WASHINGTON — September 7, 2026. The Justice Department headed into the Labor Day weekend with a burst of enforcement activity that touched nearly every corner of its docket: a fresh indictment tied to what the department calls the largest health care fraud case it has ever prosecuted, a proposed consent decree with one of the country’s largest landlords over algorithmic rent-setting, election-crime charges in three states, a corporate guilty plea in a fatal factory explosion, and a pair of money laundering convictions. With no new releases posted over the holiday, this edition of DOJ Watch digests the department’s announcements from September 3 and 4.
A recurring presence in this week’s docket is the National Fraud Enforcement Division, the unit the department stood up on April 7 to consolidate fraud prosecutions. Filings announced this week place the division at the center of three separate matters — health care fraud in Massachusetts and Florida, and a tax refund scheme charged out of Idaho.
As always, an indictment or complaint is an allegation only; defendants are presumed innocent unless and until proven guilty. Where this digest describes guilty pleas, verdicts, or sentences, that is noted explicitly.
$1.3 Billion in Five Months: Indictment Ties Pennsylvania Equipment Company to Russia-Based Fraud Network
A federal grand jury in the District of Massachusetts returned an indictment charging Erekle Gugava, 33 — described by prosecutors as an illegal alien from Georgia — with one count of money laundering conspiracy in connection with a $1.3 billion health care fraud scheme, the department announced Friday. If convicted, he faces a maximum of 20 years in prison.
According to the charging documents described in the release, Gugava served as a money launderer for a transnational criminal organization “based in Russia and elsewhere” — the network behind Operation Gold Rush, which the department calls the largest health care fraud case it has ever prosecuted. Prosecutors allege that Gugava purportedly owned ND Medical Solutions LLC, a Pennsylvania durable medical equipment company, for roughly five months between February and July 2025. In that window alone, filings indicate, ND Medical submitted at least $1.3 billion in fraudulent equipment claims to Medicare, Medicare supplemental insurers, and private plans — which paid out approximately $6.5 million before the billing stopped.
The indictment alleges the claims leaned on stolen identities of Americans across New England and beyond, including elderly and disabled beneficiaries who began flagging explanation-of-benefits forms for equipment they never received, prescribed by doctors they had never seen. Gugava allegedly opened ND Medical bank accounts as sole signatory, deposited insurer checks, and routed the funds to overseas accounts for the organization’s benefit. “Fraud networks cannot function without people willing to launder and transmit their proceeds,” said Assistant Attorney General Colin M. McDonald of the National Fraud Enforcement Division. The charge is an allegation; Gugava is presumed innocent.
Pinnacle Becomes Sixth Landlord to Settle in DOJ’s Algorithmic Rent-Setting Case
The Antitrust Division on Friday filed a proposed consent decree with Pinnacle Property Management Services LLC, the Frisco, Texas-based property manager the government describes as one of America’s largest landlords, resolving claims in its ongoing enforcement action in the Middle District of North Carolina over algorithmic coordination in rental markets.
The underlying complaint, filed January 7, 2025 with state co-plaintiffs, alleged that Pinnacle and five other large landlords set rents using one another’s competitively sensitive information through RealPage Inc.’s pricing algorithms, and conferred directly on pricing strategies. The department has already secured settlements with RealPage itself and with landlords Cortland Management, Greystar, LivCor, and Willow Bridge — making Pinnacle the sixth corporate resolution in the matter.
If approved by the court, the decree would bar Pinnacle from using pricing algorithms that ingest competitors’ sensitive data, prohibit sharing competitively sensitive information with rivals, impose a court-appointed monitor if the company adopts an uncertified third-party pricing tool, bar attendance at RealPage-hosted meetings of competing landlords, and require cooperation in the government’s claims against remaining defendants. Under the Tunney Act, the proposed final judgment and competitive impact statement will be published in the Federal Register, with a 60-day public comment window before the court decides whether entry is in the public interest.
Five Charged in Three States With Illegal Voting or Fraudulent Registration
Federal prosecutors in Pennsylvania, New Jersey, and Wisconsin announced charges against five individuals related to illegal voting in the 2022 or 2024 elections — a package the department elevated with statements from Attorney General Todd Blanche and FBI Director Kash Patel. “Election fraud is a serious crime, and it is the duty of the Department of Justice to treat it as such,” Blanche said.
In the Middle District of Pennsylvania, a grand jury indicted Thomas Holtzman, 68, a U.S. citizen, and his wife Marisol Guzman, 50, of Carlisle, on charges related to Guzman allegedly voting as an alien in the 2024 election; Holtzman is charged with false statement of citizenship and fraudulent registration on an aiding-and-abetting theory, carrying a maximum of 10 years. Separately, Katya Rodriguez, 30, of Harrisburg, described by prosecutors as an illegal alien from Mexico, faces charges carrying up to 11 years. In New Jersey, Mercedes Alexandra Cardoso of Union County — who filings indicate entered the country from Ecuador on a B-2 visitor visa — is charged with voting in the June 2024 primary; her initial appearance is set for September 8. In the Western District of Wisconsin, Jesus Javier Jurado Garcia, 25, of Beloit, is charged with voting in the November 2022 election.
The cases are individually small — three of the five charges carry one-year maximums — but the coordinated multi-district rollout, with statements from the attorney general, the FBI director, and Homeland Security Investigations, signals that noncitizen-voting prosecutions remain a department priority heading into the 2026 midterms. All five defendants are presumed innocent; the charges are accusations only.
Sentences Handed Down in $34.8 Million Medicare Brace Scheme
Two Florida men who pleaded guilty in May to conspiracy to commit health care fraud were sentenced to prison Friday. Kenneth Charles Kessler III, 43, of Miami, received 33 months; Michael Andrew Gomez, 43, of Miramar, received 24 months.
According to court documents cited by the department, the pair operated seven durable medical equipment companies that billed Medicare $34.8 million for orthotic braces shipped to beneficiaries nationwide who neither requested nor needed them, relying on doctors’ orders obtained through illegal kickbacks. When Medicare suspended payments to one company, prosecutors said, the men shifted billing to another. Kessler personally profited more than $1.4 million and Gomez more than $2.3 million. The department noted its Health Care Fraud Strike Force has charged more than 6,200 defendants tied to over $45 billion in billings since 2007.
Seven Charged in $57 Million Fictitious-Instrument Tax Scheme
A superseding indictment unsealed in Idaho charges seven people — Andrea and Kent Shannon of Kuna, Idaho, along with defendants from Illinois, Florida, Georgia, and California — with conspiring to claim more than $57 million in fraudulent refunds by filing false individual and trust returns and more than 100 fictitious financial instruments with the IRS between 2023 and 2024. Filings indicate the IRS actually paid out more than $8 million before the scheme was detected.
The Shannons, who were previously charged alongside two others, additionally face wire fraud, false claims, and money laundering counts — the latter tied to alleged purchases of luxury cars with fraud proceeds. The conspiracy count carries a 20-year maximum. IRS Criminal Investigation is handling the case; all seven are presumed innocent.
Corporate Guilty Plea in Fatal Columbus Plant Explosion
Yenkin Majestic Paint Corporation pleaded guilty in the Southern District of Ohio to negligent endangerment over an April 2021 explosion at its Columbus coatings and resin plant that killed one employee and severely injured several others.
The department’s account is a case study in accumulated safety shortcuts: a newly fabricated kettle door installed in December 2020 without pressure testing, a persistent leak addressed with a gasket the company wrongly believed was Teflon, and flammable-gas detectors that registered the fatal release but were never configured to sound an audible alarm. When a stalled agitator was restarted around midnight on April 8, 2021, pressure blew past the door’s seal and released hot resin and solvent vapor that found an ignition source minutes later. EPA’s Criminal Investigation Division led the probe with Ohio authorities. Sentencing terms were not announced in the release — a detail worth tracking.
Cartel-Linked Crypto Launderer Pleads Guilty in Kentucky
Carlos Erick Vazquez Gonzalez, 48, a Mexican national, pleaded guilty Friday in the Eastern District of Kentucky to money laundering conspiracy for moving roughly $4 million in U.S. drug proceeds back to Mexico through cryptocurrency. According to court documents, Vazquez Gonzalez worked with “money brokers” who arranged cash pickups in cities across the country, accepted deposits into a crypto wallet he controlled, layered the funds, then converted them to dollars in Mexico — collecting an estimated $40,000 in commissions. He faces up to 20 years at his December 17 sentencing. The DEA’s Lexington office led a sprawling investigation that drew on more than a dozen field offices.
DOJ Tells Maryland to Stop Charging Military Families “Illegal” Vehicle Fees
On the civil side, the Civil Rights Division issued a letter urging the Maryland Department of Transportation to stop collecting nonresident vehicle permit fees from servicemembers and spouses who keep their vehicles registered in their home states — a practice the department contends violates the Servicemembers Civil Relief Act by effectively taxing military families twice when orders bring them to Maryland. The letter asks the state to exempt military families going forward and refund fees already collected. Maryland’s response, and whether the dispute ripens into litigation, bears watching.
Worth Watching: TIJ’s Follow-Up List
Three threads from this week’s docket merit deeper reporting. First, the Gugava indictment raises an uncomfortable program-integrity question: how did a five-month-old shell company rack up $1.3 billion in Medicare billings before payment screens caught up? The $6.5 million actually paid suggests most claims were stopped, but the episode — and the broader Operation Gold Rush network, with 324 defendants charged — invites scrutiny of CMS’s front-end enrollment controls, which TIJ intends to pursue.
Second, the Pinnacle decree opens a 60-day Tunney Act comment window that will generate a public record on algorithmic pricing in housing — and the government’s cooperation requirement hints that claims against remaining defendants in the RealPage action are still live. Third, the three-state election package leaves open the methodological question of how the department is identifying noncitizen registrants — whether through DHS data-matching, state voter-roll production (the subject of multiple DOJ lawsuits since January), or tips — and how many similar cases are in the pipeline as the midterms approach.
Editor’s note: This digest is compiled from Justice Department press releases and publicly filed court documents linked above. Charges described as indictments, informations, or complaints are allegations only, and every defendant named here is presumed innocent unless proven guilty in court. TIJ did not receive comment from counsel for the individuals or companies named prior to publication; responses submitted through our contact page will be appended to this article.