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Fiscal Year 2010 Annual Report by MassAGO

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									Public Document No. 12
Office Of AttOrney GenerAl MArthA cOAkley                  BOstOn Office                     cOnsuMer hOtline             insurAnce frAud tiPline
One Ashburton Place, Boston, MA 02108                      100 cambridge street              Phone: (617) 727-8400        Phone: (617) 573-5330
Phone: (617) 727-2200 tty: (617) 727-4765                  Boston, MA 02108                  hours of operation for the   the insurance fraud tipline
www.mass.gov/ago                                           Phone: (617) 727-2200             consumer hotline are         (accepting calls 24 hours) is
                                                                                             10:00 a.m. to 4:00 p.m.      intended for calls pertaining to
                                                           new BedfOrd Office
                                                                                                                          fraud in any of the following:
                                                           105 william street, first floor   elder hOtline
                                                                                                                          workers’ compensation, motor
the Office of Attorney General Martha coakley consists     new Bedford, MA 02740             Phone: (888) AG-elder
                                                                                                                          vehicle insurance, disability,
of the executive Bureau which includes management          Phone: (508) 990-9700             (243-5337)
                                                                                                                          health care billing, and
and communications functions, and four bureaus that
                                                           sPrinGfield Office                fAir lABOr helPline          unemployment insurance.
perform substantive legal work: Government; criminal;
                                                           1350 Main street, fourth floor    Phone: (617) 727-3465
Business and labor; and Public Protection and Advocacy.                                                                   VictiM cOMPensAtiOn And
                                                           springfield, MA 01103
Most staff members work in the Boston office locations,                                      insurAnce And heAlth cAre    AssistAnce hOtline
                                                           Phone: (413) 784-1240
and the Attorney General also maintains regional offices                                     cOnsuMer helPline            Phone: (617) 727-2200 ext. 2160
in central (worcester), southeastern (new Bedford),        wOrcester Office                  Phone: (888) 830-6277
and western (springfield) Massachusetts. in fy09, the      10 Mechanic street, suite 301
Attorney General’s Office returned over $657 million to    worcester, MA 01608
the commonwealth and its residents.                        Phone: (508) 792-7600
A Message from Attorney General Martha Coakley

                   the preparation of this 4th Annual report marks an opportunity to reflect not only on the past
                   year but also on my first term as your Attorney General. in my first message to readers of this
                   report, i said that my goal was “to make this office as effective and responsive as it can be, and
                   to use the skills, talent and energy of the staff to bring positive change to the lives and futures
                   of all who call the commonwealth home.”

                   Over these past four years, i am proud to say that the Attorney General’s Office has successfully
                   stood up for the consumers and taxpayers of the commonwealth, recovering more than a
                   billion dollars during that time. in fact, for every one dollar in our office’s budget, we recover
                   five dollars for the people of the commonwealth. As the state’s chief law enforcement office,
                   we also have worked to make our communities safer through investigations and prosecutions
                   as well as proactive prevention efforts.

                   Of course, one of the great challenges that we faced during these four years was the
                   economic crisis that has affected us all. we responded to that crisis aggressively by filing
                   groundbreaking actions against companies that contributed to the foreclosure crisis,
                   recovering hundreds of millions of dollars for taxpayers and helping to keep more than 15,000
                   people in their homes.

                   we’ve worked to keep energy rates down for families and businesses, and stood up for
                   consumers in the face of unfairness. we’ve prosecuted cases of fraud and corruption, and




                                                                                                   www.mass.gov/ago     i
leveled the playing field for businesses by taking on companies that mistreated workers. we’ve
taken on those who abused our seniors, violated people’s civil rights, or sought to prey on our
kids online.

this report is just a snapshot of the work that we do each day. we have highlighted priorities,
cases, and issues that we hope will give you the opportunity to better understand the breadth
of the work of this office.

i am grateful for this opportunity to serve as your Attorney General and look forward to
continuing to fight on your behalf over the next four years.

cordially,




Martha coakley
Massachusetts Attorney General




 ii   Fiscal Year 2010 Annual Report
                                                                                         Protecting
                                                                                         taxPayers
Protecting Taxpayers
   This year the AGO returned money          RECOVERIES FROM
to the Commonwealth’s General Fund           WALL STREET
and to the state’s Medicaid program,




                                                                                         saving
                                                                                         Money
                                                The AGO continued its strong
protecting the investment that we all
                                             leadership in holding big banks and
make as taxpayers and aggressively
                                             Wall Street accountable for their
going after the fraudulent use of
                                             role in the economic crisis. In FY
taxpayer funds.
                                             2010, through numerous landmark
   Of the $35.7 million recovered by
                                             cases, the office recovered more




                                                                                         Protecting
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the AGO in its capacity as the Medicaid
                                             than $20 million in taxpayer money
Fraud enforcement authority, over
                                             for the Commonwealth. (A more
$18 million was returned to the
                                             complete outline of the office’s work
Massachusetts Medicaid program.
                                             in response to the economic crisis is
These funds were recovered as a result
                                             outlined later in this report.)
of indictments of laboratories for a




                                                                                         coMMunities
variety of fraudulent acts (including        FALSE CLAIMS ACTIONS




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taking kickbacks) and other litigation          During FY10, the AGO entered
which addressed off-label marketing          into agreements with two major
of drugs. In addition to the significant     supermarket chains in Massachusetts
funds returned to the Commonwealth,          after an investigation unveiled that the
in parallel consumer protection              companies were overcharging public




                                                                                         Financial crisis
matters, the AGO obtained restitution




                                                                                           addressing
                                             entities for various prescription drugs
and compensation to consumers who            under the workers compensation
were defrauded. Other Medicaid fraud         insurance system, violating the
actions involved cases of unnecessary        Massachusetts False Claims Act.
medical or dental services or, in at least   Together      the    companies     paid
one case, the diversion of drugs paid        $246,127 to the Commonwealth and
for by Medicaid and were hallmarks of




                                                                                         develoPMent
                                             $94,463 to certain cities and towns in




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AGO efforts to save taxpayers money.         Massachusetts.


                                                                  www.mass.gov/ago   1
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                   Saving Money for the
                   Commonwealth
                      The AGO continued to look at the anti-      The AGO defends state agencies,         one case, the AGO saved $2.7 million
saving
Money




                   competitive effects of the pharmaceutical   and as such had an important role          in damages claimed by a plaintiff
                   industry’s efforts to undermine the         in FY10 in the implementation              arguing that its factory was damaged
                   ready availability of generic drugs.        of pension reform, ensuring that           due to an inadequate culvert on
                   In a case against pharmaceuticals           only eligible residents receive state      Interstate 1-95. In another case, staff
                   manufacturer Abbott Labs /TriCor, the       services. When the validity of fees or,    defended state agencies in cases
                   AGO recovered more than $750,000 (as        in some cases, an Agency’s authority       where the court or, in some cases a
Protecting
consuMers




                   part of a nationwide settlement of $22.5    to levy taxes was challenged,              jury, ultimately found no valid claim.
                   million) for Massachusetts agencies.        the AGO defended the relevant              The AGO also beat back overzealous
                      Also, the AGO’s work in the field        agencies. Of particular significance       efforts by plaintiffs to attach
                   of anti-trust has had international         was the AGO work in support of             government funds in situations
                   impact as in the case against               consolidation in the Department            where there was no right – these are
                   manufacturers of Dynamic Random             of Transportation and the defense          often matters in which swift analysis
coMMunities
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                   Access Memory (“DRAM”). AGO                 of the State Retirement Board. In          and action by AGO staff also saved
                   staff litigated a multistate price fixing   addition, the AGO’s defense of the         plaintiffs’ legal fees by narrowing the
                   case on behalf of Massachusetts             insurance commissioner’s order             issues to be tried.
                   government purchasers of electronic         rejecting proposed health insurance           The AGO has been a national
                   equipment         containing     DRAM       rate increases resulted in significant     leader in civil consumer protection
Financial crisis




                   computer chips and obtained                 taxpayer savings.                          actions against pharmaceutical
  addressing




                   settlements with seven international           In defense of various agencies,         companies including Merck, Eli
                   manufacturers for their role in the         the zealous advocacy of AGO staff          Lilly, and Pfizer, Inc. AGO attorneys
                   conspiracy. Compensation will be            yielded savings that can be quantified     successfully led the nation with
                   paid to the Commonwealth in an              mostly by what the Commonwealth            complex        investigations      into
                   amount to be determined.                    did not have to pay in damages as a        pharmaceutical and medical device
                                                               result of claims of negligible merit. In   company conduct resulting in a $33
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                    2   Fiscal Year 2010 Annual Report
                                                                                     Protecting
                                                                                     taxPayers
million national settlement with          tooth and ordered by the Court
Pfizer Inc. to resolve allegations        to pay over $36,000 in restitution;
of improper marketing of the              in another matter, the owner of
antipsychotic drug, Geodon.               a roofing company plead guilty
   Recognizing the significant cuts       to failing to pay over $119,000 in




                                                                                     saving
                                                                                     Money
to the vital local programs that          workers’ compensation insurance
serve     Massachusetts      residents,   premiums; finally, in a third case,
the AGO has delivered over $3.5           the Court sentenced a Revere man
million in grant funding, all obtained    to State Prison and ordered him to
through judgments and settlements,        pay over $164,000 in restitution for




                                                                                     Protecting
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throughout our communities. The           fraudulently using others’ identities
Prescription Drug Assistance Grant        to collect unemployment benefits.
provided over $1 million to 14
community health centers to help
defray the cost of drugs and/or the co-
pays for some of Massachusetts’ most




                                                                                     coMMunities
vulnerable residents.




                                                                                       Building
   In FY10, the AGO secured over
$769,000 in restitution orders to
the Commonwealth and private
insurers. These recoveries helped to
protect consumers and the integrity




                                                                                     Financial crisis
of the insurance system, including




                                                                                       addressing
the unemployment and workers’
compensation systems. The cases
were extremely varied: In one case, a
man was convicted of filing twenty-
one (21) fake injury reports with
insurance companies for the same




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                                                              www.mass.gov/ago   3
Protecting
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                   Protecting Consumers
                   UTILITY RATEPAYERS                                                                      thousands of Massachusetts motorcycle
                                                              transmission line in Maine at a 345 kV
                      The AGO serves as the Ratepayer         scale. As a result of the AGO’s inquiry,     riders during FY10.
saving
Money




                   Advocate working on behalf of              the line was scaled down to a 115 kV line.
                   individual and corporate citizens                                                       CONSUMER PROTECTION
                                                              The resulting savings to Massachusetts
                   for whom the cost of electricity and                                                    ACTIONS
                                                              ratepayers will be $18 million.
                   natural gas is often a significant            The Consumer Liaison Group                   The AGO uses the tools of
                   part of their bottom line. In FY10,        (CLG) was created with leadership of         investigation    and    enforcement
                   the AGO’s work resulted in $136                                                         actions (litigation) on behalf of
Protecting




                                                              theAGO in response to a Federal Energy
consuMers




                   million in savings for ratepayers.         Regulatory Commission (“FERC”)               consumers to protect them from
                   In one major case, the work of the         order to increase the responsiveness         fraud and deception. In FY10, the
                   office resulted in a reduction by          of Regional Transmission Operators           AGO investigated and settled
                   the Department of Public Utilities         to stakeholder interests. The CLG            incidents involving false and
                   in a National Grid’s rate request          provides electric consumers with a           misleading advertising practices
                   from $111 million to $43 million. In                                                    in the automobile sales industry.
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                                                              forum and an opportunity for input
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                   another case, a rate request from Bay      on the region’s electric markets             Agreements prohibited the use of
                   State’s rate was reduced from $34          and transmission planning and                “asterisk pricing” and required
                   million to $19 million and in another      construction process.                        payments for local consumer aid
                   case, advocacy by the AGO resulted                                                      programs and civil penalties. The
                   in the rejection by the Department of      MOTORCYCLE OWNERS                            AGO also obtained injunctive relief
Financial crisis




                   Public Utilities of NSTAR’s request           After receiving a complaint from a        against companies and individuals
  addressing




                   to recover $33.5 million in a rate         single consumer, AGO staff began a           making false promises to repair
                   settlement incentive payment.              comprehensive investigation and found        consumers’ credit in violation of
                      The AGO also works to address           widespread insurer overcharging of           state and federal law.
                   and to control the costs of proposed       motorcyclists. The investigation, still         The AGO filed enforcement actions
                   transmission projects. The AGO             ongoing, resulted in filings against         and obtained injunctions against
                   challenged the necessity of constructing   six insurers and provided over               travel companies who sold worthless
develoPMent
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                   a section of the Orrington-Maxsys          $20.7 million of restitution to tens of      travel club memberships to consumers



                    4   Fiscal Year 2010 Annual Report
                                                                                  Protecting
                                                                                  taxPayers
as well as against individuals who      make payments to those former
failed to provide consumers with        customers who were overcharged by
timeshares or made false promises       other insurance companies.
that they would obtain timeshare           In December of 2009, the AGO
deeds for consumers. In addition, the   released a comprehensive report on




                                                                                  saving
                                                                                  Money
AGO brought enforcement actions         the impact of managed competition
against various home improvement        in the auto insurance market in
contractors who failed to provide       Massachusetts. The report provides
services paid for or who were not       a detailed accounting of how the
licensed to perform contracting work    market is currently operating and




                                                                                  Protecting
                                                                                  consuMers
in Massachusetts.                       how consumers are being impacted.
   The    AGO      also    addressed       AGO undertook a blend of state-
overcharges in premiums paid by         specific and multi-state tobacco
consumers after finding that some       enforcement initiatives to ensure
insurance companies were failing to     that entities within the tobacco
abide by the 2009 Board of Appeal       distribution chain not only complied




                                                                                  coMMunities
statute. Under that law, insurance      with their statutory obligations but




                                                                                    Building
companies must report and use           also prohibited underage youth from
Board of Appeal determinations in       purchasing or otherwise accessing
setting consumers’ premiums. The        tobacco products.
AGO entered into settlements with          The AGO was active in the
eight companies this fiscal year. The   development and passage of laws that




                                                                                  Financial crisis
settling insurers were required to      added safeguards to the prescription




                                                                                    addressing
correct the at-fault determinations     drug monitoring program which
that    they    reported     to   the   allowed the AGO to have access
Comprehensive Loss Underwriting         to information that helps prevent
Exchange (C.L.U.E.), a privately        diversion of controlled substances.
operated database used to evaluate
customers’ driving histories, and




                                                                                  develoPMent
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                                                           www.mass.gov/ago   5
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                   HEALTH CARE                             elements of fraud and deception in          resolved 6,198 consumer complaints,
                      In the case of the deceptive         the marketing of pharmaceuticals.           resulting in $4,056,930.86 being
                   marketing of medical discount plans,    In one case, the AGO obtained $1.35         returned or credited to consumers.
                   often labeled as health insurance,      million consent judgment with                  Health     care    consumers    are
                                                           Stryker Biotech to resolve allegations      supported by a dedicated staff of
saving
Money




                   the AGO effectively used its broad
                   consumer protection authority to        that it marketed certain orthopedic         experts who accepted over 5,000 calls
                   pursue a multi-pronged approach.        products for uses that had not been         to the hotline, handled 916 mediations
                   Through       consumer     protection   reviewed and approved by the U.S.           and recovered over $261,000 to health
                   regulations     (effective    January   Food & Drug Administration (FDA).           care consumers. The Insurance and
                   22, 2010), the AGO has required                                                     Financial Services Mediation program
                                                           CONSUMER MEDIATION
Protecting
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                   organizations marketing health                                                      fielded 2,629 phone calls, opened
                                                              The AGO supports an expansive            639 complaints and recovered over
                   discount plans in Massachusetts to
                                                           voluntary mediation program designed        $701,000 in savings and refunds on
                   communicate clearly with potential
                                                           to help consumers outside of the formal     behalf of Massachusetts consumers.
                   customers about how their plans
                                                           court process. In FY10, the AGO funded
                   work. The AGO also filed litigation
                                                           13 Face-to-Face Mediation Programs,
                   against several companies enjoining
                                                           operating in many of the District Courts.
coMMunities




                   them from engaging in deceptive
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                                                           These programs mediated 3,205 cases
                   promotion of discount health plans
                                                           and helped consumers recover almost
                   in Massachusetts. To help consumers
                                                           $2.9 million.
                   protect their own interests, the AGO
                                                              Informal mediation of consumer
                   also issued consumer advisories
                                                           complaints, usually over the
                   to assist residents to understand
Financial crisis




                                                           telephone, is handled both by staff
  addressing




                   the costs and benefits of a medical
                                                           at the AGO and through a group of
                   discount card.
                                                           19 Local Consumer Programs who,
                      In addition to the significant
                                                           like the Face-to-Face Mediation
                   recoveries for the Massachusetts
                                                           Programs, are funded by the AGO.
                   Medicaid program, the AGO
                                                           Staff at the AGO and at the Local
                   addressed the consumer protection
                                                           Consumer Programs successfully
develoPMent
  econoMic




                    6   Fiscal Year 2010 Annual Report
                                                                                    Protecting
                                                                                    taxPayers
Building Stronger and
Safer Communities
   The Attorney General is the           PUBLIC CORRUPTION




                                                                                    saving
                                                                                    Money
chief law enforcement officer in            In FY10, the AGO was active in
Massachusetts. She is responsible        the development and passage of a
for the prosecution of significant       comprehensive set of ethics reforms
matters, especially in the areas of      which enacted broad bans on gifts
public corruption and fraud, and in      to public officials, strengthened the
addressing a variety of issues that




                                                                                    Protecting
                                                                                    consuMers
                                         Ethics Commission and authorized
cross jurisdictional boundaries and      the AGO to convene a statewide
are therefore beyond the purview         grand jury.
of one of the 11 District Attorneys in      In FY10, the AGO continued to
Massachusetts.                           focus on the protection of public
   FY10 saw the vigorous prosecution     funds through the prosecution of
of criminal organizations and




                                                                                    coMMunities
                                         public corruption matters. AGO




                                                                                      Building
perpetrators of violent crime. Work      efforts to address the fallout of the
of the AGO resulted in the disruption    financial crisis included the vigorous
and dismantling of major narcotics       prosecution of criminal fraud in
trafficking organizations. These cases   mortgage transactions and protecting
focused on trafficking in cocaine,       investors, consumers and other




                                                                                    Financial crisis
oxycodone, and marijuana trafficking     private victims of financial crimes.




                                                                                      addressing
and distribution, assault and battery    Working with financial investigators,
with a dangerous weapon, unlawful        prosecutors secured almost $8
gaming, the making of usurious loans,    million in restitution for government,
and other crimes with a significant      individual and charitable/non-profit
impact on public safety.                 victims. The AGO has successfully
                                         prosecuted        individuals     who




                                                                                    develoPMent
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                                                             www.mass.gov/ago   7
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                   defrauded the Commonwealth by                  Sanitary Code to target abandoned        legal and technical support to smaller
                   accepting kickbacks, filing false sales        and foreclosed homes in all regions.     NSP eligible communities to develop
                   tax returns and underreporting sales,             In FY10, the AGO implemented          receivership strategies, including
                   of almost $4 million. The AGO also             protocols for identifying clusters of    cross-bureau initiatives to do title
                   indicted individuals for falsifying            abandoned and foreclosed homes           searches, finding eligible receivers
saving
Money




                   teaching certificates, accepting bribes        in NSP eligible communities, taking      and introducing communities and
                   in connection with food stamps and             enforcement action under the             receivers to untapped funding sources
                   stealing money from regional transit           sanitary code that resulted in banks     through DHCD and related agencies.
                   authorities.                                   taking responsibility for repairs
                                                                  or having receivers appointed to         CYBER CRIME
                   NEIGHBORHOOD                                                                               Attorney General Coakley took a
Protecting
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                                                                  rehabilitate homes, resulting in a
                   REVITALIZATION                                 positive impact on neighborhoods         leadership role in at the beginning
                      One of many continuing effects of           particularly hard hit by foreclosures.   of her first term, by establishing
                   the financial crisis is the deterioration of      As a pilot project, in fewer than     the Cyber Crime Initiative and has
                   housing stock due to properties having         eight months the AGO worked with         developed a state-of-the art forensics
                   been foreclosed and abandoned. Each            the City of Lawrence in targeting 12     lab. The lab performs a huge number
                   individual property is also a part of                                                   of forensic examinations for the
coMMunities




                                                                  homes in and around one Lawrence
  Building




                   the fabric of a neighborhood so the            neighborhood. The AHI is addressing      AGO as a whole, and for various
                   reclamation of these properties is a           neighborhood blight by either            law enforcement agencies across the
                   key to neighborhood stabilization              owner intervention or receivership.      Commonwealth.
                   and community safety. In FY10,                 Throughout the Commonwealth,                The AGO’s role in addressing risks
                   the Abandoned Housing Initiative               over 100 abandoned homes have been       associated with technology includes
Financial crisis




                   (AHI) expanded its coverage through            identified and over 30 abandoned         having addressed over 575 reported
  addressing




                   the Neighborhood Stabilization Plan            homes have been, or are in the process   data breaches and demanded
                   (NSP) grant from the Department                of rehabilitation, as a result of the    compliance with the Massachusetts
                   of     Housing        and      Community       AHI’s actions. Receivership projects     Data Breach Notification Law from
                   Development (DHCD), using the                  have enabled local contractors to keep   organizations that failed to provide
                   receivership statute in the State              crews employed during the economic       proper notice to consumers.
                                                                  downturn. The AHI has provided
develoPMent
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                    8   Fiscal Year 2010 Annual Report
                                                                                     Protecting
                                                                                     taxPayers
    The AGO has undertaken a             provide information sharing, standards,
comprehensive review of the role         training, and tool certification to
of websites in facilitating human        computer forensic experts across the
trafficking and the illegal sex trade    Commonwealth. This will not only
and works in collaboration with          increase the effectiveness of existing




                                                                                     saving
                                                                                     Money
federal and local agencies as part of    law enforcement efforts, thereby saving
the Boston’s Human Trafficking Task      taxpayer money, it will also improve
Force.                                   the quality of evidence available
    Prosecutors   investigated    and    to prosecutors. Improved forensic
litigated a wide variety of cyber        evidence helps to build stronger and




                                                                                     Protecting
                                                                                     consuMers
crime cases including auction            safer communities.
fraud, child exploitation, child
                                         CIVIL RIGHTS
luring, consumer protection, child
pornography,      copyright,    credit      FY10 saw an unprecedented level
card fraud, cyberbullying, data          of civil rights enforcement in the
breach, employment scams, gaming,        areas of housing discrimination, hate
                                         crimes, and notably in the landmark




                                                                                     coMMunities
hacking/unauthorized           access,




                                                                                       Building
identification fraud, internet fraud,    victory in the constitutional case
and larceny.                             in federal district court striking
    AGO staff trained over 2,000 law     down the Defense of Marriage
enforcement officers in FY10 and         Act (‘DOMA”) that denied federal
worked together to begin the effort      benefits and protections to married




                                                                                     Financial crisis
to comprehensively address the use       same-sex couples and their families




                                                                                       addressing
of computers in the criminal sexual         Civil Rights enforcement saw
exploitation of women and men in the     its share of work generated by
Commonwealth. Finally, the Division      the increasing reliance in business
is in the process of establishing the    and commerce on technology and,
Massachusetts     Digital    Evidence    especially the internet. A sweep
Consortium. This group will work to      of listings on the popular website




                                                                                     develoPMent
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                                                              www.mass.gov/ago   9
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                   craigslist.org, yielded a statewide       Disabilities Act, however, continued    for law enforcement and school
                   enforcement effort against landlords      vigilance is necessary. In FY10,        administrators on cyber bullying.
                   and real estate companies who             the AGO secured groundbreaking             In its defense of state agencies,
                   posted discriminatory rental housing      settlement agreements with the          the AGO has an important
                   advertisements on the web. This           nation’s three largest movie theater    impact on community safety,
saving
Money




                   sweep resulted in over 40 judgments       chains to make theaters accessible      protecting the right of agencies
                   and settlements. The judgments            to people who are blind and deaf by     to deny gun permits, defending
                   and settlements included payment          using advanced technologies.            the suspension and revocation of
                   of money damages and strong                                                       drivers’ licenses who are convicted
                                                             KEEPING PEOPLE SAFE
                   injunctive relief, often requiring fair                                           of driving under the influence and
                                                             AND HEALTHY
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                   housing training for employees,                                                   protecting consumers by defending
                   adoption of fair housing policies and        In FY 10, the AGO was instrumental   administrative discipline against
                   procedures, affirmative advertising,      in the passage of a comprehensive       licensed professionals, contractors
                   and as appropriate, requiring             bullying prevention law that was        and tradespeople. Finally the office
                   property owners to clean up lead          passed by the Legislature and signed    regularly defended determinations
                   hazards to make safer housing for         into law by Governor Patrick in May     by the Department of Children and
                                                             2010. By statute, Attorney General
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                   children.                                                                         Families relative to child abuse and
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                      The AGO obtained a record              Coakley is leading a Commission on      neglect and successfully defended
                   number of civil rights injunctions        Bullying Prevention which is charged    on appeal the state buffer zone
                   against people who committed hate         with reviewing the Massachusetts        law to ensure that patients and
                   crimes based on the victim’s race,        General Laws and considering            staff members are protected at
                   national origin, sexual orientation       whether any laws need to be amended     reproductive health facilities.
Financial crisis




                   and/or religion. Since the beginning      in order to more effectively address       Recognizing that the health and
  addressing




                   of the Coakley administration in          bullying and cyber-bullying.            wellness of the Commonwealth’s
                   January 2007, the office has secured         AGO staff continue to conduct        youth is central to its community
                   forty-one      MCRA        injunctions,   extensive outreach and training         safety, the AGO elected to direct
                   including ten in FY10.                    in the area of bullying prevention,     over $1.5 million in proceeds from
                      2010 saw the 20th anniversary of       and in FY10, hosted a conference        judgments and settlements toward
                   the passage of the Americans with                                                 grants to 16 organizations in 12
develoPMent
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                   10   Fiscal Year 2010 Annual Report
                                                                                      Protecting
                                                                                      taxPayers
communities to provide jobs for           PROTECTING THE
over 230 youth. The jobs focused          ENVIRONMENT
on wellness to develop the next              The AGO is responsible for
generation of leaders with a              enforcement of civil and criminal
commitment to important principles




                                                                                      saving
                                                                                      Money
                                          laws      governing     environmental
of health and safety.                     protection. In FY10, the AGO
PROSECUTING CASES                         facilitated the redevelopment and
OF ELDER ABUSE                            productive use of contaminated sites
                                          including Hamilton Mills in Lowell,
   AGO authority over prosecutions
                                          AVX, the former Aerovox facility
of     Medicaid      fraud      extends




                                                                                      Protecting
                                                                                      consuMers
                                          on the harbor in New Bedford, the
beyond returning money to the
                                          6.7 acre Handy & Harmon site in
Commonwealth. Its authority includes
                                          North Attleborough, and Quantum
prosecution of cases of physical
                                          Properties, the 15 acre site of former
and sexual abuse or neglect, and of
                                          papermills in Holyoke.
diversion of medication by home
                                             Efforts by the office protected the
health aides and others caring for




                                                                                      coMMunities
                                          public water supply in tributaries to




                                                                                        Building
our neighbors and family members.
                                          the Quabbin Reservoir. AGO efforts
The AGO successfully prosecuted
                                          resulted in an order compelling
individuals who were paid, through
                                          ExxonMobil to install a new system
Medicaid, as personal care attendants
                                          to reduce its emissions at bulk gas
(PCAs) but violated the trust and
                                          facilities in Everett and Springfield,




                                                                                      Financial crisis
confidence of some of the most




                                                                                        addressing
                                          and AGO staff took action against
vulnerable of Massachusetts’ residents
                                          automobile inspection stations that
– the elderly and the disabled.
                                          conducted fraudulent inspections
   In one case a dentist was indicted
                                          of automobile emissions control
for allegedly using paperclips as
                                          systems
dental posts, but billing Medicaid for
the cost of the actual medical device.




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                                                              www.mass.gov/ago   11
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                      On the criminal side, the AGO          revised regulations on October 29th,      violence, an increase in the domestic
                   successfully     investigated      and    2010 with the Secretary of State’s        violence homicide claims received
                   prosecuted two people for tampering       Office and they were published in         in FY09. The total new domestic
                   with public drinking water samples        the Register on November 13th.            violence-related claims was 200 and
                   and with falsifying the results of           Our revisions expand the               driving under the influence claims
saving
Money




                   safety testing for public drinking        assistance options available to           totaled 12. Of the claims made eligible
                   water, individuals and companies          victims of violent crime without          during FY10, 133 victims were under
                   for failing to report oil spills or for   raising the existing cap on victim        the age of 17, and 23 victims were
                   improper storage and disposal of          compensation. Specifically the            over the age of 65. Under the Forensic
                   medical waste or other hazardous          changes eliminate the minimum             Sexual Assault Exam protocol, the
Protecting
consuMers




                   waste, 12 individuals and companies       loss requirement for the victim,          Division received 134 new claims
                   for illegally removing asbestos and       increase the funeral allowance,           for compensation and awarded
                   exposing workers and others to the        allow for crime scene clean-up and        $34,299.50 in exam expenses. During
                   risks of asbestos inhalation, and         security measures reimbursement,          FY10, the Division opened 915 new
                   eight individuals and companies for       and expand mental health benefits         claims and 540 supplemental claims,
                   fabricating environmental reports.        for non-offending parents of minor        awarding compensation to victims
coMMunities




                      The AGO played an effective role       victims. The modifications also           totaling $3,577,957.58 out of its state
  Building




                   as an advocate for stronger national      adjust the timeline for requesting        and federal monies.
                   standards relating to smog, mercury,      reconsideration, giving notice of a
                   and cancer causing particulates,          decision, and requesting judicial         CRIMINAL APPEALS
                   and for vigorous action to reduce         review in district court to reflect the      During FY10, work of the AGO
                   emissions of greenhouse gases.            time involved with reviewing such         resulted in 22 published decisions
Financial crisis




                                                             requests.                                 from the United States Court of
  addressing




                   SUPPORTING VICTIMS                           In FY10, the Victim Compensation       Appeals for the First Circuit, seven
                   OF CRIME                                  and Assistance Division received          published decisions from the
                      The passage of H.B. 1587               1,585 new claims, an increase             Supreme Judicial Court, 25 published
                   necessitated revisions of 940 CMR         of 166 over FY09. Of those, 200           and unpublished decisions from
                   14.00, Compensation of Victims of         were homicide claims, including           the Massachusetts Appeals Court,
                   Violent Crimes. The AGO filed the         29 homicides related to domestic          and more than 50 decisions from
develoPMent
  econoMic




                   12   Fiscal Year 2010 Annual Report
                                                                                       Protecting
                                                                                       taxPayers
the United States District Court.          on re-opening a conviction after it
Some of these cases involved novel         has been fully reviewed by the state’s
issues of law, such as the application     appellate courts.
of the Commonwealth’s drug                     During the past Fiscal Year, the
distribution laws to physicians who        AGO also expanded its amicus curiae




                                                                                       saving
                                                                                       Money
write illegal prescriptions, corporate     (“friend of the court”) practice. In
criminal liability for involuntary         the Supreme Judicial Court, the
manslaughter based on the collective       AGO drafted four amicus briefs
conduct and knowledge of multiple          on important questions of criminal
employees, and whether a police            justice and policy.




                                                                                       Protecting
                                                                                       consuMers
officer “deliberately elicits” a
confession from a suspect by serving
an arrest warrant on him in prison.        Addressing the
   Many of the decisions issued in these
cases will have a lasting and positive
                                           financial crisis
impact on the development of federal         In November 2007, Attorney
                                           General Coakley published The




                                                                                       coMMunities
habeas law, as well as on state criminal




                                                                                         Building
law and procedure. In Clements v.          American Dream Shattered: The Dream
Clarke, for instance, the First Circuit    of Homeownership and the Reality
reaffirmed a significant aspect of         of Predatory Lending. The report
habeas corpus law – specifically, when     documented comments made at
a state decision denying a prisoner’s      public hearings surrounding the new




                                                                                       Financial crisis
claim will be given deferential review     consumer protection regulations




                                                                                         addressing
by a federal court – in a manner that      governing mortgage lenders and
will benefit the Commonwealth in           brokers. The connection between
future cases. Similarly, in Foxworth v.    the misdeeds and outright fraud
Amand and Drew v. MacEachern, the          perpetrated by mortgage brokers and
Supreme Judicial Court and the First       others and the crisis of foreclosure
Circuit upheld important limitations       was made apparent and addressed,




                                                                                       develoPMent
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                   in part by the passage of state laws       LANDMARK CASES                            Massachusetts homeowners, $23
                   and the development of a stricter             In FY10 the AGO, negotiated            million to the Massachusetts Pension
                   regulatory framework within which          a      landmark      settlement    with   Fund for investment losses, and $19.5
                   home financing would operated in           Countrywide Financial Corporation         million in taxpayer money to the
                   the future. However thousands of                                                     Commonwealth’s General Fund.
saving
Money




                                                              through its successor, Bank of America
                   Massachusetts residents faced, and         Corporation. The settlement, which           The AGO sued State Street and
                   continue to face the loss of their homes   addressed Countrywide’s unfair and        obtained $10 million in penalties
                   and Massachusetts communities              deceptive loan origination practices,     and restitution for approximately
                   bear the scars of foreclosure. The         implemented        a     comprehensive,   270 investors harmed because State
                   AGO continued to address unfair            first-in-the-nation loan modification     Street issued certain bond funds
Protecting
consuMers




                   and discriminatory lending practices       program for distressed homeowners         which included subprime mortgage
                   in court and obtained broad and            resulting in an estimated $3 billion      debt that it did not disclose to the
                   inclusive injunctive relief for            in mortgage loan relief nationwide.       municipalities, charities, and others
                   thousands of homeowners that               For Massachusetts homeowners, loan        that invested in the funds. State Street
                   though challenged by the industry,         relief included principal reductions      then urged the investors to keep their
                   was ultimately affirmed by the             amounting to $18 million, plus an         money in the fund, even while State
coMMunities




                   Massachusetts Appeals Court.               additional $4.1 million for foreclosure   Street’s own executive employee
  Building




                      As the full scope of the financial      relief.                                   pension fund was bailing out.
                   crisis became apparent, Massachusetts         After an investigation by the AGO
                   consumers became familiar with                                                       FORECLOSURE
                                                              into its role in the securitization and   RESCUE SCAMS
                   terms like Auction Rate Security,          financing of Massachusetts subprime
                   and Collateralized Debt Obligation                                                      A whole new breed of scam
                                                              loans, investment giant Morgan Stanley
Financial crisis




                   and the AGO began to unravel the                                                     was developed, one in which the
  addressing




                                                              (Morgan) paid $102 million to affected
                   complex web of financial transactions                                                desperation of the homeowner facing
                                                              Massachusetts homeowners and the
                   and the effects that the securitization                                              foreclosure was met with the offer
                                                              Commonwealth. Under the Assurance
                   and financing of Massachusetts                                                       of a so-called foreclosure rescue.
                                                              of Discontinuance, filed in Suffolk
                   subprime loans had on residents and                                                  Foreclosure rescue firms showed
                                                              Superior Court, Morgan provided $58
                   on municipalities.                                                                   up almost overnight, many of them
                                                              million in relief to more than 1,000
                                                                                                        fly-by-night    schemes   designed
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                   14   Fiscal Year 2010 Annual Report
                                                                                     Protecting
                                                                                     taxPayers
to make money off of already             financing, purchase or sale of real
burdened homeowners. The AGO             estate as well as significant consumer
filed numerous enforcement actions       restitution and civil penalties.
against companies and individuals        Homeowners were not the only
that      solicited     Massachusetts    victims of the mortgage debacle –




                                                                                     saving
                                                                                     Money
homeowners         with    misleading    Massachusetts tenants often found
promises to save their homes from        out about foreclosures only when the
foreclosure, or who solicited and        sheriff showed up at the door. The
accepted illegal advance fees to seek    AGO obtained injunctions against
loan modifications for homeowners.       many loan servicers who unlawfully




                                                                                     Protecting
                                                                                     consuMers
The AGO obtained injunctions             attempted to evict tenants from
prohibiting these companies and          foreclosed properties.
individuals from continuing their           In addition to its enforcement
unlawful conduct in Massachusetts as     actions, the AGO defended state
well as consumer restitution and civil   agencies in their efforts to address
penalties.                               the fallout, in particular, in defense




                                                                                     coMMunities
    The AGO obtained judgments           of the sanctions for advertising




                                                                                       Building
against mortgage brokers, real           unregistered securities.
estate brokers, closing attorneys
                                         CRIMINAL MORTGAGE FRAUD
and straw buyers who deceived
homeowners into selling their homes         On the legislative and policy
under the false promise of avoiding      front, the AGO was active in the




                                                                                     Financial crisis
foreclosure in order to obtain title     development,      negotiation   and




                                                                                       addressing
to the homeowners’ residences and        passage of a new law (Chapter 258 of
strip most of the homes’ equity.         the Act of 2010) to address criminal
The judgments included permanent         mortgage fraud and to ensure
injunctions enjoining defendants         that the law covers the full range
from engaging in real estate closings    of mortgage transactions. On the
and other business relating to the       prosecution front, the AGO secured




                                                                                     develoPMent
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                                                             www.mass.gov/ago   15
Protecting
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                   a conviction and state prison time in
                   a case in which, using forged deeds,
                                                             representation by qualified legal
                                                             services organizations of individuals
                                                                                                     Fostering Economic
                   forged powers of attorney, and a          who are at risk of losing their homes   Development and a Level
                   corrupt mortgage broker, an attorney      due to fraud, misrepresentation or
                   orchestrated a scheme designed to         otherwise in connection with unfair,    Playing Field for Business
saving
Money




                   steal equity from Worcester area          deceptive or predatory lending             From the beginning of the Coakley
                   homeowners in danger of foreclosure.      practices. The AGO used a federal       administration, the work of the AGO
                   The AGO obtained indictments and,         grant from the Neighborhood             has been premised on the idea that
                   in the completed matters, convictions     Stabilization Program to expand         reasonable government regulation
                   against a group of defendants for         its efforts to address abandoned        and a vital business climate were not
Protecting
consuMers




                   fraudulently obtaining $12.5 million      and foreclosed housing, providing       only compatible but could result in
                   in mortgage loans from 19 financial       program and legal support to            synergies. The AGO is committed
                   lending institutions and defrauding       municipalities to assist them in        to supporting a level playing field
                   homebuyers in connection with the         bringing the housing stock back to      for all businesses through its civil,
                   purchase of 26 multi-family homes         productive use. In addition, the AGO    criminal, policy, legislative, and
                   in the Greater Boston area.               used funds secured from mortgage        education efforts. By helping to
coMMunities




                      Recognizing       the    prevention,   fraud matters to provide resources      ensure fairness for business, the AGO
  Building




                   education and outreach are vital to       to municipalities and community         is better able to support fairness for
                   protecting residents from predatory       based organizations to work toward      workers, taxpayers and others in
                   practices, in FY10, the AGO dedicated     additional restoration of abandoned     Massachusetts.
                   over $1 million in funds secured in       housing in 11 Massachusetts
                   judgments and settlements with            communities and all of Worcester        STREAMLINING REGULATIONS
Financial crisis




                   mortgage companies to provide             County.                                    In FY10, the office worked with
  addressing




                   grants to consumer and community                                                  the business community ensuring
                   programs that would provide                                                       that when agencies promulgate
                   consumer       outreach,     education                                            regulations under the Massachusetts
                   and related services in the area of                                               Consumer Protection Law, they now
                   financial literacy and borrower                                                   more thoroughly consider the impact
                   protection initiatives, including legal                                           of that regulation on small business.
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                   16   Fiscal Year 2010 Annual Report
                                                                                      Protecting
                                                                                      taxPayers
The AGO included business input         commercial real estate development.
in its work amending its existing       In this way the AGO is uniquely
debt collection regulations. This       positioned to zealously advocate on
effort was focused on updating          behalf of consumers and community
the AGO regulations in order to         safety and take an active role in




                                                                                      saving
                                                                                      Money
ensure streamlining of state and        protecting and fostering the economic
federal practice within the industry    vitality of our business and industry.
while at the same time, maintaining
                                        ENSURING A FAIR
protection of both the consumer and
                                        BUSINESS CLIMATE
creditor.
                                           Public construction in Massachusetts




                                                                                      Protecting
                                                                                      consuMers
   The AGO recognizes that the
business community is constantly        is a significant driver of the economic
concerned about unduly burdensome       engine. The public construction bid
regulations. That is why when           laws provide the means for awarding
implementing a new regulatory           authorities to obtain the lowest price
scheme, for example in the case         that competition among qualified
                                        contractors can secure and serve to




                                                                                      coMMunities
of date security regulations, the




                                                                                        Building
AGO takes into account the risk of      establish an open and honest procedure
inadvertent harm to the marketplace     for fair competition among bidders for
when protecting the balances the        public construction contracts. To provide
interests of consumers rights, with     additional guidance and increased
making certain regulations do not       transparency to the public procurement




                                                                                      Financial crisis
inadvertently harm the marketplace.     arena, the Attorney General’s Bid Unit




                                                                                        addressing
AGO staff worked extensively with       issued General Guidelines Regarding
the business community to address       Attorney General Bid Protests in
those concerns and to establish         November 2009 and updated the
a coordinated review process for        information on its website to make
bylaws, legislation, regulations, and   clear, concise and relevant information
certain cases that focus largely on




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                                                              www.mass.gov/ago   17
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                   available to the industry and the public   of driving school services in the Fall     million in restitution and penalties
                   entities governed by the laws.             River area. In another case, yielding      to workers and the Commonwealth,
                      AGO casework zealously enforces         benefits to voters and to municipalities   a record for the Office. The AGO
                   public bidding laws. In FY10, the          throughout Massachusetts, the AGO          continued its ongoing efforts to
                   Supreme Judicial Court upheld the          worked with other states and the           provide outreach to a wide range of
saving
Money




                   Attorney General’s finding that            Department of Justice in obtaining         stakeholders, including employer
                   UMass Lowell bypassed the public           a divestiture of certain assets in         associations, unions, community
                   bidding laws by entering into a lease      connection with the Diebold/Election       organizations and schools.
                   agreement with a private developer         Systems & Software acquisition. This          The AGO received complaints
                   to build a dormitory the school would      will help maintain competition in          from employees of Allied Waste
Protecting
consuMers




                   then lease. The residential housing        the market for voting and election         that the company was not paying
                   project involved creation of a new         machines in Massachusetts cities and       them properly for work performed
                   building, adjacent to the university’s     towns, and elsewhere around the            at the Oak Bluffs/Tisbury Transfer
                   campus and dependent on the use of         country. In another multi-state anti-      Station public works project. After an
                   the university’s parking lot, which the    trust action, AGO staff were involved      investigation, the AGO determined
                   university had the right to occupy for     in the Ticket Master/Live Nation           that Allied Waste failed to properly
coMMunities




                   30 years. The court agreed that such       acquisition and worked with other          pay certain employees the prevailing
  Building




                   a project constituted construction of      states and the Department of Justice to    wage and overtime from October 2005
                   a building as contemplated by the          obtain significant divestiture and other   through December 2007. As part of an
                   public bidding laws.                       remedies to protect consumers.             initial settlement agreement, Allied
                      On issues large and small, the AGO                                                 Wasted agreed to pay over $404,000 in
                                                              PROTECTING WORKERS
                   kept watch to protect the thriving                                                    restitution to the workers and a $50,000
Financial crisis




                   competition necessary to ensure a             The fallout of the financial crisis     penalty to the Commonwealth. In 2010,
  addressing




                   vital business climate. In one case,       left many workers without jobs             a supplemental audit revealed that
                   AGO staff obtained an Assurance of         and thousands the victim of wage           approximately 350 employees were
                   Discontinuance and civil fine against      violations. The Attorney General’s         owed over $1.3 million in restitution
                   the operator of a driving school           Office handled over 5,000 wage             for miscalculated prevailing wage and
                   who solicited an agreement among           complaints, many involving multiple        overtime rates. Allied Waste agreed to
                   competing operators to raise the price     workers, and returned over $9              pay in accordance with those findings.
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                   18   Fiscal Year 2010 Annual Report
                                                                                       Protecting
                                                                                       taxPayers
   The AGO began an investigation          OVERSIGHT OF
of Walmart following reports that          MASSACHUSETTS CHARITIES
workers were required to work                 The Massachusetts nonprofit
through their meal breaks. The AGO         sector generates about $87 billion in
secured a $3 million dollar settlement




                                                                                       saving
                                                                                       Money
                                           revenue annually, represents $207
to resolve allegations of widespread       billion in assets and employs close
violations of the Massachusetts Meal       to 450,000 workers. The non-profit
Break Law.                                 sector is, therefore, a significant
   As a result of complaints lodged with   contributor to the Commonwealth’s
the Governor’s Joint Enforcement Task      economic strength and its cultural




                                                                                       Protecting
                                                                                       consuMers
Force on the Underground Economy           heritage. A public charity is a
and Employee Misclassification, the        nonprofit      organization     whose
AGO launched an investigation of           purpose is charitable and which
Labor Solutions/Tam Vuong. The             collects, holds and expends funds for
owner and the staffing company were        the benefit of the public. Examples
indicted and pled guilty to violation      include philanthropic organizations,




                                                                                       coMMunities
of the state’s wage and hour laws and      as well as most nonprofit hospitals,




                                                                                         Building
insurance and tax fraud. The AGO’s         independent schools, colleges and
investigation revealed many of those       universities, social service providers
hired through Labor Solutions did          and cultural organizations. Examples
not receive the minimum wage or            of non-profit organizations that
mandatory overtime rates for a two-        are not public charities, and are




                                                                                       Financial crisis
year period beginning in September




                                                                                         addressing
                                           not regulated by the AGO, include
2007. Many workers, who were paid          chambers of commerce, labor unions,
in cash, were illegally charged $2 to      social clubs, civic associations, and
$3 a day for transportation, thereby       similar organizations that only
reducing their pay below the minimum       benefit their members. The AGO
wage. The Defendant was ordered to         works to safeguard the public’s
pay $500,000 in restitution to victims.




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                                                               www.mass.gov/ago   19
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                   interest in these organizations, as       approximately $606,000 recovered          Capital Management, L.P. This filing
                   well as ensure the proper solicitation    for charitable purposes.                  commenced the AGOs formal review
                   and use of charitable funds raised           In carrying out its responsibility     of the transaction which continued
                   from other sources.                       to assure the proper use of charitable    through FY10 and was finalized the
                       In FY10, the Attorney General         funds, the AGO reviews significant        following fiscal year in October, 2010.
saving
Money




                   approved 1,679 initial public charity     asset dispositions, changes in               In its continuing efforts to improve
                   registrations, processed 22,071 annual    purposes of charitable funds, as          regulatory clarity and transparency,
                   financial reports, and approved           well as proposed dissolutions by          the AGO issued several new
                   504 registrations for professional        charitable corporations organized         guidelines that address pertinent
                   solicitors, fundraising counsel, and      in Massachusetts to ensure that           issues in the charitable community,
Protecting
consuMers




                   commercial co-venturers. Fees for         charitable assets are managed             including guidance as to the laws
                   these activities generated in excess of   appropriately. During FY10, the AGO       and regulations for raffles and other
                   $2,250,000 – for the Commonwealth.        reviewed several hundred notices          gaming activity and the provisions for
                       As a party to the probate of all      regarding significant transactions        handling mergers and consolidation
                   estates in which a charitable interest    and approved the dissolution of 137       of charitable corporations.
                   exists and in all judicial proceedings    public charities.                            The AGO also tries to be responsive
coMMunities




                   affecting charitable trusts, during          In a significant piece of work, the    to current events. In the aftermath
  Building




                   FY08 the AGO: received and                AGO issued, in September 2009, its        of the tragic earthquake in Haiti,
                   reviewed 772 new wills, 1,210 interim     comprehensive report: Examination of      the AGO provided regular guidance
                   accounts, and 640 final accounts;         Executive and Director Compensation;      to residents about donating wisely
                   assented to 43 petitions to sell real     Increased Oversight.                      to the hundreds of charities that
                   estate; and received and reviewed            In May, 2010, pursuant to the          purported to be assisting victims by
Financial crisis




                   550 miscellaneous complaints and          requirements       of     Massachusetts   raising funds.
  addressing




                   filings with respect to these matters.    General Law Chapter 180, Section 8(A)        The AGO’s work, in addition to
                   The AGO also resolved 64 cases            (d), Caritas Christi Health Care System   investigation and enforcement, can
                   involving the misapplication of           (“Caritas”) filed formal notice of a      include analysis of how changes in the
                   charitable bequests or excessive fees,    proposed sale of the system’s assets      law affect Massachusetts residents.
                   which, in the aggregate, resulted in      and operations to Steward Health Care     In the months and years following
                                                             System LLC an affiliate of Cerberus       the implementation of managed
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                   20   Fiscal Year 2010 Annual Report
                                                                                       Protecting
                                                                                       taxPayers
competition in the auto insurance        brings to its negotiations with payers,
industry, and in the aftermath of the    correlates to prices paid. The AGO
landmark health insurance reform         did not find a correlation between
in Massachusetts, experts in the         different prices and the quality of care
AGO have continued their analysis        provided, sickness of the patients,




                                                                                       saving
                                                                                       Money
and are active players in helping to     or whether the provider served a
ensure fairness and effectiveness in     large Medicaid population or was an
these significant programs.              academic medical center. The AGOs
                                         landmark health care report resulted
HEALTH CARE COST                         from a year-long examination of the
CONTAINMENT




                                                                                       Protecting
                                                                                       consuMers
                                         market that was authorized by the
   In the spring of 2010, the AGO        Massachusetts Legislature.
released a report outlining findings        The AGO’s report has had a
from the extensive investigation into    profound effect upon the Massachusetts
the contracting practices between        market and national discussions on
commercial health care insurers          health system reform. The AGO’s
and health care providers (hospitals




                                                                                       coMMunities
                                         recommendations to promote value-




                                                                                         Building
and      physicians),     specifically   based purchasing led directly to
examining health care prices and         passage of Chapter 288 of the Acts of
how those prices are negotiated. The     2010 which instituted first in the nation
report identified and documented         standards for public reporting of health
serious system-wide failings in the      care information to promote market




                                                                                       Financial crisis
commercial health care marketplace       effectiveness.




                                                                                         addressing
that threaten access to affordable,
quality healthcare. Specifically, the
investigation found that the cost
of care was not value based and
that market leverage, the size of
the organization and the strength it




                                                                                       develoPMent
                                                                                         econoMic
                                                               www.mass.gov/ago   21
executive
 Bureau




                    Executive Bureau                        awareness, consumer protection,
                                                            education, and direct constituent
                                                                                                     with questions and complaints. PIAC
                                                                                                     offers a mediation program working
                                                            services. CIED is responsible for the    with Local Consumer Programs as
                    COMMUNICATIONS DIVISION                 development and management of all        an informal way to resolve consumer
criMinal




                       The Communications Division          grants related to consumer protection,   disputes with businesses. In FY10,
 Bureau




                    serves as the liaison between the       public health and safety; oversight      PIAC successfully resolved 6,198
                    Attorney General’s Office and the       of Local Consumer Programs/              complaints, resulting in $4,056,930.86
                    news media. In addition to responding   Face-to-Face Programs; facilitation      being returned or credited to
                    to all media inquiries and providing    of public awareness and education        consumers.
                    comment on behalf of the Attorney       through website management and the
                                                                                                     INFORMATION TECHNOLOGY
governMent




                    General’s Office, the Division also     development of collateral materials;
  Bureau




                    writes and distributes press releases   and AGO sponsorship of public               In FY10, the Information Technology
                    and holds press conferences in order    events, conferences, and trainings. In   Division (IT) continued work on the
                    to inform and educate the public        FY10, CIED managed grant programs        multi-year initiative to modernize
                    about the office’s work on behalf of    that      distributed   $4,827,873.15    the computer systems, networks and
                    residents of the Commonwealth.          to      communities       throughout     applications utilized by AGO staff. The
& advocacy Bureau
PuBlic Protection




                    The Communications Division also        Massachusetts                            Division made significant progress in
                    works closely with other divisions         The Public Inquiry & Assistance       the implementation of a new Event
                    throughout the office on a variety      Center (PIAC) provides central           Management application intended to
                    of projects aimed at providing          intake for the office’s consumer         standardize the way in which all divi-
                    information, consumer education,        complaint and constituent services       sions record, track and report their
                    and resources to the public.            operation. PIAC operates a consumer      operations. This effort will improve
Business & laBor




                                                            hotline receiving an average of 5,300    both the information available to
                    COMMUNITY INFORMATION
    Bureau




                                                            calls per month from consumers           management for decision making as
                    AND EDUCATION                           wishing to file a complaint or           well as the productivity of staff. Staff
                       The Community Information and        seeking information. A separate          continued work throughout the year
                    Education Division (CIED) serves        hotline focused solely on senior         to build secure, electronic interaction
                    as a clearinghouse for internal and     residents and staffed by volunteers      capability between residents and
                    external   communication,     public    similarly guides elder consumers         the AGO, implementing electronic
develoPMent
 attorneys
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    staFF




                    22   Fiscal Year 2010 Annual Report
                                                                                      executive
                                                                                       Bureau
communication capabilities for web       for all staff through the AG Institute.
based resident communications. IT        To ensure that staff has access to
works to develop strategic information   the latest information and training
management plans in support of           available and in furtherance of their




                                                                                      criMinal
AGO business goals: planning and         professional development, in FY10,




                                                                                       Bureau
implementing computer hardware           the AG Institute offered 21 programs
and software architecture in support     of continuing education to legal and
of multiyear technology initiatives;     non-legal staff on a variety of topics,
delivering training programs for         and also sponsored a presentation by
all employees to ensure full use of      a distinguished lecturer. The GCO




                                                                                      governMent
technology and to increase employee      handled over 400 Public Records




                                                                                        Bureau
productivity; supporting technology      Requests office wide, coordinated
use by AGO employees with                and monitored the appointments of
contemporary help desk technology,       Special Assistant Attorneys General,
methods and tools; and providing         and served as the point of contact
business systems analysis in support     to the National Association of




                                                                                      & advocacy Bureau
                                                                                      PuBlic Protection
of the business needs of each of the     Attorneys General on the review of
AGO bureaus and divisions.               approximately 56 multi-state amicus
                                         briefs and 30 other sign-on requests.
OFFICE OF THE                               The GCO also coordinates the STOP
GENERAL COUNSEL                          FRAUD (Stimulus Oversight and
   Within the AGO, the Office of the     Prevention of Fraud) Task Force for




                                                                                      Business & laBor
General Counsel (GCO) provides           the Commonwealth of Massachusetts,




                                                                                          Bureau
legal advice on ethics, conflicts of     which is primarily made up of
interest, contracts, employment,         representatives from federal and state
and administrative and managerial        oversight agencies.
issues. The GCO participates in AGO
diversity efforts and provides office-
wide, in-house training programs




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                    POLICY & GOVERNMENT                        regarding general policy concerns,          in numerous committees, outreach,
                       The Policy & Government Division        pending state and federal legislation,      and training activities including
                    (P&G) works on the state level with the    and referrals of constituent matters        the Victim and Witness Assistance
                    Legislature and state agencies, and also   from municipal officials. P&G staff meet    Board, the Sexual Assault Nurse
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                                                               regularly with community stakeholders       Examiner (SANE) Advisory Board,
 Bureau




                    with members of the Commonwealth’s
                    federal delegation and with municipal      on broad policy matters such as energy      the Governors Council to Address
                    leaders throughout Massachusetts.          and environmental concerns, criminal        Domestic and Sexual Violence, and
                    In FY10, P&G staff worked with             law proposals and consumer protection       as faculty of the Massachusetts
                    members of the Legislature on the          matters. Staff from the Division is         Victim Assistance Academy.
                    development of several major pieces of     available to provide legal analysis to         The Division also provides financial
governMent




                    legislation, including a comprehensive     legislative and administration staff on a   compensation, referrals, and other
  Bureau




                    anti-bullying law aimed at protecting      broad range of policy matters.              assistance to victims of violent
                    children, a new law establishing                                                       crimes through its stewardship of the
                                                               VICTIM AND WITNESS
                    criminal mortgage fraud, and important                                                 Victim Compensation and Assistance
                                                               SERVICES
                    updates to our victim compensation                                                     Program. Eligible victims and their
                                                                  The Victim and Witness Services          families can receive assistance in
& advocacy Bureau
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                    and public charities laws. These new
                                                               Division provides comprehensive             paying for out-of-pocket medical
                    laws further protect the public and
                                                               services to victims and witnesses           expenses, lost wages, funeral and
                    strengthen the AGO’s ability to keep our
                                                               involved in AGO cases. These                burial costs, mental health counseling,
                    communities safe. The AGO continued
                                                               services include referrals to other         and other crime-related expenses.
                    to work with the federal delegation on
                                                               state and local agencies and helping
                    a number of proposals such as funding
                                                               victims to understand the court
                    for low-income heating assistance,
Business & laBor




                                                               process and their role in it. Victim
                    preemption concerns with the new
    Bureau




                                                               Witness Advocates (VWAs) worked
                    federal consumer financial protection
                                                               on over 240 cases throughout the
                    law, and effectively recovering from
                                                               year serving victims and witnesses
                    the mortgage foreclosure crisis. The
                                                               involved with Criminal, Civil,
                    Division also responds to the needs of
                                                               and post-disposition matters. In
                    municipalities by answering questions
                                                               addition, staff members were active
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                    24   Fiscal Year 2010 Annual Report
                                                                                         executive
                                                                                          Bureau
Criminal Bureau                            habeas corpus proceedings filed by
                                           persons held in custody; represents
    The Criminal Bureau investigates       state officials and agencies, including
and prosecutes a wide spectrum of          judges, clerks, probation officers, and




                                                                                         criMinal
criminal cases and also focuses on         prosecutors, sued or issued subpoenas




                                                                                          Bureau
prevention and educational efforts to      in state or federal court proceedings
support public safety and quality of       arising from actions related to the
life for all Massachusetts residents.      criminal justice system; and defends the
The office focuses on cases that reflect   constitutionality and legality of state
the statewide jurisdiction and areas       criminal statutes, rules, practices, and




                                                                                         governMent
of investigative and prosecutorial         procedures in state and federal trial and




                                                                                           Bureau
expertise not addressed by other law       appellate courts. The Appeals Division
enforcement offices, particularly in the   provides services to victims, family
protection of taxpayer funds and the       members and witnesses in connection
integrity of governmental agencies. In     with federal habeas proceedings and
FY10, the Criminal Bureau included         direct state criminal appeals. During




                                                                                         & advocacy Bureau
                                                                                         PuBlic Protection
the following divisions: Appeals,          this Fiscal Year, the Division provided
Corruption and Fraud, Cyber Crime,         outreach to approximately 80 victims,
Insurance and Unemployment Fraud,          family members and witnesses,
Environmental Crimes Strike Force,         and accompanied approximately
Enterprise and Major Crimes, and the       30 victims and family members to
State Police Detective Unit.               proceedings in state and federal court.




                                                                                         Business & laBor
                                           CORRUPTION AND




                                                                                             Bureau
APPEALS DIVISION
                                           FRAUD DIVISION
   The Appeals Division represents
the Commonwealth on direct appeal             The Corruption and Fraud Division
in all criminal cases prosecuted by        investigates and prosecutes criminal
the Criminal Bureau; defends the           misconduct      involving    corrupt
Commonwealth in all state and federal      individuals and entities, whether




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                    public or private, and a broad array of    crimes with a cyber component,            facilitate more effective investigation
                    financial crimes, including fiduciary      including both crimes committed           while continuing to safeguard
                    embezzlement, complex financial            on a computer network and crimes          individual rights.
                    frauds, and tax crimes. The Division       involving electronic evidence. The
                                                                                                         ENTERPRISE AND MAJOR
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                    focuses on cases that have an impact       Division handles investigations
 Bureau




                    beyond the facts of the individual case,   and cases in the areas of identity        CRIMES DIVISION
                    that involve particularly vulnerable       theft, child exploitation, and large-        The     Enterprise    and     Major
                    victims, or that restore trust and         scale financial fraud, which utilize      Crimes Division targets criminal
                    confidence in institutions responsible     modern technology and threaten all        enterprises     and      organizations
                    to the public.                             segments of society. In addition to       using sophisticated investigative
governMent




                       Division members were prosecutors       investigation and prosecution, the        techniques and strategies in order to
  Bureau




                    or administrative staff until midway       Division continued its work on the        develop high-impact prosecutions.
                    through FY10 when the Division             six priority areas outlined in the 2007   The Division includes prosecutors
                    subsumed the Financial Investigations      Strategic Plan.                           and State Police assigned to the
                    Division adding seven civilian                The division delivered training        AGO who work closely with
                    investigative professionals to the team.   to over 2,000 law enforcement             various federal, state and local law
& advocacy Bureau
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                    These investigative professionals          personnel at 40 separate events,          enforcement authorities and agencies
                    work with Division prosecutors and         increased the number of users of          to target, investigate, prosecute, and
                    State Police to gather, examine and        the Cyber Crime Web-Portal (www.          disrupt criminal organizations in
                    report upon the prolific testimonial       maagocybercrime.org)         four-fold,   order to promote and ensure public
                    and documentary evidence vital to          continued its focus on statewide          safety in communities throughout
                    the Division’s investigations and          digital forensic evidence processing      the Commonwealth.
Business & laBor




                    prosecutions. In FY10, the Corruption      requirements by overseeing the               In FY10, Enterprise and Major
    Bureau




                    and Fraud division indicted 34 new         development of the Massachusetts          Crimes Division disposed of nine (9)
                    defendants and resolved 38 cases.          Cyber Crime Initiative Model              cases and opened twenty-one (21)
                                                               Policy Manual for Digital Evidence        cases for a wide variety of offenses,
                    CYBER CRIME DIVISION                       Analysts, and secured passage of          including     Narcotics     Trafficking
                      The Cyber Crime Division                 administrative subpoena and search        (heroin, cocaine, Oxycodone and
                    investigates and prosecutes                warrant amendments which will             marijuana), Extortion, Assault and
attorneys
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                    26   Fiscal Year 2010 Annual Report
                                                                                      executive
                                                                                       Bureau
Battery to Collect a Loan, Assault          Through the cooperation of the
and Battery with a Dangerous             Attorney General, the Department
Weapon, Breaking and Entering with       of Environmental Protection, and the
Intent to Commit a Felony, Gaming,       Massachusetts Environmental Police,




                                                                                      criMinal
Usury, Unlawful Firearm Possession,      the ECSF brings together prosecutorial,




                                                                                       Bureau
and Larceny. Eight of those cases        technical and investigative expertise
were resolved following jury trials      to identify environmental violations,
in Suffolk and Hampden Counties.         evaluate their impact on public safety
In addition, AAGs in the Division        and the environment, and develop
obtained 71 criminal indictments.        the evidence necessary to prosecute




                                                                                      governMent
There were 16 arrests. In addition,      environmental crimes. The types of




                                                                                        Bureau
the Massachusetts State Police           cases recently prosecuted by ECSF
assigned to the Division opened 12       involved the illegal treatment and
criminal investigations, and obtained    disposal of hazardous waste, the
via subpoena hundreds of financial       improper handling and removal
records from banks, mortgage             of asbestos, the filing of false




                                                                                      & advocacy Bureau
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companies, and other agencies in         environmental compliance reports,
furtherance of criminal investigations   and the failure to report releases of
throughout the Bureau.                   hazardous materials. ESCF handled 36
                                         cases in FY10 and obtained $299,500 in
ENVIRONMENTAL CRIMES                     fines and restitution.
STRIKE FORCE




                                                                                      Business & laBor
   The mission of the Environmental      INSURANCE AND
                                         UNEMPLOYMENT




                                                                                          Bureau
Crimes Strike Force (ECSF) is to
investigate and prosecute the most       FRAUD DIVISION
serious environmental violations            The Insurance and Unemployment
in Massachusetts, and to establish       Fraud Division (IUFD) investigates
precedents    for     environmental      and prosecutes those who commit
misconduct that will not be tolerated.   fraud against insurers (including:




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                    automobile, health care, and
                    disability),   and      against   the
                                                              Government Bureau                              At the end of FY10, the Government
                                                                                                             Bureau had 2,513 pending cases. These
                    Commonwealth’s        unemployment           The Government Bureau represents            matters resulted in almost $3 million
                    insurance and workers’ compensation       the Commonwealth, its agencies and             in savings from the zealous defense of
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                    system. IUFD prosecutes these                                                            litigation against Commonwealth.
 Bureau




                                                              officials in many types of civil litigation,
                    crimes to protect both Massachusetts      as well as defending Commonwealth
                    consumers and the integrity of the                                                       ADMINISTRATIVE
                                                              employees from civil claims made
                    insurance system thereby protecting                                                      LAW DIVISION
                                                              against them resulting from the
                    taxpayers from higher premiums            performance of their duties. The                  The Administrative Law Division
                    and taxes that result from fraud and      Bureau develops and maintains close            defends suits concerning the validity
governMent




                    assuring that those in need receive       working relationships with agency              of statutes and regulations and the
  Bureau




                    appropriate services. In FY10, IUFD       counsel and provides them with                 legality of government operations,
                    obtained over $750,000 in restitution     information and advice on matters of           particularly those seeking injunctive
                    orders in 69 matters.                     broad common interest, particularly            or declaratory relief; defends suits
                                                              where advance consultation may                 challenging adjudicatory decisions of
                    STATE POLICE                                                                             state administrative agencies; prepares
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                                                              prevent unnecessary litigation.
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                    DETECTIVE UNIT                                                                           legal opinions for constitutional
                                                                 The Government Bureau also initiates
                       The State Police Detective Unit        affirmative litigation on behalf of the        officers, heads of agencies, and certain
                    functions as an investigative branch of   Commonwealth when such litigation is           other officials concerning issues
                    the Criminal Bureau and is involved       in the public interest and has significant     arising from the performance of their
                    in investigations throughout all of       monetary value or raises legal or policy       formal duties; and reviews proposed
                    the Bureaus divisions. In FY10, the       issues of concern to the public and the        statewide initiative and referendum
Business & laBor




                    State Police assigned to the AGO had      Commonwealth. The bureau has three             questions under Amendment Article
    Bureau




                    93 criminal investigations pending,       divisions, Administrative Law, Trial           48 of the Massachusetts Constitution
                    executed 47 search warrants and           and Open Government, as well as a              to determine whether such questions
                    made 48 arrests.                          Municipal Law Unit. In the course of           are of the type that may lawfully
                                                              FY010, Government Bureau attorneys             appear on the ballot. In these matters,
                                                              opened 1,123 cases and closed 1,044 cases.     the Division addresses diverse subject
                                                                                                             matters, including land use and
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                    28   Fiscal Year 2010 Annual Report
                                                                                          executive
                                                                                           Bureau
housing, environmental protection,           DIVISION OF OPEN
education, health and human                  GOVERNMENT
services, employment and retirement,            As part of the 2009 Ethics Reform
professional licensing, taxation, and        Bill, the Open Meeting Law was revised




                                                                                          criMinal
insurance.




                                                                                           Bureau
                                             and now centralizes responsibility
TRIAL DIVISION                               for state-wide enforcement in the
                                             AGO. To prepare for the July 1, 2010
   The Trial Division defends suits
                                             effective date of the revised law, the
against state agencies or employees
                                             Attorney General created the Division
who are sued in the context of their
                                             of Open Government. Focusing on its




                                                                                          governMent
agency duties. These suits generally
                                             mandate to educate public officials,




                                                                                            Bureau
seek damages or other relief for alleged
                                             the media and members of the public
wrongful acts of government officials
                                             on the revised law’s requirements, the
or employees, particularly torts, real
                                             Division created training materials,
estate matters, contract-related disputes,
                                             including a comprehensive Open
employment disputes, civil rights




                                                                                          & advocacy Bureau
                                                                                          PuBlic Protection
                                             Meeting Law Guide, and conducted
violations, and environmental damage
                                             training sessions throughout the
claims. The Division also reviews certain
                                             Commonwealth.
contracts, leases, bonds, and various
                                                The      Division    also    drafted
conveyance documents submitted by
                                             regulations     to   implement      the
state agencies for approval as to form. As
                                             revised law. Among other things, the
required by statute, the Division must
                                             regulations detailed a straightforward




                                                                                          Business & laBor
review and approve all pre-litigation
                                             complaint process to investigate and




                                                                                              Bureau
settlements of tort claims against the
                                             resolve alleged Open Meeting Law
Commonwealth or its agencies for
                                             violations. In addition, the Division
$2,500 or more.
                                             created a website, providing access to
                                             a broad range of Open Meeting Law
                                             material, including the law itself, the




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                    regulations, training materials, the
                    complaint form and frequently asked
                                                             related to anticipated changes in
                                                             local laws and charters, continued to
                                                                                                        Public Protection and
                    questions.                               be significant.                            Advocacy Bureau
                                                                  The Municipal Law Unit has also
                    MUNICIPAL LAW UNIT                                                                     The Public Protection and Advocacy
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                                                             worked with municipalities and the
 Bureau




                       The Municipal Law Unit reviews        Department of Energy resources in          Bureau (PPAB) uses investigation,
                    and approves municipal by laws           the development of alternative energy      analysis, affirmative litigation, and
                    and by-law amendments from               (primarily wind and solar) zoning          other advocacy to advance the
                    the 351 cities and towns in the          by-laws which impose reasonable            Attorney General’s statutory and
                    Commonwealth.        The    Attorney     regulations on the siting of alternative   constitutional responsibility to enforce
governMent




                    General exercises a limited power to     energy projects. Certain of the by-        laws protecting the public. The bureau
  Bureau




                    disapprove local legislative action if   laws reviewed and approved by the          focuses on a wide range of issues,
                    the proposed amendment is found to       Municipal Law Unit include as-of-          including equality and civil liberties
                    be inconsistent with the laws or the     right siting for such projects, which is   for all, clean air, land and water, fair
                    Constitution of the Commonwealth         required for communities to qualify as     and competitive business practices
                    and Home Rule Charter amendments         Green Communities under the Green          in the areas of consumer protection,
& advocacy Bureau
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                    must be reviewed by the Attorney         Communities Act of July 2008. These        antitrust, and financial services
                    General,    During     FY010,     the    by-laws assist municipalities to save      and insurance, and access for all to
                    Municipal Law Unit reviewed 934          energy costs for public buildings and      affordable, high-quality health care.
                    zoning by-laws, 695 general by-laws      satisfy some of their energy needs from    The PPAB includes the following
                    and 45 charter amendments,               alternative sources.                       divisions: Antitrust, Civil Rights,
                       In addition, the AGO offers              During FY10, the Municipal              Consumer Protection, Environmental
Business & laBor




                    voluntary, informal review of            Law Unit worked closely with               Protection, Health Care, Insurance and
    Bureau




                    proposed town by law amendments,         town clerks and other municipal            Financial Services, and Investigations.
                    and—even though not subject to           officials regarding the revised Open       ANTITRUST DIVISION
                    review by the Attorney General—          Meeting Law, particularly as the new
                    proposed city ordinances. During                                                       The Antitrust Division protects the
                                                             requirements relate to the process
                    FY10, the number of calls from local                                                people, state agencies, and businesses
                                                             of zoning bylaw adoption and
                    public officials and members of                                                     of Massachusetts from anticompetitive
                                                             amendments.
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                    the general public, many of which                                                   practices and helps maintain and
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                    30   Fiscal Year 2010 Annual Report
                                                                                             executive
                                                                                              Bureau
encourage a competitive and vibrant          legislation to better address civil rights
economy through fair and effective           issues, and works with community and
enforcement of antitrust laws. The           advocacy groups to promote needed
Division investigates and challenges         civil rights for all. The Division litigates




                                                                                             criMinal
anticompetitive mergers, price-fixing        housing discrimination cases under




                                                                                              Bureau
agreements, and other illegal practices      the Massachusetts Anti-Discrimination
by companies, both local and national,       statute (M.G.L. c. 151B), investigates
that harm both Massachusetts                 and litigates hate crime cases under the
consumers and important state                Massachusetts Civil Rights Act (M.G.L.
interests. The Division also advocates       c. 12, s. 11H), and performs education,




                                                                                             governMent
for effective competition policy at the      outreach and enforcement work in the




                                                                                               Bureau
state and national levels by filing legal    area of disability rights through the
briefs in important antitrust cases,         efforts of the Division’s Disability Rights
engaging in policy initiatives, and          Project. The AGO currently has 117 open
promoting pro-competitive legislation.       cases, proceeding in the Massachusetts
                                             courts.




                                                                                             & advocacy Bureau
                                                                                             PuBlic Protection
CIVIL RIGHTS DIVISION
   The Civil Rights Division enforces        CONSUMER PROTECTION
laws protecting and securing for all         DIVISION
Massachusetts residents an equal                 The Consumer Protection Division
opportunity to participate in civic          protects Massachusetts residents and
society in areas such as education, health   business markets from unfair, deceptive,




                                                                                             Business & laBor
care, housing, financial services, public    and otherwise unlawful conduct that




                                                                                                 Bureau
accommodation, employment, civil             causes consumer harm. The Division
marriage, and voting, and the enjoyment      investigates business conduct and
of individual rights, autonomy, and          brings enforcement actions under the
privacy, under state and federal law. The    Consumer Protection Act (M.G.L.
Division brings enforcement actions,         c. 93A) to enjoin unlawful practices and
advocates in support of proposed             to recover consumer restitution, civil




                                                                                             attorneys
                                             penalties, and attorneys’ fees.




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                                                                     www.mass.gov/ago   31
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                    ENVIRONMENTAL                           legislative or other policy proposals;    consumers. In FY10, the HCD had 11
                    PROTECTION DIVISION                     intervening, where appropriate, in        matters open and obtained almost $1
                       The Environmental Protection         siting disputes; and entering into        million in judgments or settlements on
                    Division pursues three main types       Brownfields liability agreements          behalf of Massachusetts consumers.
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                                                            to further the clean-up and
 Bureau




                    of work: (1) prosecuting civil                                                    INSURANCE AND FINANCIAL
                    enforcement and cost recovery cases,    redevelopment of contaminated
                                                            sites.                                    SERVICES DIVISION
                    seeking to produce the greatest
                                                                                                         The Insurance and Financial
                    results in terms of compliance and      HEALTH CARE DIVISION                      Services Division (IFSD) represents
                    deterrence,     environmental    and
                                                               The Health Care Division (HCD)         the interests of consumers and the
                    public health benefits, and financial
governMent




                                                            advocates and brings enforcement          public in matters involving the
                    recovery; (2) handling defensive
  Bureau




                                                            actions to increase access to health      insurance, securities and commercial
                    cases, seeking to provide effective
                                                            insurance, control health care quality    banking industries. The Division
                    representation to support the policy
                                                            and costs, promote public health,         investigates and litigates consumer
                    choices made by state agencies
                                                            reduce disparities, and protect           protection and False Claims Act cases
                    and officials in implementing our
                                                            consumers. The Division investigates      and participates in insurance rate
& advocacy Bureau
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                    environmental protection laws; and
                                                            and litigates consumer protection         proceedings before the Division of
                    (3) undertaking affirmative, non-
                                                            cases involving health insurers,          Insurance. The Division also assists
                    enforcement work to develop and
                                                            health providers, and pharmaceutical      consumers by mediating insurance,
                    pursue innovative ways to further
                                                            companies, and assists state entities,    banking and investment disputes
                    environmental protection exercising
                                                            including the Commonwealth Health         that do not rise to the level of unfair
                    the Attorney General’s role as the
                                                            Insurance Connector and the Health        practices, and by advocating for
                    Commonwealth’s chief law officer.
Business & laBor




                                                            Care Quality and Cost Council,            statutory and regulatory reforms. In
                    This last area includes: bringing
    Bureau




                                                            in developing sound policies and          FY10, staff recovered over $701,000
                    “impact      litigation”   (typically
                                                            practices. In FY10, the Division’s        in savings and refunds on behalf of
                    against the federal government);
                                                            staff addressed consumer complaints       consumers, opened 639 complaints
                    participating as an amicus to help
                                                            relating to health insurance and health   and fielded over 2,600 phone
                    develop the law in a way that
                                                            care and took over 5,200 phone calls,     calls. In FY10, IFSD had 103 open
                    will further the Commonwealth’s
                                                            opened 916 complaints for mediation,      cases resulting in $82 million in
                    interests; developing or supporting
attorneys




                                                            and recovered over $261,192 for           consumer savings, over $320 million
  staFF




                    32   Fiscal Year 2010 Annual Report
                                                                                       executive
                                                                                        Bureau
in restitution to Massachusetts
consumers and more than $13 million
                                          Business and Labor Bureau
in payments to the Commonwealth.             Through the Business and Labor
                                          Bureau (BLB), the AGO protects the
INVESTIGATIONS DIVISION




                                                                                       criMinal
                                          public interest through fair, firm and




                                                                                        Bureau
   The     Investigations     Division    transparent investigation, reporting
conducts civil investigations for         and enforcement actions while
all divisions across the AGO.             providing certainty and equality in the
Investigators in the Division             market place. In so doing, the AGO
locate and interview victims,             takes the long view of promoting




                                                                                       governMent
witnesses and subjects; obtain and        a healthy economy and aims to




                                                                                         Bureau
review      documentary      evidence     balance regulatory enforcement and
from numerous sources including           review with advocacy for ratepayers,
individuals,      corporations,    and    consumers and workers. The bureau
federal, state, county, and municipal     also plays an important role by focusing
agencies;     conduct     surveillance,   on fraudulent acts and practices that




                                                                                       & advocacy Bureau
                                                                                       PuBlic Protection
background checks, and asset              occur in the context of commercial
checks; analyze financial records and     relationships. The bureau works to
perform other forensic accounting         prevent rising government costs caused
functions; and testify before Grand       by fraud involving business or medical
Juries and at trial.                      services provided to or regulated
                                          by the government and to level the




                                                                                       Business & laBor
                                          playing field so that no company can




                                                                                           Bureau
                                          gain an unfair advantage by breaking
                                          the rules. BLB includes the following
                                          divisions: Business, Technology and
                                          Economic Development; Energy and
                                          Telecommunications; Fair Labor;
                                          Medicaid Fraud; and Non-Profit




                                                                                       attorneys
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                                          Organizations/Public Charities.


                                                               www.mass.gov/ago   33
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 Bureau




                    BUSINESS, TECHNOLOGY                      or judicial proceedings on behalf           savings, some of which is based upon
                    AND ECONOMIC                              of consumers in connection with             the lifetime of a particular project.
                    DEVELOPMENT DIVISION                      matters involving the rates, charges,
                                                              prices, or tariffs of an electric, gas or   FAIR LABOR DIVISION
                       The primary role of the Business
                                                                                                             The Fair Labor Division enforces
criMinal




                                                              telephone company doing business
 Bureau




                    Technology and Economic Develop-
                                                              in the Commonwealth and subject to          various laws that protect workers,
                    ment Division (BTED) is to further the
                                                              the jurisdiction of state regulations.      including the prevailing wage,
                    Attorney General’s efforts to promote
                                                                  The Division works to ensure that       minimum wage, payment of wages,
                    economic growth in Massachusetts.
                                                              businesses and residents have access        overtime, tip pooling, child labor,
                    BTED is the liaison between the
                                                              to reliable, safe and affordable energy.    Sunday and holiday premium pay
                    business community and the AGO,
governMent




                                                              The Division litigates its cases before     laws, and the arbitration of related
                    promoting better communication,
  Bureau




                                                              state and federal courts, as well as        public construction bid disputes.
                    providing information and facilitating
                                                              administrative regulatory bodies such as    The Division has broad powers to
                    a better understanding of issues facing
                                                              the Massachusetts Department of Public      investigate and enforce violations of
                    the business community. In addition,
                                                              Utilities, the Federal Energy Regulatory    these laws through criminal and civil
                    BTED staff advise the Attorney
                                                              Commission,        and     the    Federal   enforcement actions. The Division uses
& advocacy Bureau
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                    General from the perspective of the
                                                              Communications Commission. In many          this authority to protect employees from
                    business community as the Attorney
                                                              of these matters, particularly public       exploitation by an employer, prosecute
                    General develops policy on matters
                                                              utility rate cases, the Attorney General    employers who are failing to follow
                    that may affect the economic climate
                                                              is the only active participant advocating   the Commonwealth’s wage and hour
                    of the Commonwealth.
                                                              on behalf of Massachusetts consumers.       laws, and set a level playing field with
                    ENERGY AND                                The Division is funded through an           clear rules that the Commonwealth’s
Business & laBor




                    TELECOMMUNICATIONS                        assessment on the gas, electric and         employers can follow, ensuring that
    Bureau




                    DIVISION                                  telecommunications companies doing          strong economic growth and fairness
                      Through the Energy and Telecom-         business in the Commonwealth. In FY10,      for workers go hand-in-hand. In FY10,
                    munications Division, the Attorney        there were approximately 187 cases          the Division recovered over $9 million
                    General serves as the Ratepayer           pending before state and federal bodies.    in restitution and penalties on behalf
                    Advocate in administrative and/           Matters that were finalized in FY10         of the Commonwealth’s workers.
                                                              yielded approximately $136 million in
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                     34   Fiscal Year 2010 Annual Report
                                                                                             executive
                                                                                              Bureau
MEDICAID FRAUD DIVISION                        public charities to safeguard the public’s
   The Medicaid Fraud Division (MFD)           interest in these organizations and to
works to prevent and, if necessary,            ensure the proper solicitation and use
prosecute provider fraud and violations        of charitable funds raised. Non-profit




                                                                                             criMinal
                                               charitable organizations, which range in




                                                                                              Bureau
of state law pertaining to fraud in the
administration of the Medicaid program.        size and scope, are major contributors to
The Division executes search warrants          the Commonwealth’s economic strength
and administrative document requests,          and its cultural heritage.
negotiates settlements, obtains judgments         The Division reviews annual
and convictions, and recovers criminal         public charity filings, works with




                                                                                             governMent
and civil restitution, fines, penalties, and   organizations to address and cure




                                                                                               Bureau
costs. In addition, the Division reviews       potential violations, and, when
complaints of resident abuse or neglect        necessary, conducts civil investigations
in nursing homes and other health care         and litigation to enforce the law. In
facilities. The Division serves as the         FY10, in the nonprofit context, the
                                               Attorney General approved 1,679




                                                                                             & advocacy Bureau
                                                                                             PuBlic Protection
Medicaid Fraud Control Unit for the
Commonwealth of Massachusetts and is           initial registrations, processed 22,071
annually certified by the Secretary of the     annual financial reports, and approved
U.S. Department of Health and Human            504 registrations for professional
Services. In FY10, the MFD had 339 cases       solicitors, fundraising counsel, and
pending. Closed cases yielded almost $36       commercial co-venturers. Fees for
million in recovery to the Commonwealth        these activities generated in excess of




                                                                                             Business & laBor
and Medicaid programs.                         $2,250,000 for the Commonwealth.




                                                                                                 Bureau
                                                  The Division also provided guidance
NON-PROFIT ORGANIZATIONS/                      charitable organizations through sev-
PUBLIC CHARITIES DIVISION                      eral advisories including: 8A guidelines,
  The Non-Profit Organizations/                Raffle guideline and mergers and
Public Charities Division supervises           consolidations guidelines.




                                                                                             attorneys
                                                                                               staFF
                                                                     www.mass.gov/ago   35
                    Fiscal Year 2010 Attorneys
executive
 Bureau




                                    A Ackil, Ann                 C calkins, sheila         D dalrymple, Joyce          G Geary, John
                                      Adams, stephen               callanan, Joseph          dekermenjian, krikor        Goldberg, i. Andrew
                                      Adreani, Jennifer            carriker, eric            desouza, Barbara dillon     Goldman, Julie
                                      Ahearn, Michael              cartee, Jennifer          doherty, Andrew             Goldman, lauren
                                      Aine, Geraldine              casey, timothy            dollar, robyn               Goldstein, Joanne
criMinal
 Bureau




                                      Alvarez-Jimenez, iraida      celli, Melissa            donnelly, edmund            Green, Jonathan
                                      Anderson, Bruce              cetola, david             donnelly, John              Groff, casey
                                      Anderson, deborah            chan, tackey              donovan, Brian              Grundy, richard
                                      Andrews, david               chintapalli, Pallavi      duhamel, Jessica            Guberman, david
                                      Arguin, James                choy-seymour, shannon     dundin, louis               Gunagan, kelli
                                      Armstrong, emily             clark, James              dupuis, renee               Gwiazda, Amy
                                      Augenstern, frederick        coakley, Martha         E eade, Mary                H hadas, david
governMent
  Bureau




                                    B Badway, eva                  collins, cathleen         eisemann, Jeremy            hammond, daniel
                                      Baily, christine             collins, Jeffrey          eisenstadt, Joseph          hanley, Patrick
                                      Balakrishna, Annapurna       connolly, Matthew         engel, Jonathan             harper, nancy
                                      Barnett, Jessica             connolly, rosemary        english, April              healey, Maura
                                      Barnico, thomas              conroy, kevin             ericson, Benjamin           healey-dippold, Jean
                                      Barry-smith, christopher     cooke, Margret          F fauth, lisa                 healy, Janice
& advocacy Bureau
PuBlic Protection




                                      Barshak, Jason               cosgrove, Audrey          feiner, Gillian             hettinger, lee
                                      Bedrosian, edward            cotter, Jennifer          fitzpatrick, kate           hirales, lillian
                                      Benedetto, Annette           cournoyer, Madonna        franck, Michael             hoffman, steven
                                      Bennett, leslie              cowin, william            frankl, laurie              hollander, Bart
                                      Berge, Matthew               cray, Pierce              freeley, Mary               hollingsworth, Adam
                                      Boecke, donald               cromack, daniel           freeman, william            hunt, Pamela
                                      Bowen, John                  cunha, Glenn              friedman, david             hunter, Marsha
Business & laBor




                                      Brock, Matthew               curseaden, John                                       hurley, Margaret
    Bureau




                                      Brookman, Monica                                                                 I iancu, carol
                                      Brown, susan                                                                       ireland, Matthew
attorneys
  staFF




                    36   Fiscal Year 2010 Annual Report
                                                                                                                                    executive
                                                                                                                                     Bureau
J Jalelian, lincoln     M Maietta, Anita           O O’Brien, thomas        S sacks, Peter            T tabor, Anna-Marie
  Johnson, lois           Mann, nora                 O’Brien, James           salinger, kenneth         tarantino, rosemary
  Johnson, thomas         Marks, david               O’Brien, eileen          schafer, scott            tarmey, Patrick
  Joliat, kiernan         Maroney, nancy             O’donnell, Brian         schofield, seth           tarrow, lorraine
  Jones, Marc             Marshalek, stephen         Ofilos, Jonathan         schrumpf, Matthew         thomas, Anne




                                                                                                                                    criMinal
                                                                                                                                     Bureau
  Jones, Miranda          Martland, douglas          Ogden, nicholas          sclarsic, Jonathan        thornton, Gabriel
  Jones, Jocelyn          Masinton, M. claire        Olson, neil              seder, sandra cardone     tosches, Jamie
  Joss, sarah             Massey, Jessica            O’Malley, r. Gabriel     sharobem, steven          trager, Bruce
K kaczmarek, Anne         Matlack, william           O’neill, william         shea, Matthew             tran, liza Jean
  kahn, stephanie         Matthews, Gregory          O’shea, Brendan          shin, sookyoung           triplett, tracy
  kalman, Judy            Mazlen, emiliano         P Pakstis, Joshua          singh, Amita              tseng, karen
  kaplan, Glenn           Mazzone, dean              Palfrey, Quentin         soris, Johanna          U unger, toby




                                                                                                                                    governMent
                                                                                                                                      Bureau
  karangekis, Amy         McBride, Britte            Paradise, emily          spackman, david         V Vanderweele, sally
  kehoe, ronald           Mccarthy, colleen          Pardee, william          spector, Amy              Veenstra, Jeanne
  kelly, christopher      McGuire, timothy           Parks, Margaret          stark, Jennifer           Villa, Amber
  killian, Bryan          McGuire, Joshua            Patten, robert           stark, Zoe              W walsh, Michael
  kim, tori               Mckinlay, James            Phillips, Mary           stephan, John             walsh, christopher
  klibaner, Alexander     Merrick, sandra            Pina, John               sterman, Anne             walsh, teresa




                                                                                                                                    & advocacy Bureau
                                                                                                                                    PuBlic Protection
  koenig, elizabeth       Meshnick, howard           Pine, Michael            stetson, James            waterfall, david
  kosla, kerry            Milkey, James              Porter, william          strayer, kerry            watras, katherine
  kosmetatos, Argiro      Miller, Jonathan           Price, elisabeth         sullivan, catherine       weber, Benjamin
L lam, siu tip            Miller, Jennifer         Q Quinan, robert           sullivan, Jennifer        welch, Jacqueline
  lamarre, teresa         Monahan, david           R ragland, sarah           sutliff, Mark             werner, Gwen
  lamb, Aaron             Monroe, natalie            rainer, Andrew           sweeney, James            whitcomb, James
  langlois, wendoly       Moriarty sousa, Marina     ralph, thomas                                      white, doris




                                                                                                                                    Business & laBor
  lawton, diane           Mullin, Peter              rathbun, danielle                                  wyzanski, charles




                                                                                                                                        Bureau
  lefkon, Owen          N nable, Amy                 ravitz, randall                                  Y yas, Anne
  leight, Peter           nosal, Jed                 reardon, susanne                                   yeager, k. nathaniel
  less, daniel                                       reyes, Jesse                                     Z Zachos, George
  letzler, Benjamin                                  reynolds, Maryanne                                 Zarbo, karla
  lockhart, emiley                                   rice, douglas
  lyons, Matthew                                     ritchie, ronald
                                                     rogers, Joseph




                                                                                                                                    attorneys
                                                     rom, Alan




                                                                                                                                      staFF
                                                     ross, Julie
                                                     rossi, Patricio
                                                                                                          www.mass.gov/ago     37
In Memorium




                  Loretta Smith

                                      1949 ~ 2009




        Loretta Smith was the Chief of our Government Bureau and passed away suddenly in the summer of 2009. She graduated from
     Boston University Law School and was a law clerk for Associate Justice Robert Braucher of the Supreme Judicial Court, before
     becoming an associate in 1980 at Goodwin, Procter & Hoar. She was an Assistant Attorney General from 1996 to 1997 in the
     Administrative Law Division. In 2001 she was named an Assistant District Attorney in the Appeals Bureau of the Middlesex
     District Attorney's Office until joining the Attorney General's Office in 2007. Loretta served the Office of the Attorney General and
     the Commonwealth of Massachusetts with distinction, and we are grateful for her public service.




38   Fiscal Year 2010 Annual Report
By The Numbers: Protecting Consumers and Taxpayers
in fy2010, the Attorney General’s Office saved or recovered more than $660 million for taxpayers and consumers, including:

$333 million        recovered from financial services companies as restitution to victims and payments to the commonwealth.

$82 million         in savings to automobile and motorcycle insurance ratepayers

$136 million        in savings to utility customers

$35.7 million       in civil recovery for Medicaid fraud

$18 million         in loan modification relief for Massachusetts consumers

$7.18 million       in restitution, penalties and fees in consumer protection judgments

$902, 980           recovered in Massachusetts as a result of AGO leadership in multi-state actions addressing improper marketing of pharmaceuticals.

$764,000            recovered for Massachusetts as a result of multi-state enforcement to prevent anti-competitive behavior in the area of generic
                    pharmaceuticals.

$9.3 million        in restitution and civil and criminal penalties for violation of fair wage laws

$4.9 million        in civil and criminal judgments arising from damage to the environment

$3 million          in revenue saved or recovered through civil litigation on behalf of state agencies

$4.05 million       returned to consumers through informal mediation plus $261,000 to consumers of health insurance

$701,000            recovered in saving and refunds through insurance and financial service meditation

$3.465 million      in compensation to victims of violent crime

$2.2 million        in fees generated for the regulation of charities and over $600,000 recovered as the result of the misapplication of bequests and fees
                    in Massachusetts estates.

$7.8 million        in recovery from perpetrators of public corruption and fraud

$769,748            in restitution ordered for victims of worker compensation and unemployment insurance fraud.

$156,000            in monetary relief to victims of civil rights violation

$14.4 million       in false claims Act cases paid to the commonwealth



                                                                                                                                        Design DonAteD bY LYDiA MAnn

								
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