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

Public Document

No. 12

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Report of the
Attorney General
for Fiscal Year 2002

July 1, 2001 - June 30, 2002

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467

002

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of this Document Approved by Philmore Anderson HI, State Purchasing Agent.
Publication Number 1024-286-720-1 1/03-4 .95-Docuprint

Public Document

No. 12

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Report of the
Attorney General
for Fiscal Year 2002

July 1, 2001 - June 30, 2002

Publication of this Document Approved by Philmore Anderson III, State Purchasing Agent.
Publication Number 1024-286 720-1 1/03-4.95 Docuprint

State Library of Massachusetts
State House, Boston

7 002.

7 2-

The Commonwealth of Massachusetts
Office of the Attorney General

One Ashburton Place

Thomas F. Reilly BOSTON, MASSACHUSETTS 02 1 08- 1 698

ATTORNEY GENERAL

In accordance with the provisions of Section 1 1 of Chapter 1 2 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, 2001 to
June 30, 2002.

Respectfully submitted,

Attorney General

TABLE OF CONTENTS

ASSISTANT ATTORNEY GENERAL APPOINTMENTS i

EXECUTIVE BUREAU 1

General Counsel's Office 1

Human Resource Management Office 4

External Affairs Office 6

Information Technology Division 7

Budget Office 9

Operations Division 10

Communications Office 12

BUSINESS AND LABOR PROTECTION BUREAU 17

Fair Labor and Business Practices Division 17

Insurance and Unemployment Fraud Division 24

Medicaid Fraud Control Unit 31

COMMUNITY-BASED JUSTICE BUREAU 41

Victim Compensation and Assistance Division 50

Safe Neighborhood Initiative Division 54

CRIMINAL BUREAU 71

Appellate Division 73

High Tech and Computer Crime Division 77

Public Integrity Division 82

Victim/Witness Assistance Division 88

Special Investigations and Narcotics Division 95

Economic Crimes Division 104

Environmental Crimes Strike Force 109

Financial Investigation Division 113

Consumer Protection Prosecution Unit 1 18

Central Artery/Tunnel Project 121

TABLE OF CONTENTS

GOVERNMENT BUREAU

127

Administrative Law Division

131

142

PUBLIC PROTECTION BUREAU

Civil Rights and Civil Liberties Division

Consumer Protection and Antitrust Division

Environmental Protection Division

153

154

165

176

193

204

207

216

Mediation Services Division

REGIONAL OFFICES

231

237

246

256

APPENDIX

The Attorney General's Formal Opinions

follows page 264

APPOINTMENTS

Fiscal Year 2002 (7/1/01 - 6/30/02)
OFFICE OF THE ATTORNEY GENERAL

ATTORNEY GENERAL, THOMAS F. REILLY
FIRST ASSISTANT ATTORNEY GENERAL, DEAN RICHLIN

ANNACKIL

MICHELEADELMAN (23)

DOROTHY ANDERSON (30)

DAVID ANDREWS

MARION ANTONUCCI

JAMES ARGUIN

MICHAEL ATLESON (52)

FREDERICK AUGENSTERN

STEVEN BADDOUR (34)

EVABADWAY

LORIBALBONI (43)

THOMAS BARNICO

CHRISTOPHER BARRY-SMITH (17)

JASON BARSHAK

R. DAVID BECK

ANNETTE BENEDETTO

BARBARA BERENSON (57)

MATTHEW BERGE

CRISPIN BIRNBAUM

NANCY BLOOMBERG

WILLIAM BLOOMER

EDWARD BOHLEN

WILNERBORGELLA

JENIFER BOSCO (37)

JOHNBOWEN

MARTHA BOWER (36)

JOHN BOWMAN

MATTHEW BROCK

MATTHEW BUEHLER

RANJANA (Chand) BURKE

STEVEN CALDER (14) (54)

JOSEPH CALLAN AN (10)

ROMEO CAMBA

JESSE CAPLAN

SANDRA CARDONE

ERICCARRIKER
EUGENIA CARRIS (52)
JAMES CARUSO, JR (49)
PATRICK CASSIDY (14)
ALOKE CHAKRAVARTY
NORACHOROVER(14)
JOHNCHRISTINJR.
LAWRENCE CHRISTOPHER (19)
JAMES CLARK
PETER CLARK
STEPHEN CLARK
ALEXANDER COCHIS
RICHARD COLE
JOANNA CONNOLLY (49)
ROSEMARY CONNOLLY
MARGRET COOKE
PATRICIA CORREA
DAVID COSGROVE (5)
ARLIECOSTINE-SCOTT (49)
PIERCE CRAY
JOHNCRIMMINS
JOHNCURSEADEN
WILLIAM DAGGETT (49)
PAMELA DASHIELL
GERALD DAVOLIO JR.
THOMAS DEE
LINDA DELCASTILHO
BARBARA DILLON DESOUZA (14)
STEPHEN DICK
JOSEPH DRISCOLL (47)
ANNE EDWARDS (31)
ANNEEDWARDS(12)(44)
KIRSTEN ENGEL
BENJAMIN ERICSON (13)
BARBARA FAIN

JAMESD.RFARRELL
DANIEL FIELD
FREDA FISHMAN (37)
DOROTHY FOLEY (16) (55)
ELIZABETH ANN FOLEY
MARYFREELEY
CYNTHIA GAGNE (26)
RAFAEL GARCIA (39)
DANA GERSHENGORN (32)
MARIANNE GEULA
SALVATORE GIORLANDINO
I. ANDREW GOLDBERG
CARYN GORDON (27)
RICHARD GORDON
ELIOT GREEN
CATHERINE GREENE (40)
HANNAH GREENWALD
JOHN GROSSMAN
DANIEL HAMMOND
JOHNHANRAHAN (55)
NANCY (BETSY) HARPER
KATHERINE HATCH
JANICE HEALY
MICHAEL HERING (18)
HILARY HERSHMAN
MURIEL HERVEY (33)
SARAHINCHEY(3)
JOHNHITT
BART HOLLANDER
PAMELA HUNT
MARSHA HUNTER
CAROL IANCU
MATTHEW IRELAND
DEEPA ISAC (7)
MARCIA JACKSON (58)

APPOINTMENTS

MARIA HICKEY JACOBSON
JOCELYN JONES
TIMOTHY JONES (1)
ROSALIND KABRHEL (14)
MICHELLE KACZYNSKI
STEPHANIE KAHN
JUDYKALMAN
GLENN KAPLAN
JAMIE KATZ
RONALD KEHOE (12)
DAVID KERRIGAN
KATHARINE KLUBOCK (21)
MARK KMETZ
URSULA KNIGHT (4)
PAMELA KOGUT
NICKKOSIAVELON
SIUTIPLAM
JUDITH LASTER
ANDREW LATIMER (25)
KELLI LAWRENCE
DIANE (Szafarowicz) LAWTON
ANGELA LEE (45)
PATRICK LEE (3)
PETER LEIGHT
GERARD. JR. LEONE (37)
MADELINE LEONE
CAROLYN LONG
STEPHANIE LOVELL
ANITA MAIETTA
MARIA MAKREDES
TIMOTHY MALEC (9)
M.TONIMALONEY (28)
DAVID MARKS
LAURA MARLIN
STEPHEN MARSHALEK (9)
LAURA MASLOW-ARMAND
TINA MATSUOKA (7)
DEAN MAZZONE
TIMOTHY MCDONOUGH (42)
PHILIP MCGOVERN
CONSTANCE MCGRANE
TIMOTHY MCGUIRE (6)
MICHAEL MCNALLY (2)

WILLIAM MEADE
PATRICIA MEDEIROS (8)
PAMELA MEISTER
BETH MERACHNIK
HOWARD MESHNICK
NICHOLAS MESSURI
JAMES MILKEY
ALEXANDRA MOFFATT (53)
PAULMOLLOY
BRIAN MONAHAN
DAVID MONAH AN
ALICE MOORE
MARKMULDOON
MARK MULLIGAN
DAVID NALVEN
CATHRYNNEAVES
AMYNECHTEM (41)
EILEEN O'BRIEN
JAMES O'BRIEN
THOMAS O'BRIEN
JOHNO'LEARY
MARYO'NEIL
WILLIAM O'NEILL
KRISTENO'ROURKE
DONNA PALERMINO
EMILY PARADISE
WILLIAM PARDEE
HOLLY PARKS
MARGARET PARKS
MAITE PARSI
M. JULIE PATINO
ROBERT PATTEN
PETER PAULOUSKY
SUSAN PAULSON
ANTHONY PENSKI
MARY A. PHILLIPS
MARY B.PHILLIPS
WILLIAM PORTER
ANNE POWERS
STEPHEN PRUNIER (46)
CHRISTOPHER QUAYE
JASON QUEENIN
KATHLEEN QUILL (15)

ROBERT QUINAN

KARLEN REED

RENE REYES (7) (56)

WILLIAM REYNOLDS

JULIANA RICE

DEANRICHLIN

ROBERT RITCHIE

LENA ROBINSON (38)

BEVERLY ROBY (40)

ANTHONY RODRIGUEZ (48)

JOSEPH ROGERS

DEIRDRE RONEY (9)

DEIRDRE ROSENBERG (49)

JULIE ROSS

AMY ROYAL

MARY RUPPERT (50)

PETER RUSSELL

FRANK RUSSO

PETER SACKS

ERNEST SARASON

KURT SCHWARTZ

JEFFREY SHAPIRO

MATTHEW SHEA

PATRICIA SIEFER (35)

ADAM SIMMS

GINNYSINKEL

JOHANNA SORIS

AMYSPECTOR

CHRISTOPHER SPERANZO (7)

DAWN STOLFI STALENHOEF (20)

CAROL STARKEY

DEBORAH STEENLAND

CATHERINE SULLIVAN

MARKSUTLIFF

JAMES SWEENEY

JOHN TALBOT

ROSEMARY TARANTINO

NEIL TASSEL

DANAH TENCH

LOUISA TERRELL (29)

STEVEN THOMAS

LINDA TOMASELLI

MARINI TORRES BENSON

APPOINTMENTS

BRUCE TRAGER

TRACEY TURNER (22)

THOMAS ULFELDER (24)

TERI WILLIAMS VALENTINE

LINDA WAGNER

TERESA WALSH

PAMELA WECHSLER

PETER WECHSLER

RICHARD WEITZEL

KAREN WELLS (44)

KIMBERLYWEST (51)

JAMES WHITCOMB

DORIS WHITE

JONATHAN WHITE

JUDITH WHITING

BETSY WHITTEY

GEOFFREY WHY

JESSICA COCCOLI WIELGUS (1 1)

JANEWILLOUGHBY

NATHAN AEL WRIGHT

CHARLES WYZANSKI

HERMENYEE

JUDITH YOGMAN

SHEILA YORK (7)

KARLAZARBO

CATHERINE ZIEHL

APPOINTMENTS

APPOINTMENT DATE

TERMINATION DATE

(1)

07/09/01

(2)

07/16/01

(3)

07/30/01

(4)

08/13/01

(5)

08/29/01

(6)

09/02/01

(7)

09/04/01

(8)

09/10/01

(9)

09/17/01

(10)

10/29/01

(11)

11/05/01

(12)

11/13/01

(13)

11/19/01

(14)

12/03/01

(15)

01/02/02

(16)

01/28/02

(17)

02/04/02

(18)

02/28/02

(19)

03/04/02

(20)

03/11/02

(21)

03/25/02

(22)

04/01/02

(23)

04/16/02

(24)

07/02/01

(25)

07/06/01

(26)

07/13/01

(27)

07/20/01

(28)

08/03/01

(29)

08/21/01

(30)

08/24/01

(31)

09/03/01

(32)

09/04/01

(33)

09/10/01

(34)

09/28/01

(35)

10/12/01

(36)

10/19/01

(37)

11/02/01

(38)

11/03/01

(39)

11/09/01

(40)

11/16/01

(41)

11/21/01

(42)

12/19/01

(43)

12/28/01

(44)

01/18/02

(45)

01/25/02

(46)

02/01/02

(47)

02/08/02

(48)

03/08/02

(49)

03/15/02

(50)

03/22/02

(51)

03/29/02

(52)

05/17/02

(53)

05/24/02

(54)

05/31/02

(55)

06/03/02

(56)

06/07/02

(57)

06/14/02

(58)

06/28/02

EXECUTIVE BUREAU

General Counsel's Office

Human Resource Management Office

External Affairs Office

Information Technology Division

Budget Office

Operations Division

Communications Office

EXECUTIVE BUREAU GENERAL COUNSEL'S OFFICE

Executive Bureau

The Executive Bureau's primary function is to provide the Office with overall administration
management, policy setting, staff supervision, and employee training. It is also charged with the
responsibility of administering technical support to over 500 employees located throughout the
Commonwealth. Additionally, the Executive Bureau is responsible for a number of specialized functions,
including the coordination of legislative affairs, constituent relations, community outreach, and all
communications, both internal and external.

The Office of the Attorney General is located in four areas in Massachusetts. The main office is
located in Boston with three regional offices in Springfield, Worcester, and New Bedford. The Executive
Bureau is designed to develop and maintain the agency's infrastructure, enabling all the Offices of the
Attorney General to function productively and effectively for the benefit of the Commonwealth's citizens.

The Executive Bureau consists of the Office of the First Assistant, Attorney General, which oversees
all legal matters and includes the Office of the General Counsel. The Chief of Staff is responsible for
the day-to-day activities of the Attorney General, ensuring that the Attorney General's schedule reflects
his priorities. The Chief of Staff is also responsible for the overall management of the following divisions
— Human Resource Management, Budget, Information Technology, Operations, Support Services,
and the Francis X. Bellotti Law Library.

In Fiscal Year 2002, the Executive Bureau included Dean Richlin, First Assistant Attorney General;
Jeffrey Shapiro, Chief of Staff; Ellen Donaghey; Diane MacDonald; and Pasha Polihronidis.

Smooth operation of the Attorney General's Office is also reliant on the dedicated professionalism
of the following staff members in the Bellotti Law Library and the Telecommunications Division:
KarinThurman, Library Director; Michael Ball; Catherine Douglas; Susan Lindsey; Raymond Manigault;
and Denise McCartin.

GENERAL COUNSELS OFFICE

The name of the Office of the Legal Counsel changed to the General Counsel's Office in Fiscal Year
2002. It is still within the Office of the First Assistant, and the work remains the same. This Office
provides recommendations on legal and policy matters to the Attorney General, the First Assistant
Attorney General, and the Chief of Staff. Staff within the General Counsel's Office also advises all
other staff members, both legal and nonlegal, in the Office of the Attorney General.

EXECUTIVE BUREAU GENERAL COUNSEL'S OFFICE

Specific areas of responsibility within this Office include advising on the Rules of Professional
Conduct and the State Ethics Law; providing legal advice and assistance to the administrative staff
within the Executive Bureau; coordinating the appointments of Special Assistant Attorneys General
(SAAG) ; reviewing and approving legal services contracts for state agencies; reviewing and circulating
petitions and notices from the Board of Bar Overseers; coordinating the officewide review of tax
settlements between the Department of Revenue and individuals who have failed to pay taxes; retaining
and managing the state's OUI notices to drinking establishments; monitoring the National Association
of Attorneys General (N AAG) recommendations and submission of amicus briefs for the First Assistant
and coordinating bureau responses; monitoring and reviewing NAAG's recommendations to join other
Attorneys General throughout the country in letters of support of and/or opposition to proposed
legislation or regulations; representing the Office of Campaign and Political Finance (OCPF) before
the Superior Court; reviewing public records law appeals referred by the Supervisor of Public Records
for enforcement action; and investigating open meeting law violations by state agencies.

Five attorneys staff the General Counsel's Office, each of whom is assigned specific and general
areas of responsibility, with the support of one paralegal and one secretary During Fiscal Year 2002,
the staff in the General Counsel's Office included Pamela M. Dashiell, General Counsel; Deborah
Steenland; Judy Zeprun Kalman, Director of the Attorney General Institute (AG Institute); Eileen
Carey; Akiti Chandler; Christopher Speranzo; and Teri Williams Valentine.

SIGNIFICANT CASE SUMMARIES

The General Counsel's Office manages all internal personnel matters in conjunction with the Human
Resource Management Office. It is responsible for handling workers' compensation claims, union
arbitrations and grievances, discrimination complaints, and disciplinary proceedings up to and including
employee terminations. There were approximately 1 5 active personnel cases involving named individuals
pending in Fiscal Year 2002.

On occasion, the General Counsel's Office will provide assistance to other bureaus with respect to
cases involving litigation. Therefore, some members of the staff carry an active caseload of work unrelated
to the core responsibilities of the General Counsel's Office.

EXECUTIVE BUREAU

GENERAL COUNSEL'S OFFICE

STATISTICAL SUMMARY

Amicus Briefs Received 29

NAAG Sign-on Requests Received 18

Legal Services Contracts Received 101

SAAG Appointments Made 58

SAAG Appointments Vacated 47

Public Records Enforcement Appeals Received 12

Public Records Requests Received 25

Open Meeting Law Complaints Received 3

OCPF Cases Received 17

Board of Bar Overseers/Tax Settlements Received 2 1

OUI Notices Received 2,699

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

Staff of the General Counsel's Office worked with the Human Resource Management Office to
conduct training on the Attorney General's Anti-Discrimination and Sexual Harassment Policy. Members
of the General Counsel's staff were involved in other cross-bureau initiatives, including the Children's
Protection Project, the Employee Benefits Committee, officewide orientation, and the creation of a
training module on the unauthorized practice of law for the Attorney General's hotline operators. A
staff member also started drafting an officewide Policies and Procedure Manual.

The Professional Development Unit, established within the General Counsel's Office in Fiscal Year
2001 , was renamed the Attorney General's Institute in Fiscal Year 2002. In keeping with the Attorney
General's priority of ensuring that staff has access to the latest information and training available, the
AG Institute provides continuing education to legal and nonlegal staff on a variety of topics. The

EXECUTIVE BUREAU HUMAN RESOURCE MANAGEMENT OFFICE

programs of the AG Institute are open to all employees within the Office of the Attorney General.
During Fiscal Year 2002, the AG Institute offered 28 programs and brought in 1 2 Distinguished Lecturers.

OUTREACH, EDUCATION, AND TRAINING

The staff of the General Counsel's Office provided training to state and local government agencies
on open meeting law issues and public records law matters. During Fiscal Year 2002, staff members also
served as panelists and speakers at NAAG seminars, Massachusetts Continuing Legal Education forums,
and various legal programs offered across the country sponsored by the American, Boston, and
Massachusetts Bar Associations.

HUMAN RESOURCE MANAGEMENT OFFICE

The Human Resource Management Office is responsible for the recruitment and hiring of employees,
benefits administration, performance appraisals, time and attendance record-keeping and officewide
trainings. During Fiscal Year 2002, staff members included Diana LaRochelle, Director; Luna Bacon;
James Chu; Joyce Delgardo; Thomas Kopaczynski; Sandra Macdonald; Rosemary Miller; Meade Munroe;
Joseph Shea; Marie Urciuoli; and Christine Wilson.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

Antl-Dlscrlmlnation and Sexual Harassment Policy Training The Office reissued the Anti-
Discrimination and Sexual Harassment Policy in April 2002. After completing the task of
training all members of the management and supervisory staff, the Office focused its attention
on training each staff member in this important policy. During Fiscal Year 2002, 220 employees
successfully completed this training. The Office remains committed to holding trainings on a
regular basis so that all employees may appreciate the goal of having a workplace that is inclusive
and diverse.

Officewide Orientation Program In conjunction with the Human Resource Management
staff and the AG Institute, the First Assistant Attorney General and other senior managers
developed for the first time an enhanced office-wide orientation program for new employees.
This program was designed to introduce new staff to the structure and organization of the
Office, and various policies and procedures that facilitated access to the Office's resources and

EXECUTIVE BUREAU HUMAN RESOURCE MANAGEMENT OFFICE

programs. Additionally, new employees had the opportunity to meet their colleagues from
different bureaus and areas of operation, and learn more about the Office s mission and priorities.
During Fiscal Year 2002, over 50 newly hired employees were invited and participated in this
program.

Office-Sponsored Bar Association Memberships In addition to sponsoring membership with
the Massachusetts and Boston Bar Associations, the Attorney General's Office's attorneys were
again offered the opportunity to join one of the many minority and women's bar associations in
the local or regional areas. This benefit was carried over from the previous year to further the
Office's commitment to meeting the needs of attorneys' professional development and to
encourage involvement with organizations made up of diverse members and experience.

Enhanced Payroll System All Human Resource Management and Payroll staff were trained in
the Internet-based 8.0 release of the HR/CMS payroll system. During Fiscal Year 2002, the
supervision of time and attendance was transitioned from HRM to the Payroll Coordinator in
the Budget Office.

Fellowship Program Three fellows were hired in September 2001, based upon an application
and interview process begun and completed in Fiscal Year 2002. Due to financial considerations,
a decision was made to suspend the program for Fiscal Year 2003.

Le gal and Student Intern Program The Attorney General's Office welcomed a total of 64
students for the 2001 Summer Intern Program: 25 students from six Massachusetts law schools
and four out-of-state law schools; and 48 undergraduate students from over 33 colleges and
universities across the country. The law students are afforded a unique opportunity to participate
in a full-time, structured nine-week summer program which is unfunded, aimed at both utilizing
the knowledge of the law students and giving them hands-on experience and training in the
areas of law in the Commonwealth for which the Attorney General's Office is responsible.

Student interns volunteer at least 1 5 hours per week and are assigned in all seven bureaus across
the Office. The term of their internships varies from student to student but often exceeds nine
weeks.

Over the course of the fiscal year, the Office benefited greatly from the dedicated services of
over 85 legal interns and 100 student interns. Additionally, the Assistant Attorneys General in
the Office run clinical programs for students at three area law schools — Harvard Law School,
Boston College Law School, and New England School of Law — throughout the year.

EXECUTIVE BUREAU EXTERNAL AFFAIRS OFFICE

The Attorney General's Office actively participates annually in the Massachusetts Law School
Consortium interview process to recruit summer legal interns. In addition to this valuable
source of candidates, the Office coordinates and holds over a hundred interviews in late winter
with students from numerous law schools for placement in the summer program.

Personnel Activity During Fiscal Year 2002, the Attorney General's Office hired 35 attorneys
and 44 non-legal staff, for a total of 79. There were 103 employees who separated from the
Office.

The Commonwealth offered an Early Retirement Incentive Program (E.R.I. P.) effective March
15, 2002 as a means to allow agencies to reduce staff sizes voluntarily. There were a total of 2 1
employees in the Office of the Attorney General who took advantage of the program.

Anticipating a funding reduction in its Fiscal Year 2003 budget, the Attorney General's Office
was forced to take the unfortunate action of laying off 1 1 employees effective July 5, 2002.

EXTERNAL AFFAIRS OFFICE

The External Affairs Office of the Executive Bureau is responsive to the public and the legislature.
Its function is to serve as a liaison between the community, the legislature, and the Attorney General.
External Affairs consists of the Office of Community Partnerships, Intergovernmental Affairs,
Correspondence, and the Community Liaison.

The External Affairs Office included the following staff members: Jason Queenin, Director; Leah
Green; Laura Marlin; Sally Ogine-Noel; Peter Russell; and Lyndsay Wolf.

OFFICE OF COMMUNITY PARTNERSHIPS

Attorney General Reilly created the Office of Community Partnerships to work with Massachusetts'
mayors, other urban leaders, and local town officials to address issues that relate to our cities and towns,
particularly as they affect the health and safety of our children, environmental concerns, and housing
issues. This Office acts as a direct liaison between the Attorney General's Office and the state's cities and
towns.

In April 2001, the Office of Community Partnerships worked with the Massachusetts Municipal
Association and the Massachusetts City Solicitors and Town Counsel Association in presenting the

EXECUTIVE BUREAU INFORMATION TECHNOLOGY DIVISION

Municipal Law Forum (previously mentioned in the Attorney General's priority list) . This conference
provided local leaders and town officials with a comprehensive update on relevant federal and state
legislation, court cases, regulatory matters, and administrative decisions, as well as offered a unique
opportunity to gather information, share perspectives, and raise important concerns and questions
affecting Massachusetts' cities and towns.

INTERGOVERNMENTAL AFFAIRS

The Intergovernmental Affairs Office acts as the liaison to other state and federal government
offices and officials, including the state legislature and members of the Massachusetts congressional
delegation. Intergovernmental Affairs works with other bureaus to develop and file legislative proposals,
and monitors legislation and budget items relevant to the Office of the Attorney General.

In Fiscal Year 2002, on behalf of the Office, the Intergovernmental Affairs Office drafted legislation
and worked to update the Commonwealth's laws to provide greater protections for children, keep pace
with technological changes in law enforcement, and protect elders from abuse and neglect. Also,
shortly after the terrible events of September 1 1th, Attorney General Reilly and the Intergovernmental
Affairs Office worked closely with the legislature to enact laws to ensure that the Commonwealth is
prepared to combat acts of domestic terrorism if necessary.

Additionally, the Intergovernmental Affairs Office acts as the contact for members of the legislature
and staff who have questions or need assistance from the Attorney General's Office on behalf of their
constituents. In Fiscal Year 2002, the office handled hundreds of calls and written inquiries from
members of the state legislature and congressional delegation pertaining to a wide range of matters.

COMMUNITY LIAISON

The Community Liaison is responsible for constituent services. The position was created as a resource
for telephone requests or walk-ins from the community to obtain information for either internal or
external assistance. In Fiscal Year 2002, approximately 2,700 telephone requests were fielded and resolved.

INFORMATION TECHNOLOGY DIVISION

The Information Technology Division (ITD) is responsible for the operation and maintenance of
the Office of the Attorney General's computer network and related technical resources. The division
maintains a wide area network (WAN) at One Ashburton Place, which provides connectivity from the

EXECUTIVE BUREAU INFORMATION TECHNOLOGY DIVISION

main office in Boston to the local area networks (LANs) that support staff located at 200 Portland
Street, Boston; Springfield; Worcester; and New Bedford.

The mission of ITD is to provide hardware, software, and end-user assistance for all Office staff in
all locations. The division's staff supports 1 7 servers, five routers, network communications equipment,
and over 600 computer devices, including desktop PCs, notebook PCs, printers, scanners, and other
peripheral equipment. During Fiscal Year 2002, ITD staff included Paula Durant, Director; Claudette
Clement; Bruce Crosby; Jean Exantus; Christine Heneghan; Jack Ngan; Ronald Rossetti; Visakha
Samaraweera; Thomas Smith; and Lisa Sullivan.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

The Attorney General's Office remains committed to maintaining the quality of its technical
resources. Realizing the importance of keeping pace with current technology, the division focused on
replacing obsolete servers and server operating systems, replacing all outdated Windows NT platforms
with Windows 2000, and then beginning the Office's mail system migration to Notes R5. Once that
was well under way, all Novell file servers were upgraded to Netware 6. Each of these projects resulted
in significant operating system efficiency, and Office staff are now able to take advantage of a number
of messaging enhancements.

To address the continued demand for multi-media and presentation technology, the Office acquired
presentation equipment and mobile computing equipment for each satellite location and procured
licenses for litigation support software packages.

In Fiscal Year 2002, ITD also assisted in moving the Springfield Office to new office space, taking
advantage of the opportunity to install updated cabling and network communications equipment.
Desktop and printer upgrades continue but, thanks to previous efforts, on a much smaller scale.

In conjunction with the officewide improvements, ITD also responded to the needs of particular
divisions. ITD developed and implemented a digital document storage solution for the Municipal Law
Unit, utilizing the same equipment and software implemented last year for the Public Charities Division.
The division also worked with members of the Victim Compensation and Assistance Division to install
and implement equipment and applications software for their new claims tracking system and assisted
the Environmental Protection Division with their implementation of a GIS system.

EXECUTIVE BUREAU BUDGET OFFICE

OUTREACH, EDUCATION, AND TRAINING

The Information Technology Division provides end-user assistance both in scheduled sessions and
upon request. Two help desks are maintained for user convenience, one at Ashburton Place and one at
200 Portland Street. User calls are received by the help desks for all types of issues. Reported hardware
problems are referred to the next available Technical Support Specialist, and those requiring a particular
expertise are directed to the ITD staff member best qualified to assist. In addition, orientation sessions
are held for new employees and interns upon start of work.

Throughout the past year, ITD issued a variety of policy reminders, virus alerts, and technical
bulletins to Office staff via e-mail. ITD staff also participated in the AG Institute's training seminars,
presenting topics such as directory organization, e-mail etiquette, and WordPerfect tips.

BUDGET OFFICE

The Budget Office included the following staff members: Frank Velluto, Director; James Creedon;
Kerisotellia Ford; Mary Jane Grace; Jennifer Hanly; Kristine Hill; Penny Michalski; Gail Sarno; and
Lynette Smith. Support Services staff included William Coughlin, Manager; Stephen Cress; Timothy
LeBlanc; Pier Minghetti; Nestor Morales, Jr.; David Scafati; and Harold Tafler.

The challenge to the Budget Office in Fiscal Year 2002 was to provide for the increasing needs of
the Office while anticipating that Fiscal Year 2003 funding would be reduced due to the ongoing state
budget crisis.

To meet these demands, during the second part of the fiscal year, the Budget Office recommended
that most positions vacated through regular attrition and retirements associated with the Commonwealth's
Early Retirement Incentive Program not be filled. Unfortunately, further reductions were necessitated
by anticipated Fiscal Year 2003 cuts, and at the end of the year, the Office further reduced staffing
through 1 1 layoffs. Although difficult, these decisions allowed the Office to absorb an almost 5%
reduction in its main appropriation in the following year without further reductions.

Even with diminished resources, the Budget Office worked to fund costs associated with a number
of high-profile cases and various cost-share agreements.

Additionally in Fiscal Year 2002, the Budget Office worked with staff from the Insurance Fraud
Division to establish a new inter-governmental service agreement with the Social Security Administration

EXECUTIVE BUREAU OPERATIONS DIVISION

(SSA), administered through the Massachusetts Rehabilitation Commission. With funding provided
by SSA, the Office hired two investigators to combat disability fraud and to ensure that disability
benefits are awarded only to deserving individuals. To allow the project to go forward, the Budget
Office worked with the State Comptroller's Office to arrive at a lower indirect cost rate.

In Fiscal Year 2002, the management and supervision of the time and attendance function was
moved from the Human Resource Management (HRM) Office to the Budget Office. This change
resulted in a streamlining of business processes to simplify the reporting procedure while also significantly
reducing the wasteful use of paper. This has resulted in a more accurate reporting of employees' time
and greater productivity for both Budget and HRM staff.

During Fiscal Year 2002, Budget staff processed over 12,000 payment voucher (PV) documents
totaling $18,456,943.

Among these totals were 2,427 PVs totaling $621,331 that were issued to claimants who benefited
from settlements made with various retailers and over 1 million in recovered wages.

OPERATIONS DIVISION

The Operations Division is made up of staff members who are responsible for providing ancillary
support to a multitude of initiatives and functions of the Office of the Attorney General. While
working to support these functions during Fiscal Year 2002, the Operations Division enhanced the
Office's security measures and emergency response capabilities in all five central and regional locations,
conducting unannounced visits to ensure compliance.

In Fiscal Year 2002, the division's staff was composed of Gene Ring, Director; Chris Adams; and
Kevin Nolan.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

In Fiscal Year 2002, the Operations Division completed a significant project that began in mid-
Fiscal Year 2001 . One of the Attorney General's priorities has been to upgrade the working environment
in an effort to create a safer and more professional physical plant. Upgrading the Western Massachusetts
Office was critical to that mission. The Operations Division developed a Request for Proposal for new
space in which to move the western region staff. Working in conjunction with the Department of

EXECUTIVE BUREAU OPERATIONS DIVISION

Capital Asset Management, and under the direction of Gene Ring, the Attorney General's Office
secured new space in a modern downtown Springfield building. This new space was built out to
accommodate needs of a modern working environment and in a manner consistent with both staff
safety and comfort. The Western Massachusetts Office is now among the best offices in the
Commonwealth's inventory.

In the aftermath of September 1 1th, the Operations Division played a key role in upgrading and
developing the Attorney General's Emergency Response Team. Operations reviewed previous plans,
upgraded and modernized these plans, and reassigned personnel to critical duties according to lessons
learned that fateful September. Among the many changes initiated were the establishment of emergency
backpacks, strategically located throughout all offices. These backpacks contain supplies necessary in
an emergency, along with emergency contact numbers and communication information. Operations
secured access to several off-site backup operations centers so the Attorney General can conduct the
Commonwealth's legal business during any emergency. Operations staff were also, on several occasions,
first responders to suspected anthrax letters and established a protocol for safely dismantling potentially
dangerous situations, while maintaining a smooth, uninterrupted operation of office functions.

With resources shrinking and the cost of doing business increasing, Operations continues to play a
critical role in developing alternative methods of providing ancillary services to office staff. To this end,
the Operations Division has examined current practices, identified ways in which to shave costs, and
implemented common-sense measures. For example, equipment in need of repair and/or upgrading
has been restored to good working order when it was determined to be more cost-effective than purchasing
new. Another cost-saving measure was the creation of the Multi-Media Laboratory, which has proved
a critical resource to the Office as well. The Multi-Media Lab has taken on the job of redeveloping trial
exhibits on a larger scale, thus reducing the cost of reproduction to outside vendors. With only a
moderate retooling of its technological needs, the Lab has advanced the Office's capacity to convince
juries, consistently portray the Attorney General in the best possible manner, professionally enhance
audio and video surveillance records, and develop high-quality visual aids for trials, press conferences,
and special events. The Multi-Media Laboratory also has produced several local cable access shows in
an effort to raise public awareness of services offered by the Attorney General's Office.

The Operations Division has completely revised the Office's equipment inventory methodology
and adjusted asset reporting to bring staff up-to-date with the Comptroller's new reporting requirements.
This has led to two independent auditors finding the Office of the Attorney General in compliance
with state regulations.

Operations also coordinated the archiving of closed case files and the recalling of files from both
the State Records Center and private vendors. This task involved training and oversight of all bureau

EXECUTIVE BUREAU COMMUNICATIONS OFFICE

and division personnel involved in the maintenance of records, as well as the acquisition and distribution
of record maintenance materials to all central and regional sites.

Other functions within the scope of Operations include vehicle maintenance, staff parking,
acquisition and maintenance of emergency remote communication devices, responding to facility alarms,
and general physical plant upkeep.

COMMUNICATIONS OFFICE

The Communications Office coordinates all media-related matters for the Attorney General's
Office. The chief responsibility of the Communications Office is to serve as a centralized public voice
for the agency. To that end, the Communications Officers work with executive staff and Bureau Chiefs
to ensure that the Attorney General's priorities are reflected in all public statements and materials,
including press releases, advisories, public statements, interviews, publications, the Attorney General's
Web site (www.ago.state.ma.us) , and other public appearances and events.

Addressing the needs both to improve communication within the agency and to establish protocols
for communicating with the public, the Communications Office has implemented policies designed
for dealing with the media, creating publications and brochures, and placing information on the Attorney
General's Web site.

The Communications Office included Stephen Bilafer, Director; Marsha Cohen; Ann Donlan;
Krista Genest; Sarah Nathan; Beth Stone; and Elissa Torto.

WEB SITE

In existence since December 1999, the Office Web site continued to expand during Fiscal Year
2002. After more than a year in the redesign stages, the Office launched the revised Web site design in
May 2002, thus allowing better visibility, ease of navigation, and compliance with accessibility guidelines.
With the new design, the size of the site increased to nearly 5,000 pages and documents with
approximately 60,000 visitors per month. Various areas of consumer protection, workplace rights,
charities, environmental, and governmental issues were added to the site during the redesign as well as
updated information for all other sections. In addition, current publications continued to be added to
the Web site in PDF and, if possible, HTML formats (for accessibility compliance). This allowed the
Office to cut down on printing and mailing costs, as many constituents were able to access publications

EXECUTIVE BUREAU COMMUNICATIONS OFFICE

from their home computers. All press releases that are disseminated from this Office are now accessible
on the site, as well as customized directions to all office locations, hotline numbers, and up-to-date
information on employment opportunities and policies.

During Fiscal Year 2002, the Community Benefits Web Project was undertaken by the Office in an
effort to improve the Community Benefits services already provided online to the citizens of the
Commonwealth. The project included facilitating the electronic filing of annual reports, promoting
public access to hospital and HMO Community Benefit Annual Reports, and providing tools to find
and analyze these reports. The launch date of this project is expected in Fiscal Year 2003.

BUSINESS AND LABOR
PROTECTION BUREAU

Fair Labor and Business Practices Division

Insurance and Unemployment Fraud Division

Medicaid Fraud Control Unit

BUSINESS AND LABOR PROTECTION BUREAU FAIR LABOR AND BUSINESS PRACTICES DIVISION

Business and Labor Protection Bureau

The Business and Labor Protection Bureau, a bureau comprising approximately 100 lawyers,
investigators, and administrative staff, maintaining responsibility for policing and prosecuting a variety
of business crimes and related civil wrongs. The bureau consists of the Fair Labor and Business Practices
Division, the Insurance and Unemployment Fraud Division, and the Medicaid Fraud Control Unit. The
bureau's mission is to use its enforcement responsibility and public education initiatives to prosecute and
deter fraud in the marketplace and to create a fair environment in which businesses and workers can
participate.

The bureau's primary offices continue to be located at 200 Portland Street, Boston. The bureau is
also represented in the Attorney General's regional offices in Springfield, Worcester, and New Bedford as
well as its part-time satellite locations in Fall River and Pittsfield. Staff also regularly maintains office
hours in Lawrence.

In Fiscal Year 2002, the bureau staff was made up of David Nalven, Bureau Chief; Jill Markowitz;
David Marks; Connie McGrane; and Vicky Scolnick.

FAIR LABOR AND BUSINESS PRACTICES DIVISION

The Fair Labor and Business Practices Division (FLBP) is responsible for enforcing many of the
Commonwealth's statutes and regulations concerning conduct in the workplace. As Fiscal Year 2002
witnessed a decline in the national and regional economies, and brought to the fore many business
problems arising from a failure of corporate responsibility, the demands placed on FLBP increased
dramatically. FLBP, through its telephone hotline, served as a workplace-law information center for
both workers and businesses. FLBP investigators investigated tens of thousands of formal and informal
complaints received through this hotline. Most of the problems raised in these complaints were resolved
following FLBP inquiry, but many others required FLBP staff to pursue resolution through administrative,
civil, and criminal processes.

Fair Labor and Business Practices is charged with enforcing the Massachusetts wage and hour laws,
including the prevailing wage, minimum wage, nonpayment of wages, and overtime laws. FLBP is also
charged with enforcing child labor laws. In addition, FLBP maintains responsibility for enforcement of
laws concerning adherence to public contracting requirements. FLBP is also responsible for reviewing
and ruling on applications by businesses for waivers from compliance with certain workplace laws.

BUSINESS AND LABOR PROTECTION BUREAU FAIR LABOR AND BUSINESS PRACTICES DIVISION

During Fiscal Year 2002, FLBP staff included Dan Field, Division Chief; John Baker; Jeb Banks;
Phil Beattie; Randy Berg; Bruce Bergman; Patricia Bopp; Jenifer Bosco; Cecile Byrne; Ronald Cabezas;
Jay Clark; Mary Connolly; Susan Decker; Joseph Drzyzga; Mary Dullinger; Patrick Faherty; Robert
Galvani; John Gatti; Lory Goldenberg-Tarrow; Paul Gordon; Michael Guarin; Richard Hartigan; Marsha
Hunter; Jocelyn Jones; Barbara Kane; Patricia Kelleher; Noreen Kelly; Katharine Klubock; Robert Lamarre;
Carolyn Long; Brian Macera; Jeffrey Mahoney; Anita Maietta; Mildred Markham; Katherine Mulligan;
Mario Paiva; Joan Parker; Iona Powell-Headley; Anne Powers; Greg Reutlinger; Mario Rosado; Elizabeth
Rufo; Jennifer Ryan; Palmer Santucci; Steven Spencer; Bruce Trager; Steve Troiano; Theresa Ukleja;
Theresa Vadala; Richard Yorra; and Karla Zarbo.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

OVERALL INVESTIGATORY ACTIVITY

Fair Labor and Business Practices received and investigated in excess of 4,300 formal complaints in
Fiscal Year 2002. In many instances, FLBP's investigators recovered payment of full restitution or were
provided with another appropriate remedy to the aggrieved employee without initiating the civil citation
process or litigation. In many other cases, consistent with its law enforcement mission and approach,
FLBP's staff employed its prosecution authority to pursue instances of unlawful conduct and regularly
sought civil and criminal sanctions to be imposed on workplace-law offenders. Through these efforts, in
the last fiscal year, FLBP recovered in excess of $2.8 million in wages that were owed, but unpaid, to
Massachusetts workers, as well as administrative and criminal penalties and costs.

PREVAILING WAGE ENFORCEMENT

Fair Labor and Business Practices places a high priority on enforcement of the prevailing wage law.
Well-documented complaints often form the basis for FLBP's most effective prosecutions and wage
recoveries. FLBP inspectors also conduct unannounced site inspections at numerous public construction
projects. During Fiscal Year 2002, FLBP investigators conducted over 120 public construction site
inspections throughout the Commonwealth. This proactive approach not only assisted in the discovery
of unlawful conduct, but also served the important public purpose of deterring workplace misconduct.

BUSINESS AND LABOR PROTECTION BUREAU FAIR LABOR AND BUSINESS PRACTICES DIVISION

The following provides a representative sampling of prevailing wage cases undertaken by FLBP
during Fiscal Year 2002:

• Waste Management In Fiscal Year 2002, Waste Management entered into Phase III of a
multi-year settlement agreement in which it agreed to pay $480,000 to approximately 1,400
temporary workers who performed work for the company. Failing to adhere to the requirements
of the Massachusetts prevailing wage law, from 1998 to 2001, Waste Management of
Massachusetts underpaid thousands of workers who served as trash haulers in approximately 60
cities and towns throughout the Commonwealth.

• Allied/BFI Trash haulers failed to pay prevailing wage to employees and temporary workers.
$475,000 settlement of temporary worker prevailing wage claims.

• Diversified Contractors Appeals Court rejected challenge to the constitutionality of the
regulatory framework under which the Commonwealth establishes job classifications and upheld
conviction against contractor who misclassified tradesmen in order to minimize wage payment
obligation.

• Tinker Electrical Electrical contractor company failed to pay prevailing wage to apprentices
on numerous public works jobs. Settlement of $52,000 in restitution plus three-month
debarment.

• Midland Fire Protection Settlement of prevailing wage claims involving multiple employees
at five Central Massachusetts school projects. $42,000 in restitution and penalty.

• Ebacher Plumbing & Heating Two sprinkler fitters were not paid the prevailing wage rate
on several public works jobs. Settlement of $41 ,000 restitution and a $2,500 penalty.

• Kneeland Plumbing and Heating Plumbing and heating contractor failed to pay prevailing
wage to apprentices on six public works jobs from 1997 to 1999. Settlement of $36,000 in
restitution, plus agreement not to bid on or perform public works jobs for five months.

• Ferriera Construction Settlement of civil citations for prevailing wage violations in Rehoboth.
$15,000 restitution and penalty imposed.

BUSINESS AND LABOR PROTECTION BUREAU FAIR LABOR AND BUSINESS PRACTICES DIVISIO N

PAYMENT OF WAGES ENFORCEMENT

Fair Labor and Business Practices is authorized to issue civil citations for violations of the wage and
hour laws. A civil citation issued by FLBP can require the employer to comply with the law, pay
restitution to the employees, and pay a civil penalty FLBP has issued such citations to employers who
fail to pay wages, overtime, the minimum wage, or prevailing wages, or who fail to provide certified
payroll or other employment records required to be maintained and produced under Massachusetts law.
Under the law, during Fiscal Year 2002, FLBP issued 186 civil citations for violations of the payment of
wages and prevailing wage statutes.

The following provides a representative sampling of unpaid wage cases undertaken by FLBP during
Fiscal Year 2002:

• Electronic Data Systems Superior Court decision affirming DALA decision upholding
citation for failure to pay earned vacation wages to departing employee. The decision was also
significant because it expressly recognized that the Attorney General's Office was entitled to
deference in its interpretation of payment of wages statutes.

• Commonwealth v. Richard |acobson Defendant defrauded customers/clients of the value
of their antiques and other property, and failed to pay wages to an employee. Total fraud of
$78,000. Following Jacobson's guilty plea, he was sentenced to two and one half years probation
and ordered to pay full restitution.

• Ocean Edge Resort Company took illegal housing deduction from more than sixty Jamaican
immigrant staff. Setdement for $10,000 in restitution, $ 1 ,500 donation to Cape Cod immigrant
support organization, and compliance going forward.

• Bilafer Landscaping Seven Brazilian immigrants were not paid for work performed. Bilafer
was sentenced to six months in the House of Correction, suspended, and ordered to pay fines and
restitution. He was also debarred from participating in state and municipal contracts for three

• Dlrigo Energy. Inc. Failure to pay almost $59,000 in wages to two engineering and
maintenance employees. Settlement resulted in payment to the affected employees and an
admission to a non-willful first civil offense.

• Fishbones/Paul Masachi Affirmance of civil citation imposed upon Plymouth restaurant
charging non-payment of wages to numerous employees. $ 1 5,000 restitution and penalty imposed.

BUSINESS AND LABOR PROTECTION BUREAU FAIR LABOR AND BUSINESS PRACTICES DIVISION

• Orient Express/Ienny Woo The twice-convicted president of a Medford restaurant was
cited for failure to pay wages to two chefs, both Chinese immigrants. Obtained restitution and
penalty order.

• Ring Nursing Home Employees docked pay for one- to five-minute late punch-ins on time
clock, resulting in unpaid wages of approximately $3,800. Settlement resulted in restitution to
300 employees and an end to the practice of docking.

PUBLIC CONTRACTS OVERSIGHT

The Attorney General's Office continued to provide a professional and accessible forum for the
resolution of public construction bidding disputes, including investigating allegations of impropriety in
connection with public works project bidding. The Attorney General's primary enforcement efforts in
this area have been undertaken by FLBP's Public Contracts Unit. The tools employed by the Public
Contracts Unit include adjudication of disputes, informal advice, and public education. In Fiscal Year
2002, the unit issued written decisions in 37 cases.

The unit also provided informal advice by telephone to the Commonwealth's awarding authorities
and contractors who bid on public works projects. During Fiscal Year 2002, the Public Contracts Unit
received thousands of written and telephone inquiries. The unit's telephone support has become an
established resource for contractors and awarding authorities. Telephone assistance also has served as a
significant prevention tool, often delivering the information necessary to prevent (or quickly remedy) a
violation of the public bidding laws.

Fair Labor and Business Practices' public contracts enforcement efforts also included an educational
component that provided public contracting participants with information regarding the public bidding
laws. Among other things, the Attorney General's Office distributed the written public contracts bid
protest decisions to the public construction community. In addition, FLBP's staff participated in
educational programs that provided to the construction industry and their counsel the substantive and
procedural information necessary to properly solicit or submit public works construction bids. Such
proactive efforts have served many useful purposes, not the least of which has been to decrease the
number of bid protests.

Following are two examples of significant public contract disputes resolved by FLBP in Fiscal Year
2002:

BUSINESS AND LABOR PROTECTION BUREAU FAIR LABOR AND BUSINESS PRACTICES DIVISION

• Holyoke Charter School Decision issued requiring charter school to comply with public
construction bidding laws, despite private nature of awarding entity, on grounds that the real
parties in interest were public, the purpose was public, and funding was public.

• Waltham School Case Bid protest decision interpreting new legislation concerning
relationship between general contractors and subcontractors. Decision upheld in challenge brought
by disappointed contractor.

CHILD LABOR

The Massachusetts child labor laws were established to protect workers under the age of 18. These
workplace laws implicitly recognize the special vulnerabilities of young workers. The laws have allowed
young workers to optimize their educational opportunities by restricting the number of hours minors of
certain ages may work. In recognition of the increased rate of workplace injury among teenage workers,
these laws also have helped shield minors from working on hazardous tasks and equipment. In addition,
the permitting process, in which FLBP's specially trained child labor inspectors are closely involved, has
created a structure for school superintendents, who issue work permits, to review the intended employment
to ensure that it is safe, is consistent with the child labor laws, and serves the best interests of the minor.

During Fiscal Year 2002, FLBP inspectors investigated reports of child labor violations and conducted
workplace site inspections, visiting many businesses where minors were employed, noting violations, and
advising employers of their responsibilities and legal obligations under the child labor laws.

WAIVERS AND INDUSTRIAL HOMEWORK

Fair Labor and Business Practices is charged by statute with the authority to waive certain requirements
of the labor laws under certain conditions. During Fiscal Year 2002, FLBP processed hundreds of waiver
applications and industrial homework certificate requests. Each request for a waiver was carefully evaluated
before a determination was made to grant or deny the request. FLBP enforced the industrial homework
laws (work performed for a company in the employee's home) by issuing permits to the employers and
certificates for each employee, where applicable. FLBP also monitored these companies to ensure
compliance with the minimum wage and overtime laws.

BUSINESS AND LABOR PROTECTION BUREAU FAIR LABOR AND BUSINESS PRACTICES DIVISION

STATISTICAL SUMMARY

Restitution Recovered $2,853,849

Hotline Calls 74,934

Formal Complaints Filed 4,321

Cases Closed 5,314

Civil Citations Issued 186

Public Contract Dispute Decisions 37

OUTREACH, EDUCATION, AND TRAINING

Attorney General Reilly has long believed that public education is the first step in promoting compliance
with workplace law. Accordingly, outreach to the employee and employer communities, and their unions,
trade associations, counsel, and other advocates, has been an FLBP priority. One means to this end has
been FLBP's telephone hotline, which has served as a workplace law information center for workers and
businesses. In Fiscal Year 2002, the FLBP hotline received almost 75,000 inquiries.

The Immigrant Worker Outreach Project , launched in the prior fiscal year, continued to make headway.
The Attorney General has long touted his support for fair treatment of immigrants in the workplace; this
project is one way to help ensure that all workers in the Commonwealth receive an honest day's wages for
an honest day's work. To that end, FLBP continued to pursue immigrant worker exploitation cases with
vigor and expanded its translation efforts. In the past year, FLBP made over 1 00 presentations to immigrant
advocacy groups and their constituents. The project continued to receive specific complaints of workplace
abuse. The program also began to make presentations to employer groups in an effort to educate that
group regarding their rights and responsibilities concerning immigrant employees.

Outreach was conducted in other areas as well. During Fiscal Year 2002, FLBP staff made more than
70 presentations to bar association and continuing legal education groups, professional organizations,
trade associations, labor unions, and employee advocacy groups. These presentations ranged from nuts-
and-bolts primers on the Commonwealth's wage and hour laws, and employee and employer rights and

BUSINESS AND LABOR PROTECTION BUREAU INSURANCE AND UNEMPLOYMENT FRAUD DIVISION

responsibilities under these laws, to sophisticated presentations on such topics as worker classification
under the prevailing wage law and the treatment of accrued vacation time as wages.

Fair Labor and Business Practices has also sought to educate relevant communities about wage and
hour issues through the production and distribution of advisories and other publications, including a
minimum wage and workplace rights poster designed by FLBP. FLBP also worked with the
Commonwealth's Division of Occupational Safety on the compilation and distribution of a Compendium
of Massachusetts Prevailing Wage Law, for use by awarding authorities, contractors, workers, and other
participants in Massachusetts public works construction projects.

Fair Labor and Business Practices has endeavored, in the past year, to convey information to the
community through the Workers' Rights section of the Attorney General's Web site. The FLBP portion
of the Web site was established to contain basic summaries of Massachusetts workplace law, many of the
AGO's workplace-related advisories and publications, and other resources. The Web site was accessed by
callers to the hotline as well as the general public, thus achieving its goal of serving as another means of
providing information to the people of the Commonwealth.

INSURANCE AND UNEMPLOYMENT FRAUD DIVISION

The mission of the Insurance and Unemployment Fraud Division (IUFD) is to investigate and
prosecute fraud against all types of insurers in Massachusetts, and against the Commonwealth's
unemployment security system. IUFD prosecutes these crimes to protect Massachusetts businesses,
consumers, and taxpayers from the hidden tax that fraud on these systems imposes.

IUFD's cases varied widely, including multi-million-dollar workers' compensation premium fraud
cases, conspiracies by medical and legal professionals, fraud in auto repair businesses, staged motor vehicle
accidents, inflated claims against homeowner's policies, cases involving claimants working while collecting
workers' compensation benefits, and fraud by businesses on the Commonwealth's unemployment security
fund. IUFD gave special attention to policing fraud by insurance industry insiders, including insurance
agents, claims adjusters, and damage appraisers, whose frauds could have had an especially corrosive effect
on public confidence in the insurance and unemployment compensation systems.

IUFD has received referrals from a number of sources. The largest source of referred cases was the
Massachusetts Insurance Fraud Bureau, a non-governmental entity created by the Massachusetts Legislature
and funded pursuant to statute indirectly by the Massachusetts insurance industry. In addition, IUFD
received referrals from the Commonwealth's Human Resources Division, the Governor's Auto Theft

BUSINESS AND LABOR PROTECTION BUREAU INSURANCE AND UNEMPLOYMENT FRAUD DIVISION

Strike Force, the Department of Industrial Accidents, the Workers' Compensation Rating and Inspection
Bureau, the National Insurance Crime Bureau, and the Social Security Administration. IUFD also
received complaints and referrals from concerned citizens, private attorneys, and court personnel. The
wide range of referrals helped exemplify that IUFD's efforts in fighting insurance fraud are appreciated
throughout the Commonwealth.

IUFD included the following staff members during Fiscal Year 2002: Eliot Green, Division Chief;
Dave Andrews; Martha Bower; Jack Crimmins; John Curseaden; Marty Flood; Rafael Garcia; Julie
Goodwin; Hannah Greenwald; John Hanrahan; Madeline Leone; Gloria Luk; Tim Malec; Michael
McNally; Amy Nechtem; Shauna Neuhauser; John O'Leary; Lena Robinson; and John Talbot.

SIGNIFICANT CASE SUMMARIES

The following are representative cases that were concluded in Fiscal Year 2002:

FRAUD BY PROFESSIONALS

• Michael Bryant Conviction after five-week trial of former Ellis & Ellis associate charged
with conspiracy to commit motor vehicle insurance fraud in connection with submission of false
claims by his client, Jay Rosenfield, in 1994. Sentenced to two and one half years in the House
of Correction, 12 months to serve. Service of the sentence was stayed, pending appeal. The
defendant was subsequently temporarily suspended from the practice of law upon application of
the Board of Bar Overseers.

• Andrew Budz Dentist submitted phony claim for equipment damage. The case was continued
without a finding, and the defendant was ordered to pay full restitution and $3,000 court costs.

FRAUD BY INSIDERS

• Armand Arce Insurance agent who embezzled client funds by failing to apply proceeds of
cashed-in policies to purchase of new policy, as promised, pleaded guilty and was sentenced to 60
days in the House of Correction, suspended for two years, and ordered to pay $5,55 1 in restitution.

BUSINESS AND LABOR PROTECTION BUREAU INSURANCE AND UNEMPLOYMENT FRAUD DIVISION

• lohn McKay Braintree insurance agent sold bogus policies to 70 personal chefs, resulting in
fraud of more than $35,000. Guilty plea on day of trial resulted in three years probation, 100
hours community service, full restitution, and a $5,000 Fine.

• Patricia Sullivan Claims adjuster for CNA Insurance Company caused six setdement checks
to issue to herself and mailed to her home. Although defendant had agreed with this office to a
guilty plea, the court rejected the plea and the case was continued without a finding for one year,
and the defendant was ordered to pay restitution of $3,435.

• Daniel Nlssi Defendant acted as both insurance agent and co-insured (with wife Christine)
where the same piece of $ 12,000 jewelry was twice claimed as a loss. He falsely responded in a
1996 claim that he had not "ever sustained other theft losses." Court allowed over the objection
of the Commonwealth both defendants' motions for pre-trial probation for a period of six
months.

OPERATION KODIAK

These cases, referred by the Governor's Auto Theft Strike Force, involved an undercover operation in
which the Massachusetts State Police uncovered nine separate instances of an insured's motor vehicle
reported stolen days after the same car had been given to an undercover officer. The insureds then
collected claim settlements from various insurance carriers. Eleven individuals were indicted on 53 charges,
which had caused seven insurance carriers to pay $58,000 in fraudulent claims.

• Daniel ]. Brunke The Kodiak ringleader, Brunke pleaded guilty and was sentenced to two
consecutive two and one half year terms in the House of Correction and fined $2,000. Brunke
also was directed, as a condition of probation, to attend intensive Alcoholics Anonymous meetings
for a year. There was no restitution ordered because the individual vehicle owners are being
ordered to pay restitution.

• lohn Lacey The defendant pleaded guilty and was sentenced to six months in the House of
Correction and ordered to pay $8,661 restitution.

• ludith McNulty This Operation Kodiak claimant went to jury-waived trial after
Commonwealth rejected court's request to dismiss several of the charges and consent to pre-trial
probation on others. Not guilty on all counts.

BUSINESS AND LABOR PROTECTION BUREAU INSURANCE AND UNEMPLOYMENT FRAUD DIVISION

• Suzanne Gabriel Gabriel's husband had earlier pleaded guilty in connection with same
incident. Over Commonwealth's objection, the court imposed pre-trial probation.

MOTOR VEHICLE INSURANCE FRAUD

• Peter Godek Phony motor vehicle damage claimant was convicted after jury trial of insurance
fraud. Evidence showed that alleged vehicle roll-over occurred while vehicle was stationary.
Godek was sentenced to a term of six months in the House of Correction, suspended. At the
hearing, the judge refused to impose any restitution.

• Charles Barry Former State Trooper reported stolen an auto he had given to a girlfriend
after the girlfriend broke up with him. Guilty plea resulted in three years probation, the first six
months to be served in a community service organization, and full restitution.

• Gregory and Marzena Kolinski Phony hit-and-run claim. The case was continued without
a finding for one year on day of trial, with $ 1 5,000 restitution.

• Jocelyn Brown and Juanlta Burke Burke, a Department of Employment and Training
(DET) supervisor, falsely represented that Brown, her daughter, was employed by DET in
connection with Brown's application for personal injury benefits following a motor vehicle accident.
Both defendants admitted to sufficient facts on all of the pending charges; all charges were
continued without a finding for one year. Brown was ordered to pay $2,4 1 5 in restitution, and
Burke was ordered to pay $1 ,000 in court costs.

WORKERS' COMPENSATION FRAUD

• Anne Brown Brown, a special needs child care worker, allegedly slipped and fell outside a
client's residence. While collecting almost $30,000 in disability benefits, as well as SSA benefits,
Brown was licensed by the Commonwealth as a home-based day care provider and collected over
$11,000 in day care food reimbursement. During this time, Brown also worked under her
maiden name at a business owned by her boyfriend, James Pratt, earning over $ 1 7,000. Brown
pleaded guilty, was sentenced to 10 years probation, and was ordered to pay $24,800 restitution.

BUSINESS AND LABOR PROTECTION BUREAU INSURANCE AND UNEMPLOYMENT FRAUD DIVISION

• lames Pratt In connection with above-mentioned case, and pursuant to a cooperation/plea
agreement, Pratt pleaded guilty to conspiracy charges and was sentenced to 1 8 months probation.

• Peter Nutile Nutile worked fulltime (while getting paid in his wife's name) for 12 of the 22
months that he collected benefits. He collected approximately $22,000 illegally and attempted
to steal an additional $25,000 by settling his claim with the insurance company. Nutile pleaded
guilty and was sentenced to seven years probation, with the first six months in home confinement
on the bracelet program, and ordered to pay $25,000 in restitution.

• Edelmiro Rivera Rivera defrauded the State's Human Resources Department of $20,000,
collecting total disability benefits while owning and operating a business. He pleaded guilty and
was sentenced to six years probation and ordered to pay $20,400 restitution.

• Jeffrey Oldread Defendant notified supervisor the day after he was fired for absenteeism
that he had injured his back while working almost three weeks earlier. Defendant pleaded guilty
and was sentenced to one year in the House of Correction, suspended for three years, 1 00 hours
of community service, $1,000 fine, and $15,000 restitution.

• Stanley Davis Davis was working while collecting workers' compensation insurance. He
was sentenced to 1 8 months in the House of Correction, suspended for three years, 150 hours of
community service, and $ 1 5,000 restitution.

• Robin Hayward Hayward was collecting total disability benefits while working full time.
Guilty plea resulted in a sentence of nine months in the House of Correction, suspended for
three years, probation, and restitution of $ 1 1 ,849.

• Charles Vadnais Defendant submitted a claim stating that he was totally disabled and could
not work, and then became a full-time employee of United Airlines. Vadnais admitted to sufficient
facts, and the case was continued without a finding for two years, with a restitution order of
$9,885 and 200 hours of community service.

• Vernon Perry Using an assumed identity, Perry worked while collecting total disability
benefits. Perry pleaded guilty and was sentenced to 18 months in the House of Correction, 90
days to be served, and restitution of $4,968 to be paid to the Arbella Insurance Company.

BUS INESS AND LABOR PROTECTION BUREAU INSURANCE AND UNEMPLOYMENT FRAUD DIVISION

PROPERTY FRAUD

• lohn Pappalardo and lames Buyck Two roommates filed claims within a year of each other
for theft of identical jewelry items. Both Pappalardo and Buyck pleaded guilty on all counts.
Pappalardo was sentenced to two and one half years in the House of Correction, one year
committed, and ordered to pay $5,900 in restitution. Buyck was sentenced to six months in the
House of Correction, suspended for 18 months, with a $1,000 fine.

• Denise Alessandrini Phony lost jewelry case. The case was continued without a finding for
five years, plus full restitution.

UNEMPLOYMENT COMPENSATION FRAUD

• George lackson Upon being laid off, this construction worker began collecting
unemployment benefits. Shortly thereafter, he was rehired, but continued to collect benefits for
over five months. Jackson pleaded guilty and was sentenced to two years in the House of
Correction, ninety days to serve, and ordered to pay $8,000 in restitution.

• Nellie Anderson Inmate's sister cashed inmate's DET checks after inmate was incarcerated.
The defendant pleaded guilty to all counts and was sentenced to six months in the House of
Correction, suspended for two years, and ordered to pay full restitution.

PERSONAL INJURY FRAUD

• Commonwealth v. Leno Mendes Defendant was injured while fleeing police but later filed
a personal injury claim against his landlord, claiming the injury resulted from a slip and fall on
landlord's steps. Defendant pleaded guilty and was sentenced to 10 months in the House of
Correction and two years probation.

• Eduina Furtado Phony personal injury and bodily injury claims. Complaints issued in two
courts. Both proceedings ended as continued without a finding and partial restitution orders.

BUSINESS AND LABOR PROTECTION BUREAU INSURANCE AND UNEMPLOYMENT FRAUD DIVISION

STATISTICAL SUMMARY

Referred Complaints 319

Investigations Opened 56

Investigations Closed w/o Prosecution 47

Cases Charged 44

Cases Disposed of 50

Cases Disposed, w/ Committed Prison Time 5

Restitution & Fines Recovered $276,000

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

During Fiscal Year 2002, IUFD initiated a program to combat motor vehicle insurance fraud by
coordinating prosecutions with the Essex, Hampden, Middlesex, Suffolk, and Worcester District Attorneys'
Offices. This enterprise, which was funded by the Division of Insurance, received referrals from the
Insurance Fraud Bureau and emphasized fraud in the uninsured market. Some of the other crimes
investigated included filing false property claims, making false statements to lower premiums, and using
aliases to file false insurance claims. By the close of the fiscal year, numerous indictments were brought
against seven people as a result of the referred cases.

IUFD also commenced a disability-fraud investigations program in Fiscal Year 2002, in conjunction
with the United States Social Security Administration (SSA) . Because a portion of social security disability
benefits are paid for with state funds, this crime robs the Commonwealth's taxpayers twice: once as
federal taxpayers and again as state taxpayers. Pursuant to the agreement between the AGO and the SSA,
and with SSA funding, IUFD has hired two investigators to work closely with the SSA inspector general
to combat social security disability fraud.

BUSINESS AND LABOR PROTECTION BUREAU MEDICAID FRAUD CONTROL UNIT

OUTREACH, EDUCATION, AND TRAINING

Outreach to the community continued to be an integral part of IUFD's approach to serving the
public. To that end, as part of a cross-bureau initiative, a series of Internet safety presentations were given
to elementary and middle school students. Today's youth are using the Internet with increasing frequency,
for both educational and recreational pursuits. Unfortunately, with the increase in Internet use by children,
there has been a rise in the number of crimes committed by those who prey upon these children. The
Internet safety presentations were designed to give children some of the tools they need to access the
Internet in a safe and unaffected manner.

Additional outreach activities undertaken in Fiscal Year 2002 included the Abandoned Housing
Initiative in the central part of the state. IUFD's involvement in this initiative stems in part from the fact
that all too often abandoned structures are deliberately set on fire in order to collect insurance proceeds.
Another means of combating arson-related fraud included IUFD representation on the Statewide Arson
Task Force.

As in prior fiscal years, the IUFD staff uniformly attended continuing education classes on various
subjects with high frequency. Identity fraud, a crime that has become more prevalent in this age of the
Internet, is one area that IUFD personnel have focused on with the joint goals of prevention and
prosecution. In a similar vein, staff members were involved in the AGO Privacy Committee. Attorneys
were also active in the AGO Child Protection Project and with the Citizen Schools Program, a program
that introduces inner-city students to the legal system through involvement with a mock trial.

MEDICAID FRAUD CONTROL UNIT

The Medicaid Fraud Control Unit (MFCU) was established to protect the Massachusetts Medicaid
program, which administered the provision of over $5 billion of healthcare services to 700,000 indigent
and disabled recipients in Massachusetts last year. In addition to prosecuting corporate and individual
healthcare providers who commit crimes against the Medicaid program, MFCU is also responsible for
prosecuting companies and individuals who abuse, neglect, or mistreat elderly and disabled residents of
the Commonwealth's more than 550 long-term-care facilities, most of which are funded extensively, if
not exclusively, by the Medicaid program.

Recognizing that Medicaid fraud is complex and costly to prosecute, the federal government has
provided approximately 75% of the funding for MFCU's operation. Among its counterparts in other
states across the nation, Attorney General Reilly's MFCU has been a leader in the number of successful
criminal prosecutions and affirmative civil actions it has produced.

BUSINESS AND LABOR PROTECTION BUREAU MEDICAID FRAUD CONTROL UNIT

Consistent with its mission to protect the Medicaid program on a statewide basis, MFCU made
extensive use of the Special Grand Jury sitting in Boston, as well as its statutory and regulatory discovery
authority, to obtain indictments and convictions and to recover funds for the Medicaid program well in
excess of its budget.

In the past fiscal year, a great deal of MFCU attention was focused on prescription drug pricing, from
two very different perspectives: (1) manufacturer price inflation through average wholesale price (AWP)
fraud, kickbacks, and other schemes; and (2) diversion of prescription drugs for non-medical use by
physicians and other providers. Much of the work on the former approach is being undertaken with
various MFCUs in other states and the United States Attorney's Office. MFCU has also continued to
devote resources to its mission of protecting elders in nursing homes, through prosecution of abusers,
investigation of financial fraud by nursing homes and elder care facilities, and coordination with DPH.

MFCU included the following staff members during Fiscal Year 2002: Nick Messuri, Division
Chief; Ann Ackil; Kris Barrett; Al Brown; James Caruso; Eileen Casey', Peter Clark; Tanya Clement;
John Curley; Steve Devlin; Joe Driscoll; Elaine Duffy; Catherine Fielding; Elizabeth Foley; Marianne
Geula; Andree Lebel; Lai Ho Teresa Liu; Steve McCarthy; Anthony Megathlin; Mark Muldoon; Janice
Paterna; Bob Patten; Shirley Rokosz; Susanne Snow; Christine Soloperto; and Bernie Vivolo.

SIGNIFICANT CASE SUMMARIES

The following is a sample of cases undertaken by MFCU during Fiscal Year 2002.

BILLING FRAUD

• National Medical Care Company engaged in upcoding, unbundling, billing for services
not rendered, and kickbacks related to services provided to end-stage renal disease patients.
Massachusetts' MFCU negotiated a $7 million settlement for 48 states, with $725,000 allotted
to Massachusetts.

• Caritas Medical Group A $191,000 civil settlement was reached with the United States
Attorney's Office and MFCU to resolve a voluntary disclosure that certain physician services
were upcoded and billed to Medicare and Medicaid.

BUSINESS AND LABOR PROTECTION BUREAU MEDICAID FRAUD CONTROL UNIT

• Greater Boston MRI Upcoding and improper record-keeping practices by four affiliated
radiology groups resulted in an $850,000 civil settlement and a corporate integrity agreement for
prospective dealings.

PHARMACEUTICAL PRICING

• Bayer Pharmaceutical Corp. Pharmaceutical manufacturer paid $265,000 to the
Massachusetts Medicaid program as part of a $14 million multi-state agreement settling claims
that Medicaid made excessive payments for injectable drugs. Bayer agreed to discontinue the
practice of price inflating.

• TAP Pharmaceutical Cost-reporting fraud and kickback prosecution by United States
Attorney's Office. MFCU developed Massachusetts' damages data. Criminal conviction and
$1.9 million restitution to the Massachusetts Medicaid program.

DENTAL FRAUD

• Mohammad Sadatrafiei Defendant billed over 1 00 services relating to 4 1 patients that were
never administered, and patient files were altered to correspond to the fraudulent bills. Defendant
pleaded guilty to filing false Medicaid claims and was sentenced to six months in the House of
Correction. A parallel civil proceeding resulted in payment of restitution and fines in the amount
of $135,000.

• Robert Lew. DMD Co-owner of a dental group was charged with billing for services not
rendered. He pleaded guilty and was sentenced to six months in the House of Correction and
$131,000 restitution.

• Asadi Golinaz. DPS Employee of Brockton dental group was charged with defrauding
Medicaid. A $75,000 civil settlement resulted.

• Simon Faynzilberg. DMD Upcoding and bundling by a Lynn dentist resulted in a $40,000
civil settlement.

BUSINESS AND LABOR PROTECTION BUREAU MEDICAID FRAUD CONTROL UNIT

ELDER SERVICES

• loyce Godbout. Belllngham Elder Network Services and Blackstone Valley Bellingham
adult day health center and its owner overstated the services provided and billed for services not
rendered. Godbout's scheme netted $200,000 over four years. Godbout pleaded guilty and was
sentenced to two years in the House of Correction, suspended, and ordered to pay full restitution
and a fine.

MEDICAL EQUIPMENT AND SUPPLY COMPANIES

• Suffield Oxyg en A $54,000 civil settlement was effected, resolving allegations of this oxygen
service company double billing and upcoding.

• KCI Corp Company manipulated billing codes to maximize reimbursement for nursing
home beds and mattresses. $170,000 restitution was made to Medicaid.

• A gawam Medical Equipment Co. In a case of overboiling, the company agreed to a $375,000
settlement.

PHARMACIES

• Robert Forte Osco Pharmacy intern devised a scheme to create phony prescriptions and
steal street-value drugs, including Vicodin, Klonopin, and Xanax. Guilty plea on day of trial
resulted in sentence of two and one half years in the House of Correction, 18 months to serve,
the balance of the sentence to be suspended with probation and $35,000 restitution.

PHYSICIANS

• Loren Mimless Psychiatrist was convicted after jury trial of billing for services not rendered,
and appeals were exhausted. He was sentenced to one year in the House of Correction.

BUSINESS AND LABOR PROTECTION BUREAU MEDICAID FRAUD CONTROL UNIT

PSYCHOLOGISTS

• Emmar Morales Defendant worked as a clinical psychologist in Haverhill and Newburyport
without a license, resulting in potential patient harm and Medicaid billing fraud. Guilty plea
resulted in one year-house arrest, $50,000 restitution, and 200 hours of community service.

NURSING HOMES

• Ruth Rowe. CNA While working as a Certified Nursing Assistant at Seacoast Nursing
Home in Gloucester, Rowe committed elder patient abuse by removing the narcotic agent from
a demented patient's skin patch. Rowe pleaded guilty and was sentenced to six months in the
House of Correction, suspended for two years, evaluation for drug treatment, and a lifetime ban
on patient care work.

• Hebrew Rehabilitation Center This nursing home paid $262,000 after voluntary disclosure
of double billing Medicaid in per diem and the cost report for ancillary services.

• Daniel Brodeur Defendant embezzled personal funds of his uncle, an incapacitated nursing
home resident. Guilty plea resulted in a suspended sentence, probation, and an order of restitution.

• Blaire House Nursing Home A 131 -bed skilled nursing facility allegedly provided
substandard and neglectful care to its residents. A civil settlement for $4 1 ,000 was reached.

• Tenet Metro West Healthcare Settlement was reached with nursing home's owner regarding
allegations that the day habilitation program exaggerated disability levels of disabled clients to
obtain higher Medicaid payments. $ 100,000 restitution.

HOME HEALTH

• Home Health VNA A $35,000 settlement was reached with this Lawrence home care agency
to resolve fraudulent activity of a nurse employee.

BUSINESS AND LABOR PROTECTION BUREAU

MEDICAID FRAUD CONTROL UNIT

STATISTICAL SUMMARY

Health Care Fraud Investigations 481

Formal Health Care Fraud Cases Opened 28

Formal Health Care Fraud Cases Closed 27

Patient Abuse Investigations 54

Formal Patient Abuse Cases Opened 1 5

Formal Patient Abuse Cases Closed 3

Civil Dispositions 17

Criminal Indictments 5

Criminal Dispositions 1 2

Restitution & Fines Recovered $5,834,223

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

During Fiscal Year 2002, MFCU brought both criminal and civil enforcement actions against hospitals,
nursing home owners, pharmacies, physicians, dentists, home health care companies, billing intermediaries,
and other medical providers. These enforcement actions focused on providers that misrepresented the
services they provided to the Medicaid program, inflated the costs of their services, provided medically
unnecessary services, or violated Medicaid's anti-kickback laws. As a result of its efforts, MFCU initiated
and completed over 500 investigations, obtained indictments, secured convictions against corporate and
individual defendants, and recovered in excess of $5.8 million.

BUSINESS AND LABOR PROTECTION BUREAU MEDICAID FRAUD CONTROL UNIT

In addition, MFCU investigated physicians and psychiatrists who prescribed controlled substances
for non-medical reasons or were not supported by medical diagnosis or necessity MFCU investigated
dentists and durable medical equipment companies for upcoding and unbundling their services. MFCU
also looked at the area of pharmacy chains and pharmaceutical companies that overcharged the Medicaid
program and inflated the costs of prescription drugs. In Fiscal Year 2002, MFCU also investigated the
relationships between physicians, hospitals, and laboratories to detect illegal referrals, kickbacks, and
conflicts with patient care.

OUTREACH, EDUCATION, AND TRAINING

Outreach and education initiatives have served as integral components in maintaining MFCU's high
level of efficiency. MFCU staff had regular dealings with the Department of Medical Assistance, which
administers the Medicaid Program, in connection with a range of issues, including working conjointly
with the Department of Public Health and the Pharmacy Board in an effort to ameliorate prescription
drug abuse, including OxyContin. MFCU also worked with the Department of Mental Health in
connection with patient abuse issues. In addition, staff were involved in a drug diversion task force with
the Massachusetts State Police and the DEA. MFCU staff also were actively involved with the Boston
office of the FBI on a healthcare fraud working group.

MFCU staff made numerous presentations on Medicaid fraud prevention and health law to outside
groups, such as the Healthcare Corporate Compliance Conference, NASO Conference, Stonehill College,
and the Medical Payment Systems Association. Staff also gave presentations on elder abuse and attended
programs aimed at enhancing prosecution of this heinous crime.

MFCU staff continued to take advantage of the rich training opportunities available nationwide to
healthcare law enforcement personnel, with several new investigators and lawyers attending multi-day
trainings and conferences. Staff also continued to attend in-house programs that targeted such areas as
improved courtroom techniques.

COMMUNITY-BASED
JUSTICE BUREAU

Victim Compensation and Assistance Division
Safe Neighborhood Initiative Division

COMMUNITY BASED JUSTICE BUREAU

Community- Based Justice Bureau

The mission of the Community-Based Justice Bureau (CBJB) is to develop strategies, structure
policies, and offer recommendations that prevent crime and promote the safety, health, and welfare of
Massachusetts residents. The bureau focuses particular attention on the needs of children, crime victims,
and victims of domestic violence, and reflects the community-based approach of Attorney General Tom
Reilly.

The bureau develops and coordinates initiatives through training and education, publications and
guidelines, programs, community outreach, and legislation. Working closely with law enforcement,
state and local agencies, and community programs, CBJB concentrates its efforts in the areas of child
protection, including juvenile justice, education and school safety, family violence, community safety,
victim rights, and criminal justice policy. CBJB advises Attorney General Reilly on policy and legislative
matters in these areas. The bureau also contains the Victim Compensation and Assistance Division and
the Safe Neighborhood Initiative Division.

At the close of Fiscal Year 2002, CBJB prepared for a restructuring of the bureau to be implemented
at the outset of Fiscal Year 2003. As part of the restructuring, CBJB will merge with the Criminal
Bureau. As a result of this merger, the Criminal Bureau will contain the Safe Neighborhood Initiative
Division and the Victim Compensation and Assistance Division as well as a new division, the "Criminal
Justice Policy Division, " which will include several staff members of CBJB. The foregoing restructuring
was designed to more efficiently service criminal matters handled by the Attorney General's Office and
reflects the Office's desire to enhance the professional development of CBJB attorneys and need for
$41,000 to accommodate the staff reduction caused by a budget crisis.

During Fiscal Year 2002, the bureau included the following staff members: Beth Merachnik, Chief;
Barbara Berenson; Michelle Booth; Jean Fanning; Deepa Isac; Kristen Palma; Emily Paradise; Christina
Ruccio; and Catherine Sullivan. The Director of the Victim Compensation and Assistance Division was
Cheryl Watson, and the Chief of the Safe Neighborhood Initiative Division was Marcy Jackson.

SIGNIFICANT CASE SUMMARIES

• Commonwealth v. Finase (Supreme Judicial Court) The bureau submitted an amicus curiae
brief, arguing that a "no contact" order issued under a Chapter 209A restraining order law included

COMMUNITY-BASED JUSTICE BUREAU

within it, as a component part, a "stay order." The Supreme Judicial Court agreed, stating that
staying away was the most fundamental and important form of not contacting another person.

• McLarey v. Danalpour (First Circuit) The bureau submitted an amicus brief for this case in
the First Circuit Court of Appeals. While the Attorney General's Office took no position on the
underlying merits, the Office took the legal position that serious child sexual abuse may be
evaluated using well-recognized indicia of credibility. The First Circuit reversed and adopted
portions of the Office's brief.

• Commonwealth v. Rivera (Appeals Court) The bureau submitted a brief on direct appeal
for the Business and Labor Protection Bureau. The basis of the appeal was the absence of a
specific unanimity instruction in a case where a nursing assistant was convicted of assault and
battery against an Alzheimer's patient. A decision in this case is pending.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

CHILD PROTECTION

Children's Protection Project Attorney General Tom Reilly's Children's Protection Project
(CPP) reflects his commitment to addressing the needs of the children of the Commonwealth.
The initiative, which draws on the expertise of staff in all bureaus and in all regional offices, is
housed in CBJB. This cross-bureau initiative addresses issues concerning children, including
violence prevention strategies, health care, legislation, education, juvenile justice and gang violence,
child labor, tobacco prevention efforts, gun safety, and other topics that impact children. In
addition, CPP serves as an avenue for bureaus within the Attorney General's Office to focus their
resources and consider the issues that affect children.

During Fiscal Year 2002, the five CPP subcommittees — Legislation, Communication and
Outreach, Education and Training, Community Service, and New Initiatives — received approval
from the Executive Bureau for the majority of proposals developed. Subcommittees were charged
with prioritizing the proposals and beginning implementation as deemed appropriate.

In December 2001 , CPP sponsored a highly successful toy drive which provided approximately
350 toys to children for holiday celebrations at the Paul McLaughlin Center, the Union Hill

COMMUNITY BASED JUSTICE BUREAU

School in Worcester, the YWCA ARCH Program in Springfield, the Salvation Army in New
Bedford, and the Washington School in Lynn.

Youth Empowerment Skills (YES) Project The YES Project , funded by a Byrne Memorial
Grant awarded by the Executive Office of Public Safety (EOPS) and matching funds from the
Office of the Attorney General, was established in October 2000 in response to a need for after-
school and violence prevention programming identified by the Dorchester Safe Neighborhood
Initiative. The project was created in partnership with the Daniel Marr Boys and Girls Club of
Dorchester/Paul R. McLaughlin Youth Center, which hosts the YES Project . The goal of the
project is to provide extensive training and educational enrichment opportunities to staff and
youth at the McLaughlin Youth Center. Through the YES Project . Attorney General Tom Reilly
seeks to provide teens with supervised, after-school activities and to offer at-risk youth a meaningful
life skills education that helps them avoid risky behavior which may lead to school failure, substance
abuse, involvement in the criminal justice system, and victimization by crime.

During this Fiscal Year, the Project Manager continued to develop and implement the YES Project
curriculum. Programs included: (1) the continuation of a volunteer-based tutoring program
with volunteers from the Attorney General's Office serving as weekly tutors for students; (2) teen
workshops on, among other topics, Internet safety, healthy relationships, bullying, substance
abuse, the rights of teens in the workplace, and consumer protection; (3) cultural awareness
presentations on black history and the Islamic culture; (4) the development of a Gang Violence
Prevention Video Curriculum; (5) a college preparation program that included college alumni
panels, application workshops, financial aid information sessions, and tours to colleges and
universities in New England, New York, and the Washington, D.C. area; (6) a community service
project; (7) a holiday toy drive; (8) ballet and tap classes taught by Attorney General's Office
volunteers', (9) a weeklong basketball camp with an educational curriculum focusing on geography,
nutrition, and reading skills; and (10) staff trainings on topics including substance abuse and
helping children cope with grief and loss. Bureau staff also completed and submitted the Year 3
YES Project grant application to EOPS and secured $55,000 in funding.

Citizen Schools Bureau staff spearheaded the Attorney General's participation in the Citizen
Schools mock trial apprenticeship program. Staff organized formation of an Attorney General's
Office Team for students from the Wheatley School. Mock trials were held in December 2001
and May 2002, with office staff serving as jurors and witnesses.

COMMUNITY-BASED JUSTICE BUREAU

Citizen Schools Apprenticeship Bureau staff developed and launched a new Attorney General's
Office Citizen Schools Apprenticeship titled Beyond Stereotypes and Prejudice: How to Foster
Understanding and Respect in Your School , a 1 0-week program held weekly at the Grover Cleveland
Middle School in Dorchester. The program goal was to help students become aware of issues
such as stereotypes, inclusion, and exclusion (in their own lives, at school, and in society), and to
empower them through instruction in basic conflict resolution skills. As a final project, each
student presented a poster that he or she created to educate others about important issues covered
in the curriculum.

MDAA juvenile justice Subcommittee A bureau attorney participated in meetings of the
Massachusetts District Attorneys Association's Juvenile Justice Subcommittee.

Children's Justice Act Conference Bureau attorneys attended the CJA Conference, Protecting
Children in a Chang in g Society , held in Hyannis, MA.

Equal Justice Partnership and EIP Working Group Bureau staff participated in both the Equal
Justice Partnership and the EJP Working Group.

Norfolk County District Attorney's Children's Advocacy Center Advisory Board A bureau
member participated in meetings of the Norfolk County District Attorney's Children's Advocacy
Center Advisory Board.

Statewide Child Fatality Review Team A bureau member participated in meetings of the
Statewide Child Fatality Review Team, convened to review child deaths.

DOMESTIC VIOLENCE

Building Bridges of Support for Mothers Who Are Victims of Domestic Violence Fiscal Year
2002 saw the successful completion of the Violence Against Women Act's (VAWA) grant-funded
Building Bridges of Support for Mothers Who Are Victims of Domestic Violence Project . Under
the grant, CBJB staff developed and implemented a training program for prosecutors, victim
witness advocates, advocates from battered women's programs, and police officers on the special
needs of battered women who have children.

The training, Building Bridges of Support for Mothers Who Are Victims of Violence , was
divided into two stages. Phase I, completed in Fiscal Year 2001 , consisted of two one-day regional

COMMUNITY-BASED JUSTICE BUREAU

trainings, conducted in Plymouth and Northampton, for assistant district attorneys and victim
witness advocates and covered a wide range of topics, including trauma, the victim's experience
in the criminal justice system, the effects of domestic violence on children, criminal prosecution,
and the role of public agencies. Phase II included two one-day regional training programs in
Newton and Springfield for police officers and advocates from battered women's programs.
CBJB staff also led and facilitated many of the trainings. Upon completion of the training
component, staff assembled a domestic violence resource manual made up of the training materials,
which was distributed statewide to district attorneys offices and domestic violence victim witness
advocates.

Protecting Elders from Domestic Abuse A bureau member organized and moderated a panel
presentation for the Annual Conference of the Massachusetts Association of Councils on Aging
and Senior Center Directors held in Hyannis, MA. Titled Protecting Elders from Domestic
Abuse , the panel addressed the issue of elders and domestic abuse and included staff of the Elders
and Persons with Disabilities Unit of the Suffolk County District Attorney's Office and
Minuteman Senior Services of Burlington, Massachusetts.

Department of Justice Grant Staff prepared and submitted a successful application to the
Department of Justice for a Training Grant to Stop Abuse and Sexual Assault Against Older
Individuals or Individuals with Disabilities Program. The program is tided The Attorney General's
Elder Abuse Project -
Governor's Commission on Domestic Violence Bureau staff attended and participated in
meetings of the Governor's Commission on Domestic Violence.

MDAA Meeting s A bureau attorney participated in monthly meetings of the Massachusetts
District Attorneys Association Domestic Violence Subcommittee.

Employers Against Domestic Violence (EADV) Bureau members attended an EADV conference
and EADV meetings.

SCHOOL SAFETY

Safe Schools Newsletter Bureau staff produced and distributed the Safe Schools Newsletter to
school administrators, Police Chiefs, and District Attorneys throughout the state. Topics included

COMMUNITY BASED JUSTICE BUREAU

hate and harassment, civil rights injunctions, high-tech and computer crimes, protecting children
from tobacco, legal updates, and legislation concerning issues applicable to schools.

Safe Schools Task Force CBJB staff and Public Protection Bureau staff convened the Task
Force, which provides a forum for cross-bureau information-sharing on school safety trends.
The Task Force discusses Attorney General's Office strategies to help address school violence and
promote school safety.

MATS (Multi-Agency Task Force) Bureau members participated in a MATS team effort, along
with Criminal Bureau staff, to address environmental health and safety issues in public schools in
the Commonwealth. Staff worked to develop potential statewide training on issues of
environmental concern for schools.

SUBSTANCE ABUSE

Attorney General's Statewide College and University Coalition on Underage and Problem
Drinking During Fiscal Year 2002, CBJB staff continued to lead the coalition on underage and
problem drinking. The Coalition, made up of representatives from approximately 25 colleges
and universities throughout the state, focused on developing creative solutions to the problem of
underage and binge drinking on college and university campuses. The objective of the Coalition
was to develop a cooperative agreement committing the colleges and universities to undertake
specific prevention, intervention, and enforcement efforts concerning alcohol use and abuse on
campus. The Coalition completed its draft agreement and presented it to their members, college
health educators, campus police officers, and college presidents. The Coalition met regularly at
the College of the Holy Cross in Worcester.

Governor's Advisory Council on Substance Abuse A bureau member attended monthly
meetings of the Governor's Advisory Council on Substance Abuse.

Mothers Against Drunk Driving Bureau staff participated in Mothers Against Drunk Driving
public policy meetings and advised on developing legislation to strengthen laws on motor vehicle
homicide, repeat offenders, and implied consent.

COMMUNITY-BASED JUSTICE BUREAU

Emerg in g Drug Task Force A bureau member participated in the Department of Public Health's
Emerging Drug Task Force.

HATE CRIMES

Attorney General's Hate Crimes Task Force CBJB staff actively participated in the Attorney
General's Hate Crimes Task Force. Initiatives included developing and implementing a series of
proposals focusing on education and training, publications, and community involvement. CBJB
staff served as co-chair of the Subcommittee on Training, Education and Prevention.

Massachusetts Hate Crimes Training Team A CBJB staff person served as a member of this
U.S. Department of Justice Initiative. The CBJB representative, as part of the team, conducted
hate crimes training for local police departments.

SPORTS VIOLENCE

Massachusetts Alliance for the Promotion of Sportsmanship CBJB collaborated with the
Criminal Bureau in establishing the Massachusetts Alliance for the Promotion of Sportsmanship
(MAPS) , co-convened by Attorney General Reilly and then-Suffolk County District Attorney
Ralph Martin. Established in response to several well-publicized incidents of sports violence,
MAPS sought to advance collaborative initiatives in an effort to generate a culture in Massachusetts
that fosters healthy atdtudes and responsible conduct by athletes, coaches, officials, and spectators
of all ages. MAPS membership included law enforcement, professional sports teams, college
athletes, and high school sports programs.

LEGISLATION

Le gislative Activity Bureau staff members drafted, reviewed, and commented on legislative
proposals. Some examples include:

• participating on AGO/MDAA Committee to amend child abuse and neglect mandated repordng
law to include clergy;

COMMUNITY BASED JUSTICE BUREAU

• recommending amendments to pending legislative proposals concerning the victim compensation
statute; and

• assessing the constitutionality of An Act Relative to Profits from Crime and considering whether
the Attorney General's Office would file an amicus brief in support of the legislation in response
to a Request for Advisory Opinion from the SJC.

Employers Against Domestic Violence (EADV) A bureau attorney participated in meetings of
the EADV Employment Law Legislative Subcommittee.

MDAA Meeting s A bureau attorney participated in monthly meetings of the Massachusetts
District Attorneys Association's Legislative Subcommittee to review and prioritize pending or
proposed criminal justice legislation.

Commonwealth Attorneys Appellate Action Project (CAAAP) Bureau attorneys attended
regular meetings of the Commonwealth Attorneys Appellate Action Project.

OUTREACH, EDUCATION, AND TRAINING

INTERNET SAFETY

CBJB staff, in conjunction with staff of the Criminal Bureau and the regional offices, conducted
trainings on Internet safety throughout the Commonwealth. Among them were presentations at local
schools, public hearings, and an Internet expo. Staff also distributed The Internet, Your Child, And You:
What Every Parent Should Know and Internet Safety: Advice from Kids Who Have Faced Danger Online
to schools serving students in grades 4-8. Over 350,000 copies of the guides were provided. In addition,
staff conducted trainings on search and seizure in schools.

HATE CRIMES

CBJB staff, in collaboration with the Civil Rights Division, developed promotional materials and
substantive content for a training series titled A Prerequisite for Safe Schools: Protecting Students from
Harassment and Hate Crimes . Staff developed and facilitated workshops on such topics as: establishing
a comprehensive civil rights program, identifying and responding to harassment and hate crimes, fostering

COMMUNITY-BASED JUSTICE BUREAU

a school climate that appreciates diversity, and creating successful partnerships between schools, law
enforcement, and the community. The first two regional trainings were held in Fiscal Year 2001 . The
third and fourth regional conferences were held in Fiscal Year 2002 for Norfolk and Worcester counties,
and for Bristol County, Plymouth County, and the Cape and Islands.

DOMESTIC VIOLENCE

CBJB staff spoke on domestic violence and the criminal justice process to various groups, including
the Boston College Law School Domestic Violence Advocacy Project. Bureau members and regional
office staff also conducted trainings on teen dating violence for McLaughlin Youth Center staff and
SCORE coordinators and on college campuses.

CRISIS RESPONSE TRAINING

Bureau staff served as members of the Cambridge Health Alliance Community Crisis Response
Team, which provides crisis response in the aftermath of trauma to communities in crisis.

INTERNAL WORKING GROUPS

Attorney General Tom Reilly places a high priority on creating a strong, cohesive workforce. In an
effort to eliminate barriers and encourage collaboration among the several bureaus and divisions within
the Office, the Attorney General created a number of internal working groups. CBJB staff participated
in several of those groups, among them, the Children's Protection Project, the Post-September 1 1 Working
Group, the Education Working Group, and the Hate Crimes Task Force.

PUBLICATIONS

• Safe Schools Newsletter Staff drafted articles for and coordinated development of the Fall
2001 edition of the Safe Schools Newsletter. The newsletter included articles on hate and
harassment, civil rights injunctions, high-tech and computer crimes, protecting children from
tobacco, and recent case law. The newsletter was distributed to an audience of over three thousand,
including school administrators (public and private) , Police Chiefs, and District Attorneys.

COMMUNITY-BASED JUSTICE BUREAU VICTIM COMPENSATION AND ASSISTANCE DIVISION

• Teen Dating Violence & Restraining Orders: The Law and Safety Planning CBJB staff
continued to distribute copies of the teen dating violence brochure.

• The Internet. Your Child. And You: What Every Parent Should Know and Internet Safety:
Advice from Kids Who Have Faced Danger Online Bureau staff continued to distribute
copies of parent and student guides.

VICTIM COMPENSATION AND ASSISTANCE DIVISION

The Victim Compensation and Assistance Division (VCAD) is responsible for administering G.L.
c. 258C and the Commonwealth's Victim Compensation Fund. The division provides financial
compensation, referrals, and other assistance to victims of violent crime. Most significantly, division
staff assist qualifying victims and their families in paying for out-of-pocket crime-related expenses, including
medical and counseling expenses, lost wages, funeral and burial expenses, and loss of support. Since
1994, 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. In addition,
in Fiscal Year 2002, the Office of the Attorney General assumed responsibility for the payment of claims,
taking over that responsibility from the State Treasurer's Office.

During Fiscal Year 2002, division staff included Cheryl Watson, Division Director; Sandra Clark;
James Clarkin; Jessica Cruzatti-Flavius; Gael DeCologero; Erica Johnson; Julie King; Deikel Lynch;
Laura Michalski; Lori Murphy; Priscilla Russell; James Sinagra; and Jennifer Wilson.

COMMUNITY-BASED JUSTICE BUREAU VICTIM COMPENSATION AND ASSISTANCE DIVISION

STATISTICAL SUMMARY

CLAIM INFORMATION TOTAL # CLAIMS

New Claims Received 1,742

New Claims Opened 1,211

Supplemental Claims Opened 798

Administrative Review 35

Decision Affirmed 30

Modified or Reversed 5

Homicide Claims 287

Judicial Review 4

In Fiscal Year 2002, the Victim Compensation and Assistance Division received 1 ,742 new claims, an
increase of 1 5% over the 1 ,509 claims received during the last fiscal year. This increase is likely due to the
division's ongoing efforts to increase public awareness of the program. During this fiscal year, the division
received 287 homicide claims compared to 194 in Fiscal Year 2001 and 140 during Fiscal Year 2000. Of
the 287 homicide claims, 37 were terrorism claims submitted by family members of victims of the
September 11, 2001 attacks.

EXPENDITURES

During this fiscal year, the total compensation awarded to victims was $3,236,518. Approximately
$2.1 million came from state funds, and the remainder came from federal funds. This marks an approximate
9% increase over awards issued last year. This is the seventh consecutive year in which the division had
adequate funding to support expenditures.

COMMUNITY-BASED JUSTICE BUREAU VICTIM COMPENSATION AND ASSISTANCE DIVISION

PROGRAM EVALUATION

An applicant survey is sent to each claimant with decisional letters. The division received 374
completed surveys from claimants. Surveys were overwhelmingly positive, with more than 89% of
claimants agreeing or strongly agreeing that applications are easy to complete, that division staff treated
them with courtesy and respect, that their questions were answered, and that they were satisfied with the
decision on their claim and the amount of time it took for processing.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

GRANT ACTIVITY

The division applied for and received an annual grant for Fiscal Year 2002 from the Department of
Justice through Victims of Crime Act funds in the amount of $546,000. These funds are used to
supplement state payments of awards made directly to crime victims. A small portion of the grant is used
for program administration.

The division also applied for and received a grant for Fiscal Year 2002 from the Executive Office of
Public Safety through the Department of Justice, Violence Against Women Act funds in the amount of
$48,930. These funds were used to hire an investigator/victim advocate to provide specialized services to
domestic violence, sexual assault, and stalking victims who seek compensation and services from the
division.

FEDERAL REPORTING REQUIREMENTS

The division submitted an annual Certification Report and quarterly reports to the Department of
Justice, Office for Victims of Crime for the Victims of Crime Act. In addition, the division submitted
quarterly reports to the Executive Office of Public Safety for the grant under the Violence Against
Women Act, referenced above. Finally, an annual Performance Report and Grant Application were
submitted requesting continuation funding from the Department of Justice through the Victims of
Crime Act.

COMMUNITY-BASED JUSTICE BUREAU VICTIM COMPENSATION AND ASSISTANCE DIVISION

LEGISLATIVE ACTIVITY

A bill was filed jointly with the Massachusetts Office for Victim Assistance to amend the Victim
Compensation law. The bill would expand certain benefits under G.L. c. 258C and assist crime victims
in paying for the most frequently requested crime-related costs. The Attorney General's Office continues
to seek passage of this bill. Staff promoted the legislation at a legislative breakfast sponsored by the
Massachusetts Office for Victim Assistance and the Bristol County District Attorney.

AUTOMATION

During Fiscal Year 2002, the division successfully implemented a new software program to expedite
the processing of compensation claims. All case-related data from the previous program was converted
and installed into the new program.

POSTER DISTRIBUTION

Staff created a new Victim Compensation poster to help increase public awareness of the program.
Using posters created by art students at the Paul McLaughlin Youth Center, division staff developed a
calendar in recognition of Victim Rights Week and distributed it at the annual Victim Rights Conference
at the Copley Plaza Hotel in April.

OUTREACH, EDUCATION, AND TRAINING

Outreach and training about the program and its benefits remained a primary focus for Fiscal Year
2002. Victim Compensation training was provided to:

• Wayside Youth Services, Department of Social Services, CHERRS Program at Dorchester House,
Victim of Crime Act subgrantees for the Massachusetts Office for Victim Assistance;

• Help for Abused Women and Children, U. Mass Medical Center, Codman Square Health Center,
Greater Boston Legal Services, Springfield District Attorney's Victim Witness Assistance Program,
Northampton District Attorney's Victim Witness Assistance Program;

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

• SAFEPLAN Domestic Violence Advocates, Middlesex District Attorney's Victim Witness
Assistance Program;

• University of Mass., U. Mass Medical Center Domestic Violence Program, Worcester Youth
Guidance Center, Casa Myrna Vasquez, Wayside Community Roundtable", and

• Building Bridges of Support for Moms workshop series sponsored by the Attorney General's
Office.

In addition, division staff participated in a number of initiatives as the result of the September 1 1
terrorism attacks. A staff member worked one week at Pier 94 for the New York Victim Compensation
Program assisting victims and their families who came seeking help. Staff participated in regular conference
calls with the Department of Justice, the National Association of Crime Victim Compensation Boards
(NACVCB), and victim service professionals from the other affected states. Staff played a key role in
assisting the Department of Justice with drafting regulations to provide a federal compensation program.

Division staff also participated in training events sponsored by Representative Martin Meehan, Senator
Ted Kennedy, the FBI, the U.S. Attorney's Office, the Massachusetts Office for Victim Assistance and
the NACVCB. In addition, division staff attended the annual National Organization for Victim Assistance
Conference in Nashville, TN, the NACVCB regional conference in Annapolis, MD and the NACVCB
national conference in Washington, D.C.

During this Fiscal Year, staff represented the Attorney General at the following meetings:

• Governor's Domestic Violence Commission, Faith Communities Working Group, a subcommittee
of the Governor's Domestic Violence Commission;

• Advisory Committee of the Norfolk County District Attorney's Children's Advocacy Center,
Victim Witness Assistance Board;

• Massachusetts Hate Crime Training Team sponsored by the Department of Justice, Cambridge
Health Alliance Community Crisis Response Team, Boston Area Sexual Assault Coalition, and
the Executive Office of Public Safety's Sexual Assault Evidence Collection Kit Advisory Committee.

SAFE NEIGHBORHOOD INITIATIVE DIVISION

The first Safe Neighborhood Initiative (SNI) was established in Dorchester in February 1993 by the
Office of the Attorney General, the Suffolk County District Attorney's Office, the Mayor's Office of the
City of Boston, and the Boston Police Department. Based on the premise that no single group alone can

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

solve all problems faced by a community, the SNI provides a framework for community residents and
service providers to work collaboratively with law enforcement and government agencies to identify and
address priority public safety and quality of life issues in the community. The SNI model has been
replicated in a number of communities across the Commonwealth — each using a somewhat different
approach. Some are law enforcement driven while others are community driven, but all are organized
around the three core principles of coordinated law enforcement; neighborhood revitalization; and
prevention, intervention, and treatment. During Fiscal Year 2002, the Office of the Attorney General
participated in active SNI partnerships in Taunton, Brockton, the Montague Village of Turner Falls, and
the Grove Hall and Dorchester neighborhoods of Boston. Beyond establishing and participating in the
various community SNIs, the SNI Division embarks on numerous innovative community-based activities
to prevent crime and promote public safety, many of which are described in the sections below.

During Fiscal Year 2002 , the division staff included Marcy Jackson, Division Chief; Linda DelCastilho;
Ellen Frank; Jennifer Grigoraitis; Katherine Hatch; Tim McDonough; Christina Ruccio; Lenell Silva;
and Neil Tassel. Assistant Attorney General Julie Ross, assigned to the High Tech and Computer Crime
Division in the Criminal Bureau, was assigned to a four-month rotation from February through May
2002 prosecuting Grove Hall SNI cases in the Roxbury District Court.

SIGNIFICANT CASE SUMMARIES

The SNI's Community Prosecution Program is critical to its coordinated law enforcement component.
SNI attorneys at the Superior and District Court levels continued to expand on their traditional roles as
prosecutors by continuing their close work with community partners. SNI prosecutors attended
community meetings, participated in special events, and responded to inquiries from law enforcement,
residents, and social service agencies. As a result of their direct community involvement, the SNI attorneys
were able to assess issues of the most importance to the community and help determine how resources
from the Attorney General's Office could best be utilized to address those concerns. In addition, the
Assistant Attorneys General developed joint initiatives with other law enforcement agencies, including
federal law enforcement authorities for enhanced federal prosecutions. The Assistant Attorneys General
for the Dorchester and Grove Hall SNIs prosecute major felonies in Superior Court consisting primarily
of repeat drug offenders, large-scale drug seizures, armed robberies, armed career criminals, and firearm
offenses. The Assistant Attorney General for the Montague SNI prosecutes primarily narcotics and
domestic violence violations. Examples of case summaries are included below.

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

• Commonwealth v. Archie Lane (Dorchester) This defendant was the subject of investigation
and a search warrant at his home and was subsequently indicted for Possession with Intent to
Distribute Cocaine. While on bail, he was seen asleep in a running car by officers who knew him
to be unlicensed. When he stepped out of the car, he dropped five bags of crack to the ground.
The defendant was tried for his second arrest first. He was convicted and sentenced to five years
in Cedar Junction. He then pleaded guilty on the original case.

• Commonwealth v. Neftall Hebron (Dorchester) This defendant was on probation in Lynn
for OUI when he was arrested in Dorchester for trafficking cocaine. In that arrest, the police
followed up on a tip that cocaine was going to be delivered to a particular house at a specific time.
The defendant arrived and was questioned and consented to a search; cocaine was found in his
pocket. The prosecutor appeared in Lynn several times for probation surrender hearings. Eventually,
the defendant surrendered in Lynn, pleaded guilty, and received a three-to-five year sentence.

• Commonwealth v. Martin White (Dorchester) This defendant broke into a vacant home
during the daytime. When the family returned home, they encountered the defendant in the
house. A violent fight ensued, and the defendant was stabbed and subdued and held for the
police. He accused the family of attacking him and dragging him into the home. He pleaded
guilty and was sentenced to four to five years.

• Commonwealth v. Kelo Gibbs (Grove Hall) A woman was making food deliveries by car,
and while stopped at a red light, she was approached by two males, one of whom pulled her from
her car and jumped into the driver's seat and drove off. Police officers spotted the victim's car
within minutes of the incident, and the car fled from the marked cruiser. The car disappeared for
a few minutes. Thereafter, different officers saw the defendant getting out of the parked car
carrying take-out food from the victim's employer's establishment and carrying a black bag
belonging to the victim. The victim identified the defendant at a show-up as the man who had
pulled her from her car. The defendant's beeper was found inside the victim's car, and he also
resisted arrest when the officers initially attempted to place him into custody. The second suspect
involved in the carjacking was identified by the police, but the victim could not identify him.
The defendant was indicted on charges of Carjacking, Assault & Battery, and Resisting Arrest.
After trial, a superior court jury found the defendant guilty on all three counts. He was sentenced
to six to seven years in state prison on the Carjacking count with two years probation from and
after on the Assault & Battery and a guilty was filed on the Resisting charge. The defendant was
on probation for robbery at the time that he committed this offense, and the judge sentenced
him to concurrent house time on the probation case. Jury found defendant guilty on all three
counts.

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

• Commonwealth v. Lolita Hopkins (Grove Hall) Police officers stopped a car for failing to
use turn signals and discovered that the operator was operating after his license was suspended. In
running warrant checks on the remaining three occupants, the officers found that the defendant
had two outstanding warrants. As the officers were arresting her, she revealed that she had crack
in her pocket — "two halves, a bunch of rocks, and some weed." The officers recovered a tube
with two bags of crack; another bag with many smaller rocks, all individually wrapped; and
marijuana. The estimated weight was between 14 and 27 grams. The defendant's boyfriend (the
driver) had $304 on him — 27 five-dollar bills, six 10-dollar bills, 89 one-dollar bills and one
20-dollar bill. The money was in several pockets and in many different bundles. The defendant
pled guilty to a reduced charge of Possession of Class D with Intent to Distribute. She was
sentenced to two to three years in state prison. The Possession of Class B resulted in a guilty-filed
and the School Zone count was dismissed.

• Commonwealth v. Mark Gibson (Grove Hall) The police responded to a call for a motor
vehicle accident, and when they arrived at the scene, both vehicles were unoccupied. A witness
reported that one driver (defendant) got out of his car and robbed the driver of the second vehicle
and then chased him away. The witness also reported that the defendant had a female passenger
with him. Within minutes, other officers spotted the defendant and approached him. He
became very violent and knocked one officer to the ground and hit another. The victim, meanwhile,
had run home and called 91 1; he was directed by the dispatcher to return to the scene. Upon
doing so, the victim identified the defendant as the man who had robbed him at knifepoint of
his ATM card and $ 1 2-$ 1 5 cash. The defendant was found with a knife, the victim's ATM card,
and $13 cash. At the police district station, the defendant's mother had reported that about
12:00 a.m., she had noticed her car keys missing and that her son had left the house at 1 1:30 p.m.
and did not have her permission to use her car. She reported that her son had taken her car in the
past and she had told him repeatedly not to take the car. The defendant had only a learner's
permit and was not licensed to drive. The defendant was charged with Armed Robbery, Leaving
the Scene of an Accident, Unlicensed Operation of a Motor Vehicle, and two counts of Assault &
Battery on a Police Officer. The defendant had no adult record and two dismissals in the juvenile
system. This case was resolved in district court with the defendant pleading guilty and sentenced
as follows: Larceny from Person, 18 months in the House of Correction, committed; Leaving
the Scene of an Accident, guilty-filed; Unlicensed Operation of a Motor Vehicle, guilty-filed;
Assault and Battery on a Police Officer, guilty, 18 months in the House of Correction committed;
Assault and Battery on a Police Officer, guilty-two years probation from and after the committed
sentence with several conditions (psychopharmacological evaluation, compliance with medications

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISIO N

regimen, anger management program, individual therapy as recommended, and completion of
grade 12).

• Commonwealth v. William F. Bauch HI (Montague) The defendant was charged with
Home Invasion, Entering at Night for Felony Placing Person in Fear, and Assault and Battery.
The case was resolved in district court with the defendant pleading guilty to Entering at Night
for Felony charge. The defendant was sentenced to one and one half years in the House of
Correction: six months to serve, the balance suspended for two years.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

BROCKTON SNI

The Brockton SNI Advisory Council continued to meet regularly to address the needs and concerns
of the community related to crime prevention and neighborhood revitalization. The Attorney General's
Office supports the position of the SNI Community Liaison who is based in the Plymouth County
District Attorney's Office and works closely with that office and the Assistant District Attorney community
prosecutor. One of the primary focuses and successes of the Brockton SNI this year was an effort to
increase resident participation in the SNI. Toward this end, the SNI Community Liaison built numerous
relationships with a variety of organizations and agencies in the community and also publicized meetings
through the Community Calendar Website, Brockton Cable Access Channel, and the monthly distribution
of fliers.

The Brockton SNI continues to generate a network of support from other community agencies.
During the past year the SNI established working relationships with the Brockton Fire Department,
Brockton Neighbors United, Brockton Area Multi-Services, Board of Health, Assessor's Office, and the
Registry of Deeds. The SNI also continues to work closely with law enforcement agencies in an effort to
fight crime within the Brockton community.

The Brockton SNI collaborated with community service providers on a number of initiatives this
year. Some examples are listed below.

Vacant Lot/Neighborhood Clean-Up This initiative was established by the Attorney General's
Office in collaboration with the Plymouth County District Attorney's Office, the Mayors Office,

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

the Office of Community Corrections, and the Department of Public Works. The purpose of
the project is to provide community residents with assistance by cleaning vacant lots and
neighborhood streets to help revitalize the neighborhoods. The project is ongoing and residents
are encouraged to report concerns about properties and requests for clean-ups.

Landlord Notification This initiative was established by the Plymouth County District Attorney's
Office and was revived this year with assistance from the SNI Community Liaison who renewed
working relationships with the Assessor's Office, the Registry of Deeds, the Board of Health, the
Brockton Fire Department, and the Southeastern Housing Court. Research is conducted and
landlord notifications are processed for the signature of the District Attorney and the Chief of
Police. The notification provides information to landlords whose tenants have been charged
with drug-related crimes. They are provided with information that may assist them in
understanding their obligations to maintain the safety of their properties as well as information
about the eviction process. This is an ongoing project that targets selected cases from the daily
drug arrests.

Community Police Leadership Council The SNI Community Liaison participated in monthly
meetings that focus on law enforcement crime prevention within the community.

Brockton Neighbors United Council The SNI Community Liaison participated in monthly
meetings focused on the prevention of child abuse and neglect by strengthening families and
building community by establishing links with various resources in the community

Partnership for Safer Communities The SNI Community Liaison participated in National
Night Out Against Crime Committee meetings and attends this event every year. An information
booth is set up for the distribution of informational fliers and brochures.

Local Law Enforcement Block Grant Council The SNI Community Liaison participated in
monthly meetings by planning crime prevention initiatives in the community.

DORCHESTER SNI

The Dorchester SNI continued to focus on issues that have consistently plagued the area — truancy,
youth violence, and a lack of job opportunities and training. The Boston Police Department targeted
truancy while other subcontracted programs provided opportunities for young people to effectively use
the time when they are not in school by offering recreational, educational, and job training programs.

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

Additionally, community workers were actively involved with the Cape Verdean and Vietnamese
communities, working to assess and address their needs. Through the work of a Cape Verdean youth
outreach worker, funded by the SNI and contracted through the Bowdoin Street Health Center, the SNI
has been able to address issues facing Cape Verdean youth. Issues of violence, family, education, health,
and job opportunities are regularly addressed in the Cape Verdean youth groups which meet weekly. The
Dorchester SNI has also created a strong network of support for other emerging immigrant groups,
children who witness violence, and the local business community.

The Dorchester SNI Advisory Council continued to meet regularly to identify the most pressing
needs of the Dorchester SNI community. The Office of the Attorney General, through a grant from the
Executive Office of Public Safety, completed its eighth year of funding for subcontracted programs in
the Dorchester SNI, offering assistance to law enforcement efforts as well as prevention efforts that
included numerous enrichment, educational, and recreational programming for children, youth, and
adults. Offered through direct service providers in the community, programming included youth safe
haven activities at the Dorchester Youth Collaborative, educational and training programs for local small
business owners, police training, and clinical assistance for children who witnessed violence. To complement
the ongoing activities of the Dorchester SNI, the Advisory Council awarded mini-grants for three projects
during Fiscal Year 2002.

Media Literacy Project A new program administered by Boston Community Centers in
partnership with the Log School Settlement House. The Project provided primarily Cape Verdean
youth ages 13-16 with a structured after-school environment and training in radio, television,
and music production.

My First lob A program of Dorchester Youth Collaborative provided information to teens at
the Grover Cleveland Middle School on the availability of summer jobs and assisted the youth
with the job application process. My First Job Program also provided youth with job readiness
counseling and training prior to beginning their summer positions.

African Dance and Art Collaborative Administered by the Bowdoin Street Health Center, the
African Dance and Art Collaborative provided youth ages 9-14 with after-school dance and
visual arts activities at the St. Peter's School in Dorchester culminating in a dance performance
and art show in June.

During Fiscal Year 2002, the Dorchester SNI was invited by the Executive Office of Public Safety to
apply for funding for Fiscal Year 2003 to expand on the successes of the previous eight years. Through a
collaborative process, Dorchester SNI partners developed a proposal for the Dorchester Youth and Family

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

Project (DYFP) , the goal of which is to reduce and ultimately prevent youth crime by addressing a variety
of factors underlying youth crime. The proposal was presented to and approved by the Executive Office
of Public Safety. The Project will be funded by a Byrne Memorial Grant starting in Fiscal Year 2003.

GROVE HALL SNI

In October 2001 , the Grove Hall Safe Neighborhood Initiative began its second cycle as an officially
recognized Weed and Seed site by the Department of Justice, Executive Office for Weed and Seed. In
October, the Grove Hall SNI was awarded $175,000 to support its activities centered on the four core
Weed and Seed principles: (1) Law Enforcement (e.g., the investigation and elimination of open air and
large-scale drug distribution); (2) Community Policing (e.g., police and community partnership to enhance
traffic control and school safety and improve domestic violence response) ; (3) Neighborhood Restoration
(e.g., the promotion of affordable housing and commercial development and the monitoring of
construction and renovation of schools sites); and (4) Prevention, Intervention, and Treatment activities
to bolster the safe haven capacity of the community. Several community programs were awarded "seed"
mini-grants for their programs that collectively provide safe haven capacity and centered on priority issues
identified by the target community. The programs were: Roxbury Multi-Service Center's CPASA and
SENIORS programs; New Vision Community Development Corporation/Quincy Geneva Housing
Corporation's Creative Learning After School Program; Grove Hall Residents Association's Youth
Development and Early Intervention Program; We're Educators- A Touch of Class (WEATOC) ; Women
of Color AIDS Council- Women Connecting and Effecting Change; and Harvard Street Neighborhood
Health Center's Youth Substance Abuse Task Force.

The Grove Hall SNI/Boston Weed and Seed Site's Coordinating Council held seven regular meetings
during the year and five community meetings attended by dozens of community residents in addition to
representatives from law enforcement, government agencies, courts, service providers, and faith-based
organizations.

NORTHWESTERN DISTRICT SNI

Attorney General Reilly recognizes that issues of crime and neighborhood revitalization are not confined
to large urban centers. For several years, the Attorney General and Northwestern District Attorney
focused efforts in the Montague SNI by adding prosecution resources to address crime and eliminate
drug trafficking in the Village of Turners Falls. These prosecution activities were largely successful, and it

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

was determined that the Attorney General's Office would continue its SNI collaboration with the
Northwestern District Attorney's Office to develop a new SNI in the Town of Orange. Members of the
Attorney General's Office and the District Attorney's Office began collaborating with the Town of Orange
and its Police Department to start planning this new initiative. In March 2002, an AAG was assigned to
the Orange District Court, where she assumed responsibility for prosecuting criminal cases occurring in
the Town of Orange and additional cases committed by Orange residents. Her caseload involves offenses
involving domestic violence, other assaultive conduct, breaking and entering/larcenies, and substance
abuse involving both alcohol and narcotics. In May 2002, the first meeting of the Orange SNI Advisory
Council was held with attendees representing numerous agencies, organizations, and community residents.
Over the coming year, the Advisory Council will work to build a structure for the Orange SNI and to
identify priority public safety and quality of life issues and strategies to address these issues.

TAUNTON SNI

The Taunton SNI continued to focus on law enforcement, crime prevention, prevention, and quality
of life issues. SNI partners include a broad base of representatives, among them, law enforcement,
probation officers, health professionals, city agencies, and direct service providers. The City of Taunton
continued to play a pivotal role in coordinating the efforts of the Taunton SNI partners. Representatives
from the SNI Division participated in the monthly SNI Advisory Council meetings. The SNI Division
facilitated the collaboration of the Attorney General's Office with the City of Taunton on its abandoned
property initiative. As part of the initiative this year, a single-family home was placed into receivership
and subsequently rehabilitated. The property will be sold to a qualified buyer at an affordable rate early
next fiscal year.

CITIZEN SCHOOLS

In the spring of 2002, the SNI Division launched a new Citizen Schools apprenticeship titled Erase
the Hate. The Erase the Hate apprenticeship focused on helping students from the Grover Cleveland
Middle School to recognize and respond to issues of stereotyping, bullying, hate, harassment, and tolerance.
Students also focused on media literacy and developing basic conflict resolution skills. The apprenticeship
culminated in the development of a poster created by the students as a way in which to educate others
about the important issues addressed in the apprenticeship. The poster was displayed at a presentation
hosted by the students at Attorney General Tom Reillys Office on May 15, 2002 and distributed in the
community.

(]2

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

LAWRENCE AND METHUEN WEED AND SEED SITES

The Cities of Lawrence and Methuen are two newly recognized Weed and Seed sites coordinated by
the respective police departments of each city. As experienced administrators of Weed and Seed in Grove
Hall, the Attorney General's Office provided technical assistance to these sites as requested. At the end of
Fiscal Year 2002, the Attorney General's Office was invited to serve on the steering committees of each
site. An SNI development coordinator will represent the Attorney General on the steering committees
and in the coming year, will look toward bringing resources of the Attorney General's Office to support
the efforts of these new initiatives.

RE-ENTRY

Having identified a need to support the productive reintegration of formerly incarcerated individuals
back into SNI communities, the SNI Division submitted a request to the Executive Office of Public
Safety for an Edward Byrne Memorial State and Local Law Enforcement Assistance formula grant. The
grant was awarded in July 2002, and the SNI Community Re-Entry Project was launched. The purpose
of the project is to provide offenders with the assistance necessary for them to successfully reintegrate into
their communities with the ultimate goal of decreasing recidivism and increasing public safety. There are
two project components: (1) the Grove Hall component focuses primarily on juvenile offenders, 14 to
21 years old returning to the Grove Hall neighborhood upon release from custody in a Department of
Youth Services (DYS) secure treatment facility; and (2) the Bowdoin-Geneva component focuses on
offenders, 17 to 24 years old, returning to the Bowdoin-Geneva neighborhood following a period of
incarceration at the Suffolk County House of Correction. Both components utilize an enhanced case-
management model and build on partnerships formed through the SNIs in both target communities.
Project partners underwent extensive planning during the fall, and two project coordinators (one for each
component) were hired in December. The principal partners coordinating with the Office of the Attorney
General on the Grove Hall component are: DYS, Roxbury Youthworks, Inc., and the Boston Police
Department. The principal partners coordinating with the Office of the Attorney General on the Bowdoin-
Geneva component are: The Suffolk County Sheriff's Department, Community Resources for Justice,
the Boston Police Department, the Dorchester District Court Probation Department, and the Suffolk
County District Attorney's Office.

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

SNI JOBS FOR YOUTH

One of the major SNI Division efforts aimed at prevention and intervention is the SNI lobs for
Youth . The program, which started in 1996, has grown from employing 23 youth in five communities
to employing more than 90 young people in nine communities throughout the Commonwealth, jobs
for Youth sites offer job opportunities throughout the year and are not limited to summer employment.
Each of the lobs for Youth sites is described below.

Boston Sixteen youth from SNI target areas in Grove Hall and Dorchester were employed
through the City of Boston's Community Centers (BCC) program during this fiscal year.
Partnering with local businesses and agencies, BCC placed young people in a variety of locations,
allowing them to learn skills including entrepreneurship, leadership, and civic duty. The goal was
to provide employment opportunities, hands-on training, safe havens, and adult support.
Placements included local community centers, private businesses, and neighborhood social services
agencies.

Holyoke Holyoke's lobs for Youth program is administered by the Holyoke Youth Alliance,
which serves youth from low-income neighborhoods, particularly in downtown Holyoke. This
program reinforces literacy skills, education, and responsible work behavior, and placed six youth
ages 13-17 during the year. Youth assisted as readers and mentors, and read to young children at
sites including family shelters and after-school programs.

Worcester The lobs for Youth program in Worcester, run by the YMC A of Greater Worcester,
serves at-risk youth in the Worcester area. Twenty youth, ages 15-19, participated during the year
and were employed as computer tech assistants, office assistants, camp counselors, and peer leaders.
The participants also completed a 36-hour employment training program and performed 100
hours of volunteer work.

Brockton The Old Colony YMC A in Brockton just completed its sixth year as a Jobs for Youth
site. The program serves teens in the Brockton area who are enrolled in school or another
educational program. The program's goal was to provide job opportunities, educational trainings,
and recreational activities. This fiscal year the program employed three teens ages 1 7- 1 8 in a local
after-school community center.

Lynn Lynn's program is administered by the Community Minority Cultural Center and serves
disadvantaged and at-risk youth. During this fiscal year, the program employed five teens who
worked in various positions, including after-school programs and community arts programs.

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

Taunton Six youth ages 16-18 were placed through the Taunton Department of Human Services
during this fiscal year. The youth were assigned to various city agencies, including the Taunton
Public Schools, Taunton Public Library, and Head Start. The program's goal is to provide
employment and educational opportunities to youth for skill-building and future employment
capability.

Springfield The Springfield SNI Tobs for Youth program is administered through the Springfield
Southwest Community Health Center and serves youth from low-income families. Seven youth
ages 13-18 participated this fiscal year. The program provided youth with opportunities to
increase their employability, self-esteem, and knowledge and skills in the area of health promotion.
The youth were employed as peer health educators. Youth participated in delivering health
education information, including violence prevention, to other youth at local community centers,
the Salvation Army, and other social service agencies.

New Bedford Twelve at-risk youth in New Bedford received training through the University of
Massachusetts/Dartmouth Division of Continuing Education. The goal of the program was to
provide training and support for youth to become employed or to continue their education.
Internship placements included local businesses, courthouses, colleges, social service agencies, and
the City of New Bedford.

Chelsea This year Chelsea marked its seventh year as a lobs for Youth site. The City of Chelsea
administered the program and provided positions for five Chelsea teens at several area businesses
and city agencies, including the Chelsea Public Library and Chelsea Cable TV. In addition to
employment, the program offered opportunities for recreational team building and for helping
the youth develop skills to choose challenging careers.

BYRNE MEMORIAL GRANTS

In June, the Attorney General's Office SNI Division was pleased to learn from the Massachusetts
Executive Office of Public Safety Programs Division that we were being awarded continuation funding
for the YES Project and the SNI Community Re-Entry Project as well as four new Edward Byrne
Memorial State and Local Law Enforcement Assistance formula grants for Fiscal Year 2003. All projects
involve collaboration with a variety of law enforcement, court-based, and community partners. The
three new projects are described briefly below.

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

Diversity and Cultural Competency for Court Personnel This project involves developing
and presenting a series of lunchtime workshops designed to increase court personnel awareness of
general concepts of diversity as well as help them become familiar with the various cultural
backgrounds, customs, traditions, and practices of the diverse populations served by the court.
The second component involves developing and conducting a series of workshops designed to
give diverse citizens of Plymouth County opportunities to learn about the Massachusetts Trial
Court System. This project will complement activities of the Brockton SNI.

Generating New Capacity for Crime Prevention Projects This project will involve developing
and facilitating workshops for small community-based organizations to help them bolster their
capacity to build meaningful collaborations with law enforcement entities in order to plan effective
programs and to develop fundable projects. This project will be geared to organizations serving
the Grove Hall and Dorchester SNI target areas and those serving the communities of Lawrence
and Methuen.

Lawrence/Methuen Arlington Safe Neighborhood Initiative Community Prosecutor This
project will fund an Assistant Attorney General to work as a special assistant district attorney
assigned to the Essex County District Attorney's Office to prosecute cases arising out of the
Lawrence and Methuen Weed and Seed target areas. The prosecutor will also participate in
community efforts associated with the Weed and Seed activities.

Dorchester Safe Neighborhood Initiative Youth and Family Project This project will build on
the successful efforts and working relationships developed over the years with Dorchester SNI
partners. Among the focuses for this project are concentrated truancy prevention, the provision
of supervised recreational opportunities, and regular meetings with agencies and workers serving
the diverse ethnic populations of youth in the neighborhood.

OUTREACH, EDUCATION, AND TRAINING

The philosophy of the SNI is predicated on partnering with community stakeholders to enhance
public safety and quality of life for neighborhoods. As such, all SNI staff regularly participate in formal
and informal outreach activities to solidify existing working relationships as well as to build new ones.
Some of these outreach activities are alluded to in the Significant Initiatives, Efforts, and Activities section
of the SNI Division's report. For example, the Brockton SNI Community Liaison participates in numerous

COMMUNITY-BASED JUSTICE BUREAU SAFE NEIGHBORHOOD INITIATIVE DIVISION

community committees, and SNI Division staff telephoned and/or met with numerous community
stakeholders to enlist their support and participation in the development of the new Orange SNI.

With regard to training, SNI staff have facilitated training in communities across the Commonwealth.
Two examples are listed below.

• In coordination with the Attorney General's Office Public Protection Bureau and our partners in
the Grove Hall SNI, the SNI Division planned and implemented a half-day seminar on Elder
Fraud and Abuse attended by nearly 200 seniors from the Grove Hall SNI target area.

• In the spring of 2002, the SNI Senior Development Coordinator was a presenter at the annual
LECC conference sponsored by the U.S. Attorney's Office. Her presentation was on the principles
of the national Weed and Seed strategy and tips for law enforcement agencies seeking to build
collaborations to obtain official recognitions as a Weed and Seed site.

Additionally, SNI staff participated in staff and program development training. For example:

• The SNI Prosecutor for the Northwestern District attended the community prosecution program
offered by the National District Attorney's Association in Columbia, South Carolina.

• In September and October 2001 , with a resident from the Grove Hall SNI target area, a police
department representative, and a community agency representative, the SNI Senior Development
Coordinator participated in a mandatory eight-day accreditation training sponsored by the
Executive Office for Weed and Seed.

CRIMINAL BUREAU

Appellate Division

High Tech and Computer Crime Division

Public Integrity Division

Victim /Witness Assistance Division

Special Investigations and Narcotics Division

Economic Crimes Division

Environmental Crimes Strike Force

Financial Investigation Division

Consumer Protection Prosecution Unit

Central Artery/Tunnel Project

CRIMINAL BUREAU

Criminal Bureau

The primary mission of the Criminal Bureau is to prosecute violations of state criminal laws resulting
in or involving significant economic loss or injury; harm to the environment; misconduct by public
employees or elected officials; crimes against public agencies; organized crime; drug trafficking; crimes
involving computers and other forms of technology; and cross-jurisdictional criminal organizations. The
Criminal Bureau also prosecutes criminal cases referred to it by District Attorneys' Offices and cases that
further priorities of the Attorney General, such as crimes against children, the elderly, and other particularly
vulnerable groups.

The majority of criminal cases prosecuted by the Criminal Bureau result from investigations conducted
by police officers and investigators assigned to the Criminal Bureau. During Fiscal Year 2002,
approximately 25 State Police Officers, four officers of the Environmental Police, and eight civilian
Criminal Investigators were assigned to the Criminal Bureau. Additionally, in some instances, law
enforcement officers from other local, state, and federal agencies participated in investigations conducted
by the Criminal Bureau.

Another mission of the Criminal Bureau is to promote effective law enforcement and criminal justice
in the state. The Criminal Bureau accomplishes this mission by maintaining partnerships with the
Massachusetts District Attorneys Association, the Massachusetts Chiefs of Police Association, the Executive
Office of Public Safety, and other law enforcement agencies and associations; developing criminal justice
policy; proposing legislation; and participating in training programs for prosecutors, police officers, judges,
and others involved in the criminal justice system.

Assistant Attorneys General assigned to the Criminal Bureau represent the Commonwealth in criminal
prosecutions throughout the state, handle proceedings in state and federal courts challenging criminal
convictions, and represent prosecutors, judges, and other state criminal justice employees who are sued in
the performance of their duties. During Fiscal Year 2002, the Criminal Bureau received more than 1 ,408
inquiries and complaints from citizens, and reviewed 138 rendition and extradition requests forwarded
to it by the Executive Office of the Governor.

The Criminal Bureau is organized into the following divisions and units, each of which reflects an
area of specialization and expertise: Appellate, High Tech and Computer Crime, Public Integrity, Victim/
Witness Assistance, Special Investigations and Narcotics, Economic Crimes, Environmental Crimes Strike
Force, Financial Investigation, Consumer Protection and Prosecution Unit, and Central Artery /Tunnel
Project.

CRIMINAL BUREAU

In addition to these divisions, the Criminal Bureau contains the Consumer Protection Prosecution
Unit, which is staffed by a senior prosecutor, David Cosgrove, who reports directly to the Deputy Chief
of the Criminal Bureau and an experienced fraud investigator. The Criminal Bureau also contains the
Director of the Central Artery /Tunnel Project, who coordinates criminal investigations and prosecutions
of individuals, contractors, and corporations alleged to have engaged in criminal law violations on the
Central Artery/Tunnel Project.

At the close of Fiscal Year 2002, the Criminal Bureau prepared for a restructuring of the bureau to be
implemented at the outset of Fiscal Year 2003. As part of the restructuring, the Criminal-Based Justice
Bureau will merge with the Criminal Bureau, resulting in the addition of two new divisions to the
Criminal Bureau roster, the Safe Neighborhood Initiative Division and the Victim Compensation and
Assistance Division; a new division, the Criminal Justice Policy Division, will be formed; and the three
white-collar crime divisions — the Public Integrity, Economic Crimes, and High Tech and Computer
Crime Divisions — will be merged into a single division, the Corruption, Fraud & Computer Crimes
Division. The foregoing restructuring was designed to more efficiently service criminal matters handled
by the Attorney General's Office and reflects the Office's desire to enhance the professional development
of Criminal Bureau AAGs and need to accommodate the staff reduction caused by uncertain economic
times.

The Chief of the Criminal Bureau is Kurt Schwartz. The Deputy Chief of the bureau is Michele
Adelman. The Division Chiefs within the Criminal Bureau during Fiscal Year 2002 were: William
Meade, Appellate Division; John Grossman, High Tech and Computer Crime Division; Pamela Wechsler,
Public Integrity Division; Kathleen Morrissey, Victim/Witness Assistance Division; William Bloomer,
Special Investigations and Narcotics Division; Carol Starkey, Economic Crimes Division; Paul Molloy,
Environmental Crimes Strike Force; Paul Stewart, Financial Investigation Division; Detective Lieutenant
Mark Delaney and thereafter Lieutenant Steve Matthews of the Massachusetts State Police, Criminal
Investigation Division; and Nancy Bloomberg, Central Artery/Tunnel Project.

The Criminal Bureau also had three bureau attorneys during Fiscal Year 2002. Mary Phillips, Bureau
Attorney for Training and Administration, coordinated the Attorney General's Grand Jury process
throughout the Commonwealth, developed training programs for the Criminal Bureau, served as the
Chair of the Training Committee for the Office of Attorney General Tom Reilly, and advised the Bureau
Chief on administrative and budgetary matters. James O'Brien, Bureau Attorney for Policy and Legislation,
developed and coordinated criminal justice initiatives, and reviewed and drafted legislation affecting the
criminal justice system. David Cosgrove, Bureau Attorney for Consumer Protection Matters and liaison
to the Public Protection Bureau, investigated and prosecuted criminal consumer complaint cases, including

CRIMINAL BUREAU APPELLATE DIVISION

cases involving home improvement contractor fraud, telemarketing and charitable solicitation scams,
and economic crimes against vulnerable communities such as immigrants and the elderly.

APPELLATE DIVISION

The Appellate Division handles a wide variety of criminal, federal habeas corpus, state habeas corpus,
and other civil cases that impact criminal prosecutions and the criminal justice system. The division's
caseload includes appeals and post-conviction matters in criminal cases prosecuted at the trial level by the
Attorney General's Criminal Bureau and from convictions of criminal contempt throughout the
Commonwealth; all habeas corpus petitions filed in federal court that challenge Massachusetts convictions,
parole surrenders, civil commitments, and renditions; and appeals in the First Circuit Court of Appeals
from the denial or granting of habeas corpus relief. The division also engages in civil litigation defending
judges, clerks, probation officers, and other court personnel, district attorneys, assistant district attorneys,
and other prosecutorial personnel sued civilly in state or federal court for acdons taken during the criminal
justice process. The assistant attorneys general in the division defend the constitutionality of criminal
statutes, as well as other statutes, court rules, practices, and procedures that concern all aspects of the
criminal justice system; represent the interests of prosecutors when subpoenaed to testify or provide
documents in federal civil cases; supervise agency staff attorneys handling litigation involving the
Department of Correction, the Parole Board, and the Commission of Probation; and handle appeals and
federal court litigation concerning the Parole Board.

In addition to their casework, division attorneys provide assistance to other Criminal Bureau attorneys
on investigations, motions, trials, post-conviction proceedings, and single justice actions, and consult
with or assist other bureaus in matters where the criminal justice expertise or perspective is important.
The division also works closely with the District Attorneys' Offices, especially their Appellate Divisions,
in identifying and acting as a clearinghouse on criminal law issues of statewide importance and interest.

The Appellate Division files approximately 60 appellate briefs per year in the United States Supreme
Court, Court of Appeals for the First Circuit, Supreme Judicial Court, and Massachusetts Appeals Court.
The division files 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. The division also files in the United States
District Court approximately 1 20 substantive memoranda of law per year in opposition to federal habeas
corpus petitions.

CRIMINAL BUREAU APPELLATE DIVISION

The Appellate Division included William Meade, Division Chief; James Arguin; Eva Badway; Annette
Benedetto; Thomas Dee; Maureen Giacoppo; Dean Mazzone; Cathryn Neaves; and Linda Wagner.

SIGNIFICANT CASE SUMMARIES

• Trevor Neverson v. Lynn Bissonette (First Circuit) Appeal from the dismissal of a time-
barred federal habeas petition challenging petitioner's 1990 Hampden County manslaughter
conviction. On August 20, 2001, the order of dismissal was affirmed.

• Charles Delaney v. Tames Matesanz (First Circuit) Appeal from dismissal of federal habeas
petition challenging Plymouth County second degree murder conviction raising statute of
limitations issue. On September 5, 2001 , the judgment of the district court was affirmed.

• Hung Tan Vo v. Michael Maloney (First Circuit) Appeal from denial of federal habeas
petition challenging Middlesex County first-degree murder conviction on the grounds of ineffective
assistance of counsel and erroneous jury instructions. On September 24, 2001, the judgment of
the district court was affirmed.

• Mark A. Klbbe v. Larry E. DuBois (First Circuit) Appeal by Commonwealth from district
court decision granting federal habeas petition challenging Hampden County arson conviction.
On October 23, 200 1 , the judgment of the district court granting the writ was reversed and the
conviction was reinstated.

• Commonwealth v. Jeffrey Manlff (Appeals Court) Appeal from Attorney General's Office
prosecution and conviction of defendant for multiple counts of larceny from two 90-year-old
victims. On December 20, 2001, the convictions were affirmed.

• Charles Fryar v. Lynne Blssonnette (United States District Court) Federal habeas petition
challenging Hampden County conviction for second-degree murder on grounds of errors in the
jury selection process and exclusion of exculpatory evidence. On February 5, 2002, the petition
was denied.

• GLAD, et al v. Thomas F. Reilly. et al. (Supreme Judicial Court) Civil action seeking a
declaration that G.L. c. 272, §§ 34 and 35 (sodomy and unnatural acts statutes) were

CRIMINAL BUREAU APPELLATE DIVISION

unconstitutional on their face and that an injunction should issue against their enforcement by
the Attorney General and District Attorneys of Suffolk and Middlesex counties. On February
21, 2002, the Supreme Judicial Court dismissed the complaint and entered judgment for the
Attorney General.

• Commonwealth v. Richard Pimental (Appeals Court) Appeal from Attorney General's
Office prosecution and conviction for larceny of a firearm by a police officer administering the
Taunton Police Department gun buyback program. Judgment affirmed on March 27, 2002.

• Sean Fabre v. Amalia Walton (Supreme Judicial Court) Appeal on reserve and report from
aG.L. c. 211, §3 petition seeking relief from a denied special motion to dismiss a SLAPP suit
brought by respondent against his former girlfriend in retaliation for her receiving a 209A order
against him. On April 12, 2002, the Supreme Judicial Court created at our urging a right of
interlocutory review of special motions to dismiss SLAPP suits and reversed the denial of Walton's
special motion to dismiss.

• Paul Gunter v. Michael Maloney (First Circuit) Appeal from a decision of the district court
granting a federal habeas petition which challenged a Suffolk County first-degree murder conviction.
On April 29, 2002, the judgment of the district court was reversed and the conviction was
reinstated where the petitioner's merged felony claim and the Supreme Judicial Court's resolution
of it were procedurally defaulted.

• Lonnle Watkins v. Paul Murphy (First Circuit) Appeal from the denial of a federal habeas
petition challenging 1994 Suffolk County convictions for two counts of first-degree murder and
armed robbery. Judgment was affirmed on June 1 1 , 2002.

CRIMINAL BUREAU

APPELLATE DIVISION

• Johnny Stephens v. Timothy Hall (First Circuit) Appeal from the allowance of a federal
habeas petition from 1993 Suffolk County convictions for unarmed robbery and ABD W claiming
ineffective assistance of counsel. On June 28, 2002, the judgment of the district court was
reversed and the petitioner's convictions were reinstated.

STATISTICAL SUMMARY

CASES CASES PENDING TOTAL CASES

OPENED DISPOSED CASES HANDLED

A. Federal Habeas

153

244

469

B. Federal Civil

C. State Civil

D. State Habeas

E. Criminal

F 211 §3 and Other

Single Justice Cases

G. Other

TOTAL

238

432

113

783

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

In addition to the large caseload handled by the division, the division became involved in a number
of significant initiatives. Among these efforts were the following:

• Massachusetts Bar Association Appellate Bench / Bar Committee

• Supreme Judicial Court's / Appeals Court's Information Technology Advisory Committee

CRIMINAL BUREAU HIGH TECH AND COMPUTER CRIME DIVISION

• Co-Chair of AGO's Diversity Committee

• Massachusetts Bar Association, Judicial Administration Task Force, Project Advisory Group

• Rendition point person for Criminal Bureau

• Member of the Lawyer's Committee for Civil Rights Board of Directors

• Elder Task Force

• Clerk, American Middle Eastern Lawyers Association

• Paul McLaughlin Center, Volunteer Reader

OUTREACH, EDUCATION, AND TRAINING

The Appellate Division devoted a substantial amount of energy and resources to training and outreach.
These efforts included the following:

• Massachusetts District Attorneys Association Conference

• Commonwealth Appellate Attorneys Action Project

• Lecturer and Clinical Coordinator at Harvard Law School

• Guest Lecturer, Suffolk University Law School

• MCLE Faculty Panelist, Representing Indigent Parties in Federal Court

• Articles Editor, Massachusetts Law Review

• Associate Editor, Massachusetts Law Review

HIGH TECH AND COMPUTER CRIME DIVISION

The mission of the High Tech and Computer Crime Division (HTCC) is to provide high-tech law
enforcement expertise to the Commonwealth. In doing so, we serve three constituencies:

1. The individual citizens of the Commonwealth, particularly the children, who are increasingly
communicating, buying and selling, and just passing time on the Internet;

CRIMINAL BUREAU HIGH TECH AND COMPUTER CRIME DIVISION

2 . The businesses and universities of the Commonwealth that drive our knowledge-based economy
and that are dependent on computers and the Internet; and

3. Other law enforcement agencies (as well as other divisions within the Office of the Attorney
General) that rely on our expertise to support them in the full range of crimes that they investigate
and prosecute, from homicide to narcotics trafficking.

We serve these three constituencies in three inter-related ways:

1 . Investigation and prosecution of cases in which computers or the Internet plays a crucial role;

2. Investigative, legal, and computer forensics support to other law enforcement agencies; and

3. Education, outreach, and policy development.

The HTCC handles a wide variety of cases in which computer technology or the Internet plays a
crucial role. The two areas of focus are preserving the integrity of the Commonwealth's knowledge-based
economy and protecting the well-being of our children. The first category of cases includes intrusions to
computer systems, related extortion attempts, theft of trade secrets and other intellectual property, such
as trademarks and domain names, and the most egregious attempts to undermine the nascent Internet
economy by defrauding consumers. The second category includes targeting child sexual predators on the
Internet, dissemination and possession of child pornography, and Internet threats to public institutions,
such as schools.

HTCC included John Grossman, Division Chief; Jennifer Austin; Trooper David Crouse; Trooper
Steve Fennessy, Ursula Knight; Investigator Eric Lundberg; Trooper Matthew Murphy; Lieutenant Dermot
Quinn; and Julie Ross.

SIGNIFICANT CASE SUMMARIES

• Commonwealth v. Adam Lewis and Commonwealth v. Michael Dewhurst (Gardner and
New Bedford District Courts) Both of these cases involved Internet auction fraud. In the Lewis
case, the defendant collected money from over 100 people around the country for computer
equipment he advertised but never delivered. In the Dewhurst case, the defendant collected
between $2,500 and $6,000 from each of the people, over 20, that he conned by promising
them high-definition televisions. Each man pleaded guilty to larceny by a continuous scheme.
Lewis was sentenced to two years in the House of Correction, with a year to serve and the balance
suspended for three years. Dewhurst was sentenced to two and one half years in the House of

CRIMINAL BUREAU HIGH TECH AND COMPUTER CRIME DIVISION

Correction, with six months to serve and the balance suspended for three years. Each was ordered
to pay restitution.

• Commonwealth v. Anthony DiPrlzio (Falmouth District Court) The defendant hacked
into the Falmouth High School computer system and Web site and downloaded various
confidential files, including student medical records. He pleaded to sufficient facts and received
a two-year continuance without a finding and was ordered to perform 150 hours of community
service and pay a $ 1 ,000 fine.

• Commonwealth v. Jeffrey Walls (Essex County Superior Court) HTCC began an
investigation of the defendant based on information that he had downloaded child pornography
to his work computer. During the course of the investigation, the HTCC team discovered that
the defendant had allegedly engaged in sexual activity with a young boy on numerous occasions
between the victim's fifth and eighth birthdays. State Police also identified a second young boy
whom the defendant also allegedly sexually assaulted on several occasions. The defendant faces
one count of rape of a child under 1 6 , two counts of indecent assault and battery on a child under
14, and possession of child pornography charges. This case is now scheduled for trial.

• Commonwealth v. Nancy Jane McDonald (Cambridge District Court) At the height of
the anthrax mailings in the fall of 2001, ENDECA, a Cambridge-based high-tech business,
received a number of anthrax-related threats on their Web site. They initially reported to local
law enforcement but did not receive a strong response. On Friday, October 19, the victim
contacted the High Tech and Computer Crime Division. By that evening, we had identified the
source of the threats and executed a search warrant, seizing a computer. On Tuesday, October 23,
Nancy Jane McDonald surrendered to the Cambridge District Court to face charges of threats to
commit a crime and assault. This case is now scheduled for trial.

CRIMINAL BUREAU

HIGH TECH AND COMPUTER CRIME DIVISION

STATISTICAL SUMMARY

The following chart summarizes the case referrals that HTCC screened for possible investigation and
prosecution during Fiscal Year 2002 and the number of those referrals that matured into formal
investigations.

CASE DESCRIPTION

NUMBER OF
REFERRALS

Theft of Trade Secrets and 8
Other Intellectual Property

Computer Intrusions 16

Consumer Fraud 247

Child Exploitation 27

Threats/Cyberstalking 50

Unsolicited E-Mail or SPAM 22

Purchase of Explosives/Illegal Goods 2

Other 5

NUMBER OF CASES
OPENED

TOTAL

377

In the past year, HTCC received an extraordinarily high number of consumer fraud complaints; this
reflects in part the severity of the problem and in part the ongoing success of the Internet Fraud Complaint
Center (IFCC), a joint project of the National White Collar Crime Center (of which the Attorney
General's Office is a member) and the FBI to consolidate all such complaints in one database. The center
refers to HTCC every complaint that either concerns a Massachusetts target or is received from a
Massachusetts victim. HTCC then screens the referrals and targets the most compelling cases, most of
which involve targets in the Commonwealth who have defrauded a substantial number of people. The

CRIMINAL BUREAU HIGH TECH AND COMPUTER CRIME DIVISION

remaining IFCC cases are referred to the Public Protection Bureau's Consumer Protection Division for

During Fiscal Year 2002, HTCC charged 13 individuals with various crimes, including unauthorized
access (computer hacking) , statutory rape, threats to commit a crime, identity fraud, criminal harassment
and dissemination of child pornography Eleven people pleade guilty or otherwise admitted to sufficient
facts in Superior or District courts across the Commonwealth. 1 HTCC prosecutors also worked on
cases outside of the subject matter of computer crimes. For example, one prosecutor obtained a conviction
in a homicide, Commonwealth v. Osca Urrea . as a Special Assistant District Attorney for Suffolk County,
and another prosecutor obtained a guilty plea in a narcotics case. In addition, one HTCC prosecutor
spent four months in Roxbury District Court handling cases for the Grove Hall Safe Neighborhood
Initiative.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

In addition to the cases that we investigated and prosecuted within HTCC, the division assisted
other divisions within the Attorney General's Office and District Attorneys' Offices in over 65 separate
matters. In some cases, this assistance consisted of legal advice and reviewing search warrants; in others, of
performing computer forensics. This year, for the first time, the forensics not related to HTCC cases
were almost exclusively related to other cases from throughout the Attorney General's Office, including
the Special Investigations and Narcotics, Insurance Fraud, and Medicaid Fraud Divisions.

HTCC has historically been very involved in encouraging and coordinating efforts between the
public and private sectors to promote Internet and computer security. The importance of these efforts
was further emphasized by the events of September 1 1 , 2001 . In the time since, members of the division
have spent substantial time and effort serving in organizational capacities for Infragard Boston — the
National Infrastructure Protection Center's public/private outreach program — and the Anti-Terrorism
Task Force's Public/Private Working Group. They have also taken a lead role in convening representatives
of the President's Critical Infrastructure Protection Board, the U.S. Department of Commerce's Critical
Infrastructure Assurance Office, Harvard's Kennedy School, the MITRE Corporation, the
Commonwealth's Information Technology Division, various industry interest groups (such as the ISSA
and the Internet Alliance) , private businesses, and others to define the state's role in defending the cyber -
infrastructure.

'Some of the cases charged this year remain pending, just as some of the cases resolved this year were charged previously.

CRIMINAL BUREAU PUBLIC INTEGRITY DIVISION

Finally, HTCC prosecutors worked closely with staff from the Executive Bureau to research, draft,
and promote various legislative changes demanded by changes in technology. The changes included a
technical amendment to the definition of child pornography to ensure that it included digital pictures; a
new terroristic threats law that would adequately punish a defendant for the harm done when threatening
a large group of people with profound harm, a form of threat often promulgated over the Internet; an
update of the hacking laws', and changes to the administrative subpoena statute that would assure that
local law enforcement has the tools to protect its constituencies from computer crime.

OUTREACH, EDUCATION, AND TRAINING

HTCC devoted a substantial amount of energy and resources to training and outreach. These efforts
allowed us to leverage our relatively limited resources to (a) teach people and institutions to avoid becoming
victims of high tech crimes and (b) where we cannot prevent the crimes from happening, assure that law
enforcement has the capacity to respond.

Among the highlights in this area over the last year were:

• Participation in a number of law enforcement training conferences, including meetings of the
Southeastern Massachusetts Computer Crimes Task Force (REACCT) and the High Tech
Criminal Investigators Association.

• Safe and Ethical Internet Use presentations made at schools around the Commonwealth to students,
parents and educators, including the Abigail Adams Middle School in Weymouth and the Paul
McLaughlin Center in Dorchester.

We also participated in various training programs to assure that we remain current in the dynamic
field of computer crime. A highlight was the presentation that Genuity created for HTCC to brief our
prosecutors and investigators on the emerging Voice Over LP. technology that allows telephone calls to
be routed over the Internet.

PUBLIC INTEGRITY DIVISION

The primary mission of the Public Integrity Division (PID) is to investigate and prosecute crimes
committed by and against public employees that compromise the public's confidence in government or
harm public agencies. In Fiscal Year 2002, prosecutions included crimes committed against state and

CRIMINAL BUREAU PUBLIC INTEGRITY DIVISION

local public agencies and government-funded organizations, as well as crimes committed by government
employees, agents, and contractors.

Members of the Public Integrity Division investigate cases with the assistance of Massachusetts State
Police troopers and forensic financial investigators assigned to the Criminal Bureau. In addition, division
attorneys often work with local police departments, other State Police Officers, federal law enforcement
officials, and investigators assigned to other government agencies. The Public Integrity Division maintains
close working relationships with other state and federal agencies involved in either investigating crimes by
and against public employees and agencies, or enforcing laws concerning the conduct of public employees
and agencies. These agencies include the State Ethics Commission, the Department of Revenue, the
Office of the State Auditor, the Office of the Inspector General, the United States Attorney's Office, the
Federal Bureau of Investigation, the Federal Department of Transportation, the Federal Postal Inspectors,
Local District Attorneys' Offices, various retirement boards, local town counsels, and city solicitors'
offices.

Members of the division for all or part of Fiscal Year 2002 included: Pamela Wechsler, Division
Chief, Eugenia Carris; Patrick Lee; Phil McGovern; Nancy Rojas; Frank Russo; and Kim West.

SIGNIFICANT CASE SUMMARIES

• Commonwealth v. Walid Mobarak (Suffolk Superior Court) This case involved widespread
government corruption within the Boston Police Department's Hackney Unit. The Office of the
Attorney General joined with Boston Police Department detectives, Federal Bureau of Investigation
agents, and members of the United States Attorney's Office to prosecute this matter in state and
federal courts. The Public Integrity Division prosecuted four individuals, including Walid
Mobarak. Mobarak was a cooperating government witness who acted as a middleman between
unqualified taxi applicants and Boston Police Department officials by delivering bribes to Boston
Police officers in exchange for the issuance of taxi licenses. Mobarak pleaded guilty to five counts
of Bribery and was sentenced to two years probation.

• Commonwealth v. Percy Wayne Martin (Suffolk Superior Court) Percy Wayne Martin
stole confidential identification information from over a dozen people, all with the surname
Martin. He used the information to make false identification cards, take out loans, and open
credit accounts. He stole approximately $75,000. Martin pleaded guilty to multiple counts of

CRIMINAL BUREAU PUBLIC INTEGRITY DIVISION

Identity Theft, Larceny, Forgery, Uttering, and Bank Fraud. He was sentenced to serve not more
than two and not less than three years in State Prison.

• Commonwealth v. Eileen Stocker (Suffolk Superior Court) Eileen Stocker entered local
elementary school classrooms and stole wallets from teachers. She then withdrew money from
their bank accounts, cashed stolen checks, and charged items on stolen credit cards. She pleaded
guilty to Forgery, Uttering, Larceny, and Identity Theft and was sentenced to five years probation
and $5,000 restitution.

• Commonwealth v. Shannon Gordon and )ohn Hodnett (Suffolk Superior Court) Shannon
Gordon, a Boston Public School Department administrator, and her boyfriend John Hodnett
abused Gordon's position as a public employee. Specifically, they created a phony day care center
account in order to fraudulently receive funds that had been allotted to provide childcare and
educational services to low-income preschoolers. Both defendants pled guilty and were sentenced
to 18 months probation, restitution of $22,000, and 400 hours community service.

• Commonwealth v. Jeanna Monterio (Barnstable District Court) Jeanna Monterio was a
clerk in the Barnstable Superior Court's Probation Department who stole more than $8,000 of
probation monies. Monterio pled guilty to Larceny and was sentenced to two years supervised
probation. She was ordered to have no direct dealings with any monies or finances and to pay
$8,018 in restitution.

• Commonwealth v. John Kennedy (Fitchburg District Court) John Kennedy was charged
with attempting to solicit sex via the Internet from an undercover trooper who was posing as a
15-year-old girl. The defendant pled guilty to Attempting to Pose as a Minor, Attempting to
Disseminate Harmful Matter to a Minor, and Possession of Child Pornography. He was sentenced
to two and one half years in the House of Correction with 30 days to serve and five years
probation (the first five months of probation under house arrest), to undergo sex offender
treatment, to have no unsupervised contact with children, and to have limited access to computers.

• Commonwealth v. Etteh Akpanoluo (Roxbury District Court) Etteh Akpanoluo pleaded
guilty in the Roxbury District Court to Larceny by Embezzlement. The defendant ran a local
state-funded agency that provided de- leading programs for low-income residents. He embezzled
$48,000 from an escrow account. The case was Continued Without a Finding, and the defendant
was placed on probation for five years and ordered to pay $48,000 restitution. Co-defendant,
Adeyeye Anjorin, fled to Nigeria and is in default.

CRIMINAL BUREAU PUBLIC INTEGRITY DIVISION

• Commonwealth v. Efraine Rivera (Middlesex Superior Court) This was a jury-waived
trial. Efraine Rivera was a former Lowell District Court Probation Department translator who
had been accused of accepting bribes from an informant. The defendant was acquitted of Bribery.

• Commonwealth v. Steven Berry (West Roxbury District Court) Steven Berry was a conflict
case from the Suffolk County District Attorney's Office. Berry became violent in South Boston
District Court during a probation hearing when he threatened several people, broke a door frame,
and assaulted court personnel. The defendant pled guilty to Assault and Battery, Malicious
Destruction of Property, Threats, and Disruption of Court Proceedings. He was sentenced to
serve two years in the House of Correction.

• Commonwealth v. Lawrence Shetler (Suffolk Superior Court) Lawrence Shetler was the
President of a Cambridge engineering firm who submitted a falsified bid on a Central Artery/
Tunnel Project contract. Shetler was charged with Procurement Fraud in 1995 and had been in
default. He was placed on pre-trial probation for two years, ordered to perform 400 hours of
community service, and barred from bidding on state contracts for five years. Shetler had been
planning to run for Lieutenant Governor of Rhode Island but withdrew from the race when
newspapers reported on the matter.

• Commonwealth v. Lee Robinson (Springfield District Court) Lee Robinson submitted a
false bid on behalf of a company to the Town of East Longmeadow for a security system in a new
middle school. He then submitted a lower bid on behalf of ADT Security in order to receive the
contract. He was charged with Procurement Fraud, Forgery, and Uttering a Forged Instrument.
He admitted to sufficient facts and received a CWOF for one year $ 1 ,500 fine, $500 court costs,
S60 victim witness fee, and 20 hours of community service at a nonprofit agency. He was also
prohibited from directly engaging in negotiations or bidding on government contracts for the
duration of his probation.

• Commonwealth v. James Mills (Middlesex Superior Court) James Mills, a court-appointed
investigator, had been convicted after a jury trial for multiple counts of Larceny, Perjury, Failure
to File Income Tax Returns, Pension Fraud, and Submitting False Claims. This past year, the case
was reversed in part by the Supreme Judicial Court and remanded for resentencing. Mills was
resentenced to serve not more than four years and not less than four years and one day in State
Prison for Perjury, Procurement Fraud, and Submitting False Claims; one year concurrent in the
House of Correction for Pension Fraud and Failure to File Income Tax Returns; four years probation
from and after for Larceny Over $250; and $100,000 in restitution.

CRIMINAL BUREAU PUBLIC INTEGRITY DIVISION

• Commonwealth v. Yovette Mumford (Suffolk Superior Court) Yovette Mumford faces
multiple counts of procurement fraud and tax charges. The allegations stem from her alleged
activities as the President of a company that secured a contract with the Central Artery/Tunnel
Project (CA/T) for Big Dig electrical inspection services. Mumford is alleged to have billed the
Big Dig for over $80,000 in personal expenses that were unrelated to the work she was doing for
the Project and not to have paid the Commonwealth the withholding taxes she held back from
her employees' compensation. This criminal case remains pending at the close of the fiscal year.

STATISTICAL SUMMARY

Opened Investigations 187

Charged in District Court 9

Indicted in Superior Court 1 3

Disposed in District Court* 8

Disposed in Superior Court* 7

Closed Cases* 198

* Some were opened in prior fiscal years.

During Fiscal Year 2002, the Public Integrity Division reviewed 187 new referrals of alleged criminal
misconduct and disposed of 1 98 cases (some of which were received in prior fiscal years) . Thirteen cases
were indicted, and 15 cases resulted in guilty pleas. Of the 15 pleas, eight were handled in district courts
and seven were handled in superior courts. There were one superior court trial and nine evidentiary
motions. Four search warrants were executed during the course of Grand Jury investigations.

CRIMINAL BUREAU PUBLIC INTEGRITY DIVISION

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

In addition to the cases that we investigated and prosecuted, division members undertook significant
initiatives. Several division members participated in the Citizens School Mock Trial program. One
division member organized an officewide anti-terrorism lecture tided Islamic Faith & Civil Rights. Other
division members served on a number of officewide committees, including the Hate Crimes Task Force,
the Child Protection Project, the School Violence Project, the Racial Profiling Committee, and the
Employee Benefits Committee. In addition, the Division Chief also became the Criminal Bureau's
member of the Attorney General's Institute (an internal program designed to enhance training to all staff
members) .

OUTREACH, EDUCATION, AND TRAINING

Public Integrity Division attorneys participated in numerous trainings both inside and outside of the
office during Fiscal Year 2002. Among the highlights in this area over the last year were:

• Instructor on Direct and Cross Examination at National Association of Attorneys General training

• Attendance at a weeklong National Association of Attorneys General training on Telemarketing
Fraud

• Preparation of a chapter on Trial Advocacy for a Massachusetts Continuing Legal Education
publication

• Lecturer at a Massachusetts Continuing Legal Education course on Trial Skills

• Certification as a National Institute of Trial Advocacy Trainer

• Trial Adviser at Harvard Law School

• Panelist for an officewide training on Dealing with the Media

• Attendance at a statewide Anti-Terrorism Conference

• Instructor at a two-day AG Institute deposition training

• Attendance at a Procurement Fraud training

CRIMINAL BUREAU VICTIM/WITNESS ASSISTANCE DIVISION

VICTIM / WITNESS ASSISTANCE DIVISION

The Victim/Witness Assistance Division (VWAD) 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 collateral 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). Advocates in the Criminal Bureau provide victim advocacy and
witness management services to all of the bureau's divisions: 1) Appellate; 2) Criminal Investigation; 3)
Economic Crimes; 4) Environmental Crimes Strike Force; 5) Financial Investigations; 6) High Tech and
Computer Crime; 7) Public Integrity; and 8) Special Investigations and Narcotics. Advocates are
occasionally assigned to prosecutions in other bureaus of the Office when the prosecutor identifies the
need for victim/witness services.

The nature of these cases varies depending on the referral source. Advocates also provide victim/
witness coverage on conflict cases referred to the Office by the 1 1 District Attorneys' Offices across the
Commonwealth. These referrals typically involve cases of violent crime. The Victim/Witness Assistance
Division, in an effort to build community partnerships and to address victim issues identified as mandated
priorities of Attorney General Tom Reilly, participates in a number of initiatives relating to children,
safety in our schools, elders, fraud, health care, high tech and computer crime, domestic violence, diversity,
and curative legislation.

During Fiscal Year 2002, VWAD staff included Kathy Morrissey, Director; Helena Dunn; and Kelly
Payne.

SIGNIFICANT CASE SUMMARIES

Six cases of particular note illustrate work in priority areas set by Attorney General Tom Reilly: high
tech and computer crime; elders and fraud; and consumers and identity fraud.

• Commonwealth v. Anthony DlPrizlo (High Tech & Computer Crime Division) On
October 4, 2001, the defendant in the above-captioned case, Anthony DiPrizio, a Falmouth
High School student, admitted to sufficient facts to warrant a finding of guilty before Judge
Michael Creedon in Falmouth District Court to two counts of Unauthorized Access to a
Computer. Judge Creedon continued the defendant's case without a finding for two years and

CRIMINAL BUREAU VICTIM/WITNESS ASSISTANCE DIVISION

placed the defendant on probation for two years to be supervised by the Falmouth District Court
Probation Department. In addition, the defendant was ordered to perform 150 hours of
community service and to pay a fine in the amount of $ 1 ,000. The division provided witness
management on the DiPrizio case and, in order to address safety issues and for purposes of
notification, maintained close contact with the Mashpee Public Schools Superintendent and
Network Administrator as well as the Mashpee High School Principal.

• Commonwealth v. Leo R. Burns and Thomas I. Ribaga (Economic Crimes Division) The
trial of Commonwealth v. Leo R. Burns and Thomas T. Ribaga began on March 12, 2002 before
Judge Gary Nickerson in the Barnstable Superior Court, Barnstable, Massachusetts. On March
15, 2002, the fourth day of trial, both defendants changed their pleas to guilty to all of the
larceny charges against them. Defendant Leo R. Burns pleaded guilty to nine counts of Larceny
Over $250, and defendant Thomas J. Ribaga pleaded guilty to 10 counts of Larceny Over $250.

On March 18, 2002 , Judge Nickerson sentenced the defendant Leo R. Burns to two years in the
House of Correction, one year of the sentence to be served, the balance suspended for nine years
with probation to be supervised by the Barnstable Superior Court Probation Department. Judge
Nickerson also imposed a 10-year term of probation to begin immediately to ensure that any
assets currently held by the defendant Burns would be available for restitution. On the same day,
the defendant Thomas J. Ribaga was sentenced to 10 years probation to be supervised by the
Barnstable Superior Court Probation Department. In addition to being joindy responsible with
Burns for paying restitution to the victims in the amount of $144,838.62, Ribaga was held
individually responsible for paying $ 1 68,000 to two additional victims.

The division provided victim advocacy to the six individuals, including several elders, who were
victimized by and lost money to the defendants. The advocate developed a strong rapport with
the victims by: keeping them notified of the case status; explaining the court process throughout
the duration of the case; and providing court accompaniment. All of the victims took an active
interest in the prosecution of this matter, and several vicdms submitted Victim Impact Statements
that were read at the time of sentencing. Following disposition, the division assisted the victims
with the certification process to apply for notice of Burns' release. The division also coordinated
with the appropriate probation departments to ensure that the victims receive restitution from
both defendants.

• Commonwealth v. Shirley Hoak (Economic Crimes Division) On March 27, 2002, the
defendant, former Cambridge attorney Shirley Hoak, pleaded guilty before Judge Carol Ball in
Middlesex Superior Court to 17 counts of Larceny Over $250 and two counts of Larceny Over

CRIMINAL BUREAU VICTIM/WITNESS ASSISTANCE DIVISION

$250 from a Person Aged 60 or Older. On April 19, 2002, Judge Ball adjudicated the defendant
to be a Common and Notorious Thief and sentenced her to two and one half years in the House
of Correction, committed, with two and one half years probation concurrent with her committed
sentence and 1 years probation from and after her release.

The investigation in this case resulted in the defendant's admission to stealing a total of
approximately SI. 6 million from 14 sets of client victims from July 1997 to August 2001. The
defendant, who was disbarred in July 2001, specialized in debt consolidation. Many of the
defendant's clients had entrusted her with funds to pay their taxes or creditors. In several instances,
the defendant stole funds that clients had given her to invest on their behalf. The defendant
admitted to diverting the bulk of her clients' money to her own personal accounts and using it
for her own purposes, including significant cash withdrawals at casinos and repayments to other
clients. The victims were an elderly Allston retiree, two Cape Cod women who formerly owned
a bed and breakfast, a former Lynn-based corporation, the defendant's hairdresser, two Norfolk
women, a former Maiden bank employee, two chiropractors, two psychologists, an attorney, a
real estate broker, a former stockbroker, an accountant, the estate of a Cambridge woman, and
the estate of a Newton woman. In one incident, the defendant was retained by an elderly Allston
man to prepare a will. The defendant instead stole more than $280,000, $250,000 of which she
was supposed to place in a trust and $30,000 of which she was to invest. The defendant also stole
more than $120,000 from the estate of a Cambridge woman and $320,000 from the estate of a
Newton woman.

The division provided victim advocacy and witness management to the 14 sets of victims. Victim
advocacy included: ongoing notification of the case status; facilitating ongoing contact with the
Clients' Security Board; assistance with state and federal resources to repair credit; guidance with
completing victim impact statements; court accompaniment at the change of plea and sentencing;
and assistance with the certification process to apply for notice of the defendant's release.

• Commonwealth v. Brian Delaney (Economic Crimes Division) The defendant, Brian
Delaney, pleaded guilty on May 6, 2002 before Judge Charles Hely in Middlesex Superior Court
to one count of Larceny Over $250 after scheming his own grandfather into investing $70,000
with him, only to take the money for himself. The defendant deposited his grandfather's funds
into his own accounts and later used the money to buy merchandise, to make cash withdrawals,
and to pay off his credit cards, instead of investing the money as promised. The case was aggravated
by the fact that the defendant gave periodic updates to his grandfather reporting good news about
his investment and creating a fake account and broker, while continuing to ask for and receive

CRIMINAL BUREAU VICTIM/WITNESS ASSISTANCE DIVISION

more money to invest from the elderly victim. Judge Hely accepted the defendant's change of
plea and sentenced him to one year of probation with the condition that $70,000, representing
the restitution owed to the victim, be paid that day

The division provided victim advocacy to the elder victim by coordinating with the victim's
adult son, who served as the elder's liaison at court appearances. In addition, the division informed
the elder victim and his adult son, of the victim's statutory right to complete a victim impact
statement and worked with the Middlesex Superior Court Probation Department to ensure that
the victim was identified for restitution purposes.

• Commonwealth v. Percy Wayne Martin (Public Integrity Division) On May 16, 2002, the
defendant, Percy Wayne Martin, pleaded guilty in Suffolk Superior Court before Judge Patrick
Brady to the following charges: Larceny Over $250 (two counts); Bank Fraud (five counts);
Forgery (seven counts); Uttering (six counts); Larceny under $250 (31 counts); and Identity
Theft (15 counts). The defendant was immediately sentenced to two to three years in State
Prison, one year concurrent in the House of Correction relating to the Larceny under $250
charge, and two years concurrent in the House of Correction relating to the Identity Theft charge.

The investigation revealed that the defendant stole the identities of 15 individuals, 14 of whom
were named Wayne Martin or a variation on that name. Many of the victims lived in Massachusetts,
including Acushnet, Burlington, Dracut, Marshfield, Millbury, New Bedford, Townsend, and
Watertown. Several victims lived out of state. The defendant used the victims' credit to purchase
clothes at Saks Fifth Avenue and Neiman Marcus, to get credit cards and bank loans, and to steal
money. The losses incurred by the victims totaled $75,000.

The Martin case is significant from a victim/witness perspective. Identity Theft is the fastest
growing white-collar crime in the United States. Like cyber crime, identity fraud is a crime
without immediately apparent boundaries. Victims may reside all across the country and are not
always aware of their victimization until contacted by law enforcement.

In the Martin case, the division provided victim advocacy and witness management to the 1 5
victims. The most obvious challenge was to coordinate and communicate effectively with the
victims as 14 of them had the same name as the defendant or a variation of the name. The
division provided ongoing notification of the case status, crisis counseling and referrals to assist
the victims in repairing their credit, assistance with completing victim impact statements, and
notification of disposition and post-conviction follow-up.

CRIMINAL BUREAU VICTIM/WITNESS ASSISTANCE DIVISION

• Commonwealth v. Douglas Chase (High Tech & Computer Crime Division) On August
22, 2001, Massachusetts State Police executed a search warrant and arrested Douglas Chase, a
high school biology teacher, as a result of an investigation relating to instant message conversations
between Douglas Chase and a 1 5-year-old victim. The defendant, Douglas Chase, was arraigned
in New Bedford District Court and charged with the following: (1) Dissemination of Harmful
Material to a Minor (two counts); (2) Attempt to Commit a Crime, Dissemination of Harmful
Material to a Minor (two counts); and (3) Open and Gross Conduct (one count). On June 18,
2002, the defendant pleaded guilty to all charges before Judge Daniel Toomey in Bristol Superior
Court and was sentenced to two and one half years in the House of Correction with 30 days to
serve, the balance suspended for five years.

This case was significant in that it illustrates the dangers faced by children while online. The
division provided victim advocacy to the 1 5 -year-old victim and her mother, who was a witness
to the defendant's online actions. The division kept the victim and her family notified of the case
status and explained the court process throughout the duration of the case. The division assisted
the victim and her mother in completing a Victim Impact Statement which was read at the time
of sentencing.

STATISTICAL SUMMARY

Fiscal Year 2002 ushered in an exceptional year for the Victim/Witness Assistance Division, 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 the victim/witness advocates on 66 cases
across the Commonwealth. The case breakdown is as follows:

REFERRAL SOURCE NUMBER OF CASES

Economic Crimes Division 1 7

Consumer Protection Prosecution Unit 3

High Tech and Computer Crime Division 1 2

Public Integrity Division 7

\)1

CRIMINAL BUREAU VICTIM/WITNESS ASSISTANCE DIVISION

Environmental Crimes Strike Force 7

Special Investigations and Narcotics Division 9

Appeals Division 6

Public Protection Bureau, Civil Rights Division 1

Conflict Cases 4

TOTAL

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

During Fiscal Year 2002, members of the division were involved in significant activities and initiatives
in an effort to respond to issues of critical import. In the wake of September 11, 2001, advocates
responded to family survivors who called for guidance and support. The division coordinated with the
Attorney General's Victim Compensation and Assistance Division, the Massachusetts Office of Victim
Assistance, each of the 1 1 District Attorneys' Offices, and collateral service providers to identify resources
and referrals. The Director of the Division, together with the Director of the Victim Compensation and
Assistance Division, attended a Family Assistance Meeting on October 19, 2001 hosted by Senator Ted
Kennedy to provide information and support to family survivors and loved ones.

In the wake of the clergy abuse scandal, the division also responded to 67 calls from survivors of
clergy abuse. Again, the division coordinated with the Massachusetts Office of Victim Assistance, each
of the 1 1 District Attorneys' Offices, and collateral service providers to identify resources and referrals.
The Director of the Division sat on the Attorney General's Elder Strike Force to respond to elder inquiries
and to create solutions. The division also provided ongoing in-house consultation to prosecutors,
investigators, and state troopers by screening and responding to duty calls and correspondence from the
public when victim/witness issues were identified.

CRIMINAL BUREAU VICTIM/WITNESS ASSISTANCE DIVISION

OUTREACH, EDUCATION, AND TRAINING

During Fiscal Year 2002, the division's advocates maintained numerous outreach efforts in community
activities and both taught and attended training classes inside and outside of the Office of the Attorney
General, including:

• Meeting with the Clients' Security Board of the Supreme Judicial Court to facilitate an educational
consult so that the division could better advise victims of their recourse in cases of fiduciary
embezzlement.

• Attending the New England Conference on Financial Crimes, Providence, Rhode Island, which
was sponsored by the United States Attorneys for the Districts of Rhode Island, Connecticut,
New Hampshire, Massachusetts, Maine, and Vermont.

• Serving as an Elder Advocate on the Attorney General's Elder Strike Force.

• Attending the Annual Massachusetts Councils on Aging Conference, Falmouth, MA.

• Serving as the Attorney General liaison at bimonthly meetings of the Boston Area Sexual Assault
Coalition at Massachusetts General Hospital.

• Serving as the Attorney General liaison on the domestic violence subgroup of the Massachusetts
District Attorneys Association.

• Attending regular meetings for statewide Victim Witness Directors sponsored by the Massachusetts
District Attorneys Association.

• Attending bimonthly meetings of the Victim and Witness Assistance Board chaired by Attorney
General Tom Reilly

• Attending 1 7 educational training seminars across the Commonwealth relating to victim/witness
issues.

• Conducting training related to the implementation of the Victim Rights Law and the role of the
Victim/Witness Assistance Division to the Victim Services Coordinator, Massachusetts Office
for Victim Assistance, and the Criminal Bureau summer interns.

• Volunteering at the Paul McLaughlin Center, reading to youth as part of the Youth Empowerment
Skills Project.

CRIMINAL BUREAU SPECIAL INVESTIGATIONS AND NARCOTICS DIVISION

• Attending the Annual Victim Rights Conference in April 2002 sponsored by the Massachusetts
Office for Victim Assistance, the Victim and Witness Assistance Board, Attorney General Tom
Reilly, and the Massachusetts District Attorneys Association.

• Attending the National Organization for Victim Assistance's 27th Annual Conference, Edmonton,
Alberta, Canada.

SPECIAL INVESTIGATIONS AND NARCOTICS DIVISION

The Special Investigations and Narcotics (SI&N) Division coordinates and prosecutes a variety of
complex, multi-jurisdictional criminal cases. The division also proactively investigates traditional criminal
enterprises — including so-called organized crime families and large-scale drug trafficking organizations
— as well as non-traditional criminal organizations such as street gangs and armed robbery rings. A
priority of the division is to identify and prosecute individuals and groups involved in the illegal sale or
possession of firearms. SI&N prosecutors are also responsible for providing assistance in the drafting of
legislation pertaining to electronic surveillance, racketeering and corruption, narcotics, firearms, and child
protection. Division members are encouraged to participate in the conception and implementation of
community education and outreach programs.

The SI&N 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
as well as gaming violations. Funds recovered by the Unit are disbursed in accordance with the
Commonwealth's forfeiture laws.

Among the general categories of crimes the SI&N Division investigated and/or prosecuted during
Fiscal Year 2002 were the following: armed robbery, narcotics trafficking and related offenses, firearms
trafficking, possession of large-capacity weapons and related firearms offenses, armed career criminal
violations, larceny of motor vehicles, larceny of construction equipment, gaming, extortion and loan-
sharking, habitual criminal offenders, and a variety of conflict cases from District Attorneys' Offices
across the state.

Attorneys, State Police Officers, and investigators assigned to the SI&N Division also continued to
work with and provide technical, legal, and other forms of investigative support and assistance to federal,
state, and local law enforcement agencies. These agencies included the Drug Enforcement Administration;
the Bureau of Alcohol, Tobacco and Firearms; the Federal Bureau of Investigations; the United States
Customs Service; the Governor's Auto Theft Task Force; the Costa Rican Police; the Department of
Corrections; District Attorneys' Offices; and various state and local police departments and task forces

CRIMINAL BUREAU SPECIAL INVESTIGATIONS AND NARCOTICS DIVISION

throughout the Commonwealth and, in some circumstances, across the country. These joint undertakings
included investigations of large-scale drug distribution and money laundering organizations, organized
larceny rings, and armed career criminals.

Members of the division for all or part of Fiscal Year 2002 included William F. Bloomer, Division
Chief; Kelly Burns; Aloke Chakravarty; Carole Conley; Joanna Kennefick; Alexandra Moffatt; Eileen
O'Brien; Peter Paulousky; Mary Phillips; Peter Russell; Matthew Shea (Western Massachusetts Division);
and Karen Wells. Approximately 10 Massachusetts State Troopers are assigned to the SI&N Division
within the Attorney General's Office. During part of Fiscal Year 2002, then-Captain Mark Delaney
oversaw the command of all State Police Detectives assigned to the Attorney General's Office, including
SI&N troopers. After Captain Delaney s promotion to Major, Lieutenant Stephen Matthews assumed
the role of detective supervisor. Lieutenant Francis Matthews, with Lieutenant Thomas Coffey and
Sergeant Richard Prior, formed the central core of the remaining command structure for SI&N troopers.

SIGNIFICANT CASE SUMMARIES

• Commonwealth v. Dennis Garafolo (Springfield Superior Court); Commonwealth v.
Richard Green (Springfield Superior Court); Commonwealth v. Kyle Washing ton (Springfield
Superior Court); Commonwealth v. Aaron Thomas (Springfield Superior Court);
Commonwealth v. Charles Bowes (Springfield District Court) During Fiscal Year 2002, State
Police and prosecutors assigned to the SI&N Division commenced an investigation into the
larceny and resale of heavy construction equipment in the Springfield area. The focus of the
investigation quickly enlarged to include drug dealing and illegal gaming activities by individuals
involved in organized crime. Investigators tapped three cellular telephones and one residential
telephone during the course of the 1 1 -month investigation. In addition, an undercover trooper
infiltrated one segment of this group and purchased a half-dozen stolen construction equipment
pieces, including one Caterpillar Skidsteer (stolen from a Springfield Basketball Hall of Fame
construction site), a John Deere Skidsteer and trailer, a New Holland Skidsteer, a Caterpillar
Backhoe, and a Bobcat Skidsteer. The undercover trooper also purchased over 200 grams of
cocaine from several targets of the investigation, and he participated in illegal poker games played
on video machines in commercial establishments in the Greater Springfield area. In late September,
State Troopers assigned to the Attorney General's Office, in conjunction with State Troopers
assigned to the Special Services Unit and the Hampden County District Attorney's Office, executed
nearly 60 search warrants in and around Springfield and seized over 125 video gaming machines.
Prosecutors from the Attorney General's SI&N Division and the Hampden County District

CRIMINAL BUREAU SPECIAL INVESTIGATIONS AND NARCOTICS DIVISION

Attorney's Office brought gaming, larceny, and drug trafficking charges against a number of
individuals as a result of this coordinated effort.

• Commonwealth v. Philip O'Neil (Middlesex and Suffolk Superior Courts) ; Commonwealth
v. Kevin Q'Neil (Middlesex Superior Court); Commonwealth v. Paul Allen (Middlesex Superior
Court); Commonwealth v. lason Souza (Middlesex Superior Court); Commonwealth v. Jeffrey
Houlihan (Middlesex, Suffolk, and Essex Superior Courts); Commonwealth v. Nelson Baez
(Middlesex Superior Court) ; Commonwealth v. Norberto Delesus (Middlesex Superior Court) ;
Commonwealth v. Larry Mulcahv (Essex Superior Court) ; Commonwealth v. Sean Noonan
(Essex Superior Court); Commonwealth v. lames Garvey (Suffolk Superior Court);
Commonwealth v. Daniel Feeney (Somerville District Court); Commonwealth v. A Juvenile
(Cambridge District Court) In 2001, police and prosecutors were confronted with a rash of
pharmacy robberies targeting the theft of OxyContin pills — a highly addictive, opiate painkiller.
Facing a public safety and public health emergency due to the escalating numbers of pharmacy
robberies, Attorney General Reilly formed the OxyContin Task Force in August 200 1 . The Task
Force consisted of members of the State Police, the Boston Police, local police departments,
federal law enforcement agencies, and prosecutors assigned to the SI&N Division and District
Attorney's Offices throughout Eastern Massachusetts. The initial goal of the Task Force was to
identify and apprehend the most violent repeat offenders who, if not stopped, posed a significant
risk of killing or seriously injuring someone. These perpetrators, after carefully casing targeted
pharmacies, committed the robberies in organized groups armed with guns while disguising their
physical features. The Task Force spent several months actively gathering intelligence through a
variety of means, including electronic and physical surveillance, undercover police work, and
cultivating informants. This process led Task Force members to identify several loosely affiliated
groups who resided in or had ties to Charlestown. By the end of March 2002, Task Force
members had arrested and charged 1 2 individuals in connection with six armed robberies of
pharmacies in Suffolk, Middlesex, and Essex counties. These individuals were charged with
offenses ranging from armed robbery while masked to trafficking in oxycodone to armed career
criminal violations. In addition, Task Force members thwarted pharmacy robberies in Medford
and Arlington by infiltrating the groups with undercover police agents before the robberies could
take place. Firearms, including a Tec 9 large-capacity weapon and handguns with obliterated
serial numbers, knives, a bullet-proof vest, masks, gloves, thousands of dollars, and hundreds of
OxyContin pills and other narcotics were seized by Task Force members. The results of Attorney
General Reilly s task force initiative represented an outstanding coordinated effort between state
and local law enforcement agencies to combat a newly evolving threat to the public.

CRIMINAL BUREAU SPECIAL INVESTIGATIONS AND NARCOTICS DIVISION

• Commonwealth v. Monica Reyes (Suffolk and Middlesex Superior Courts);
Commonwealth v. Mario Reyes, jr. (Suffolk and Worcester Superior Courts); Commonwealth
v. William Torres (Suffolk and Worcester Superior Courts); Commonwealth v. Jose Rivera
(Suffolk Superior Court); Commonwealth v. lames Abreus (Suffolk Superior Court);
Commonwealth v. Estaban Palarios (Suffolk Superior Court); Commonwealth v. Gllberto
Cruz (Middlesex Superior Court) ; Commonwealth v. Faber Aldana (Middlesex Superior Court)
From July through October 2001, Massachusetts State Police and prosecutors assigned to the
Attorney General's Office, in conjunction with the federal Drug Enforcement Administration,
conducted a wiretap investigation into a heroin, cocaine, and MDMA (ecstasy) importation and
distribution organization operating in the Greater Boston area. The reach of the organization
extended from Boston to Costa Rica. During a 45-day period, investigators monitored
conversations over five different telephones associated with this organization pursuant to court
orders. Narcotics were seized from targets by means of controlled and undercover purchases of
heroin and MDMA (ecstasy) , interdiction of narcotics coming from Costa Rica for distribution
in the Boston area, interdiction of narcotics coming from New York City for distribution in the
Boston area, a motor vehicle stop based on information gleaned from the wiretap, and the execution
of nine search warrants. The narcotics seizures in this investigation, dubbed "Operation Colombian
Gold", totaled approximately 20 kilograms of cocaine, four kilograms of heroin, 1,000 MDMA
(ecstasy) pills, firearms and ammunition, and thousands of dollars representing illegal drug proceeds.
The Massachusetts investigation culminated in the execution of search warrants on November 2,
2001, a day after the arrest of two targets as they were bringing approximately 700 grams of
cocaine back to the Boston area from New York City. Eight individuals were arrested in
Massachusetts. Additional arrests were made in New York and Costa Rica, and are being prosecuted
by their respective state agencies. This investigation exemplified the successful cooperative efforts
among separate law enforcement entities working together with the Attorney General's Office to
attain one goal.

• Commonwealth v. Sambo Sok (Middlesex Superior Court); Commonwealth v. Vinchet
Som (Middlesex Superior Court); Commonwealth v. Dorath Dou (Middlesex Superior Court);
Commonwealth v. Joshua Rodriguez (Middlesex Superior Court); Commonwealth v. Two
Juveniles (Lowell District Court) In Fiscal Year 2002, the Governor's Auto Theft Task Force
and the Lowell Police Department enlisted the assistance of prosecutors assigned to the SI&N
Division in undertaking an effort to thwart the escalating problem of car theft in Greater Lowell.
Investigators and prosecutors assigned to "Operation Baywatch" equipped an undercover auto
service garage with audio and visual recording devices after spreading word on the street that it
was a chop shop receptive to purchasing stolen vehicles. Six people were charged in connection

CRIMINAL BUREAU SPECIAL INVESTIGATIONS AND NARCOTICS DIVISION

with a stolen car ring after investigators purchased nearly one dozen stolen vehicles from them.
Seventy-six indictments against these individuals were returned in Fiscal Year 2002 with charges
ranging from being a common and notorious thief to illegal possession of a master key for certain
types of motor vehicles. Two individuals have already pleaded guilty to charges, and two others
were apprehended after fleeing the Commonwealth.

• Commonwealth v. Dolan McNamee (Hampden Superior Court); Commonwealth v.
lames Doyle (Hampden Superior Court); Commonwealth v. Brian Damato (Hampden
Superior Court); Commonwealth v. Michael Shelton (Hampden Superior Court) Beginning
in 1997, a federal and state task force infiltrated two outlaw motorcycle gangs — the Hells
Angels Pittsfield Club and the Longriders of Ludlow — with a cooperating witness and an
undercover state trooper. Over the next few years, the undercover trooper currently assigned to
the Attorney General's Office and the cooperating witness made several purchases of trafficking
quantities of cocaine from members of both motorcycle gangs. In Fiscal Year 2002, four individuals
were indicted in connection with these drug sales. Within several months, prosecutors in the
SI&N Division secured guilty pleas from three defendants in Hampden Superior Court. The
fourth defendant awaits trial.

• Commonwealth v. $35.133.95. One 1999 GMC Denali and One Sea Ray Power Boat

(Middlesex Superior Court) Following a wiretap investigation in 1999 targeting an extensive
OxyContin and ecstasy distribution ring, the Asset Forfeiture Unit initiated several civil forfeiture
actions against personal property and drug profits held by the targets of that investigation. After
extensive pre-trial litigation, the head of that drug distribution organization pleaded guilty to a
mandatory minimum seven years in state prison and agreed to forfeiture of his ill-gotten gains.

• Commonwealth v. Frank Fister (Worcester and Suffolk Superior Courts) ; Commonwealth
v. Ronald Cavaliere (Worcester Superior Court) These cases illustrate the typical work done on
a daily basis by investigators and prosecutors assigned to the SI&N Division. In the spring of
2002, State Troopers assigned to the SI&N Division received information from the New
Hampshire State Police informing them that a large quantity of marijuana would be delivered to
Cavaliere's residence in Milford, Massachusetts. Upon corroborating this information through
surveillance, troopers seized over 350 pounds of marijuana from Fister's vehicle as well as an
additional 110 grams of cocaine and several thousand dollars. During the booking process, Fister
made several statements that alerted investigators to the possible removal of evidence from his
realty business on Beacon Hill in Boston. Follow-up investigation resulted in the seizure of an

CRIMINAL BUREAU SPECIAL INVESTIGATIONS AND NARCOTICS DIVISION

additional five pounds of cocaine and six pounds of marijuana that had been removed from
Fister's office by an accomplice.

• United States v. Carlos Bello (U.S. District Court, Boston, Massachusetts) From September
27, 1999 through January 10, 2000, 40 wiretap warrants were issued by a Massachusetts Superior
Court judge authorizing troopers and prosecutors in the division to secretly intercept and record
certain wire communications occurring over a variety of electronic devices in the Greater Lawrence
area. At the conclusion of the wiretap investigation, a federal grand jury indicted Carlos Bello
and Miraldo Lizardo, an Essex County Deputy Sheriff, for conspiracy to distribute cocaine. In
February 2002, Bello pleaded guilty in federal court to conspiring to distribute 49 kilograms of
cocaine. He was sentenced to 10 years in Federal Prison. His co-defendant, Lizardo, presently is
awaiting trial.

• Commonwealth v. George Lubell (Essex and Suffolk Superior Courts) Following an
extensive wiretap investigation, George Lubell, a former Corrections Officer, pleaded guilty to a
variety of offenses including Illegal Possession of a Firearm and Ammunition and Trafficking in
an Opiate Derivative (OxyContin) . He was sentenced to a mandatory minimum of five to seven
years in State Prison. The case represented excellence in prosecution and police work in light of
the fact that the trafficking charge was entirely based on circumstantial evidence and a trafficking
quantity of OxyContin was not seized from the defendant.

STATISTICAL SUMMARY

CASE ANALYSIS

Felony Arrests 75

Criminal Cases Initiated 8 1

Civil Forfeiture Cases Initiated 24

Criminal Cases Disposed* 75

Civil Forfeiture Cases Disposed* 31
* Some were opened in prior fiscal years.

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CRIMINAL BUREAU SPECIAL INVESTIGATIONS AND NARCOTICS DIVISION

At any given time, the division generally has in excess of 100 cases pending in various courts throughout
the Commonwealth, over 1 5 ongoing investigations, and a handful of post-trial motions that require
written responses and court appearances. During the fiscal year, State Police assigned to the SI&N
Division made approximately 75 felony arrests. Prosecutors in the division in turn successfully disposed
of 75 pending cases in the Massachusetts Superior and District Courts (62 of which were initiated in
prior fiscal years) while initiating approximately 81 new cases in those same courts. Of the number of
drug cases investigated by the division in Fiscal Year 2002, about 15% of these involved two controlled
substances rapidly growing in popularity among young adults: oxycodone, a highly addictive painkiller
(the active ingredient in pharmaceutical OxyContin), and Methylenedioxy-N-Methylamphetamine
(MDMA), otherwise known as the designer drug ecstasy. The remaining percentage of narcotics cases
included the more common street drugs such as heroin, cocaine, and marijuana. The vast majority of
these cases involved trafficking quantities of these drugs.

During this fiscal year, State Police assigned to the SI&N Division seized 10 guns ranging from an
Intratec 9 mm semi-automatic firearm to several handguns with obliterated serial numbers. Based upon
these seizures as well as undercover purchases of weapons, prosecutors in the SI&N Division charged 22
individuals with a variety of firearms offenses including armed career criminal violations, possession of
large-capacity weapons, and receiving firearms with obliterated serial numbers.

In addition to prosecuting pending criminal cases, Assistant Attorneys General in the SI&N Division
responded to six post-trial motions. These motions, filed by convicted felons, sought new trials or
sentence reductions. Of the number of post-trial motions filed, four were denied and two remain
outstanding.

During this fiscal year, the Asset Forfeiture Unit initiated 24 new civil forfeiture actions and concluded
31 actions involving money, cars, motorcycles, and jewelry. By way of example, the Asset Forfeiture
Unit initiated several civil forfeiture actions involving a number of automobiles used to facilitate the
distribution of narcotics including one 2000 Jaguar XJ, one 1998 Chevrolet Tahoe, one 1998 Mitsubishi
Galant, and one 1997 Mazda 626. In addition, the Asset Forfeiture Unit initiated a civil forfeiture action
against one parcel of land and a building in Milford, Massachusetts. This real property was used to store
large quantities of cocaine and marijuana for further distribution in Massachusetts and New Hampshire.

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CRIMINAL BUREAU SPECIAL INVESTIGATIONS AND NARCOTICS DIVISION

WIRETAP ANALYSIS

Wiretap Warrant Applications 1 5

Wiretap Warrants Received 1 5

Devices Tapped 9

One-Party Consent Warrant Applications 60+

One-Party Consent Warrants Received 60+

A significant tool that the division utilized to penetrate and dismantle complex illegal enterprises
during Fiscal Year 2002 was electronic surveillance. Over the past year, troopers assigned to the division
have on numerous occasions equipped themselves with electronic body wires, pursuant to so-called Blood
warrants, to intercept and record criminal conversations with unsuspecting targets. Additionally, from
July 2001 through June 2002, the SI&N Division executed 15 court-authorized wiretap warrants
(excluding one-party consent / Blood warrants). These warrants authorized law enforcement officers to
intercept, monitor, and record criminal communications occurring over several cellular and residential
telephones. These electronic surveillance measures, coupled with traditional investigative techniques,
have proven invaluable in securing the convictions of individuals with ties to a variety of sophisticated
criminal enterprises. Because of their considerable expertise in this area, attorneys in the division are
frequently asked to assist police officers and fellow prosecutors in the law of search and seizure and
electronic surveillance.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

Assistant Attorneys General assigned to the SI&N Division continued to provide service and assistance
both in and out of the office that exceeded the scope of traditional prosecutorial responsibilities. Some
of these extracurricular contributions included service on the Attorney General's Racial Profiling Working
Group; the Attorney General's Children's Protection Project — New Initiatives; and the Attorney General's
Ballot Initiative Certification Group. In addition, members of the division drafted a new wiretap statute
— designed to address developments in technology and the proliferation of a broader base of criminal
offenses — for legislative consideration.

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As noted above, in August 2001 Attorney General Reilly formed the OxyContin Task Force out of
state and local law enforcement agencies in order to combat the escalating number of pharmacy robberies
targeting the drug OxyContin. In addition to investigating and prosecuting these armed robberies, Task
Force prosecutors met with members of the Massachusetts Retailers Association, including representatives
from chain and independent pharmacies, to discuss public safety issues. Task Force prosecutors also met
with representatives from Purdue Pharma, the manufacturer of OxyContin, to discuss public health and
safety concerns. Finally, one Task Force prosecutor became Attorney General Reilly s representative on
the National Association of Attorneys General Prescription Drug Task Force.

During Fiscal Year 2002, attorneys in the SI&N Division were also required to act as point
persons for the office on a variety of topics that require specialized knowledge in certain areas of law. For
instance, prosecutors in the division provided advice and assistance to attorneys and police officers across
the state in rendition matters. In addition, an assistant attorney general screened all public record inquiries
directed to the division. Prosecutors also served as the division's intern coordinators, who in that capacity
supervise and monitor the progress of law student interns assigned to the division.

OUTREACH, EDUCATION, AND TRAINING

Members of the division attended trainings both inside and outside the office during Fiscal Year 2002
in an effort to keep abreast of important current issues and trends in the law. These trainings encompassed
a variety of topics, including ethics, anti-discrimination, and trial advocacy techniques. Some of the
trainings attended by assistant attorneys general in the division included Mile's Trial Advocacy Training;
Daubert/Lanigan Roundtable Discussion; the NAC's Computer Forensics and Cyber Crimes Investigations
Training; the BBA's Cutting Edge Issues in Criminal Law; the Probation Department's Alternative
Sentencing Training; The Organized Crime and Drug Enforcement Task Force Conference in New
Hampshire; and an internal training on Handling High Profile Prosecutions.

Two assistant attorneys general in the division served as faculty for (1) the National Association of
Attorneys General, Trial Practice Academy, and (2) the National Advocacy Center for the National
District Attorneys Association. Attorneys in SI&N also participated in the Citizen Schools Mock Trial
Program, a community outreach program for youths in the inner city, in the fall of 2002.

103

CRIMINAL BUREAU ECONOMIC CRIMES DIVISION

ECONOMIC CRIMES DIVISION

The Economic Crimes Division (ECD) 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 egregious effects of private-sector white-collar offenders within the state through both
pro-active prevention and aggressive prosecution. The cases handled by the division vary in size — from
the $50,000 theft from a single elderly victim to the multi-million-dollar theft from a large corporation
— but all are designed to have a significant impact, whether through deterring future criminal activity or
incapacitating a particularly serious offender. The goal of the division is not only to indict and convict
guilty felons, but also to assist the public and private sectors in creating systemic change in order to
prevent fraud.

The Economic Crimes Division consists of a specialized team of criminal prosecutors and one legal
secretary, all of whom have the collective expertise in the following areas of criminal law: (1) fiduciary
embezzlement, (2) complex financial organizational frauds, (3) securities violations, and (4) tax offenses.
In each of these areas, the prosecutors lead investigative teams made up of civilian investigators from the
Financial Investigations Division of the Criminal Bureau and/or State Police Detectives.

The Economic Crimes Division receives referrals from 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 Client Security Board, the Criminal Investigations Bureau of the Department of Revenue, the Secretary
of the Commonwealth, the United States Attorney's Office, and various District Attorneys' Offices
across the state.

The division underwent significant personnel changes during Fiscal Year 2002, with Assistant Attorney
Generals Lori Balboni, Steven Prunier, and Mary Ruppert leaving the office. The members of the division
during part or all of the fiscal year consisted of Carol Starkey, Division Chief; Lori Balboni; Olivia
Blanchette; Mark Mulligan; Molly Parks; Steven Prunier; and Mary Ruppert.

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CRIMINAL BUREAU ECONOMIC CRIMES DIVISION

SIGNIFICANT CASE SUMMARIES

• The Treasury Cases (Suffolk Superior Court) The Criminal Bureau's investigation of a
series of related larcenies from the Treasurer's Office, which was staffed in large part by ECD
attorneys, wrapped up this year with guilty pleas and jail sentences for six defendants and one
acquittal. As a result of the Treasury investigation, the Attorney General's Office has recovered or
received commitments for the return of more than $8 million stolen from the Treasury.

These cases involved indictments against seven individuals, which alleged that eight different
criminal schemes were committed involving thefts from the Treasurer's Office between May
1992 and February 1998. The total amount of money stolen as a result of these alleged schemes
was approximately $9.4 million. The majority of these schemes involved thefts from the Treasury's
Unpaid Check Fund (the UPCF), through a combination of the filing of phony heirfinder
claims and kickback arrangements involving inside employees to the Treasurer's Office and outside
individuals operating as heirfinders. 2 Finally, there were further indictments that alleged that
money was stolen from the Teller's Cage or vault area of the Treasurer's Office located at One
Ashburton Place.

The following three defendants pleaded guilty and were sentenced in the past year:

Martin Robbins admitted that he and co-defendant John Trischitta, the former supervisor of
the UPCF, engaged in a scheme whereby Trischitta would provide Robbins with inside
information and preferential treatment that would assist Robbins in making claims to the
UPCF. In exchange, Robbins paid Trischitta one-third of all of the profits from the claims
he submitted to the UPCF. The two men submitted in excess of 150 claims in a little over
half of a year, highlighted by a false claim Robbins submitted in November 1 998 to Trischitta
for over $6.5 million in unclaimed funds. Robbins pleaded guilty to forgery, uttering, bribery,
and conspiracy to commit larceny and bribery. He was sentenced to two years in the House
of Correction followed by a second sentence of two years in the House of Correction and
was ordered to pay restitution of $ 170,000.

Ronald Borino admitted that he worked with former Deputy Treasurer Robert Foley, Attorney
Richard C. Arrighi, and Trischitta to steal $1.6 million from the UPCF. He pleaded guilty
to Conspiracy to Conceal Stolen Property, to Concealing Stolen Property, and to Making a

2 Heirfinders are people in the business of locating payees of unpaid checks in the UPCF and facilitating the payment to them of
the money they are owed from these unpaid checks.

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False Entry as a Bank Trustee or Agent. He was sentenced to two and one half years in the
House of Correction and ordered to pay restitution of $418,981.87.

Richard Arrighi pleaded guilty to Conspiracy to Aid in the Concealment of Stolen Property,
to Aiding the Concealment of Stolen Property, to Failure to File Fiduciary Tax Returns, and
to Filing False Tax Returns. He was sentenced to three years in the House of Correction and
five years of probation and ordered to pay $540,000 in restitution to the Commonwealth.

The following three defendants pleaded guilty last year 3 and agreed to suspend their sentencing
until providing testimony in the above prosecutions:

Thomas Ciliberto admitted that, after being approached by then-Deputy Treasurer Robert
Foley, he started an heirfinder business and then submitted over 160 claims to the UPCF and
shared the proceeds with Foley and Trischitta, in return for the two Treasury employees
providing Ciliberto with inside information about large unpaid checks in the UPCF and
helping Ciliberto prepare, submit, and process claims. Ciliberto pleaded guilty to Larceny
Over $250, two counts of Bribery, and Conspiracy to Commit Larceny and Bribery and was
sentenced to two and one half years in the House of Correction, with six months to serve and
the balance suspended for two years with, from, and after probation for three years. He was
also ordered to pay $ 100,000 in restitution in addition to the $306,000 he had already paid.

Robert Foley, the former Deputy Treasurer, pleaded guilty to two counts of Embezzlement
by aTreasury Employee, Bribery, Conflict of Interest, Concealing Stolen Property, Receiving
Stolen Property, and Conspiracy to Commit Larceny from the Treasury, Conceal Stolen
Property and Commit Bribery. He was sentenced to five years to five years and one day in
State Prison, with three years of probation from and after the completion of the prison
sentence, and was ordered to pay $909,033.37 in restitution.

John Trischitta, the former supervisor of the Unpaid Check Fund, pleaded guilty to
Embezzlement by a Treasury Employee, Bribery, Conflict of Interest, and Conspiracy to
Commit Larceny from the Treasury and Bribery. He was sentenced to two consecutive two-
year sentences in the House of Correction.

• Commonwealth v. Shirley Hoak (Middlesex Superior Court) The defendant, a disbarred
attorney, pleaded guilty to stealing over $1.6 million of her clients' money. Among her victims
was an elderly man who hired her to prepare a will leaving the bulk of his estate — some $250,000

3 A seventh defendant was found not guilty after a jury trial.
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CRIMINAL BUREAU ECONOMIC CRIMES DIVISION

— to two former neighbors. Hoak instead persuaded her client, who lived in a single room in an
assisted-living facility, to put all of his money in a trust to benefit those neighbors and then stole
the money from the trust to benefit herself. Hoak pleaded guilty to three counts of Larceny
Over $250, and two counts of Larceny Over $250 From a Person over 60, was adjudicated a
common and notorious thief, and was sentenced to serve two and one half years in the House of
Correction followed by 10 years of probation, during which time she is to pay restitution.

• Commonwealth v. Ziad Shahin (Essex Superior Court) The defendant was convicted after
a jury trial on charges of Larceny Over $250 in relation to his diversion of tens of thousands of
dollars entrusted to him to invest by the elderly retired victim. He was sentenced to two years in
the House of Correction with six months to be served on weekends and the balance suspended
for three years, during which time he is to pay restitution.

• Commonwealth v. Leo Burns and Thomas Ribag a (Barnstable Superior Court) The
defendants — financial advisors — perpetrated a string of larcenies and securities fraud in multiple
counties. They both pleaded guilty in the middle of a bench trial that involved removing the
Court to a nursing home to take the testimony of an 83-year-old victim. Burns pleaded guilty to
nine counts of Larceny Over $250 and four counts of Unlawful Sale of a Security and was
sentenced to two years in the House of Correction, with a year to serve and the balance suspended
for nine years. He was also ordered to pay restitution of $ 1 44,838.62. Ribaga pleaded guilty to
1 counts of Larceny Over $250 and four counts of Unlawful Sale of a Security and was sentenced
to 10 years of probation. He was also ordered to pay restitution of $312,838.62.

• Commonwealth v. lohn I. Wilbur (Suffolk Superior Court) Wilbur allegedly submitted
30 separate income tax returns to the Commonwealth over a number of years in various names,
garnering some $40,000 in tax refunds to which he was not entitled. He has been indicted on 30
counts of Filing a False Claim Against the Commonwealth and two counts of Identity Fraud.

• Commonwealth v. Sean Murphy (Suffolk Superior Court) This defendant attempted to
take advantage of the sex-abuse allegations surrounding the Catholic Church by falsely claiming
that when he was a young boy, a priest sexually assaulted him. He supported this claim with
documents that he manufactured, and then demanded a cash settlement from the Church. He
also asked four other individuals to make similar claims. The defendant pleade guilty to two
counts of Attempted Larceny, and Conspiracy to Commit Larceny and four counts of Solicitation
to Commit Larceny and was sentenced to 23 months in the House of Correction and three years
of probation.

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CRIMINAL BUREAU

ECONOMIC CRIMES DIVISION

In addition, an ECD attorney was the lead prosecutor in the prosecution of MRP Site Development
for various environmental crimes. The defendant ultimately pleaded guilty in Middlesex Superior
Court to 40 counts of failure to notify of releases of hazardous materials, was placed on probation
for four years, and was ordered to pay a $lmillon fine and $419,802.50 in restitution.

STATISTICAL SUMMARY 4

ECD focuses on preventing, investigating, and prosecuting fraud in five areas: fraud within organizations
— be it the government, a business, a charity, or a union; embezzlement by attorneys and other fiduciaries;
securities and investment fraud (including embezzlement by financial advisers); tax fraud; and attempts
to con consumers and businesses (including identity fraud) . The following chart summarizes the case
referrals that ECD screened for possible investigation and prosecution during Fiscal Year 2002, the number
of cases of individuals indicted, and the number of individuals who were convicted in each of those five
prosecution categories.

CASE TYPE

NUMBER OF NUMBER OF NUMBER OF
CASES INDIVIDUALS INDIVIDUALS

SCREENED CHARGED CONVICTED

Fraud Within an Organization 22

Embezzlement by Attorneys

and Other Fiduciaries 2 1

Securities and Investment Fraud 5 8

Tax Fraud 10

Attempts to Con Consumers

and Businesses 23

TOTAL

4 Some of the cases charged this year remain pending, just as some of the cases resolved this year were charged previously,
including embezzlement by financial advisers.

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CRIMINAL BUREAU ENVIRONMENTAL CRIMES STRIKE FORCE

ECD prosecutors also devoted substantial time to assisting two large and ongoing bureauwide Grand
Jury investigations.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

ECD attorneys have worked closely with staff from the Executive Bureau to draft new legislation in
many areas, including changes to the identity fraud statute and the creation of a money laundering
statute. In other areas, such as with the Electronic Signature Bill, ECD attorneys have been asked to
provide comments based on their unique expertise.

OUTREACH, EDUCATION, AND TRAINING

Throughout the year, ECD attorneys regularly shared their expertise in the investigation and prosecution
of financial crimes by offering training sessions within the Office of the Attorney General, by serving as
panelists and speakers for a number of programs organized by outside entities, and by participation in the
management of the Boston and Massachusetts Bar Associations' Criminal Law Sections. Highlights
included: presenting a lecture to the Boston Bar Association Criminal Law Section on Diminished Capacity
in White Collar Cases, planning and presenting internal trainings on handwriting analysis and the use of
business records, serving as a critiquer for the National Institute for Trial Advocacy, and speaking at a
conference of the Ages Elder Strike Force. ECD attorneys also continued to develop their expertise and
educate others to the special mission of the division by attending trainings devoted to their professional
development, including the New England Conference on Financial Crimes, the Massachusetts Continuing
Legal Education trial advocacy program for prosecutors, and various internal trainings.

ENVIRONMENTAL CRIMES STRIKE FORCE

The Massachusetts Environmental Crimes Strike Force (ECSF) is a unique inter-agency enforcement
tool used in the investigation and prosecution of the Commonwealth's environmental enforcement efforts.
Through the cooperation of the Attorney General, the Secretary of Environmental Affairs, the Department
of Environmental Protection (DEP), and the Department of Fisheries, Wildlife and Environmental Law
Enforcement, the ECSF brings prosecutorial, technical, and police resources under a single umbrella.
The ECSF thus provides the legal, scientific, and investigative expertise necessary to identify environmental
violations, evaluate their impact on public safety and the environment, and develop the evidence necessary

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CRIMINAL BUREAU ENVIRONMENTAL CRIMES STRIKE FORCE

to prosecute environmental crimes. The types of cases prosecuted by the ECSF include illegal treatment
and disposal of hazardous waste; water pollution; failure to notify of hazardous material releases; air
pollution cases resulting from burning of wastes and illegal removal of asbestos; and illegal dumping of,
among other things, abandoned drums and tire piles.

In Fiscal Year 2002, the ECSF Division staff included Paul Molloy, Division Chief; Officer Patrick
Haley; Nicholas Kosiavelon; Lieutenant Gail Larson; Officer Michael Moore; Jenny Prokopovich; and
Sergeant Michael Sweeney

SIGNIFICANT CASE SUMMARIES

Highlights of cases handled by the Environmental Crimes Strike Force in Fiscal Year 2002 included:

• Commonwealth v. MRP Site Development. Inc. (Middlesex Superior Court) MRP pleaded
guilty to 40 counts of failure to notify of releases of hazardous material. MRP received four years
probation, was fined Si million, and paid $419,802.50 in restitution to DEP and Massachusetts
Highway Department. MRP was ordered to clean up three additional sites with an estimated
clean-up cost of $500,000. As a result of our prosecution, MRP has already incurred an additional
$ 1 million in clean-up costs.

• Commonwealth v. Piconics. Inc. (Lowell District Court) Piconics, Inc. pleaded guilty in
January 2002 to three counts of violating the Clean Water Act by discharging pollutants to the
groundwater. Piconics was sentenced to two years probation and ordered to pay a $75,000 fine.

• Commonwealth v. Andrew Krook (Leominster District Court) Krook pleaded guilty in
December 2001 to illegally discharging gasoline into storm drain. He was sentenced to one year
probation, with the condition of probation that he pay $34,650.09 in restitution to DEP and
$6,477.36 in restitution to the Town of Leominster at the time of the plea, to cover the clean-up
costs incurred.

• Commonwealth v. Edward Defeudis (Worcester Superior Court) An investigation arose
from allegations that Defeudis demolished a building without notifying the DEP or removing
asbestos materials prior to demolition. Defeudis pleaded guilty to one count of Clean Air Act
violations and was fined $25,000.

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CRIMINAL BUREAU ENVIRONMENTAL CRIMES STRIKE FORCE

• Commonwealth v. L. Sanders Corbit (Middlesex Superior Court) Corbit was accused of
fraudulent site assessments submitted to banks in connection with real estate transactions. The
defendant pleade guilty, during trial, and was sentenced to two years in the House of Correction
suspended, two years probation, and ordered to pay $20,000 restitution and not to work in the
environmental consulting industry.

• Commonwealth v. James Keeley (Norfolk Superior Court) Keeley, a licensed contractor,
was accused of improper asbestos abatement. Dry asbestos removals were performed on at least
two occasions. Keeley was charged with Clean Air Act violations and sentenced to two years
probation and $20,000 restitution after pleading guilty.

• Commonwealth v. Efrain Ayala (Middlesex and Essex Superior Courts) An investigation
was initiated premised upon allegations that asbestos was illegally removed from the Masonic
Temple in Lowell dumped in a vacant lot in Andover. Ayala pleaded guilty in October 2001 and
received two years in the House of Correction suspended, two years probation, and $6,800
restitution to be paid within one year. A condition of his probation is that he cannot work in the
asbestos abatement industry during probationary period.

• Commonwealth v. William Spear (Newburyport District Court) An investigation was
initiated premised upon allegations of two abandoned tractor trailer trucks loaded with drums
containing hazardous waste at a farm in Salisbury. The defendant pleaded guilty to one count of
violating the Hazardous Waste Management Act in December 2001. He was sentenced to a
suspended six-month jail term, with probation for two years. Defendant was also ordered to pay
a $5,000 fine and to perform 200 hours of community service.

• Commonwealth v. Kevin Holland (Worcester Superior Court) Holland pleaded guilty in
July 2001 to illegal removal and disposal of asbestos, and was sentenced to a one-year suspended
sentence, two years probation, and $20,000 restitution and was made to comply with all asbestos
regulations.

• Commonwealth v. Andrew Jones (Franklin Superior Court) Jones pleaded guilty to
improper asbestos removal. Jones was sentenced to one year in the House of Correction suspended,
two years probation, and a $7,500 fine to Clean Air Act compliance fund.

Ill

CRIMINAL BUREAU ENVIRONMENTAL CRIMES STRIKE FORCE

STATISTICAL SUMMARY

Opened Investigations 32

Charged in District Court 2

Indicted in Superior Court 4

Disposed in District Court* 3

Disposed in Superior Court* 9

Closed Cases* 35

Pending Cases 1 5

Restitutions and Fines $ 1 ,640,229

* Some were opened in prior fiscal years.

During Fiscal Year 2002, the Environmental Crimes Strike Force opened 32 investigations and closed
35. There were one corporation and two individuals charged in District Court, and one corporation and
three individuals indicted in Superior Court. Twelve cases resulted in guilty pleas. Of the 1 2 pleas, nine
were handled in Superior Courts and three in District Courts. In addition, the Environmental Police
executed two search warrants.

During Fiscal Year 2002, dispositions of cases prosecuted by the Environmental Crimes Strike Force
resulted in fines amounting to $1,1 12,500 and restitution in excess of $527,729.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

During Fiscal Year 2002, the Environmental Crimes Strike Force took a lead role in a cross-bureau,
inter-agency Asbestos Initiative with the DEP, the Environmental Protection Division, and the Division
of Occupational Safety to stem the tide of illegal removal and disposal of asbestos. The initiative resulted
in convictions under the Clean Air Act in six counties for the illegal removal and/or disposal of asbestos.

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CRIMINAL BUREAU FINANCIAL INVESTIGATION DIVISION

OUTREACH, EDUCATION, AND TRAINING

During Fiscal Year 2002, members of the ECSF were involved in community activities and both
attended and taught training classes inside and outside the Office of the Attorney General, including:

• Conducted environmental crime trainings for the Criminal Justice Training Council and a number
of municipal police training academies;

• Coordinated a cross-bureau, inter-agency Asbestos Initiative with the Environmental Protection
Division, the Department of Environmental Protection, and the Division of Occupational Safety
to stem the tide of illegal removal and disposal of asbestos-containing waste;

• Attended monthly meetings of the Central Artery/Tunnel Environmental Oversight Committee,
which oversees environmental compliance of the CA/T project, as the Attorney General's
representative;

• Attended monthly meetings of the Multi-Agency Task Force on Schools;

• Formulated the Healthy Schools Council, in conjunction with the Executive Office of
Environmental Affairs, the Division of Occupational Safety, and the Department of Environmental
Protection;

• Served as the Office of Attorney General's representative at a number of conferences and trainings
sponsored by the Northeast Environmental Enforcement Project;

• Presented in-house trainings in the use of handwriting experts at trial and closing arguments;

• Served as a faculty member of NAAG Intensive White Collar Prosecutor Training; and

• Served as a faculty member of the Northeast Environmental Enforcement Project's Advanced
Environmental Crimes Training Course in New Jersey

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, tax
fraud, and all other white-collar frauds which are referred to the division. The investigators bring to the
division many years of experience from investigating cases in local, state, and federal government as well
as private-sector venues.

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CRIMINAL BUREAU FINANCIAL INVESTIGATION DIVISION

Investigators assigned to the Financial Investigation Division work as part of the bureau's team approach
to criminal investigative work. Division members become involved in matters at the start of investigation
and work closely throughout with Criminal Bureau prosecutors and also Massachusetts State Police
assigned to the bureau's Criminal Investigation Division.

Investigators may also be asked 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 Office
of the State Auditor (OSA).

As part of the investigation and prosecution team, division investigators assist in the design and
implementation of an investigative plan for each investigation. The planning requires that each member
of the division understand the nature of the allegation, elements of the crime, and evidence required to
prove the matter at trial.

Criminal Bureau investigations involve prolific documentary evidence and require division investigators
to perform extensive examination and analysis of business, personal, and financial records to document
the illegal activities of the white-collar criminal. Additionally, division investigators conduct interviews
of victims, witnesses, and targets, and provide summary witness testimony before special grand juries and
in trial settings. Further, utilizing modern computerized technology, investigators are able to scan a wide
array of informational databases as well as the Internet to track and profile potential subjects of criminal
investigations.

The majority of the division's investigative assignments come from the bureau's Economic Crimes
Division. The division works closely with the Economic Crimes Division Chief during the screening
process and then with the assigned assistant attorney general when a matter has been accepted for formal
investigation.

Other sources of investigative assignments for the division come from the High Tech and Computer
Crimes Division and the Public Integrity Division.

During Fiscal Year 2002, the division also committed investigative resources to the Special Investigations
& Narcotics Division, the Consumer Protection Unit investigating consumer crimes, and the bureau's
investigative efforts of the Central Artery /Third Harbor Tunnel Project. With respect to the former, the
division provided individual and corporate financial profile information for the State Police in one of
their undercover operations. Division members assisted the Consumer Protection Unit's investigator
with numerous witness interviews and provided analytical and organizational skills to the Bureau's Central

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CRIMINAL BUREAU FINANCIAL INVESTIGATION DIVISION

Artery /Third Harbor Tunnel Project investigation. Since the division's formation in 1995, it has also
performed investigative assignments for the Bureau's Environmental Crimes Strike Force and the Appellate
Division.

This fiscal year, division personnel included three Certified Fraud Examiners and five investigators
with backgrounds from the banking industry, insurance industry, a private investigative firm, and the
Middlesex County District Attorney's Office. Members of the division for all or part of the year were:
Paul Stewart, Division Director, Certified Fraud Examiner (CFE); David Baker; Bill Frugoli, CFE; Jen
Hollingsworth; Brendan Kelleher; Jim McFadden, CFE; Jon Murphy; and Sallyann Nelligan.

SIGNIFICANT CASE SUMMARIES

Division members served as Commonwealth summary witnesses for two trials during Fiscal Year
2002. Additionally, division members were scheduled as trial summary witnesses for six of the seven
Treasury cases which pleaded out in advance of trial. Financial Investigation Division members provided
summary witness testimony in the Commonwealth v. Ziad Shahin case. This was an Economic Crimes
Division case in which the defendant was found guilty by a jury trial. The Division also prepared the
summary presentation for another Economic Crimes Division case, Commonwealth v. Leo Burns &
Thomas Ribaga . The defendants pleaded guilty during the trial immediately preceding the summary
presentation.

• Commonwealth v. Arrlghi, et al. (Economic Crimes Division) During this fiscal year,
significant amounts of the division's investigative resources were devoted to preparing for trial in
these matters, which involved investigating the theft of approximately $9.5 million from the
Treasury of the Commonwealth.

This matter was scheduled for trial in the first quarter of Fiscal Year 2002. Given the complex
nature of the case, there were numerous post-indictment and trial preparation interviews. Treasury
trial preparation also involved the preparation of charts summarizing the financial analysis based
in part on the financial transaction database created by the division. Six of the seven defendants
pleaded guilty to their involvement in this theft during Fiscal Year 2002.

Following is a list of some of the other matters investigated by division members during the fiscal
year which resulted in indictments. As with the previously referenced matter, the division requesting
Financial Investigation Division involvement is listed parenthetically and more specific information

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CRIMINAL BUREAU FINANCIAL INVESTIGATION DIVISION

about each of these matters can be found by referring to that division's section in the bureau's
report.

• Commonwealth v. Shirley Hoak (Economic Crimes Division)

• Commonwealth v. leanna Monterio (Public Integrity Division)

• Commonwealth v. Brian Delaney (Economic Crimes Division)

• Commonwealth v. Zachary Hildreth (Economic Crimes Division)

• Commonwealth v. lohn Wilbur (Economic Crimes Division)

• Commonwealth v. Michael Rooney (Public Integrity Division)

STATISTICAL SUMMARY

REFERRING SOURCE NUMBER OF CASES

Economic Crimes Division 4 1

Public Integrity Division 10

High Tech and Computer Crimes Division 5

Special Investigations and Narcotics Division 2

Consumer Protection Prosecution Unit 4

Criminal Bureau Chief 1

Public Protection Bureau, Investigation Division 1

Central Artery / Third Harbor Tunnel Project 1

TOTAL 65

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CRIMINAL BUREAU FINANCIAL INVESTIGATION DIVISION

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

The division performs many administrative duties for the Criminal Bureau with respect to cars,
seized evidence and the spending of forfeited funds. The division is responsible for all bureau cars — the
assignment, reporting, and maintenance. The division maintains a log of all money seized by the State
Police in association with any arrest. The seized money is kept in safety deposit boxes and the contents
are inventoried on a quarterly basis by division staff. Additionally, the division prepares an accounting
record of all forfeited funds of the Special Investigations and Narcotics Division that is disbursed in
accordance with the Commonwealths forfeiture laws. The accounting system is designed as a management
tool for the bureau, not only to retrospectively track spending but also to project future needs.

The division also works with State Police command to assist with background and warrant checks
and NCIC inquiries. Division members also take part in the rotation as duty officers. The duty officers
deal with all citizen inquiries for that particular day.

OUTREACH, EDUCATION, AND TRAINING

The staff is also an integral part of the bureau's outreach to referral agencies. We maintain contact
with the Chief Investigator at CIB, the BBO's Senior Financial Investigator, and the Executive Director
of the Client Security Board to update them monthly on the status of all referrals from their respective
agencies to the Bureau. CIB and BBO cases are referred through the Economic Crimes Division. Our
outreach efforts are designed to complement those of the Chief of the Economic Crimes Division.

Staff also maintain memberships and take an active role in many external and internal organizations,
including the International Association of Certified Fraud Examiners, High Tech Crime Investigators
Association, International Association of Financial Crimes Investigators, Boston Clearinghouse Check
Fraud Association, National White Collar Crime Commission, and National Association of Securities
Dealers. We also serve as members of the Attorney General's Organized Theft Task Force, Office- Wide
Health Care Committee, and Elder Task Force, and on a committee recommending criminal legislative
changes to the Criminal Bureau Chief.

As part of the Attorney General Institute, division members have prepared and taught training sessions
for their colleagues, as well as personnel from outside referral agencies and groups such as the Arson
Investigators Association, the Massachusetts Society of Certified Public Accountants, the Southeastern
Massachusetts Fraud Investigators Association, Suffolk University, the Boston Clearinghouse Check Fraud

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CRIMINAL BUREAU CONSUMER PROTECTION PROSECUTION UNIT |

Association, and the Boston Chapter of the International Association of Certified Fraud Examiners and
numerous local school districts.

Presentations included:

• How to Perform Title Searches of Registered and Recorded Land, and Review Probate Court
Records',

• Interview and Report Writing Techniques;

• Financial Investigative Techniques; and

• Investigative Resources for the Financial Investigator

The division's intern program seeks to provide a valuable one-semester training experience for interested
students who have a background in accounting, finance, business law, or criminal justice. Through the
efforts of our intern coordinator, the division has been provided with a steady stream of talented interns
from Boston area schools.

CONSUMER PROTECTION PROSECUTION UNIT

In September 2001 , the Criminal Bureau and Public Protection Bureau announced the establishment
of a Consumer Protection Prosecution Unit (CPPU) to be housed within the Criminal Bureau. The
CPPU was formed to address the burgeoning amount of fraud targeted at consumers. These crimes
typically involve multiple victims who live and work in many jurisdictions, and as a result, fly under the
radar screen of individual police departments, local prosecutors, and District Court judges, as they each
have only a small part of the overall scheme in front of them. What is more, the seriousness of these cases
cannot be judged by economic loss alone, as the psychological impact on the victims — who are often
from among our most vulnerable populations, whether the elderly or immigrants — that comes from
being conned by someone they trusted is often devastating and may have an economic ripple effect as the
victim withdraws from participation in other legitimate transactions as the result of his or her loss of
trust.

CPPU is staffed by David Cosgrove, a senior prosecutor, who reports directly to the Deputy Chief of
the Criminal Bureau, and Jay Sufferdini, an experienced fraud investigator. While part of the Criminal
Bureau, they coordinate their efforts with the Consumer Protection Division of the Public Protection
Bureau and draw on the resources of the investigators assigned to that division as well as the other
prosecutors and financial investigators and State Police assigned to the Criminal Bureau.

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CRIMINAL BUREAU CONSUMER PROTECTION PROSECUTION UNIT

SIGNIFICANT CASE SUMMARIES

• Commonwealth v. Gaetano Scarpaci (Plymouth and Lowell District Courts) Customers
of Scarpaci's home improvement business complained that he had taken money for work that he
did not perform. Understanding the difficulty in proving that Scarpaci never intended to do the
work — which would need to be shown to establish a violation of the larceny statute — the
CPPU charged Scarpaci with multiple violations of the specialized home improvement fraud
statutes designed to address this specific type of criminal conduct. Those statutes mandate criminal
penalties if a home improvement contractor operates without a license, takes more than a 33%
deposit or does not place estimated start and end dates in the contract with the homeowner.
Scarpaci pleade guilty and was sentenced to three years of probation, ordered to pay a fine and
perform community service, and prohibited from working in the home improvement business.

• Commonwealth v. Todd Pouliot (Plymouth District Court) and Commonwealth v. lames
Palone (Middlesex Superior Court) As with Commonwealth v. Gaetano Scarpaci (described
above), these cases involved allegations that represent examples of the most serious abuses of
home improvement contract businesses to commit fraud. Accordingly, the CPPU charged Pouliot
and Palone with multiple violations of the specialized home improvement fraud statutes designed
to address this specific type of criminal conduct. The cases remain open at fiscal year-end.

• Commonwealth v. Gaspard Francois (Suffolk Superior Court) Francois allegedly preyed
on the immigrant community by approaching immigrants in various locations, including
immediately outside the office of the Immigration and Naturalization Service, representing himself
as a person with specialized training and skills who could help them with the INS, and then
taking their money without providing any service in return. He did, however, allegedly provide
his victims with INS documents that he had manufactured in order to give them the illusion of
progress. Francois faces five felony counts of Larceny by False Pretenses and multiple counts of
Forgery and Uttering. This case remains open at fiscal year-end.

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CONSUMER PROTECTION PROSECUTION UNIT

STATISTICAL SUMMARY

The following chart summarizes the case referrals that the CPPU screened for possible investigation
and prosecution during Fiscal Year 2002.

CASE DESCRIPTION

NUMBER OF REFERRALS

Home Improvement Contractor Fraud 1 7

Unlicensed Practice of Law, Medicine, or Accounting 1 3

Consumer Cons: Pyramid Schemes, etc. 1 1

Impersonation of Charities 3

Retail Operation Committing Fraud 1 1

Other 9

TOTAL

During Fiscal Year 2002, the CPPU charged four individuals (one in two separate courts). Three of
these defendants allegedly engaged in egregious examples of home improvement contractor fraud and
were charged under the specialized statutes designed to deal with that problem, and the fourth defendant
faces charges of larceny and forgery. One person pleaded guilty, and the other three cases remain open at
fiscal year-end. The CPPU prosecutor also assisted with the trial of a securities fraud and larceny case
with an Assistant Attorney General from the Economic Crimes Division and completed the prosecution
of a corrupt Boston Police Officer as a Special Assistant District Attorney for Suffolk County.

CRIMINAL BUREAU CENTRAL ARTERY/TUNNEL PROJECT

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

The CPPU devoted substantial energy during this fiscal year to publicizing its existence with outreach
to local police departments and district attorneys offices. Additionally, as part of the same effort, the
CPPU prosecutor served on the Attorney General's Elder Fraud Strike Force. Finally, the CPPU prosecutor
regularly convened the Consumer Protection Case Screening Committee, a cross-bureau endeavor that
brings together prosecutors and investigators from the Criminal Bureau and Public Protection Bureau to
identify trends, allocate investigative resources, and determine which process — civil or criminal — is
best able to handle a given matter effectively and efficiently.

OUTREACH, EDUCATION, AND TRAINING

The CPPU prosecutor's substantial trial and investigative experience placed him in constant demand
as a trainer, and during the year he was called on to teach at a number of internal education events.
Among the highlights in this area were a daylong investigative skills seminar coordinated by the CPPU
and trial advocacy and deposition skills classes presented by the Attorney General's Institute. CPPU staff
also attended the New England Economic Crimes Summit and the weeklong Trial Advocacy III class at
the National Advocacy Center.

CENTRAL ARTERY / TUNNEL PROJECT

The Central Artery/Tunnel Project (CA/T Project) is the largest, most complex, and most
technologically advanced highway construction project in United States history. The CA/T Project is
building or rebuilding approximately 161 lane miles of urban highway, with about half in tunnels, in a
7.5-mile span through the heart of downtown Boston. With an estimated completion date in the spring
of 2005, the CA/T Project will have taken over 14 years and cost approximately $14.6 billion.

The Office of the Attorney General has many legal responsibilities relating to the CA/T Project.
Among them, the Criminal Bureau investigates and prosecutes individuals, contractors, and corporations
for criminal law violations on the CA/T Project. The Criminal Bureau receives referrals and allegations
from diverse sources and investigates these matters with the assistance of internal investigators, Massachusetts
State Police, and, in certain circumstances, other state and law enforcement agencies. Allegations typically
concern procurement fraud, larceny, false claims, criminal environmental violations, and tax evasion.
The Criminal Bureau also monitors a Big Dig Fraud Hotline which receives calls regarding potential
fraud, waste, and abuse on the CA/T Project.

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CRIMINAL BUREAU CENTRAL ARTERY/TUNNEL PROJECT

Because of the increasing volume and complexity of the Attorney General's responsibilities concerning
the CA/T Project, and the need for centralized control and organization of these responsibilities, in
January 2001 the Attorney General created the position of Director of the CA/T Project. Since many
CA/T Project referrals originate as criminal matters, the Director of the CA/T Project was placed in the
Criminal Bureau. The Director's duties and responsibilities include supervising and conducting criminal
and affirmative civil investigations and litigation pertaining to the CA/T Project, coordinating CA/T
Project investigations and litigations across the various bureaus and divisions of the Office, and serving as
the liaison between the Criminal Bureau and other state and federal law enforcement agencies with
oversight responsibilities for the CA/T Project.

Specific cases involving allegations of criminal activity concerning the CA/T Project are referred to a
Criminal Bureau division based on the subject matter of the case. For example, the Economic Crimes
Division handled cases involving allegations of economic crimes concerning the CA/T Project in Fiscal
Year 2002. Likewise, the Environmental Crimes Strike Force handled cases involving allegations of
environmental crimes relating to the CA/T Project.

In addition to the CA/T Project Director, Nancy Bloomberg, the following individuals worked on
Criminal Bureau cases relating to the CA/T Project in Fiscal Year 2002: Eugenia Carris; Brendan Kelleher;
Paul J. Molloy; Jenny Prokopovich; Stephen Prunier; Mary Ruppert; and Frank Russo.

SIGNIFICANT CASE SUMMARIES

The following cases involve allegations of criminal conduct concerning the CA/T Project but were
handled by other divisions in the Criminal Bureau and are therefore discussed elsewhere in this report:

• Commonwealth v. MRP Site Development. Inc. (Environmental Crimes Strike Force)

• Commonwealth v. Lawrence Shetler (Public Integrity Division)

• Commonwealth v. Yovette Mumford (Public Integrity Division) In addition to the foregoing,
in April 2001 the Criminal Bureau commenced an investigation relating to the CA/T Project's
finances, stemming from a report issued by the Massachusetts Office of the Inspector General on
March 20, 2001 . This investigation remained open at the close of the fiscal year.

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SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

In addition to CA/T Project cases investigated and prosecuted by the Criminal Bureau, the Business
and Labor Protection Bureau (BLPB) and the Government Bureau also handle important legal matters
concerning the CA/T Project. For instance, the BLPB enforces laws relating to wage and overtime
violations and investigates and prosecutes cases of workers' compensation and insurance fraud. The
Government Bureau investigates and conducts affirmative civil litigation relating to false claims on the
Central Artery/Tunnel Project and defends the Commonwealth of Massachusetts in actions brought by
third parties regarding the CA/T Project.

One of the most important functions of the CA/T Project Director is to coordinate and consolidate
CA/T Project activities and litigations across the various bureaus of the Attorney General's Office. This
includes facilitating the flow of information across bureau lines and acting as an information hub on
CA/T Project matters. To accomplish this goal, the CA/T Project Director created an internal task force
group, made up of attorneys, investigators, and state troopers from each of the bureaus that handle
CA/T Project matters, that meets on a regular basis to share information on existing cases and ideas on
how the Attorney General's Office can effectively target fraud and abuse on the CA/T Project. As a result
of these meetings, information concerning CA/T Project matters flows freely and timely across bureau
lines, resulting in the sharing of relevant information and ideas, the avoidance of conflicts, and the designation
of proper resources to each matter. The CA/T Project Director and the representatives from each bureau
devoted significant time in the past fiscal year sharing information about and coordinating CA/T Project
investigations and prosecutions.

The CA/T Project Director also spent significant time during the past fiscal year as a liaison to other
state and federal law enforcement agencies with oversight responsibilities for the CA/T Project. More
specifically, the CA/T Project Director served as the representative from the Attorney General's Office on
the Oversight Coordination Commission, which is statutory empowered with certain oversight
responsibilities for the CA/T Project. While the offices that make up the Commission differ in their
statutorily power and expertise, the Commission provides a forum in which members can communicate
ideas, share information, and coordinate CA/T Project oversight activities. The CA/T Project Director
devoted significant time to the activities of the Oversight Coordination Commission in Fiscal Year 2002.

Finally, the CA/T Project Director spent significant time in the past fiscal year working cooperatively
with the CA/T Project's legal counsel to design and implement measures to prevent and/or detect fraud
and abuse on the CA/T Project.

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GOVERNMENT BUREAU

Administrative Law Division
Trial Division

GOVERNMENT BUREAU

Government Bureau

The Government Bureau provides representation for the Commonwealth and its agencies and officials
in all types of civil litigation, and for employees of the Commonwealth with respect to certain civil
claims made against them resulting from the performance of their duties. The bureau also provides
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, in Fiscal Year 2002 the bureau continued 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.

The Government Bureau consists of an Administrative Law Division and a Trial Division. During
Fiscal Year 2002, several attorneys were assigned permanently to work in both the Administrative Law
and Trial Divisions, and a sampling of cases from each division was assigned 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.
Both divisions initiated affirmative litigation on behalf of state agencies and the Commonwealth and
submitted briefs amicus curiae in cases presenting issues of law affecting the Commonwealth's interests.

The Administrative Law Division defends suits concerning the legality of governmental operations,
particularly those seeking injunctive or declaratory relief. The division is also responsible for 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 torts, real estate matters, contract-related disputes, employment disputes,
civil rights violations, 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.

During Fiscal Year 2002, the Government Bureau included Stephanie Lovell, Division Chief; Sherrie
Costa; Peter Sacks; and Ernest Sarason. Staff members assigned to particular divisions within the
Government Bureau are listed below.

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GOVERNMENT BUREAU

In Fiscal Year 2002, in addition to the outreach activities undertaken by members of particular divisions
as described below, Government Bureau attorneys offered a training for Department of Revenue attorneys
and other staff regarding the public records law, the Fair Information Practices Act, the attorney-client
privilege, and the work-product doctrine; spoke to a group of visiting Chinese legal scholars regarding the
organization of the Attorney General's Office and the relationship of state agencies to the state and federal
courts; served as faculty in a continuing legal education course concerning privilege issues; and held a
meeting for all state agency counsel for the discussion of topics of mutual concern to the Attorney
General and agency counsel.

SIGNIFICANT CASE SUMMARIES

AFFIRMATIVE LITIGATION

Both the Administrative Law Division and the Trial Division initiate affirmative litigation on behalf
of the Commonwealth when such litigation is in the public interest; furthers the Attorney General's
priorities; and has a significantly high monetary value or raises legal or policy issues of concern to the
public and the Commonwealth. The Government Bureau maintained an active docket of affirmative
litigation in Fiscal Year 2002 to protect the public interest and the interests of its state agency clients.
Highlights of this affirmative litigation were as follows:

• Commonwealth v. Phillips (Suffolk Superior Court) The Attorney General had filed suit
in Fiscal Year 2000 on behalf of the Teachers Retirement Board, seeking to recover over $800,000
of unearned pension benefits from a retired teacher who had been mistakenly paid those benefits
between 1990 and 1999. After the court appointed a receiver to prevent the concealment or
transfer of the assets of the teacher and her husband, the court entered a consent judgment and
execution against the defendants for nearly $ 1 million. In Fiscal Year 2002 the court approved
the receiver's report recommending transfer of the defendants' attached assets (approximately
$250,000 to $300,000) to the Commonwealth.

• Secretary of the Commonwealth v. AFSCME Council 93 (Suffolk Superior Court) The
Attorney General had earlier filed suit on behalf of the Secretary to vacate an arbitrator's decision
to place a former employee of the Essex County Commissioner's Office in a position with the
Essex Registry of Deeds. In Fiscal Year 2002 the Superior Court vacated the arbitrator's decision.

L28

GOVERNMENT BUREAU

• Ruthardt v. United States (U.S. District Court) The Attorney General, on behalf of the
Commissioner of Insurance acting as receiver of a liquidated insurance company, American Mutual,
had earlier sought declarations that (1) claims by the United States against the estate were subject
to the bar date for claims established by the Massachusetts Supreme Judicial Court and (2) the
Commonwealth may distribute assets to the state insurance guaranty funds as assignees of
policyholders before paying non-policyholder claims of the United States. In Fiscal Year 2002,
the District Court ruled against the Commissioner on the first issue and for her on the second.
The parties cross-appealed to the First Circuit Court of Appeals.

• Bowler v. Hawke. United States Comptroller of the Currency (First Circuit Court of
Appeals) The Attorney General, on behalf of the Commissioner of Insurance, filed a petition
challenging a ruling by the Comptroller of the Currency that federal law preempts state laws
governing the sale of insurance by banks.

• Commonwealth v. National Association of Government Employees (Suffolk Superior
Court) On behalf of the Office of Campaign and Political Finance (OCPF), the Attorney
General had previously filed suit against a union's political action committee that had not performed
its agreement to pay $30,000 in settlement of claims of alleged campaign finance violations. The
Commonwealth dismissed the lawsuit after the committee paid the $30,000 and complied with
the other terms of its agreement with OCPF.

• OCPF v. Healv (Suffolk Superior Court) On behalf of OCPF, the Attorney General sued
an unsuccessful State Senate candidate and his treasurer for violations of the campaign finance
laws. The case was settled following the candidate's payment of $ 1 ,200 to the Commonwealth
and execution of a disposition agreement.

• MDC v. Wood (Worcester Superior Court) The Attorney General filed suit on behalf of the
Metropolitan District Commission (MDC) to prevent the defendant from interfering with work
being performed on the MDC's sewer easement on the defendant's property in West Boylston.
The case was settled by the MDC's agreement to do the work quickly and to forgo any monetary
damages and the defendant's agreement not to interfere with the work.

• MDC v. T Equipment (Suffolk Superior Court) The Attorney General filed suit on behalf
of MDC to recover use and occupancy fees based on the defendant's having continued to occupy
property adjacent to the Neponset River in Milton after the MDC had acquired it for park
purposes.

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GOVERNMENT BUREAU

• Commonwealth v. Hodgdon d/b/a Blue Hills Adventures (Suffolk Superior Court) The
Attorney General, on behalf of MDC, obtained a preliminary injunction preventing the defendant
from advertising and conducting adventure outings on MDC property without having first
obtained the necessary permits from the MDC.

• Commonwealth v. Bettuchi (Land Court) The Attorney General filed suit on behalf of
MDC to obtain authorization to remove the defendant's shed from the MDC property on
which it was encroaching. After a hearing, the parties settled the case by agreeing to a judgment
that authorized the MDC to use reasonable efforts to move the shed off its property.

• Office of Child Care Services v. DeSisto School, Inc. (Suffolk Superior Court) The Attorney
General, on behalf of the Office of Child Care Services (OCCS), filed suit for equitable relief
against the DeSisto School, Inc. and the school's founder. OCCS alleged that the defendants
were operating a residential school for children with special needs without meeting the needs of
the children and without complying with the legal standards for operating a group care facility,
including the possession of an OCCS license to operate a group care facility. OCCS also alleged
that the school's practices and conditions seriously threatened the physical safety and welfare of
the students. The court entered a number of preliminary injunctive orders against the school and
later found the school in contempt of those orders. It also restricted enrollment of any new
students at the school; required compliance with prior court orders as well as full implementation
of OCCS-mandated policies; and required production of required building permits, inspection
certificates, and reports by the end of Fiscal Year 2002.

• Commonwealth v. Goldish-Phipps (Springfield District Court) The Commonwealth
obtained a judgment against a former employee of the Department of Social Services who had
erroneously received nearly $10,000 in direct deposits to her bank account but had failed to
return the erroneous payments to the Commonwealth.

• Division of Administrative Law Appeals v. Chief justice of the Superior Court (Supreme
Judicial Court for Suffolk County) The court granted the Division of Administrative Law
Appeals' petition for an order requiring that Superior Court Standing Order 1-96, governing
judicial review of agency decisions in Superior Court, be modified to reflect that the agency
whose proceedings are being reviewed need not file a transcript of the administrative proceedings
with its answer, unless the plaintiff requests and pays for it in advance.

Government Bureau attorneys also litigated cases through the Attorney General's Abandoned Housing
Project. The project is designed to assist community groups in choosing and appointing their own

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people to take over abandoned houses that, due to the absentee owners' indifference, have created a
health, safety, and crime hazard for the community. The Attorney General assists the community groups
by petitioning the appropriate court for an order permitting the community group to appoint their
receiver and take charge of the blighted property for the benefit of the neighborhood. Once the receiver
is appointed, the receiver and the community group work together on the actual repair and rehabilitation
of the property.

ADMINISTRATIVE LAW DIVISION

The Administrative Law Division has three principal functions: (1) to defend lawsuits against state
officials and agencies concerning the legality of governmental operations, particularly those seeking
injunctive or declaratory relief; (2) to review all newly enacted town by-laws; and (3) to prepare legal
opinions for constitutional officers, heads of agencies, and certain other officials concerning issues arising
from the performance of their official duties. During Fiscal Year 2002, significant events occurred in each
of these areas, as set forth below.

During Fiscal Year 2002, the Administrative Law Division included Judith Yogman, Division Chief;
Luna Bacon; Lydia Badolato; Dena Barisano", Thomas Barnico; John Bowman; Erin Browne; Romeo
Camba; Judith Cassino; Julie Collins; Tina Couch; Pierce Cray; Wanda Devereaux; Sandra Giordano;
Daniel Hammond; John Hitt; Kelli Lawrence; Quinette Littleton; Bernadette Lovell; Maite Macdonald;
Maria Makredes; Pauline O'Brien; Susan Paulson; Anthony Penski; Eva Poole; William Porter; Christopher
Quaye; Robert Quinan; William Reynolds; Juliana Rice; Robert Ritchie; Deirdre Roney; Cynthia Rothaupt;
Adam Simms; Ginny Sinkel; Amy Spector; Steven Thomas; Eva Wanat; Peter Wechsler; Richard Weitzel;
Jane Willoughby; and Sheila York.

SIGNIFICANT CASE SUMMARIES

Highlights of some of the most significant cases handled by the Administrative Law Division in
Fiscal Year 2002, grouped by subject matter, are as follows:

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ELECTIONS

• Bates v. Director of the Office of Campaign and Political Finance (Supreme Judicial
Court) Supporters of the Clean Elections Law brought this action to require the Director of the
Office of Campaign and Political Finance to provide campaign funds to candidates entitled to
receive them, despite the absence of any appropriation of such funds by the Legislature, and to
enjoin the Secretary from holding any elections until such funds had been made available to all
eligible candidates. The Supreme Judicial Court held that, although the Clean Elections Law is
expressly "subject to appropriation," the Legislature is nevertheless required by the amendment
Article 48 to the Massachusetts Constitution either to repeal the law, which was enacted by
initiative petition, or to fund it. The court further held that, by certifying a candidate as eligible
to receive Clean Elections funding, the Director bound the Commonwealth to provide such
funding. By way of relief, the court declined to order the Director to distribute funds, which he
had no authority to do without an appropriation, and also declined to enjoin the Secretary from
conducting elections. Instead, the court directed the single justice to enter a monetary judgment
in favor of one certified candidate and any other candidates who subsequently qualified for such
funding, rejecting the defendants' argument that such judgments were barred by sovereign immunity.
Although the court presumed that the Legislature would appropriate money to pay such judgments,
it authorized the single justice to retain jurisdiction to consider requests for further relief if the
judgments were not satisfied. When the Legislature failed to appropriate money to pay the
judgments, the single justice abrogated the Commonwealth's sovereign immunity and issued
executions, which were ultimately used to seize and sell state property to satisfy the judgments
for 1 1 candidates.

• McClure v. Secretary of the Commonwealth (Supreme Tudicial Court) Chelmsford voters
challenged the constitutionality of the 2001 redistricting plan for the State House of
Representatives, which placed portions of Chelmsford in four representative districts. In upholding
the plan as consistent with state constitutional requirements, the court held that this division of
Chelmsford was justified because it achieved a closer degree of population equality among districts
than would have been achieved under plaintiffs' alternative plan. The court also rejected plaintiffs'
claim that the plan constituted a partisan political gerrymander in violation of the federal equal
protection clause.

• Mayor of Cambridge v. Secretary of the Commonwealth (Supreme Judicial Court) In
another challenge to the 2001 House redistricting plan, Cambridge officials and voters sought to
invalidate the plan's placement of portions of Cambridge in six representative districts. In upholding

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the plan, the court held that plaintiffs had failed to satisfy their burden of demonstrating that the
Legislature's division of Cambridge was unreasonable. The court also opined that the Legislature
properly considered the minority representation requirements of the federal Voting Rights Act in
formulating its redistricting plan.

• Albano v. Attorney General (Supreme Judicial Court) Plaintiffs in this case challenged the
Attorney Generals certification of an initiative petition to amend the Massachusetts Constitution
to limit marriage and marriage-related benefits to opposite-sex couples. In upholding the Attorney
General's certification, the court held that the petition did not contain matters excluded from the
initiative process by amendment Article 48 of the Massachusetts Constitution. In particular, the
court held that the petition was not related to the powers of the courts merely because it would
change the definition of a "valid" marriage and that it did not contain matters that are not related
or mutually dependent merely because it would affect many statutory benefits or responsibilities.

• Tolman v. Finneran (U.S. District Court) The federal court dismissed another attempt to
require the Legislature to fund the Clean Elections Law, finding the case barred by legislative and
sovereign immunity.

POWERS OF THE GOVERNOR

• Levy v. The Acting Governor (Supreme Judicial Court) This challenge to the Governor's
removal of two members of the Massachusetts Turnpike Authority resulted in two decisions of
the Supreme Judicial Court. In the first decision, the court held that the Governor has the power
to remove members of the Turnpike Authority but declined to consider, as unripe, what procedural
and legal standards apply to such removals. In the second decision, the court held that the
Governor's removal authority was limited to removal for "cause," in the nature of malfeasance,
misfeasance, or willful neglect of duty, and that the grounds for discharge here involved, instead,
a difference of opinion over policy. The court therefore vacated the Governor's removal order.

• New England Division of the American Cancer Society v. Commissioner of
Administration (Supreme Judicial Court) In this challenge to the Governor's authority under
G.L. c. 29, § 9C, to reduce allotments for certain expenditures appropriated in the Fiscal Year
2002 budget, the court held that the Governor's authority applies whenever the total available
revenues during a fiscal year are projected to be insufficient to cover the total appropriated
expenditures for that year, even if the particular appropriation for which allotments are reduced is

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from a fund in which there is no projected deficit. The court further held that the statute, as so
construed, was not an unconstitutional delegation of the Legislature's authority to appropriate
funds.

• Teamsters Local Union No. 404 v. Secretary of Administration & Finance (Supreme
Judicial Court) In this labor relations case, the court held that the Governor may enlist aid from
appropriate officials within the executive branch in deciding whether to recommend that the
Legislature fund a collective bargaining agreement, and it is appropriate for those officials to
communicate the Governor's likely position to the bargaining parties.

CHILDREN AND FAMILIES

• Goodridge v. Department of Public Health (Suffolk Superior Court) The court held that
same-sex couples have no statutory or state constitutional right to marry. At the close of the fiscal
year, plaintiffs' appeal from that decision was pending.

• Adoption of Sherry (Supreme Judicial Court) A recently enacted statute gives foster parents
the right "to be heard" at hearings on custody changes or termination of parental rights concerning
a child in their care. In this case of first impression, the court held that foster parents' right to be
heard is constrained by the usual evidentiary rules.

• Culliton v. Beth Israel Deaconess Medical Center (Supreme Judicial Court) The court
held that the Probate Court has jurisdiction to consider a request for a pre-birth order requiring
a hospital to list a child's genetic parents on the child's birth certificate, rather than the gestational
carrier who gave birth to the child. The court further held that such an order should be granted
where (1) the plaintiffs are the only genetic sources of the child; (2) the gestational carrier agrees
with the relief sought; (3) no one else has contested the petition for such relief; and (4) the
plaintiffs have waived any contradictory provisions in the surrogacy contract. The Attorney
General filed an amicus brief in support of the position ultimately adopted by the court.

• Adoption of Olivia (Appeals Court) In this termination of parental rights appeal, the court
held that a parent's right to counsel does not include the right to dictate who will be appointed
and that the lower court did not abuse its discretion and appropriately focused on the best interest
of the child in denying a motion to change counsel.

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• Adoption of Natasha (Appeals Court) In another appeal from the termination of parental
rights, the court held that, although DSS violated its own regulations by placing a child for
adoption with a DSS employee, remand for disqualification of DSS was not required in light of
the strong evidence of parental unfitness.

EMPLOYMENT AND RETIREMENT

• Tri-County Youth Programs. Inc. v. Acting Deputy Director of the Division of
Employment & Training (Appeals Court) In this appeal from the allowance of unemployment
benefits, the court held that a claimant who alleges sexual harassment as the reason for leaving a
job need not show that she took "reasonable steps" to keep her job. The court also rejected the
employer's argument that the claimant assumed the risk of sexual harassment by taking a job
working with emotionally disturbed youths. Accordingly, the court affirmed the agency's decision
that the claimant left her job for "good cause" and was therefore entided to receive unemployment
benefits.

• Sullivan v. Town of Brookline (Supreme Judicial Court) In this case involving reinstatement
of a formerly disabled police officer, the court held that (1) the Public Employee Retirement
Administration Commission properly applied its former medical standards, pending the
promulgation of new regulations; (2) retirees denied reinstatement have no administrative remedies;
and (3) plaintiff had to be retrained before being reinstated. The Attorney General had filed an
amicus brief in support of the position ultimately adopted by the court on the first two issues.

EDUCATION AND HEALTH CARE

• Massachusetts Federation of Teachers v. Board of Education (Supreme Judicial Court)
Under the Education Reform Act, the state Board of Education promulgated regulations requiring
that mathematics teachers in certain public schools take — but not necessarily pass — a mathematics
test as a pre-condition for renewal of their teaching licenses. In this case, the court upheld the
validity of those regulations against a statutory and constitutional challenge brought by a teachers'
union, finding the regulations to be a reasonable means of furthering the legitimate interest of
providing a high-quality public education to all students in the Commonwealth.

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• Rolland v. Cellucci (U.S. District Court) In this class action brought by mentally retarded
nursing home residents, the court held that the defendant state agencies had a duty under federal
law and under a previous settlement agreement in this case to provide "active treatment" to the
plaintiffs and had failed to do so. As a remedy, the court ordered various forms of injunctive
relief. At the end of Fiscal Year 2002, the state officials' appeal from that decision was pending
before the First Circuit Court of Appeals.

• Leopoldstadt. Inc. v. Commissioner of the Division of Health Care Finance & Policy

(Supreme Judicial Court) In this challenge to Medicaid rates for providers of temporary nurses
to nursing homes and hospitals, the Supreme Judicial Court held that the state rate-setting agency
erred in setting industrywide rates, rather than considering the reasonable expenses of each temporary
nursing agency, and in failing to afford temporary nursing providers a reasonable return on equity.

LAND USE

• Zoning Board of Appeals of Wellesley v. Ardemore Apartments Ltd. Partnership (Supreme
Judicial Court) The court held that a developer who received a comprehensive permit to build
low- and moderate-income housing under the Anti-Snob Zoning Act had a continuing obligation
to make some of the apartments available at below-market rates for as long as the housing is not
in compliance with local zoning requirements, regardless of the terms of any construction subsidy
agreements.

• Twomey v. Commissioner of Food & Agriculture (Supreme Judicial Court) In this case
involving the enforcement of an Agricultural Preservation Restriction (APR) on the plaintiff's
property, the court held that the agency erred in presuming that building a house on APR property
would increase the value of the property and make it unaffordable, thereby defeating the purpose
of the Agricultural Preservation Act. The court further held that, in considering a request for
permission to build a house on APR property, the agency could deny a request if the house would
make the property unaffordable or could negotiate for an option to purchase the property at a
price that disregards the value of the house.

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TAXATION

• Bayer Corporation v. Commissioner of Revenue (Supreme Judicial Court) In this appeal
from a decision of the Appellate Tax Board, the court held that, where the Board's decision
turned on the credibility of witnesses, the Board erred by issuing the decision without participation
by the Board member who heard the evidence. This case has implications for all state adjudicatory
proceedings.

• Ace Property & Casualty Insurance Co. v. Commissioner of Revenue (Supreme Judicial
Court) In this tax case, the court struck down a state tax on premiums for crop insurance policies
as preempted by the Federal Crop Insurance Act.

• Boston Towing & Transportation Co. v. Commissioner of Revenue (Supreme Judicial
Court) In this appeal from the imposition of excise taxes for use of tugboats in the
Commonwealth, the court held that tugboats are "boats" within the meaning of the sales and use
tax statutes and that the use tax on tugboats does not violate the commerce or equal protection
clause of the United States Constitution. By upholding the Commonwealth's power to impose
excise taxes on tugboats, this case saved the Commonwealth a significant amount of tax revenue.

UTILITIES

• Town of Andover v. Energy Facility Siting Board (Supreme Judicial Court) The court
upheld the Board's approval of a petition to construct and operate an electrical generating facility
in the Town of Andover. In so ruling, the court found the Board's decision to be supported by
substantial evidence and sufficient findings concerning air emissions, minimization of
environmental impacts, noise, traffic safety, and site selection process. The court rejected the
Town's argument that the Board improperly delegated its decision-making authority to the
Department of Environmental Protection.

• Tofias v. Energy Facility Siting Board (Supreme Judicial Court) In another energy facility
siting case, the court held that a trust that owned vacant industrial property near the proposed
power lines was not sufficiently affected by the environmental impact of the proposed power
lines to have standing to challenge the Board's siting decision.

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• Global Naps. Inc. v. New England Telephone & Telegraph (U.S. District Court) The
court affirmed the Department of Telecommunications & Energy's interpretation of an inter-
connection agreement between two telecommunications carriers.

• MCI Telecommunications Corp. v. Department of Telecommunications & Energy

(Supreme Judicial Court) Rejecting a challenge from a competing telephone company, the court
affirmed the Department's decision permitting another telephone company to reduce certain
rates by eliminating its pay phone subsidy.

PUBLIC RECORDS

• Viriyahiranpaiboon v. Department of State Police (Appeals Court) In this Public Records
Law case, the court held that blood tests in general, and particularly those that reveal genetic
markers, are absolutely exempt from disclosure under the law's exemption for medical information.

• Antell v. Attorney General (Appeals Court) In another Public Records Law case, the court
held that documents from a closed investigation of official misconduct were not exempt from
disclosure under the privacy exemption, but the court remanded for a determination of what
redactions should be made under the investigatory materials exemption and the CORI Law
before the documents were released.

PRISONERS

• Massachusetts Prisoners Association Political Action Committee v. Acting Governor

(Supreme Judicial Court) In this challenge to a prohibition against political fundraising in state
prisons, the court held that prisons are "buildings occupied for state . . . purposes" within the
meaning of a statute prohibiting political fundraising in such buildings and that this prohibition
is reasonably related to legitimate penological interests and is therefore constitutional.

• Longval v. Superior Court Department of the Trial Court (Supreme Judicial Court) The
court upheld the constitutionality of statutes requiring inmates to pay court filing fees in civil
cases.

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STATISTICAL SUMMARY

During Fiscal Year 2002, the Administrative Law Division opened 876 cases and closed 933 cases. At
the close of the fiscal year, 2,044 cases were pending in the division. Cases handled by division attorneys
resulted in 28 reported decisions of the Supreme Judicial Court, 19 reported decisions of the Massachusetts
Appeals Court, five reported decisions of the United States Court of Appeals for the First Circuit, one
reported decision of the First Circuit Bankruptcy Appeals Panel, seven reported decisions of the United
States District Court for the District of Massachusetts, and one reported decision of the Bankruptcy
Court for the District of Massachusetts. In addition, division attorneys were involved in numerous cases
in those courts and in state trial courts that resulted in unpublished decisions.

OUTREACH, EDUCATION, AND TRAINING

During Fiscal Year 2002, in addition to the substantial outreach efforts of the Municipal Law Unit
detailed below, other Assistant Attorneys General in the Administrative Law Division: conducted a training
for hearing officers within the Executive Office of Public Safety and the Sex Offender Registry Board on
conducting adjudicatory hearings and writing decisions; taught a class at Boston College Law School on
Crosby v. National Foreign Trade Council and the effect of foreign trade agreements on state laws;
judged a moot-court competition at Boston College Law School; participated on two panels at Boston
University Law School on public sector employment; and spoke at the annual Middlesex Retirement
Board seminar on retirement law and the workings of the Contributory Retirement Appeals Board.

MUNICIPAL LAW UNIT

The Administrative Law Divisions Municipal Law Unit discharges the Attorney General s responsibility
of reviewing and approving municipal by-laws and by-law amendments from more than 300 towns
throughout the Commonwealth. By statute, the Attorney General is charged with the review of town
general by-laws (G.L. c. 40, § 32), town zoning by-laws (G.L. c. 40A, § 5), town historical district by-
laws (G.L. c. 40C), and city and town Home Rule Charter amendments (G.L. c. 43B).

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With respect to town by-laws, the Office exercises a limited power to disapprove local legislative
action if the proposed amendment is found to be inconsistent with the laws or the Constitution of the
Commonwealth. The Office has 90 days from the date on which it receives by-law amendments from
the Town Clerk in which to conduct its review. The Office will disapprove any amendment, or appropriate
portion thereof, where the amendment is in facial conflict with substantive state law or where mandatory
procedural requirements of adoption are not met.

With respect to Home Rule Charter amendments, G.L. c. 43B prescribes that municipal charters and
charter amendments from any of the 351 cities and towns in the Commonwealth must be reviewed by
the Office, which must render its opinion on consistency with state law within 28 days after receipt of a
proposed charter amendment. The Office is not required to review municipal charters or charter
amendments enacted by the Legislature in special acts.

During Fiscal Year 2002, the most prevalent subjects of local regulation were by-laws regulating
telecommunications facilities, wetlands, open space, agricultural uses and structures, and sexually oriented
businesses. The Municipal Law Unit reviewed a total of 648 general by-laws, of which 560 (86.4%)
were approved, 51 (7.9%) were approved with partial deletion, 10 (1.5%) were disapproved, and 27
(4.2%) were returned with a finding that no action by the Office was required by state law. The Unit
reviewed 848 zoning by-laws, of which 783 (92.3%) were approved, 45 (5.3%) were approved with
partial deletion, 18 (2. 1%) were disapproved, and 2 (0.2%) were returned with a finding that no action
by the Office was required by state law. The Unit reviewed 136 zoning map amendments, of which all
(100%) were approved. The Unit reviewed five historic district by-laws, of which all (100%) were
approved. Finally, the Unit reviewed 14 charter amendments, of which all (100%) were found to be
consistent with state law. During Fiscal Year 2002, the authority conferred by St. 200, c. 299, to waive
minor procedural deficiencies in submissions of by-laws for review, was exercised in over 41 instances, an
increase of 100% from the previous year. In all instances, no objection was filed to the Office's waiver of
the procedural deficiencies, thus allowing the Office to approve amendments that would otherwise have
been disapproved.

Going above and beyond what is required by statute, the Office has chosen to extend the services and
resources of the Municipal Law Unit by providing, time permitting, voluntary informal review of proposed
town by-law amendments and — even though not subject to review by the Office — proposed city
ordinances. During Fiscal Year 2002 the unit experienced a marked increase in the number of calls from
local public officials and members of the general public, many of which related to anticipated changes in
local laws and charters.

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During Fiscal Year 2002, the unit experienced an increase in the number of cases in litigation in which
municipal law issues are involved. Even where the Office has initially elected not to intervene or otherwise
participate in such cases, the unit monitors developments so that the Office may become involved if
warranted by developments in the case. At the close of Fiscal Year 2002, unit attorneys were monitoring
58 such matters, an increase of 16% from the previous year.

Over time unit personnel have gradually increased the unit's outreach efforts by writing and speaking
to groups all around the Commonwealth. Particular emphasis has been placed on working with town
clerks and local planning boards, as both are intimately involved in the substance and procedure of local
legislation. The forms required for the submission of by-laws were completely revised and were presented
and explained at the town clerks' conventions and meetings. Unit personnel attended the Massachusetts
Town Clerks' Conventions to hold classes and to present and explain the changes in the forms used for
submitting the by-law packets. The unit also participated in the 2nd Annual Municipal Law Update
Conference. Unit personnel spoke at over 20 trainings or meetings of organizations concerned with
municipal affairs and published several articles concerning municipal law issues.

OPINIONS

The Attorney General's Office 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. In limited circumstances, less formal legal advice and consultation are 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
that ask generally about the meaning of a particular statute, lacking a factual underpinning, are not
answered.

Formal opinions are not offered on questions raising legal issues that are the subject of litigation or
that concern ongoing collective bargaining. Questions relating to the wisdom of legislation or
administrative or executive policies are not addressed. Generally, formal opinions will not be issued
regarding the interpretation of federal statutes or the constitutionality of enacted legislation. Formal
opinion requests from state agencies that report to a cabinet or executive office must first be sent to the
appropriate secretary for his or her consideration. If the secretary believes the question raised is one that
requires resolution by the Attorney General, the secretary then makes or approves the opinion request.

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During Fiscal Year 2002, the Attorney General's Office issued one formal opinion, a copy of which
appears at the end of this report, addressing the application of the public records law to voter information
contained in the Central Voter Registry established under G.L. c. 51, § 47C.

During the same time period, the Attorney General's Office issued 27 letters providing informal
advice, providing a certification or designation to a federal agency in connection with the Commonwealth's
participation in a federal program, or declining to give advice.

TRIAL DIVISION

The Trial Division is responsible for defending the Commonwealth in civil cases brought against the
Commonwealth and its departments, agencies, and employees in a variety of actions primarily consisting
of tort, eminent domain, employment, contract, civil rights, and land registration actions. Members of
the division analyze each case at the outset to see if the case should be resolved through settlement or in
favor of the Commonwealth by dispositive motion. If not, the case proceeds through the discovery
phase, and the division continues to try to resolve the case through settlement or by filing a summary
judgment motion. Alternative dispute resolution approaches are always considered and are utilized at any
appropriate stage of the case. If the case goes to trial, the Trial Division aggressively defends the
Commonwealth and its employees. The Trial Division has enjoyed impressive results by defending the
Commonwealth and its employees in its trials, resulting in substantial savings to the Commonwealth
and the public.

During Fiscal Year 2002, the Trial Division included David Kerrigan, Division Chief; Dorothy
Anderson; Steven Baddour; Jason Barshak; Matthew Berge; Crispin Birnbaum; John Bowen; Ranjana
(Chand) Burke; Joseph Callanan; Patrick Cassidy; Stephen Clark; Rosemary Connolly; William Daggett;
Stephen Dick; Kristen Donald; Anne Edwards; Janet Elwell; Lisa Fauth; Dorothy Foley; Susan Gaeta;
Norine Gannon; Cynthia Miles Gray", Mary Hall; Michelle Kaczynski; Ronald Kehoe; Angela Lee; Jennifer
Lespinasse; Lucinda Macdonald; Howard Meshnick; Alicia Oladayiye; Holly Parks; Maite Parsi; Frances
Riggio; Beverly Roby; Eric Seyfert; A. Thomas Smith; Mark Sutliff; James Sweeney; Marini Torres-
Benson; Antonette Traniello; Teresa Walsh; Doris White; Jonathan White; Jessica Coccoli Wielgus;
Nathanael Wright; and Charles Wyzanski.

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SIGNIFICANT CASE SUMMARIES

TORTS

Most of the trials conducted by members of the Trial Division involve claims that the Commonwealth
breached a duty of care owed to a member of the public, resulting in injury or property damage. The
following cases are typical of the tort cases tried by members of the division during the course of the year.

• Ho gan v. Department of State Police (Suffolk Superior Court) Plaintiff brought this case
after she had run into the rear end of a state police cruiser after the state trooper had stopped to
assist a motorist. The plaintiff had been drinking before the accident and later admitted to
operating under the influence in a criminal case brought against her. After a five-day jury trial, the
jury returned with a verdict for the state police, finding that the trooper had not acted negligently
by assisting the motorist.

• Frizzi v. Metropolitan District Commission (Suffolk Superior Court) Plaintiff brought
this action alleging that the condition of the ice at the MDC-operated ice rink in Revere caused
her to fall and break her arm. Although the MDC disputed that the plaintiff had offered any
evidence that the condition of the ice resulted in the fall, the jury returned a verdict for the
plaintiff after a three-day trial and awarded her $33,500.

• Hadley v. University of Massachusetts (Suffolk Superior Court) Plaintiff sought to recover
for injuries sustained after slipping in a parking garage, claiming that the University of
Massachusetts had negligently maintained the garage. After a trial, the jury returned a verdict for
the defense.

• Krain v. Commonwealth (Suffolk Superior Court) Plaintiff claimed that the Highway
Department had failed to adequately warn motorists on Route 2 that a drainage culvert was
located off of the side of the road. Plaintiff was injured when she fell into the culvert after she
jumped over a guardrail trying to find a bathroom somewhere in the woods. After trial, the jury
found MHD 50% negligent and awarded the plaintiff $7,000.

Many of the tort cases were also resolved through other means, including settlement and dispositive
motions. The following cases are examples of resolutions achieved through those means:

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• Perelra v. Town of Rehoboth and Commonwealth of Massachusetts (Bristol Superior
Court and Appeals Court) Plaintiffs sought to recover for damages to their home due to what
they claimed was the defective service of an oil burner located in the home. Plaintiffs had already
brought and lost a case against the company that actually serviced the burner. Here they sought
to recover for the negligence of the Town and Commonwealth in that the burner disappeared
after local and state officials removed it from the home as part of an investigation into the cause
of the fire, despite the fact that the plaintiffs failed to give notice to the town or to the state of
their intention to bring an action against the company for over two years after the officials took
custody of the burner. The Superior Court entered summary judgment for the defendants. On
appeal, the Appeals Court affirmed, finding that the plaintiffs could not show either that the
defendants had been negligent in the way they handled the burner or that loss of the burner had
caused plaintiffs to lose their case against the company that serviced the burner.

• Kallio v. Fitchburg State Colleg e (Worcester Superior Court) Plaintiff brought this personal
injury action after he slipped and fell on ice in a parking lot at Fitchburg State College. The
college obtained summary judgment, successfully arguing that the plaintiff had failed to show
that there was an unnatural accumulation of ice and snow in the lot.

• Sidney v. Massasoit Community Colleg e (Plymouth Superior Court) Plaintiff sought
recovery for injuries claimed to have been suffered due to an assault and battery allegedly committed
by college employees. The court allowed the college's motion to dismiss, agreeing that the Tort
Claims Act bars an action for an intentional tort against the Commonwealth or its agencies and
that plaintiff had failed to make proper presentment of the claim against the Commonwealth
because the presentment letter did not specify the theory under which the plaintiff sought to
recover in the complaint.

• Parker v. Balma (Boston Municipal Court) A former state police trooper asserted libel and
slander as well as intentional infliction of emotional distress claims against the defendant, an
internal affairs investigator, for statements made in an Internal Affairs Division report. Plaintiff
had been the subject of much-publicized sexual misconduct allegations concerning incidents on
and off duty. The state police investigated several incidents, the latest of which convinced plaintiff
to take his retirement and a discharge rather than face a trial board. As the case neared trial, the
plaintiff decided to dismiss the case with prejudice without any money being paid to him.

• Kennerly v. Commonwealth (Suffolk Superior Court) Plaintiff claimed that she sustained
injuries from a fall on the Department of Mental Health-owned building steps due to an alleged
unnatural accumulation of ice and snow. After a case evaluation, the case settled for $ 19,000.

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• Linnehan v. Gerry-Sylvia, et al. (Suffolk Superior Court) Plaintiff sought a declaration
that the Committee for Public Counsel Services wrongfully paid a private attorney who was
court-appointed to represent his minor child in probate and juvenile court. After a hearing, the
court allowed CPCS's motion to dismiss for failure to state a claim and for lack of standing and
denied plaintiff's cross-claim for judgment on the pleadings.

• Corbin v. Commonwealth (Suffolk Superior Court) Plaintiff claimed that she slipped on
ice-coated, snow-covered, ridged, and rutted stairs at the Roxbury District Courthouse, fracturing
her left ankle. The Trial Court claimed that proper snow clearing procedures were followed. The
case settled for $ 1 9,500 on the first day of trial after the parties conducted a conference with the
court.

• Cahalane v. Department of Social Services, et al. (Middlesex Superior Court) The plaintiff,
the biological mother of a 2-year-old boy who drowned in a pool at his foster parents' house,
brought this action against the foster parents and DSS for negligence. Due to the potential
exposure to the Commonwealth and to the foster parents, the case settled for $53,000.

CONTRACTS

The division defends the Commonwealth and its agencies in a variety of contract actions consisting
of construction disputes, breach of lease cases, and bid protests. Often these cases are complex because
they involve interpretation of bidding regulations and a complicated statutory framework. These cases
also frequently require the division to defend requests for preliminary injunctive relief which may be
dispositive of the entire case. Unlike tort cases, there is no statutory cap on the potential exposure to the
Commonwealth, so the Commonwealth's liability exposure can be quite large. The following are examples
of the types of contract cases handled by the division and the means of resolution.

• Siemens Building Technologies. Inc. v. Division of Capital Asset Management (DCAM)

(Suffolk Superior Court) This contract dispute involved the application of the public bidding
laws to a project to construct a new student center at the University of Massachusetts. Siemens
claimed that it had been the lowest bidder for the HVAC system and that it had been harmed
when the bid went to a competitor after DCAM decided to use a different system for the building.
Siemens filed this case seeking to enjoin University of Massachusetts from proceeding with the
project without using its product. After a hearing, the Superior Court agreed with DCAM's
argument and denied the preliminary injunction.

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• Mastoran Rest. Inc. v. DCAM (Suffolk Superior Court) This case was brought by a company
affiliated with Burger King, claiming that the bidding process for two public rest area sites on
Route 1 28 unduly favored the winning bidder, McDonald's. The plaintiff sought initially to
enjoin the award of the contract to McDonald's, but the court denied that request. After extensive
discovery, DCAM obtained summary judgment for all defendants.

• TLT Construction Co. v. DCAM (Suffolk Superior Court and Appeals Court) This case
arose out of a claim for extra costs associated with the disposal of debris from the demolition of
buildings at Worcester State Hospital and the elimination of certain asbestos abatement work in
the buildings. DCAM's exposure, with interest, was approximately $3.8 million. A court-
appointed master ruled for the contractor on both issues, and that decision was adopted by the
trial court. DCAM appealed and then settled the matter while on appeal by agreeing to pay the
contractor $2.8 million, essentially equal to the cost of disposal of the debris.

• Dupont Engineering. Inc. v. Commonwealth (Suffolk Superior Court) Plaintiff brought
this action after the Massachusetts Highway Department (MHD) failed to pre-authorize plaintiff
to bid on certain highway projects. MHD took this action after the plaintiff failed to make
payments for details. Plaintiff sought an injunction to reinstate its qualified status, but the court
denied the request.

REAL ESTATE

The real estate cases consist primarily of eminent domain disputes. Like contract cases, there is no
statutory cap that limits the Commonwealth's exposure to damages in these types of cases, so the potential
liability in any case can amount to millions of dollars. Effectively defending these cases results in substantial
savings for the Commonwealth and its taxpayers. The efforts of the Trial Division over the last fiscal year
have resulted in savings of at least $3 million. The following are examples of the types of cases handled
in this area and the manner in which they were resolved.

• Cole v. Commonwealth (Plymouth Superior Court) This case involved taking over 30
acres of land owned by the plaintiffs and their ancestors for hundreds of years. The taking was
made to allow construction of Route 44 between Route 3 and Route 58 in Carver. Plaintiff's
appraiser testified that the taking resulted in damages of $3.4 million; the Commonwealth's
appraiser testified that damages were $780,000. The jury came back with a verdict of $1.4
million, thus saving the Commonwealth over $2 million.

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• Cong re gation of the Sisters of the Divine Providence v. Massachusetts Highway
Department (Plymouth Superior Court) MHD took 36 acres located on Route 80 in Kingston
for the new Route 44 project. The Congregation owns and operates Sacred Heart High School
on part of the property and a summer camp on another part of the property. Plaintiffs claimed
damages in the amount of $ 1 .8 million; their appraiser testified that damages were $1.2 million;
and the Commonwealth's appraiser testified that damages were $440,000. The jury returned a
verdict of $1,040,5 10.

• O'Donnell v. Commonwealth (Essex Superior Court) The MDC took parcels totaling 4.5
acres on Rumney Marsh in Saugus for park purposes. The plaintiff sought damages in the
amount of $616,000, claiming that the land could have been developed as office space, while
MDC's experts testified that the highest and best use of one parcel was as a single-family home
and of the other was for conservation purposes. After trial, the jury returned a verdict of $ 1 50,000,
saving the Commonwealth hundreds of thousands of dollars.

• Corliss v. City of Fall River and Commonwealth (Land Court) Plaintiff sought to acquire
title to land in Fall River alleged to belong to the Seaconke Wampanoag Indian Tribe. The
Commonwealth intervened and joined in motions by the co-defendants asserting that the plaintiff
did not represent the tribe and lacked standing to prosecute this action. After a trial on this issue,
the court found that the plaintiff indeed lacked standing and dismissed the case.

• Barrus v. MDC (Worcester Superior Court) The MDC took one-third of an acre of land in
Holden. Plaintiff testified that the land had a value of $52,000 but then changed that figure to
$44,500; MDC's appraiser testified to a value of $ 1 2,500. After a two-day trial, the jury returned
a verdict for the plaintiff in the amount of $28,000.

• Wellford Corp. v. MHD (Middlesex Superior Court) MHD took three easements on
property in Lexington for purposes of wetlands restoration associated with a project along Route
2A. Waste was found on the property, and MHD incurred clean-up costs for which it will seek
recovery. After mediation, the case settled for a payment of an additional $50,000 to the plaintiff,
and the Commonwealth obtained a two-year extension on the easements, worth more than the
cost of settlement.

• Mobil v. Commonwealth (Middlesex Superior Court) This action arose from a taking in
Sudbury to widen Route 20 at an intersection. Plaintiff claimed damages of $375,000 to
$430,000. The Commonwealth's expert determined that damages were between $ 1 28,000 and

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$172,000, depending on the likelihood of a variance from the Town of Sudbury. The case
settled for $150,000 in additional money being paid to the plaintiff.

EMPLOYMENT, CIVIL RIGHTS, AND OTHER CASES

The division handled numerous employment, civil rights, and miscellaneous cases during the course
of the year. These cases present difficult issues because there is no limit on the monetary exposure and
because such claims frequently are brought against individuals in addition to state agencies. Typical of
such cases handled during Fiscal Year 2002 were the following:

• lohnson v. Comptois (U.S. District Court) The plaintiff alleged that the manner in which
she was physically restrained by mental health workers resulted in a broken arm and a violation of
her civil rights. The defendants included three mental health workers who were involved in the
restraint. After trial, the jury found two of the three defendants had not violated her civil rights.
Thejury found that one defendant was liable but awarded only $5,000 in damages — significandy
less than what had been offered before trial. The trial judge took the unusual step of asking the
Assistant Attorney General handling the case to thank the mental health workers for the hard
work they perform on a daily basis.

• Bryden v. Commonwealth (Suffolk Superior Court) Plaintiffs brought this civil rights
action against the Executive Office of Health and Human Services for the manner in which the
Department of Social Services (DSS) investigated allegations of sexual abuse and neglect at the
plaintiffs' home. The investigation resulted in DSS removing two children from the home. The
defendant sought summary judgment on the grounds that the Commonwealth itself cannot be
sued for civil rights violations and that, at best, the plaintiffs alleged negligence, not any violation
of civil rights. The court agreed and entered judgment dismissing the case.

• Young v. Morrissey (Essex Superior Court) A mental health worker sued the Department of
Mental Retardation and his supervisor for transferring him out of patient care at a DMR facility.
The plaintiff alleged that the transfer constituted sex discrimination and retaliation for filing an
earlier MCAD complaint. DMR defended the case on the basis that there had been an injury to
a patient at the facility, and the transfer was due to a legitimate concern for patient care. After a
six-day trial, thejury returned with a verdict for the defendants.

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• Donahue v. Commonwealth (Suffolk Superior Court) The plaintiff, after being terminated
from employment at the Department of Mental Retardation, brought a variety of claims against
DMR and many of its employees. Plaintiff alleged civil rights violations, violations of the whistle-
blower statute, and various common law tort claims. After two weeks of trial, the jury returned
a verdict for all defendants on all counts.

• Phillips-Fan- v. Commonwealth (Suffolk Superior Court) Plaintiff, who had been employed
by DSS as an area director, brought this race and handicap discrimination action against DSS.
After discovery, the parties engaged in intensive mediation, and a settlement of $250,000 was
reached shortly before trial.

• Cameron v. State Police (Middlesex Superior Court) The plaintiff brought this sexual
harassment claim against the state police and two individuals. The defendants moved for judgment
on the pleadings, arguing that the allegations in the complaint did not show sexual harassment
but, at most, that two individuals had engaged in a personal relationship in the office in which
the plaintiff worked. The court agreed and allowed the motion. The plaintiff subsequently filed
an appeal, which remained pending at the close of the fiscal year.

STATISTICAL SUMMARY

The Trial Division opened 242 new tort cases in Fiscal Year 2002 and closed 154; at the close of the
fiscal year, 908 such cases were pending. The division opened 33 new contract cases and closed 28 during
Fiscal Year 2002; at the close of the fiscal year, 145 such cases were pending. The division opened 103
new real estate cases and closed 101 during Fiscal Year 2002; at the close of the fiscal year, 452 such cases
were pending. The division opened 202 new employment, civil rights, and other miscellaneous cases in
Fiscal Year 2002 and closed 83; at the close of the fiscal year, 384 such cases were pending.

OUTREACH, EDUCATION, AND TRAINING

During Fiscal Year 2002, Assistant Attorneys General in the Trial Division participated in a wide
range of outreach and training efforts, including presenting trainings on how to terminate public contracts,
pre-trial motions, federal civil rights litigation, and public-sector legal careers.

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BUREAU

Civil Rights and Civil Liberties Division

Consumer Protection and Antitrust Division

Environmental Protection Division

Insurance Division

Investigations Division

Division of Public Charities

Utilities Division
Mediation Services Division

PUBLIC PROTECTION BUREAU

Public Protection Bureau

The Public Protection Bureau manages and oversees civil and criminal affirmative litigation on behalf
of the Commonwealth and its citizens; the development of policy, legislative, and regulatory proposals;
and personnel for seven divisions: Civil Rights and Civil Liberties Division, Consumer Protection and
Antitrust Division, Environmental Protection Division, Insurance Division, Investigation Division, Division
of Public Charities.Utilities Division, and Mediation Services Division. The bureau also includes the
Consumer Complaint and Information Section and oversees the Local Consumer Aid Fund, which
provides grants to local community groups to mediate and resolve consumer complaints at the local
level.

The bureau develops and coordinates healthcare policy initiatives to improve the coordination,
enhancement, and expansion of current healthcare policy enforcement efforts. The bureau targets its
efforts to preserve access to affordable, high-quality healthcare responsive to the needs of communities.

The bureau's Mediation Services Division coordinates and staffs Attorney General Tom Reilly's Student
Conflict Resolution Experts (SCORE) Program, a nationally recognized peer mediation program created
to reduce violence in schools and foster safer learning environments for students. In addition, Mediation
Services oversees a Conflict Intervention Team (CIT) of specially trained community mediators, who
mobilize on a moment's notice to provide emergency mediation service to schools in crisis or on the
verge of crisis.

The bureau oversees Attorney General Reilly's Community Benefits Guidelines for both hospitals
and HMOs. Members of the Insurance Division, the Consumer Protection and Antitrust Division, and
the Public Charities Division staff the Community Benefits initiative.

The bureau also has an internal task force of Elder Law Advocates made up of assistant attorneys
general and office investigators in areas of elder law, including long-term care issues, protective services,
financial exploitation of elders, and home healthcare services. These advocates work in conjunction with
the Elder Hotline to address specific elder protection concerns.

The Public Protection Bureau included Alice Moore, Bureau Chief; David Beck; Richard Cole;
Kirsten Engel; Kristy Phillips; Isabel Silva; Linda Tomaselli; and Rose Ursino.

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CIVIL RIGHTS AND CIVIL LIBERTIES DIVISION

The Civil Rights and Civil Liberties Division enforces the Massachusetts Civil Rights Act (MCRA).
The MCRA authorizes the Attorney General to seek injunctive relief when threats, intimidation, or
coercion based on an individual's race, color, national origin, ethnic background, gender, sexual orientation,
disability, age, or religious affiliation interfere with the exercise of that person's civil rights. A violation of
a civil rights injunctive order constitutes a criminal offense, punishable by a maximum of 10 years in a
state prison if the victim suffers bodily injury, or up to two and one half years in a correctional facility if
no bodily injury results.

Division staff continued to participate in the Working Group's task forces to formulate and implement
joint enforcement initiatives in five substantial areas: employment discrimination, bias-related crimes,
housing discrimination, mortgage lending discrimination, and discrimination in public accommodations
based on disabilities.

Members of the Civil Rights and Civil Liberties Division included Cathy Ziehl, Division Chief;
Richard Cole, Senior Counsel; Patricia Correa; Richard Gordon; Phillip Jordan; Rosalind Kabrhel; Jennifer
Keating; Maria MacKenzie; Tina Matsuoka; Brian Monahan; M. Julie Patino; Kathleen Quill; Rene
Reyes; Anthony Rodriguez; and Amanda Ward.

SIGNIFICANT CASE SUMMARIES

POST-SEPTEMBER 1 1TH BACKLASH

This year, the Civil Rights Division used the MCRA aggressively to respond to the spate of violence
directed at persons actually, or perceived to be, of South Asian or Middle Eastern ancestry or of the
Muslim or Sikh faith in the aftermath of the terrorist attacks on September 11, 2001.

• In re: Jeffrey Lizotte. Craig lennings. and a luvenile (Bristol Superior Court) The division
obtained a preliminary injunction on September 28, 2001 against three youths (including one
juvenile) who firebombed a Somerset convenience store owned by a person they believed to be
from the Middle East but who was actually of Indian descent, in retaliation for the September
1 1th terrorist attacks.

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• Commonwealth v. William Hamizides (Middlesex Superior Court) The division obtained
a preliminary injunction on November 19, 2001 against William Hamizides, who went into the
Belmont store of a Greek woman and mistakenly perceived her to be of Arab descent, spewed
racial epithets and threats, and attempted to run the woman and her nephew over with his car.

• Commonwealth v. Amy Lynn Bowman, et al. (Suffolk Superior Court) The division
obtained a preliminary injunction against the defendants on March 12, 2002 for threatening and
physically assaulting an American citizen of Iranian descent in retaliation for the events of September
11th.

• Commonwealth v. Scott Leader (Suffolk Superior Court) The division filed an MCRA
case on December 20, 2001 against Scott Leader following allegations that he entered a Dunkin'
Donuts in South Boston and threatened a store employee of Iranian descent with physical violence,
threw an object at him, and called him a terrorist and other racial epithets.

RACIAL, NATIONAL ORIGIN, AND RELIGIOUS BIAS

The division addressed and responded to violence motivated by bias against a victim's race, national
origin, or religion.

• Commonwealth v. Houlihan (Suffolk Superior Court) The division obtained summary
judgment granting permanent injunctive relief against the defendant in this case alleging assault
and racially charged threats against a Charlestown family on October 17, 2001 .

INTERNET-BASED MCRA VIOLATIONS

An increasing number of complaints to the division involved use of the Internet for engaging in
conduct that violates the MCRA.

• Commonwealth v. Lutz (Middlesex Superior Court) The division requested a preliminary
injunction on June 27, 2002 in this case filed against a male North Reading High School student
after he sent violent e-mails to a co-student containing explicit detailed threats of violence to her,
some other female students, and the mother of one of the students.

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ANTI-GAY BIAS

The division is committed to combating hate crimes directed at individuals based on their actual or
perceived sexual orientation.

• Commonwealth v. Michael Avila (Bristol Superior Court) A final consent agreement was
filed on September 12, 2001 following allegations of anti-gay violence arising from a 1997
incident in which a gay man alleged the defendant attacked him at a rest stop while he was
waiting to use the pay phone.

SEXUAL ABUSE BY CLERGY

The division investigated allegations of sexual abuse by priests in the Roman Catholic Archdiocese of
Boston and the failure of Archdiocese officials to take appropriate action to protect children. The Division
Chief regularly met with Archdiocese officials to encourage the Archdiocese to take certain immediate
remedial measures and met with members of the Cardinal's Commission for the Protection of Children
to provide comments to, and advocate for, further child protection provisions during the development
of the Recommendations for Policies for the Prevention of Child Abuse and the Response to Allegations
of Abuse. The division advocated for accountability provisions, zero tolerance for sex abusers, reporting
of sex abuse to law enforcement, oversight and monitoring of priests previously removed by the
Archdiocese for sex abuse, and extensive training of parents, children, clergy, and non-clergy in identifying
and preventing child sexual abuse.

EMPLOYMENT DISCRIMINATION

Since 1996, the Employment Discrimination Project has focused its efforts on addressing allegations
of systemic employment discrimination practices in the Commonwealth. 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 employees in Massachusetts. Members of the division
also participated in employment-related education, training, and outreach efforts, and filed briefs on
important legal issues in the appellate courts of Massachusetts.

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• Commonwealth v. UNICCQ The division, working with the Equal Employment
Opportunity Commission and the Massachusetts Commission Against Discrimination, executed
a final Conciliation Agreement in this matter alleging sexual harassment of primarily non- English-
speaking female cleaners by male supervisors of UNICCO and inadequate preventive and corrective
company policies and procedures. This case settled for $ 1 million: $500,000 distributed among
seven female employees who claimed to have been subject to sexual harassment and $500,000
toward a claimants fund. The settlement also required UNICCO to hire an independent consultant
to overhaul its employment policies and procedures and an independent monitor to oversee
implementation of the changes.

• Massachusetts Bay Transportation Authority The division executed an extension on January
31, 2002 of this historic, court-enforceable agreement entered into in February 1997 with the
MBTA and 26 of its 27 labor unions to end years of alleged violations of state and federal fair
employment laws and to protect employees from future discrimination, harassment, and retaliatory
conduct, which would otherwise have expired in February 2002. The division reviewed and
analyzed Holland & Knight's Final Report (Review, Assessment, and Recommendations for
Enhancement of the MBTAs Office of Organizational Diversity and Civil Rights and Related
Matters) and other compliance-related documents and information, and identified eight areas of
continued material non-compliance which will be addressed and which the division will continue
to monitor.

• Commonwealth v. Bull HN Information Systems. Inc. (United States District Court)
The division's Employment Discrimination Project, along with the Equal Employment
Opportunity Commission, continued to actively litigate the age discrimination issues in
Commonwealth v. Bull HN Information Systems, Inc. in the United States District Court. The
court entered declarations and ordered relief on a number of the Commonwealth's claims in this
employment case alleging that Bull HN, a large electronics company, violated the federal Older
Workers' Benefits Protection Act (OWBPA) and the federal Age Discrimination in Employment
Act (ADEA) , when laying off its workers age 40 and older.

• Amicus Briefs The division filed amicus curiae briefs in two cases pending on appeal: Sahli v.
Bull HN Information System, Inc. . which raised the issue of whether a cause of action is cognizable
under G.L. c. 15 IB when an employer initiates retaliatory litigation against a former employee
who filed a complaint in the MCAD, and EDI Specialists. Inc. v. Steven A. Mills , which raised
the issue of whether an employer can obtain contribution and indemnification from an employee
accused of sexual harassment under Chapter 151B.

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EDUCATIONAL EQUITY

The division has taken the lead role in the Comfort/Bollen case, attempting to preserve the ability of
local school districts to voluntarily integrate their schools under state law so that students receive the
considerable benefits of learning from and with children from other races and ethnic groups, and are
better prepared for success in racially and ethnically diverse workplaces and communities.

• Bollen v. Lynn School Department, et al. . Comfort v. Lynn School Committee, et al.

(United States District Court) In November 1999, the Commonwealth joined the Lynn School
Committee as a defendant by intervening in Comfort v. Lynn School Committee, et al. , which
was later consolidated with Bollen v. Lynn School Department, et al. . to defend the constitutionality
of the state's Racial Imbalance Law and the City of Lynn's school choice plan, in effect since
1988. The division, with the Administrative Law Division, tried this case over 1 1 days in the
United States District Court, in June 2002.

HOUSING DISCRIMINATION

The division enforced 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.

Through offering training programs and prosecuting housing discrimination cases, the division worked
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.

• Commonwealth v. Arlington Housing Authority On July 27, 2001, the division obtained
court approval of the Settlement Agreement in this case alleging that the Arlington Housing
Authority failed to make a reasonable accommodation to a mentally disabled girl and failed to
properly investigate claims of sexual harassment against the girl by male tenants. The case settled
for $32,500 and prohibitory and affirmative injunctive relief, including training and adaptation
of new policies and procedures.

• Commonwealth v. Hunneman & Co. and Ivanova (Worcester Superior Court) Final
Judgment by Consent was filed on November 14, 2001 in this case alleging discrimination on
the basis of race and color for failure to convey a black prospective purchaser's bid to buy a house,

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PUBLIC PROTECTION BUREAU CIVIL RIGHTS AND CIVIL LIBERTIES DIVISION

prohibiting submission of a higher offer, and refusing to negotiate. Case settled for $27,500 in
damages and prohibitory and affirmative injunctive relief.

• Commonwealth v. Charlotte Troy (Middlesex Superior Court) Final judgment was entered
on January 18, 2002 in this case alleging discrimination based on disability where the landlord
unlawfully evicted the plaintiff while he was in the hospital receiving medical treatment. Case
settled for $30,000 and injunctive and affirmative relief.

• Commonwealth & Shauna Lynn v. Richard Kowalski & Columbia Delta Co. (Western
Division, Housing Court) Consent decree filed in this case alleging that the defendants made
discriminatory statements indicating a preference against renting to a family with children, imposed
different terms and conditions on the tenancy because young children shared the rental premises,
and retaliated against the complainant by initiating eviction proceedings against her when she
complained about the discriminatory practices. Case settled for $25,000 and affirmative injunctive
relief.

• Commonwealth v. Quincy Housing Authority (Norfolk Superior Court) Settlement
Agreement and Stipulation of Dismissal entered on September 27, 2001 in this case alleging that
the Quincy Housing Authority failed to investigate claims of sexual harassment of a tenant by
one of its employees.

• Commonwealth v. Douglas King Builders. Inc. (Bristol Superior Court) Settlement of
case filed in December 2001 in which an African- American college student alleged that the
defendants refused to renew his lease because of his race/color. Case settled for monetary relief
and limited affirmative injunctive relief.

• In re: Norwood Garden Apartments. Chestnut Hill Realty This case, which involved
allegations of housing discrimination against a Section 8 recipient, was settled before filing in
court for $3,000 and injunctive and affirmative relief on February 26, 2002.

• In re: Betty and George Strickland v. AAA Apartment Rentals Settlement, before suit,
was entered into on June 19, 2001 for $4,000 in damages with both affirmative and prohibitory
injunctive relief in this case alleging discriminatory failure of a rental agent to lease an apartment
to African-American complainants based on their race, color, and status as recipients of public
assistance.

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• Commonwealth v. Rolls Realty (Middlesex Superior Court) Final Judgment by Consent in
this housing discrimination case based on familial status, in which the plaintiff alleged that
defendant refused to rent her an apartment because she had a child under the age of 6. Case
settled for money damages and prohibitory and injunctive relief.

REPRODUCTIVE CHOICE

The division worked to safeguard the right to reproductive choice, including outreach to police
departments in jurisdictions containing a free-standing reproductive healthcare clinic to offer training on
the buffer zone law, G.L. c. 266, Section EV2.

• McGulre v. Reillv (First Circuit Court of Appeals, United States District Court). The
division continued to defend against this complaint filed in federal district court challenging the
facial constitutionality of the state buffer zone law, G.L. c. 266, Section 120EV2. The First
Circuit reversed the District Court's ruling of November 20, 2000, declaring the statute
unconstitutional and preliminarily enjoining its application. The division continued to defend
the remaining "as applied" challenge to the constitutionality of the statute still pending in the
District Court.

PUBLIC ACCOMMODATIONS

The division enforced the laws ensuring the right of the citizens of the Commonwealth to equal
access to places of public accommodation, regardless of race, color, religion, national origin, ethnic
background, gender, sexual orientation, or disability.

• Commonwealth v. Haverhill Country Club (Appeals Court, Suffolk Superior Court) The
division continued to respond to challenges by Haverhill Golf & Country Club (HCC) to the
October 1999 jury verdict of nearly $2 million awarded to female Club members in this gender
discrimination case, and the Suffolk Superior Court's order in January 2000. The court found
that HCC engaged in a pattern and practice of gender discrimination against its women members
and entered a permanent injunction, as requested by the division, which ordered HCC to cease
discriminating against female members of the Club. In July 2001 the division opposed HCC's
third motion for reconsideration in its request for a new trial and asked the Superior Court to
hold Haverhill Country Club in contempt for violating the court's earlier affirmative injunctive

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relief. The division also opposed the Club's appeal to the Appeals Court seeking to overturn the
jury verdict and court decisions.

• In re: Lobster Boat Restaurant The division settled this matter in which it alleged that
Lobster Boat, a restaurant on the Cape that is open during the spring and summer, discriminated
against several mentally and physically disabled patrons from the Fernald Center who were on a
summer outing, by refusing to serve them. Lobster Boat agreed to provide a $5,000 meal credit
for Fernald Center and to contribute $7,500 to the Fernald trust fund for vacation trips. Lobster
Boat also agreed to train staff on disability issues and develop policies and procedures for addressing
reasonable accommodation requests of persons with disabilities.

• In re: Portuguese-American War Veterans Club (MCAD) The division filed a complaint
alleging sex discrimination in a place of public accommodation when the Portuguese-American
War Veterans Club told a female candidate for Peabody City Council that, although all the male
candidates for city council were invited to the monthly dinner, she would not be allowed to
attend the dinner because it was restricted to men only.

OUTREACH, EDUCATION, AND TRAINING

POST-SEPTEMBER 11TH

The Attorney General collaborated with other governmental and non-governmental agencies and
organizations to respond immediately and effectively to hate crimes in the aftermath of the September
11th attacks.

Post-September 11th Hate Crimes Working Group Immediately after the September 1 1 th
attacks, the Attorney General organized a meeting of the affected communities with state and
federal law enforcement agencies and civil rights groups. More than 100 leaders attended the
meeting. Out of this initial meeting, the post-September 1 1th Hate Crimes Working Group was
organized, consisting of members of the affected populations, state and federal law enforcement
agencies, and civil rights groups. The Working Group broke into subcommittees and regularly
met to discuss initiatives and actions to address hate crimes and acts of discrimination and to
increase cultural understanding of the customs and traditions of Muslims and Sikhs. As part of
these efforts, the division embarked upon an ambitious path directed at addressing hate crimes

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through outreach to, and the training and education of, (1) law enforcement, (2) school officials,
and (3) members of the affected communities in Massachusetts on hate crime identification,
response, investigation, and prevention for this targeted population.

Hate Crimes Training of North Shore Law Enforcement Officers The statewide hate crimes
training team held hate crimes trainings for police officers from municipal and college police
departments on the North Shore and Berkshire County, and delivered the national hate crimes
training module, with modifications to address the aftermath of September 1 1th.

Hate Crimes Training for Civil Rights Officers Serving Communities with Muslim and
Arab Communities On April 24, 2002, the division held a daylong hate crimes training of civil
rights officers designated by departments who serve significant numbers of Arabs and Muslims in
their communities at the Norwood Police Academy Training Facility. The training emphasized
cultural and post-September 1 1 th matters of concern for Arab and Muslim communities in
Massachusetts.

Promoting Tolerance and Respect: A Symposium on Addressing Hate Crimes.
Discrimination, and Harassment The Attorney General organized a symposium held on April
20, 2001 in Lowell and directed at the Middle Eastern, South Asian, Sikh, and Muslim
communities affected by post-September 11th backlash to establish links between these
communities and law enforcement and educate affected communities on their civil rights under
the law.

City of Springfield Violence Prevention Task Force Western Massachusetts Division Chief
Janice Healy co-chaired this task force, which held a "Cultural Awareness/Know Your Rights"
event in January 2002 focused on civil rights issues in the aftermath of the September 11th
attacks.

THE MASSACHUSETTS HATE CRIMES TASK FORCE

Since its inception, the Massachusetts Hate Crimes Task Force has helped law enforcement officials
to more effectively coordinate enforcement activities and share information and expertise on combating
and prosecuting hate crimes in the Commonwealth. The Task Force is now made up of over one
hundred law enforcement officers and prosecutors, community leaders, civil rights advocates, human
rights commission leaders, victim assistance professionals, hate crime researchers, civil rights trainers,

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educators, school diversity/tolerance curriculum specialists, and others who have been working on hate
crime-related issues locally, statewide, or nationally. The Task Force continued to meet over this year.

PowerPoint Training Program The Central Massachusetts Division developed a comprehensive
PowerPoint program on the MCRA that it has presented to a variety of audiences, including
students at the North Reading High School in February 2002, the City of Worcester City Managers
Office in January and March 2002, and social service agencies.

CIVIL RIGHTS IN THE SCHOOLS

The division focused on ensuring the civil rights of students attending schools in the Commonwealth.
The division provided educational training to students, teachers, and administrators on hate crimes and
discrimination, as well as sexual, racial, national origin, and religious harassment in the schools, including
training programs to school administrators and teachers on their liability for failure to properly respond
to hate crime and harassment incidents in the schools. Programs also included how to create comprehensive
civil rights protection programs for students in middle and high schools and respond effectively to hate
crimes on college and university campuses.

Attorney General-Sponsored Civil Rights in Schools Conferences The division organized and
presented A Prerequisite for Safe Schools: Protecting Students from Harassment and Hate Crimes,
the third and fourth in a series of training conferences. The conferences, held on October 11,

2001 for school districts and police from Norfolk and Worcester counties and on March 13,

2002 for Barnstable, Plymouth, and Bristol counties, helped school officials throughout
Massachusetts learn to effectively use the publication Protecting Students from Harassment and
Hate Crime - A Guide For Schools, jointly developed by NAAG's Civil Rights Working Group
and the Department of Justice's Office for Civil Rights. Both the training and the publication
were revised to reflect concerns for the safety of students of actual or perceived Arab, Middle
Eastern, or South Asian ancestry, and children of the Muslim or Sikh faith.

Bullying/Harassment/Hate Crimes Training Program The Western Massachusetts Division,
in collaboration with the Governor's Hate Crimes Task Force and the Springfield Police
Department, presented a training program on January 17, 2002 to vice principals in Springfield
on hate crimes, harassment and bullying, and the development of consistent and effective reporting
systems and investigation processes.

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CIVIL RIGHTS AND POLICE

In a collaborative effort to promote civil rights, assist police departments, and provide departments
with technical assistance, the division offered and provided civil rights training to law enforcement covering
issues of hate crimes identification, response and prosecution, civil liability, sexual harassment, and racial
and cultural awareness.

The division also investigated allegations of police misconduct, and police departments regularly j

consulted with the division for assistance on internal civil rights investigations. The division has closely {

worked with departments to ensure that they take appropriate remedial steps when credible evidence is !
found which substantiates civil rights complaints.

Racial Profiling The division played an increasingly important role in addressing concerns of
improper and illegal motor vehicle stops and street encounters, including racial profiling. This is
an issue where law enforcement nationally as well as in the Commonwealth are increasingly being
requested to play an affirmative role. Members of the division helped organize, in conjunction
with advice from law enforcement leaders, the Attorney General's Working Group on Racial
Profiling to develop a uniform approach to address racial profiling. This working group, composed
of law enforcement leaders and community activists, met at various points over the past year.
Division staff also participated in the Executive Office of Public Safety Working Group on
Racial Profiling and in the Massachusetts Minority Police Officers' Association racial profiling
conference.

DISABILITY RIGHTS

The Disability Rights Project made extensive efforts to protect the rights of individuals with disabilities
throughout the Commonwealth, including litigation, assistance for individuals, training, publications
{Commonly Asked Questions: Employment Rights of Individuals with Disabilities and Fair Housing Rights
of Individuals with Disabilities) , and speaking engagements.

Ensuring Equal Access to Private Businesses In its ongoing effort to make retail and department
stores more accessible for customers with disabilities, the Disability Rights Project continued to
monitor the Assurance of Discontinuance with CVS Stores, which requires them to remedy the
violations of turning radius and aisle width requirements through review of audit reports and site
visits.

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Access to Schools for People with Disabilities The Disability Rights Project also sought to
ensure access compliance for individuals with disabilities in the design and construction of new
schools. An advisory on accessibility in new school construction was sent to Massachusetts'
school superintendents on November 30, 2001.

CIVIL RIGHTS INITIATIVES WITH NAAG

Division members continue to serve in leadership positions in the National Association of Attorneys
General's (NAAG) Civil Rights Working Groups, consisting of representatives of state Attorneys General
from throughout the country working to enhance the cooperative relationship between the states and the
U.S. Department of Justice and the Equal Employment Opportunity Commission in civil rights
enforcement. In early October 2001, the Division Chief helped organize a meeting in Washington of
civil rights members of various Attorneys General's Offices and members of federal agencies, including
the Department of Justice and the EEOC, to share information and to discuss methods of addressing
backlash and violence directed at persons of Middle Eastern and South Asian descent or of the Muslim or
Sikh faith.

CONSUMER PROTECTION AND ANTITRUST DIVISION

The Consumer Protection and Antitrust Division (CPAD) is the leading voice in the Commonwealth
for consumers who have been disadvantaged by unfair or deceptive acts or practices in the marketplace.
The division enforces both state and federal consumer protection and antitrust laws by investigating and
prosecuting civil cases involving a wide array of consumer and competition issues. CPAD also promulgates
consumer protection regulations, mediates consumer complaints against businesses, and provides
information to the public through Attorney General Reilly's Consumer Hotiine, advisories and information
on the Attorney General's Web site, distribution of brochures on a number of issues affecting consumers,
and speaking engagements across the Commonwealth.

Through the Consumer Complaint and Information Section (CCIS) , the division acts as a resource
for consumers and businesses, providing information, direction to additional resources at the state and
federal levels, and free mediation services to consumers who have encountered a problem in a purchase of
consumer goods or services. The division also provides grants to a statewide network of 19 Local Consumer
Programs (LCP) and nine Face-to-Face Mediation Programs, to furnish information and mediation
services across the state. The information gathered by CCIS and the LCPs is available to the division for
review and evaluation for possible legal action. Many cases brought by the division over the years have

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had their genesis in CCIS and the LCPs, and patterns of unfair or deceptive conduct revealed by these
cases have also served as the basis for draft legislation (including anti-SPAM, identity theft, and telemarketing
fraud) and regulations (including travel services and long-term care facilities).

In addition to investigating and prosecuting abuses within Massachusetts, the division also addresses
regional disparities, as well as consumer protection and antitrust issues that may have a nationwide effect.
The division works closely with other states to investigate and file cases addressing unfair or deceptive
conduct, or antitrust issues, in areas such as predatory lending, privacy, health fraud, tobacco sales,
pharmaceutical pricing, and high-tech industries.

During Fiscal Year 2002, CPAD staff included Freda Fishman, Division Chief; Jesse Caplan, Deputy
Division Chief, named Chief in November 2001; Chris Arabia; Michael Atleson; Steve Bandar; Andrea
Breton; Jack Christin; Emily Coleman; Arlie Costine-Scott; James D'Amour; Barbara DeSouza; Mary
Freeley; Jennifer Galante; Brian Goodwin; Michael Hering; Stephanie Kahn; Glenn Kaplan; Brenda
King; Mark Kmetz; Pam Kogut; Diane Lawton; Ronnie Lee; Carmen Leon; Betty Maguire; Mary
Marshall; Lois Martin; Rose Miller; David Monahan; Rory Neal; Janis DiLoreto Noble; Margaret O'Brien;
Mark O'Connor; Donna Palermino; Astrid Pamameno; Julie Papernik; Judy Risch; Jessica Roberts;
Betsy Sawyer; Lisa Senay; Ransom Shaw; Andria Simon; Lorraine Smith; Michelle Stone; Christine
Sullivan; Erika Tarantal; Judy Whiting; Geoffrey Why; Marvina Wilkes; and Hermen Yee.

SIGNIFICANT CASE SUMMARIES

CPAD filed or concluded the following significant cases in Fiscal Year 2002.

HEALTH CARE

• Mylan Laboratories (U.S. District Court, DC) On February 1, 2002, the federal district
court approved a multi-state settlement against generic drug manufacturer Mylan Laboratories
for fixing the prices of lorazepam and clorazepate (drugs used to treat Alzheimer's and other
conditions). The settlement provided consumers with 100% restitution and reimbursement for
overpayments made by the Commonwealth's Medicaid program. In June 2002, over 6,000
Massachusetts consumers received a total of $676,717 in restitution, and the Commonwealth's
Medicaid program received $246,270 in reimbursement.

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• Bristol-Myers Squibb (BMS) Litigation (U.S. District Courts, DC and NY) In November
2001 , CPAD joined over 20 other state Attorneys General in filing suit against BMS relating to
improper attempts to extend its patent monopoly over its Buspar anti-anxiety medication. The
lawsuit, filed in federal court in New York, included allegations that BMS perpetrated fraud on
both the Patent Office and the FDA in its attempts to bar generic competition. In June 2002,
CPAD joined approximately 30 other state Attorneys General in filing suit against BMS in
federal court in Washington, DC, in connection with similar allegations relating to its Taxol
cancer drug.

• Commonwealth v. Bristol Nursing Home (Suffolk Superior Court) In September 2001,
this nursing home, facing financial difficulties, filed for bankruptcy. In cooperation with the
Department of Public Health, CPAD was successful in obtaining a court order appointing an
independent receiver to oversee the orderly closure of the facility and safe transfer of residents to
other facilities. The division also continued to prosecute its civil action against the facility for
regulatory violations and financial abandonment.

• Commonwealth v. Shirley Manor/Greenwood Terrace (Suffolk Superior Court) In June
2000, in cooperation with the Department of Public Health, CPAD was successful in obtaining
a court order appointing an independent receiver to oversee the orderly closure of the Greenwood
Terrace Nursing Home in Brockton, because of a jeopardy situation involving substandard care
provided to the residents. In January 2001, CPAD obtained a default judgment against the
company for approximately $ 1 million in civil penalties.

INTERNET AND HIGH TECH

• Commonwealth v. Robert Todino, d/b/a RT Marketing (Suffolk Superior Court) In
August 2001, CPAD filed an Assurance of Discontinuance against Robert Todino and RT
Marketing for deceptive claims in e-mail solicitations involving offers of "free" government grants
or "detective" software that would allegedly enable the purchaser to discover private information
about others. The Assurance included a $5,000 penalty, prohibitions on future deceptive acts,
and refunds to all consumers who lost money.

• Commonwealth v. Sharon Hunt (Worcester Superior Court) In October 2001 , the court
entered a default judgment against Sharon Hunt, ordering her to pay $5,603 in restitution and
$5,000 in civil penalties for fraudulent practices in connection with selling items on Internet
auction sites.

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PRIVACY

• E gghead.com. Inc. (United States Bankruptcy Court, San Francisco, CA) In September
200 1 , CPAD attorneys acted as lead counsel for a number of states (California, Maryland, Vermont,
Kansas, Iowa, Pennsylvania, Nevada, Oregon, and Florida) in filing and arguing objections before
the United States Bankruptcy Court in San Francisco to motions of Egghead.com to sell its
customer database to the highest bidder, along with other of its Web site assets. Egghead. corn's
Web site promised consumers that it would never share information with third parties. CPAD
took the position that the sale or transfer of consumer information to a third party therefore
required affirmative consent by the consumer through an "opt-in" notice. In December 2001 ,
Egghead assets were bought by Amazon.com, which agreed, in a settlement, for a third party to
hold the customer list until customers provided opt-in consent.

• Essentlal.com. Inc. (United States Bankruptcy Court, Boston) Essential.com operated a
Web site from which consumers could purchase Essential's services, and had a privacy policy
posted that promised consumers it would not share or sell their customer information except in
certain circumstances. The company filed for bankruptcy protection, and in June 2001 , CPAD
and the Utilities Division filed objections to the transfer of the customer information. CPAD
obtained a stipulation endorsed by the Bankruptcy Court that required the successful bidder to
notify consumers in the manner contemplated by federal and state law about the termination of
services by Essential. The order also provided other consumer privacy protections.

• Commonwealth v. Source One/Peter Easton (Suffolk Superior Court/Supreme Judicial
Court) On January 19, 2000, after a full trial, judgment was entered against information broker
Peter Easton and his company, Source One, for using deceptive practices to obtain private financial
information of hundreds of Massachusetts consumers without their consent or knowledge. The
defendants appealed the judgment, but the Supreme Judicial Court, in February 2002, affirmed
the trial court judgment against the defendants, including penalties and costs totaling $6 10,000.
The division is seeking to execute on that judgment.

ELDERS

• Caron Funeral Home (United States bankruptcy court, Worcester) In July 2001, CPAD
assisted in finalizing a setdement and Bankruptcy Court order resolving claims against this funeral
home for failing to keep in trust pre-need funeral deposits paid by elderly consumers, as required

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by Massachusetts law. The resolution included, among other things, refunds totaling $ 130,000
for 3 1 consumers.

• Commonwealth v. Bick & Curry Funeral Home (Suffolk Superior Court) In February
2002, CPAD filed suit against the Bick & Curry Funeral Home seeking restitution for consumers
who had paid over $98,000 in pre-need funeral deposits after those deposits could not be accounted
for, in violation of state law.

CONSUMER CREDIT AND PREDATORY LENDING

• Commonwealth v. First Alliance Mortg a ge Company (FAMCO) (Suffolk Superior Court/
United States Bankruptcy Court, California) In 1998, CPAD filed a lawsuit against FAMCO, a
sub-prime mortgage lender, for charging usurious interest rates and fees (points in excess of 20%
of the loan), and doing so through deceptive sales practices. With assistance from the state
Division of Banks, CPAD obtained a preliminary injunction preventing the company from
violating Massachusetts law. The company, which operated a branch office in Wellesley in 1997
and 1998, closed its doors soon after. In 2000, after FAMCO filed for bankruptcy protection in
California, CPAD continued to pursue the mortgage lender to seek restitution for harmed
consumers. Five other states, the Federal Trade Commission (FTC), and several private plaintiffs
also joined the federal litigation. In March 2002, FAMCO agreed to settle the charges by paying
$60 million in restitution to consumers nationwide. As a result of the settlement, over 275
Massachusetts borrowers will be receiving substantial restitution.

• Commonwealth v. Triad Discount Buying Services (Suffolk Superior Court) In this multi-
state/FTC case, defendants were alleged to have deceptively imposed unapproved charges on
consumers' credit and debit cards for discount buying and travel clubs. A settlement was reached
and filed in October 2001, which provided partial refunds for over 5,000 Massachusetts
consumers, totaling $164,204.

TELEMARKETING AND SWEEPSTAKES

• Commonwealth v. Publishers Clearing House (PCH) (Suffolk Superior Court) On
October 10, 2001, a Consent Judgment against PCH was entered in Superior Court, settling
allegations of unfair and deceptive conduct in the operation of PCH's sweepstakes. The setdement,

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involving Massachusetts and 25 other states, required PCH to pay a total of $34 million toward
restitution, costs, and fines, and to dramatically change the way it conducts its solicitations for
the sale of magazines and other goods, by "sweepstakes" offer, to the benefit of all consumers.
Massachusetts victims will be sharing approximately $800,000 in restitution, and the
Commonwealth will be receiving over $100,000 in fees and costs.

• Commonwealth v. Allied Lighting Products. Inc. (Suffolk Superior Court) CPAD first
filed a lawsuit against Allied in 2000, alleging violations of the Massachusetts Consumer Protection
Act and the federal Telemarketing Sales Rule for deceptive telemarketing practices in selling
overpriced light bulbs to businesses across the country. In March 2001, CPAD obtained a
preliminary injunction against Allied ordering the company to cease deceptive telemarketing
practices and record its sales calls. Rather than attempt to comply with the court's injunction,
Allied elected to shut down operations in April 2001 . In May 2002, the company agreed to a
Consent Judgment, filed in Suffolk Superior Court, requiring it to pay $550,000 in civil penalties
and costs, and $50,000 in restitution.

OTHER CONSUMER PROTECTION

• Commonwealth v. Stop & Shop (Suffolk Superior Court) In October 200 1 , CPAD obtained
an Assurance of Discontinuance, filed in Suffolk Superior Court, enjoining Stop & Shop's
deceptive use of the USDA shield in advertisements for poultry and other products. Stop &
Shop also agreed to a civil penalty of $75,000 and a payment of $20,000 to the Local Consumer
Aid Fund.

• Commonwealth v. Peapod (Suffolk Superior Court) In December 2001, Stop & Shop,
through its online/home delivery sales subsidiary, Peapod, agreed to discontinue certain advertising
policies regarding its pricing of items offered for sale on the Peapod Web site. The settlement,
filed as an Assurance of Discontinuance in Suffolk Superior Court, required Peapod to pay $50,000
in penalties and fees to the Commonwealth and $200,000 in restitution to consumers who were
charged more than the in-store Stop & Shop price for items purchased through Peapod.

• Commonwealth v. Uni-Kleen International (Suffolk Superior Court) In February 2002,
Uni-Kleen International, New England's Finest Carpet Cleaners, and their principal, Ed Pero,
entered into a Consent Judgment resolving allegations that they had participated in a bait-and-
switch scheme, targeting many elders, involving carpet and duct cleaning services. The defendants
offered carpet and duct cleaning at low "per room" fees but then engaged in sales practices that

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caused consumers to pay many hundreds of dollars more for the services. The Consent Judgment
required Uni-Kleen to pay $80,000 in restitution to harmed consumers and $40,000 to the
Commonwealth in civil penalties.

• Commonwealth v. Dean's Home Furniture and Planned Furniture Promotions (Suffolk
Superior Court) In May 2000, CPAD filed suit against a furniture retailer and furniture liquidator
for running a deceptive store closing sale, alleging violations of the state's "going out of business"
statute. In December 200 1 , defendants entered into a Consent Judgment that required them to
agree to significant injunctive relief, as well as payments of $230,000 in restitution to over 2,000
consumers and $40,000 in civil penalties and costs.

• Commonwealth v. The Mandatory Poster Agency (Suffolk Superior Court) In 2001,
CPAD filed an Assurance of Discontinuance against this Michigan-based company that deceptively
marketed posters for businesses that provided notices required by law on wages and hours and
other working conditions. Solicitations led complainants to believe that the company was
somehow connected to a government agency.

• Commonwealth v. Lord & Lady Bridal (Suffolk Superior Court) In February 2002, CPAD
filed suit against the owners of a Belmont bridal shop who shut down without warning, leaving
23 area brides and bridesmaids with either the wrong dress or deposit slips for dresses that were
never delivered. In April 2002, the defendants entered into a Consent Judgment and agreed to
provide complete refunds, totaling over $5,000, to all harmed consumers.

• Commonwealth v. Firestone (Suffolk Superior Court) In November 2001, acting with
approximately 40 other states, CPAD filed an Agreed Final Judgment with Bridgestone/Firestone,
Inc., resolving claims that the company sold defective tires and then made misrepresentations
during the tire replacement process. Under the terms of the judgment, Bridgestone/Firestone
agreed to provide consumer education, including clear and conspicuous tire safety information,
on the tire sidewall or invoices. The company also paid $530,000 to the Local Consumer Aid
Fund.

ANTITRUST

• Microsoft Antitrust Litigation (United States Circuit Court/United States District Court,
DC) CPAD continued to participate in this ongoing multi-state and Department of Justice
(DOJ) litigation against Microsoft for monopolizing the operating systems market and other

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predatory practices. On June 28, 2001 , the D.C. Circuit unanimously affirmed the trial court's
finding that Microsoft had engaged in illegal monopolistic practices, but vacated the trial court's
decision to break up the company and remanded to the trial court for further proceedings on
remedies. In November 2001, DOJ and several states agreed to a proposed settlement with
Microsoft. Massachusetts and eight other states refused to settle and then filed their own remedies
proposal with the court. Following an expedited discovery schedule and several legal motions,
federal district court Judge Colleen Kollar-Kotelly, beginning on March 18, 2002, held a 32-day
evidentiary trial on an appropriate antitrust remedy. At the conclusion of the trial, Judge Kollar-
Kotelly issued a legal decision affirming the states' authority to pursue stricter remedies. As of the
end of Fiscal Year 2002, the court had not yet rendered a decision on the appropriate remedies.

• Contact Lens Antitrust Litigation (U.S. District Court, FL) On May 22, 2001,
Massachusetts and 31 other states announced a settlement with Johnson & Johnson, resolving
claims that the company, along with Bausch and Lomb and an optometrists' association, had
engaged in an illegal antitrust conspiracy that prevented consumer access to discount contact
lenses. The settlement obtained final court approval later in the year. The settlement followed a
March 2001 trial against Johnson & Johnson brought by the states. The $60 million settlement
requires Johnson & Johnson to make $30 million available in cash payments to consumers and
$30 million in guaranteed consumer benefits.

• Suiza Milk/Stop & Shop Transaction (U.S. District Court, MA) On July 9, 200 1 , CPAD,
along with the Attorneys General in Connecticut and Vermont, obtained a Consent Judgment
against Suiza and Stop & Shop, stemming from their agreement relating to the processing and
sale of milk. The Consent Judgment, which was joined by other New England states, ordered
Suiza to make available 30 million gallons of its milk processing capacity to competitors, which
should help increase price competition in the school milk bidding area. Suiza also agreed to pay
Massachusetts $83,000 for costs incurred in the case.

• CD Antitrust Litigation (U.S. District Court, ME) In November 2000, CPAD joined over
40 other State Attorneys General in filing an antitrust lawsuit against the major record companies
and music retailers, alleging an illegal conspiracy to prevent discounting in the sale of music CDs.
During this fiscal year, CPAD, as part of this multi-state effort, continued to litigate this matter.

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TOBACCO

• Commonwealth v. Walgreens (Suffolk Superior Court) In February 2002, Massachusetts
and 40 other states resolved allegations against Walgreens pharmacy arising from its tobacco sales
practices. Under the settlement, filed as an Assurance of Discontinuance, Walgreens agreed to
institute procedures designed to reduce the sale of tobacco products to minors, including specific
policies for hiring and training employees and a "secret shopper" program to check for underage
sales. The company paid a total of $320,000, with approximately $ 10,000 paid to Massachusetts.

• NPM Enforcement (Suffolk Superior Court) Ten lawsuits were brought against tobacco
companies identified as Non-Participating Manufacturers (NPMs) under the Tobacco Master
Settlement Agreement, for their failure to comply with M.G.L. c. 94E, which requires NPMs to
fund escrow accounts to pay judgments or settlements in actions brought against them by the
Commonwealth. The actions sought escrow payments, civil penalties and injunctions against
sales in Massachusetts.

STATISTICAL SUMMARY

Penalties/Costs/Other Money Returned to the Commonwealth $1 ,927,028

Consumer Restitution Recovered

CPAD/CCIS $1,935,806

Local Consumer Programs $5,090,450

Consumer Hotline Calls

CCIS 103,075

Local Consumer Programs 200,000+

Consumer Complaints Filed

CCIS 4,595

Local Consumer Programs 10,934

Tobacco Settlement Payments: The Commonwealth received more than $304 million in Fiscal
Year 2002 in payments under the 1998 tobacco litigation settlement, bringing the total amount received
to more than $873 million. CPAD attorneys closely monitor and enforce the settlement to ensure that
the Commonwealth receives its full share of the annual payments.

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SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

Post-September 1 1th Initiatives In the wake of September 1 1th, CPAD identified and addressed
a number of consumer-related issues, including travel cancellation and refund policies, deceptive
schemes by online marketers peddling anti-bio-terrorism and anthrax-related products, and
concerns about safe mail handling. CPAD addressed these by: (1) issuing consumer advisories
regarding travel cancellations and refunds (September 19, 2001), and information regarding
anthrax, online purchasing of Cipro and other pharmaceuticals, and safe mail handling procedures
(October 29, 2001); (2) initiating investigations into Grand Circle Travel, a major Massachusetts
charter company that imposed inconsistent cancellation and refund policies, along with inadequate
customer service practices, in the wake of the September 1 1 th events, and obtaining over $ 1 00,000
in consumer restitution; and (3) initiating a "surf" of deceptive online offers for various anthrax-
and bio-terrorism-related products and treatments, and later joining both NAAG-and FTC-led
efforts to identify and shut down these sites.

Springfield Health Care Report On October 3, 2001 , the Office formally issued the Attorney
General's Report to the Legislature on the Springfield Health Care Market. The report focused
primarily on antitrust issues but also on issues involving Medicaid reimbursement and patient
information and choice (in addition to the Charities Division issues) in the provision of hospital
and other medical services. The findings and recommendations in the report serve as a guide for
analyzing similar issues in other healthcare markets across the state.

Internet Initiatives CPAD initiated Internet Fraud Sweeps targeting companies using the Internet
for lending and credit scams, weight loss scams, business and work-at-home schemes, AIDS and
cancer cures, and violations of the Children's Online Privacy Protection Act (COPPA). CPAD
also issued consumer advisories relating to Internet safety tips for children and parents, and tips
for dealing with SPAM.

Privacy Working Groups CPAD worked closely with Attorneys General's Offices around the
country in identifying and addressing issues relating to privacy concerns, focusing on financial
and online privacy issues.

Consumer Protection Education/ Advisories CPAD sponsored several National Consumer
Week initiatives in February 2002, including a Consumer Survival Kit — Tips and Techniques in
an Economic Downturn. CPAD also issued consumer alerts and warnings relating to a bogus tax
refund e-mail targeted at the African-American community and an alert warning consumers
about an identity fraud scheme involving a fake IRS form seeking personal information.

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Amicus Curiae CPAD submitted two amicus curiae briefs to state courts, including a brief in
support of the consumer plaintiffs in the Ciardi v. F. Hoffman-LaRoche case before the Supreme
Judicial Court. In February 2002, the SJC, consistent with the position argued by the Attorney
General's Office, held that indirect purchasers could sue for damages under M.G.L. c. 93A based
on antitrust claims. In Coleman Herman v. Home Depot , the Appellate Court, consistent with
the Attorney General's position, affirmed the consumer's authority to sue for violations of the
Attorney General's Item Pricing Regulations. CPAD also was involved in the Office signing on
to additional NAAG-sponsored multi-state amicus curiae briefs.

Training of Local Officials on Manufactured Housing Law CPAD held training sessions on
manufactured housing law for local officials in Wareham on June 27, 200 1 , in Marlborough on
September 26, 2001, and in Plymouth on September 28, 2001. The training sessions addressed
the annual manufactured housing licensing process, utilities such as water or sewerage systems, oil
tanks, and other health and safety concerns in manufactured housing communities. The sessions
also addressed the Manufactured Housing Act, the Attorney General's regulations, and the
comprehensive Attorney General's Guide to Manufactured Housing Community Law.

OUTREACH, EDUCATION, AND TRAINING

Consumer Complaint and Information Section (CCIS) CCIS mediated consumer complaints
filed against businesses that may have engaged in unfair or deceptive acts or practices. In Fiscal
Year 2002, the section received and responded to 103,075 telephone calls and mediated over
3,000 consumer complaints, recovering $661 ,925 for consumers in the Commonwealth. CCIS
also provided consumer information on all manner of issues by responding to telephone calls and
letters, by distributing brochures, and through public speaking engagements. CCIS also responded
to press inquiries concerning businesses complained against and updated its tracking system to
more quickly and accurately respond to Public Records Requests concerning consumer complaints.
Staff members spoke at a number of locally hosted consumer forums, addressing topics such as
the Used Vehicle Warranty Law and the Lemon Law for a recent class of graduates of a technical
school, hosted by the American Automobile Association, and telemarketing and financial fraud
scams facing elders at a monthly meeting of seniors in Rockland, and offered brochures and
complaint forms at several T-stops during National Consumer Week in February.

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CPAD Attorneys CPAD attorneys participated as speakers and panelists in consumer education
events, as well as in industry seminars and forums, on numerous issues, including identity fraud,
Internet safety, predatory lending, consumer credit and repair, healthcare antitrust, telemarketing
fraud, motor vehicle advertising and sales, state and federal "Do Not Call" legislation and
regulations, and other consumer protection issues.

ENVIRONMENTAL PROTECTION DIVISION

The Environmental Protection Division (EPD) serves as litigation counsel on environmental issues
for various state agencies, particularly those within the Executive Office of Environmental Affairs. EPD
handles the Commonwealth's civil litigation to enforce environmental protection programs established
by state statutes and regulations, including laws governing air pollution, water pollution, water supply,
waterways, wetlands, and 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 Office'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 2002, EPD handled enforcement proceedings leading to judgments requiring
payments to the Commonwealth of $1,626,510. This figure is for penalties, cost recovery, and other
payments awarded in Fiscal Year 2002, whether or not actually paid in Fiscal Year 2002. In Fiscal Year
2002, EPD received actual payments totaling $ 1 ,232, 196.65 in penalties, cost recovery, and other payments.
Other cases resulted in court judgments requiring private parties to undertake costly clean-ups — a
savings of millions of dollars for the Commonwealth.

The Investigations Division assisted EPD primarily through locating and identifying assets of potentially
responsible parties liable for paying costs incurred by the Commonwealth in the clean-up of polluted or
hazardous waste sites. Investigators also located former employees and officers of defunct companies
responsible in part for such violations, and reviewed, evaluated, and analyzed financial documents and
prepared ability to pay analyses.

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During Fiscal Year 2002, EPD staff included James Milkey, Division Chief; Frederick Augenstern;
Dena Barisano; Freda Boden; Edward Bohlen; Matthew Brock; Nora Chorover; Nicole Clark; Carolyn
Edwards; Benjamin Ericson; James Farrell; Dana Gershengorn; I. Andrew Goldberg; Nancy (Betsy)
Harper; Carol Iancu; Matthew Ireland; Eleanor Johnson; SiuTip Lam; Trevor Murray; William Pardee;
Christine Peluso; Dawn Stolfi Stalenhoef; and Danah Tench.

SIGNIFICANT CASE SUMMARIES

STATE AIR POLLUTION LAWS AND REGULATIONS

• Emission Standards During Fiscal Year 2002, EPD was again active in enforcing state laws
regarding pollution resulting from the operation of automobiles. Massachusetts is one of the
few states that have taken advantage of Section 1 77 of the federal Clean Air Act, a provision that
allows states to adopt California's stringent vehicle emissions standards. During Fiscal Year 2002,
EPD handled cases against three automobile dealerships to enforce these low emissions standards:
128 Sales, Baystate Motors, and RJ Foley, Inc. EPD settled the Baystate Motors case for injunctive
relief and a civil penalty of $39,000 ($3,000 per violation).

• Vapor Recovery Standards EPD was also active in defending and enforcing Massachusetts'
Stage II Vapor Recovery Standards. Stage II vapor recovery systems are used to control releases of
gasoline vapors when vehicles are refueled. They require gas stations to install and maintain
equipment to capture vapors that would otherwise escape to the atmosphere and contribute to
ozone and smog formation. In addition, a number of these substances (e.g., benzene, toluene)
are toxic. Department of Environmental Protection (DEP) revisions to the Stage II vapor recovery
regulations, effective in January 2001 , went into effect this past January. When three industry
associations challenged the regulations through a declaratory judgment action, EPD was called
upon to defend the regulations.

• Gitto Global EPD continued the prosecution of its case against Gitto Global Corp., a
plastics manufacturer's facility in Lunenburg. In this case, EPD alleges that the company violated
various state environmental laws, including through bypassing its air pollution control equipment.
Throughout Fiscal Year 2002, EPD pursued both discovery and settlement negotiations.

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• Power Plants In May 200 1 , DEP adopted new emissions standards for the six older power
plants in Massachusetts. EPD is defending a challenge to those regulations filed by the owner of
one of the affected power plants.

NATIONAL AND REGIONAL AIR POLLUTION ISSUES

• Ozone and Particulate Matter EPD continued to play a major role in national and regional
air pollution issues. The most important national air pollution issue litigated during Fiscal Year
2002 concerned the industry's challenge to the EPA's revised standards for ozone and particulate
matter, promulgated in 1997. Massachusetts was one of two states (the other was New Jersey) to
intervene on behalf of EPA in litigation before the U.S. Supreme Court to defend these standards.
On February 27, 2001 , the United States Supreme Court rejected, by 9-0, the industry's argument
that EPA's authority to issue new standards exceeded the agency's power under the Constitution.
The Court also rejected the industry's argument that EPA must temper its protection of public
health by taking into consideration, at the standard-setting stage, the costs of implementing the
standards. Following the remand of the case, Massachusetts continued to defend the standards
before the United States Court of Appeals for the District of Columbia Circuit. Whereas the
proceeding before the U.S. Supreme Court concerned a constitutional challenge to the standards,
the issues before the D.C. Circuit concerned industry's argument that the standards are arbitrary
and capricious under the federal Administrative Procedure Act. During this fiscal year, the D.C.
Circuit issued its ruling upholding the new standards.

• Heavy-duty Engine and Vehicle Pollution One of the Clinton Administration's last major
environmental actions was to issue regulations to reduce heavy-duty engine and vehicle pollution.
The rule is designed to reduce emissions of nitrogen oxides (which help cause smog) and particulates
(small particles that lodge deep in the lungs) from diesel engines by 95%. Several industry
organizations challenged EPA's Heavy-Duty Engine and Vehicle Standards and Highway Diesel
Fuel Sulfur Control Requirements (65 Fed. Reg. 35429) in the D.C. Circuit, including the
Engine Manufacturers Association, the American Petroleum Institute, and the National
Petrochemical & Refiners Association. Because of the significance of diesel emissions in degrading
the air quality of many Massachusetts neighborhoods, EPD intervened in support of EPA's rule
in the U.S. Court of Appeals for the D.C. Circuit. The Court issued a ruling upholding the
regulations.

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• American Power Co. v. U.S. EPA EPD was instrumental in obtaining a court ruling that
should reduce emissions from Midwestern and Southern power plants that contribute pollution
to the State air shed. In American Power Co. v. U.S. EPA (Section 1 26 litigation) , Massachusetts
intervened in federal court to defend EPA's decision to grant a petition, under Section 126 of the
federal Clean Air Act, to require EPA to impose emissions reductions upon power plants located
in Midwestern states. In a May 15, 2001 ruling, the D.C. Circuit largely upheld EPA's rule
requiring emissions reductions by Midwestern and Southeastern power plants but ruled in favor
of certain plant-specific claims, and also directed EPA to explain an element of its decision on
remedy. EPA issued a draft ruling on remand, and, following our comments, finalized that
ruling. An industry challenge to that ruling is pending.

• State of Michigan v. U.S. EPA In State of Michigan v. U.S. EPA (the "NOx SIP Call"
litigation), a case related to the Section 126 litigation, Massachusetts intervened to defend EPA's
decision to require 22 states to amend their air state implementation plans (SIPs) to include
mandatory reductions in NOx from in-state power plants. In early March, the Supreme Court
let stand the decision of the U.S. Court of Appeals for the District of Columbia Circuit upholding
EPA's "NOx SIP Call Rule." That rule, which EPA adopted in 1 998, required 22 Eastern States
and the District of Columbia to reduce emissions of nitrogen oxides (NOx) within their borders,
so as to reduce the movement (transport) of NOx to downwind areas, primarily in the Northeastern
States. The case continues, however, because the administrative ruling that EPA made on remand
with respect to the Section 126 litigation covers the issues on remand in the SIP Call case as well.
As mentioned above, that ruling is under appeal.

• New Source Review Also on the national stage, EPD continued to play a significant role in
a multi-state and EPA enforcement action against a large Ohio-based power company for upgrading
plants without installing Best Available Control Technology as required by the New Source
Review (NSR) provisions of the federal Clean Air Act. During Fiscal Year 2002, discovery in
American Electric Power continued. In the meantime, Attorney General Reilly urged the Bush
Administration not to substantially weaken its NSR policies, as it proposed to do through a
National Energy Policy proposal issued in May 200 1 . For example, the Attorney General testified
at an EPA hearing held on July 1 7, 2001 , and he sent several letters calling upon Vice President
Cheney, Attorney General Ashcroft, and EPA Administrator Whitman to stay the course.

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ENERGY

During Fiscal Year 2002, the Attorney General submitted comments to the federal Department of
Energy urging it not to roll back energy efficiency standards that DOE had set for central air conditioners
and heat pumps. After DOE went forward with its plans to roll back the standards, we joined a multi-
state challenge to the new regulations before the Court of Appeals for the D.C. Circuit.

2 IE ENFORCEMENT / HAZARDOUS AND SOLID WASTE DISPOSAL SITE CLEAN-UP

Under G.L. c. 2 IE, the Attorney General is charged with the responsibility of recovering
Commonwealth funds spent cleaning up hazardous waste sites. Where possible, EPD enters into
settlements with the parties responsible for the contamination to obtain their agreement to clean up the
site, rather than pursuing a cost-recovery action after the state has stepped in to itself clean up the
contamination. This saves the Commonwealth money up front and results in the efficient administration
of site clean-ups.

• Wellesley College In Fiscal Year 2002, EPD finalized its settlement of a major 2 IE cost-
recovery matter involving Wellesley College. This matter, which was ultimately resolved through
mediation, concerned extensive contamination of the upland portion of the Wellesley College
campus, including portions of the shoreline of Lake Waban, a Great Pond, by the operation of a
now-defunct paint shop. Under the terms of the settlement, Wellesley College agreed to pay the
costs of removing the contamination from the upland portion of the site (estimated at
approximately $28-$30 million) and the Commonwealth agreed to contribute $1.4 million to
the clean-up of the shoreline area.

• Norwood Commerce Center In Fiscal Year 2002, EPD also finalized a settlement involving
an industrial office complex known as the Norwood Commerce Center. The owners of the
property agreed to clean up the site (at an estimated cost of $ 1 million) , pay the Commonwealth
$360,000 in penalties, and contribute $175,000 into an escrow account to be used for future
clean-up actions if later deemed necessary.

• D.B. Enterprises FPD filed suit and obtained an attachment against D.B. Enterprises,
owners and operators of a large landfill in the Town of Wendell. EPD is seeking to recover
millions of dollars that the Department of Environmental Protection spent to stabilize the landfill
in order to prevent its catastrophic collapse.

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• Mutual Oil In a case involving a release of gasoline from a gas station in Brockton, EPD
alleged that Mutual Oil, the owner of the station, failed to notify the Department of
Environmental Protection of the release of gas from a leaking gas tank and failed to use appropriate
air-testing methods to detect the level of contaminants in an abutting home. EPD reached a
settlement that required payment of a $50,000 penalty.

• Starmet During Fiscal Year 2002, EPD filed suit against Starmet Corp. (formerly known as
Nuclear Metals) , a company that manufactured armor-piercing bullets and other munitions from
spent radioactive fuels at a site in Concord. EPA has placed the site on the National Priority List.
While the site itself is contaminated, there are also some 3,800 barrels of radioactive materials
that have essentially been abandoned at the site. EPD's state court suit was filed to require the
company to establish an escrow account for site decommissioning, to maintain security at the
facility, and to remove the barrels. The company agreed to establish the escrow account, and the
Court ordered it to continue to maintain site security while the case proceeds. EPD successfully
petitioned the Court to appoint a receiver to take over the site, although that order was dissolved
after the company filed for bankruptcy in South Carolina. EPD has been participating in the
South Carolina bankruptcy proceedings through a Special Assistant Attorney General.

• Lo gan Airport EPD reached a settlement in three related enforcement cases involving a fuel
spill at Logan Airport (American Airlines . MassPort , and Si gnature) . The cases were significant
in part because they were EPD's first enforcement actions based upon an alleged failure to report
a threat of a release. The settlement required the defendants to pay $530,000 in penalties and
other payments.

• MBTA EPD filed suit against the MBTA regarding significant lead and arsenic contamination
at the Readville Yard. In its complaint, EPD alleged that the T failed to clean up the site despite
its statutory liability and that children were gaining access to the contaminated areas at the site.
Through this case, EPD is seeking not only relief to address the specific violations, but also
broad-scale relief to force appropriate institutional changes regarding how the T manages its
environmental compliance issues. At EPD's urging, the Superior Court issued a preliminary
injunction requiring the T to secure the site and to take the next steps toward remedying the
contamination there.

• Hyde Park Landfill In Fiscal Year 2002, EPD reopened an old solid waste case involving a
landfill in Hyde Park by bringing a contempt action. EPD obtained a settlement of the contempt
action that included further injunctive relief and an additional penalty of $50,000.

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• IEMS of New England In November 2002, EPD filed suit for 2 IE regulatory violations
against JEMS of New England, a company that was performing a site clean-up. EPD's complaint
alleged that JEMS failed to comply with DEP orders to provide clean water to a family whose
well water was contaminated. JEMS, a former petroleum supplier, delayed compliance with the
orders while it sought a waiver of liability. The case is an important test of the 2 IE privatized
clean-up program.

• Mendon Road EPD continues to pursue recovery of costs spent by the state many years ago
to clean up coal-related wastes containing a compound known as ferric ferrocyanide. The so-
called Mendon Road case was filed several years ago against Narragansett Electric for clean-up
costs spent by the state, which now total $ 1 million, with interest. EPA preliminarily determined
that ferric ferrocyanide is a hazardous substance under the Comprehensive Environmental Response,
Compensation and Liability Act, the federal hazardous waste clean-up law upon which
Massachusetts' Chapter 2 IE is based. EPD submitted comments supporting EPA's preliminary
ruling, which — if finalized — would allow Massachusetts to argue that it was entitled to the
$ 10 million currently sitting in escrow.

• 229 Main St. Limited Partnership EPD prevailed in an appeal before the First Circuit
Court of Appeals involving contaminated property owned by 229 Main St. Limited Partnership
in Natick. At issue was whether the Department of Environmental Protection could file a lien
on the property after the owner went into bankruptcy. The Court upheld DEP's right to do so.
A second appeal challenging DEP's lien is pending in the state Appeals Court.

• Boston lunk In another major 2 IE action, SAK Recycling (also known as the "Boston
Junk" case), EPD is seeking recovery, from Boston Edison and others, of monies being spent to
clean-up the site of the Boston Convention Center. In this case, EPD is working closely with the
Boston Municipal Convention Center Authority and the Boston Redevelopment Authority co-
plaintiffs in the case.

• Colonial Shopp e EPD filed suit against the Colonial Shoppe, a liquor store in Hudson that
EPD alleged was violating the statute known as the Bottle Bill by paying people only four cents
per can or bottle redeemed, instead of the five cents required by the statute.

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NATURAL RESOURCE RECOVERY, PROTECTION, AND PRESERVATION

• Environmental Review EPD handled many cases that arose under the Massachusetts
Environmental Policy Act (MEPA). In the most significant case, MassPort filed suit seeking to
modify a 1976 state court injunction, issued under MEPA, enjoining the authority from
constructing an additional runway at Logan Airport. In the suit, MassPort alleged that
modification of the injunction was warranted because the Secretary of Environmental Affairs had
certified the environmental impact report for the proposed new runway. EPD is defending the
Executive Office of Environmental Affairs in this suit.

• Protection of Endangered Species and Plants In WRT v. DFW , EPD is defending actions
of the Division of Fisheries and Wildlife (DFW) implementing Massachusetts Endangered Species
Act (MESA). The developer of a golf course in Sturbridge brought a declaratory judgment
action challenging DFW's statutory authority to require "conservation permits" for habitat
alteration under MESA, as well as its authority to certify vernal pools. In an important decision,
the Superior Court ruled in DFW's favor.

• Wetlands. Waterways. & Water Pollution EPD filed suit against the City of Quincy for
violations of the Wetlands Protection Act. In the complaint, EPD alleged that the city built a
stone revetment along the coast without complying with certain key conditions insisted upon by
DEP, required by the City Conservation Commission, and agreed to by the city.

EPD filed suit regarding wetlands and solid waste violations at the Costa Farm in Fairhaven.
EPD alleged that the owner of the farm and another person disposed of rotting clamshells at the
farm, including in a wetlands area. EPD also alleged that wetlands had been destroyed from
leachate from the clamshell pile and in other ways as well.

Together with the U.S. Environmental Protection Agency and the U.S. Department of Justice, EPD
entered into a settlement agreement with the Town of Winchendon to resolve alleged violations of
federal and state clean water laws and government-issued permits. Under the civil complaint and consent
decree filed in U.S. District Court in Boston, Winchendon paid civil penalties totaling $50,000 ($35,000
to the federal government and $ 1 5,000 to the Commonwealth) and is conducting a $ 1 5 million upgrade
of its sewage treatment system. The upgrade should allow the town to operate its sewage treatment
facility in compliance with applicable discharge standards and should prevent the alleged ongoing discharge
of raw sewage into the Millers River during rainstorms.

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SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

BROWNFIELDS

Chapter 206 of the Acts of 1998, "An Act Relative to Environmental Cleanup and Promoting the
Redevelopment of Contaminated Property," otherwise known as the Massachusetts Brownfields Act,
encourages the clean-up and redevelopment of Brownfields sites through both liability reforms and
financial assistance. One of the liability reforms authorizes the Attorney General to enter into Brownfields
Covenants that provide liability relief beyond what is otherwise available under Chapter 2 IE. The
Brownfields Covenant Program addresses site-specific liability concerns for complex clean-ups and
important redevelopment efforts.

Applications for Brownfields Covenants are assessed according to the benefits they create for local
communities and the Commonwealth by: 1) creating new, permanent jobs; 2) resulting in affordable
housing benefits; 3) preserving historic buildings; 4) creating or revitalizing open space; and/or 5) providing
some other public benefit to the community in which the site is located.

In Fiscal Year 2002, the Brownfields Unit of the Environmental Protection Division continued to
work on a number of clean-up and redevelopment projects throughout the Commonwealth. The
Brownfields Unit considered several applications for Brownfields Covenants; finalized three Brownfields
Covenants in Boston, Lowell, and Greenfield involving a variety of redevelopment projects, and maintained
its efforts on various long-term priority projects. The Brownfields Unit also continued to solicit new
projects with outreach and education efforts.

In Fiscal Year 2002, this Office also launched the Attorney General's Municipal Brownfields Grant
Program to assist municipalities with brownfields revitalization and awarded approximately $1.3 million
to 29 communities across the Commonwealth.

Brownfields Covenants Issued

Greenfield Tap and Die Plant. Greenfield In December 2001, EPD, in collaboration with
DEP, provided liability relief in the form of an Administrative Order on Consent between
responsible parties at the site, the Town of Greenfield, and the Commonwealth to accommodate
the complex needs of both public and private parties. The clean-up of the former Greenfield Tap

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and Die Plant site, long vacant and blighted, will allow the 14-acre property to be redeveloped
for commercial, light industrial, and/or housing. Liability relief offered by the Attorney General's
Office enabled the Administrative Order on Consent to play an important role in the settlement
of the complex issues that existed between TRW, Inc., Greenfield Industries, Inc., and the Town
of Greenfield. The Attorney General awarded $36,300 to the Town of Greenfield to assist this
project.

Manchester Street. Lowell In February 2002, EPD executed a Brownfields Covenant for the
construction of affordable housing on Manchester Street in Lowell. Michael Harkins and Headwall
Recovery, together with the current owner, Muldoon Bros., will clean-up and redevelop the
two-acre parcel, which was formerly used as an oil depot. The project involves clean-up and
subdivision into at least six lots and the construction of single- and two-family residences on each
lot. All the homes are expected to be marketed and sold for $ 1 75,000 or less, and several of the
lots will meet state and local standards for affordable housing.

Roxbury /Urban Edge. Roxbury In March 2002, EPD entered into a Brownfields Covenant
with the UED Corporation, a subsidiary of Urban Edge Housing Corporation. Urban Edge
intends to redevelop the Washington Street site by razing a 24,000-sq.-ft. building formerly used
as an auto body repair shop, removing two abandoned 500-gallon underground gasoline storage
tanks, and remediating contaminated soil associated with those tanks. Urban Edge intends to
redevelop the vacant site for commercial and affordable housing uses.

Applications Under Consideration

Champion City Recovery. LLC Project. Brockton In October 2001, Champion City Recovery,
LLC, submitted an application for a Brownfields Covenant. Champion City intends to clean up
and construct a construction and demolition debris transfer facility at the site of the former
Hercules site in Brockton. In early June 2002, DEP issued a permit to construct the facility.

Stoklosa Middle School Project. Lowell In March 2002, the City of Lowell and KeySpan
Energy Delivery New England jointly submitted an application for a Brownfields Covenant.
The City of Lowell intends to build a 600-student middle school on 6.5 acres of former industrial
property, a portion of which KeySpan Energy currently owns. The Attorney General awarded
$76,000 to the City of Lowell to assist this project.

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Grove Willow. LLC, at the former Raytheon Facility. Waltham and Watertown In September
2000, Grove Willow, LLC, submitted its final application for the redevelopment of the former
Raytheon facility. Grove Willow intends to redevelop Raytheon's former 78-acre manufacturing
plant into a state-of-the-art telecommunications park and create potentially 1 ,000 jobs. In Fiscal
Year 2002, EPD continued to consider this application.

Glover Estates. LLC, at the former Chad wick Lead Mills Site on the Salem/Marblehead
border In February 2001, Glover Estates, LLC, submitted a Brownfields Covenant application
involving the clean-up of a former lead mill site and the construction of 55 units of senior
assisted living, with a percentage devoted to low-to-moderate-income residents. The development
would create between 50 and 60 new jobs. The application is currently under review. EPD
conducted a Public Forum on the project in April 2001 and has since learned that the project has
significant community opposition. In Fiscal Year 2002, EPD continued to monitor progress of
this project.

Iron Horse Park Superfund Site. Blllerlca In December 2001, Iron Horse Park, LLC, Easton
Exchange Holding, Inc., and Easton Exchange Services, LLC, submitted an application for a
Brownfields Covenant for the redevelopment of a portion of the Iron Horse Park Superfund Site
known as "Penn Culvert." The proposed reuse for the property is for a storage, handling, and
distribution facility that will include one 81 ,200-square-foot warehouse building, a paved parking
lot, and a railroad spur to revitalize the site, generate new jobs, improve the property value, and
increase the tax base in Billerica.

Applications Anticipated

GenCorp./Lawrence Gateway Project. Lawrence One of the Brownfields Unit's long-term
priority efforts is the Gateway area of Lawrence. The redevelopment of the GenCorp site into
parking and the abutting Oxford Paper site into a park and an open-space recreation area will be
catalysts for revitalization of the Gateway area — inspiring new development and increased
occupancy and use in existing mill buildings as well as expansion of Lawrence General Hospital
services. This project would create hundreds of jobs and spur economic development of the
Gateway area and much of the mill area, creating significant public benefits to Greater Lawrence.

In Fiscal Year 2002, EPD continued to participate in regular Gateway meetings convened to
provide constant momentum to move the GenCorp and Oxford Paper projects forward. EPD
also promoted and facilitated the formation of an entity to assume operation and management

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responsibilities of a 2,000-space parking facility on the GenCorp site that could be used by
abutting mill owners by 2004. EPD also advocated for near-term parking spaces on appropriate
portions of the GenCorp site. GenCorp has submitted a draft application for consideration.

In addition, the Attorney General awarded a Brownfields Municipal Grant of $125,000 to the
City of Lawrence to assist with the Gateway project.

Rail Yard. New Bedford Another of the long-term priority brownfields efforts is the New
Bedford Redevelopment Authority project involving the conversion of the 30-acre New Bedford
rail yard into a multi-use inter-modal transit area. Throughout Fiscal Year 2002, EPD worked
with City of New Bedford officials to provide assistance so that the project's liability issues
would be addressed. The Attorney General awarded a Brownfields Municipal Grant of $89,900
to the City of New Bedford to assist this project.

BFI/Decor Project. Whitman A current tenant with an existing business forms company is
interested in completing the clean-up and expanding paper manufacturing operations, creating
approximately 30 new jobs, but has liability concerns associated with these efforts. In Fiscal Year
2002, EPD continued its efforts on this project.

Smith & LaMountain Service Corp. Project. Monson In June 2002, Smith & LaMountain
Service Corp. submitted a draft application for a Brownfields Covenant for a project in Monson.
The applicant intends to clean up and redevelop a 5-acre site with a 10,000-square-foot building
(former/abandoned auto repair /dealership) into company headquarters and create 35 new jobs.

Olin Chemical Site. Wilming ton In Fiscal Year 2002, EPD met with DEP, Olin, and a prospective
developer to discuss the liability issues relating to an appropriate clean-up and redevelopment of
the site.

Microfab Site. Amesbury EPD has worked with the City of Amesbury to assist the redevelopment
of an abandoned property that is the subject of a DEP lien. DEP, using a brownfields grant from
EPA, recently completed the Phase II Comprehensive Assessment of the properly, which provides
valuable information for potential developers. EPD has also met with developers interested in
applying for a Brownfields Covenant and made the Phase II Report available for review by
potential developers. The Attorney General awarded a Brownfields Municipal Grant of $40,000
to the City of Amesbury to assist this project.

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Other Projects

Throughout Fiscal Year 2002, EPD explored clean up and redevelopment opportunities with a variety
of prospective developers. These redevelopment projects could lead to the creation of new jobs across the
Commonwealth, involving significant tracts of land and commercial space, and the creation of affordable
housing and open space.

In many instances, EPD has encouraged clean up and redevelopment projects to proceed by explaining
to interested parties that the statutory relief should be sufficient liability protection and that a Brownfields
Covenant would not be necessary.

The Attorney General's Municipal Brownfields Grant Program

In Fiscal Year 2002, in order to encourage brownfields revitalization and liability protection for
municipalities participating in the Brownfields Covenant Program, the Office developed the Municipal
Brownfields Grant Program. The Grant program is designed to assist municipalities in returning
underutilized properties to more productive and desirable uses. EPD sent grant application packages to
each of the 35 1 municipalities in the Commonwealth. In addition, EPD also made the grant information
available on the Attorney General's Web site, which it updated specifically for this purpose. EPD offered
three types of appropriate uses for the grants:

1) Comprehensive Redevelopment Planning (for costs associated with redevelopment planning,
including pre-construction, reuse analysis, site planning, and architectural design components of
the overall redevelopment proposal, which will allow program participants to determine the
scope and feasibility of a Brownfields project);

2) Open Space Creation or Revitalization (for costs associated with on-site investigation as to the
nature and extent of environmental contamination on the property, as well as to provide assistance
with open space enhancement) ; and

3) Brownfields Covenant Application Assistance (for costs associated with transactional costs,
legal fees, mapping and/or Geographic Information System costs, and Licensed Site Professionals
and technical assistance expenses related to the Municipal Brownfields Grant Program process).

The deadline for submission of the grant applications was March 13, 2002. EPD received 31
applications, seeking over $2. 1 million. After a rigorous review process, the Attorney General awarded

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approximately $1.3 million in grant funds to 27 municipalities in April 2002, representing more than 30
Brownfields projects.

Amesbury $40,000 for redevelopment planning for the Lower Millyard area, including relocation
analysis of the Department of Public Works facilities at the Microfab site.

Ashfield $57,400 for open space revitalization of the Old School site.

Athol (through the Montachusett Regional Planning Commission) $19,000 for redevelopment
of the Island Street Lot.

Barnstable $57,400 for open space revitalization of an abandoned gas station site.

Easthampton $25,000 for comprehensive redevelopment plan for the Ferry Street Re-Use Project.

East Bridgewater $20,000 to conduct a reuse feasibility study for the Eastern States Steel/
Precise Engineering site and for Brownfields Covenant application assistance.

Everett (Mystic Valley Development Commission) $116,035 for the Telecom City project
for comprehensive redevelopment planning, housing planning, and open space revitalization.
The Mystic Valley Development Commission will use these funds for design drawings for the
Internet Drive and Norman Street forTeleCom City East, to undertake site planning cost analysis
for Project 525, and to revise the Response Outcome Statement on the Everett/GE Park site so
that it will allow recreational use. Finally, the Grant funds were also able to assist with the design
costs for the bike-to-the-sea path.

Gardner $69,733. 1 5 for the Library Open Space Enhancement Project, redevelopment planning
for Pond Brook Way, and Brownfields Covenant application assistance.

Greenfield $36,300 for redevelopment planning and open space revitalization of the Greenfield
Tap and Die Redevelopment Project located at Meridian Street.

Haverhill $62,000 for comprehensive redevelopment planning and Brownfields Covenant
application assistance for the 57 Granite Street Project.

Lawrence $125,000 for open space enhancement of the Oxford Mill Site and the Lawrence
Gateway area.

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Lowell $76,000 for comprehensive redevelopment planning, including open space enhancement,
for the Kathryn P. Stoklosa Middle School project.

Lowell $2 1 ,250 for comprehensive redevelopment planning associated with the Tanner Street
Initiative.

Lynn (EDIC/Lynn) $24,500 for analysis of reuse options for the Lynn GE site and for
Brownfields Covenant application assistance.

Marlboroug h $85,000 for two projects: Open Space Design for the Old Train Depot site and
comprehensive redevelopment planning at the former Tannery site.

Maynard $23,875 for open space enhancement related to the Bursaw Parcel project.

Montag ue $13,640 for redevelopment planning for the former Sweeny Ford site.

New Bedford (New Bedford Redevelopment Authority) $89,900 for development of a
comprehensive redevelopment plan and for Brownfields Covenant application assistance for New
Bedford's North Terminal Regional Inter-modal Transportation Center project.

North Brookfleld $5,000 for Brownfields Covenant application assistance relating to the former
Aztec site.

Northampton $50,000 for open space revitalization of the Historic Mill River Corridor.

Pittsfleld $55,000 for comprehensive redevelopment planning for the former GE Pittsfield site
and Brownfields Covenant application assistance.

Plymouth {Plymouth Redevelopment Authority) $ 1 2,925 for redevelopment planning for the
Revere Copper project.

Somerville $30,000 for redevelopment planning for the Kiley Property project.

Taunton $25,000 for structural analysis of the F.B. Rogers Building.

Templeton (through the Montachusett Regional Planning Commission) $18,000 for open
space revitalization of the former Templeton - Hubbardston Railroad spur.

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PUBLIC PROTECTION BUREAU ENVIRONMENTAL PROTECTION DIVISION

Templeton (through the Montachusett Regional Planning Commission) $18,000 for open
space creation of the Nugget parcel.

Walpole $42,500 for a reuse analysis of 1901 Main Street.

Waltham 533,000 for open space planning at the former Bemis Railroad Spur site.

Worcester $67, 500 for redevelopment planning for the Mason/Winfield Rehabilitation Project.

Other Program Developments

In Fiscal Year 2002, the Brownfields Unit hired a Brownfields Coordinator and an Assistant Attorney
General to assist in the operation of the program. The expansion allowed a greater level of outreach
efforts to provide education and background on the Brownfields program generally. The Brownfields
Unit also upgraded the technology capabilities with geographic information systems (GIS) so that it can
develop extensive maps of Brownfields, digital imaging, and other upgrades, such as laptop, printer, and
PowerPoint presentation materials, to assist in our outreach efforts.

LEAD PAINT

Massachusetts has a high rate of lead poisoning among children due, at least in part, to exposure to
lead-based paint in the state's older housing stock. Luckily, Massachusetts also has one of the nation's
strongest lead-based paint notification and abatement laws. The Massachusetts lead law requires the
deleading or interim control of lead hazards existing in homes built before 1978 where children under 6
are living. Owners are also required to notify tenants that a property has not been deleaded, regardless of
whether a child under the age of 6 is living in the home.

During Fiscal Year 2002, Massachusetts continued a lead paint enforcement initiative in cooperation
with the EPA and the U.S. Department of Housing and Urban Development (HUD). The initiative
seeks to enforce the state law requiring disclosure of lead hazards and the abatement of lead paint with
enforcement of the federal disclosure requirements. EPD's actions are part of a larger Public Protection
Bureau initiative that will potentially include civil rights actions against landlords who seek to evade the
lead law by refusing to rent to families with small children and enforcement actions against unlicensed
lead abatement contractors.

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PUBLIC PROTECTION BUREAU ENVIRONMENTAL PROTECTION DIVISION

ENVIRONMENTAL HEALTH AND SAFETY IN THE SCHOOLS

Consistent with Attorney General Reilly's priority on safe schools, EPD participated in numerous
initiatives to address environmental health and safety concerns in Massachusetts' public schools, especially
indoor air quality. The Attorney General has been a consistent advocate of schools, adopting Environmental
Management Systems to address their environmental compliance issues on an ongoing basis.

During Fiscal Year 2002, EPD continued to work with community groups and other state agencies
to identify the common environmental health and safety issues in the schools, the challenges the schools
face in addressing those issues, and the gaps in the laws and regulations on such issues. EPD is currently
working with several members of the Healthy School Council to develop legislation to address
environmental health and safety issues in the schools.

PROTECTING CONSUMERS FROM EXPOSURE TO ASBESTOS,
TOXICS, AND PESTICIDES

Massachusetts has a long-standing commitment to reducing human exposure to harmful substances,
such as asbestos, toxics, and pesticides.

In Fiscal Year 2002, EPD continued its enforcement initiative against asbestos abatement contractors
and owners/operators of facilities where improper removal of asbestos has resulted in the release of asbestos
into the environment. In addition to several enforcement cases under investigation, EPD reached a
settlement against General Air Conditioning & Heating, a small company based in Boston, regarding
alleged violations of asbestos-related regulations at a state facility. The settlement required injunctive
relief and payment of a $30,000 penalty.

THE CLEAN STATE INITIATIVE

A top priority of the Attorney General is compliance, by all state agencies and authorities, with the
environmental laws and regulations of the Commonwealth. In addition to prosecuting individual cases
against state entities, the Attorney General during Fiscal Year 2002 issued a comprehensive report to the
Governor and the General Court reviewing the Clean State Initiative begun in 1994 with the issuance of
Executive Order 350. The report concluded that the initiative has done a good job of seeing that a huge
number of existing violations have eventually been identified and addressed, but has done a relatively

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PUBLIC PROTECTION BUREAU INSURANCE DIVISION

poor job of preventing new violations, as shown by a number of recent high-profile violations. The
2002 report called upon the Swift Administration to revitalize the Clean State Initiative by continuing
the reporting obligations included within Executive Order 350, and it called upon the Governor to
require all state agencies to institutionalize environmental compliance into their mission by adopting
environmental management systems.

LEGISLATIVE EFFORTS

Much of EPD's legislative work this year was in fighting efforts by the U.S. Department of Defense
(DOD) to secure additional exemptions from federal environmental laws. In several letters that he sent
opposing such efforts, the Attorney General pointed out that historically DOD has been one of the worst
environmental violators and that the major federal environmental laws already provide DOD with sufficient
flexibility to ensure that environmental compliance will not compromise military readiness.

AMICUS BRIEFS

During Fiscal Year 2002, EPD submitted several amicus curiae briefs. The most significant amicus
brief was submitted in Taygeta v. Varian . a case that was pending before the SJC. At issue was how the
applicable statute of limitations should be applied to a property damage claim brought pursuant to G.L.
c. 2 IE. The Superior Court had dismissed as untimely a claim brought by one owner of contaminated
property against the owner of adjacent property that was the source of the contamination. The owner of
the source property argued that once someone fears that his property is contaminated, he has a duty to
investigate whether his property is in fact contaminated and must file any claims within three years. EPD
argued that the innocent party had no independent duty to conduct the site investigation in order to
preserve his property damage claim against the party who caused the contamination. The Court issued a
ruling reversing the Superior Court's dismissal of the case, adopting the legal position set forth in EPD's
brief. This is a significant victory for the victims of hazardous material contamination.

INSURANCE DIVISION

The Insurance Division represents the public interest in administrative insurance rate-setting proceedings.
The Commissioner of Insurance sets these rates, and the administrative proceedings are held at the
Commissioner's Division of Insurance. The Insurance Division also brings actions in state court against
insurers for unfair acts and practices, provides comments and testimony regarding proposed regulations

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PUBLIC PROTECTION BUREAU INSURANCE DIVISION

and laws relating to insurance, mediates claims on behalf of consumers, and provides assistance on insurance
and other issues to members of the Massachusetts elder community.

Staff members of the Insurance Division included Joanna Connolly, Division Chief; Stacy Book;
Matthew Buehler; Joyce Coughlin; Gerald D'Avolio; Judith dePontbriand; Barbara Fain; Maureen Forbes;
Lydia Froese; Stacey Gotham; Maureen Hensley-Quinn; Hilary Hershman; Peter Leight; Pamela Meister;
Susan Melucci; Thomas O'Brien; Mary Jane Preskenis; Katie Rhodes; and Rachel Weiner.

SIGNIFICANT CASE SUMMARIES

RATE CASES

• Automobile Insurance Rate Setting for the Year 2002 Cycle (Insurance Division) The
Automobile Insurance Rate Setting proceeding is an annual administrative proceeding in which
the Commissioner of Insurance, based on proposals and evidence submitted by the auto industry
and other parties, sets automobile insurance rates for the coming year. The division represents the
public interest in these proceedings and usually submits our own proposed rate filing. The case,
if pursued to its conclusion, requires litigation in four separate dockets, each dealing with another
portion of the overall rate computation. In Fiscal Year 2002, the industry sought a 7.8% increase
in rates. Before the division was required to make any filings in the main portion of the case, the
administrative docket settled. Rates were set by stipulation at the same level as the year before
(0% increase). Compared to the rate requested initially by the industry, this settlement saved
consumers over $200 million.

• Residual Market Homeowners Insurance. Year 2002 Cycle (Insurance Division) Many
homeowners in Massachusetts are unable to obtain homeowners insurance from private insurance
carriers in the voluntary market, especially those homeowners whose dwellings are close to the
shoreline and/or are located in urban areas. Under Massachusetts law, these homeowners can
obtain insurance from a "residual" market, where major insurers are required to pool the risk and
provide coverage. The Commissioner of Insurance sets rates for this residual coverage annually,
after an administrative proceeding. In Fiscal Year 2002, the industry proposed a rate that the
division accepted without further negotiation. The case thus settled by stipulation without
administrative litigation.

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PUBLIC PROTECTION BUREAU INSURANCE DIVISION

• Medicare Supplement Rate Proceeding s (Insurance Division) Each insurance company
offering Medicare Supplement insurance must file its policy with the Commissioner of Insurance
and get approval if it is seeking significant premium rate increases. In Fiscal Year 2002, the
division opposed the increases sought by three insurers: World Insurance, Hartford Life Insurance,
and Oxford Life Insurance. All three cases settled by stipulation without significant administrative
litigation. Through the efforts of the division, the rate increases were significantly curtailed and
consumers saved over $1.7 million.

AUTO INSURANCE

• In re: Ins Web Co. (Suffolk Superior Court) Ins Web, an online Internet service that provides
auto insurance quotes to Massachusetts drivers, allegedly used filters on its Web site to screen out
requests by bad drivers, in violation of Massachusetts law, which requires insurers to offer insurance
to all drivers. Prior to any litigation, Ins Web agreed to an Assurance of Discontinuance and paid
$7,500 to the state. In addition, Arnica Insurance and Commerce Insurance, two Massachusetts
insurers who gave quotes to consumers via Ins Web, also agreed to refrain from illegal filtering in
the future and paid $7,500 each to the state.

HEALTH CARE

• Aetna/US Healthcare (Suffolk Superior Court) Aetna/US Healthcare, a national health
insurer doing business in the Commonwealth, allegedly failed to provide proper notice to consumers
that their policies were being canceled. Prior to litigation, Aetna agreed to an Assurance of
Discontinuance and to pay $25,000 to the Local Consumer Aid Fund.

• Polaroid (Bankruptcy Court, District of Delaware) Polaroid, a Massachusetts corporation
with offices in Woburn, filed for bankruptcy protection in October 2001 in Delaware. Due to
the bankruptcy, employee benefits for retirees would no longer be available. The division
intervened in the bankruptcy on behalf of employees and retirees. Through subsequent filings
and appearances, the division secured continued Medigap coverage for the retired employees.

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PUBLIC PROTECTION BUREAU INSURANCE DIVISION

• Boston Regional Medical Center (Bankruptcy Court, District of Massachusetts) Boston
Regional Medical Center (BRMC) is a hospital that filed for bankruptcy in 1999. BRMC
diverted employee health insurance premium payments for other purposes, leaving its employees
without healthcare coverage. The division intervened under Bankruptcy Rule 2018B and filed a
proof of claim on behalf of affected employees. This case was litigated up to the eve of trial and
then settled for $83,000 in payments to consumers (this represents 60% of the medical bills
incurred during the 60-day period after termination and 100% of the costs incurred by the
employees who retained some other insurance coverage) .

• Commonwealth v. Healthcare Value Management (Suffolk Superior Court) This case
involved a fraudulent Ameri-Med health plan. Healthcare Value Management (HCVM)
negligently assisted a fraudulent health plan scheme by agreeing to provide its provider network
to the chimeric health plan (Ameri-Med) without performing any background checks. HCVM
agreed in a Consent Judgment to perform such background checks in the future and made payments
to consumers totaling $98,000.

LIFE INSURANCE

• Allied Waste/BFI Allied Waste (formerly known as BFI) , a national trash disposal company
with offices in Massachusetts, allegedly negligently filed an erroneous list of insured employees
with its life insurance company, resulting in unlisted employees losing insurance coverage. Prior
to filing a suit, Allied agreed to provide the full death benefit of $25,000 to the widow of the one
employee who died during the period of non-coverage.

• Boston Mutual Life Ins. Co. Boston Mutual Life Insurance Company, a life insurer in the
Commonwealth, allegedly used unlawful sales practices (also known as "churning") and misled
consumers regarding the projected return on their life insurance investments. Boston Mutual
voluntarily provided restitution totaling $14,000 to the two harmed consumers and provided
them with replacement life insurance policies. There was no litigation, and no settlement or
assurance was filed in court.

• Mass Mutual Life Ins. Co. Mass Mutual Life Insurance Company, a life insurer in the
Commonwealth, allegedly churned policies and misled consumers regarding the projected return
on their life insurance investments. Mass Mutual voluntarily provided the one consumer who
was harmed with a replacement life insurance policy that conformed to the company's
representations. There was no litigation, and no settlement or assurance was filed in court.

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PUBLIC PROTECTION BUREAU INSURANCE DIVISION

• Sun Life Sun Life Insurance Company, a life insurer in the Commonwealth, allegedly churned
policies and misled consumers regarding the projected return on their life insurance investments.
The division raised the issue with Sun Life, and the company voluntarily corrected the accounts
of the seven consumers involved. The adjustments were worth $73,000 to the consumers.
There was no litigation, and no settlement or assurance was filed in court.

OTHER OFFICE LITIGATION

• Messing, et al. v. Harvard Colleg e (Supreme Judicial Court) This was an appeal in a
private lawsuit from a Superior Court decision sanctioning a law firm for interviewing current
employees of the defendant without notifying defendant's counsel. Defendant argued that this
conduct violated Rule 4.2 of the Massachusetts Rules of Professional Conduct. The decision
and the sanction, which was in excess of $94,000, had attracted considerable attention in the
Massachusetts legal community. Through the combined efforts of the Charities Division, the
Criminal Bureau, and the Insurance Division, the office filed an amicus brief. On appeal, the
Supreme Judicial Court vacated the Superior Court sanctions order and held that the plaintiff
law firm had not violated the disciplinary rules. The Supreme Judicial Court also proposed a
new test for evaluating the propriety of ex parte contacts with employees of a represented
organization. Later in the year, the Supreme Judicial Court revised the Comments to Rule 4.2 to
follow the new standard set forth in its opinion.

PARTICIPATION IN REGULATORY HEARINGS

• Department of Public Health Regulations (Department of Public Health) The Department
of Public Health proposed revisions to its Health Insurance Consumer Protection regulations,
105 Code of Massachusetts Regulations (CMR) 1 28.00. These regulations include requirements
for insurance carriers in administering their internal grievance procedures, requirements for the
conduct of external reviews of carriers' adverse determinations, and requirements for continuity
of care and referral to specialty care. The Attorney General's Insurance Division testified at the
public hearing and provided generally supportive testimony regarding the changes, but also noted
that some additional changes and clarifications would be desirable.

• Insurance Division Regulations (Insurance Division) The Insurance Division sought to
amend a variety of regulatory provisions during Fiscal Year 2002, including regulations on Managed

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PUBLIC PROTECTION BUREAU INSURANCE DIVISION

Care Consumer Protection Provisions, Accreditation of Carriers, HMO Plan Design issues, and
limits on Specified Disease Coverage. The Attorney General's Insurance Division provided
testimony on these proposed amendments, including suggestions for technical corrections, to the
Commissioner of Insurance.

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

INSURANCE HOTLINE AND MEDIATION PROGRAM

In Fiscal Year 2002, 7,404 people, an average of 6 1 7 a month, called the division to ask questions and
seek help with insurance problems. More than 40% of the callers were concerned about health insurance
issues. Many of the callers had been recently laid off from their jobs and needed information about their
health insurance rights; others were concerned about the cost of prescriptions, claim denials, and medical
bills. Approximately 20% of the callers sought help with auto insurance problems. Most were having
difficulty with accident claims, while others raised questions about premium billing, cancellations, and
surcharges.

The Insurance Division received a large volume of calls in October 2002, when Polaroid Corporation
filed for protection under Chapter 1 1 of the Bankruptcy Code. More than 1,000 people called the
division in October, the majority of whom were Polaroid retirees and employees concerned about their
health, life, and disability insurance benefits. Mediation staff provided information and reassurance to
callers and assisted in the preparation of advisories for Polaroid employees and retirees and their families.

In addition to the consistently high volume of calls related to health and auto insurance, the Insurance
Division also received inquiries related to a broad range of other issues, including short- and long-term
disability insurance, life insurance and annuities, travel insurance, credit insurance, and possible insurance
scams. Callers asked questions about how to evaluate insurance before purchasing a policy, how to cancel
unwanted insurance, how to appeal a denied claim, and how to deal with incorrect billing.

The Insurance Division's mediators answered the questions of callers, providing information and
referrals and, when appropriate, mailing consumer complaint forms.

In Fiscal Year 2002, the Insurance Division opened 1 ,293 consumer complaint files, the majority of
which were submitted on consumer complaint forms or as letters to the division. As with the telephone

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PUBLIC PROTECTION BUREAU INSURANCE DIVISION

inquiries, a significant number of the written complaints related to health insurance — 497 of the new
complaints, 38% of the total, involved health insurance. The most prevalent complaints concerned
claim denials.

In Fiscal Year 2002, 21 undergraduate interns from 14 colleges and universities received training to
mediate consumer insurance complaints. More than half of the interns received academic credit for their
work. During the summer and academic year, interns volunteered nearly 4,000 hours in the mediation
program.

In Fiscal Year 2002, Insurance Division mediators closed 1 ,343 consumer complaint files and recovered
$1,726,271.90 for Massachusetts consumers.

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PUBLIC PROTECTION BUREAU

INSURANCE DIVISION

INSURANCE DIVISION MEDIATION PROGRAM OUTCOMES

FUNDS

CALLS TO

NEW

TOP

FILES

RECOVERED

HOTLINE

COMPLAINT

ISSUES

CLOSED

FOR CONSUMERS

July 2001

550

126

Health: 49
Auto: 27

117

$98,571.23

August

639

105

Health: 44

$124,965.84

2001

Auto: 18

September

418

Health: 27

$205,105.28

2001

Auto: 23

October

1,025

149

Health: 63

105

$109,469.59

2001

Auto: 29

November

608

102

Health: 41

130

$128,323.35

2001

Auto: 14

December

504

Health: 28

145

$208,235.40

2001

Auto: 1 1

January

723

137

Health: 51

$122,813.85

2002

Auto: 36

February

667

123

Health: 47

158

$115,431.24

2002

Auto: 20

March

630

111

Health: 38

101

$215,223.65

2002

Auto: 28

April 2002

505

106

Health: 44
Auto: 16

119

$175,829.58

May 2002

627

106

Health: 49
Auto: 19

$106,493.92

June 2002

508

Health: 36
Auto: 10

142

$115,829.22

TOTAL

7404

1293

1343

$1,726,291.90

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PUBLIC PROTECTION BUREAU INSURANCE DIVISION

AG ELDER

The Attorney General's Elder Hotline was established six years ago, in June 1997. Since its inception,
the hotline has grown steadily in the number of calls that it handles, the scope of services it provides, and
the number of volunteers who staff the line and mediate complaints. In the past fiscal year, while the
number of calls received remained essentially constant (7,583), the complaints/queries opened grew by
14.6% from 2,594 to 2,974, and the money returned to consumers through mediation nearly doubled
from $88,421.68 to $169,768.22.

The top three categories of complaints remained constant between Fiscal Years 200 1 and 2 002 . The
number one complaint was against businesses, including auto dealerships, retail stores, and banks (521
complaints) . The number two category comprised complaints related to telemarketing, sweepstakes,
lotteries, and mail solicitations and fraud (3 1 3 complaints) . The third area of complaint related to health
insurance issues, including prescription drug coverage (3 1 complaints) .

Problems regarding credit card and other types of debt moved from the sixth most common category
of complaint during the last fiscal year to the fourth most common this year, with 194 complaints
registered. Following that were complaints regarding utilities, chiefly telephone services, with 186
complaints logged in. There were 1 70 complaints of financial exploitation, 1 63 complaints against home
improvement contractors, 132 complaints against healthcare businesses or healthcare workers, and 98
housing-related complaints, primarily involving senior housing complexes and, secondarily, assisted-living
facilities.

COMMUNITY BENEFITS GUIDELINES FOR HOSPITALS AND HMOS

Community Benefits include programs, grants, and other initiatives developed by hospitals and
HMOs as part of a formal plan to address health and social needs in their communities consistent with
the principles of The Attorney Generals Community Benefits Guidelines for Nonprofit Acute-Care Hospitals
and The Attorney General's Community Benefits Guidelines for Health Maintenance Organizations.

The Community Benefits Guidelines represent a unique non-regulatory approach under which
Massachusetts hospitals and HMOs have voluntarily committed themselves to continuing and building
upon their efforts to identify and respond to the unmet needs of the communities they serve. The
guidelines call upon hospitals and HMOs to formalize their approaches to Community Benefits planning,

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PUBLIC PROTECTION BUREAU INSURANCE DIVISION

to collaborate with community representatives to assess community needs and create programs to address
those needs, and to publish annual reports on their progress.

Members of the Consumer Protection and Antitrust Division and the Public Charities Division
oversee reporting under the hospital guidelines. A member of the Insurance Division oversees both reporting
under the HMO Guidelines and the Attorney General's Community Benefits Advisory Task Force,
convened for the purpose of advancing the goals of the guidelines.

The Advisory Task Force includes representatives of hospitals, HMOs, community health advocacy
groups, and relevant state agencies. It is organized into several working groups that focus on the key
elements of Community Benefits, including reporting and community engagement.

During Fiscal Year 2002, Community Benefits staff worked to update and revise the original
Community Benefits Guidelines, drafting changes and meeting with the Massachusetts Hospital
Association, the Massachusetts Association of Health Plans, and consumer health advocates to discuss the
proposed revisions. The full Advisory Task Force reviewed the changes, and revised guidelines were
issued in the second half of Fiscal Year 2002.

Community Benefits staff also finalized and implemented a new process and format for Community
Benefits annual reports. This included completing an informal public comment process, conducting
several training sessions for hospital and HMO Community Benefits managers, and providing guidance
to hospitals and HMOs in their preparation of their Fiscal Year 2001 annual Community Benefits
reports.

The Office sought and received approval from the Kellogg Foundation to re-allocate the balance of
an expired grant to the Public Charities Division toward the design and development of a Community
Benefits Web-enabled database and electronic filing system for annual reports. This project involved
selecting and contracting with a Web applications contractor and working closely with that contractor to
develop the applications. The Advisory Task Force working group on reporting issues served as a "user
group" throughout the design and testing of the database and electronic filing system. The first phase of
the Community Benefits Web site was launched toward the end of Fiscal Year 2002, and the remaining
work is scheduled for completion in the first half of Fiscal Year 2003.

Finally, another Advisory Task Force working group designed and planned a series of regional
Community Benefits public forums around Massachusetts. These forums are scheduled to take place
during Fiscal Year 2003.

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PUBLIC PROTECTION BUREAU INSURANCE DIVISION

OUTREACH, EDUCATION, AND TRAINING

EMPLOYEE TRAINING

The Insurance Division staff coordinated two officewide trainings for non-lawyers on how to avoid
the unauthorized practice of law and how best to handle stressful consumer telephone calls.

The Elder Hotline offers mandatory monthly trainings to its volunteers and staff on various topics.
In Fiscal Year 2002, these included: Chapter 93A; Hospice Care; Public Records Request; Helping
Consumers Facing Financial Crisis; Handling Common Complaints; Avoiding the Unauthorized Practice
of Law; ABCs of Call Taking; Telemarketing and Lottery Scams; Home Improvement Contracting;
Overview of the Criminal Bureau; Overview of the Medicaid Fraud Control Unit; Overview of the Civil
Rights Division and the Disability Rights Project.

ELDER ISSUES

The division coordinated three conferences on elder fraud abuse. The conferences, held in Dorchester,
Salem, and Springfield, were collaborative efforts involving the Attorney General's Public Protection,
Criminal, and Fair Labor Bureaus and the Attorney General's Western Massachusetts Office; district
attorneys offices; state protective services offices; and local police departments. Conference panelists
discussed telemarketing, identity and home improvement fraud, local scams, and how to recognize and
report abuse in nursing homes and in the community. More than 450 elders, elder providers, and law
enforcement professionals attended these free, half-day events.

The division trained municipal police cadets on elder fraud and abuse.

The division conducted extensive outreach to elders and elder providers during Fiscal Year 2002 on
unfair debt collection, telemarketing, home improvement fraud, charity fraud, and identity theft.

The division also assigned representatives to serve on various elder advisory boards.

AG Elder staff provided information about the office and about consumer fraud and protection at
13 different events around the Commonwealth. These were mostly speaking engagements at different
sites where seniors live or gather, including senior centers, senior housing complexes, and community
groups. In addition, AG Elder gave presentations at two hospitals and two legal clinics.

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PUBLIC PROTECTION BUREAU INVESTIGATIONS DIVISION

In November 2001 , the division delivered a seminar to the Department of Labor's Pension Welfare
Administration staff on the topic of the interplay between state law and federal law in cases that pertain
to employee benefits. The seminar addressed the scope of state insurance law and how the Attorney
General is able to aid employees in maintaining or securing employee benefits in circumstances where
there are violations either by employers, insurance companies, or third-party administrators.

STATISTICAL SUMMARY

Investigations initiated 1 1

Litigation initiated in Superior Court 1

Judgments obtained in Superior Court 1

Bankruptcy interventions 2

Assurances of Discontinuance 2
Money saved for consumers in administrative rate proceedings $202 million

Restitution obtained for consumers in civil cases $293,000

Payments to the Commonwealth $47,500

Money recovered in Insurance Mediation Program $ 1 ,726,292

Money recovered by AG Elder Mediation $169,769

INVESTIGATIONS DIVISION

The Investigations Division conducts investigations primarily for divisions within the Public Protection
and Government Bureaus. In addition, the division also investigates cases or matters on occasion for the
Executive Bureau, or in conjunction with the Criminal Bureau.

Division investigators locate and interview victims, witnesses, subjects, and others; obtain and review
documentary evidence from numerous sources, including individuals, corporations, and federal, state,

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PUBLIC PROTECTION BUREAU INVESTIGATIONS DIVISION

county, and municipal agencies; conduct surveillance, background checks, and asset checks; analyze financial
records and perform other forensic accounting functions; and testify before grand juries and at trial. In
some cases, investigators worked closely with other state attorneys general, district attorneys, local and
state police departments, the U.S. Attorney's Office, the U.S. Postal Inspection Service, the Federal
Bureau of Investigation, and the Federal Trade Commission.

The Investigation Division included Karen Ortolino, Director; Quinton Dale, Deputy Director;
Kerri Burridge; Monique Cascarano; Amy Cederholm; Mayra Connolly; Todd Davis; Ashley Dizel;
Todd Dumas; Eric Funk; Jim Gentile; Karen Leary; Matthew McMahon; Lou Russo; Janice Spillane;
Dawn Valchuis; and Nancy Ward.

In Fiscal Year 2002, the division initiated 333 investigations in the following major areas:

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

PUBLIC PROTECTION BUREAU

Consumer Protection and Antitrust Investigators continued to assist the office in bringing
G.L. c. 93A enforcement actions against businesses and individuals in major consumer areas.
The division initiated several investigations and surveys to determine compliance with existing
consumer laws and regulations, including multi-state and nationwide investigations into fraudulent
sweepstakes promotions and telemarketing scams. The division also participated in Internet
scams, the gun enforcement initiative, and healthcare.

Investigators worked with the Criminal Bureau's Consumer Protection Prosecutor on numerous
cases that resulted in indictments and convictions against individuals for violations of the
Commonwealth's criminal laws. Cases included larceny against the elderly and vulnerable
populations by home improvement contractors and a travel agent; unlicensed practice of medical
professions', telemarketing fraud; and illegal charitable fundraisers.

Civil Rights and Civil Liberties The division investigated hate crimes, allegations of police
misconduct, and other violations of the Massachusetts Civil Rights Act. Investigations were also
conducted into allegations of discriminatory housing and employment practices, as well as
investigations to determine compliance with the rules and regulations established by the Americans

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PUBLIC PROTECTION BUREAU INVESTIGATIONS DIVISION

with Disabilities Act and the Architectural Access Board. The division also participated in a retail
sting involving allegations of racial profiling.

Environmental Protection The division's role in EPD cases primarily involved locating and
identifying assets of potentially responsible parties liable for paying costs incurred by the
Commonwealth in the clean-up of polluted or hazardous waste sites. Investigators also located
former employees and officers of defunct companies responsible in part for such violations, and
reviewed, evaluated, and analyzed financial documents and prepared ability to pay analyses.

Public Charities The division investigated individuals associated with organizations that raised
funds from the public in violation of Massachusetts law. In some instances, solicitors posed as
law enforcement or other public officials or otherwise misrepresented themselves or the charity's
purpose. Investigators worked with other law enforcement personnel in locating couriers who
picked up donations.

Insurance Investigators worked with attorneys in the Insurance Division to review and investigate
businesses and organizations that withheld employee contributions for health insurance premiums
but failed to actually purchase the health insurance coverage. Other cases investigated included
churning and the sale of fraudulent or costly life and health insurance policies.

GOVERNMENT BUREAU

Trial Division 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 that occurred
on state-owned property and/or in accidents on state roads or involving state vehicles. The
division also investigated cases involving contract disputes and eminent domain proceedings and
allegations of overcharging by schools subject to Department of Education and Office of Child
Care Services (OCCS) regulations.

COMMUNITY-BASED JUSTICE BUREAU

Safe Neighborhood Initiative (SNI) The division assisted the Attorney General's Abandoned
Properties Project by conducting research on target properties in several communities, primarily
to determine the status of ownership and existence of encumbrances of the buildings, and, in

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PUBLIC PROTECTION BUREAU

DIVISION OF PUBLIC CHARITIES

some instances, assisted in inspecting properties scheduled for renovation. During the fiscal year,
the division researched properties in Taunton, New Bedford, Worcester, and Brockton.

STATISTICAL SUMMARY

The division opened 333 investigations in Fiscal Year 2002, with 345 investigations ongoing as of
June 30, 2002.

DIVISION/BUREAU

Consumer Protection/ Antitrust

Civil Rights

Public Charities

Insurance

Utilities

Consumer Protection Prosecuto

Government

Environmental Protection

Trial

OPENED DURING

ONGOING AS

FISCAL YEAR 2002

OF 6/30/02

233

183

TOTAL

333

345

DIVISION OF PUBLIC CHARITIES

The Attorney General represents the public interest in the proper solicitation and use of charitable
funds and is authorized to "enforce the due application of funds given or appropriated to public charities
within the commonwealth and prevent breaches of trust in the administration thereof . " G.L. c. 12, § 8.
The Division of Public Charities was established to carry out the Attorney General's responsibilities in
this area.

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More than 30,000 charities are registered with the division in addition to over 300 professional
fundraisers presently soliciting donations on behalf of charities in Massachusetts. A public charity is an
entity that is non-profit, whose purpose is charitable, and that benefits a portion of the public; in addition
to philanthropic organizations, examples of public charities include non-profit 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.

The single most visible case involving the division in Fiscal Year 2002 was the investigation of the sale
of the Boston Red Sox. In that investigation and the subsequent agreement to resolve the dispute, the
Office and division stepped in to ensure that the interests of a charity, The Yawkey Foundation II, were
fully protected.

Health care also continued to be an area in which the division performed considerable work. Consistent
with the Office's strong interest in resolving problems related to the delivery of health care, the division
has reviewed and monitored the actions of a number of the significant non-profit healthcare institutions
that are public charities in Massachusetts, including both hospitals and insurers. The division engages in
these corporate governance and oversight initiatives to ensure that the governing boards of these institutions
have carried out their fiduciary duties of due care and loyalty.

The division also spent considerable effort following the attacks of September 1 1 , 2001 , responding
to an outpouring of requests and inquiries that came in from the public, charities, and fundraisers. In the
wake of the attacks, members of the division fielded hundreds of queries in many different forms pertaining
to how individuals and organizations could fundraise to assist victims of the attacks. In addition, in one
case, the division sued a married couple allegedly engaged in fraudulent fundraising, asserting they were
fundraising for victims of September 1 1 th but in fact were keeping the proceeds.

More generally, during Fiscal Year 2002 the division continued its activities in two other primary
areas: enforcement litigation to address deception and fraud in charitable fundraising and estate and trust
actions to ensure that charitable trust funds were appropriately administered and applied.

The division also recognizes that charities provide vital services in our communities while both enjoying
certain benefits due to their tax-exempt status and assuming certain obligations. As a result, the division
was involved in a number of initiatives in Fiscal Year 2002 intended to strengthen the charitable sector.
These efforts included presentations to various public groups and bar organizations on charities issues,
issuing the division's annual report on charitable fundraising, and working with the Boston Bar Association
on legislation that would revise the non-profit corporation statute.

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The Division of Public Charities staff included: Jamie Katz, Division Chief; Marion Antonucci;
Caitlin Calder; Sandra Cardone; Eric Carriker; Patricia Clifton; Kevin Fennessey; Daniel Ferullo; Ann
Giroux; Ann Higgins; Cathy Hoffman; Laura Maslow-Armand; Beth McGillicuddy; Kathleen O'Connell;
Richard Reuss; Deirdre Rosenberg; Johanna Soris; and Tina Williams.

SIGNIFICANT CASE SUMMARIES

CHARITY GOVERNANCE

The Attorney General's oversight of charitable corporations focuses on stewardship by charity boards
of directors. The division may become involved when directors breach their individual fiduciary duties
of due care and loyalty or to prevent the misuse of charitable funds. In some cases, the division has
engaged in investigations and then negotiated governance agreements that provided for reforms in how
charities will operate. In other cases, the division brought enforcement actions in court after investigations.
This fiscal year, the most significant matters included:

• Sale of the Red Sox The division, working with others in the Office, reviewed the sale of the
majority interest in the Red Sox by trustees of the Jean Yawkey Trust. Because the terms of the
Jean Yawkey Trust directed the transfer of the assets of the Trust to go to The Yawkey Foundation
II, the division had authority to see to the "due application" of charitable assets. After meeting
with representatives of the Jean Yawkey Trust and the Red Sox, prospective bidders, limited
partners in the Red Sox, and Major League Baseball, the Office determined that the sale, as the
Red Sox proposed it, raised serious conflict of interest and fair market value issues. As a result,
the Office entered into discussions with various parties involved in the sale. Ultimately, the
Office agreed to a settlement providing $30 million more for The Yawkey Foundation II and a
new foundation to be set up by the group of purchasers led by John Henry. The settlement also
included an extensive governance agreement with The Yawkey Foundation II.

• Chinese Consolidated Benevolent Association The division continued its oversight of the
operations of CCBA, a large Chinatown charity, focusing on improving its financial stability and
accountability and ensuring that the organization is run properly in accordance with its by-laws.
The division has a lawsuit pending against the charity and has worked with an interim CEO,
who has directed the organization in accordance with a court order obtained by the division.

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FOR-PROFIT ACQUISITIONS

The Public Charities Division continued to devote considerable time and resources to reviewing
proposed for-profit acquisitions of healthcare providers and other charitable corporations. 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 spent considerable time reviewing a proposal by the Delta Dental insurer
to establish a for-profit subsidiary. Ultimately, after extensive negotiations and agreement by Delta
Dental on a variety of conditions for the transaction, the division agreed to allow the creation of the
subsidiary.

REVIEW OF ASSET DISPOSITIONS

Under amendments to the Non-Profit Corporations Act, which took effect in April 1 990, a charitable
corporation must give 30 days advance written notice to the Attorney General before making a sale or
other disposition of all or substantially all of the charity's assets if the disposition involves or will result in
a material change in the nature of the activities conducted by the corporation. G.L. c. 180, § 8A(c). On
a regular basis and in substantial volume, the division reviews correspondence and documents about
transactions involving charities.

Among the most significant transactions involving proposed disposition of substantial charitable
assets were:

• Bradford Colleg e The College closed following the conclusion of the spring semester in
2000. The division discussed and resolved a variety of issues concerning the College's handling of
restricted funds. In addition, the division met with College representatives and others to deal
with ongoing issues related to the disposition of the College's assets in the face of substantial
debts owed by the College. In particular, the sale of the College's real estate became very contentious
in Fiscal Year 2002. The City of Haverhill and its residents had many concerns about potential
bidders for the property, and the division spent a considerable amount of time dealing with the
real estate sale until it was resolved, shortly after the close of Fiscal Year 2002.

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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,
§1 1 A. After review, negotiation of necessary modifications, and assent by the division, the pleadings are
filed by the dissolving charity in the Supreme Judicial Court. The division reviewed many transactions
involving proposed dissolutions.

SOLICITATION OF CHARITABLE FUNDS

The Attorney General takes affirmative legal action against charities and professional fundraisers for
unfair or deceptive solicitation practices and to enforce their fiduciary duties with respect to funds raised.
In addition to injunctive relief, 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.

• Response to September 1 1th The division received hundreds of calls from members of the
public, charities, fundraisers, and the press concerning the legitimacy of charities or charitable
solicitations, as well as how to fundraise for the World Trade Center (WTC) victims. The
division sent out enormous amounts of material and information to individuals on fundraising
issues. The division produced and then revised an advisory on charitable solicitation in the wake
of the tragedy, and communicated regularly with the Red Cross and other charities to coordinate
our response and to exchange information about specific solicitations. The division worked with
other government agencies in connection with charities scams and questions raised about charities
that might be linked to al Qaeda.

• New England Kids Network (Norfolk Superior Court) The division filed a complaint
alleging that owners of a commercial car donation company deceived the public through advertising
that contained material omissions and misrepresentations. The division obtained a Consent
Judgment and a $5,000 penalty against the owner, Jeffrey Pollack, and an Assurance of
Discontinuance with a $5,000 penalty against Lisa Pollack, his wife.

• Commonwealth v. Jeffrey R. Scott and Dawn A. Scott (Hampshire Superior Court) This
action alleged that the Scotts engaged in deceptive, unauthorized, and unregistered solicitation
under the banner of September 1 1th disaster relief. The Scotts solicited funds and sold flag

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decals, purportedly for September 11th charities, but never turned over the funds to charities and
commingled the charities, funds with their own. Working with members of the Western
Massachusetts Office, the division obtained a preliminary injunction against further fundraising
by the Scotts.

ESTATES AND TRUSTS

In furtherance of his authority to "enforce the due application" of charitable trust funds and to
"prevent breaches of trust in the administration thereof," the Attorney General is an interested party in
the probate of all estates in which there is a charitable interest and in all other judicial proceedings affecting
charitable trusts.

Accordingly, the division continued to handle a large volume of cases in this area involving such
matters as proposed allowance of accounts, will compromises, sale of real estate, change of purposes or
beneficiaries of charitable trusts and bequests, amendment of charitable trusts to meet IRS requirements,
and termination of charitable trusts under G.L. c. 203, § 25.

WILLS, TRUSTS, AND OTHER PROBATE STATISTICS

During Fiscal Year 2002, the division received and reviewed 845 new wills, and received and reviewed
690 interim accounts for executors and trustees, as well as 594 final accounts. In addition, the division
received, reviewed, and assented to 38 petitions for license to sell real estate and received and reviewed
823 miscellaneous complaints and filings.

During the reporting year, the division assented to 88 final judgments dissolving charitable corporations
pursuant to section 1 1 A.

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HEALTHCARE INITIATIVES

The division was involved in a variety of efforts to analyze and stabilize the healthcare sector.

CareGroup The division continued to spend considerable time and effort in investigating and
monitoring the financial and operating condition of CareGroup and its affiliates (Beth Israel
Deaconess Medical Center, Mt. Auburn Hospital, New England Baptist Hospital, Deaconess
Nashoba Hospital, and Deaconess Waltham Hospital) . Division staff reviewed a large volume of
documents, meeting with representatives of the system and the affiliates, and worked with experts
hired by the Office to assess, on a regular basis, whether the board and officers of the healthcare
system were turning around the hospital's operation.

In particular, the division also ran a review under G.L. c. 180, § 8A(c) of CareGroup's transfer of
Deaconess Waltham Hospital to a community board while the real estate went to a Waltham for-
profit real estate developer. That review, including a public hearing, concluded that the transfer
could proceed, though the newly reconstituted hospital faced significant challenges.

G.L. c. 180, § 8A(d) reviews Another area that required extensive efforts by the division was in
the review of healthcare transactions. Under the recently enacted G.L. c. 180, § 8A(d), the
Legislature required the Office to review an expanded range of healthcare transactions between
non-profit hospitals and HMOs and other for-profit institutions. The division reviewed certain
transactions under this statute in Fiscal Year 2002 and also established written guidelines to provide
charities and the public with information on how the statute will be implemented.

Harvard Pilgrim Health Care During Fiscal Year 2002, division personnel dealt with issues
arising out of the Harvard Pilgrim Health Care receivership. The division worked with Harvard
Pilgrim over a variety of issues, including governance and engaging an independent healthcare
analyst.

SIGNIFICANT INITIATIVES, ACTIVITIES, AND EFFORTS

Technology and Public Access The division, working with others in the Office, enhanced the
Charities Web page, enhancing the information we provide to charities and the public. All of the
brochures and materials that the division provides appear on the Web site.

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PUBLIC PROTECTION BUREAU DIVISION OF PUBLIC CHARITIES

In another step both toward giving the public more access to division public records and toward
electronic registration with the division by charities, the division began a document imaging
program. The program involves the scanning of documents filed with the division so that division
personnel can review them on a computer. Once the system is up and running, the division will
provide the public with access to the scanned documents.

Public Education The division continued its ongoing public education efforts regarding charitable
giving and charity stewardship. In addition to continuing distribution of a wide variety of public
education materials, the Chief 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.

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 1 ,086 requests to view files in the past fiscal
year, and, in response, approximately 3,012 files were pulled.

CHARITABLE ORGANIZATIONS: REGISTRATION AND ENFORCEMENT

From July 1, 2001 through June 30, 2002, the division processed approximately 16,385 annual
financial reports and annual filing fees totaling $ 1 ,669,702. During this period, 590 new organizations
were reviewed, determined to be charitable, and registered. Each was sent the division's packet of
information about the registration and filing requirements.

As part of an ongoing compliance program, division staff contacted charities whose annual filings
were deficient or delinquent to rectify filing deficiencies.

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ISSUANCE OF CERTIFICATES TO CHARITIES THAT FUNDRAISE

Under G.L. c. 68, § 19, every charitable organization that 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.

REGISTRATION OF PROFESSIONAL SOLICITORS AND FUNDRAISING COUNSEL

Under G.L. c. 68, §§ 22 and 24, all persons acting as professional solicitors, professional fundraising
counsel, or commercial 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. All fundraisers must also file with the division a copy of each fundraising contract
that they sign with any charitable organization, and solicitors must later file a financial return regarding
each fundraising campaign.

During Fiscal Year 2002 , the division received and approved a total of 3 1 4 registrations, resulting in
$62,850 in fees to the Commonwealth. Registrations were received from 89 solicitors, 166 fundraising
counsel, and 59 commercial co-venturers

MONEY RECOVERED FOR THE COMMONWEALTH

Charitable and Fundraiser Registration Fees $1 ,732,552

Other fees, requests for copies, requests for computer information $ 1 ,493

TOTAL $1,734,045

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PUBLIC PROTECTION BUREAU UTILITIES DIVISION

UTILITIES DIVISION

The Utilities Division represents utility consumer interests and is authorized to intervene in
administrative or judicial proceedings on behalf of consumers in connection with any matter involving
the rates, charges, prices, or tariffs of an electric, gas, telephone, or telegraph company doing business in
the Commonwealth and subject to the jurisdiction of the Department of Telecommunications and
Energy (Department or DTE) G.L. c. 12, § 1 IE. The division's work is carried on before state and
federal courts as well as administrative regulatory bodies such as the Department, the Federal Energy
Regulatory Commission (FERC), and the Federal Communications Commission (FCC). In many of
these matters, particularly public utility rate cases, the division is the only active participant advocating on
behalf of Massachusetts consumers.

The bulk of the workload of the Utilities Division in Fiscal Year 2002 involved advocacy of consumer
interests in connection with the implementation of the dramatic changes underway in the telephone,
electric, and gas utility industries. The implementation of the 1997 Electric Restructuring Act (St. 1997,
c. 164) continued with proceedings on the annual transition cost reconciliation filings, the provision of
default service, and generating unit sales. Work continued among interested parties to enhance competitive
electric markets, and further progress was made on expanding the range of activities in which local and
wholesale competition could occur in the telecommunications industry. The division was an active
participant in each of these developments. Not only did the division continue its traditional role of
protecting customers from natural gas company distribution rate increases, but, for the first time in
decades, it filed a petition with the Department, pursuant to the Attorney General's authority under G.L.
c. 164, § 93, which resulted in lower rates for electric consumers in the Fitchburg area. The division
continues to protect the interests of residential and business customers during the transition to new
regulatory frameworks. Most of this work occurred in case-specific adjudications.

During Fiscal Year 2002, the Utilities Division included Joseph Rogers, Division Chief; Wilner
Borgella; Michelle Cataldo; Alexander Cochis; Mary Flohr; Pat Kelley; Jennifer Koch; Claudine Langlois',
Judy Laster; Leo Lawless; Timothy Newhard; Doe Pichard; Karlen Reed; and Andrea Simon.

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ELECTRIC MATTERS

RATE CASES

• Fitchburg Gas & Electric Light Company. D.T.E. 99-118 (Department of
Telecommunications and Energy) On December 31,1 999, the Attorney General filed a complaint,
pursuant to G.L. c. 164, §93, the rate complaint statute, requesting a Department investigation
of the distribution rates of Fitchburg Gas & Electric Light Company. The division claimed that
the Company's distribution rates for calendar year 1999 were excessive. Section 93 permits the
Department to order a reduction or change in the rates upon petition of the Attorney General
after notice and a hearing. Hearings were conducted at the end of May and beginning of June,
and briefing was completed by July 17, 2001.

On October 18, 2001, the Department found that Fitchburg 's current rates were "neither just
nor reasonable" and ordered an immediate $1,740,426 or 8% reduction in distribution rates.
This decrease was evenly distributed across all rate classes. Since this reduction remains in effect
each year until altered by another rate order, the savings to consumers over time may be very
substantial. The Department also issued favorable ruling clarifying the Attorney General's rights
to seek rate reductions or improvements in service quality under § 93.

• Sithe New Boston. Docket No. ER02-648 (Federal Energy Regulatory Commission) On
December 28, 2001, Sithe New Boston filed with the FERC a Reliability Must Run (RMR)
Agreement with the Independent Service Operator New England, Inc. (ISO-NE) to provide
generation services in support of transmission during periods of peak demand in Boston. The
RMR agreement sought recovery of the charges allegedly associated with provision of reliability
services to ISO-NE from Sithe New Boston's electric generating facility located near downtown
Boston, Massachusetts. The proposed agreement is in the nature of a transmission support
arrangement and is unique to the New England power market. Given the potential precedent
that may result from this filing, the division intervened in the matter and requested that the
FERC conduct evidentiary hearings into the company's cost of providing this service. The division
is participating in ongoing negotiations.

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SERVICE QUALITY AND SUMMER 2001 DISTRIBUTION OUTAGES

• NSTAR, D.TE. 01-65. Western Massachusetts Electric Company. D.T.E. 01-66. Fitchburg
Gas & Electric. D.T.E. 01-67. Massachusetts Electric Company. D.T.E. 01-68 (Department
of Telecommunications and Energy) The Restructuring Act required the Department to set
service standards to ensure that service quality does not suffer as a result of restructuring. The
electric distribution companies (NSTAR, Massachusetts Electric Company, Fitchburg Gas &
Electric Light Company, and Western Massachusetts Electric Company) filed Service Quality
Plans pursuant to a June 2001 order of the Department. In addition, a number of distribution
outages occurred during the summer of 200 1 .

The division attended 14 statewide public hearings on the proposed service quality filings of the
companies. The purpose of the public hearings was to take public comments from customers
concerning this summer's distribution outages and determine what penalties should be imposed
for poor service. The hearings took place in Brookline, Stoneham, Brockton, Lunenburg, Boston,
New Bedford, Worcester, Medfield, Pittsfield, Hyannis, Greenfield, Haverhill, Arlington, and
Gloucester. The division offered public statements regarding each company's filing and requested
evidentiary hearings on service quality plans and outage reports.

On March 22, 2002, the Department issued an order requiring that both NSTAR and Mass
Electric take certain actions to upgrade their distribution systems and report back to the Department
by June 2002 regarding their plan for implementing the required changes. The order deferred the
request of the division to conduct a management audit of NSTAR until an unspecified date. The
order also rejected the request of the division to levy a fine of $22.5 million against NSTAR for
service quality and distribution system failures that caused the outages from summer 2001 . Instead,
the Department supported NSTAR's proposed calculation that it receive a much smaller fine,
and issued a penalty of $3,207, 1 4 1 for Boston Edison Company and $42,358 for Commonwealth
Electric Company to be refunded to customers over the following month. The DTE also issued
an order on March 22, 2002 that fined Mass Electric $5,774,000 in net penalties.

COMPLIANCE WITH DEPARTMENT ORDERS

• Boston Edison Company. D.P.U./D.TE. 97-95 (Department of Telecommunications and
Energy) As a result of the Department investigation of Boston Edison Company's (BECo)
request to form a holding company (Docket D.T.E. 97-63), allegations of cross-subsidization by

PUBLIC PROTECTION BUREAU UTILITIES DIVISION

the utility of its unregulated subsidiaries were made. To address these concerns, the Department
opened Docket D.T.E. 97-95 to investigate BECo's transactions with its unregulated affiliate,
Boston Energy Technology Group (BETG).

In 1993, the Department authorized Boston Edison to create BETG and allowed the Company
to invest up to $45 million in the affiliate. BETG's subsidiary, BECoCom, entered into a joint
venture with Residential Communications Network (RCN) to provide cable and telephone service.
To fund the joint venture, Boston Edison made non-cash contributions to BECoCom of the
utility's fiber-optic network and the exclusive use of certain utility rights of way. Boston Edison
transferred the fiber-optic network at net book value, about $1 1.3 million. The division and
Cablevision maintained that BECo's fiber-optic network has an economic value of between $39. 1
million and $67.0 million. Therefore, this transfer violated the Department's previous order
limiting the amount of money Boston Edison could invest in BETG.

Evidentiary hearings were conducted on 27 days between December 1998 and April 1999. The
division argued that the D.P.U. 93-37 Order did not and could not have authorized Boston
Edison to pursue investments outside the areas of DSM services, electric vehicles, and electric
generation, which was what the Company requested authority to invest in. Accordingly, the
division requested that the Department find the Company's investment in commercial
telecommunications services violated D.P.U. 93-37.

On December 28, 2001 , the Department issued an order finding that Boston Edison Company
exceeded the $45 million investment cap set by D. P. U. 93-37 by excess investment of $3,936,881
and ordered that BETG reimburse that amount to NSTAR and that it also refund to customers
the interest, at 10.46%, associated with the over-investment of $3,936,881 from December 31,
1997, in the form of a credit to the Company's transition costs. This resulted in approximately
$2 million in interest charges.

ELECTRIC RESTRUCTURING MATTERS

• Massachusetts Electric Company and Nantucket Electric Company. D.T.E. 01-68. D.T.E.
01-71B (Department of Telecommunications and Energy) Massachusetts Electric Company
filed a service quality plan with the Department. The Electric Restructuring Act required the
D.T.E. to establish service quality standards to ensure that service quality does not suffer as result
of restructuring.

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The division participated in evidentiary hearings regarding the service quality plan filed by
Massachusetts Electric Company and Nantucket Electric Company and filed an initial brief
maintaining that those companies failed to meet the Department's service quality standards. The
Department issued an order imposing a penalty of $5,774,000 for service quality violations, and
that amount was refunded to customers.

• Default Service Working Group (Department of Telecommunications and Energy) The
Attorney General, Associated Industries of Massachusetts (AIM) , the division of Energy Resources
(DOER), the Energy Consortium (TEC), the Utility Workers Union of America (UWUA), the
Low-Income Energy Assistance Network (LEAN) , NSTAR, and Mass Electric convened a working
group to discuss how to change the pricing structure and procurement of default service a/k/a
provider-of- last-resort service. The Electric Restructuring Act of 1997 created Default Service in
order to ensure that electric service would be available to customers in a competitive market as a
last resort if a competitive supplier did not provide service, or if a customer was not eligible for
standard offer service. In theory, a customer would turn to default service as an interim measure
until replacement competitive service became available. In practice, however, few competitive
supplier-based options exist in the current market for residential and small commercial and
industrial customers. That, coupled with the large number of people who are ineligible for
standard offer service based on the prohibitions under the Act, has created a substantial default
service customer base.

The Default Service Working Group discussed how to change the pricing and procurement
structure of default service in preparation for the end of the statutory transition period in 2005.
At the end of the transition period, standard offer service, which is the service provided currently
to the majority of residential and small commercial and industrial customers, will end, and if a
customer is not served by a competitive supplier, that person will become a default service customer.

This matter was pending at the end of the fiscal year.

LEGISLATIVE CRACKER BARREL

The Commonwealth is halfway through the transition period established by the Electric Restructuring
Act of 1997 to change from a monopoly-regulated electricity system to a competitive market structure.
And, although many of the Act's objectives have been accomplished, some objectives, such as retail
competition accompanied by lower prices, remain unfulfilled in part due to legislative deficiencies of the
Act. In order to address concerns about the Act and in preparation for the end of the transition period,

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Speaker Finneran and Representatives Bosley and Binienda convened a "Cracker Barrel" to host an informal
series of discussions on the retail and wholesale electricity market in Massachusetts.

The public discussions focused on generators, transmission and distribution companies, renewable
energy and waste-to-energy, competitive suppliers, energy efficiency, consumer and environmental groups,
and labor. In addition, they held four public meetings around the state. Based on the suggestions from
the sessions, Representative Bosley may draft legislation to amend the Act. This matter was pending at
the end of the fiscal year.

TRANSITION CHARGE RECONCILIATIONS

The transition charge is a mechanism established by the Electric Restructuring Act of 1997 for an
electric distribution company to recover its allowable stranded costs as a charge to customers. The company
is required by the Electric Industry Restructuring Act, G.L. c. 164, § lA(a), and 220 C.M.R. § 1 1.03(4) (e),
to annually reconcile or "true-up" its transition charges between what was forecast to be recovered and
what was actually in fact recovered through its rates. The division reviews the filing to ensure that only
costs permitted by the Restructuring Act are recovered. The division's work in this area included:

• Western Massachusetts Electric Company. D.T.E. 00-33 (Department of
Telecommunications and Energy) On March 3 1 , 2000, Western Massachusetts Electric Company
(WMECo) filed a request for a Transition Charge Reconciliation covering the period March 1 ,
1998 through December 31, 1999. The division argued that WMECo proposed an unfair
reconciliation of the pension over-funding and post-retirement benefits issues and that the
Company's treatment of the investment tax credit (ITC) and Tariff T-9 charges associated with
the sale of the West Springfield hydroelectric plants did not provide for the "maximum possible
mitigation," as required by the Restructuring Act. On June 7, 2002, the Department issued an
Order that agreed with many important positions argued by the division. As a result, customers
will save approximately $7.34 million on their electric bills through reductions to the Company's
transition charge.

• Fitchburg Gas & Electric Light Company. D.T.E. 99- 1 10 (Department Telecommunications
and Energy). On December 1 , 1999, Fitchburg Gas & Electric Light Company (Fitchburg) filed
for approval its 1999 transition charge reconciliation. The division intervened and raised many
issues concerning the appropriate treatment of particular items that the Company had proposed
for inclusion as transition costs. The Company's transition costs were also reviewed in a
Department-commissioned audit performed by Arthur Andersen. The Department conducted

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four days of evidentiary hearings in May 2000. On October 18, 2001 , the Department issued an
Order agreeing with many of the division's objections and ordering a $2.2 million reduction in
transition costs.

• Boston Edison Company. D.T.E. 00-82 (Department of Telecommunications and Energy)
On November 2, 2000, the Boston Edison Company (NSTAR) filed its 2000 transition charge
reconciliation. The filing was the subject of extensive discovery, and the division and the Company
reached a settlement that was approved by the Department. The Company agreed to forgo
recovery of certain stranded costs to which the division had objected. As a result, ratepayers will
save $2.9 million on their electric bills through reductions to the Company's transition charge.

• Cambridge Electric Light Company and Commonwealth Electric Company. D.T.E. 00-

83 (Department of Telecommunications and Energy) Cambridge Electric Light and
Commonwealth Electric filed for Department approval of their 2000 transition charge true-up.
The division and the Company reached a settlement, approved by the Department, in which the
Company agreed to forgo recovery of certain stranded costs to which the division had objected.
As a result, ratepayers will save $7.8 million on their electric bills through reductions to the
Company's transition charge.

• Fltchburg Gas & Electric Light Company. D.T.E. 01-103 (Department of
Telecommunications and Energy) On December 3, 200 1 , Fitchburg filed with the Department
its Annual Electric Reconciliation Mechanism for 200 1 . The division contested a number of the
charges included in the Company's Reconciliation Filing. The matter is pending at the end of the
fiscal year.

NUCLEAR POWER PLANTS

• Nuclear Waste Yankee Nuclear Power Station, also known as "Yankee Rowe," is a nuclear
power plant located in Rowe, MA, that is permanently shut down and is in the process of being
decommissioned. This plant was the third nuclear power plant built in the United States and the
first built in New England. Yankee Rowe was permanently shut down on February 26, 1992,
after more than 3 1 years of operation. Although the reactor has been dismantled, 533 used fuel
assemblies remain in a storage pool on site. During operation, spent fuel rods are stored in a
water-filled pool in order to cool down. As part of the decommissioning process, the fuel

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assemblies will be removed from the pool and will be stored in large steel-lined concrete containers
for future transport.

The Nuclear Waste Fund (N WF) established by the Nuclear Waste Policy Act of 1 982 (NWPA)
requires a ratepayer surcharge on nuclear power to pay for a central high-level radioactive waste
repository for commercial high-level radioactive waste. A site has been picked for the repository
at Yucca Mountain, Nevada, and DOE recently recommended Yucca Mountain to President
Bush as a site suitable for a central repository. President Bush accepted the Secretary's
recommendation, and by statute, the issue now moves to Congress for final action. The division
sent letters to both Senator Kerry and Senator Kennedy requesting that they support the designation
of Yucca Mountain as the national repository for high-level commercial nuclear waste.

• Cambridge Electric Light and Western Massachusetts Electric Company. D.T.E. 01-94/
01-99 (Department of Telecommunications and Energy) The Cambridge Electric Light Company
and the Western Massachusetts Electric Company filed petitions with the Department for approval
of the sale of their ownership interests in the Vermont Nuclear Power Station to ENTERGY.
The Vermont Yankee Station consists of a single nuclear power plant located in Vernon, VT, with
a nominal capacity of 540 megawatts. Under the terms of the Electric Industry Restructuring
Act, utilities in the Commonwealth are required to sell their generating units. On November
19, 200 1 , the Company filed a petition with the Department requesting approval of the proposed
divestiture and auction sale conducted by J. P. Morgan. The division intervened in the proceeding.
After the close of hearings, the Vermont Yankee Nuclear Power Corporation entered into a
memorandum of understanding with ENTERGY that addressed the issue of excess
decommissioning funds and other areas of concern raised by the division during the hearings.
The division then entered into a separate letter agreement with the Company that obligated the
Company to pass excess decommissioning funds along to consumers. In light of the pass-through
agreement, the division had no objection to the sale. On June 6, 2002, the Department approved
the amendatory agreements.

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PUBLIC PROTECTION BUREAU UTILITIES DIVISI ON

GAS MATTERS

RATE CASES

• Berkshire Gas Company, D.T.E. 01-56 (Department of Telecommunications and Energy)
The Company sought a distribution rate increase of $4.6 million and a 10-year Performance
Based Rate (PBR) plan. The Company also sought approval to recover a $62 million merger
acquisition premium associated with acquisition of Berkshire by the Energy East Corporation.
The division intervened in the proceeding and challenged the alleged revenue deficiency.

The department agreed with numerous arguments of the division and awarded only a $2.2
million increase — $2.4 million less than originally requested. In addition, after vigorous
opposition by the division, the department did not act on the company's request for approval to
recover the $62 million acquisition premium.

• Blackstone Gas Company. D.T.E. 01-50 (Department of Telecommunications and Energy)
On May 15, 2001, Blackstone Gas Company (Blackstone) filed a distribution rate case designed
to increase annual revenues by $220,067 or 36%. Blackstone is the smallest investor-owned
utility in the state and serves approximately 1,000 customers in the towns of Blackstone and
Bellingham. The division intervened in this matter and challenged the company's plant additions,
affiliate transactions, working capital calculations, and numerous other expenses. The department
agreed with many of the division's arguments and issued an order increasing rates only $ 1 1 7,000
per year, saving customers $ 103,000 per year.

GAS COST INCENTIVE AND RISK-MANAGEMENT PROGRAMS

• Bay State Gas Company. DTE 01-81 (Department of Telecommunications and Energy)
On October 26, 2001, Bay State filed a Petition with the Department seeking authority to
establish a Gas Cost Incentive Mechanism (GCIM Proposal). In its GCIM Proposal, the Company
proposed to enter into various financial and physical hedging markets in order to outperform
indexes of certain gas supply contracts. The Company further proposed to give customers 25%
of any net trading gains realized while the Company absorbed any net trading losses incurred.
The provision for the Company to absorb all net trading losses was a concession to the objections
and concerns raised by the division.

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PUBLIC PROTECTION BUREAU UTILITIES DIVISION

The division urged the Department to reject the GCIM Proposal, arguing that the GCIM Proposal
would harm rather than benefit customers because it would increase indirect transaction costs,
the cost of purchased gas, and capital costs. The division further argued that the GCIM Proposal
would stifle competition in the gas supply market. Finally, the division also cautioned the
Department about the possibility of gaming or price fixing under the GCIM Proposal. The
division awaits the Department's Order in this matter.

• Risk-Management Techniques Generic Investigation. DTE 01-100 (Department of
Telecommunications and Energy) On December 4, 2001, the department invited public
comments in connection with its investigation into the appropriateness of the use of Risk-
Management Techniques to Mitigate Natural Gas Price Volatility. In comments filed on January
14, 2002, the division strongly recommended that the department prohibit gas distribution
companies from using financial or commodity derivatives to "hedge" the cost of gas that they
provide to their customers, arguing that allowing companies to use customer funds to buy these
derivatives is fraught with dangers for customers and the utilities; neither utilities, customers, nor
regulators are ready to analyze and evaluate the prudence of transactions in derivatives; and allowing
companies to speculate in the derivatives markets will increase the financial risks for the companies
and increase costs for their customers.

On October 9, 2002, the department issued an Order allowing, but not requiring, LDCs to use
financial risk-management instruments to mitigate commodity price volatility. The department
held that financial risk-management programs should (1) allow customers to volunteer to
participate in the program; (2) maintain the objective of volatility mitigation and price stability
rather than the objective of procuring prices below indices; (3) ensure fair competition in the gas
supply market; (4) allocate all costs to program participants only; (5) demonstrate the effect the
program would have on reliability and transparency of commodity price; and (6) contain no
incentive mechanisms.

TELEPHONE MATTERS

• Verizon's 271 Application to Enter the Long-Distance Market (Federal Communications
Commission) Under the 1996 Telecommunications Act, Verizon, as a regional Bell operating
company, would be allowed to offer in-region long-distance service in Massachusetts only if it
proves under Section 271 of the Act that it satisfies a 14-point local market competitive checklist
and shows that its entry into the long-distance market is in the public interest. Notwithstanding

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PUBLIC PROTECTION BUREAU UTILITIES DIVISION

the division's objections concerning Verizon's compliance with the 14-point checklist, the
Department and FCC approved Verizon's application. The division appealed the FCC's decision
totheD.C. Circuit Court of Appeals on May 11, 2001, asserting that the FCC acted arbitrarily,
capriciously, and contrary to law in approving Verizon's Section 271 application. The division
maintained that: (1) the FCC should have considered evidence that the prices Verizon charged its
competitors to lease its Unbundled Network Elements (UNE) services created a "price squeeze"
that precluded profitable competitive entry by competitors; (2) the FCC erroneously concluded
that Verizon's Unbundled Network Elements switching rates did not exceed their costs; and (3)
the FCC failed to consider evidence that Verizon had not satisfied its Section 271 obligations to
resell DSL service to competitors. During Fiscal Year 2002, the division submitted joint initial
and reply briefs; the appeal is pending at the end of the fiscal year.

• Verizon's Alternative Regulation Plan. D.T.E. 01-31 (Department of Telecommunications
and Energy) On February 27, 2001 , the department opened an investigation into Verizon's retail
intrastate telecommunications services for Massachusetts and then bifurcated the proceeding:
Phase I to investigate whether there is sufficient competition to give Verizon pricing flexibility
for business services, and Phase II to explore the appropriate regulatory plan for services where
there is not sufficient competition. The division participated in procedural conferences, conducted
discovery, filed direct testimony and rebuttal testimony, argued motions, participated in evidentiary
hearings, and filed initial and reply briefs.

On May 8, 2002, the department issued its Phase I Order allowing pricing flexibility to Verizon
for its business services but not residential services. The department directed Verizon to file a plan
for the Phase II investigation that: (1) decreased intrastate switched access service prices to interstate
levels; (2) offset the expected lost revenues by raising residential dial tone rates; (3) allowed
Verizon limited pricing flexibility up to 5% increases each year without departmental review; (4)
made Touch-Tone service mandatory and rolled the price into residential dial tone; and (5) revised
pricing for PAL/PASL (wholesale pay phone charges) and certain collocation rates, with dial tone
increases for estimated resulting lost revenues. Verizon filed its proposed Phase II Plan on June 5,
2002; the department's Phase II investigation is pending at the end of the fiscal year.

• Wholesale Competition (Unbundled Network Elements) D.T.E. 01-20 (Department of
Telecommunications and Energy) As part of a five-year cycle, the department opened its
investigation on January 12, 2001 into Verizon's "Unbundled Network Element" (UNE) prices.
These are the prices that Verizon charges its competitors to lease parts of its network so that they
can provide local telephone service. The division intervened in the docket, filed comments on
Verizon's proposal, participated in procedural conferences and evidentiary hearings (January and

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PUBLIC PROTECTION BUREAU UTILITIES DIVISION

February 2002) , and filed an initial brief. The department's investigation is pending at the end of
the fiscal year.

• Wireless Multi-State Inquiry The division continued its participation in a 26-state
investigation into the billing and advertising practices of Verizon Wireless (formerly Bell Atlantic
Mobile), Cingular Wireless (formerly Cellular One, now part of Southwestern Bell Wireless),
and Sprint PCS. Staff from the Utilities Division and Consumer Protection and Antitrust
Division (CPAD) issued letters in March and October 2001 to the three carriers, participated in
group and state-specific meetings with Verizon Wireless and Cingular Wireless, and scheduled a
multi-state, multi-carrier meeting for August 14-15 in Nashville, TN. The division's inquiry is
pending at the end of the fiscal year.

• Special Access Services. D.T.E. 01-34 (Department of Telecommunications and Energy)
The DTE investigated charges that Verizon overcharged competitors for special access services
(dedicated, end-user-specific phone services that do not go through the public switches) . Division
staff participated in procedural conferences, technical sessions, and evidentiary hearings. The
department's investigation is pending at the end of the fiscal year.

• Network Security. D.T.E. 02-8 (Department of Telecommunications and Energy) The
DTE began investigating concerns Verizon raised about the Department's collocation security
rules and procedures that allow competitors access to Verizon's central offices (competitors can
serve their customers more inexpensively by placing their switching equipment in Verizon's central
offices). The division intervened in the case, participated in public hearings and procedural
conferences, and conducted discovery. The case is pending at the close of the fiscal year.

BANKRUPT CARRIERS

• Net2000/Broadview. D.T.E. 02-14 (Net2000/Broadview). Network Plus. D.T.E. 02-15

(Department of Telecommunications and Energy) The division intervened and participated in
two dockets in which carriers notified the department that they were pulling out of the
Massachusetts local market due to financial difficulties. Both carriers (Net2000 and Network
Plus) filed for Chapter 1 1 bankruptcy, which complicated their ability to give adequate notice to
customers of their withdrawal. During the course of these expedited investigations, the division
attended emergency public hearings, filed briefs, attended bankruptcy asset auctions, and urged
the department to revise its notice requirements so customers had time to find replacement
service. The department accepted the division's arguments and gave customers additional notice.

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PUBLIC PROTECTION BUREAU UTILITIES DIVISION

The department also adopted the division's recommendation that it open a generic docket, similar
to one in place in New York, to devise generally applicable "mass migration" rules to deal with
carrier bankruptcy in the future. The department opened the generic docket at the end of the
fiscal year.

UTILITY MERGERS

• BEC Energy / COM Energy (Massachusetts Supreme Judicial Court) On August 16,
1999, the Attorney General appealed the Department's approval of the petition of Boston Edison,
Cambridge Electric Light Company, Commonwealth Electric, and Commonwealth Gas Company
for the approval of a rate plan associated with the merger of holding companies that created
NSTAR. The division principally challenged the standards used in the Department's decision
that evaluated and assigned $959 million in merger acquisition premiums and transactional costs
to the customers of the new enterprise. In this appeal the division seeks the establishment of just
and reasonable rates by a fair sharing of merger savings. Regardless of the level of anticipated
merger-related savings, unless those savings are passed along to customers in a meaningful manner,
customers pay for the merger and NSTAR enjoys the benefits in the form of higher profits. On
June 24, 2002, the division filed a brief with the Supreme Judicial Court.

OUTREACH, EDUCATION, AND TRAINING

Senior Citizens Group Presentations The Elder Hotline regularly conducts presentations on
behalf of the senior citizen community on matters affecting the community. These presentations
provide information and awareness on various consumer issues, including fraud, scams, sweepstakes,
charitable giving, and utility matters. The division participates in the presentations by explaining
utility bill complaints and the role of the Utility Hotline, utility service and related discount
programs available to seniors, telephone fraud and scams, reading and understanding utility bills,
and common consumer issues and complaints that arise within the division.

Utilities Hotline (1-888-514-6277) The division established a hotline number (1-888-514-
6277) for consumers who had questions or complaints about their electricity, gas, or telephone
service. Since the Hotline was announced on March 5, 2002, it has received about 100 calls each
week.

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PUBLIC PROTECTION BUREAU UTILITIES DIVISION

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

National Association of Attorneys General (NAAG) Energy Conference Attorney General
Reilly and Vermont Attorney General William Sorrell hosted a one-day Energy Conference at the
Fall Meeting of the Eastern Region of the National Association of Attorneys General on November
5, 2001 . Energy sector leaders from government, academia, and the private sector participated in
the conference, and approximately 80 people, including staff from Attorneys General's Offices
throughout the Eastern Region, consumer advocates, government officials, business leaders, and
press attended the conference.

New England Market Power Study The division and the ISO-NE commissioned a study of
electric market power issues in the New England market by James Bushnell and Celeste Sara of
the University of California Energy Institute. "An Empirical Assessment of the Competitiveness
of the ISO New England Electricity Markets" was a preliminary study of the competitiveness of
the New England electricity market for the period May 1999 through May 2001.

The study used a "Competitive Benchmark Analysis" methodology, comparing the "benchmark,"
an estimate of the market price (a hypothetical competitive market where no firm can exercise
market power), to observed market prices. The study concluded that, based on the analysis of
available data, prices for power in New England were on average between 4% and 16% higher
than the costs estimated for a perfecdy competitive market. The results were consistent with the
results of similar studies of the California and PJM electricity markets. The division plans further
studies in this area.

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PUBLIC PROTECTION BUREAU UTILITIES DIVISION

STATISTICAL SUMMARY

During Fiscal Year 2002, the Utilities Division saved customers approximately $26,483,426. The
major recoveries occurred in the following cases:

Fitchburg Gas & Electric Light Company, D.T.E. 99-1 18 $1,740,426

Fitchburg Gas & Electric Light Company, D.T.E. 99-1 10 $2,200,000

Boston Edison Company, D.P.U./D.TE. 97-95 $2,000,000

Boston Edison Company, D.T.E. 00-82 $2,900,000

Western Massachusetts Electric Company, D.T.E. 00-33 $7,340,000

Cambridge Electric Light Company/

Commonwealth Electric Company, D.T.E. 00-83 $7,800,000

Berkshire Gas Company, D.T.E. 01-56 $2,400,000

Blackstone Gas Company, D.T.E. 01-50 $103,000

TOTAL $26,483,426

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PUBLIC PROTECTION BUREAU MEDIATION SERVICES DIVISION

MEDIATION SERVICES DIVISION

SIGNIFICANT INITIATIVES, EFFORTS, AND ACTIVITIES

STUDENT CONFLICT RESOLUTION EXPERTS

Founded in 1989, the Student Conflict Resolution Experts program (SCORE) is a school-based
program that uses trained student mediators to resolve conflict among peers. The SCORE program
provides grants for the development of school mediation programs using trained student mediators to
resolve violent and potentially violent conflicts among their peers. The SCORE program forges partnerships
between educators and mediators to establish quality student-centered mediation programs in the
Commonwealth's schools to prevent disputes from escalating into violence.

Typically, mediated conflicts have involved physical fights, threats, harassment, and rumors among
students who know one another. In Fiscal Year 2002, the Attorney General awarded $420,000 to 26
schools across Massachusetts. Among the communities participating in the SCORE program were Boston,
Dartmouth, Fall River, Greenfield, Holyoke, Lowell, Lynn, Maiden, Medford, Pittsfield, Quincy,
Somerville, Springfield, Taunton, Wakefield (located in a regional vocational high school that serves 12
communities north of Boston) , and Worcester.

Student mediators in SCORE programs mediated 2,385 conflicts involving 6,201 youth; 97% of
these were resolved through the use of peer mediation. The conflicts included situations involving
physical fights, harassment, name-calling, stealing, threats, bullying, property damage, and rumors.

In addition to the financial grants provided to the schools by the Attorney General, division staff
maintained close contact with participating schools through grant monitoring and by offering technical
assistance. During the fiscal year, division staff served as training faculty for student mediator training
events in which 1 68 new mediators received training. In addition, division staff also provided advanced
training and support to adult mediation program coordinators.

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PUBLIC PROTECTION BUREAU MEDIATION SERVICES DIVISION

CONFLICT INTERVENTION TEAM

The Conflict Intervention Team (CIT) , led by the Attorney General's Office, is a collaborative project
of the Attorney General, the Massachusetts Department of Education, and the Massachusetts Association
of Mediation Programs and Practitioners. Composed of a network of specially trained community
mediators, CIT provides mediation services, on a short-term basis, to schools experiencing large-scale
conflicts. In addition to the in-kind contributions of Attorney General staff assigned to the project, CIT
is funded by a grant from the Hewlett Foundation.

In Fiscal Year 2002 CIT was dispatched to address conflict in five Massachusetts schools. Of these
five schools, three were high schools, two were middle schools, two were suburban schools, and three
were urban schools. Race-related issues were a significant factor in four of the five conflict situations;
females were the central perpetrators of conflict in four of the interactions.

FACE-TO-FACE CONSUMER MEDIATION

The Face-to-Face Consumer Mediation Program (FTF), established in 1983 to provide mediation
services for the resolution of consumer and landlord/tenant disputes, offers disputants a convenient, non-
adversarial alternative to court action. In Fiscal Year 2002, the Office of the Attorney General awarded
grants, totaling $315,000, to nine community mediation programs across Massachusetts, including
programs in Brockton, Fitchburg, Greenfield, Haverhill, Hyannis, Lowell, Somerville, Springfield, and
Worcester.

This $3 1 5,000 investment in mediation resulted in the return of $ 1 , 1 1 1 ,827 in cash and $202,465
in non-cash value to Massachusetts consumers. The nine community programs mediated 2,306 disputes
involving auto repairs, home improvement, landlord/tenant issues, debt collection, and broken contracts.

In addition to the financial grants provided to community mediation programs, division staff
maintained close contact with participating programs through grant monitoring activities and technical
assistance. Throughout the fiscal year, division staff frequently served as training faculty for basic training
sessions for new volunteer mediators, provided advanced training for experienced community mediators,
oriented new program coordinators, and provided regional forums for participating programs to share
strategies and resources.

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PUBLIC PROTECTION BUREAU MEDIATION SERVICES DIVISION

OUTREACH, EDUCATION, AND TRAINING

During Fiscal Year 2002, division staff participated in a wide range of outreach and training events
concerning the application of mediation and violence prevention strategies:

A Prerequisite for Safe Schools: Protecting Students from Hate Crimes and Harassment

(October 11, 2001 and March 13, 2002) Mediation Services Division staff, in collaboration
with staff from the Civil Rights Division and the Community-Based Justice Bureau, designed
and delivered A Prerequisite for Safe Schools: Protecting Students from Hate Crimes and Harassment,
two in a series of statewide conferences for teachers, school administrators, and law enforcement
professionals. These conferences, attended by 375 persons, were held in Milford and Falmouth.

Working Together to Change the Sports Culture in Massachusetts: The Massachusetts
Alliance for the Promotion of Sportsmanship (November 18, 2001) Division staff, in
collaboration with staff from the Criminal Bureau, designed and delivered a general session titled
Working Together to Change the Sports Culture in Massachusetts: The Massachusetts Alliance for the
Promotion of Sportsmanship at the 8th Annual Sportsmanship Summit of the Massachusetts
Inter-scholastic Athletic Association. This session, which was attended by nearly 400 student
athletes, coaches, athletic directors, and school administrators, focused on preventing and
responding to violence in sports.

Recognizing and Responding to Hate and Harassment in Schools (January 11, 2002 and
April 2, 2002) Division staff, in collaboration with Civil Rights Division staff, designed and
delivered a Recognizing and Responding to Hate and Harassment in Schools training for Marlborough
Public Schools (nearly 700 school personnel attended) and 30 administrators of the Nashoba
Valley Regional School District.

Mediating with Gay and Lesbian Families (February 9, 2002) Division staff served as a presenter
at a daylong training titled Mediating with Gay and Lesbian Families at the Community Dispute
Resolution Center in Cambridge.

Promoting Tolerance and Respect: A Symposium on Addressing Hate Crimes.
Discrimination, and Harassment (April 20, 2002) Division staff, in collaboration with Civil
Rights Division staff, designed and delivered Promoting Tolerance and Respect: A Symposium on
Addressing Hate Crimes, Discrimination, and Harassment. This symposium, attended by nearly
50 persons, was designed specifically to meet the needs of the Muslim, Arab, and Southwest

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PUBLIC PROTECTION BUREAU MEDIATION SERVICES DIVISION

Asian communities in Lowell as a response to acts of hate and harassment that occurred in the
wake of September 1 1th.

Citizen Schools (April 2002) Division staff participated in the Attorney General-sponsored
Citizen SchooIsyouXh apprenticeship program by delivering a workshop about active listening for
students of the Grover Cleveland Middle School in Dorchester.

Internet Safety (May 1 5 , 2002) A division staff member served as a trainer for an Internet safety
segment on AT&T Broadband's Homework Helplinecable television show. The one-hour segment
aired in Boston, Framingham, and Brookline.

Shaken Baby Syndrome Prevention (May 30, 2002) Division staff, as a Children's Protection
Project activity, assisted the Central Massachusetts Shaken Baby Syndrome Round Table to develop
and deliver a conference titled From Awareness to Action: The Central Massachusetts Shaken Baby
Syndrome Prevention Campaign. This event, attended by over 200 persons, served to heighten
the awareness of the incidence of SBS and to launch a coordinated prevention response.

2002 Peacemakers' Summit (June 2002) Division staff served as members of the planning
committee for the 2002 Peacemakers' Summit, an event that attracted nearly 900 youth mediators
from across Massachusetts at Hampshire College on June 5 and June 6, 2002. At the Summit,
MSD staff designed and delivered Tuning In, a workshop about effective communication in
mediation, to 50 elementary school students, and, in collaboration with the Western Massachusetts
Division, designed and delivered Recognizing and Responding to Bullying, Harassment, and Hate
in Schools, a workshop for 50 elementary and middle school students.

In addition to outreach events, MSD staff served on the Massachusetts Violence Prevention Task
Force, the Massachusetts Department of Public Health's Club Drug Task Force, the Massachusetts
Hate Crimes Task Force, and the Attorney General's Coalition on Underage and Problem Drinking.

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REGIONAL OFFICES

Western Massachusetts

Central Massachusetts

Southeastern Massachusetts

REGIONAL OFFICES WESTERN MASSACHUSETTS DIVISION

Regional Offices

WESTERN MASSACHUSETTS DIVISION

The Western Massachusetts Division of the Office of the Attorney General, located at 1350 Main
Street, Springfield, and a part of the Regional Operations Division of the Executive Bureau, is responsible
for handling affirmative criminal and civil investigations and litigation, as well as civil defensive litigation
and administrative law matters arising in the four Western Massachusetts counties: Hampden, Hampshire,
Franklin and Berkshire. The Government Bureau's statewide Municipal Law Unit is also housed in the
Western Massachusetts Division and provides by-law review and approval, as well as training and advice
to town and municipal officials throughout the state. The Business and Labor Protection Bureau (BLPB)
Fair Labor Division's Western Massachusetts office is responsible for enforcing the state's wage and hour
laws on behalf of the citizens of Western Massachusetts. The division also handles a large number of
consumer complaints and provides educational outreach to area residents. The division consists of full-
time staff members: a division chief, deputy division chief, ten assistant attorneys general, three civilian
investigators, a consumer liaison, one investigator assigned to BLPB's Medicaid Fraud Unit, four
Massachusetts State Police Officers, four Fair Labor Division inspectors, one administrative assistant, one
paralegal and six support staff.

During Fiscal Year 2002, the Western Massachusetts Division staff included Janice Healy, Division
Chief; Michelle Aube; James Clark; Susan Decker; Joseph Drzyzga; Robyn Gay; John Gibbons; Sandra
Giordano; Shirley Gouvan; Bart Hollander; Timothy Jones; Karen Kapusta; Michael Konderwicz; Kelli
Lawrence; Susan Midura; Tom Nartowicz; William O'Neill; Robert Ritchie; Laurie Rowan; Amy Royal;
Michael Russo; Palmer Santucci; Matthew Shea; Cynthia Sherman-Black; Maria Smith; Steven Spencer;
Christopher Speranzo; Richard Steward; John Talbot; Rosemary Tarantino; Theresa Ukleja; Eva Wanat;
Mark Weiner; James Whitcomb; and Judy Zeprun Kalman.

SIGNIFICANT CASE SUMMARIES

The following provides an overview of cases undertaken by the Western Massachusetts Division
during Fiscal Year 2002.

237

REGIONAL OFFICES

WESTERN MASSACHUSETTS DIVISION

BUSINESS AND LABOR PROTECTION BUREAU

• Environmental Enterprises & Associates. Inc . This company performs asbestos removal
on projects all over the state. It is located in Norwell. An audit of their work at Greenfield
Community College found that they did not pay the prevailing wage to 26 workers. A citation
was issued on August 14, 2001 . The employer failed to pay or appeal within the allowed period
and was debarred for one year. Eventually, the employer paid restitution of over $4,800.00 and
a fine of $850.

• Carroll's Market Carroll's is a market in Miller's Falls. A two-year audit showed violations
of the Sunday and Holiday premium pay laws. Carroll's signed a settlement agreement and paid
$10,000.

• J.D. Rivet This medium sized roofing company does a large volume of Prevailing Wage
work in Western Massachusetts. At the Nessacus Middle School in Dalton, they used seven
apprentices without proper supervisory ratios during their work in the summer of 2000. They
received a citation and paid $5,137.87 restitution and the $320 fine.

STATISTICAL SUMMARY

NON-PAYMENT OF WAGES AND PREVAILING WAGE MONIES

COMBINED

RESTITUTION

CASES

QUARTER

& PENALTIES/FINES

OPENED

CLOSED

CALLS*

1st

$22,598

187

234

3,038

2nd

$43,468

146

197

3,190

3rd

$37,359

134

172

1,803

4th

$53,712

210

184

2,372

TOTALS $157,137 677

"Walk-ins not tracked during Fiscal Year 2002

787

10,403

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REGIONAL OFFICES WESTERN MASSACHUSETTS DIVISION

INSURANCE AND UNEMPLOYMENT FRAUD

• Commonwealth v. Armand Arce (Springfield District Court) Armand Arce was a former
East Longmeadow insurance agent who pleaded guilty on August 28, 2001 to one count of
broker embezzlement and one count of Larceny Over $250. He was sentenced to sixty days in
the House of Correction, suspended for two years with probation. He was ordered to pay
$5,550.50 in restitution. The thefts involved two former insurance clients Arce represented
through his own company, Money Management in East Longmeadow. In 1996, the clients paid
Arce to buy new policies on their behalf. Instead of using the money to buy the policies, Arce
deposited the money into his business account for his own use.

• Commonwealth v. Robin Hayward (Springfield District Court) Robin Hayward, of
Springfield, Massachusetts, pleaded guilty in Springfield District Court on February 20, 2002,
to one count of workers' compensation fraud and one count of Larceny Over $250. She received
a sentence of nine months in the House of Correction, suspended for three years with probation.
She was ordered to pay $ 1 1 ,849 in restitution. In 1986, Hayward was injured while working for
Baystate Medical Center in Springfield. While collecting workers' compensation benefits for
that injury, Hayward failed to report that she was working full-time for Hampshire Eye and Ear
in Northampton.

• Commonwealth v. Andrew Budz (Pittsfield District Court) Andrew Budz, a dentist in
Williamstown, Massachusetts, admitted to sufficient facts on August 16, 2001 to one count of
larceny over $250 and one count of insurance fraud. The matter was continued without a finding
for a period of a year, and the defendant was ordered to pay $3,000.00 in court costs and restitution.
The amount of the restitution was $2,540.07.

The facts established that Dr. Budz filed a false claim relating to two pieces of dental equipment
which he alleged had been damaged as the result of a sewer backup in 1998.

STATISTICAL SUMMARY

INSURANCE AND UNEMPLOYMENT FRAUD DIVISION STATISTICS

Restitution $44,826

Fines $3,000

239

REGIONAL OFFICES WESTERN MASSACHUSETTS DIVISION

CRIMINAL BUREAU

• Commonwealth v. Redfern This matter relating to the improper storage of firearms by the
Chief of Police in Easthampton was referred to the Attorney General's Office by the Northwestern
District Attorney's Office. In July of 200 1 , Easthampton Police Officers responded to the home
of Chief Robert Redfern regarding a report that while the Police Chief was on vacation, his
teenage daughter had invited several friends to the house who had stolen the Chief's police cruiser
and accessed a firearm. While at Chief Redfern's home, police discovered 27 firearms at the
home that had not been properly secured in a locked container or with a trigger lock. Complaints
were brought against the Chief in Northampton District Court, and on February 1 , 2002, Chief
Redfern admitted to facts sufficient to warrant a guilty finding on 27 counts of illegally storing a
firearm. The Court continued the case without a finding for one year and assessed Chief Redfern
$ 1 ,000 in court costs.

• Commonwealth v. Lewis Through an undercover investigation conducted by AGO State
Police Sgt. John Gibbons, Tehran Lewis was identified as a supplier of large amounts of crack
cocaine in the Chicopee and Springfield areas. Lewis was indicted in September of 2001 for
multiple counts of trafficking cocaine. Following a trial in the Hampden Superior Court, Lewis
was found guilty on all counts, as charged. He was sentenced to ten years in State Prison.

GOVERNMENT BUREAU

• Lynch v. Commonwealth This case involved an appeal by the Commonwealth from a
decision of the Hampden Superior Court which ordered the Commonwealth to provide the
plaintiffs, as former employees of the abolished Hampden County, with comprehensive dental
insurance. The Appeals Court reversed the Superior Court decision and held that the statute
which abolished Hampden County does not require the Commonwealth to provide county
retirees with comprehensive dental insurance.

• Carmen Quinones v. Department of Social Services (Hampden Superior Court) This
G.L. c. 258 complaint asserted claims in negligence against the Department of Social Services
and individual claims against DSS, as well as claims of intentional infliction of emotional distress,
false imprisonment and civil rights violations. All claims arose out of an alleged mis diagnosis of
sexual abuse by an emergency room physician and the resulting removal of the Plaintiff's children
from her custody. The plaintiff asserted that the Commonwealth had permitted an unreasonable

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retention of the children in foster care and also alleged that two of the children were injured while
in foster care. The plaintiff's initial demand was $70,000 and reduced to $22,500 before the
trial. Following trial, the jury returned a verdict in favor of DSS and individually named DSS
supervisor on all counts of the plaintiff's complaint.

• Douglas Welenc. by Douglas and Susan Welenc v. Greenfield Public Schools and
Massachusetts Department of Education (Bureau of Special Education Appeals) (Franklin
Superior Court) In this tort case, the parents of a minor sought reimbursement for their private
educational placement of their child, insofar as they felt the Individual Education Plan (IEP)
prepared by the co-defendant, Greenfield Public Schools, was insufficient for their child's special
education needs. The BSEA had determined that the IEP was appropriate under the state and
federal guidelines. The plaintiffs' last demand for settlement was for payment/reimbursement in
the amount of $40,000.00 for their private school placement. Following a hearing on cross
motions for summary judgment, the Superior Court granted summary judgment in favor of the
state defendants.

• Prudance and Robert Duzan v. University of Massachusetts at Amherst (Hampshire
Superior Court) This was a tort claim arising as a result of a slip and fall in an icy parking lot at
the Mullins Center (arena) at UM ASS- Amherst. The plaintiff had incurred more than $ 1 6,000.00
in medical specials, and her spouse asserted a loss of consortium claim. Plaintiff's demand for
the two claims was $85,000. Following mediation, settlement was achieved for all claims in the
total amount of $15,000.

• Laliberte v. Department of Mental Retardation (DMR) (Hampden Superior Court) In
this motor vehicle tort claim, the Plaintiff asserted that she was severely injured in an automobile
accident wherein she was struck by a car being driven by an employee of DMR. The complaint
alleged that the driver failed to drive appropriately for the icy road conditions and was unable to
stop without rear-ending her vehicle. The plaintiff's initial demand for five separate claims was
$500,000. Three of the claims were dismissed. The case was ultimately settled for $45,000.00.

• Robert Samble v. Massachusetts Highway Department (Hampden Superior Court) This
nuisance action arose out of a claim by a riverfront landowner that dredging and other activities
undertaken in connection with the construction of Interstate 9 1 in the 1 9 50's had altered the bed
of the Connecticut River in such a way as to cause silt to accumulate on his property. The
Superior Court determined that he would be unable to prove his allegations at trial and entered
summary judgment in favor of the Massachusetts Highway Department and the Town of
Longmeadow.

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• David L. Krutiak and Karen Krutlak v. Department of Highways (Berkshire Superior
Court) This eminent domain action arose out of the acquisition of two acres of industrial
property in Adams, MA. The plaintiffs demand was $872,500 and they were awarded $ 16 1 ,000
at trial and appealed that verdict to the Appeals Court, claiming that the trial judge had improperly
admitted certain evidence and improperly excluded other evidence. The Appeals Court affirmed
thejudgment.

• Geraldlne Gardiner v. Division of Banks (Hampden Superior Court) In this employment
discrimination action, plaintiff claimed that she was denied a promotion to Bank Examiner IV
based on age and race. Plaintiff's demand was $100,000 and an offer of $15,000 was rejected.
Following trial, a jury verdict was returned in favor of the Commonwealth.

PUBLIC PROTECTION BUREAU

• Commonwealth and Shauna Lynn v. Richard Kowalskl and Columbia Delta Company

(Housing Court - Western Division) In this housing discrimination action filed by the
Commonwealth on behalf of Shauna Lynn, a single mother with two young children, it was
alleged that the defendants made discriminatory statements indicating a preference against renting
to a family with children, imposed different terms and conditions on the tenancy because young
children shared the rental premises and retaliated against Ms. Lynn by initiating eviction proceedings
against her when she complained about the discriminatory practices. Following mediation, the
case was settied for $25,000 and a consent decree containing prohibitory and injunctive relief was
signed by the defendants and approved by the Housing Court.

STATISTICAL SUMMARY

As of June 30, 2002, excluding matters being handled by the FLBP Division, there were a total of
268 cases pending in the Western Massachusetts Division.

During Fiscal Year 2002, 72 new civil defensive cases were assigned and 35 affirmative cases were
assigned. In addition, one new case was assigned to a special assistant attorney general and a WMAS
assistant attorney general was assigned to supervise the litigation and handling of that case.

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The defensive litigation cases were assigned in the following categories:
Administrative Law 24

Torts 17

Civil Rights/Employment Discrimination 8

Declaratory Judgment 3

Eminent Domain 4

Miscellaneous 1 6

TOTAL 72

The affirmative litigation cases were assigned in the following categories:
Criminal 1 5

Sexual Offender Registry Board 1

Consumer 1

Insurance and Unemployment Fraud 7

Civil Rights 2

TOTAL 35

In addition, there were 1 3 criminal investigations brought in Western Massachusetts. The Western
Mass. Consumer Liaison received 457 written consumer complaints and fielded 416 telephone complaints.
WMAS division staff fielded 2,200 consumer calls.

During Fiscal Year 2002, 99 cases were closed by division staff. Total dollars saved the Commonwealth
on civil defensive litigation cases were $790,000.00. Total dollars returned to consumers were $ 1 ,740.00.

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SIGNIFICANT INITIATIVES, EFFORTS AND ACTIVITIES

In January 2002, the Western Mass. Division relocated its offices to 1350 Main Street in Springfield,
thereby fulfilling Attorney General Reilly's long-standing commitment to integrate the staff of the Western
Massachusetts Fair Labor Business Practices Division, who had been operating from a separate and
substandard location, into the offices of the Western Mass. Division.

As a result of having a fully integrated office in Western Massachusetts the Attorney General is able to
more effectively meet the needs of the public and deliver a full array of legal services to both the agencies
and individuals throughout Western Massachusetts.

Civil Defensive Litigation The Western Mass. Division continued to provide the highest quality of
legal representation to agencies and individual state employees required to respond to litigation filed by
members of the public. During Fiscal Year 2002, there were 225 civil defensive litigation matters active
in the division. Successful resolution of many of these matters during Fiscal Year 2002 resulted in a
savings of $790,000 for the Commonwealth.

Civil Rights Division The Attorney General's Western Mass. Division continued to meet its statutory
responsibilities to affirmatively prosecute housing discrimination actions throughout Western Massachusetts.
However, due to a staffing shortage, in order to meet this responsibility, it was necessary to assign a
defensive litigation assistant attorney general to handle these matters. Additionally, during Fiscal Year
2002, a collaborative training program was developed with Western New England Law School's Civil
Rights Clinic in which law students were assigned to assist WMA Division staff in the handling of
housing discrimination cases.

During Fiscal Year 2002, the Western Mass. Division also continued with its efforts to assist schools
throughout the region in ensuring that students' civil rights are protected. To that end, division staff
participated in numerous outreach and training efforts designed to educate school personnel at all levels
regarding the key components of a comprehensive student civil rights policy, along with more specific
trainings focusing on the prevention of bullying, harassment, hate crimes, and civil rights violations.

Consumer Division Due to fiscal constraints, the division's ability to initiate affirmative litigation on
behalf of consumers in Western Massachusetts was limited. Being able to effectively respond to consumer
complaints is one of the highest priorities of the Attorney General and the Western Mass. Division.
Through the efforts of our division's consumer liaison, as well as the efforts of our civil investigative staff,
and local consumer protection programs which are funded through the Attorney General's Office, the
needs of consumers throughout the region were effectively met. Additionally, our division continued to

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advance the Attorney General's priorities in the area of elder protection through cross-bureau outreach
and education programs, including sponsoring an elder protection conference designed to educate senior
and elder protection providers regarding scams, fraud, and abuse.

OUTREACH, EDUCATION, AND TRAINING

During Fiscal Year 2002, staff in the WMAS regional office were actively engaged in advancing
numerous cross-bureau initiatives and trainings. Division staff continued their commitment to the
Attorney General's child protection priorities through their participation in the Attorney General's School
Safety Task Force, and on the local level, by volunteering with the Springfield Schools Volunteer Program.
Additionally, division staff played an active role in assisting the Springfield School System with the
implementation of its student civil rights policy by conducting numerous civil rights training programs
for school personnel. The division chief, as well as the deputy division chief, four assistant attorneys
general, and six support staff participated in a variety of programs, including the Read- Aloud Program,
Tutoring Programs, the Living Historian Program, and the Kids- Voting Program. Two division assistant
attorneys general conducted Internet Safety Training programs to over five hundred school students.
WMAS staff also participated at the local level in the Attorney General's Office Holiday Toy and Food
Drive by coordinating a clothing and food drive, as well as a holiday toy drive to benefit ARCH, the
Y VVCA's domestic violence shelter program. Additionally, addressing the needs of elder consumers was
designated a priority of the Public Protection Bureau. Regional staff advanced this priority by conducting
numerous educational training programs for area seniors and elder service providers.

In order to foster communication and cooperation among local law enforcement agencies, staff
attended the monthly meetings of the WMAS Chiefs of Police Association. Increasing our connections
with local community groups was advanced through staff participation in the Springfield Violence
Prevention Task Force, the Big Brothers/Big Sisters Program, and the Peacemaker's Peer Mediation
Summit. Assistant attorneys general also actively fostered our Office's relationship with the local legal
community through participation in the Women's Bar Association, the Hampden County Bar Association,
and as panelists for legal programs at Western New England College School of Law. Additionally, staff
in the Municipal Law Unit continued to provide numerous training and educational programs for towns
and municipalities throughout Western Massachusetts.

Division staff also actively participated in numerous cross-bureau working groups, including the
Diversity Committee, the Web site Committee and the Professional Development Unit working group.

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Lastly, Western Massachusetts staff participated in numerous professional development training programs
presented by the Attorney General's Institute.

CENTRAL MASSACHUSETTS DIVISION

The Central Massachusetts Division ("CMAS") strives to be an office reflective of and responsive to
the needs of the Central Massachusetts community. CMAS staff continued to increase the Office's
visibility and accessibility to the region's constituents. CMAS focused on the Office's affirmative litigation
capacity and pursued affirmative litigation in the areas of Civil Rights, Consumer Protection, and Insurance
Fraud.

The CMAS Division during Fiscal Year 2002 included the following staff members'. Maria Hickey
Jacobson, Chief; Patricia Bopp; Margret Cooke; Robert Galvani; John Gatti, Jr.; James Gentile; Salvatore
Giorlandino; Karen Leary; Michael Mard; John O'Leary; Kristen (Dionisi) O'Rourke; Wendy Parsons;
David Resendes", and Denise Romero.

SIGNIFICANT CASE SUMMARIES

BUSINESS AND LABOR PROTECTION BUREAU

Highlights of the cases handled by John O'Leary of the Insurance Fraud Division in Fiscal Year 2002
are the following:

• Commonwealth v. Bryant (Worcester Superior Court) On December 18, 2001, after a six-
week trial, a 1 2-person jury returned guilty verdicts on all three indictments alleging Conspiracy
to Commit Larceny Over $250 against Michael Bryant, an attorney who was employed at the
former Worcester law firm of Ellis & Ellis. The indictments alleged that Bryant conspired with
the law firm's partners, James N. Ellis, Jr. and Nicholas J. Ellis; his client, Jay P. Rosenfield; and
Shrewsbury physician Dr. Mario Moretti to submit false statements to Liberty Mutual (and
National Grange) in the course of several motor vehicle insurance claims. On January 2, 2002,
Judge Bohn sentenced Bryant to two and one half years in the House of Correction, 1 2 months
to serve, and the balance suspended with supervised probation for five years. Bryant was ordered
to pay $15,000 to the Commonwealth as costs of prosecution.

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• Commonwealth v. Peter A. Nutile (Middlesex Superior Court). Defendant was scheduled
to stand trial in Middlesex Superior Court on June 4, 2002, for indictments alleging Workers'
Compensation Fraud, Larceny Over $250, Attempted Larceny Over $250, and Perjury (four
counts). The Commonwealth was prepared to introduce evidence that Defendant was working
full-time, and getting paid in his wife's name, for approximately 12 of the 22 months that he
collected Temporary Total Disability Benefits. The Commonwealth also was prepared to prove
the theft of approximately $22 ,000.00, in addition to the defendant's attempts to steal an additional
$25,000.00 via a lump-sum settlement of the claim with the insurance company. The
Commonwealth was also prepared to prove that the defendant committed perjury in his testimony
before the Grand Jury which indicted him. On the day before trial was scheduled to commence,
Defendant entered a change of plea on all seven indictments. Judge Hamlin accepted Defendant's
Guilty pleas. Defendant was sentenced to seven years probation on all matters, and sentenced to
six months home confinement on the bracelet program and ordered to pay $25,185.14 in
restitution to Granite State Insurance Company/AIGCS ($22,635. 14 in fraudulently obtained
benefits, plus $2,550.00 in investigative expenses).

GOVERNMENT BUREAU :

Highlights of the cases handled by Salvatore Giorlandino, Kristen ORourke and Maria Hickey
Jacobson of the Government Bureau's Trial Division in Fiscal Year 2002 are the following:

• Wojcik v. State Lottery Commission. State Treasurer O'Brien, et. al. (U.S. District Court
for D.Mass.). This is a federal civil rights suit arising out of the Lottery Commission's firing of
the plaintiff for misconduct in September 1999. The plaintiff alleged that he was wrongfully
terminated and sought reinstatement to his old job as well as compensatory damages. In June
2001 , the U.S. District Court (Young, CJ.) granted the defendants' motion for summary judgment.
The plaintiffs appealed. In May 2002, the U.S. Court of Appeals for the First Circuit heard the
appeal. In August 2002, the First Circuit affirmed the defendants' summary judgment award.
Wojcik v. Massachusetts State Lottery Commission, et. al. , 300 F.3d 92 (1 st Cir. 2002).

• Commonwealth v. Phillips (Suffolk Superior Court). The "Greedy Granny Case" is a civil
suit by the Commonwealth to recover nearly $1 million in pension overpayments made by the
State Treasury to a retired school teacher. In June 2001, the Court (Ball, J.) entered a judgment
for the Commonwealth for nearly $1 million. In December 2001, the Court (Volterra, J.)
ordered the defendants' attached assets (approximately $250,000.00 to $300,000.00) to be
transferred to the Commonwealth.

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• Strahan v. Durand (U.S. District Court, Boston). The Commonwealth settled this seven
year old federal Endangered Species Act case involving Northern Right Whales with the plaintiff-
intervenor Conservation Law Foundation in January 2002.

• Fisher v. State Police (Worcester Superior Court). This is a highly litigious "Whistle Blower"
case arising out of State Police disciplinary action taken against a State trooper for misconduct.
During fiscal year 2002, Assistant Attorneys Generals Jacobson and Giorlandino spent a great
amount of time seeking dismissal of the case, responding to the plaintiff's Amended Complaint
and responding to the plaintiff's discovery requests. Discovery is ongoing.

• Mobil Oil Exxon Corp. v. Massachusetts Highway Department (Middlesex Superior
Court) . This was an eminent domain taking of a vacant lot, which was once a gas station, located
along Route 20 in Sudbury. The plaintiff claimed damages of $375,000 - $430,000. The
Commonwealth's expert appraiser determined the plaintiff was entitled to damages of $128,000
- $172,000, depending on the likelihood of a zoning variance from the town of Sudbury. The
pro tanto amount was $29,800, and the case settled for $150,000 in new money including
interest.

• Davis v. Commonwealth (Middlesex Superior Court). This wrongful death action arose
from a jailhouse suicide. The Commonwealth's position was that the plaintiff failed to comply
with the presentment requirements under G.L. c. 258, § 4, and improperly named the following
defendants: Sheriff DiPaola, Superintendent Norton, and Doctor Oman, all Commonwealth
employees acting within the scope of their employment and therefore immune from suit pursuant
to G.L. c. 258, § 2. The defendants' motion for summary judgment was allowed (Gants, J.)
dismissing all claims against all defendants.

• Massachusetts Highway Department v. City of Boston. Boston Redevelopment Authority
and MDA Park LLC (Suffolk Superior Court) . Massachusetts Highway Department requested
consideration of this affirmative litigation to recover a parcel of land in Park Square, Boston,
which the Commonwealth claimed it owned based upon the interpretation of an old Order of
Taking. A complaint was drafted to recover the land and/or recoup money damages. However,
before the complaint was filed, there were negotiations which resulted in a settlement agreement
in May 2002. Among other things, the settlement provided that the Commonwealth be
compensated in the amount of $ 1 67,000.00 and the Commonwealth agreed to no longer assert
its claim of ownership to the subject property.

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• Kahanic v. DSS. et. al. (Worcester Superior Court) . This case was filed in September 200 1
and is a wrongful death and negligence action against the Department of Social Services (ADSS)
and a private foster care agency arising out of DSS' placement of an infant with private foster
parents. The child disappeared in November 1998 while in the foster parents' care (he has been
missing for more than three years), and his natural father, the plaintiff, contends that the child has
died even though the Probate Court has not declared him dead. (See related case of Santos v.
DSS below) This is a high publicity case.

• Santos v. Department of Social Services (Worcester Superior Court). This case was filed
in December 2001 by the natural mother of the missing child subject of the suit in Kahanic. In
August 2002, the Court (Sanders, J.) dismissed the suit against DSS for failure to comply with
the Massachusetts Tort Claims Act's presentment requirements. This is a high publicity case.

PUBLIC PROTECTION BUREAU:

Highlights of the cases handled by Margret Cooke with the assistance of Investigator Jim Gentile
of the Public Protection Bureau in Fiscal Year 2002 are the following:

• Commonwealth v. Great Lakes Camps. Inc. d/b/a Quabbin Camps. George Deren and
Charles Sub (Worcester Superior Court) . This affirmative litigation case involves approximately
50 families who paid between $4,000.00 and $8,000.00 for a specialized summer camp for
children with autism and asperger syndrome. The camp never opened. A complaint was filed
February 4, 2002. To date, Quabbin Camps has neither refunded the parents money nor
compensated the parents/consumers for any additional expenses incurred due to the camp's failure
to open. Discovery is set to close in January 2003.

• Commonwealth v. LeBlanc (Middlesex Superior Court). This is a Massachusetts Commission
Against Discrimination (MCAD) referral case in which the defendant landlord died during the
MCAD proceedings. The case arose out of discriminatory acts targeting the victim's race and
national origin. The case survived the defendant's death and service was made on the estate's
executor. The case settled in May 2002, with defendant's estate compensating the victim for
damages in the amount of $28,000.00. There was no need for injunctive relief - the estate did
not own or manage any other rental property and the landlord was deceased.

• Commonwealth v. Rolls Realty (Middlesex Superior Court). This MCAD referral
discrimination case was based on familial status and lead paint discrimination. Final Judgment

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by Consent was filed with the Court on January 25, 2002. Damages in the amount of $10,000.00
were paid to the complainant and extensive injunctive relief was agreed to by the defendants.

• Commonwealth v. Hunneman Company/Coldwell Banker and Milla Ivanova (Worcester
Superior Court). This was a housing discrimination case based on race. The real estate agent
refused to sell to an African-American family and instead sold the house to a white family. The
case settled in November 2001 with injunctive relief and $28,000.00 for victims.

STATISTICAL SUMMARY

DEFENSIVE LITIGATION

PRO TANTO SETTLED NEW

CASE AMOUNT DEMAND AMOUNT MONEY SAVED*

Jones v. MHD

$5,700

$84,000

$19,000

$65,000

Welford v. MHD

$120,000

$325,000

$50,000

$205,000-$275,000

LaFleur v. MHD

$5,700

$127,000**

$30,000

$97,000

Moore v. MHD

$2,625

$75,000**

$29,000

$46,000

Sjoberg v. MHD

$17,625

$130,000**

$45,000

$73,000

Mobil Oil v.

$375,000-

Commonwealth

$29,800

$403,000

$150,000

$250,000

Getrost v. MHD

$2,300

$56,000

$15,000

$23,000

Tebaldi v. MHD

Not Available

$65,280

$27,000

$29,000

Barrus v. MDC

$8,100

$53,000

$28,000

$40,000

Meadowland

No formal

Corp. v. MDC

taking

$75,000

$17,500

$60,000

TOTAL $410,500 $888,000-$958,000

Dollar amounts are approximate due to variations in calculating amounts.
* Exclusive of interest — approximately 14%.

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AFFIRMATIVE LITIGATION

Non-Payment of Wages and Prevailing Wage Monies Recovered

FISCAL YEAR 2002 RESTITUTION

1st Quarter $106,934.12

2nd Quarter $53,909.15

3rd Quarter $37,591.66

4th Quarter $8,761.84

TOTAL $207,196.77

Insurance and Unemployment Fraud Division

Restitution to Insurance Companies

(moneys defrauded plus investigative costs) $26,277. 14

Costs of Prosecution

(to be paid by the defendant to the Office of the Attorney General) $ 1 5,000

Trial Division

Massachusetts Highway Department v. City of Boston. Boston Redevelopment Authority, and
MDA Park LLC settlement compensated the Commonwealth in the amount of $167,000.

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Civil Rights

CASE COMPENSATION

Commonwealth v. LeBlanc $28,000

Commonwealth v. Rolls Realty $ 1 0,000

Commonwealth v. Hunneman $28,000

Commonwealth v. LivonTanakejian, Bessette,

Realty and Joanne Lyttle $5,000

TOTAL $71,000

The Commonwealth entered into a letter agreement with Branford Hall Career Institute, settling on
March 21, 2002, for $24,000 (eight victims at $3,000/each).

Telephone Calls and Walk-ins