Pennsylvania Attorney Sentenced for Role in $2.7 Million Ponzi Scheme

An Allentown, Pennsylvania, attorney was sentenced today to 78 months in prison followed by three years of supervised release for his role in a $2.7 million investment fraud scheme that victimized his law clients.  

Acting Assistant Attorney General Brian Rabbitt of the Justice Department’s Criminal Division, U.S. Attorney William M. McSwain of the Eastern District of Pennsylvania and Special Agent in Charge Michael J. Driscoll of the FBI’s Philadelphia Field Office made the announcement.

Todd H. Lahr, 60, of Nazareth, Pennsylvania, was sentenced by U.S. District Judge Edward G. Smith of the Eastern District of Pennsylvania who also ordered Lahr to pay $2,106,918.60 in restitution and $273,091 in forfeiture.

Lahr, an attorney licensed to practice law in Pennsylvania and the District of Columbia, and with offices in Allentown, pleaded guilty in April 2020 to one count of conspiracy to commit securities fraud and wire fraud, two counts of securities fraud, and four counts of wire fraud.

According to Lahr’s admissions at the plea hearing and sentencing, from 2012 through 2019, Lahr conspired with others to perpetrate a securities fraud scheme targeting his own law clients, which involved the fraudulent sale of the securities of two entities, THL Holdings LLC and Ferran Global Holdings Inc.

Lahr initially sold THL Holdings investments, promising that the money raised would be used to pursue specific business opportunities, including mining operations in Papua New Guinea and the acquisition of the shares of a penny stock.  In reality, the money was used for Lahr’s personal expenses and to make Ponzi scheme payments to prior investors, among other things. Once Lahr realized that he was running out of investor money to pay the THL Holdings investors, he sought investors for a second entity, Ferran.  He told the Ferran investors that their money would be used for business opportunities, including even more mining in Papua New Guinea and residential property leases in Spain and England—but, in fact, these funds were used to repay the prior THL Holdings investors and, again, for Lahr’s personal expenses to fund his lifestyle.  Among these personal expenses were his home mortgage, his child’s school tuition, utility bills, and other personal debt. Total investor losses are estimated to be over $2.7 million.

Even after he was caught, Lahr continued his deception by lying in sworn testimony before the U.S. Securities and Exchange Commission (SEC). In this testimony, Lahr denied writing checks to his personal accounts from the THL Holdings accounts, when, in fact, he had written at least 25 separate checks to himself over a three-year period.

The FBI investigated this case.  Trial Attorney Philip Trout of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Michael J. Rinaldi of the Eastern District of Pennsylvania are prosecuting the case.

The department appreciates the substantial assistance provided by the SEC.

The year 2020 marks the 150th anniversary of the Department of Justice.  Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.  

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    Since 2012, utilities have taken steps to improve grid resilience to severe hurricanes, such as (1) implementing storm hardening measures to enable the grid to better withstand the effects of hurricanes; (2) adopting technologies to enhance operational capacity and help quickly restore service following disruptions; and (3) participating in mutual aid programs with other utilities and training and planning exercises. For example, utilities have implemented storm hardening measures that include elevating facilities and constructing flood walls to protect against storm surges. Utilities have also adopted technologies that enhance communication capabilities and monitor systems to detect, locate, and repair sources of disruptions. However, these utilities reported challenges justifying grid resilience investments to obtain regulatory approval, and some utilities have limited resources to pursue such enhancements. Example of Hurricane Resilience Improvement: Elevated Substation Various federal agencies can provide funding for efforts to enhance grid resilience to hurricanes, including the Department of Agriculture (USDA) and the Federal Emergency Management Agency (FEMA). However, eligibility for most federal funding for grid resilience, including some USDA and FEMA funding, is limited to publicly owned utilities and state, tribal, and local governments. The Department of Energy (DOE) does not provide direct funding for grid resilience improvements, but it has efforts under way, including through its National Laboratories, to provide technical assistance and promote research and collaboration with utilities. DOE has also initiated preliminary efforts to develop tools for resilience planning, including resilience metrics and other tools such as a framework for planning, but DOE does not have a plan to guide these efforts. Without a plan to guide DOE efforts to develop tools for resilience planning, utilities may continue to face challenges justifying resilience investments. In addition, DOE lacks a formal mechanism to inform utilities about the efforts of its National Laboratories. Such a mechanism would help utilities leverage existing resources for improving grid resilience to hurricanes. Hurricanes pose significant threats to the electricity grid in some U.S. coastal areas and territories and are a leading cause of major power outages. In recent years, hurricanes have impacted millions of customers in these areas. Adoption of technologies and other measures could improve the resilience of the grid so that it is better able to withstand and rapidly recover from severe weather; this could help mitigate the effects of hurricanes. This report examines (1) measures utilities in selected states have adopted to enhance grid resilience following major hurricanes since 2012 and any challenges utilities face funding such measures; and (2) federal efforts to support the adoption of measures to enhance grid resilience to hurricanes and any opportunities that exist to improve these efforts. For this report, GAO assessed agency and industry actions; reviewed relevant reports, policies, and documents; and interviewed federal, industry, and local officials. GAO recommends that DOE (1) establish a plan to guide its efforts to develop tools for resilience planning, and (2) develop a mechanism to better inform utilities about grid resilience efforts at the National Laboratories. DOE agreed in principle with these recommendations, but its proposed actions do not fully address GAO's concerns. For more information, contact Frank Rusco at (202) 512-3841 or ruscof@gao.gov.
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  • Firefighting Foam Chemicals: DOD Is Investigating PFAS and Responding to Contamination, but Should Report More Cost Information
    In U.S GAO News
    What GAO Found The Department of Defense (DOD) is early in the environmental restoration process at or near the 687 installations with a known or suspected release of certain per- and polyfluoroalkyl substances (PFAS)—heat-resistant chemicals found in certain firefighting foams that can contaminate drinking water (see fig.). DOD Installations in the Environmental Restoration Process with a Known or Suspected PFAS Release, as of Fiscal Year 2020 aAccording to DOD officials, in fiscal year 2021 the Air Force changed its definition for when this phase is considered complete, resulting in a lower number of DOD installations (129 installations) that had completed this phase as of March 2021. DOD has taken actions (e.g., providing bottled water, installing water treatment systems) to address PFAS in drinking water at or near its installations when PFAS amounts exceeded federal health advisory levels. DOD generally has not taken actions to address PFAS in drinking water where PFAS amounts were below the federal advisory levels, but above state PFAS standards. DOD estimates that its future PFAS investigation and cleanup costs will total more than $2.1 billion beginning in fiscal year 2021, which is in addition to $1.1 billion in actual PFAS costs incurred through fiscal year 2020. These costs will likely increase significantly, because DOD is still in the early phases of its PFAS investigation. DOD officials also cited regulatory uncertainty at the federal and state levels as a significant challenge in estimating PFAS environmental restoration costs. However, DOD has not reported future PFAS cost estimates, or the scope and limitations of those estimates, in its annual environmental reports to Congress. By reporting this information to Congress, DOD would ensure that Congress has increased visibility into the significant costs and efforts associated with PFAS investigation and cleanup at or near military installations. As of March 2021, DOD had identified six potential PFAS-free foam candidates; however, PFAS-free foams have been unable to fully meet DOD's current performance requirements. By law, DOD must ensure that a PFAS-free firefighting alternative is available for use at its installations by October 2023. DOD is funding research to address challenges associated with identifying PFAS-free alternatives. DOD plans to continue using PFAS-containing foam aboard ships at sea—as allowed for by the National Defense Authorization Act for Fiscal Year 2020—until a PFAS-free alternative can meet existing requirements. Why GAO Did This Study DOD has long used PFAS-containing firefighting foam to extinguish fires quickly and keep them from reigniting. PFAS can migrate into the environment (e.g., drinking water) and may have adverse effects on human health. The federal government has issued two nonenforceable advisories but has not yet regulated PFAS in drinking water; some states have adopted PFAS regulations. Conference Report 116-333, accompanying the National Defense Authorization Act for Fiscal Year 2020, included a provision for GAO to review DOD's response to PFAS contamination. This report (1) describes DOD's progress in the investigation and cleanup of PFAS at its installations, and DOD's actions to address PFAS in drinking water; (2) describes DOD's actual and estimated costs for PFAS investigation and cleanup, and evaluates the extent to which DOD has reported those figures to Congress; and (3) describes DOD's progress in identifying PFAS-free firefighting alternatives. GAO analyzed DOD data on PFAS cleanup, costs (actual and estimated obligations), and foam alternatives; evaluated DOD's PFAS cost reporting against policy; and interviewed officials from DOD and selected installations and state environmental agencies.
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  • Retirement Security: Older Women Report Facing a Financially Uncertain Future
    In U.S GAO News
    In all 14 focus groups GAO held with older women, women described some level of anxiety about financial security in retirement. Many expressed concerns about the future of Social Security and Medicare benefits, and the costs of health care and housing. Women in the groups also cited a range of experiences that hindered their retirement security, such as divorce or leaving the workforce before they planned to (see fig.). Women in all 14 focus groups said their lack of personal finance education negatively affected their ability to plan for retirement. Many shared ideas about personal finance education including the view that it should be incorporated into school curriculum starting in kindergarten and continuing through college, and should be available through all phases of life. Women Age 70 and Over by Marital Status Note: Percentages do not add up to 100 percent due to rounding. Individual women's financial security is also linked to their household where resources may be shared among household members. According to the 2016 Survey of Consumer Finances, among households with older women, about 23 percent of those with white respondents and 40 percent of those with African American respondents fell short of a measure of retirement confidence, indicating their income was not sufficient to maintain their standard of living. The likelihood of a household reporting high retirement confidence rose in certain cases. For example among households of similar wealth, those with greater liquidity in their portfolio and those with defined benefit plan income were more likely to report high retirement confidence. Older adults represent a growing portion of the U.S. population and older women have a longer life expectancy, on average, than older men. Prior GAO work has found that challenges women face during their working years can affect their lifetime earnings and retirement income. For example, we found women were overrepresented in low wage professions, paid less money than their male counterparts during their careers, and were more likely to leave the workforce to care for family members. Taken together, these trends may have significant effects on women's financial security in retirement. GAO was asked to report on the financial security of older women. This report examines (1) women retirees' perspectives on their financial security, and (2) what is known about the financial security of older women in retirement. GAO held 14 non-generalizable focus groups with older women in both urban and rural areas in each of the four census regions. GAO also analyzed data from three nationally representative surveys—the 2019 Current Population Survey, the Health and Retirement Study (2002-2014 longitudinal data), and the 2016 Survey of Consumer Finances. For more information, contact Charles Jeszeck at (202) 512-7215 or jeszeckc@gao.gov.
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  • Decennial Census: Bureau Should Assess Significant Data Collection Challenges as It Undertakes Planning for 2030
    In U.S GAO News
    What GAO Found In March 2020, the Census Bureau (Bureau) delayed the start of field data collection because of COVID-19 safety, and then revised several operational timelines in response to the pandemic and Department of Commerce (Commerce) decisions. Nationally the Bureau reported completing more than 99 percent of nonresponse follow-up cases (households that have not responded to the census) by October 15, 2020. The Bureau attributes the use of technology as among the reasons it completed the work by this date. The Bureau, however, had lower completion percentages ranging between 94 and 99 for 10 local geographic areas, in part because of natural disasters and COVID-19. For example, according to the Bureau, in Shreveport, Louisiana, short-term closures stemming from the hurricane impacted data collection for 82,863 housing units. As a mitigation strategy, the Bureau shifted the Shreveport operation to telephone enumeration and brought in more than 1,200 enumerators from travel teams. Despite these efforts, the Bureau was unable to complete 22,588 cases in Shreveport before data collection ended. For these cases the Bureau will need to rely on alternate methods including imputation, which draws data from similar nearby households to determine whether a housing unit exists, whether it is occupied, and, if so, by how many people. In addition to the challenges brought on by natural disasters, the Bureau encountered other difficulties during nonresponse follow-up, such as, the inability of supervisors to reassign open cases in a timely fashion. GAO found that census field supervisors did not have the authority to reassign cases and had to wait for the field manager to make those reassignments. Bureau officials told GAO it would consider the reassignment of cases as it moves towards planning for the 2030 Census. To monitor nonresponse follow-up, the Bureau used quality control procedures, such as real-time monitoring of enumerator activities by supervisors and training assessments. However, GAO found the Bureau did not have proper controls in place, allowing some enumerators to work without having passed the required training assessment. The Bureau agreed that additional controls were necessary. The Bureau planned to count individuals living in group quarters, such as skilled-nursing and correctional facilities, between April 2, 2020, and June 5, 2020, but revised those dates to July 1, 2020, through September 3, 2020. The pandemic made it difficult to count group quarters. For example, Bureau staff found it challenging to locate a point of contact at some group quarters because facilities were closed due to the pandemic. Bureau officials told us that in December 2020 they decided to re-contact more than 24,000 out of approximately 272,000 group quarter facilities to collect data, and that imputation would be used to count individuals at the remaining facilities still reporting a zero population count. The Bureau is updating plans to assess operations and identify resulting lessons learned from the 2020 Census. As part of its planning for 2030, it will be important for the Bureau to assess the impact of the 2020 late design changes and the operations' challenges that arose. Why GAO Did This Study The 2020 Census was conducted under extraordinary circumstances. In response to the COVID-19 pandemic and related Commerce decisions, the Bureau made a series of late changes to the design of the census. As GAO previously reported, these changes introduced risks to the quality of data that the Bureau provides for congressional apportionment and redistricting purposes. GAO was asked to review the Bureau's implementation of the 2020 Census. This report assesses the Bureau's implementation of the: (1) nonresponse follow-up operation, (2) group quarters enumeration, and (3) plans to assess those operations. To address these objectives, GAO conducted a series of surveys of all 248 census offices during the collection of data for those operations. GAO also monitored the cost and progress of operations and interviewed census field supervisors for each operation.
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  • Medicaid: HHS’s Preliminary Analyses Offer Incomplete Picture of Behavioral Health Demonstration’s Effectiveness
    In U.S GAO News
    What GAO Found The Protecting Access to Medicare Act of 2014 (PAMA) established the Certified Community Behavioral Health Clinics (CCBHC) demonstration and tasked the Department of Health and Human Services (HHS) with its implementation. CCBHCs aim to improve the behavioral health services they provide, particularly for Medicaid beneficiaries. Initially established for a 2-year period, the demonstration has been extended by law a number of times; most recently, it was extended to September 2023. States participating in the demonstration can receive Medicaid payments, consistent with federal requirements, for CCBHC services provided to beneficiaries. PAMA also required HHS to assess the effect of the demonstration on service access, costs, and quality. HHS's preliminary assessments of the demonstration in eight states, with 66 participating CCBHCs, found the following: Access. CCBHCs commonly added services related to mental and behavioral health, such as medication-assisted treatment, and took actions to provide services outside the clinic setting, such as through telehealth. Costs. States' average payments to CCBHCs typically exceeded CCBHC costs for the first 2 years of the demonstration. CCBHC payments and costs were more closely aligned in the second year for most states, better reflecting the payment methods prescribed under the demonstration. Quality. States and CCBHCs took steps, such as implementing electronic health records systems, to report performance on 21 quality measures. GAO found data limitations complicated—and will continue to affect—HHS's efforts to assess the effectiveness of the demonstration. For example: Lack of baseline data. PAMA requires HHS to assess the quality of services provided by CCBHCs compared with non-participating areas or states. The demonstration marked the first time these clinics reported performance on quality measures, so no historical baseline data exist. HHS officials noted that with time, additional data may provide insight on the quality of services. Lack of comparison groups. PAMA requires HHS to compare CCBHCs' efforts to increase access and improve quality with non-participating clinics and states. HHS was unable to identify comparable clinics or states due to significant differences among the communities. Lack of detail on Medicaid encounters. PAMA requires HHS to assess the effect of the demonstration on federal and state costs and on Medicaid beneficiaries' access to services. HHS plans to use Medicaid claims and encounter data to assess such changes. However, GAO has previously identified concerns with the accuracy and completeness of Medicaid data and has made numerous recommendations aimed at improving their quality. HHS's decisions in implementing the demonstration also complicated its assessment efforts. HHS allowed states to identify different program goals and target populations, and to cover different services. HHS also did not require states to use standard billing codes and billing code modifiers it developed. The lack of standardization across states limited HHS's ability to assess changes in a uniform way. Why GAO Did This Study Behavioral health conditions—mental health issues and substance use disorders—affect millions of people. HHS estimates that 61 million adults had at least one behavioral health condition in 2019—41 million of whom did not receive any related treatment in the prior year. Many individuals with behavioral health conditions rely on community mental health centers for treatment, but the scope and quality of these services vary. To improve community-based behavioral health services, PAMA created the CCBHC demonstration and provided HHS with $25 million to support its implementation. PAMA directed HHS to assess the demonstration and to provide recommendations for its continuation, modification, or termination. To date, HHS has issued three annual reports assessing the initial demonstration period, which ran from 2017 to 2019. HHS plans to issue a fourth annual report and a final report by December 2021. This report describes HHS's assessment of the demonstration regarding access, costs, and quality. Under the CARES Act, GAO is to issue another report on states' experiences by September 2021. GAO reviewed federal laws and regulations; HHS guidance; and HHS's assessments of the demonstration, including three issued reports, interim reports, and the analysis plan for future reports. GAO also interviewed HHS officials and officials from organizations familiar with community health clinics. HHS provided technical comments, which GAO incorporated as appropriate. For more information, contact Carolyn L. Yocom (202) 512-7114 or yocomc@gao.gov.
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