September 27, 2021

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Government Intervenes in False Claims Act Lawsuits Against Kaiser Permanente Affiliates for Submitting Inaccurate Diagnosis Codes to the Medicare Advantage Program

6 min read
<div>The United States has intervened in six complaints alleging that members of the Kaiser Permanente consortium violated the False Claims Act by submitting inaccurate diagnosis codes for its Medicare Advantage Plan enrollees in order to receive higher reimbursements.</div>
The United States has intervened in six complaints alleging that members of the Kaiser Permanente consortium violated the False Claims Act by submitting inaccurate diagnosis codes for its Medicare Advantage Plan enrollees in order to receive higher reimbursements.

More from: July 30, 2021

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  • Federal Real Property: Additional Documentation of Decision Making Could Improve Transparency of New Disposal Process
    In U.S GAO News
    In 2016, the Federal Assets Sale and Transfer Act (FASTA) created the independent Public Buildings Reform Board (the Board) to support a new, three-round process for disposing of unneeded federal real property. The first of these rounds required the Board to identify and recommend at least five high-value disposal candidates with a total market value between $500 and $750 million. To identify these properties, the General Services Administration (GSA) collected and evaluated agency recommendations; a GSA-hired contractor analyzed real property data; and the Board held public hearings, visited properties, and met with federal officials. This process resulted in identifying 44 properties. The Board then took various steps to evaluate the 44 properties and recommended 12 final disposal candidates that the Office of Management and Budget (OMB) approved in January 2020. (See figure.) However, the Board did not fully document the process used to evaluate these candidates. For example, the Board's rationales for why individual candidates were or were not recommended were vague or incomplete. Full documentation on the decision-making process would better position stakeholders, including members of Congress, to understand the Board's rationales, especially for decisions with financial implications. Process Used by Stakeholders for Identifying and Recommending High-Value Federal Real Property for Potential Disposal Candidates According to Board and selected federal agency officials, FASTA made it easier for agencies to pursue high-value property disposals due, in part, to exemptions from some requirements, such as having to first offer properties to federal, state, or local agencies. However, FASTA's effect on other long-standing challenges, including funding to prepare properties for disposal, is unclear. For example, FASTA created a dedicated funding source to implement Board recommendations including those related to covering disposal costs, such as relocating agency staff. However, officials expressed concern that access to these funds is not automatic and must go through the annual appropriations process, which rarely coincides with the timing of these projects. The administration proposed legislative language to make proceeds from the sale of assets in fiscal year 2021 available without additional actions by Congress. However, as of January 2021, legislation containing the proposed language had not been enacted. This report discusses elements Congress may wish to evaluate when determining whether to grant such budget-related flexibility. GAO designated federal real property management, including the disposal of properties, as a high-risk area in 2003. FASTA included a provision for GAO to review the recommendations and selection processes such as those used in the first round of identifying and recommending high-value properties as candidates for disposal. This report examines: (1) how stakeholders implemented FASTA to identify and evaluate high-value properties as potential disposal candidates and (2) stakeholder views on the extent to which FASTA helped agencies with the disposal of unneeded high-value properties and addressed long-standing challenges in disposing of federal properties. GAO reviewed FASTA and analyzed documents from the Board, OMB, GSA, and selected 14 federal agencies to examine the processes they used and the challenges they encountered under the FASTA process. Agencies were selected based on their recommendations of high-value properties and inclusion on the Board's final list, among other things. GAO also interviewed officials from the Board, OMB, GSA, and selected federal agencies. GAO is recommending that the Board fully document its process for recommending FASTA disposal candidates, including the rationales behind disposal decisions. The Board noted plans to develop more documentation of its future disposal decisions. For more information, contact David Trimble at (202) 512-2834 or trimbled@gao.gov.
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  • The United States Condemns the Kidnapping of Students in Kankara, Nigeria
    In Crime Control and Security News
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  • Judiciary Releases Annual Report and Judicial Business 2020
    In U.S Courts
    Along with the rest of America, the Judiciary confronted significant challenges in 2020, led by the need to meet its constitutional obligations amid a deadly global pandemic. Federal courts learned to keep operations going, despite restricted access to courth­ouses, with a quickly evolving reliance on technology and the resilience of a 30,000-strong workforce, according to the Annual Report of the Director Administrative Office of the U.S. Courts (AO).
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  • U.S.-Greenland Technical Engagement on Mining Sector Education and Training
    In Crime Control and Security News
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  • Washington Man Charged With COVID-Relief Fraud
    In Crime News
    A Washington man was charged in a criminal complaint unsealed today for fraudulently seeking over $1.1 million in COVID-19 relief guaranteed by the Small Business Administration (SBA) through the Economic Injury Disaster Loan (EIDL) and the Paycheck Protection Program (PPP) under the Coronavirus Aid, Relief and Economic Security (CARES) Act.
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  • Combating Wildlife Trafficking: Agencies Work to Address Human Rights Abuse Allegations in Overseas Conservation Programs
    In U.S GAO News
    U.S. agencies primarily use Leahy vetting as the enforcement mechanism to prevent U.S. funding for combating wildlife trafficking from supporting human rights abuses. Statutory provisions commonly referred to as "Leahy Laws" prohibit the U.S. government from using certain funds to assist units of foreign security forces where there is credible information they have committed a gross violation of human rights. The Department of State (State) and the U.S. Agency for International Development (USAID) generally consider park rangers to be foreign security forces that are authorized to search, detain, arrest, or use force against people, and thus subject to Leahy vetting, according to agency officials. State or USAID may provide funding to the Department of the Interior's Fish and Wildlife Service (FWS) that it then uses to support park ranger activities. In those instances, FWS submits the candidates' applications to State for Leahy vetting. According to a State official, Leahy approval of a security force unit is good for 1 year, and State must vet individuals again if their unit continues to receive support from State or USAID funding sources. Both U.S. agencies and implementing partners took a variety of steps in response to recent allegations of human rights abuses by overseas park rangers. For example, a State official in the Central Africa region told GAO that while the Democratic Republic of the Congo embassy's vetting program has very strict control mechanisms, the International Narcotics and Law Enforcement Affairs Bureau requested quarterly reports to facilitate a review of all assistance to park rangers to ensure that any reported activities were vetted according to Leahy Laws. USAID officials told GAO that in addition to continuing Leahy vetting, the agency's response included strengthening human rights training and conducting a site visit to a park in the DRC where human rights abuses had allegedly occurred. According to officials, the visit involved speaking with beneficiaries to further understand the allegations and efforts to assess root causes, mitigate impacts, and stop future occurrences, including making referrals to appropriate law enforcement authorities if warranted. FWS officials also stated that they take seriously allegations that U.S implementing partners have supported park rangers who have committed human rights abuses. Since June 2019, the Department of the Interior has approved no new awards to the World Wildlife Fund (WWF)—one of the implementing partners which has supported park rangers alleged to have committed human rights abuses. Moreover, the International Affairs program within FWS has put all new funding on hold since September 2019, pending a departmental review. Agencies are also implementing various changes in response to congressional directives on safeguarding human rights. For example, State officials told GAO that they have added language to all notices for countering wildlife trafficking awards that requires implementing partners to include social safeguards plans in their projects. The plans will articulate an understanding of how their work could negatively affect local communities. USAID officials stated that USAID has included provisions in new agreements with FWS that require adherence to the congressional directives. FWS officials also confirmed that they are cooperating with USAID in these efforts. Implementing partners—WWF, the Wildlife Conservation Society (WCS), and African Parks (AP)—have all conducted investigations to address allegations of human rights abuses by park rangers, according to officials from these organizations. They have also developed grievance mechanisms to report human rights abuses. For example, WWF has received 50 complaints in roughly the past year related to its project work, according to WWF representatives. WWF has responded to complaints of human rights abuses through this mechanism by reporting the allegations to relevant authorities and meeting with community representatives. U.S. agencies provide training and equipment for park rangers overseas to combat wildlife trafficking. From fiscal years 2014 through 2020, the U.S. government provided approximately $554 million to undertake a range of activities through federal agencies and in cooperation with implementing partner organizations in the field. Multiple non-governmental organization and media reports, however, have alleged that organizations that have received U.S. funds have supported park rangers engaged in combating wildfire trafficking who have committed human rights violations since the mid-2000s. GAO was asked to review human rights protection mechanisms related to U.S. efforts to combat wildlife trafficking. This report examines 1) what enforcement mechanisms agencies have to prevent U.S. funded efforts to combat wildlife trafficking from supporting human rights abuses and how they implement them, and 2) how agencies and implementing partners address allegations of human rights abuses. GAO spoke with agency officials and implementing partner representatives locally in person and overseas by phone, and collected and analyzed information related to program implementation. For more information, contact Kimberly Gianopoulos at (202) 512-8612 or gianopoulosk@gao.gov.
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  • CEO of Multibillion-dollar Software Company Indicted for Decades-long Tax Evasion and Wire Fraud Schemes
    In Crime News
    A federal grand jury in San Francisco, California, returned a 39 count indictment charging Robert T. Brockman, the Chief Executive Officer of an Ohio-based software company, with tax evasion, wire fraud, money laundering, and other offenses, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Tax Division, U.S. Attorney David L. Anderson for the Northern District of California, and Chief of Internal Revenue Service (IRS) Criminal Investigation Jim Lee. The charges stem from an alleged decades-long scheme to conceal approximately $2 billion in income from the IRS as well as a scheme to defraud investors in the software company’s debt securities.
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  • Burmese Military Arrests of Civilian Government Leaders
    In Crime Control and Security News
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  • U.S.-China Trade: USTR Should Fully Document Internal Procedures for Making Tariff Exclusion and Extension Decisions
    In U.S GAO News
    What GAO Found The Office of the U.S. Trade Representative (USTR) developed a process in July 2018 to review tariff exclusion requests for some imported products from China and later developed a process to extend these exclusions. From 2018 to 2020, U.S. stakeholders submitted about 53,000 exclusion requests to USTR for specific products covered by the tariffs. USTR's process consisted of a public comment period to submit requests, an internal review, an interagency assessment, and the decision publication. USTR documented some procedures for reviewing exclusion requests. However, it did not fully document all of its internal procedures, including roles and responsibilities for each step in its review process. GAO reviewed selected exclusion case files and found inconsistencies in the agency's reviews. For example, USTR did not document how reviewers should consider multiple requests from the same company, and GAO's case file review found USTR performed these steps inconsistently. Another case file lacked documentation to explain USTR's final decision because the agency's procedures did not specify whether such documentation was required. Federal internal control standards state that agencies should document their procedures to ensure they conduct them consistently and effectively, and to retain knowledge. Without fully documented internal procedures, USTR lacks reasonable assurance it conducted its reviews consistently. Moreover, documenting them will help USTR to administer any future exclusions and extensions. USTR evaluated each exclusion request on a case-by-case basis using several factors, including product availability outside of China and the potential economic harm of the tariffs. According to USTR officials, no one factor was essential to grant or deny a request. For example, USTR might grant a request that demonstrated the tariffs would cause severe economic harm even when the requested product was available outside of China. USTR denied about 46,000 requests (87 percent), primarily for the failure to show that the tariffs would cause severe economic harm to the requesters or other U.S. interests (see figure). Further, USTR did not extend 75 percent of the tariff exclusions it had granted. USTR's Primary Reasons for Denying Exclusion Requests for Section 301 Tariffs on Products from China, 2018-2020 Note: Totals may not sum due to rounding. Why GAO Did This Study In July 2018, USTR placed tariffs on certain products from China in response to an investigation that found certain trade acts, policies, and practices of China were unreasonable or discriminatory, and burden or restrict U.S. commerce. As of December 2020, the U.S. imposed tariffs on roughly $460 billion worth of Chinese imports under Section 301 of the Trade Act of 1974, as amended. Because these tariffs could harm U.S. workers and manufacturers that rely on these imports, USTR developed a process to exclude some products from these additional tariffs. U.S. businesses and members of Congress have raised questions about the transparency and fairness of USTR's administration of this process. GAO was asked to review USTR's tariff exclusion program. This report (1) examines the processes USTR used to review Section 301 tariff exclusion requests and extensions and (2) describes how USTR evaluated those tariff exclusion requests and extensions, and the outcomes of its decisions. GAO analyzed USTR's public and internal documents relating to the exclusion and extension processes, including 16 randomly selected nongeneralizable case files, and data from USTR and the U.S. Census Bureau. GAO also interviewed agency officials.
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  • Secretary Antony J. Blinken Before Virtual Meeting with Nigerian President Muhammadu Buhari and Foreign Minister Geoffrey Onyeama
    In Crime Control and Security News
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  • Priority Open Recommendations: Office of Management and Budget
    In U.S GAO News
    What GAO Found In April 2020, GAO identified 35 priority recommendations for the Office of Management and Budget (OMB). Since then, OMB has implemented four of those recommendations by, among other things, taking actions to help reduce improper payments across the federal government and improve the quality of agency spending data. In June 2021, GAO identified 13 additional priority recommendations for OMB, bringing the total number to 44. These recommendations involve the following areas: Improving government performance. Increasing availability and transparency of government data. Improving acquisition management and reducing costs. Reducing government-wide improper payments. Strengthening information security. Establishing controls for disaster relief. Improving oversight of agency collection and coordination of federal data on sexual violence. Improving federal real property asset management. Improving information management. OMB's continued attention to these issues could yield significant cost savings and other improvements in government operations. Why GAO Did This Study Priority open recommendations are the GAO recommendations that warrant priority attention from heads of key departments or agencies because their implementation could save large amounts of money; improve congressional and/or executive branch decision-making on major issues; eliminate mismanagement, fraud, and abuse; or ensure that programs comply with laws and funds are legally spent, among other benefits. Since 2015 GAO has sent letters to selected agencies to highlight the importance of implementing such recommendations. For more information, contact Michelle Sager at (202) 512-6806 or sagerm@gao.gov.
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  • Agricultural Developer Agrees to Pay Clean Water Act Fines, Mitigate Impacts to Sensitive Streams and Wetlands
    In Crime News
    A California agricultural developer has agreed to pay a civil penalty, preserve streams and wetlands, effect mitigation, and be subject to a prohibitory injunction to resolve alleged violations of the Clean Water Act (CWA) on property near the Sacramento River located in Tehama County, California, the Justice Department announced today.
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  • Foreign Assistance: The United States Provides Wide-ranging Trade Capacity Building Assistance, but Better Reporting and Evaluation Are Needed
    In U.S GAO News
    From 2005 to 2010, 24 U.S. agencies provided more than $9 billion in trade capacity building (TCB) assistance to help more than 100 countries reduce poverty, increase economic growth, and achieve stability through trade. To report on TCB funding, the U.S. government conducts an annual survey of agencies and publicly reports the data in a TCB database administered by the U.S. Agency for International Development (USAID). GAO examined (1) how agencies' TCB activities are aligned with the agencies' goals, (2) the extent to which the TCB database provides sufficient information on key trends and funding, and (3) the extent to which USAID monitors and evaluates the effectiveness of its TCB activities. GAO focused on the agencies that reported the most funding for TCB activities since 2005--the Departments of the Army and State, the Millennium Challenge Corporation (MCC), and USAID--and the Office of the U.S. Trade Representative (USTR). GAO analyzed U.S. government data; reviewed agencies' strategic, budget, and program documents; and met with U.S. and foreign government officials in select countries.USAID and State conduct TCB activities that are aligned with their primary goals, but TCB is secondary to the goals of other agencies. USAID and State have developed strategic plans that include TCB-focused goals. Aligned with these goals, USAID and State assist countries in negotiating and implementing trade agreements. In addition, USAID assists countries in taking advantage of economic growth opportunities stemming from trade, often in conjunction with other agency goals. TCB is not a primary focus of MCC and the Army, however, they conduct activities to meet their broader agency goals that have trade-related effects. MCC identifies trade-related assistance it considers TCB as part of its programs' poverty reduction goals. The Army implements TCB-related physical infrastructure projects as part of its disaster response objectives and in support of its reconstruction and economic development efforts in Iraq and Afghanistan. The U.S. government TCB database has reported that annual TCB funding has increased from $1.35 billion in 2005 to $1.69 billion in 2010, but the database does not adequately describe certain factors underlying this growth and other significant changes in the composition of TCB funding. From 2005 to 2010, two agencies--MCC and the Army--began reporting significant TCB funding, primarily for physical infrastructure projects. Their funding comprised 54 percent of total TCB, and physical infrastructure projects comprised 45 percent of total TCB. However, the TCB database does not adequately explain significant factors driving changes in the composition of TCB funding. In particular, the annual TCB survey methodology attempts to identify and quantify just the trade-related components of projects, but this can be difficult in practice, particularly for physical infrastructure projects. Although GAO found the survey data to be generally reliable, these factors can lead to limitations in the data that are not described for its users. Clear reporting and transparent methodology and data collection are essential to understanding levels of funding and changes in the nature of TCB over time. USAID has improved its assessment of TCB activities, including developing performance indicators and taking the positive step of commissioning a multicountry evaluation of the effects of TCB, but it has yet to develop plans to make use of the evaluation's valuable insights. USAID uses trade and investment indicators to assess the immediate results of its TCB activities. However, officials explained that it is difficult to attribute trade-related trends revealed by the indicators to the effects of TCB assistance and collect valid and reliable data to measure progress. To assess longer-term results, USAID has commissioned evaluations of TCB programs in specific countries, but these are limited in number. It recently commissioned a multicountry evaluation of the long-term effectiveness of its TCB activities agencywide. While USAID is beginning to incorporate the evaluation's results in its training, it has yet to develop plans for disseminating best practices to missions and offices on the methods they may use to better manage and assess their activities. Furthermore, it has not made plans for conducting evaluations on an ongoing basis. GAO recommends that the Administrator of USAID publicly report identified limitations and key distinctions in the categories of TCB assistance in the database. GAO also recommends that USAID develop a written plan for using its recent TCB evaluation and for conducting evaluations on an ongoing basis. USAID stated that it has already taken steps consistent with the GAO recommendations.
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  • COVID-19 Loans: SBA Has Begun to Take Steps to Improve Oversight and Fraud Risk Management
    In U.S GAO News
    What GAO Found In April 2020, the Small Business Administration (SBA) quickly implemented the Paycheck Protection Program (PPP) and expedited the processing of Economic Injury Disaster Loans (EIDL) and a new EIDL advance program. These important programs have helped businesses survive during the COVID-19 pandemic. In an effort to move quickly on these programs, SBA initially put limited internal controls in place, leaving both susceptible to program integrity issues, improper payments, and fraud. Because of concerns about program integrity, GAO added PPP and the EIDL program onto its High-Risk List in March 2021. SBA has begun to take steps to address these initial deficiencies: PPP oversight. Because ongoing oversight is crucial, GAO recommended in June 2020 that SBA develop plans to respond to PPP risks to ensure program integrity, achieve program effectiveness, and address potential fraud. Since then, SBA has developed a loan review process and added up-front verifications before it approves new loans. Improper payments for PPP. GAO recommended in November 2020 that SBA expeditiously estimate improper payments for PPP and report estimates and error rates. SBA has now developed a plan for the testing needed to estimate improper payments. Analyzing EIDL data. Based on evidence of widespread potential fraud for EIDL, GAO recommended in January 2021 that SBA conduct portfolio-level analysis to detect potentially ineligible applications. SBA has not announced plans to implement this recommendation. EIDL oversight. GAO recommended in March 2021 that SBA implement a comprehensive oversight plan for EIDL to ensure program integrity. SBA agreed to implement such a plan. Assessment of fraud risks. SBA has not conducted a formal fraud risk assessment for PPP or the EIDL program. GAO made four recommendations in March 2021, including that SBA conduct a formal assessment and develop a strategy to manage fraud risks for each program. SBA said it would work to complete fraud risk assessments for PPP and EIDL and continually monitor fraud risks. Financial statement audit. In December 2020, SBA's independent financial statement auditor issued a disclaimer of opinion on SBA's fiscal year 2020 consolidated financial statements because SBA could not provide adequate documentation to support a significant number of transactions and account balances related to PPP and EIDL. GAO continues to review information SBA recently provided, including data on PPP loan forgiveness and details on the PPP and EIDL loan review processes. In addition, GAO has obtained additional information from a survey of PPP participating lenders, interviews with SBA's PPP contractors, and written responses to questions provided by SBA's EIDL contractor and subcontractors. Why GAO Did This Study SBA has made or guaranteed about 18.7 million loans and grants through PPP and the EIDL program, providing about $968 billion to help small businesses adversely affected by COVID-19. PPP provides potentially forgivable loans to small businesses, and EIDL provides low-interest loans of up to $2 million for operating and other expenses, as well as advances (grants). This testimony discusses the lack of controls in PPP and the EIDL program and SBA's efforts to improve its oversight of these programs. It is based largely on GAO's June 2020–March 2021 reports on the federal response, including by SBA, to the economic downturn caused by COVID-19 (GAO-20-625, GAO-20-701, GAO-21-191, GAO-21-265, GAO -21-387). For those reports, GAO reviewed SBA documentation and SBA Office of Inspector General (OIG) reports; analyzed SBA data; and interviewed officials from SBA, the SBA OIG, and the Department of the Treasury.
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  • Department of Justice Files Statement of Interest Supporting Capitol Hill Baptist Church’s Efforts to Practice its Faith During COVID-19
    In Crime News
    The Justice Department today filed a statement of interest in federal district court in Washington, D.C., arguing the Constitution and federal law require the District of Columbia to accommodate Capitol Hill Baptist Church’s effort to hold worship services outdoors, at least to the same extent the District of Columbia allows other forms of outdoor First Amendment activity, such as peaceful protests.
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  • Secretary Blinken’s Meeting with Jordanian King Abdullah II
    In Crime Control and Security News
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  • Health Care Company Indicted for Labor Market Collusion
    In Crime News
    A federal grand jury returned a two-count indictment charging Surgical Care Affiliates LLC and its related entity (collectively SCA), which own and operate outpatient medical care centers across the country, for agreeing with competitors not to solicit senior-level employees, the Department of Justice announced today. These are the Antitrust Division’s first charges in this ongoing investigation into employee allocation agreements.
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  • Ohio Man Indicted for Threatening a Local Reproductive Health Services Facility
    In Crime News
    A federal grand jury in Columbus, Ohio, returned an indictment charging an Ohio man for threatening a reproductive health services facility.
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  • Taiwan Company Pleads Guilty to Trade Secret Theft in Criminal Case Involving PRC State-Owned Company
    In Crime News
    The Department of Justice today announced that United Microelectronics Corporation, Inc. (UMC), a Taiwan semiconductor foundry, pleaded guilty to criminal trade secret theft and was sentenced to pay a $60 million fine, in exchange for its agreement to cooperate with the government in the investigation and prosecution of its co-defendant, a Chinese state-owned-enterprise.
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  • Georgia Man Pleads Guilty as a Result of Multi-State Dog Fighting, Drug Trafficking Investigation
    In Crime News
    A well-known dog-fighting trainer and breeder has pleaded guilty to a federal animal fighting charge as the result of an ongoing investigation into a significant multi-state dog fighting and drug trafficking ring.
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