Tag Archives: Criminal Division-Fraud Section

Two Plead Guilty in Miami for Roles in $63 Million Mental Health Care Fraud Scheme

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Tuesday, November 20, 2012
Two Plead Guilty in Miami for Roles in $63 Million Mental Health Care Fraud Scheme
Two Health Care Professionals Pleaded Guilty This Week for Roles in Multi-State Scheme

WASHINGTON –A registered nurse pleaded guilty today and a former program coordinator pleaded guilty yesterday in connection with a health care fraud scheme involving defunct health provider Health Care Solutions Network Inc. (HCSN), announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Acting Special Agent-in-Charge of the FBI’s Miami Field Office; and Special Agent-in-Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami office.

John Thoen, 53, of Miami, pleaded guilty today before U.S. District Judge Cecilia M. Altonaga in the Southern District of Florida to one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering.  Alexandra Haynes, 36, of Taylor, S.C., pleaded guilty yesterday before Judge Altonaga to one count of conspiracy to commit health care fraud in the same case.

According to court documents, HCSN operated community mental health centers (CMHC) at three locations Miami-Dade County, Fla., and one location in Hendersonville, N.C.  HCSN purported to provide partial hospitalization program (PHP) services to individuals suffering from mental illness.  A PHP is a form of intensive treatment for severe mental illness.

According to an indictment unsealed on May 2, 2012, HCSN obtained Medicare beneficiaries to attend HCSN for purported PHP treatment that was unnecessary and, in many instances, not even provided.  HCSN obtained those beneficiaries in Miami by paying kickbacks to owners and operators of assisted living facilities.

According to court documents, Thoen was a licensed registered nurse in both Florida and North Carolina.  In Florida, Thoen participated in the admission to HCSN of patients who were ineligible for PHP services.  Thoen participated in the routine fabrication of patient medical records that were utilized to support false and fraudulent billing to government sponsored health care benefit programs, including Medicare and Medicaid.

In North Carolina, Thoen, according to court documents, routinely submitted fraudulent PHP claims for Medicare patients who were not even present at the CMHC on days PHP services were purportedly rendered.  Thoen also caused the submission of fraudulent Medicare claims on days the CMHC was closed due to snow.

Thoen also admitted to his role in a money laundering scheme, involving Psychiatric Consulting Network Inc. (PCN), a Florida corporation that was utilized by HCSN as a shell corporation to launder health care fraud proceeds.  According to court documents, Thoen was president of PCN.

According to court documents, Haynes was employed in Miami as an intake specialist and routinely fabricated patient medical records.  In North Carolina, Haynes was employed as a program coordinator and conducted group therapy sessions and fabricated corresponding group therapy notes even though she was not licensed to provide mental health services in the state.

According to court documents, from 2004 through 2011, HCSN billed Medicare and the Florida Medicaid program approximately $63 million for purported mental health services.

Nine defendants have been charged for their alleged roles in the HCSN health care fraud scheme.  Six defendants have pleaded guilty, and three defendants are scheduled for trial on Jan. 14, 2013, before U.S. District Judge Altonaga in Miami. Defendants are presumed innocent until proven guilty at trial.

The cases are being prosecuted by Special Trial Attorney William Parente and Trial Attorney Allan J. Medina of the Criminal Division’s Fraud Section.  This case was investigated by the FBI and HHS-OIG and 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.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion.  In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

Former Executive at Florida-Based Lender Processing Services Inc. Admits Role in Mortgage-Related Document Fraud Scheme

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Tuesday, November 20, 2012
Former Executive at Florida-Based Lender Processing Services Inc. Admits Role in Mortgage-Related Document Fraud Scheme
Over 1 Million Documents Prepared and Filed with Forged and False Signatures, Fraudulent Notarizations

WASHINGTON – A former executive of Lender Processing Services Inc. (LPS) – a publicly traded company based in Jacksonville, Fla. – pleaded guilty today, admitting her participation in a six-year scheme to prepare and file more than 1 million fraudulently signed and notarized mortgage-related documents with property recorders’ offices throughout the United States.

The guilty plea of Lorraine Brown, 56, of Alpharetta, Ga., was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney for the Middle District of Florida Robert E. O’Neill; and Michael Steinbach, Special Agent in Charge of the FBI’s Jacksonville Field Office.

The plea, to conspiracy to commit mail and wire fraud, was entered before U.S. Magistrate Judge Monte C. Richardson in Jacksonville federal court.  Brown faces a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gross gain or loss from the crime.  The date for sentencing has not yet been set.

“Lorraine Brown participated in a scheme to fabricate mortgage-related documents at the height of the financial crisis,” said Assistant Attorney General Breuer.  “She was responsible for more than a million fraudulent documents entering the system, directing company employees to forge and falsify documents relied on by property recorders, title insurers and others.  Appropriately, she now faces the prospect of prison time.”

“Homeownership is a huge step for American citizens,” said U.S. Attorney O’Neill.  “The process itself is often intimidating and lengthy.  Consumers rely heavily on the integrity and due diligence of those serving as representatives throughout this process to secure their investments.  When the integrity of this process is compromised, illegally, public confidence is eroded.  We must work to assure the public that their investments are sound, worthy, and protected.”

Special Agent in Charge Steinbach stated, “Our country is increasingly faced with more pervasive and sophisticated fraud schemes that have the potential to disrupt entire markets and the economy as a whole.  The FBI, with our partners, is committed to addressing these schemes.  As these schemes continue to evolve and become more sophisticated, so too will we.”

Brown was the chief executive of DocX LLC, which was involved in the preparation and recordation of mortgage-related documents throughout the country since the 1990s.  DocX was acquired by an LPS predecessor company, and was part of LPS’s business when LPS was formed as a stand-alone company in 2008.  At that time, DocX was rebranded as “LPS Document Solutions, a Division of LPS.”  Brown was the president and senior managing director of LPS Document Solutions, which constituted DocX’s operations.

DocX’s main clients were residential mortgage servicers, which typically undertake certain actions for the owners of mortgage-backed promissory notes.  Servicers hired DocX to, among other things, assist in creating and executing mortgage-related documents filed with recorders’ offices.  Only specific personnel at DocX were authorized by the clients to sign the documents.

According to plea documents filed today, employees of DocX, at the direction of Brown and others, began forging and falsifying signatures on the mortgage-related documents that they had been hired to prepare and file with property recorders’ offices.  Unbeknownst to the clients, Brown directed the authorized signers to allow other DocX employees, who were not authorized signers, to sign the mortgage-related documents and have them notarized as if actually executed by the authorized DocX employee.

Also according to plea documents, Brown implemented these signing practices at DocX to enable DocX and Brown to generate greater profit.  Specifically, DocX was able to create, execute and file larger volumes of documents using these signing and notarization practices.  To further increase profits, DocX also hired temporary workers to sign as authorized signers.  These temporary employees worked for much lower costs and without the quality control represented by Brown to DocX’s clients.  Some of these temporary workers were able to sign thousands of mortgage-related instruments a day.  Between 2003 and 2009, DocX generated approximately $60 million in gross revenue.

After these documents were falsely signed and fraudulently notarized, Brown authorized DocX employees to file and record them with local county property records offices across the country.  Many of these documents – particularly mortgage assignments, lost note affidavits and lost assignment affidavits – were later relied upon in court proceedings, including property foreclosures and federal bankruptcy actions.  Brown admitted she understood that property recorders, courts, title insurers and homeowners relied upon the documents as genuine.

Brown also admitted that she and others also took various steps to conceal their actions from clients, LPS corporate headquarters, law enforcement authorities and others.  These actions included testing new employees to ensure they could mimic signatures, lying to LPS internal audit personnel during reviews of the operation in 2009, making false exculpatory statements after being confronted by LPS corporate officials about the acts and lying to the FBI during its investigation.  LPS closed DocX in early 2010.

This case is being prosecuted by Trial Attorney Ryan Rohlfsen and Assistant Chief Glenn S. Leon of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Mark B. Devereaux of the U.S. Attorney’s Office for the Middle District of Florida.  This case is being investigated by the FBI, with assistance from the state of Florida’s Department of Financial Services.

Today’s conviction is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants, including more than 2,700 mortgage fraud defendants. For more information on the task force, visit

Detroit-Area Nurse Sentenced to 30 Months in Prison for Role in $13.8 Million Home Health Care Fraud Scheme (CRM-FRD and USAO-EDMI)

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Monday, November 19, 2012
Detroit-Area Nurse Sentenced to 30 Months in Prison for Role in $13.8 Million Home Health Care Fraud Scheme

WASHINGTON—A Detroit-area registered nurse was sentenced today to serve 30 months in prison for his role in a nearly $13.8 million Medicare fraud scheme, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney for the Eastern District of Michigan Barbara L. McQuade; Special Agent in Charge Robert D. Foley III of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) Chicago Regional Office.

Anthony Parkman, 41, of Southfield, Mich., was sentenced today by U.S. District Judge Gerald E. Rosen in the Eastern District of Michigan. In addition to his prison term, Parkman was sentenced to three years of supervised release and was ordered to pay $450,988 in restitution, jointly and severally with his co-defendants.

Parkman pleaded guilty on June 26, 2012, to one count of conspiracy to commit health care fraud.

According to Parkman’s plea agreement, beginning in approximately December 2008, Parkman, a registered nurse, was paid to sign medical documentation for Physicians Choice Home Health Care LLC, a home health agency that billed and received payments from Medicare for home health care services that were never rendered.  Parkman admitted to not seeing or treating the beneficiaries for whom he signed medical documentation and admitted he knew that the documents he signed would be used to support false claims to Medicare.  Parkman was paid approximately $150 for each false and fictitious file that he signed.

Parkman was subsequently paid to sign falsified medical documentation and files for First Care Home Health Care LLC, Quantum Home Care Inc. and Moonlite Home Care Inc., which were Detroit-area home health care companies owned by Parkman’s co-conspirators that billed Medicare for services that were never rendered.

The four home health companies for which Parkman worked were paid in total approximately $13.8 million by Medicare.  From approximately December 2008 through September 2011, Medicare paid approximately $450,988 to the four home health care companies for fraudulent skilled nursing claims based on falsified files signed by Parkman.

Nine of Parkman’s co-defendants have pleaded guilty and await sentencing.  Three co-defendants are fugitives, and six co-defendants await trial.

This case was prosecuted by Trial Attorney Catherine K. Dick of the Criminal Division’s Fraud Section.  It was investigated by the FBI and HHS-OIG and 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 Eastern District of Michigan.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion.  In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

Former Executives of Stanford Financial Group Entities Convicted for Roles in Fraud Scheme

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Monday, November 19, 2012
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Monday, November 19, 2012
Former Executives of Stanford Financial Group Entities Convicted for Roles in Fraud Scheme

WASHINGTON – A Houston federal jury has convicted Gilbert T. Lopez Jr., the former chief accounting officer of Stanford Financial Group Company, and Mark J. Kuhrt, the former global controller of Stanford Financial Group Global Management, for their roles in helping Robert Allen Stanford perpetrate a fraud scheme involving Stanford International Bank (SIB).

The guilty verdict was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Kenneth Magidson of the Southern District of Texas; FBI Assistant Director Kevin Perkins of the Criminal Investigative Division; Assistant Secretary of Labor for the Employee Benefits Security Administration Phyllis C. Borzi; Chief Postal Inspector Guy J. Cottrell; and Special Agent in Charge Lucy Cruz of IRS-Criminal Investigation.

Stanford, who was convicted in a separate trial held earlier this year, illegally used billions of dollars of SIB’s assets to fund his personal business ventures, to live a lavish lifestyle, and for other improper purposes.

The evidence presented at the trial of Lopez and Kuhrt established that they were aware of and tracked Stanford’s misuse of SIB’s assets, kept the misuse hidden from the public and from almost all of Stanford’s other employees, and worked behind the scenes to prevent the misuse from being discovered.

The trial against Lopez and Kuhrt spanned five weeks.  After approximately three days of deliberations, the jury found both Lopez, 70, and Kuhrt, 40, both of Houston, guilty of 10 of 11 counts in the indictment.  Each defendant was convicted of one count of conspiracy to commit wire fraud and nine counts of wire fraud.  Each was found not guilty on one wire fraud count.

Both defendants were immediately remanded into custody.

U.S. District Judge David Hittner, who presided over the trial, has set sentencing for Feb. 14, 2013.  At sentencing, Lopez and Kuhrt will each face a maximum of 20 years in prison on each count of conviction.

The investigation was conducted by the FBI, U.S. Postal Inspection Service, IRS-CI and the U.S. Department of Labor, Employee Benefits Security Administration.  The case was prosecuted by Deputy Chief Jeffrey Goldberg and Trial Attorney Andrew Warren of the Criminal Division’s Fraud Section, and by Assistant U.S. Attorney Jason Varnado of the Southern District of Texas.

Scheme

WASHINGTON – A Houston federal jury has convicted Gilbert T. Lopez Jr., the former chief accounting officer of Stanford Financial Group Company, and Mark J. Kuhrt, the former global controller of Stanford Financial Group Global Management, for their roles in helping Robert Allen Stanford perpetrate a fraud scheme involving Stanford International Bank (SIB).

The guilty verdict was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Kenneth Magidson of the Southern District of Texas; FBI Assistant Director Kevin Perkins of the Criminal Investigative Division; Assistant Secretary of Labor for the Employee Benefits Security Administration Phyllis C. Borzi; Chief Postal Inspector Guy J. Cottrell; and Special Agent in Charge Lucy Cruz of IRS-Criminal Investigation.

Stanford, who was convicted in a separate trial held earlier this year, illegally used billions of dollars of SIB’s assets to fund his personal business ventures, to live a lavish lifestyle, and for other improper purposes.

The evidence presented at the trial of Lopez and Kuhrt established that they were aware of and tracked Stanford’s misuse of SIB’s assets, kept the misuse hidden from the public and from almost all of Stanford’s other employees, and worked behind the scenes to prevent the misuse from being discovered.

The trial against Lopez and Kuhrt spanned five weeks.  After approximately three days of deliberations, the jury found both Lopez, 70, and Kuhrt, 40, both of Houston, guilty of 10 of 11 counts in the indictment.  Each defendant was convicted of one count of conspiracy to commit wire fraud and nine counts of wire fraud.  Each was found not guilty on one wire fraud count.

Both defendants were immediately remanded into custody.

U.S. District Judge David Hittner, who presided over the trial, has set sentencing for Feb. 14, 2013.  At sentencing, Lopez and Kuhrt will each face a maximum of 20 years in prison on each count of conviction.

The investigation was conducted by the FBI, U.S. Postal Inspection Service, IRS-CI and the U.S. Department of Labor, Employee Benefits Security Administration.  The case was prosecuted by Deputy Chief Jeffrey Goldberg and Trial Attorney Andrew Warren of the Criminal Division’s Fraud Section, and by Assistant U.S. Attorney Jason Varnado of the Southern District of Texas.

Program Director and Therapist from Miami-Area Mental Health Care Corporation Convicted for Participating in $205 Million Medicare Fraud Scheme

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 11/16/2012

WASHINGTON – A federal jury yesterday convicted a Miami-area program director and a Miami-area therapist for their participation in a Medicare fraud scheme involving more than $205 million in fraudulent billings by mental health care corporation American Therapeutic Corporation (ATC), announced Assistant Attorney General Lanny A. Breuer of the Justice Department=s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Acting Special Agent in Charge of the FBI=s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.

Program director Lydia Ward, 47, and therapist Nichole Eckert, 35, were each found guilty of one count of conspiracy to commit health care fraud.

The defendants were charged in an indictment returned on Feb. 8, 2011. ATC, the management company associated with ATC and 20 individuals, including the ATC owners, have all previously pleaded guilty or have been convicted at trial.

Evidence at trial demonstrated that the defendants and their co-conspirators caused the submission of false and fraudulent claims to Medicare through ATC, a Florida corporation headquartered in Miami that operated purported partial hospitalization programs (PHPs) in seven different locations throughout South Florida and Orlando. A PHP is a form of intensive treatment for severe mental illness. The defendants and their co-conspirators also used a related company, American Sleep Institute (ASI), to submit fraudulent Medicare claims.

ATC billed Medicare for hundreds of millions of dollars in false and fictitious services, for thousands of patients who were not qualified, based on fraudulent documents created by Ward, Eckert and others.

Throughout the course of the fraud conspiracy, tens of millions of dollars in kickbacks were paid in exchange for Medicare beneficiaries, who did not qualify for PHP services, to attend treatment programs that were not legitimate PHP programs. ATC and ASI billed Medicare for more than $205 million in services to patients who did not need the services and to whom the appropriate services were not provided. According to the evidence, Ward, Eckert, and co-conspirators personally altered and caused the alteration of patient files and therapist notes for the purpose of making it appear, falsely, that patients being treated by ATC were qualified for PHP treatments and that the treatments provided were legitimate PHP treatments.

Evidence further revealed that doctors at ATC signed patient files without reading them or seeing the patients. Included in these false and fraudulent submissions to Medicare were claims for patients in neuro-vegetative states, along with patients who were in the late stages of diseases causing permanent cognitive memory loss and patients who were suffering from substance abuse addiction without a severe mental illness – all of whom were ineligible for PHP treatment.

Ward and Eckert were remanded into custody.

ATC executives Lawrence Duran, Marianella Valera, Judith Negron and Margarita Acevado were sentenced to 50 years, 35 years, 35 years and 91 months in prison, respectively, for their roles in the fraud scheme. Sentencing for Ward and Eckert is scheduled for Jan. 25, 2013. The maximum penalty for each conspiracy count is 10 years in prison.

A mistrial was declared today against ATC patient marketer Hilario Morris, who was charged with one count of conspiracy to commit health care fraud. Previously, Morris had been convicted of one count of conspiracy to pay health care kickbacks.

The criminal case is being prosecuted by Trial Attorneys Jennifer L. Saulino and Laura Cordova of the Criminal Division’s Fraud Section. A related civil action is being handled by Vanessa I. Reed and Carolyn B. Tapie of the Civil Division and Assistant U.S. Attorney Ted L. Radway of the Southern District of Florida. The case was investigated by the FBI and HHS-OIG, and 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.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov.

Two Patient Recruiters Sentenced in Miami for Roles in $50 Million Medicare Fraud Scheme (USAO-SDFL)

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Friday, November 16, 2012
11/16/2012: Two Patient Recruiters Sentenced in Miami for Roles in $50 Million Medicare Fraud Scheme (USAO-SDFL)

WASHINGTON – Two former patient recruiters for Miami-based mental health clinic Biscayne Milieu Health Care Inc. were sentenced today for their participation in a Medicare fraud scheme involving the submission of more than $50 million in fraudulent billings to Medicare, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, Acting Special Agent in Charge of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG), Office of Investigations Miami Office.

Anthony Roberts, 45, and Derek Alexander, 39, both of Miami, were each sentenced today by U.S. District Judge Robert N. Scola Jr. in the Southern District of Florida.  Roberts was sentenced to serve 87 months in prison and ordered to pay $887,085 in restitution.  Alexander was sentenced to serve 42 months in prison and ordered to pay $300,876 in restitution.

Roberts and Alexander were each convicted of one count of conspiracy to commit a health care kickback scheme and a substantive kickback charge on Aug. 24, 2012, after a two-month trial.

Various owners, doctors, managers, therapists, patient brokers and other employees of Biscayne Milieu were charged with various health care fraud, kickback, money laundering and other offenses in two indictments unsealed in September 2011 and June 2012.  Biscayne Milieu, its owners and more than 25 of the individual defendants charged in these cases have pleaded guilty or have been convicted at trial.  Antonio and Jorge Macli, and Sandra Huarte, the owners and operators of Biscayne Milieu, and Dr. Gary Kushner, its medical director, were each convicted of various offenses at trial and will be sentenced on Dec. 20, 2012.

Evidence at trial demonstrated that the defendants and their co-conspirators caused the submission of millions of dollars in false and fraudulent claims to Medicare through Biscayne Milieu, a Florida corporation headquartered in Miami that operated a purported partial hospitalization program (PHP) in Miami.  A PHP is a form of intensive treatment for severe mental illness.  Biscayne Milieu purported to provide PHP services for Medicare beneficiaries suffering from mental illnesses. In fact, however, the co-conspirators devised a scheme in which they paid patient recruiters, such as Roberts and Alexander, to refer ineligible Medicare beneficiaries to Biscayne Milieu for purported PHP services that were never provided. Many of the patients admitted to Biscayne Milieu were not eligible for PHP because they were chronic substance abusers, suffered from severe dementia or Alzheimer’s disease and would not benefit from group therapy, or had no mental health diagnosis at all but were seeking fraudulent mental health treatment in order to be declared exempt from certain requirements for their applications for United States citizenship.  The evidence at trial showed that Alexander and Roberts solicited and received illegal kickbacks in exchange for sending ineligible patients to Biscayne Milieu.

The criminal case was prosecuted by Assistant U.S. Attorneys Michael Davis and Marlene Rodriguez of the Southern District of Florida, and by Trial Attorney James V. Hayes of the Criminal Division’s Fraud Section.  The investigation was led by the FBI with the assistance of HHS-OIG, and was brought by the U.S. Attorney’s Office for the Southern District of Florida in coordination with the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

Detroit-area Physician Sentenced to 60 Months for Health Care Fraud (USAO-EDMI)

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11/6/2012

Jonathan Agbebiyi, 63, of Sterling Heights, Michigan, was sentenced yesterday for his role in a $5.4 million Medicare fraud scheme, announced United States Attorney Barbara L. McQuade. McQuade was joined in the announcement by Assistant Attorney General Lanny A Breuer of the Criminal Division in Washington, DC, Special Agent-In-Charge, Robert Foley, III, Federal Bureau of Investigation and Special Agent in Charge Lamont Pugh III of the Health and Human Services – Office of Inspector General’s (OIG) Chicago Regional Office.

Agbebiyi was sentenced by United States District Judge Arthur J. Tarnow to 60 months in prison, followed by 2 years supervised release, and ordered to pay $2,982,029.19 in restitution.

In May, 2012, Jonathan Agbebiyi, 63, of Sterling Heights, Michigan, was convicted of one count of conspiracy to commit health care fraud, and six counts of health care fraud. Agbebiyi was a staff physician at three clinics which operated in Livonia, Michigan, between 2007 and 2010: Blessed Medical Clinic, Alpha and Omega Medical Clinic, and Manuel Medical Clinic.

According to the evidence presented during the one week trial, Jonathan Agbebiyi, an obstetrician/gynecologist, joined a conspiracy to bill Medicare for medically unnecessary neurological tests. Some of the tests involved sending an electrical current through the arms and legs of the patients. Clinic employees, who lacked any meaningful training, administered the diagnostic tests. The patients never received any follow up treatment by neurologists.
Evidence at trial showed that the patients were not referred to the clinics by their primary care physicians, or for any other legitimate purpose, but rather were recruited with prescriptions for controlled substances, cash payments, and fast food. The three clinics then billed the Medicare program for various diagnostic tests that were medically unnecessary.

United States Attorney Barbara L. McQuade stated, “This doctor exposed patients to electrical currents for neurological testing solely to generate money for himself at the expense of the Medicare program. We hope that cases like this one will deter other doctors from using patients as commodities for personal gain.”

This case was prosecuted by Assistant U.S. Attorneys Frances Lee Carlson and Philip A. Ross of the Eastern District of Michigan, with assistance from Assistant Chief Gejaa T. Gobena of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG, and 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 Eastern District of Michigan.

The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention & Enforcement Action Team (HEAT), a joint initiative announced in May 2009 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.
Since their inception in March 2007, strike force operations in nine locations have charged more than 1,330 defendants who collectively have falsely billed the Medicare program for more than $4 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

California Man Sentenced to 15 Months in Prison For Conspiracy to Defraud USAID of $386,279 – Admitted Scheme to Embezzle Agency Funds Meant for Global Health

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Tuesday, November 6, 2012 Public Affairs
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WASHINGTON – Everett Lipscomb Jr., 42, of Aliso Viejo, Calif., has been sentenced
to 15 months in prison on a charge stemming from his role in a conspiracy to embezzle more than $386,000 from a federal program meant to address global health problems.
The sentence was announced by Ronald C. Machen Jr., U.S. Attorney for the District of
Columbia, and Michael G. Carroll, Deputy Inspector General for the U.S. Agency for
International Development (USAID).
Lipscomb pled guilty in March 2012 to one count of conspiracy to commit wire and mail
fraud, a federal felony. He was sentenced on Nov. 5, 2012 by the Honorable Beryl A. Howell in the U.S. District Court for the District of Columbia. As part of his sentence, Lipscomb was ordered to pay full restitution of $386,279 to USAID. Lipscomb also consented to an order forfeiting any property he owned up to that amount. As indicated in court filings, the government has already seized about $49,000 in proceeds from the scheme from other coconspirators. Upon completion of his prison term, Lipscomb will be placed on two years of supervised release.
As part of his plea, Lipscomb admitted that he conspired together with Mark Adams, a
former deputy director at a private contractor that did business with USAID, and Adams’s wife, Latasha Bell. Lipscomb admitted that Adams used his position at the contracting company to submit and approve false and fraudulent invoices and thereby obtain money.
In Lipscomb’s case, the bogus invoices claimed amounts due for services from Octopus
Limited Audio and Visual, a company controlled by Lipscomb. However, neither Lipscomb nor Octopus – or anyone else – performed the work and services claimed on the invoices. Lipscomb admitted that between April 2008 and August 2010, he received payments from the USAID contracting company totaling $386,279. Of that amount, Lipscomb kept $157,372 for himself and passed the remainder, $228,907, back to Adams and Bell.
Lipscomb further admitted that the fraudulent bills were paid with money that should
have been used for USAID’s global health program. The program addresses major global issues, including HIV/AIDS. At sentencing, Judge Howell noted that the company that employed Adams was seriously impacted by the crime. The company lost its contract with USAID and several employees lost their jobs as a result.
Adams, 44, and Bell, 36, of Fort Washington, Md., pled guilty last month to their roles in
the conspiracy. Adams admitted that the scheme involved more than $1.084 million in
fraudulent payments through such fake invoices between 2006 and 2010. Adams and Bell used the payments to complete an extensive renovation of their home and to buy luxury automobiles.
Adams and Bell are scheduled to be sentenced on Dec. 14, 2012, also before Judge
Howell. Under federal sentencing guidelines, Adams faces a sentence of up to 51 to 63 months of incarceration. Under the plea agreement, Bell agreed to a sentence of home confinement.
In announcing the sentence, U.S. Attorney Machen and Deputy Inspector General Carroll
commended the work of the special agents from the USAID Office of Inspector General, which investigated the case. They also thanked those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Krishawn Graham and Nicole Wattelet, Forensic Accountant Crystal Boodoo, Assistant U.S. Attorney Anthony Saler, who handled forfeiture issues, and Assistant U.S. Attorney Jonathan Hooks, who is prosecuting the case.

Former Employee of Army Contractor Pleads Guilty to Bribery

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Wednesday, October 24, 2012
Former Employee of Army Contractor Pleads Guilty to Bribery for Facilitating Theft by Trucking Contractor in Afghanistan

WASHINGTON – A Houston woman pleaded guilty today to bribery charges for her role in a scheme to fraudulently bill the U.S. Army for trucking services in Afghanistan, announced Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division.

Diyana Montes, 29, pleaded guilty before U.S. District Judge James E. Boasberg in the District of Columbia to one count of bribery.

According to court documents, from approximately April 2008 through December 2008, Montes was an employee of Kellogg, Brown and Root (KBR), a private contractor with operations in Afghanistan. Montes worked at Bagram Airfield, Afghanistan, where KBR held a contract with the United States.

KBR’s contract involved providing services to the Army’s Movement Control Branch (MCB). The MCB’s mission was to contract with local Afghan trucking companies to transport U.S. military equipment, fuel and other supplies throughout Afghanistan. As part of this mission, the MCB coordinated requests from various U.S. military units for trucking services and assigned those requests to particular contractors. Each trucking request generated various specific documents, including “transportation movement requests” (TMR), which authorized the use of trucks.

According to court documents, Montes’s duties included receiving TMRs from various contractors and reconciling any discrepancies between the amount of services described in the TMRs and the amount of services the contractors claimed in their invoices. Once Montes reviewed the documents and determined they were accurate, she would pass them on to other contracting personnel, who would rely on her review in approving payments to the trucking company.

On numerous occasions, according to court documents, Montes received and reviewed TMRs and invoices for services allegedly provided by Afghanistan Trade Transportation (ATT), a trucking company contracted by the U.S. Army, that fraudulently represented that ATT provided services that Montes knew were not in fact performed. According to Montes’s plea agreement, she knew the invoices from ATT contained service claims that were not accurate, and she passed them along for payment with the knowledge that the billings were fraudulent.

According to her plea agreement, from approximately May 2008 through December 2008, in return for her knowingly handling the fraudulent TMRs and invoices, Montes received from ATT approximately $50,000, consisting of $35,000 wired to her personal bank account in the United States and another $15,000 in cash paid to her on several occasions in Afghanistan.

This case is being prosecuted by Special Trial Attorney Mark H. Dubester of the Criminal Division’s Fraud Section and former Fraud Section Trial Attorney Mark Pletcher, currently of the U.S. Attorney’s Office for the Southern District of California. The case was investigated by the Special Inspector General for Afghanistan Reconstruction, the Defense Criminal Investigative Service, the U.S. Army Criminal Investigation Division and the FBI.

Army Sergeant Pleads Guilty to Facilitating Theft of Fuel in Afghanistan

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Wednesday, October 10, 2012
Army Sergeant Pleads Guilty to Facilitating Theft of Fuel in Afghanistan
Second Guilty Plea Stemming from an Investigation of Fuel Theft at FOB Fenty in Afghanistan

WASHINGTON – U.S. Army Sergeant Christopher Weaver pleaded guilty today to bribery charges for his role in the theft of fuel at Forward Operating Base (FOB) Fenty, near Jalalabad, Afghanistan, announced Assistant Attorney General for the Justice Department’s Criminal Division Lanny A. Breuer.

Weaver, 29, of Fort Carson, Colo., pleaded guilty before U.S. District Judge Marcia S. Krieger in the District of Colorado to one count of conspiracy to commit bribery and one count of bribery.

Weaver’s plea is the second guilty plea arising from an investigation into fuel thefts at FOB Fenty.  On Aug. 3, 2012, Weaver’s co-conspirator Jonathan Hightower, 30, of Houston, pleaded guilty for his role in the scheme.

According to court documents, from approximately January 2010 through June 2010, Weaver and Hightower were involved in overseeing the delivery of fuel from FOB Fenty to other military bases.  As part of this process, documents generally described as “transportation movement requests” (TMRs) were created, which authorized the movement of the fuel.  Weaver pleaded guilty to participating in a conspiracy in which fraudulent TMRs, which purported to authorize the transport of fuel from FOB Fenty to other military bases, were created even though no legitimate fuel transportation was required.  After the trucks were filled with fuel, these fraudulent documents were used by the drivers of the fuel trucks at FOB Fenty’s departure checkpoint in order to justify the trucks’ departures from FOB Fenty.  In truth, according to court documents, the fuel was simply stolen.

Weaver pleaded guilty to receiving payments from a representative of a military contractor that was responsible for transporting fuel in Afghanistan in exchange for facilitating the theft of approximately 100 fuel trucks.  According to Weaver’s signed plea agreement, the loss to the United States as a result of the scheme was in excess of $1.5 million.  According to court documents, Weaver sent cash back from Afghanistan to the United States, in part, by mailing the money inside a stuffed bear.

According to court documents, Hightower worked in Afghanistan as an employee of FLUOR Inc., a U.S. government contractor, from January 2010 to June 2010, where he served as a petroleum supply specialist and was responsible for receiving and disbursing fuel – primarily jet fuel known as JP-8 – for use at FOB Fenty or for transport to other military bases.  According to court documents, Hightower, Weaver and others would receive cash from a representative of a military contractor that was responsible for transporting fuel in Afghanistan, and the money would be apportioned among the conspirators.

Hightower pleaded guilty before U.S. District Judge William J. Martinez in the District of Colorado to two counts of conspiracy to receive bribes – one count involving his conspiracy with Weaver, and another count involving his conspiracy with another alleged co-conspirator at FOB Fenty.  Hightower admitted facilitating the theft of over 100 trucks of fuel and a loss to the United States in excess of $1.5 million.

The cases are being prosecuted by Assistant U.S. Attorney Mark W. Pletcher of the U.S. Attorney’s Office for the Southern District of California, formerly of the Criminal Division’s Fraud Section, and Special Trial Attorney Mark H. Dubester of the Fraud Section.  The cases were investigated by the Special Inspector General for Afghanistan Reconstruction; the Department of the Army, Criminal Investigations Division; the Defense Criminal Investigative Service; the FBI; and the Department of the Air Force, Office of Special Investigations.  Valuable assistance was also provided by the Justice Department’s Office of International Affairs.