Tag Archives: Dennis Rosen

Owner of Two New York Medical Clinics Sentenced to 84 Months for Her Role in $55 Million Health Care Fraud Scheme

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Friday, September 15, 2017

The owner of two Brooklyn, New York, medical clinics was sentenced today to 84 months in prison for her role in a $55 million health care fraud scheme.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney Bridget M. Rohde of the Eastern District of New York, Special Agent in Charge Scott Lampert of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS OIG) Office of Investigations, Special Agent in Charge James D. Robnett of the IRS Criminal Investigation’s (IRS-CI) New York Field Office and Inspector General Dennis Rosen of the New York State Office of the Medicaid Inspector General (OMIG) made the announcement.

Valentina Kovalienko, 47, of Brooklyn, and the owner of Prime Care on the Bay LLC and Bensonhurst Mega Medical Care P.C., was sentenced by U.S. District Judge Roslynn R. Mauskopf of the Eastern District of New York, who also ordered Kovalienko to forfeit $29,336,497. Kovalienko pleaded guilty in October 2015 to one count of conspiracy to commit health care fraud and one count of conspiracy to commit money laundering.

As part of her guilty plea, Kovalienko acknowledged that her co-conspirators paid cash kickbacks to patients to induce them to attend her two clinics.  Kovalienko also admitted that she submitted false and fraudulent claims to Medicare and Medicaid for services that were induced by prohibited kickback payments to patients or that were unlawfully rendered by unlicensed staff.  Kovalienko also wrote checks from the clinics’ bank accounts to third-party companies, which purported to provide services to the clinics, but which in fact were not providing services, and the payments were instead used to generate the cash needed to pay the illegal kickbacks to patients, she admitted.

Twenty other individuals have pleaded guilty in connection with this case, including the former medical directors of Prime Care on the Bay LLC and Bensonhurst Mega Medical Care P.C., six physical and occupational therapists, three ambulette drivers, the owner of several of the sham companies used to launder the money and a former patient who received illegal kickbacks.

HHS-OIG, IRS-CI and OMIG investigated the case, which was brought as part of the Medicare Fraud Strike Force, under the supervision by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York.  Acting Assistant Chief A. Brendan Stewart of the Fraud Section and Assistant U.S. Attorney F. Turner Buford of the Eastern District of New York, formerly a Fraud Section trial attorney, are prosecuting the case.

The Criminal Division’s 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 3,500 defendants who have collectively billed the Medicare program for more than $12.5 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.

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

A.G. Schneiderman Announces Civil Suit And Criminal Charges Against Pharmacy Owner For Allegedly Defrauding Medicaid Of Millions

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Hin T. Wong Allegedly Paid Patients Kickbacks And Billed Medicaid For HIV Medications Never Dispensed

Defendant Allegedly Used Money Stolen From Medicaid To Fund Personal Expenses, Including Travel And Furniture 

NEW YORK – Attorney General Eric T. Schneiderman today announced a lawsuit and criminal charges against pharmacist Hin T. Wong, 49, of Manhattan, and NY Pharmacy, Inc. (“NY Pharmacy”) for allegedly defrauding the New York State Medicaid program out of millions of dollars. Wong, a licensed pharmacist and owner of NY Pharmacy, located at 131 Walker Street in Manhattan, allegedly paid undercover agents posing as Medicaid recipients kickbacks for HIV prescriptions and for referring other Medicaid recipients to bring their prescriptions to NY Pharmacy. Wong and NY Pharmacy also allegedly billed and were eventually paid over $60,0000 by Medicaid for refills on prescriptions submitted by undercover agents that NY Pharmacy either did not dispense or were predicated on the payment of a kickback.   Various state laws and Medicaid regulations prohibit the payment of kickbacks for the referral of patients or individual prescriptions. In addition, the  Attorney General also announced the filing of a civil asset forfeiture action seeking over $11 million in damages from Wong, NY Pharmacy and two other pharmacies owned by Wong that are now closed.

“Stealing from Medicaid in order to purchase fancy accessories and travel tickets is absolutely shameful,” said Attorney General Schneiderman. “We will not allow Medicaid to serve as a personal piggy bank for criminals. Fraudsters who seek to rip-off this vital program that helps millions of New Yorkers will be held accountable.”

The on-going investigation into NY Pharmacy being conducted by the Attorney General’s Medicaid Fraud Control Unit (“MFCU”) revealed that on multiple occasions between July 2014 and August 2017, Wong allegedly paid kickbacks to undercover MFCU agents posing as patients to fill prescriptions, most of which involved medication to treat HIV, at NY Pharmacy or at two other pharmacies she owned, which are now closed.  The defendants thereafter allegedly submitted claims for reimbursement to Medicaid through NY Pharmacy for refills that were not dispensed by the pharmacy, a scheme known as “auto-refilling.”

Simultaneous to today’s arrest, the Attorney General filed a civil asset forfeiture action against Wong, NY Pharmacy, and Wong’s two closed pharmacies in New York State Supreme Court, New York County seeking over $11 million in damages.  In papers filed in court today, the Attorney General alleges that Wong personally made millions from the scheme and used the proceeds, among other things, to make lavish credit card purchases of high-end retail items (including Prada and Vuitton), and to pay for travel expenses and expensive furniture. An investigational audit uncovered evidence indicating that Wong’s pharmacies did not purchase enough medication to support their substantial billings to Medicaid. Between January 1, 2014 and August 1, 2017, Wong’s pharmacies billed Medicaid and other insurers over $15 million for medications, but allegedly purchased only a fraction of the amount of drugs necessary to fill those prescriptions. As part of the civil action, the Attorney General also obtained a court order freezing the bank accounts held by the defendants to preserve money wrongfully obtained from Medicaid.

Investigators from the Attorney General’s Office with the assistance of investigators from the New York State Office of the Medicaid Inspector General executed a search warrant this morning at NY Pharmacy. Hin T. Wong and NY Pharmacy were arrested and charged by felony complaint filed in New York City Criminal Court, New York County with Grand Larceny in the Third Degree, a class D felony, and Medical Assistance Provider: Prohibited Practices (Kickbacks), a class E felony. Wong is expected to be arraigned later this afternoon. If convicted on the top count, Wong faces up to seven years in state prison. Wong may face additional criminal charges as the criminal investigation continues.

The Attorney General thanks the New York State Office of the Medicaid Inspector General under the leadership of Inspector General Dennis Rosen for its continued partnership and its assistance in this investigation.  The Attorney General also thanks Medicaid managed care insurers Amida Care and Metro Plus for referring the matter and for their cooperation throughout the investigation.

The charges against the defendants are merely accusations. The defendants are presumed innocent unless and until proven guilty in a court of law.

MFCU’s investigation was conducted by Investigator Nefertiti Clarke with the assistance of Supervising Investigator Dominick DiGennaro and Deputy Chief Investigator Kenneth Morgan. The audit investigation was conducted by Principal Auditor Investigator Cristina Marin and Auditor Investigator Megan Scott with the assistance of New York City Regional Deputy Chief Auditor Jonathan Romano and New York City Regional Chief Auditor Thomasina Smith.

The criminal case is being prosecuted by Special Counsel Imran S. Ahmed with the assistance of MFCU New York City Deputy Regional Director Twan Bounds and MFCU New York City Regional Director Christopher M. Shaw. The civil action is being brought by Senior Counsel Marie Spencer and Special Assistant Attorney General Elizabeth Kappakas with the assistance of MFCU Chief of Civil Enforcement Carolyn Ellis.  Special Assistant Attorney General Thomas O’Hanlon is the MFCU Chief of Criminal Investigations-Downstate. MFCU is led by Director Amy Held and Assistant Deputy Attorney General Paul J. Mahoney.

Brooklyn Pharmacy Owner/Operator Charged With Defrauding Medicare And Medicaid Programs Of Approximately $9 Million

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Monday, July 10, 2017

Joon H. Kim, the Acting United States Attorney for the Southern District of New York, William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Office of the New York Office of the Federal Bureau of Investigation (“FBI”), Scott J. Lampert, Special Agent in Charge of the New York Regional Office for the Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), and Dennis Rosen, Inspector General of the New York State Office of the Medicaid Inspector General (“OMIG”), announced today the unsealing of a criminal Complaint charging defendant SUNITA KUMAR with operating a health care fraud scheme utilizing two pharmacies in Brooklyn, New York, through which KUMAR submitted approximately $9 million in fraudulent claims to Medicaid and Medicare. KUMAR was arrested this morning and was presented in Manhattan federal court today before U.S. Magistrate Judge Andrew J. Peck.

Manhattan Acting U.S. Attorney Joon H. Kim said: “As alleged, Sunita Kumar defrauded Medicare and Medicaid, public programs to assist the indigent and the elderly, by submitting $9 million in fraudulent claims. She allegedly did so by inducing people to surrender their own prescriptions and forego their medications in exchange for kickbacks. Medicare and Medicaid provide critical health care for some of our most vulnerable citizens. Together with our law enforcement partners, we will aggressively pursue those who allegedly use public programs as a vehicle for illegal personal profit.”

FBI Assistant Director William F. Sweeney Jr. said: “Exploiting our federal and state health care programs places the economy at a significant disadvantage and threatens the stability of the health care industry overall. Because there’s no single, clearly identifiable victim, the public often finds these schemes incomparable to other, more explicit frauds. But everyone deserves to know that health care fraud alone costs this country tens of billions of dollars a year, not to mention the obvious health safety risks it presents. We will continue to confront this type of crime, and root it out, until it no longer exists.”

HHS-OIG Special Agent-in-Charge Scott J. Lampert said: “Prescription drug scams, such as the one alleged in this case, work to undermine our nation’s health care system. Today’s arrest coordinated with our law enforcement partners serve as a stern warning to pharmacy owners tempted to plunder government health programs meant to care for our most vulnerable citizens.”

Medicaid Inspector General Dennis Rosen said: “Exploiting the Medicaid program for personal gain by preying upon New York’s most-vulnerable populations is reprehensible. We will continue to work closely with our federal, state and local partners to hold wrongdoers fully accountable and protect the integrity of the Medicaid program.”

According to the allegations contained in the Complaint[1]:

KUMAR – while owning one pharmacy herself and operating a second pharmacy, both located in Brooklyn, New York – conducted a multimillion-dollar scheme to defraud Medicare and Medicaid programs by fraudulently seeking reimbursements for prescription drugs. Specifically, KUMAR engaged in a scheme to obtain prescriptions for medications, for which her pharmacies billed and received reimbursement from Medicare and Medicaid, but which she did not actually dispense to customers. From in or about January 2015 through in or about December 2016, KUMAR obtained approximately $9 million in reimbursements from Medicare and Medicaid for prescription drugs that her pharmacies never actually dispensed. KUMAR defrauded Medicare and Medicaid into providing her pharmacies with these reimbursements by obtaining prescriptions from other individuals, who were willing to forego delivery of the medications in exchange for a share of the reimbursed proceeds, in the form of kickbacks paid by KUMAR.

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KUMAR, 54, of Old Westbury, New York, is charged with one count of health care fraud, which carries a maximum sentence of 10 years in prison, and one count of paying illegal remuneration in the form of kickbacks, which carries a maximum sentence of five years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Kim praised the investigative work of the FBI, HHS-OIG, and OMIG.

The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorneys Christopher J. DiMase and Sarah E. Paul are in charge of the prosecution.

The charges contained in the Complaint 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 Complaint, and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.