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14 July 2017
Albuquerque Woman Sentenced to Prison for Federal Bank Robbery ConvictionRead the Press Release
ALBUQUERQUE – Joleen Sedillo, 42, of Albuquerque, N.M., was sentenced this morning in federal court to 27 months in prison followed by three years of supervised release for her conviction on bank robbery charges.
Sedillo and co-defendants Abel Lopez, 31, and William Colbert, 38, both of Albuquerque, were arrested in July 2016, on a criminal complaint charging them with bank robbery charges. The criminal complaint alleges that Sedillo, Lopez and Colbert robbed Bank of the West branches located at 5401 Central Ave. NE and 7900 Wyoming Blvd. NE on June 22, 2016 and June 27, 2016, respectively, and attempted to rob the Bank of the West branch located at 5228 Central Ave. SW on July 14, 2016.
Sedillo, Lopez and Colbert were indicted on Aug. 10, 2016, and charged with conspiracy to commit bank robbery in June and July 2016; bank robbery on June 22, 2016 and June 27, 2016; and attempted bank robbery on July 14, 2016. According to the indictment, the three defendants committed the crimes in Bernalillo County, N.M.
On March 28, 2017, Sedillo pled guilty to conspiracy to commit bank robbery and to aiding and abetting an attempted bank robbery. In entering the guilty plea, Sedillo admitted driving Lopez and Colbert to the Bank of the West branches they planned to rob. Sedillo further admitted that on July 14, 2016, she drove her co-defendants away from a branch of Bank of the West branch that Colbert attempted to rob. She also admitted concealing the clothing Colbert wore during the attempted robbery.
On April 5, 2017, Colbert pled guilty to conspiracy to commit bank robbery and to aiding and abetting an attempted bank robbery. Under the terms of his plea agreement, Colbert will be sentenced within the range of 41 to 51 months in federal prison followed by a term of supervised release to be determined by the court. On April 7, 2017, Lopez pled guilty to conspiracy to commit bank robbery and to aiding and abetting an attempted bank robbery. Under the terms of his plea agreement, Lopez will be sentenced within the range of 27 to 33 months in federal prison followed by a term of supervised release to be determined by the court. Colbert and Lopez are currently scheduled for sentencing hearings on July 21, 2017
This case was investigated by the Albuquerque office of the FBI and the Albuquerque Police Department. Assistant U.S. Attorney Michael D. Murphy is prosecuting the case.
Acting Manhattan U.S. Attorney Settles Civil Fraud Lawsuit Against Narco Freedom, Joining Hands Management, and Devorah Haigler for Engaging in Schemes to Defraud MedicaidRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and Scott Lampert, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General’s (“HHS-OIG”) New York Region, announced today that the United States has settled its claims brought under the False Claims Act against NARCO FREEDOM, INC. (“NARCO FREEDOM”), a former operator of outpatient chemical dependency clinics, and separately has settled its claims against JOINING HANDS MANAGEMENT INC. (“JOINING HANDS”), an operator of short-term residences known as “three-quarter houses,” and DEVORAH HAIGLER, co-owner of JOINING HANDS. The consent orders were approved yesterday by U.S. District Judge John G. Koeltl. Pursuant to the settlement, the three defendants admit and accept responsibility for conduct alleged in the Government’s complaint-in-intervention, the United States will receive a $50.5 million allowed claim in the Narco Freedom bankruptcy proceeding, and Joining Hands and Haigler will pay $300,000 to the United States and the State of New York, the federal portion of which is $141,180.
Acting U.S. Attorney Joon H. Kim said: “Narco Freedom not only defrauded Medicaid, it also victimized vulnerable low-income patients who were attempting to recover from drug and alcohol addictions. Particularly in light of the opioid epidemic ravaging our communities, we will act aggressively to stop such abusive conduct.”
HHS-OIG Special Agent in Charge Scott J. Lampert said: “This settlement puts an end to a greed-fueled scheme that callously compromised patient care and took advantage of an extremely vulnerable population. Health providers engaging in such behaviors should contemplate facing Narco Freedom’s fate – exclusion from all government health programs.”
The complaint-in-intervention filed by the United States alleged three separate fraud schemes. First, the complaint alleged that NARCO FREEDOM, JOINING HANDS, HAIGLER, and others were engaged in a kickback scheme, whereby NARCO FREEDOM made monthly cash payments to JOINING HANDS in exchange for HAIGLER and others referring residents of JOINING HANDS’ three-quarter houses, almost all of whom were Medicaid recipients, to NARCO FREEDOM outpatient programs and enforcing attendance at those programs, for which NARCO FREEDOM billed Medicaid. Second, the complaint alleged that NARCO FREEDOM and others were engaged in a kickback scheme whereby NARCO FREEDOM provided below-cost housing in its own three-quarter houses, known as “Freedom Houses,” to induce residents of those houses to enroll in and attend NARCO FREEDOM’s outpatient programs, and then evicted the residents as soon as NARCO FREEDOM had collected the maximum available Medicaid funds. Both schemes exploited vulnerable individuals who were forced to comply with NARCO FREEDOM’s rules because they lacked stable housing options. Third, the complaint alleged that NARCO FREEDOM and others directed and paid employees of its outpatient program in Red Hook, Brooklyn, to create false treatment records for certain patients and to backdate records.
As part of the NARCO FREEDOM settlement, NARCO FREEDOM, which is currently in Chapter 7 bankruptcy, has agreed (through the Chapter 7 Trustee) that the United States has a general unsecured claim for damages in the amount of $50,509,440, which will be paid through the bankruptcy proceeding on a pro rata basis with other general unsecured creditors. As additional terms of the settlement, NARCO FREEDOM will be excluded from all federal health care programs for 50 years, and the Chapter 7 Trustee will take steps to dissolve NARCO FREEDOM. NARCO FREEDOM, through the Chapter 7 Trustee, also has admitted, acknowledged, and accepted responsibility for the following conduct:
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Between 2006 and 2014, NARCO FREEDOM operated short-term residences known as “Freedom Houses.” As a condition of residence at the Freedom Houses, NARCO FREEDOM required residents to enroll in and attend a NARCO FREEDOM outpatient program. One purpose of the Freedom Houses was to induce Medicaid recipients to use NARCO FREEDOM’s outpatient programs by providing those individuals with subsidized housing.
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Between 2008 and 2011, NARCO FREEDOM made monthly payments to operators of three-quarter houses pursuant to purported “lease agreements” executed by NARCO FREEDOM, but these payments were not actually part of a legitimate lease arrangement, and instead were paid to incentivize the operators to require the residents of their houses to attend NARCO FREEDOM outpatient programs.
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In 2010, NARCO FREEDOM directed and paid counselors employed in its outpatient treatment programs in Red Hook, Brooklyn, to perform “corrective action and maintenance” on patient records, which included creating records reflecting that counselors had treated certain patients that the counselors had not in fact treated; claims based upon these false records were submitted to and paid by Medicaid.
NARCO FREEDOM’s conduct also was the subject of a lawsuit brought by this Office in October of 2014, United States v. Narco Freedom, Inc., 14 Civ. 8593 (JGK), in which the United States obtained a temporary restraining order and preliminary injunction enjoining NARCO FREEDOM from using the Freedom Houses to induce people to enroll in outpatient treatment programs. That suit ultimately resulted in the Court appointing a temporary receiver who oversaw the transition of NARCO FREEDOM’s clinics and Freedom Houses to other health care providers.
As part of the JOINING HANDS and HAIGLER settlement, they must pay a total of $300,000 to resolve the United States’ claims along with related claims asserted by the State of New York, of which the federal portion is $141,180. JOINING HANDS and HAIGLER also are enjoined from making or receiving payments of any kind in exchange for referrals or recommendations for any medical care or service, and from requiring residents to provide information relating to enrollment or attendance at an outpatient program.
JOINING HANDS and HAIGLER also admitted, acknowledged, and accepted responsibility for conduct alleged in the Government’s complaint, including the following:
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In 2008, JOINING HANDS and NARCO FREEDOM reached an agreement whereby NARCO FREEDOM would make monthly payments to JOINING HANDS and in exchange, JOINING HANDS would refer individuals residing in its three-quarter houses to NARCO FREEDOM outpatient programs.
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HAIGLER was aware of, and consented to, this agreement.
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Between 2008 and 2011, pursuant to this agreement and subsequent agreements, NARCO FREEDOM made monthly payments to JOINING HANDS, in amounts ranging from $4,000 to $15,000 per month, per house.
This case arose, in part, from a complaint filed under seal by whistleblowers under the False Claims Act.
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Mr. Kim thanked HHS-OIG for its investigative efforts and ongoing support and assistance with the case.
The case is being handled by the Office’s Civil Frauds Unit. Assistant U.S. Attorneys Kirti Vaidya Reddy and Cristine Irvin Phillips are in charge of the case.
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13 July 2017
Worcester Man Charged with Firearms OffensesRead the Press Release
BOSTON – A Worcester man was indicted today in federal court in Worcester on a federal firearms charge.
Steven Rivera, 24, was charged with being a felon in possession of ammunition. Rivera was arrested on June 29, 2017, as part of a coordinated federal and state sweep that resulted in the arrests of nine individuals who have been charged with firearms-related offenses.
According to court documents, Rivera – who has multiple prior felony convictions, including drug-related offenses – sold two handguns and numerous rounds of ammunition to a cooperating source in Worcester on Feb. 14, 2017. On Feb. 28, 2017, Rivera sold the cooperating source two more handguns and numerous rounds of ammunition, and during a recorded phone call, Rivera offered to sell the cooperating source heroin.
Eight others were arrested on state charges as part of an investigation into gun and narcotics trafficking in the Worcester area. During the course of the investigation, law enforcement purchased nine guns from nine defendants, including several handguns, two shotguns, and an assault rifle with a 100-round capacity drum magazine; multiple rounds of ammunition; and narcotics. Law enforcement seized several more guns during the June 29, 2017, sweep.
The charge of possessing ammunition after being convicted of a felony provides for a sentence of no greater than 10 years in prison, three years of supervised release, and a fine of $250,000. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney William D. Weinreb; Mickey D. Leadingham, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Boston Field Division; Colonel Richard D. McKeon, Superintendent of the Massachusetts State Police; Worcester County District Attorney Joseph D. Early Jr.; and Worcester Police Chief Steven M. Sargent made the announcement today. Assistant U.S. Attorney William F. Abely of Weinreb’s Worcester Branch Office is prosecuting the case.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Woman Indicted on Medicaid Fraud and Identity Theft ChargesRead the Press Release
RICHMOND, Va. – As part of the largest ever health care fraud enforcement action in Department of Justice History, a Richmond woman has been charged with healthcare fraud, aggravated identity theft, and making a false statement to federal agents.
Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts, including 115 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $1.3 billion in false billings. Of those charged, over 120 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS has initiated suspension actions against 295 providers, including doctors, nurses and pharmacists.
Chermeca Harris, 36, was arrested on Tuesday and the indictment was unsealed. Harris, a Medicaid beneficiary, would misrepresent her health condition to health care providers, such as hospitals and ambulance services, in order to obtain health care benefits. Specifically, she would falsely represent that she was suffering from sickle cell anemia and was having a sickle cell crisis in order to obtain pain killing drugs, such as dilaudid, which she wanted to receive intravenously through the neck. In fact, doctors tested Harris in January 2016, and determined she did not have sickle cell anemia. The hospitals involved were Virginia Commonwealth University Medical Center, Chippenham, Bon Secours St. Mary’s, Memorial Regional, John Randolph Medical Center, and Henrico Doctor’s.
According to the indictment, it was a further part of the scheme that Harris also falsely represented her identity. On some occasions she used the name of M.M., and on other occasions she used the name of R.J.; both Medicaid recipients. She also falsely stated to investigating federal agents that her name was M.M. and that she had sickle cell anemia.
Harris has been charged with eight counts of healthcare fraud on the Medicaid program, two counts of aggravated identity theft, and one count of making a false statement to federal agents. She faces a mandatory minimum of four years in prison and a maximum penalty of 89 years in prison, if convicted. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Field Office; and Nick DiGiulio, Special Agent in Charge, Philadelphia Regional Office of Inspector General of Department of Health and Human Services, made the announcement after the arrest. Assistant U.S. Attorney David T. Maguire is prosecuting the case.
The charges announced today aggressively target schemes billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics, a particular focus for the Department. According to the CDC, approximately 91 Americans die every day of an opioid related overdose.
Today’s enforcement actions were led and coordinated by the Criminal Division, Fraud Section’s Health Care Fraud Unit in conjunction with its Medicare Fraud Strike Force (MFSF) partners, a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, and State Medicaid Fraud Control Units.
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:17-cr-77.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
Waterbury Grocery Store Worker Sentenced to 30 Months in Prison for Food Stamp FraudRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that TALLAT MAHMOOD, 64, of Waterbury, was sentenced yesterday by U.S. District Judge Vanessa L. Bryant in Hartford to 30 months of imprisonment, followed by two years of supervised release, for defrauding the federal food stamp program.
The federal Supplemental Nutrition and Assistance Program (“SNAP”) is administered by the USDA’s Food and Nutrition Service and utilizes federal tax dollars to subsidize low-income households to provide them with the opportunity to achieve a more nutritious diet by increasing their food-purchasing power. SNAP recipients purchase eligible food items at retail food stores through the use of an Electronic Benefits Transfer (EBT) card, and SNAP benefits may be accepted by authorized retailers only in exchange for eligible items. Items such as alcoholic beverages, cigarettes, paper goods and soaps are not eligible for purchase with Food Stamp benefits, and it is a violation of the rules and regulations governing the food stamp program to allow benefits to be used to purchase ineligible items. SNAP benefits may not lawfully be exchanged for cash under any circumstances. The program is designed so that the total amount of each purchase is electronically transferred to the retailer’s designated bank account.
According to court documents, MAHMOOD worked at WB Trade Fair Grocery, located at 43 Willow Street in Waterbury. From November 2014 until June 2016, MAHMOOD and others illegally allowed customers to redeem their food stamp benefits for cash and other ineligible items.
Given the stock of eligible food items at the store, the number of registers and the customer amenities, it is estimated that WB Trade Fair Grocery could lawfully redeem at most between $120,000 to $240,000 per year in food stamp benefits. However, during this approximately 18-month period, food stamp redemptions at the store totaled approximately $3.2 million.
Judge Bryant ordered MAHMOOD to pay approximately $1.5 million in restitution.
MAHMOOD was arrested on August 18, 2016. On March 30, 2016, he pleaded guilty to one count of unlawful use of food stamp benefits and one count of conspiracy to commit food stamp fraud.
On April 7, 2017, Raul Carlos Monarca-Gonzalez, also an employee at WB Trade Fair Grocery, was sentenced to 30 months of imprisonment and restitution of approximately $1.5 million for his role in this scheme.
A third employee of the store who was involved in this scheme, Tahir Shahzad, also has pleaded guilty and is scheduled to be sentenced on July 31.
This matter was investigated by the U.S. Department of Agriculture, Office of Inspector General, and is being prosecuted by Assistant U.S. Attorneys Anastasia King and Neeraj Patel.
Washington Man Pleads Guilty to Defrauding Alaskans Out of Approximately $2.7 MillionRead the Press Release
Anchorage, Alaska – Acting U.S. Attorney Bryan Schroder announced that Floyd Jay Mann, Jr., 55, of Puyallup, Washington, pleaded guilty in Anchorage yesterday to all counts charged against him, to include 11 counts of wire fraud and 8 counts of money laundering, regarding a scheme to defraud Alaskans out of approximately $2.7 million. His wife, Cheryl Mann, 52, also of Puyallup, was convicted in Seattle on Friday, July 7, 2017, of one count of social security fraud.
According to Assistant U.S. Attorney Aunnie Steward, who prosecuted the case against Floyd Mann in the District of Alaska, Floyd Mann defrauded several Alaska residents of approximately $2.7 million by falsely leading the victims to believe that he was the recipient of a multimillion-dollar settlement from a class-action lawsuit with a pharmaceutical company. Mann told victims that if they helped to pay Mann’s medical bills and other lawsuit-related expenses, the victims would be paid back plus a substantial return on their money, but only after Mann’s multimillion-dollar settlement was released by the court. In fact, Mann did not use the victim’s money to pay medical bills. There was no lawsuit settlement, and Mann used the money he obtained from the victims to gamble at a casino, collecting over $1 million in jackpots while receiving need-based social security benefits.
According to Special Assistant U.S. Attorney Benjamin Diggs, who prosecuted the case against Floyd Mann’s wife, Cheryl Mann, in the Western District of Washington, during the course of Floyd Mann’s scheme, he and his wife Cheryl Mann and their son collected approximately $81,000 in need-based Supplemental Security Income benefits. Cheryl Mann was the designated payee for Floyd Mann and their son and responsible for reporting any changes in the household income or assets. During this time, Cheryl Mann won approximately $125,000 by gambling at a casino. That income, as well as the funds obtained by her husband, disqualified the Manns from the public assistance they received. At her sentencing on July 7, 2017, Cheryl Mann was ordered to pay $81,000 in restitution and serve three years of probation.
Floyd Mann is scheduled to be sentenced on Dec. 11, 2017, in Anchorage.
For Floyd Mann’s charges, the law provides for a maximum sentence of 20 years in prison and a $500,000 fine or both. Under federal sentencing statutes, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
The IRS Criminal Investigations, FBI, and Social Security Office of Inspector General, conducted the investigation in this case.
Violent Felon Sentenced to 29 Years in Federal Prison for Running Drug Empire from Georgia State PrisonRead the Press Release
BRUNSWICK, GA - Daniel Roger Alo, 46, a Georgia penal resident, was sentenced earlier this week by U. S. District Court Judge Lisa Godbey Wood to 29 years in federal prison for his role in running a drug trafficking ring from a Georgia prison cell that operated throughout the Southeast.
According to evidence presented during the guilty plea, sentencing and other hearings, Alo, while serving a life sentence in the Georgia Department of Corrections for armed robbery, aggravated assault and kidnapping, formed a drug trafficking organization that trafficked in pounds of crystalized methamphetamine. Alo recruited members from inside and outside prison, including members of the Ghost Face Gangsters, Bloods and Gangster Disciple gangs. Alo and members of his conspiracy used drones and corrupt guards to smuggle phones and other contraband inside prison, which were used to facilitate drug trafficking activities. Members of the conspiracy distributed large quantities of crystal meth throughout the Southeast. Following a 2015 sting operation in Brunswick, Georgia, law enforcement agents seized from Alo’s organization over 11 pounds of meth, 15 firearms, and over $600,000. Coconspirator and former Georgia lottery winner, Ronnie Music, purchased meth for Alo’s organization with some of the $3 million Music won playing the lottery. Music was previously sentenced to 21 years in federal prison for his role in the drug trafficking organization.
Alo’s criminal history is shocking. Almost 30 years ago, at age 17, Alo earned his first felony burglary conviction. He was placed on probation, and the next year he committed and was convicted of burglarizing sixteen other homes. At 19, Alo committed and was convicted of another felony burglary charge. At 23, he kidnapped a doctor, stole his vehicle, shot the doctor in the leg, and then ran him over in an automobile. He was convicted by a jury and sentenced to life in prison.
At his sentencing before Judge Wood, Alo explained that the “devil” tattoo that adorns his left shoulder serves as a reminder of the “markings of the high cost of low living.”
Acting United States Attorney James D. Durham said, “Even the bars of a state prison cell have not deterred Mr. Alo from committing horrendous crimes. From a federal prison cell far, far away, it appears Mr. Alo will now have most of the rest of his live to ponder the high cost of low living.”
ATF Resident Agent in Charge Timothy S. Graden, stated, “Daniel Alo was one part of a large criminal organization. He and others will now spend lengthy parts of their life behind bars because of their criminal activity. Criminal organizations and individuals that commit violent crime, take notice, you could be next. ATF will continue to work closely with other agencies to make communities a safer place.”
Alo was one of over 20 other defendants who were charged and convicted in this investigation. This case was investigated and prosecuted by the Organized Crime Drug Enforcement Task Force, which is comprised of federal and local law enforcement agencies. The case was investigated by the ATF, the DEA, the FBI, the United States Marshal Service, the GBI, the Glynn-Brunswick Narcotics Enforcement Team, the Wayne County Sheriff’s Office, the Ware County Sheriff’s Office, the Glynn County Police Department, the Glynn County Sheriff’s Office, the Haralson-Paulding Drug Task Force and the Virginia State Police. Assistant United States Attorneys E. Greg Gilluly, Jr. and Tania D. Groover prosecuted the case on behalf of the United States. For questions, please contact the U. S. Attorney’s Office at (912) 201-2522.
US v Neilson IndictmentRead the Press Release
Neilson IndictmentU.S. Attorney Charges NW Alabama Compounding Pharmacy Sales Representatives in Prescription Fraud ConspiracyRead the Press Release
BIRMINGHAM – The U.S. Attorney’s Office on Wednesday charged two sales representatives for a Haleyville, Ala.,-based compounding pharmacy for participating in a conspiracy to generate prescriptions and defraud health care insurers and prescription drug administrators out of tens of millions of dollars in 2015.
Acting U.S. Attorney Robert O. Posey, FBI Acting Special Agent in Charge David W. Archey, U.S. Postal Inspector in Charge, Houston Division, Adrian Gonzalez, U.S. Department of Health and Human Services, Office of Inspector General, Special Agent in Charge Derrick L. Jackson, Defense Criminal Investigative Service Special Agent in Charge John F. Khin, and Internal Revenue Service, Criminal Investigation, Acting Special Agent in Charge James E. Dorsey announced the charges as part of a nationwide Department of Justice Health Care Fraud Takedown.
Attorney General Jeff Sessions and Department of Health and Human Services Secretary Tom Price, M.D., earlier today announced the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts, including 115 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving about $1.3 billion in false billings. Of those charged, more than 120 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s nationwide arrests. In addition, HHS has initiated suspension actions against 295 providers, including doctors, nurses and pharmacists.
In the Northern District of Alabama, the U.S. Attorney’s Office filed separate informations charging KELLEY NORRIS, also known as KELLEY NORRIS-HARTLEY, 41, of Tuscaloosa, and BRIDGET McCUNE, 41, of Destin, Fla., with conspiracy to commit health care fraud, wire fraud and mail fraud. McCune’s information also charges her with conspiring to solicit and receive kickbacks in return for referring prescriptions under Medicare and TRICARE, a U.S. Department of Defense health care program, and with money laundering for spending proceeds of the crimes. Both women face various counts of health care fraud for submitting fraudulent prescription reimbursement claims to Blue Cross Blue Shield of Alabama.
In conjunction with the charges, prosecutors also filed plea agreements with Norris and McCune.
“In this case, a pharmacy used a marketing scheme that increased sales of expensive medications without regard for patient need or medical necessity,” Posey said. “Schemes like this defraud Medicare and other health insurance systems by pushing unnecessary medications and driving up the costs of health care.”
Norris and McCune both worked for Northside Pharmacy, an Alabama company doing business as Global Compounding Pharmacy. Global’s compounding and shipping facility was in Haleyville. The pharmacy did its prescription processing, billing and customer service at its “call center” in Clearwater, Fla.
Global hired sales representatives, including Norris and McCune, who were located in various states and were responsible for generating prescriptions from physicians and other prescribers. To bill insurance providers, including Blue Cross Blue Shield of Alabama, Medicare and TRICARE, for these prescriptions, Global contracted to enter the pharmacy networks of their third-party administrators, known as “pharmacy benefit managers” or “PBMs. These PBMs included Prime Therapeutics, Express Scripts Incorporated and CVS/Caremark.
The court documents describe a conspiracy at Global that centered on generating and billing PBMs for fraudulent, often high-reimbursement prescriptions. To generate prescriptions, Global hired sales representatives who were married or related to doctors and other prescribers. Global also encouraged sales representatives to volunteer at doctors’ offices where they would review patient files and push Global’s products to patients. Global executives also frequently instructed employees to obtain high-reimbursing prescriptions that Global would fill and bill for reimbursement. Each of the plea agreements describes a Global executive instructing sales representatives to obtain certain prescriptions and, shortly after, Norris and McCune obtained those prescriptions for themselves and their dependents.
When billing, Global engaged in various fraudulent practices, including splitting drug quantities to evade PBM billing safeguards and automatically refilling and billing for prescriptions regardless of patient need. Global routinely waived co-pays to encourage patients to accept unnecessary medications and refills.
As part of their plea agreements, Norris and McCune agree to forfeit money to the government as proceeds of illegal activity. Norris agrees to forfeit $287,698 and McCune $401,628.
Global paid the defendants a base salary plus a monthly commission for prescriptions that they obtained, according to court documents.
Norris worked out of Tuscaloosa as a sales representative for Global’s Alabama region from August 2014 to July 2016. She was closely related to an Alabama physician. That relative and a second physician, described in her plea agreement as a family friend, wrote a significant number of the prescriptions Norris obtained for Global to fill.
McCune began as a sales representative for Global’s Florida region in September 2014, working from Destin. Global promoted her to national field trainer in January 2015, but she also continued to function as a sales representative until she left the company in July 2016. McCune had a “close familial relationship” with a Florida physician, according to her plea agreement. “The overwhelming majority of prescriptions she obtained” were issued under her family member’s signature, her plea agreement states.
The charges against Norris and McCune follow charges brought by the U.S. Attorney’s Office in May against Global sales representative Robin Gary Lowry, 49, of Columbus, Miss. Lowry was charged with conspiracy to defraud BCBS of Alabama and Prime Therapeutics. She also faced three counts of health care fraud for submitting fraudulent claims for payment to BCBS of Alabama.
Lowry pleaded guilty to the charges in June. She is scheduled for sentencing Nov. 7.
FBI, U.S. Postal Inspection Service, U.S. Department of Health and Human Services Office of Inspector General, U.S. Defense Criminal Investigative Service and Internal Revenue Service, Criminal Investigation investigated the cases, which Assistant U.S. Attorneys Chinelo Dike-Minor and Nicole Grosnoff are prosecuting.
Two KC Men Indicted for Drug Trafficking as Part of National TakedownRead the Press Release
KANSAS CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced today that two Kansas City, Mo., men have been indicted, in separate cases, as part of a nationwide enforcement action related to the distribution of opioids and other dangerous narcotics.
Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced earlier today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts. Many of the defendants included in today’s national announcement are medical professionals, including doctors and nurses. In the two local cases, however, the defendants are not medical professionals but are charged with conduct related to the possession and distribution of controlled substances.
USA v. Toombs
William E. Toombs, Jr., also known as “Zorro” or “Big Z,” 59, of Kansas City, was charged in a 10-count indictment returned under seal by a federal grand jury in Kansas City, Mo., on June 29, 2017. That indictment was unsealed and made public upon Toombs’s arrest and initial court appearance on Tuesday, July 11, 2017.
The federal indictment charges Toombs with nine counts of possessing controlled substances with the intent to distribute. On June 19, 2015, Toombs allegedly possessed crack cocaine, Oxycodone, Morphine, Hydrocodone, Codeine, Alprazolam and Diazepam with the intent to distribute. On April 25, 2016, Toombs allegedly possessed heroin with the intent to distribute. On May 4, 2016, Toombs allegedly possessed Oxycodone, Methadone, Hydrocodone and Alprazolam with the intent to distribute.
Toombs is also charged with being a felon in possession of a firearm. Toombs, who has a prior felony conviction, allegedly possessed a Taurus .45 Long Colt/410 gauge revolver on June 19, 2015.
USA v. Cunningham
Josef Cunningham, Jr., also known as Carl Thomas, 31, of Kansas City, Mo., was charged in a six-count indictment returned by a federal grand jury on June 29, 2017.
The federal indictment charges Cunningham with one count of possessing Oxycodone between April 25 and June 10, 2015, with the intent to distribute. Cunningham is also charged with five counts of obtaining a controlled substance by fraud. Cunningham allegedly obtained Oxycodone and Codeine using fraudulent prescriptions.
Larson cautioned that the charges contained in these indictments are simply accusations, and not evidence of guilt.
These cases are being prosecuted by Assistant U.S. Attorney Trey Alford. They were investigated by the Kansas City, Mo., Police Department and the Department of Health and Human Services, Office of Inspector General.
Two Former Employees of House Member Indicted on Federal Charges in Cyberstalking CaseRead the Press Release
WASHINGTON – Two former staff employees of a member of the U.S. House of Representatives have been indicted following an investigation into the circulation of private, nude images and videos of the member and the member’s spouse, announced U.S. Attorney Channing D. Phillips and Matthew R. Verderosa, Chief of the United States Capitol Police.
Juan R. McCullum, 35, of Washington, D.C., was indicted by a grand jury on two counts of cyberstalking, and a co-worker, Dorene Browne-Louis, 45, of Upper Marlboro, Md., was indicted on two counts of obstruction of justice. The indictment, which was unsealed today, was returned on July 11, 2017, in the U.S. District Court for the District of Columbia.
According to the indictment, McCullum worked from April 2015 until June 2016 in the House member’s legislative office in Washington, D.C. Browne-Louis worked in the same office from January 2015 until April 2016.
The indictment alleges that, during the course of his employment, McCullum offered in March 2016 to assist the House member in repairing the member’s malfunctioning, password-protected cellular iPhone by taking the device to a local Apple store. According to the indictment, the House member provided McCullum with the device solely to have the iPhone repaired. McCullum was not given permission to take, copy, or distribute any of the contents of the iPhone. The iPhone contained the private, nude images and videos.
As alleged in the indictment, in July 2016, after McCullum left the House member’s staff, he engaged in a course of conduct that included creating a Hotmail account and a Facebook social media account, using a fictitious name, to distribute and post the private images and videos. Further, according to the indictment, he encouraged others on social media to redistribute the images and videos in the member’s congressional district. The indictment alleges that McCullum also sent text messages to Browne-Louis alerting her to his activities as early as July 2, 2016, as well as e-mail messages containing several of the images and videos.
On July 6, 2016, federal law enforcement initiated a criminal investigation into the unauthorized distribution and publication of the images and videos. The charges against Browne-Louis involve text messages from McCullum that she allegedly deleted from her cellular phone, as well as false, incomplete, and misleading statements that she allegedly made to law enforcement and a federal grand jury regarding her knowledge of the activities.
Browne-Louis made her first appearance today in the U.S. District Court for the District of Columbia. She pled not guilty to the charges and was released on personal recognizance pending a status hearing scheduled for July 19, 2017. McCullum’s first court appearance has not yet been scheduled.
The charge of cyberstalking carries a statutory maximum of five years in prison and potential financial penalties. The charge of obstruction of justice carries a statutory maximum of 20 years of incarceration and potential financial penalties.
An indictment is merely a formal charge that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty.
This case is being investigated by the United States Capitol Police. It is being prosecuted by Assistant U.S. Attorneys Veronica Jennings and Tejpal S. Chawla of the U.S. Attorney’s Office for the District of Columbia. Assistance was provided by former Assistant U.S. Attorney Natalia Medina, Criminal Investigator John Marsh, Paralegal Specialists Bianca Evans and Matthew Ruggiero, and Litigation Technology Specialists Leif Hickling, Thomas Royal and Paul Howell, all of the U.S. Attorney’s Office.
Two Executives Found Guilty of Promoting A Fraudulent Offshore Tax Shelter SchemeRead the Press Release
Tampa, Florida – U.S. District Judge Steven D. Merryday has found Duane Crithfield (70, Asheville, North Carolina) and Stephen P. Donaldson, Sr. (71, Tampa) guilty of one count of conspiracy to defraud the United States and two counts of willfully aiding the submission of a false and fraudulent income tax return. Crithfield’s and Donaldson’s sentencing hearings are scheduled for September 27 and 28, 2017, respectively. Each faces a maximum penalty of 11 years in federal prison.
Crithfield and Donaldson were initially indicted on May 2, 2013, for conspiracy to defraud the United States. A superseding indictment was returned on July 25, 2013, adding two substantive charges.
As alleged in the superseding indictment, from 2001 to at least March 2008, Crithfield, Donaldson, and others, through Foster & Dunhill, Offshore Trust Service, Fidelity Insurance Company (FIC), and Citadel Insurance Company (CIC) promoted, marketed, and implemented a fraudulent offshore tax strategy known as the Business Protection Plan (BPP). The fraudulent BPP strategy enabled the defendants' affluent clients to claim business expense deductions based on sham “BPP insurance premium” payments made to offshore entities FIC and CIC in amounts intended primarily to substantially reduce the clients' taxable income for a particular year.
According to the trial judge’s Order and evidence admitted during the bench trial, Crithfield and Donaldson conspired together, and with others, to create and promote the offshore BPP tax shelter strategy. The strategy, however, was nothing more than self-insurance and was devoid of any economic substance and the so‑called “BPP insurance premiums” were not based on actual business risks. After obtaining the benefit of a tax deduction on the client's corporate income tax return, the client would later receive approximately 83‑85% of the premium back. Thus, the premium amounts were not ordinary and necessary business expenses that were entitled to deductions under Section 162(a) of the Internal Revenue Code. Rather, they were merely sham expenditures and not properly deductible for U.S. income tax purposes on the respective businesses’ tax returns.
This case was investigated by the Internal Revenue Service – Criminal Investigation. It is being prosecuted by Assistant United States Attorneys Jay G. Trezevant and Megan K. Kistler.
Two Charged in Multi-Million Dollar Compounding Pharmacy Fraud SchemeRead the Press Release
Hattiesburg, Miss. – Jason May, 40, of Lamar County, Mississippi, and Gerald Jay Schaar, 46, of Biloxi, Mississippi, have each been charged by Criminal Information for their roles in a multi-million dollar compounding pharmacy health care fraud conspiracy, announced Acting U.S. Attorney Harold Brittain, FBI Special Agent in Charge Christopher Freeze, IRS-Criminal Investigation Special Agent in Charge Jerome R. McDuffie, and John F. Khin, Special Agent in Charge, Defense Criminal Investigative Service Southeast Field Office.
The charges were brought as a result of the largest ever national health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants in 41 federal districts across the country, targeting schemes which involved billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries.
May is charged with conspiracy to commit health care fraud and money laundering in connection with his role as co-owner and pharmacist in charge of Advantage Pharmacy, which received approximately $192 million in reimbursements from TRICARE and other health care benefit programs for compound topical creams. According to the Criminal Information, May selected formulas for the compound creams based on reimbursement rates as opposed to medical efficacy. In order to facilitate the scheme to defraud, May and Advantage Pharmacy either did not collect patient copayments for the compound topical creams or paid copayments on behalf of beneficiaries. As a co-owner of Advantage Pharmacy, May received a portion of the reimbursements associated with the fraudulently obtained compound creams and transferred certain of those proceeds from the fraud – in transactions greater than $10,000 - into a money market account held in his name.
Schaar is charged with conspiracy to commit health care fraud for his role in a fraudulent scheme in which he, acting as a marketer for a pharmacy located in Lamar County, solicited physicians and other medical professionals to write prescriptions without seeing patients for compound topical creams dispensed by the pharmacy. According to the Criminal Information, Schaar, together with others, later falsified patient records to make it seem as though medical professionals had examined the patients who received prescriptions for the compound creams. In total, the pharmacy received $2.3 million in reimbursements for the prescriptions solicited by Schaar.
Jason May and Gerald Jay Schaar are both scheduled to enter guilty pleas before U.S. District Judge Keith Starrett on July 25, 2017, at 1:30 p.m.
This case is being prosecuted by Department of Justice trial attorneys Dustin Davis and Katherine Payerle and Assistant U.S. Attorney Mary Helen Wall. The case is being investigated by the FBI, IRS-Criminal Investigation, Defense Criminal Investigative Service, Health and Human Services Office of Inspector General, Mississippi Bureau of Narcotics, and other government agencies.
Two Austin Psychologists, Owners of Psychological A.R.T.S., P.C., and a Patient Recruiter Indicted for Federal Health Care CrimesRead the Press Release
As part of the largest coordinated Health Care Fraud enforcement action to date, Federal and state authorities arrested two Austin psychologists who own and operate Psychological A.R.T.S., P.C., announced United States Attorney Richard L. Durbin, Jr., FBI Special Agent in Charge Christopher Combs, San Antonio Division, and Texas Attorney General Ken Paxton.
An indictment returned by a federal grand jury in Austin charges 72-year-old Dr. William Joseph Dubin and his son, 32-year-old Dr. David Fox Dubin, with one count of conspiracy to violate the federal anti-kickback law; five counts of paying illegal kickbacks; one count of conspiracy to commit health care fraud; seven counts of health care fraud and aiding and abetting health care fraud; and, six counts of aggravated identity theft, and aiding and abetting aggravated identity theft. A third defendant in this indictment, 67-year-old patient recruiter Glen Elwood McKenzie, Jr., of Cedar Park, TX, is charged with one count of conspiracy to violate the federal anti-kickback law and five counts of receiving illegal kickbacks.
According to the indictment, Dr. William Dubin, and Dr. David Dubin, are licensed psychologists who operated Psychological A.R.T.S. in Austin. McKenzie was the President of the Board of Directors of an emergency shelter house located approximately eighty miles from Austin that provided temporary shelter for crisis intervention and mental health services to children and youth ages 5 to 17 who had been removed from their homes by the Texas Department of Family and Protective Services. The indictment alleges that, in exchange for kickbacks paid to him, McKenzie used his position at the emergency shelter and his contacts with other similar shelters to refer children and youth to Psychological A.R.T.S., for comprehensive mental health assessments. From January 2011 to June 2015, Dr. William Dubin and Dr. David Dubin allegedly caused fraudulent billings totaling approximately $300,000 to be submitted to the Texas Medicaid program and the Texas Vocational Rehabilitation Services program for various psychological services. Upon receipt of payment for their services, the doctors paid McKenzie a 10-percent kickback from the money paid to Psychological A.R.T.S.
According to the allegations of the indictment, Dr. William Dubin, and Dr. David Dubin directed students and interns, who were unlicensed and unsupervised, to conduct psychiatric diagnostic evaluations of the children and youth referred to them by McKenzie. The students and interns then prepared psychological evaluation reports, which included the student’s diagnoses of the psychological condition of each child and youth, the student’s impressions of the risk of each child and youth for future obstructive and disruptive behaviors, and the student’s recommendations for future treatment. The indictment alleges that Dr. William Dubin, and Dr. David Dubin, then billed or caused others to send bills to Medicaid that falsely claimed that Dr. William Dubin had done the work that was actually done by the unlicensed students and interns. The Medicaid rules expressly prohibited psychologists from billing for services performed by students and interns. The Medicaid rules allow a psychologist to bill, at a reduced fee, for services provided by a supervised licensed psychological associate. The reduced fee is seventy percent of the fee paid for work performed by the licensed psychologist.
The indictment alleges that Dr. William Dubin, and Dr. David Dubin also directed unsupervised licensed psychological associates to prepare psychiatric diagnostic evaluations of the children and youth referred to them by McKenzie. Dr. William Dubin and Dr. David Dubin then billed, or caused others to send bills, Medicaid falsely claiming that Dr. William Dubin had done work that was actually done by the associates. This resulted in a larger payment from Medicaid and a larger percentage of profit for Psychological A.R.T.S., Dr. William Dubin and Dr. David Dubin.
Upon conviction, each count related to illegal kickbacks calls for up to five years in federal prison; each count related to Health Care Fraud calls for up to ten years in federal prison; and, each count related to aggravated identity theft calls for up to two years in federal prison.
This indictment resulted from an investigation conducted by special agents with the Federal Bureau of Investigation together with investigators from the Texas Attorney General’s Medicaid Fraud Control Unit. Special Assistant United States Attorney Rex Beasley is prosecuting this case on behalf of the Government.
An indictment is merely a charge and should not be considered as evidence of guilt. The defendants are presumed innocent until proven guilty in a court of law.
Two Atlantic County Men Sentenced for Their Roles in Large-Scale Crack Cocaine Trafficking ConspiracyRead the Press Release
CAMDEN, N.J. – Two Atlantic County, New Jersey, men were each given multi-year prison sentences for their participation in a nearly three-year conspiracy to distribute cocaine and crack cocaine in the Atlantic City, New Jersey area, Acting U.S. Attorney William E. Fitzpatrick announced today.
John Wellman, 41, of Atlantic City, New Jersey, was sentenced today to 130 months in prison. Ronald Douglas Byrd, 51, of Pleasantville, New Jersey, was sentenced July 11, 2017 to 96 months in prison. Both defendants previously pleaded guilty to Count One of an indictment charging them with conspiracy to distribute crack cocaine. U.S. District Judge Jerome B. Simandle imposed both sentences in Camden federal court.
According to documents filed in this case and statements made in court:
From February 2012 through Dec. 10, 2014, Byrd, Wellman and others engaged in a drug trafficking conspiracy through which Byrd distributed more than one kilogram of crack cocaine and Wellman distributed more than 280 grams of crack cocaine. Members of the conspiracy used Byrd’s Pleasantville residence and at least two other residences in Pleasantville and Absecon, New Jersey – including one that was rented by Wellman – to store and package cocaine and crack cocaine.
In addition to the prison terms, Judge Simandle sentenced both defendants to five years of supervised release.
The U.S Attorney’s Office charged a total of 12 individuals for their participation in this drug trafficking conspiracy. All of those charged, with the exception of one defendant who remains a fugitive, have been convicted of their roles in the drug trafficking conspiracy or related charges.
Acting U.S. Attorney Fitzpatrick credited special agents of the FBI’s Newark Division, Atlantic City Resident Agency, under the direction of Special Agent in Charge Timothy Gallagher in Newark; the Drug Enforcement Administration’s Newark Division, under the direction of Special Agent in Charge Carl J. Kotowski; the Atlantic County Prosecutor’s Office, under the direction of Acting Prosecutor Diane M. Ruberton; and the Atlantic City Police Department, under the direction of Police Chief Henry White, with the investigation leading to these convictions.
He also thanked the N.J. State Police; the Bureau of Alcohol, Tobacco and Firearms; U.S. Immigration and Customs Enforcement (ICE)-Homeland Security Investigation (HSI); U.S. Postal Inspection Service; Cumberland County Sheriff’s Office and the Ventnor, Northfield and Millville police departments for their assistance.
The government is represented by Assistant U.S. Attorneys Diana Vondra Carrig and Howard Wiener of the U.S. Attorney’s Office Criminal Division in Camden.
Defense counsel:
Byrd: Michael Huff Esq., Philadelphia
Wellman: John F. Renner Esq., Marlton, New Jersey
Twenty-Four Charged in Arkansas as Part of Largest Nationwide Health Care Fraud Enforcement Action in Department of Justice HistoryRead the Press Release
WASHINGTON—Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts—including the Eastern District of Arkansas. Among the defendants were 115 doctors, nurses and other licensed medical professionals, all alleged to have participated in health care fraud schemes involving approximately $1.3 billion in false billings. Of those charged, over 120 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS has initiated suspension actions against 295 providers, including doctors, nurses and pharmacists.
In Arkansas, Patrick C. Harris, Acting United States Attorney for the Eastern District of Arkansas and Stephen G. Azzam, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) New Orleans Field Division, who oversees the DEAs’ Little Rock District Office, announced the unsealing of three indictments charging 24 defendants in schemes intended to divert pharmaceutical pills to the streets.
“The abuse of prescription medication, particularly opioids, is one of the largest health and crime problems Arkansas is facing,” Harris said. “This epidemic must be attacked on multiple fronts—by stopping the criminal doctors and medical professionals from writing medically unnecessary prescriptions, and by preventing the common drug dealers from diverting these pills to the hands of other addicts and dealers, either by writing fraudulent prescriptions or stealing dangerous drugs from pharmacies. The defendants in the cases announced by my office today illegally put hundreds of thousands of pills on the streets, and they must be stopped. The Eastern District of Arkansas joins the Justice Department’s resolve to aggressively pursue and prosecute all manner of health care and prescription pill crime.”
In the first Arkansas case, 4:16-cr-00278-KGB, charges stem from an early-morning burglary on February 25, 2016, of the Health-Way pharmacy in Beebe. On December 7, 2016, the four suspects in the burglary, Albert Ray Ferguson, Jr., Thristian Davante Duplechin, Corry Wayne Cornett, and Cory Jermaine Lewis, all from Houston, Texas, were charged with conspiracy to break in a business premises registered with the DEA to dispense controlled substances.
Following the arrest of the initial four defendants, an ongoing investigation by the DEA Tactical Diversion Squad uncovered a network of individuals who were traveling between states to commit pharmacy burglaries. During the investigation, the DEA canvased law enforcement agencies from nearby states for similar pharmacy burglaries, and developed evidence linking eight additional defendants to the defendants from Beebe. Physical and electronic evidence from numerous burglaries in several states, including Arkansas, Nebraska, Indiana, Illinois, Iowa, Kentucky, Virginia, and Texas, showed that the individuals involved were members of local street gangs in the Houston area.
These gangs stole more than 120,000 Schedule II pills during these burglaries, with a street value of at least $1,050,000. On July 6, 2017, a superseding indictment was returned in the Eastern District of Arkansas adding an additional count charging the other gang members with conspiracy to possess with intent to distribute Schedule II, III and IV controlled substances.
In case 4:17-cr-176-BSM, a federal Grand Jury charged Erik Edson Turner and two others with conspiracy to possess with intent to distribute Schedule II controlled substances without an effective prescription. Beginning in 2015, Turner fabricated prescriptions to fraudulently obtain oxycodone 30 mg tablets from pharmacies. Turner sold some of the oxycodone to Spencer Daniel King, who eventually joined Turner in the conspiracy to obtain the drug by using fraudulent prescriptions. In 2016, Michael Joseph “Joey” Carbonero was recruited by Turner to assist in the scheme. Over the course of two years, Turner and individuals working on his behalf obtained thousands of oxycodone pills with a street value in excess of $150,000. These cases are being prosecuted by Assistant United States Attorney Anne E. Gardner.
In the third case, 4:17-cr-00184 BSM, the DEA Tactical Diversion squad uncovered a sophisticated prescription-forgery operation headed by Michael McClellan, 32, of North Little Rock. In this scheme, McClellan created fraudulent prescriptions using computer templates that either McClellan or other individuals then filled at local pharmacies.
The investigation into McClellan’s operation began following a break-in at McClellan’s home. When police arrived, they discovered numerous pieces of drug paraphernalia and other indicators of illegal activity. The DEA obtained a search warrant for the computers in McClellan’s home, and an analysis of these computers revealed the extent of the operation.
Agents also located drug ledgers in McClellan’s home that, coupled with the information from the computers, revealed the names of nearly 100 people whose identification was used to obtain fraudulent prescriptions. All told, since the conspiracy began in 2012, more than 74,000 pills were obtained from these forged prescriptions. McClellan and the eight other main individuals in the organization are charged with conspiracy to possession with intent to distribute Schedule II controlled substances. This cases is being prosecuted by Assistant United States Attorney Chris Givens.
“The diversion and abuse of prescription drugs pose a significant threat to the health and safety of our communities across the nation, including here in Arkansas,” Special Agent in Charge Azzam said. “Today, more people die from opioid-related causes than from gun homicides. This unprecedented collaboration between all law enforcement agencies represented in this region exemplifies the continuing unified goal of keeping our neighborhoods safe and secure. The indictment of these individuals will undoubtedly convey a strong and unified message to those criminals who continue to engage in activities, such as these pharmacy burglaries, threatening the safety of our citizens.”
Nationwide, today’s enforcement actions were led and coordinated by the Criminal Division, Fraud Section’s Health Care Fraud Unit in conjunction with its Medicare Fraud Strike Force (MFSF) partners, a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, and State Medicaid Fraud Control Units.
The charges announced today aggressively target schemes billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics, a particular focus for the Department. According to the CDC, approximately 91 Americans die every day of an opioid related overdose.
“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” Attorney General Sessions said. “Amazingly, some have made their practices into multimillion dollar criminal enterprises. They seem oblivious to the disastrous consequences of their greed. Their actions not only enrich themselves often at the expense of taxpayers but also feed addictions and cause addictions to start. The consequences are real: emergency rooms, jail cells, futures lost, and graveyards. While today is a historic day, the Department's work is not finished. In fact, it is just beginning. We will continue to find, arrest, prosecute, convict, and incarcerate fraudsters and drug dealers wherever they are.”
“Healthcare fraud is not only a criminal act that costs billions of taxpayer dollars - it is an affront to all Americans who rely on our national healthcare programs for access to critical healthcare services and a violation of trust,” Secretary Price said. “The United States is home to the world’s best medical professionals, but their ability to provide affordable, high-quality care to their patients is jeopardized every time a criminal commits healthcare fraud. That is why this Administration is committed to bringing these criminals to justice, as President Trump demonstrated in his 2017 budget request calling for a new $70 million investment in the Health Care Fraud and Abuse Control Program. The historic results of this year’s national takedown represent significant progress toward protecting the integrity and sustainability of Medicare and Medicaid, which we will continue to build upon in the years to come.”
According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare, Medicaid and TRICARE for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed.
The number of medical professionals charged is particularly significant, because virtually every health care fraud scheme requires a corrupt medical professional to be involved in order for Medicare or Medicaid to pay the fraudulent claims. Aggressively pursuing corrupt medical professionals not only has a deterrent effect on other medical professionals, but also ensures that their licenses can no longer be used to bilk the system.
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
A complaint, information, or indictment is merely an allegation, and all defendants are presumed innocent unless and until proven guilty.
Additional documents related to this announcement are available here: https://www.justice.gov/opa/documents-and-resources-july-13-2017.
16-278 Indictment 17-176 IndictmentThree Sentenced for Roles in Healthcare ConspiracyRead the Press Release
Abingdon, VIRGINIA – Three Bristol, Virginia residents, who were previously convicted of healthcare fraud, were sentenced today in Federal Court, Acting United States Attorney Rick A. Mountcastle, Virginia Attorney General Mark R. Herring and Nick DiGiulio, Special Agent in Charge, Philadelphia Regional Office for U.S. Health and Human Services - Office of Inspector General announced.
Deborah Branch, 65, was sentenced today to 72 months in federal prison. In a pair of separate hearings today, Bryan Harr, 41, was sentenced to 48 months in federal prison and Melissa Harr, 49, was sentenced to 48 months in federal prison. The three previously pled guilty to federal healthcare conspiracy charges. Branch additionally pled guilty to wire fraud.
“This case shows that fraud committed against our federal and state health care benefit programs is more than just simple theft of government money, there is a sinister side to the greed that fuels the criminal acts of defendants like these,” Acting United States Attorney Mountcastle said today. “This type of greed brings physical and emotional devastation upon the innocent, vulnerable victims for whom essential services are denied, simply to satiate the greed of these defendants. In this case, children were forced to live in filth in a room without electricity. The United States Attorney’s Office, and our partners at the Virginia Attorney General’s Office, Health and Human Services and others, will continue to aggressively pursue fraudsters, like Branch and the Harrs, whose criminal actions bring harm to vulnerable victims.”
“Anyone who diverts public funds for their private benefit is stealing from all of us and undermining an important system that provides thousands of Virginians with needed medical services,” said Attorney General Mark Herring. “A situation where people steal that money at the expense of their own disabled child is even more horrifying and unacceptable, and I’m glad to see these criminals brought to justice today. My award-winning Medicaid Fraud Unit and I will be relentless in holding accountable those who try to take advantage of our health care system.”
“It is shocking to imagine parents who would for many years neglect their disabled child and allow him to suffer horribly while they worked to steal taxpayer money meant to pay for the child’s much needed care,” said Special Agent in Charge Nick DiGiulio of the United States Department of Health and Human Services, Office of Inspector General. “We are satisfied that justice was served today, and we will continue to work with our law enforcement partners to jail heartless criminals who prey on beneficiaries and our health care system.”
According to evidence presented at previous hearings, Bryan Harr Sr. and his wife, Melissa Harr, hired Branch to work with one of their children, who suffers from intellectual and physical disabilities and who qualifies for services paid for by Virginia Medicaid, including personal assistance, respite and residential support services. These services are available to qualified individuals pursuant to Virginia Medicaid’s Intellectual Disability (ID) waiver program. The ID waiver program is designed to provide critical services that enable a recipient to remain at home instead of being placed in an institution. Recipients or their guardians are permitted to hire workers of their own choosing to provide these services, which are paid for by Virginia Medicaid. Branch was paid through two different Virginia Medicaid contractors: Public Partnerships, LLC and ResCare (formerly known as Creative Family Solutions).
From January 2010 until September 2015, Branch, with the knowledge of Melissa Harr and Bryan Harr Sr., submitted time sheets claiming Branch was providing services for Harr’s disabled son when she was not. In exchange for assisting Branch in being paid for work she did not do, Branch paid the Harrs approximately $200 every two weeks. Virginia Medicaid’s Department of Medical Assistance Services (DMAS) paid out $350,641.02 to the contractors based on these time sheets, of which $207,854.43 was paid to Branch. More importantly, the Harr’s disabled son did not receive the services he legitimately needed pursuant to the ID waiver program.
The investigation of the case was conducted by the Medicaid Fraud Control Unit of the Virginia Attorney General’s Office, the U.S. Department of Health and Human Services Office of Inspector General, and the Bristol Virginia Police Department. Special Assistant United States Attorney Janine M. Myatt, a Virginia Assistant Attorney General, prosecuted the case for the United States.
Three Doctors, A Chiropractor, Three Therapists and Medical Company Owners Arrested in Brooklyn as Part of National Health Care Fraud TakedownRead the Press Release
Ten individuals, including three doctors, a chiropractor, three licensed physical and occupational therapists and two medical company owners, have been charged for their alleged participation in multiple schemes that fraudulently billed the Medicare and Medicaid programs more than $125 million. The charges filed in federal court in Brooklyn, New York are part of a nationwide health care fraud takedown led by the Medicare Fraud Strike Force, which resulted in criminal charges against 412 individuals for their alleged participation in health care fraud schemes involving approximately $1.3 billion in fraudulent claims.
The Brooklyn and Queens cases were announced by Bridget M. Rohde, Acting United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Special Agent in Charge Scott Lampert of the U.S. Department of Health and Human Services - Office of Inspector General (HHS-OIG), New York Regional Office, James D. Robnett, Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI), and Medicaid Inspector General Dennis Rosen of New York State Office of Medicaid Inspector General (OMIG). The results of the nationwide takedown were announced today by Attorney General Jeff Sessions, Department of Health and Human Services (HHS) Secretary Tom Price, M.D., Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting FBI Director Andrew McCabe, Acting Drug Enforcement Administration (DEA) Administrator Chuck Rosenberg, Inspector General Daniel Levinson of the HHS Office of Inspector General (OIG), IRS-Criminal Investigations Chief Don Fort, Centers for Medicare and Medicaid Services Administrator Seema Verma, and Deputy Director Kelly P. Mayo of the Defense Criminal Investigative Service (DCIS).
“As alleged, the defendants charged in the Eastern District of New York as part of this national takedown took advantage of programs designed to provide essential healthcare for the elderly and the needy. Doctors, medical professionals and others who defraud Medicare and Medicaid and pay illegal kickbacks to line their pockets at the taxpayers’ expense are on notice that they will be investigated and prosecuted,” stated Acting United States Attorney Rohde. Ms. Rohde extended her grateful appreciation to the U.S. Office of Personnel Management, Office of Inspector General (OPM-OIG), U.S. Immigration and Customs Enforcement, Homeland Security Investigations (HSI), the Drug Enforcement Administration (DEA), the New York City Police Department (NYPD), the New York Attorney General’s Medicaid Fraud Control Unit (MFCU), the New York City Human Resources Administration and the New York City Health and Hospitals Corporation, Office of Inspector General, for their assistance in the investigations in this district.
“Bhambhani’s alleged acts of illegally paying for patient referrals and submitting a plethora of false million-dollar claims to Medicare and Medicaid were aimed towards selfish gain,” FBI Assistant Director-in-Charge Sweeney Jr. stated. “Crimes of this nature not only stand to compromise government programs created to assist those in need, but also the confidence of those who put great trust in doctors and medical professionals. It goes without saying that to betray this trust is utterly unethical.”
“Being a health care provider in the Medicare and Medicaid programs is a privilege, not a right. When fraudsters rip off scarce taxpayer funds meant to pay for legitimate health care services, they undermine these vital programs and affect the millions of Americans who rely on them,” said Special Agent in Charge Lampert of HHS-OIG. "Our agency, working closely with our law enforcement partners, will continue root out fraudulent schemes and hold criminals accountable in order to protect the integrity of our nation’s federally funded health care system.”
“Healthcare Fraud is not a victimless crime,” stated IRS-Criminal Investigation Special Agent-in-Charge Robnett. “We all pay when others swindle the United States overnment. With both law enforcement and financial investigation expertise, our agents are uniquely qualified to assist our law enforcement partners in these cases, by following the money when investigating these allegations.”
“Individuals who commit Medicaid fraud prey on the most vulnerable New Yorkers, and the impacts - fewer health care resources and waste of taxpayer dollars - affect all of us,” said OMIG Inspector General Rosen. “My office will continue to work closely with our partners at the federal and state level to root out fraud and hold wrongdoers fully accountable.”
The schemes charged in the Eastern District of New York, detailed in four indictments and two criminal complaints, are as follows:
Ghanshyam Bhambhani: A criminal complaint charges Ghanshyam Bhambhani, a Queens cardiologist, with violating the Anti-Kickback Statute by paying other physicians for patient referrals to his practice. A search warrant was also executed at his medical office in Ozone Park. According to the complaint, physicians who worked with the doctor covertly recorded him discussing paying for patient referrals. Bhambhani, along with other employees of his practice, submitted over $3.7 million in claims to Medicare Part B, and Bhambhani is listed as the attending physician for over $7.4 million in claims submitted to Medicare Part A. This case is being prosecuted by Assistant United States Attorney Erin Argo and Senior Litigation Counsel Patricia Notopoulos of the U.S. Attorney’s Office for the Eastern District of New York. Bhambani was arrested today and he is expected to be arraigned this afternoon before United States Magistrate Judge Robert Levy at the federal courthouse in Brooklyn, New York on July 13, 2017.
United States v. Wael Bakry, et al.: The indictment charges five health care professionals for their role in a wide-ranging health care fraud conspiracy in Brooklyn and Queens that billed the Medicare program approximately $100 million. The defendants—Wael Bakry, a physical therapist, Abraham Demoz, a physician, Victor Genkin, an occupational therapist, Mayura Kanekar, an occupational therapist, and Alexander Khavash, a chiropractor—were charged with conspiring to commit health care and wire fraud and with related tax charges. According to the indictment, the defendants paid illegal kickbacks for the referral of patients to their clinics who, in turn, subjected themselves to purported physical and occupational therapy and other services. This case is being prosecuted by Acting Assistant Chief A. Brendan Stewart and Trial Attorney Richard A. Powers of the Criminal Division’s Fraud Section. Bakry, Demoz, and Kanekar were arrested and arraigned before States Magistrate Judge Vera M. Scanlon at the federal courthouse in Brooklyn, New York on July 10, 2017. The case has been assigned to States District Judge Pamela K. Chen.
Xiaoliang Zhang: A criminal complaint charges Xiaoliang Zhang, a licensed physician specializing in rehabilitation medicine, with health care fraud for submitting $27 million worth of claims to Medicare and Medicaid for physical therapy services even though such services were not medically necessary, often not provided, and otherwise did not qualify for reimbursement. Search warrants were executed by agents from the FBI and HHS-OIG at two of Zhang's medical clinic locations, which he operated under the name Elmhurst United Medical, P.C. As described in the complaint, Zhang ordered his physical therapists to bill Medicare and Medicaid for administering treatments to patients that were not rendered. This case is being prosecuted by Senior Litigation Counsel Patricia Notopoulos of the U.S. Attorney’s Office for the Eastern District of New York. Zhang was arrested and arraigned before United States Magistrate Judge Robert M. Levy at the federal courthouse in Brooklyn, New York on July 12, 2017.
Svetlana Shargorodskaya: The indictment charges Svetlana Shargorodskaya, the owner of a medical diagnostic testing company, LUVR Diagnostic Services, with health care fraud, false claims, and conspiracy to receive and pay kickbacks. As set forth in the indictment, Shargorodskaya, through LUVR, submitted false claims to various health care benefit programs, including Medicare, and paid patients to receive medically unnecessary services. LUVR fraudulently billed Medicare and insurance companies for more than $13 million in diagnostic testing services. This case is being prosecuted by Trial Attorneys Debra Jaroslawicz and Richard A. Powers of the Criminal Division’s Fraud Section. Shargorodskaya was arrested and arraigned before United States Magistrate Judge Robert M. Levy at the federal courthouse in Brooklyn, New York on July 12, 2017. The case has been assigned to United States District Judge Margo K. Brodie.
Suzanna Meliksetyan: The indictment charges Suzanna Meliksetyan with conspiracy to commit health care fraud, health care fraud, and false statements relating to health care matters for her role in a scheme to defraud Healthfirst, a non-profit, New York-based health maintenance organization that administered Medicare Advantage plans and New York Medicaid Managed Care plans for participating members. As described in the indictment, Meliksetyan and others impersonated representatives of approved providers in order to get approval for the submission of fraudulent claims for durable medical equipment. In total, the scheme resulted in the submission of more than $12 million in fraudulent claims and the payment of more than $5 million for those claims. This case is being prosecuted by Trial Attorney Andrew Estes of the Criminal Division’s Fraud Section. Meliksetyan was arrested and arraigned before United States Magistrate Judge Timothy J. Sullivan at the federal courthouse in Greenbelt, Maryland on July 11, 2017. The case has been assigned to United States District Judge Roslynn R. Mauskopf.
Vadim Alekseyev: The indictment charges Vadim Alekseyev, who owned and operated a number of shell companies in furtherance of a health care fraud and kickback scheme, with conspiracy to commit money laundering and conspiracy to obstruct the lawful functions of the Internal Revenue Service. As described in the indictment, Alekseyev and his co-conspirators filled multiple Brooklyn-area clinics, which purported to provide physical and occupational therapy to Medicare and Medicaid beneficiaries, with patients by paying bribes and kickbacks to beneficiaries and to Brooklyn-area ambulance drivers, who provided patients to be subjected to medically unnecessary treatment at the clinics. Through the clinics in which Alekseyev was involved, he and his co-conspirators submitted claims for over $40 million in purported therapy sessions in return for which Medicare and Medicare paid the clinics over $11 million. This case is being prosecuted by Trial Attorneys Sarah Wilson and Richard A. Powers of the Criminal Division’s Fraud Section.
The charges in the indictments and complaints are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
The Defendants:
Ghanshyam Bhambhani
Age: 52Queens, NY
EDNY Docket No. 17-M-604
WAEL BAKRY
Age: 45
Staten Island, NY
Dr. Abraham Demoz
Age: 57
Oceanside, NY
Victor Genkin
Age: 48
Brooklyn, NY
Mayura Kanekar
Age: 42
Bayside, NY
Alexander Khavash
Age: 40
Parkland, FL
EDNY Docket No. 17-CR-353
XIAOLIANG ZHANG
Age: 53
Brooklyn, NY
EDNY Docket No. 17-M-618
Svetlana Shargorodskaya
Age: 47
Staten Island, NY
EDNY Docket No. 17-CR-358
Suzanna Meliksetyan
Age: 28
Montgomery Village, MD
EDNY Docket No. 17-CR-351
Vadim Alekseyev
Age: 33
Brooklyn, NY
EDNY Docket No. 17-CR-336
Three Arrested in the Fort Wayne Area as Part of the National Health Care Fraud TakedownRead the Press Release
HAMMOND- Acting United States Attorney Clifford D. Johnson announced today that a federal grand jury returned a ten -count indictment against Fort Wayne physician Dr. James E. Ranochak and two Fort Wayne area pharmacists, Brent A. Losier and Charles N. Ringger.
The indictment charges Ranochak, Losier and Ringger with conspiring to illegally distribute and dispense controlled substances (Methadone, Hydrocodone and Testosterone) outside the scope of professional practice and not for legitimate medical purpose. The three defendants also face eight separate counts of distributing and dispensing controlled substances to specific patients outside the scope of professional practice and not for legitimate medical purpose. Finally, all three defendants are charged in a health care fraud conspiracy aimed at defrauding the Indiana Medicaid program through the submission of thousands of dollars in fraudulent claims for medically unnecessary drugs and non-emergency supplies of controlled drugs issued to patients without the patients actually being seen by a physician.
The United States Attorney's Office emphasized that an Indictment is merely an allegation and that all persons charged are presumed innocent until and unless proven guilty in court.
If convicted in court, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
This case was investigated by the Drug Enforcement Administration, the Food and Drug Administration, the Indiana State Police and the Indiana Office of the Attorney General Medicaid Fraud Control Unit. The case is being prosecuted by Assistant United States Attorney Diane L. Berkowitz.
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Ten Indicted in Dismantling of Plattsburgh Heroin Distribution RingRead the Press Release
PLATTSBURGH, NEW YORK – Ten people have been indicted for their involvement in a heroin distribution ring operating in the Plattsburgh area.
The announcement was made by Acting United States Attorney Grant C. Jaquith; Special Agent in Charge James J. Hunt, New York Division, U.S. Drug Enforcement Administration (DEA); and Clinton County Sheriff David Favro.
Two indictments charge the following people with conspiracy to distribute heroin:
- Kyle Touchstone, age 29, of Plattsburgh;
- Melissa Kusalonis, a.k.a. “Mel,” “Liss,” age 35, of Plattsburgh;
- Jimolo Coates, a.k.a. “Lo,” “Marlo,” “Brodie,” age 24, of Annapolis, Maryland;
- Tynaejah Thompson, a.k.a. “Naee,” age 19, of Annapolis, Maryland;
- Kiara Scott, age 28, of Annapolis, Maryland;
- Anthony DeFilippo, a.k.a “Flip,” age 35, of Schenectady, New York;
- Charles Adams, a.k.a. “Chuck, age 31, of Peru, New York;
- Travynn Ippolito, a.k.a “Trav,” age 29, of Plattsburgh;
- Luke Kiroy, age 32, of Saranac, New York; and
- Danielle Conners, age 31, of Plattsburgh.
The charges in the indictments are merely accusations. The defendants are presumed innocent until proven guilty.
According to the indictments and criminal complaints previously filed in the case, from June 2016 through May 2017, the defendants transported heroin from Annapolis, Maryland, and Schenectady, New York, and sold it in the Plattsburgh area. Kiroy, a New York State Corrections Officer, was working at Clinton Correctional Facility in Dannemora, New York, prior to his arrest on June 20, 2017.
Acting United States Attorney Grant C. Jaquith stated: “The deadly effects of heroin are felt in our communities, but the groups profiting from spreading this poison are often found elsewhere. As this case illustrates, we are committed to collaboration with federal, state, and local law enforcement agencies to combat the scourge of heroin in our area, and to pursue and dismantle drug trafficking organizations wherever they may be found.”
DEA Special Agent in Charge James Hunt stated: “Heroin has been a plague to public health causing record numbers of overdoses in New York State. This investigation highlights law enforcement’s commitment to dismantling opioid trafficking organizations responsible for fueling addiction and death in neighborhoods across the nation.”
Clinton County Sheriff David Favro stated: “The result of this lengthy investigation will remove elements from our community that have proven to be life-threatening. Let the message resonate to all that the Clinton County Sheriff will continue to partner with local, state, and federal agencies to provide a safe and healthy community for our residents and guests.”
If convicted, Touchstone and Coates would each face at least 10 years and up to life in prison. Kusalonis, Thompson, and Adams would each face at least 5 years and up to 40 years in prison. DeFlippo, Ippolito, Conners, Kiroy, and Scott would each face up to 20 years in prison. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
The indictments are the result of an investigation led by the DEA Task Force in Plattsburgh, which consists of law enforcement officers from the DEA, Homeland Security Investigations, United States Border Patrol, New York State Police, Clinton County Sherriff’s Office, Essex County Sheriff’s Office, and the Plattsburgh Police Department. The New York State Department of Corrections and Community Supervision also assisted in the investigation.
The case is being prosecuted by Assistant U.S. Attorneys Cyrus P.W. Rieck and Katherine Kopita.
Stockton Woman Sentenced to 3 Years in Prison for Bank Fraud, Mail Fraud and Aggravated Identity TheftRead the Press Release
SACRAMENTO, Calif. — Patricia Ramona Vasquez, 37, of Stockton, was sentenced today to three years in prison and ordered to pay $30,971 in restitution by U.S. District Judge Morrison C. England Jr. for bank fraud, aggravated identity theft, and mail fraud, U.S. Attorney Phillip A. Talbert announced.
San Francisco Division Inspector in Charge Rafael Nunez of the U.S. Postal Inspection Service stated, “Postal Inspectors work closely with the U.S. Attorney’s Office and our partners in law enforcement to arrest and prosecute those individuals responsible for mail fraud and identity theft crimes committed against the public.”
According to court documents, between February 3, 2016, and July 7, 2016, Vasquez targeted a woman with the same last name and obtained her mail to obtain documents and information to steal her identity. Vasquez created an email address for her new identity. On April 4, 2016, Vasquez entered a DMV branch in Sacramento and claimed her California driver’s license was lost or stolen. In doing so, Vasquez obtained a genuine driver’s license with her own picture and the identity theft victim’s personal identifying information. On April 15, 2016, Vasquez used the false identity to purchase a Nissan Altima from an auto dealership in Stockton. At the victim’s and creditors’ expense, Vasquez obtained a car loan from Well Fargo Bank for $16,703. On May 20, 2016, Vasquez opened accounts at Golden 1 Credit Union in Stockton using her phony California driver’s license number, the victim’s SSN, date of birth, true residence address, and signature. After opening the credit union accounts, Vasquez deposited stolen and altered checks to obtain cash.
This case was the product of an investigation by the United States Postal Inspection Service, with the assistance of the Stockton Police Department. Assistant United States Attorney Michelle Rodriguez prosecuted the case.
Statement of Acting U.S. Attorney Joon H. Kim on Second Circuit Decision in United States V. Sheldon SilverRead the Press Release
“While we are disappointed by the Second Circuit’s decision, we respect it, and look forward to retrying the case. Although finding that the Supreme Court’s McDonnell decision issued after Silver’s conviction required a different legal instruction to the jury, the Second Circuit also held that the evidence presented at the trial was sufficient to prove all the crimes charged against Silver, even under the new legal standard. Although this decision puts on hold the justice that New Yorkers got upon Silver’s conviction, we look forward to presenting to another jury the evidence of decades-long corruption by one of the most powerful politicians in New York State history. Although it will be delayed, we do not expect justice to be denied.”
Seventy-Seven Charged in Southern District of Florida as Part of Largest Health Care Fraud Action in Department of Justice HistoryRead the Press Release
Benjamin G. Greenberg, Acting United States Attorney for the Southern District of Florida; George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; Shimon R. Richmond, Special Agent in Charge, U.S. Department of Health & Human Services, Miami Regional Office, Office of Inspector General (HHS-OIG); and Pam Bondi, Florida Attorney General; announced today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts, including 115 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $1.3 billion in false billings. In the Southern District of Florida a total of 77 defendants were charged with offenses relating to their participation in various fraud schemes involving over $141 million in false billings for services including home health care, mental health services and pharmacy fraud.
Acting U.S. Attorney Benjamin G. Greenberg said, “Health care fraud schemes have real, long-term consequences for our South Florida community. Patients are being denied the quality of care that they deserve, doctors are turning a blind eye to their oaths, and taxpayer money is being diverted into the pockets of the greedy. Today’s announcement highlights South Florida’s united and ongoing law enforcement effort, culminating in charges against more than twenty percent of the national defendants, to thwart evolving schemes and combat the unlawful distribution of opioids and prescriptions drugs.
“The number of arrests are staggering and the dollar losses immense,” said Tim Langan, Acting Special Agent in Charge, FBI Miami. “These health care fraudsters, driven by greed, sought to cheat their way to riches by bilking millions of dollars from Medicare and other health care programs. The victims are U.S. taxpayers. The FBI and our law enforcement partners will investigate and criminally prosecute such fraud to the fullest extent of the law.”
“Those who betray patients and commit health care fraud by either distributing or receiving thinly veiled bribes, steal from taxpayers and corrupt the integrity of our health care system,” said Special Agent in Charge Shimon R. Richmond, HHS OIG Miami. “This takedown reflects the dedication of OIG and our law enforcement partners to bring such fraudsters to justice.”
Florida Attorney General Pam Bondi stated, “This massive fraud takedown targeted people abusing our health care industry and, in some cases, profiting from patients trying to recover from opioid addiction. The arrests and recoveries announced today should serve as a warning to anyone scheming to commit health care fraud that we will find them and they will be held accountable."
The following are some of the cases included in the takedown:
SOBER HOMES FRAUD
1. United States v. Eric Snyder and Christopher Fuller, Case No 17-MJ-8268-Brannon
Eric Snyder, 30, of Delray Beach, Florida, an owner of sober homes and addiction treatment facilities, and patient broker Christopher Fuller, 32, of West Palm Beach, Florida, are charged in a criminal complaint with conspiracy to commit health care fraud for their involvement in a scheme to illegally recruit patients, pay kickbacks and defraud health care benefit programs.
According to the criminal complaint, Snyder established a sober home, Halfway There Florida, LLC (HWT), also known as A Safe Place LLC, in Palm Beach County, Florida, which was purportedly in the business of providing a safe and drug-free residence for individuals suffering from drug and alcohol addiction. The defendants referred the sober home’s residents to a treatment center, Real Life Recovery Delray, LLC, (RLR), which was also owned by Eric Snyder. This treatment center purportedly offered clinical treatment services for persons suffering from alcohol and drug addiction.
According to the criminal complaint, to obtain patients for the sober home and treatment center (collectively “HWT/RLR”), Synder and other members of the conspiracy provided kickbacks and bribes, in the form of free or reduced rent, airline tickets, and other benefits, to individuals who agreed to reside at the sober homes, attend drug treatment therapy sessions, and submit to regular drug testing that members of the conspiracy could bill to the residents’ insurance plans. These patient brokers, including Fuller, were also paid kickbacks themselves by Snyder and others for referring patients to HWT/RLR for purported treatment.
According to the criminal complaint, fraudulent billings were submitted by HWT/RLR for services that were not medically necessary and/or were never provided. Licensed health professionals who used to work at HWT/RLR describe treatment conducted by unqualified and non-licensed employees, and billings for treatment that never occurred. The licensed professionals were asked to sign for and/or backdate this treatment as though they had conducted it. In addition, licensed professionals at HWT/RLR were asked to complete intake forms and other documents for patients that they had not seen. In some instances, services were billed for residents who left the sober homes and were no longer receiving treatment at the treatment centers. In other instances, patients were billed for therapy sessions they never attended, and therapy sign-in sheets and other documents fraudulently reflected that these patients attended these sessions, when they did not. The defendants provided services meant solely to maximize insurance reimbursements, such as expensive urine drug screens. HWT/RLR fraudulently used urine drug screens as a profit-machine, including splitting samples to send them to different laboratories, improper duplicate testing, and fraudulently double billing for tests for the same patients at both HWT and RLR. In addition, samples were fraudulently comingled prior to testing to prevent identical test results from exposing the scheme. After a search warrant was executed at a different treatment facility in Palm Beach County, in September 2014, Snyder and others attempted to stop or modify these illegal practices, and evidence of this wrongful conduct was removed and destroyed.
Mr. Greenberg commends the investigative efforts of the Greater Palm Beach County Health Care Fraud Task Force. Agencies of the task force that assisted with this matter include the FBI, Internal Revenue Service, Criminal Investigation (IRS-CI), Amtrak Office of Inspector General (Amtrak-OIG), U.S. Department of Labor Employee Benefits Security Administration (DOL), U.S. Office of Personnel Management Office of Inspector General (OPM-OIG), Palm Beach County State Attorney’s Office Sober Home Task Force, Palm Beach County Sheriff's Office, Delray Beach Police Department, Martin County Sheriff’s Office and the National Insurance Crime Bureau (NICB). The case is being prosecuted by Assistant United States Attorney James V. Hayes.
DRUG AND PHARMACY FRAUD SCHEMES – Medicare Part D
2. United States v. Orlando Bustabad, et al., Case No. 17-20441-CR-Moore
Orlando Bustabad, 61, Orlando Olver Bustabad, 31, Idilsis Manresa, 30, Sara Fernandez Escobar, 61, Mirtha Carrion Jimenez, 58, Alejandro Mena, 21, and Alejandro Sierra, 47, all of Miami, Florida, are charged by indictment with conspiracy to commit health care fraud and health care fraud. Orlando Bustabad and Orlando Olver Bustabad are also charged with aggravated identity theft.
According to the indictment, Orlando Bustabad and his son Orlando Olver Bustabad were the true owners of eight pharmacies located in Miami Dade County, namely, Med Solution Pharmacy, 17th Street Pharmacy, Rapid Pharmacy, Euro Pharmacy, A&B Pharmacy, Maxi Pharmacy, Mariposa Pharmacy, and 49th Street Pharmacy. Orlando Bustabad and Orlando Olver Bustabad operated these pharmacies under their own names or enlisted co-conspirators Manresa, Escobar, Jimenez, Mena, and Sierra to appear as owners. These pharmacies purportedly provided prescription drugs to Medicare beneficiaries. From February 2013 until June 2017, the defendants submitted and caused the submission of approximately $10,183,031 in claims for reimbursement to the Medicare Part D program, via interstate wires, that falsely and fraudulently represented that various health care benefits, primarily prescription drugs, were medically necessary, prescribed by a doctor, and had been provided by the pharmacies. As a result of such false and fraudulent claims, Medicare prescription drug plan sponsors made payments funded by the Medicare Part D Program to the corporate bank accounts of the eight pharmacies in the approximate amount of $4,649,743.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant United States Attorney Christopher J. Clark.
3. United States v. Victor Rocha, Case No. 17-20409-CR-Altonaga
Victor Rocha, 49, of Miami Lakes, Florida, was charged by indictment with six counts of health care fraud. The indictment charges Rocha with falsely and fraudulently submitting medical claims for prescription medications for reimbursement to Medicare Part D from September 2012 through May 2013, through his pharmacy, Med Express Pharmacy Discount, Inc. The Indictment charges that the claims were for prescription medications that were not provided and/or not medically necessary.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney James V. Hayes.
4. United States v. Alejandro Hernandez Rios, Case No. 17-20442-CR-Ungaro
Alejandro Hernandez Rios, 35, of Miami, Florida, was charged by indictment with five counts of health care fraud. The indictment charges Rios with falsely and fraudulently submitting medical claims for prescription medications for reimbursement to Medicare Part D from June through September 2014, through his pharmacy Independence Pharmacy and Discount, Inc. The indictment charges that the claims were for various prescription medications that were not provided and/or not medically necessary.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney James V. Hayes.
5. United States v. Pedro Mangano, Case No. 17-20408-CR-Martinez
Pedro Mangano, 52, of Miami, Florida, was charged by indictment with ten counts of Medicare fraud. The indictment alleges Mangano was the owner and operator of PVRX Pharmacy, located in Miami, Florida. Between March 2014 and June 2017, Mangano’s pharmacy submitted fraudulent claims for allegedly dispensing drugs to Medicare beneficiaries that the pharmacy never had in inventory to begin with. As part of the scheme, Mangano paid patient recruiters for fraudulent scripts used to defraud the Medicare Part D program. The fraudulent claims resulted in overpayments exceeding $1.1 million.
Mr. Greenberg commends the investigative efforts of HHS-OIG. This case is being prosecuted by Assistant United States Attorney Jon Juenger.
6. United States v. William Salazar Ortega, et al., Case No. 17-20454-CR-Gayles
On June 28, 2017, William Salazar Ortega and Oscar Alonso Gonzalez were indicted in connection with their roles at Latin Pharmacy, a pharmacy that defrauded Part D of the Medicare program of $2.38 million by billing for expensive prescription medications that were not prescribed to patients; were not necessary; and were not purchased. Salazar was the nominee owner of the pharmacy, and Gonzalez was its true owner. Each defendant was charged with one count of conspiracy to commit health care fraud and wire fraud and four counts of health care fraud. Gonzalez is also charged with one count of money laundering.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. The case is being prosecuted by Fraud Section Trial Attorney Timothy Loper.
7. United States v. Yara Suarez, et al., Case No. 17-20453-CR-Moreno
On June 29, 2017, Yara Suarez, Jesus Sanchez, Anthony Moya and Yoel Concepcion were indicted in connection with their roles at Albe Pharmacy, a pharmacy that defrauded Part D of the Medicare program of $3.4 million by billing for expensive prescription medications that were not prescribed to patients; were not necessary; and were not purchased. Sanchez and Suarez were the owners of the pharmacy, and are each charged with one count of conspiracy to commit health care fraud and wire fraud, three counts of health care fraud and one count of conspiracy to commit money laundering. Moya and Concepcion owned and controlled shell corporations through which over $380,000 of the fraud proceeds were laundered. Moya and Concepcion are each charged with one count of conspiracy to commit money laundering and three counts of substantive money laundering.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. The case is being prosecuted by Fraud Section Trial Attorney Timothy Loper.
8. United States v. Lisbet Cordova, Case No. 17-20450-CR-Cooke
On June 29, 2017, Lisbet Cordova, the owner of Jalvarez Pharmacy, Inc. (“Jalvarez”) was indicted on four counts of health care fraud. Through Jalvarez, Cordova billed Medicare, pursuant to Part D of the Medicare program, for prescriptions that were not medically necessary, prescribed or dispensed to Medicare beneficiaries. As part of the scheme, Jalvarez submitted approximately $730,000 in fraudulent claims to Medicare.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. The case is being prosecuted by Fraud Section Attorneys Alexander Kramer and Yisel Valdes.
PRESCRIPTION DRUG DIVERSION
9. United States v. Jose De Jesus Rodriguez, Case No. 17-20486-CR-Scola
Jose De Jesus Rodriguez, 47, of Miami, Florida, was charged by indictment with one count of conspiracy to unlawfully distribute prescription drugs and three substantive counts of improperly distributing prescription drugs, also referred to as prescription drug diversion. The indictment charges Rodriguez with illegally distributing millions of dollars’ worth of prescription medications from August 2011 through March 2015.
Mr. Greenberg commends the investigative efforts of the U.S. Food and Drug Administration’s (FDA) Office of Criminal Investigations (OCI), and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney James V. Hayes.
10. United States v. Reynaldo Ocana, Case No. 17-MJ-02939-Otazo-Reyes
Reynaldo Ocana, 46, of Miami, Florida, was charged by criminal complaint with improperly distributing prescription drugs, also referred to as prescription drug diversion. The criminal complaint charges Ocana with illegally diverting prescription drugs in August 2016.
Mr. Greenberg commends the investigative efforts of HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney James V. Hayes.
HOME HEALTH CARE FRAUD – Medicare Part A
11. United States v. Hector Fajardo Ramirez, Case No. 17-20301-CR-Moreno
Hector Fajardo Ramirez, 48, of Miami, Florida, was charged by indictment with six counts of health care fraud. The indictment charges that Ramirez falsely and fraudulently submitted medical claims for home health therapy for reimbursement to Medicare from February through July 2015, through his clinic Longevity Home Health Services, Inc. The indictment charges Ramirez with submitting claims for home health services that were not medically necessary and not provided.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney James V. Hayes.
12. United States v. Duniesky Cruz and Carlos Gomez Bravo, Case No. 17-20401-CR-Scola
Duniesky Cruz, 50, of Miami, Florida, the owner of home health agency Life & Hope Healthcare, Inc., and an employee Carlos Gomez Bravo, 33, of Miami, Florida, were charged by indictment with conspiracy to defraud the United States and pay health care kickbacks and payment of kickbacks in connection with a federal health care program. The charges stem from their involvement in a home health fraud scheme involving kickback payments to patient recruiters, patients, and clinic owners in exchange for patient referrals and prescriptions.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant United States Attorney Michael E. Gilfarb.
13. United States v. Vilma Alonso, Case No. 17-20468-CR-Ungaro
Vilma Alonso, 57, of Hialeah, Florida, an employee of South Florida Physician Care Network was charged by indictment with participating in a conspiracy to defraud the United States. Alonso was charged with conspiring with others to unlawfully enrich themselves by, among other things, submitting and causing the submission of false and fraudulent claims to Medicare and concealing the submission of false and fraudulent claims to Medicare. Alonso allegedly did this by causing the issuance of home health prescriptions that were not medical necessary and by paying recruiters for the referral of Medicare beneficiaries for home health services.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant United States Attorney Michael E. Gilfarb.
14. United States v. Maria Blanco, Case No. 17-20474-CR-Williams
Maria Blanco, 50 of Cape Coral, Florida, was charged by information with five counts of receiving kickbacks in connection with a federal health care program. The information charges Blanco with receiving approximately $8,500 in kickbacks on at least five occasions in 2014.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Michael B. Nadler.
15. United States v. Enrique Vilarello, et al., Case No. 17-20482-CR-Williams
On July 7, 2017, Enrique Vilarello and Alberto Ordaz were each indicted on one count of conspiracy to pay and receive illegal kickbacks. Ordaz was also indicted on two counts of receipt of kickbacks in connection with a federal health care program. The charges stem from their roles as patient recruiters, paying illegal kickbacks to obtain medical prescriptions from clinics and receiving illegal bribes for referring patients to pharmacies, and home health agencies in and around Miami, Florida. Several of these entities, such as Merfi and City Center, are now defunct as a result of their owners being charged and pleading guilty to multi-million dollar fraud schemes.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. The case is being prosecuted by Trial Attorney Angela Adams.
16. United States v. Juan Rodriguez, Case No. 17-20347-CR-Scola
On May 25, 2017, Juan Rodriguez, President and Director of Good Home Care, Inc., a now-defunct home health agency located in Miami, Florida, was indicted on five counts of health care fraud for his role in a $4 million scheme. Good Home allegedly billed Medicare for home health services that were never prescribed by a licensed physician or provided to Medicare beneficiaries.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. The case is being prosecuted by Trial Attorney David Snider.
17. United States v. Jesus Escobar Montero, Case No. 17-20439-CR-Williams
On June 22, 2017, Jesus Escobar Montero, President and Director of Better Care Home Health Services, Inc., a now-defunct home health agency located in Sunrise, Florida, was indicted on four counts of health care fraud for his role in a nearly $1 million scheme. The charges arise from Montero’s ownership of Better Care, which billed Medicare for home health services that were never prescribed by a licensed physician or provided to Medicare beneficiaries.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. The case is being prosecuted by Trial Attorney David Snider.
18. United States v. Carlos Barroso, et al., Case No. 17-20432-CR-Martinez
On June 22, 2017, Carlos Barroso, Andres Perez, Rolando Perez and Reiniel Garcia were indicted in connection with their roles at Sweet Home Health, Inc., a home health agency that defrauded Part A of the Medicare program of $8.4 million by billing for home health services that were not prescribed to patients; were not necessary; and were not rendered. Barroso was the owner of Sweet Home Health and was charged with seven counts of health care fraud, as well as one count of conspiracy to commit money laundering. A. Perez, R. Perez and Garcia owned and controlled shell corporations through which the fraud proceeds were laundered. They are each charged with one count of conspiracy to commit money laundering, three counts of money laundering and three counts of structuring to avoid reporting requirements.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. The case is being prosecuted by Fraud Section Trial Attorney Timothy Loper.
19. United States v. Jhony A. Alfau, et al, Case No. 17-20452-CR-Ungaro
On June 29, 2017, Jhony A. Alfau, Hector J. Garcia, and Sergio E. Santana were indicted on one count of conspiracy to commit health care and wire fraud, one count of conspiracy to make false statements relating to health care matters, and one count of making false statements relating to health care matters.The charges stem from the defendants’ role in a $50 million scheme to defraud Medicare where they falsely and fraudulently certified they provided home health care physical and occupational therapy services to Medicare beneficiaries, when in fact, they had not done so.
Mr. Greenberg commends the investigative assistance of the FBI and HHS-OIG. This case is being prosecuted by Fraud Section Attorneys Yisel Valdes and Alexander Kramer.
20. United States v. Ernesto Velasquez, Case No. 17-20462-CR-Martinez
On July 5, 2017, Ernesto Velasquez, was charged by information with one count of conspiracy to commit health care fraud. The charge stems from the defendant’s role as an employee of staffing agencies that sought to defraud the United States by billing Medicare for providing licensed physical and occupational therapy to home bound patients when, in fact, they had not rendered the services. As part of the scheme, these alleged services were billed to Medicare with a loss of over $3 million.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. The case is being prosecuted by Fraud Section Attorneys Alexander Kramer and Yisel Valdes.
21. United States v. Suley Cao, Case No. 17-20451-CR-Martinez
On June 29, 2017, Suley Cao, the owner and operator of Good Friends Services, Inc. (“Good Friends”), a home health agency, was indicted on five counts of health care fraud; one count of conspiracy to defraud the United States and pay Health Care Kickbacks; and two counts of payment of kickbacks in connection with a federal health care benefit program. The charges stem from Cao’s role as owner and operator of Good Friends, which fraudulently billed Medicare for approximately $3,017,276.89 for home health services that involved a scheme whereby Good Friends made kickback payments to induce the referral of Medicare beneficiaries.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. The case is being prosecuted by Fraud Section Attorneys Alexander Kramer and Yisel Valdes.
22. United States v. Rafael Arias et al., Case No. 17-MJ-02962-Garber
On July 13, 2017, Rafael Arias, Aylen Gonzalez, Ana Gabriela Mursuli Caballero, and Rafael Cabrera were charged by criminal complaint with conspiracy to commit health care fraud for their roles in an approximately $6 million Medicare fraud scheme involving various home health agencies in and around Miami, Florida. Arias was alleged to be the true owner of multiple home health agencies, such as Nestor’s Health Services, Inc. Arias hid the fact of his true ownership and instead directed others, like Cabrera, to fraudulently represent themselves as owners to Medicare, which allowed them to obtain Medicare provider numbers and submit claims for services purportedly provided to Medicare beneficiaries even though many of the services were medically unnecessary or were obtained as a result of illegal bribes and kickbacks. Gonzalez and Caballero were patient recruiters who facilitated kickback schemes with Arias by referring patients to home health agencies operated by Arias in exchange for bribes and kickbacks. Gonzalez and Caballero also purchased medically unnecessary prescriptions from fraudulent medical clinics. Caballero also owned and operated City of Angels Home Health Care LLC, a home health agency that she used to bill Medicare for home health services that were medically unnecessary or were obtained as a result of illegal bribes and kickbacks.
Mr. Greenberg commends the investigative efforts of the FBI. The case is being prosecuted by Fraud Section Trial Attorney Angela Adams.
ASSISTED LIVING FACILITY FRAUD
23. United States v. Bertha Blanco, Case No. 17-MJ-02949-Garber
On July 11, 2017, Bertha Blanco, who was employed for approximately 30 years by the State of Florida’s Agency for Health Care Administration (AHCA), was charged by complaint with bribery of a program receiving federal funds. AHCA is responsible for administering the Medicaid program in Florida, and is tasked with regulating and licensing health care facilities in Florida, including skilled nursing facilities (SNFs) and assisted living facilities (ALFs). The charge alleges that Blanco solicited and received cash bribes from Medicare and Medicaid providers in exchange for providing them with confidential, nonpublic AHCA reports and information, including patient complaints and the unannounced inspection schedules of AHCA surveyors. This information was ultimately used by the purchasers, some of whom were owners of skilled nursing facilities (SNFs) and assisted living facilities (ALFs), to fabricate and falsify medical paperwork and to temporarily remedy deficiencies so that AHCA would not discover lapses in patient care and revoke the licenses of these facilities. The owners of these SNFs and ALFs then submitted false and fraudulent claims to Medicare and Medicaid for patients named in the complaints and inspection reports sold to them by Blanco.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being handled by Trial Attorneys David Snider, Elizabeth Young and Drew Bradylyons.
CLINICS, MANAGED CARE, MEDICARE ADVANTAGE FRAUD –
Medicare Part C
24. United States v. Beatriz Carrasco, Case No. 17-20464-CR-Ungaro
On July 6, 2017, Beatriz Carrasco, 49, of Hialeah, Florida was charged by information with one count of conspiracy to commit health care fraud and wire fraud. The information charges Carrasco, a Florida licensed insurance agent, with conspiring to enroll others into Medicare Advantage plans and Florida Medicaid. These individuals resided in Nicaragua, outside of the Medicare Advantage plans coverage area. As a result of Carrasco’s and her co-conspirator’s actions, Medicare and the Florida Medicaid program paid over $1,013,244 in monthly capitation payments and premiums on behalf of individuals residing in Nicaragua, who were otherwise ineligible to receive these benefits.
Mr. Greenberg commends the investigative efforts of the FBI, HHS-OIG and the State of Florida Medicaid Fraud Control Unit. This case is being prosecuted by Special Assistant U.S. Attorney Hagerenesh Simmons from the Florida Attorney General’s Office, Medicaid Fraud Control Unit.
25. United States v. Greesy Misuraca, Case No. 17-20461-CR-Scola
On July 5, 2017, Greesy Misuraca, a licensed therapist, was charged by information with one count of conspiracy to commit health care fraud. The charge stems from the defendant’s alleged role in billing Medicare for licensed physical and occupational therapy that was given to home bound patients when, in fact, she did not provide the therapeutic services. As part of the scheme, these alleged services were billed to Medicare with a loss of over $650,000.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. The case is being prosecuted by Fraud Section Attorneys Alexander Kramer and Yisel Valdes.
PRIVATE INSURANCE FRAUD (Non-Medicare)
26. United States v. Leopoldo Becerra, Case No. 17-20470-CR-Moreno
Leopoldo Becerra, 50, of Miami, Florida was charged by indictment one count of health care fraud. The indictment charges Becerra with using Doctor Jalal Taslimi Medical Center, Inc., to falsely and fraudulently submit medical claims for reimbursement to Blue Cross Blue Shield of Florida from November 25, 2014 through May 25, 2015. The indictment charges Becerra with submitting fraudulent claims for beneficiaries purportedly receiving various injections.
Mr. Greenberg commends the investigative efforts of the FBI. This case is being prosecuted by Assistant U.S. Attorney Michael B. Nadler.
27. United States v. Jorge A. Gonzalez and Lazaro La Paz Paz,
Case No. 17-20440-CR-Martinez
Jorge A. Gonzalez, 50, of Miami, Florida and Lazaro La Paz Paz, 50, of Hialeah, Florida are charged by indictment with one count of conspiracy to commit health care fraud and wire fraud. The indictment charges Gonzalez and La Paz Paz with using two companies, Xtra Health Center, Inc & Gold Medical Center, Inc, and fraudulently representing that medical services were prescribed by doctors and provided to private insurance beneficiaries by these businesses. Gonzalez and La Paz Paz then falsely and fraudulently submitted these medical claims for reimbursement to Blue Cross Blue Shield of Florida from April 2014 through February 2015.
Mr. Greenberg commends the investigative efforts of the FBI. This case is being prosecuted by Assistant U.S. Attorney Michael B. Nadler.
TRICARE FRAUD – Military Insurance
28. United States v. Michael Shane Matthews, Case No. 17-20463-CR-Gayles
On July 6, 2017, Michael Shane Matthews, 47, of Newberry, Florida, was charged by information with causing the misbranding of drugs while held for sale.
Mr. Greenberg commends the investigative efforts of Defense Criminal Investigative Service (DCIS), Southeast Field Office, U.S. Food and Drug Administration’s (FDA) Office of Criminal Investigations (OCI), the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit, and HHS-OIG. This case is being prosecuted by Assistant United States Attorney Kevin J. Larsen.
29. United States v. Asciano Serna, Case No. 17-20484-CR-Altonaga
On July 7, 2017, Asciano Serna, owner and operator of ASC Pharmacy, Inc., was charged by information with one count of conspiracy to commit health care fraud. The charge arises from Serna’s role in a compounding pharmacy scheme at ASC Pharmacy involving the submission of at least $3.4 million of false and fraudulent claims to private insurance companies, Medicare, TRICARE, and other federal programs.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant United States Attorney Jon Juenger and Trial Attorney David Snider.
UNLICENSED MONEY TRANSMITTING AND MONEY LAUNDERING
30. United States v. Yisel Torres, Case No. 17-20477-CR-Moreno
Yisel Torres, 31, of Cape Coral, Florida was charged by information with one count of participating as an unlicensed money transmitter. The information charges Torres with cashing several checks totaling $135,000 from on or about May 22, 2014, through on or about March 11, 2015. The proceeds that Torres cashed were used to pay cash kickbacks to Medicare beneficiaries that were enrolled in R&N Professional Services.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Michael B. Nadler.
31. United States v. Angel Rivero, Case No. 17-20475-CR-Cooke
Angel Rivero, 43, of Miami, Florida was charged by information with one count of participating as an unlicensed money transmitter. The information charges Rivero with cashing several checks totaling $100,000 from on or about May 22, 2014, through on or about March 11, 2015. The proceeds that Rivero cashed were used to pay cash kickbacks to Medicare beneficiaries that were enrolled in Happy Heart Home Health Care.
Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG. This case is being prosecuted by Assistant U.S. Attorney Michael B. Nadler.
32. United States v. Yailyn Marimon, et al., Case No. 17-20492-CR-Martinez
On July 11, 2017, Yailyn Marimon and Yamilka Echeverria were indicted in connection with their roles laundering money four Orlando-area medical clinics stole from Part C of the Medicare program. The Clinics, which were owned by Yosbel Marimon – the defendants’ brother and ex-husband, respectively – billed Medicare for $13.8 million of expensive infusion therapy drugs and physical therapy that were not medically necessary, and were never provided. On June 26, 2017, Yosbel Marimon was sentenced to 90 months’ imprisonment for his role in the scheme. The indictment alleges that Yailyn Marimon and Yamilka Echeverria laundered over $2 million of the fraud proceeds through shell companies they owned and controlled. Each defendant was charged with one count of conspiracy to commit money laundering and one count of substantive money laundering.
Mr. Greenberg commends the investigative efforts of HHS-OIG. The case is being prosecuted by Fraud Section Trial Attorney Timothy Loper.
If convicted of a charged offense, a defendant faces a possible maximum statutory sentence of: five years in prison for participating in a conspiracy (to defraud the United States by paying and receiving health care kickbacks or by unlawfully distributing prescription drugs), in violation of Title 18, United States Code, Section 371; twenty years in prison for mail fraud, in violation of Title 18, United States Code, Section 1341; twenty years in prison for wire fraud, in violation of Title 18, United States Code, Section 1343; ten years in prison for health care fraud, in violation of Title 18, United States Code, Section 1347; twenty years for conspiracy to commit health care fraud and wire fraud, in violation of Title 18, United States Code, Section 1349; twenty years for money laundering or conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956; and ten years in prison for money laundering, in violation of Title 18, United States Code, Section 1957; and five years in prison for conducting an unlicensed money transmitting business, in violation of Title 18, United States Code, Section 1960(b)(2). In addition, a defendant may be subject to one year in prison for misbranding a drug held for sale, in violation of Title 21, United States Code, Sections 331(t) (prescription drug marketing violations are subject to a maximum penalty of ten years in prison, in accordance with Title 21, United States Code, Sections 333(b)(1)(D), and 353(e)(1)(A)) and five years in prison for payment and receipt of kickbacks in connection with a federal health care program, in violation of Title 42, United States Code, Section 1320a. Furthermore, if convicted of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A, a defendant faces a mandatory consecutive term of two years in prison.
A criminal complaint, information or federal indictment is a charging instrument containing allegations. All defendants are presumed innocent, unless and until proven guilty in a court of law.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Sentencings for July 7 - July 11, 2017Read the Press Release
Harold Duane Friday, 20, of Fort Washakie, Wyoming, was sentenced by Federal District Court Judge Scott W. Skavdahl on July 11, 2017, on three counts of abusive sexual contact. Friday was arrested in Fort Washakie, Wyoming. He received 144 months of imprisonment, to be followed by 15 years of supervised release, and was ordered to pay a $300.00 special assessment and $952.36 in restitution. This case was investigated by the Bureau of Indian Affairs.
Carlos Daniel Jara-Tinoco, 25, of Durango, Mexico, was sentenced by Federal District Court Judge Scott W. Skavdahl on July 11, 2017, for illegal alien in possession of a firearm. Jara-Tinoco was arrested in Cheyenne, Wyoming. He received seven months of imprisonment, to be followed by one year of supervised release, was order to pay a $100.00 special assessment, and is subject to deportation upon release from custody. This case was investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement.
Jeffery Mark Quigley, 32, of Cheyenne, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson on July 10, 2017, for conspiracy to distribute methamphetamine and for possession of a firearm by a person convicted of domestic violence. Quigley was arrested in Cheyenne, Wyoming. He received 135 months of imprisonment, to be followed by four years of supervised release, and was ordered to pay a $200.00 special assessment and $400.00 in restitution. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Randi Nicole Gunderson, 30, of Thornton, Colorado, was sentenced by Chief Federal District Court Judge Nancy D. Freudenthal on July 7, 2017, for conspiracy to commit bank fraud and for aggravated identity theft. Gunderson was arrested in Cheyenne, Wyoming. She received 64 months of imprisonment, to be followed by four years of supervised release, and was ordered to pay a $200.00 special assessment and $17,247.29 in restitution. This case was investigated by the United States Postal Inspection Service.
John Todd Allen, 55, of Casper, Wyoming, was recently sentenced by Federal District Court Judge Alan B. Johnson for conspiracy to distribute in excess of one pound of methamphetamine. Allen received 120 months of imprisonment, to be followed by five years of supervised release, and was ordered to pay a $100.00 special assessment and $1,500.00 in restitution. This case was investigated by the Wyoming Division of Criminal Investigation and the U.S. Drug Enforcement Administration.
Scarborough Woman Charged with Embezzlement from a Health Care Benefit ProgramRead the Press Release
Portland, Maine: Acting United States Attorney Richard W. Murphy announced that Carrie Caporino, 45, of Scarborough, Maine, was arrested on Tuesday and charged in U.S. District Court by criminal complaint with embezzling from a health care benefit program.
According to court records, from December 2015 to June 2017, Caporino was employed as the office manager for a Falmouth physician. The complaint affidavit alleges that she took about 600 checks totaling about $250,000 payable to the physician or the practice, and deposited them into her personal bank accounts, instead of the practice’s bank account.
She faces up to 10 years in prison and a $250,000 fine.
This case was investigated by the Federal Bureau of Investigation. It was part of the Department of Justice’s (DOJs’) Health Care Fraud Takedown announced today by Attorney General Jeff Sessions and Department of Health and Human Services Secretary Tom Price, M.D., which is the largest health care fraud enforcement action in DOJ’s history.
A criminal complaint is merely an accusation and a defendant is presumed innocent unless proven guilty in a court of law.
Rocky Mount Man Sentenced to 262 Months for Heroin Distribution and Firearm OffenseRead the Press Release
GREENVILLE – The United States Attorney for the Eastern District of North Carolina John Stuart Bruce announced that yesterday in federal court, Senior U.S. District Court Judge Malcolm J. Howard, sentenced QUINCY ANDRE JONES, 38, of Pinetops, North Carolina to 262 months imprisonment followed by 5 years of supervised release. On August 8, 2016, JONES pled guilty to one-count of Conspiracy to Distribute and Possess with Intent to Distribute a Quantity of Heroin and to one-count of Possession of a Firearm in Furtherance of a Drug Trafficking Crime.
U.S. Attorney John Stuart Bruce commented, “Our office is working every day with federal, state, and local law enforcement to fight the nationwide plague of heroin/opioid abuse. Vigorous prosecution of the dealers of this poison is an essential part of this effort.”
“It is always a good day when a heroin dealer goes to prison for over 20 years,” said Rocky Mount Chief of Police James C. Moore. “Heroin addiction is an unwelcome habitual disease that is devastating our society. I hope that this sentence will make other dealers think twice before they decide to sell drugs in Rocky Mount.”
Investigation revealed that between January 19, 2016, and June 3, 2016, investigators from the Rocky Mount Police Department, conducted nine controlled purchases of heroin, or substances purporting to be heroin, from JONES or individuals working for JONES.
On June 3, 2016, following the controlled transactions detailed above, investigators initiated a traffic stop of JONES’ vehicle and he was taken into custody without incident. Following his arrest, JONES provided a statement to investigators. JONES advised that he obtained a handgun two weeks earlier from a heroin addict, in exchange for 30 bindles of heroin. He explained that he started selling heroin in December 2015, and that he purchased 1 to 2 bricks (1.2 to 2.4 grams) of heroin per day from his supplier. JONES went on to discuss his own drug trafficking and noted that he made approximately $800 per day.
The case was investigated by the Rocky Mount Police Department and the Drug Enforcement Administration. Special Assistant United States Attorney Boz Zellinger prosecuted the case.
Recording Artist and Performer DMX Charged with Tax FraudRead the Press Release
Joon H. Kim, the Acting United States Attorney for the Southern District of New York, and James D. Robnett, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), announced the arrest of EARL SIMMONS, an internationally known recording artist, performer, and actor known professionally as “DMX” and “X,” for engaging in a multi-year scheme to conceal millions of dollars of income from the IRS and to avoid paying $1.7 million of tax liabilities. SIMMONS surrendered to law enforcement agents today and will be presented tomorrow in Manhattan federal court before United States Magistrate Judge Andrew J. Peck
Acting U.S. Attorney Joon H. Kim said: “For years, Earl Simmons, the recording artist and performer known as DMX, made millions from his chart-topping songs, concert performances and television shows. But while raking in millions from his songs, including his 2003 hit ‘X Gon’ Give it to Ya,’ DMX didn’t give any of it to the IRS. Far from it, DMX allegedly went out of his way to evade taxes, including by avoiding personal bank accounts, setting up accounts in other’s names and paying personal expenses largely in cash. He even allegedly refused to tape the television show ‘Celebrity Couples Therapy’ until a properly issued check he was issued was reissued without withholding any taxes. Celebrity rapper or not, all Americans must pay their taxes, and together with our partners at the IRS, we will pursue those who deliberately and criminally evade this basic obligation of citizenship.”
IRS-CI Special Agent in Charge James D. Robnett said: “While most individuals file truthful tax returns and pay their taxes, the indictment against Mr. Simmons alleges various tax crimes, including that he failed to file personal tax returns for several years and did not pay his fair share of taxes. IRS-Criminal Investigation will continue to focus our investigative efforts on those who try to conceal their income in order to evade their taxes.”
According to the allegations in the Indictment[1] unsealed today in Manhattan federal court:
SIMMONS, known professionally as “DMX” or “X,” worked as a recording artist, performer, and actor. Beginning in 1997, SIMMONS released a series of hip-hop albums that sold millions of records. Many of his albums went platinum and occupied the top positions on musical charts. During his career, SIMMONS has performed at venues across the United States and around the world, and has acted in motion pictures.
As a result of the income SIMMONS earned from sources including musical recordings and performances, from 2002 through 2005 he incurred federal income tax liabilities of approximately $1.7 million. Those liabilities went unpaid, and in 2005, the IRS began efforts to collect SIMMONS’s unpaid tax liabilities.
During the period from 2010 through 2015, SIMMONS earned over $2.3 million, but SIMMONS did not file personal income tax returns during that time period. Instead, he orchestrated a scheme to evade payment of his outstanding tax liabilities, largely by maintaining a cash lifestyle, avoiding the use of a personal bank account, and using the bank accounts of nominees, including his business managers, to pay personal expenses. For example, SIMMONS received hundreds of thousands of dollars of royalty income from his music recordings. SIMMONS caused that income to be deposited into the bank accounts of his managers, who then disbursed it to him in cash or used it to pay his personal expenses. SIMMONS also participated in the “Celebrity Couples Therapy” television show in 2011 and 2012 and was paid $125,000 for his participation. When taxes were withheld from the check for the first installment of that fee by the producer, SIMMONS refused to tape the remainder of the television show until the check was reissued without withholding taxes.
SIMMONS took other steps to conceal his income from the IRS and others, including by filing a false affidavit in U.S. Bankruptcy Court that listed his income as “unknown” for 2011 and 2012, and as $10,000 for 2013. In fact, SIMMONS received hundreds of thousands of dollars of income in each of those years.
* * *
SIMMONS, 46, of Yonkers, New York, is charged in 14 counts: one count of corruptly endeavoring to obstruct and impede the due administration of Internal Revenue Laws, one count of evasion of payment of income taxes, six counts of evasion of assessment of income tax liability, and six counts of failure to file a U.S. individual income tax return. Count One carries a maximum sentence of three years. Counts Two through Eight each carry a maximum sentence of five years. Counts Nine through Fourteen each carry a maximum sentence of one year. The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant would be determined by the judge.
Mr. Kim praised the investigative work of the IRS-CI.
This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Richard Cooper is in charge of the prosecution.
The allegations contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phase signifies, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Raytown Man Sentenced for Stealing $86,000 from Two ChurchesRead the Press Release
KANSAS CITY, Mo. – Tom Larson, Acting United States Attorney for the Western District of Missouri, announced that a Raytown, Mo., man who worked or volunteered at two area churches was sentenced in federal court today for embezzling more than $86,000 from those parishes.
David Townley, 60, of Raytown, was sentenced by U.S. District Judge Gary A. Fenner to one year and one day in federal prison without parole. The court also ordered Townley to pay $86,297 in restitution.
On Feb. 14, 2017, Townley pleaded guilty to one count of wire fraud, one count of mail fraud and one count of tax evasion.
Nativity of Mary (Wire Fraud)
Townley admitted that he engaged in a scheme to defraud Nativity of Mary church and school in Independence, Mo., from 2007 through 2013.
Townley was employed by the Nativity of Mary church and school as the business manager from December 2006 through June 2013. Townley handled the payroll and had access to both cash and check collections/donations, and school tuition payments. From 2011 through 2013, Townley skimmed money from cash tuition payments made by parents. Townley recorded accurate tuition deposits in the school’s log but deposited a lesser amount into the church’s bank account.
Townley is responsible for a loss of $52,166, which includes $32,194 in unauthorized checks deposited into Townley’s personal account and $19,971 in cash from tuition payments deposited into Townley’s personal bank account.
Townley’s bank records revealed frequent cash deposits separate from his and his wife’s salary payments. Nativity of Mary banked at the Blue Ridge Bank and Trust in Kansas City, Mo. The processing of checks through the Federal Reserve System from Nativity of Mary constituted the wire fraud.
Sacred Heart of Guadalupe (Mail Fraud)
Townley stole $34,131 from Sacred Heart of Guadalupe church in Kansas City, Mo., in a fraud scheme that lasted from 2006 through 2013.
Townley was a volunteer at Sacred Heart of Guadalupe from 2002 through 2013. Townley was in charge of paying the church’s bills, making QuickBooks entries, reporting to the financial committee and filing the church’s tax returns. From 2006 through 2013, Townley negotiated more than 20 checks, totaling $47,705, and deposited them into his personal bank account. Some of these checks were unauthorized salary payments and others were made out to third parties, such as the “Society of the Precious Blood” and the Diocese of Kansas City.
Sacred Heart of Guadalupe banked at U.S. Bank in Kansas City, Mo., which mailed statements to the church and constituted the mail fraud charge.
The total loss amount from the two fraud schemes was $86,297. According to an analysis of his bank records, Townley used the money he embezzled mostly to pay off credit card debt.
Tax Evasion
Townley admitted that he failed to file federal income tax returns for tax years 2005 through 2013. During those years, Townley had taxable income that ranged from $54,633 to $115,721. The total federal tax loss for those years is $59,322. The total tax loss to the state of Missouri is $30,117.
Townley attempted to conceal his true sources of income at Nativity of Mary and Sacred Heart of Guadalupe. The acts of evasion in those years included making false entries in the accounts of Nativity of Mary and skimming cash from tuition payments made by parents at the Nativity of Mary school.
This case was prosecuted by Assistant U.S. Attorney Paul S. Becker. It was investigated by the U.S. Secret Service and IRS-Criminal Investigation.
Ohio man indicted for receiving and distributing images of children being sexually exploitedRead the Press Release
Keith Bollinger, 45, of McClure, was indicted for receipt and distribution of child pornography, said Acting U.S. Attorney David A. Sierleja.
Bollinger received and distributed images of child sexual exploitation between January and June 2017, according to the indictment.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigating agency in this case is the United States Secret Service. The case is being handled by Assistant U.S. Attorney Tracey Ballard Tangeman.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Norwalk Doctors Charged with Operating "Pill Mill," Health Care Fraud and Money LaunderingRead the Press Release
Deirdre M. Daly, United States Attorney for the District of Connecticut, Michael J. Ferguson, Special Agent in Charge of the Drug Enforcement Administration for New England, today announced that two doctors who have operated a medical practice in Norwalk have been charged by federal criminal complaint with writing prescriptions outside the scope of legitimate medical practice, health care fraud and money laundering.
Dr. BHARAT PATEL, 70, of Milford, was arrested yesterday at his residence. He appeared before U.S. Magistrate Judge William I. Garfinkel in Bridgeport and is detained pending a detention hearing that is scheduled for July 17.
Dr. RAMIL MANSOUROV, 47, of Darien, is currently being sought by law enforcement.
As alleged in the criminal complaint, PATEL and MANSOUROV are physicians who operated out of Family Health Urgent Care, located at 235 Main Street in Norwalk. The medical practice was formerly known as Immediate Health Care, which was owned by PATEL. In approximately 2012, MANSOUROV purchased the practice from PATEL and renamed it Family Urgent Health Care, and PATEL continued to work at the practice. PATEL and MANSOUROV are participating providers with Medicare and the Connecticut Medicaid Program. Beginning in approximately 2013, the Drug Enforcement Administration received information that PATEL and MANSOUROV may be writing prescriptions for controlled substances outside the scope of legitimate medical practice.
The complaint alleges that PATEL regularly provided prescriptions for narcotics, including oxycodone and hydrocodone, to patients that he knew were addicted or had been arrested for distributing or possessing controlled substances. On numerous occasions, PATEL provided prescriptions to patients who paid him $100 in cash for each prescription. In certain instances, PATEL would write prescriptions for individuals who were not his patients in exchange for cash. At times, when PATEL was not available, MANSOUROV provided PATEL’s patients with unnecessary prescriptions. PATEL and MANSOUROV also regularly provided post-dated prescriptions to individuals, sometimes with dates that matched future dates when the doctors would be out of the country.
It is alleged that certain individuals who paid PATEL cash for prescriptions paid for the filled prescriptions by using a state Medicaid card, and then illegally distributed the drugs. The investigation revealed that in 2014 alone, more than $50,000 in cash deposits were made into PATEL and his wife’s bank accounts, and that some of these funds were used to purchase PATEL’s current residence.
The complaint further alleges that between November 2013 and December 2016, MANSOUROV defrauded the state’s Medicaid program of more than $4 million by billing for home visits that he never made, billing for nursing home visits that he never made, billing for office visits that never happened, and billing for visits that he claimed took place on dates on which he was actually out of state or out of the country. Billing records also reveal that, on some occasions, MANSOUROV and PATEL billed Medicaid for the same patient on the same day at two different locations.
It is alleged that MANSOUROV moved some of the stolen funds to a bank account in Switzerland.
“These two doctors are charged with violating their oaths and recklessly prescribing highly addictive painkillers,” said U.S. Attorney Daly. “Dr. Patel is alleged to have regularly sold to addicts solely for his own profit. Many of these patients filled the prescriptions using state healthcare benefits, and then turned around and sold the pills on the street, contributing to our devastating opioid epidemic. Some addicts referred to these defendants’ medical practice as ‘The Candy Shop.’ Dr. Mansourov is also charged with bilking state and federal governments of over 4 million dollars through a phony billing scheme. I thank the DEA’s Tactical Diversion Squad, the Norwalk Police Department and the Connecticut Attorney General’s Office for their excellent work in shuttering this medical practice.”
“The DEA is committed to enforcing the Controlled Substance Act (CSA) by ensuring that all registrants are in compliance and abide by DEA’s distribution regulations,” said Special Agent in Charge Ferguson. “The reckless actions by these two doctors by writing prescriptions outside the scope of their legitimate medical practice contributed to the widespread abuse of opiates, which is a gateway to heroin addiction and is devastating our communities. In response to the ongoing opioid epidemic DEA is committed to improve public safety and public health by working with our law enforcement and regulatory partners to ensure these rules and regulations are strictly followed. This investigation demonstrates the strength of collaborative law enforcement in Connecticut and our great partnership with the U.S. Attorney’s Office.”
The complaint charges PATEL and MANSOUROV with conspiracy to distribute and to possess with intent to distribute narcotics, an offense that carries a maximum term of imprisonment of 20 years; health care fraud, an offense that carries a maximum term of imprisonment of 10 years, and conspiracy to commit money laundering, an offense that carries a maximum term of imprisonment of 10 years.
U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This investigation is being conducted by the DEA’s New Haven Tactical Diversion Squad and the Norwalk Police Department, with the critical assistance of the Connecticut Office of the Attorney General. The DEA Tactical Diversion Squad includes officers from the Bristol, Greenwich, Hamden, Milford, New Haven, Shelton, Vernon and Wilton Police Departments. The case is being prosecuted by Assistant U.S. Attorney Rahul Kale.
Ninth Circuit Denies Challenge to $122.5M Settlement for 2007 Moonlight FireRead the Press Release
SACRAMENTO, Calif. — In a unanimous opinion, the U.S. Court of Appeals for the Ninth Circuit today affirmed the denial of relief from judgment for Sierra Pacific Industries and the other defendants held responsible for the Moonlight Fire in a settlement they entered with the United States five years ago.[1]
U.S. Attorney Phillip A. Talbert said, “We are gratified but not surprised by today’s decision, which helps make an important point this fire season. When negligent logging operations cause massive forest fires, this Office will respond with exactly the kind of tenacious, professional advocacy shown by Assistant U.S. Attorneys David Shelledy, Kelli Taylor and the rest of the team. Consistent with the best traditions of the U.S. Department of Justice, our office will continue to hold the careless to account.”
The fire started on Labor Day 2007 and burned over 46,000 acres of the Plumas and Lassen National Forests before it could be extinguished. In a complaint filed in 2010, the United States alleged that the fire started and escaped due to the neglect by Sierra Pacific and one of its contractors in operating bulldozers on a remote logging site on a “red flag” warning day. The contractor’s employees abandoned the job site to get a soda and cellphone soon after completing work, without inspecting the area to ensure they had not started a fire, as required by company policy and state law. The same contractor started two other fires the same summer working on other projects for Sierra Pacific. Sierra Pacific knew the contractor had started one of those fires yet took no action to ensure fire safety.
After litigation commenced, the contractor formally admitted that the fire started in its work area where no one but its employees was seen all day. Sierra Pacific, however, engaged in extensive litigation in an effort to avoid responsibility.
In 2012, the district court in Sacramento ruled that Sierra Pacific could present at trial some of its claims that the government engaged in fraud in attributing blame for the fire. However, in July 2012, Sierra Pacific and the other defendants averted trial by entering a settlement.
In exchange for dismissal of the United States’ complaint, the defendants agreed to pay a total of $55 million in cash. Sierra Pacific’s share of the settlement was $47 million and a conveyance of 22,500 acres of undeveloped land for incorporation into the National Forest System.
With a total value of at least $122.5 million, the settlement is the largest ever received by the United States for damages caused by a forest fire. All of the settlement payments are now complete. Land transfers totaling more than 12,000 acres have been completed with the remainder ongoing.
In the settlement agreement, Sierra Pacific and the other defendants specifically agreed to release all claims—known or unknown. Nonetheless, in October 2014, they filed a motion for relief from judgment, seeking to back out of the settlement based on allegations of fraud. Almost all accusations in the motion repeated the baseless claims made by Sierra Pacific in litigation before the settlement.
In April 2015, U.S. District Judge William B. Shubb issued a detailed 63-page order denying the motion and emphatically rejecting every allegation by Sierra Pacific’s counsel that there was fraud on the court.[2] After an exhaustive review of the law and the record, Judge Shubb concluded that the defendants “failed to identify even a single instance of fraud on the court, certainly none on the part of any attorney for the government. They repeatedly argue that fraud on the court can be found by considering the totality of the allegations. . . . Stripped of all its bluster, defendants’ motion is wholly devoid of any substance.” This is the order affirmed today by the court of appeals.
In a unanimous, 34-page opinion the Ninth Circuit ruled that “[a]fter voluntarily settling this case and asking the district court to enter judgment based on that settlement,” the defendants’ allegations of newly discovered fraud failed to meet the high showing required for relief from judgment. The court ruled that all accusations of fraud discovered before the settlement were legally insufficient — whether those accusations were true or not — because Sierra Pacific and the other defendants “voluntarily settled instead of going to trial.” The settlement agreement also precluded all accusations that the defendants claimed to have discovered after settlement, the court explained, because under the express terms of the settlement agreement, the defendants “bound themselves not to seek future relief, even for fraud on the court.” And finally, the court ruled that even if the settlement terms did not bar relief, “we conclude [those accusations] do not constitute fraud on the court.”
The court specifically rejected Sierra Pacific’s claim that an Assistant U.S. Attorney encouraged perjury by telling a federal investigator the government’s lawyers considered Sierra Pacific’s core scandal claim (that a white flag at the fire investigation scene marked the initial, “concealed” point of origin) to be “a non-issue.” The court explained that this comment was “merely an opinion about the relative importance of an element of the case; . . . not an instruction to commit perjury.”
Despite Sierra Pacific’s inflammatory accusations against the Assistant U.S. Attorneys representing the government in this case, not one of the number of federal judges to have issued rulings before and after settlement have sustained any of those accusations.
[1] The case is United States v. Sierra Pacific Industries, et al., Ninth Circuit No. 15-15799.
[2] United States v. Sierra Pacific Industries, et al., No. 2:09-02445 (E.D. Cal. April 17, 2015).
New Orleans Men Sentenced in Seventh Ward Heroin and Firearm ConspiracyRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that DARRYL LEWIS, a/k/a “Uncle Tom,” a/k/a “Poppa Tom,” age 63, and DEMOINDE ROWLEY, a/k/a “Chuck,” age 40, both of New Orleans, were sentenced today after previously pleading guilty to federal narcotics charges.
DARRYL LEWIS was a street-level dealer in the conspiracy. He sold heroin to customers in the Seventh Ward of New Orleans with several co-conspirators. LEWIS also stored firearms for his co-conspirators and served as a “tester” of heroin. He pled guilty to conspiracy to distribute heroin. U.S. District Judge Carl J. Barbier sentenced him to a term of time served (approximately 31 months) in prison, and a supervised release term of 3 years.
DEMOINDE ROWLEY likewise was a street-level dealer who purchased heroin from members of the Seventh Ward-based conspiracy. He also pleaded guilty to conspiracy to distribute heroin. U.S. District Judge Carl J. Barbier sentenced ROWLEY to five years of probation.
Acting U.S. Attorney Evans praised the work of the FBI New Orleans Field Office. Assistance was provided by the DEA New Orleans Field Division, the New Orleans Police Department, the Major Crimes Task Force, the FBI Kansas City Division (Jefferson City Resident Office), and the St. Louis County Police Department. Assistant United States Attorneys Matthew Payne, Shirin Hakimzadeh, and Andre Lagarde are in charge of prosecution.
New Orleans Man Sentenced to 10 Years for Operating Heroin Conspiracy in New Orleans EastRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that MICHAEL DAVID SORINA, JR., age 38, resident of Slidell, was sentenced after previously pleading guilty to
conspiracy to distribute and possess with intent to distribute one kilogram or more of heroin.
U.S. District Judge Carl J. Barbier sentenced SORINA to 120 months incarceration, followed by 10 years of supervised release.
On July 25, 2014, SORINA, was one of 12 defendants charged in a 23-count indictment. According to court documents, this investigation targeted a heroin trafficking organization operating in New Orleans East. This organization was responsible for distributing at least 15 kilograms of heroin in New Orleans. Agents seized approximately $1,200,000 in assets (a combination of vehicles, currency, jewelry and real property) from members of this drug trafficking organization that were acquired with proceeds made from the sale of heroin.
Co-defendants include:
LARRY HARDY pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 90 months incarceration.
AMBROSE WILLIAMS pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 120 months incarceration.
ANTOINETTE KELLY pled guilty to distribution of heroin and was sentenced to 15 months incarceration.
CHRISTOPHER FRANCIS pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 240 months incarceration.
RODNEY MACK pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 120 months incarceration.
THOMAS HARRISON pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 144 months incarceration.
VINCENT P. JONES pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 180 months incarceration.
BETH MARIE NGUYEN pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and was sentenced to 36 months incarceration.
RICKY MARQUETTE BOZEMAN pled guilty to conspiracy to possess with intent to distribute 100 grams or more of heroin and was sentenced to 144 months incarceration.
TERRELL CARNEY pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and is scheduled to be sentenced on 7/20/2017.
ANTOINE SMITH pled guilty to conspiracy to possess with intent to distribute one kilogram or more of heroin and is scheduled to be sentenced on 9/21/2017.
Acting U.S. Attorney Evans praised the work of the Drug Enforcement Administration, Kenner Police Department, and Border Patrol in investigating this matter. Assistant United States Attorney Brandon Long is in charge of the prosecution.
New Orleans Man Sentenced for Violation of the Federal Gun Control ActRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that SONNY SCOTT, age 37, of New Orleans, was sentenced today for his conviction stemming from a Federal Gun Control Act violation: possession of a firearm by a convicted felon.
U.S. District Judge Lance M. Africk sentenced SCOTT to 100 months incarceration, followed by 3 years of supervised release, and a mandatory $100 special assessment.
According to court documents, SCOTT was arrested on January 12, 2017. During a search of SCOTT’s person, SCOTT was found to be in possession of approximately $250 in U.S. currency, 3 grams of heroin, approximately 3 grams of cocaine, numerous unidentified pills individually wrapped in clear plastic bags and a loaded .38 caliber special Smith & Wesson revolver. SCOTT had three prior felony convictions, including one from 2002 for armed robbery and was therefore prohibited from possessing a firearm.
Acting U.S. Attorney Evans praised the work of the Drug Enforcement Administration for investigating this matter. Assistant United States Attorney James S. C. Baehr was in charge of the prosecution.
New Orleans Man Sentenced for Heroin Trafficking via MegabusRead the Press Release
Acting U.S. Attorney Duane A. Evans announced that DONALD EALY, a/k/a “Deebo,” age 38, of New Orleans, was sentenced today after previously pleading guilty to conspiring to distribute and possess with intent to distribute one kilogram or more of heroin.
U.S. District Judge Carl J. Barbier sentenced EALY to 60 months incarceration, followed by 5 years of supervised release.
EALY was one of eight defendants charged in a 21-count superseding indictment on September 18, 2015. According to court documents, the superseding indictment originated from an FBI investigation into a heroin-trafficking organization operating primarily around Loyola Avenue and Harmony Street in Central City, New Orleans. The sources of heroin for this organization traveled via Megabus from Houston to New Orleans, carrying half-kilogram quantities of heroin for distribution in the New Orleans area.
The group’s two Houston-based heroin suppliers, defendants MARTHA QUINONES and KEVIN GONZALEZ, each pled guilty to conspiring to distribute and possess with intent to distribute one kilogram or more of heroin, and were sentenced to 120 months and 57 months imprisonment, respectively. Defendant REGINALD WASHINGTON pled guilty to conspiring to distribute and possess with intent to distribute 100 grams or more of heroin, and was sentenced to 120 months imprisonment. Defendants EARL BROWN and WILBERT CLARK pled guilty to conspiring to distribute and possess with intent to distribute a quantity of heroin, and were each sentenced to 30 months imprisonment. Two other defendants, THOMAS GORDON and KENNETH HARRIS, have pled guilty to conspiring to distribute and possess with intent to distribute one kilogram or more of heroin, and will be sentenced on August 24, 2017.
Acting U.S. Attorney Evans praised the work of the Federal Bureau of Investigation New Orleans Gang Task Force (NOGTF), which includes FBI, the Saint Tammany Parish Sheriff’s Office, the Jefferson Parish Sheriff’s Office, and the New Orleans Police Department. Assistant United States Attorney Brandon S. Long was responsible for the prosecution.
Nebraska Men Indicted for Armed RobberiesRead the Press Release
Donald S. Boyce, United States Attorney for the Southern District of Illinois, announced today that two Nebraska men were indicted on July 12, 2017 for conspiracy to interfere with commerce by robbery, four counts of interference with commerce by robbery, and brandishing a firearm during a crime of violence and discharge of a firearm during a crime of violence.
Allen McCray, 19, and Victor Linton, 23, both of Omaha, Nebraska, were charged in a seven count indictment. The indictment alleges that beginning on or about April 12, 2017 and continuing through and including April 21, 2017, McCray and Linton conspired and did commit a series of four armed robberies of MotoMart, Circle K, and Casey’s General Store on April 15, 2017 and Prime Sole on April 19, 2017 within the Southern District of Illinois. The indictment also alleges that a firearm was brandished or discharged at each of these robberies.
The conspiracy and robbery offenses carry up to a maximum of 20 years of imprisonment, to be followed by up to three years of supervised release and a fine up to $250,000. Brandishing a firearm during a crime of violence carries a mandatory minimum sentence of seven years to life imprisonment, to be followed by five years supervised release, and a fine up to $250,000. For a second or subsequent conviction under this section, the minimum sentence is not less than 25 years of imprisonment up to life imprisonment. Discharging a firearm during a crime of violence carries a mandatory minimum sentence of ten years to life imprisonment, followed by five years of supervised release, and a fine up to $250,000. For a second or subsequent conviction under this section, the minimum sentence is not less than 25 years of imprisonment up to life imprisonment.
An indictment is a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge until proven guilty beyond a reasonable doubt to the satisfaction of a jury.
The ongoing investigation is being conducted by the Federal Bureau of Investigation, the Maryville Police Department, the O’Fallon Police Department, the Troy Police Department, the Effingham Police Department, Illinois State Police, Missouri State Highway Patrol and multiple law enforcement agencies in Illinois, Nebraska, Missouri, and Indiana.
National Healthcare Fraud Takedown Results in Charges Against More Than 400 Individuals, Including Several Chicago-Area Medical ProfessionalsRead the Press Release
CHICAGO — Several Chicago-area medical professionals, including two licensed physicians, are facing federal criminal charges as part of the largest health care fraud enforcement action in Department of Justice history, federal authorities announced today.
The national enforcement action taken by the Medicare Fraud Strike Force involved more than 400 defendants charged in 41 federal districts across the country, including 115 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $1.3 billion in false billings. More than 20 state Medicaid Fraud Control Units participated in today’s arrests. In addition, the HHS Centers for Medicare & Medicaid Services (CMS) is suspending payment to 295 providers, including doctors, nurses and pharmacists.
The national enforcement action was announced by U.S. Attorney General Jeff Sessions and U.S. Department of Health and Human Services Secretary Tom Price, M.D., along with Acting Assistant U.S. Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division; Acting Federal Bureau of Investigation Director Andrew McCabe; Acting Drug Enforcement Administration Administrator Chuck Rosenberg; Inspector General Daniel Levinson of the HHS Office of Inspector General (OIG); IRS-Criminal Investigations Chief Jon Fort; CMS Administrator Seema Verma; and Deputy Director Kelly P. Mayo of the Defense Criminal Investigative Service (DCIS).
Today’s enforcement actions were led and coordinated by the Criminal Division Fraud Section’s Health Care Fraud Unit, in conjunction with its Medicare Fraud Strike Force partners – a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, and State Medicaid Fraud Control Units.
“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” said Attorney General Sessions. “While today is a historic day, the Department's work is not finished. In fact, it is just beginning. We will continue to find, arrest, prosecute, convict, and incarcerate fraudsters and drug dealers wherever they are.”
Several Chicago-area medical professionals, including two doctors, were charged as part of investigations in the Northern District of Illinois, announced Joel R. Levin, Acting United States Attorney for the Northern District of Illinois; Michael J. Anderson, Special Agent-in-Charge of the Chicago office of the FBI; Gabriel L. Grchan, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago; and Lamont Pugh III, Special Agent-in-Charge of the Chicago Regional Office of the U.S. Department of Health and Human Services Office of Inspector General.
“Health care fraud is a serious crime that can have devastating consequences,” said Acting U.S. Attorney Levin. “Our office will continue to vigorously investigate and prosecute those who seek to enrich themselves through fraudulent health care schemes.”
“This week, we arrested once trusted doctors, nurses, and other medical professionals who were corrupted by greed and preyed on the vulnerable utilizing them to bill for services or drugs that were unnecessary or never provided,” said FBI Chicago Special Agent-in-Charge Anderson.
One of the Illinois cases involved BEATTA KABBANI, a licensed physical therapist, who was charged in a 13-count indictment with health care fraud and aggravated identity theft. Kabbani is the owner of MedCare Medical Group in Glenview. The indictment charges Kabbani with submitting more than $2 million in false claims to Blue Cross Blue Shield of Illinois and United Health Care. The charges state that Kabbani used a physician’s National Provider Identification number to substantiate some of those false claims. Kabbani is scheduled to be arraigned on July 26, 2017, before U.S. District Judge Gary Feinerman. The Kabbani case is being handled by Assistant U.S. Attorneys Heather McShain and Matthew Kutcher.
Another Illinois case involved JEFFREY WITEK and STEPHEN HOESLEY, licensed chiropractors who were charged in an 18-count indictment with health care fraud. The charges stem from their alleged participation in a scheme to defraud Blue Cross Blue Shield of Illinois. Witek and Hoesley submitted at least approximately $1.1 million in fraudulent claims to Blue Cross Blue Shield of Illinois that falsely represented that certain health care services were provided to patients, knowing that those services were not actually provided. Witek and Hoesley are scheduled to be arraigned on Aug. 2, 2017, before U.S. District Judge Matthew F. Kennelly. The Witek and Hoesley case is being handled by Special Assistant U.S. Attorney Jared Jodrey.
One of the Illinois investigations involved multiple medical professionals. ZOSIMA VICTUELLES, MYLENE MASICLAT, MARIBEL CABRERA, YASEEN ODEH and MOHAMMAD RAZA KHAN were charged in a 28-count indictment with conspiracy to offer and pay, and to solicit and receive, kickbacks and bribes for the referral of Medicare beneficiaries to Sure Care Home Health Corp. The indictment also charges substantive violations of the anti-kickback statute. Victuelles, Masiclat and Cabrera were the owners of Sure Care, a home health agency with offices in Glendale Heights and Rockford. Victuelles and Cabrera are also licensed nurses, while Odeh and Khan are licensed medical doctors. The charges stem from Victuelles, Masiclat, Cabrera and others paying Dr. Odeh, Dr. Khan and others more than $435,000 in kickbacks and bribes for the referral of Medicare beneficiaries to Sure Care. Arraignments in federal court in Chicago have not yet been scheduled. The case is being handled by Assistant U.S. Attorney Matthew Madden.
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged more than 3,500 defendants who collectively have falsely billed the Medicare program for more than $12.5 billion.
The public is reminded that an indictment is merely an allegation, and all defendants are presumed innocent until proven guilty.
National Health Care Fraud Takedown Results in Charges Against over 412 Individuals Responsible for $1.3 Billion in Fraud LossesRead the Press Release
Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts, including 115 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $1.3 billion in false billings. Of those charged, over 120 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS has initiated suspension actions against 295 providers, including doctors, nurses and pharmacists.
Attorney General Sessions and Secretary Price were joined in the announcement by Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting Director Andrew McCabe of the FBI, Acting Administrator Chuck Rosenberg of the Drug Enforcement Administration (DEA), Inspector General Daniel Levinson of the HHS Office of Inspector General (OIG), Chief Don Fort of IRS Criminal Investigation, Administrator Seema Verma of the Centers for Medicare and Medicaid Services (CMS), and Deputy Director Kelly P. Mayo of the Defense Criminal Investigative Service (DCIS).
Today’s enforcement actions were led and coordinated by the Criminal Division, Fraud Section’s Health Care Fraud Unit in conjunction with its Medicare Fraud Strike Force (MFSF) partners, a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, and State Medicaid Fraud Control Units.
The charges announced today aggressively target schemes billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics, a particular focus for the Department. According to the CDC, approximately 91 Americans die every day of an opioid related overdose.
“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” said Attorney General Sessions. “Amazingly, some have made their practices into multimillion dollar criminal enterprises. They seem oblivious to the disastrous consequences of their greed. Their actions not only enrich themselves often at the expense of taxpayers but also feed addictions and cause addictions to start. The consequences are real: emergency rooms, jail cells, futures lost, and graveyards. While today is a historic day, the Department's work is not finished. In fact, it is just beginning. We will continue to find, arrest, prosecute, convict, and incarcerate fraudsters and drug dealers wherever they are.”
“Healthcare fraud is not only a criminal act that costs billions of taxpayer dollars - it is an affront to all Americans who rely on our national healthcare programs for access to critical healthcare services and a violation of trust,” said Secretary Price. “The United States is home to the world’s best medical professionals, but their ability to provide affordable, high-quality care to their patients is jeopardized every time a criminal commits healthcare fraud. That is why this Administration is committed to bringing these criminals to justice, as President Trump demonstrated in his 2017 budget request calling for a new $70 million investment in the Health Care Fraud and Abuse Control Program. The historic results of this year’s national takedown represent significant progress toward protecting the integrity and sustainability of Medicare and Medicaid, which we will continue to build upon in the years to come.”
According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare, Medicaid and TRICARE for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed. The number of medical professionals charged is particularly significant, because virtually every health care fraud scheme requires a corrupt medical professional to be involved in order for Medicare or Medicaid to pay the fraudulent claims. Aggressively pursuing corrupt medical professionals not only has a deterrent effect on other medical professionals, but also ensures that their licenses can no longer be used to bilk the system.
“This week, thanks to the work of dedicated investigators and analysts, we arrested once-trusted doctors, pharmacists and other medical professionals who were corrupted by greed,” said Acting Director McCabe. “The FBI is committed to working with our partners on the front lines of the fight against heath care fraud to stop those who steal from the government and deceive the American public.”
“Health care fraud is a reprehensible crime. It not only represents a theft from taxpayers who fund these vital programs, but impacts the millions of Americans who rely on Medicare and Medicaid,” said Inspector General Levinson. “In the worst fraud cases, greed overpowers care, putting patients’ health at risk. OIG will continue to play a vital leadership role in the Medicare Fraud Strike Force to track down those who abuse important federal health care programs.”
“Our enforcement actions underscore the commitment of the Defense Criminal Investigative Service and our partners to vigorously investigate fraud perpetrated against the DoD's TRICARE Program. We will continue to relentlessly investigate health care fraud, ensure the taxpayers' health care dollars are properly spent, and endeavor to guarantee our service members, military retirees, and their dependents receive the high standard of care they deserve,” advised Deputy Director Mayo.
“Last year, an estimated 59,000 Americans died from a drug overdose, many linked to the misuse of prescription drugs. This is, quite simply, an epidemic,” said Acting Administrator Rosenberg. “There is a great responsibility that goes along with handling controlled prescription drugs, and DEA and its partners remain absolutely committed to fighting the opioid epidemic using all the tools at our disposal.”
“Every defendant in today’s announcement shares one common trait - greed,” said Chief Fort. “The desire for money and material items drove these individuals to perpetrate crimes against our healthcare system and prey upon many of the vulnerable in our society. Thanks to the financial expertise and diligence of IRS-CI special agents, who worked side-by-side with other federal, state and local law enforcement officers to uncover these schemes, these criminals are off the street and will now face the consequences of their actions.”
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
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For the Strike Force locations, in the Southern District of Florida, a total of 77 defendants were charged with offenses relating to their participation in various fraud schemes involving over $141 million in false billings for services including home health care, mental health services and pharmacy fraud. In one case, the owner and operator of a purported addiction treatment center and home for recovering addicts and one other individual were charged in a scheme involving the submission of over $58 million in fraudulent medical insurance claims for purported drug treatment services. The allegations include actively recruiting addicted patients to move to South Florida so that the co-conspirators could bill insurance companies for fraudulent treatment and testing, in return for which, the co-conspirators offered kickbacks to patients in the form of gift cards, free airline travel, trips to casinos and strip clubs, and drugs.
In the Eastern District of Michigan, 32 defendants face charges for their alleged roles in fraud, kickback, money laundering and drug diversion schemes involving approximately $218 million in false claims for services that were medically unnecessary or never rendered. In one case, nine defendants, including six physicians, were charged with prescribing medically unnecessary controlled substances, some of which were sold on the street, and billing Medicare for $164 million in facet joint injections, drug testing, and other procedures that were medically unnecessary and/or not provided.
In the Southern District of Texas, 26 individuals were charged in cases involving over $66 million in alleged fraud. Among these defendants are a physician and a clinic owner who were indicted on one count of conspiracy to distribute and dispense controlled substances and three substantive counts of distribution of controlled substances in connection with a purported pain management clinic that is alleged to have been the highest prescribing hydrocodone clinic in Houston, where approximately 60-70 people were seen daily, and were issued medically unnecessary prescriptions for hydrocodone in exchange for approximately $300 cash per visit.
In the Central District of California, 17 defendants were charged for their roles in schemes to defraud Medicare out of approximately $147 million. Two of these defendants were indicted for their alleged involvement in a $41.5 million scheme to defraud Medicare and a private insurer. This was purportedly done by submitting fraudulent claims, and receiving payments for, prescription drugs that were not filled by the pharmacy nor given to patients.
In the Northern District of Illinois, 15 individuals were charged in cases related to six different schemes concerning home health care services and physical therapy fraud, kickbacks, and mail and wire fraud. These schemes involved allegedly over $12.7 million in fraudulent billing. One case allegedly involved $7 million in fraudulent billing to Medicare for home health services that were not necessary nor rendered.
In the Middle District of Florida, 10 individuals were charged with participating in a variety of schemes involving almost $14 million in fraudulent billing. In one case, three defendants were charged in a $4 million scheme to defraud the TRICARE program. In that case, it is alleged that a defendant falsely represented himself to be a retired Lieutenant Commander of the United States Navy Submarine Service. It is alleged that he did so in order to gain the trust and personal identifying information from TRICARE beneficiaries, many of whom were members and veterans of the armed forces, for use in the scheme.
In the Eastern District of New York, ten individuals were charged with participating in a variety of schemes including kickbacks, services not rendered, and money laundering involving over $151 million in fraudulent billings to Medicare and Medicaid. Approximately $100 million of those fraudulent billings were allegedly part of a scheme in which five health care professionals paid illegal kickbacks in exchange for patient referrals to their own clinics.
In the Southern Louisiana Strike Force, operating in the Middle and Eastern Districts of Louisiana as well as the Southern District of Mississippi, seven defendants were charged in connection with health care fraud, wire fraud, and kickback schemes involving more than $207 million in fraudulent billing. One case involved a pharmacist who was charged with submitting and causing the submission of $192 million in false and fraudulent claims to TRICARE and other health care benefit programs for dispensing compounded medications that were not medically necessary and often based on prescriptions induced by illegal kickback payments.
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In addition to the Strike Force locations, today’s enforcement actions include cases and investigations brought by an additional 31 U.S. Attorney’s Offices, including the execution of search warrants in investigations conducted by the Eastern District of California and the Northern District of Ohio.
In the Northern and Southern Districts of Alabama, three defendants were charged for their roles in two health care fraud schemes involving pharmacy fraud and drug diversion.
In the Eastern District of Arkansas, 24 defendants were charged for their roles in three drug diversion schemes that were all investigated by the DEA.
In the Northern and Southern Districts of California, four defendants, including a physician, were charged for their roles in a drug diversion scheme and a health care fraud scheme involving kickbacks.
In the District of Connecticut, three defendants were charged in two health care fraud schemes, including a scheme involving two physicians who fraudulently billed Medicaid for services that were not rendered and for the provision of oxycodone with knowledge that the prescriptions were not medically necessary.
In the Northern and Southern Districts of Georgia, three defendants were charged in two health care fraud schemes involving nearly $1.5 million in fraudulent billing.
In the Southern District of Illinois, five defendants were charged in five separate schemes to defraud the Medicaid program.
In the Northern and Southern Districts of Indiana, at least five defendants were charged in various health care fraud schemes related to the unlawful distribution and dispensing of controlled substances, kickbacks, and services not rendered.
In the Southern District of Iowa, five defendants were charged in two schemes involving the distribution of opioids.
In the Western District of Kentucky, 11 defendants were charged with defrauding the Medicaid program. In one case, four defendants, including three medical professionals, were charged with distributing controlled substances and fraudulently billing the Medicaid program.
In the District of Maine, an office manager was charged with embezzling funds from a medical office.
In the Eastern and Western Districts of Missouri, 16 defendants were charged in schemes involving over $16 million in claims, including 10 defendants charged as part of a scheme involving fraudulent lab testing.
In the District of Nebraska, a dentist was charged with defrauding the Medicaid program.
In the District of Nevada, two defendants, including a physician, were charged in a scheme involving false hospice claims.
In the Northern, Southern, and Western Districts of New York, five defendants, including two physicians and two pharmacists, were charged in schemes involving drug diversion and pharmacy fraud.
In the Southern District of Ohio, five defendants, including four physicians, were charged in connection with schemes involving $12 million in claims to the Medicaid program.
In the District of Puerto Rico, 13 defendants, including three physicians and two pharmacists, were charged in four schemes involving drug diversion, Medicaid fraud, and the theft of funds from a health care program.
In the Eastern District of Tennessee, three defendants were charged in a scheme involving fraudulent billings and the distribution of opioids.
In the Eastern, Northern, and Western Districts of Texas, nine defendants were charged in schemes involving over $42 million in fraudulent billing, including a scheme involving false claims for compounded medications.
In the District of Utah, a nurse practitioner was charged in connection with fraudulently obtaining a controlled substance, tampering with a consumer product, and infecting over seven individuals with Hepatitis C.
In the Eastern District of Virginia, a defendant was charged in connection with a scheme involving identify theft and fraudulent billings to the Medicaid program.
In addition, in the states of Arizona, Arkansas, California, Delaware, Illinois, Iowa, Louisiana, Massachusetts, Michigan, Minnesota, Mississippi, New York, Oklahoma, Pennsylvania, Rhode Island, South Dakota, Texas, Utah, Vermont, Washington and Wisconsin, 96 defendants have been charged in criminal and civil actions with defrauding the Medicaid program out of over $31 million. These cases were investigated by each state’s respective Medicaid Fraud Control Units. In addition, the Medicaid Fraud Control Units of the states of Alabama, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Missouri, Nebraska, New York, North Carolina, Ohio, Texas, and Utah participated in the investigation of many of the federal cases discussed above.
The cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide, along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois and the Middle District of Florida; and agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.
A complaint, information, or indictment is merely an allegation, and all defendants are presumed innocent unless and until proven guilty.
Additional documents related to this announcement will shortly be available here: https://www.justice.gov/opa/documents-and-resources-july-13-2017.
This operation also highlights the great work being done by the Department of Justice’s Civil Division. In the past fiscal year, the Department of Justice, including the Civil Division, has collectively won or negotiated over $2.5 billion in judgements and settlements related to matters alleging health care fraud.
National Health Care Fraud Takedown Results in Charges Against over 412 Individuals Responsible for $1.3 Billion in Fraud LossesRead the Press Release
WASHINGTON – Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts, including 115 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $1.3 billion in false billings. Of those charged, over 120 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS has initiated suspension actions against 295 providers, including doctors, nurses and pharmacists.
Attorney General Sessions and Secretary Price were joined in the announcement by Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting Director Andrew McCabe of the FBI, Acting Administrator Chuck Rosenberg of the Drug Enforcement Administration (DEA), Inspector General Daniel Levinson of the HHS Office of Inspector General (OIG), Chief Don Fort of IRS Criminal Investigation, Administrator Seema Verma of the Centers for Medicare and Medicaid Services (CMS), and Deputy Director Kelly P. Mayo of the Defense Criminal Investigative Service (DCIS).
Today’s enforcement actions were led and coordinated by the Criminal Division, Fraud Section’s Health Care Fraud Unit in conjunction with its Medicare Fraud Strike Force (MFSF) partners, a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, and State Medicaid Fraud Control Units.
The charges announced today aggressively target schemes billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics, a particular focus for the Department. According to the CDC, approximately 91 Americans die every day of an opioid related overdose.
“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” said Attorney General Sessions. “Amazingly, some have made their practices into multimillion dollar criminal enterprises. They seem oblivious to the disastrous consequences of their greed. Their actions not only enrich themselves often at the expense of taxpayers but also feed addictions and cause addictions to start. The consequences are real: emergency rooms, jail cells, futures lost, and graveyards. While today is a historic day, the Department's work is not finished. In fact, it is just beginning. We will continue to find, arrest, prosecute, convict, and incarcerate fraudsters and drug dealers wherever they are.”
“Healthcare fraud is not only a criminal act that costs billions of taxpayer dollars - it is an affront to all Americans who rely on our national healthcare programs for access to critical healthcare services and a violation of trust,” said Secretary Price. “The United States is home to the world’s best medical professionals, but their ability to provide affordable, high-quality care to their patients is jeopardized every time a criminal commits healthcare fraud. That is why this Administration is committed to bringing these criminals to justice, as President Trump demonstrated in his 2017 budget request calling for a new $70 million investment in the Health Care Fraud and Abuse Control Program. The historic results of this year’s national takedown represent significant progress toward protecting the integrity and sustainability of Medicare and Medicaid, which we will continue to build upon in the years to come.”
According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare, Medicaid and TRICARE for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed. The number of medical professionals charged is particularly significant, because virtually every health care fraud scheme requires a corrupt medical professional to be involved in order for Medicare or Medicaid to pay the fraudulent claims. Aggressively pursuing corrupt medical professionals not only has a deterrent effect on other medical professionals, but also ensures that their licenses can no longer be used to bilk the system.
“This week, thanks to the work of dedicated investigators and analysts, we arrested once-trusted doctors, pharmacists and other medical professionals who were corrupted by greed,” said Acting Director McCabe. “The FBI is committed to working with our partners on the front lines of the fight against heath care fraud to stop those who steal from the government and deceive the American public.”
“Health care fraud is a reprehensible crime. It not only represents a theft from taxpayers who fund these vital programs, but impacts the millions of Americans who rely on Medicare and Medicaid,” said Inspector General Levinson. “In the worst fraud cases, greed overpowers care, putting patients’ health at risk. OIG will continue to play a vital leadership role in the Medicare Fraud Strike Force to track down those who abuse important federal health care programs.”
“Our enforcement actions underscore the commitment of the Defense Criminal Investigative Service and our partners to vigorously investigate fraud perpetrated against the DoD's TRICARE Program. We will continue to relentlessly investigate health care fraud, ensure the taxpayers' health care dollars are properly spent, and endeavor to guarantee our service members, military retirees, and their dependents receive the high standard of care they deserve,” advised Deputy Director Mayo.
“Last year, an estimated 59,000 Americans died from a drug overdose, many linked to the misuse of prescription drugs. This is, quite simply, an epidemic,” said Acting Administrator Rosenberg. “There is a great responsibility that goes along with handling controlled prescription drugs, and DEA and its partners remain absolutely committed to fighting the opioid epidemic using all the tools at our disposal.”
“Every defendant in today’s announcement shares one common trait - greed,” said Chief Fort. “The desire for money and material items drove these individuals to perpetrate crimes against our healthcare system and prey upon many of the vulnerable in our society. Thanks to the financial expertise and diligence of IRS-CI special agents, who worked side-by-side with other federal, state and local law enforcement officers to uncover these schemes, these criminals are off the street and will now face the consequences of their actions.”
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
*********
For the Strike Force locations, in the Southern District of Florida, a total of 77 defendants were charged with offenses relating to their participation in various fraud schemes involving over $141 million in false billings for services including home health care, mental health services and pharmacy fraud. In one case, the owner and operator of a purported addiction treatment center and home for recovering addicts and one other individual were charged in a scheme involving the submission of over $58 million in fraudulent medical insurance claims for purported drug treatment services. The allegations include actively recruiting addicted patients to move to South Florida so that the co-conspirators could bill insurance companies for fraudulent treatment and testing, in return for which, the co-conspirators offered kickbacks to patients in the form of gift cards, free airline travel, trips to casinos and strip clubs, and drugs.
In the Eastern District of Michigan, 32 defendants face charges for their alleged roles in fraud, kickback, money laundering and drug diversion schemes involving approximately $218 million in false claims for services that were medically unnecessary or never rendered. In one case, nine defendants, including six physicians, were charged with prescribing medically unnecessary controlled substances, some of which were sold on the street, and billing Medicare for $164 million in facet joint injections, drug testing, and other procedures that were medically unnecessary and/or not provided.
In the Southern District of Texas, 26 individuals were charged in cases involving over $66 million in alleged fraud. Among these defendants are a physician and a clinic owner who were indicted on one count of conspiracy to distribute and dispense controlled substances and three substantive counts of distribution of controlled substances in connection with a purported pain management clinic that is alleged to have been the highest prescribing hydrocodone clinic in Houston, where approximately 60-70 people were seen daily, and were issued medically unnecessary prescriptions for hydrocodone in exchange for approximately $300 cash per visit.
In the Central District of California, 17 defendants were charged for their roles in schemes to defraud Medicare out of approximately $147 million. Two of these defendants were indicted for their alleged involvement in a $41.5 million scheme to defraud Medicare and a private insurer. This was purportedly done by submitting fraudulent claims, and receiving payments for, prescription drugs that were not filled by the pharmacy nor given to patients.
In the Northern District of Illinois, 15 individuals were charged in cases related to six different schemes concerning home health care services and physical therapy fraud, kickbacks, and mail and wire fraud. These schemes involved allegedly over $12.7 million in fraudulent billing. One case allegedly involved $7 million in fraudulent billing to Medicare for home health services that were not necessary nor rendered.
In the Middle District of Florida, 10 individuals were charged with participating in a variety of schemes involving almost $14 million in fraudulent billing. In one case, three defendants were charged in a $4 million scheme to defraud the TRICARE program. In that case, it is alleged that a defendant falsely represented himself to be a retired Lieutenant Commander of the United States Navy Submarine Service. It is alleged that he did so in order to gain the trust and personal identifying information from TRICARE beneficiaries, many of whom were members and veterans of the armed forces, for use in the scheme.
In the Eastern District of New York, ten individuals were charged with participating in a variety of schemes including kickbacks, services not rendered, and money laundering involving over $151 million in fraudulent billings to Medicare and Medicaid. Approximately $100 million of those fraudulent billings were allegedly part of a scheme in which five health care professionals paid illegal kickbacks in exchange for patient referrals to their own clinics.
In the Southern Louisiana Strike Force, operating in the Middle and Eastern Districts of Louisiana as well as the Southern District of Mississippi, seven defendants were charged in connection with health care fraud, wire fraud, and kickback schemes involving more than $207 million in fraudulent billing. One case involved a pharmacist who was charged with submitting and causing the submission of $192 million in false and fraudulent claims to TRICARE and other health care benefit programs for dispensing compounded medications that were not medically necessary and often based on prescriptions induced by illegal kickback payments.
*********
In addition to the Strike Force locations, today’s enforcement actions include cases and investigations brought by an additional 31 U.S. Attorney’s Offices, including the execution of search warrants in investigations conducted by the Eastern District of California and the Northern District of Ohio.
In the Northern and Southern Districts of Alabama, three defendants were charged for their roles in two health care fraud schemes involving pharmacy fraud and drug diversion.
In the Eastern District of Arkansas, 24 defendants were charged for their roles in three drug diversion schemes that were all investigated by the DEA.
In the Northern and Southern Districts of California, four defendants, including a physician, were charged for their roles in a drug diversion scheme and a health care fraud scheme involving kickbacks.
In the District of Connecticut, three defendants were charged in two health care fraud schemes, including a scheme involving two physicians who fraudulently billed Medicaid for services that were not rendered and for the provision of oxycodone with knowledge that the prescriptions were not medically necessary.
In the Northern and Southern Districts of Georgia, three defendants were charged in two health care fraud schemes involving nearly $1.5 million in fraudulent billing.
In the Southern District of Illinois, five defendants were charged in five separate schemes to defraud the Medicaid program.
In the Northern and Southern Districts of Indiana, at least five defendants were charged in various health care fraud schemes related to the unlawful distribution and dispensing of controlled substances, kickbacks, and services not rendered.
In the Southern District of Iowa, five defendants were charged in two schemes involving the distribution of opioids.
In the Western District of Kentucky, 11 defendants were charged with defrauding the Medicaid program. In one case, four defendants, including three medical professionals, were charged with distributing controlled substances and fraudulently billing the Medicaid program.
In the District of Maine, an office manager was charged with embezzling funds from a medical office.
In the Eastern and Western Districts of Missouri, 16 defendants were charged in schemes involving over $16 million in claims, including 10 defendants charged as part of a scheme involving fraudulent lab testing.
In the District of Nebraska, a dentist was charged with defrauding the Medicaid program.
In the District of Nevada, two defendants, including a physician, were charged in a scheme involving false hospice claims.
In the Northern, Southern, and Western Districts of New York, five defendants, including two physicians and two pharmacists, were charged in schemes involving drug diversion and pharmacy fraud.
In the Southern District of Ohio, five defendants, including four physicians, were charged in connection with schemes involving $12 million in claims to the Medicaid program.
In the District of Puerto Rico, 13 defendants, including three physicians and two pharmacists, were charged in four schemes involving drug diversion, Medicaid fraud, and the theft of funds from a health care program.
In the Eastern District of Tennessee, three defendants were charged in a scheme involving fraudulent billings and the distribution of opioids.
In the Eastern, Northern, and Western Districts of Texas, nine defendants were charged in schemes involving over $42 million in fraudulent billing, including a scheme involving false claims for compounded medications.
In the District of Utah, a nurse practitioner was charged in connection with fraudulently obtaining a controlled substance, tampering with a consumer product, and infecting over seven individuals with Hepatitis C.
In the Eastern District of Virginia, a defendant was charged in connection with a scheme involving identify theft and fraudulent billings to the Medicaid program.
In addition, in the states of Arizona, Arkansas, California, Delaware, Illinois, Iowa, Louisiana, Massachusetts, Michigan, Minnesota, Mississippi, New York, Oklahoma, Pennsylvania, Rhode Island, South Dakota, Texas, Utah, Vermont and Washington, 96 defendants have been charged in criminal and civil actions with defrauding the Medicaid program out of over $31 million. These cases were investigated by each state’s respective Medicaid Fraud Control Units. In addition, the Medicaid Fraud Control Units of the states of Alabama, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Missouri, Nebraska, New York, North Carolina, Ohio, Texas, and Utah participated in the investigation of many of the federal cases discussed above.
The cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide, along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois and the Middle District of Florida; and agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.
A complaint, information, or indictment is merely an allegation, and all defendants are presumed innocent unless and until proven guilty.
Additional documents related to this announcement will shortly be available here: https://www.justice.gov/opa/documents-and-resources-july-13-2017.
This operation also highlights the great work being done by the Department of Justice’s Civil Division. In the past fiscal year, the Department of Justice, including the Civil Division, has collectively won or negotiated over $2.5 billion in judgements and settlements related to matters alleging health care fraud.
National Health Care Fraud Takedown Results in Charges Against 412 IndividualsRead the Press Release
Five Individuals Arrested on Opioid Charges in Southern District of Iowa
WASHINGTON - Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts. Of those charged, over 120 defendants were charged for their roles in prescribing and distributing opioids and other dangerous narcotics.
Today’s enforcement actions were led and coordinated by the Criminal Division, Fraud Section’s Health Care Fraud Unit in conjunction with its Medicare Fraud Strike Force (MFSF) partners, a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, and State Medicaid Fraud Control Units.
Nationally, the defendants announced today are charged with various health care fraud-related crimes, including conspiracy to commit health care fraud, violations of the anti-kickback statutes and money laundering, as well as crimes involving the illegal prescribing and distribution of opioids and other dangerous narcotics. The charges announced today aggressively target schemes billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic. According to the CDC, approximately 91 Americans die every day of an opioid related overdose.
Five individuals were indicted in the Southern District of Iowa in two schemes involving the distribution of opioids, announced United States Attorney Kevin E. VanderSchel. Shawne Marie Widener, age 47, of Hamburg, Iowa, was charged with multiple counts of possession with intent to distribute hydrocodone and oxycodone. Mark Edward May, age 31; Chiann May Jones, age 32; Clara Ann Milks, age 37; and Jeremiah D. Jones, age 40; all of Missouri Valley, Iowa, were charged with conspiracy and distribution of hydrocodone and oxycodone. The public is reminded that an indictment is merely an allegation, and all individuals are presumed innocent unless and until proven guilty.
These Iowa matters were investigated by the Department of Health and Human Services – Office of the Inspector General (HHS-OIG), Drug Enforcement Administration (DEA), Iowa Department of Public Safety - Division of Narcotics Enforcement, and the Iowa Medicaid Fraud Control Unit. These cases are being prosecuted by the United States Attorney’s Office for the Southern District of Iowa
National Health Care Fraud Takedown Results in Charges against over 412 Individuals Responsible for $1.3 Billion in Fraud LossesRead the Press Release
Largest Health Care Fraud Enforcement Action in Department of Justice History
WASHINGTON – Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts, including 115 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $1.3 billion in false billings. Of those charged, over 120 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS has initiated suspension actions against 295 providers, including doctors, nurses and pharmacists.
Attorney General Sessions and Secretary Price were joined in the announcement by Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting Director Andrew McCabe of the FBI, Acting Administrator Chuck Rosenberg of the Drug Enforcement Administration (DEA), Inspector General Daniel Levinson of the HHS Office of Inspector General (OIG), Chief Don Fort of IRS Criminal Investigation, Administrator Seema Verma of the Centers for Medicare and Medicaid Services (CMS), and Deputy Director Kelly P. Mayo of the Defense Criminal Investigative Service (DCIS).
Today’s enforcement actions were led and coordinated by the Criminal Division, Fraud Section’s Health Care Fraud Unit in conjunction with its Medicare Fraud Strike Force (MFSF) partners, a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, and State Medicaid Fraud Control Units.
charges announced today aggressively target schemes billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics, a particular focus for the Department. According to the CDC, approximately 91 Americans die every day of an opioid related overdose.
“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” said Attorney General Sessions. “Amazingly, some have made their practices into multimillion dollar criminal enterprises. They seem oblivious to the disastrous consequences of their greed. Their actions not only enrich themselves often at the expense of taxpayers but also feed addictions and cause addictions to start. The consequences are real: emergency rooms, jail cells, futures lost, and graveyards. While today is a historic day, the Department's work is not finished. In fact, it is just beginning. We will continue to find, arrest, prosecute, convict, and incarcerate fraudsters and drug dealers wherever they are.”
“Healthcare fraud is not only a criminal act that costs billions of taxpayer dollars - it is an affront to all Americans who rely on our national healthcare programs for access to critical healthcare services and a violation of trust,” said Secretary Price. “The United States is home to the world’s best medical professionals, but their ability to provide affordable, high-quality care to their patients is jeopardized every time a criminal commits healthcare fraud. That is why this Administration is committed to bringing these criminals to justice, as President Trump demonstrated in his 2017 budget request calling for a new $70 million investment in the Health Care Fraud and Abuse Control Program. The historic results of this year’s national takedown represent significant progress toward protecting the integrity and sustainability of Medicare and Medicaid, which we will continue to build upon in the years to come.”
According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare, Medicaid and TRICARE for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed. The number of medical professionals charged is particularly significant, because virtually every health care fraud scheme requires a corrupt medical professional to be involved in order for Medicare or Medicaid to pay the fraudulent claims. Aggressively pursuing corrupt medical professionals not only has a deterrent effect on other medical professionals, but also ensures that their licenses can no longer be used to bilk the system.
“This week, thanks to the work of dedicated investigators and analysts, we arrested once-trusted doctors, pharmacists and other medical professionals who were corrupted by greed,” said Acting Director McCabe. “The FBI is committed to working with our partners on the front lines of the fight against heath care fraud to stop those who steal from the government and deceive the American public.”
“Health care fraud is a reprehensible crime. It not only represents a theft from taxpayers who fund these vital programs, but impacts the millions of Americans who rely on Medicare and Medicaid,” said Inspector General Levinson. “In the worst fraud cases, greed overpowers care, putting patients’ health at risk. OIG will continue to play a vital leadership role in the Medicare Fraud Strike Force to track down those who abuse important federal health care programs.”
“Our enforcement actions underscore the commitment of the Defense Criminal Investigative Service and our partners to vigorously investigate fraud perpetrated against the DoD's TRICARE Program. We will continue to relentlessly investigate health care fraud, ensure the taxpayers' health care dollars are properly spent, and endeavor to guarantee our service members, military retirees, and their dependents receive the high standard of care they deserve,” advised Deputy Director Mayo.
“Last year, an estimated 59,000 Americans died from a drug overdose, many linked to the misuse of prescription drugs. This is, quite simply, an epidemic,” said Acting Administrator Rosenberg. “There is a great responsibility that goes along with handling controlled prescription drugs, and DEA and its partners remain absolutely committed to fighting the opioid epidemic using all the tools at our disposal.”
“Every defendant in today’s announcement shares one common trait - greed,” said Chief Fort. “The desire for money and material items drove these individuals to perpetrate crimes against our healthcare system and prey upon many of the vulnerable in our society. Thanks to the financial expertise and diligence of IRS-CI special agents, who worked side-by-side with other federal, state and local law enforcement officers to uncover these schemes, these criminals are off the street and will now face the consequences of their actions.”
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
*********
For the Strike Force locations, in the Southern District of Florida, a total of 77 defendants were charged with offenses relating to their participation in various fraud schemes involving over $141 million in false billings for services including home health care, mental health services and pharmacy fraud. In one case, the owner and operator of a purported addiction treatment center and home for recovering addicts and one other individual were charged in a scheme involving the submission of over $58 million in fraudulent medical insurance claims for purported drug treatment services. The allegations include actively recruiting addicted patients to move to South Florida so that the co-conspirators could bill insurance companies for fraudulent treatment and testing, in return for which, the co-conspirators offered kickbacks to patients in the form of gift cards, free airline travel, trips to casinos and strip clubs, and drugs.
In the Eastern District of Michigan, 32 defendants face charges for their alleged roles in fraud, kickback, money laundering and drug diversion schemes involving approximately $218 million in false claims for services that were medically unnecessary or never rendered. In one case, nine defendants, including six physicians, were charged with prescribing medically unnecessary controlled substances, some of which were sold on the street, and billing Medicare for $164 million in facet joint injections, drug testing, and other procedures that were medically unnecessary and/or not provided.
In the Southern District of Texas, 26 individuals were charged in cases involving over $66 million in alleged fraud. Among these defendants are a physician and a clinic owner who were indicted on one count of conspiracy to distribute and dispense controlled substances and three substantive counts of distribution of controlled substances in connection with a purported pain management clinic that is alleged to have been the highest prescribing hydrocodone clinic in Houston, where approximately 60-70 people were seen daily, and were issued medically unnecessary prescriptions for hydrocodone in exchange for approximately $300 cash per visit.
In the Central District of California, 17 defendants were charged for their roles in schemes to defraud Medicare out of approximately $147 million. Two of these defendants were indicted for their alleged involvement in a $41.5 million scheme to defraud Medicare and a private insurer. This was purportedly done by submitting fraudulent claims, and receiving payments for, prescription drugs that were not filled by the pharmacy nor given to patients.
In the Northern District of Illinois, 15 individuals were charged in cases related to six different schemes concerning home health care services and physical therapy fraud, kickbacks, and mail and wire fraud. These schemes involved allegedly over $12.7 million in fraudulent billing. One case allegedly involved $7 million in fraudulent billing to Medicare for home health services that were not necessary nor rendered.
In the Middle District of Florida, 10 individuals were charged with participating in a variety of schemes involving almost $14 million in fraudulent billing. In one case, three defendants were charged in a $4 million scheme to defraud the TRICARE program. In that case, it is alleged that a defendant falsely represented himself to be a retired Lieutenant Commander of the United States Navy Submarine Service. It is alleged that he did so in order to gain the trust and personal identifying information from TRICARE beneficiaries, many of whom were members and veterans of the armed forces, for use in the scheme.
In the Eastern District of New York, ten individuals were charged with participating in a variety of schemes including kickbacks, services not rendered, and money laundering involving over $151 million in fraudulent billings to Medicare and Medicaid. Approximately $100 million of those fraudulent billings were allegedly part of a scheme in which five health care professionals paid illegal kickbacks in exchange for patient referrals to their own clinics.
In the Southern Louisiana Strike Force, operating in the Middle and Eastern Districts of Louisiana as well as the Southern District of Mississippi, seven defendants were charged in connection with health care fraud, wire fraud, and kickback schemes involving more than $207 million in fraudulent billing. One case involved a pharmacist who was charged with submitting and causing the submission of $192 million in false and fraudulent claims to TRICARE and other health care benefit programs for dispensing compounded medications that were not medically necessary and often based on prescriptions induced by illegal kickback payments.
*********
In addition to the Strike Force locations, today’s enforcement actions include cases and investigations brought by an additional 31 U.S. Attorney’s Offices, including the execution of search warrants in investigations conducted by the Eastern District of California and the Northern District of Ohio.
In the Northern and Southern Districts of Alabama, three defendants were charged for their roles in two health care fraud schemes involving pharmacy fraud and drug diversion.
In the Eastern District of Arkansas, 24 defendants were charged for their roles in three drug diversion schemes that were all investigated by the DEA.
In the Northern and Southern Districts of California, four defendants, including a physician, were charged for their roles in a drug diversion scheme and a health care fraud scheme involving kickbacks.
In the District of Connecticut, three defendants were charged in two health care fraud schemes, including a scheme involving two physicians who fraudulently billed Medicaid for services that were not rendered and for the provision of oxycodone with knowledge that the prescriptions were not medically necessary.
In the Northern and Southern Districts of Georgia, three defendants were charged in two health care fraud schemes involving nearly $1.5 million in fraudulent billing.
In the Southern District of Illinois, five defendants were charged in five separate schemes to defraud the Medicaid program.
In the Northern and Southern Districts of Indiana, at least five defendants were charged in various health care fraud schemes related to the unlawful distribution and dispensing of controlled substances, kickbacks, and services not rendered.
In the Southern District of Iowa, five defendants were charged in two schemes involving the distribution of opioids.
In the Western District of Kentucky, 11 defendants were charged with defrauding the Medicaid program. In one case, four defendants, including three medical professionals, were charged with distributing controlled substances and fraudulently billing the Medicaid program.
In the District of Maine, an office manager was charged with embezzling funds from a medical office.
In the Eastern and Western Districts of Missouri, 16 defendants were charged in schemes involving over $16 million in claims, including 10 defendants charged as part of a scheme involving fraudulent lab testing.
In the District of Nebraska, a dentist was charged with defrauding the Medicaid program.
In the District of Nevada, two defendants, including a physician, were charged in a scheme involving false hospice claims.
In the Northern, Southern, and Western Districts of New York, five defendants, including two physicians and two pharmacists, were charged in schemes involving drug diversion and pharmacy fraud.
In the Southern District of Ohio, five defendants, including four physicians, were charged in connection with schemes involving $12 million in claims to the Medicaid program.
In the District of Puerto Rico, 13 defendants, including three physicians and two pharmacists, were charged in four schemes involving drug diversion, Medicaid fraud, and the theft of funds from a health care program.
In the Eastern District of Tennessee, three defendants were charged in a scheme involving fraudulent billings and the distribution of opioids.
In the Eastern, Northern, and Western Districts of Texas, nine defendants were charged in schemes involving over $42 million in fraudulent billing, including a scheme involving false claims for compounded medications.
In the District of Utah, a nurse practitioner was charged in connection with fraudulently obtaining a controlled substance, tampering with a consumer product, and infecting over seven individuals with Hepatitis C.
In the Eastern District of Virginia, a defendant was charged in connection with a scheme involving identify theft and fraudulent billings to the Medicaid program.
In addition, in the states of Arizona, Arkansas, California, Delaware, Illinois, Iowa, Louisiana, Massachusetts, Michigan, Minnesota, Mississippi, New York, Oklahoma, Pennsylvania, Rhode Island, South Dakota, Texas, Utah, Vermont and Washington, 96 defendants have been charged in criminal and civil actions with defrauding the Medicaid program out of over $31 million. These cases were investigated by each state’s respective Medicaid Fraud Control Units. In addition, the Medicaid Fraud Control Units of the states of Alabama, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Missouri, Nebraska, New York, North Carolina, Ohio, Texas, and Utah participated in the investigation of many of the federal cases discussed above.
The cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide, along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois and the Middle District of Florida; and agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS and state Medicaid Fraud Control Units.
A complaint, information, or indictment is merely an allegation, and all defendants are presumed innocent unless and until proven guilty.
Additional documents related to this announcement will shortly be available here: https://www.justice.gov/opa/documents-and-resources-july-13-2017.
This operation also highlights the great work being done by the Department of Justice’s Civil Division. In the past fiscal year, the Department of Justice, including the Civil Division, has collectively won or negotiated over $2.5 billion in judgements and settlements related to matters alleging health care fraud.
National Health Care Fraud Takedown Results in Charges Against over 412 Individuals Responsible for over $1.3 Billion in Fraud LossesRead the Press Release
WASHINGTON – Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts, including over 115 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving over $1.3 billion in false billings. Of those charged, over 120 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS has initiated suspension against 295 providers, including doctors, nurses, and pharmacists.
Attorney General Sessions and Secretary Price were joined in the announcement by Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting Director Andrew McCabe of the FBI, Acting Administrator Chuck Rosenberg of the Drug Enforcement Administration (DEA), Inspector General Daniel Levinson of the HHS Office of Inspector General (OIG), Chief Don Fort of IRS Criminal Investigation, Administrator Seema Verma of the Centers for Medicare and Medicaid Services (CMS), and Deputy Director Kelly P. Mayo of the Defense Criminal Investigative Service (DCIS).
Today’s enforcement actions were led and coordinated by the Criminal Division, Fraud Section’s Health Care Fraud Unit in conjunction with its Medicare Fraud Strike Force (MFSF) partners, a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, and State Medicaid Fraud Control Units.
The charges announced today aggressively target schemes billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics. According to the Centers for Disease Control, approximately 91 Americans die every day of an opioid related overdose.
“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” said Attorney General Sessions. “Amazingly, some have made their practices into multimillion dollar criminal enterprises. They seem oblivious to the disastrous consequences of their greed. Their actions not only enrich themselves often at the expense of taxpayers but also feed addictions and cause addictions to start. The consequences are real: emergency rooms, jail cells, futures lost, and graveyards. While today is a historic day, the Department's work is not finished. In fact, it is just beginning. We will continue to find, arrest, prosecute, convict, and incarcerate fraudsters and drug dealers wherever they are.”
“Protecting our nation’s health care programs is a top priority of our Office,” said Acting U.S. Attorney Muldrow. “The coordinated actions today demonstrate our resolve to prosecute those who commit fraud against our health care programs. We will continue in our pursuit against those who violate the law to enrich themselves by defrauding our public systems and its customers by stealing from federal health care programs and the American taxpayers.”
According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare, Medicaid, and TRICARE for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed. The number of medical professionals charged is particularly significant, because virtually every health care fraud scheme requires a corrupt medical professional to be involved in order for Medicare or Medicaid to pay the fraudulent claims. Aggressively pursuing corrupt medical professionals not only has a deterrent effect on other medical professionals, but also ensures that their licenses can no longer be used to bilk the system.
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3,500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
The cases announced today are being prosecuted and investigated by U.S. Attorney’s Offices nationwide, along with Medicare Fraud Strike Force teams from the Criminal Division’s Fraud Section and from the U.S. Attorney’s Offices of the Southern District of Florida, Eastern District of Michigan, Eastern District of New York, Southern District of Texas, Central District of California, Eastern District of Louisiana, Northern District of Texas, Northern District of Illinois, and Middle District of Florida; and agents from the FBI, HHS-OIG, Drug Enforcement Administration, DCIS, and state Medicaid Fraud Control Units.
A complaint, information, or indictment is merely an allegation, and all defendants are presumed innocent unless and until proven guilty.
Additional documents related to this announcement will shortly be available here: https://www.justice.gov/opa/documents-and-resources-july-13-2017.
In the Middle District of Florida, 10 individuals were charged with participating in a variety of schemes.
Middle District of Florida Case Highlights
Richard Martin (56, Orlando), a former sales representative for Advanced BioHealing, Inc. (ABH), has been charged with conspiracy to violate the anti-kickback statute and to commit mail and health care fraud. According to court documents, ABH was a biopharmaceutical company that developed and commercialized bioengineered tissue products and regenerative medicine therapies. In 2006, ABH acquired the rights to Dermagraft, a bioengineered skin substitute approved for the treatment of diabetic foot ulcers, and began selling the product to treating physicians. The indictment alleges that in late 2010, Martin and others conspired to bill the Medicare Part B program as if an entire Dermagraft (38 square centimeters) was used to treat each Medicare beneficiary. In truth, Martin and others routinely divided or split the skin substitute into multiple sections for applications on multiple Medicare beneficiaries, resulting in double billing. The indictment further alleges that Martin violated the anti-kickback statute by offering and providing free office medical supplies, free Dermagraft samples, multiple meals and other consumables, and uncompensated medical office procedures and services.
Larry B. Howard (53, Oviedo), a pharmacist and the owner and operator of Fertility Pharmacy d/b/a TRICARE Wellness, has been charged with one count of conspiracy to pay and receive illegal kickbacks, two counts of paying illegal kickbacks, and two counts of money laundering. Nicole R. Bramwell (51, Apopka), a physician, and Raymond L. Stone (57, Orlando), a patient recruiter, have each been charged with one count of conspiracy to pay and receive illegal kickbacks and one count of receiving illegal kickbacks. These charges stem from their alleged roles in a $4.3 million compounding pharmacy scheme that impacted the TRICARE program.
Michael J. Anderson (64, formerly of Windermere), a managing member and operator of DMA Logistics LLC, has been charged with one count of conspiracy to commit health care fraud and wire fraud, and two counts of money laundering. These charges stem from Anderson’s alleged role in a $5.7 million compounding pharmacy fraud scheme that impacted the TRICARE program.
Podiatrist Michael Rotstein (Ocala, 55) has pleaded guilty to one count of healthcare fraud. He faces a maximum penalty of 10 years’ imprisonment and must pay mandatory restitution of approximately $1.5 million. A sentencing date has not yet been set. According to the plea agreement, when billing the Medicare and TRICARE programs Rotstein claimed that nearly half of his procedures were for the removal of skin and muscle, placing him in the top one-percent of billers nationwide for this procedure. In reality, Rotstein did not actually perform these procedures. Rather, the majority of the times that he billed for these procedures, he was actually performing routine foot care, including the clipping of toenails, which is not a reimbursable service under the Medicare or TRICARE program. Since the services performed were not reimbursable, Rotstein devised a scheme to submit claims to Medicare and TRICARE that included using a false diagnosis code and false billing code. As a result of the scheme, Rotstein received $1,504,952.67 in healthcare reimbursements to which he was not entitled.
Jack Gehring (68, Margate) has been charged with trafficking prescription opioids, primarily oxycodone, from late 2010 through 2017. According to the criminal complaint, in addition to acquiring pills himself, Gehring conspired with family members, including his brother, Patrick Gehring (59, Davie), his daughter, Tina Gehring (45, Coral Springs), and several others, including Sean Grelecki (45, Deltona). The conspirators fraudulently acquired and filled prescriptions for thousands of oxycodone pills, and other drugs, in order to illegally distribute them at black market prices of $20 per pill or more. Gehring paid for the health visits and the pharmacy costs for the oxycodone for those who fraudulently acquired pills for him. He also paid the prescription filler $600 to $900 per month, depending on the number of pills acquired. Jack Gehring then distributed thousands of oxycodone pills in Florida, Massachusetts, Connecticut, and elsewhere.
The Middle District of Florida cases are being handled by Assistant U.S. Attorneys Jay Trezevant, Thomas Palermo, Jason Mehta, Jackson Boggs, and DOJ Senior Trial Attorney Christopher Hunter of the Fraud Section.
This operation also highlights the great work being done by the Department of Justice’s Civil Division. In the past fiscal year, the Department of Justice, including the Civil Division, has collectively won or negotiated over $2.5 billion in judgments and settlements related to matters alleging health care fraud.
National Health Care Fraud Takedown Results in Charges Against over 412 Individuals Responsible for $1.3 Billion in Fraud LossesRead the Press Release
WASHINGTON – Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D., announced today the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts, including 115 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $1.3 billion in false billings. Of those charged, over 120 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS has initiated suspension actions against 295 providers, including doctors, nurses and pharmacists.
Attorney General Sessions and Secretary Price were joined in the announcement by Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting Director Andrew McCabe of the FBI, Acting Administrator Chuck Rosenberg of the Drug Enforcement Administration (DEA), Inspector General Daniel Levinson of the HHS Office of Inspector General (OIG), Chief Don Fort of IRS Criminal Investigation, Administrator Seema Verma of the Centers for Medicare and Medicaid Services (CMS), and Deputy Director Kelly P. Mayo of the Defense Criminal Investigative Service (DCIS).
Today’s enforcement actions were led and coordinated by the Criminal Division, Fraud Section’s Health Care Fraud Unit in conjunction with its Medicare Fraud Strike Force (MFSF) partners, a partnership between the Criminal Division, U.S. Attorney’s Offices, the FBI and HHS-OIG. In addition, the operation includes the participation of the DEA, DCIS, and State Medicaid Fraud Control Units.
The charges announced today aggressively target schemes billing Medicare, Medicaid, and TRICARE (a health insurance program for members and veterans of the armed forces and their families) for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics, a particular focus for the Department. According to the CDC, approximately 91 Americans die every day of an opioid related overdose.
“Too many trusted medical professionals like doctors, nurses, and pharmacists have chosen to violate their oaths and put greed ahead of their patients,” said Attorney General Sessions. “Amazingly, some have made their practices into multimillion dollar criminal enterprises. They seem oblivious to the disastrous consequences of their greed. Their actions not only enrich themselves often at the expense of taxpayers but also feed addictions and cause addictions to start. The consequences are real: emergency rooms, jail cells, futures lost, and graveyards. While today is a historic day, the Department's work is not finished. In fact, it is just beginning. We will continue to find, arrest, prosecute, convict, and incarcerate fraudsters and drug dealers wherever they are.”
“Today’s announcement demonstrates the Department of Justice’s commitment to focus investigative resources on individuals who choose to pursue profit over public health. Ultimately, health care fraud deprives the elderly and disabled from benefits they are entitled to receive,” said US Attorney Rosa Emilia Rodríguez-Vélez. “We will continue to aggressively pursue and prosecute those who commit fraud against our nation’s federal healthcare programs.”
“Healthcare fraud is not only a criminal act that costs billions of taxpayer dollars - it is an affront to all Americans who rely on our national healthcare programs for access to critical healthcare services and a violation of trust,” said Secretary Price. “The United States is home to the world’s best medical professionals, but their ability to provide affordable, high-quality care to their patients is jeopardized every time a criminal commits healthcare fraud. That is why this Administration is committed to bringing these criminals to justice, as President Trump demonstrated in his 2017 budget request calling for a new $70 million investment in the Health Care Fraud and Abuse Control Program. The historic results of this year’s national takedown represent significant progress toward protecting the integrity and sustainability of Medicare and Medicaid, which we will continue to build upon in the years to come.”
According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare, Medicaid and TRICARE for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed. The number of medical professionals charged is particularly significant, because virtually every health care fraud scheme requires a corrupt medical professional to be involved in order for Medicare or Medicaid to pay the fraudulent claims. Aggressively pursuing corrupt medical professionals not only has a deterrent effect on other medical professionals, but also ensures that their licenses can no longer be used to bilk the system.
As part of this national effort, the District of Puerto Rico charged 13 individuals in six separate indictments, including three physicians and two pharmacists, in four schemes involving drug diversion, Medicaid fraud, and the theft of funds from a health care program. Defendants Miguel Hernández-Marquez, owner of Farmacia Condado Moderno in Caguas; Guillermo Tirado-Menéndez, a physician specialized in internal medicine with offices located in Caguas and Cidra; Gilberto Figueroa-Trinidad, aka “Chino;” Rebecca Sierra-López, aka “Rebe,” a nurse; William Vélez-Montes, a pharmacist; and Myrna Nevares-Sobrino, a pharmacist, are charged for their participation in a conspiracy to manufacture, distribute and dispense - outside the scope of professional practice and not for a legitimate medical purpose - a controlled substance, that is, at least 70,000 units of Oxycodone (commonly known as Percocet), and at least 40,000 units of Alprazolam (commonly known as Xanax).
In a separate indictment, defendants Hernández-Marquez, Figueroa-Trinidad, Vélez-Montes and Nevares-Sobrino; along with Luis Vélez-Quiñones, a physician specialized in internal medicine with office located in Guánica; and Laura López-Rolón are charged with conspiracy to manufacture, distribute and dispense - outside the scope of professional practice and not for a legitimate medical purpose - a controlled substance, that is, at least 77,000 units of Oxycodone, at least 47,000 units of Alprazolam, and at least 40,000 units of Tramadol.
In a third indictment, Ivette Caraballo-Pérez, aka “Tita” and Steven Velázquez-Pérez are charged with conspiracy to possess with intent to distribute Oxycodone. The fourth indictment charges José Vega-Emmanuelli, a DEA registrant with the authorization to dispense controlled substances, with possession with intent to dispense, outside the scope of professional practice and not for a legitimate medical purpose, Oxycodone and Alprazolam.
Defendant Luz De Alba Quezada-De Jesús, a Postal Service employee, is charged with health care fraud and false statements relating to health care matters. Quezada-De Jesús certified that she was unemployed in order to receive Medicaid benefits, also known as Mi Salud, through First Medical Health Plan Inc. In a separate indictment, Yalixa Flores-Fuentes, employed by MMM Healthcare, LLC is charged with bank fraud, aggravated identity theft, and embezzlement in connection with health care. Flores-Fuentes submitted false invoices for catering services and, using her status as an employee of MMM, caused checks to be drawn which she later cashed for herself.
The cases are being handled by Assistant U.S. Attorneys Teresa Zapata-Valladares, and Susan Z. Jorgensen, and Special Assistant U.S. Attorney Amanda C. Soto-Ortega.
“The arrests conducted in Puerto Rico last Monday as part of the nationwide “Diversion and Health Care Takedown” shed some light to the communities in the island that DEA, other federal and state agencies will target any kind of illicit drug trafficking activity threatening our communities,” stated DEA Special Agent in Charge Matthew G. Donahue. “The opioid addiction issue in the United States has become a national crisis, for this reason we are working hard and proactively to keep our neighborhoods and communities safe and to protect the lives of our citizens. This enforcement operation sends a message to the medical professionals that once they dishonor their Hippocratic Oath, DEA will investigate them and bring any physician or pharmacist to justice that violates federal narcotics laws and regulations. Law enforcement agencies/departments in Puerto Rico are part of our communities support networks and our goals and mandates are to prevent the individuals responsible who are dealing and trafficking in these opioid substances from killing our families and friends selling one baggy, one deck, capsule, and one pill. DEA will stay here, and we will prevail.”
“This indictment is another reminder that the misappropriation of federal funds is illegal and unacceptable,” said Scott J. Lampert, Special Agent in Charge, Office of Inspector General, U.S. Department of Health and Human Services. “HHS-OIG, along with our law enforcement partners, will not tolerate this behavior and will remain vigilant in our efforts to protect the integrity of our federal health care programs.”
Eileen Neff, Special Agent-in-Charge, U.S. Postal Service Office of Inspector General stated: “The U.S. Postal Service Office of Inspector General investigates those who would defraud the Postal Service as well as Postal Service employees alleged to commit fraud against other government programs. We will continue to work closely with our law enforcement partners in investigations such as this and we thank the U.S. Attorney’s Office and HHS-OIG for their assistance with our investigations.”
The Medicare Fraud Strike Force operations are part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
This operation also highlights the great work being done by the Department of Justice’s Civil Division. In the past fiscal year, the Department of Justice, including the Civil Division, has collectively won or negotiated over $2.5 billion in judgements and settlements related to matters alleging health care fraud.
# # #
National Health Care Fraud Takedown Includes Two Central Ohio Companies and Owners Charged with False BillingRead the Press Release
COLUMBUS, Ohio – A federal grand jury has returned separate indictments charging two central Ohio health care companies and the people who own them with health care fraud. One company allegedly billed government insurance programs for unnecessary medical procedures and the other is accused of billing government insurance programs for pain and scar creams that recipients said they never requested or wanted.
The two Ohio cases are part of a nationwide health care fraud takedown announced today by Attorney General Jeff Sessions and Department of Health and Human Services (HHS) Secretary Tom Price, M.D.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio; Lamont Pugh III, Special Agent in Charge, U.S. Department of Health & Human Services; Office of Inspector General – Chicago Region; the Medicaid Fraud Control Unit in Ohio Attorney General Mike DeWine’s Office; Angela Byers, Special Agent in Charge, Federal Bureau of Investigation Cincinnati; Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration (DEA); and Steven W. Schierholt, Executive Director of the Ohio Board of Pharmacy announced the indictments today as part of a nationwide crackdown on fraudulent health care providers.
One indictment alleges that Salim Dahdah who owns and operates the Ohio Institute of Cardiac Care (OICC) in Springfield, and his wife Cindy Dahdah who owns Accubil, a company that handles the billing for OICC, received more than $2 million from Medicare and Medicaid for medically unnecessary nuclear stress tests and medically unnecessary coronary interventions such as pacemaker insertion and stent procedures. The indictment charges them with conspiracy to commit health care fraud and health care fraud, crimes punishable by up to ten years in prison, and health care false statements a crime which carries a maximum sentence of five years in prison.
The grand jury also indicted Darrell Bryant and Gifty Kusi, a husband and wife who own and manage Health & Wellness Pharmacy in Dublin. Kusi and Dr. Jornel Rivera owned and operated Health & Wellness Medical Center, also in Dublin. The indictment alleges that they fraudulently received more than $3 million from the Ohio Department of Medicaid and Medicaid Managed Care Organizations (MCOs) through multiple schemes including billing for compound creams that were not provided or not requested by patients, billing for counseling services that were not provided or billing for group counseling sessions as individual counseling services. The indictment charges all three defendants with conspiracy to commit health care fraud and health care fraud.
“Health care fraud creates victims out of patients, providers, and taxpayers,” U.S. Attorney Glassman said. “It’s a crime that breaks the bonds of trust between doctor and patient, and between government and the people, just for the sake of personal greed.”
“The charges announced today should send a strong message to criminals that theft from vital health care programs will not be tolerated”, said SAC Pugh of HHS Office of Inspector General. “The OIG and our law enforcement partners will continue to be vigilant in our efforts to protect tax payer dollars that are intended to aid our most vulnerable citizens.”
“Both of these cases are egregious,” said Attorney General DeWine. “In the OICC case, the investigation found that patients underwent dangerous and completely unnecessary medical procedures, and in the Health and Wellness Pharmacy case, the investigation found that people who legitimately needed drug treatment and counseling weren’t getting it – even though the company charged for it. In the midst of the opioid epidemic in Ohio, it is critical that healthcare providers are rendering services that are meant to help Ohioans struggling with addiction.”
“Some of the charges described include medically unnecessary procedures performed which could cause patient harm. This is the most egregious form of health care fraud”, said SAC Byers of the FBI, adding that “Health care fraud contributes to rising health care costs for everyone.”
Today’s nationwide enforcement action is the largest ever health care fraud enforcement action by the Medicare Fraud Strike Force, involving 412 charged defendants across 41 federal districts, including 115 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $1.3 billion in false billings. Of those charged, over 120 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS has initiated suspension actions against 295 providers, including doctors, nurses and pharmacists.
U.S. Attorney Glassman commended the investigation of this case by the HHS-OIG, Ohio Attorney General Mike DeWine’s Medicaid Fraud Control Unit and IRS Criminal Investigation, as well as Assistant United States Attorney Kenneth Affeldt and Special Assistant United States Attorney Maritsa Flaherty, who are representing the United States in this case.
An indictment merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
Mount Morris Man Sentenced on Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y.—Acting U.S. Attorney James P. Kennedy, Jr. announced today that Calvin R. Patrick, 35, of Mount Morris, NY, who was convicted of receipt of child pornography, was sentenced to 295 months in prison by Chief U.S. District Judge Frank P. Geraci, Jr.
Assistant U.S. Attorney Tiffany H. Lee, who is handling the case, stated that in the fall of 2015, Patrick enticed two minor females under the age of 18 to send to him sexually explicit pictures of themselves. The defendant used the application known as “Kik” to communicate with a 14-year-old female in Florida and a female in Pennsylvania who was not quite 12 years-old.
The plea is the culmination of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Adam S. Cohen; the Mount Morris Police Department, under the direction of Chief Kenneth Mignemi; the Livingston County Probation Department, under the direction of Director Lynne C. Mignemi; and the Livingston County District Attorney’s Office, under the direction of Gregory J. McCaffrey.
Michigan Real Estate Businessman Sentenced to Prison for Obstructing the Internal Revenue Laws and Bank FraudRead the Press Release
A Michigan business owner was sentenced to serve a year and a day in prison today for obstructing and impeding the internal revenue laws and committing bank fraud, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
According to documents filed with the court, Richard Pierce filed fraudulent 2004 through 2013 individual income tax returns. Those returns failed to report more than $9 million in gross business receipts that several of his real estate businesses earned, including Phoenix Real Estate Company, Phoenix Preferred Properties LLC, Detroit Matrix, First Metro Properties LLC, First Metro Real Estate Services LLC, Phoenix Office Plaza-II LLC, Rosedale/Grandmont Properties LLC, and RFP Ventures LLC. As a result of those fraudulent filings, Pierce caused a tax loss of more than $400,000.
In 2007, Pierce also committed bank fraud by submitting a fraudulent loan application to a mortgage lender on which he failed to disclose that the buyer of a residential property was receiving a kickback from the seller.
In addition to the term of prison imposed, Pierce was ordered to serve two years of supervised release and to pay restitution to the Internal Revenue Service (IRS), the amount of which will be determined at a later date. Pierce pleaded guilty in February 2015.
Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorneys Mark McDonald and Christopher O’Donnell of the Tax Division, who prosecuted the case. Acting Deputy Assistant Attorney General Goldberg also thanked the U.S. Attorney’s Office for the Eastern District of Michigan for their substantial assistance.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
Miami-Based Physician Pleads Guilty for Role in Pain Pill Diversion and Medicare Fraud SchemeRead the Press Release
A licensed physician in Miami pleaded guilty in federal court yesterday for his role in a multi-faceted $4.8 million health care fraud scheme that ran from April 2011 to February 2017, involving the submission of false and fraudulent claims to Medicare and the illegal prescribing of Schedule II (e.g., oxycodone and hydrocodone) and Schedule IV (e.g., alprazolam) controlled substances.
Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Benjamin G. Greenberg of the Southern District of Florida, Special Agent in Charge George L. Piro of the FBI’s Miami Field Office, Special Agent in Charge Shimon R. Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office, and Special Agent in Charge Brian Swain of the U.S. Secret Service’s (USSS) Miami Field Office made the announcement.
Roberto A. Fernandez, M.D., 51, of Miami, pleaded guilty before U.S. District Judge Cecelia M. Altonaga of the Southern District of Florida to one count of conspiracy to commit health care fraud and wire fraud. Sentencing is set for September 20.
According to admissions made as part of his guilty plea, Fernandez referred Medicare beneficiaries to pharmacy owners in exchange for illegal health care kickbacks. Fernandez admitted knowing that the pharmacy owners were billing and receiving reimbursements from Medicare for prescription drugs based upon the prescriptions he sold, and that his patients did not truly need many of the medications he prescribed in exchange for the kickbacks. For example, he admitted providing prescriptions for expensive, name brand drugs, including anti-psychotics and HIV/AIDS medications that were not medically necessary.
Fernandez also solicited referrals of Medicare beneficiaries to his own practices from his co-conspirators, he admitted, including submitting claims to Medicare under his Part B provider number for services he did not, in fact, render to Medicare beneficiaries. Additionally, Fernandez admitted receiving kickbacks in return for signing plans of care and prescriptions for home health services.
Fernandez also admitted that he prescribed controlled substances, including dangerous opioids, to patients and patient recruiters in return for $100 - $200 cash per prescription. Fernandez admitted that he knew these patients did not need the controlled substances he prescribed. Furthermore, Fernandez admitted that he wrote many of these controlled substance prescriptions for patients that he did not even examine.
The FBI, HHS-OIG, and USSS investigated the case, which was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Southern District of Florida. Former Fraud Section Trial Attorney and current Assistant U.S. Attorney Lisa H. Miller of the Southern District of Florida and Fraud Section Trial Attorney Adam G. Yoffie are prosecuting the case.
The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 3,000 defendants who have collectively billed the Medicare program for more than $11 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Mexican men indicted for reentering the U.S.Read the Press Release
Two Mexican men have been indicted for illegally re-entering the country, said Acting U.S. Attorney David A. Sierleja.
Jose Martin Bautista-Mondragon, 46, was found to be in Ohio after being deported in 2014 and 2016, according to the indictment.
Oman Mendiola was found in Ohio after being deported in 2011, according to the indictment.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigating agency in these cases is the Immigration and Customs Enforcement of the Department of Homeland Security. The cases are being handled by Assistant U.S. Attorneys Tracey Ballard Tangeman and Noah Hood.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Medford Woman Sentenced for Stealing Personal Information from Former EmployerRead the Press Release
BOSTON - A former employee of Tufts Health Plan was sentenced today in federal court in Boston for stealing the identifying information of over 8,000 Medicare customers.
Lynrolte Cezaire, 29, of Medford, was sentenced by U.S. District Court Judge George A. O’Toole Jr. to two years and one day in prison and two years of supervised release. Following a seven-day jury trial in April 2017, Cezaire was convicted by a federal jury of unlawfully disclosing Social Security numbers and aggravated identity theft.
During her time as an employee in the Medicare enrollment department at Tufts Health Plan, from 2011 to 2014, Cezaire helped a coworker, Emeline Lubin, photograph Cezaire’s computer screen while it displayed lists of Medicare customers’ names, dates of birth, and Social Security numbers. Lubin then gave the information to Sniders Jean-Jacques, a Florida man who was involved in a scheme with Lubin’s brother, Marvin, to use stolen identities to steal Social Security benefits and to file false tax returns and collect the refunds.
In October 2014, Marvin Lubin was sentenced to one year and one day in prison; in December 2014, Jean-Jacques was sentenced to two years in prison; and in May 2017, Emeline Lubin was sentenced to three months in prison.
Acting United States Attorney William D. Weinreb; Scott Antolik, Special Agent in Charge of the Office of Inspector General, Social Security Administration, Office of Investigations, Boston Field Division; Phillip Coyne, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of the Inspector General; Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Stephen A. Marks, Special Agent in Charge of the U.S. Secret Service, Boston Field Office, made the announcement. Assistance was also provided by the Suffolk County District Attorney’s Office. Assistant U.S. Attorney Robert Richardson of Weinreb’s Major Crimes Unit prosecuted the case.
McLean County Man Sentenced to 5 1/2 Years in Prison for Receiving Child PornographyRead the Press Release
PEORIA, Ill. – A Bloomington, Ill., man, Braman Benjamin Broy, 22, has been sentenced to 68 months (5 years, 8 months) in prison for receiving child pornography. In addition to the prison term, U.S. District Judge Michael M. Mihm ordered that Broy remain on supervised release for eight years following his release from incarceration. Broy will be required to register as a sex offender.
Broy pleaded guilty on Jan. 9, 2017. According to court documents, Broy was a member of Playpen, a hidden website dedicated to sharing child pornography that operated on the Tor network, from August 2014 until March 2015. In February 2015, Broy logged into Playpen and downloaded content depicting the sexual exploitation of children. During a search of his residence, agents located a computer and hard drives that contained more than 2,600 images and 530 videos of child pornography.
Broy has been detained in the custody of the U.S. Marshals Service since his arrest on May 31, 2016.
The case was prosecuted by Assistant U.S. Attorney Ronald L. Hanna, and investigated by the FBI.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.