaeta to a term of imprisonment to be served 
concurrently with the nine year federal sentence he presently is serving for 
loansharking, transferring machine guns, and drug trafficking. The Court also ordered 
Mr. Gaeta to be placed on ten year? of supervised probation following his release from 
prison. 

)THER INSURANCE FRAUD CASES 

Commonwealth v. Armand Arce (Hampden Superior Court) - Armand Arce, a 
former MetLife Insurance Company agent and president of Money Management Inc. 
of East Longmeadow, was convicted on ten counts of larceny over $250. Mr. Arce, 
while an insurance agent for MetLife in Holyoke, stole approximately $3 1 ,000 from 
clients, many of them elderly. Mr. Arce would convince his clients to cash in their 
life insurance policies to purchase new policies or mutual funds. After signing their 
insurance checks and turning them over to Mr. Arce, he deposited the checks into his 
owTi personal bank account and used the money for personal expenses. On June 1 6, 
1998, Mr. Arce was sentenced to four years of strictly supervised probation, ordered 
to pay $31,000 in restitution to MetLife and Security Connecticut (who already had 
reimbursed the victims) and prohibited from accepting any employment where he 
acts as a fiduciary advisor. 

Commonwealth v. Amantino Lopes (Dedham District Court) - Amantino Lopes was an 
attorney licensed to practice in the Commonwealth from 1987 until his license was 
temporarily suspended by the Board of Bar Overseers on February 5, 1997. Prior to this 
suspension, Mr. Lopes handled a large number of personal injury clients from the 
Greater Lowell area. Four of his clients reported that Mr. Lopes accepted 
approximately $17,000 in settlement checks from insurance companies on their behalf 
and failed to disburse these funds to them, in spite of their repeated requests that 
he do so. Mr. Lopes pled guilty to all four counts of embezzlement on September 30, 
1997. In April of 1998, Mr. Lopes was sentenced to 90 days in the House of Correction. 

Commonwealth v Sandra Gill (Lynn District Court) - Sandra Gill ran two businesses, 
Massachusetts Travel and the Sandra Gill Insurance Agency, in Lynn. Between 1993 and 
1995 she falsely represented herself as an agent of the Metropolitan Insurance Company 
and would accept insurance policy premiums on its behalf Ms. Gill never was 
authorized to conduct business on behalf of Metropolitan. All of the money that she 
received for these falsified premiums was deposited into her own business or personal 
accounts. Ms. Gill would complete her clients' applications for motor vehicle 



41 



registration by using a fraudulent Metropolitan insurance company seal and by forging 
the signature of an authorized Metropolitan agent. Ms. Gill admitted to stealing a 
total of $3,759.50 from her clients. On November 20, 1997, Ms. Gill pled guilty to 8 
counts of larceny and 6 counts of forgery. She received a 2 year sentence to the 
House of Correction, suspended for 2 years, and was ordered to pay $3,759.50 in 
restitution. 

Commonwealth v Yvette William and McKenson Charles (Somerville District 
Court) - From September, 1991 until November, 1994, McKenson Charles cashed Social 
Security Disability Benefit checks issued to a Bernard Williams. However, Mr. 
Williams had died in Port-Au-Prince, Haiti on September 8, 1991. An investigation 
conducted by the Social Security Administration Office of the Inspector General 
revealed that Mr. Charles forged, co-endorsed and/or negotiated eighteen checks 
totaling $9,733. Subsequently, Mr. Charles admitted to the Social Security 
Administration that he had cashed these checks and kept at least a portion of the 
proceeds for hunself. Ms. Williams' conduct was very similar, in that she would 
compete with Mr. Charles to take possession of the late Mr. Williams' checks in order 
to negotiate them for her own benefit. On October 20, 1997 and November 3, 1997, 
respectively, Ms. William and Mr. Charles admitted to sufficient facts to support 
charges of forgery, larceny over $250 and uttering. The matters were continued 
without findings: Ms. William for 2 years, v^th an order to pay $5,945 in restitution to 
the Social Security Disability Insurance ("SSDI") flmd; and Mr. Charles for 1 year, 
with an order to pay $6,432 in restitution to the SSDI fund. 

Commonwealth v. Max M. Podolsky (Suffolk Superior Court) - Max M. Podolsky was 
indicted after it was revealed that he had failed to declare other sources of income 
while he was collecting Social Security benefits from 1989 through 1997. This fraud 
was discovered during an investigation of allegations that Mr. Podolsky and four 
others had defrauded several insurance companies by filing false claims for lost 
wages. The earlier investigation resulted in Mr. Podolsky' s indictment on July 16, 
1996, by a Suffolk County Grand Jury on 13 counts of insurance fraud, motor 
vehicle insurance fraud, larceny and conspiracy. 

On February 12, 1998, Mr. Podolsky pled guilty to insurance fraud and larceny 
charges and was sentenced to 1 8 months in the House of Correction. One year was 
imposed for the insurance fraud, motor vehicle insurance fraud and larceny charges 
arising from the five fraudulent claims he filed between 1991 and 1993. An 
additional six month sentence was imposed on the four counts of larceny over $250 
for continuing to collect disability benefits from the Social Security Administration 
despite receiving over $40,000 in fraudulently-obtained insurance proceeds. 

Commonwealth v. Robert McMillen (Fall River District Court) - Robert P. McMillen, a 
tropical fish dealer, furnished false information to Merchants and Businessmen's 
Mutual Insurance Company and Worcester Insurance Company in order to receive insuranc 
benefits for alleged property damage. Mr. McMillen claimed that on two separate 



42 



occasions a salt water pump in his fish tank malfunctioned resulting in extensive 
property damage. Prior to paying the second claim, Worcester Insurance Company 
discovered that they already had paid this individual for a prior claim. Furthermore, 
the company discovered that all of the receipts submitted in support of both of the 
claims had been falsified. Mr. McMillen was charged with larceny over $250 and 
insurance fraud. On February 25, 1998, Mr. McMillen pled guilty to the charges and 
received a sentence on the insurance fraud count of 1 year probation with an order to 
pay restitution of $7,934. The three forgery counts were placed on file. All others 
charges were continued without a finding for one year. 



OTHER EFFORTS 



Harbor Tunnel/ Central Artery Project - During Fiscal Year 1998, the IFD 
participated in regular meetings with the legal counsel and administration of the 
Central Artery/ Harbor Tunnel Project ("Project"). The purpose of these meetings 
was to instruct Project management concerning the importance of carefiil and prompt 
investigation and reporting of suspicious or fraudulent claims, to develop reporting 
and investigation procedures for safety officers and to suggest ways of effectively 
working together with Project insurers to prevent and, if necessary, vigorously 
prosecute insurance fraud. 

City of Worcester Anti-Fraud Initiative - In an effort to lower Worcester's high car 
insurance rates, the Attorney General's Office and the City of Worcester launched a 
innovative pilot project to reduce auto accidents, accident-related injuries and 
insurance fi-aud. Members of the IFD have been working in partnership with 
municipal officials to increase police enforcement of traffic laws, improve roadways, 
roadway signage and traffic control markings, and provide training for law 
enforcement officials concerning investigation and reporting procedures for motor 
vehicle accidents. 

Commonwealth v. Burgess and Ricci - Discovery of IRS Returns - The IFD 
successfully argued before the Supreme Judicial Court a case which provides 
prosecutors with a significant tool for investigating and prosecuting fraud. The 
Court upheld the Commonwealth's ability to obtain, by court order, authorization 
from a criminal defendant in an insurance fraud case to receive copies of tax returns 
filed by that individual. The Court found that the compelled execution of forms 
authorizing disclosure of federal tax return information was not sufficiently 
"testimonial" for such an order to violate a defendant's privilege against 
self-incrimination as protected by the Fifth Amendment. 

Insurance Fraud Seminar - On June 18, 1998, the IFD, in cooperation with the 
Insurance Fraud Bureau, hosted and presented a seminar entitled "Staged and Jump- 
In Accidents: Premeditation and Opportunity" at the Holiday Inn in Worcester, 
Massachusetts. 

DIVISION STATISTICAL SUMMARY 



43 



CASES 

New Cases Charged in FY98 

- Motor Vehicle Ins. Fraud 28 

- Workers' Compensation Fraud 14 

- Insurance Fraud 9 

- Multiline (W/C + MA^) 2 

- Other Insurance Fraud A 

59 

Cases Closed in FY98 

- Motor Vehicle Ins. Fraud 24 

- Workers' Compensation 13 

- Other Insurance Fraud 16 

53 



44 



MEDICAID FRAUD CONTROL UNIT 

The Attorney General's Medicaid Fraud Control Unit ("MFCU") investigates and 
prosecutes health care providers that engage in patterns of fraud, waste and abuse committed 
against the Commonwealth's $4 billion Medicaid program. 

During Fiscal Year 1998, the Unit's white-collar-crime prosecutors and investigators 
brought several enforcement actions against a variety of health care providers including 
physicians, dentists, psychiatrists, pharmaceutical companies and nursing homes. In particular, 
the MFCU brought a new anti-kickback case against a pharmarceutical company, its eighth such 
action since 1994 against drug manufacturers which have entered into illegal financial 
arrangements. These cases have resulted in a $1 million return to the Medicaid program. 

The MFCU also is responsible for investigating and prosecuting those that abuse, neglect 
and/or mistreat the elderly and the disabled that reside in the Commonwealth's 550 Medicaid 
fimded long-term care facilities. This year, the MFCU investigated hundreds of incidents 
involving allegations of abuse and sexual assault against the Commonwealth's most vulnerable 
citizens. In some instances, the Attorney General called upon his State Police Unit to arrest 
perpetrators that had defaulted at court or otherwise fled the jurisdiction. 

Formed within the Attorney General's Office in 1978, the MFCU is celebrating twenty 
years of fighting health care fraud in Massachusetts. Nationally recognized for its law 
enforcement efforts, the Massachusetts MFCU has returned $43 million to the Commonwealth's 
Medicaid program over the last twenty years. In the last eight years alone, under the leadership 
of Attorney General Scott Harshbarger, the MFCU has recovered $28 million for the 
Commonwealth and it has obtained 332 convictions. 

HIGHLIGHTED EFFORTS 

& 

SIGNIFICANT ACTIVITIES 

PHYSICIANS 

• Worcester Psychiatrist - After a three week trial, a Worcester psychiatrist was 

convicted for defrauding the Commonwealth's Medicaid program of at least 
$165,000 by billing for more than 24 hours worth of work per day and charging 
the state for work while on vacation or at conferences. 

Dr. Lorin Mimless, a resident of Providence, RI, was sentenced to one year in the 
House of Correction after he was convicted of 2 1 9 counts of Medicaid false 
claims, and two counts of grand larceny. Dr. Mimless also was ordered to serve 
five years probation after the year in the House of Correction, and to pay 



45 



restitution of $165,843 plus 12 percent interest accruing from and after February 
1996. The sentence currently is stayed pending appeal. 

Since 1993, Dr. Mimless had charged the Medicaid program for more than 
$800,000 worth of services. The MFCU proved at the trial, however, that Dr. 
Mimless billed the state Medicaid program for work he was supposedly 
conducting in Worcester at times when he was really in places such as New 
Orleans, Santa Fe, Alaska, San Francisco, Florida, California or Nantucket, either 
on vacation or at conferences. In addition, Dr. Mimless billed Medicaid and its 
mental health and substance abuse subcontractor. Mental Health Management of 
America, for more than 24 hours worth of visits per day on at least 147 separate 
days. In some cases, the defendant billed the program for more than 50 hours of 
work for a single day. 

Boston Psychiatrist - A Boston physician who practiced in Leominster was 
sentenced to two years in jail after he was convicted of illegally prescribing 
addictive narcotics to drug-dependent patients and billing them to the Medicaid 
program. 

The sentence issued in Worcester Superior Court sent Albert D. Pike, M.D., who 
lived in Boston, to the Worcester County House of Correction for two years 
following the October 31, 1997 convictions against him for illegal distribution of 
a Class B substance, illegal distribution of a Class C substance, and filing false 
Medicaid claims. Dr. Pike was also sentenced to two-and-a-half years probation 
following the two-year sentence, and ordered to pay $9,000 in fines. The sentence 
currently is stayed pending appeal. 

The charges, originally brought in December 1995, were the result of an 
investigation by the Medicaid Fraud Control Unit, the Massachusetts Board of 
Registration in Medicine and the Federal Drug Enforcement Administration. The 
charges were brought against Dr. Pike based on his treatment of 10 patients 
between 1992 and 1995. 

Revere Doctor - A Revere physician paid $46,885.98 to settle allegations that he 
illegally overbilled Medicaid. In addition, he will refire from practicing medicine 
and withdraw as a provider of Medicaid program services. 

The Commonwealth's two-count complaint, filed by the MFCU in Suffolk 
Superior Civil Court, alleged that Mohammed H. Ordubadi, M.D., and his 
personal practice, Ordubadi Clinics, Inc., submitted false Medicaid claims and 
engaged in fraudulent and deceitful practices in their Medicaid Program billings 
from January 1, 1994 to December 31, 1996. 

During that period, Dr. Ordubadi is alleged to have defrauded Medicaid by billing 
for services he never performed and by upgrading or upcoding services he did 



46 



DENTISTS 



perform so that he was paid more than he was entitled to receive. The 
Commonwealth's investigation identified more than $46,000 in fraudulent 
billings submitted by Dr. Ordubadi to the Medicaid Program, including billing for 
repeated short, simple, follow-up office visits as if they were long, medically 
complicated visits. 

In addition to the complaint filed in court. Dr. Ordubadi also entered into a 
settlement agreement with the Attorney General whereby Dr. Ordubadi and his 
company paid full civil restitution of $46,885.98 to the Medicaid program. Dr. 
Ordubadi also agreed, effective January 31, 1998, to forever cease the practice of 
medicine in Massachusetts and to vsdthdraw from the Medicaid program as a 
provider of medical services. 

North Dartmouth Practice - Three North Dartmouth allergy specialists agreed in a 
civil settlement with the MFCU to pay restitution of $35,000 to the Medicaid 
program over disputed Medicaid billing practices. 

John Noyes, M.D., Bruce Goldstein, M.D., and S. David Miller, M.D., through 
their medical practice. Allergy Associates, Inc., paid $35,000 to resolve alleged 
billing discrepancies uncovered during an investigation by the MFCU. 



Sharon Psychiatrist - A Sharon psychiatrist agreed to reimburse Medicaid 
$1 50,000 for the over billing of therapy sessions he conducted at the North 
Cottage Program in Norton. 

The MFCU filed a civil law suit in Suffolk Superior Court against Joshua Paul 
Golden, M.D., of Sharon, alleging that he falsely billed Medicaid for drug and 
alcohol treatment coimseling services. The focus of the investigation was Dr. 
Golden's billing of Medicaid for individual psychiatric services, when he actually 
treated the recipients in group therapy sessions. 



Marblehead Dentist - A Marblehead dentist with a practice in Swampscott pled 
guilty to charges she stole thousands of dollars from the state's Medicaid 
program, as well as received welfare benefits to which she was not entitled. 

Natalya Veksler, of Marblehead, pled guilty in Suffolk Superior Court to charges 
of filing false Medicaid claims, larceny over $250, making false representations to 
procure public support and larceny by false pretenses. She was sentenced to one 
year in the House of Correction suspended, with two years probation, and ordered 
to pay $30,000 in fines and $30,000 in resfitution. She is also excluded from 
ftiture participation in the Medicaid program. 

Dr. Veksler had been a Medicaid provider in the Commonwealth since June, 
1995. During that time, she had received more than $400,000 in Medicaid 



47 



payments for work on Medicaid beneficiaries. After reviewing her billings, the 
MFCU determined that Dr. Veksler claimed an extraordinary number of dental 
services performed for clients, whereas only a fraction of the work had actually 
been performed. 



PHARMACIES 



Fitchburg Pharmacist - A Fitchburg pharmacy and its owner pled guilty in 
Worcester Superior Court to 30 counts of defrauding the state Medicaid program. 

Charles Petalas of Bedford, New Hampshire, the owner of Laurel Street 
Pharmacy, was sentenced to one year in the House of Correction, two years 
probation, and assessed fines and restitution totaling $5,000. In addition, Petalas 
lost his right to participate in the state and federal Medicaid and Medicare 
programs. 

Investigators from the MFCU focused on pharmacy claims submitted to the 
Division of Medical Assistance by Petalas for medications and supplies not 
delivered or administered to at least eleven residents of the Grand View Rest 
Home, in Fitchburg, from 1993 to 1995. 

Northampton Pharmacv - A Northampton pharmacy agreed to pay $60,000 to 
settle allegations that from January, 1994, thru July, 1995, it was not in 
compliance with Medicaid and federal regulations regarding prescription drugs. 

As a result of a joint investigation with the MFCU, the United States Attorney's 
Office, and the State's Division of Medical Assistance, Serio's Pharmacy of 
Northampton will pay $60,000 to resolve allegations that it improperly ordered 
and dispensed prescription medications without obtaining a written prescription 
from a physician, billed for unauthorized prescription refills and inappropriately 
stored and disposed of prescription products. 

The investigation covered an 18-month period and focused on the pharmacy's 
relationship with several western Massachusetts nursing homes. Investigators 
identified several hundred instances where the pharmacy had billed Medicaid 
without obtaining written physician ordered prescriptions, and also was in 
violation of federal rules and regulations relating to the dispensing of prescription 
drugs. 

Delaware Pharmaceutical Companv - A national drug manufacturer agreed to a 
$100,000 settlement over allegations that the company's promotional practices 
violated the Massachusetts Medicaid anti-kickback statutes. 

Mallinckrodt Chemical, Inc., a Delaware pharmaceutical manufacturer and 
distributor to Massachusetts chain pharmacies and other pharmacies, allegedly 
offered rebates of up to $3.5 million to two pharmacy chains if they converted 
from compefitors' products to Mallinckrodt' s product line. 



48 



Mallinckrodt has agreed to discontinue its rebate program. Furthermore, the 
company will not engage in agreements in which it offers lump-sum payment 
imrelated to the volume of product ordered or because a pharmacy converts to 
Mallinckrodt's product line. Mallinckrodt also has agreed to distribute a 
corporate compliance plan addressing health care fraud and abuse in an effort to 
ensure futiu^e compliance with federal and state laws. 

Dorchester Pharmacy - A Dorchester Pharmacy has agreed to reimburse the 
state's Medicaid program $70,000 for allegedly billing for pharmaceuticals it did 
not provide and billing Medicaid at an inflated rate. 

The MFCU filed a civil complaint, consent judgment and agreement for judgment 
in Suffolk Superior Court against Kimmy Pharmacy of Dorchester. 

The complaint alleges that over a four year period, Kimmy Pharmacy, and its 
owner Tuan Q. Tran, billed Medicaid and received payment for prescription and 
non-prescription drugs at a rate higher than the customary rate they billed to other 
insurance companies. The complaint also alleges that the pharmacy billed and 
received payment for drugs that were not furnished by billing Medicaid for larger 
quantities that were actually dispensed. Kimmy Pharmacy also violated Medicaid 
regulations by receiving payment for prescription drugs without first obtaining 
proper physician documentation. 

According to the settlement filed by the MFCU, the pharmacy will pay $70,000 in 
civil restitution to the Massachusetts Medicaid program to settle all allegations 
brought by the Attorney General's Office. The pharmacy also will institute a 
compliance billing plan to insure that the pharmacy's bills are checked for 
accuracy before they are sent to the Division of Medical Assistance for payment. 



HEALTH CARE COMPANIES 



National Emergency Room Settlement - The MFCU participated in a $7.75 
million national settlement with a Texas-based company accused of overbilling 
Medicaid for emergency room physician services. 

The National Association of Medicaid Fraud Control Units, which worked closely 
with the Department of Justice to resolve the matter, announced its settlement of 
a lawsuit with EmCare, Inc., a Texas company, which operates emergency room 
physician services nationwide. The suit alleged that EmCare's Oklahoma-based 
billing service. Emergency Physicians Billing Services (EPBS), routinely 
overstated the emergency room services EmCare provided to patients between 
1992 and 1996. 

Massachusetts received $51,283 in connection with the settlement. 

Marlborough Home Health Care and Pharmacy Company - A Marlborough home 
health care and pharmacy company will reimburse the Massachusetts Medicaid 



49 



program $195,000 to settle allegations of prescription drugs billing violations. 

Quantum Health Resources, Inc., which was purchased by Olsten Health 
Resources in 1 996, entered into a settlement agreement with the Attorney 
General's office to resolve charges that, from March, 1994, through February, 
1998, it over billed Medicaid for extra units of prescription drugs, billed Medicaid 
the full price for prescription products that were discounted by the manufacturer 
and could not produce delivery verification reports. 

Quantam also was cited for allegedly billing the wrong Medicaid recipients and 
for failing to have the proper documentation to support refills to certain recipients. 
In total, the MFCU investigators identified hundreds of situations where Quantum 
had allegedly billed Medicaid without producing valid documentation. 

The $195,000 payment to Medicaid will resolve all of the allegations brought 
against Quantam by the Attorney General's Office and the Massachusetts 
Division of Medical Assistance. 



KICKBACKS 



Norwood Pharmacy - A Norwood pharmacy will pay $100,000 to settle 
allegations that it illegally billed the Massachusetts Medicaid program and was 
involved in illegal financial arrangements with several area nursing homes. 

The MFCU filed a complaint and settlement agreement in Suffolk Superior Court 
against MediSave Pharmacies, Inc., of Norwood. The pharmacy delivered 
pharmaceutical and non-pharmaceutical supplies to Medicaid recipients residing 
in long term care facilities, while illegally providing nursing homes with 
discounts, rebates, equipment and other services. 

The complaint further alleges that MediSave wrongfully billed Medicaid for 
dispensing, billing and receiving payment for drugs without first obtaining an 
authorized written prescription. The pharmacy also allegedly billed Medicaid for 
certain items at prices higher than the usual and customary prices that it charges to 
non-Medicaid customers. 

MediSave will pay $100,000 in civil resfitution to the Commonwealth and has 
agreed to take corrective action for these billing problems. 



DURABLE MEDICAL EQUIPMENT 



Agawam Company - An Agawam company pled guilty in Suffolk Superior Court 
to charges of submitting false claims to the Massachusetts Medicaid program. 

Bio-Care Inc., a durable medical equipment company, through its owner, Derek 
Panaia, of Agawam, pled guilty to one count each of submitting false Medicaid 
claims and larceny of more than $250. The Court ordered the company to pay 



50 



$45,000 in fines and restitution. 

From November, 1994, through March. 1995, Bio-Care submitted false Medicaid 
claims for items delivered to four patients at the Northampton Nursing Home, an 
acute care skilled nursing facility. Bi-Care submitted double bills for items 
including catheter kits, drainage sponges, saline solution, sterile water, and 
tracheal kits, provided to the fotir recipients. 

In a separate agreement, Derek Panaia, Bio-Care's president, will pay $105,000 to 
the Medicaid program to settle allegations he submitted fraudulent bills. The 
payment of $105,000 resolves all allegations brought against Panaia by the 
Division of Medical Assistance. Panaia and his company have also agreed to a 
permanent ban from the Medicaid program. 



NURSING HOMES 



Lexington Nursing Home Chain - A Lexington nursing home chain paid $25,000 
to settle allegations in a Suffolk Superior Court civil complaint filed by the 
MFCU that it illegally accepted a financial arrangement from a pharmaceutical 
company, in which the chain got free equipment and discounts of pharmaceuticals 
in exchange for ordering goods and services. Medisave Pharmacies, Inc., of 
Norwood was supplying free equipment and discounts on some pharmaceuticals 
for Medicaid recipients residing at the Lexington-based Beverly Ent-Mass, Inc.'s 
1 3 nursing homes and long-term care facilities. 

Everett Nursing Home - The Woodlawn Nursing and Rehabilitation Center of 
Everett agreed to pay more than $15,000 to settle allegations involving the 
possible mismanagement of ftinds that were meant to benefit their patients. 

The settlement agreement resolves a MFCU investigaUon in which the nursing 
home was accused of mishandling a bank account that was specifically designated 
for the personal needs of its patients. The terms of the settlement require the 
nursing home to pay restitution in the amount of $3,800 to the patient's Personal 
Needs Allowance account, as well as $12,000 in civil penalties, administrative 
fines and investigafive costs. In addition to the restitution and fines, the 
settlement includes an agreement that Woodlawn will hire an independent 
certified public accountant to examine the patients' account every three months 
for the next two years. A copy of these quarterly reports must be submitted to the 
Attorney General's Office for review until December 31, 1999. 

Braintree and Worcester Nursing Homes - The Elihu White Nursing Home of 
Braintree and the Mill Hill Nursing Home of Worcester agreed to pay nearly 
$15,000 to settle allegations involving the possible mismanagement of funds that 
were meant to benefit their patients. 

The settlement agreement resolves an investigation in which the nursing home 
was accused of mishandling a bank account that was specifically designated for 



51 



the personal needs of its patients. The terms of the settlement require the nursing 
homes to pay restitution to the patient's Personal Needs Allowance account, as 
well as civil penalties, administrative fines and investigative costs. 

These settlements also include an agreement that the nursing homes will hire an 
independent certified public accountant to examine the patients' account every 
three months for the next two years. A copy of these quarterly reports must be 
submitted to the Attorney General's Office for review until December 3 1 , 1999. 



ELDER ABUSE 



New Bedford Nurses Aide - A New Bedford man was sentenced to probation in 
Wareham District Court on charges that he physically assaulted and abused a 
patient at a Wareham nursing home. 

Benjamin Bums, a certified nurses' aide at the Millbrook Nursing Home in 
Wareham, MA, was charged with one count of patient abuse and one count of 
assault and battery. On March 26, 1996, Bums stmck a 73 year-old patient, who 
suffered from bi-polar manic depressive behavior and heart disease, in the face 
while he cared for him. A nurse employed at the home was a witness. 

Waltham Nursing Aide - Claudette Sanon, fi-om Waltham, pled guilty to one 
count of indecent assault and battery, and one count of patient abuse in Cambridge 
District Court on charges that she physically assaulted and abused a patient at a 
Watertown nursing home. She was sentenced to one year of probation and 
revocation of her certified nurses' aide license. 

In 1996, Sanon was a certified nurses' aide at the Charlesgate Manor 
Convalescent Home. Sanon admitted to assaulting an eighty-one year old woman 
who was in her care during September and October. 1 996. The victim was 
suffering from the affects of a stroke as well as residual dementia, seizures, 
osteoporosis and osteoarthritis. Three nursing home employees witnessed the 
assaults. 

Framingham Nurses Aide - Sudesh Kumar Budhiraja, from Framingham, pled 
guilty in Framingham District Court to one count of patient abuse and one count 
of indecent assault and battery on charges that he sexually assaulted and abused a 
patient in a Holliston nursing home. He was sentenced to one year in a House of 
Correction, suspended for two years. As part of the sentence, he is prohibited 
from working in the health care field, and must register as a sex offender with the 
Framingham Police Department. 

Budhiraja, a former certified nurse's aide employed at the Holliston Manor 
Nursing Home, sexually assaulted a 67 year-old female patient on September 9, 
1997. The patient, already suffering from bi-polar depression and dementia, 
suffered severe stress and fear because of the assault. Another nursing home 
employee witnessed the incident. 

Rhode Island Man - John L. Pascua, of Pawtucket, Rhode Island, pled guilty in 



52 



Attleboro District Court to one count of indecent assault and battery on charges 
that he sexually abused an elderly patient at an Attleboro nursing home. Pascua 
was sentenced to one year in the House of Correction suspended for 1 8 months, 
with 1 8 months of supervised probation. He was ordered to submit to a 
psychological evaluation, undergo counseling, turn in his nurse's aide license, and 
stay away from the victim. 

Pascua is also prohibited from accepting a paid or volunteer position in the health 
care field in Massachusetts. In addition, Massachusetts law requires Pascua to 
register as a sex offender with the local police departments where he works and 
resides. 

Pascua was a nurse's aide at the Ridgewood Court Nursing and Rehabilitation 
Center when, on March 20, 1 996, a visitor witnessed Pascua fondling the breast of 
an eighty-one year-old female resident as he kissed her on the mouth. The 
witness reported the incident to the management of Ridgewood Court and the 
Department of Public Health. 

Pascua failed to appear at his arraignment in January, 1998. He was arrested in 
March, 1998, by State Police assigned to the Attorney General's Office. 

DIVISION STATISTICAL SUMMARY 

STATISTICAL SUMMARY 

Formal Investigations Initiated 83 

Investigations Completed and Closed 68 

Individual Indictments 24 

Convictions 20 



PATIENT ABUSE/NEGLECT CASES 

Abuse & Neglect Referrals 541 

Abuse & Neglect Investigations 266 

Total Criminal Complaints & Indictments 6 

Prosecutions Completed and Closed 3 

Individuals Convicted 3 

Pending Prosecutions 16 



CIVIL/CRIMINAL FINANCIAL RECOVERIES 

Number of Civil Recovery Cases 55 

Number of Criminal Recovery Cases 6 

Civil Recovery $1,1 99,624.50 

Criminal Recovery $259.939.16 

Total Recovery $1,459,563.66 

53 



Training, Enforcement, Education and Outreach Initiatives 

The Medicaid Fraud Control Unit continued to ensure that its staff emphasized the use of 
the most 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 and the Attorney General's 
Comprehensive In-Service Investigators Training. 

Recognizing that the vast majority of healthcare providers are eager to provide quality 
healthcare, the MFCU continued to educate the provider community regarding"Medicaid 
Program Regulations, their applications to fraud alerts and the use of effective corporate 
compliance plans. 

In pursuit of those providers that operate outside legal boundaries, the MFCU has 
participated with several enforcement associations, as reported below, to seek systemic solutions 
to healthcare fraud: 

• The National Association of Medicaid Fraud Control Units ("NAMFCU") - The 
Directors from Medicaid Fraud Control Units across the nation met regularly to discuss 
emerging trends in fighting healthcare fraud. In conjunction with the Federal Department 
of Justice, NAMFCU brought several prosecutions against healthcare corporations that 
resulted in millions of dollars returned to the Medicare and Medicaid programs 
nationwide. The Association also contributed to Attorney General's Elder Summit 
Conference which brought together experts nationwide to profile innovative ideas for 
protecting the elderly from a variety of common frauds, neglect, abuse and exploitation. 

• The Northeast Healthcare Law Enforcement Association ("NHLEA") - Consisting of 
chief investigators from New England Medicaid Fraud Control Units, including New 
York and New Jersey, the Massachusetts State Police Diversion Investigative Unit and 
federal law enforcement agencies including the Drug Enforcement Administration, the 
Federal Bureau of Investigations, the Internal Revenue Service and the Office of 
Inspector General, the NHLEA shares investigative strategies and develops joint 
state/federal health care fraud investigations and prosecutions. The NHLEA also 
sponsors quarterly training programs such as this years Computer Investigations in a 
Healthcare Environment and Durable Medical Equipment Invoicing Fraud . 

• Drug Diversion Issues - MFCU representatives, along with the Federal Drug Enforcement 
Agency and the Board of Registration in Medicine and Pharmacy, work with various state 
and federal agencies concerning drug diversion investigation issues including the sharing 
of investigative resources to develop comprehensive prosecutions. In June, 1997, the 
Attorney General and the MFCU were recognized for outstanding contributions to the 
drug enforcement effort in Massachusetts with a distinguished service award from the 
Federal Drug Enforcement Administration. The award is the result of an on-going 
relationship with the Drug Enforcement Agency, the Federal Bureau of Investigations, 
and the Massachusetts State Police in the coordination of white collar crime 
investigations. 



54 



Bureau of Special Investigations - The MFCU's Chief Investigator meets with 
representatives from the Bureau of Special Investigations of the Massachusetts 
Department of Transitional Assistance to discuss welfare fraud, referrals and inter-agency 
investigations involving Medicaid recipients. 

Division of Registration - Health Care Fraud Unit - The MFCU coordinates enforcement 
actions with representatives from the Massachusetts Division of Health Care Fraud Unit, 
which brings complaints against health care professionals before various professional 
licensing boards. 

Department of Public Health - The MFCU's Patient Abuse Prosecution Coordinator 
meets regularly with the officials from the Massachusetts Department of Public Health to 
discuss issues affecting the monitoring rtnd 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 Attorney General'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 Massachusetts 
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 



CRIMINAL BUREAU 

The mission of the Criminal Bureau is to further the interests of the citizens of the 
Commonwealth, and advance the law enforcement priorities of the Attorney General through the 
prosecution of criminals and the development of sound criminal justice policy. As a 
prosecutorial organization, the Bureau is comprised of highly-specialized legal teams and 
forensic resources available to prosecutors, police, and the public. 

Attorney General Harshbarger's Criminal Bureau has a specific and important function 
within Massachusetts' law enforcement. Certain types of criminal litigation, such as 
environmental crime, require substantial knowledge of the Commonwealth's regulatory 
framework as well as specialized technical information. 

Expert forensic resources may also be critical. White collar and other financial crimes 
can be difficult to detect without a team of CPAs, auditors, and tax lawyers. Inquiries into the 
betrayal of the public trust by public employees is a necessary part of the important work done in 
the Criminal Bureau. 

Criminal enterprises involving narcotics, Internet crime, and gun trafficking often cross 
county lines and may be best litigated by prosecutors with state-wide jurisdiction. Highly 
sophisticated undercover operations are utilized. in all of these investigative endeavors. 

The Criminal Bureau's endeavors include the Safe Neighborhood Initiative (SNI), a 
collaborative community prosecution effort uridertaken by Attorney General Harshbarger with 
the Boston Police Department, the Boston Mayor's Office, the Suffolk County District 
Attorney's Office, the U.S. Attorney's Office, and community residents. During the past five 
years, the SNI has been found to reduce crirrYe, increase economic stability, and improve the 
quality of life in the neighborhoods where it has been established. The SNI operates on a 
community prosecution model now in place in Dorchester, Roxbury, Chelsea and Brockton. The 
SNI concept has been considerably expanded during the past year as v^ill be seen in this Report. 

In addition to combating urban violence and reducing crime. Attorney General 
Harshbarger's other law enforcement priorities have included protecting vulnerable victims, 
particularly the disabled and elderly, fighting financial fraud and the "fraud tax", and making 
government work for all of its citizens. The resources of the Criminal Bureau have been 
channeled in ways that have fiorthered these priorities as will be seen in the individual division 
reports. 

I 

Assistant attorneys general in the Criminal Bureau who are trial lawyers represent the 
Commonwealth in criminal prosecutions throughout the state, primarily in the areas of economic 
crime, public corruption, environmental and computer crimes, and narcotics violations. On the 
appellate side, assistant attorneys general conduct post-conviction proceedings, including 
representing the Commonwealth in appeals of criminal convictions, and defending against 
federal habeas corpus challenges to state criminaliconvictions. They also appear on behalf of 
state officials, members of the judiciary, prosecutors, and other law enforcement agents named as 
defendants in state and federal civil suits generated by prisoners. Assistant attorneys general in 
the Bureau fiirther serve the public by responding to inquiries and complaints on myriad issues 



56 



from citizens, reviewing extradition documents from executive officers of the 50 states, and 
sponsoring and participating in training programs on criminal justice issues. 

The chief of the Criminal Bureau is Frances A. Mclntyre, a veteran trial lawyer who 
provides direction and leadership to the prosecutorial teams. She is assisted by Deputy Chief 
Mark D. Smith who, in addition to tr>'ing cases, supervises all investigations and litigation of the 
Criminal Bureau. Deputy Chief Susan Spurlock administers the community prosecution efforts 
of the Safe Neighborhood Initiative, and advises the Bureau Chief on personnel matters. 

The Criminal Bureau is organized into six divisions or teams which reflect their 
specialization and expertise; each of these teams is directed by a highly skilled manager. 
Assistant Attorney General Pamela L. Hunt serves as the chief of the Appellate Division. 
Assistant Attorney General Carol A. Starkey sei-ves as the chief of the Economic Crimes 
Division. Assistant Attorney General Martin E. Levin serves as the chief of the Environmental 
Crimes Strike Force. Assistant Attorney General Jeremy Silverfme serves as the chief of the 
Public Integrity Division. Assistant Attorney General Robert N. Sikellis serves as the chief of 
the Narcotics and Special Investigations Division; this division also includes the Asset Forfeiture 
Unit and the High Tech Crime Unit. Paul Stewart, CFE, is the director of the Financial 
Investigations Division. Massachusetts State Police Captain John D. Kelly is the commanding 
officer of the Attorney General's Criminal Investigations Division. 

There are also two Bureau Attorneys in the Criminal Bureau. Mary A. Phillips, Bureau 
Attorney for Training and Administration, coordinates the Attorney General's grand jury process 
throughout the Commonwealth, develops training programs for the Criminal Bureau, serves as 
Chair of the Training Committee for the Office of the Attorney General, and advises the Bureau 
Chief on administrative and budgetary matters. Elisabeth J. Medvedow, Bureau Attorney for 
Policy and Legislation, develops and coordinates criminal justice initiatives, reviews and drafts 
legislation affecting the criminal justice system, writes amicus briefs in cases of statewide 
significance, and edits the Law Enforcement Newsletter, a publication distributed to judges, 
prosecutors and police to keep the law enforcement community apprised of recent developments 
in criminal law. 

Currently, there are 40 prosecutors, eight financial investigators, eleven support staff, a 
paralegal, a victim witness advocate, three program coordinators for the Safe Neighborhood 
Initiative, and several volunteer attorneys in the Criminal Bureau. In addition, 32 members of 
the Massachusetts State Police are assigned to the Bureau to investigate criminal conduct in the 
Commonwealth. 

APPELLATE DIVISION 

The Appellate Division handles a wide variety of criminal, federal habeas corpus, state 
habeas corpus and other civil cases which impact criminal prosecutions and the criminal justice 
system. The Division's caseload includes appeals ind post-convictions matters in criminal cases 
prosecuted at the trial level by the Attorney General's office and from convictions of criminal 
contempt throughout the Commonwealth; all habeas corpus petitions filed in federal court that 
challenge Massachusetts convictions, parole surrerders, civil commitments, and renditions, and 
appeals in the First Circuit Court of Appeals from ihe denial or granting of habeas corpus relief 
The Division also engages in civil litigation defendng judges, clerks, probation officers and 
other court personnel, District Attorneys, Assistant District Attorneys and other prosecutorial 



57 



personnel sued civilly in state or federal court for actions taken during the criminal justice 
process. The Assistant Attorneys General in the Division defend the constitutionality of 
criminal statutes and challenges to statutes, court rules, practices and procedures concerning all 
aspects of the criminal justice system, represent the interests of prosecutors when subpoenaed to 
testify or provide documents in civil cases, supervise agency staff attorneys handling litigation 
involving the Department of Correction and the Parole Board, and handle appeals and federal 
court litigation concerning the Parole Board. 

In the last seven years, the Appellate Division has experienced a marked increase in its 
caseload due, in part, to an expanded assumption of responsibility for representing the interests 
of the state's prosecutors in both the criminal and civil arenas. During FY 1998, well over half 
of the cases handled by the Division concerned District Attorneys' offices in some way. 
Through centralization in the Appellate Division of all litigation concerning the state's 
prosecutors, involvement in non-traditional ways in cases affecting the validity of convictions or 
impacting the criminal justice system, creative use of the Anti-Slapp statute, its amicus brief 
program and participation in other criminal justice ini.iatives, the Division plays a leadership role 
in the Commonwealth and is able to make full use of its expertise in criminal law and procedure. 

Federal habeas corpus litigation accounts fo- a significant portion of the Division's 
caseload. The passage by Congress of the 1996 anjendments to the federal habeas corpus statute 
has resulted in a substantial increase not only in th: number of petitions filed by Massachusetts 
prisoners, but also in the amount of work requiri;(' to defend these cases. The Appellate Division 
has been particularly successful in defending aga'nst habeas corpus challenges. Since 1991, of 
the more than 660 federal habeas cases resolved only four were ultimately unsuccessful. 

In addition to their case work, Divisio i ittomeys participate in and present training 
programs both for the Criminal Bureau and on ce-wide, as well as provide assistance to other 
Criminal Bureau attorneys on a variety of mati^rs, including investigations, motions, trials, post 
conviction proceedings, and single justice ai t jns. The Division also works closely with the 
District Attorneys' offices, especially their A-'pellate Divisions, in identifying and acting as a 
clearinghouse on criminal law issues of state'.\ide importance and interest. 

During FY 98, the following attorneys ard support personnel were assigned to the 
Appellate Division for part or all of the year: \niiette Benedetto, AAG; William Duensing, 
AAG; David Edmonds, AAG; Ellyn Lazar, /vAO; Susanne Levsen, AAG; Gregory Massing, 
AAG; William Meade, AAG; Cathryn Nerves, AAG; Kenneth Steinfield, AAG; Pamela Hunt, 
Division Chief; Katherine DiGennaro, Pa'? legal; Suejeanne Koh, Paralegal; Theresa Kachmar, 
support staff; Sheila Rosselli, support staff Breiia Toland, support staff, and Kelli Murray, 
support staff. 

I. APPELLATE JIVIJ-rON CASE STATISTICS 

A. Cases Handled 

In fiscal year 1998, Appellate Division romeys handled 721 cases, approximately the 
same number as in FY97 and more than 68% g eater than the number of cases handled in FY92. 
Over 360 new cases were opened and 365 were -i solved during the year. There has been an 
increase in every kind of case handled by the D / sion. Compared to cases handled in FY92, 
there has been a 91% increase in federal habea* ; jrpus cases, 23% increase in federal civil cases, 
22% increase in state habeas corpus cases, 38°/. increase in state civil cases, 40% increase in 



58 



cases brought before the single justice session of the Supreme Judicial Court, and a 296% 
increase in criminal cases. 

The number of new cases opened by the Appellate Division has steadily increased for the 
last seven years, despite the fact that increasing numbers and types of cases have been referred to 
agency counsel to handle under the supervision of the Appellate Division. The 360 new cases 
opened in FY98 is a 125% increase over the 161 new cases opened in FY91 . In addition, in 
FY98, 191 cases were referred by the Appellate Division to agency counsel at the Department of 
Correction or the Parole Board who defend these cases as Special Assistant Attorneys General, to 
the District Attorneys, or the various sheriffs department. 

The following is an outline of the case activity for the Appellate Division for FY98: 





Cases Opened 


Cases Disposed 


Total Cases Handled 


A. Federal Habeas 


152 


145 


281 


B. Federal Civil 


27 


36 


52 


C. State Civil 


70 


88 


177 


D. State Habeas 
Corpus 


30 


30 


56 


E. Criminal 


45 


57 


107 


F. 211, §3 and Other 
Single Justice Cases 


25 


22 


35 


G. Other 


11 


9 


13 


TOTALS 


360 


365 


721 



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



FY1998 


FY 
1998 


FY 
1997 


FY 
1996 


FY 

1995 


FY 
1994 


FY 
1993 


FY 

1992 


FY 
1991 


Total Cases Opened 


360 


343 


344- 


341 


307 


351 


222 


161 


Total Cases Disposed 


365 


370 


406 


515* 


213 


282 


206 


N/A 


Total Cases Handled 


721 


715 


778' 


747 


652 


649 


428 


N/A 



*Includes 125 old cases. 



B. 



Briefs 



During FY 1998, the Appellate Division filed 57 appellate briefs in the United States 
Supreme Court, Court of Appeals for the First Circuit, Supreme Judicial Court and 
Massachusetts Appeals Court. Thirty seven other states joined in an amicus brief filed in 



59 



the United States Supreme Court successfully arguing that the double jeopardy clause does not 
apply to sentence enhancement hearings in noncapital cases. Another brief was written at the 
request of the Supreme Court in opposition to a petition for certiorari in a federal habeas corpus 
case challenging a murder conviction. After briefing, certiorari was denied. 

Fourteen briefs were filed in the United States Court of Appeals for the First Circuit, 
primarily in federal habeas corpus cases, but also in appeals fi-om the dismissal of civil lawsuits. 
In FY98, 15 briefs were filed in the Supreme Judicial Court in a variety of criminal and civil 
cases including an appeal fi-om a verdict that an individual was no longer a sexually dangerous 
person; the interpretation of the public duty rule and meaning of certain immunity provisions of 
the Massachusetts Tort Claims Act; whether there is a right to appeal to a judge if a clerk 
magistrate denies the issuance of a criminal complaint; and the procedure to follow in a joint 
criminal trial where one defendant wishes to proceed without a jury. In one case, the Division 
wrote a brief defending the practice of the Appeals Court and Superior Court to require indigent 
prisoners, who can do so, to pay a partial nominal filing fee in order to bring civil lawsuits. The 
26 briefs filed in the Appeals Court involved a number of criminal appeals as well as civil and 
state habeas matters. 

The Appellate Division continued its practice of filing 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 responsibility as the chief law enforcement 
officer of the Commonwealth. To that end, in addition to the amicus brief filed in the United 
States Supreme Court, Division attorneys wrote four amicus briefs filed in the Supreme Judicial 
Court and one in the Appeals Court in FY98. One case involved the procedure to be followed 
when a criminal defendant seeks access to confidential police department internal affairs records; 
the court adopted the position the Attorney General took in balancing the competitive interests 
involved. Another presented the court with an opportunity to interpret the state's Anti-Slapp 
statute. Because the Attorney General has a special role when the Anti -Slapp statute is involved, 
an amicus brief was filed in cooperation with the Government Bureau, urging a construction of 
the statute that would prevent harassing lawsuits brought against those who exercise their right to 
petition government. An amicus brief was written in a criminal case that considered when and 
how an appellate court may consider an issue in a criminal case that was not preserved for 
appeal. In another criminal case, an amicus brief was filed on behalf of the Commissioner of 
Probation arguing that a criminal defendant should not be given access to probation files and 
records in order to make a selective prosecution claim and that the probation department should 
not be required to collect and quantify such informafion. An amicus brief was also filed in a case 
which sought to define the circumstance under which a grand jury may order blood and other 
samples be produced from a suspect for DNA or other analysis. 

The Division was successful in all appeals that were decided during FY98, except one in 
the First Circuit, and the courts agreed with the arguments made in the Division's amicus briefs. 

The following shows the briefs filed for the last seven years: 



Court 


FY 
1998 


FY 
1997 


FY 
1996 


FY 

1995 


FY 

1994 


FY 

1993 


FY 
1992 


U.S. Supreme Court 


2 


1 


-> 

5 


3 


2 


4 


7 



60 



U.S. Court of Appeals 
(First Circuit) 


14 


15 


12 


23 


14 


7 


10 


Supreme Judicial Court 


15 


11 


21 


21 


14 


13 


7 


MA Appeals Court 


26 


32 


27 


32 


24 


26 


32 


Totals 

* Includes 2 bankruptcy 

appeals 


57 


59 


63 


79 


54 


52* 


56 



The Appellate Division also prepares and files lengthy substantive memoranda in 
opposition to petitions for habeas corpus relief, in support of motions to dismiss or for summary 
judgment in civil cases or in opposition to motions for new trial in criminal cases, all of which 
are the equivalent of full appellate briefs. During FY98, in addition to appellate briefs. Division 
attomeys filed 21 1 substantive legal memoranda; 124 were filed in federal habeas corpus cases 
and 87 in other civil and criminal cases. 

C. Renditions 

Attomeys from the entire Criminal Bureau, at the request of the Governor's office, render 
opinions to the Governor on the legal sufficiency of applications for Governor's warrants sought 
by other states as well as requests by Massachusetts District Attomeys, the Department of 
Correction and the Parole Board to rendite ftigitives to Massachusetts. From July 1, 1997, 
through June 30, 1998, 160 cases were reviewed. Criminal Bureau attomeys also handle the 
habeas corpus cases brought by an individual challenging the validity of a Governor's warrant in 
the state and federal trial and appellate courts, and coordinate extradition of the fugitive to the 
requesting state. 
II. 

FY 98 CASE HIGHLIGHTS 

A. Federal Habeas Corpus 

One of the Appellate Division's primary missions is representing the Commonwealth's 
interest in federal habeas corpus cases which challenge state criminal convictions and custody. 
These cases represent approximately 40% of the Appellate Division's caseload but require a 
substantially greater percentage of the attomeys' time. Most cases require the filing of lengthy 
and complex memoranda and occasionally there are also evidentiary hearings in federal court in 
these cases. 

During the course of the fiscal year, the Appellate Division carried 281 federal habeas 
cases, a nimiber well above last year. In the last decade, the Attomey General's office has seen a 
400% increase in the number of federal habeas corpus cases filed. For example, in FY87, only 
30 new federal habeas corpus cases were handled by six staff attomeys and a division chief, 
compared to the 152 new cases handled by nine staff attomeys and a division chief in FY98. 

The passage in April, 1996, of the amendments to the federal habeas corpus statute is 
largely responsible for the increased number of cases. For the four years prior to the 
amendments, the Division opened approximately 85 of these cases per year. In FY97, the first 
full fiscal year after the new law went into effect, 1 16 new federal habeas corpus cases were 
filed. The number of filings has continued to rise in FY98, where the 152 new cases that were 



61 



filed reflect more than a 30% increase over FY97, and a 78% increase over the number of cases 
filed prior to the amendments. 

A number of factors have contributed to the increase in habeas litigation. One reason is 
that the federal law created for the first time a statute of limitations. Inmates challenging state 
convictions must now bring their federal habeas corpus petitions within one year of their state 
court conviction becoming final, or lose their right to bring such an action. It now appears that 
filing a federal habeas petition is becoming much more routine after state court appeals have 
concluded. 

In addition, under the old law, the federal court could not entertain a federal habeas 
petition unless each and every claim had been presented to the state courts. Mtoy habeas cases 
could be briefed on a more limited basis, and the inmate's petition then dismissed. Under these 
circumstances. Division attorneys did not need to fully research and brief the merits of the 
prisoner's legal challenges in every case. Congress, however, changed the habeas law to permit 
the federal courts to litigate the merits of petitions which made arguments that had never been 
made in state court. The change in the law now attempts to streamline the federal habeas 
procedure, and cut down lengthy delays and protracted challenges to convictions, particularly in 
capital cases. As a result, the federal courts now request that Division attorneys fully brief the 
merits of each issue in practically every petition. While the federal court cannot grant a writ of 
habeas corpus on a claim that had not been presented to the state courts, the federal courts 
nevertheless are requiring fiill briefing in almost every case, adding substantially to the amount 
of time spent defending habeas petitions. 

A third change under the new law requires a prisoner wishing to file a second or 
subsequent petition to obtain leave to do so fi-om the First Circuit Court of Appeals and show 
that the issues in the subsequent petition are new and could not have been brought at the time of 
the first petition. Because the First Circuit has no way to evaluate these cases under this standard 
without our input, the Court has come to request the Appellate Division to brief the matter in 
many of these cases. 

The Division has been particularly successfiil in defending against habeas corpus 
challenges. In the last seven years, only four cases fi-om over 660 disposed were ultimately 
unsuccessful fi-om the Commonwealth's perspective. Two of these cases occurred during FY98. 
In one case, the Court of Appeals ordered that the writ should issue because it concluded that the 
defendant was not provided with effective assistance of counsel. In another case, a federal 
district court judge concluded that the defendant had not been provided with information 
possibly affecUng the credibility of a key government witness. In this latter case, after consulting 
with the District Attorney's office, it was determined that the most appropriate course would be 
to pursue retrial in state court. Because the case was then resolved favorably to the 
Commonwealth when the defendant plead guilty, the habeas corpus case was not appealed. 

The habeas corpus cases handled by the Division are challenges to a wide variety of state 
court convictions obtained throughout the Commonwealth, including a number of first degree 
murder and other high profile cases. Most of the Division's federal habeas cases continue to 
involve the interpretation and application of the substantial revisions to the statute and in FY98, 
the Division successfully litigated two important cases involving the standard federal courts use 
to review state convictions and the requirements for filing a second habeas petition. In another 
case, the Division was successfiil in convincing the First Circuit to reverse itself and deny habeas 



62 



relief in a murder case in which the court initially concluded the defendant's trial attorney was 
ineffective. 

B. State Habeas Corpus Cases 

During FY98, the Appellate Division handled 56 state habeas corpus actions by prisoners 
seeking immediate release from confinement in such matters as challenges to the validity of 
governor's warrants and extradition, challenges to criminal convictions, claims that parole 
surrenders were unlawful, and attacks on civil commitments to the Treatment Center. 

C. State and Federal Civil Cases 

The Appellate Division handled 52 federal civil matters, which primarily involved civil 
rights actions brought against state prosecutors, public defenders, judges and other criminal 
justice system officials. Despite the variety of defendants and claims. Division attorneys were 
successful in obtaining dismissals prior to any time-consimiing and burdensome discovery. 
Several cases involved representation of prosecutors who were subpoenaed to testify or produce 
their investigative or trial files, or cases where the integrity or validity of state criminal 
prosecutions were at issue. 

The Appellate Division's state civil caseload of 177 cases involved appeals in all cases 
handled at the trial court level by agency counsel at the Parole Board, including an appeal from a 
verdict that would release an individual from the Treatment Center, 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. The Division also actively seeks to 
prevent collateral attacks on criminal convictions in cases where defendants bring civil or tort 
claim actions against prosecutors, courts, and witnesses for their actions relating to prosecutions, 
and has intervened on behalf of the various District Attorney offices to stay civil proceedings 
until related criminal cases are concluded. 

The Appellate Division's work on Parole Board matters has included a number of cases 
which involve the question of counsel at parole revocation hearings and other cases challenging 
Parole Board practices, policies and decisions. Division attorneys have worked with the Board in 
setting up a system to provide counsel at parole revocation hearings in qualifying cases. 

The Appellate Division has continued to take advantage of the authority in the Anti- 
SLAPP statute for the Attorney General to intervene in civil lawsuits that are alleged to have 
been brought to chill or retaliate against individuals for the exercise of their right to petition 
government, and has successfully argued that the statute operates to require dismissal of civil 
cases brought by convicted criminal defendants against victims and witnesses who either 
provided information to police or prosecutors, testified before the grand jury or at trial, or 
otherwise cooperated with police and prosecutors in criminal cases. The Appellate Division also 
has the primary responsibility, in conjunction with the Government Bureau, to defend the 
numerous challenges that have been made to the new statute creating a DNA database. 

D. Criminal Cases 

The majority of criminal cases handled by the Appellate Division are appeals from 
criminal convictions in prosecutions brought by the trial divisions of the Criminal Bureau. The 
number of cases handled this year, 107, continues to reflect the volume of Criminal Bureau trials 
and convictions. The Division also represents the Commonwealth when a defendant petitions 
the United States Supreme Court for a review of state conviction. 



63 



■ During FY98, the Division handled criminal appeals from convictions or from the denial 
of motions for new trial in a variety of cases including narcotics, arson, tax evasion, rape, 
election law violations, and perjury, and was successful in an appeal from the conviction of a 
police chief for rape of a child. The Division also handled several appeals from trial court 
judgments of criminal contempt. Among the Division's criminal cases was a successftil 
argument against a request to expunge a domestic violence conviction that under the Brady Law 
would preclude the defendant from obtaining a firearm license. In addition, a Division attorney 
has been working with Special Prosecutor Thomas Brennan for nearly three years in the 
investigation into the murder of Assistant Attorney General Paul R. McLaughlin. In February, 
1 998, an indictment was returned and the case is pending in Suffolk Superior Court. 

E. G. L. C. 21 1- § 3 and Other Single Justice Matters 

The Appellate Division handled 35 cases in the single justice session of the Supreme 
Judicial Court. These matters frequently involve representation of the courts and judges, in 
defense of some aspect of the criminal justice process or system. 

Among the cases handled in FY 98 was a challenge to the practice in Plymouth County of 
holding arraignments at the jail in order to save the various cities and towns the expense of 
housing and transporting arrestees who were unable to make bail after weekend arrests; a case in 
which a criminal defendant claimed a privilege in refusing to answer questions posed by the 
Probation Department to establish whether he qualified for the appointment of counsel; litigation 
involving the role of a clerk's hearing in resolving disputes and allowing public involvement in 
the criminal process and the question of whether there is a right to appeal to a judge when a clerk 
magistrate denies the issuance of a complaint; and whether a court has the power to impose a 
reduced filing fee on a prisoner seeking to file or take an appeal in a civil case, where the 
prisoner has adequate funds in his prison account to pay the nominal fee. 

III. CRIMINAL JUSTICE INITIATIVES 

Many of the attorneys in the Appellate Division work for the betterment of the legal 
profession and are engaged in public service in a number of ways. 

• Assistant Attorney General Ellyn Lazar was selected to serve a term as a Supreme Court 
fellow at the National Association of Attorneys General (NAAG). During that term, 
AAG Lazar wrote an amicus brief on behalf of 38 states and participated in NAAG's 
moot court program for Supreme Court arguments. 

• Assistant Attorney General William Duensing served on the NAAG committee on inmate 
litigation. 

• Assistant Attorney General William Meade is a member of the Editorial Board of 
Massachusetts Law Review . 

• Assistant Attorney General Gregory Massing served as Public Records coordinator for 
the Criminal Bureau and was a panelist for the Attorney General's Race Forum. 

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



64 



Sanctions. AAG Hunt is also a member of the Supreme Judicial Court's Standing 
Advisory Committee on the Criminal Rules, and is on the NAAG Criminal Law 
Committee. She was appointed a member of the Criminal Justice Section Council of the 
Massachusetts Bar Association and Vice Chairperson of the Appellate Bench Bar 
Committee. 

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

• Division attorneys are active members of the Commonwealth's Appellate Attorneys 
Action Project and work closely with the District Attorneys' offices on matters of state 
wide interest and impact. 

• The Division provides information on behalf of the Attorney General to the Parole Board 
relevant to its consideration of pardon, commutations, and parole decisions for those 
serving parole-eligible life sentences. 

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 with Board counsel in the defense of these matters, and handle all appeals in these cases. 
The Appellate Division is also involved in 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. Department of Correction 

Department of Correction attorneys, under the direction and supervision of the Appellate 
Division and the Government Bureau, handle civil and state habeas corpus litigation filed by 
prisoners in a number of matters including challenges to conditions of confinement, prison 
disciplinary matters, calculation of sentence credits and petitions filed by sexually dangerous 
persons for discharge from the Treatment Center. Appellate Division attorneys defend cases 
which attack the validity of original SDP commitment or the underlying criminal conviction. 

C. District Attorneys 

Whenever a District Attorney has a conflict of interest in an appellate case or in a case 
involving a parole hearing, the Commonwealth's interests are handled either by Assistant 
Attorneys General or by an Assistant District Attorney who is designated a Special Assistant 
Attorney General and is supervised by attorneys in the Appellate Division. 

D. Commissioner of Probation 

During FY98, agency counsel in the Office of the Commissioner of Probafion, under the 
supervision of the Appellate Division, were designated Special Assistant Attorneys General to 
handle matters in which a mofion to expunge probation and court records in criminal cases was 
filed. 

65 



CRIMINAL INVESTIGATIONS DIVISION 

The Criminal Investigations Division continues to provide the Criminal Bureau with an 
experienced corps of investigators to conduct Criminal Bureau investigations. The police and 
civilian investigators assigned to the Division provide a wealth of expertise and experience in 
such areas as organized crime, narcotics trafficking, public corruption, firearms violations, 
money laundering, securities violations, tax fraud, computer crime, crimes against the elderly, 
and environmental crime. 

The Division also provides technical support and resources to other divisions within the 
Office of the Attorney General and to municipalities within the Commonwealth in such areas as 
handwriting analysis and photography/video expertise. The Criminal Investigation Division has 
developed outstanding cooperative working relationships with many law enforcement agencies 
throughout the Commonwealth, as well as throughout the country. 

The State Police unit assigned to the Criminal Bureau is commanded by Captain Jack 
Kelly; Lieutenant Robert Friend serves as the executive officer; Sergeants Walter Carlson and 
Dermot Moriarty are assigned to the Public Integrity and Economic Crimes Division; Sergeant 
Thomas Greeley commands the Narcotics and Special Investigations Division; and Sergeant 
Brian Kennedy is assigned to the Springfield office. Lt. Friend directly supervises the High Tech 
Crimes Unit. Sergeant John McLean fi-om the Medford Police Department and Officer Eric 
Lundberg fi-om the Easton Police Department are assigned to the High Tech Crime Unit and 
provide invaluable years of experience in computer related criminal investigations. Lieutenant 
Gail Larson of the Environmental Police supervises environmental investigations. 

The hallmark of the Division continues to be the cooperative investigations undertaken 
with other law enforcement, governmental and regulatory agencies. Significant among these 
investigations are the following: 

In response to an "epidemic" of overdoses and deaths related to the use of "Designer 
Drugs" which have become fashionable with teenagers and college students at so-called "Rave 
Parties," an extensive undercover investigation was undertaken by the Narcotics and Special 
Investigations Division. The investigation, in conjunction with an investigation by the New 
Hampshire State Police, targeted the dealers of the so-called designer drugs, including 
methamphetamine, known as "Crystal Meth," ketamine hydrochloride, also known as "Special 
K," and methylenedioxy methamphetamine, also known as "Ecstasy." 

The operation dubbed "Operation Rave," culminated in the arrest of over 30 dealers in 
Suffolk, Middlesex and Essex Counties, as well as in New Hampshire. The investigation also 
resulted in the seizure of over $600,000 worth of illegal narcotics and the seizure of $25,000 in 
cash. This investigation was instrumental in focusing the public's attention on those designer 
drugs and the serious health issues they pose to the youth of the Commonwealth. 

In late December of last year, the Criminal Investigation Division culminated a two-year 
investigation of a prominent defense attorney and his driver. The allegations concerned acts of 
bribery and interfering with witnesses in serious criminal matters. The victims of these crimes 
were generally poverty stricken females who had been victims of rape, robbery or other violent 
acts. The women were solicited by the defense attorney or his driver to accept monetary bribes 
in exchange for reftising to testify or changing their stories about individuals who had raped or 



66 



robbed them, and were represented by this particular attorney. These women were initially 
reluctant to report their bribes to authorities for fear that they would be harmed by these men. 
Investigators assigned to the Division were able to transform these "reluctant" victims into 
highly credible witnesses for the Commonwealth resulting in the conviction of both defendants. 
This investigation and resulting conviction helped to assure the citizens of the Commonwealth of 
the integrity of our judicial system. 



During fiscal year 1998, the Criminal Investigation Division accomplished the following: 

Investigations 360 

Arrests 215 

Search Warrants 85 

Assists to Other Agencies 1030 

Drug Money Seized $89,534 

Background Investigations 1 500 



67 



ECONOMIC CRIMES DIVISION 

The Economic Crimes Division investigates and prosecutes all types of private sector, 
white collar and economic crime in state courts across the Commonwealth. The Division is 
charged with stemming the serious and egregious effects of private sector white collar offenders 
within the state through both pro-active prevention and aggressive prosecution. The seriousness 
of the cases prosecuted by the Division demonstrates the crippling impact of economic crime as 
it travels through families, communities, and in some instances, throughout the state, forever 
changing those affected. The victims of these crimes take many shapes, from the vulnerable 
elderly individual, to the small business or large corporation. 

Although the cases handled by the Division may vary in size, from the^$50,000 theft from 
a single elderly victim, to the multi-million dollar theft from a large corporation, the intensity of 
harm is treated with equal importance. Each year, the goal of the Division is not only to indict 
and convict guilty felons from stripping their victims of their life savings, their businesses, or 
ultimately, their personal futures, but also to assist the public and private sector in creating 
systemic change in order to prevent fraud. 

Massachusetts citizens annually incur hundreds of millions of dollars in losses through 
private sector fraud. Just during the past fiscal year, the Economic Crimes Division alleged more 
than $29,848,000.00 million dollars in private funds stolen. Since fiscal year 1995. the 
Economic Crimes Division has obtained 214 convictions and dispositions totaling over $60 
million dollars in private stolen funds from victims throughout the Commonwealth. The 
statistics contained within this report paint a portrait of the battle waged by a group of qualified 
professionals against private sector fraud, committed to making offenders accountable for their 
financial crimes. 

Throughout the past year, the Economic Crimes Division focused on three priority areas: 
(1) lawyer fraud, (2) tax crimes, and (3) 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 Economic Crimes Division consists 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; Kevin Brekka. AAG; Stephanie Kelly, AAG; Sarah Hartry, 
AAG; Lori Balboni, AAG; Stephen Patemiti, AAG; Phillip McGovem, AAG; Mark Mulligan, 
AAG; Andy Zaikis, SAAG; Olivia Blanchette, Secretary; James McFadden, Investigator; Patrick 
Ormond, Investigator; Brad Chase, Investigator; David Baker, Investigator; Sally Ann Nelligan, 
Investigator. Assistance from Paul Stewart, Director of Financial Investigators, and the State 
Police Unit assigned to the Criminal Bureau, has been an invaluable addition to the successful 
work of the Division. 

In fiscal year 1998, the Economic Crimes Division commenced over 51 criminal 
prosecutions against individuals, entities, and corporations that had taken advantage of their 
positions of power in the private sector to the detriment of the working men and women of the 
Commonwealth. During the same time, 5 1 convictions were obtained against white collar 
criminals and corporations, including defendants not charged within this fiscal year. The 



68 



attached charts reflect the statistics for the financial and tax prosecutions indicted for the past 
fiscal year, and all cases completed by the Division throughout the last four fiscal years. 



69 



Economic Crimes Division 

Annual Report 

Indicted Counts by Crime 

FY 98 



Tax Fraud 

39% 



Securities, Unlawful 

Practice & Other 

Offenses 

12% 




Larceny & 
Related Offenses 

40% 



Forgery, Uttering, 

Perjury, False 

Corporate Records & 

related Offenses 

9% 



Total Stolen Funds AUeged by Indictment $29,848,000 



Economic Crimes Division 

1995-1998 
214 Dispositions 



Traditional White 

Collar Crime 

{Guilty} 

59% 



Traditional White 
Collar Crime jAcquiiuis/ 

Dismissals) 
2% 




Tax Cases 
{Guilty} 

38% 



70 



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 
Attorneys' Offices across the state. 

The investigations initiated by the Division tend to be difficult, complex white collar 
cases that involve 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 employed, or the mental state which enabled the 
defendant to perpetrate his crime. 

To answer the challenging goals of the Economic Crimes Division in prosecuting the 
most elaborate of financial schemes, law enforcement techniques have grown more sophisticated 
in response to the changing face of private sector fraud over the passage of time. Computer 
technology and enhanced litigation tools are frequently employed by Division members to 
explain often complicated financial matters to a grand jury or to a trial jury. The significant 
effect of such efforts sends the message that our evolving technological age will be embraced by 
law enforcement officials to prosecute even the most sophisticated felon as we advance to the 
next century. 

Below are highlights of the financial crimes and lawyer fraud cases prosecuted by the 
Economic Crimes Division in fiscal year 1998. 

1. TRADITIONAL WHITE COLLAR CRIME CASE HIGHLIGHTS 

Commonwealth v. Paul S. Dolan . Norfolk & Suffolk Superior Courts. 

This Defendant, a former stock broker and financial adviser, having maintained two 
families and multiple business offices in Boston and Florida, admitted to stealing over $2 
million dollars from 3 1 clients, many of whom were elderly and entrusted the Defendant 
with their life savings. Paul S. Dolan, of Revere, plead guilty to 31 counts of Larceny 
Over $250 and to 31 counts of Securities Fraud. The plea included charges brought 
against him in both Suffolk and Norfolk counties. Dolan's illicit activities centered 
primarily on two fraudulent investment schemes involving the sale of investments in his 
Florida dinner club, and the sale of interests in phony tax-exempt funds ostensibly 
investing in municipal bonds. Judge Charles Barrett sentenced Dolan to 66 months in the 
House of Correction, committed, with a two year sentence, suspended for 5 years, to run 
from and after his committed incarceration. In addition, the judge ordered the defendant 
to pay $650,000 in restitution and serve 250 hours of community service. 



71 



Commonwealth v. Algie Urbonas . Essex Superior Court. 

This defendant, a former H.D. Vest broker and independent tax preparer, was indicted for 
allegedly convincing elderly tax clients to invest their life savings in sham investments 
totaling approximately $300,000. Algie Urbonas was charged with 10 counts of larceny 
over $250, 10 counts of securities fraud, and 10 counts of offering the sale of unregistered 
securities. After admitting his guilt to all charges, Urbonas was sentenced to 2 years in 
the House of Correction, followed by 3 years of probation, and ordered to pay over 
$10,000 in restitution. 

Commonwealth v. John Curtis. Suffolk Superior Court. 

■N 

This Canton resident was indicted on charges that he stole more than $1 million dollars 
from Star Market through an elaborate scheme involving fake purchase orders, bogus 
billings and other alleged deceptions. John Curtis, 54, was the head of the maintenance 
department for Star Market until November, 1995 and responsible for the maintenance 
and purchase of equipment for all of Star Market's 39 stores. He was indicted on 25 
counts of larceny over $250 and filing false entries in corporate books for his alleged 
involvement in creating false purchase orders and payment vouchers. He was also 
indicted on multiple counts of conspiracy to commit larceny and false entries in corporate 
books. 

Commonwealth v. Man Kin "Daily^ Chan, Danny Do Vale, & Ed Lau . Suffolk 
Superior Court. 

Two middle managers of a bogus international investment scheme that stole over 1.5 
million dollars from mostly immigrant victims in Chinatown, Danny Do Vale & Ed 
Lau, were tried by a jury in Suffolk Superior Court. Prior to the trial starting, the third 
defendant charged in the scheme, Man Kin "Daily" Chan, plead guilty and was 
sentenced to 4 years to 4 years and a day in state prison, with $93,548 in restitution. A 
three week superior court jury trial then ensued on the remaining two defendants, and 
after the trial, guilty verdicts were obtained as to all charges against Danny DoVale, and 
not guilty verdicts as to all charges against Ed Lau. DoVale was sentenced to two-and-a- 
half to three years in state prison by Judge Patrick King for his conviction of larceny, 
securities fraud, filing false corporate assets and running a bucket shop. 

Chan had the primary role in an elaborate scheme that duped 140 investors into believing 
that they were buying and selling foreign currency on the margin through accounts at the 
Bank of England. DoVale was a manager of the Boston branch of London & Global, 
and Ed Lau, an MIT nuclear physicist, participated as the teacher for the victims to learn 
how to trade so-called foreign securities in exchange for their money. The Attorney 
General's Criminal Bureau incarcerated two out of three main players in the Boston shop, 
in addition to obtaining restitution orders of 1.5 million and shutting down a major 
international financial scam in the Commonwealth. 

Commonwealth v. Patrick Forte, Suffolk Superior Court. 

The former Vice President of Operations for the New England Patriots, Patrick Forte, 

was sentenced in Suffolk Superior Court to 59 days in the House of Correction, balance 



72 



suspended for 2 years probation, with restitution of $19,400. After his termination from 
the Patriots, Forte admitted that he had an ongoing relationship with the organization and 
induced fans to give him money for purchase of season and super bowl tickets. Forte 
failed to produce the tickets or return the money to the victims. In addition, he failed to 
file state income tax returns during the years that he was earning a six figure salary fi-om 
the Patriots. 

Commonwealth v. Kevin Snow. Shawn Snow, Donald Perkins. Frances Perkins & 
Steven Wheeler . Essex Superior Court. 

Five Seabrook, N.H., men plead guilty to charges that they participated in a series of 
schemes to defraud an 80 year old Amesbury man of more than $65,000, his entire life 
savings. Kevin & Shawn Snow, Frances & Donald Perkins, and Steven Wheeler each 
plead guilty at separate hearings to one count of Larceny Over $250 and sentenced to two 
years in the House of Correction, six months to be served, the balance suspended for 3 
years of probation with fijU restitution. 

Commonwealth v. Jeffrey Maniff . Norfolk Superior Court. 

This matter involves an Easton man charged with allegedly stealing more than $325,000 
from an elderly woman who lives in a nursing home. Jeffrey Maniff was indicted on 13 
counts of larceny over $250, and five counts of securities fi-aud. The indictments allege 
that Maniff, an accountant and businessman who ran a luxury auto leasing operation, 
stole the money after befiiending two elderly women, ages 97 and 90, offering to perform 
tax work and banking transactions for them. As of August 1998, the defendant is 
currently being tried in Norfolk Superior Court. If convicted, Maniff faces a five-year 
state prison sentence for each larceny count, and a three year state prison sentence for 
each securities fraud count. 

2. LAWYER FRAUD CASE HIGHLIGHTS 

Commonwealth v. Charles Victor. 11 . Suffolk Superior Court. 

A Lynn attorney was charged with embezzling $450,000 from trust funds established for 
seven children suffering from lead poisoning. Charles A. Victor, II, who maintained a 
law office in Lynn, MA, was arrested at a fiiend's home in Arlington after evading 
authorities and the Board of Bar Overseers. Victor served as a trustee for seven 
children's trusts which were established to provide for the educational and medical 
development of seven Massachusetts children who suffered injuries as a result of lead 
paint poisoning. The indictments charge Victor with depleting the trusts of virtually all 
their money for his own personal benefit and use. He is currently being held on $100,000 
cash bail pending the criminal litigation. 

Commonwealth v. Thomas Carg ill. Suffolk Superior Court. 

This matter involves a prominent Boston personal injury attorney who allegedly stole 
more than $1 million dollars of clients' settlement ftmds. Thomas Cargill, whose 
personal injury practice was once the most successful in the city, is alleged to have 
plundered the accounts of multiple clients, including elderly persons and the families of 



73 



disabled persons. Cargill gave up his law practice in February of 1996 and the case was 
referred to the Attorney General's Office by the state Board of Bar Overseers. 

Commonwealth v. Walter Palmer , Suffolk Superior Court. 

The Defendant, a disbarred attorney, is alleged to have stolen approximately $1 million 
dollars from his former clients through his abuse of his position as trustee, guardian and 
executor to at least six former clients. Walter Palmer, of Hingham, is currently charged 
with taking approximately $740,000 left in trusts and converting it for his own personal 
use. 

Commonwealth v. Buford Kaig ler. Suffolk Superior Court. '^ 

This case involves a disbarred attorney who allegedly held himself out as a practicing 
lawyer in order to take victims' money, causing several victims to lose their homes. 
Buford Kaigler, of Mattapan, allegedly continued to practice law illegally, claiming to 
act in his victims' best interest, while he was actually stealing their money. 

Commonwealth v. Jeffrey Boxer , Norfolk Superior Court. 

This matter involves a temporarily suspended attorney who is alleged to have solicited 
clients suffering from investment losses, and then stealing the settlements he obtained for 
them. Jeffrey Boxer, of Wellesley Hills, is charged with stealing approximately 
$155,000 from 4 separate clients, several of whom are elderly and one of whom is 
disabled. 

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, concentrates full time on this subject area. In 
fiscal year 1998, 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 FY98, particularly in the areas of analysis of 
documentation relating to potential tax violations. Additional cases were developed by the Tax 
Prosecution Unit as a result of referrals from other agencies. 

1. THE ECONOMIC CRIMES ANNUAL TAX SWEEP INITIATIVE 

As part of the Economic Crimes Division's annual April Tax Sweep Initiative with the 
Department of Revenue's Criminal Investigation's Bureau, the Division's Tax Prosecution Unit 
indicted 18 defendants and corporations for more than $19 million in unreported income. The 
targets of the sweep were spread across the Commonwealth, stretching from Nantucket to 
Berkshire County. Collectively, the criminal indictments, which ranged from tax evasion to non- 
filing of tax returns, represented approximately $19 million dollars in unreported income and 
taxable receipts on which almost $750,000 in taxes are owed to the state. Included in the 
indictments were charges against a Dalton man who owns a video arcade in Pittsfield and 
allegedly failed to report about $7 million in taxable receipts. The defendant also allegedly 



74 



leases video and other vending machines to area bars. In addition to this investigation, there 
were many other large tax cases included in the sweep involving both individuals and 
corporations, representing one of our largest sweeps in the past three years. 

Once again, the Division is proud to report that this Tax Sweep year improved upon last 
year's efforts in the number of targets, the total amount of tax liability, and the seriousness of tax 
cases charged. 

During the entire fiscal year of 1998, 26 new cases were charged in the Superior Courts 
throughout the Commonwealth, with 26 pending cases being successfully prosecuted to 
completion. A couple of the tax cases prosecuted by the Division are highlighted below. 

2. TAX FRAUD CASE HIGHLIGHTS 

Commonwealth v. John P. Conroy . Suffolk Superior Court 

John P. Conroy, 61, who lives in a $1.4 million Atlantic Avenue mansion and has two 
offices in Boston, was indicted in late October, 1997, by a Suffolk County Grand Jury on 
larceny and tax charges. Conroy, an accountant and also a lawyer, is charged with 
stealing $888,000 from two Boston charities, the American Cancer Society and Boston 
Children's Hospital and using the money for his own personal gain on the stock market. 
In addition to using the money for the stock market, Conroy funneled most of the 
$888,000 from the estate by charging $635,000 for his services - - 45 percent of the 
estate's value. The normal charge is closer to 5 percent. 

United States v. Lars Bildman «& Lars Magnusson . Federal 

District Court of MA. 

(Joint State & Federal Tax Prosecution) 

The former President and CEO of Astra, U.S.A., Inc., an international pharmaceutical 
company, plead guilty to filing false tax returns which failed to report over $1,000,000 
dollars in income he received from Astra. In a joint state and federal prosecution, 
defendant Lars Bildman was sentenced on January 26, 1998, to federal prison for 21 
months and ordered to pay a $30,000 fine. Another former Astra executive, Lars 
Magnusson, also plead guilty to imprision of a felony relating to the destruction of 
documents. 

Commonwealth v. J «& M Taylor Co.. Inc. . Suffolk Superior Court 

This case involved a company that runs three motels in Falmouth, MA. J & M Taylor 
Co., Inc. plead guilty to three counts of willful failure to file timely room occupancy tax 
returns. The corporation was ordered to pay fines, surfines, and costs totaling $50,000. 
From 1991 through 1993, J & M Taylor operated the Falmouth Marina Tradewinds and 
the Park Beach Motel, and in 1992 and 1993 operated the Surfside Holiday Motel as well. 
As is required by law, the company collected state and local room occupancy tax from 
customers renting motel rooms, and although the amount of taxes collected during this 
period amounted to over $250,000.00, the corporation's accountant neither filed returns 
nor paid room taxes for 1993, and filed false returns for 1991-92. 



75 



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

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

A. Speaking Engagements. Appointments «& Trainings . 

* Appointed Committee Member by Chief Justice Wilkins for the Supreme 
Judicial Court Committee On Lawyer Advertising , from 6-25-97 to the 
present. The Committee anticipates finalizing a report for the Supreme Judicial 
Court in the fall of 1998. 

(AAG Starkey) 

*Compiled and wrote White Collar Crime Report for the Office of the Attorney 

General. 

(AAG Starkey) 

* Speaker for the Russian Delegate Presentation held at the Office of the 
Attorney General. 

(AAG Starkey) 

* Subcommittee member for Attorney General's Task Force on Racial & 
Ethnic Bias in the Courts . 

(AAG Hartry) 

♦Attended Conference on Complex Litigation held in Williamsburg, VA. 
(AAG Starkey) 

*Guest Speaker at Government Lawyer Clinic, New England School of Law . 
held at the Office of the Attorney General. 
(AAG Brekka) 

* Mentor law students from New England School of Law & Thomas Cooley 
School of Law . 

(AAG Brekka) 

* Guest Speaker at Braintree High School , on constitutional issues which arise 
during criminal prosecutions. 

(AAG Mulligan) 

* Guest Speaker for Government and Lawyers class. New England School of 
Law , on strategic and ethical issues involved in criminal prosecutions. 
(AAG Brekka) 

* Attended Law Enforcement Coordinating Committee Conference . 

(AAGs Mulligan, McGovem, Hartry, Starkey) 

B. Attorney General Report On White Collar Crime . 



76 



Assistant Attorney General Carol Starkey, chief of the Economic Crimes Division, 
authored a report on white collar crime, asking the Legislature to pass laws that increase the 
penalties for white collar crime and public corruption. The report is crammed with statistics 
breaking down incidences of white collar crime in the Attorney General's Criminal Bureau, 
Public Protection Bureau, and Business and Labor Protection Bureau. It showed that there were 
102 defendants or corporations convicted of white collar crimes from 1995 to 1997. Of that 
figure, however, only 36 defendants received any portion of jail time. Sixty-six received an 
alternative sentence, a suspended sentence, probation or fines. 

The cases of elderly victims or witnesses during that time within the Economic Crimes 
Division alone involved more than $3.7 million in stolen funds. 

Among the recommended solutions are increasing the penalties for crimes such as bank 
fraud and tax evasion. The Attorney General's office also suggested enacting a Racketeering 
Influenced and Corrupt Organization statute modeled after the federal one. 

IV. Number of Defendants Charged or Indicted Broken Down By The Type of Crime 
Committed: 

A. Total Defendants Charged 51 

B. Number of Indictments Returned 394 

1) Larceny & Related Offenses (e.g. Larceny By Stealing; 
Larceny by False Pretenses; Embezzlement; Worthless Check & 

Credit Card Offenses; Receiving Stolen Property) 142 

2) Attempt & Conspiracy to Commit Felony Offenses 16 

3) Insurance Fraud 1 

4) Forgery, Uttering, Perjury, False Corporate Records i& 

Related Offenses 34 

5) Tax Crimes (e.g. Non-filing, False Filing, and Tax Evasion Offenses) 154 

6) Securities Fraud 37 

7) Unlawful Practice of Law & Misc. Offenses 10 

C. Total Disposition and Convictions 51 



77 



IV. CASES CHARGED BY THE ECONOMIC CRIMES DIVISION 

A. Fifty-One (51) Defendants Charged With New Indictments and Complaints .' 
Indictment Date Case Description 



7/23/97 



8/21/97 



9/23/97 



Commonwealth v. Josephine Lontok 
(Larceny Prosecution) 

DEFENDANT DESCRIPTION: 

The Defendant is the former supervisor of Filene's Basement's 
Transportation Department. Between 1991 and 1996, she allegedly stole 
in excess of $230,000 through a false billing scheme. 

COUNTIES CHARGED: Norfolk 

CHARGES: 

6 Counts Larceny Over $250 
1 Count False Filing in Corporate Books 
1 Count Attempt to Commit a Crime 
(AAG K. Brekka) 

Commonwealth v. Ronald Schab 
(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

This DOR referral involves failure to file non-resident income tax returns 
for 1991 - 1995. The defendant is charged with failure to report 
approximately $4 1 0,000 of income and owing approximately $24,000 in 
tax liability. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

5 Counts- Failure to File Non-Resident Tax Returns 
(AAG S. Hartry) 

Commonwealth v. Robert S. Zawadzki 
(Larceny Prosecution) 

DEFENDANT DESCRIPTION: 

The defendant allegedly committed acts of larceny, forgery, uttering and 
insurance fraud through filing the same false information that was the 



'Each defendant indicted in fiscal year 1998 has only been counted once, for a total of 51 
defendants charged, even if the same defendant has been charged in multiple counties or at 
different times throughout the fiscal year. 



78 



basis of his August, 1996 indictments to a third insurance company. 
Colonial Life. He is charged with receiving over $3,600 based on this 
false claim. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count - Larceny Over $250 

1 Count - Fraudulent Insurance Claim 

1 Count - Forgery 

1 Count - Uttering 

(AAG K. Brekka) 



9/23/97 



Commonwealth v. Thomas Lau 
(Financial Crimes Prosecution) 

DEFENDANT DESCRIPTION: 

The defendant and Joseph Yu were joint venturers with the London & 
Global defendants described elsewhere in this report in creating fixed 
prices for the investors/victims. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count - Larceny Over $250 
1 Count - Bucketing 

1 Count - Conspiracy to Commit Larceny 
1 Count - Conspiracy to Commit Bucketing 
(AAG K. Brekka) 

Commonwealth v. Joseph Yu 
(Financial Crimes Prosecution) 

DEFENDANT DESCRIPTION: 

The defendant and Thomas Lau were joint venturers with the London & 
Global defendants described elsewhere in this report in creating fixed 
prices for the investors/victims. 

COUNTIES CHARGED: Suffolk 



9/24/97 



CHARGES: 

1 Count - Larceny Over $250 
1 Count - Bucketing 

1 Count - Conspiracy to Commit Larceny 
1 Count - Conspiracy to Commit Bucketing 
(AAG K. Brekka) 

Commonwealth v. Kevin Snow 
(Larceny Prosecution) 



79 



DEFENDANT DESCRIPTION: 

This matter involves one of five co-defendants charged with committing a 
series of schemes to defi-aud an 80 year old Amesbury man from his entire 
life savings, totaling over $65,000. 

COUNTIES CHARGED: Essex 

CHARGES: 

1 Count Larceny Over $250 
(AAG C. Starkey) 



9/24/97 



Commonwealth v. Shawn Snow 
(Larceny Prosecution) 



DEFENDANT DESCRIPTION: 

One of five co-defendants charged with committing a series of schemes to 
defraud an 80 year old Amesbury man from his entire life savings, totaling 
over $65,000. 

COUNTIES CHARGED: Essex 

CHARGES: 

1 Count Larceny Over $250 
(AAG C. Starkey) 



9/24/97 



Commonwealth v. Donald Perkins 
(Larceny Prosecution) 



DEFENDANT DESCRIPTION: 

One of five co-defendants charged with committing a series of schemes to 
defraud an 80 year old Amesbury man from his entire life savings, totaling 
over $65,000. 

COUNTIES CHARGED: Essex 

CHARGES: 

1 Coimt Larceny Over $250 
(AAG C. Starkey) 



9/24/97 



Commonwealth v. Francis Perkins 
(Larceny Prosecution) 



DEFENDANT DESCRIPTION: 

One of five co-defendants charged with committing a series of schemes to 
defraud an 80 year old Amesbury man from his entire life savings, totaling 
over $65,000. 

COUNTIES CHARGED: Essex 



80 



9/29/97 



CHARGES: 

1 Count Larceny Over $250 
(AAG C. Starkey) 

Commonwealth v. Steven Wheeler 
(Larceny/Unauthorized Practice of Law Prosecution) 

DEFENDANT DESCRIPTION: 

One of five co-defendants charged with committing a series of schemes to 
defraud an 80 year old Amesbury man from his entire life savings, totaling 
over $65,000. 

COUNTIES CHARGED: Essex 

CHARGES: 

1 Count Larceny Over $250 
1 Count Unauthorized Practice of Law 
(AAG C. Starkey) 

Commonwealth v. Richard Stilphen 
(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

Tlie defendants are a restaurant corporation named Richard's Black 
Orchid, Inc. and its president, Richard Stilphen. They are alleged to have 
skimmed hundreds of thousands of dollars off their books while failing to 
pay meals taxes on these amounts. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

12 Counts Filing False Meals Tax Returns 
3 Counts Filing False Excise Tax Returns 
1 Count Failing to Account For and Pay over Meals Taxes 
(SAAG A. Zaikis) 

Commonwealth v. Richards Black Orchid. Inc. 
(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

The defendants are a restaurant corporation named Richard's Black 
Orchid, Inc. and its president, Richard Stilphen. They are alleged to have 
skimmed hundreds of thousands of dollars off their books while failing to 
pay meals taxes on these amounts. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

12 Counts Filing False Meals Tax Returns 



81 



10/15/97 



10/16/97 



10/24/97 



3 Counts Filing False Excise Tax Returns 
1 Count Failing to Account For and Pay over Meals Taxes 
(SAAG A. Zaikis) 

Commonwealth v. Paul S. Dolan 
(Larceny/Securities Fraud Prosecution) 

DEFENDANT DESCRIPTION: 

The Defendant, a former stock broker and financial adviser, who lived a 
high life style traveling between Boston and Florida, allegedly stole $2 
million dollars from 31 clients, many of whom were elderly and entrusted 
the defendant with their life savings. 

COUNTIES CHARGED: Norfolk 

CHARGES: 

3 Counts Larceny Over $250 
3 Counts Sales and Purchases 
(AAG C. Starkey) 

Commonwealth v. Paul S. Dolan 
(Larceny/Securities Fraud Prosecution) 

DEFENDANT DESCRIPTION: 

The defendant, a former stock broker and financial adviser, who lived a 
high life style traveling between Boston and Florida, allegedly stole $2 
million dollars from 3 1 clients, many of whom were elderly and entrusted 
the defendant with their life savings. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

28 Counts Larceny Over $250 
28 Counts Sales and Purchases 
(AAG C. Starkey) 

Commonwealth v. John Conroy 
(Larceny/Tax Prosecution) 

DEFENDANT DESCRIPTION: 

The defendant, an accountant and lawyer, is alleged to have stolen 
substantial monies totaling over $888,000 from multiple charities through 
estate fraud, as well as committing tax evasion through the fabrication of 
hundreds of thousands of dollars in false deductions. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

3 Counts Willful Filing of False Tax Returns 



82 



1 Count Embezzlement by a Trustee 
(SAAG A. Zaikis) 

10/30/97 Commonwealth v. Patrick Forte 

(Larceny Prosecution) 



DEFENDANT DESCRIPTION: 

This defendant was the former Vice President of Operations for the New 
England Patriots. After termination from the Patriots, he allegedly 
represented that he had an ongoing relationship with the organization and 
induced fans to give him money for purchase of season and super bowl 
tickets. Forte failed to produce the tickets or return the money. In 
addition, he failed to file state income tax returns during the years he was 
earning a six figure salary from the Patriots. 

COUNTIES CHARGED: Norfolk 

CHARGES: 

1 Count Larceny Over $250 
(AAG L. Balboni) 

Commonwealth v. Patrick Forte 
(Larceny/Tax Prosecution) 

DEFENDANT DESCRIPTION: 

This defendant was the former Vice President of Operations for the New 
England Patriots. After termination from the Patriots, he allegedly 
represented that he had an ongoing relationship with the organization and 
induced fans to give him money for purchase of season and super bowl 
tickets. Forte failed to produce the tickets or return the money. In 
addition, he failed to file state income tax returns during the years he was 
earning a six figure salary from the Patriots. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

3 Counts Larceny Over $250 

4 Counts Willful Failure to File State Tax Returns 

(AAG L. Balboni) 



1 1 /1 2/97 Commonwealth v. John G. Curtis 

(Larceny/Conspiracy Prosecution) 



DEFENDANT DESCRIPTION: 

Defendant Curtis was the head of Star Market's Maintenance Department, 
and while he was in charge of all re-supply and purchasing orders for 39 
stores, he allegedly misappropriated fionds that were made payable to Star 
Market totaling over 1.5 million dollars. 



83 



COUNTIES CHARGED: Suffolk 

CHARGES: 

24 Counts Larceny Over $250 

1 Count Larceny Over $250 

24 Counts False Entry in Corporate Books 

1 Count False Entry in Corporate Books 

2 Counts Conspiracy to Commit Larceny Over $250 

2 Counts Conspiracy to Make False Entry in Corporate Books 
(AAG K. Brekka) 



11/17/97 Commonwealth v. William Melanson 

(Larceny/Conspiracy Prosecution) 



DEFENDANT DESCRIPTION: 

This defendant allegedly conspired with Curtis to defraud Star Market. 
The defendant was the owner-operator of Melanson and Sons, and in that 
capacity, submitted false records alleging that his company had provided 
refrigeration equipment to Star Market stores. In actuality, the 
Commonwealth alleges that no equipment was delivered, but rather the 
bulk of the monies received from Star were kicked-back to Curtis. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Larceny Over $250 
1 Count Conspiracy to Commit Larceny Over $250 
1 Count Conspiracy to Make False Entry in Corporate Books 
(AAG K. Brekka) 



11/17/97 Commonwealth v. Carole Melanson 

(Larceny/Conspiracy Prosecution) 



DEFENDANT DESCRIPTION: 

This defendant also allegedly conspired with Curtis to defraud Star 
Market. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Larceny Over $250 
1 Count Conspiracy to Commit Larceny Over $250 
1 Coimt Conspiracy to Make False Entry in Corporate Books 
(AAG K. Brekka) 



11/17/97 Commonwealth v. Linda Christmas 

(Larceny/Conspiracy Prosecution) 

DEFENDANT DESCRIPTION: 



84 



This defendant also allegedly conspired with Curtis to defraud Star 
Market. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Larceny Over $250 

1 Count Conspiracy to Commit Larceny Over $250 
1 Count Conspiracy to Make False Entry in Corporate Books 
(AAG K. Brekka) 

Commonwealth v. Harry See 
(Larceny/Conspiracy Prosecution) 

DEFENDANT DESCRIPTION: 

This defendant also allegedly conspired with Curtis to defraud Star 
Market. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Conspiracy to Commit Larceny Over $250 
(AAG K. Brekka) 

Commonwealth v. Walter Palmer 
(Embezzlement Prosecution) 

DEFENDANT DESCRIPTION: 

This defendant is a disbarred attorney who allegedly embezzled over 
$140,000 from an estate for which he was the guardian and executor. 
This defendant was also charged in other counties. 

COUNTIES CHARGED: Norfolk 

CHARGES: 

1 Count Embezzlement 
(AAG K. Brekka) 

Commonwealth v. Walter Palmer 
(Embezzlement/Perjury Prosecution) 

DEFENDANT DESCRIPTION: 

This defendant, a disbarred attorney, is alleged to have embezzled at least 
two million dollars from his former clients through his abuse as trustee, 
guardian and executor to at least six former clients. Perjury charges were 
also alleged against the defendant. 

COUNTIES CHARGED: Suffolk 



85 



12/02/97 



CHARGES: 

1 Count Embezzlement 
1 Count Perjury 

(AAG K. Brekka) 

Commonwealth v. Thomas E. Cargill. Jr. 
(Larceny Prosecution) 

DEFENDANT DESCRIPTION: 

Prominent personal injury attorney who embezzled more than $1 million 
of clients' settlement funds. Victims include elderly persons and the 
families of disabled persons. 

COUNTIES CHARGED: Suffolk 



12/22/97 



1/13/98 



CHARGES: 

15 Counts Larceny Over $250 
(AAG M. Parks) 

Commonwealth v. Stewart Swinamer 
(Tax Prosecurion) 

DEFENDANT DESCRIPTION: 

This defendant was the owner and operator of Stewart's Auto Body, Inc. 
located in Belmont. Swinamer is charged with collecting sales tax on 
parts used in the repair of vehicles from customers, but not tximing those 
monies over to the Department of Revenue ("DOR"). 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Willful Failure to Account For and Pay Sales Taxes 
1 Count Willful Failure to Account For and Pay Withholding Taxes 
(AAG L. Balboni) 

Commonwealth v. Walter E. Palmer 
(Larceny Prosecution) 

DEFENDANT DESCRIPTION: 

Defendant is a disbarred attorney who allegedly embezzled over $140,000 
from an estate for which he was the guardian and executor. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Larceny Over $250 

(AAGs P. McGovem, K. Brekka) 



86 



Commonwealth v. Buford Kaigler. Jr. 

(Larceny /Unauthorized Practice of Law Prosecution) 

DEFENDANT DESCRIPTION: 

This is a Board of Bar Overseers referral involving a previously disbarred 
attorney who allegedly held himself out as a practicing attorney in order to 
take victims' money, causing several victims to lose their homes. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

9 Counts Larceny Over $250 
9 Counts Unauthorized Practice of Law 
(AAG S. Hartry) 

Commonwealth v. Jeffrey B. Boxer 
(Larceny/Embezzlement Prosecution) 

DEFENDANT DESCRIPTION: 

This temporarily suspended attorney allegedly solicited clients suffering 
from investment losses, and then embezzled the settlements he obtained 
for them for a total of over $155,000. 

COUNTIES CHARGED: Norfolk 

CHARGES: 

8 Counts Larceny Over $250 
2 Coiuits Embezzlement by Fiduciary 
(AAG M. Parks) 

Commonwealth v. Jeffrey H. Gruber 
(Larceny Over/Securities Fraud Prosecution) 

DEFENDANT DESCRIPTION: 

This self-proclaimed "financial advisor" allegedly committed crimes 
against four of his clients, two of whom are elderly. The charges concern 
Gruber' s creation of bogus certificates of deposit and fraudulent real estate 
investments. 

COUNTIES CHARGED: Norfolk 

CHARGES: 

6 Counts Larceny Over $250 

4 Counts Uttering 

1 Count Forgery 

1 Count Unregistered Broker-Dealer 

1 Count Unregistered Investment Advisor 

4 Counts Securities Fraud 

(AAG M. Mulligan) 



87 



3/9/98 Commonwealth v. James E. Lackey 

(Tax Prosecution) 



DEFENDANT DESCRIPTION: 

This defendant and his company. Natural Sound, Inc., a Framingham 
corporation engaged in the retail sale of stereo equipment, were charged 
with failure to file significant state income taxes even though the 
Commonwealth alleged that James E. Lackey, the sole office and 
shareholder, made approximately $1,000,000 in gross annual sales. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Willful Failure to File Sales Tax Returns 
1 Count Willful Failure to Account For and Pay Over Sales Tax 
1 Count Willful Failure to File Withholding Tax Returns 
(AAG P. McGovem) 



3/9/98 Commonwealth v. Natiu-al Sound. Inc. 

(Tax Prosecution) 



DEFENDANT DESCRIPTION: 

This defendant and his company. Natural Sound, Inc., a Framingham 
corporation engaged in the retail sale of stereo equipment, were charged 
with failure to file significant state income taxes, even though the 
Commonwealth alleged that James E. Lackey, the sole office and 
shareholder, made approximately $1,000,000 in gross annual sales. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Willful Failure to File Sales Tax Returns 
1 Coimt Willfijl Failure to Account For and Pay Over Sales Tax 
1 Count Willful Failure to File Withholding Tax Returns 
(AAG P. McGovem) 



4/6/98 Commonwealth v. Robert G. Flater 

(Tax Prosecution) 



DEFENDANT DESCRIPTION: 

This is a failure to file prosecution against an individual who allegedly 
worked in Massachusetts for a number of years while failing to file any tax 
returns. 

COUNTIES CHARGED: Norfolk 

CHARGES: 

12 Counts Willful Failure to Account For and Pay Over Withholding 
Taxes 



88 



4 Counts Willful Failure to File State Income Tax Returns 
4 Counts Willful Failure to File State Excise Tax Returns 
(SAAG A. Zaikis) 

Commonwealth v. Dan Beliveau 
(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

This matter involves charges against a defendant charged with both filing 
false tax returns and failing to Massachusetts income taxes for a number of 
years. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Willflxl Filing of a False Income Tax Return 

4 Counts Willful Failure to File State Income Tax Returns 
(SAAG A. Zaikis) 

Commonwealth v. S.J. Patten. Inc. 
(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

The defendants, Mario and Susan Teixeira, are a married couple who ran a 
jewelry store on Nantucket Island. They are alleged to have failed to file 
income tax returns for several years, in addition to grossly underreporting 
their taxable sales on their business tax returns. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

2 Counts Willful Failure to File State Excise Tax Returns 

(SAAG A. Zaikis) 

Commonwealth v. Susan Teixeira 
(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

The defendants, Mario and Susan Teixeira, are a married couple who ran a 
jewelry store on Nantucket Island. They are alleged to have failed to file 
income tax returns for several years, in addition to grossly underreporting 
their taxable sales on their business tax returns. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

5 Counts Willful Failure to File State Income Tax Returns 
2 Counts Willful Failure to File State Excise Tax Returns 
(SAAG A. Zaikis) 



89 



4/6/98 Commonwealth v. Mario Teixeira 

(Tax Prosecution) 



DEFENDANT DESCRIPTION: 

The defendants, Mario and Susan Teixeira, are a married couple who ran a 
jewelry store on Nantucket Island. They are alleged to have failed to file 
income tax returns for several years, in addition to grossly underreporting 
their taxable sales on their business tax returns. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

5 Counts Willful Failure to File State Income Tax Returns 
2 Coimts Willflil Failure to File State Excise Tax Returns 
(SAAG A. Zaikis) 



4/9/98 Commonwealth v. Gary R. Burris 

(Tax Prosecution) 



DEFENDANT DESCRIPTION: 

Gary Burris operated a video game machine company that allegedly 
distributed illegal video poke machines to bars and restaurants throughout 
Western Massachusetts. The operation brought in considerable amounts 
of cash receipts that were not reported by either Burris or the bars and 
restaurants. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

4 Counts Willful Filing of False Income Tax Returns 
(SAAG A. Zaikis) 



4/9/98 Commonwealth v. Michael Bloom 

(Tax Prosecution) 



DEFENDANT DESCRIPTION: 

This case is a spin-off of the Burris investigation of an alleged illegal 
video poker machines. The defendants were ovraers of bars or restaurants 
who brought in substantial gaming revenues from these illegal video poker 
machines, but who subsequently failed to report any of the income on 
related tax returns. 

COUNTIES CHARGED: Suffolk 



CHARGES: 

1 Count Willful Failure to Pay State Taxes 
(SAAG A. Zaikis) 

4/9/98 Commonwealth v. Paul Brindle. Ill 



90 



(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

This case is a spin-off of the Bums investigation of an alleged illegal 
video poker machines. The defendants were owners of bars or restaurants 
who brought in substantial gaming revenues from these illegal video poker 
machines, but who subsequently failed to report any of the income on 
related tax returns. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Willful Failure to Pay State Taxes 
(SAAG A. Zaikis) 

Commonwealth v. Wavne Prue 
(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

This case is a spin-off of the Burris investigation of an alleged illegal 
video poker machines. The defendants were owners of bars or restaurants 
who brought in substantial gaming revenues from these illegal video poker 
machines, but who subsequently failed to report any of the income on 
related tax returns. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Willftil Failure to Pay State Taxes 
(SAAG A. Zaikis) 

Commonwealth v. Barbara Shea 
(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

This case is a spin-off of the Burris investigation of an alleged illegal 
video poker machines. The defendants were owners of bars or restaurants 
who brought in substantial gaming revenues from these illegal video poker 
machines, but who subsequently failed to report any of the income on 
related tax returns. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

1 Count Willftil Failure to Pay State Taxes 
(SAAG A. Zaikis) 



4/9/98 



Commonwealth v. Glenn Grossiung 
(Tax Prosecution) 



91 



DEFENDANT DESCRIPTION: 

This case is a spin-off of the Burris investigation of an alleged illegal 
video poker machines. The defendants were owners of bars or restaurants 
who brought in substantial gaming revenues from these illegal video poker 
machines, but who subsequently failed to report any of the income on 
related tax returns. 

COUNTIES CHARGED: Suffolk 



CHARGES: 

1 Count Willful Failure to Pay State Taxes 
(SAAG A. Zaikis) 

4/9/98 Commonwealth v. Joseph Teti 

(Tax Prosecution) 



DEFENDANT DESCRIPTION: 

This case is a spin-off of the Burris investigation of an alleged illegal 
video poker machines. The defendants were owners of bars or restaurants 
who brought in substantial gaming revenues from these illegal video poker 
machines, but who subsequently failed to report any of the income on 
related tax returns. 

COUNTIES CHARGED: Suffolk 



CHARGES: 

1 Count Willful Failure to Pay State Taxes 
(SAAG A. Zaikis) 

4/9/98 Commonwealth v. Alvin Goldstein 

(Tax Prosecution) 



DEFENDANT DESCRIPTION: 

Goldstein is president and treasurer of Barb-Al, inc., a corporation which 
owns and operates a retail card and gift shop in Randolph under the name 
Barbara's Hallmark. The retail store has been in existence more than 10 
years and, since its inception, failed to file sales or withholding taxes. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

5 Counts Willful Failure to Account For and Pay Over Sales Taxes 
5 Counts Willftil Failure to Account For and Pay Withholding Taxes 
4 Counts Willful Making and Subscribing False Tax Returns 
1 Count Willftil Making and Subscribing False Withholding Tax Returns 
(AAG L. Balboni) 



4/9/98 Commonwealth v. Charles W. Weekes 

(Tax Prosecution) 



92 



DEFENDANT DESCRIPTION: 

This former state Resident, who allegedly used many false New 
Hampshire addresses to avoid state withholding and taxation, is the Vice 
President of U.S. and European Sales for Zilog, Inc., a national and 
international semi-conductor company headquartered in California with a 
regional office in Chelmsford, MA. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

5 Counts - Willful Attempt to Evade and Defeat Income Taxes 
1 Count Willful Making and Subscribing a False Income Tax Return 
4 Counts Willful Failure lo File State Income Tax Retvims 
(AAG L. Balboni) 

Commonwealth v. 770 Broadway. Inc. 
(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

770 Broadway, Inc. operates five retail bedding and fiimittire stores in 
Southeastern Massachusetts under the name of Off-Track Bedding. Marie 
Campbell is the corporations bookkeeper. The defendants are charged 
with filing 3 1 false and fi-audulent monthly sales tax returns for the periods 
of March 1992 through December 1994. Campbell allegedly prepared and 
filed each of the false and fraudulent returns, and in doing so, used four 
distinct schemes to underreport the sales tax owned. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

3 Counts Willful Failure to Account For and Pay Over Sales Tax 
(AAG M. Mulligan) 

Commonwealth v. Marie Campbell 
(Tax Prosecution) 

DEFENDANT DESCRIPTION: 

See above description. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

3 Counts Willful Failure to Account for and Pay Over Sales Taxes 
3 Counts Willful Filing of False Sales Tax Returns 
(AAG M. Mulligan) 

Commonwealth v. Philip J. Tavares 
(Tax Prosecution) 



93 



DEFENDANT DESCRIPTION: 

The Commonwealth alleged that Tavares lived in New Hampshire and 
worked as a physician in Massachusetts during the years 1991 through and 
including 1996. During that period, he failed to file non-resident income 
tax returns, yet earned approximately four hundred ninety seven thousand 
seven hundred seventy five ($497,775.00) dollars. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

6 Counts Willful Failure to File Non-Resident state Income Tax Returns 
(AAG S. Hartry) 



4/9/98 Commonwealth v. Richard T. Cousins 

(Tax Prosecution) 



DEFENDANT DESCRIPTION: 

Cousins, president and treasurer of Land & Sea. allegedly failed to file or 
pay state withholding taxes for 1993 and 1994. The corporation also 
allegedly failed to pay withholding taxes for 1995. Additional charges 
involve Cousins wilfully making and filing fi-audulent returns for 1993, 
1994, and 1995. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

3 Counts Willfijl Failure to Account For and Pay Over Withholding Taxes 
3 Counts Willful Making and Subscribing to False Massachusetts Resident 
Income Tax Returns 

(AAG S. Hartry) 



4/9/98 Commonwealth v. Irving Morgan 

(Tax Prosecution) 



DEFENDANT DESCRIPTION: 

This case involves Morgan's alleged failure to file and pay taxes for the 
years during 1991 through and including 1995, in the amount totaling 
approximately twenty two thousand seven hundred fifty seven ($22,75.25) 
dollars and twenty five cents on approximately four hundred thousand 
($400,000.00) dollars in income. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

5 Counts Willful Failure to File Income Tax 
(AAG S. Hartry) 



94 



5/26/98 



6/10/98 



6/11/98 



Commonwealth v. Angela Spears a.k.a. Siannan Sperseneau 
(Larceny Prosecution) 

DEFENDANT DESCRIPTION: 

Defendant Sperseneau (aka Spears) allegedly enrolled as a graduate 
student at Boston University, and then submitted false information on 
B.U. applications for student loans. In reliance on the information, BU 
gave her over $54,000.00 in federal student loans. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

7 Counts Larceny Over $250 
(AAG P. McGovem) 

Commonwealth v. Charles Victor. II 
(Embezziement Prosecution) 

DEFENDANT DESCRIPTION: 

This Board of Bar Overseers referral involves an attorney who, while 
serving as trustee, allegedly misappropriated over $450,000 from seven 
trusts established for children who suffered lead poisoning injuries. A 
significant amount of money withdrawn form the trusts was deposited into 
Victor's personal accounts and then allegedly converted for his own use. 

COUNTIES CHARGED: Suffolk 

CHARGES: 

6 Counts Fiduciary Embezzlement 
(AAG M. Mulligan) 

Commonwealth v. Arthur J. Bradley 
(Larceny Prosecution) 

DEFENDANT DESCRIPTION: 

This disbarred attorney allegedly acted under a power of attorney for an 
elderly client and proceeded to embezzle all of his funds - roughly 
$63,000. 

COUNTIES CHARGED: Essex 

CHARGES: 

5 Counts Larceny Over $250 
(AAG M. Parks) 

Commonwealth v. Jeffrey Boxer 
(Larceny Prosecution) 

DEFENDANT DESCRIPTION: 



95 



This temporarily suspended attorney allegedly solicited clients suffering 
from investment losses, and then embezzled the settlements he obtained 
for them. Several of the victims are elderly and one is disabled. 

COUNTIES CHARGED: Middlesex 

CHARGES: 

1 Count Larceny Over $250 
(AAG M. Parks) 



V. CASES DISPOSED FISCAL YEAR 1998 
A. Convictions & Dispositions . 

Conviction Date Case Description 

7/97 



8/97 



Commonwealth v. Christopher Butler 
(Tax Prosecution) 
(AAG Hartry) 

COURT: Suffolk Superior Court 

JUDGE: Lauriat 

REFERRAL: DOR 

CHARGES: 5 Counts Willful Failure to File Income 

Taxes 
#97-10645 

SENTENCE: Over the Commonwealth's objection, the 

Court placed the defendant on pre-trial 
probation for a period of three years to end 
on 7/1/2000. 

Commonwealth v. Leonard Alfonso 
(Larceny/Perjury/Filing False Medicaid Claim Prosecution) 

(AAG Hartry) 

COURT: Suffolk Superior Court 

JUDGE: Rouse 

REFERRAL: N/A 

CHARGES: Larceny Over $250 

#91-25364-001 

Filing False Medicaid Claim 

#91-25364-002-004 

Perjury 

#91-25364-005-007 

False Representation to Welfare Department 

#91-25364-008 



96 



SENTENCE: The Court amended its original restitution 

order from $38,000 to $30,800 and remitted 
the $10,000 fine. The Court denied the 
defendant's request for termination of his 
probation. The same conditions remain in 
effect. The defendant has paid all of the 
amended order of restitution. AAG Hartry 
recommended full payment of restitution 
and fines. 



8/97 



Commonwealth v. John Gilmore 
(Petition for Writ of Habeas Corpus) 

(AAG Parks) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Worcester Superior Court 

Donahue 

N/A 

(Interstate rendition case) 



SENTENCE: 



Pefition for Writ of Habeas Corpus denied. 



8/97 



Commonwealth v. Edwin Kaplan 
(Insurance Fraud Prosecution) 

(AAG Parks) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Suffolk Superior Court 

DelVecchio 

IFB 

1 Counts Insurance Fraud 

#95-10610-001 

6 Counts Larceny Over $250 

#95-10610-002 



SENTENCE: The defendant plead guilty to all charges. 

#SUCR95-10610-001 - Insurance Fraud: 
Counts 1-2-6 1/2 months HOC committed, 
4-5 Cedar Junction suspended for 5 years 
with probation. Conditions include 
$100,000 restitution and reporting 
requirements as to future insurance claims. 
Guilty file to counts 3-10. 
#SUCR95- 106 10-002 - Larceny Over $250 - 
Count 1 -#95-10610-002 - Larceny Over 
$250 - Count 1 - 4-5 Cedar Junction 
suspended for 5 years with probation 
concurrent with SUCR95- 106 10-001 - guilty 
filed. 
$60 Victim/witness fee. 



97 



8/97 Commonwealth v. Adam Kessler 

(Fraud Prosecution) 

(AAG Parks ) 

COURT: Suffolk Superior Court 

JUDGE: DelVecchio 

REFERRAL: IFB 

CHARGES: 1 Count Motor Vehicle Insurance Fraud 

#96-12008-001 

SENTENCE: Plead guilty. 1-3 Years probation, $50,000 

restitution, reporting requirements as to 
future insurance claims. 
$35 Victim/witness fee. 



8/97 



8/97 



Commonwealth v. Joseph Jaskulski 
(Tax Prosecution) 
(AAG Balboni) 

COURT: Suffolk Superior Court 

JUDGE: DelVecchio 

REFERRAL: DOR 

CHARGES: 1 Count Failure to Account For and Pay 

Over Sales Tax - #97-10611-001 
4 Counts - Filing False Sales Tax Returns - 
#97-10611-002 

SENTENCE: #97-1061 1-001 - Failure to Account For and 

Pay Over Sales Tax - 2 Years probation, 
$10,000 criminal fine, $45 probation 
supervision fee, cooperate with DOR. 
Probation to be supervised by Hampden 
County - Springfield Superior Court 
Probation Department. 
#97-1061 1-002 - Filing False Sales Tax 
Returns - All counts concurrent with #97- 
10611-001. 
$60 Victim/witness fee. 

Commonwealth v. Anthonv Correia 
(Narcotics Prosecution) 
(AAG Parks) 

COURT: New Bedford District Court 

JUDGE: Quinn 

REFERRAL: Narcotics & Special Invesfigations (OAG) 

CHARGES: Possession with intent to distribute class D 

substance Conspiracy to violate controlled 



98 



substances act - #9633CR-7899 



9/97 



SENTENCE: Committed to House of Correction for two 

years on drug charges and an additional one 
year on and after for violation of probation 
on previous charge. 

Commonwealth v. Priscilla Martin 
(Larceny Prosecution) 

(AAG Starkey) 



COURT: 



JUDGE: 

REFERRAL: 

CHARGES: 



Norfolk Superior Court 
(Suffolk Superior Case sentencing only in 
Norfolk) 
Chemoff 

1 Count Receiving Stolen Property - 
#96-11759 



SENTENCE: Pursuant to a pre-indictment plea agreement 
upon the defendant's successful cooperation, 
the court imposed a sentence of 6 months at 
the HOC, suspended for 2 years; payment of 
$1 5,097 in restitution, with terms of 
probation set by the court as follows: 
payment of the full restitution amount to be 
scheduled by probation over the 2 years 
suspended sentence. 



10/97 Commonwealth v. John Bolduc 

(Tax Prosecution) 

(SAAG Zaikis) 

COURT: Suffolk Superior Court 

JUDGE: Ball 

REFERRAL: DOR 

CHARGES: 4 Counts Willftxl Attempt to Evade and 

Defeat Taxes - #95-1 1 146-001 
4 Counts Willful Filing of False Tax Returns 
-#95-1146-002 

1 Count Willfol Failure to Account for and 
Pay Over Withholding Taxes - 
#95-11146-003 

SENTENCE: Willftil Attempt to Evade and Defeat Taxes: 

Court imposed 3 months house arrest, 
$25,000 fine, 1 year probation. 
Willful Filing of False Tax Returns and 
Willful Failure to Account For and Pay Over 



99 



Withholding Taxes: Guilty plea filed. 
$60 Victim/witness fee. 



1 0/97 Commonwealth v. David Brock 

(Larceny Prosecution) 

(AAG Parks) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Suffolk Superior Court 
Ball 

1 Count Larceny Over $250 
SUCR97- 10929 



SENTENCE: 2 Years House of Correction 4.5 months to 

serve, deemed served, balance suspended 
with 3 years probation. 
$60 Victim/witness fee. 

1 /97 Commonwealth v. Donald Pratt 

(Tax Prosecution) 
(AAG Balboni) 

COURT: Suffolk Superior Court 

JUDGE: Ball 

REFERRAL: DOR 

CHARGES: 3 Counts Failure to Account For and Pay 

Over Meals Tax - #97-10647-001 
3 Counts Failure to Account For and Pay 
Over Withholding Taxes - #97-10647-002 
3 Counts Failure to File Corporate Excise 
Tax Returns- #97-10647-003 

SENTENCE: Guilty plea to all counts. Sentence imposed 

2 years probation on all counts to be 
concurrent, $45 per month probation 
supervision fee until all fines are paid-in- 
full. 

$60 Victim/witness fee. 
1 0/97 Commonwealth v. Subway Darthmouth. Inc. 

(Tax Prosecution) 

(AAG Balboni) 

COURT: Suffolk Superior Court 

JUDGE: Ball 

REFERRAL: DOR 

CHARGES: 1 Count Failure to File Corporate Excise 

Tax Returns -#97-10648 



SENTENCE: 



Guilty filed. Court imposed $3,000 fine on 



100 



corporation. 



10/97 Commonwealth v. Southeastern Food Management. Inc. 

(Tax Prosecution) 
(AAG Balboni) 

COURT: Suffolk Superior Court 

JUDGE: Ball 

REFERRAL: DOR 

CHARGES: 1 Count Failure to File Corporate Excise 

Tax Returns -#97-10649 

SENTENCE: Guilty filed. Court imposed $3,000 fine on 

corporation. 



1 0/97 Commonwealth v. Subway Rockdale. Inc. 

(Tax Prosecution) 
(AAG Balboni) 

COURT: Suffolk Superior Court 

JUDGE: Ball 

REFERRAL: DOR 

CHARGES: 1 Count Failure to File Corporate Excise 

Tax Returns -#97-10650 

SENTENCE: Guilty filed. Court imposed $3,000 fine on 

corporation. 



10/97 Commonwealth v. William Dispirito 

(Tax Prosecution) 
(AAG Balboni) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Suffolk Superior Court 
Hamlin 

1 Count Willful Failure to Account For and 
Pay Withholding Tax - #96-10581-001 
1 Count Willful Failure to File Corporate 
Excise Tax Returns - #96-10581-002 



SENTENCE: Willful Failure to Account For and Pay 

Withholding Tax: 2 years HOC suspended 
for 2 years, 2 years probation condition of 
probation 3 months home confinement 
monitored by electronic bracelet, costs to be 
paid by defendant, $45 per month probation 



101 



supervision fee until all fines are paid-in- 
full. 

Willful Failure to File Corporate Excise Tax 
Returns: 1 year HOC suspended for 2 years, 
2 years probation to run concurrent with 
Willfiil Failure to Account For and Pay 
Withholding Tax. $5,000 total fine plus 
surfine. Payment schedule to be determined 
by probation. 
$60 Victim/witness fee. 



10/97 Commonwealth v. Scott McKay 

(Narcotics Prosecution) 

(AAG Balboni) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



New Bedford District Court 
Turcotte 

1 Count - Possession with Intent to 
Distribute Marijuana - #9633CR7897A: 
1 Count Conspiracy to Violate Controlled 
Substances Act - #9633CR7897B 
1 Count Possession of Firearm - 
#9633CR7897C 



SENTENCE: Possession with Intent to Distribute 

Marijuana: 2 1/2 HOC sentence stayed until 
December 1 , 1 997, 1 year to be serve 
balance suspended for 2 years probation. 
Conspiracy to Violate Controlled Substances 
Act: Guilty filed. 

Possession of Firearm: 2 Vz years HOC 
suspended, as of October 31,1 997, if 
probation is violated during stay of sentence 
or defendant fails to appear for surrender on 
December 1 , 1 997. full 2 V2 years imposed 
on and after sentence on possession with 
intent to distribute. 



1 0/97 Commonwealth v. Paul S. Dolan 

(Larceny/Securities Fraud Prosecution) 

(AAG Starkey) 

COURT: Norfolk Superior Court (Consolidated Plea) 

JUDGE: Barrett 

REFERRAL: SOS 

CHARGES: Norfolk: #104354-9 

3 Counts Larceny Over $250 



102 



3 Counts Sales and Purchases 

Suffolk: #97-11878-001-002 
28 Counts Larceny Over $250 
28 Counts Sales and Purchases 

SENTENCE: Count One of Norfolk indictment: 24 

« months HOC committed, with a consecutive 

from and after term of 24 months HOC 
committed on Count Two, with a 
■•; . consecutive from and after term of 1 8 

months HOC committed on Count Three, 
for a total of sixty-six (66) months of 
incarceration in the HOC, committed. On 
Count Four, an additional sentence of 24 
months in the HOC, suspended for 5 years, 
with $650,000 in restitution and the 
following condition of supervised probation: 
The completion of 250 hours of community 
service, refrain from any occupation 
requiring the sales and purchases of 
securities or investment advice, and undergo 
evaluation and counseling. 
$60 Victim/witness fee. 



12/97 Commonwealth v. Shawn Snow 

(Larceny Prosecution) 

(AAG St*rkey) 

COURT: Essex Superior Court 

JUDGE:. Bohn 

REFERRAL: Amesbury Police Department 

CHARGES: 1 Count Larceny Over $250 

SENTENCE: Agreed upon recommendation of 2 years 

House of Correction, 6 months to serve, 
balance suspended for 2 years, and 
$20,307.35 in restitution. 
$60 Victim/witness fee. 



1 2 /97 Commonwealth v. Edward Kaiser 

(Tax Prosecution) 

(SAAQ Zaikis) 

COURT: Suffolk Superior Court 

JUDGE: Volterra 

REFERRAL: 



103 



CHARGES: 3 Count Willful Failure to File Income Tax 

Returns -#97-10577 

SENTENCE: Defendant placed on pre-trial probation for 3 

years. Ordered to pay $25,000 as costs of 
prosecution. Further ordered to pay all taxes 
and penalties and file all tax returns. 



1/98 Commonwealth v. Stewart Swinamer. Jr. 

(Tax Prosecution) 
(AAG Balboni) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



SENTENCE: 



Suffolk Superior Court 

Mulligan 

DOR 

1 Count Willfiil Failure to Account For and 

Pay Sales Taxes - #97-1 1044-001 

1 Count Willful Failure to Account For and 
Pay Withholding Taxes - #97-1 1044-002 

On an unagreed upon plea the Defendant 
received the following sentence over the 
Commonwealth's objection: 
Willful Failure to Account For and Pay 
Sales Taxes: 3 Months HOC suspended for 

2 years unsupervised probation, $5,000 total 
fine plus surfine. 

Willful Failure to Account For and Pay 
Withholding Taxes: Placed on file without 
change of plea. 
$60 Victim/wdtness fee. 



1/98 Commonwealth v. Ronald G. Schab 

(Tax Prosecution) 

(AAG Hartry) 

COURT: Suffolk Superior Court 

JUDGE: Donovan 

REFERRAL: DOR 

CHARGES: 5 Counts Failure to File Non-Resident Tax 

Returns -#97-1 1552 

SENTENCE: Upon a guilty plea, the defendant was 

sentenced to 1 year House of Correction 
suspended for 2 years, and placed on 2 years 
probation. He was further ordered to pay 
$1,000 fine on each count. 



104 



$60 Victim/witness fee. 



1/98 



Commonwealth v. Algie J. Urbonas 
(Larceny/Securities Fraud Prosecution) 
(AAG Parks) 

COURT: Essex Superior Court 

JUDGE: Whitehead 

REFERRAL: SOS 

CHARGES: Larceny Over $250 - #9677CR3 1 54-001 

Larceny Over $250 - #9677CR3 154-003 
Larceny Over $250 - #9677CR3 154-005, 
#9677CR3 1 54-006 and #9677CR3 1 54-008 
Securities Fraud - #9677CR3 152-00 1-008 
and 010 

Offering Unregistered Securities - 
#9677CR3 153-00 1-008 and 010 

SENTENCE: Larceny Over $250 - #9677CR3 154-001: 

2 years House of Correction committed 
Larceny Over $250 - #9677CR3 154-003: 3 
years probation 

Larceny Over $250 - #9677CR3 154-005, 
#9677CR3 154-006 and #9677CR3 154-008: 

3 years probation concurrent with 
#9677CR3 154-003 

Securities Fraud - #9677CR3 152-001-008 

and 010: GuiUy filed. 

Offering Unregistered Securities - 

#9677CR3153-001-008 and 010: Guilty 

filed. 

Conditions of probation: $10,050 restitution, 

no contact with victims, no work as a tax 

preparer/financial planner. 

$60 Victim/witness fee. 

Note: Counts 9,2,4,7 and 10 of larceny 
indictment nol prossed due to witness 
unavailability (post-indictment death) and 
insufficiency of evidence. 



1/98 Commonwealth v. Osbert Baker 

(Larceny/Conspiracy Prosecution) 
(AAG Brekka) 



COURT: 
JUDGE: 



Middlesex Superior Court 
Cowin 



105 



REFERRAL: Filene's Basement 

CHARGES: 1 Count Larceny Over $250 - 96-1498-001 

1 Count Uttering - #96-1498-002 
1 Count Conspiracy -Attempt to Commit a 
Crime -#96-1498-003 
1 Count Attempt to Commit a Crime - 
#96-1498-004 

SENTENCE: Larceny Over: 2 years House of Correction 

suspended for 5 years, 1 000 hours 
community service in first two years, 
$49,000 restitution. 

Uttering/Conspiracy/Attempt to Commit a 
Crime: All charges concurrent with Larceny 
prosecution. 
$60 Victim/witness fee. 



1/98 United States v. Lars Bildman 

(Tax Prosecution) 

(AAG Balboni acting as Special AUSA) 

COURT: U.S. District Court 

JUDGE: U.S. District Court Judge Nathaniel M. 

Gorton 
REFERRAL: DOR 

CHARGES: 3 Counts Filing False Federal Tax Returns 

SENTENCE: U.S. District Court Judge Nathaniel M. 

Gorton conditionally accepted the plea 
requiring Lars Bildman to be imprisoned for 
a period of 21 months and $30,000 fine. 

1/98 United States v. Lars Magnuson 

(Felony Prosecution) 

(AAG Balboni acting as Special AUSA 

COURT: U.S. District Court 

JUDGE: U.S. Disttict Court Judge Nathaniel M. 

Gorton 
REFERRAL: NA 

CHARGES: Misprision of a Felony 

SENTENCE: Also plead guilty to misprision of a felony 

relating to the destruction of documents and 
received 2 years probation. 



1/98 



Commonwealth v. Francis Perkins 



106 



(Larceny Prosecution) 

(AAG Starkey) 

COURT: Essex Superior Court 

JUDGE: Whitehead 

REFERRAL: Amesbury PoHce Department 

CHARGES: 1 Count Larceny Over $250 - #00225 

SENTENCE: Defendant plead guilty. Sentenced to 2 

years in the House of Correction, 6 months 

to serve, balance suspended for 3 years, and 

$7,860 in restitution. Judge Whitehead 

retained jurisdiction to supervise restitution 

payments. 

$60 Victim/witness fee. 

1/98 Commonwealth v. Steven Wheeler 

(Larceny /Unauthorized Practice of Law Prosecution) 

(AAG Starkey) 

COURT: Essex Superior Court 

JUDGE: Whitehead 

REFERRAL: Amesbury Police Department 

CHARGES: 1 Count Larceny Over $250 - #002252 

1 Count Unauthorized Practice of Law - 

#002253 

SENTENCE: Defendant plead guilty. Sentenced to 6 

months in the House of Correction, 
suspended for 1 year of probation, with 
$1,000 in restitution to be paid forthwith . 
The Court also issued a Stay-Away order 
from the victim against Wheeler. 
$60 Victim/witness fee. 



2/98 Commonwealth v. Karen Freeman 

(Larceny/Conspiracy Prosecution) 

(AAG Brekka) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



SENTENCE: 



Middlesex Superior Court 

Cowin 

Filene's Basement 

1 Count Larceny Over $250 - #96-1499-001 

1 Count Conspiracy - #96-1499-002 

1 Count Attempt - #96-1499-00 

Larceny Over $250: 2 years House of 
Correction suspended for 5 years, 500 hours 



107 



community service, $2,800 restitution. 
Conspiracy: Nolle prosequi 
Attempt: Nolle prosequi 
$60 Victim/witness fee. 



2/98 Commonwealth v. Nancy J. Burgess 

(Larceny Prosecution) 

(AAG Parks) 

COURT: Middlesex Superior Court 

JUDGE: Lopez 

REFERRAL: N/A 

CHARGES: (8 Counts Larceny; 3 Counts Conspiracy) 

Larceny - #96-532-001-002 
Conspiracy to Commit Larceny - 
#96-532-003 

Larceny - #96-532-004-005, 007 
Conspiracy to Commit Larceny - 
#96-532-006 



SENTENCE: #96-532-001-002 - Larceny - 21 months - 21 

months and 1 day State Prison committed, 5 
years probation from and after release. 
#96-532-003 - Conspiracy to Commit 
Larceny - Guilty filed. 
#96-532-004-005, 007 - Larceny 
#96-532-006 Conspiracy to Commit 
Larceny 

All remaining charges received concurrent 
sentence with similar terms and conditions. 
$60 Victim/witness fee waived by Judge 
Lopez. 

2/98 Commonwealth v. Donald Perkins 

(Larceny Prosecution) 

(AAG Starkey) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Essex 

Whitehead 

Amesbury Police Department 

1 Count Larceny Over $250 - 

#9777CR002250 



SENTENCE: 2 years House of Correction, 147 days to 

serve, balance suspended for 3 years, with 
$4,020.96 in restitution, and a Stay-Away 
Order from the victim. 
$60 Victim/witness fee. 



108 



2/98 Commonwealth v. Joseph Haven 

(Tax Prosecution) 
(SAAG Zaikis) 

COURT: Suffolk Superior Court 

JUDGE: Donovan 

REFERRAL: DOR 

CHARGES: 2 Counts Willful Filing of False Income Tax 

Returns -#97-10576 

SENTENCE: Defendant plead guilty. Sentenced to $2,000 

fine or 300 hours of community service. 
Defendant also placed on probation for two 
years. 
$60 Victim/witness fee. 



2/98 Commonwealth v. Carroll Lowenstein 

(Tax Prosecution) 

(SAAG Zaikis) 

COURT: Suffolk Superior Court 

JUDGE: Donovan 

REFERRAL: DOR 

CHARGES: 5 Counts Willful Failure to File Income Tax 

Returns -#97-10531-001 
2 Counts Willful Failure to File Excise Tax 
Returns -#97-10531-002 

SENTENCE: Willful Failure to File Income Tax Returns: 

Defendant plead guilty. Sentenced to 
$12,000 fine. 

Willful Failure to File Excise Tax Returns: 
Guilty filed. Defendant also placed on 
probation for three years. 
$60 Victim/witness fee. 



3/98 Commonwealth v. Kevin Snow 

(Larceny Prosecution) 

(AAG Starkey) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Essex Superior Court 

Cratsley 

Amesbury Police Department 

1 Count Larceny Over $250 - 

9777CR002248 



109 



SENTENCE: Defendant plead guilty. Sentenced to 3 years 

probation. $3,000 restitution forthwith. 
$13,000 restitution to be paid in monthly 
payments of $390 per month until the 
remaining $13,000 is paid. The Judge also 
issued a Stay- A way order from the victim. 
$60 Victim/witness fee. 



3/98 Commonwealth v. Joseph C. Dutra 

(Larceny Prosecution) 

(AAG Hartry) 

COURT: New Bedford Superior Court 

JUDGE: Bumes 

REFERRAL: N/A 

CHARGES: 3 Counts Larceny Over $250 - #97-0191 A 

4 Counts Larceny Over $250 - #97-019138 

SENTENCE: Defendant plead guilty. Sentenced to 1 year 

House of Correction suspended, placed on 2 
years probation. Ordered to pay $7,091.05 
restitution. 
$60 Victim/witness fee. 



3/98 Commonwealth v. Joseph Murray. 

(Larceny Prosecution) 

(AAG Hartry) 

COURT: Middlesex Superior Court 

JUDGE: Grabeau 

REFERRAL: Framingham, Stoughton, State Police Logan 

CHARGES: 2 Counts Larceny Over $250 - 

#97-914-001,002 
2 Counts Larceny Over #250 - 
#97-914-003 

SENTENCE: #97-9 1 4-00 1 , 002 - Larceny Over $250: 

Defendant plead guilty. Placed on 2.5 years 
probation. Ordered to pay $12,149 
restitution and return stolen goods in 
defendant's custody, payment of storage fee 
not to exceed $500. 

#97-914-003 Larceny Over $250: 2 years 
probation to run concurrent with 001, 002. 
$60 Victim/witness fee. 



4/98 



Commonwealth v. Barbara Shea 



110 



(Tax Prosecution) 

(SAAG Zdikis) 

COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Suffolk Superior Court 

Garsh 

DOR 

1 Count Willful Failure to Pay State Taxes 

#98-10498 



SENTENCE: 3 years probation, $25,000 fine. 

$60 Victim/witness fee. 

4/98 Commonwealth v. Glenn Grossjung 

(Tax Prosecution) 

(SAAG Zaikis ) 

COURT: Suffolk Superior court 

JUDGE: Garsh 

REFERRAL: DOR 

CHARGES: 1 Count Willful Failure to Pay State Taxes 

#98-10499 

SENTENCE: 3 years probation, $25,000 fine. 

$60 Victim/wintess fee. 



4/98 Commonwealth v. Joseph Teti 

(Tax Prosecution) 

(SAAG Zaikis ) 

COURT: Suffolk Superior court 

JUDGE: Garsh 

REFERRAL: DOR 

CHARGES: 1 Count Willftil Failure to Pay State Taxes 

#98-10497 

SENTENCE: 3 years probation, $25,000 fine. 

$60 Victim/wintess fee. 



4/98 Commonwealth v. Wayne Prue 

(Tax Prosecution) 

(SAAG Zaikis ) 

COURT: Suffolk Superior Court 

JUDGE: Garsh 

REFERRAL: DOR 

CHARGES: 1 Count Willful Failure to Pay State Taxes 

#98-10500 



111 



SENTENCE: 3 years probation, $25,000 fine. 

$60 Victim/witness fee. 



4/98 Commonwealth v. Paul Brindle. Ill 

(Tax Prosecution) 
(SAAG Zaikis ) 

COURT: Suffolk Superior court 

JUDGE: Garsh 

REFERRAL: DOR 

CHARGES: 1 Count Willful Failure to Pay State Taxes 

#98-10501 

SENTENCE: 3 years probation, $25,000 fine. 

$60 Victim/wintess fee. 



5/98 Commonwealth v. Roland Cassavant. Jr. 

(Tax Prosecution) 
(SAAG Zaikis) 

COURT: Suffolk Superior Court 

JUDGE: Gershengom 

REFERRAL: DOR 

CHARGES: 1 Count Wilful Attempt to Evade Corporate 

Excise Taxes - #SUCR94- 10379 



SENTENCE: 



Guilty; $4,000 fine. 
$60 Victim/witness fee. 



5/98 Commonwealth v. Michael Bloom 

(Tax Prosecution) 

(SAAG Zaikis) 

COURT: Suffolk Superior Court 

JUDGE: Volterra 

REFERRAL: DOR 

CHARGES: 1 Count Willful Failure to Pay State Taxes 

#98-10496 



SENTENCE: 



Guilty; $5,000 fine. 



5/98 Commonwealth v. Man Kin "Daily" Chan 

(Financial Crimes Prosecution) 

(AAGs Brekka, Silverfine, Grossman ) 



112 



COURT: Suffolk Superior Court 

JUDGE: King 

REFERRAL: N/A 

CHARGES: 1 Count Larceny Over $250 - 

#96-11048-001 

1 Count Making Contracts of Bucketing; 
Keeper of Shop - #96-1 1048-002 
1 Count Securities Fraud - #96-1 1048-003 
1 Count Fraudulently Overstating A 
Company's Assets - #96-1 1048-004 
1 Count Conspiracy to Commit Larceny 
Over $250 -#96-1 1048-005 
1 Count Conspiracy to Keep a Bucket Shop 
- #96-11048-006 

I Count Conspiracy to Commit Securities 
Fraud -#96-1 1048-007 
1 Count Conspiracy to Fraudulently 
Overstate a Company's Assets - 
#96-11048-008 

SENTEFCE: Larceny Over $250: 4 years - 4 and 1 dav 

State Prison. $93.548 restitution. 
Making Contracts of Bucketing; Keeper of 
Shop; Securities Fraud; Fraudulently 
Overstating A Company's Assets: 1 year 
House of Correction concurrent with 
Larceny Over 

Conspiracy to Commit Larceny Over $250; 
Conspiracy to Keep a Bucket Shop; 
Conspiracy to Commit Securities Fraud; 
Conspiracy to Fraudulently Overstate a 
Company's Assets: Filed guilty. 
$60 Victim/witness fee. 



5/98 Comnoiwealth v. Odon ''Danny" Do Vale 

(FinaiQal Crimes Prosecution) 

(AAis Brekka, Silverfme, Grossman) 



COf RT Suffolk Superior Court 

JUEGE: King 

REIERIAL: N/A 

CHiRGES: 1 Count Larceny Over $250 - 

#96-11052-001 

Count Making Contracts of Bucketing; 
1 Keeper of Shop - #96- 1 1 052-002 

y 1 Count Securities Fraud - #96- 1 1 052-003 

1 Count Fraudulently Overstating a 



113 



Company's Assets - #96-11052-004 

1 Count Conspiracy to Commit Larceny 

Over $250 - #96-11052-005 

1 Count Conspiracy to Keep a Bucket Shop 

-#96-11052-006 

1 Count C )nspiracy to Commit Securities 

Fraud -fOS- 11052-007 

1 Count f jnspiracy to Fraudulently 

Overstr v a Company's Assets - 

#96-11 J 2-008 

SENTENCE: Defen iiiit found guilty to all charges 

coven d by 001-004. 
Larce.v Over $250: 30-36 months state 
prison * mcurrent with Fraudulently 
Over: ti ing a Company's Assets 
Maki 1} Contracts of Bucketing; Keeper of 
Shop:]led. 

Secaii s Fraud: 30-36 months state prison 
cone ir nt with Fraudulently Overstating a 
Com Of ly's Assets 

FrauJtiently Overstating a Company's 
Asse s 30-36 months state prison. 
Consniv:y to Commit Larceny Over $250; 
Consora :y to Keep a Bucket Shop; 
Conspracy to Commit Securities Fraud; 
Conspr cy to Fraudulently Overstate a 
Compui /'s Assets: nolle prosequi. 
$60 Vitim/witness fee. 



5/98 Commonwealth v. Shine 1 U Ed" Lau 

(Financial Crimes ProsecWon) 

(AAGs Brekka, Silverfine. Oussman) 

COURT: Sufful!^ uperior Court 

JUDGE: King 

REFERRAL: N/A 

CHARGES: 1 Count^aiceny Over $250 - 

#96- rC (-001 

1 Couiil ■ kj ing Contracts of Bucketing; 
Keep':itiilop -#96-11050-002 
1 Coiiit Sciirities Fraud - #96-1 1050-002 
1 Court Fatdulently Overstating a 
Compay'sAssets - #96-1 1050-004 
1 Coi.ni (nspiracy to Commit Larceny 
Over $J"- #96-11050-005 
1 Cou.ili tnspiracy to Keep a Bucket Shop 
-#96-lI»;0-006 



114 



SENTENCE: 



1 Count Conspiracy to Commit Securities 

Fraud -#96-1 1050-007 

1 Count Conspiracy to Fraudulently 

Overstate a Company's Assets - 

#96-11050-008 

1 Count Perjury - #96-1 1050-009 

Not guilty to all charges: 



5/98 Commonwealth v. Arthur Stephen Lane 

(Tax I*rosecution) 
(SAAG Zaikis) 

COURT: Suffolk Superior Court 

JUDGE: Volterra 

REFERRAL: DOR 

CHARjGES: 5 Counts Willful Filing of False Income Tax 

^ Returns -#97-10528 

SENTEJSCE: $ 1 0,000 fine, 2 years probation 6 months in 

I the House suspended 



5/98 



5/98 



Commonwealth v. Melinda L. Lowe 
(Tax Prosecution) 
(AAG Parks) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



SENTENCE: 

I 



Suffolk Superior Court 

White 

DOR 

3 Counts Willful Failure to Account For and 

Pay Over Room Occupancy Taxes - 

#96-10550-001 

3 Counts Willful Failure to File Room 

Occupancy Taxes- #96-10550-002 

Filed without a change of plea. 



Commonwealth v. J&M Taylor Companv. Inc. 
(Tax prosecution) 

(AAG Parks) 



COURT: 
JUDGE: 
REFERRAL: 
CHARGES: 



Suffolk Superior Court 

White 

DOR 

3 Counts Willful Failure to File Room 

Occupancy Tax Returns - #96-1 055 1 -001 



115 



SENTENCE: Defendant plead guilty. Ordered to pay - 

Count 1: $10,000 fine, $2,500 surfine 
$12,500 court costs. 

Count 2, 3: $20,000 fine, $5,000 surfine. 
Total fines, surfines and costs $50,000. 



5/98 . Commonwealth v. Patrick Forte 

(Larceny/Tax Prosecution) 

(AAG Balboni) 

COURT: Suffolk Superior Court 

JUDGE: Brady 

REFERRAL: N/A 

CHARGES: 3 Counts Larceny Over $250 - 

#97-10836-001 

4 Counts Failure to File State Tax Returns - 

#97-10836-002 

1 Count Larceny Over $250 - 

#97-10836-003 

SENTENCE: Larceny Over $250: Guilty filed. 

Failure to File State Tax Returns: Guilty 

filed. 

Larceny Over $250: Sentenced to 59 days in 

the House of Correction, credit for time 

served (30 days), balance suspended. Placed 

on 2 years probation conditions of 

probaUon, full restitufion of $19,400 to 

victim Harold Cohen, must remain in 

Massachusetts until full restitution paid. 

Probation supervision fee on community 

service. 

$60 Victim/v«tness fee. 



6/98 Commonwealth v. Robert A. Gatta 

(Insurance Fraud Prosecution) 

(AAG Hartry) 

COURT: Middlesex Superior Court 

JUDGE: Cowin 

REFERRAL: IFB 

CHARGES: 1 Count Fraudulent Insurance Claim - 

#96-2330-001 

1 Count Larceny Over $250 - #96-2330-002 
1 Count Malicious Destruction of Property 
Over $250 - #96-2330-003 



116 



SENTENCE: Fraudulent Insurance Claim: Guilty. 

Defendant plead guilty. 4 Years probation, 

$9,863 restitution, if paid after 2 years, 

probation terminated. 

Nolle prosequi filed on following charges: 

Larceny Over $250 and Malicious 

Destruction of Property Over $250 

$60 Victim/witness fee. 



6/98 Commonwealth v. Harvey Brower 

(Tax Prosecution) 

(SAAG Zaikis) 

COURT: Suffolk Superior Court 

JUDGE: King 

REFERRAL: DOR 

CHARGES: 3 Counts Willful Attempt to Evade Taxes - 

#96-10578 

SENTENCE: Defendant plead guilty. 3 years probation. 

750 hours of community service. 
$60 Victim/witness fee. 



117 



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, the Department of Environmental Protection, 
Environmental Police, and State Police, continued to pull together available government 
resources in the service of enforcing the state's environmental laws. The Strike Force also 
worked with the U.S. Environmental Protection Agency, the U.S. Attorney's Office for the 
District of Massachusetts, the City of Boston, and the Town of Boxford, pursuing joint local, 
state and federal environmental crimes investigations and prosecutions. The Strike Force's 
enforcement efforts encompassed the length and breadth of the Commonwealth, including cases 
in Berkshire County, Essex County, Middlesex County, New Bedford, Suffolk County, and 
Worcester County. 

This fiscal year saw the successftil prosecution of landmark environmental crime cases: 
the first convictions for assault and battery by means of a dangerous weapon against defendants 
who exposed employees to hazardous materials in the workplace; the first conviction for criminal 
violations of Title 5 regulations governing septic system inspectors; the first criminal prosecution 
of a public official for environmental violations; and the first criminal prosecution for interfering 
with a 21E cleanup action. 

During this fiscal year, the Strike Force unit operating out of the Criminal Bureau of the 
Attorney General's office initiated criminal prosecutions against nine individual and corporate 
defendants. The Strike Force resolved cases against 1 5 defendants. Ten were convicted, two had 
their cases continued without a finding after admission of sufficient facts, two had their cases 
placed on file as part of plea agreements with co-defendants, and one case was dismissed. In 
addition, the year saw the continued use of innovative envirormiental crime sentences by the 
Strike Force. 

II. CRIMINAL CASE HIGHLIGHTS 

A. Cases Initiated in Fiscal Year 1 998 

Commonwealth v. William Bertrand : 

This Billerica contractor was indicted for illegal disposal of hazardous waste and 
interfering with a 21 E cleanup action. The defendant was allegedly hired to transport 1000 tons 
of oil contaminated soil fi-om a 21E site to an asphalt batching plant in Maine. Instead, he 
allegedly dumped most of it at a Carlisle home, telling the homeowners it was clean fill. 

Commonwealth v. Jonathan Gabriel : 

The president of New England Demolition, Inc. of Worcester was indicted for alleged 
illegal asbestos removal and disposal and filing a false report with DEP, in connection with 
seven illegal demolition and asbestos removal jobs in the Worcester area over a two-year period. 
The defendant was also charged with violafing an order issued by the DEP in connection with the 
alleged failure to remove solid waste fi-om a site owned by another of the defendant's companies. 
Three Sons Trucking. 



118 



Commonwealth v. Leo Seneca] : 

A Berkshire County grand jury indicted the superintendent of the North Adams 
Department of Public Works for disposal of hazardous waste without a license and in a manner 
which could endanger the environment. The defendant allegedly ordered city employees to dig a 
pit on DPW property and dump three 55-gallon drums of waste oil in the pit, covering it up 
thereafter and misleading DEP inspectors when they arrived to investigate the dumping. 

B. Case Dispositions in Fiscal Year 1998 

Commonwealth v. Ralph Caruso : 

The president of Caruso Construction and Equipment Corp. of Revere was convicted in 
Essex Superior Court of illegal disposal of solid waste. The defendant dumped hundreds of 
truckloads of petroleum-contaminated soil and trash at a Boxford home, claiming it was "clean 
fill" to be used for grading and construction of a septic system. The defendant was sentenced to 
pay $10,000 in restitution to the Boxford homeowner (who had to install a new septic system as 
a result of the defendant's activities), $15,000 in restitution to Boxford for costs incurred in 
connection with the cleanup, $10,000 to the Ipswich River Watershed Association, and a $6250 
fine. He was also placed on probation for a year. 

Commonwealth v. Lowell Fiengold : 

The president of Consolidated Smelting and Refining Co. of Sutton was convicted in 
Worcester Superior Court of assault and battery by means of a dangerous weapon in connection 
with the exposure of company employees to toxic lead dust and fumes. The defendant failed to 
maintain proper ventilation for smelting operations, failed to give the smelter proper protective 
equipment, and allowed toxic lead and fumes to infiltrate the office area where the company 
secretary worked. The defendant was also convicted of storage of hazardous waste in a manner 
which could endanger human health and the environment, transfer of hazardous waste to an 
unlicensed person and without a manifest, and two violations of the clean air act. The defendant 
was fined $40,000, placed on probation for a year, and ordered to perform 300 hours of 
community service. 

Commonwealth v. Donald Lemere : 

This defendant was convicted in Worcester Superior Court of transporting hazardous 
waste without a license or manifest, and disposal of hazardous waste without a license, in 
connection with the dumping of waste paints in a wetland area in Winchendon. He was 
sentenced to one year in jail, 30 days to serve, with the remainder suspended for one year, and 
ordered to perform 50 hours of community service. 

Commonwealth v. Philip Menici : 

This North Shore contractor was convicted in Essex Superior Court of eight counts of 
larceny, and nine coimts of falsifying septic system inspecfion reports, in connection with 
fi-audulent Title 5 inspections. The defendant operated two businesses, DEP Compliance Corp. 
of North Andover, and Philip- Anthony Corp. of Middleton, and falsely claimed to perform 
"certified" septic system inspections at residential properties in Ipswich, Acton, and Topsfield. 
At one property for sale in Ipswich, the defendant provided a report that said he had installed a 
new septic system in compliance with Title 5. After the property was sold, it was discovered that 
the system was not completed and would not have passed inspection. The defendant was 
sentenced to a year in jail, to be followed by two years probation, and ordered to pay $3,010 in 
restitution. 



119 



Commonwealth v. My Van Nguyen : 

This owner of a Dorchester triple-decker was convicted in Suffolk Superior Court of 
illegal disposal of hazardous waste and violating the water pollution act. The defendant 
discharged the contents of two home heating oil tanks to the Boston sewer system during 
renovation of the building. The defendant was also convicted on two counts of violating the air 
pollution act by failing to take measures to prevent asbestos emissions and failing to notify DEP 
of an asbestos removal job in connection with the renovation. The defendant was sentenced to 
one year in jail, suspended, placed on probation for three years, ordered to pay a $15,000 fine and 
perform 300 hours of community service. The case was investigated jointly with the City of 
Boston. 

Commonwealth v. William H. Potter. Jr. : 

The ovmer of a defunct Winchendon manufacturing company was convicted in Worcester 
Superior Court of storing hazardous waste without a license and engaging in an activity which 
could result in pollution of groundwater. The defendant was placed on two years probation and 
ordered to pay $25,000 in fines and $25,000 in restitution to DEP. DEP had incurred costs in 
securing the abandoned site, and overseeing the private cleanup conducted by the company, after 
the Strike Force executed a search warrant at the site. The defendant also contributed $25,000 to 
the Work Environment Justice Fund. 

III. INNOVATIVE SENTENCING 

The Strike Force continued to seek innovative sentences intended to maximize the 
benefits to human health and safety and the environment by requiring companies which commit 
envirorunental crime to pay for their acts. In addition to forcing environmental assessments and 
cleanups, and obtaining restitution for such cleanups previously paid for by the public or by 
innocent victims whose property was illegally polluted, sentences included monies paid to the 
Ipswich River Watershed Association to monitor and maintain water quality in the Ipswich River 
Watershed, the Massachusetts Environmental Law Enforcement Fund, and the University of 
Massachusetts Work Environment Justice Fund. 

The Work Environment Justice Fund, originally created as a result of the Strike Force's 
1994 prosecution of a Somerville lead smelting company, granted its fourth annual awards to 
seed projects for improving workplace health and safety among low income workers. A total of 
$100,000 was awarded to 12 non-profit agencies across the state. 

FINANCIAL INVESTIGATION DIVISION 

The Financial Investigation Division provides the Criminal Bureau with eight 
experienced civilian investigative professionals who investigate and assist in the 
prosecution of white-collar criminal cases. These investigations include larceny, public 
corruption, campaign finance violations, securities fraud, bucketing, tax fraud and all 
other white collar fi-auds which are referred to the Division. The investigators bring to 
the Division many years of experience fi-om investigating cases in local, state and federal 
government as well as private sector venues. 

This fiscal year, the Division was comprised of three Certified Fraud Examiners, 
one Certified Public Accountant, two lawyers and two new investigators from the 
banking and insurance industry. 



120 



During FY98, the members of the Division for all or part of the year were: David 
Baker; Brad Chase, Esq.; Peter Darling, Esq.; Ted Goble, Esq.; Bill Frugoli, CFE; Jim 
McFadden, CFE; Sallyann Nelligan; John O'Connor, CPA; Patrick Ormond, CPA; 
Kristen Vagos; and Paul Stewart, CFE, the Division's Director. 

Investigative Responsibilities 

The investigators assigned to this Division work closely with Criminal Bureau 
prosecutors as well as Massachusetts State Police assigned to the Criminal Investigation 
Division. Investigators may also be required to work on a case by case basis with 
investigative or audit personnel from referring agencies such as the Securities Division of 
the Secretary of State's Office (SOS), Board of Bar Overseers (BBO), Criminal 
Investigations Bureau of the Department of Revenue (CIB), and the Office of the State 
Auditor (OSA). 

All investigators are responsible for designing and implementing investigative 
plans which assess allegations of criminal conduct. These investigations require 
extensive review and analysis of business, personal and banking records to document the 
illegal activities of the white collar criminal. In addition, investigators conduct 
interviews of victims, witnesses and targets, and provide summary witness testimony 
before Superior Court special grand juries and in trial settings. 

Further, utilizing modem computerized technology, investigators are able to scan 
a wide array of informational databases to track and profile potential subjects of criminal 
investigations. 

In addition to working active investigative caseloads, each Division investigator is 
responsible for screening a portion of the hundreds of matters received annually which 
fail to meet guidelines of a respective division or whose allegations do not rise to the 
level of a criminal investigation. 

The majority of the Division's investigative assignments are with the Bureau's 
two primary litigation divisions, Economic Crimes and Public Integrity. The Division 
works closely with the Economic Crimes Division and the Public Integrity Division for 
screening purposes as well as to provide financial investigative assistance. 

During FY98, cases brought to indictment through the work of the Division's 
investigative staff alleged theft of more than $8,600,000.00. In addition, court orders 
from case dispositions included restitution of $923,774.00 to the victims of white collar 
crimes. 

David Baker and Sallyann Nelligan assisted the Environmental Crimes Strike 
Force by researching the titles of more than 60 parcels of land. These searches of both 
registered and recorded land dated back to the mid 1 940s. 

New this year was the assignment of Bill Frugoli to work as the financial 
investigator on the Bureau's investigative arm of the Central Artery Third Harbor Timnel 
Project. Bill is part of the team assigned to investigate and detect fraud v^thin the largest 
public works project in history. 



121 



Administrative Functions 

In addition to our investigative tasks, the Division also performs many 
administrative duties for the Bureau with respect to cars, seized evidence and the 
spending of forfeited funds. Jim McFadden is responsible for the assignment, 
maintenance and reporting on the usage of all Bureau cars. Bill Frugoli is responsible for 
maintaining a log of all money seized by the State Police in association with any arrest. 
The seized money is maintained in a safe deposit box and the contents are inventoried on 
a quarterly basis by Division staff. Additionally, Frugoli maintains an accounting of all 
forfeited funds of the Narcotics and Special Investigations Division (NSIU) which are 
disbursed in accordance with the Commonwealth's forfeiture laws. The accounting 
system is designed as a management tool to retrospectively track spending as well as to 
project future needs. 

Outreach 

The staff is also an integral part of the Bureau's outreach to referral agencies, 
including CIB, the BBO, SOS, and the OSA. CIB. BBO and SOS cases are referred 
through the Economic Crimes Division and OSA cases are referred to the Public Integrity 
Division. 

Training 

Division members have prepared and delivered training sessions to their 
colleagues and have also been part of the office- wide training program. In November, 
1997, Brad Chase taught a three-hour course to the Division on how to " Perform Title 
Searches of Registered and Recorded Land, and Review Probate Court Records." In 
March, 1998, Paul Stewart gave a two-hour presentation on ^'Interview and Report 
Writing Techniques " as part of the Attorney General's office-wide training program. The 
session, which drew more than 100 attendees, was presented agaiin in June, 1998, as part 
of a joint, AGO-DOR Criminal Investigative Training. 

In May, 1998, Jim McFadden and Peter Darling gave a presentation on 
"Financial Investigative Techniques" to a group of Boston Police Detectives as part of a 
program presented by the Boston Clearing House Check Fraud Subcommittee. 

Bill Frugoli and Brad Chase also gave a "Financial Investigative Techniques''' 
presentation to the Southeastern Massachusetts Fraud Association in April, 1998. 

Pat Ormond is the supervisor of the Division's intern program. Through his 
efforts, the Division has been provided with a steady stream of talented interns from 
Boston area schools such as Boston College, Suffolk University and Northeastern 
University. 



122 



NARCOTICS AND SPECIAL INVESTIGATIONS DIVISION 

The Narcotics and Special Investigations (NSI) Division coordinates and 
prosecutes complex, multi-jurisdictional criminal cases targeting non-traditional 
organized criminal organizations and career criminals for prosecution. Additionally, the 
NSI Division investigates and prosecutes large-scale drug trafficking organizations and 
individuals or groups 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. 

An additional area of responsibility for the NSI Division is in high technology 
crimes. The NSI Division, through its High Technology Crime Unit, provides legal, 
technical and investigative support to the law enforcement community in the area of 
seizing computers and successfiilly retrieving the information that they contain, also 
known as computer forensics. The Unit also conducts proactive investigations of 
criminal offenses related to high technology and/or committed through the use of 
computer technology, including, for example, component theft, theft of trade secrets, theft 
or destruction of information, warranty fi-aud as well as crimes committed over the 
Internet. 

Finally, the NSI Division, through its Asset Forfeiture Unit, 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 Commonwealth's forfeiture laws. A percentage of the 
amount forfeited is used for community-based drug awareness and education programs. 

Members of the Division for all or part of FY 98 were: Kimberly Bourgeois, 
AAG; David Breen, AAG; William Brownsberger, AAG; Carole Conley, Support Staff; 
Ramon Melendez, AAG; Gregory Motta, AAG; Linda Nutting Murphy, AAG; Lori 
Parris, AAG; Joanna Powers, Support Staff; Robert N. Sikellis, AAG, Chief; Thomas 
Ulfelder, AAG; and Brett Vottero, AAG. 

HIGH TECH CRIME UNIT 

Last year saw a significant broadening of the Division's responsibilities. In April 
of 1997, Attorney General Scott Harshbarger announced the formation of the High 
Technology Crime Unit, one of the first of its kind in the country and the first in the 
Northeast. The Unit, a joint effort with the Executive Office of Public Safety, is housed 
in the NSI Division and staffed by prosecutors and state and local police officers. The 
creation of the Unit was in recognition of the fact that computer crimes, which in the 
1980s ranked sixth in terms of seriousness and frequency among white collar crimes, 
today rank first. It has drawn from the private and public sector to bring together the best 
technical, investigative and prosecutorial expertise. 

In forming the High Technology Crime Unit, Attorney General Harshbarger 
identified two primary objectives for the Unit. First, working in conjunction with a task 
force comprised of trained state and local law enforcement officers, the Unit acts as a 
resource to the law enforcement community, providing investigative, legal, and technical 



123 



support on computer-related criminal investigations, including searches and seizures 
involving computers. The Unit also provides assistance in the area of computer forensics. 

During the past year, the Unit has provided such forensic, technical and legal 
assistance in hundreds of investigations by local, state and federal law enforcement 
agencies throughout the Commonwealth as well as private industry. These requests for 
assistance have ranged from simple, over-the-phone advice to detailed assistance in the 
drafting and execution of computer- related search warrants to extensive computer 
forensics. The investigations themselves have ranged from major Internet child 
pornography distribution to significant computer hacking. 

The second objective of the Unit is to identify, investigate and prosecute those 
individuals who are committing high tech crimes. Since its inception, the Unit has 
investigated and prosecuted dozens of high technology crimes. Among the general 
categories of crimes were the following: theft of prototype computer components, 
hacking, telecommunications fraud and a wide range of Internet related crimes, including 
child exploitation and dissemination of child pornography, extortion, civil rights 
violations, fraud, embezzlement, copyright infringement, prostitution and gaming. 

Members of the Unit also participated in a number of training programs and 
speaking engagements during the fiscal year. Some of these are outlined below. 

Speakers, High Technology Crime Investigators Association 

AAG Sikellis and Sergeant J.J. McLean of the Medford Police 
Department, on assignment to the High Tech Crime Unit, spoke on issues 
related to computer investigations and computer search warrants at this 
national Association's annual training conference. 

Panelist, "Cyber Crime" Conference 

AAG Sikellis spoke on methods of protecting children from "cyber 
predators" at this conference sponsored by the Norfolk County District 
Attorney's Office and Curry College. 

Speaker, Massachusetts Chiefs of Police Association 

Sergeant McLean gave a presentation entitled "Preparing for Cybercrime" 
and spoke on the resources of the Attorney General's High Tech Crime 
Unit at the Association's annual conference. 

Speakers, Massachusetts Juvenile Police Officers Association 

AAG Sikellis, AAG Murphy, and Sergeant McLean spoke on investigative 
approaches and legal issues in the investigation and prosecution of 
Internet-related child sexual exploitation cases. 

Speaker, Massachusetts Association of College and University Public Safety 
Directors 

AAG Sikellis spoke on the resources available to law enforcement 
agencies through the Attorney General's High Tech Crime Unit. 

Panelists, National Association of Attorneys General 



124 



AAG Murphy and Sergeant McLean spoke at a training sponsored by 
NAAG's "Internet Kiddie Pom Subcommittee." The training focused on 
investigating and prosecuting distributors of child pornography. 

Finally, members of the Unit assisted in drafting legislative proposals, including 
legislation to protect children from sexual predators on the Internet. Among other 
objectives, this legislation criminalizes the solicitation of a child for sexual conduct and 
the dissemination or receipt of information about a child to facilitate a sexual act. It also 
amends current obscenity and pornography laws to include computer images. 

OPERATION CLEAN SWEEP 

During the past year, the NSI Division continued with Operation "Clean Sweep." 
This initiative 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 neighborhoods. The operation, first initiated in the City of Waltham 
during the spring of 1995, has continued to be successful. 

During fiscal year 98, the NSI Division conducted a large-scale "Sweep" 
operation focusing on "designer drugs." These drugs include methamphetamine ("crystal 
meth"), methylenedioxy methamphetamine ("ecstasy") and ketamine (an animal 
tranquilizer), among others. This sweep, dubbed "Operation Rave," was launched in 
response to a serious escalation in the use of these drugs by teenagers and young adults, 
as well as recent deaths and overdoses attributed to these drugs. 

Following a lengthy investigation, over 30 individuals suspected of selling 
designer drugs were arrested. Most of these cases are still pending. Seized as a result of 
this investigation was a total of nearly five pounds of crystal methamphetamine, well 
over 1000 tablets of ecstasy and a large quantity of liquid and powdered ketamine, as well 
as a variety of other drugs. In addition, a notice of intent to file for forfeiture was sent to 
the owners of the Axis nightclub in Kenmore Square, warning them that forfeitiire 
proceedings would be instituted if immediate corrective measures were not taken. 
Numerous follow-up meetings were held during which the Division's Asset Forfeiture 
Unit met with the bar's owners to outline their responsibilities and the potential 
repercussions of noncompliance. 

In addition, following these investigations, members of the NSI Division met with 
administrators and students from area high schools and colleges to outline the dangers 
and offer further information on these drugs. 

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. The Division's Asset Forfeiture Unit works with the 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. 



125 



Of the numerous accomplishments this year in Operation Take Back, two will be 
highlighted here. The first involved a Weymouth drinking establishment. Following an 
investigation by State Police assigned to the NSl Division of reported drug dealing at this bar, 
three people were arrested, including a bartender, and a civil forfeiture action was filed against 
the bar and its owner. All three have since plead guilty. One of the defendants received a five 
year mandatory state prison sentence with three years supervised probation following his 
release; a second defendant received a two to three year state prison sentence. The final 
defendant received four years supervised probation. 

On the eve of trial, the bar's owner agreed to settlement terms proposed by the Unit. In 
addition to paying a $50,000 fine, the owner fiirther agreed that he would not, in any marmer, 
directly or indirectly, permit the keeping or sale of controlled substances in the bar. Pursuant 
to the terms of the settlement, a violation of this agreement will result in forfeiture of the bar. 

The second notable case involved a multi-unit apartment building located in the City of 
Worcester. Following an investigation which revealed that numerous tenants were regularly 
distributing narcotics fi-om their apartments, impacting on the quality of life of the surrounding 
community, the Asset Forfeiture Unit filed suit against the building's owner. 

In settlement of the suit, after consulting with local law enforcement officials and 
neighborhood activists, the owner agreed to pay a fine, make substantial improvements to the 
property and implement tenant monitoring, screening and eviction procedures proposed by the 
Asset Forfeiture Unit. 

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. 

One such training was conducted in Worcester and another at a statewide seminar for 
Secfion 8 Housing Administrators which focused on controlled drug dealing in Section 8 
apartments. The Asset Forfeiture Unit distributed manuals for use in conjunction with all its 
trainings. These manuals, which include discussions ranging fi-om proper tenant screening 
methods to the legal consequences for landlords who fail to evict drug-dealing tenants, have 
proven highly useful and popular. 

LAW ENFORCEMENT SUPPORT 

Assistant Attorneys General, State Police troopers and investigators assigned to the NSI 
Division also continued to work with and provide technical, legal and other forms of 
investigative support and assistance to numerous 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, district attorneys' offices, courthouse 
security personnel and various state and local police departments and task forces throughout the 
Commonwealth. These joint undertakings ranged from investigations of major money 
laundering organizations to bank robbery to death threats made to a Massachusetts judge. 



126 



An important Division focus continues to be the development of more effective 
approaches for addressing substance abuse among criminal offenders. Division staff assisted 
in drafting legislative proposals in this area and also participated in a number of substance 
abuse seminars with other system professionals. These have included significant 
participation in the Judiciary Subcommittee on Drug Courts and the Interbranch Drug 
Testing Policy Task Force and a number of programs aimed at early intervention for 
substance abusers. 

Members of the Division also participated in a number of training programs and 
speaking engagements in addition to those already summarized. The topics ranged from 
violence prevention to substance abuse and high risk youths. 

SUMMARY OF NSI DIVISION ACTIVITIES 

Among the general categories of crimes the NSI Division investigated and prosecuted 
during fiscal year 98, in addition to those investigated and prosecuted by the High 
Technology Crime Unit, were the following: weapons trafficking and related offenses, 
narcotics trafficking and related offenses, extortion, arson, money laundering, threats, 
prostitution, tax evasion, fraud, breaking and entering, larceny, receiving stolen property, 
gaming, and uttering. 

During FY 98, the NSI Division initiated 75 separate criminal cases. The Division 
also disposed of 88 separate criminal cases during the same time period. Of those, 75 were 
disposed of prior to trial and 15 after trial. Of the 15 jury trials, 13 resulted in convictions. 

Also during FY 98, the NSI Division's Asset Forfeiture Unit initiated 23 separate 
drug related civil forfeitures. The Unit disposed of 19 separate drug related civil forfeitures 
cases during the same time period. All of these cases were disposed of prior to trial. 

Finally, in addition to the "designer drugs" mentioned above, the NSI Division seized 
thousands of grams of cocaine, heroin and marijuana, as well as a large amount of illegally 
obtained prescription medication. 



127 



PUBLIC INTEGRITY DIVISION 

In fiscal year 1998, the Public Integrity Division (PID) continued to investigate and 
prosecute public corruption and conflict of interest cases throughout the Commonwealth. 
The Division consisted of five Assistant Attorneys General, several financial investigators 
and a team of Massachusetts State Police officers. 

During FY98, the Assistant Attorneys General assigned to the Public Integrity 
Division were Audrey Huang, John Grossman, Andrew Lawlor and Michael Zullas. Support 
staff included Susan Smith and Sheila Connolly. Jeremy Silverfine was the chief of the 
Division. Assisting the Division in several prosecutions this past year were Assistant 
Attorneys General Lori Balboni, Elisabeth Ditomassi, Frances Mclntyre, Mark Smith, and 
John Woodruff. The State Police who worked with the Public Integrity Division included: 
Steve Bennett, Walter Carlson, William Donoghue, Michael Federico, Marty Foley, Robert 
Friend, Bruce Hull, John Kelly, Dermot Moriarty, Matt D. Murphy, and Mary Sennott. The 
Financial Investigators were: Peter Darling, Patrick Ormond, and Paul Stewart. 

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 this fiscal year, the Public Integrity Division commenced approximately 
26 criminal prosecutions against public officials and other individuals who violated the 
public trust. During the same time period, over 28 criminal prosecutions were resolved. The 
criminal prosecutions that were initiated this past year ranged from crimes of larceny by 
police officers to case fixing committed by a Taunton Clerk-Magistrate to larceny of forfeited 
guns by a police captain. 

The Public Integrity Division 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 violating criminal tax laws of the 
Commonwealth. Public Integrity attorneys also assisted the Economics Crimes Division in 
the successful prosecution of a major fraud perpetrated on over 150 investors. 

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 also continues to work in conjunction with the Attorney General's 
Central Artery Tunnel (CAT) coordinator to monitor that project's adherence to the law. The 
Division continued to successfully work with state and federal law enforcement officials. 

I. Criminal Case Hig hli ghts 

A. Some Highlights of Cases Initiated in Fiscal Year 1998. 

• A Taunton police captain was indicted by a Bristol County Grand Jury on charges 
of larceny of a firearm and filing a false report in connection with his alleged theft of one or 
more guns from a gun buy-back program he administered, and interference with a witness in 
a case in which his nephew was charged with assault and battery. The City of Taunton, 



128 



Taunton CARES and Taunton Police had offered to buy back handguns, shotguns and rifles 
from citizens for $25 to $50 for each weapon in a program designed to take guns off the 
streets of Taunton. The poHce captain was responsible for turning the guns over to the State 
Police, who would then destroy them. At least one of the guns bought back through the 
program, a so-called Saturday Night Special, was allegedly stolen by the captain. (AAGs 
Jeremy Silverfme, John Grossman). , 

The captain was also charged with interfering with a witness and obstruction of 
justice for allegedly having an assault and battery with a dangerous weapon charge against 
his nephew dropped without a hearing. The captain was charged with soliciting and 
accepting an illegal gratuity for allegedly threatening to use his police power against a bar 
unless the owners gave him free alcohol and a baseball jacket. 
< / 

Also indicted with the Taunton police captain was a former Clerk Magistrate in 
Taunton District Court. He was charged with interfering with a witness, obstruction of 
justice and filing a false written report. The pharges are all in connection with allegations 
that he worked in concert with the Taunton police captain to have the assault and battery with 
a dangerous weapon charge against the Captain's nephew dismissed. 

• The former assistant clerk ma_gi^trate in Taimton District Court was also indicted 
on one covmt of perjury for testifying falsely in July 1996 at a hearing of the Supreme 
Judicial Court's Committee on Professional Responsibility for Clerks of Courts. The 
Committee was investigating allegations of misconduct by the defendant. (AAGs Jeremy 
Silverfine, John Grossman). 

• A West Roxbury man was indicted on charges he attempted to attack a judge 
during a court hearing in which the man's cousin was being sentenced to 20 years in prison. 
He was charged with assault on a Superior Court judge, disrupting court proceedings and 
resisting arrest. 

The charges arose after the defendant attended his cousin's sentencing for unrelated 
charges on January 7, 1998. Soon after the judge sentenced the defendant's cousin to 20 
years in state prison, the defendant stormed out of the courtroom, yelling profanities. The 
defendant then re-entered the courti;oom seconds later through a private door near the judge's 
bench and began lunging towards the judge but was intercepted before reaching the judge by 
courtroom officers. He then struggled with the court officers and resisted their attempts to 
handcuff him. 
(AAGs Audrey Huang, Michael Zullas). 

• Two former Boston Public Health commission officials were indicted for allegedly 
stealing more than $1 70,000 and filing false state income tax returns. A Suffolk County 
Special Grand Jury indicted a Braintree man with three counts of larceny, one count of 
conflict-of-interest, three coimts of submitting false claims, one coimt of procurement fraud, 
and three counts of filing false tax returns. The other defendant, of Boston, was indicted on 
two counts of larceny, three counts of submitting false claims, one count of procurement 
fraud and two counts of filing false tax returns. One defendant is the former director of the 
Health Commission's South Block facility, an apartment complex that historically has served 
as a home for many of Boston City Hospital's and Boston Medical Center's doctors, nurses 
and medical students. The other defendant is a former Recreation Director at South Block. 



129 



Two indictments allege that the former officials embezzled about $50,000 between 
1992 and 1997 by pocketing fees paid by residents and others to swim or receive swimming 
lessons at South Block's pool. Larceny, procurement fraud and false claims indictments 
allege the former officials stole additional money under a scheme fi-om 1994 to 1997 in 
which they set up a dummy company to clean the South Block facility for $50,000 a year, but 
used Public Health Commission supplies and employees to perform much of the actual 
cleaning. As a result of the cleaning contract scheme, the former director is also charged 
with one count of conflict-of-interest for allegedly awarding the cleaning contract bid to his 
straw company and then authorizing Public Health to pay the straw company's monthly 
$4,200 bills for cleaning services. 

The Grand Jury further returned a third larceny indictment against the former director 
for allegedly stealing money and labor fi^om the Public Health Commission to help renovate 
and maintain his home. Under this alleged third scheme, the former director approved Public 
Health's payment of invoices for building supplies and major appliances used in the 
renovation of his personal residence. The former director also allegedly directed Public 
Health Commission employees to perform painting and maintenance work on his home 
during city time. 

The Grand Jury also indicted the two men with filing false income tax returns for 
allegedly filing state income tax returns that omitted the money they received fi-om the 
cleaning contract and swimming lessons. (AAG Andrew Lawlor). 

• Seven bail magistrates in district courts throughout the eastern Massachusetts area 
were indicted on a number of tax charges that they failed to declare a total of $580,000 in 
fees they took fi-om unarraigned defendants between 1991 and 1996. 

As a result of the alleged failure to declare the income, the state subsequently lost 
$34,000 in tax revenue. The seven, who work in courts in Dedham, Leominster, Wobum, 
Barnstable, Boston and Salem, have all been charged with a variety of criminal tax charges, 
including filing false tax returns and tax evasion. 

Bail magistrates are district court clerk-magistrates, assistant clerk-magistrates or bail 
commissioners, or non-state employees, who are appointed by a panel of Superior Court 
judges. In exchange for a $25 fee fi-om each bailee, the magistrates set bail on people who 
are arrested when district courts are not open for business. The $25 fees are taxable income. 
The magistrates were charged with inaccurately and untruthfully reporting the income they 
derived fi-om the positions. (AAG John Grossman). 

• A Medford contractor and a salesman for a minority-owned Dorchester company 
were indicted on charges they schemed to mislead state officials about minority participation 
in a state construction project. 

The former owner of Morello Construction Company was charged with procurement 
fi-aud, making a false claim to the state and falsifying corporate books, in connection with a 
1992 state contract to rehabilitate Heritage State Part in Turner's Falls. He was charged with 
conspiring with a salesman for Supplies Exchange Systems, a minority-owned Dorchester 
company, in connection with the scheme. 



130 



In 1992, the contractor's company was awarded a contract worth more than $1 
million to refurbish the park. The contract required the contractor to hire a minority 
subcontractor ~ Supplies Exchange Systems ~ to supply building materials and perform 10 
percent, or about $1 19,000 worth of the work. According to the indictments, Supplies 
Exchange Systems did not perform any construction work on the contract and supplied no 
construction materials. Nearly a year after work began on the contract, the contractor 
allegedly submitted documents, with the assistance of the salesman, falsely showing that 
Supplies Exchange had provided materials for the project. In exchange for the salesman's 
help, Supplies Exchange was allegedly paid at least $4,000 by the contractor. (AAG Michael 
Zullas). 

• A Wobum police detective, head of the department's drug unit for more than 20 
years, was indicted for stealing a Chevy S-10 Blazer used as an undercover vehicle by the 
city by allegedly forging the name of the police chief on the car's assignment of title. The 
detective later recovered money from an insurance company for damages to the vehicle, then 
sold the truck for a profit. The Detective was also charged with larceny over $250, fraud and 
false claims based on allegations that he submitted phony documents to be paid overtime for 
court appearances that he did not attend and for reimbursement for expenses that he did not 
pay. The indictments allege a pattern of theft from the city over several years. 

The indictments also charge that the Detective "double-dipped" by seeking and 
receiving from the city expense accounts reimbursements from expenses he allegedly never 
accrued. The total value of the thefts exceeds $6,000. (AAG Michael Zullas). 

• A Brockton police officer was indicted on six separate charges of armed robbery. 
The robberies are alleged to have occurred in Boston and Brockton. The officer, an eight- 
year veteran, was indicted on six counts of armed robbery, and seven coimts of burglary and 
civil violations. 

The indictments allege that the officer used his position as a police officer to gain 
access into six residences in Boston and Brockton. He allegedly represented himself to be a 
police officer carrying out a valid search warrant usually late at night to gain access to the 
particular residence. Once entry was granted, he would handcuff various victims and search 
the property for cash or jewelry. The indictments also allege that he also broke into an 
unoccupied apartment in Brockton to steal money. 

The total value of property stolen pursuant to this investigation allegedly exceeds 
$10,000. (AAGs Mark Smith, Michael Zullas). 

• A former Westport Police Department Chief of Detectives was indicted on larceny 
charges for stealing over $5,100. The Westport man was indicted by a Fall River Grand Jury 
on two counts of larceny. The first larceny charge alleges that, in his capacity as the 
President of the D.A.R.E. of Westport Inc., he embezzled $4,041.90 from the non-profit 
corporation in August, 1995. The Corporation was founded by him in 1989 to develop and 
implement substance abuse education programs. 

The second larceny charge stems from an allegation that the former detective 
submitted a false request for reimbursement to the Town of Westport in December 1995. 
Allegedly, he requested a $1,181.33 reimbursement from the town for three electronic 



131 



components he purportedly purchased for the town's version of the DARE Program. The 
equipment, allegedly, was actually used by him as part of a surround-sound entertainment 
center in his home. 
(AAG Andrew Lawlor). 

B. Some Highlights of Case Dispositions in Fiscal Year 1998. 

• A former Middlesex Superior Court Clerk Magistrate was sentenced to two years 
in state prison for accepting more than $10,000 in bribes and vacations from a private 
investigator in return for fiinneling taxpayer-funded defense work to the investigator. As part 
of the sentence, the Court additionally ordered that the former Clerk Magistrate could never 
hold a position with any local, state or federal government agency upon his release from 
prison. (AAGs Andrew Lawlor, Mark Smith). 

As clerk magistrate for the "first session" since April 1994, the Arlington man 
determined defense counsel assignments in criminal cases. In exchange for more than $6,000 
in bribes and more than $4,000 worth of Florida and Hawaii vacations from the private 
investigator, the defendant routinely assigned the criminal cases of indigent defendants to a 
handftil of attorneys who regularly hired the investigator to help them. 

The private investigator with whom the clerk magistrate was involved, kicked back 
some profits from the work, making six monthly $1,000 payments to the clerk magistrate in 
1995 through a third party to avoid detection, paying for the clerk magistrate's vacation 
airfare, and giving him free use of condominiums the private investigator owned in Florida 
and Hawaii. 

The private investigator also shared with the clerk magistrate cash that the private 
investigator skimmed from a video store business he owned in Florida. 

The clerk magistrate, who had worked at the Cambridge court for 34 years until his 
dismissal, largely ignored the duty attorney system for assigning counsel to represent 
indigent defendants. 

During 1994-1995, when 62 attorneys were approved to receive public defender 
assignments in criminal cases at Middlesex Superior Court, more than one-third of the 
appointments made by this former clerk magistrate were awarded to four attorneys who 
exclusively or primarily used the private investigator. The clerk magistrate then approved 
hundreds of motions filed by those four attorneys so that they could hire this particular 
private investigator. 

• The private investigator, formerly of Hampton, NH, was found guilty after a 
lengthy trial on charges of overbilling the state public defender's agency. He was sentenced 
to 1 8 to 20 years in state prison. He also plead guilty to charges that he bribed the clerk 
magistrate. He received a four-and-a-half-year state prison sentence on the bribery charges 
that will run concurrently with this 18-20 year term. The private investigator had billed the 
Commonwealth $565,000 for purported investigative services in fiscal years 1994, 1995, and 
1996. He was convicted on procurement fraud charges for allegedly inflating bills claiming 
that he worked 5,340 hours in fiscal year 1994 and more than 10,000 hours in fiscal year 
1995. (AAGs Andrew Lawlor, Mark Smith). 



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The clerk magistrate also plead guilty to charges stemming from his association with 
the private investigator in Four Star Video, in Dania, Florida during the bribery scheme. The 
clerk magistrate hid this financial relationship with the private investigator and the video 
store by failing to disclose it to the State Ethics Commission, and failing to report the 
monthly payments and vacation gifts from the private investigator. 

• An employee of the video store was also convicted in this scheme on one count of 
perjury. She was sentenced to serve two-and-a-half years in jail and pay a $1,000 fine. 
(AAGs Andrew Lawlor, Elisabeth Ditomassi). Another Middlesex County assistant clerk 
magistrate was indicted in December, 1997, on two counts of accepting illegal gratuities from 
both the private investigator and the clerk magistrate. (AAG Andrew Lawlor). The private 
investigator's wife plead guilty in December to a charge of failing to file a tax return. 
(AAG Andrew Lawlor). 

• A Fall River attorney was sentenced to two-and-a-half years in state prison after he 
was convicted of charges of attempting to pay off witnesses, including an alleged rape victim, 
in exchange for their agreement not to testily against his clients in criminal cases. The 
attorney was sentenced to two-in-a-half years in state prison, committed, following his 
conviction after a two-week trial on two counts each of bribery and interfering with a 
witness. Also sentenced to two-and-a-half years was the attorney's driver and personal 
assistant on one charge each of bribery and interfering with a witness. 

The charges arose after two incidents involving the attorney's clients were brought to 
the attention of the Attorney General's Office. In May 1995, the attorney and his driver 
attempted to pay a victim $1,500 in exchange for recanting her allegations against one of the 
attorney's clients charged with rape. The victim reported the attempted payoff to authorities. 

From August to September of 1995, the attorney made payments of $500 to another 
victim in exchange for her not appearing as a witness in an armed robbery case against 
another of the attorney's clients. That defendant plead guilty to reduced charges after the 
victim failed to appear in court. (AAGs Michael ZuUas, Frances Mclntyre). 

• A former clerk with the Department of Employment and Training (DET) plead 
guilty on charges he stole almost $12,000 in unemployment benefits, much of it while he was 
working at the DET. 

The Methuen man plead guilty in Suffolk Superior Court on two charges of larceny 
over $250, one count of larceny under $250, and three counts of unemployment fraud. The 
court sentenced the defendant to two-and-a-half years in the House of Correction, suspended 
for three years, during which time he will be on probation. He was also ordered to pay 
$1 1,818 restitution. The Methuen man worked as an Intermittent Claims Clerk for the DET 
in their Roxbury office in 1991 and 1992. In July 1993, a complaint was issued in Boston 
Municipal Court alleging he had collected unemployment benefits while working for the 
DET. He was scheduled to be arraigned in September, 1993, but allegedly failed to appear in 
court until May 28, 1997. 

While on default, the defendant continued to collect unemployment benefits on two 
different occasions leading to two additional larceny and unemployment fraud charges. All 



133 



together, he took $1 1,818 in fraudulent unemployment benefits. (AAGs John Grossman, 
Elisabeth Ditomassi). 

• Two Division of Medical Assistance (DMA) employees plead guilty to charges 
they used $27,000 in Medicaid money to get cocaine from phony Medicaid beneficiaries. 
The employees also plead guilty to one count each of presentation of a false claim. 

Two Medicaid recipients also plead guilty to one count of larceny over $250, based 
on a continuing scheme to defraud Medicaid. 

The DMA employees had served as financial assistance social workers for more than 
10 years and were responsible for reviewing and approving individual applications for 
Medicaid assistance. They authorized Medicaid payments to beneficiaries, who would then 
provide the DMA employees with cocaine. The scheme began in the fall of 1996 and 
continued until last summer, when the Office of the Attorney General and the State Police 
stepped in to stop the alleged cocaine ring. 

One DMA employee was sentenced to two-and-a-half years in the House of 
Correction, with 90 days to be served. The remainder was suspended for three years, during 
which time the defendant will be on probation. He was also ordered to pay full restitution. 
One of the recipients was sentenced to five years of probation and ordered to pay $14,840 
restitution to the state. The other recipient was sentenced to two years in the House of 
Correction, four months to be served and the balance suspended for two years, plus 
restitution of $15,1 10. (AAGs Elisabeth Ditomassi, Audrey Huang). 

• A Springfield woman plead guilty to charges she participated in a scheme in the 
early 1 990s to steal $40,000 from the state Department of Social Services. 

The woman, who was originally from Dorchester and currently fi"om Springfield, 
plead guilty to 1 8 counts of larceny over $250 and two counts of larceny under $250. She 
was sentenced to a suspended two-year House of Correcfion sentence, with four years of 
probation. She was also ordered to pay $1 1,000. 

The defendant worked the scheme with a DSS employee who was responsible for 
processing re-applications for subsidies for providers and guardians of children placed for 
adoption. The two individuals stole more than $40,000 from DSS, by sending monthly 
subsidy checks to co-conspirators. (AAG Andrew Lawlor). 

• A Dorchester District Court procedures clerk plead guilty to charges she collected 
more than $52,000 in welfare benefits while at both the Dorchester and Waltham District 
Courts. 

The Dorchester woman plead guilty in Suffolk Superior Court to one count of larceny 
by false pretenses and one count of welfare fraud. She received welfare benefits from 
September 1990 until December 1996 after misrepresenting her employment status to 
Department of Transitional Assistance social workers. In 1996, the Department of 
Transitional Assistance terminated her benefits. (AAG Andrew Lawlor). 



134 



• A former middle school principal in Melrose plead guilty to a charge of filing a 
false tax return. 

In a complaint issued in Middlesex District Court, the Melrose principal was charged 
with willfully making and signing a 1992 Massachusetts resident income tax return under the 
penalties of perjury, knowing that some of the information in the return was incorrect. The 
principal failed to report $10,000 in income. 

Immediately after the issuance of the complaint, the defendant plead guilty. The 
Court sentenced the defendant to three years probation, ordered the defendant to immediately 
pay $1 5,000 in fines and serve 300 hours of community service. (AAG Elisabeth Ditomassi). 

• A veteran 1 2-year Framingham poiice officer plead guilty to stealing more than 
$13,000 fi^om his own police imion to pay for personal items and his mortgage. The 
defendant was treasurer of the union. Specifically, he plead guilty to one count of larceny 
over $250, two coimts of forgery and two counts of uttering. The officer was sentenced to a 
year in the House of Correction, suspended for one year, during which time he will be on 
probation. He was also ordered to pay almost $2,500 in fines, restitution and penalties. 
(AAG Jeremy Silverfine). 

Public Charges and Indictments 

Date Defendant's Name 

7/97 Francis D. Noone (AAGs Mark Smith, Michael Zullas). 

6 counts of armed robbery (while masked) 

6 counts of assault with intent to rob 

1 count of entry to a dwelling house with intent to commit a felony 

1 count of breaking and entering in the daytime 

5 counts of breaking and entering in the nighttime 

7 counts of larceny 

7 counts of civil rights violations 

2 counts of conspiracy to commit armed robbery 

7/97 Gerardo Rosario. Jr. (AAGs Mark Smith, Michael ZuIIas). 

6 coimts of armed robbery 

6 counts of assault with intent to rob with a dangerous weapon 
1 count of entry into a dwelling with intent to commit a felony 

1 count of breaking and entering in the daytime 

5 counts of breaking and entering in the nighttime 

7 counts of larceny 

7 counts of civil rights violations 

2 counts of conspiracy 

7/97 Howard J. Tillman (AAG Elisabeth Ditomassi). 

1 count of larceny over $250 
1 count of a false claim 

7/97 Thomas P. Welch (AAG Elisabeth Ditomassi). 



135 



1 count of larceny over $250 
1 count of a false claim 

7/97 Daniel Athas (AAGs Elisabeth Ditomassi, Audrey Huang). 

1 count of larceny over $250 

7/97 Steven Fitzgerald (AAG Elisabeth Ditomassi). 

1 count of larceny over $250 

7/97 Pamela Foye (AAG Andrew Lawlor). 

1 count of larceny over $250 
1 count of welfare fraud 



Public Charges and Indictments 

Date Defendant's Name 

9/97 Paul Nicoli (AAG Jeremy Silverfme). 

1 count of larceny 

2 counts of forgery 
2 counts of uttering 

9/97 Mario Lewis (AAG Andrew Lawlor). 

2 counts of larceny over $250 

9/97 Jean Patrick Voltaire (AAGs John Grossman, Elisabeth Ditomassi). 

2 charges of larceny over $250 
1 count of larceny under $250 

3 counts of unemployment fraud 

10/97 Paul A. LoConte (AAG John Grossman). 

6 counts of tax evasion and filing a tax return 

10/97 Gerald Surette (AAG John Grossman). 

5 counts of tax evasion 

5 counts of filing a false tax return 
1 count of failure to file 

10/97 John L. Kowalski (AAG John Grossman). 

4 counts of filing a false tax return 

10/97 Ruthanne Famsworth (AAG John Grossman). 

6 counts of tax evasion 

6 counts of filing false tax returns 

10/97 Joseph L. McCarthy (AAG John Grossman). 

6 counts of tax evasion 
6 counts of filing a false tax return 



136 



10/97 Patrick Toshach (AAG John Grossman). 

4 counts of tax evasion 

10/97 Raymond R. Blanchard (AAG John Grossman). 

6 counts of tax evasion 
6 counts of filing a false return 



Public Charges and Indictmtnts 

Date DefendaLt's Name 

12/97 John Coltcn (AAGs John Grossman. Jeremy Silverfine). 

1 count inte:fering with a witness 
1 count of obstruction of justice 
1 count of filing a false written report 
1 count of perjury 

12/97 Richard Piaental (AAGs John Grossman, Jeremy Silverfine). 

1 count of larceny of a firearm 
1 count of filing a false written report 
1 count of int'jrfering with a witness 
1 covmt of accepting an illegal gratuity 

1 count of obstaiction of justice 

12/97 Robert Shell (AAG Andrew Lawlor). 

2 count? of acceping illegal gratuities 

2/98 Brian Kelly (AAGs Audrey Huang, Michael Zullas). 

1 count of assault o» a public employee 
1 count of disrupting court proceedings 
1 count of resisting airest 

3/98 WilKam Jewer (AAG Michael Zullas). 

1 count of larceny of a motor vehicle 
1 count of larceny ovei $250 
1 count of fi-aud in motcr vehicle insurance claim 
1 coant of false claims 
1 count of false statement in title application 
1 count of fi-aud by city cfficer 
1 count of forgery of assignment of title 
1 coont of false written statement 

3/98 Gaetano Morello (A\G Michael Zullas). 

1 count of procuremeit fi-aud 
1 :ount of making a filse claim 
] count of false entrie in record 
L count of conspiracy 



3/98 David Lee (AAG Michael Zullas). 

1 count of conspiracy 

Public Charges and Indictments 

Date Defendant's Name 

5/98 Wanda Estes (AAG Audrey Huang). 

1 count of larceny over $250 
1 count of making false representatif c . 

6/98 Joseph Rotondi (AAG Andrew L? v, ' or). 

3 counts of larceny 
1 count of conflict of interest 
3 counts of submitting false clair u 

1 count of procurement fraud / 
3 counts of filing false tax retun;S 

6/98 Stephen P. Sirabella (AAG Andrew Lawlor). 

2 counts of larceny 

3 counts of submitting false claias 

1 count of procurement fraud 

2 counts of filing false tax retur 6 

Case Convictions/Dispositions 

Date Defendant's Name / 

7/97 James M. June (AAGs Mx' ael Zulla , John Woodruff), 

plead guilty to 2 count of X ing illegal gratuities 
sentenced to 2 years in tbii ouse of Co n-ction, 1 year committed, 
balance suspended for 2 y/ Js, and prob. •ti on 
to run concurrent with f x; ting larceny c b -ge 

7/97 Constantine J. Vaka }( VAGs Michael ix'Uas, John Woodruff), 

found not guilty of 2 ccants of accepting \ egal gratuities 

8/97 Anthonv LaRosa (A V ' Elisabeth Diton.i! si). 

plead guilty to 1 counDf filing false inco i- tax return 

3 years probation, a S )' 000 fine and 300 c 'irs of community service 

8/97 Tatnuck Square G ef y d/b/a Nassif Ent a prises (AAGs Elisabeth 

Ditomassi, Lori Balbi ni i 

found guilty of 1 cour.t O' 'arceny over $2: (• and 1 count of 
presentation of a false clii n fined a total o '!3 1,250 

Case Convictions/Dispositions 



138 



Date Defendant's Name 

8/97 Jihad E. Nassif (AAGs Elisabeth Ditomassi. Lori Balboni). 

found not guilty on 1 count of conspiracy to commit larceny 

8/97 Marline Geara (AAGs Elisabeth Ditomassi, Lori Balboni). 

found not guilty of conspiracy to cormnit larceny 

9/97 Linda Rentz (AAGs Andrew Lawlor, Elisabeth Ditomassi). 

found guilty of 1 count of perjury 

sentenced to serve 2'/2 years committed in the House of Correction 
and pay a $1,000 fine 

9/97 Norma Ortega-Canerv (AAG Michael Zullas). 

placed on pretrial probation on 1 count of conspiracy to commit 
larceny 

9/97 Pamela Fove (AAG Andrew Lawlor). 

plead guilty to 1 count of larceny by false pretenses and 1 count of 
welfare fraud 

sentenced to 1 year in the House of Correction, 6 months to serve, 
balance suspended for 3 years, and $52,412 restitution 

10/97 Norman Carignan (AAG Elisabeth Ditomassi). 

plead guilty to 1 count of larceny over $250 and 1 count of 
presentation of a false claim sentenced to 1 year probation, a fine of 
$1,250, and $2,164 restitution 

10/97 Times Square Farmers Market. Inc. (AAG Elisabeth Ditomassi). 

plead guilty to 1 count of larceny over $250 and 1 count of 
presentation of a false claim fined $1,250 

11/97 Lionel Torres (AAGs Michael Zullas, Jeremy Silverfine). 

plead to assault and battery by means of a dangerous weapon 
sentenced to a 2'/2 year House of Correction sentence, one year 
committed, the balance suspended for 2 years, probation 

12/97 Ruth Carroll (AAGs John Grossman, Jeremy Silverfine). 

foun^ guilty of 1 count of larceny over $250, 1 count of welfare fraud 
and 1 count of paying an illegal gratuity 

sentenced to 3 years probation and ordered to pay $9,000 

Case Convictions/Dispositions 

Date Defendant's Name , 

10/97 James O. Mills (AAGs Andrew Lawlor, Mark Smith). 

(1) found guilty of 19 charges of larceny, procurement fraud, pension 
fraud, failing to file a state tax return and perjury 



139 



sentenced to 1 8-20 years committed to state prison 

12/97 (2) plead guilty to charges of bribery 

sentenced to a 4'/2-5 year committed to state prison 

12/97 Edward K. Boyer (AAGs Michael Zullas, Frances Mclntyre). 

found guilty of 2 counts of bribery and 2 counts of interfering with a 
witness sentenced to 2'/2 years committed in the House of Correction, 
$1,000 fine 

12/97 Pedro Cumba (AAGs Michael Zullas, Frances Mclntyre). 

found guilty of 1 count of bribery and 1 count of interfering with a 
witness sentenced to IVi years committed to the House of Correction, 
$1,000 fine 

12/97 Elizabeth C. Mills (AAG Andrew Lawlor). 

plead guilty to 1 count of failure to file tax return 
fined $500 

1/98 Jean Patrick Voltaire (AAGs John Grossman, Elisabeth Ditomassi). 

plead guilty to 2 charges of larceny over $250, 1 count of larceny 
under $250 and 3 counts of unemployment fraud sentenced to 2'/2 
years in the House of Correction, suspended for 3 years, 
probation, ordered to pay $11,8 18 restitution 

1/98 Howard J. Tillman (AAG Elisabeth Ditomassi). 

plead guilty to 1 count of larceny over $250, and 1 count of 
presentation of a false claim sentenced to 2'/2 years in the House of 
Correction with 90 days of that to be served, the remainder suspended 
for 3 years probation, also ordered to pay full restitution of $27,000 

Case Convictions/Dispositions 

Date Defendant's Name 

1/98 Joseph M. Marshall (AAGs Andrew Lawlor, Mark Smith) 

plead guilty to 1 count of bribery, 1 count of unlawfiil gratuity, 1 count 
of conflict of interest, 1 count of conspiracy and 2 counts of filing false 
statements of financial interest sentenced to 2 years in state prison 
ordered that defendant never hold a position with any local, state or 
federal government agency once released fi^om prison 

1/98 Steven Fitzgerald (AAGs Elisabeth Ditomassi) 

plead guilty to 1 count of larceny over $250 sentenced to 5 years of 
probation and ordered to pay $14,840 restitution 

1/98 Martin Saulen (conflict case) (AAG John Grossman) 

admitted to sufficient facts to knowingly being present where heroin is 
stored and received continued without a finding for one year 



140 



4/98 Catherine Guerrier (AAG Andrew Lawlor) 

plead guilty to 18 counts of larceny over $250 and 2 counts of larceny 
under $250 sentenced to a 2 year House of Correction sentence 
suspended with 4 years of probation, and ordered to pay $1 1,000 in 
restitution 

4/98 Daniel Athas (AAGs Audrey Huang, Elisabeth Ditomassi) 

plead guilty to 1 count of larceny over $250 sentenced to 2 years in the 
House of Correction, 4 months to be served, balance of jail time 
suspended for a 2 year period, full restitution in the amount of 
$15,1 10, and required participation in drug and alcohol treatment 

5/98 Paul Nicoli (AAG Jeremy Silverfme) 

plead guilty to 1 count of larceny over $250, 2 counts of forgery and 2 
counts of uttering sentenced to 1 year in the House of Correction 
suspended for 1 year, during which time he will be on probation and 
ordered to pay nearly $2,500 in fines, restitution and penalties 

Case Convictions/Dispositions 

Date Defendant's Name 

6/98 Thomas Welch (AAG Elisabeth Ditomassi) 

plead guilty to 1 count of larceny over $250 and 1 count of 
presentation of a false claim sentenced to 5 years probation, and 
$3,000 restitution on both counts 

6/98 John Andrew (conflict case) (AAG John Grossman) 

found guilty of 2 counts of possession of heroin and 1 count of 
resisting arrest sentenced to 3 months committed to the House of 
Correction, 2 years probation on and after incarceration, and drug court 

6/98 Wanda Estes (AAG Audrey Huang) 

plead guilty to presentation of a false claim and larceny over $250 
sentenced to 2 years in the House of Correction, sentence suspended 
for 5 years, ordered to pay $21,679 in restitution and 300 hours of 
community service 



141 



SAFE NEIGHBORHOOD INITIATIVE 

Established in February, 1993, by the Attorney General's office, the Suffolk County 
District Attorney's Office, the Mayor's Office of the City of Boston and the Boston Police 
Department, the Safe Neighborhood Initiative (SNI) celebrated its fifth anniversary in 
February of 1998. Successful SNI models have been established in Dorchester, Grove Hall, 
Brockton, Chelsea and Uphams Comer. The city of Taunton continued to establish its own 
Safe Neighborhood Initiative model— Taunton Care5~and the Turners Falls Village of 
Montague officially began an SNI in June. 

The SNI has developed into a truly effective coalition among community residents, 
state and local government officials, law enforcement personnel and human service providers 
to solve a variety of community problems. Based on the premise that no one group can solve 
all the problems faced by urban neighborhoods, the SNI model works to stem violence and 
improve the quality of life by developing multi-disciplinary approaches to community issues. 

Since those who live in a community know best what problems face the neighborhood 
and how they can be addressed, residents are critical members of SNI partnerships which 
revolve around the core principles of coordinated law enforcement, prevention, intervention 
and treatment and neighborhood revitalization. The richness of the SNI comes from the fact 
that the program components and the individuals involved with them have collaborated in 
numerous ways, existing not as discrete entities but as vital pieces of the big picture of 
community health and safety. Thus, our projects often overlap in ways that significantly 
enhance the SNFs ability to respond to community need. 

Through a process of awarding SNI Innovation grants to ten cities across the state and 
through a Southeast Regional SNI Conference on how to build an SNI that drew more than 
1 80 people, we have continued to encourage more and more cities to adopt SNI-type 
partnerships to address community problems. 

While we worked to nurture new SNI efforts across the Commonwealth, the more 
mature projects continued to grow and flourish during fiscal year 1998. Our model project in 
Dorchester continues to be led by zealous community leaders who put forth heroic efforts to 
sustain the peace and well-being of the SNI target area and its residents. Our Grove Hall 
project has gone through a process of cementing many relationships between community 
partners and law enforcement that had been tenuous in the past and moved forward to enjoy a 
great deal of success in reaching more community residents and addressing pressing issues in 
that community. The Uphams Comer SNI continued to be a law enforcement driven project 
that was rewarded with record decreases in crime during this fiscal year. The SNI project in 
Brockton received its first major infusion of funding with a four-year Byme grant fi-om the 
Executive Office of Public Safety. Initiated in early 1996, the Taunton SNI made major 
strides in solidilying the partnership led by human service providers to address crime and 
quality of life issue in that city. Our newest SNI effort in Montague was quickly developing 
its stmcture and focus areas as SNI Prosecutor Linda DelCastilho assumed her duties there 
late in the year. 

State-Wide Expansion Efforts 



142 



In an effort to stimulate even further state-wide expansion of the SNI model, the 
Attorney General committed this year to provide SNI Innovation grants to ten cities across 
the Commonwealth: Taunton, New Bedford, Fall River, Lowell, Maiden, Somerville, 
Lawrence, South Boston, Springfield, and Pittsfield. Nine cities have been awarded grants, 
thus far. 

The Attorney General's commitment to youth issues prompted the decision to focus 
the Innovation grants on the needs of yoimg people. Agencies in each of the selected cities 
were asked to develop concept papers detailing how they would creatively utilize funds to 
provide prevention, intervention and/or treatment services for young people in their 
commimities. 

One of the first to receive an Innovation grant, the Taunton Department of Human 
Services, is utilizing funding to provide random drug testing and electronic monitoring for 
offenders at Taunton Juvenile Court, as well as providing Spanish language courses for 
police officers. Since its inception in February, 49 drug screens have been completed for 23 
juveniles. 

Extending the closing time of the YMCA of Southeastern Massachusetts' Kids Center 
until 9:00 p.m. one night per week is the focus of New Bedford's Innovation grant. This will 
allow the YMCA to serve an additional 120 youth fi-om the Weld Square area of that city 
with multi-cultirral activities and community service opportimities. 

Big Brother/Big Sister of Greater Lowell will similarly utilize its grant to extend the 
hours of their "ADAM Project." This program engages at-risk young men in training on life 
skills, violence prevention and leadership development including Outward Boimd excursions. 

Fall River's Innovation Grant was awarded to the YMCA of Greater Fall River to 
initiate the "Streetwise Players," a 25-member teen performing arts troupe that will write and 
perform plays about teen substance use. Followed by teen-developed discussion activities, 
the plays will be presented to 1 ,000 sixth through eight grade students in Fall River. In 
addition to being involved in performances, the Streetwise Players will undertake a 
community -wide education campaign involving the distribution of 250 posters and 30,000 
flyers and two radio and two television broadcasts of their performances. 

Holy Family Hospital in Lawrence developed a program to address the issue of 
adolescent dating violence with students at Lawrence High School. Both male and female 
students will learn the warning signs of an abusive relationship, various types of abusive 
behavior, and the effects on children who witness domestic violence. Students will 
ultimately produce some sort of performance, display or presentation to disseminate what 
they have learned about dating violence. 

Young women fi-om the Newland Street and Linden Public Housing Developments in 
Maiden are the targets of the Maiden YMCA Innovation grant. These women will be 
involved in a peer intervention program combining peer leadership, adventure-based 
activities, and art-based learning experiences to foster self-expression, self-esteem, trust, 
communication, and problem-solving skills. 



143 



Springfield's South End Community Center is utilizing their Innovation grant to 
double the capacity of their Community Access Project and train young people to become 
community leaders. The community center has a three-year plan to develop after school 
programming and expand their "safe passage" zone which is a coordinated law enforcement 
effort to create a safe, crime-free area through which residents can go to work and school. 

One hundred young people will be employed with Innovation grant funding awarded 
to the South Boston Neighborhood House for their "Rent-a-Kid" youth worker program. In 
addition to employment opportunities, the program will also provide the young people with 
weekly counseling sessions around issues such as suicide, grief, substance abuse, conflict 
resolution and stress management. 

Youth in Somerville's Mystic Public Housing Development will have the opportunity 
to operate the "Teen Choice Club." The recent suicide of a young man in the development 
prompted youth to speak up about the lack of productive after school activities in the area. 
As a result, the Innovative grant was awarded to help and develop the club which will 
provide recreational, educational, leadership development, and self esteem-enhancing 
activities for youth in this development. 

In total, the SNI Innovation grants will assist more than 550 young people across the 
Commonwealth. 

Accomplishments under SNI Core Components 

Prevention, Intervention and Treatment 

SNI Jobs for Youth Program 

One of the major efforts aimed at prevention and intervention is our Safe 
Neighborhood Initiative Jobs for Youth Program. Begun in 1996, the program has grovm 
from employing 23 youth in five communities to employing more than 1 00 young people in 
1 1 communities across the Commonwealth. 

Eighteen youth from SNI target areas in Grove Hall, Fields Comer and Uphams 
Comer are employed through Boston Community Centers (BCC). Partnering with local 
businesses and agencies, BCC places young people in a variety of capacities allowing them 
to leam a variety of skills including entrepreneurship, leadership and civic duty. Additional 
workshops offer information on professional grooming, resume development, conflict 
resolution, the law, and HIV/ AIDS and general health issues. The program not only offers 
youth an invaluable experience but also allows local employers to benefit from the presence 
of a young worker. Work sites employing SNI Jobs for Youth participcints are reporting 
increased production in their daily operations. 

The Old Colony YMCA in Brockton funds seven young people in sites throughout 
the Brockton area for their SNI Jobs for Youth program. In addition to being employed, 
young people get involved in planning and organizing community events including the Ninth 
Aimual Youth Conference in March, a Girls Conference in May, conflict mediation 
workshops and "cookie bakes" at a residential program for the city's elderly. Teens also 
served as junior staff at Camp Massasoit which served 300 Brockton SNI youth during the 
summer. 



144 



Chelsea, through the city's Department of Health and Human Services, provides 
positions for fifteen Chelsea teens in positions including Chelsea Cable TV, the Chelsea 
YMCA, Chelsea City Hall, the Chelsea Public Library, Evelyn's Hair Design, the Chelsea 
Human Services Collaboration, and Chelsea Neighborhood Housing Services. SNI Jobs for 
Youth program participants also receive instruction on writing resumes, career exploration, 
peer leadership, conflict resolution and participate in monthly field trips. 

Ten young people are placed in year-round jobs through the Taunton Department of 
Human Services. One teen worker from Taunton noted that, "This job has also enabled me to 
prove I am responsible and to have a reputation as a good worker..." Placement sites in 
Taunton include two local high schools, public agencies, the YMCA and the Boys and Girls 
Club. 

"Buen Trabajo" is the program developed by the Holyoke Youth Alliance for 
implementation of their SNI Jobs program. This program reinforces literacy by training 
twelve youth to be teen educators and to read to young children in the waiting room of a large 
pediatric practice in the city. 

For implementation in the city of Worcester, we work with the YMCA. After an 
intense job training program, ten youth were placed in jobs at the YMCA and at three other 
community sites -- the Henry Lee Willis Community Center, YouthNet, and the Worcester 
Community Action Council. 

The City of Lynn collaborates with Girls Inc. to provide a thorough job preparedness 
program for seven students in Lynn. After completing the program at Girls Inc.'s Career 
Learning Center, students are employed at the Community Minority Cultural Center as well 
as Lynn Arts, Inc. and Raw Arts, Inc. 

Twenty-five young people in New Bedford receive comprehensive job readiness 
training through U.Mass Dartmouth's Neighborhood College. Training is specific to the 
needs of area employers who actually pay the salaries of the young people, rather than 
relying on grant ftmds. 

The Springfield SNI Jobs for Youth Program is implemented through the Springfield 
Southwest Community Health Center which hires six workers to serve as peer health 
educators/ outreach workers. The peer educators write, direct and star in skits used as 
teaching tools on such issues as HIV/ AIDS, teen pregnancy, self esteem, decision making, 
and youth violence. Performing at many community events, the teens also had one of their 
skits, "Teen Decisions," featured in the local press. 

The SNI Jobs for Youth Program is a solid demonstration of the Attorney General's 
commitment to yotmg people and knowledge that prevention is one of the best and least 
expensive ways for communities to reduce juvenile crime. In addition to reducing juvenile 
crime, the program also enhances self-esteem, life skills, and the work ethic and decision- 
making abilities of young people allowing them the opportunity to make a successful 
transition into adulthood. 



145 



In addition to the SNI Jobs for Youth Program, we fund several community-based 
agencies that provide programming focused on prevention, intervention and treatment. One 
of the premier subcontracted programs of the Dorchester Safe Neighborhood Initiative is the 
Child Witness to Violence Project (CWVP) out of Boston Medical Center. In Dorchester, 
while rates of community violence have decreased over the past five years, reporting rates for 
domestic violence have actually increased. Recent data from the Boston Police Department 
reveals that 82% of reported simple assaults in the target area were related to domestic 
violence. In many of these situations, there are children who witness this violence. In order 
to more effectively identify children at risk and provide them with needed services, the Child 
Witness to Violence Project links social workers and psychologists with community outreach 
workers and police officers to address the needs of young children who witness violence. 

Under the direction of Betsy McAlister Groves, named Massachusetts Social Worker 
of the Year in 1998, the Child Witness to Violence Project made incredible strides in 
disseminating information throughout the state and country about children who witness 
violence. Thousands of people benefitted from the project through various conferences, 
workshops, lectures and presentations. Since police officers are often the first on the scene of 
violent incidents, and therefore in an important position to make a referral, CWVP also runs a 
special program to train police about working with and referring children with whom they 
come in contact. Twenty Boston Police officers completed this training program during 
1998. 

Working directly with children and families is the other important component of 
CWVP's work, and during 1998 the project carried an average quarterly caseload of 47 
children and 39 families. The project also received a total of 1 15 new referrals throughout 
the year, most of them for children who witnessed domestic violence. In addition, more than 
250 patient visits were completed by CWVP staff during fiscal year 1998. 

Another nationally known initiative which is key to our Dorchester project is the 
Vietnamese Community Liaison who is hired out of Boston Police Department District C-11. 
C-1 1 is the home to the largest Vietnamese population in the city. Census data showed a 600% 
increase in the Vietnamese population in the area from 190 to 1,990 as compared to an overall 
population increase of 2.6% . Police and service agencies in Dorchester report an increasing 
demand for services from this population. 

Tram Tran continues to serve the large Vietnamese community of Dorchester by 
serving as a bridge between the police and residents. Ms. Tran gets involved in prevention, 
intervention and treatment activities by presenting public safety workshops, providing 
translated information on a variety of topics to residents, serving as a mediator in disputes, 
accompanying community members through various court and police processes, and 
referring those in need to appropriate social services. 

Emerging immigrant populations are also a major issue in the Brockton SNI, and 
project staff in that city have translated informational brochures into Portuguese, Creole, 
Spanish and Cape Verdean. 

Prevention, intervention and treatment efforts in our Grove Hall SNI (GHSNI) focus 
on five quality of life issues defined as priorities by that community. The issues are: 



146 



domestic violence; crimes against senior citizens; prostitution/) ohns; underage drinking/sale 
of alcohol to minors; and motor vehicle violations on residential streets. 

During 1998, programs funded through the GHSNI included Roxbury Multi-Service 
Center's Community Programs Against Sexual Assault which conducted a highly successful 
prevention campaign including two peer conferences that drew more than 500 teenagers. 
Discussions at these conferences focused on maintaining healthy, non-violent dating 
relationships. Working with young people on dating violence issues is a critical part of our 
domestic violence initiatives. 

The Adolescent Life Options Program (ALOP) out of Roxbury Comprehensive 
Health Center, another GHSNI-funded program, reported that 3,000 teens and parents were 
reached with information from ALOP peer educators. In the 1996-97 school year, 153 youth 
participated in the program's after school educational support activities, and eleventh and 
twelfth grade participants increased scores on the SAT by an average of 1 00 points. The 
Substance Abuse Prevention component of ALOP reached over 1000 teens through drug 
education seminars, and another 700 through one-on-one counseling sessions. Pre- and post- 
tests administered to workshop participants reflected an alarming tolerance and acceptance 
among teenagers of alcohol use and abuse. 

Three other community-based programs in the Grove Hall area provided outreach to 
more than 40 prostitutes in the area — referring them to health services and substance abuse 
treatment programs and working to provide them with more stable living arrangements. 

Early in 1998, the GHSNI awarded Seed mini-grant funding to five additional 
community-based organizations, many of which are providing outreach to senior citizens and 
intergenerational programming for young people and elders. 

The Grove Hall SNI was also a co-sponsor with the Attorney General's Office and 
American Express Financial Advisors of a highly successful telemarketing fi-aud conference 
held in May. Presenters provided information to seniors and other community residents on 
how to detect fraudulent offers and what to do if you or someone you know has been the 
victim of some kind of scam. 

Providing young people with effective use of their out of school time is vital to 
prevention efforts, and the Dorchester Youth Collaborative and the Holland Community 
Center, additional partners in our Dorchester project, provided recreational activities for 
hundreds of young people and families throughout this year. The Dorchester Youth 
Collaborative also continued to intervene in several gang disputes and employ former gang 
members to provide outreach services for at-risk young people. 

Truancy, which is a significant predictor of future criminal activity, is another issue 
that was addressed in our Grove Hall target area this year. Through implementation of their 
initiative Opening Doors, the Boston Urban Youth Foundation (BUYF) has involved 26 young 
people in their program. The group-all of whom remmed to school— is divided evenly between 
high school and middle school students. In the summer months, BUYF holds cook-outs in Grove 
Hall to remain in contact with the young people and track their progress. When the school year 



147 



begins, BUYF will have staff assigned two days per week to track truant youth at the Martin 
Luther King and Lewis Middle Schools and the Burke High School. 

Coordinated Law Enforcement 

SNI Community Prosecution 

Our community prosecution program is a critical cog in our coordinated law 
enforcement component. SNI prosecutors at the Superior and District Court levels continued 
to serve in non-traditional roles, allowing them to provide outstanding service to target 
communities and perform as even better advocates for the Commonwealth. Attending 
commimity meetings and special events, developing joint initiatives with other law 
enforcement agencies, and utilizing sentencing and probation options not only to penalize 
offenders but also to rehabilitate them so they do not return to the criminal justice system, are 
just a few of the ways SNI prosecutors work to serve their respective target communities. 

An innovative probation agreement that was drafted by AAG Shelley Richmond is a strong 
testament to the depth of involvement SNI prosecutors have in the community and to our 
prosecutors' willingness to be creative in developing means for offenders to be rehabilitated. 
Indicted in 1996, a young defendant out of Grove Hall was found delinquent of three separate 
drug distribution cases and one possession of a firearm case. Committed to DYS facilities a 
number of times, the young man began to work as a counselor to younger youth and also assisted 
police in other cases. He subsequently graduated from a DYS Residential Program and from East 
Boston High School. A star football player, the young man lost his chances at receiving a 
football scholarship because of this arrest. He was, however, accepted into Delaware State 
University. 

AAG Richmond had numerous conversations with the young man's DYS worker and the 
Community Disorders Unit Detective with whom he had worked. The decision was made to dismiss 
the firearm charge so that the young man could attend college this fall. He was sentenced to 
five years probation with special conditions including continuing to work toward completion of 
a degree, maintaining a minimum grade point average, submitting to random drug testing, and 
performing community service. The young man is reported to be doing quite well in college and 
playing football as a walk-on member of the team. 

Similar efforts were put forth by AAG Marcia Jackson as she worked early in the 
fiscal year to assist the victim of a 1995 shooting. The victim was visiting Boston from 
Atlanta and was the unintended target of an afternoon shooting the day before he was to 
return home. The shooting resulted in the loss of his right eye and upon his return to Atlanta 
he was unable to find work, developed a drug habit and committed a robbery. AAG Jackson 
assisted the victim with utilizing the Victims Compensation Act to obtain a prosthetic eye 
and is working with him to explore employment opportunities in Boston and to provide 
information to his probation officer in Atlanta about the extent of his injury and the impact it 
has had on his life. 

Prosecution teams are critical to the SNl's efforts to create healthier communities and 
to demonstrate that community residents should play an active role in the justice process. 

Grove Hall Safe Neighborhood Initiative Prosecution Statistics 

148 



Roxbury District Court 


FY 1998 


Cases Disposed 


377 


Defendants Committed to House of Correction 


86 


Defendants Receiving Probation Sentences 


91 


Number of Community Service Hours Ordered 


4298 


Cases Dismissed to Superior Court Indictments 


36 


Defendants in Default 


144 


Suffolk Superior Court 


FY 1998 


Cases Indicted 


82 


Cases Disposed 


60 


Defendants Committed to State Prison 


31 


Defendants Committed to House of Correction 


12 


Defendants Receiving Probation Sentences 


15 



149 



Dorchester Safe Neighborhood Initiative Prosecution Statistics 



SNI Intake Cases Screened/Reviewed in FY 1998 


1360 


Dorchester District Court 


FY 1998 


Cases Prosecuted 


1963 


Cases Disposed 


1071 


Defendants Committed to Jail 


98 


Defendants Committed to DYS 


13 


Defendants Receiving Probation Sentences 


106 


Suffolk Superior Court 


FY 1998 


Cases Disposed 


94 


Defendants Committed to Jail/State Prison 


63 


Defendants Receiving Probation Sentences 


9 



Uphams Corner Safe Neighborhood Initiative Prosecution Statistics 



Roxbury District Court 


7/1-12/31/1997 


Cases Prosecuted 


275 


Cases Disposed 


103 


Defendants Committed to House of Correction 


16 


Defendants Receiving Probation Sentences 


38 


Number of Community Service Hours Ordered 


1215 


Cases Dismissed to Superior Court Indictments 


18 


Defendants in Default 


88 


Suffolk Superior Court 


FY 1998 


Cases Indicted 


30 


Cases Disposed 


21 


Defendants Committed to State Prison 


10 


Defendants Committed to House of Correction 


7 


Defendants Receiving Probation Sentences 


4 



150 



Brockton Safe Neighborhood Initiative Prosecution Statistics 



District Court 


FY 1998 


Cases Screened 


1065 


Cases Prosecuted 


1022 


Cases Disposed 


715 


Defendants Committed to House of Correction 


191 


Defendants Receiving Probation Sentences 


264 


Cases Dismissed to Superior Court 


34 


Juvenile Court 


FY 1998 


Cases Screened 


167 


Cases Prosecuted 


167 


Cases Disposed 


102 


Defendants Committed to DYS 


20 


Defendants Receiving Probation Sentences 


43 


Cases Dismissed to Superior Court 





Youthful Offender Cases 





Superior Court 


FY 1998 


Cases Indicted 


25 


Cases Disposed 


29 


Cases Committed to House of Correction 


11 


Cases Committed to State Prison 


14 



Another key element of the SNI's coordinated law enforcement strand is community 
policing. High-ranking police officials are actively involved in SNI Advisory Councils and 
meet regularly with community groups and individual residents to address concerns. 
Community policing projects of SNI target areas have demonstrated a strong impact on crime 
statistics in target communities. In addition to falling crime rates, an unprecedented level of 
cooperation and collaboration with the police is reported by residents, merchants and social 
service agencies staff report. 

In our Grove Hall Safe Neighborhood Initiative, large crowds gathering in Grove Hall 
on weekend nights have been an ongoing problem. The crowds cause various public safety 
and traffic problems and disturb the peace and well-being of neighbors in the area. With the 
assistance of SNI partners, a petition was circulated and the requisite number of signatures 



151 



was collected to hold a licensing board hearing on whether to roll back the hours of two 
businesses who currently remain open until 4 a.m. In other areas of the city, rolling back the 
hours of businesses with late hours has succeeded in cutting down on crowds and restoring a 
sense of safety to residents. The hearing was held at the end of June and overwhelming 
support was shown for rolling back the hours. More than 1 20 residents and other concerned 
citizens attended and heard police and others testify about problems in the area. The 
following day, the Licensing Board made the decision to roll back the hours of the two 
businesses in question to 1 :00 a.m. We consider this a major victory for the coirmiunity and 
hope to see a marked difference in Grove Hall on weekend nights. Bringing the community, 
police, and prosecutors together for a coordinated approach to this problem has benefitted the 
residents of the area most affected by this longstanding problem. 

As part of its coordinated law enforcement efforts, the Brockton SNI developed a Ten 
Most Wanted Criminals Program this year. To date, this effort has resulted in the 
apprehension of five fugitives, with five more potential candidates under review. 

Joint investigations with federal agencies are another important piece of our 
coordinated law enforcement component. Late in this fiscal year, a Suffolk County Assistant 
District Attorney assigned to the Grove Hall project was instrumental in working with the 
Drug Enforcement Administration on an 1 8-month investigation which netted 54 arrests on 
Castlegate Road, known to be a haven for drug activity. Thirty-one of the 54 individuals 
arrested will face federal indictments. 

Neighborhood Revitaiization 

Grove Hall Abandoned Properties Project 

A major component of our neighborhood revitaiization efforts toward the end of this 
year was our initiation of an abandoned properties project for Grove Hall. The project aims 
to use a Receivership Statute which was enacted in Massachusetts in 1 993 to undertake and 
oversee the rehabilitation of residential properties with persistent, unremedied code 
violations. The legislation was originally intended to permit tenants and other occupants of 
residential properties to seek the appointment of such a receiver who would have the 
independent authority to undertake required repairs, after notice and an opportunity to cure 
was provided to the landlord and creditors of record. The most significant features of the 
statute are that it provides a limited scope of receivership liability related solely to the work 
actually undertaken at the property and that the costs and expenses incurred by the receiver in 
fiilfiUing the duties become a priority lien, recoverable against both the landlord and the 
property prior to any pre-existing liabilities other than outstanding real estate taxes. 

Stuart Rossman, Chief of the Attorney General's Business and Labor Protection 
Bureau, has successftilly implemented this project in other areas of the state, and the GHSNI 
Coordinating Council indicated their enthusiastic approval of moving forward on the project 
in Grove Hall. Our Seed Coordinator is working with community residents to inventory 
abandoned properties in the target area, and nine Attorney General staff members have 
volunteered to work with the community on the project. In addition to the prospect of 
restoring properties that have been problems in the community, the other exciting aspect of 
this initiative is that while the Attorney General's Office leads the effort on the first few 
properties, the community is guided through the process to enable them to later implement 



152 



the procedure on their own. This empowers the community which is vital to our efforts to 
increase the sustain ability of the project. 

This Neighborhood Means Business!™ (TNMB!) out of the Dorchester Center for Adult 
Education is funded through the Dorchester Safe Neighborhood Initiative and is another 
important part of our neighborhood revitalization efforts. For the last three years, TNMB! has 
provided entrepreneurship education in English and Spanish, graduating more than 75 
individuals. Merchants who complete the program are eligible for business loans, and TNMB! 
works with lending institutions to develop appropriate loan packages for graduates whose 
business plans demonstrate that a loan would be beneficial at this time in their businesses' 
development. Mentor relationships are also developed to provide support and reality testing 
that is often necessary for the success of the business' development. The mentors assist in 
developing business plans for each participant by applying the information that the 
participants learn to the practical reality of each business. 

Active merchants' associations also play an important role in the vitality of Safe 
Neighborhood Initiative communities. When Attorney General Scott Harshbarger met with 
Dorchester SNI Advisory Council members in February to commemorate the SNI's fifth 
anniversary, a merchant who had a gun held to her head outside of her restaurant made an 
important point about how crime can affect businesses and, therefore, neighborhood growth 
and revitalization. She indicated that since the SNI had been successftil in ridding the streets 
of crime, merchants are now able to focus more fully on running their businesses rather than 
assuring their personal safety and that of their patrons. Merchants indicated their 
appreciation to the Attorney General and all those involved in SNI efforts. 

Conclusion 

The past fiscal year has been distinguished by many successes. The addition of a 
second SNI Program Coordinator allowed us to reach out to more communities in need 
across the state than ever before. We are confident that the funding for innovation grants and 
the implementation of additional SNI Jobs for Youth Programs will positively impact 
Massachusetts communities and assist young people to grow and develop into productive 
adult citizens. SNI Advisory Council members worked tirelessly with us to assure the 
continuation and the strength of established SNI projects, and new initiatives were 
undertaken in all of our sites to address concerns brought forward by the commimities. The 
SNI continues to be a strong model of how commimities and law enforcement can work 
together effectively to improve the quality of life in neighborhoods throughout the state. 

Safe Neighborhood Initiative StafT 

Staff members assigned to the SNI as of the end of fiscal year 1998 are Deputy Chief 
Susan Spurlock; Assistant Attorneys General Marcia Jackson, Neil Tassel, Katherine Hatch, 
Shelley Richmond Joseph, Gleim MacKinlay, and Linda DelCastilho; SNI Program Coordinators Lara 
Ramey and Sandra McCroom; Administrative Assistant Nancy Tavilla; and Community-Court Liaison 
Cara Henderson and Christina Dilorio-Sterling. Audrey Huang, an Assistant Attorney General in 
the Public Integrity Division, served as district court prosecutor on the Uphams Comer SNI 
through December of 1997, and David Breen, currently assigned to the Narcotics and Special 



153 



Investigations Division, was the district court prosecutor for the Grove Hall SNI through 
February. 



154 



VICTIMAVITNESS ASSISTANCE PROGRAM 

In January, 1994, Attorney General Scott Harshbarger identified the need for support 
services for victims and witnesses throughout his entire office. At that time, he formally 
introduced these services in the Criminal Bureau by appointing Kathy Morrissey to the 
position of Victim/Witness Advocate. The Victim/Witness Assistance Program of the 
Attorney General's Criminal Bureau was developed to meet the following goals: (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 (G.L. c. 258B). 

Fiscal year 98 ushered in a banner year for the Victim/Witness Assistance Program 
which responded to significant challenges to provide services to a high volume of victims 
and witnesses. Victim advocacy and witness management services were provided by Kathy 
Morrissey on 32 cases covering nine counties across the Commonwealth. 

Three cases of particular note illustrate work in priority areas set by the Attorney 
General: (1) public corruption; (2) elder fraud; and (3) white collar crime. 

(1) Commonwealth v. Edward K. Boyer and Pedro Cumba. Jr. 

The Boyer case involved a high profile defense attorney and his employee, Pedro 
Cumba, who, allegedly, on more than one occasion, attempted to make payments to violent 
crime victims and witnesses in exchange for their not testifying against his clients in criminal 
matters. The defendants were charged with interference with a witness and bribery. From a 
victim/witness perspective, this public corruption case presented victims and witnesses with 
critical needs for safety and support. The case was prosecuted by Assistant Attorney General 
Frances A. Mclntyre, Chief of the Criminal Bureau, and Assistant Attorney General Michael 
Zullas of the Public Integrity Division. Each defendant was convicted and sentenced to two 
and one-half years in the House of Correction and a $1,000 fine. 

(2) Commonwealth v. Algie J. Urbonas 

The Urbonas case featured an investment scam which targeted retired and/or elderly 
victims by an investment advisor. Algie J. Urbonas, allegedly, defrauded victims of more 
than $300,000. He betrayed the trust of his clients and stole their money. This case was of 
great victim/witness import as a white collar case involving multiple retired and elderly 
victims. The case was prosecuted by Assistant Attorney General Margaret Parks. The 
defendant pleaded guilty and was sentenced to two years in jail followed by three years of 
probation. 

(3) Commonwealth v. London & Global, Inc. 
Commonwealth v. Man Kin "Daily" Chan 
Commonwealth v. Odon "Danny" Do Vale 



155 



The London & Global case involved an international investment scam effectuating a 
theft in excess of $1,500,000 from approximately 140 victims. The victims were individuals 
hired as account executives or "traders" and their investor clients. The victims were 
allegedly defrauded by being persuaded by agents of London & Global to hand over their 
money to a fictitious foreign currency investment enterprise. The defendants, London & 
Global, Inc., Man Kin "Daily" Chan and Odon "Danny" DoVale, were charged with larceny, 
securities fraud and other related charges. The sheer volume of victims and witnesses in this 
case posed great victim/witness demands for victim advocacy with heightened concerns 
about restitution coupled with witness management issues, specifically, ongoing notification 
of case status, coordinating witness trial preparation and post conviction distribution of 
restitution. The case was prosecuted by Assistant Attorneys General Kevin Brekka, Jeremy 
Silverfine, Chief of the Public Integrity Division, and John Grossman. A default judgment 
issued against London & Global, Inc. and $143,000 was forfeited as restitution. Man Kin 
"Daily" Chan pleaded guilty and was sentenced to four to five years and one day in state 
prison and forfeiture as restitution in the amount of $96,000. Odon "Danny" DoVale was 
convicted and sentenced to two and one-half to three years in state prison. 

In addition to victim/witness services provided on cases in the Criminal Bureau, 
Kathy Morrissey assisted prosecutors, investigators and state troopers by screening daily duty 
calls from the public when specific victim/witness questions were raised. 

Ongoing training and networking are also part of the advocate's responsibility. 
Toward that end, Kathy Morrissey represented the Attorney General at two premier 
conferences in FY98: (1) Meeting the Needs of Crime Victims - A Conference for Victim 
Services Professionals from the New England States; and (2) the 23rd Annual National 
Organization for Victim Assistance Conference and International Summit. 



156 



FAMILY AND COMMUNITY CRIMES BUREAU 

The Family & Community Crimes Bureau was created by Attorney General Scott 
Harshbarger in 1991 to develop and coordinate policy, programs, legislation and training for 
law enforcement and other professionals on family and domestic violence, juvenile justice 
and youth violence prevention, and the protection, health and education of children. In 
addition, the Bureau houses the Victim Compensation and Assistance Division, which 
receives, reviews and approves claims for compensation filed by victims of violent crime. 

FAMILY AND DOMESTIC VIOLENCE 

Throughout Fiscal Year 1997, the Bureau continued to honor the Attorney General's 
commitment to provide quality training opportunities and educational information for law 
enforcement officers, and other professionals, on domestic violence. In October of 1997, the 
Bureau presented the Attorney General's Seventh Annual Domestic Violence Police Training 
Conference. This conference, entitled "Domestic Violence: The Continuing Challenge for 
Law Enforcement," was attended by over 320 state, municipal and campus police officers 
from throughout the Commonwealth. To supplement this effort, periodic training updates 
continued to be provided to officers through publication of the Domestic Violence Update 
segment of the Attorney General's Law Enforcement Newsletter. Bureau attorneys and staff 
also participated in a number of other training programs throughout the year, including a 
series of three conferences on relationship violence sponsored by the Massachusetts 
Association of College and University Public Safety Directors; regional training programs for 
municipal officers on domestic violence sponsored by the Massachusetts State Police; the 
Fourth Annual Statewide Prosecutors and Advocates Domestic Violence Conference 
presented in May, 1998; the seventh annual convocation of the Justice George Lewis Ruffm 
Society entitled, "Family Violence: Prevention - Treatment - Prosecution; and a forum on 
teen dating violence for students at Xaverian High School in Westwood. Completing a year- 
long project, the Bureau also worked in collaboration with the Massachusetts District 
Attorneys Association to achieve the December, 1997, publication of "The Massachusetts 
Prosecutors' Manual: Domestic Violence and Sexual Assault," which the Bureau helped to 
disseminate to every district attorney's office in the state. 

In ongoing recognition of the critical need to involve every aspect of the community 
in the fight against domestic violence, the Bureau continued to work with other professional 
groups during FY'97 to promote community education and intervention in this area. 
Specifically, in October, 1997, the Bureau published, in collaboration with the Religious 
Community Task Force of the Boston Coalition, "Responding to Domestic Violence: A 
Guide for Clergy and Laity." Hundreds of copies of this manual have been disseminated to 
clergy members across the Greater Boston area, and surrounding communities, through its 
use at conferences, community events and local forums. Also in October, the Bureau, in 
conjunction with the Women's Bar Association of Massachusetts, released a report on sports 
and the prevention of domestic violence by publishing a summary of the proceedings and 
recommendations from a conference presented on that subject earlier in the year, and jointly 
sponsored with the WBA. In its continuing capacity as a founding member of Employers 
Against Domestic Violence, the Bureau participated in the presentation of a training program 
on domestic violence in the workplace and the development of a model policy for employers. 



157 



Two significant legislative packages on domestic violence were drafted by the Bureau 
and filed by the Attorney General during this fiscal year. The first sought to enhance 
protections for victims under the state's abuse prevention and stalking laws., including 
providing for longer duration of restraining orders and enhanced penalties for repeat 
violations. The second sought to address the problem of serial or chronic abusers, by 
providing for the issuance of protection orders in the case of multiple offenders, as well as 
the creation of an habitual domestic violence offender statute. In tandem with this legislative 
proposal, the Bureau presented a comprehensive plan to help identify and respond to these 
repeat offenders through the utilization of new technology, the development of community 
collaborations, and the collection and analysis of information regarding domestic violence 
homicides. By focusing intensive law enforcement attention on these offenders, the objective 
is to help prevent fixrther, and perhaps more lethal, acts of violence. 

Fiscal Year 1997 marked the launching of the office's Child Witness to Domestic 
Violence Project, a collaborative effort between the Bureau and the Child Witness to 
Violence Project at Boston Medical Center. The project, supported by a grant under the 
federal Violence Against Women Act, is designed to provide training, education and 
technical assistance to communities in their efforts to identify and respond to children who 
live with, or otherwise witness, domestic violence. In so doing, the project seeks to help both 
improve the quality of life for these children, and provide long-term prevention, as these 
children are at great risk of a variety of negative consequences, including themselves become 
offenders or victims in the future. During the past year, the project presented a total of seven 
regional one-day training conferences to multidisciplinary audiences, reaching a total of over 
1600 professionals who work with children, and two two-day clinical seminars for child 
clinicians and counselors. The project will ultimately reach every part of the Commonwealth 
with similar conferences and seminars during calendar year 1998. 

In a related effort, and in recognition of the harmful effects of domestic violence on 
children. Bureau attorneys spearheaded the office's support of legislation designed to 
presumptively preclude domestic violence offenders from obtaining custody of their children. 
These efforts included presenting testimony at legislative hearings, and filing a friend-of- 
court brief with the Supreme Judicial Court supporting the constitutionality of such 
legislation. This legislation was passed into law in July of 1998. 

The Bureau also participated in the January, 1998, publication of a report by the 
National Resource Council on effective family violence intervention programs and policies. 

YOUTH VIOLENCE 

As the culmination of a series of luncheon discussions sponsored by the office, in 
conjunction with the Harvard School of Public Health, the Bureau published a 
comprehensive report on youth violence prevention strategies in November of 1997. This 
report, entitled "No Time to Lose," provided a set of specific recommendations for 
communities, criminal justice agencies, schools, state agencies and service providers for 
intervention and prevention of violence perpetrated by our young people. In the spring of 
1 998, the report was distributed to all school administrators across the Commonwealth in an 
effort to provide guidance and support in the wake of recent incidents of school-based 
violence in other states. Implementing at least one component of the report. Bureau attorneys 
worked to develop a truancy prevention guide for area schools and communities, including a 



158 



checklist of steps that could be taken to increase school attendance and participation and 
thereby reduce opportunities for juvenile crime. This guide will be distributed in the fall of 
1998. In a related effort, and as part of the Bureau's ongoing participation in a Boston Bar 
Association task force on children in need of services (CHfNS), the Bureau oversaw the 
office's collaboration on the production of a resource guide of community-based services for 
truant youth in the Boston area. This guide is also slated for publication in the fall of 1 998. 

In December of 1997, the Bureau presented the Attorney General's fourth Safe 
Schools Conference, entitled "Protecting the Child and the School Community: The Ongoing 
Challenge." This conference was attended by approximately 250 multidisciplinary 
professionals from across the Commonwealth, including school administrators and teachers, 
police officers, service providers and community health providers. To supplement the 
Attorney General's ongoing efforts to support school personnel in ensuring a safe learning 
environment, the Bureau published two additional issues of the office's Safe Schools 
Newsletter, which is distributed to every school administrator and police chief in the state. 

During the fiscal year, Bureau attorneys continued to guide the Attorney General's 
strong and vocal support for comprehensive firearms legislation that would restrict certain 
assault weapons, and reduce the general availability of firearms to children, teenagers and 
others. As a result of these and other efforts, a substantial and significant Gun Control Act 
was passed in July of 1998. 

Responding to the case of one juvenile offender previously convicted of murder, but 
subsequently deemed to be beyond the reach of the juvenile justice system because of his 
advanced age, the Bureau, with the Attorney General, filed a fiiend-of-court brief with the 
Supreme Judicial Court challenging that determination. The brief argued that recent 
amendments to the juvenile justice statutes were applicable to this individual. The Court 
ultimately agreed with the argument, and returned the individual for trial to the Juvenile 
Court. 

CHILDREN 

In May, 1998, the Bureau helped organize and led the Attorney General's co- 
sponsorship of, a statewide, two-day conference on child abuse and neglect. This conference, 
entitled "Consequences of Child Maltreatment: Working Together Toward a Better 
Outcome," was attended by nearly 500 child professionals, including judges, social workers, 
law enforcement officers, prosecutors, mental health providers, attorneys and others. All 
aspects of the state's child protection system were addressed, with a focus on developing 
strategies and plans for enhancing that response for the benefit of children. 

Throughout the fiscal year. Bureau attorneys were involved in the drafting and the 
Attorney General's filing of legislation to promote child welfare. To protect children, the 
Bureau drafted a bill to prohibit the sexual exploitation of minors on the Internet, and to 
update child pornography statutes to cover computerized images of children. Bureau 
attorneys were also instrumental in developing policy and practice recommendations for 
implementation of the state's Sex Offender Registry, and filed legislation to improve its 
operation and make it less vulnerable to legal challenges. The Bureau drafted legislation 
designed to ensure the enforcement of open adoption agreements, and drove the Attorney 
General's support for bills to authorize permanent guardianships for children in child 



159 



protective custody, and to create a program for newborn home visiting. These latter two bills 
were signed into law during 1998. 

VICTIMS 

During FY'97, the Bureau to published its newsletter devoted entirely to victims' 
rights and victim services ~ "Focus on Crime Victims;" and assisted the Attorney General in 
his capacity as chairman of the Victim Witness Assistance Board, and in his oversight of the 
Massachusetts Office for Victim Assistance (MOVA). Along with MOVA, the Attorney 
General sponsored the 1 998 Victim Rights Conference in April, which again attracted several 
hundred victim advocates, crime victims, police officers and others to discuss issues of 
importance to victims of crime. 

Attorneys assigned to the Bureau continued to serve as the Attorney General's liaison 
to the Massachusetts Chiefs of Police Association, and the Western Massachusetts Chiefs of 
Police Association; and continued to actively participate as a member of the Supreme 
Judicial Court's Standing Committee on Substance Abuse, which issued standards for the 
Trial Court on effective intervention strategies to address substance abuse issues throughout 
the court system. 



160 



VICTIM COMPENSATION AND ASSISTANCE 

The Victim Compensation and Assistance Division provides financial compensation, 
referrals and other assistance to victims of violent crime. Most significantly, it assists 
qualifying victims and their families in paying for out-of-pocket medical expenses, lost 
wages and other crime-related expenses. Since 1 994, the Division has assumed legal and 
administrative responsibility for receiving, investigating and determining all compensation 
claims in accordance with the requirements of G. L. c. 258C. Previously, compensation 
claims were determined through a litigation-based process in the district courts. 

Fiscal year 1998 was marked by continued claims growth, reduced spending, and 
increased efficiency through the development and implementation of an automated claims 
processing system. The year is also noteworthy for a significant reduction in homicide 
claims, and for the Division's successful efforts to reach and serve more victims of domestic 
violence. 

1. Claims Activity : In FY98, the Division received 1,139 claims for victim 
compensation. This represents a 9% increase over the previous year and is due, in part, to the 
Division's increased efforts to ensure that all crime victims are informed about the Division's 
ability to assist them with their crime-related expenses. 

The Division issued 1,476 decisions. These included 1,087 initial decisions and 389 
supplemental decisions, responding to victims' requests that their claims be reopened for 
payment of additional expenses. While the total number of decisions issued in 1998 is 
roughly equivalent to the total number of decisions issued in 1997, this year's activity shows 
a 90% increase in the number of supplemental decisions. Most of these supplemental 
decisions concern payment for ongoing mental health counseling services. 

Despite receiving more claims, the Division continued to maintain a pending caseload 
of fewer than 500 claims. At the close of the year, there were 470 open claims in the 
Division. The average claims processing time continued to approximate 4 months. Victims 
continued to report great satisfaction with the amoimt of time it takes to process claims for 
victim compensation. 

Analysis of the Division's decisional activity shows general consistency with previous 
years. In 1998, 87% of persons applying for victim compensation were found to have met 
the program's basic eligibility requirements. These include the statutory requirements that 
the crime be reported to police or to a court (through the issuance of a domestic violence 
restraining order), that the claimant provide reasonable cooperation in the investigation and 
prosecution of the crime, that the victim not have provoked or contributed to his or her 
injuries, and that, except for minors, the claim be filed within three years of the date of the 
crime. Only 13% (144) of those applying for compensation failed to meet these basic 
eligibility requirements. 

Of the 943 claimants who were found eligible for victim compensation, 648 claimants 
(60%)) were issued a "Notice of Award" to cover their current uninsured expenses and/or lost 
wages. The remaining 295 claimants did not currently have out-of-pocket expenses for which 



161 



the Division could award compensation. These individuals may reopen their claims if they 
incur any future crime-related expenses. 

Under G.L. c. 258C, claimants are entitled to seek internal administrative review of 
the Division's decisions. In 1998, the Division reconsidered 60 initial claims, representing 
5% of the Division's decisions. In 17 of these cases (28%), the Program Director modified or 
reversed the 
original decision. The remaining 47 decisions were affirmed on reconsideration. 

Claimants are entitled, in addition, to seek judicial review of the Division's decisions. 
In 1998, four claimants filed petitions for judicial review. One petition resulted in the 
claimant receiving additional lost wages. One petition was dismissed by the court and the 
other two remain pending. 

Victim data show some shifts in the types of claims paid by the Division this year. 
First, the number of homicide claims dropped from 25% of all claims in 1997 to 17% of 
claims this year. This reduction presumably reflects the overall drop in homicide rates in 
Boston and throughout the Commonwealth, as well as the effectiveness of outreach efforts to 
other eligible crime victims. Second, the number of domestic violence claims increased from 
5% in 1997 to 13% in 1998. The Division attributes this increase to its concerted efforts to 
provide information and training to all programs and shelters providing services to battered 
women. Overall, the largest category of claims receiving payment were filed by victims of 
assault (49%). Child sexual assault claims represented 1 1% of claims, followed by adult 
sexual assault (5%) and DWI/DUI (3%). The remaining 2% of awards were classified as 
"other". 

Analysis of victim age data shows that 1 3% of all awards involved victims under the 
age of 17. Victims between the ages of 18 and 65 represented 86% of all awards, while 
victims over the age of 65 represented 1% of awards. 97% of all compensation awards were 
made to Massachusetts state residents. The remaining 3% of awards involved nonresidents 
who were victimized in the Commonwealth. 

2. Expenditures : In 1998, the Commonwealth paid $2,743,1 57 in compensation to 
crime victims. This represents a 27% reduction from 1 997 expenditures, and marks the 
second consecutive year in which expenditures have been more than adequate to support 
obligations. The program has clearly achieved financial stability, and is well positioned to 
expand the scope of financial assistance it provides to crime victims. 

Reduced expenditures are attributable, in part, to the Division's confinued efforts to 
maximize the benefit of victim compensation funding. This year, the Division continued to 
careftiUy screen all claims for potential reimbursement through hospital-based "free care," 
public insurance programs and other sources. When these options appeared viable, the 
Division referred victims to alternative sources of reimbursement. When alternatives were 
not available, the Division actively negotiated with medical providers to accept reduced 
payment on victims' outstanding bills. In order to standardize this practice, this year the 
Division implemented a policy of offering medical and dental providers 70% payment on 
outstanding bills. In response, most providers accepted the Division's terms, and agreed to 
release the victim from liability for any outstanding balance. 



162 



Analysis of the Division's payment data shows that while the Division is statutorily 
authorized to award up to $25,000 per claim, only 23 claims resulted in the maximum award. 
The average award in 1998 was $4,090, up from $3,776 in 1997. As in previous years, the 
largest category of payment (54%) was for economic support in the form of lost wages and 
loss of financial support to the dependents of homicide victims. Medical and dental expenses 
represented 24% of all expenses. Reflecting the drop in homicides rates and claims, fimeral 
and burial expenses represented 12% of the Division's expenses this year, compared to 25% 
in 1997. These were followed by mental health counseling expenses (9%) and "other 
expenses" (homemaker expenses and attorneys fees), representing less than 1% of all 
expenses. 

Outreach and Training : This year, the Division placed special emphasis on outreach 
and training. Using administrative funding made available through the federal Victims of 
Crime Act ("VOCA"), the Division designed and produced informational wall posters 
describing the program. These posters were distributed, along with applications and other 
training material, to 140 hospitals, 138 community health centers, 45 hospital-based domestic 
violence programs, 60 VOCA-funded victim service programs, 30 sexual assault programs, 
55 battered women's service programs, and to numerous child witness to violence programs, 
bereavement programs, child sexual assault programs, and programs related to the Attorney 
General's Safe Neighborhood Initiative. In response to these materials, many organizations 
accepted the Division's offer to provide in-house training. These included organizations 
such as the Asian Task Force Against Domestic Violence, Lynn/Peabody Catholic Charities, 
Children's Charter, Uphams Comer Health Center, Whittier Street Health Center, Neponset 
Health Center, Planned Parenthood League of Massachusetts, Children's Hospital, Boston 
Area Sexual Assault Coalition, Worcester Youth Guidance Center, Clinical and Support 
Options, DOVE (Domestic Violence Ended), Women's Crisis Center, Brockton Family 
Services, DMH Disaster Mental Health Committee, Boston Children's Services, and Mothers 
Against Drunk Driving (MADD). The Division also provided training at several training 
programs sponsored by the Massachusetts Office for Victim Assistance (MOVA). These 
included the February, 1998, orientation program for VOCA-fimded victim service programs, 
two training programs for police-based domestic violence advocates held in July and 
December, 1997, and the May, 1998, MOVA Statewide Victim Advocate Training. These 
efforts yielded more referrals from health care and victim service professionals, and led to a 
significant increase in the number of domestic violence victims served by the program. 

In addition to posters, the Division produced over 50,000 wallet-sized informational 
pocket cards. These cards were specially designed to provide police officers and others a 
simple and effective way to make referrals to victim compensation. 

The pocket cards, along with posters and other materials, were distributed to every 
police department throughout the state. Many departments responded to the mailing by 
requesting additional materials. Several departments also requested and received in-house 
training. These included police departments in Lowell, Medford, Gardner, Canton, Stow and 
at Tufts University. 

Materials were also sent to prosecution-based victim/witness programs in each of the 
eleven district attorneys' offices, as well as to the United States Attorney for the District of 
Massachusetts. These offices have always been, and remain, the primary source of referrals 
to victim compensation. In-house training was offered to the victim/witness staffs in each of 



these counties, and was provided in most counties. In-house training was also provided to the 
Attorney General's office. 

This year the Division also produced applications in Spanish and Portuguese. These 
applications were widely distributed and have led to better services to, and communications 
with, non-English speaking crime victims. 

Aided by these materials, the Division made resources and information available to 
numerous other conferences and meetings throughout the state. These included the Attorney 
General's October, 1997, statewide domestic violence training conference for police, the 
November, 1997, New England Victim Services Training Conference, the Attorney General's 
Safe Schools Conference held in December, 1997, the statewide Victims Rights Conference 
held in April, 1998, and the statewide prosecutors domestic violence training conference held 
in May, 1998. The Division also distributed posters, applications and other materials at each 
of the regional "Working Together For Children Who Witness Domestic Violence" training 
initiatives held throughout the year in Berkshire, Middlesex, Essex, Worcester, Franklin and 
Hampshire, Suffolk and Hampden counties. 

Finally, this year, the Division made special efforts to provide immediate services to 
the families of homicide victims. These cases present special challenges in that, oftentimes, 
fiineral arrangements caimot be made until there is a guarantee of payment. If the Division is 
able to become involved at the outset, it can work directly with the funeral home to help 
arrange and pay for fiineral and burial services, thereby alleviating a major source of concern 
for families. 

To accomplish this goal, the Division first met with a group of homicide survivors to 
hear their concerns and priorities. It then met with the Office of the Chief Medical Examiner, 
providing applications, posters and other materials. This effort was designed to ensure that 
family members are always provided information about victim compensation at the time they 
identify the body of their loved one, and begin the process of making funeral arrangements. 
The Division also met with representatives of prosecutors' offices to ensure prompt receipt of 
the investigatory documentation needed to establish eligibility. 

Finally, the Division worked with the Massachusetts Funeral Directors Association to 
reach its member organizations. As a result of this collaboration, the Division published 
"Victim Compensation: Helping Survivors Pay for Funeral and Burial Expenses" in the 
December, 1997, edition of the MFDA newsletter. The newsletter was distributed, along 
with sample applications, to each of the 500 funeral homes in operation throughout the state. 
This outreach has led to more referrals directly from funeral homes. 

Automation : This year the Division invested significant time and effort in the design 
and development of an automated claims processing system. Using administrative firnds 
made available through VOCA, it contracted with IBM/Rave Software Solutions for the 
development of a LotusNotes based case management system. The system is designed to 
automate and integrate existing manual processes, to improve record keeping, and ultimately 
to permit integration between functions performed by the Division and those performed by 
the Office of the State Treasurer. At year end, the Division had just begun using the system, 
with good initial results. 



164 



Program Evaluation : In the final months of 1 997, the Division began soliciting 
feedback from victims and families who apply for victim compensation. Through the use of 
a survey included with all decision letters (both awards and denials), the Division inquired 
about issues relating to the ease and speed of the application procedure, the scope and quality 
of services provided by the program, and other matters. At the close of 1998, survey 
responses for the preceding twelve months were compiled and analyzed. The results provide 
the first clear picture of victims' experiences with the victim compensation program since it 
was removed from the district courts. 

Based on a return rate of 28%, applicants provided overwhelmingly positive 
responses to the questions posed by the survey. The percentage of applicants who "agreed" 
or "strongly greed" to the survey questions applicable to their claims were as follows: 
•The application was easy to fill out. 96% 

•The letters I received were easy to understand. 96% 

•My phone calls were returned promptly. 94% 

•The program staff treated me with courtesy and respect. 98% 

•My questions and concerns were answered. 97% 

•I received appropriate referrals to other programs. 90% 

•I understood what information was needed to reach a decision. 97% 

•I was satisfied with the amount of time it took to decide my claim. 93% 

•I was satisfied with the decision on my claim. 91% 

The written comments of applicants were also overwhelming positive. The following 
examples are typical: 

• Thank you to everyone who helped on my claim. The application is 
probably the easiest and most straightforward government form I've 
ever seen. Everything went smoothly and everyone was very helpful. 

• I can't say enough about my appreciation for this help. I have always been 
treated with dignity and respect when dealing with Victim Compensation. 

• Your office was exceptional in aiding me and answering my questions. 
Even though this was a very upsetting time for me and my family our 
fears were eased by your staff of wonderfiil, compassionate people. 

• I'm glad that ther? is such a program that helps the victim instead of 
the criminal. It feels like victims have no rights and criminals have all 
the rights. Thank you again for helping me. 

• Their handling of such delicate and emotional issues with dignity, 
respect and caring is outstanding, which makes horrifying 
circumstances just a little easier to bear. Thank you. 

• Class act! I was treated like I was the only case they had. It seems to 
me there is not much room for improvement. I thank you so much for 
the help. 

• I had to make one phone call and the rest was done through the mail. 



if;<; 



• Everything was very clear and the steps were easy to follow. This really will 
help to ease the financial burden, as I have struggled for a long time to keep 
my son in counseling. 

Le gislative Activity : Working with advocacy organizations, service providers, crime 
victims, the Massachusetts Office of Victim Assistance and others, the Division actively 
sought passage of S. 849, "An Act To Further Amend The Victim Compensation Law." This 
bill, filed by Senator William Keating and Representative Sal DiMasi, would expand certain 
key benefits currently available under G.L. c. 258C, while legislating certain cost-saving 
measures in the payment of medical bills. Specifically, the bill would permit the program in 
eligible cases to pay for: 

• mental health counseling expenses for non-offending 
family members of sexual assault victims; 

• the cost of cleaning the crime scene, if the crime occurred in 
the victim's home or car; 

• the cost of replacing the victim's clothing, bedding or 
other personal items held by law enforcement officials 
for evidentiary purposes; 

• the cost of replacing the victim's locks, if the crime 
occurred in the victim's home; 

• moving expenses to protect a victim fi-om continuing 
harm by the offender; and 

• ancillary expenses related to the death of a victim, 
including travel expenses to identify the body or to 
attend the funeral, or lost wages to attend the trial. 

Despite the pressing need for this assistance, and despite the Division's demonstrated 
success at reducing expenditures in the face of increasing claims, S. 849 was not enacted into 
law by the end of the year. After being included as an outside section to the Senate version 
of the budget, it was held in the budget conference conmiittee. In the final days of the 
session it passed the full Senate, and was referred to the House where it remains in the Ways 
and Means Committee. Passage of this important legislation will remain a top priority in the 
year ahead. 



166 



PUBLIC PROTECTION BUREAU 

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

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. 

The Bureau also has an office of the Legislative Liaison, who coordinates testimony 
for hearings before the Legislature on issues of concern to the Bureau. This past year, the 
Bureau testified on a variety of legislative items, including: (1) medical records 
confidentiality; (2) access for individuals with disabilities; (3) criminal background checks 
for home health care providers and nursing facility employees; (4) establishment of a registry 
of abusive home care providers; (5) health warnings on the advertising of alcoholic 
beverages; (6) health insurance benefits for domestic partners of public sector employees; (7) 
clarifying the laws on the solicitation of charitable donations; (8) electronic shelf pricing; (9) 
extended warranties; (10) community reinvestment by insurance companies; (1 1) health club 
industry practices; (12) telemarketing fraud; (13) banning assault weapons; (14) automatic 
teller machine surcharges; and (15) creating buffer zone aroxmd reproductive health facilities. 
The Legislative Liaison continues to monitor legislation that impacts the work of the Bureau. 

The Public Protection Bureau continued its charge of coordinating efforts and taking 
the lead in the priority areas of elder issues and health care. The Bureau continued its work 
with the Attorney General's Home Care and Home Health Care Task Force working on ways 
in which the laws, regulations and business practices of the home care and home health care 
industries in Massachusetts can be standardized to ensure the delivery of quality, reliable care 
to home health and home care patients. This working group is comprised of representatives 
of consumer advocacy groups, the home care and home health care industries, government 
agencies and parents with disabled children and others who require home health and home 
care services. As a result of the task force's work, the Attorney General filed a 
comprehensive legislative package to (1) amend the Criminal Offender Record Information 
(CORI) statute for home health care and home care employees and volunteers; (2) provide 
home health care and home care employers with immunity for sharing information regarding 
former employees; (3) establish a registry of home health workers; and (4) establish 
procedures for reporting and investigating allegations of abuse, neglect, mistreatment and 
misappropriation of home care consumers' property. In addition, the Attorney General filed 
legislation that would require home health agencies to be licensed. 

The Bureau also represented the Attorney General on the Nursing Homes Admission 
Contract Task Force, created to address findings that some nursing facility admission 
contracts failed to comply with regulations promulgated by the Attorney General and the 
federal government. 



lti-7 



The Bureau conducted a "sting" to check compliance by home health care agencies 
with the Criminal Offender Record Information (CORI) statute, which was amended last year 
to include home health care and home care employees and volunteers. Fifty home health and 
home care agencies representing a cross-section of all the counties in the state were chosen 
randomly from the telephone book, and the sting revealed that all fifty agencies are in 
compliance with the CORI statute. 

The Bureau also worked on the national level to try to alleviate the adverse impact of 
the federal Balanced Budget Act of 1997 (BBA) on the delivery of home care and home 
health care to elderly and disabled patients, including: (1) testifying in Washington, D.C. on 
the problems facing homeboimd Massachusetts patients receiving care as a result of the 
BBA; (2) leading the drive for a sign-on letter with 1 8 other state attorneys general 
supporting federal legislation; and (3) testifying before the state Legislature on the need to 
assist the home health industry in resolving the harmful effects of the BBA on the provision 
of home health care services to the state's elderly and disabled citizens. 

The Bureau advanced its priority in the guardianship area by continuing to participate 
as a member of the Massachusetts Guardianship Task Force and the Committee on 
Guardianship Reform. As a Massachusetts Guardianship Task Force member, the Bureau 
testified before the Legislature in support of legislation to establish a public guardianship 
commission and reform the guardianship statutes. The Bureau also assisted the Committee 
on Guardianship Reform, which includes the Attorney General, probate judges, elder and 
disabled persons advocates and private bar attorneys, on drafting and filing in the Legislature 
Article 5 of the Uniform Probate Code to revise the state guardianship laws. 

The Steering Committee of the Inter- Agency Task Force on Long Term Care 
Financing also includes various Bureau assistant attorneys general. The purpose of this task 
force is to study and develop alternative private financing methods for nursing home and 
other long-term care with a goal of providing financial security to elders and easing the 
burden on Medicaid. The task force is an outgrowth of an interagency workgroup on long- 
term care financing that met for over a year and produced A Preliminary Report: Alternatives 
for Improving Private Financing of Long-Term Care in Massachusetts. This bi-partisan task 
force is headed by the Acting Governor and the Attorney General and includes 
representatives fi^om the Division of Medical Assistance, Division of Insurance, Executive 
Office of Elder Affairs, the insurance industry, health care and long term care providers, and 
consumer and legal advocates. This year, the Bureau published Long-Term Care Financing: 
Now is the Time to Plan, a guide to plarming for long term care and shopping wisely for long 
term care insurance. 

The Bureau set up the Elder Law Advocates Strike Force in the last quarter of fiscal 
year 1998, to deal with elder issues generally but particularly to respond to matters arising 
fi-om the Office's operation of the Elder Hotline, 1-888-AGELDER. The helpline was set up 
in the Regulated Industries Division in June 1997, with the goal of helping elders and their 
families with elder issues and problems. The helpline is staffed primarily by trained elder 
volunteers. Over the course of the first nine months, it became apparent that greater law 
enforcement and investigative expertise was needed on an organized basis to assist the elder 
volunteers in the help that they provide to elders and their families. 



168 



The Elder Strike Force is a cadre of trained Assistant Attorneys General, 
investigators and paralegals available to handle elder related cases and assignments. Nine 
AAGs, 5 investigators, 2 paralegals, a health policy analyst and a community liaison 
coordinator went through a two day training course, presented by 9 AAGs who already 
participate in elder issues within the Ofifice. The training covered such matters as: Medigap 
insurance; health care consent issues; long term insurance; nursing homes; elder fraud. 

The coordinators of the Strike Force meet regularly to review cases and then assign 
the cases to members of the Task Force. Since its inception, the Elder Strike Force has 
reviewed and assigned almost 50 cases to members of the Strike Force - almost all of which 
were resolved by the end of the fiscal year. The majority of the cases reviewed by the Elder 
Strike involve allegations of abuse, financial ir physical abuse of elders. 

Some of the Bureau's other accomplishments in the health care area include 
publishing The Attorney General s Special Report on Medical Record Confidentiality. The 
report made recommendations including model security provisions for the protection of 
electronic medical records, protecting against discrimination on the basis of genetics, 
strengthening barriers between health care providers and commercial users of medical 
information, and increasing public input. The Bureau also published the Attorney General's 
Guide to Drawing Cash from Your Life Insurance Policy and distributed the brochure state-wide 
to AIDS service organizations and hospices. This guide explains how terminally and 
chronically ill persons can access the proceeds of their life insurance policies. 

The Bureau continues to be actively involved with consumer issues and this year 
continued its participation with the American Association of Retired Persons (AARP) in 
various initiatives, including serving on the Senior Health Care Coalition, a consortium of 
consumer groups that has worked with the Division of Medical Assistance and Executive 
Office of Elder Affairs on drafting the MassHealth Senior Care Options (SCO) proposal for 
dually eligible senior citizens to the Health Care Financing Administration. The Bureau also 
increased its efforts over the past year to prevent telemarketing fraud, through consumer 
education targeted at elders and increased investigative coordination with federal, state, and 
Canadian law enforcement agencies. 

The Public Protection Bureau also has a liaison to the lesbian and gay community 
who serves as a point of intake and outreach on lesbian and gay issues. The liaison convenes 
quarterly meetings with an advisory group of lesbian and gay law enforcement advocates to 
discuss issues and concerns of mutual interest. The Attorney General's gay liaison also 
coordinates testimony for legislative hearings on gay issues and serves as a member of 
Attorney General Harshbarger's Workforce Diversity Committee, which was created to 
promote dialogue and identify strategies for addressing workplace diversity issues. 

The Bureau also oversees implementation of the Attorney General's Community 
Benefits Guidelines for Hospitals and HMOs. During the 1 998 fiscal year, the Bureau 
together with AAGs in the divisions of Public Charities and Consumer Protection and 
Antitrust provided guidance to HMOs and hospitals in their completion of their annual 
community benefits reports, analyzed those reports, and authored the Attorney General's 
reports on the status of both Hospital and HMO Community Benefits Programs. This work 
will continue in future fiscal years. 



if;Q 



The Bureau also oversees the Attorney General's Advisory Task Force on Hospital 
and HMO Community Benefits, which was convened in June 1 998 for the purpose of 
advancing the goals of the Community Benefits Guidelines. This Task Force includes 
representatives of hospitals, HMOs, community health advocacy groups and relevant state 
agencies, and will be very active during the next fiscal year. The Task Force is planning a 
major conference on Community Benefit "best practices" to be held in October 1998. 

The Bureau also has a representative on the Statewide Clinic Security Task Force, and 
handles matters with respect to maintaining safety around reproductive health clinics. This 
year, the Task Force convened in response to the bombings at clinics in Atlanta, Georgia. 
The Bureau also trained security officers at a local hospital in how to respond to protestors. 

Public Protection Bureau staff are also very active in public speaking and educational 
outreach efforts on behalf of the Attorney General. AAGs speak frequently to elder, 
business, civil rights, health care and consumer audiences, as well as appearing on numerous 
television and radio segments and news stories. In addition, since 1992 the Bureau Chief has 
appeared weekly on WCVB-TV's noontime consumer call-in segment. 

CONSUMER PROTECTION AND ANTITRUST DIVISION 

The Consumer Protection and Antitrust Division enforces Massachusetts General 
Laws 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 outreach, and mediating individual 
complaints through the Consumer Complaint and Information Section and the Local 
Consumer Programs. 

In fiscal year 1998, the Division obtained judgments or entered into settlements for 
the following amounts: 

CIVIL PENALTIES/ATTORNEYS' FEES/COSTS $2,881,327 

CONSUMER RESTITUTION $9,083,105 

LOCAL CONSUMER AID FUND $ 312,500 



170 



The following are examples of cases brought by the Division: 

ANTITRUST 

Comm. et al. v. Toys "R" Us. Inc. et al. 

In November 1997, Massachusetts and 37 other states filed an antitrust suit in the 
U.S. District Court for the Southern District of New York, alleging that Toys "R" Us, Inc. 
successfully conspired with Mattel, Inc., Hasbro, Inc., Tyco Industries, Inc., The Little Tikes 
Company, Inc., and others to prevent the sale of many popular toys in warehouse clubs. 

The states allege that the low toy prices of the warehouse club stores put competitive 
pressure on Toys "R" Us, threatening its image for everyday low prices. In response. Toys 
"R" Us allegedly used its power as the largest toy retailer in the United States to gain 
agreements with the defendant manufacturers to limit toy sales to the clubs. 

The suit seeks recovery of treble damages, civil penalties and costs as well as 
injunctive relief prohibiting wrongfiil conduct. 

Comm. et al. v. Microsoft 

In May 1998, Massachusetts and 20 other states filed a federal antitrust lawsuit 
alleging that Microsoft Corporation has illegally and deliberately restricted consumer choice, 
squelched competition and undercut innovation in the nation's computer software industry. 
In a coordinated and parallel action, the U.S. Department of Justice also filed a similar 
lawsuit in U.S. District Court in Washington, D.C. 

The complaint alleges that Microsoft is attempting to stifle competition with other 
browsers by "tying" its browser to the Windows 98 system and by engaging in a series of 
exclusionary and anti-competitive acts to protect its Windows operating system monopoly 
and prevent consumer choice in other software markets ~ especially the Internet browser 
market. The complaint alleges that Microsoft used its market monopoly to make deals with 
computer makers and online services that illegally give Microsoft products an unfair 
competitive advantage over smaller software makers. 

AUTOMOBILES 

Comm. V. Guy Axell Emmanuel 

In July 1997, CPAD filed a consent judgment in Middlesex Superior Court against 
Guy Axell Emmanuel, a Medford auto shipper. In a complaint filed earlier, CPAD alleged 
that Emmanuel left 1 80 cars and trucks on the state pier in Fall River after collecting 
thousands of dollars in shipping fees to ship the vehicles to Haiti. 

The consent judgment required Emmanuel to pay $235,000 in restitution to 
consumers and $10,000 in penalties. 

Comm. V. Sullivan Brothers Toyota, Inc., et al. 



171 



In December 1997, CPAD filed an assurance of discontinuance in Suffolk Superior 
Court against Sullivan Brothers Toyota, Inc. and Sullivan Brothers Chrysler-Plymouth- 
Dodge, Inc., based on conduct of two acquired dealerships, Tom O'Brien Toyota and Tom 
O'Brien Chrysler-Plymouth-Dodge. The Commonwealth alleged that the dealerships made 
misrepresentations regarding cars for sale or their ability to get a consumers' suspended 
license reinstated if he purchased a car. 

The consent judgment required the dealerships to refimd all costs and assume credit 
obligations of consumers who were allegedly sold vehicles based on certain dealer 
misrepresentations. 

Comm. V. Riverside Kawasaki 

In March 1998, CPAD filed a consent judgment in Middlesex Superior Court against 
Riverside Kawasaki to resolve allegations that the dealership signed consumers' names to 
rebate claim forms without their knowledge or consent and directed the rebates to the 
dealership. 

The consent judgment required the dealership to refiond the rebates to consumers, to 
refi-ain fi-om making any misrepresentations about rebates in the future, and to pay $12,000 in 
civil penalties. 

Comm. V. Charles Daher's Commonwealth Motors. Inc.. et al. 

In March 1998, CPAD filed a consent judgment in Suffolk Superior Court against 
Charles Daher's Commonwealth Motors. The dealership allegedly told consumers that 
deposits would be refiindable but later refused to return deposits, refused to honor warranties 
on used cars, made changes to documents after they were signed by consumers, and failed to 
disclose that advertised cars were used former rental cars. 

The consent judgment required the dealership to refimd deposits to consumers from 
whom they were allegedly improperly withheld, to make efforts to satisfy all other pending 
consumer complaints, and submit to binding arbitration if consumers were not satisfied. 
Total restitution under the agreement will exceed $25,000. In addition, the judgment 
prohibits Commonwealth Motors from withholding consumers' deposits in the future and 
requires the dealership to refi-ain fi-om future misleading advertising. The consent judgment 
also required Commonwealth Motors to pay $62,500 as civil penalties and $12,500 to the 
Attorney General's Local Consumer Aid Fund. 

Comm. V. Silver City, Inc. 

In June 1998, CPAD filed suit in Bristol Superior Court against Silver City, Inc., 
alleging that Silver City committed various unfair and deceptive acts or practices in 
coimection with the advertising and sale of new and used motor vehicles. The 
Commonwealth alleges that Silver City failed to disclose material information to consumers 
about motor vehicles offered for sale, induced consumer to sign blank financing documents, 
misrepresented to consumers the monthly payment amount the consumer would be required 
to pay to finance the purchase of a motor vehicle, failed to execute an assignment and 



172 



warranty of title on the day the vehicle was delivered to a consumer, and engaged in false and 
deceptive advertising of motor vehicles offered for sale. 

The Commonwealth's complaint seeks restitution for affected consumers, injunctive relief 
barring conduct of the type alleged, and civil penalties in the amount of $5,000 per violation. 

COMPUTER CASES 

In the Matter of America Online 

In May 1998, Massachusetts and 43 other states reached a sweeping nationwide 
settlement with America Online ("AOL"). The settlement resolved several pending issues 
and concerns states had with AOL and was the third agreement between the states and the 
nation's largest online provider. 

The settlement requires AOL to provide clear and conspicuous notice of any monthly 
fee increases or contract modifications at least 30 days in advance; to make new disclosures 
regarding its "free trial" program; to notify all consumers, via pop-up screen, when they enter 
a service area where charges are incurred beyond the monthly fee; and to provide improved 
online tools to prevent unauthorized purchases. 

In addition, AOL agreed to pay the 44 states a combined $2.6 million for legal costs 
and future consumer protection and education efforts. 

Comm. V. AKOA. Inc.. et al. 

In November 1997, CPAD filed a complaint in Suffolk Superior Court, alleging that 
AKOA, Inc., doing business as National P.C. Systems, and Rayco, Inc., doing business as 
Checkwriter Systems, sent solicitations made to appear as invoices for existing agreements to 
Massachusetts consumers, churches and small businesses for non-existent computer 
maintenance agreements and check writing machine service agreements. The complaint also 
alleges that the companies use a Boston mail-drop, and refused all requests for refunds from 
consumers who have been deceived by the solicitations. 

The Commonwealth is seeking restitution for consumers, payment of a civil penalty, 
and injunctive relief. 

FINANCIAL AND DEBT COLLECTION 

Comm. V. Commonwealth Capital Funding Corp., et al. 

In August 1997, CPAD filed suit in Suffolk Superior Court and obtained a temporary 
restraining order against Commonwealth Capital Funding Corp., a "home-buying assistance" 
company that was allegedly taking large fees from consumers to help them buy homes, and 
then never provided the service. As many as 200 consumers, many with limited incomes, 
paid CCFC fees between $1500 and $5400 for services that were allegedly never provided. 
Also named in the suit were the principals of the company, Steve Mueffelman, John 



17^ 



Lombardi and Richard Lahar, as well as an affiliated company, United American Real Estate 
Corp. 

The temporary restraining order prevented the defendants from removing any assets 
from the state, dissipating any funds paid by consumers to CCFC, or removing or destroying 
any company documents. 

In the Matter of Staples. Inc. 

In August 1 997, Massachusetts and twelve other states entered assurances of 
discontinuance against Westborough-based Staples, Inc. to resolve allegations that the office 
supply chain did not disclose all of the important terms in its zero interest financing 
programs. 

The assurance required Staples to provide clearer explanations of the terms of its 
"zero percent financing" agreements in its advertisements and to disclose the annual 
percentage rate that will be assessed if the consumer does not comply with all of the terms of 
the finance program. In addition. Staples was required to pay a total of $80,000 to the states 
for attorneys fees and costs. Massachusetts received $10,000 of the $80,000. 

Comm. V. Sears, Roebuck & Co. 

In September 1997, CPAD filed a consent judgment with Sears that resolved the 
Commonwealth's claims against Sears, Roebuck & Co. for collecting debts in violation of 
the U.S. Bankruptcy Code and state consumer protection law. Massachusetts led a group of 
all 50 States Attorneys General in negotiating the final nationwide settlement. The states 
allege that Sears, by threatening to repossess consumer goods, pressured consumers to make 
payments on debts even after the debtor was discharged in bankruptcy, and obtained the 
payments without the knowledge of the Bankruptcy Court. 

Under the nationwide settlement. Sears is required to forgive up to approximately 
$125 million in consumer debts improperly obtained by Sears, to repay at least $125 million 
in compensation to affected customers, including interest and to change certain of its 
collection practices. In addifion. Sears was required to pay $35 million to the States, as well 
as $5 million to benefit consumer education. Massachusetts received approximately $2.37 
million in civil penalties and payments to local consumer protection programs and other 
Massachusetts programs. Restitution to the approximately 9,900 Massachusetts consumers is 
expected to be paid by the end of the year and likely will reach $8.45 million. 

Comm. V. National Affordable Housing Coalition, Inc. 

In October 1997, CPAD filed a complaint and obtained a temporary restraining order 
that prevented a Reno, Nevada corporafion. National Affordable Housing Coalition, Inc., 
from conducting its "Home Buying Seminars," and otherwise acting as a mortgage broker 
without an appropriate license to do so in the Commonwealth. In addition, the restraining 
order prevents two Massachusetts businesses. Viking Mortgage Company, LLC and Leonard 
Cercone, d/b/a Interstate General Mortgage Co., from acting as mortgage lenders in the 
Commonwealth without appropriate licenses in the Commonwealth. 



174 



Comm. V. Capital Recovery Services. Inc. 
Comm. V. Client Services 

In December 1997, CPAD obtained consent judgments against Capital Recovery 
Service, Inc., based in Fairfax, Virginia, and Client Services, based in St. Charles, Missouri, 
two debt collection operations which illegally attempted to collect debts from Massachusetts 
consumers. The collection agencies were not licensed by the Division of Banks to do 
business in Massachusetts. 

The consent judgments, which were filed in Suffolk Superior Court, prohibit the debt 
collection agencies from collecting from Massachusetts consumers unless and until they 
obtain a license from the Divisions of Banks and file a bond with the State Treasury. The 
judgment also forbids the debt collection agencies from violating Massachusetts collection 
agency laws and regulations, and from violating any orders from the Commissioner of Banks. 
In addition, the consent judgment requires Capital Recovery Service to pay $5000 in civil 
penalties and Client Services to pay $2,500. 

Comm. v. Noble Ventures Corporation 

In February 1998, CPAD entered into a consent judgment requiring a New York asset 
search firm. Noble Ventures Corporation and its president Robin Lahiri to pay $35,000 in 
civil penalties and costs, and to cease its trade in private financial information. 

In a complaint filed in November 1997, CPAD alleged that Noble Ventures 
Corporation and Robin Lahiri committed over 1 000 violations of state consumer protection 
and privacy laws by tricking banks into releasing private bank account information, including 
specific balances. Noble Ventures would then disclose the information to creditors, 
estranged spouses, or others who hired the company to conduct an asset search. 

Because the defendants also claimed to specialize in hiding assets, CPAD requested 
and obtained a freeze on up to $50,000.00 in an account at the company's Massachusetts 
bank to ensure that ftrnds would be available if the court imposed penalties. 

Comm. V. Source One Associates. Inc., et al. 

In February 1998, CPAD filed suit against Source One Associated, Inc., an asset 
search company, and its president, Peter Easton. The Commonwealth alleged that the 
defendants violated privacy and consumer protection laws by using ruses and deception to 
trick banks into releasing confidenfial information, such as bank account balances, to them. 

The Commonwealth is seeking permanent injunctive relief, full restitution for 
affected consumers and civil penalties and costs. 

Comm. v. Asset Searches Plus, et al. 

In February 1998, CPAD obtained an assurance of discontinuance against Asset 
Searches Plus and its principal, Edward Amaral, Esq., to resolve allegations that the 
defendants obtained and disclosed financial information, such as bank and brokerage account 
balances of others in violation of state privacy and consumer protection laws and regulations. 



175 



The assurance bars the defendants from seeking or disclosing financial information of 
a consumer unless the account stands in the name of the person to whom the information is 
disclosed or the written consent of the person or entity that owns or holds the account is 
obtained. It also enjoins them from making any false representations in an attempt to obtain 
financial or insurance information concerning any other person. In addition, the defendants 
were required to pay $5,000 to the Local Consumer Aid Fund 

Comm. V. Location and Discovery Services 

In February 1998, CPAD filed suit and obtained a preliminary injunction in the 
Suffolk Superior Court to stop Location & Discovery Services, Inc., a Louisiana firm, from 
using deceit to obtain private bank account information, and selling that information to 
others. 

The complaint alleged that the defendant secretly obtained private financial 
information, such as bank account balances, of numerous Massachusetts residents, and sold 
that information to others. The preliminary injunction required the company to halt the 
practice and to cease the use of deception to obtain such information until the case can be 
heard at trial. 

In the Matter of the Estate of Marion I. Cook 

In February 1998, after an eleven day trial, Steven Lyons agreed to a judgment to 
vacate the will of an elderly woman who left him an estate worth more than $225,000 even 
though she had known him only a few months and was more than 50 years older than the 
man. 

CPAD petitioned to vacate the will of Marion Cook alleging that Stephen Lyons 
failed to disclose to the Probate Court and to the Attorney General that the 78 year-old 
woman was incompetent at the time she signed her will. Lyons allegedly assumed total 
control of the elderly woman's affairs just a few weeks after her husband died in March 1989. 
In April 1989, during her hospitalization for a stroke, Mrs. Cook was evaluated by a 
psychiatrist and was found incompetent to write a will. Only two days later, and only one 
day after her discharge from the hospital, Lyons took the woman to his attorney where she 
executed a will naming Lyons as her executor and sole beneficiary. The woman died the 
following year. 

The Attorney General obtained a court order vacating the decree of Marion Cook's 
will and ordering Stephen Lyons to return assets of her estate to a public administrator, who 
is appointed to administer the estates of persons who die without heirs at law and without a 
valid will. 

Comm. V. Federated Department Stores. Inc. 

In February 1998, CPAD entered into a consent judgment with Federated Department 
Stores, Inc., owner of Macy's, Bloomingdales, and other retail stores arising out of 
allegations that Federated had solicited customers who filed Chapter 7 bankruptcy to sign a 
contract agreeing to repay their debt rather than have it dismissed in bankruptcy. Federated 



176 



then failed to file those agreements with the Bankruptcy Court as reqitired by law. The 
practice had been going on for at least five years. 

The settlement required Federated to pay a total of $5.3 million to over 13,000 
consumers nationwide fi^om whom it collected invalid debts. Massachusetts consumers will 
receive approximately $139,500 in reimbursement by Federated. In addition. Federated will 
pay the states $2.7 million in civil penalties, costs, and to fund consumer protection and 
education programs with Massachusetts receiving $86,727, primarily in civil penalties. 

In addition. Federated is required to strike all "reaffirmed" debts for affected 
consumers and waive any rights to repossess the merchandise; reimburse or receive credit for 
finance charges, and penalties charged by Federated, and be reimbursed for any monies paid 
on the reaffirmed debt plus 10% interest; pay an additional $250,000 to be used to reimburse 
affected consumers based upon the amounts of payments a consumer made on an unlawful 
debt. 

Comm. V. Valerie Dutro d/b/a Private Investigative Services 
Comm. v. Bonnie Pomush 
Comm v. Integrity National. Inc. 
Comm. v. Henry Davis Consulting. Inc. 

In May 1998, CPAD filed consent judgments in Middlesex Superior Court against 
four "asset search" firms who allegedly used deceit to obtain private bank account 
information and sold that information to others. The defendants, Valerie Dutro d/b/a Private 
Investigative Services in Kansas City, Bonnie Pomush of Thousand Oaks, California, 
Integrity National, Inc. of Seattle, Washington, and Henry Davis Consulting, Inc. of Natick, 
contracted with Bearak Reports, a Framingham company, to secretly obtain private financial 
informafion, such as bank account balances, of numerous Massachusetts residents. 

Under the Consent Judgments, the defendants were required to pay a total of 
$60,000.00 in civil penalties and are barred from impersonating the targets of the "asset 
search," and deceiving banks into releasing private information about the targets' accounts. 
They are also barred fi-om obtaining or disclosing the financial information without the 
consent of the account holders. 

Comm. V. Robert Beal 

In June 1998, CPAD obtained a default judgment against Robert Beal, of Manchester, 
New Hampshire, requiring Beal to pay a civil penalty of $75,000.00 for obtaining and selling 
private bank account information, such as account numbers and balances. The Court also 
issued an injunction prohibiting Beal fi-om continuing the practice. 

CPAD alleged that Beal targeted consumers and banks in Massachusetts and 
elsewhere since at least 1 993 and obtained private financial information on over 500 
occasions. The information was then allegedly disclosed to attorneys, collection agencies, 
estranged spouses, or others. 

TOBACCO UNIT 



177 



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. 
Li ggett 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. 

In the last year, attorneys from CPAD and Special Attorneys General argued and won a 
number of critical motions in this case. In October 1997, the Court heard argument on several 
lengthy motions to dismiss the case filed by the cigarette company defendants. The Court 
refused to dismiss the case and ruled in favor of the Commonwealth on the central issues raised 
by the motions to dismiss. The Court also ruled against the defendants on their motions to 
prevent the Commonwealth from using Special Assistant Attorneys General, and to dismiss for 
failure to join indispensable parties. In March 1998, the Court also ruled in favor of the 
Commonwealth in declining to dismiss B.A.T. pic for lack of personal jurisdiction. 

As the litigation moved into the discovery phase, CPAD attorneys and Special Assistant 
Attorneys General responded to voluminous requests for the production of documents filed by 
the cigarette companies. Working with many state agencies, and in particular the Department of 
Public Health and the Division of Medical Assistance, the Commonwealth produced over 6 Million 
pages of documents in response to these requests. The Commonwealth also defended over 100 
depositions noticed by the defendants and answered numerous interrogatories. The defendants 
nonetheless argued to the court that this production was insufficient. They sought more 
information and an expansion of the deadlines in order to obtain it. The Commonwealth responded 
and successfully argued to the Court that the discovery produced was thorough and that no more 
time was necessary. 

While responding to the defendants' discovery, the Commonwealth performed its own 
discovery, filing requests for the production of documents, interrogatories, and taking 
depositions. The Commonwealth also sought the Court's ruling that numerous documents the 
defendants claimed are privileged are either not privileged, or should be released because 
they constitute evidence of the defendants' crime or fraud. The Court issued a number of 
favorable rulings "de-privileged" many of these documents. 

In June 1998, the Commonwealth produced to the defendants a list of more than 20 expert 
witnesses the Commonwealth plans to call to testify at trial. With each name the Commonwealth 
disclosed the experts' qualifications, and the nature of his or her expected testimony. 

The Court has scheduled trial in this case for February 1999. 

Tobacco Ingredients Disclosure Litigation 

With the Government Bureau, CPAD has continued its defense of the tobacco 
industry's challenge to the Massachusetts tobacco ingredients disclosure law. The law 
requires each tobacco products manufacturer to file, each year, with the Department of Public 
Health, a list of the non-tobacco ingredients in each brand it sells in the Commonwealth. The 
industry has asserted claims against the law under the Takings, Commerce and Due Process 
Clauses. On December 10, 1997, the US District Court entered a preliminary injunction 
against implementation of the law. The Commonwealth's appeal from that order was argued 
before the First Circuit on July 28, 1998. The parties also filed motions for summary 



178 



judgment in the case, which were argued before the District Court (O'Toole, J.) on May 7, 
1998. These motions are under advisement. Earher in the case, the 
District Court had found that the disclosure law is not preempted by the federal Cigarette 
Labeling Amendments Act (and the analogous federal law concerning smokeless tobacco 
products). That decision was affirmed by the First Circuit in August 1997. 

GENERAL 

Comm. V. United Buying Service of Massachusetts, Inc., et al. 

In August 1 997, CPAD filed suit in Suffolk Superior Court against United Buying 
Service of Massachusetts, Inc. ("UBSM") for allegedly engaging in high pressure sales 
tactics and misrepresenting the amount of savings and availability of products for consumers 
who paid fees ranging ft-om $1,100.00 to $1,599.00 to join UBSM's so-called "buying club." 
Mso named in the lawsuit was Phillip A. Gerber, the former president for UBSM. 

UBSM allegedly solicited consumers for "membership" by distributing lottery style 
'scratch" tickets which suggest that consumers could win $1,000 in cash. Consumers 
responding to such solicitations were informed that they must attend a sales presentation at 
:he offices of UBSM where salesmen for UBSM misrepresented the amount of savings 
:onsumers could achieve through membership, as well as the availability of brands and 
products. Salesman for UBSM also allegedly misrepresented to consumers that its buying 
:lub is "approved by the Better Business Bureau and other governmental organizations." 

The Commonwealth is seeking permanent injunctive relief, as well as restitution for 
:onsumers and costs for investigating and prosecuting the action, including attorneys' fees. 

Comm. V. Dryco, et al. 

In November 1997, CPAD filed a consent judgment against Dryco, Inc. and its 
Dwner, Khaled Mansour to resolve allegations that they sold fake identification cards to 
ninors who stated that they would use the cards to obtain alcoholic beverages. The 
identification cards allegedly resembled official identification cards and driver's licenses. 

The consent judgment required the defendants to pay a civil penalty of $5,000.00 and 
prohibiting them from selling identification cards to anyone under the age of 2 1 . 

Comm. V. Windsor of Dracut. Inc.. et al. 

In September 1997, Suffolk Superior Court Judge Peter M. Lauriat ruled in favor of 
the Commonwealth following a bench trial against John N. Maraganis, one of the former 
owners of the Windsor Mills Restaurant in Dracut, Massachusetts. The judgment required 
the defendant to pay fiill restitution to all injured consumers, the payment of a civil penalty to 
the Commonwealth and imposition of injunctive relief 

The customers of Windsor Mills were mostly brides-to-be who planned to hold their 
wedding receptions at the popular spot in Dracut. They paid deposits ranging from $750 to 
Bl ,000 to Maraganis who was the general manager or to members of his staff When the 
restaurant closed abruptly in July 1994, following a mortgage foreclosure sale of the 



179 



restaurant premises, more than 70 customers had lost a total of at least $45,000 in unretumed 
deposit funds. 

The judgment allowed the Attorney General's Office to present evidence of losses 
suffered by consumers- victims in addition to the six (6) consumers who testified at trial. 
CPAD estimates that the total sum of restitution for all victims is $45,000. 

Comm. V. U-Haul 

In September 1997, CPAD entered into a settlement filed in Suffolk Superior Court 
wdth U-Haul International, Inc. and regional U-Haul companies to resolve allegations that U- 
Haul rented defective trucks to consumers, misled consumers about "guaranteed" truck and 
trailer reservations, misrepresented the security of consumers' property in U-Haul storage 
units, charged excessive late fees for storage rental, and violated the state Self-Storage 
Facilities Act in enforcing liens against storage customers who fell behind in rental 
payments. 

Under the settlement, which is contained in a Consent Judgment and an Assurance of 
Discontinuance, U-Haul is required to pay $1 55,000 to the Commonwealth's Local 
Consumer Aid Fund, and to pay restitution through an arbitration program to consumers who 
lost money due to U-Haul' s practices. The settlement also required U-Haul to not make any 
representation that reservations of its equipment are "guaranteed," or any deceptive claims, 
such as "best security," about the security of its storage facilities. U-Haul also must refrain 
from renting any equipment that is likely to cause an accident or break down, reduce its 
storage late fee charges, and end its practice of charging "inventory fees" to consumers who 
are behind in their storage rental payments. 

Comm. V. Direct Marketing Ltd.. et al. 

In September 1997, CPAD entered into a consent judgment in Suffolk Superior Court 
with Raffoler Ltd. and Direct Marketing Enterprises Ltd., both doing business as CVP 
Sweepstakes and their owners/operators, Jerry Williams and Stephen Brown. The consent 
judgment resolved allegations that Raffoler Ltd. and Direct Marketing Enterprises Ltd. 
mailed more than 3 million unsolicited sweepstakes award promotions a year which misled 
Massachusetts consumers into believing that they had won cash and substantial sweepstakes 
prizes, and would be likely to win more prizes if they bought certain products. 

The consent judgment required the defendants to pay $100,000 to the Attorney 
General's Local Consumer Aid Fund, modify their sweepstakes solicitations and provide 
Massachusetts consumers with complete refiinds in order to settle a lawsuit brought by his 
office. In addition, they are prohibited from requesting consumers' social security numbers 
or date of birth unless the words "optional [voluntary] [not required]" in bold or italic type 
immediately precede or follow the request for such information. Raffoler Ltd. and Direct 
Marketing Enterprises Ltd. are further required to establish and implement procedures to 
suppress solicitations from being sent to Massachusetts consumers who have asked to be 
removed from Raffoler' s and Direct Marketing Enterprises' mailing lists. 

Comm. V. Daniel Buck d/b/a Clearinghouse Publications 



180 



In September 1 997, CPAD obtained a consent judgment against Daniel Buck, 
individually and doing business as Clearinghouse Publications, who allegedly charged 
hundreds of consumers, including Massachusetts residents, for nonexistent "work-at-home" 
opportunities. 

The consent judgment, which was filed in Suffolk Superior Court, prohibits Buck 
from continuing to place deceptive advertisements and collecting fees for nonexistent 
"work-at-home" opportunities. The judgment also forbids Buck from going back into the 
home employment business under any circumstances for the next ten years. In addition, the 
consent judgment requires him to return $10,000 to injured consumers. 

Comm. V. Vacation Break. U.S.A.. Inc. 

In September 1997, Massachusetts and 10 other states entered into a consent 
judgment with Vacation Break, U.S.A. Inc., one of the leading sellers of discount 7 day/6 
night vacation packages to Florida and the Bahamas. 

The states alleged that Vacation Break solicited consumers by sending out official- 
looking "certificates" which lead consumers to believe they had won a promotional vacation 
package. After calling a toll-free number, the consumers learned that there is a cost 
associated with the "free" vacation package. There was also generally a requirement that 
consumers tour the defendant's time-share resort in order to take advantage of the vacation 
package. The vacation packages typically cost around $400.00 to $500.00 without air fare to 
Florida. 

The Consent Judgment permanently prohibits Vacation Break from misrepresenting 
various terms and conditions of its vacation "packages" and from failing to disclose in its 
solicitations several important terms and conditions of its offer. The judgment also requires 
Vacation Break to affirmatively disclose, in any solicitation, all costs and fees and other 
important terms and conditions of the vacation package in ways that will be more clear to 
consumers. 

The judgment also established a Consumer Restitution Fund in the amount of 
$225,000 for refunds to eligible consumers in the 1 1 states that negotiated the agreement. In 
addition, the agreement required Vacation Break to pay the Commonwealth $25,000 in civil 
penalties and costs. 

Comm. V. Robert Mattson d/b/a Ice Center Promotions 

In December 1997, CPAD obtained a default judgment against Robert Mattson d/b/a 
Ice Center Promotions, that resolved allegations that Mattson sold sports memorabilia 
adomed with forged signatures of New England Patriots quarterback Drew Bledsoe. 

Under the terms of the judgment, Mattson is required to take precautions to ensure 
that all merchandise he sells in the future is authentic. He is also forbidden from 
misrepresenting the nature of his wares, or otherwise facilitating the sale of forged goods. In 
addition, he was required to pay a $6,000 penalty, and must reimburse the Commonwealth 
$1,600 in investigative costs and expenses. 

Comm. V. Hide-A-Way Health Club, Inc., et al. 



181 



In December 1997 and February 1998, CPAD entered into consent judgments in 
Middlesex Superior Court with Hide-a-Way Health Club, Inc., an unbonded Pepperill health 
club that abruptly closed its doors without any prior notice to its members and without 
refimding membership fees owed to consumers, and its co-owners Leann M. Kelley and 
Carol J. Fosdick. 

In a complain filed in June 1997, CPAD alleged that the defendants engaged in false 
and deceptive advertising and sales practices that misled consumers to pay advance 
membership fees and to sign up for health club services which defendants knew they would 
not provide. 

Under the terms of the settlement, the defendants agreed to pay a total of $40,000 for 
restitution to over 500 Hide-A-Way members who were due refunds when the club closed. 
In addition, Fosdick and Kelley are barred from violating the Consumer Protection Act and 
regulations and Kelley is barred fi-om working in the Massachusetts health club industry for 
three years. 

In the Matter of Talk America. Inc.. et al. 

In January 1998, Massachusetts and 8 other states obtained assurances of 
discontinuance against Talk America, Inc., a Portland, Maine-based telemarketer that 
required the defendant to stop broadcasting and producing radio infomercials which advertise 
"miracle" health care products 

Talk America, Inc. allegedly violated various Consumer Protection Acts, as well as 
the federal Food, Drug and Cosmetic Act, in its advertisements for three products: 1) 
"Natural Hairs," which claimed to reverse male pattern baldness by releasing trapped hair 
follicles; 2) "Purifast 30", which consisted of a "Body Detoxifier" that purported to cleanse 
toxins from the body and "Colon Cleanser" which purported to flush trapped old fecal matter 
from the colon; and 3) Daily Harvest, which purported to replace fresh fruits and vegetables 
in the diet. Talk America did not have the scientific evidence or other substantiation to 
prove its claims for the three products. 

In addition to ceasing the advertisements, the agreement required the company to 
issue refimds to consumers in the nine states and to pay $150,000 for attorneys' fees and 
costs. 

In the Matter of DIRECTV. Inc. 

In January 1998, Massachusetts and 30 other states obtained assurances of 
discontinuance with DIRECTV, Inc., a satellite broadcasting service, to resolve complaints 
by consumers who pre-paid for a year of programming services, then were dissatisfied when 
DIRECTV changed the programming offered during that year. 

In Massachusetts, approximately 8,000 consumers participated in DIRECTV'S $200 
Cash Back Offer, wherein consumers who purchased a satellite system and prepaid for a year 
of certain programming services from DIRECTV received $200 off either the purchase of the 
satellite system or the cost of the annual programming services. Before all of the prepaid 



182 



subscriptions had expired, DIRECTV removed some of the channels included in the prepaid 
subscriptions, and replaced them with other channels. The channels that were removed, the 
Encore movie channels, were placed in a separate and more expensive program package. 

The agreement provides for consumers who were unhappy with the programming 
changes made by DIRECTV to receive the Encore movie channels for free for the remainder 
of the time they had left on their annual subscription as of the date DIRECTV made the 
programming changes in April 1997. In addition to the restitution available to Massachusetts 
consumers, the Commonwealth also received $28,000 to cover the costs of its investigation. 

Comm. V. Mark DeFonzo d/b/a A-1 Cape Appliance Repair 

In January 1998, CPAD filed a complaint in Barnstable County Superior Court and 
subsequently obtained a preliminary injunction against Mark DeFonzo d/b/a A-1 Cape 
Appliance Repair. The injunction prevented DeFonzo from taking part in an appliance repair 
business, destroying any documents related to the company or removing any money or assets 
fi-om Massachusetts during the pendency of the case. 

DeFonzo allegedly demanded service charges from consumers whether or not he 
performed a repair on a consumers' appliance. He also allegedly set up follow-up 
appointments to repair appliances after collecting the service fee and then never returned to 
perform the work or did return and did not fix the problem. DeFonzo also allegedly did not 
provide refunds to consumers even after he promised to pay the refunds. 

The Commonwealth is seeking restitution for consumers, payment of a civil penalty, 
and injunctive relief. 

Comm. V. Oriental Treasures. Inc. 

In February 1998, CPAD filed an assurance of discontinuance in Suffolk Superior 
Court against Oriental Treasures, Inc. to resolve allegations that Oriental Treasures, Inc. 
violated the Consumer Protection Act in its conduct of a termination sale. 

The assurance required the defendant to abide by the terms of the Removal or 
Termination Sale Statute and the Attorney General's Regulations in fiiture sales of goods in 
the Commonwealth, and pay a civil penalty of $1,000. 

Comm. V. Combined Publishers Service, Inc. d/b/a International Magazine Service of 
the Southeast 

In April 1998, CPAD filed an assurance of discontinuance with Combined Publishers 
Service, Inc. d/b/a International Magazine Service of the Southeast ("IMS") to resolve 
allegations that IMS failed to disclose, in the initial telemarketing call, the duration of the 
subscriptions and the total amount of the subscriptions purchased, refused to cancel 
subscriptions upon request, and made imauthorized charges to consumers' credit cards or 
bank accounts. 

The assurance requires IMS to refi^ain ft-om violating the FTC Telemarketing Sales 
Rule, the Massachusetts Consumer Protection Act and the Attorney General's Regulations. 
In addition, IMS was required to pay $2,500 to the Local Consumer Aid Fimd, $1,500 for 
costs of the investigation and $105.20 in restitution. 



183 



In the Matter of American Family Publishers 

In March 1998, Massachusetts along with thirty-one other states and the District of 
Columbia, entered into an agreement with American Family Publishers ("AFP") to end 
certain illegal sweepstakes promotion tactics. 

Under the terms in the assurance, AFP is prohibited from telling consumers that they 
are winners or have already won a prize unless they have in fact won a prize; telling 
consumers that they are members of a select or limited group with a favorable chance of 
winning a prize in a sweepstakes imless such representation is true and accurately describes 
the size of the group, and unless the statement explains the consumers' odds of winning the 
prize; and failing to tell consumers that no purchase is necessary to participate in the 
sweepstakes. 

In addition, AFP was required to pay the states a total of $1,250,000 - $50,000 of 
which went to the Massachusetts Attorney General's Local Consumer Aid Fund. 



In the Matter of TruGreen. Inc. 

In March 1998, CPAD filed an assurance of discontinuance in Suffolk Superior Court 
against TruGreen-ChemLawn to resolve allegations that TruGreen-ChemLawn allegedly 
performed work on consumers' lawns without authorization and then billed consimiers for 
the work. Other consumers complained that the company allegedly continued to perform and 
bill for lawn care even after the consumers had canceled the service agreement. Consumers 
who refused to pay for un-authorized work found themselves dealing with collection agencies 

The assurance of discontinuance required the company to change its sales and 
marketing practices to provide additional disclosure to consumers before entering into or 
renewing a service agreement. In addition, the company also agreed to make efforts to 
satisfy all pending consumer complaints and to submit to binding arbitration if consumers are 
not satisfied. TruGreen-ChemLawn was also required to pay $14,000 in civil penalties and 
$1,000 in costs to the Commonwealth. 

Comm. V. Tower Cleaning Systems. Inc., et al. 

In May 1998, CPAD filed suit against Tower Cleaning Systems, Inc.; Ivan Dubow, a 
Tower employee; JCK Group, a Massachusetts corporation which acted as Tower's agent; 
and JCK Group officers Raymond Johnson and Mario Catalano, for allegedly making 
inflated earnings claims and violating federal regulations in selling cleaning franchises. 

Tower representatives allegedly enticed purchasers into paying thousands of dollars in 
franchise fees by promising that the franchises would earn monthly amounts ranging from 
$1,000 to $10,000. After buying the franchise, some purchasers earned only a fraction of the 
promised monthly revenue, while others did not get any cleaning jobs at all. The complaint 
alleged that Tower failed to give refiinds to these purchasers as required under Tower's own 
franchise agreement, and in some instances after Tower representatives explicitly promised to 
return franchise fees. 



184 



The complaint seeks to ban Tower Cleaning and its representatives from selling 
cleaning franchises in Massachusetts. The complaint also seeks restitution for the franchise 
purchasers, and civil penalties for violating the Massachusetts Consumer Protection Act. 

OTHER INITIATIVES 
Handgun Regulations 

In October 1997, the Office promulgated regulations requiring basic disclosures, fair 
sales practices, and minimum quality and safety standards for handguns sold in the 
Commonwealth. Among other things, the regulations require use limitation devices, such as 
trigger locks; require childproofing for handguns; impose minimum quality standards, 
including a drop test to ensure against accidental discharge and a performance test on certain 
types of handguns; require obliteration resistant serial numbers; and require sellers to provide 
disclosure/safety warnings to customers, and to demonstrate safe use procedures to any retail 
customers. 

The regulations were the result of a lengthy hearing and planning process, during 
which information and comment was taken from industry, health care professionals, 
scientists, and representatives of consumers injured by accidental gun injuries. 

The first phase of the regulations went into effect in January 1998, and the Office was 
sued by a group of firearms manufacturers. At that time, the plaintiffs did not seek a hearing 
to enjoin the first phase of the regulations from going into effect. 

In May 1998, the plaintiffs moved to amend the complaint to add two firearms 
dealers. They then made a motion for preliminary injunction just before the second phase of 
the regulations went into effect. In June, Judge Kottmyer ruled that the Attorney General did 
not have the authority to set product standards, but could only enforce product standards set 
by other agencies and enjoined most of the provisions that were to go into effect in the 
second and third phases. The Office filed a notice of appeal, which is pending. 

Multistate Cigarette Sting 

In May 1 998, Attorney General Harshbarger and the Attorneys General of New York 
and Vermont obtained agreements with Shell, CVS and Kmart that will result in a new 
advertising campaign aimed at convincing Massachusetts teenagers not to begin smoking. 

Pursuant to the agreements, the retailers will each contribute up to $150,000, for a 
total contribution of up to $450,000, to run a series of hard hitting anti-tobacco commercials 
designed to carry their message to teens and younger children. 

The retailers have also agreed to take steps to ensure that minors cannot easily access 
tobacco products in their stores. 

The States of Massachusetts, Vermont and New York conducted joint compliance 
checks in September 1 996 to determine whether retailers operating in the three states were 
complying with laws prohibiting sales of tobacco products to minors. Shell, CVS, and ICmart 
were among the retailers who sold to minors during the joint compliance checks. 



ire: 



DIVISION OF PUBLIC CHARITIES 

The Attorney General represents the pubHc 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.l2, sec. 8. The Division of Public Charities was 
established to carry out the Attorney General's responsibilities in this area. 

More than 37,000 charities are registered with the Division, as well as 273 
fundraisers presently operating on behalf of charities in Massachusetts. A public charity is 
an entity 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 to wind up the affairs of a public charity 
or to change the terms of a charitable trust. 

Beyond enforcement of laws requiring armual 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 that 
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 Sixth Annual Conference for Board Members; and proposed 
legislation in two key areas~(i) charitable fimdraising and (ii) 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 fimdraisers for unfair or deceptive solicitation practices and to enforce their 
fiduciary duties with respect to fiinds raised. In addition to injunctive relief, the Attorney 
General 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. Todd Rampe d/b/a Baystate Benefits, et. al. 

In August, the Attorney General filed a contempt of court action against a 
Cambridge man who had previously been banned fi-om charitable fundraising under a 



186 



judgment obtained by the Commonwealth. The defendant had failed to perform 30 hours of 
community service, as required by the court order. The Attorney General first sued the 
fundraiser in 1995 for allegedly using unfair and deceptive practices during the course of a 
charitable fundraising campaign he conducted on behalf of a Florida charity which is now 
defunct. As a result of the first lawsuit, the fundraiser was permanently banned fi-om 
soliciting charitable money ft-om the public in Massachusetts and ordered to perform 
community service. 

After the contempt lawsuit was filed, the defendant completed the community 
service as directed by the court. In December, the Attorney General obtained a final 
judgment against the fundraiser's Florida client organization, America's Missing Children. 

Commonwealth v. William Twohig d/b/a United States Charitable Publications. 
American Veteran's Relief Fund. Inc.. Disabled Peace Officers Association. Inc.. 
American Manufacturers Mutual Insurance Company 

This deceptive solicitation action, first filed by the Division in April 1997, was part 
of a federal and multistate sweep of telemarketing ft-aud. The defendants in the 
Massachusetts case included a Las Vegas fundraising company, two client charities and the 
bond company. Thereafter a preliminary injunction was issued against one charity 
defendant, the Texas-based American Veteran's Relief Fund, enjoining misrepresentation as 
to any specific item that will be provided by the Fund to VA medical centers in 
Massachusetts. 

In August 1997, the Commonwealth obtained a consent judgment against the other 
charity, the California based Disabled Peace Officers Association, Inc., banning all further 
solicitation activity in Massachusetts and ordering a payment of $6000 in restitution and 
civil penalty. In February 1998, the Attorney General obtained a default judgment against 
the fundraiser, William Twohig, who was thereby permanently barred fi-om further 
charitable fundraising in the Commonwealth and ordered to pay a penalty of $500,000. The 
solicitor's $10,000 bond was paid over to the Commonwealth by agreement with the surety. 
In March 1998, the executive director of the second charity was indicted for mail fraud by 
the U.S. Attorney in Dallas, in part based on informafion from the Attorney General's case, 
and the charity began negotiating with the Attorney General to bring the case to a close. 

Commonwealth v. Allan C. Hill Productions. Inc. et al. 

On November 20, 1 997, the Division brought suit against eleven telemarketing 
companies for failure to account for charitable funds raised in Massachusetts as required 
under c. 68, Section 24(c). The telemarketers failed to timely file their annual financial 
report, co-signed by the charity client. One defendant moved to dismiss under Mass. R. 
Civ. P. 12 (b) (7) and Rule 19 for failure to join the charity client as a necessary party. The 
Division filed a brief opposing the Motion which will be heard in August 1998. 

The initial complaint was amended twice by the Division, first to add three other 
telemarketing companies that were out of compliance and later to add nine affidavits from 
charity clients attesting to the fact that they had not been asked to co-sign the report until 
after suit was filed. Four of the defendants have settled and consent judgments have been 
entered ordering payment of penalties from $1000 to $2000 for each unfiled report. 



187 



Commonwealth v. Ranick Enterprises. Inc. et al. 

On December 4, 1 997 the Division obtained, ex parte, a court order freezing the 
bank accounts of a multistate fimdraising operation that defrauded Massachusetts donors of 
millions of dollars in charitable contributions. The Complaint was filed along with a 
Motion for Trustee Process and Temporary Restraining Order against six fimdraising 
companies and four charities. The Complaint also named the bond company and three 
banks as well as the mastermind of the operation, a Canadian citizen. Five days later, the 
Division obtained preliminary injunctions against all the fiindraisers and all the charity 
defendants. Thus far, defaults have been entered against two of the fundraisers and a final 
judgment entered against one of the charities. Help Hospitalized Children's Fund, Inc., 
based in Texas. 

Commonwealth v. J.J. Smith d/b/a Mass Media Associates 

In January 1998, the Division filed a complaint against an East Boston 
telemarketing company that engaged in deceptive charitable fundraising on behalf of a 
Milford-area police association. Neither the association nor the fundraiser was registered 
with the Division. A consent judgment against the fundraiser was filed the same day as the 
complaint, requiring payment of $10,000 to the Attorney General's Local Consumer Aid 
Fund. The telemarketer was also ordered to comply with all registration and reporting 
requirements of the Charitable Solicitation Act, c. 68. An Assurance of Disconfinuance 
was signed by the police association. 

Commonwealth v. International Union of Police Associations. Vietnam Veterans of 
America. Massachusetts State Council. Inc.. American Trade and Convention 
Publications. Inc.. Robert James Drake Marketing. George Campbell 

In this deceptive fimdraising case filed in 1996, consent judgments had been 
entered against all defendants except George Campbell, named individually as the principal 
of a specific but defunct fimdraising company. In January, 1998, the complaint in this 
pending case was amended to add evidence, from the Division's further investigation, 
attesting to the direct and personal involvement of Campbell in the deceptive fundraising. 
The case is pending. 

Commonwealth v. M«&:M Advertising Associates. Inc.. John E. MacNeil. Hugh M. 
Mayher. et. al. 

In January, the Attorney General filed a contempt action against two Massachusetts 
fundraisers and their company for failing to pay $30,000 in court-ordered penalties. The 
penalties were part of a judgment previously obtained by the Division in a suit alleging that 
the defendants conducted deceptive charity campaigns for high school sports associations 
and a publication for senior citizens. After the contempt complaint was filed, partial 
payments were made to the Attorney General's Local Consumer Aid Fund and an Amended 
Consent Judgment was filed with the Court which changes the defendants' payment 
schedule. 

Commonwealth v. Robert Aaron 



188 



In June, the Attorney General filed a contempt complaint against a Hyde Park 
telemarketer for allegedly continuing to raise charitable funds in Massachusetts after a court 
judgment ordered him to stop such practices. The man had agreed to stop working as a 
charitable fundraiser in a consent judgment obtained by the Attorney General in a 1994 
deceptive solicitation enforcement suit. The contempt suit seeks further injunctions and 
penalties. 

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 voltime 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: 

Attorney General v. Miles J. Schlichte. Trustee, et. al. 

In November, the Massachusetts Appeals Court affirmed the Probate Court's 
dismissal of a trustee's petition for coimsel fees and denial of his motion for an evidentiary 
hearing, agreeing with the Attorney General's position that the trustee was entitled to 
neither. The Attorney General had prevailed in a lawsuit filed previously against the 
defendant, who was a trustee of a scholarship flmd for the benefit of students in three Essex 
County communities. The Attorney General's complaint alleged that the trustee had 
improperly excluded certain applicants for the scholarship awards. The Probate Court 
denied the trustee's petition for counsel fees for defending the original lawsuit. The trustee 
appealed that decision to the Appeals Court, and the Attorney General filed a brief in 
opposition. 

City of Maiden v. Attorney General 

The Attorney General has had on-going involvement in the review under charities 
laws of the City of Maiden's proposed use of parkland to build five new schools in the City. 
Two of the five sites were reviewed because the City may have held one or both of them in 
charitable trust and therefore would need court authorization to modify the use of the park 
to become a school site. 

In 1997 the Attorney General had determined that the Roosevelt Park was held in 
trust and required that the City apply for court authorization to alter the park. A court order 
granting that authority was signed in April 1997. In 1998 the Attorney General extensively 
reviewed the charitable status of the Ferryway Green Park, a controversial site for a 
proposed new school. The Attorney General determined that the City did not hold this park 
in trust and therefore the Attorney General did not have jurisdiction to prevent or otherwise 
oversee the building the school on the parkland. However, in response to public concerns 



IRQ 



about this site, and with the support of the Attorney General, the City of Maiden voted to 
convert an old school in the same neighborhood into a park by the year 2001. 

Trustees under the vyill of Caroline Weld Fuller v. The Attorney General 

In 1998 the Fuller Trustees submitted a complaint for cy pres for the probate court's 
approval. The complaint is the last chapter of a lengthy case involving the removal for 
misconduct of the prior trustees of a charity which provided housing for elderly in Milton, 
the management of the trust by a receiver, the return to the trust of $1 million by the former 
trustees, and an appeal to the SJC on issues raised by the probate court judge, and finally 
the appointment of new trustees in November 1996. The cy pres complaint which is pending 
at the close of the fiscal year provides for the sale of the property to a non-profit housing 
developer and for the Fuller Trust to become a grantmaker to the Milton development to 
help elderly poor people afford to live in the newly developed premises. 

Massachusetts Historical Society v. Attorney General 

The Massachusetts Historical Society ("MHS") is a privately funded institution 
founded in 1 791 for the purpose of providing a major research library of Americana. The 
MHS notified the Division that it wished to modify the terms of restrictions on use of 
certain funds and to adopt a total retixm philosophy toward the management of funds with 
income reinvestment provisions. The trustees' implementation of the restrictions typically 
resulted in unapplied income, administrative costs, and outdated uses. The MHS 
specifically sought to apply the doctrines of deviation and cy pres to use these funds for 
more general purposes. 

The MHS relied upon the Uniform Management of Institutional Funds Act in its 
proposed adoption of a management policy which would allow it to expend up to 7% of 
appreciation, upon a determination that it would be prudent to do so. 

In June, after review of the Complaint for Application of the Doctrines of Deviation 
and Cy pres, the Division assented to the proposed relief. 

Fleet National Bank, as Trustee of the Florence Elliott Seeley Irrevocable Trust v. 
Attorney General and Worcester Polytechnic Institute 

The Florence Elliott Seeley Irrevocable Trust ("the Trust") is a large charitable 
scholarship trust. The settlor included provisions with respect to income accumulation, the 
number of annual awards, the lending of scholarship funds, the loan repayment period, and 
the expenditure of income only for scholarship awards. The Trustee alleged that the settlor 
included these provisions in the expectation that they would be needed to ensure the growth 
and preservation of the trust fiand and that there would be no substantial change in factors 
such as the cost of higher education, the prevalence of borrowing students, the need for 
post-graduate study, and the effect of federal tax law. Contrary to the settlor's expectations, 
the value of the trust ftmd and the amount of its aimual income vastly exceed the value and 
amount anficipated. In June of 1998, after review of a Complaint for Instructions, 
Deviation, and Adoption of a New Trust Agreement, the Division assented to the Trustee's 
proposed changes, and judgment was entered by the court. 



190 



Boston Evening Medical Center. Inc. v. Attorney General 

The Boston Evening Medical Center, Inc. ("BEMC") is a charitable corporation 
which owned and operated a community health center that provided a variety of clinical 
services to residents of Boston's Back Bay and greater Boston area. BEMC's Complaint 
sought permission to sell its operating assets (but not its real estate) to the General Hospital 
Corporation ("the General"), an affiliate of Partners HealthCare System, Inc., and to 
become a grantmaking foundation. BEMC alleged that it was impossible for it to continue 
to provide services without an affiliation with a large health care organization. 

In April of 1998, after review of the details surrounding the sale, the Division 
assented to the proposed relief, and the court entered judgment allowing BEMC to proceed 
with its plan. 

William G. McDevitt. Ill, et al.. for the Board of Directors of the Boston Center for 
Blind Children v. Attorney General 

The Boston Center for Blind Children ("the BCBC") is a not-for-profit corporation 
whose original purpose was to care for blind infants. Since the 1980's, BCBC has assisted 
blind or visually handicapped children and children with multiple handicaps by operating a 
residential and educational center for children with special needs. 

The BCBC determined that in order to compete with larger, better-financed multi- 
service organizations that provide a broad mix of community services, and to comply with 
the Americans With Disabilities Act, it would need to undertake major renovations at the 
Facility, but that such renovations would deplete its assets. Consequently, the BCBC 
presented the Division with a Complaint for the Application of the Doctrine of Cy pres to 
enable it to change fi-om a direct provider of services to a grantmaker. In November, after 
its review of the Complaint, the Division assented to the proposed relief, and judgment was 
so entered by the court. 

Wills. Trusts, and Other Probate Statistics 

During the past fiscal year, the Division received 1,166 probate citations; received 
and reviewed 908 new wills, and received and reviewed 413 interim accounts for executors 
and trustees, as well as 552 final accounts. In addition, the Division received 364 
miscellaneous probate matters or pieces of correspondence in new or existing probate cases, 
in addition to 70 petitions for license to sell real estate and 35 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 555 assents were issued in all categories of probate matters. 

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 or to prevent the misuse of 



iqi 



charitable funds. Under Attorney General Harshbarger, in recent years the Division has 
brought a number of enforcements actions and obtained several governance agreements, 
after investigation, in which charity boards have agreed to reform the manner in which they 
operate. This years such matters included: 

Peaceful Movement Committee. Inc. and Scott Harshbarger v. Janet Hughes- 
Williams, et. al 

In September the Division obtained a default judgment against the former 
executive director of a state-funded provider of addiction-treatment service, banning her 
from holding any position of financial responsibility or control of any charity for five 
years. The judgment also banned the executive director for five years fi-om participating as 
a management employee or board member of any charity without first obtaining appropriate 
training. 

A judge had earlier ordered the Division to become a party in a lawsuit filed by the 
charity's board of directors seeking to terminate the executive director's employment. The 
Division filed a complaint alleging that the executive director had sought to utilize the 
charity for her own personal gain, had falsified reimbursement claims to state regulatory 
authorities, and had conducted the charity's programs in violation of regulatory standards. 
The court had also granted the Division's request for a preliminary injunction suspending 
the executive director's employment and appointing a temporary receiver to manage the 
charity. 

Attorney General v. Hillcrest Remedial Reading School. Inc. 

The Division obtained an order appointing a receiver for a charity for students v^dth 
dyslexia and other reading disabilities. Following the death of the charity's president, the 
charity had no remaining members of its board of directors or corporate officers. 
Therefore, appointment of a receiver was necessary to: (a) sell the charity's assets; (b) 
initiate court dissolution proceedings; (c) recommend the appropriate court disposition of 
the charity's assets to other charities; and (d) comply with resulting court orders to convey 
the charity's assets. 

Mount Ida College 

Mount Ida College agreed to implement a series of reforms in the areas of trustee 
selection; executive compensation; conflicts of interest and related party transactions; 
oversight and monitoring by the Board of Trustees; and public filings with the Attorney 
General's Public Charities Division. 

The agreement was the result of a Division investigation of the College trustees' 
oversight and monitoring of College activities following the June, 1997 indictment of the 
College's former chief financial officer for allegedly misappropriating funds from the 
College through personal credit card purchases, falsification of corporate records, and tax 
evasion. The indictment also alleged that the official caused the College to file false 
financial reports with the Division by failing to fully report the benefits which he and other 
College officials received from the College. 



192 



For-Proflt Acquisitions 

The Public Charities Division continued this year to devote considerable time and 
resources to investigating 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. 

During the year, the Division handled matters relating to five conversions or 
proposed conversions of nonprofit health care providers. 

Neponset Valley Health System 

Neponset Valley Health System, a non-profit hospital system on two campuses, 
proposed to sell its assets to Columbia/HCA, a national for-profit hospital chain. As in 
other Division investigations of such conversions, the Division obtained the assistance of an 
independent expert and conducted extensive discovery. The Attorney General held a public 
hearing in July in Norwood. 

In the midst of the Attorney General's review, Columbia and Neponset ended their 
negotiations and terminated the proposed disposition. The nonprofit Caritas Christi Health 
Care System then proposed a merger of Neponset with Caritas. The Division reviewed the 
proposed merger under charities laws, and the merger was completed in November. 

Boston Regional Medical Center 

Boston Regional Medical Center ("BRMC") is an acute care hospital in Stoneham. 
An investigation into the proposed sale of BRMC to a for-profit hospital chain, Doctors 
Community Health Care, Inc., is pending at this time. In February, a public hearing in 
Stoneham was held and well attended. The public and the Attorney General had the 
opportunity to ask questions of the representatives of both the seller hospital and the for- 
profit buyer. As in other Division investigations, extensive discovery has been issued and, 
with the assistance of an independent expert, the Attorney General has reviewed the 
documentation received in response to its discovery requests. 

Central Massachusetts Health Care. Inc. 

In 1995 Central Massachusetts Health Care (CMHC), a non-profit HMO in 
Worcester, sold substantially all of its assets to a for-profit HMO. The Attorney General 
conducted a full investigation of the proposed sale, including issues involving the need to 
sell, due diligence, and potential conflicts of interest. The sale generated $45 to 50 million 
in proceeds to be used by a foundation to make health-related grants for the benefit of the 
vulnerable population in Central Massachusetts. The probate court which approved the sale 
retained jurisdiction of the case to oversee a controversy involving the 1800 physicians who 
provided services under a reimbursement contract with CMHC, and to oversee the 
foundation planning process. 



193 



The Physicians' Claims 

The doctors claimed that CMHC owed them millions of dollars for reimbursement 
for services rendered for past years. The Attorney General had taken the position in the 
transaction investigation that in large part the doctors' claims were not recognizable debts 
of CMHC and therefore CMHC could not pay out money to the doctors. The controversy 
involving the physicians was resolved in September 1997 through formal third-party 
mediation initiated by the Attorney General. The settlement agreement was approved by the 
probate court. Payments are being made to the physicians through December 1998. A 
substantial portion of the sale proceeds will remain for the charitable foundation. 

Foundation Planning 

The board of CMHC is charged in the court order with working with the Attorney 
General and the community to create a foundation for the proceeds from the sale. Working 
together the Attorney General and CMHC are to make decisions about the foundation for 
the court's approval, regarding the mission, form, and governance of the foundation. In 
September 1997 CMHC engaged a foundation planning consultant. The board and the 
Attorney General have been working on this project throughout the year and are close to 
presenting a plan to the court for its approval. 

Metro West Medical Center 

The Division actively investigated controversies at Metro West regarding a change 
of Chief Executive Officer, adjustments in services provided, and Columbia's adherence to 
previous public commitments. The Division monitored compliance with agreements 
previously negotiated with Columbia and Metro West and oversaw implementation of post- 
judgment requirements of the court order that had approved the sale to Colimibia. The 
Division also monitored the process involved in the proposed sale by Columbia of its 80% 
interest in Metro West. 

In April, after months of negotiation and a formal third-party mediation process, the 
Attorney General, Metro West and the Town of Natick announced a mediated settlement 
resolving long-standing disagreements between Natick and Metro West. The agreement 
addresses the structure and control of the foundation to be fiinded with the net proceeds of 
the original sale. The agreement is subject to the development of final documents and 
approval by the Supreme Judicial Court. 

St. Vincent Hospital 

In 1996 the Attorney General investigated the sale of St. Vincent Hospital in 
Worcester to the for-profit hospital chain, OrNda. St. Vincent Development Foundation 
("SVDF") was a non-profit subsidiary which held $1.8 million in donor restricted funds for 
the benefit of the hospital. As a result of the hospital becoming a for-profit entity, the funds 
held by SVDF needed to be distributed according to the doctrine of cy pres in a court 
proceeding for dissolution of SVDF. The Attorney General oversaw the entire process. 
The restricted fimds were inventoried, and catagorized according to purpose. A lengthy 
trustee agreement between SVDF and the Worcester Diocese, the designated recipient of 



194 



the flinds, was signed. The complaint for dissolution was submitted to the Single Justice of 
the SJC with the plan for the use of $1.8 in restricted funds. The court signed the order 
transferring the funds in June 1998. 

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.l80, §8A(c). During the year, the Division 
reviewed over 35 such dispositions. In addition to for-profit dispositions such as those 
discussed above, significant proposed disposition transactions reviewed included the 
following: 

a) Blue Cross Blue Shield: proposed nonprofit reorganization; 

b) New England Education Loan Marketing Corporation (NEELMC)/Nellie 
Mae, Inc.: transfer of assets and operations to for-profit subsidiary, with 
NEELMC to become a grant maker; 

c) New England Medical Center: affiliation acquisition by nonprofit LifeSpan, 
Inc. of Rhode Island. 

d) U.Mass Medical Center and Memorial Health Care: merger. 

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, §11 A. After review, negotiafion 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 1 1 1 final judgments dissolving 
charitable corporations pursuant to section 1 1 A. 

SIGNIFICANT DIVISION INITIATIVES 

Public Education Campaign 

In consultation with the Attorney General's Advisory Committee on Public 
Charities, the Division continued its ongoing public education campaign regarding 
charitable giving and charity stewardship. 

The Division continued to distribute its wide variety of public education materials, 
including "The Attorney General's Guide For Board Members of Charitable 
Organizations". "How To Give But Give Wisely", "Tips On Charitable Giving", and 
"Questions Commonly Asked To The Division Of Public Charities". 



195 



In November, the Division conducted the sixth annual "Giving Season" pubHc 
education campaign. Carried out in conjunction with the Better Business Bureau and the 
American Association Of Retired Persons Of Massachusetts, this education campaign is 
part of 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. Materials 
distributed, in addition to those mentioned above, included the '"Attorney General's Guide 
For Charities Who Fundraise From The Public" and "Question And Answer Guide For 
Professional Fundraisers". 

The "Giving Season" public education campaign featured the annual "Attorney 
General's Report On Telemarketing For Charity". The report provides general information 
about professional fundraisers and their statutory reporting obligations and specific 
information about the campaigns conducted in calendar year 1996. Annual financial reports 
from 3 1 3 charitable telemarketing campaigns conducted by 72 separate telemarketing 
companies were analyzed. Total revenue from all campaigns amounted to $68,244,932, out 
of which slightly more than $24 million dollars went to charity. The average percentage 
received by the charity was 35 percent, after all fiindraising expenses were deducted. This 
represents seven percent less than the amount received by charities the previous year. On a 
per campaign basis, the average percentage received by the charitable organizations was 
27%. The Division filed suit against eleven telemarketing companies for failure to file the 
required financial reports. 

The Division also helped prepare, and appeared in, the Attorney General's "Issues 
and Answers" cable TV program on charitable giving in November. 

Sixth Annual Conference for Non-Profit Board Members 

The sixth aimual Attorney General's conference for non-profit board members, 
entitled "Non-Profit Board Members: Resources For The Future", was held April 8 in 
Worcester. The conference was attended by 304 volunteer charity directors and other 
members of the charitable sector representing 208 non-profit organizations from across 
Massachusetts. 

The conference agenda addressed the challenges facing charity fiduciaries as they 
plan for the fiature in a world of changing resources, pressures and structures. 

National Training for Regulators on For-Profit Acquisitions 

Under a grant from the W.K. Kellogg Foundation, the Division developed and 
conducted a national training conference for regulators on the issues facing states in for- 
profit acquisitions and conversions and nonprofit-to-nonprofit transactions. In preparing 
the conference, the Division organized an advisory group that included the National 
Association of Attorneys General, the National Association of State Charity Regulators, the 
National Association of Insurance Commissioner, and the Association of State and 
Territorial Health Officials. Held in July 1998, the training conference featured panels of 
experienced regulators and outside experts. 

The Attorney General's Community Benefits Initiative 



196 



The Division was closely involved in the implementation of the Attorney General's 
Community Benefits Guidelines for Nonprofit Acute Care Hospitals. 

During the first full reporting cycle, the Division reviewed the submittals fi-om 75 
separate hospitals. Each report was evaluated in terms of its compliance with the 
Guidelines principles. Upon request, informal guidance as to the expectations of the 
Attorney General's Office was provided to a large number of hospital community benefits 
coordinators. 

A summary report presenting the aggregate results of this review was issued in 
September 1997. The report indicated that £169.8 million dollars was budgeted or 
expended for community benefits or community service programs in FY 1995. A 
computerized community benefits database was developed, showing that more than 20 
percent of the sampled programs were devoted to community health education and fi-ee or 
low cost screening. The database also revealed that slightly more than 14% of the sampled 
programs sought to improve employment and housing in targeted neighborhoods. 

To encourage further hospital participation in the Guidelines Initiative, the Division 
participated in a community benefits training on May 27, 1998, hosted by the 
Massachusetts Hospital Association. The focus of discussion was a new financial reporting 
grid and simimary guidance sheet prepared by the Division. That training was followed by 
two informal question and answer sessions held at the Attorney General's Office to which 
hospital community benefits coordinators were invited. 

In 1998, the Division received and evaluated 65 separate hospital submittals related 
to the FY 1996 community benefits programs. The results of that review will be described 
in a status report to be issued this fall. 

The Division continues to play an important role in disseminating information about 
the Attorney General's Community Benefits initiative to interested individuals and agencies 
throughout the United States. For example, productive exchanges of information have 
taken place with California, where community benefits is a statutory obligation, and 
Connecticut where a similar initiative is under consideration. 

The Division is actively participating in the Attorney General's Community 
Benefits Advisory Task Force and particularly in the activities of the working groups on 
Needs Assessment and on the Collaborative public health initiative. The Division will chair 
the Implementation Issues working group which will have its first meetings early this fall. 

Legislation 

The Division drafted legislation filed by the Attorney General to strengthen the laws 
relating to charitable fimdraising, while bringing them into conformity with U.S. Supreme 
Court decisions. The legislation would prohibit misrepresentations of the amount or 
percentage the charity will receive, require that the compensation paid to the fundraiser be 
fair and reasonable to the charity, and prohibit the charity from giving control or 
management of its affairs to its commercial fundraiser. 



1Q7 



The Division also assisted in the drafting of legislation co-sponsored by the 
Attorney General to codify and strengthen the laws relating to for-profit acquisitions and 
conversions of non-profit acute care hospitals and health maintenance organizations. In 
addition to addressing the investigation and review procedures followed by the Division, 
the legislation would enact stronger protections relating to community benefits, indigent 
care, and community access to essential health services. 

Implementation of Probate Court's Uniform Probate Practice/Charitable Interests 

The Division continued to implement the Uniform Probate Practice: Charitable 
Interests, which became effective December 1, 1996. The purpose of the Uniform Practice 
is to clarify when notice must be given to the Charities Division of proceedings in the 
Probate Courts, and otherwise to encourage uniformity of practice relating to charitable 
interests and to conserve the limited resources of both the courts and the Charities Division 
by eliminating unnecessary paperwork and delay. The new rules are the result of a Division 
initiative undertaken with a subcommittee of the Advisory Committee 

Conference and Professional Education Presentations and Publications 

As part of the Division's ongoing public education effort throughout the year, the 
Director of the Division and other Assistant Attorneys General in the Division spoke to 
numerous charitable groups, served on several continuing professional education panels and 
national educational conference panels, and contributed to educational publications. 

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 4,200 requests to view files in the past fiscal 
year and, in response, approximately 6,900 files were pulled. 

Charitable Organizations: Registration and Enforcement 

From July 1, 1997 through June 30, 1998, the Division processed approximately 
14,728 annual financial reports and annual filing fees totaled $1,379,760. During this 
period, 481 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 
8,100 charities whose armual filings were deficient or delinquent to rectify filing 
deficiencies. 

Issuance of Certificates to Charities Who Fundraise 



198 



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, 9,595 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 ftmdraising counsel, or commc-cial co-venturers in conjunction with soliciting 
charitable organizations 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 ftmdraising campaign. 

During the fiscal year ending June 30, 1998, a total of 273 registrations were 
received and approved, resulting in $57,800 in fees to the Commonwealth. Registrations 
were received from 92 solicitors, 141 fund-raising counsel, and 40 commercial 
co-venturers. 

Charities Division Computerization 

With Information Technology fimding from the Legislature, the Attorney General's 
Office is in the process of developing and implementing a new, comprehensive database 
and imaging system for the Division's charity and fundraiser registrations and financial 
filings. The new system will enhance compliance with the registration and financial 
reporting requirements, facilitate the Division's administration of the registrations and 
filings, and improve public access to the filed information. 

TABLE L Money Recovered 
For The Commonwealth Treasury 

A. Charitable Registrations, Certificate Fees, $ 1 ,44 1 ,7 1 0.00 
And Fundraiser Registrations 

B. Other fees, requests for copies, requests 

for computer information $3,072.43 



199 



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 fimction: through the Division's consumer hotline, 
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 

1998 Private Passenger Automobile Insurance: 

On July 7, 1997, the Automobile Insurance Bureau of Massachusetts ("AIB") filed 
with the Division of Insurance its recommendation concerning the profit component of 
1998 private passenger automobile insurance rates. On August 15, 1997, AIB filed with 
the Division of Insurance its recommendation concerning the main rate for 1998 private 
passenger automobile insurance rates. On profits, AIB requested an increase of 2.22% and 
on the main rate, it requested an additional 4.6% increase over the 1997 rates. If approved, 
these requests would have been equivalent to an average increase in auto insurance 
premiums for Massachusetts drivers of $56 per car or 196 million dollars overall. On behalf 
of Massachusetts consumers, the Division challenged the increase requested by the 
industry. On December 10, 1997, the Commissioner issued a decision fixing and 
establishing an average rate which is approximately 4.8% lower than the equivalent 1997 
rate or 10.8% lower than the industry's requested increase. This reduction included 40% of 
the 176 million dollars collected in error during the years 1991 through 1996. The 
remaining 20% will be returned to policyholders in rate year 1999. The Division's 
intervention resulted in savings to Massachusetts consumers of 3 1 3 million dollars or an 
average of $90 per car. In addition, rates will be reduced in 1999 by approximately 35 
million dollars. 



200 



1999 Automobile Insurance: 

Proceedings concerning the 1 999 automobile insurance rate began on May 11,1 998 
with notice of the annual hearing called by the Commissioner to determine whether it was 
necessary that the rates for 1999 be fixed and established in accordance with G.L.M. c. 175, 
§1 13B. The Division participated in the hearings and took the position that market 
conditions continued to require that rates be set pursuant to G.L.M. c. 175. The Division 
noted, however, that for the third consecutive year 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, 1997 and 1998. No decision had been issued 
by the Commissioner by the end of the fiscal year. 

FAIR Plan Rate Increase: 

In August, 1 997, the Massachusetts Property Insurance Underwriting Association 
("FAIR") submitted filings to the Division of Insurance for increases in their Homeowners 
product and their Dwelling and Fire product. The Division participated in the hearings and 
the case was settled by stipulation. The stipulations resulted in savings to Massachusetts 
consumers of $980,792. 

BCBS Medicare Supplement Insurance: 

In August of 1997, BCBS filed for an increase in its Medicare supplement insurance 
policy rates to be effective in 1998. Following lengthy hearings before the Commissioner 
in which the Division actively participated and argued against the increase, the 
Commissioner approved an increase, effective March 1 5, 1998, that was over $21 million 
dollars less than BCBS had requested. 

United Health Care: 

In December 1 997, United Health Care filed for increases in its Medicare 
supplement policy rates to be effective in 1998. These policies are provided to members of 
the AARP. Following lengthy hearings before the Commissioner in which the Division 
actively participated and argued against the increase, the case was settled by stipulation of 
the parties. The Commissioner approved the stipulation in February 1998. The stipulation 
resulted in an aggregate rate that was $1,568,624 less than United Health Care requested. 

Mutual of Omaha, New York Life: 

In September 1997, Mutual of Omaha and New York Life filed for increases in their 
Medicare supplement policy rates to be effective in 1998. These policies are not open to 
new members. Following hearings before the Commissioner in which the Division actively 
participated and argued against the increase, the case was settled by stipulation of the 
parties. The Commissioner approved the stipulation in April 1998. The stipulation resulted 
in an aggregate rate that was $349,000 less than Mutual of Omaha and New York Life 
requested. 

Bankers Life & Casualty: 

In November 1997, Bankers Life and Casualty filed for an increase in its Medicare 
supplement rates to be effective in 1998. All of the policy forms for which Bankers Life 
seeks a rate increase are closed to new enrollment. For forms A043 (the Core Plan) and 
A044 (the MediSup 2 Plan), Bankers requested 100% and 117% respectively. For forms 
73X, 98X, and A042, (guaranteed renewable age-rated plans with prescription drug 



7ni 



coverage), Bankers Life requested respective rate increases of 83%, 77%, and 64%. For 
form A040 (age-rated, guaranteed renewable Core plan). Bankers requested a 46% increase. 
The Division intervened in the case and participated in the hearings. On June 1 1th, the 
Commissioner disapproved the rate request and asked Bankers to submit additional 
evidence to demonstrate the reasonableness of its administrative expenses and other 
expense components . No decision had been entered in the case by the end of the fiscal 
year. 

World Insurance Company: 

In March 1 998, World Insurance Company filed for a rate increase in its Medicare 
supplement policies. All of the policy forms for which World seeks a rate increase are 
closed to new enrollment. For forms D-A041(old Medisup2 policy) and D-A044 (new 
Medisup 1 policy), World requested an increase of 52%. For D-A042 (old MedisupS 
policy) and D-A045 (new Medisup2 policy), World requested a 103% increase. The 
Division intervened in the case and participated in the hearings. No decision had been 
entered in the case by the end of the fiscal year. 

Community Health Plan/ Kaiser Foundation Health Plan of MA: 

In April, 1998, Community Health Plan/ Kaiser Foundation Health Plan of MA 
filed for a rate increase for its Medicare cost contract. Kaiser asked for a rate of $97.65 per 
member per month for the base medical product and $69. 1 per member per month for the 
drug rider. Combining the 2 rates, this represents approximately a 60% increase from last 
year's rates. The Division intervened in the case and participated in the hearings. No 
decision had been entered in the case by the end of the fiscal year. 



CONSUMER PROTECTION/ENFORCEMENT 

The Division also engaged in non-rate case related insurance work during fiscal year 
1998 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 1 998 fiscal year, the Division continued to investigate complaints against 
employers who allow their group health plans to lapse because of their failure to remit 
health insurance premiums or their failure to provide sufficient funds to cover their 
employees' health costs. 

Investigations 

The Division investigated 49 employers in response to these types of complaints 
during this fiscal year. The Division has seen a marked decrease in the volume of "failure 
to remit" complaints since 1996, when the Division was instrumental in promulgating an 
Attorney General regulation, 940 CMR 9.00, that requires insurers to pay claims until they 
have notified employees directly of any termination of coverage. With the exception of 
disputes between a single employee and the employer, most complaints now relate to self- 
insured plans. 



202 



Criminal Prosecution 

The Division obtained the conviction of John E. Flynn, Jr., the owner and CEO of a 
Boston architectural and engineering firm who failed to remit health insurance premiums 
and other payroll withholdings including employees' contributions to the employer's 401(k) 
plan and state withholding taxes. In October 1997, Flyrm pleaded guilty to several counts 
of felony larceny of employee funds, failure to account for and pay over state withholding 
taxes and failure to file personal income tax returns. As one condition of his probation, the 
Court order Flynn to pay full restitution to the victims. The Division continues to take 
action to enforce the restitution order. 

Bankruptcy Intervention: 

During the fiscal year, the Division's motion to intervene in the bankruptcy filing of 
Summit Plastics was allowed by the bankruptcy court. Summit filed for chapter 1 1 
protection leaving its former employees with medical bills in excess of $22,000 
outstanding. The matter was still pending at the end of the fiscal year. 

Agreements: 
Valley Gage Inc., 

Following complaints by employees, an investigation into Valley Gage, Inc. 
revealed that the company owed over $26,000 in unpaid medical bills in its self funded 
health insurance plan. In June of 1 998, Valley Gage signed a business agreement agreeing 
to pay the bills with initial payment of $7,000 and subsequent monthly payments of $5,000. 
$12,000 had been paid by the end of the fiscal year. 

American Electronics Co. 

Following an April 1998 complaint by an employee of American Electronics Co., 
the company agreed to reimburse the employee over $4,600 in contributions he had made 
to group health insurance. 

Logan Health Care 

Following several complaints and several instances of cancellation of coverage by 
Logan Health Care, an operator of five nursing homes, because of Logan s failure to pay its 
health insurance premiums, Logan entered into an agreement with the Office to provide 
evidence of payment to the Office on a monthly basis. Logan is now in good standing with 
its health insurance carrier. 

Trina, Inc. 

Following the c. 7 bankruptcy of Trina, Inc, the Division sent an informational letter 
to Trina' s employees advising them of their options to file a proof of claim form with the 
bankruptcy court in order to obtain priority in the payment of over $40,000 of unpaid 
medicals bills in Trina' s self insured plan. 

Following an investigation of one company's failure to pay its health insurance 
premiums, the Division discovered that a local HMO was in violation of 940 CMR 9.00. 
The HMO had refused to pay health insurance claims of employees of 26 companies 
without first notifying the employees that their coverage had been canceled because of 
nonpayment. That investigation was ongoing at the end of the fiscal year. 



203 



LONG TERM CARE INSURANCE 

Long-Term Care Insurance 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. 



Long Term Care Task Force 

Members of the Division, together with Bureau attorneys, continued to participate in 
a statewide Task Force on Long-Term Care Financing (the "Task Force"). The Task Force 
is a bipartisan effort organized by the Attorney General and former Governor Weld to 
develop strategies to increase the private financing options for long-term care, and to 
provide financial security to elders who risk impoverishment fi-om the costs of long-term 
care services. Participants include representatives of the relevant state agencies, consumer 
and elder advocacy groups, the insurance industry and long-term care provider 
organizations. The Task Force is an outgrowth of the Interagency Workgroup on Long- 
Term Care Financing, in which members of the Division and Bureau attorneys worked with 
the Division of Insurance, the Division of Medical Assistance and the Executive Office of 
Elder Affairs during the first part of the 1997 fiscal year to produce a preliminary report that 
called for fiorther study of certain issues. 

Members of the Division serve on the Task Force steering committee, and have led 
and participated in several working groups that studied and made recommendations on a 
number of issues. These include the regulation of long-term care insurance, public 
education concerning long-term care financing, and development of alternative insurance 
products to cover some of the costs of long-term care. Members of the Division have taken 
lead roles in drafting changes to the Division of Insurance's long-term care insurance and 
life insurance regulations, and in designing public education and disclosure materials. The 
work of the Task Force will continue into the next fiscal year. 



HEALTH COVERAGE 

During the 1997 fiscal year, the Division undertook a variety of initiatives in the 
areas of health insurance coverage and managed care. 

Managed Care 

Members of the Division resolved a large number of complaints received fi-om 
consumers, and in some cases providers, concerning their health plans. These complaints 
fell into several categories: difficulty accessing the grievance procedures of the managed 
care organization; problems related to limited networks of providers; denials of coverage 
for care received in emergency rooms; denials of coverage for care deemed not medically 
necessary or experimental; utilization review policies and practices (e.g., denials of 
coverage made by unqualified plan personnel); and complaints related to quality of care, 
among others. 



204 



A member of the Division made presentations on managed care at a conference 
sponsored by the Boston regional office of the Pension and Welfare Benefits 
Administration of the U.S. Department of Labor, and at a public hearing held in Boston by 
the National Committee on Vital Health Statistics. 



Hospital and HMO Community Benefits 

A member of the Division oversees the Attorney General's HMO Community 
Benefits Guidelines. During the 1998 fiscal year, the Division member provided guidance 
to the HMOs in their completion of their annual community benefits reports, analyzed those 
reports, and authored the Attorney General's report on the status of HMO Community 
Benefits Programs. This work will continue in future fiscal years. 

A member of the Division also serves as coordinator of the Attorney General's 
Advisory Task Force on Hospital and HMO Community Benefits, which was convened in 
June 1998 for the purpose of advancing the goals of the Community Benefits Guidelines. 
This Task Force includes representatives of hospitals, HMOs, community health advocacy 
groups and relevant state agencies, and will be very active during the next fiscal year. 



Legislative Work: 

The Division provided information and support to members of the legislature in 
their drafting and consideration of managed care legislation. 

Public Records Request: 

The Division devoted substantial resources toward responding to a public records 
request by the Massachusetts Association of HMOs for copies of all managed care 
complaints that the Division had received over a two-year period. 

Report on Insurance Coverage for Bone Marrow Transplants. 

The Division produced a report that reviews the coverage of allogeneic bone 
marrow transplants provided by the largest health insurance companies and health 
maintenance organizations in Massachusetts. The report was produced based on a survey 
conducted by the Division of 54 companies doing business in Massachusetts. The report 
provided detailed information on the improvements that have been made in the process of 
locating a suitable bone marrow donor by the National Marrow Donor Program (the 
"NMDP"). The Division, with the assistance of the NMDP, produced the report to 
provide carriers and patient advocates with useful information on issues regarding insurance 
coverage for bone marrow transplants and the need to provide clear disclosures of insurance 
coverage limitations. The survey and report were intended to educate carriers on this 
evolving area of medical care, and at least three HMOs have amended their certificates of 
coverage as a result of the Division's involvement in this issue. 

Non-Group Health Insurance Advisory Board. 

Following the appointment by the Attorney General of the two consumer members 
to the Nongroup Health Insurance Advisory Board, the Division continued to review the 
work of the Board and urged the Commissioner of Insurance to implement the provisions of 
the nongroup law swiftly. 



205 



Balanced Budget Act and Medicare Plus Choice. 

Following statements by the Health Care Financing Administration that certain 
provisions of the Balanced Budget Act could preempt certain mandated benefits available 
to Massachusetts seniors in their medigap supplemental policies and in their Medicare 
HMO products, the Division drafted a letter from the Attorney General to HCFA stating his 
disagreement with a policy that would cause Massachusetts seniors to lose their drug 
coverage as a result of HCFA's decision. 

Blue Cross Blue Shield Reorganization Plan. 

Working with members of the Public Charities Division, members of the Division 
examined the proposed corporate reorganization of Blue Cross Blue Shield of 
Massachusetts (BCBSMA), both from the perspective of the charities laws and the 
insurance laws. BCBSMA proposed splitting its current corporation into several 
corporations: one parent corporation; one HMO corporation; one taxable subsidiary 
corporation intended to be parent to an administrative services corporation and the current 
indenmity corporation. The Office engaged the firm of Arthur Anderson to perform a 
financial analysis of the proposal. Following the Office's review and that of Arthur 
Anderson, the Office found no basis under the charifies laws to oppose the reorganization. 
The Office did, however, urge the Commissioner of Insurance to carefully review, pursuant 
to the insurance laws and regulations, issues of capitalization of the proposed new entities, 
both the initial allocations and the projections of fiiture needs. We also asked the 
Commissioner to provide safeguards to ensure the long term survival of the proposed 
indemnity and the administrative services corporations and urged her to consider some 
requirement for capital from the HMO to any other entity that might become 
undercapitalized. 

Blue Cross Blue Shield Contribution to the Free Care Pool. 

In December 1997, Blue Cross Blue Shield ("BCBS") notified Massachusetts 
hospitals that it planned to withhold 5.06% (approximately $30 million per annum) of its 
hospital payments in order to comply with a newly enacted state law that it contribute 
5.06% of its hospital payments to the free care pool. This action of BCBS's effectively 
nullified the new law, the intent of which was to spread the cost of the free care pool among 
all hospital payors and not limit it to the hospitals which had previously borne all the cost. 
Members of the Division, by way of a December 1 Ith letter, informed BCBS that its action 
could very well have violated state law. As a result of this letter, both the legislature and 
the Governor brought additional pressure to bear on BCBS and, soon thereafter, BCBS 
informed the hospitals that it would not withhold the moneys after all. 

Legal Actions 

Commonwealth v. Fraternal: 

The Division filed a complaint against Fraternal Insurance Group, its owners, Paul Pereira 
Jr. and Sr, and obtained a preliminary injunction against them, prohibiting them from 
engaging in the business of insurance, accepting premiums of fees from consumers in 
connecfion with insurance and freezing their bank accounts. 

Commonwealth v. Fraternal: 

Subsequent to the entry of a preliminary injunction prohibiting them from accepting 

insurance premiums, the defendants. Fraternal Insurance Group, its owners, Paul Pereira Jr. 



206 



and Sr, accepted insurance premiums from several consumers. The Division filed a 
contempt of court action and the case was ongoing at the end of the fiscal year. 

Assurance of Discontinuance. 

The Division entered an Assurance of Discontinuance with an individual that was 
operating an unlicensed dental plan called Merrimack Valley Dental Plan. Under the 
Assurance, MVD Plan was terminated, consumers were refunded more than $3,900.00, and 
a $ 1 ,000 payment was made to the Local Consumer Aid Fund. 

LIFE INSURANCE LITIGATION 

Consumer Complaints: 

During the year, the Division continued to devote a considerable amount of time and 
resources to sales practices in the life insurance industry. These practices included the 
alleged misrepresentations made by various life insurance companies in the sale of their life 
insurance products. These misrepresentations generally involved "churning" (the practice 
of turning in old policies for new policies on the representation that the old policies would 
fully or partly support the new); "vanishing premiums" ( the promise that premiums would 
no longer be necessary after a finite number of years). The Division mediated cases on 
behalf of individual consumers and also engaged in discussions with several companies that 
would resolve the cases on a global basis. 

Companies with whom we mediated individual complaints included Pioneer Life 
and Midland, Commercial Life, Mass Mutual, Metropolitan, AIG Life, Unum Life, Boston 
Mutual, All American Life, Globe Life and Accident, CIGNA, Guarantee Reserve Life and 
Colorado Bankers Life. Individual settlements reached on behalf of individual consumers 
resulted in benefits to them of over $500,000. 

Prudential Life Insurance Company of America Claims Settlement: 

The Division continued to monitor the Alternative Dispute Resolution ("ADR") 
process detailed in our consent judgement against The Prudential and in the global class 
action settlement. The Division devoted significant resources to on-site claims scoring 
monitoring and to overseeing the proper training of all analysts involved in the ADR 
process. Members of the Division uncovered several flaws in the computer system being 
used in the scoring process and was successful in having the flaws corrected by The 
Prudential. During the fiscal year, members of the Division routinely traveled to Newark, 
N.J., The Prudential's headquarters, in order to ensure that claims are being scored fairly 
and to stay abreast of any problems, delays or departures from the settlement guidelines. 
Members of the Division routinely met with all parties and the Independent Claims 
Evaluation Team ("ICE-T") on a monthly basis for status reports and to maintain efficiency 
and progress in claims evaluation. 

By the end of the fiscal year, the Division had begun to receive calls regarding the 
right to appeal the initial decision in the scoring process. Members of the Division also 
spend time with policyholders who do not understand the offers made to them. The 
processing of claims, and accordingly the Division's work, will continue into the next fiscal 
year. 



?n7 



Hancock Mutual Insurance Company: 

On March 25, 1998, the Division filed a consent judgement in which John Hancock 
agreed to provide global relief for the alleged deceptive sales practices of its agents from 
1979 through 1996. The John Hancock also agreed to provide 1.2 million dollars to the 
office of the Attorney General, two hundred thousand to be used for the SCORE program, 
two hundred thousand for the a local Consumer Aid Fund, one hundred and fifty thousand 
to be contributed to the Commonwealth's general ftind as payment of costs associated with 
the litigation and six hundred was to be used for the general piupose of educating 
consumers. The Division used a large portion of these fiinds in an extensive outreach 
program, including media advertising, to reach all John Hancock policyholders to inform 
was available to help them. 

In the litigation, the Division, as in the case against The Prudential, alleged that John 
Hancock engaged in three primary deceptive sales practices in the sale of whole life, 
universal life and variable life insurance policies, as well as certain mutual funds and 
annuities sold during that time frame. The Division alleged that John Hancock engaged in: 
1) "churning" or replacement and financing (a practice of surrendering or borrowing values 
from older policies in order to fiind new policies based on the representation that doing so 
would fully or partially pay for the new policy); 2) "vanishing premiums" or "abbreviated 
premium payment" plans (the practice of selling permanent life insurance products based 
upon the representation that the policyholder would only have to pay out-of-pocket for a 
certain set number of years, with dividends paying the premiums every year thereafter); and 
3) selling life insurance as an investment, retirement plan, savings plan or college savings 
plan (the practice of selling life insurance by either disguising the product as life insurance 
or minimizing the life insurance of the product. 

The national class action included 3.8 million policies, more than 350,000 of which 
are Massachusetts policies. Nationally, more than 267,000 policyholders filed for ADR, 
more than 34,000 of which are Massachusetts policyholders. Nationwide, the ADR election 
rate is 78.59%, whereas Massachusetts has an ADR election rate of 85.21%. 
Massachusetts' ADR response rate is likely a direct result of the extensive consumer 
outreach conducted by the Division. On May 1, 1998, the Division set up a consumer 
hotline to assist policyholders in making appropriate elections of either ADR or General 
Policy Relief ("GPR") and to assist them in filing their claim forms in a manner designed to 
afford them the best possible relief As of Jime 29, 1998, the Division received and 
responded to 20,415 calls. 

The Division also conducted twenty-one (21) claim form assistance seminars, 
traveling across the state to reach as many policyholders as possible. The Division also met 
in small group sessions twice per week with John Hancock policyholders in order to assist 
those individuals who need special attention due to disability or age and for those who 
caimot attend a large group seminar. The Division has met with and assisted 2,609 
policyholders through personal assistance and seminars. 

In addition to consumer outreach, the Division has allocated substantial resources 
and manpower to monitoring and participating in the training of claims analysts. The 
Division attended six five-week classes for claims analysts and, by doing so, expeditiously 
corrected flaws in the training. Additional training for analysts is anticipated and the 



208 



Division will attend those sessions as in the past. The Division continues to meet with 
defendants and plaintiffs' counsel in order to ensure compliance with the letter and spirit of 
the settlement. 

CONSUMER ASSISTANCE 

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 for help. 

Consumer Mediation. 

Members of the Division mediated several matters on behalf of consumers throughout the 
year. Representative matters include: the payment by Life Investors, Inc., of a $20,000 life 
insurance policy, plus interest, which had lapsed because the company failed to send a 
premium notice and canceled the policy without notice; the payment of a disability policy 
by Cigna to a cancer patient with severe financial difficulties when the company had 
refused, for no valid reason, to honor the policy; payment by Aquila Consultants, a French 
insurance company, of $8,400 in maternity coverage it had refused to pay; the Prudential 
Insurance Company agreed to pay the death benefit plus interest of $5,000 plus $! 5,000 and 
$1,000 plus $5,000 for two poHcies it had denied in 1975 and 1986 respectively. In 
addition, the AGELDER help line was instrumental in getting help for seniors such as: 
finding a physician who was willing to make home visits; finding a drug company willing 
to provide fi-ee drugs for a senior who could not afford them; obtaining $2,000 in court 
assisted funds for an elder who had provided the money 6 years ago on the assumption that 
it would be returned; reimbursement of $900 to a senior by a check cashing center that had 
cashed the senior's check with a forged signature; organizing an affordable and subsidized 
fiineral for a terminally ill woman wh had no fimds: for her fimeral; return of $1,800 for an 
unwanted hearing aid; finding financial help for a senior who had no funds to move. 

Sears Retirees: 

In October of 1997, Sears Roebuck, Inc., announced to its employees that it planned to 
reduce their retirement life insurance coverage fi-om an average of $25,000 per retiree to an 
average of $5, 000 per retiree. The local chapter of the retiree group sought the help of the 
Attomey General. While these benefits are covered by ERISA, a federal law that preempts 
state action, the Attomey General wrote to the Chairman of Sears on behalf of the retirees 
asking him to reconsider. The Attomey General also petitioned Senator Kennedy and the 
Massachusetts congressional delegation to amend ERISA so that benefits could not be 
terminated or reduced after retirement. In addition. The Attomey General, through the 
National Association of Attomeys General (the "NAAG") obtained the support of 
Attomeys General across the country for such an amendment. 

Consumer Hot-Line and Paralegal Resolution of Inquiries and Complaints: During 

the fiscal year, the Division received and responded to over 9,000 telephone inquiries, an 



">nQ 



increase of over 12% from the prior fiscal year. In addition, the Division opened and 
mediated on behalf of consumers 1432 written complaints. The Division closed 1455 
complaints. Over $1,767,500.00 were received by consumers through the intervention of 
the paralegal and volunteer interns, an increase of almost 50% over the prior fiscal year. 

AGELDER: 

The Attorney General's Elder Hotline is a new initiative that began operation on 
June 16, 1997. The hotline was established in response to the high volume of calls from, or 
relating to, the elderly that come into the Attorney General's office. Since its inception the 
hotline has fielded approximately 6,1 15 phone calls, or approximately 500 calls per month. 
The hotline staff provides information, referrals, and mediation services to resolve the 
concerns of callers. The hotline is staffed by 10 elder volunteers and 3 part-time staff 
members who receive monthly trainings on elder issues. The majority of callers are elders 
with an increasing number of calls coming from the children of elders as well as with 
professionals who deal with elders in the course of their duties. 

The calls are remarkable for their variety, although some frends are discemable. 
Consumer issues and complaints have been the number one concern. Within this group 
complaints and queries about businesses and private contractors and reports of 
telemarketing and other scams directed at the elderly have been primary. Health insurance, 
especially Medicare, Medigap and Medicare HMOs and long-term care insurance constitute 
another broad area of concern. The hotline also receives calls about tenant/landlord issues, 
financial exploitation, home care, benefit programs, health concerns and questions, 
transportation problems, charities and non-profits and more. 

VIATICAL SETTLEMENTS 

The Division undertook two initiatives regarding viatical settlements during the 
fiscal year: the promulgation of regulations regarding viatical sales and viatical loans and 
the publication of a brochure advising terminally ill people how to obtain cash out of their 
life insurance policies. 

Viatical regulations: 

Working closely with the Aids Action Committee and pursuant to the Attorney 
General's consumer protection authority under G.L. c. 93A, the Division drafted a proposed 
regulation to prohibit unfair and deceptive practices involving viatical settlements. 
Following receipt and incorporation of many of the comments received on the draft 
regulation, the Attorney General's Office held a public hearing on August 1, 1997 and 
published the new regulation in the Massachusetts Register on October 1 7, 1 997. 

Brochure: 

Public Protection Bureau attorneys and the Division drafted a brochure entitled 
"Turning Death Benefits into Living Benefit: A Guide to Drawing Cash from your Life 
Insurance Policy". The brochure was distributed widely through various organizations 
helping the terminally ill. 

OTHER ACTIVITIES 
Legislative Activities 



7in 



In addition to the legislative testimony on managed care, viatical companies and 
community reinvestment mentioned previously, the Division also worked on other 
legislative activities. 
Non discrimination: 

The Division worked in support of a bill, Senate Bill 716, cosponsored by Attorney 
General Scott Harshbarger and Senator Dianne Wilkerson. The bill would provides that 
insurance companies may not discriminate on the basis of gender, inter alia, either in the 
pricing or sale of policies. 



MISCELLANEOUS ACTIVITIES 

Guest Speakers 

Members of the Division made presentations to several organizations regarding 
insurance and financial exploitation of elderly. 

ESTIMA TED SA VINGS TO CONSUMERS 



Auto Rate Case 

Medigap Insurance Rate Cases 

Life Insurance mediation 

Hancock case 

Consumer Hotline 

Total 



313,000,000 

23,520,207 

500,000 

30,000,000 

1.767.500 

368,787,707 



711 



UTILITIES 

The bulk of the utility workload of the Regulated Industries Division in fiscal year 
1998 involved advocacy of consumer interests in the implementation of the dramatic 
changes underway in the telephone, electric and gas utility industries: during the fiscal year, 
there was only one traditional rate case filed but legislation was enacted that opened up the 
Commonwealth's investor owned electric utility industry to competition, two mergers 
between gas utilities were proposed, collaboration intensified among interested parties to 
make competitive gas supplies available to more customers, and the further progress was 
made at expanding the range of activities in which competition could occur in the 
telecommunications industry. The Division was an active participant in all of these 
developments and involved advocating new structures and rules to maximize the consumer 
benefits from the change in regulatory approach as well as to protect the interests of small 
residential and business customers during the transition to new regulatory frameworks. 
Aside from the role played by the Division in the legislative process that led to the 
enactment of the restructuring law, most of this work 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 1998 include: 



ELECTRIC MATTERS 

Restructuring 

Electric Restructuring Act, St. 1997, c. 164. Throughout 1997, the Division played 
an active role in the formal and informal processes through which the Legislature 
considered the many issues involved in restructuring the electric industry to allow for 
customer choice and supplier competition in retail sales of electric power. These efforts 
ranged from providing comments, drafting assistance, and policy analysis on the many draft 
bills released and considered by various Committees in both the House and Senate to 
working with various parties and groups to identify and advance acceptable compromises 
on disputed issues. A bill was passed and signed into law in November, 1997 ("Electric 
Utility Restructuring Act") which was among the first such laws enacted in the country. In 
addition to requiring all investor owned utilities to file plans on or before December 3 1 , 
1997 that provided for customer choice of supplier on March 1, 1998, the Act included 
many pro-consumer provisions. In particular, tracking the Attorney General's Consumers 
First approach to restructuring, the Act required that all utility restructuring plans provide 
for: (1 ) a ten percent reduction in the bills of customers who do not elect an alternative 
competitive supplier; (2) utility "divestiture" of non-nuclear generating facilities with the 
proceeds applied to reduce any "transifion costs"; (3) specified levels of fiinding for demand 
side management programs and the development of renewable energy technologies; (4) 
continuation of special, discounted rates for low income consumers as well as an expansion 
of the eligibility criteria; and (5) transitional assistance to utility employees and towns that 
host power plants. The Act imposed a number of important disclosure and labeling 
requirements on sellers of electric power to protect consumer interests as well as amended 
current laws regarding power plant siting, energy supply planning, power market 
monitoring and consumer education to achieve greater consistency with the restructured 



212 



industry (including a reorganization of the DPU and a change of its name to the 
"Department of Telecommunications and Energy" or "DTE"). 

Rulemaking Proceedings. The Division was an active participant in various 
rulemaking proceedings relating to the restructuring of the electric utility industry. In 
addition to filing comments on DTE rulemaking proposals relating to the Act's 
requirements for electric power supplier registration, supplier disclosure and product 
labeling, consumer dispute resolution procedures and "standards of conduct" governing 
relationships between utilities and affiliates, the Division prepared, published for comment 
and held public hearings in Springfield and Boston on proposed regulations governing the 
marketing and sales practices of entities sellmg power to retail consumers. The regulations 
were proposed pursuant to the Attorney General's authority under the Restructuring Act and 
the Massachusetts Consumer Protection Act, G.L. c. 93A. Among other things, the 
proposed regulations define and prohibit particular deceptive practices, specify minimum 
disclosure requirements, and prohibit any marketing claims relating to the environmental 
impact of the sources of power sold unless accompanied by sufficient disclosure to allow 
consumers to make informed decisions. Final regulations had not been promulgated at the 
end of the fiscal year. 

Boston Edison Company, DP. U. 96-23; Eastern Edison Company, DPU 96-24. In 
May and July, 1997, respectively, the Division, together with other interested parties, 
entered into written settlement agreements with Eastem Edison Company and Boston 
Edison Company under which those two electric utilities agreed to implement the Attorney 
General's "Consumer First" approach to restructuring. This approach formed the basis of 
the Division's earlier agreement with MassElectric that was approved by the DPU during 
fiscal year 1997. Under the terms of the Attorney General's Consumers First approach, the 
utilities agreed to: (1) a ten percent overall rate reduction for all existing customers upon 
the effective date of restructuring; (2) stranded cost recovery limited to the actual amount 
by which the Companies' sunk costs exceeded their market value {i.e., book value less the 
proceeds from the sale of the Company's non-nuclear power generation plants); (3) 
continued levels of substantial funding for energy efficiency programs and programs 
designed to promote clean renewable energy resources; (4) continued funding for special 
rates for low income consumers as well as funding for a new credit guarantee program 
designed to encourage market participants to serve such customers; and (5) mechanisms to 
ease the transition to market competition for customers (a "standard offer" transtion rate), 
utility employees (treatment of retraining, severance, and early retirement programs as 
recoverable "stranded costs"), and communities that host power plants (treatment of any 
necessary "payments in lieu of taxes" as recoverable stranded costs). Evidentiary hearings 
regarding the two agreements were held during the summer of 1 997 and following 
supplemental briefing to address the question of whether these agreements as well as the 
earlier agreement with MassElectric were in "substantial compliance" with the Electric 
Restructuring Act that was signed into law in November, the DPU approved these 
agreement in December, 1997 and February, 1998, respecUvely. 

Boston Edison Company, D.P.U. 97-115 On December 19, 1997, Boston Edison 
requested DTE approval of an agreement to sell its non-nuclear generating facilities to Sithe 
Energies, Inc. The sale was proposed in satisfaction of the terms of the Company's 
restructuring settlement agreement. Under the terms of the sale, Sithe paid $536 million for 



->^■^ 



Edison's plants and, subject to a $121 million credit in its favor, Edison agreed to purchase 
power from Sithe for a limited period of time at specified prices. As required under the 
terms of the Company's restructuring settlement agreement, the net proceeds from the sale, 
$503 million, was to be credited against transition costs that otherwise would be recovered 
from consumers. Following an evidentiary hearing, the Division recommended that the 
DTE approve the sale but condition approval of the exact amount to be credited to 
customers until a later reconciliation after the sale was finalized. On April 24, 1998, the 
DTE adopted the Division's recommendations and approved the sale and the proposed 
customer credit, subject to later reconciliation. 

Commonwealth Electric Company, Cambridge Electric Light Company, Canal 
Electric Company D.P. U./D. T.E. 97-111. On November 19, 1997, the same day that the 
legislature passed the Electric Utility Restructuring Act, Commonwealth Electric Company 
and Cambridge Electric Light Company (both wholly owned subsidiaries of 
Commonwealth Energy System) together with their wholesale affiliate, Canal Electric 
Company, unilaterally filed a restructuring plan with the then DPU. The Division 
participated in five evening public hearings held throughout the Companies' service 
territories and in seven days of evidentiary hearings held during late January at the DTE's 
offices in Boston. In briefs filed in early February, the Division urged the DTE to require 
the Companies to modify their plan to bring it into compliance with the requirements the 
Restructuring Act by, among other things, providing a greater rate reduction, reducing the 
rate at which carrying costs are accrued on the balance of any uru-ecovered transition costs, 
and incorporating a effective cost mitigation incentive mechanism, similar to those included 
in the earlier settlements, to apply to the ongoing costs at nuclear facilities in which the 
Companies were involved. On February 27, 1998, the DTE issued an order in which it 
adopted the Division's position on the magnitude of the rate reduction required under the 
Act, but rejected or deferred ruling on many of the Division's other arguments. With minor 
modifications, the DTE approved the Companies restructuring plan, subject to further 
review in a later reconciliation proceeding. 

Western Massachusetts Electric Company, D. T.E. 97-120. As required under the 
terms of the Electric Utility Restructuring Act, on December 31, 1997, the Company filed a 
proposed restructuring plan with the DTE, which it supplemented on January 1 3 and 3 1 of 
1998. Following a review of the Company's proposal and two evening public hearings, the 
Division filed comments with the DTE, arguing that the proposal did not satisfy the 
standards of the Act because, among other reasons, it did not provide the required ten 
percent rate reduction and sought to include inappropriate items as "transition costs" 
eligible for recovery under the Act. On February 20, the DTE approved the Company's 
plan with minor modifications, but indicated that its approval was interim and was subject 
to fiirther review and investigation. On May 15, 1998, the Company proposed a number of 
amendments to its original plan, which, among other things, provided for an additional rate 
reduction of 2.4 percent and modified the original provisions on the divestiture of the 
Company's generating facilities. On June 1, the Division filed comments on the proposed 
amendments in which it supported the additional rate reduction but challenged most of the 
other proposed amendments on the grounds that they were inconsistent with the terms of the 
Act. In an order issued on June 30, 1998, the DTE indicated that the Company could 
propose the amendments, but that, with the exception of the increased rate reduction, it 
would not determine whether the plan as amended would be approved. At the close of the 



214 



fiscal year, proceedings on the final approval of the Company's plan were still pending and 
a procedural schedule had not yet been adopted. 

Fitchburg Gas & Electric Light Company (DTE 97-115) As required under the 
terms of the Electric Utility Restructuring Act, on December 31, 1997, the Company filed a 
proposed restructuring plan with the DTE. Following a review of the Company's proposal 
and an evening public hearing , the Division filed comments with the DTE in arguing that 
the proposal did not satisfy the standards of the Act because, among other reasons, it 
proposed to treat Seabrook related losses as distribution, rather than generation related 
costs, it sought to recover future operating deficits as stranded costs, and it was not 
consistent with the Act's provisions for the pricing of the required "standard offer" power 
service. On February, 26, 1998, the DTE issued an order in which, subject to further 
review, it granted interim approval to the Company's plan. Evidentiary hearings were held 
in March, but briefs had not yet field at the end close of the fiscal year. 

Boston Edison Company (DTE 97-63) On May 28, 1997, Boston Edison filed a 
petition seeking DPU approval for a corporate reorganization that would create a holding 
company (BEC Energy) that would become the corporate parent of Boston Edison. The 
Division intervened and participated in hearings held in the fall of 1998, sponsoring an 
expert witness to support the position that to protect the interest of the Company's electric 
customers, the DPU should, among other things, condition any approval of the Company's 
proposal on adherence to appropriate rules governing asset transfers amongst the affiliates 
within the holding system, dividend polices. In a decision issued on April 17, 1998, the 
DTE approved the Company's proposal without imposing any of the conditions 
recommended by the Division. A limited intervenor in that proceeding, Cablevision 
Systems Corporation, filed an appeal fi-om this decision to the Supreme Judicial Court. At 
the end of the fiscal year, the appeal was still pending. 

Generating Performance Reviews/Fuel Clause Proceedings 

No generating performance review proceedings reached the hearing stage during the 
fiscal year, but Western Massachusetts Electric Company did agree that it would not seek 
recovery of replacement power costs incurred as a result of the extended outages of the 
three Millstone nuclear units in Connecticut. The Division intervened and filed comments 
in a notice of inquiry opened by the DTE (DTE-98-13) in early 1998 in which it solicited 
comments regarding the treatment of any outstanding fuel and purchased power costs 
balances owed by or to utilities at the March 1 , 1998 termination of fuel clause recovery of 
such costs. In these comments, the Division urged the DTE to consider limiting the scope 
of the inquiry to the identification of appropriate mechanisms to address any balances found 
owed or owing in individual company specific filings and the of the number of outstanding 
performance issues for each company. As of the close of the fiscal year, the DTE had not 
yet issued a decision delineating the scope of the proceeding. 

GAS MATTERS 



Base Rate Cases 



71S 



Fitchburg Gas & Electric Light Company (DTE 98-51) In May, 1998, Fitchburg Gas 
& Electric Light Company filed a request to increase its gas rates by $1.55 million (9%). 
Discovery had been issued but a hearing schedule had not been adopted at the close of the 
fiscal year. A decision is expected in this case on November 30, 1998. 

Boston Gas Company (DPU 97-92) On In September 15, 1997, Boston Gas 
Company made its first annual price cap compliance filing to implement the rate plan 
adopted by the DTE in 1996. As amended, the Company's filing proposed new rates and 
charges designed to increase its revenues by rates by $1 .9 million. The Division intervened 
in this proceeding and objected to various elements of the proposal. On November 6, 1997 
the Department issued an order reducing the amount of the proposed increase to $1.7 
million. After the Department approved new rates filed by the Company on November 7 to 
comply with the November 6 decision, the Division sought reconsideration of that decision 
on the grounds that the new rates would collect more revenues than that authorized. 
Following three months of discovery, meetings, and conferences, the Company 
acknowledged that its new rates would result in annual revenues $1 .2 million in excess of 
those permitted by the Department. On March 12, 1998, the Department granted the 
Division's motion and ordered the Company to refund to its customers the excess revenues 
it had collected since November 1 1 (approximately $458 thousand). 

Bay State Gas Company, DP. U. 97-979. Following protracted negotiations, on 
October 9, 1 997 the Division and Bay State Gas Company filed a settlement with the DPU 
under which the Company agreed to refrain from filing a rate case for two years in 
exchange for the adoption of rate plan under which it be allowed to increase its rates by up 
to $1 .8 (0.7 percent) million in each of the next two years so long as it met certain 
investment thresholds. The rate plan also provided for penalties of up to $2 million for 
failing to meet aggressive service quality targets as well as requires the Company to share 
with its customers through a bill credit fifty percent of earnings above 1 1.4 percent and all 
earnings above 15.4 percent. The Department approved the settlement on December 31, 
1997. 

Restructuring 

Unbundling of Natural Gas Distribution Services, D.T.E. 98-32-B. On July 1 8, 
1997, the DPU directed the ten local gas distribution companies to initiate an informal 
process to build a consensus among various interested parties on principles upon which to 
restructure the existing natural gas industry to allow all customers to choose among 
competing suppliers of gas to be delivered by the local distribution company. The Division 
participated in this process, representing the interests of residential and small business 
customers in numerous meetings and technical conferences, urging, among other things, the 
principle that any restructuring or unbundling should not result in an unfair shift of costs 
from large to small customers. On March 18, 1998, the gas companies reported to the 
Department that a broad consensus had been reached on a number of principles but that no 
agreement could be reached on principles to apply to the disposition of the gas companies' 
existing inventory of gas supply capacity and the assignment of responsibility for any 
associated costs. On April 3, 1998, the Department opened a formal notice of inquiry and 
sought comments on these two issues. Acting together with some of the other interested 
parties, the Division filed comments and gave testimony in support of an approach to the 



216 



capacity disposition question that would result in all customers bearing an appropriate share 
of the cost of the capacity costs that the gas companies had incurred. This matter was still 
pending at the close of the fiscal year. 

Miscellaneous 

The Division also intervened on behalf of Massachusetts consumers in various not 
rate proceedings that could affect the rates paid by consumers and which reflect the change 
underway in the gas industry. In Colonial Gas Company/Distrigas Proposal (DPU97-49), 
the Division opposed a joint venture proposed by Colonial Gas Company, the local 
distribution company serving the Lowell and Cape Cod areas, and Distrigas of 
Massachusetts, a wholesale supplier of liquified natural gas from its storage facilities in the 
Boston area. Under the proposal, Distrigas would lease a portion of Colonial's LNG 
storage facility in Tweksbur>' at cost and share with Colonial any profits it made on sales 
from that facility. The Division opposed the arrangement because, unlike the current 
treatment of profits from off-system sales from the Tweksbury facility. Colonial's 
customers would not benefit under the proposed arrangement. Similarly, in Hopkinton 
LNG (FERC 97-156-000), the Division intervened in a proceeding before the Federal 
Energy Regulatory Commission concerning a proposal by Hopkington LNG, an affiliate of 
Commonwealth Gas Company, under which it would sell capacity in its LNG storage tank 
that was not being used by it affiliate and keep the proceeds of such sales. We opposed the 
proposal on the ground that the facility was built to serve Commonwealth Gas Company 
customers and because under the existing terms of the agreement with Hopkington LNG 
Commonwealth Gas Company had an exclusive right to all of the capacity, its customers 
were entitled to any profits from any sales. Both cases were pending at the close of the 
fiscal year. 

TELEPHONE MATTERS 

Massachusetts New Area Codes (DPU 9-90) Following the DTE's January, 1997 
order in which it adopted the geographic split approach to addition of two new area codes to 
address a claimed shortage of available numbers for use in the geographic areas presently 
included in the 617 and 508 area codes, it instituted another investigation to consider 
whether to extend the deadline for callers to use the new area codes. During this 
proceeding, the DTG also considered whether to change the dialing rules for "local" calls 
between area codes that it had adopted in 1993 as means to preserve the value of "1+" 
dialing as a "toll indicator": all "local" calls (those for which a toll charge did not apply) 
between area codes were required to be dialed with only the area code and the number (not 
begin with a "1 "). To assure no lapses in the service provided by alarm companies, the 
Division supported an extension in the permissive dialing period. While the Division 
indicated that the expansion of toll-free calls between area codes resulting from the creation 
of two new area codes might justify some relaxation in the DTE's dialing rules, it urged the 
DTE to hold public hearings on the merits of impairing the value of "1+" dialing as a toll 
indicator. In an order issued in November, 1998, the DTE extended the permissive dialing 
period and, without holding hearings, modified its dialing rules. 

MCI Relay Service DP. U. 96-118 Working with four disability rights advocacy 
groups in regard to complaints over the quality of the "relay service" provided for 



717 



communications to and from deaf and hard of hearing consumers, the Division, together 
with the Attorney General's Disability Rights Project, and after filing direct written 
testimony and exhibits, the Division negotiated and then filed a settlement with MCI and 
Bell Atlantic under which MCI agreed to meet certain specified relay service performance 
standards, to fund monitoring of compliance with those standards through an agreed upon 
program of performance tests, and the payment of liquidated damages if MCI's 
performance on the test does not meet specified levels. On April 8, 1998, the DTE issue an 
order accepting the settlement 

NYNEX Third Annual Price Caps Compliance Filing (DPU 97-67) On June 9, 1997 
NYNEX filed its third armual price caps compliance filing with the DPU proposing to 
reduce residential rates by $49.9 million and business rates by $15.2 million, an overall rate 
reduction of $65.1 million. Approximately $44 million of the total reducfion was to 
recognize the earlier increase for 100 to 250 for the payphone rate. The Attorney General 
intervened and opposed motions by MCI and AT&T to suspend the August 15, 1997 
effective date proposed rate reductions pending a decision on their complaints regarding the 
level of NYNEX's rates. In an order issued on August 12, 1997, the DTE adopted the 
Division's arguments and allowed the rate reductions to go into effect inunediately. 

NYNEX Quality of Telephone Service in the Mission Hill Area of Boston (DPU96- 
30) On July 8, 1997, the Department issued a decision on the February 12, 1996 petition 
filed by twenty-nine customers of NYNEX seeking an investigation into the quality of the 
service provided in Boston's Mission Hill neighborhood. The complaint followed a week 
long outage affecting 293 customers in the area. Working with local community leaders, 
the Division had been an active participant in all phases of the proceeding: discovery, 
evidentiary hearings, and briefing, arguing that the evidence demonstrated an unacceptable 
level of service and preparedness for a significant outage. On brief, the Division 
recommended a complete overhaul of NYNEX's distribution cables, feeder cables and 
ancillary equipment in Mission Hill and proposed an emergency response plan for NYNEX 
to address all future major service outages in the Commonwealth. In its decision, the 
Department did require NYNEX to develop and implement a state-wide emergency 
response plan to activate in the event of major outages in the fixture outage preparedness 
program. 



218 



CONSUMER COMPLAINT 
AND INFORMATION SECTION 

The Attorney General's Consumer Complaint and Information Section ("CClS") 
provides services to individual consumers by responding to thousands of consumer 
complaints and requests for information on consumer issues and referrals on the Attorney 
General's consumer "hotline"; through a voluntary mediation program aimed at resolving 
consumer complaints against businesses which obtains refunds and other savings for 
individual consumers; by educating the public through developing and distributing 
educational materials and participating in consumer education initiatives; by responding to 
public records requests; and by identifying potential trends of unfair or deceptive trade 
practices for ftuther investigation or possible prosecution by the Consumer Protection and 
Antitnist Division. 

For the period July 1, 1997, through June 31, 1998, CCIS received and responded to 
18.829 written complaints and other correspondence; responded to 138.188 telephone calls 
to the Attorney General's consumer hotline, representing an increase of 11. 832 telephone 
calls from Fiscal Year 1 997 ; provided mediation services immediately upon receiving 
telephone requests from 279 consumers experiencing highly time sensitive or particularly 
egregious consumer disputes; mailed consumer educational brochures or pamphlets to 
6.289 consumers; responded to 586 public records requests for copies of consumer 
complaints; opened 2.278 consumer complaints for mediation, and closed 4.752 
complaints, recovering $578.267 in refimds or other savings for individual consumers, 
representing an increase of $85.982 from Fiscal Year 1997; and identified 14 companies for 
fiirther investigation or prosecution by the Consumer Protection and Antitrust Division. 

In Fiscal Year 1998, CCIS continued to focus on further implementation and 
development of the Consumer Complaint Tracking System ("CCTS"). CCTS, a database 
designed specifically for CCIS, allows the Section to perform its hotline, mediation, . 
education, and trend identification responsibilities in the most efficient manner possible. 
CCTS enables staff to respond more efficiently to consumer inquiries and enter consumer 
or merchant information on the hotline and automatically generates cover letters and 
complaint forms with specific complaint numbers which are used in the fixture to access the 
consumer's information. 

CCTS allows staff to scan consumer complaint forms and correspondence into the 
database using an imaging software, so that the actual image of the complaint appears on 
the computer screen; to access information and make referrals to other agencies more 
efficiently by listing federal and state agencies' and local consumer programs' phone 
numbers; to quickly and easily retrieve complaint records filed against a particular business; 
to respond to public records requests by quickly providing the number of complaints filed 
against a particular business with a breakdown by location; to research complaints 
involving particular industries; and to identify patterns or trends of unfair or deceptive 
practices. 

As a result of CCIS' condnued focus on further development of CCTS in Fiscal 
Year 1998, CCTS was installed in 5 local consumer programs. One local program served 
as a test site for the installation of the CCTS database and the transmission of complaint 



7iq 



data. While the testing period was lengthy, it resulted in direct transmission of complaint 
data from the Attorney General's database to the LCP, and the transmission of complaint 
information from the local consumer directly to the Attorney General's database. 

The data transmission process replaces a monthly manual reporting system, and 
greatly enhances the accuracy of the information provided to the public and the press 
concerning the number of complaints on file against a particular business. Four local 
consumer programs are presently being trained to utilize the tracking system, and should 
soon be transmitting data. The major goal for Fiscal Year 1999, is to complete installation 
and training of the remaining 14 local consumer programs, so that manual data entry is no 
longer required, and the database is entirely accurate to the day. 

CCTS was further enhanced by the extensive refinement and expansion of the 
business and complaint types codes. Numerous business codes were added, and within 
each business type, complaint types were created which identify certain practices or 
violations of the law. 

These codes are assigned to each complaint entered into the database, thereby allowing the 
user to search for complaints by complaint type, rather than by the business name. For 
example, if the Consumer Protection and Antitrust Division was unaware of a particular 
company violating the law, but was interested in bringing litigation for a specific violation 
or practice, CCTS can search the database by the complaint type, thereby identifying 
companies against whom complaints were filed alleging a certain violation or practice. 

CCIS receives approximately 100 consumer complaints and other correspondence 
each day. Every letter or complaint form is read, screened for appropriate action by CCIS 
or referred elsewhere, and is entered into the CCTS database. Every individual who files a 
complaint or writes a letter, receives a computer generated letter informing them of the 
outcome. A major initiative in Fiscal Year 1998, was the stream-lining and editing of the 
existing computer generated letters. Previously, there were approximately 50 letters from 
which staff chose the appropriate response. As the result of our efforts, there are now 20 
letters which are more succinct, accurate, and informative. These new letters have greatly 
increased the rate at which we read and screen the large volume of mail received at CCIS. 

In Fiscal Year 1998, CCIS confinued to focus on consumer education initiafives; 
three interactive computer quizzes concerning consumer, labor, and housing issues were 
developed in conjunction with MIS for the public's use at outreach events; a new brochure 
concerning mortgages was written; and CCIS staff conducted or participated in numerous 
community based consumer educafion initiatives in which they answered questions and 
distributed consumer educational materials. These consumer education initiafives took 
place, in cooperation with the MBTA and the Fleet Center, at the North Station Commuter 
Rail; the Attorney General's educational booth at "The Big E," the Eastern States Fair; the 
Home Show; and at a Nafional Celebration of Aging inifiative held at the Kennedy Federal 
Building. 

CCIS staff also spoke before community groups and students to provide information 
to the public on their rights as consumers and in specefic areas including student loans, and 
telemarketing fraud. These consumer education events were held at high schools, junior 



220 



highs, colleges, on community radio, and in conjunction with local police departments, at 
elderly housing complexes. 

The Section maintained the increase in the number of interns participating in the 
undergraduate mediation internship program and broadened recruitments efforts to fiirther 
diversify the pool of participants. CCIS staff provided staffing and training to the AG Elder 
Hotline and participated in Bureau and Office-wide initiatives including the Diversity 
Committee, the Language and Literature Committee, the National Association of Attorneys 
General Telemarketing Group, and the Supreme Judicial Court's Racial and Ethnic Bias 
Committee. Lastly, CCIS staff provided complaint information to and testified before the 
Senate Post Audit and Oversight Committee concerning home inspection related complaints 
and inquiries. 



77^ 



FY 98 Mediation Services Department 
Highlights 



Administered $1,077,750 in grants to 22 SCORE programs, 63 SCORE Training Grant 
Schools and 9 Face to Face Mediation Programs serving 62 Massachusetts 

communities 



SCORE programs conducted 2,443 peer mediations and successfully resolved 98% 



Face to Face Mediation Programs conducted 1 ,829 mediations, successfully resolved 83% 
and returned $545,322 dollars to consumers 



Designed and Delivered 3 CIT Trainings to increase the number and 
diversity of CIT mediators 



Created the SCORE newsletter Keeping SCORE 
and published 3 issues 



Conducted 6 SCORE trainings and trained 103 of 220 new SCORE mediators 



Welcomed 2 new programs: A SCORE program in Holyoke and a 
Face to Face Mediation Program in Greenfield 



Delivered 10 workshops and 10 presentations on SCORE and CIT 
at local, state and national conferences and OAG events 



Represented OAG at 5 public events in Weymouth, Byfield, Boston, Springfield 

and Worcester 



Conducted 14 SCORE site evaluations 

Designed and delivered a 3 day "Intro to Mediation Skills" training to OAG staff 

Mediation Services Department FY 98 Annual Report 
Introduction 

222 



The OAG Mediation Services Department is located in the Consumer Protection 
Antitrust Division of the Public Protection Bureau. It consists of 7 staff, 1 Director, 1 
Deputy Director, 1 Administrative Assistant, 3 Regional Coordinators and 1 Grant 
Coordinator. The three major programs overseen by MSD are: the Student Conflict 
Resolution Experts Program (SCORE), the Conflict Intervention Team (CIT) and the 
Face to Face Mediation Program (FTFMP). 

Face to Face Mediation Programs 

In 1984, the OAG initiated 3 pilot Face-to-Face Mediation Programs (FTFMPs) in 
Worcester, Somerville and Haverhill. These pilot programs were initiated to provide 
consumers with an alternative to court action . FTFMPs train volunteer mediators to 
mediate consumer disputes. As a result of the success of the 3 pilot programs, FTFMP 
service was expanded and now serves consumers in Lowell, Hyannis, Fitchburg, 
Brockton, Springfield and Greenfield. Consumer complaints are referred to FTFMPs by 
the courts, police, community agencies and OAG affiliated local consumer programs. 

A new FTFMP program was added this year in Greenfield. This program is 
administered by the Mediation and Training Collaborative (a local community mediation 
program). FTFMPs in Haverhill and Hyannis received consultation and technical 
assistance from MSD staff (Kathy Grant, Darlene Skog and Sandra Washburn) to enhance 
programmatic procedures. Two site visits to FTFMPs in Fitchburg and Brockton were 
also conducted. 

In FY 98, the nine FTFMPs received 4,096 referrals and conducted 1,829 face to 
face mediations with 83% successftilly mediated. A total of $545322 dollars and services 
valued at $78,780 were returned to consumers served by FTFMPs. 

Student Conflict Resolution Experts 

SCORE is an award winning, comprehensive school-based student mediation 
program. Since its inception in 1989, SCORE programs have mediated 11,110 student 
conflicts with 10,798 reaching agreement resulting in cumulative mediation success rate of 
97%. In the SCORE program model, an adult coordinator is hired by the SCORE grant 
recipient (a community mediation program) to administer the SCORE program at the 
school. The community mediation program provides local program oversight and assists in 
the training of student mediators. 

In academic year 1997-98 there were 22 SCORE programs operating in 14 
communities: Worcester (Bumcoat Sr HS), Somerville (Somerville HS), Boston 
(Cleveland MS, Curley MS, English HS, Boston HS, Brighton HS), Lynn (Lynn Classical 
HS, Lynn English HS, Lynn Technical HS), Springfield (Chestnut MS), Dartmouth 
(Dartmouth HS), Taunton (Taunton HS), Fall River (Durfee HS), Maiden (Maiden HS), 
Medford (Medford HS), Wakefield (NE Metro Tech HS), Lowell (Lowell HS), Pittsfield 
(Reid MS, Herberg MS) and Holyoke (Holyoke HS). A new SCORE program was added 
in Holyoke at Dean Technical High School. The Dean Tech program is a pilot "SCORE 
Mentor" program. In the SCORE Mentor program, a teacher staffs the program full-time in 
accordance with SCORE guidelines and receives oversight from an experienced mediation 



??^ 



mentor. During academic year 1997-98 SCORE programs conducted 2,443 peer 
mediations and successfully resolved 98yo. 

Annual site visits were held at 14 of the 22 SCORE programs during the last quarter 
of the school year (April-June). Armual site visits enable MSD to conduct field evaluations, 
facilitate needed program improvements, troubleshoot problems and interact with local 
school officials. During the annual site visit, questionnaires are administered to SCORE 
coordinators, school principals, student mediators and SCORE grant recipients. 
Information gathered from the annual site visits is used to develop SCORE program 
priorities. Informal site visits are also conducted throughout the school year to assess 
program performance and assist with problem- solving. 

Training Grants 

In FY 98, $420,750 of the grant funds allocated to SCORE fi-om settlement monies 
were used to help schools to start-up or enhance existing peer mediation programs and to 
promote quality peer mediation training. Fifty-seven SCORE Training Grants were 
awarded for the 1997-98 and 1998-99 academic years. All Massachusetts public schools 
(grades 6-12) received notice of the availability of SCORE Training Grants. 

Twenty-eight SCORE Training Grants for 1997-98 in the amount of $208,750 were 
awarded to schools in: Holbrook (Holbrook Jr/Sr HS), Williamstown (Mt. Greylock 
Regional HS), Hanson (Indian Head MS), Attleboro (Wamsutta MS, Brennan MS, Coelho 
MS), Byfield (Triton Regional HS), West Springfield (W. Springfield JHS), Dracut 
(Engleby HS), Somerset (Somerset Jr/Sr HS), Peabody (Peabody Veterans Memorial HS), 
Stoughton (O'Donnell MS) Framingham (Framingham HS, Walsh MS, Fuller MS), 
Brookline (Runkle MS), Orange (Mahar Regional HS), Athol (Athol-Royalston Regional 
HS), Milford (Milford HS), Walpole (Walpole HS), Tyngsboro (Gtr. Lowell Technical 
HS), Marlborough (Marlborough HS), Bridgewater (Bridgewater/Raynam HS), North 
Eastham (Nauset Regional HS), Westfield (Westfield MS), Swansea (Case JHS), Turners 
Falls (Gtr.Falls MS), Swampscott (Swampscott HS), Winchendon (Murdock MS/HS), 
Weymouth (Weymouth Jr/Sr HS), Northbridge (Northbridge MS/HS) and Fall River 
(Diman Regional HS). 

Twenty-nine SCORE Training Grants in the amount of $212,000 were awarded for 
academic 1998-99 to schools in: Arlington (Arlington HS) , Boston (Boston Latin 
Academy, Boston Latin School, Timilty MS, Snowden HS), Lexington (Lexington HS), 
Medfield (Medfield HS), Mattapoisett (Old Rochester JHS), Swansea (Case JHS), 
Foxborough (Foxborough HS), Gloucester (Gloucester HS), Lowell (Robinson MS, 
Rogers MS, Sullivan MS), Peabody, (Higgins MS) Winthrop (Winthrop HS), Newton 
(Newton South HS), West Springfield (West Springfield JHS), Stoughton (Stoughton 
HS), Braintree (East MS), Framingham (combined grant to Framingham HS, Fuller and 
Walsh MS) South Deerfield (Frontier Regional HS), Hadley (Hopkins Academy), 
Rochester (Old Colony Regional Technical HS), North Reading (North Reading HS), 
Beverly (Beveriy HS), Fitchburg (Montachusett Technical HS), Westford (Nashoba 
Valley Technical HS) and Provincetown (Provincetown HS). 



224 



With the addition of the 57 SCORE training grant affiliates to the existing roster of 
22 SCORE programs, SCORE is represented in 56 Massachusetts communities. 

The Conflict Intervention Team 

The CIT is comprised of a team of specially trained community mediators that can 
mobilize on a moments notice to provide emergency mediation service to schools in crisis 
or on the verge of a crisis. In most instances, MSD staff oversee CIT mediators during an 
intervention. Since there were no interventions conducted during the 97-98 school year, 
CIT focused attention on capacity-building and increasing diversity of the pool of CIT 
mediators. Three CIT trainings were held this year training an additional 20 student CIT 
mediators, 13 CIT coordinators and 16 adult CIT mediators. 

This year CIT received a grant of $40,000 from the Massachusetts Department of 
Education to support the work of CIT and a three-year $150,000 grant from the Hewlett 
Foundation to support CIT enhancement and replication. MAMPP, the Mass. Assoc, of 
Mediation Programs and Practitioners, was the official grant recipient for both grants and is 
administering the funds. CIT used a portion of these grant monies to fund a part-time CIT 
program coordinator position. The CIT program coordinator, Xavier Velasco Suarez, was 
hired in May and works on-site at MSD. 

Trainings 

MSD staff led 6 SCORE trainings and trained 103 of the 220 student mediators 
trained in FY98. Other trainings conducted by MSD included a 30 hour adult community 
mediation training for the new South Boston Community Mediation Center and a 3 day 
"Intro to Mediation Skills" training conducted by MSD for 20 OAG staff. An advanced 
skill-building training was held for 1 7 SCORE mediators from NE Metro Tech HS in 
Wakefield. 

Innovations 

In 1994, OAG won a prestigious national award from the Ford Foundation for its 
SCORE and CIT programs. The $100,000 award was used to disseminate information 
about these programs and to encourage their replication. During FY 98, MSD expended the 
remainder of the award money by providing a CIT replication training for commimity 
mediators in Las Vegas, Nevada. Kathy Grant and Sandra Washburn led the 2 day CIT 
replication training. MSD continues to disseminate the informational packets, brochures, 
posters and videos developed with Innovations award funds. 

Public Events, Conferences, Workshops 

During the year, MSD staff participated in 6 public events: in Weymouth and 
Byfield at peer mediation graduation ceremonies; in South Boston at a community 
mediation graduation; in Springfield at the city-wide peer mediator swearing-in; in 
Brockton at the Greater Brockton Center for Dispute Resolution (formerly the Brockton 
Court Mediation Program) open house; and in Fitchburg at the 10 year anniversary 
celebration for North Central Court Services. 



->1^ 



MSD staff delivered 10 SCORE workshops at OAG state and national conferences 
in Holyoke, Amherst, Weston, Boston, Mashpee and Worcester. Ten SCORE 
presentations were delivered in Randolph at the Norfolk County Juvenile Justice Summit; 
in Weston at the Developing a School-Based Response to At-Risk Youth Project Alliance 
Conference; in Mashpee at the Cultural Awareness Education Forum; in Hyannis at the 
annual conference of school superintendents and school committee members 
(MASS/MASC); in Boston at the UMASS graduate program on dispute resolution; in East 
Boston at East Boston HS; in Quincy at Quincy HS; and in Weymouth at Weymouth JHS. 
MSD also gave SCORE presentations to foreign visitors including Mr. Joan Puigdollers, 
councilman from the "Convergencia I Unio" Party Coalition in Spain and three visiting 
dignitaries doing research on school violence prevention programs from the 
Israel/Palestinian Center for Research located in the Palestinian Authority, the Ministry of 
Foreign Affairs in Singapore and the Peace Initiative of former Tanzanian President 
Nyerere. 

Community Outreach 

Outreach projects in FY 98 included continued participation in on-going and new 
statewide activities. Kathy Grant has joined the Permanency Mediation Coalition and 
continues as a member of the Supreme Judicial Court Standing Committe on Dispute 
Resolution ADR Task Force serving on the Rules Implementation and Qualifications sub- 
committees. Darlene Skog continues on the steering committee of the Massachusetts 
Violence Prevention Task Force (MVPTF) and as SCORE outreach project coordinator. 
Sandra Washburn serves on the MVPTF Prejudice Reduction Violence Prevention sub- 
committee and Steve Lilly- Weber was appointed to the MAMPP board. This year 
Mediation Week was celebrated May 3-9 and Steve Lilly- Weber served as the OAG/MSD 
liaison to the Mediation Week planning committee. Steve coordinated the mediation week 
exhibit featuring SCORE, Face to Face Mediation and CIT that was displayed in the lobby 
of the McCormack Building during Mediation Week. 

Additional outreach activities in FY98 included: a comprehensive statewide 
mailing of SCORE program materials (poster, brochure and statistics) to school 
superintendents, principals, coordinators, grant recipients, mayors, school committees, state 
senators and representatives and local newspapers; publication of 2 articles on SCORE in 
the May /June/July Issue of the Fourth "R" (an international peer mediation newsletter) and 
in the upcoming September issue of "News in School Health", published by the MA Dept. 
of Public Health; SCORE featured in two books, Restoring Juvenile Justice: An 
Exploration of the Restorative Justice Paradigm for Reforming Juvenile Justice, and the 
Massachusetts Prevention Resource Guide; and 11 newspaper articles on SCORE 
programs and 17 press releases announcing SCORE Training Grant Awards. 

SCORE also received television coverage from Ch-56, CH-6, CH-12, CH- 4 and 
cable CH-40. Dartmouth SCORE coordinator Kim Hebert was interviewed by Ch-56, Ch- 
6 and Ch-12 about SCORE and how it prevents school violence the day after the Jonesboro 
school shootings. Alice Comack from Somerville HS SCORE was also interviewed by Ch- 
4. In May, Ch-4 featured SCORE student mediators from Boston English HS in its focus 
piece on children who witness violence. In the western part of the state, local cable Ch-40 
featured a clip of SCORE student mediators at the Averting School Crisis Conference in 
March. 



226 



PUBLIC PROTECTION BUREAU 
CHIEF PROSECUTOR 

The Chief Prosecutor of the PubHc Protection Bureau is responsible for the 
investigation and criminal prosecution of crimes related to the priority areas of the Bureau 
and AttomeyGeneral Harshbarger. The Chief Prosecutor, to whom has been added one fiill 
time Assistant Attorney General in addition to access to the Bureau attorneys, insures that 
the Bureau is able to protect the public interest through both civil and criminal means. 

The Chief Prosecutor focuses on solving complaints by considering creative 
approaches to a myriad of crimes that traditionally have gone unprosecuted. Criminal cases 
are begun when investigations are completed and a determination that criminal litigation is 
appropriate. On some occasions, investigations lead to a determination that civil or 
administrative remedies are more appropriate and will result in a better outcome for the 
Commonwealth. When patterns demonstrate the need for improved legislation, the Chief 
Prosecutor, in conjuction with the Bureau Chief, writes the legislation and builds consensus 
with legislators and administrative agencies. Statewide training for prosecutors and police 
is performed when novel areas of enforcement, such as home improvement contractor fraud, 
demonstrate a need for improved methods of investigation and prosecution. 

Primary areas for criminal investigation include consumer related crimes, including 
home improvement contractor fraud, elder fraud and abuse, health care fraud within the area 
of private insurers, the unauthorized or unlicensed practice by certain professionals such as 
dentists, doctors or public accountants, crimes relating to charities and telemarketing fraud. 
An emphasis has been placed upon the application of criminal remedies to areas of criminal 
activity that my fall outside the penumbra of traditional law enforcement. 

I. HIGHLIGHTS OF CASES PROSECUTED TO COMPLETION 

DPS Dental Center 
Health Care Fraud 

The principal dentist and a periodontist of a dental center were indicted and 
convicted of private insurer health care fraud. More than two hundred complaints were 
registered with the Office of the Attorney General and the Division of Registration. These 
matters were resolved using both criminal and civil dispositions to gain restitution for all 
victims and to provide future fimding for dental services for uninsured children. The efforts 
were also coordinated with the Division of Registration. 

The defendants Weissman, Anusavice and MassDent Inc., pleaded guilty to criminal 
indictments alleging health care fraud and signed a civil consent agreement as part of a 
global settlement of the complaints lodged against them. In the criminal matter, defendants 
paid $170,000 forthwith to a fund for all DDS victims (not just those involved in the 
criminal matter) and were placed on criminal probation in addition to probation with the 
Board of Registration in Dentistry for five years. The defendants lost their dental licenses 
for five years and were ordered to perform three hundred hours of community service. In 
the civil settlement the defendants were ordered to pay an additional $75,000 to CMHC 



111 



insurance and an additional $55,000 to the consumer fund. After their five year license loss, 
the defendants will be on probation with the Board of Registration in Dentistry requiring 
ethical, educational and substance abuse training. 

Pursuant to the civil consent judgment another periodontist. Abbas Ghorieshi, lost 
his license to practice dentistry for one year and had to pay approximately $100,000 of the 
amount assessed against Weissman and Anusavice. MassDent corporation, the parent 
corporation of DDS Dental Centers was also put out of business. 

Am-TechAVilbur Brown 
Telemarketing/Business Opportunity Fraud 

The Chief Prosecutor was appointed to be a special assistant United States 
attorney in order to work with an assistant United States attorney in prosecuting an 
egregious scheme selling private pay telephones. Based upon complaints received by 
Attoreny General Harshbarger's Consumer Hotline, sixty indictments were obtained and 
prosecuted in Federal Court. A proposed plea agreement is pending wherein the defendant 
Wilbur Brown will serve five years in federal prison, concurrent with state prison time he 
will serve in Florida. If the plea agreement is accepted by the judge, Brown will also ahve 
to pay over $800, 000 in restitution. 

The initial investigation by investigators assigned to the Public Protection Bureau 
and State police also led to a civil injunction which froze Amtech's bank accounts. 

Robert Hernandez/ Patricia Loughlin 
Unauthorized Practice of Nursing Prosecutions 

District Court complaints were issued in response to the discovery that Robert 
Hernandez was working in a nursing home as a nurse without a license after faking his own 
death and submitting a phony death certificate. 

Hernandez pleaded guilty to unlicensed nursing, forgery and uttering in the 
Lawrence District Court, and was sentenced to two years in the House of Correction 
suspended for two years. He was placed on probation for four years, banned from the health 
care field and ordered to perform 250 hours of community service. The prosecution 
garnered widespread media attenfion and has led to increased vigilance in the nursing home 
industry to the verification of nursing credentials. 

The prosecution of Patricia Loughlin, who passed herself off as a registered nurse 
for several years while working as the in-house nurse for a corporation led to her matter 
being continued without a finding. Ms Loughlin is banned from the health care field and 
must complete 250 hours of community service. 

Frank Cox 
Home Contractor Fraud 

In response to a situation where several local police deprtments had received several 
unusual complaints involving unrelated scams, the Chief Prosecutor brought the complaints 



228 



together to investigate them as a common scheme. Cox was indicted for violating the home 
contractor fraud statute and as a habitual criminal based upon his prior criminal record of 
convictions. Following his indictment. Cox pleaded guilty to a 3 to 4 year state prison 
sentence within three months of his arraignment. 

This case served as the basis for improvements in the BBRS procedures as Cox was 
a registered home contractor despite his extensive criminal record and the fact that his 
check for the registration fees was returned due to insufficient funds. 

The case also made a contribution to the development of proposed identity fraud 
legislation in Massachusetts with regard to the use of a fraudulent identity as a means of 
circumventing restraining orders under M.G.L. 209A. 

Sean Wagner 
Home Contractor Fraud/Larceny from Elders 

After defaulting on his probation and pending criminal charges for two years, 
Wagner was prosecuted in three District Courts for driveway paving scams involving the 
elderly. At the time that the complaints were initiated, Wagner was in violation of 
conditions of probation for prior convictions of larceny from an elder. The probation 
violations were used as a means to promptly dispose of the new complaints which included 
18 months incarceration in the House of Correction and a two year suspended sentence 
which ran concurrently with the period of incarceration. This case served as the basis for 
state wide training of prosecutors and probation officers on the effective use of probation 
surrenders in matters of home contractor fraud. The case also formed the basis for proposed 
legislation regarding pavers in the Home Improvement Contract Fraud statute. 

Pegasus Ventures/ Charles and James Caffarella 
Civil Contempt/Investment Fraud 

Two brothers who had been the subject of a civil consent judgment were prosecuted 
for continuing to run their fraudulent "venture capital" operation. They were also 
prosecuted for being unlicensed investment advisors. Charles Caffarella was sentenced to 
serve a year in the house of correction and the brothers were ordered to pay $ 1 3 1 ,00 in 
restitution during their five year criminal probation. The brothers also may not act as 
investment advisors during their probation. 

John Flynn/Alonzo B. Reed Inc. 
Embezzlement of Employee Insurance Funds 

Flynn, the owner of an architectural firm was indicted for larceny and tax violations 
after embezzling from accounts holding funds intended for employee insurance benefits. 
The AGO also referred the results of its investigation to the United States Attorney's Office 
leading to indictments for bankruptcy fraud. A joint state federal resolution was worked out 
which led to Flyrm being committed to a Federal halfway house for four months. Flynn is 
on both State and Federal probation and must pay restitution of $27, 923 to state victims. 

Paul Zammuto 



?7q 



Assault and Battery on a Disabled Person 

As a result of a referral from the Department of Mental Retardation, a health care 
worker working in an assisted living facility was charged and convicted of two counts of 
assault and battery on a disabled person. The victim suffered severe facial bruises. Over the 
Commonwealth's objection, the defendant's case was continued without a finding for 
eighteen months with supervised probation. A term of the defendant's probation is that he is 
barred from working in the health care field or in any health care facility. If the defendant 
violates his probation, he will be incarcerated for six months. 

II. Cases Closed By Means Other Than Criminal Prosecution 

The Chief Prosecutor of the Public Protection Bureau uses means other than 
criminal prosecution to resolve cases. Investigations may lead to civil remedies or 
injunctive relief Cases may be concluded through civil assurances of discontinuance. When 
appropriate, advisories are published which educate consumers and alert them to areas 
where they could become victims. Conversely, the advisories serve as guides for businesses 
and enable a business to avoid practices that could violate criminal statutes. 

Cases are jointly investigated with and referred to other agencies when appropriate. 
A number of joint criminal investigations are ongoing with the United States Attorney's 
Office. In addition to the federal government, the Chief Prosecutor worked with the 
Division of Registration, Board of Medicine, Secretary of State's Office, Department of 
Revenue and other state's Attorneys General. 



III. Referrals Evaluated 

The Chief Prosecutor evaluated hundreds of complaints during this year. The 
complaints came from a variety of sources including other divisions within the Office of the 
Attorney General, police departments, outside agencies, attorneys and private citizens. A 
large volume of complaints were generated by Attorney General Harshbarger's Elder 
Hotline, Consumer Hotline and Insurance Hotline. Complaints to these Hotlines that 
involved criminal behavior, not being handled by local District Attorney's offices are 
assessed and investigated by the Chief Prosecutor or investigators assigned to the Public 
Protection Bureau. 

IV. Initiatives 

The Chief Prosecutor and assistant attorney general's and investigators working 
under his direction embarked upon a project to increase and improve statewide prosecution 
of home improvement contractor fraud. By seeking out and investigafing the most 
egregious complaints of this type of fraud, a prototype prosecution manual was developed 
for use by local police and prosecutors. All legal and investigative documents were placed 
on computer disk and distributed at a state wide conference attended by over 1 20 local 
police, prosecutors, probation officers and representatives of the Board of Building 
Regulations and Standards and the Department of Consumer Affairs. As an offshoot of the 
training, the Attorney General's office handles home improvement fraud complaints from 



230 



around the state and acts in advisory capacity to local assistant district attorney's handling 
theses cases. Suggestions for improvements in the Home Improvement Statute are being 
collected and are expected to be the basis for amending the Statute in a future legislative 
session. 

An initiative on coordinating with other state Attorneys General and Federal 
authorities on interstate telemarketing initiatives is underway. The initiative has led to 
convictions, such as the aforementioned convictions of Wilbur Brown and an ongoing 
state/federal and civil/criminal investigation into charitable telemarketing fraud which led to 
the issuance of an arrest warrant for a Canadian National and the execution of five search 
warrants in three states. In addition, an assistant attorney general has coordinated with the 
National Association of Attorney's General in order to implement multi-state enforcement 
in this area. 

In addition, the review of proposed legislation and court initiatives was a priority. 
The Chief Prosecutor drafted identity fraud legislation co-sponsored by the Attorney 
General. That legislation passed the Senate without opposition as an amebdment to an 
existing bill, and is being contemplated by the House of Representives. 

Legislation is also being developed with the Division of Registration to prohibit 
health care defrauders whose professional license has been revoked, from owning clinics. 

IV. Training and Publications 

The Chief Prosecutor and attorneys working with him act in an advisory capacity to 
all Public Protection Bureau personnel. Training was held in home improvement contractor 
fraud, search and seizure, pre-trial motions to suppress and introduction to the criminal 
process. Training on criminal prosecution of financial and physical abuse of elders was 
presented to the Elder Law Advocates Strike Force. The Chief Prosecutor was also a guest 
lecturer at Harvard University Law School's criminal law clinic and has appeared on New 
England Cable News News Watch. 

Substantial input was provided regarding the proposed guidelines for probation 
surrenders and proposed revisions to the Massachusetts Rules of Criminal Procedure. The 
Chief Prosecutor co-authored a chapter in an upcoming MCLE publication, Massachusetts 
Superior Court Criminal Practice Manual and authored the lead article in the National 
Association of Attorneys General Health Care Fraud Report (December/January. 1998) 
entitled "Using Health Care Fraud Statutes to Attack Multi- Dimensional Consumer 
Frauds". 

The Public Protection Bureau continues to send assistant attorneys general to the 
District Court rotation program which enables them to gain valuable courtroom experience 
which they bring back to the criminal cases in the bureau. 



9^1 



GOVERNMENT BUREAU 

The Government Bureau provides representation for the Commonwealth and its 
agencies and officials in ail 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 Attorney General's environmental enforcement fiinction 
also falls within the Government Bureau. In addition, the Bureau includes a special unit 
that focuses on civil cost recovery in the $10.8 billion Central Artery/Tunnel Project. 

A major priority of the Bureau is improving the functions of government. Many of 
the cases and initiatives discussed below reflect that priority. In addition, bureau attorneys 
have advised agencies in numerous ways how to reduce accidents and legal errors, thereby 
eliminating liability and injury to the public. The Bureau also provides general 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 1998 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. Meetings with all agency general counsel were held in September of 1997 and 
April of 1998. Also in April of 1998, we published the seventh 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 1998, several 
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 other, so as to broaden 
the exposure of the attorneys to the full range of cases the divisions handle. In addition, a 
number of particularly complex and significant cases were handled by teams assigned to 
multiple divisions. All three divisions 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 also has three specialized functions: the legal review of all newly enacted town by- 
laws; the preparation of legal opinions for constitutional officers, heads of agencies, and 
certain other officials concerning issues arising from the performance of their official 
duties; and the review of proposed statewide initiative and referendum questions under 
amendment article 48 of the Massachusetts Constitution to determine whether such 
questions are of the type that may lawfully appear on the ballot. 

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 violations, employment disputes and environmental 
damage claims. The Trial Division also reviews certain contracts, leases, bonds and various 
conveyancing documents submitted by state agencies for approval as to form. 



232 



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. The 
Environmental Protection Division also plays a key role under the Clean State initiative to 
ensure that the Commonwealth's own agencies abide by state and federal environmental 
laws, and in doing so the Division may bring enforcement actions against those agencies 
where the Attorney General, in his enforcement discretion, deems such action necessary. 
There is significant overlap between the other divisions of the Government Bureau and the 
Environmental Protection Division in substantive legal issues addressed in litigation, the 
nature of the litigation and interactions with agencies. The organization of these divisions 
within one bureau promotes the sharing of resources and expertise, and the coordination of 
positions taken in cases. In addition, this organization makes the substantive expertise of 
the Environmental Protection Division more readily available to other agencies in 
environmental matters. 

Finally, in fiscal year 1998 a new unit was formed within the Government Bureau to 
focus on civil cost recovery in the $10.8 billion Central Artery /Tunnel Project ("CA/T 
Projecf ). The work of the CA/T Project Civil Cost Recovery unit, presently made up of an 
attorney director and support staff, often is performed jointly with the Criminal Bureau or 
the Business and Labor Protection Bureau. The unit has diverse responsibilities with 
respect to the CA/T Project in addition to the investigation and prosecution of fraud cases 
and other cost-recovery matters, including: participation in the activities of the CA/T 
Project Oversight Coordination Commission; working with CA/T Project personnel and 
counsel to implement effective cost-containment and anti-fraud measures, including 
procedures to reduce the incidence and cost of defensive litigation; and the promotion of 
legislation that would facilitate civil cost-recovery actions by the Commonwealth. 

Affirmative Litigation 

In the crucial area of tobacco litigation, as discussed in the Public Protection Bureau 
section, the Government Bureau, in conjunction with the Consumer Protection and Antitrust 
Division, continued to pursue its 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 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 fimding of a '"corrective" 
public education campaign about smoking, health and addiction. 

In addition to the tobacco litigation, the Government Bureau maintained an active 
docket of affirmative litigation in fiscal year 1998 to assert the public interest and the 
interests of its state agency clients. In Attorney General v. McHatton . a quo warranto action 
challenging whether a candidate elected as a Chelsea City Councillor could take office 
despite city charter provisions making persons previously convicted of misconduct in office 
ineligible to serve, the court entered a preliminary injunction agreeing that the defendant 
was barred from taking office. In the Commonwealth's Asbestos Litigation, defendants 
have appealed $1.5 million of a $4 million judgment for the Commonwealth. In addition, 
the Commonwealth is now in litigation with the various insurance companies which had 



233 



issued policies insuring the defendants but which have declined to pay even the portion of 
the judgment that is not subject to appeal. In Michigan v. Department of Energy , a federal 
Court of Appeals held that while the failure of the federal DOE to start accepting high level 
radioactive waste by January, 1998 violated the federal Nuclear Waste Policy Act, the 
remedies for that violation are limited to rights under contracts between the utilities and 
DOE. The Commonwealth will join many other states in filing a petition for a writ of 
certiorari in the U.S. Supreme Court. 

In Commonwealth v. All Brands , the Bureau filed an action under the Massachusetts 
Bottle Bill and Consumer Protection Act against a beverage container redemption center 
and its owner for consistently misstating the number of containers and including ineligible 
containers in redemptions at Massachusetts beverage distributors. In the Electric Mutual 
Life Insurance Company (EMLICO) litigation, the federal district court granted the 
Bureau's motion to remand the case to the Massachusetts Supreme Judicial Court. The 
Bureau will ask that Court to appoint the Massachusetts Commissioner of Insurance as a 
receiver for EMLICO. 

In Commonwealth v. Daley. National Marine Fisheries Service, et al. . the federal 
District Court granted the Bureau's motion invalidating a federal regulation imposing an 
unreasonably low quota on Massachusetts fishermen's scup catch. There is an appeal 
pending in the First Circuit. In Commonwealth v. C.P. Chemical , the Bureau entered into 
an Agreement for Judgment under which the defendant would pay $55,000 to the 
Commonwealth's Urea Formaldehyde Foam Insulation Trust Fund. In the Wheatstone 
Bakery case, a Boston bakery entered into a consent judgment under which it would be 
licensed by the Department of Public Health and would remediate its sanitary code 
violations. 

In Commonwealth v. TLT Construction Co. . the Bureau continued to pursue an 
action filed on behalf of the Trial Court and the Division of Capital Planning and 
Operations to recover damages ft-om the contractor, architect and others alleged to be 
responsible for defects in the design and performance of the renovation of the exterior of the 
Suffolk County Courthouse. Similarly, in Commonwealth v. Ruggles Center Joint Venture, 
et al. . the Bureau continued to pursue its action for damages against the owner, general 
contractor and various other parties to recover the Commonwealth's losses in connection 
with indoor air quality problems that required the Registry of Motor Vehicles to vacate its 
headquarters at Ruggles Center. 

The matter of Commonwealth v. Wilkerson was resolved without litigation by a 
disposition agreement, under which a state senator and her campaign committee agreed to 
provide documentation to the Office of Campaign and Political Finance concerning her 
campaign expenditures from 1992 through 1995 and pay $1 1,000 in civil forfeitures; and 
the senator agreed to reimburse her campaign committee for certain improper campaign 
expenditures. 

Amicus Curiae Briefs 

The Commonwealth's position was adopted by courts in a number of cases in which 
Government Bureau attorneys filed amicus briefs. In Protective Life Insurance Co. v. 
Sullivan , we filed an amicus brief on two questions of law, certified to the Supreme Judicial 



234 



Court by the United States Court of Appeals for the First Circuit, in the case of an 
individual who failed to disclose his HIV positive status when purchasing a life insurance 
policy. The Supreme Judicial Court opined that (1 ) the insurance company was barred, by 
statute, from contesting the validity of a life insurance policy on the basis of fraud more 
than two years after the date of issue; and that (2) the incontestability period was not 
equitably tolled by the defendant's failure to apply for the disability waiver to which he was 
entitled until two years after the policy was issued. In Boston Gas Co. v. City of Newton , 
we filed an amicus brief challenging, as inconsistent with state law. the validity of a city 
ordinance imposing a fee on public utility companies as a prerequisite to acquiring 
excavation permits. The court upheld the ordinance insofar as the fee was based on the 
administrative costs of issuing permits but held the ordinance invalid insofar as the fee was 
based on the city's maintenance and inspection costs. In Loffredo v. Center for Addictive 
Behaviors , the Supreme Judicial Court adopted the position taken in our amicus brief, that 
no implied private right of action for damages would be recognized on behalf of a patient 
for a private clinic's alleged violation of a state agency's regulations. 

In Duracraft Corp. v. Holmes Product Corp. . we filed an amicus brief expressing 
views on the proper interpretation of the anti-SLAPP-suit statute, G.L. c. 231, § 59H, and 
urging the Supreme Judicial Court to hold that the statute was constitutional even when 
applied to commercial disputes like the one raised in that case. The court upheld the statute, 
although on grounds other than those urged in our brief In Kelton Corp. v. County of 
Worcester , we filed an amicus brief urging the Supreme Judicial Court not to depart from 
tradition by permitting a private judgment creditor of a county to levy on real estate owned 
by the county—specifically, the building housing the Uxbridge District Court. Because the 
Commonwealth assumed liability for the debts of Worcester County on July 1, 1998, the 
court found it unnecessary to reach this issue. In Opinion of the Justices to the House of 
Representatives , we filed an amicus brief urging the Justices of the Supreme Judicial Court 
to conclude that a home rule petition authorizing the City of Boston to extend health 
insurance benefits to domestic partners of city employees was not an unconstitutional 
delegation of lawmaking authority and, to the extent the Justices reached the issue, was not 
necessary to allow the City to extend such benefits, because in our view the City could 
already do so under existing law. The Justices agreed that the home rule petition was not an 
invalid delegation and declined to address the second issue. 

The Bureau filed amicus briefs in three Superior Court cases of particular interest to 
municipalities as well as the Commonwealth. In Town of Reading v. Santorelli . we filed a 
brief urging the court to uphold the facial constitutionality of state zoning laws allowing 
cities and towns to regulate the location of adult bookstores and other adult uses. The court 
agreed with our position. In MRI/Wheelabrator v. North East Solid Waste Committee , we 
filed a brief in support of NESWC, a group of twenty-three cities and towns that had 
contracted with MRI for trash disposal, arguing that NESWC could not constitutionally be 
required to use public funds to bear the entire cost of new air pollution control equipment at 
MRI's facility in North Andover. The new equipment would have a useful life of twenty- 
five years, yet the NESWC communities would have a contractual right to use the facility 
for only an additional five years, so that requiring NESWC to pay the full cost would result 
in the unconstitutional use of public funds to confer a primarily private benefit. The court 
has issued a preliminary ruling agreeing with this position. Finally, in Burkhard 
Corporation v. Rojo . we filed an amicus brief in support of defendants' special motion to 



:?^c; 



dismiss pursuant to the anti-SLAPP suit statute. Plaintiffs, proponents of a hotel 
development in Arlington, had sued several town residents for defamation based on 
comments made by the residents in connection with an appeal of a wetlands permit for the 
project. Our brief supported the residents' argument that the defamation action should be 
dismissed as a SLAPP suit; after our brief was filed, the parties settled the action on terms 
favorable to the residents. 

Additional amicus briefs addressing specialized environmental matters are discussed 
below in the Environmental Protection Division section of this report. 

ADMINISTRATIVE LAW DIVISION 

The Administrative Law Division has one primary and three specialized functions. 
Its primary ftinction is the defense of lawsuits against state officials and agencies 
concerning the legality of governmental operafions, particularly those seeking injunctive or 
declaratory relief. Its specialized functions are (1) legal review of all newly enacted town 
by-laws; (2) preparation of legal opinions for constitutional officers, heads of agencies, and 
certain other officials concerning issues arising from the performance of their official 
duties; and (3) review of proposed statewide initiative and referendum questions under 
amendment article 48 of the Massachusetts Constitution. During fiscal year 1998, 
significant events occurred in each of these areas. The Division opened 1259 and closed 
1201 cases during the fiscal year. 

I. Defensive Litigation 

During fiscal year 1 998, cases handled by Division attorneys resulted in 25 reported 
decisions of the Supreme Judicial Court, 1 1 reported decisions of the Massachusetts 
Appeals Court, 5 reported decisions of the United States Court of Appeals for the First 
Circuit, 1 reported decision of the United States Bankruptcy Appellate Panel of the First 
Circuit, 5 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 state trial courts that resulted in unpublished decisions. 

The Division handled many cases in fiscal year 1998 involving children and 
families, most of which resulted in unpublished decisions affirming the termination of 
parental rights over children in the custody of the Department of Social Services. In 
Adoption of Warren , the Appeals Court held that the Interstate Compact on the Placement 
of Children applied to the potential placement of a child with a noncustodial father in 
another state and affirmed the termination of the father's parental rights based, in part, on a 
home study conducted by the New York Department of Social Services. In Care and 
Protection of Bruce , the Appeals Court reversed the judgment terminating the mother's 
parental rights, finding a lack of clear and convincing evidence that the mother, who 
suffered from mental illness, was currently unfit to provide minimally adequate care for her 
child. 

During the past year, several major prisoners rights cases were successftilly 
defended by Division attorneys in state and federal court. In Torres v. Commissioner of 



236 



Correction , the Supreme Judicial Court affirmed summary judgment in favor of the 
defendants and held that: (1) a prison department disciplinary unit (DDU) is not an 
"isolation unit" and is therefore exempt from the fifteen-day maximum limit, and (2) DDU 
confinement does not violate the due process or cruel and unusual punishment provisions of 
the state or federal constitutions. In Inmates of Suffolk County Jail v. Rouse , the United 
States Court of Appeals for the First Circuit upheld the constitutionality of the federal 
Prison Litigation Reform Act (PLRA) and held that the Act required the termination of a 
1979 consent decree governing conditions of confinement at the Suffolk County Jail. In 
King v. Greenblatt . the United States Court of Appeals for the First Circuit held that the 
enactment of a state statute that shifted jurisdiction over the Treatment Center for Sexually 
Dangerous Persons from the Department of Mental Health to the Department of Correction 
was insufficient justification, in itself, for modification of a consent decree under which 
DMH was precluded from using solitary confinement for purposes of discipline or 
punishment. On remand, the District Court found that the requisite change in law or fact 
had occurred and that the proposed modification of the consent decree was "suitably 
tailored to that change." Accordingly, the court granted our motion to modify the decree. 
At the close of the fiscal year, plaintiffs' appeal from that modification order was pending 
in the Court of Appeals. 

Various health-related cases were handled by Division attorneys during the year. In 
American Drug Stores. Inc. v. Harvard Pilgrim Health Care. Inc. . the United States District 
Court for the District of Massachusetts held that the Massachusetts Pharmacy Freedom of 
Choice — Any Willing Provider Act is not preempted by the federal Employee Retirement 
Income Security Act (ERISA), because the state statute does not mandate employee benefit 
structures or their adminisfration. In another preemption case, Phillip Morris. Inc. v. 
Harshbarger . the United States Court of Appeals for the First Circuit held that the 
Massachusetts statute requiring tobacco manufacturers to disclose additives and nicotine- 
yield rating of their product is not expressly or impliedly preempted by federal tobacco 
legislation. In Thomas v. Commissioner of the Division of Medical Assistance , the 
Supreme Judicial Court held that state Medicaid regulations did not violate federal law by 
attributing income to the community spouse in calculating the eligibility of the 
institutionalized spouse for Medicaid benefits. In two cases, the Supreme Judicial Court 
upheld disciplinary actions taken against chiropractors by the Board of Registration of 
Chiropractors. In Sears v. Board of Registration of Chiropractors , the Supreme Judicial 
Court affirmed the Board's decision to revoke plaintiffs license for using improper 
techniques and practices; and, in Goldstein v. Board of Registration of Chiropractors , the 
Supreme Judicial Court affirmed the Board's decision to revoke plaintiffs license due to 
gross misconduct, inappropriate sexual comments, and gross negligence in his practice. 

Adminisfrative Law Division attorneys spent considerable time last year defending 
challenges to the Sex Offender Registration and Community Notification Act, two of which 
resulted in reported decisions. In John Doe v. Attorney General , the Supreme Judicial 
Court held that a person automatically included in the Sex Offender Registry based on a 
conviction of indecent assault and battery was entitled to an individualized hearing on 
whether he should be listed on the registry, as the automatic classification as applied to him 
was a violation of procedural due process as guaranteed by both the state and federal 
constitutions. In Roe v. Farwell. the United States District Court for the District of 



Massachusetts similarly indicated that the statute was unconstitutional as applied to the 
plaintiff in that case. 

Electric utility restructuring gave rise to two reported cases this year. In MIT v. 
Department of Public Utilities , the Supreme Judicial Court concluded that the order of the 
Department of Public Utilities authorizing Cambridge Electric Light Company to impose an 
"exit fee" on MIT, following MIT's departure as a fiill-service customer of Cambridge 
Electric Light Company, did not violate state or federal law. However, the court remanded 
the Department's calculation of the fee, including "stranded costs," due to insufficient 
analysis. In Stow Municipal Electric Dept. v. Dept. of Public Utilities , the Supreme 
Judicial Court upheld a decision by the Department to value plaintiffs property based on a 
weighted combination of cost minus depreciation; but, as in the MIT case, the court 
remanded the "stranded costs" determination to the agency for fiirther findings. 

The Supreme Judicial Court decided several election cases this year that were 
defended by Division attorneys. In League of Women Voters of Massachusetts v. Secretary 
of the Commonwealth , the Supreme Judicial Court concluded that the "Term Limits" law 
approved by the state's voters in 1994 is unconstitutional insofar as it limits ballot access of 
certain incumbents and eliminates compensation for certain state officials who are reelected 
as "write-in" candidates. In Dimino v. Secretary of the Commonwealth , the Supreme 
Judicial Court held that the Attorney General erred in certifying a citizen's initiative 
petition to eliminate tolls on certain Massachusetts roads, because the petition contained 
matters excluded fi-om the initiative process under the initiative amendment to the 
Massachusetts Constitution. 

Public Records Act cases also consumed considerable time of Division attorneys 
during the past year. In one such case, Lambert v. Executive Director of the Judicial 
Nominating Committee , the Supreme Judicial Court held that questionnaires completed by 
applicants for judicial appointment and submitted to the Governor through the Judicial 
Nominating Committee do not fall within the Public Records Act because neither the 
Committee nor the Governor is covered by the Act. 

Several environmental cases were litigated by Division attorneys during fiscal year 
1998. In Strahan v. Coxe . a case handled jointly with the Trial Division, the United States 
Court of Appeals for the First Circuit held that Massachusetts' regulation of commercial 
fishing exacted a taking of Northern right whales in violation of the Endangered Species 
Act; at the end of the year, our petition for certiorari to the United States Supreme Court 
was pending. In Geer v. Federal Highway Administration , the United States District Court 
for the District of Massachusetts held that the Federal Highway Administration's approval 
of a bridge crossing the Charles River, as part of the Central Artery Project, complied with 
federal environmental laws. In Baker v. Coxe . the United States District Court for the 
District of Massachusetts held that the Attorney General's office was not disqualified fi-om 
representing the Massachusetts Executive Office of Environmental Affairs (EOEA), simply 
because the EOEA's deput)' general counsel had worked, while a law student, at the law 
firm representing the plaintiffs in related litigation. 

Tax cases decided this year included several cases regarding claims for abatement of 
various excise taxes. In Morton Buildings. Inc. v. Commissioner of Revenue , the Appeals 
Court held that raw materials used in building components, prefabricated outside 



238 



Massachusetts and used in the construction of buildings in Massachusetts, are not subject to 
use tax. In Amgen, Inc. v. Commissioner of Revenue and Kennametal. Inc. v. 
Commissioner of Revenue , the Supreme Judicial Court affirmed two decisions of the 
Appellate Tax Board concluding that the activities of out-of-state corporations were subject 
to excise taxation in Massachusetts because they exceeded the mere solicitation of orders 
which is protected from taxation by a federal statute. The constitutionality of that federal 
statute was upheld in National Private Truck Council. Inc. v. Commissioner of Revenue , in 
which the Supreme Judicial Court further held that the federal statute preempted state law 
governing taxation of foreign corporations. In The New York Times Co. v. Commissioner 
of Revenue , the Supreme Judicial upheld the Commissioner's authority to impose excise 
taxes on aircraft that were hangared and largely maintained within the Commonwealth and 
that were used for business within and without the Commonwealth. Additionally, the court 
held that the Commissioner had no obligation to publicly announce his intent to assess taxes 
on such aircraft before doing so. In Leger v. Commissioner of Revenue , the Appeals Court 
held that, by temporarily excluding reupholstery services from sales tax, the Commissioner 
was not estopped from collecting the tax, because the regulation excluding such services 
from taxation was in effect for only a brief period after the tax period in question. Division 
attorneys also handled several cases regarding the methods for calculating various excise 
taxes, including Lily Transportation Corp. v. Board of Assessors of Medford . in which the 
Supreme Judicial Court held that calculating motor vehicle excise taxes based on list price, 
rather than sales price, is not a violation of due process; and Gillette Company v. 
Commissioner of Revenue , in which the Supreme Judicial Court held that the Appellate 
Tax Board had no statutory authority to use a "unitary method" of net income determination 
and apportionment and therefore correctly denied the taxpayer's application for an 
abatement of corporate excise taxes, premised on such a method. 

The Supreme Judicial Court decided several insurance cases this year that were 
defended by Division attorneys. In Massachusetts Association of Insurance Agents v. 
Commissioner of Insurance , the Supreme Judicial Court concluded that the Commissioner 
of Insurance, after determining that the market was not conducive to competition, properly 
used a net basis methodology to determine agents' commission rates in 1 997, even though a 
different methodology was used to determine 1996 commission rates. In Bankers Life & 
Casualty Co. v. Commissioner of Insurance , the Supreme Judicial Court affirmed the 
Commissioner's disapproval of an insurer's proposed rate increases for two Medicare 
supplemental insurance plans, because the insurer failed to meet its evidentiary burden. In 
Ginther v. Commissioner of Insurance , the Supreme Judicial Court affirmed the lower 
court's dismissal, based on plaintiffs lack of standing, of a challenge to the 
Commissioner's decision to approve the acquisition of two Massachusetts insurance 
companies by a Delaware corporation. 

Several cases were decided this year arising from employment actions affecting civil 
service employees. In Kelly v. Civil Service Commission , the Supreme Judicial Court held 
that, even if evidence obtained as a result of police officers' stop of a firefighter had 
properly been suppressed in criminal proceedings, that evidence could still be considered by 
the Civil Service Commission in its decision upholding the discharge of the firefighter. In 
City of Cambridge v. Civil Service Commission , the Appeals Court held that the Civil 
Service Commission applied an overly intrusive standard in reviewing an appointing 
authority's "bypass" of a candidate for appointment as a police officer. In Herlihy v. Civil 



:>^q 



Service Commission , the Appeals Court held that, for purposes of "bumping" rights, a 
"department unit" is broader than one particular mental health center. 

Other employment cases decided this year included Boston Police Superior Officers 
Federation v. City of Boston , in which the United States Court of Appeals for the First 
Circuit held that the promotion of an African- American police officer served the compelling 
state interest of remedying the effects of past racial discrimination, and that the promotion 
was narrowly tailored to meet that goal, thus meeting the "strict scrutiny" test applied in 
race-based affirmative action cases; Lavelle v. Massachusetts Commission Against 
Discrimination , in which the Supreme Judicial Court held that respondents in 
discrimination cases in which damages are awarded by the MCAD are entitled to a jury 
trial, but only after the Commission has taken its final action; and School Committee of 
Westport V. Coelho . in which the Appeals Court held that teachers who are terminated from 
employment due to budgetary reasons are not entitled to arbitration under the Education 
Reform Act of 1993. In two successive cases, both entitled Alliance. AFSCME/SEIU. 
AFL-CIO V. Commonwealth , the Supreme Judicial Court dismissed, on procedural 
grounds, cases challenging the Governor's power to veto a provision in a budget line item 
requiring continued funding of certain state employee positions. 

Several cases litigated during fiscal year 1 998 concerned eligibility for and 
calculation of retirement benefits. In Sugrue v. Contributory Retirement Appeal Board , the 
Appeals Court affirmed a Superior Court decision that a retired police officer was not 
entitled to accidental disability retirement benefits, because his psychiatric condition was 
not the natural and proximate result of "personal injury" he had sustained by reason of 
exposure to an uncommon and identifiable condition while in the performance of his duties. 
In Barnstable County Retirement Board v. Contributory Retirement Appeal Board , the 
Appeals Court affirmed CRAB's decision that reftmded administrative fees and interest 
should not be included in calculating a local retirement board's return on its investments. 

Actions involving motor vehicle registrations and drivers licenses were the subject 
of three reported cases during the past fiscal year: Dowling v. Registrar of Motor Vehicles , 
in which the Supreme Judicial Court held that the Registrar of Motor Vehicles had properly 
suspended the plaintiffs Massachusetts driver's license after being notified that his license 
had been suspended for one year in New Hampshire for driving under the influence; 
Bombardieri v. Registrar of Motor Vehicles , in which the Supreme Judicial Court upheld 
the validity of a program under which automobile dealers may communicate electronically 
with the Registrar for new vehicle registrations and title transactions; and In re Appugliese . 
in which the United States Bankruptcy Court concluded that fees for drivers' licenses and 
motor vehicle regisfrations are excise taxes, not property taxes, and therefore are 
nondischargeable in bankruptcy proceedings. 

A number of other significant cases handled by the Division were decided this year. 
In Canterbury Liquors & Pantry v. Sullivan , the United States District Court for the District 
of Massachusetts held that state regulations concerning wholesale liquor prices violated 
federal antitrust laws and denied a stay of that decision pending the wholesalers' appeal. In 
In re Summerfield Pine Manor , the United States Bankruptcy Appellate Panel of the First 
Circuit held that the Bankruptcy Court properly declined to abstain from deciding "core" 
bankruptcy motions in a nursing home bankruptcy case. In First Fiduciary Corp. v. Office 
of the Commissioner of Banks , the Appeals Court held that a corporation whose activities 



240 



are limited to corporate trusteeship and do not involve deposits, loans, or other areas of 
banking business is not a "bank" subject to oversight by the Commissioner of Banks. 

II. Municipal Law 

The Attorney General's Office is required by statute to review and approve or 
disapprove town-by-laws and amendments to municipal 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 Administrative Law Division of the 
Government Bureau, with the assistance, as necessary, of attorneys from every other bureau 
in the Attorney General's Office. 

During fiscal year 1 998, the Municipal Law Unit reviewed: 795 general by-laws, of 
which 701 were approved (88%), 37 were disapproved (4.7%), 27 were approved with 
partial deletion of text (3.4%), and 20 were returned with a ruling that no Attorney General 
action was required; 1014 zoning by-laws, of which 921 were approved (91%), 41 were 
disapproved (4%), 23 were approved with partial deletion of text (2.3%), and 1 was 
returned with a ruling that no Attorney General action was required; 28 charter matters, of 
which 25 were approved and 3 were returned with a ruling that no Attorney General action 
was required; and 4 historic district by-laws, all of which were approved. 

During this fiscal year the administration of the Unit moved to the Attorney 
General's Western Massachusetts Office in Springfield. This year, the Unit has achieved 
major improvements in speed, efficiency, and accuracy through revised file handling 
procedures and computerized file tracking. By early procedural review of all materials 
submitted to us for approval, the Unit has been able to identify and correct procedural 
deficiencies early enough to permit correction without having to extend the ninety-day 
period prescribed by law. Under new Unit procedures, most reviews are completed in 
under sixty days from the date of receipt. 

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 uses of land for 
the common good. During fiscal year 1998 the most common subjects of local zoning by- 
law amendments were adult entertainment, wireless cell tower construction, rate of 
development and phased growth, and assisted living facilities. 

General by-laws pertain to town governance and the exercise of municipal power. 
The principal subjects of general by-law amendments during the past year included animal 
control, wetlands protection, street opening, and capital planning. 

In addition to reviewing by-laws and charter amendments, the Municipal Law Unit 
responds to numerous telephone calls (from 1 to 40 daily) and information requests from 
town officials and residents, legislators, reporters, and state agencies. During the past year, 
attorneys from the Municipal Law Unit spoke at numerous meetings of associations of town 
clerks, town counsel, and town planning and zoning boards, including conducting several 
workshops for town clerks concerning the Attorney General's by-law review criteria and 



241 



procedures. Unit attorneys also assist other divisions and bureaus of the Attorney General's 
office in connection with municipal law aspects of issues being handled by them. 

III, 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 fi-om 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 1 998, the Attorney General did not issue any formal Opinions. 
During that time period, the Attorney General issued 41 letters providing informal advice or 
declining to give advice. The Attorney General also responded to numerous oral requests 
for advice from state agencies and officials, often on short notice due to exigent 
circumstances. 

IV. Ballot Question Review 

The Administrative Law Division ftilfiUs the Attorney General's duty, under 
amendment article 48 of the Massachusetts Constitution, to review proposed statewide 
initiative and referendum questions to determine whether they may appear on the ballot. 
The Attorney General must certify an initiative measure if (1) the measure and its title are 
in proper form; (2) the measure is not substantially the same as any measure which has been 
qualified for submission or submitted to the people at either of the two preceding biennial 
state elections; and (3) the measure contains only subjects that are related or mutually 
dependent and that are not excluded from the initiative. The "excluded matters" 
requirement usually presents the most difficult issues. Many important and controversial 
subjects are off-limits to initiative petitions, such as those dealing with courts and judges; 
state appropriations; religion; specific cities, towns, or areas of the Commonwealth; or 
measures inconsistent with certain fiandamental constitutional rights. Petitions touching on 
these matters cannot be certified. 



242 



If the Attorney General decides to certify the measure as conforming with these 
requirements, the Attorney General also prepares a fair and concise summary of the 
measure; this summary appears on blanks for subsequent signers and, if the measure 
eventually appears on the ballot, the summary appears in the guide for voters prepared by 
the Secretary and appears on the ballot as well. 

The Attorney General's fimction with respect to referendum petitions is similar. He 
is asked by the Secretary of State to determine if the law that the petitioners wish to repeal 
deals with any "excluded matters," and, if it does not, he prepares a summary of the law for 
use on petition blanks and, if the petition obtains enough signatures, for use in the guide for 
voters and on the ballot. 

In FY 1998, the Attorney General reviewed 26 initiative petitions, on subjects 
including term limits for elected officials; campaign finance reform; road, bridge and tunnel 
tolls; tax cuts; evictions of tenants without just cause; and parental rights. Of these, 24 were 
certified and 2 were found to contain excluded matters and thus not certified. The Attorney 
General reviewed one referendum petition, seeking to repeal the Commonwealth's new 
electric industry restructuring law, St. 1997, c. 164, and he advised the Secretary that the 
law was not excluded fi^om the referendum process. 

THE TRIAL DIVISION 

The Trial Division handles civil cases brought against the Commonwealth and its 
officers and employees in real estate, civil rights, employment, torts, contracts and other 
miscellaneous areas. In almost all of these cases the plaintiffs are seeking money damages. 
In some they also seek injunctive or declaratory relief The Division's AAGs carry heavy 
caseloads, and the work of the Division is determined almost entirely by how many cases 
plaintiffs file; 444 new cases were assigned to the Division in FY 1998, and 276 cases were 
closed. Most of the Division's cases that are not dismissed by the courts are settled, as most 
civil cases are nationwide. The Division's goals are to present strong and effective defenses 
to these lawsuits consistent with ensuring fair and just results for the complaining parties 
and the Commonwealth. 

In FY 1998, the Trial Division carried forward the innovations and initiatives begun 
in FY 1997 and earlier. The Division emphasizes early evaluation of cases for settlement, 
disposition by motion, or more protracted litigation. In particular, the Division placed 
increased emphasis on efficient case management and altemative dispute resolution (ADR). 
The Division's lawyers continue to work with the office- wide ADR Coordinator and in FY 
1998 mediated many cases to successful conclusions. 

Division attorneys continued to participate in practice groups through FY 1998; 
such groups have proven effective as a professional development vehicle for AAGs at all 
levels of experience. Other training initiatives undertaken include the development and full 
implementation of a formal Trial Division orientation program. The eminent domain 
second chair program continued, with Trial Division AAGs participating in trials of 
eminent domain cases being handled by outside counsel. These and other professional 
development ideas, including the established mentoring and supervision model, and 



243 



requiring two AAGs in all Division trials, reflect the Division's tradition of and 
commitment to continuing legal education for its staff. 

The Division also continued to contribute to the Attorney General's major priorities, 
including in particular efforts to make government function more effectively and efficiently 
based on lessons learned through litigation. For example. Division lawyers have been 
active in helping to formulate a recommended state-wide policy regarding high-speed police 
chases; in advising and training state agencies on risk management and tort liability 
reduction techniques; and in increasing financial protection for the Commonwealth through 
improving indemnification clauses in Commonwealth contracts. Division lawyers were 
also instrumental in conceiving and presenting the Attorney General's internal trainings on 
legal ethics and professional responsibility. 

I. Real Estate Cases 

In the area of eminent domain and other real estate, the Division opened 137 cases 
during FY 1998. The disposition of land damage cases resulted in a savings of more than 
$40 million to the Commonwealth, which represents the difference between the amounts 
claimed and the amounts paid. 

The Trial Division handles many different kinds of real estate cases. The ones with 
the largest potential exposure to the Commonwealth and the most complexity are often in 
the area of eminent domain, where landowners are entitled to jury trials in cases where they 
are not satisfied with the award the Commonwealth has made to them in the condemnation 
(land taking) process. In the last few years, many cases have been generated by the 
Massachusetts Highway Department's Central Artery /Ted Williams Tunnel (CA/T) project, 
the largest single public works project in the United States, in which downtown Boston's 
entire traffic pattern is undergoing change. The following are some of the significant 
Central Artery cases and others the Trial Division handled in the real estate area in FY 
1998. 

Spaulding Rehabilitation Hospital v. Commonwealth . Suffolk Superior. After a 
lengthy bench trial, the court rejected a claim by Spaulding Rehabilitation Hospital that the 
CA/T Project was contractually obligated to take the hospital by eminent domain and pay 
for its relocation. The Hospital had sought up to $100 million. The case is now on appeal. 

Boston Wharf Co. v. Commonwealth . Suffolk Superior. In this CA/T case 
involving property in the South Boston redevelopment area, the plaintiff claimed damages 
of $28,000,000. The Commonwealth's figure was $14,000,000. The parties negotiated the 
case to a successfiil settlement of $16,500,000 in "new money," which is the amount of the 
total settlement or verdict less the "pro tanto" amount paid on the initial taking, plus interest 
on the final amount. 

Chardon Realty v. Commonwealth . Suffolk Superior. The plaintiffs, landlord and 
tenants, sought to enjoin the CA/T Project fi^om dismantling the loading dock in front of 
their industrial building on Beverly Street at North Station. They alleged they were 
displaced persons who would be forced to move and that they were entitled to relocation 



244 



assistance under G.L. c. 79A. The court denied their request for injunctive relief, and the 
plaintiffs voluntarily dismissed their complaint. 

Bird Island Limited Partnership v. Commonwealth and related cases. In these cases 
involving substantial CA/T takings at the airport, including land taken from the 
Massachusetts Port Authority, a global settlement was reached among the various parties. 

Independence Park. Inc. v. Commonwealth , Barnstable Superior. In this taking by 
the Department of Fisheries, Wildlife and Environmental Law Enforcement, the plaintiffs 
expert testified to a high valuation of $3 1 ,500,000. The Commonwealth presented two 
appraisals in the amounts of $5,185,000 and $7,400,000. The case settled during trial for 
$6,200,000 in "new money." 

Bradshaw v. Commonwealth , Plymouth Superior. The Metropolitan District 
Commission took several acres in the Plymouth area, some of which was zoned industrial, 
some commercial, and some of which could be used as a gravel operation. Plaintiffs 
expert's valuation was $6,390,000. The Commonwealth's expert's appraisal was 
$3,020,000. The parties mediated the case to a settlement amount of $4.4 million in "'new 
money." 

Bacon v. Commonwealth . Salem Superior. In these consolidated cases involving 
takings in Saugus, after a seven-day trial, the jury rendered a verdict of $1,000,000. The 
plaintiffs expert had testified to damages of $1,650,000 and the Commonwealth's experts 
had testified to $600,000 and $500,000. The verdict was a success for the Commonwealth 
because it was below the "split," Le^, the point halfway between the opposing experts' 
appraisals. 

Anderson v. Commonwealth . Barnstable Superior. A 20-acre parcel of land in 
North Falmouth was taken by the Departm.ent of Fisheries, Wildlife and Environmental 
Law Enforcement for its appraised value of $105,000. The plaintiffs appraiser valued the 
land at $180,000. After a two-day trial, the jury reached a verdict of $137,500. 

DiTommasso v. Commonwealth , Middlesex Superior. A 20-square-foot parcel of 
land along Route 20 in Marlboro was taken by the Massachusetts Highway Department for 
its pro tanto appraised value of $2,000. The plaintiffs appraiser valued the land at $5,550 
and an additional $84,170 for severance damages. After a four-day trial, the jury awarded 
the plaintiff $5, 112. 

Santella v. Commonwealth , Middlesex Superior. An 8-foot strip of land along 
Route 20 in Marlboro was taken by the Highway Department, which appraised the property 
taken at $3,300 (pro tanto), while plaintiffs appraiser valued the taking at $35,000. After a 
three-day trial, the jury awarded the plaintiff $4,200. 

Anthony v. Metropolitan District Commission . Worcester Superior. The MDC 
settled this case involving the taking of more than 100 acres of real property in West 
Boylston for watershed protection purposes. The MDC agreed to pay $600,000 to the 
plaintiffs. The pro tanto award was approximately $225,000. The MDC settled after the 
court denied its request that the plaintiffs' expert be precluded from giving valuations for 



245 



the property at trial based on a proposed 14-lot subdivision plan and a proposed 63-lot 
subdivision plan. 

Conlon V. Commonwealth . Suffolk Superior. This trial concerned land taken in 
Hyde Park for open space conservation. After four days, the jury returned a verdict 
awarding plaintiffs $1 15,000. The plaintiffs' experts had valued the property at $225,000, 
claiming the vacant land could have been developed for five house lots. The 
Commonwealth's experts had said the land was best used for a single "estate lot" worth 
$40,000 because of associated development costs. 

Rexhame Terrace Land Trust v. Commonwealth . Land Court. Plaintiffs used a 
G.L. c. 240, §§ 1-5, "try title" action against the defendants in an attempt to obtain a court 
ruling that the plaintiffs owned Old Rexhame Beach in fee, free of any easements. The 
Trial Division intervened as representative of the public and moved to dismiss the action. 
The Commonwealth presented evidence of an 1832 case, Thomas v. Inhabitants of 
Marshfield . involving the same beach and the predecessors in interest of the current parties. 
The court dismissed the action, without prejudice, finding that the Thomas case described 
the beach at issue as public land. 

Paul's Lobster. Inc. v. Commonwealth . Suffolk Superior. The plaintiff sought 
damages fi-om both the Commonwealth and the city of Boston for a constructive taking of 
its property and/or special and peculiar injuries, allegedly caused by the reconfiguration of 
Northern Avenue. The plaintiff also sought $2.6 million in relocation reimbursement, 
alleging that the reconstruction devastated its business and forced it to move. The court 
dismissed the relocation claim for failure to exhaust administrative remedies and dismissed 
the remainder of the claims against the Commonwealth on cross-motions for summary 
judgment. 

Zora Enterprises v. Commonwealth . Plymouth Superior. The plaintiff claimed that 
his land was "taken" because of delay in issuing superseding orders of condition by the 
Department of Environmental Protection in a wetlands proceeding. The court allowed the 
Commonwealth's motion for summary judgment, as plaintiff did not have a final decision 
from the agency, plaintiff acquired the property after the statute was passed which restricted 
the use of wetlands, and the property as a whole retained substantial economic value. 

Shields v. Commonwealth . Worcester Superior. The jury returned a verdict of 
$225,000 in this case involving a taking by the Metropolitan District Commission of 88.1 
acres in Oakham and Rutland. The plaintiffs expert had appraised the property at $560,000 
with an additional value of several hundred thousand dollars for gravel. The 
Commonwealth's expert had appraised the property at $180,000. 

II. Civil Rights Cases 

Civil rights cases, defended in both the Trial Division and Administrative Law 
Division, present myriad legal problems and can subject the Commonwealth to significant 
financial liability. Civil rights damage awards are not limited by statute, and successfiil 
litigants may recover interest, costs and attorneys fees. The Trial Division opened 19 new 



246 



civil rights cases and resolved a number of such cases in FY 1998. The following are 
representative. 

Christopher v. Department of Mental Health . U.S.D.C. The plaintiff brought federal 
and state civil rights claims against the Department and employees in their official and 
individual capacities after the plaintiff was placed on leave without pay pending the 
resolution of certain criminal charges. The court allowed the Division's motion to dismiss. 

Samanian v. Department of Revenue . U.S.D.C. Plaintiff filed this civil rights action 
against Department of Revenue and Department of Correction employees in their official 
and individual capacities as a result of DOC having disbursed money from plaintiffs 
inmate account to DOR, in accordance with a notice of levy issued by DOR, as payment on 
plaintiffs outstanding child support obligations. The Commonwealth's motion to dismiss 
was allowed. 

Mui v. Salem State College . Essex Superior. The plaintiff, a college student, was 
found guilty of academic plagiarism. A mandatory one-semester suspension was imposed. 
The plaintiff then sued the College, alleging various due process and contract claims. When 
the college notified him that, under the published academic procedures, he could not 
graduate until his claim was resolved, he sought an injunction less than one week before 
graduation day ordering the College to graduate him. The court denied the injunction, 
agreeing that plaintiff had little chance of success on the merits and adding that he was not 
entitled to equity, having waited imtil the last moment to seek relief The court also denied 
the plaintiffs belated request to raise G.L. c. 93A and intentional interference with contract 
claims. 

Judge V. City of Lowell . U.S.D.C. The plaintiff asserted civil rights claims against 
the state Medical Examiner, claiming that the investigation of her brother's death, including 
the search for next of kin. was handled differently because of her race. The Division argued 
that the plaintiff did not put forth any facts upon which it could be concluded that any 
mistakes allegedly made in the investigation were due to racial discrimination. The 
Division's motion to dismiss was allowed. 

Polls v. Weld . First Circuit. The court affirmed the lower court's dismissal of 
plaintiffs state civil rights claims based on the Department of Mental Retardation's 
termination of contracts with his company. The court also agreed that plaintiff could not 
bring a claim for breach of contract. 

III. Employment Cases 

In the employment area, the Division opened 30 cases during FY 1998. The 
following are representative of the cases the Division handled during the year. 

In LoRusso v. Commonwealth , the plaintiff alleged that the Department of Revenue 
had discriminated against him on the basis of his handicap, a psychological condition. He 
claimed damages in the hundreds of thousands of dollars for not having been promoted, for 
mental distress and for attorneys' fees. After a six-day trial in Suffolk Superior Court, the 
jury returned a verdict for the Commonwealth. 



247 



Lucas V. Executive Office of Environmental Affairs . Suffolk Superior. The 
plaintiff, an environmental police officer with the Department of Fisheries and Wildlife and 
Environmental Law Enforcement, brought an action against several defendants for sex 
discrimination, sexual harassment, unlawful retaliation, civil rights violations and breach of 
contract. She also contended that she was deprived of her right as a tenured employee to a 
lateral transfer. The Commonwealth's motion for summary judgment was allowed as to all 
except the contract and right-to-transfer claims. 

McCarthy v. Office of State Auditor . Suffolk Superior. In this sexual harassment 
case, the plaintiff claimed that the defendants had created a hostile work environment and 
had engaged in retaliation. After extensive discovery and mediation, the Commonwealth 
settled the matter. 

Gharooni v. Roxbury Community College . Middlesex Superior. In this case the 
plaintiff claimed employment discrimination on the basis of race and national origin, as 
well as breach of contract. The parties settled the matter before trial. 

Sinai v. Department of Social Services . Suffolk Superior. Plaintiff claimed he was 
denied a job interview with DSS because of his ethnic origin and his age. The court granted 
the Commonwealth's motion for summary judgment dismissing the case. 

Local 509. SEIU v. Department of Mental Retardation . Suffolk Superior. In this 
case, filed by the union of behalf of certain DMR employees who claimed to have been 
affected by a privatization initiative, the union voluntarily dismissed the case after 
discovery, apparently convinced that there was not a triable case that any damage had 
occurred. 

Alston V. Department of Education . Suffolk Superior. An Aftican-American woman 
alleged racial discrimination and retaliation by DOE, after a department-wide 
reorganization in which she had lost her job to a white woman who was also the union 
steward. She also sued the union. DOE filed a motion for summary judgment, which the 
court granted. 

IV. Torts Cases 

In the torts area, the Division opened 1 74 new cases in FY 1998. The following are 
representative of the cases the Division handled during the year. 

Bingham v. Division of Registration . Bristol Superior. The plaintiff, a social 
worker, alleged a wide range of tortious conduct by the Division and individual employees 
based upon her distress in going through a disciplinary procedure on a complaint of having 
an improper relationship with a former client. The court held that absolute prosecutorial 
immunity barred the plaintiffs suit against the Division of Registration, the Chairman of 
the Board of Registration of Social Workers, the prosecuting counsel, and the 
administrative counsel. 

Keough V. Commonwealth . Suffolk Superior. The plaintiff sued both the 
Commonwealth and a newspaper publisher for serious injuries she sustained when her feet 



248 



became entangled in a plastic newspaper binding at a state-owned commuter parking lot. 
The plaintiff demanded $38,000 at the pretrial conference. The case settled a short time 
later for $9,000, to which the Commonwealth contributed $2,500. 

Lemiex v. Commonwealth . Suffolk Superior. The plaintiff, a correctional officer, 
suffered serious injury when he slipped on buckled flooring in a refrigeration unit at the 
Suffolk County House of Correction. It was the contention of the plaintiff, as well as the 
codefendants (a general contractor and two subcontractors), that the defective flooring was 
installed because a state agency had refiised to follow the general contractor's advice to 
install stronger (but more expensive) flooring. At mediation, plaintiff initially demanded 
$1 80,000. The case settled for $25,400, with the Commonwealth and each of the three 
codefendants contributing $6,350. 

Violette v. Commonwealth . Middlesex Superior. The plaintiff alleged that she fell 
and injured herself on defective pavement on a state highway. The court allowed the 
Commonwealth's motion for summary judgment on grounds that the alleged condition 
failed to constitute an actionable defect for purposes of G.L. c. 81, § 18. 

Hoeg v. Commonwealth . Suffolk Superior. The plaintiff, a Bridgewater State 
College student, alleged that the college negligently maintained stairs on a foot bridge by 
failing to repair a missing nose guard. He sought compensation for a knee injury allegedly 
incurred after he slipped while walking down stairs from the footbridge. The plaintiff also 
alleged that the college should have warned pedestrians of the defect, pending repair. After 
a one-day trial, the jury returned a verdict for the college. 

MaCalister v. Commonwealth . Middlesex Superior. The plaintiff alleged that she 
slipped and fell on an unnatural accumulation of snow and ice at the University of 
Massachusetts at Lowell. She testified that at the time of the accident she was looking 
elsewhere. After a three-day trial, the jury returned a verdict for the Commonwealth. 

Gilmore v. Commonwealth . Norfolk Superior. The plaintiff claimed negligent 
infliction of emotional distress after an incident in which his sister's former boyfriend 
kidnapped and murdered her. Plaintiff alleged that a psychiatrist at Bridgewater State 
Hospital was negligent in not recommending that the perpetrator be committed when he 
was seen there months earlier. After a two-week trial, the jury deliberated for three hours 
before returning a verdict finding that neither Middlesex County nor the employees of 
Bridgewater State Hospital acted negligently. 

McNemar v. Commonwealth . Suffolk Superior. In this wrongful death action, the 
plaintiff asserted that employees of the Department of Mental Health were negligent in not 
monitoring the decedent more closely. Civil rights claims against 15 named employees 
were also tried. The civil rights claims were dismissed at the end of the plaintiffs case. 
After a four-week trial, the jury found no liability on the part of the Department of Mental 
Health. The Department of Public Health was found liable. Damages were assessed at 
$2.25 million, but reduced to $100,000 as required by state law. 

Belanger v. Commonwealth , Suffolk Superior. The plaintiff, an employee of a 
contract vendor with the Department of Mental Health, slipped and fell on ice at a half-way 



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house operated and maintained by the vendor which employed her. The Division's motion 
for summary judgment, based on the lack of any duty on the Department of Mental Health 
to maintain or clear ice and snow at the site of the injury, was granted. 

V. Contracts Cases 

In the contracts area, the Division opened 35 new cases and continued to defend 
other pending cases involving state contracts. The contracts involved include construction 
contracts for projects ranging in value from many millions to several hundreds of thousands 
of dollars; leases entered into by state agencies; and contracts for the purchase of goods and 
services. The following are representative of the Division's contract cases this year. 

New England Independent Truckers Association v. International Brotherhood of 
Teamsters Local No. 379 . U.S.D.C. The plaintiffs are a group of truckers on the Central 
Artery /Tunnel Project who sought to prevent several general contractors, the Teamsters 
Union, and the Massachusetts Highway Department from withholding contributions from 
the truckers' pay to the Teamsters' health and pension fringe benefit fiind. The court stayed 
the plaintiffs' request for a preliminary injunction pending a decision by the First Circuit on 
a similar issue in a case involving a Massachusetts Water Resources Authority project. The 
court also deferred ruling on the Division's motion to dismiss. 

Inacom Corp. v. Commonwealth . U.S.D.C. This debarment dispute arose out of the 
Attorney General's Fair Labor and Business Practices Division's enforcement of G.L. c. 
152, § 25C(10). The court denied the plaintiffs request for injunctive relief and allowed 
the Division's motion to dismiss. 

TLT Construction Corp. v. Abatement Specialists. Inc. v. Division of Capital 
Planning and Operations . Suffolk Superior. After a two-day bench trial, the court found 
that a subcontractor for an asbestos abatement renovation project on the Esplanade's Hatch 
Shell was not entitled to recover any additional money for its work. The court also ruled 
that the subcontractor's contract had been properly terminated. 

Champigny v. North Shore Community College . Appeals Court. After plaintiffs 
recovered $388,450 pursuant to a resolve passed by the Legislature, plaintiffs sought 
prejudgment interest on that amount pursuant to G.L. c. 231, § 6F. The court affirmed the 
Superior Court decision denying plaintiffs' claim. 

VI. Miscellaneous Matters 

The Division handles many cases and other matters that do not fit neatly into the 
above categories. The Division opened 23 such cases in FY 1998, and the following are 
representative. 

Whelan v. Division of Medical Assistance . Appeals Court. The court affirmed a 
Superior Court decision approving the Division of Medical Assistance's enforcement of its 
Medicaid lien against the plaintiffs settlement proceeds from a medical malpractice action. 



250 



Maloney v. Vezina , Plymouth Superior. The court granted summary judgment for 
the defendant state Adjutant General. The judge agreed that the plaintiff, the former 
commander of the Massachusetts National Guard, lacked standing to bring an action for 
declaratory relief 

154-218 Adams Street Realty Trust v. Department of Housing and Community 
Development . Northeast Housing Court. The court allowed the Division's motion for a 
■ directed verdict after five days of trial in two actions brought by the plaintiff property owner 
and ten intervening former tenants against the Department, its contract agency, and 
individual defendants for breach of contract and intentional interference with contract, in 
connection with the termination of HUD-sponsored Section 8 moderate rehabilitation rental 
assistance subsidies in the city of Lowell. 

Lexington Firefighters' Union v. Town of Lexington . This potential affirmative 
case on behalf of the Commonwealth's Joint Labor Management Committee, to compel the 
Town of Lexington's executive branch to comply with its statutory duty to support Town 
Meeting ftmding of a JLMC arbitration award, was settled after the Attorney General's 
office sent a demand letter to Town officials informing them that they had breached their 
statutory duty by unreasonably delaying the Town's consideration of the award and by not 
providing Town Meeting members wdth proper information about the award. 

DeMarco v. Department of Correction . Essex Superior. In this medical malpractice 
case brought by a former prison inmate against of the Health Services Division of the 
Department of Correction and a state employee at the Lemuel Shattuck Hospital, the court 
allowed the Division's motion to dismiss based upon plaintiffs violation of discovery 
orders and failure to prosecute. 

Armansa v. Lemuel Shattuck Hospital . Suffolk Superior. In this medical 
malpractice case brought against the Hospital and an individually named physician, the 
court allowed the Division's mofion dismissing all defendants on the grounds of inadequate 
presentment and employee immimity. 

Thompson v. Executive Office of Communities and Development . Boston Housing 
Court. The Division settled for $6,000 this lead paint case in which EOCD was 
administrator of the state housing voucher program and the minor plaintiff sustained lead 
poisoning in a unit paid for with a voucher. 

The Division assisted in updating and adding a research tips appendix to the Coastal 
Zone Management manual "Researching Historic Rights of Way to the Sea," which the 
Division had contributed to and edited in 1996. The book is used in conjunction with 
workshops given to pro bono attorneys and mediators as part of the state's new Coastal 
Access Legal and Mediation Services committee. 

THE ENVIRONMENTAL PROTECTION DIVISION 

The Environmental Protection Division (EPD) serves as litigafion 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 



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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. EPD also plays a key role under the Clean State Initiative to 
ensure that the Commonwealth's own agencies abide by state and federal environmental 
agencies, and in doing so the Division may bring enforcement actions against those 
agencies in court where the Attorney General, in his enforcement discretion, deems action 
necessary. 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 1998, EPD handled enforcement proceedings leading to 
judgments requiring future payments to the Commonwealth of $3,880,363. These are 
figures for penalties and cost recovery awarded in fiscal 1998, whether or not actually paid 
in fiscal 1998. Actual payments received by EPD, in fiscal year 1998, were $1,759,922 for 
civil penalties and $1,900,513 for hazardous material cost recovery, for a total of 
$3,660,435. Other cases resulted in court judgments requiring private parties to undertake 
costly cleanups— a savings of millions of dollars to the Commonwealth. In fiscal 1998, the 
Division opened 70 new cases and closed 86 cases. 

I. State Enforcement and Cost Recovery Litigation 

One of the most important functions of EPD is to bring litigation to enforce state 
and federal 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. 
Bay State/Sterling. Inc . The defendant, which manufactures abrasive grinding wheels, was 
operating without air permits from DEP and emitting in excess of 50 tons of volatile 
organic compounds per year into the air. It also disposed of hazardous waste off-site 
improperly. In a judicially-approved settlement, the company agreed to pay $850,000 in 
civil penalties to settle its liability for air, hazardous waste, toxic use reduction, and 
wastewater violations at its Westborough plant. Because the defendant company changed 
hands, new management moved quickly to correct the violations and pay $250,000 of the 
penalty. Another $600,000 came from a contingency escrow that would have otherwise 
have gone to the previous owners. The defendant also agreed to a mitigation package, 
which includes an environmental audit and reducing or eliminating use of 1 1 toxic 
chemicals. 

We settled a case involving alleged violations of air pollution laws at a 
manufacturing facility in Worcester. As part of the settlement in Commonwealth v. Norton 
Company , the defendant and a related company agreed to pay $1 10,000 in penalties. The 
defendants also agreed to take steps to reduce emissions of odors and particulates from the 
facility and to conduct an environmental audit of their operations. Norton Company 



252 



manufactures abrasive and grinding wheels and Saint Gobain Industrial Ceramics, Inc., 
produces heat-resistant ceramics at the facility. 

In Attorney General v. Aapex Environmental Services. Inc. and North American 
Site Developers. Inc. . the Attorney General filed suit against North American, the general 
contractor, and Aapex, the asbestos abatement subcontractor, for environmental violations 
relating to demolition of 150 Causeway Street in Boston as part of the Central 
Artery/Tunnel project. The suit alleges unlawfial asbestos abatement practices in violation 
of the Massachusetts Clean Air Act and unlawful disposal of asbestos at an unapproved site 
in violation of the Solid Waste Disposal Act. 

The Commonwealth v. Almeida's Service Station case involved alleged violations 
of the Stage II vapor recovery device requirements for fuel stations under the Clean Air Act. 
We obtained a consent judgment imposing a $5,000 civil penalty and an injunction 
requiring the gas station to operate in compliance with the Act in the future. 

A case was brought against a commercial property owner. Commonwealth v. Pam 
Realty. Inc. . for allegedly removing and disposing of asbestos from a vacant building in 
Worcester in violation of the Massachusetts Clean Air Act and Solid Waste Disposal Act. 
Bags of asbestos-containing material originating from the property were discovered on the 
side of a road in Millbury. As a result of a mediated settlement, Pam Realty, Inc. paid 
$1 1,000 in civil penalties and reimbursed the Commonwealth $650 pursuant to G.L. c. 21E 
for the cost of proper disposal of the asbestos material. 

B. Hazardous Materials 

EPD brings lawsuits against responsible parties to remediate conditions 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. 

During the year, EPD expended considerable resources on the General Electric- 
Pittsfield matter. Frustrated by the pace of General Electric's efforts to clean up the PCB 
contamination it had caused in the Greater Pittsfield area, the Attorney General, in July of 
1997, called upon the federal EPA to move forward with placing the GE site on the 
Superfund national priority list (NPL), while simultaneously expressing his willingness to 
seek a settlement with GE that would do away with the need to list the site. After EPA 
nominated the site for listing, GE came to the bargaining table, and our office, EPA, and 
other federal, state, and local agencies worked extensively over many months of intensive 
negotiations to try to reach an agreement with GE. 

These mediation efforts were suspended in April 1998, because it appeared that the 
gulf separating the parties was simply too great, especially with regard to issues on the 
clean up and restoration of the Housatonic River. EPA then began implementing an 
aggressive strategy that the Attorney General helped develop that includes administrative 



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clean up orders and proposed NPL listing. Mediation resumed in June 1998 and was 
pending at the end of the fiscal year. 

Apart fi-om the mediation, the Attorney General also worked on a number of other 
matters involving the GE-Pittsfield site. For example, in a number of forums, he supported 
preserving the rights of people who are victims of pollution to seek relief from General 
Electric and other parties that caused contamination. His work in this area includes taking 
the lead in opposing various legislative efforts to cut back on those rights, and submitting 
amicus briefs in opposition to General Electric's claims that the statute of limitations has 
run on various private party claims. 

On March 5, 1998, the Attorney General issued a report on health effects issues 
relating to PCB contamination in Pittsfield and southern Berkshire County. The report 
summarizes discussions that took place at a workshop that was held on February 5, 1 998, to 
discuss these issues. This workshop was convened by the Attomey General as a follow-up 
to a meeting that he held with Pittsfield residents in October of 1997. Participants included 
a select group of outside experts, agency representatives, and concerned citizens in the 
Greater Pittsfield area. 

In Fiscal Year 1998 we finalized settlements with the major parties in the Nyanza 
Superfund Site matter. The site, located in Ashland, became a superfiond site in 1983 and is 
undergoing cleanup by the Environmental Protection Agency and the Massachusetts 
Department of Environmental Protection. The cleanup is expected to cost over $40 million. 
Three consent decrees were entered by the federal district court, providing reimbursement 
for some of the cleanup costs as well as damages for injury to natural resources at the site. 

In December 1997, the Commonwealth and the United States resolved their claims 
against RohmTech, Inc., who was alleged to be a successor to Nyanza, Inc., a dye 
manufacturer. RTI paid the governments approximately $4.2 million, of which $420,000 
was paid to the Commonwealth. The federal and state natural resources trustees received 
$2 million for restoration of Sudbury River and wetlands. The governments also settled its 
claims against Scott Taylor and the estates of Roland Derby, Sr., and Roland Derby, Jr., in 
December 1997. These parties will pay $570,000 over time, of which approximately 
$107,000 will be paid to the Commonwealth. The natural resources trustees received 
$35,000 from this settlement. Finally, in June 1998, a consent decree was entered with PQ 
Corporation, Nyacol Products, Inc., Dr. Robert Lurie, and Dr. Thomas O'Connor. These 
parties will pay a total of $8 million over three years. The Commonwealth trustee for 
natural resources received approximately $230,000 in damages for injury to joint resources. 
Finally, the Commonwealth received approximately $1.4 million in reimbursement of its 
cleanup efforts. 

In Commonwealth v. Microfab. Inc .. a case that involved abandoned, contaminated 
property in Amesbury, we brought suit for the purpose of obtaining an adjudication of 
liability under G.L. c. 21E, and to enforce our priority lien on the property. In December 
1997, the Commonwealth received a judgment for over $1.1 million for past costs it has 
incurred cleaning up this property. 



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In Commonwealth v. Tewksbury Industries. Inc ., the case involves a large auto 
shredder and metal recycler in Tewksbury that has air, water, wetlands, and solid and 
hazardous waste violations, as well as G.L. c. 21E site remediation under an existing court 
decree. Our enforcement compelled the business to shut down last January, and to seek 
bankruptcy protection. The cotirt allowed our joint motion compromising and settling the 
Department of Environmental Protection's claims against Tewksbury Industries in the 
bankruptcy court and has granted the Commonwealth relief from any applicable automatic 
stay. The court allowed our motion for entry of judgment. The settlement includes 
payment of $600,000 in civil penalties to the Commonwealth, to be held for further clean- 
up if necessary, with the remainder paid to the general fund as penalties; and $2 million 
remediation of the subject site under chapter 21E by a third party; and an injunction against 
the current operator, preventing future shredaing. 

In Commonwealth v. Winthrop Wilbur , we sought cost recovery and an injianction 
to require the owners and operators of a gasoline-contaminated site to perform the cleanup 
of their property. The defendants agreed to complete the cleanup and to reimburse the 
Commonwealth $220,000 for past costs incurred by DEP. 

In Commonwealth v. Kaltsas . we settled with the current owners of the Fisherville 
Mills in Grafton, MA for $200,000 for reimbursement of costs incurred by DEP. 
Additionally, the settlement required that the owners transfer the mill to the Central 
Massachusetts Economic Development Authority (CMEDA), which hopes to acquire the 
property by August 1998 and complete the clean-up by Jime 1999. Upon completion of the 
clean-up, CMEDA will transfer the property to a developer with the goal of returning the 
mill to productive use. 

In February, Attorney General obtained a Superior Court judgment against Ethan 
Allen Inc., a national fiimiture company with a service facility in Franklin, Massachusetts, 
and two of the company's employees, requiring the payment of a $75,000 civil penalty for 
an alleged, one-time midnight dumping of eighty-one cans of paints, stains, lacquers, 
thinners and reducers in an environmentally sensitive area of the Town. The judgment in 
Commonwealth v. Ethan Allen, Inc .. also required Ethan Allen to pay the Town up to 
$15,000 to fund a household hazardous waste collection day for the Town's residents that 
will help avoid illegal waste disposal, to perform an environmental audit of the Franklin 
service center and the company's retail outlets, and to institute a new policy for the 
handling of hazardous wastes. 

The defendant in Commonwealth v. ChemDesign Corp .. a manufacturer of 
herbicides and pesticides in Fitchburg, released reportable quantities of monochlorobenzene 
and chlorine gases into the air. It failed to report the releases to the Department of 
Environmental Protection in violation of G.L. C.21E. It also failed to conduct annual 
hazardous waste training, and update its contingency plan and toxics use reduction plan. 
The defendant agreed to pay a $65,000 penalty and conduct a safety assessment of its 
manufacturing processes. 

In Commonwealth v. West Lynn Creamery , West Lynn failed to notify DEP of the 
release of anhydrous ammonia into the ambient air in accordance with state regulations. 
The settlement required West Lynn to pay $59,000 in penalties, and additionally required 



255 



West Lynn to (1) conduct an audit of its refrigeration system; (2) notify users of anhydrous 
ammonia throughout the Commonwealth of the reporting requirement for releases of 
anhydrous ammonia under state law; and (3) conduct a training seminar, with an emphasis 
on ammonia safety, for emergency personnel located within the Greater Lynn area. 

The court entered judgment based on a settlement agreement between the parties in 
Commonwealth v. John Beaudette. Inc .. a hazardous waste cleanup case. The defendant, 
which is also responsible for the cleanup of a contaminated site that was not at issue in this 
case, contended that it was unable to pay for necessary cleanup activities. The judgment 
requires the defendant to perform all necessary cleanup activities at both sites and establish 
an escrow account to fund both cleanups using reimbursements from a state underground 
storage tank fimd into which it pays. The judgment also requires the defendant to make 
payments into the escrow account until both sites are cleaned up and the Commonwealth is 
reimbursed $50,000 for response costs that it has incurred. 

The court entered a consent judgment in Commonwealth v. Peterson's Oil Service. 
Inc .. a case that involved violations of hazardous waste site cleanup regulations. The 
judgment requires the defendant to conduct cleanup activities at an accelerated pace and to 
pay a civil penalty of $35,000. 

In Commonwealth v. Microwave Development Laboratories. Inc .. the court entered 
our consent judgment resolving this hazardous waste cleanup case. The judgment requires 
the defendant to complete the cleanup at its facility in Needham and to continue various 
interim remedial measures currently in place. MDL will make payments into an escrow 
account for 15 years to fund the cleanup measures. The Town of Needham, which 
intervened, will also receive reimbursement of cleanup costs it incurred. 

In In Re: Viacom International. Inc .. we reached an out-of-court settlement with 
Viacom International, Inc., to clean up the Morse Twist Drill Site, an abandoned 
manufacturing facility in New Bedford. This site — in the middle of a low income 
residential area of New Bedford — was contaminated with "cutting oil" from two century- 
old mill buildings, and with other hazardous materials as well. In 1996, citizen activists in 
New Bedford identified the Morse Twist Drill site as the number one brownfields priority in 
the area. The site had been abandoned in 1991 , with the most recent operator going 
bankrupt and the principals returning to Scotland. The Attorney General conducted an 
intensive investigation of the complex history of the site and traced potential liability to 
Viacom, Inc. through a series of very complicated corporate relationships. Viacom agreed 
to a settlement that required the company to conduct a fiill site clean-up. 

In two cases involving underground storage tanks. Commonwealth v. Leary and 
Commonwealth v. Clausen , the defendants were charged with violating the underground 
storage tank (UST) regulations by leaving abandoned USTs in the ground. Under the 
regulations, most USTs used to fuel vehicles must be removed within six months of no 
longer being in use. In stipulations filed in court, the defendants agreed to drain and 
immediately remove the tanks from the ground. 

In an action for recovery of cleanup costs under G.L. c. 21E, in Commonwealth v. 
Thompson , the court allowed our motion for partial summary judgment against the estate of 



256 



the deceased property owner. The estate's counsel had argued that the estate was not liable 
because neither it, nor its executors were the current owners of the property. 

In Commonwealth v. Creative Chemicals. Inc .. we brought a contempt complaint 
filed against the defendant for failure to pay a penalty and conduct environmental auditing 
as required under a final judgment. The defendant subsequently paid the penalty with 
interest and conducted the audit. An amended judgment requires the company to conduct 
an additional audit of the facility, to remove an underground storage tank and put a 
protective shield around an above-ground storage tank. In a related matter, we filed an 
action in Commonwealth v. Peskin to collect from the guarantor when Creative Chemicals 
failed to pay a portion of its civil penalty. We dismissed the action after the company paid 
the penalty, leaving the guaranty in place in case the company fails to make its next 
payment. 

C. Water PollutionAVater Supp ly 

Large water withdrawals require a permit under the state Water Management Act. 
At the request of the Environmental Strike Force, the Attorney General brought the first 
enforcement action under the Water Management Act against a company in Uxbridge, 
Commonwealth v. Hood's Construction Co.. Inc . The complaint in the case alleged that 
Hood's withdrew at least 19 million gallons of water during the summer months fi-om three 
wells and a reservoir, and that this threatened nearby groundwater supplies for residences 
and local business. Hood's trucked much of the water to a nearby power plant — Ocean 
State Power, located in Rhode Island -- for use as cooling water in the plant's operations. 
In settlement of the case. Hood's agreed to pay a $90,000 civil penalty and to stop further 
unpermitted withdrawals of water. Upon settling the case, the Attorney General also sent 
letters to Ocean State Power and other independent power plants notifying them of their 
own responsibilities to identify "back-up" water supplies from lawful, permitted sources or 
risk facing an enforcement claim that they are themselves liable for a Water Management 
Act violation. 

In Commonwealth v. Dracut Water Supply District , the Attorney General brought 
suit against the District under the state drinking water law, in order to ensure a safe and 
reliable source of drinking water to the people of Dracut and Tyngsborough. According to 
the complaint, the District has failed to regularly sample for contaminants in the water 
supply and has allowed the physical components of the system to deteriorate. The 
complaint also details that the District has failed to install necessary equipment, such as 
water level indicators and alarms intended to notify local officials of dangerously low 
supplies of water in storage tanks. The Attorney General also contends that, on occasion, 
the District has left operation of the system in the hands of unqualified personnel and that 
the District has failed to install equipment necessary to safe operation of the system. While 
the suit is ongoing, the preliminary phase was resolved through a settlement in which the 
District agreed to retain an independent environmental consultant to assume operational 
control of the system. The consultant also will conduct a thorough study of the 
management, operations, and financial condition of the District and make recommendations 
for improvements to ensure a safe and reliable water supply to the District's customers. 



257 



The Attorney General filed suit on behalf of the Metropolitan District Commission 
in Commonwealth v. Clealand Blair for the unlawful expansion of a beach and installation 
of a lawn area on the bank of a great pond in Rutland. The pond discharges into the 
Quabbin Reservoir, a drinking water source. The complaint contends that the work violates 
the Watershed Protection Act and seeks an injunction requiring the property owners to 
restore the beach and lawn area to their original condition. 

After settlement negotiations failed in Commonwealth v. Cape Cod Railroad 
Corporation , we filed suit against the corporation, which operated a passenger railroad 
service on Cape Cod, for dumping raw sewage and kitchen wastewater onto its tracks and 
rail yard. In addition, the company improperly stored and disposed of lubricating waste oil 
and illegally removed and stored asbestos-containing material at the rail yard. 

D. Wetlands 

The defendant in Commonwealth v. Pittorino owns 60 acres of undeveloped land in 
Littleton and runs a small excavating company. We alleged that the defendant violated the 
Wetlands Protection Act and enforcement orders from both the Conservation Commission 
and the Department of Environmental Protection by filling about one third of an acre of 
bordering vegetated wetland on his property. After a bench trial, the first one on a wetlands 
case in many years, the court ordered complete restoration of the wetland and a civil penalty 
of $25,000. 

E Solid Waste 

The defendant in Commonwealth v. Gabe & Sons was responsible for dumping 87 
truckloads of asbestos-containing solid waste fi-om the Natick Mall demolition in a 
residential development of Shrewsbury. The court ordered this demolition contractor to pay 
a civil penalty of $75,000 for violating the Solid Waste Disposal Act, G.L. c. 1 1 1, § J50A. 
The penalty supplements the $200,000 paid by Homart and $50,000 paid by Walsh Brothers 
for their roles in the asbestos violations. 

We obtained a consent judgment against the defendants in Commonwealth v. Hyde 
Park Landfill , requiring them to pay $50,000 in civil penalties and to close and cap their 
illegal dump under the supervision of an environmental engineer. Our lawsuit alleged that 
the defendants illegally were using the subject site, "Barry's Quarry," as a dumping ground 
for refuse, including concrete and asphalt debris and discarded kitchen appliances. 

A judgment was entered in 1989 in the Department of Environmental Protection v. 
Rubchinuk case ending the defendant's illegal demolition debris landfilling in Middleton 
and appointing a receiver to close and cap the landfill. After hearing, the court granted our 
motion to modify the judgment to divest the defendant of title to the property, because he 
failed to comply with an agreement he made with the state and the receiver in September 
and an order of the court to deed the title to a non-profit entity designated by the receiver. 
The court also granted our motion to dismiss the defendant's appeal of the September 
divestiture order, found the defendant in contempt, and imposed penalties to force him to 
comply vdth the order. 



258 



F. Pesticides 

We have joined with the Department of Food and Agriculture Pesticide Bureau in an 
effort to stop the deceptive marketing practices of household pesticide applicators. While 
pesticides can be useful, they are toxic by design, and pesticide applicators who use 
comforting, but misleading, claims of safety to sell them put the public at serious risk. 

G. Conservation Restrictions 

Conservation restrictions are statutorily-recognized property interests that are used 
to conserve open space. These interests are held by private conservation groups or by 
municipalities, with the underlying fee interest typically held by an unrelated private party. 
In In Re: Robert Taylor , the Attorney General informed a private landowner that he would 
step in to enforce the terms of a conservation restriction held by the Natural Resources Trust 
of Easton on 21 acres of fields and woods abutting town conservation land. Working 
closely with that conservation group, the Attorney General compelled the landowner to 
enter into an out-of-court settlement requiring him to allow access to the property both for 
compliance inspections and for appropriate recreational use, and to remove an unpermitted 
structure at the site. In its March 1998 issue, the national journal on land preservation 
known as Exchange, published by the Land Trust Alliance, commended the Attorney 
General's actions, pointing to the Easton case as a national model for ensuring that these 
important land preservation tools remain effective. 

H. Clean State Initiative 

An investigation of state-owned underground storage tanks revealed a multitude of 
violations. This is a significant potential problem, in that a single UST leaking in the wrong 
place can cause millions of dollars in environmental harm. Adopting a "prevention first" 
approach, the Attorney General sent letters to agencies and authorities, detailing their 
violations and requesting that they survey their USTs, enter all non-compliant USTs into 
the Clean State database, tightness-test their USTs; and immediately remove all USTs that 
are no longer in use or that fail tightness testing. This resulted in the tightness testing of 
hundreds of state-owned USTs, and the removal or upgrade of many of the state's aging 
USTs. 

The Attorney General continues to exercise his enforcement discretion to bring 
actions against agencies and authorities. EPD began a number of enforcement actions 
against state agencies and authorities this year. They have involved ongoing harm to the 
environment, failure to comply with the terms of administrative consent orders, failure to 
meet Clean State-ordered deadlines and matters that failed to make the Clean State list at 
all. For instance, the Attorney General's Office and the MWRA obtained an interim 
agreement with the MBTA to install a pretreatment system at its Quincy bus wash and to 
cease unpermitted discharges into the sewer system from its Cabot Yard bus steam cleaning 
operation in South Boston. 

The Massachusetts National Guard (MNG) had failed to acquire land around a 
drinking well at the Otis Air Force Base on Cape Cod. In a settlement soon to be concluded 
in Attorney General v. Adjutant General. Massachusetts National Guard . MNG has agreed 



259 



to take all necessary steps to acquire control of this land and to limit daily withdrawals from 
the well until the land is acquired. 

Pursuant to his authority under G.L. c. 12, §1 ID, the Attorney General prepared his 
third report to the Legislature on the Clean State Initiative in Fiscal Year 1998. The report 
discusses the successes of the Clean State Initiative in FY 98, such as the concerted effort to 
address the Commonwealth's underground storage tanks. It also discusses the 
environmental problems that state agencies and authorities have failed to correct, the 
cleanup deadlines that have been missed and the numerous problems originally ranked as 
"priorities" that have been relegated to lesser status. The list of problems requiring 
remediation has grown by over 50% in four years and is expected to increase dramatically 
as environmental audits of state facilities are completed. There are presently about 1 600 
Clean State matters. The professional auditing, which comes in response to 
recommendations made by the Attorney General in 1995, comes extremely late in the 
program and agencies and authorities will have little time to deal with these problems 
before the June 30, 2000 deadline for the resolution of all matters. 

The report criticizes the lack of long-range planning and the failure to adopt specific 
action plans for resolving the problems. It also documents the failure expeditiously to 
develop and match cost estimates for each problem with existing funding. Over 40% of the 
matters do not have funding. The report concludes that the year 2000 goal will be difficult 
to reach without a renewed commitment by the Administration and the agencies to Clean 
State. Lastly, it urges agencies and authorities to develop environmental management 
systems that will enable them to stay in compliance once they have achieved it. 

I. Massachusetts Military Reservation 

While the Massachusetts Military Reservation ("MMR") on the Upper Cape is well 
knovm as one of the Commonwealth's worst environmental disasters, it is also a 
tremendously valuable state resource, with some 14,000 acres of open space (the largest 
undeveloped parcel of state land on the Cape), as well as active Coast Guard and Air 
National Guard air bases. The relatively undeveloped northern portion of the MMR 
includes expanses of forest and lies directly over the recharge areas for many of the Upper 
Cape's existing and potential water supplies. 

The Attorney General, working with Congressman William Delahunt, released three 
reports to help guide Cape citizens and officials in planning for the future use of the MMR. 
The reports identified the legal constraints on future land use, while showing how these 
obstacles can be overcome if the political will exists. The central message is that with 
appropriate leadership and public engagement, there will be opportunities for significant 
changes in the uses of the MMR, even before the long-term leases to the Army, Air Force, 
and Coast Guard expire in 2026. 

On another front, the Attorney General sought and obtained a delay in the 
detonation of over 1000 buried mortar shells that were recently discovered at the MMR. 
We asked for a postponement of the proposed detonation of the shells, because important 
public health questions remained unanswered. Detonating them in the open, as the 
Massachusetts Army National Guard proposed to do, could potentially release toxic 



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substances into the air and ground water. Further, there is an ahemative to open detonation: 
a closed detonation chamber which would largely isolate the blasts and their emissions. 
The Attorney General believes it is critical to establish a consistent, well-thought-out policy 
for disposal of unexploded ordnance at MMR. 

The Attorney General submitted comments on the Defense Department's ("DoD's") 
proposed Range Rule, which is intended to govern the cleanup of federal firing ranges, 
including the ranges in the northern portion of MMR. He questioned the legal authority of 
DoD to issue the rule, and argued that the rule is void to the extent it conflicts with existing 
CERCLA and RCRA regulations. The Attorney General noted that while DoD presented 
its proposed rule as a response to the particular explosives hazards unique to military 
ranges, DoD was in fact proposing to establish a whole parallel — and apparently more 
lenient ~ set of cleanup procedures and risk assessment models applicable only to its 
ranges. Such a parallel set of regulations could have a significantly detrimental effect on 
the cleanups of MMR and other ranges in Massachusetts. 

Finally, the Office of the Attorney General has also been involved in ongoing 
negotiations with the Air Force over natural resource damages at MMR. The Office been 
pressing the Air Force to live up to its commitment to fund a thorough assessment of 
natural resource damages at MMR. While negotiations are still in progress, the Office is 
working to ensure that the necessary assessments will in fact be completed. 

II. 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. 

In Douglas Environmental Associates v. Department of Environmental Protection , 
the Superior Court partially upheld the plaintiffs appeal under G.L. 30A of DEP's denial of 
a permit to construct a landfill in the Town of Douglas, and ordered DEP to issue the permit 
with conditions to be negotiated to protect an endangered species on the site. The court 
reported its decision to the Appeals Court for review, and the case is pending in the 
Supreme Judicial Court. The Attorney General sought and obtained a stay of the Superior 
Court's order pending the appeal. 

In Enos v. Coxe . the Town of Plymouth proposed to expand its wastewater 
treatment system by discharging treated effluent to the Eel River. The Secretary of 
Environmental Affairs certified that the town's Environmental Impact Report complied 
with the Environmental Protection Act, and neighboring citizens sued her. The court 
allowed our motion to dismiss after finding no harm to the plaintiffs attributable to the 
Secretar>''s actions under MEPA. 

The federal district court ordered judgment for the automakers and dealers in 
American Automobile Manufacturers Association v. Department of Environmental 
Protection , on their claim that Massachusetts' mandate that the automakers deliver electric 
cars for sale in Massachusetts in 1998, 1999, and 2000 is preempted by the Clean Air Act. 



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We are awaiting a decision by the Court of Appeals on our appeal. In a related matter, the 
Attorney General filed comments on the National Low Emissions Vehicle Program on 
rules proposed by EPA to govern the terms upon which Northeastern States would 
voluntarily participate in the NLEV Program. The comments focus on the EPA's insistence 
that States would not be able to withdraw from the program even if it turns out that the 
program is less effective in reducing ozone than alternatives foreclosed by the NLEV 
program. The final version of the regulations did not require that Massachusetts participate 
in the program. 

In the Appeals Court case of Conservation Law Foundation v. Tiemey . we defended 
the Executive Office of Environmental Affairs' decision to allow the Massachusetts Bay 
Transportation Authority to raise fares in 1 99 1 , without first preparing an environmental 
impact report. 

III. New Legislation 

A. Brownfields 

The Attorney General's legislative efforts focused on securing passage of a 
brownfields bill to spur clean ups and redevelopment, especially in areas of economic need. 
Initial efforts focused on supporting a bill that the Attorney General filed in conjunction 
with Representative Charlotte Richie (House Bill 4334). He then worked with members of 
the Joint Committee on Natural Resources and Agriculture, the House and Senate 
Committees on Ways and Means, and an appointed Conference Committee to secure 
passage of a comprehensive bill. Throughout, he pushed for language that would do more 
to target help for those areas in real economic need, would not extend tax credits to those 
entities that caused the pollution in the first place, and would appropriately preserve the 
rights of victims of pollution to sue the original polluters. A bill was enacted into law in 
early FY 1999. 

B. Energy Restructuring and Energy Facility Siting 

This was another busy year on energy issues because of the restructuring of the 
electric utility industry in Massachusetts. EPD pushed for greater environmental benefits in 
the electric restructuring legislation that became law in November 1 997. At the Attorney 
General's urging, the new law includes substantial ratepayer funding for energy efficiency 
programs and clean renewable power sources over the next five years. Also, EPD entered 
settlements on energy efficiency with three electric companies that resolved issues 
regarding the implementation of the new law and augmented funding for energy efficiency 
during the transition to the legislated levels over the next two years. 

As a result of our efforts during the last year, the Energy Facilities Siting Board's 
organic statute was amended to include a provision to ensure that newly proposed plants 
will be examined against the cleanest possible fossil fliel technology currently available. 
Incorporated into new G.L. c.l64, § 69JI/2, applying to generating facilities, is the 
"technology performance standard." The Board is required to set periodically a TPS for 
each of a number of air and other impacts. If a newly proposed plant's impacts in the 
covered categories are higher than the TPS, the proponent will be required to perform a flill 



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comparative review of the plant's impacts against those of all reasonably available fossil 
fiiel technologies. If the proposed plant's impacts meet the TPS, no comparative review 
will be required, and the siting process will be simpler and less costly for all involved. 

IV. National Air Pollution Issues . 

The Office of the Attorney General is deeply involved in many Clean Air Act issues 
of national importance. 

A. Ozone «& Fine Particulate NAAOS 

EPA issued regulations in July of 1997 to tighten the national ambient air quality 
standard (NAAQS) for ozone, and to issue a new standard for fine particulate matter that 
causes health problems by lodging deeply within people's lungs. The Attorney General had 
previously testified strongly in favor of the new standards. The issuance of the regulations 
prompted over 60 legal challenges by industry interest groups, midwestem utilities, and the 
states of Michigan, Ohio, and West Virginia. On behalf of the Commonwealth, the 
Attorney General intervened in defense of the new standards. The states of New York and 
New Jersey have also joined the fight on our side. The multitude of legal challenges have 
been consolidated into two cases by the D.C. Circuit Court of Appeals ( American Trucking 
Associations. Inc.. v. Environmental Protection Agency ). 

B. Interstate Transport Petitions 

In August of 1997, Massachusetts and seven other states filed petitions with EPA 
asking that agency to clamp down on emissions fi-om large power plants in the Ohio River 
Valley. Many of these plants are otherwise "grandfathered" from having to comply with 
modem air pollution standards. The petitions document how the pollution fi-om these plants 
blows eastward, causing us significant problems in meeting nadonal ambient air quality 
standards. This causes not only environmental problems, but economic ones as well, in 
light of the competitive advantage reaped by the Midwest in being able to export its 
pollution problems to the Northeast. 

The filing of the petitions led to much wrangling. Rather than act on the petitions, 
which if granted would have required direct action by EPA against the power plants, EPA 
preferred to try to resolve the controversy by forcing the Midwestem states themselves to 
solve the problem, and it kept granting itself extensions on reviewing the Northeastern 
states' petitions. The Northeastern states agreed to provide EPA the opportunity to solve 
the problem in the manner it preferred, in return for EPA's agreement to mle on the 
outstanding petitions by April of 1999. We and EPA are currently defending that 
agreement in two federal court challenges brought by Midwestem power plants. 

C. National Energy Efficiency Standards 

In part through our efforts, new and tighter federal energy efficiency appliance 
standards will become a reality. The U.S. Congress has passed appropriations for FY 1998 
providing funds for energy efficient programs of the Department of Energy, as we urged the 
Congress to do. Funded programs include the Codes and Standards program, which 



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provides funding and technical assistance to states and national consensus organizations on 
code development, adoption, and implementation, and which also develops revisions to 
federal appliance and equipment efficiency standards. 

V. Si gnificant Hearings. Amicus Briefs, etc. 

The Federal Energy Regulatory Commission granted our petition for rehearing in 
Vermont, et al. v. FERC . regarding the relicensing of the Deerfield River Hydropower 
Project, which spans both Massachusetts and Vermont. Based on a recent Second Circuit 
decision issued in a case in which we had joined as amicus, we successfully argued that 
FERC has no authority to reject, and must incorporate, all state water quality conditions 
contained in a Clean Water Act § 401 certificate into the project's license. The new 40- 
year license contains provisions for fish passage, Whitewater releases, minimum flows, 
hiking trails, decommissioning, and environmental education. Permanent environmental 
restrictions will be placed on the lands abutting the project. 

We drafted a letter to United States Senator Jeffords, sponsor of the Federal FDA 
Modernization and Accountability Act . S.830, a federal bill that in its proposed form would 
broadly pre-empt state regulation of nonprescription drugs and cosmetics. The letter 
expressed our serious concern and urged modification of the bill to limit the reach of state 
law preemption. 

We provided EPA with certification of DEP's authority to promulgate universal 
waste, toxicity characterization, and satellite accumulation rules, under the federally 
delegated RCRA program. 

We joined seven other Attorneys General, and EOEA, in a petition to EPA urging 
the agency to require that pesticides manufacturers list all ingredients on pesticide labels. 
Currently, ingredients other than the designated pesticidal chemical are listed generically as 
"inerts," notwithstanding that such non-disclosed ingredients can include potentially 
harmfial chemicals. 

We responded to a request for comments from the Senate Ways and Means 
Committee on the Massachusetts Pesticide Disclosure Act, S.1887, a bill that would 
facilitate public access to information about pesticides applications in the Commonwealth. 
The Attorney General expressed his strong support for the public's right to know about the 
use of pesticides in the Commonwealth and offered drafting suggestions. 

The D.C. Circuit affirmed ~ with two limited exceptions ~ the National Oceanic 
and Atmospheric Administration's natural resource damage regulations under the Oil 
Pollution Act. State of Georgia v. U.S. Department of Commerce . This Office joined 
approximately 12 other states on an amicus brief to support the regulation against an 
industry challenge. Among other benefits, the court affirmed the validity of "passive use" 
damages under the Act; although not directly applicable, this lends some legal support to 
our passive use claim against GE in the Housatonic/Pittsfield case. The decision also 
should help support our enforcement efforts in some oil spill cases in the future. 



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CENTRAL ARTERY/TUNNEL PROJECT CIVIL COST RECOVERY 

During Fiscal Year 1998, a new unit was formed within the Government Bureau to 
focus on civil cost recovery in the $10.8 billion Central Artery/Tunnel Project ("CA/T 
Project"). The work of the CA/T Project Civil Cost Recovery unit, presently made up of an 
attorney director and support staff, often is performed jointly with the Criminal Bureau or 
the Business and Labor Protection Bureau. The unit has diverse responsibilities with 
respect to the CA/T Project in addition to the investigation and prosecution of fraud cases 
and other cost-recovery matters, including: participation in the activities of the CA/T 
Project Oversight Coordination Commission; working with CA/T Project personnel and 
coimsel to implement effective cost-containment and anti-fraud measures, including 
procedures to reduce the incidence and cost of defensive litigation; and the promotion of 
legislation that would facilitate civil cost-recovery actions by the Commonwealth. 

L The CA/T Project 

The CA/T Project, which is being administered by the Massachusetts Highway 
Department, has been described as the largest, most complex, and technologically most 
challenging highway project in the history of the United States. Among other things, the 
Project will replace Boston's deteriorating and inadequate elevated Central Artery (part of 
Interstate 93) with an eight-lane imderground expressway, will extend the Massachusetts 
Turnpike (Interstate 90) to Logan Airport via the Ted Williams Tunnel under Boston 
Harbor, and will create 27 acres of open space in the heart of the city. The Project is 
designed to improve traffic flow and traffic safety in one of the country's oldest and most 
congested cities, utilizing a number of state-of-the-art engineering and construction 
techniques. 

The estimated total cost of the CA/T Project, the time anticipated for its completion, 
and the portion of the costs to be paid by the Commonwealth have grown substantially over 
the past decade. In 1989, CA/T Project management estimated that construction would be 
completed in 1998 at a cost of $4.4 billion; the Project now targets completion in 2004, at a 
cost of $10.8 billion. The federal government previously had assumed responsibility for 
approximately 90 percent of the Project's costs, but a new federal funding formula requires 
the Commonwealth to pay a larger share of the costs. All of these factors make effective 
oversight and cost-recovery activities even more critical for Massachusetts taxpayers. 

Over the past several years, the Attorney General has engaged in numerous 
investigations, civil lawsuits, and criminal prosecutions pertaining to the CA/T Project. The 
Government Bureau, for example, recently defeated at trial the nearly $100 million claim by 
Spaulding Rehabilitation Hospital that the CA/T Project contractually was obligated to take 
the hospital by eminent domain and pay for its relocation (the case is now on appeal); the 
Trial Division has saved the CA/T Project more than $72 million in inflated compensation 
claims brought in connection with eminent domain takings; and the Administrative Law 
and Trial Divisions successfully defended the CA/T Project's selection of a parallel-bridge 
redesign plan for the Charles River crossing. The new CA/T Project Civil Cost Recovery 
unit in the Government Bureau allows for enhanced coordination of activities within the 
Attorney General's Office, and a more focused and productive relationship with CA/T 
Project management and others involved with the Project outside the office. 



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II. Oversight Coordination Commission 

The Attorney General, the State Auditor, and the Inspector General make up the 
CA/T Project Oversight Coordination Commission ("the OCC"), a body charged by the 
Legislature with responsibility for coordinating oversight efforts among the three offices. 
The OCC became operational in January 1997, with the release of its funding, making 
Fiscal Year 1998 the OCC's first full year of operation. Senior staff from each office, 
including the director of the Government Bureau's CA/T Project Civil Cost Recovery unit, 
meet monthly to discuss activities and plans, and invite legislators to attend special 
meetings held quarterly. 

III. Other Cost Containment and Recovery Measures 

The Attorney General's Office established a toll-free 24-hour telephone "hotline" to 
help identify fraud, waste, and abuse on the CA/T Project. The Attorney General's Big Dig 
Fraud Hotline - 1-888-TIP-BGDG (1-888-847-2434) ~ is answered by the Attorney 
General's staff during business hours and by voicemail at all other times. Calls that can be 
better addressed by a different agency, such as the State Auditor or the Inspector General, 
are referred accordingly. All calls to the hotline are confidential. 

An anti-fraud and cost-containment training seminar, including CA/T Project 
management and a nationally-recognized expert in the field of public construction fraud, 
was held by the Attorney General in March 1998. This seminar, building upon a previous 
seminar held in 1997, focused upon potential vulnerabilities of the CA/T Project to fraud, 
and upon various cost-containment and anti-fraud measures that could be employed on the 
Project. 

The Attorney General co-sponsored False Claims Act legislation. House Bill 4164, 
that significantly would enhance the ability of the Commonwealth to recover state funds 
that are obtained improperly through the submission of false claims or false statements to 
the Commonwealth, or to its agencies or contractors. Passage of the legislation would be of 
special significance with regard to the CA/T Project, which is disbursing billions of dollars 
to hundreds of contractors and is entering its peak construction period. 

The False Claims Act would authorize the Commonwealth to recover treble 
damages, civil penalties, costs, and attorney's fees from defendants found to be liable for 
submitting false claims and statements for Commonwealth funds. In addition, a 
"whistleblower" provision would encourage private individuals to come forward with 
information as to such activities, by allowing them to share in the Commonwealth's 
recovery under certain circumstances and protecting them from retribution by their 
employers. The statute also would authorize the Attorney General to use new investigatory 
tools before a case is litigated, in order to determine whether the allegations warrant further 
action. Following discussions of the False Claims Act at quarterly meetings of the OCC, 
attended by legislative staff, the Senate in March 1998 engrossed legislation substantially 
identical to the House bill. The Attorney General has reviewed the bills, proposed technical 
amendments to facilitate the implementation of the statute, and urged enactment of the 
legislation. 



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The Attorney General is compiling a consolidated database of all contractors and 
primary subcontractors on the CA/T Project, with information obtained from the CA/T 
Project and OCC members. The consolidated information will facilitate investigations for 
civil cost-recovery actions and criminal prosecutions. 



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THE WESTERN MASSACHUTTS DIVISION 

The Western Massachusetts Division of the Office of the Attorney General, located 
in the State Office Building at 436 Dwight Street, Springfield, is a part of the Executive 
Bureau. The Division is responsible for all legal matters arising in the four western 
counties, Hampden, Hampshire, Franklin, and Berkshire. The Division is staffed by eleven 
assistant attorneys general, three civilian investigators, four paralegals, three Massachusetts 
State Police Officers, and additional support staff In addition, an attorney and an 
investigator assigned to the Medicaid Fraud Unit are part of the staff 

The Western Massachusetts Division has defensive and affirmative litigation 
responsibilities and, as well, fields and handles a large number of consumer-related 
complaints for area residents. The Western Massachusetts Division also takes part in a 
variety of community-oriented public safety, quality of life, and violence prevention 
programs such as the Drug Den Elimination Program, the Abandoned Housing Project, and 
the Springfield City- Wide Violence Prevention Task Force. This year the Western 
Massachusetts Office of the Attorney General began a Safe Neighborhood Initiative in 
Montague, Massachusetts in partnership with the District Attorney for the Northwestern 
District, Elizabeth Scheibel. In addition, efforts are being made towards the establishment 
of a Weed and Seed Program in Springfield in partnership with the United States Attorney's 
Office, the District Attorney for Hampden County William Bennett, and the Hampden 
County Sheriff Michael Ashe. 

The Attorney General's Municipal Law Unit was moved to Western Massachusetts 
during this fiscal year. The MLU's primary responsibility is to perform the Attorney 
General's statutory review of municipal by-laws and charter amendments to ensure that 
these laws are consistent with the constitution and laws of the Commonwealth. Since the 
MLU moved to Springfield and acquired dedicated space, it revised the file handling 
procedures and computerized file tracking, achieving major improvements in speed, 
efficiency, and accuracy. Most reviews are completed wathin sixty days of receipt. During 
fiscal year 1999, the MLU expects to complete (1) a major revision and simplification of 
the forms and procedures that govern the submission of by-laws for review and (2) a revised 
guidebook for town clerks. The MLU is exploring additional ways to increase its 
accessibility to the towns and the general public, for example by expanding its use of the 
Internet, assembling sample or model by-laws, and reexamining the various means by 
which by-laws are submitted and approved or disapproved. 

Summary of Defensive Litigation 

In the area of defensive litigation, the Western Massachusetts Division defends the 
Commonwealth in administrative law, contract, eminent domain, civil rights, and torts 
cases. At any given time there are approximately 130 open defensive cases. 

In fiscal year 1998, the following number of new defensive cases, by category, were 
opened: 

Administt-ative: 24 (38.7%) 
Eminent domain: 3 (4.8%) 



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Torts: 20 (32.3%) 

Civil rights: 8 (12.9%) 

Miscellaneous: 7 (11.3%) 

Total: 62 (100%) 

In fiscal year 1998, 67 defensive cases were closed, either by way of settlement, 
trial, dispositive motion or voluntary dismissal, for a through-put rate of 108%. The total 
amount of money awarded plaintiffs in tort, breach of contract, and civil rights suits, either 
by way of settlement or trial, was $1 15,650.00. The total amount of money paid by 
settlement or trial in eminent domain cases was $1,1 1 1,525.00. 

Two cases were tried before a jury in Superior Court. One was the Das case, tried by 
AAG Cynthia J. Gagne and described below as a highlight, in which a verdict in favor of 
the state was rendered. The other was Wallerstein v. Commonwealth (Berkshire Superior, 
Civ. Ac. No. 96-249), an eminent domain case arising from the acquisition of a waterfront 
parcel in Pittsfield which was tried by AAG Rosemary Tarantino. An offer to settle for 
$8200 had been made and the jury awarded the plaintiffs $14,100, which represented only 
$8400 in "new money" (over what had been already paid). 

Defensive Case Highlights 

( 1 ) Peter A. Das v. Commonwealth of Massachusetts (Hampshire Superior Court, 
Civ.Ac. No. 95-038). The plaintiff jackknifed his tractor trailer on 1-91 in Whately when he 
passed another trailer and then saw a parked MSP cruiser which was parked partially in the 
passing lane in order to assist in the towing of a disabled vehicle in the median. Upon 
exiting his trailer, the plaintiff was struck by another car and pinned against his trailer, 
resulting in the traumatic amputation of his right leg. The plaintiff claimed that the cruiser 
was negligently positioned, especially given the intermittent snow squalls. A three-day jury 
trial ended with a defense verdict. The case was handled by AAG Cynthia J. Gagne with 
assistance at trial from AAG Edward Berlin, Chief of the WMAS Division. 

(2) Andrew Day v. Massachusetts Air National Guard et al. (United States District 
Court, Case No. 96-30126-MAP; case is reported: Day v. Massachusetts Air Nat 7 Guard, 
994 F.Supp. 72 (D. Mass. 1998)). The plaintiff Air National Guardsman alleged that he had 
been the victim of a severe hazing incident while on assignment in Wisconsin, the most 
serious aspect of which hazing involved an attack during which he was stripped and 
subjected to the insertion of a traffic cone between his buttocks for an alleged "photo 
opportunity." This Office defended MANG against various state and federal civil rights 
claims as well as five common-law tort theories. The District Court adopted our argument 
that the suit was barred by the Feres doctrine, which disallows civil actions by military 
personnel against the military. The case is on appeal to the First Circuit but not as to 
MANG. The case was handled by AAsG Greg Williams and Cynthia J. Gagne. 

(3) Thomas R.W. v. Massachusetts Department of Education et al. (United States 
District Court; case is reported: Thomas R. \V. v. Massachusetts Dep't ofEduc. 130 F.3d 
477 (1st Cir. 1997)). The plaintiff, a private-shool student with disabilities, claimed that he 

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was entitled to a 1 : 1 aide at public expense at the private school, even though the local 
school district offered to provide the aide in the public school and there was no claim that 
the public school could not provide the student a fair and appropriate public education. The 
Bureau of Special Educational Appeals reached the constitutional and statutory construction 
issues and found in favor of the local school district. The United States District Court 
granted summary judgment for the town and state on the basis that the plaintiff had not 
demonstrated that the individualized education plan was inappropriate and so the 
constitutional and statutory issues should not be considered. The plaintiff appealed, and by 
the time the case was docketed in the First Circuit, the student had graduated. The 
defendants argued in the First Circuit that the plaintiff in his complaint had not made a 
specific claim for reimbursement, but only for injunctive relief, and thus the appeal was 
moot. The First Circuit agreed. The case was handled by AAG Judy Zeprun Kalman. 

(4) Stockbridge v. Massachusetts Highway Department and Department of 
Envirormiental Protection (Berkshire Superior Court, Civ. Ac. No. 97-0323). The plaintiffs. 
Town of Stockbridge and fifteen pro se citizens of Lenox, sought to enjoin the Routes 7 & 
20 road-widening project in the Berkshires. After an eight-day administrative hearing which 
involved testimony from twelve experts, DEP had granted MHD a variance from wetland 
regulations which allowed the project to proceed. The plaintiffs lost their motion for 
injunctive relief Although Stockbridge withdrew from the appeal of this denial, the pro se 
plaintiffs vowed to fight on. The administrative record consisted of over 6500 pages. The 
plaintiffs were advised that costs must be sought since the plaintiffs refiised to stipulate to a 
limited record and it cost over $1400 just for the photocopying and binding of the record. 
Some of the pro se plaintiffs began dropping out of the suit. Eventually, the plaintiffs all 
agreed voluntarily to dismiss the claims except for two plaintiffs, whose claims were then 
dismissed for failure to prosecute. This complex and troublesome case was handled by 
AAG Kristi Bodin. 

(5) Joseph William Dayall v. Board of Registration of Hazardous Waste Site 
Cleanup Professionals (Hampshire Superior Court, Civ. Ac. No. 96-099). This case was the 
first civil action for judicial review of a decision of this Board. The Board had denied the 
plaintiffs application to be a licensed site professional. The court rejected the claims of the 
plaintiff and of the amicus curiae Licensed Site Professional Association that the Board was 
required here to defer to the magistrate's recommendation and ruled, inter alia, that the 
Board had permissibly concluded that the plaintiff lacked the requisite professional 
experience to be licensed and that the Board had not violated the Open Meeting Law by 
deliberating behind closed doors. The case was handled by AAG James Whitcomb. 

(6) Frank Barrett-Mills and Marjorie Barrett-Mills v. Department of Social Services 
et al. (Hampshire Superior Court, Civ. Ac. No. 97-313). The plaintiffs appealed a DSS fair 
hearing decision to close their home to future foster-care placement generally and as an 
adoption resource to a particular child, Yolanda. In addition to usual 30A claims, the 
plaintiffs alleged that the decision violated their "substantial rights" in that it prevented 
them from pursuing fiiture adoptions with the DSS and, interpreted liberally, that it violated 
a constitutional liberty interest in their status as foster parents to Yolanda. Further, they 
alleged that the fair hearing itself violated procedural due process rights. The court adopted 

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the position of the defendants that no Hberty interest in foster parenthood existed and thus 
claims flowing from that status must fail. The case was handled by AAG Judith J. Phillips. 

Affirmative Litigation 

In the area of affirmative litigation, the Western Massachusetts Division prosecutes 
pro-active civil rights, consumer protection, and criminal cases. 

Summary of Affirmative Civil Cases 

This office fields thousands of inquiries and complaints. By effectively using a 
weekly case intake process in which attorneys, investigators, and a coordinator participate, 
potential cases are identified, reviewed, investigated, and screened-in for further 
development and litigation or at some point in the process, screened-out. In fiscal year 
1998, an average of 20 - 25 civil affirmative litigation cases were open at any given time. 
In fiscal year 1998, 14 civil affirmative litigation cases were closed and 7 were made 
inactive. In addition, 23 cases were screened-in, investigated, but closed without lifigation. 

Affirmative Civil Case Highlights 

ril Comm. V. Fletcher . Hampden Superior Court, Civil Action No. 98-97. In this 
case, an adult male verbally accosted two African-American boys in a restaurant with racial 
epithets, telling them among other things, that they should leave. He then physically 
accosted a parent of the children. We obtained a judgment under which the defendant 
agreed to refrain permanently from violafing civil rights. 

(2) Comm. v. Condor/Falcon Chevrolet . Berkshire Superior Court, Civil Action 
Nos. 96-270 and 96-271. Two Berkshire County car dealers, under the same ownership, 
allegedly committed a panoply of classic consumer protection violations, including not 
honoring warranties, misrepresenting conditions of cars offered for sale and other material 
aspects of deals, and falsely advertising vehicles for sale. The final judgments provided for 
permanent injunctive relief and a civil penalty of $25,000.00. In addition, the dealers paid 
$67,253.00 in consumer relief to complainants. 

(3) Comm. v. King of Bay Street . Hampden Superior Court, Civil Action Nos. 98- 
68 and 98-69. Two related used car dealerships committed numerous consumer protection 
violations in connection with the sale and leasing of used cars. Over the years, the 
Springfield OAG received a or became aware of 84 consumer complaints against the 
businesses. We alleged violations of G.L. c. 255B, as well as, misrepresentations and 
failures to honor warranties, among many other claims. The final judgments provided for a 
$10,000.00 civil penalty, $15,847.00 in consumer relief, along with permanent injunctive 
relief 

Summary of Criminal Litigation 

In the area of criminal litigation, the Western Massachusetts Division investigates 
and prosecutes a variety of cases, ranging from bank fraud, public integrity, credit card 
fraud, and attorney defalcation to narcotics and illegal weapons cases. Many of these cases 



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involve long, complex, and labor intensive investigations. In the fiscal year 1 998, twenty 
indictments were returned in Superior Court against four individuals. Twelve complaints 
out of the District Courts issued. Five cases were resolved. Numerous additional cases were 
investigated but closed without prosecution. 

Criminal Case Highlights 

(1) Commonwealth v. Adekanbi 

The defendant, a Nigerian citizen pled guilty to numerous charges which arose out 
of a multi-faceted bank scam. The defendant established numerous false identities and 
succeeded in defrauding the Peoples Bank, Holyoke, of $78,500 and almost succeeded in 
defrauding the BankBoston, East Longmeadow, of another $75,000. The latter attempt was 
thwarted as a result of the issuance of a bank alert by MSP assigned to WMAS Division. 
The defendant was sentenced to two consecutive two-year terms to be served at the House 
of Correction; five years probation to be served consecutively, $8,500 restitution to be 
made. 

(2) United States v. Mickey Moriarty (joint prosecution with U.S. Attorney") 

This case arose out of the joint investigation of activity at the Hampden County 
courthouse, at which the defendant was a telephone technician. The defendant was accused 
of illegally accessing voice mail of courthouse employees and obstructing justice when he 
told a witness who was to be brought into the Grand Jury by us, what to say and what not to 
say. After pleading guilty to the lead charge, obstruction of justice charge, the defendant 
received a sentence of two years of supervised probation with six months of community 
confinement. 



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