Tag Archives: False Claims

Patient Recruiter of Miami Home Health Company Sentenced to 37 Months in Prison for Role in $20 Million Health Care Fraud Scheme

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A patient recruiter for a Miami health care company was sentenced today to serve 37 months in prison for his participation in a $20 million Medicare fraud scheme, announced Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Michael B. Steinbach, 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.

Manuel Lozano, 65, was sentenced by U.S. District Judge Joan A. Lenard in the Southern District of Florida.  In addition to his prison term, Lozano was sentenced to serve two years of supervised release and ordered to pay $1,851,000 in restitution, jointly and severally with co-conspirators.

In February 2013, Lozano pleaded guilty to one count of conspiracy to receive health care kickbacks.

According to court documents, Lozano was a patient recruiter who worked for Serendipity Home Health, a Miami home health care agency that purported to provide home health and therapy services to Medicare beneficiaries.

According to court documents, from approximately April 2007 through March 2009, Lozano recruited patients for Serendipity, and in doing so he solicited and received kickbacks and bribes from the owners and operators of Serendipity in return for allowing the company to bill the Medicare program on behalf of the patients he recruited.  These Medicare beneficiaries were billed for home health care and therapy services that were medically unnecessary and/or not provided.

From approximately January 2006 through March 2009, Serendipity submitted approximately $20 million in claims for home health services that were not medically necessary and/or not provided, and Medicare paid approximately $14 million for these fraudulent claims. As a result of Lozano’s participation in the illegal scheme, the Medicare program was fraudulently billed more than $1 million but less than $2.5 million for purported home health care services.

In a related case, on June 21, 2012, Ariel Rodriguez and Reynaldo Navarro, the owners and operators of Serendipity, were sentenced to 73 and 74 months in prison, respectively, and ordered to pay $14 million in restitution and severally with each other and their co-defendants, Melissa Rodriguez and Ysel Salado. Ariel and Melissa Rodriguez, Navarro and Salada each pleaded guilty in March 2012 to one count conspiracy to commit health care fraud.

This case is being prosecuted by Assistant Chief Joseph S. Beemsterboer 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 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.

CIA Contractors Settle False Claims Act and Kickback Allegations for $3 Million United States Alleges Companies Provided Government Employees with Meals and Entertainment to Steer Contract Award

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The Justice Department announced today that American Systems Corporation,  International Inc., and Corning Cable Systems LLC have agreed to pay the United States $3 million to settle allegations that they violated the False Claims Act and the Anti-Kickback Act in bidding on a contract with the CIA.

The settlement announced today resolves claims against these contractors related to a CIA contract awarded to American Systems in early 2009 to provide supplies and services.  American Systems teamed with Anixter to bid on the contract with Corning as a supplier.   The United States alleged that American Systems, Anixter and Corning provided gratuities, including meals, entertainment, gifts and tickets to sporting and other events, to CIA employees and outside consultants in order to influence contract specifications that would favor the three companies in the award of the contract. The settlement also resolves allegations that the three companies improperly received source selection information from a CIA employee to whom they had provided gratuities, and that they had concealed the gratuities prior to award.

“This settlement shows that the United States will protect the integrity of the federal procurement process from the wrongful activities of unscrupulous contractors,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Department of Justice, Civil Division.   “Plying government officials with meals and entertainment to gain favorable treatment in the award of federal contracts corrupts the procurement process and will not be allowed.”  

 “Improper gifts and gratuities paid to government officials are a corrupting influence on government contracts. Combating this type of conduct is a high priority in the Eastern District of Virginia,” said U.S. Attorney for the Eastern District of Virginia Neil MacBride.

“This case clearly reflects that the CIA will respond effectively to allegations of fraud affecting agency programs,” said CIA Inspector General David B. Buckley. “My office treats contract fraud and related employee misconduct as one of our top investigative priorities, and we work closely with agency employees and the Department of Justice to ensure that illegal acts are addressed in an effective manner.”

The allegations resolved by the settlement were initiated by a lawsuit filed in the Eastern District of Virginia under the qui tam, or whistleblower, provisions of the False Claims Act by former Anixter sales representative, William Jones. Under the False Claims Act, private citizens may sue on behalf of the United States for false claims and share in any recovery obtained by the government. Jones will receive $585,000 as his share of the government’s recovery.

This settlement was the result of a coordinated effort by the United States Attorney’s Office for the Eastern District of Virginia; the Department of Justice, Civil Division, Commercial Litigation Branch; and the CIA, Office of Inspector General. The claims settled by this agreement are allegations only; there has been no determination of liability.

British Contractor Agrees to Plead Guilty to Wire Fraud Conspiracy Related to Iraq Reconstruction Efforts

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FOR IMMEDIATE RELEASE
Monday, December 10, 2012
British Contractor Agrees to Plead Guilty to Wire Fraud Conspiracy Related to Iraq Reconstruction Efforts

WASHINGTON – British contractor APTx Vehicle Systems Limited agreed today to plead guilty to conspiracy to defraud the United States, the Coalition Provisional Authority that governed Iraq from April 2003 to June 2004, the government of Iraq and JP Morgan Chase Bank.  A civil settlement agreement resolving a related action filed under the False Claims Act was also announced today.

APTx was charged with one count of wire fraud conspiracy in a criminal information filed today in U.S. District Court in Massachusetts.  As part of the plea agreement filed with the information, APTx agreed to pay a criminal fine of $1 million.

The charges and resolutions were announced today by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division, Principal Deputy Assistant Attorney General Stuart F. Delery of the Justice Department’s Civil Division and U.S. Attorney for the District of Massachusetts Carmen M. Ortiz.

According to the criminal information, APTx engaged in a fraudulent scheme involving an August 2004 contract valued at over $8.4 million for the procurement of 51 vehicles for the Iraqi Police Authority.  The contract was initially awarded to a different, “prime” contractor, which in turn subcontracted the procurement to APTx for over $5.7 million.  Payment under the contract was by letters of credit issued by JP Morgan Bank.

The criminal information further charges that in May and June 2005, APTx submitted shipping documents to JP Morgan to draw down on the letters of credit, which falsely and fraudulently asserted that all 51 vehicles were produced and ready to ship to Iraq.   In fact, as APTx knew, none of the vehicles had been built, none of the vehicles were legally owned or held by APTx and none of the vehicles were in the process of transport to Iraq.  The fraudulent shipping documents also listed a company as the freight carrier that APTx knew was not a shipping company and named a fictitious company as the freight forwarder.

In a related civil settlement agreement, APTx, along with Alchemie Grp Ltd., a United Kingdom corporation, and Haslen Back, the director and shareholder of Alchemie, agreed to pay $2 million to the United States to resolve claims originated by Ian Rycroft, an individual retained by the prime contractor to oversee transportation of the vehicles, under the qui tam, or whistleblower, provisions of the False Claims Act in the District of Massachusetts.  The False Claims Act authorizes private whistleblowers to bring suit for false claims submitted to the United States and to share in any recovery.  Rycroft’s estate will receive $540,000 as its share of the settlement amount.

Benjamin Kafka, a representative for APTx in the United States, was charged on April 13, 2009, with one count of misprision of a felony in connection with his role in the wire fraud conspiracy.  According to court documents, Kafka allegedly allowed APTx to use his corporate name and identity as the freight carrier and freight forwarder on the fraudulent shipping documents presented to JP Morgan.

The criminal case is being prosecuted by Director of Procurement Fraud Catherine Votaw and Trial Attorney William H. Bowne III of the Criminal Division’s Fraud Section, and by Assistant U.S. Attorneys Eugenia M. Carris and Jeffrey Cohen of the District of Massachusetts.  The civil case is being handled by Trial Attorney Diana Younts of the Civil Division, and by Assistant U.S. Attorney Christine Wichers of the District of Massachusetts.  The investigation was conducted by the Special Inspector General for Iraq Reconstruction, the Defense Criminal Investigative Service Boston Resident Agency and U.S. Immigration and Customs Enforcement Homeland Security Investigations in Washington, D.C.

Kentucky-Based Defense Contractors, Owners Agree to Pay $6.25 Million to Resolve Allegations That They Submitted False Statements and Claims to Obtain Army Contracts Intended for Small Businesses

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Kentucky-Based Defense Contractors, Owners Agree to Pay $6.25 Million to Resolve Allegations That They Submitted False Statements and Claims to Obtain Army Contracts Intended for Small Businesses

Kentucky-based Lusk Mechanical Contractors and Commonwealth Technologies, and their owners, Harry Lusk and Wendell Goodman, have agreed to pay $6.25 million to resolve allegations that they submitted false statements to the Small Business Administration and false claims to the Army, the Justice Department announced today.

 

Congress established the Historically Underutilized Business Zone (HUBZone) program in 1997 to help inner cities and rural counties that have low household income and high unemployment, and whose communities have suffered from a lack of investment.   Under the HUBZone program, small businesses that maintain their principal office in a designated HUBZone, and meet certain other requirements, can apply to the Small Business Administration (SBA) for certification as a HUBZone company.  HUBZone companies can then use this certification to their advantage when bidding on government contracts.

 

Today’s settlement resolves allegations that Lusk Mechanical, Commonwealth Technology and their owners made, or caused to be made, false statements to the SBA to obtain certification as a HUBZone company, and then used this certification to wrongfully obtain Army contracts to build a courthouse in Fort Knox, Ky., and to complete maintenance and other repairs to Army facilities in Fort Knox.   Specifically, the United States alleged that in February 2005, Commonwealth submitted an application to the SBA representing that it was a small business with its principal place of business in a designated HUBZone.   In fact, Commonwealth allegedly operated out of Lusk Mechanical’s headquarters, which was not located in a HUBZone area.  Commonwealth’s business office was identified on the application as 212 East Caroline Street, Irvington, Ky.   The United States alleged that this location was nothing more than a vacant office space with no employees, and that Commonwealth’s application did not disclose that Wendell Goodman and Harry Lusk were, in fact, affiliated with Lusk Mechanical.   At the time, Harry Lusk and his wife were the sole owners of Lusk Mechanical and Wendell Goodman was the chief executive officer of Lusk Mechanical.   According to the United States’ allegations, neither Lusk nor Goodman disclosed in the application to the SBA that Commonwealth did not operate as an independent company, but instead shared facilities, equipment, personnel, insurance and bonding with Lusk Mechanical, nor did they inform the SBA about the financial relationship between Commonwealth and Lusk Mechanical.  The United States alleged that, using the falsely obtained HUBZone certification, the companies obtained contracts from the Army that had been restricted to qualified HUBZone companies, in violation of the False Claims Act and the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA).

 

Under the terms of the settlement, Commonwealth, Lusk Mechanical, Goodman, and Lusk have agreed to pay $3,741,739.96, and to forfeit $2,506,260.24 seized by federal agents from their bank accounts under a civil forfeiture action.

 

“As our economy continues to improve, the HUBZone program provides a critical lifeline to small businesses that voluntarily choose to locate in areas that often have difficulty attracting business,” said Stuart F. Delery, Principal Deputy Assistant Attorney General for the Justice Department’s Civil Division.   “Companies that set up sham offices not only break the law, but deprive the HUBZone communities and legitimate HUBZone businesses of the benefits of the HUBZone program.”

 

“They abused a program meant to assist small businesses located in financially disadvantaged communities,” stated David J. Hale, U.S. Attorney for the Western District of Kentucky. “Today’s multimillion dollar settlement is the result of a successfully coordinated effort among law enforcement agencies and the Department of Justice, working together to hold these business owners accountable.”

 

“The HUBZone Program offers significant benefits to eligible small businesses and is an important tool for unlocking the potential of historically underutilized business zones,” said Inspector General Peggy E. Gustafson of the Small Business Administration. “Preferences for federal contract awards must not be given to persons who lie in order to claim eligibility.   I applaud the dedication and perseverance of our law enforcement partners as justice is served here today on behalf of the American taxpayer”

 

“SBA’s contracting programs, including the HUBZone program, provide small businesses with the opportunity to grow and create jobs,” stated SBA’s General Counsel Sara Lipscomb.  “But, SBA has no tolerance for waste, fraud or abuse in any government contracting program and is committed to ensuring the benefits of these programs flow to the intended recipients.  SBA works closely with our federal partners to prevent bad actors from participating in contracting programs and taking action and holding those accountable when they lie to or mislead the government.”

“This investigation is the result of a highly successful joint effort by the Defense Criminal Investigative Service (DCIS) and one of our key law enforcement partners — the SBA’s Office of Inspector General, in collaboration with the Department of Justice.   Fraud in military contracting undermines the confidence of the American public who demand a military procurement system that spends their tax dollars wisely and responsibly.   This investigation should serve as a warning for those who submit false claims for U.S. military and public funds that DCIS will aggressively investigate these matters,” said Bret Flinn, Resident Agent in Charge of the DCIS Dayton Resident Agency.

 

Principal Deputy Assistant Attorney General Delery thanked the U.S. Attorney’s Office for the Western District of Kentucky, the Office of General Counsel and the Office of the Inspector General for the Small Business Administration, the Defense Criminal Investigative Service, and the Justice Department’s Commercial Litigation Branch for the collaboration that resulted in today’s settlement.   The claims settled by this agreement are allegations only, and there has been no determination of liability.

Palmview Siblings Sentenced for Health Care Fraud Conspiracy

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Palmview Siblings Sentenced for Health Care Fraud Conspiracy

Nov. 28, 2012

McALLEN, Texas – Velma Alaniz, 31, and her brother Valente Alaniz, 27, both of Palmview, have been sentenced to federal prison for their roles in a scheme to defraud Medicare and Medicaid through fraudulent billings for power wheelchairs, incontinent supplies and other medical items, United States Attorney Kenneth Magidson announced today along with and Texas Attorney General Greg Abbott.

Velma Alaniz, an owner of Ace Medical Equipment and Supplies, a McAllen-area durable medical equipment (DME) business, and her brother Valente, manager of Ace Medical, were both convicted of conspiracy to commit health care fraud on Dec. 7, 2011, after pleading guilty before U.S. District Judge Randy Crane.

Following the sentencing hearing that began on Nov. 19-20 and concluded today, Judge Crane ordered Velma and Valente Alaniz to serve 24 and 37 months in prison, respectively. Both will be placed on supervision for a period of three years following their release from prison. Judge Crane also ordered them to repay Medicare and the Texas Medicaid program the sum of $159,557.43.

At their plea hearing in December 2011, Velma and Valente Alaniz admitted to conspiring to submit false and fraudulent claims to the Medicare and Medicaid programs related to Ace Medical’s purported sale of power wheelchairs to Medicare and Medicaid patients. In numerous claims for a power wheelchairs, the defendants represented to Medicare and Medicaid that the items were prescribed by the patients’ physicians and had been delivered to the patients when, in fact, the defendants knew that both of these representations were false. In other instances, the defendants submitted false claims to Medicare and Medicaid that represented that power wheelchairs had been delivered to patients when, instead, less expensive scooters were delivered to the patients. The defendants also billed for incontinent and other medical supplies which had not been prescribed by the patients doctors.

The defendants also admitted that, in an attempt to conceal and cover up their fraud, they falsified and forged physicians’ medical orders and examination reports, as well as a variety of other Medicare and Medicaid-related documents that were kept in Ace Medical’s patients’ files. In addition, in 2010 when investigators requested patient files from Ace Medical pertaining to a number of Medicare and Medicaid patients, Velma Alaniz instructed Valente Alaniz to “fix” the patients’ files to make the fraudulent power wheelchair claims appear to be mere billing errors.

Judge Crane allowed the pair to remain on bond and to voluntarily surrender to the United States Marshals Service on Jan. 4, 2013.

The investigation leading to the charges was conducted by the U.S. Department of Health and Human Services—Office of Inspector General, the U.S. Secret Service and the Texas Attorney General’s Medicaid Fraud Control Unit. Special Assistant United States Attorney Rex Beasley and former Assistant United States Attorney Greg Saikin prosecuted the case.

Chicago Psychiatrist Allegedly Submitted At Least 190,000 False Claims to Medicare and Medicaid; Lawsuit Alleges Kickbacks to Prescribe Antipsychotic Medication for Nursing Home Patients

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press release NDIL

Mississippi Resident Pleads Guilty To Medicare Fraud Scheme Involving Power Mobility Devices

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November 15, 2012

Memphis, TN – Tess Gurley Rouse, 41, of Corinth, Mississippi, pleaded guilty today to one count of defrauding Medicare of more than $368,000, announced United States Attorney Edward L. Stanton III.

Using her company, Eagle Eye Durable Medical Equipment in Counce, Tennessee, Rouse falsified claims electronically for Power Mobility Devices for Medicare beneficiaries in West Tennessee, North Mississippi and elsewhere. Many of the recipients would not have qualified for these devices under the criteria established by Medicare.

To further her scheme, Rouse supplied false documents including prescriptions, written orders, face-to face examinations, and detailed product descriptions purported to have the signature of the treating and referring physician.

Rouse is scheduled to be sentenced on March 21, 2013, at 1:30 p.m., by Judge J. Daniel Breen. She could receive up to 10 years in federal prison, up to a $250,000 fine, and be forced to pay restitution. There is no parole in the federal prison system.

These cases were investigated by the Department of Health and Human Services-Office of Inspector General. These cases were prosecuted by Assistant United States Attorney Stuart Canale on behalf of the government.

Indictment: Kidney Dialysis Patients Received Misbranded Drugs

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TOPEKA, KAN. – A Tennessee pharmacist is charged with substituting a cheaper drug imported from China for the iron sucrose that the Federal Drug Administration has approved for kidney dialysis patients, U.S. Attorney Barry Grissom said today.

Robert Harshbarger, Jr., 53, Kingsport, Tenn., doing business as American Inhalation Medication Specialists, Inc., is charged with one count of selling misbranded drugs, one count of mail fraud and five counts of health care fraud.

The indictment alleges that as a result of fraud by Harshbarger kidney dialysis patients treated by Kansas Dialysis Services, L.C., received iron sucrose that had not been certified by the FDA to meet quality and safety standards.

“Although there are no reports of patient harm associated with the drugs that are alleged to be misbranded in this indictment, patient health was put at risk,” said U.S. Attorney Barry Grissom. “The FDA cannot assure the safety and effectiveness of products that are not FDA approved and come from unknown sources and foreign locations, or that may not have been manufactured under proper conditions. These unknowns put patients’ health at risk because of uncertainty concerning the product’s content, purity and source.”

Grissom said there is no reason for current or former patients of Kansas Dialysis to be concerned at this time. The events outlined in the indictment ended in 2009. Any significant iron deficiencies would have been addressed during the course of a patient’s dialysis treatments. Nevertheless, any questions should be addressed to a physician, Grissom said.

The indictment alleges that Harhbarger’s company, American Inhalation Medication Specialists, Inc., of Kingsport, Tenn., received more than $875,000 from Kansas Dialysis and more than $845,000 from health care benefit programs including Medicare and Medicaid for misbranded iron sucrose sold from 2004 to 2009. Harshbarger misrepresented the iron sucrose drug as Venofer, which is the only iron sucrose drug approved by the FDA for both pre-dialysis and post-dialysis patients.

Harshbarger purchased iron sucrose from Chinese companies including Qingdao Shenbang Chemical Company in Qingdao, China, and Shanghai Rory Fine Chemicals Co., Ltd., in Shanghai, China. The iron sucrose from China was cheaper than purchasing Venofer.

If convicted, Harshbarger faces a maximum penalty of 20 years in federal prison and a fine up to $250,000 on the mail fraud count; a maximum penalty of 10 years and a fine up to $250,000 on each of the health care fraud counts; and a maximum penalty of three years and a fine up to $250,000 on the charge of selling a misbranded drug. The Food and Drug Administration and the Dept. of Health and Human Services, Office of Inspector General, investigated. Assistant U.S. Attorney Tanya Treadway is prosecuting.

OTHER INDICTMENTS

Two men who were executives of the Brooke Companies, a now defunct insurance franchising business in Kansas, have been indicted on federal financial fraud charges.

Robert D. Orr, 59, Denver, Colo., and Leland G. Orr, 50, Phillipsburg, Kan., are charged with one count of conspiracy to defraud the Securities and Exchange Commission and three counts of making false statements in filings to the SEC. In addition, Robert Orr is charged with two more counts of making false statements in SEC filings and one count of bankruptcy fraud.

The Orrs were executives of Brooke Corporation, a holding company headquartered in Overland Park and Phillipsburg, Kan., that was engaged primarily in insurance franchising, insurance agency financing and banking. Brook Corporation owned a majority interest in Brooke Capital, Aleritas and Brooke’s Savings Bank. Brooke Capital sold insurance agency franchises and provided bookkeeping and other support services for franchises. Aleritas sold the majority of loans it made to franchisees and typically remained responsible for loan servicing. The companies were known collectively as the Brooke Companies.

The indictment alleges that in 2007 and 2008 the Brooke Companies experienced increasingly dire liquidity conditions and rapidly declining franchise financial health. In attempting to conceal financial problems, Brooke Companies’ management misrepresented the number of viable franchises, the health of Aleritas’ loan portfolio and other material financial information to the SEC, investors and lenders. They conspired to present a false aggregate picture of the Brooke Companies’ financial condition and thereby to obtain money, dividend payments and cash transfers for themselves.

If convicted, they face a maximum penalty of 20 years in federal prison and a fine up to $5 million on each count of making a false statement in SEC filings; and a maximum of five years and a fine up to $250,000 on each of the other counts. The FBI investigated. Assistant U.S. Attorney Mike Warner is prosecuting.

Bryan K. Carter, 32, Topeka, Kan., is charged with unlawful possession of a firearm after a felony conviction. The crime is alleged to have occurred Dec. 13, 2011, in Shawnee County, Kan.

If convicted, he faces a maximum penalty 10 years and a fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated. Assistant U.S. Attorney Duston Slinkard is prosecuting.

Omar Romero Salgado, 18, currently in custody in the Shawnee County Jail, is charged with one count of possession with intent to distribute methamphetamine, one count of possession with intent to distribute Clonazepam, one count of possession of a firearm in furtherance of drug trafficking and one count of possession of a stolen firearm. The crimes are alleged to have occurred Oct. 30, 2012, in Shawnee County, Kan.

If convicted, he faces a maximum penalty of 20 years and a fine up to $1 million on the methamphetamine charge; a maximum penalty of five years and a fine up to $250,000 on the Clonazepam charge; a penalty of not less than five years and a fine up to $250,000 on the charge of possessing a firearm in furtherance of drug trafficking; and a maximum penalty of 10 years and a fine up to $250,000 on the charge of possession of a stolen firearm. The FBI investigated. Assistant U.S. Attorney Jared Maag is prosecuting.

Xavier Patrick McCullough, 24, currently in custody in the Shawnee County Jail, and Ryan Cole Palmer, 25, currently in custody in the Shawnee County Jail, are charged with one count of possession with intent to distribute marijuana, one count of possession with intent to distribute methamphetamine and one count of possession of a firearm in furtherance of drug trafficking.

If convicted, they face a maximum penalty of 20 years and a fine up to $1 million on the methamphetamine charge; not less than five years and a fine up to $250,000 on the firearm charge; and a maximum penalty of five years and a fine up to $250,000 on the marijuana charge. The Topeka Police Department and the FBI investigated. Assistant U.S. Attorney Jared Maag is prosecuting.

In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.

Indictments Returned in Hammond Federal Court (USAO-NDIN)

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HAMMOND, IN—The United States Attorney’s Office announced that the following Indictments were returned on November 8, 2012:

  • Hoosier EMS Roy Dunn, 59, and Kahley Vergon-Mayotte, 27, both of Winimac, Indiana; and Anthony Bitterling, 39, of Monticello, Indiana, were charged in an indictment with conspiracy to commit health care fraud. These charges were filed as the result of an investigation by the Federal Bureau of Investigation, the United States Department of Health and Human Services, and the Indiana Medicaid Fraud Control Unit. This case has been assigned to and will be prosecuted by Assistant United States Attorney Diane Berkowitz.
  • Edwin Tollinchi-Rodriguez, 27, of East Chicago, Indiana, was charged in an indictment with aggravated sexual abuse. This case resulted from an investigation by members of the Indiana Internet Crimes Against Children Task Force, including the Federal Bureau of Investigation; the East Chicago Police Department; and the Lansing, Illinois Police Department. This case has been assigned to and will be prosecuted by Assistant United States Attorney Jill Koster.
  • Kevin Paul Brewster, 40, of Portage, Indiana, was charged in an indictment with four counts of production of child pornography, one count of receipt of child pornography, and one count of possession of child pornography. This case resulted from an investigation by members of the Indiana Internet Crimes Against Children Task Force, including the Federal Bureau of Investigation and the Portage Police Department. This case has been assigned to and will be prosecuted by Assistant United States Attorney Jill Koster.
  • Austin Nwaka, dba Service Above Self, of Canby, Indiana, and Phyllis Lark, dba Absolute Care, of Hammond, Indiana, were charged in an indictment with health care fraud. Lark was also charged with making false statements to a federal agent. These charges were filed as the result of an investigation by the Federal Bureau of Investigation and the Indiana Medicaid Fraud Control Unit. This case has been assigned to and will be prosecuted by Assistant United States Attorney Diane Berkowitz.
  • Daron Moten, 23, of Gary, Indiana, was charged in an indictment with possession of a firearm by a convicted felon. These charges were filed as the result of an investigation by the by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Gary Police Department. This case has been assigned to and will be prosecuted by Special Assistant United States Attorney Armando Salinas, Jr.
  • Michael J. Plake, 47, of Lafayette, Indiana, and Paul Cardwell, 46, formerly of Monticello, Indiana, were charged in an indictment with conspiracy to commit mail fraud. These charges were filed as the result of an investigation by the Federal Bureau of Investigation. This case has been assigned to and will be prosecuted by Assistant United States Attorney Diane Berkowitz.

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.

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.