News Stories: Florida Medicare Fraud

July 15, 2010

HHS Announces New Tool to Help Fight Health Care Fraud in Florida

HHS Secretary Sebelius and Attorney General Holder to Co-Host Fraud Prevention Summit Tomorrow in Miami

U.S. Health and Human Services Secretary Kathleen Sebelius announced today that health care fraud fighters in the state of Florida will now have additional funding to help find potential fraud and abuse in the state’s Medicaid program through the use of Medicaid claims data.

Today, Secretary Sebelius approved Florida’s Medicaid waiver request to help fund a demonstration program that will allow the state’s Medicaid Fraud Control Unit (MFCU) to “mine” Medicaid Management Information System (MMIS) data to identify cases of potential Medicaid fraud.

Medicaid billing for many health care services in South Florida is disproportionately high compared to other parts of the country. Although significant progress has been made, fraudulent billing health care fraud continues to cost Medicaid millions of dollars. 

“To fight health care fraud, we need to coordinate all of the resources and data we can muster,” said Secretary Sebelius. “By allowing the state of Florida to use more information to find potential fraud in Medicaid, this waiver will improve Florida’s ability to effectively identify and combat fraud and abuse.”

The announcement comes in advance of the Department of Health and Human Services and Department of Justice’s first Regional Health Care Fraud Prevention Summit being held tomorrow at the Knight Center in Miami, Fla.

The summit, which will feature keynotes remarks by U.S. Attorney General Eric Holder and Secretary Sebelius, kicks off the first in a series of day-long summits bringing together a wide array of federal, state, and local partners, beneficiaries, providers, and other interested parties to discuss innovative ways to eliminate fraud within the U.S. health care system.

As part of its efforts to coordinate the fight against fraud across the nation’s health care systems, including Medicaid and Medicare, data mining will allow Florida’s MFCU to sort electronic claims through the use of statistical models and intelligent technologies to uncover patterns and relationships.  Using the identified patterns, investigators can review Medicaid claims activity and history to find abusive or abnormal use of services and billing that may be potentially fraudulent.  Data mining is done with software programs which include algorithms that automatically analyze the MMIS data.

Currently, state MFCUs are prohibited from using federal Medicaid matching funds to detect potential fraud through routine claims review procedures such as screening of claims, analysis of billing practice patterns, or routinely verifying that billed services were actually received by patients, since these functions are a primary program operation function of the state Medicaid agency.  Instead, MFCUs generally rely on referrals from the State Medicaid agency.  The waiver approved today will allow the Florida MFCU to use federal matching funds to apply sophisticated electronic data mining tools that are beyond the scope of the claims review activities normally performed by the State Medicaid agency to identify potential fraud.  

The Centers for Medicare & Medicaid Services (CMS) expects the MFCU to work closely with AHCA to ensure their collective efforts are effective. CMS will monitor the progress of this waiver in conjunction with the HHS Office of Inspector General, which has oversight of MFCUs.

“The demonstration approved today will allow Florida’s Medicaid Fraud Control Unit to take full advantage of their expertise in detecting and investigating Medicaid fraud,” said CMS Administrator Don Berwick, M.D. 

May 14, 2010

Durable Medical Equipment Company Owner Sentenced to 144 Months in Medicare Fraud Scheme (U.S. Attorney for the Southern District of Florida)

MIAMI - Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, announced today that United States District Court Judge Joan Lenard sentenced defendant Yasmanny Benavides, 28, of Miami, Florida, to a term of 144 months’ imprisonment following his conviction at trial of health care fraud. The court also ordered restitution in the amount of $6,206,697, which represented the amount of Medicare funds stolen by the defendant. 

According to the indictment and evidence admitted at trial, defendant Benavides controlled and operated Lacary Medical Services Equipment, Inc. that purportedly did business in Miami-Dade County providing durable medical equipment to Medicare beneficiaries.  From July 2003, through December 2003, Benavides as President, Secretary, and Registered Agent of Lacary Medical, caused the submission of false and fraudulent claims to Medicare on behalf of Lacary Medical, in the amount of $4,865,970, seeking reimbursement for the cost of DME items and services that were not prescribed by doctors or provided as claimed.

According to statements made in court, Defendant Benavides then controlled and operated Lily Orthopedic, Inc. that purportedly did business in Miami-Dade County providing durable medical equipment to Medicare beneficiaries.  From December 2003, through August 2004, Benavides and co-conspirator Reinaldo Guerra caused the submission of false and fraudulent claims to Medicare on behalf of Lily Orthopedic, in the amount of $14,555,868, seeking reimbursement for the cost of DME items and services that were not prescribed by doctors or provided as claimed.

Defendant Benavides came to the government’s attention during the investigation of All-Med Billing Corp. 

At sentencing, United States District Court Judge Joan Lenard noted the severe harm caused to the taxpayers as a result of defendant’s conduct in stealing over $6 million of funds dedicated to the care of the elderly and disabled, especially in light of the current health care funding issues that exist in this country.

Mr. Ferrer commended the investigative efforts of the Federal Bureau of Investigation, and the U.S. Department of Health and Human Services, Office of the Inspector General.  This case is being handled by Assistant U.S. Attorney Christopher J. Clark.     

A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

May 14, 2010

Miami-Area Clinic Owner Charged in $23 Million Health Care Fraud Scheme (U.S. Attorney for the Southern District of Florida)

A Miami-area resident who owned and operated an HIV infusion clinic was arrested on May 14, 2010, and charged for her alleged participation in a $23 million HIV infusion Medicare fraud scheme, the Departments of Justice and Health and Human Services (HHS) announced. 

An indictment unsealed in U.S. District Court in Miami charges Flor Crisologo, 58, with one count of conspiracy to defraud the United States, to cause the submission of false claims to the Medicare program, and to pay health care kickbacks; one count of conspiracy to commit health care fraud; and three counts of submitting false claims to the Medicare program. Crisologo also is charged with one count of conspiracy to launder the proceeds of her crimes and four counts of money laundering.   Crisologo made her initial appearance today in U.S. District Court in Miami before Magistrate Judge William C. Turnoff. 

According to the indictment, Crisologo was the owner and operator of J & F Community Medical Center Inc.  The indictment alleges that Crisologo submitted approximately $23 million in false and fraudulent claims to the Medicare program for HIV injection and infusion services purportedly provided through J & F.  According to the indictment, Crisologo hired a physician at J & F and caused the physician to order unnecessary tests, sign false medical analyses and diagnosis forms, and authorize treatments to make it appear that medical services were being provided to patients who were Medicare beneficiaries.  The services included medically unnecessary injection and infusion therapies.  The indictment alleges that Crisologo and her co-conspirators paid Medicare beneficiaries kickbacks to induce the beneficiaries to claim they received legitimate services at the clinic when in fact the HIV infusion services were either not provided or were not medically necessary. 

According to the indictment, Crisologo engaged in a scheme to launder the proceeds of the fraudulent Medicare claims by, among other things, transferring thousands of dollars in proceeds to two shell corporations that she owned and controlled, ABC Med Way Inc., and MSG Investment and Services Corp.

The maximum sentence for each count of conspiracy to defraud the United States and filing false claims is five years in prison. The maximum sentence for each count of conspiracy to commit health care fraud, conspiracy to commit money laundering and money laundering is 10 years in prison. The indictment seeks forfeiture of assets held by the defendant. 

An indictment is merely a charge and defendants are presumed innocent until proven guilty. The charges were announced by U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida; Assistant Attorney General Lanny A. Breuer of the Criminal Division; John V. Gillies, Special Agent-in-Charge of the FBI’s Miami field office; and Special Agent-in-Charge Christopher Dennis of the HHS Office of Inspector General (HHS-OIG), Office of Investigations Miami office.

This case is being prosecuted by Trial Attorney 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 Miami.  

Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 560 individuals who collectively have falsely billed the Medicare program for more than $1.2 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.

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

A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

May 04, 2010

MiamiClinic Consultant Convicted in $5.8 Million Fraudulent HIV Infusion Scheme (U.S. Attorney for the Southern District of Florida)\

Miami - David Marrero, 49, was convicted May 4, 2010 of health care fraud, conspiracy to commit money laundering and money laundering in connection with a $5.8 million Medicare fraud scheme relating to his involvement with a Miami-area HIV/AIDS infusion clinic, announced the Departments of Justice and Health and Human Services (HHS).

According to evidence at trial, in 2004, Marrero established Tendercare Medical Center Inc., with his then wife, listing himself as a “clinic consultant” on Tendercare’s Medicare application. In 2005, Tendercare began billing Medicare for expensive injection and infusion medications purportedly to treat HIV/AIDS-related blood disorders.

Marrero recruited Medicare beneficiaries to come to Tendercare and hired Tendercare employees.  The evidence at trial showed that these beneficiaries did not have the conditions listed in the Medicare billings for the clinic, and that the employees did not actually administer the treatments for which Medicare was billed.  According to evidence presented at trial, between January 2005 and December 2007, Tendercare submitted approximately $5.8 million in false and fraudulent claims to Medicare for medically unnecessary injection and infusion treatments, most of which were not even provided.  Medicare paid Tendercare approximately $2.7 million as a result of those fraudulent claims.

At trial, evidence showed that Marrero recruited his 76-year-old aunt to be a “patient” at Tendercare and reached an agreement with the then-owner of Tendercare to receive a portion of whatever Medicare paid Tendercare for billings under his aunt’s name.  According to the bills submitted to Medicare, this woman was HIV positive, had multiple blood disorders, and during her first “treatment” received 100 units of medication for which Medicare was billed more than $10,000.  In fact, as the evidence showed at trial, his aunt was not HIV positive and was not suffering from blood disorders. In addition, a Medicare representative testified that it was medically impossible to inject a patient with 100 units of this medication in a single office visit, which was the equivalent of an injection of approximately one liter of medication.  According to the Medicare representative, there are now certain safeguards in place to prevent Medicare from paying clinics for this type of medically impossible bill.

At trial, a former employee of Tendercare testified that Marrero trained her on how to manipulate blood samples in order to generate a phony lab test that could be used to justify the company’s fraudulent billings. Evidence at trial also showed that Tendercare paid cash kickbacks to Medicare beneficiaries to induce them to participate in the scheme.

Following the verdict, Marrero was remanded into custody by U.S. District Court Judge Donald L. Graham of the Southern District of Florida. Sentencing for Marrero is currently scheduled for July 30, 2010, before U.S. District Judge Ursula Ungaro of the Southern District of Florida. Marrero faces a statutory maximum prison term of up to 10 years on each count for which he was convicted, in addition to a criminal fine of up to $250,000 or twice the gain or loss, whichever is greater.

Yesterday’s guilty verdict was announced by U.S. Attorney Wifredo A. Ferrer for the Southern District of Florida, Assistant Attorney General Lanny A. Breuer of the Criminal Division, and Special Agent in Charge Christopher B. Dennis of the Miami Regional Office of the HHS Office of Inspector General (OIG).

The case was prosecuted by Assistant Chief John S. (Jay) Darden and Special Trial Attorney Martha Talley of the Criminal Division’s Fraud Section.  The case was investigated by the FBI.  The case was brought as part of the Medicare Fraud Strike Force, supervised by the U.S. Attorney’s Office for the Southern District of Florida and the Criminal Division’s Fraud Section.

Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 560 individuals who collectively have falsely billed the Medicare program for more than $1.2 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.

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

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

April 12, 2010

Miami Man Pleads Guilty To $61 Million Medicare Fraud Scheme (U.S. Attorney for the Southern District of Florida) 

Miami, Florida - Jeffrey H. Sloman, United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, Amos Rojas, Jr., Special Agent in Charge, Florida Department of Law Enforcement, Miami Regional Operations Center, and Daniel W. Auer, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division, announced that defendant Ihosvany Marquez, of Miami-Dade County, pled guilty on April 12, 2010 to charges of conspiracy to commit Medicare fraud, conspiracy to commit money laundering, and aggravated identity theft.  Another defendant, Michel De Jesus Huarte, pled guilty in November 2009 to a related Medicare fraud scheme, and was sentenced in January 2010 to twenty-two (22) years’ imprisonment. 

Marquez’s plea agreement contained a detail factual proffer that was filed with the Court.  In the factual proffer, Marquez admitted that he, along with co-defendant Michel De Jesus Huarte and others, operated and controlled eight purported medical clinics in Miami-Dade and Orange counties.  These clinics were Zigma Medical Care, Inc., Tender Loving Care Medical Center, Inc., Professional Medical Health, Inc., Metro Med Care, Inc., San Diego Medical & Rehab Center, Inc., Eulogia's Diagnostic Medical Center, Inc., Stirling Medical & Rehab, and Stop Injury Medical Center, Inc.  These clinics submitted at least $61 million in false claims to Medicare for infusion therapy, injection therapy, and other expensive medical treatments designed to treat Medicare beneficiaries suffering from a wide variety of ailments, including cancer, HIV, AIDS, chronic pain, and varicose veins.  Based on these fraudulent claims, Medicare paid Marquez and his conspirators approximately $23.9 million.

To conceal their involvement in the scheme, Marquez and his conspirators  recruited nominee or “straw” owners for each company, and paid them large sums of cash to sign the corporate records, bank records, and other business documents before fleeing the country to avoid arrest.  One such nominee owner, Madelin Machado of Zigma Medical, was indicted in the Southern District of Florida in January 2008 (Case No. 08-20033-HUCK), and remains a fugitive today.

During his plea, Marquez admitted that he laundered the Medicare fraud proceeds through a Miami-area car dealership, and also through two Miami check cashing stores– Pelly Box Lunch and La Bamba Check Cashing.  To facilitate these laundering schemes, Marquez also filtered the money through dozens of shell corporations, many of which contained words like “telemarketing,”  “construction,” “investment,” or “leasing” in the title to make the companies look legitimate.  Example shell corporations included Babalu Telemarketing, Madreagua Construction, Palomayonve Construction, Biramundo Telemarketing, and Shine Telemarketing. 

Marquez also admitted during the plea that he used Medicare fraud proceeds to buy approximately $2.7 million of luxury cars, including a Lamborghini Gallardo, a Lamborghini Murcielago, a Ferrari 612 Scaglietti, two (2) Bentley Continental GTs, two (2) Mercedes Benz CL63s, and at least six (6) Mercedes Benz S550s.  Marquez also used fraud proceeds to buy more than $1 million of thoroughbred racing horses, and more than $545,000 worth of jewelry and diamonds.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation, the Florida Department of Law Enforcement, and the Internal Revenue Service, Criminal Investigation Division.  This case is being prosecuted by Assistant U.S. Attorneys Ryan Stumphauzer and Daniel Bernstein.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the United States District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

April 9, 2010

Two Miami-Dade Residents Plead Guilty To $21 Million Healthcare Fraud Scheme (U.S. Attorney for the Southern District of Florida) 

Miami, Florida - Jeffrey H. Sloman, United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, Miami Regional Office, announced today that defendants Efren Mendez and Damian Beltran, residents of Miami-Dade County, Florida, each pled guilty today to one count of conspiracy to commit health care fraud.

According to the facts submitted by the parties at their plea hearings, the fraud involved purported treatment of HIV+ Medicare beneficiaries at Research Center of Florida, Inc.  From October 2003 through November 2004, Research Center, submitted $21,043,982 in Medicare claims, almost all of which were for treatment of HIV+ patients. Based on these claims, Medicare paid Research Center $10,944,088. However, Research Center personnel generally administered smaller doses of the medications than Research Center purported in its claims, or no treatment at all.

Mendez was the vice-president of Research Center.  At his plea hearing, he admitted that, in conjunction with the clinics President, he decided what claims to submit to Medicare, knowing that the treatment would not be provided.  Mendez further admitted that he and the clinics President arranged to pay cash kickbacks to Medicare beneficiaries to attend Research Center as purported patients.

Beltran was a medical assistant at Research Center.  At his plea hearing, he admitted that he prepared false documentation purporting to have provided treatment to patients that in fact had not been provided.

Each defendant faces a maximum sentence of ten (10) years imprisonment.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, Office of Inspector General.  This case is being prosecuted by Assistant U.S. Attorney Marc Osborne.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

April 7, 2010

Six Miami Residents Charged in $13 Million Health Care Fraud Scheme (U.S. Attorney for The Southern District of Florida) 

Six Miami-area residents have been charged for their alleged role in a $13.6 million health care fraud scheme involving a Miami-area HIV infusion clinic, announced the Departments of Justice and Health and Human Services (HHS). 

In a 16-count indictment returned on March 30, 2010, and unsealed today, the six defendants are charged with conspiring to submit $13.6 million in false and fraudulent claims to the Medicare program for HIV infusion services that were allegedly provided at T & R Rehabilitation Clinic (T&R Rehab) in Miami.  Modesto De La Vega, 58; Rolando Nogueira, 48; Joaquin Vega, M.D., 73; Gladis Badia, 39; Jose Nogueira, aka “Tony Nogueira,” 52; and Victoria De La Vega, 59, were each charged with one count of conspiracy to defraud the United States, to cause the submission of false claims and to pay health care kickbacks; one count of conspiracy to commit health care fraud; and three counts of submitting false claims to the Medicare program. In addition, Modesto De La Vega and Rolando Nogueira were each charged with one count of conspiracy to launder the proceeds of their crimes and multiple money laundering counts.

Modesto De La Vega, Dr. Joaquin Vega, Gladis Badia and Victoria De La Vega were taken into custody this morning and will make their initial appearances today at 2:00 p.m., before U.S. Magistrate Judge Stephen T. Brown.  Ronald and Jose Nogueira are considered fugitives.

According to the indictment, Rolando Nogueira owned and operated T & R Rehab while Modesto De La Vega was the operator of T & R Rehab’s HIV infusion practice.  The indictment alleges that Rolando Nogueira and Modesto De La Vega billed the Medicare program for HIV infusion therapy services that were medically unnecessary and were never provided.  In addition, Modesto and Victoria De La Vega allegedly paid kickbacks to Medicare beneficiaries to induce them to sign logs at T & R Rehab stating that they had received the treatments that were billed to Medicare when, in fact, they had not.  The indictment also alleges that Jose Nogueira managed T&R Rehab’s fraudulent HIV infusion operation.

The indictment alleges that Dr. Joaquin Vega maintained a Medicare provider number at T & R Rehab to submit Medicare claims for the medically unnecessary infusion treatments.  Gladis Badia, a medical assistant at T & R, is alleged to have prepared the required documentation to make it appear that the injection and infusion treatments billed by T & R Rehab were medically necessary and provided when, in fact, they were not.

The charge of conspiracy to defraud the United States, to cause the submission of false claims, and to pay health care kickbacks carries a maximum sentence of five years in prison.  The charges of conspiracy to commit health care fraud, conspiracy to engage in money laundering and money laundering each carry a maximum sentence of 10 years in prison.  The charge of submitting false claims to the Medicare program carries a maximum penalty of five years in prison per count.

An indictment is merely a charge and defendants are presumed innocent until proven guilty.

Today’s indictment was announced by U.S. Attorney Jeffrey H. Sloman for the Southern District of Florida; Assistant Attorney General Lanny A. Breuer of the Criminal Division; Special Agent in Charge John V. Gillies of the FBI’s Miami Field Office; and Special Agent in Charge Christopher B. Dennis of the Miami Regional Office of the HHS Office of Inspector General (OIG).

The case is being prosecuted by Trial Attorneys Michael D. Padula and N. Nathan Dimock of the Criminal Division’s Fraud Section. The case is being investigated by the FBI and HHS-OIG.  The case 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 their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 500 individuals who collectively have falsely billed the Medicare program for approximately $1.1 billion. In addition, HHS’s 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.

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

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

March 23, 2010

Three Defendants Arrested in Counterfeit Medicare Check Scheme (United States Attorney for the Southern District of Florida)

Miami - Jeffrey H. Sloman, United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, announced the arrests of Daisy Alonso, 36, formerly of Naples, Florida, and her brother, Ovidio Alonso Sanchez, 37, of Naples, Florida, for exchanging counterfeit Medicare checks, in violation of Title 18, United States Code, Section 473; and the arrest of Azdrubal Martinez, 71, for money laundering, in violation of Title 18, United States Code, Section 1957. 

The defendants were charged in three separate cases.  Daisy Alonso was charged with four counts and Ovidio Alonso Sanchez with seven counts of exchanging counterfeit Medicare checks.  Each counterfeit check count carries a statutory maximum penalty of 20 years in prison.  Defendant Martinez is charged with two counts of money laundering.  If convicted, he faces a maximum statutory penalty of 10 years on each count.  All defendants have made their initial appearances in federal court.  Previously, defendants Ovidio Alonso Sanchez and Azdrubal Martinez were released on bonds. On March 22, 2010, Chief U.S. Magistrate Judge Stephen T. Brown ordered Daisy Alonso detained pending trial.

According to statements made during the March 22, 2010 pre-trial detention hearing, Daisy Alonso established a corporation called “West Hialeah Phay, Inc.” and opened two separate bank accounts for this company.  Although West Hialeah Phay, Inc. had no dealings with Medicare, approximately $191,198 in Medicare checks was deposited into the two West Hialeah Phay, Inc. accounts.  After the checks cleared, thousands of dollars were withdrawn from the accounts.

According to statements made in court, the Medicare checks deposited into Alonso’s West Hialeah Phay, Inc. accounts were fraudulent Medicare checks, with dates and amounts matching checks actually issued to West Hialeah Pharmacy, Inc., another clinic not associated with Alonso that billed Medicare.

Ovidio Alonso Sanchez was charged separately with receiving $327,697 in counterfeit Medicare checks in connection with a company called West Hialeah Pha., Inc.  Finally, Azdrubal Martinez was charged with money laundering for negotiating a $13,500 check from West Hialeah Pha., Inc., and a $15,500 check from Daisy Alonso’s company.

An indictment is only an accusation and a defendant is presumed innocent until and unless proven guilty.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, Office of Inspector General.  This case is being prosecuted by Assistant U.S. Attorney H. Ron Davidson.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

March 18, 2010

Palmetto Physician Pleads Guilty to Illegal Prescription Drug and Medicare Fraud Conspiracies (United States Attorney for The Middle District of Florida)

Tampa, Florida - United States Attorney A. Brian Albritton announces that Dr. Jeffrey Friedlander (age 50, of Palmetto) pleaded guilty, on March 18, 2010, to conspiring to distribute and dispense numerous controlled substances—Oxycodone, Morphine, Hydrocodone, and Alprazolam--and also to conspiring to defraud Medicare. Friedlander faces a maximum penalty of twenty years in federal prison for the drug conspiracy and ten years for the fraud conspiracy.

According to the plea agreement, Friedlander was licensed to practice Internal Medicine, Neurology, Pain Management, and Vascular and Interventional Radiology in Florida. He practiced primarily out of a medical business known as "Neurology and Pain Center" (NPC), with clinics in Tampa, Sarasota, Lakeland, St. Petersburg, Jacksonville, and Orlando. Friedlander also was a participating physician in Medicare. He submitted claims for reimbursement for his services under Medicare Part B and wrote prescriptions for controlled substances for Medicare patients that were filled under Medicare Part D.

While operating the NPC, Freidlander allowed unauthorized and non-medical employees to prescribe controlled substances to patients by using blank prescription forms that he pre-signed. Prescriptions were issued without conducting adequate physical exams, making proper diagnoses, or considering alternative treatment options, and often with the knowledge that the patients receiving the controlled substances were misusing or abusing them, asking for drugs to support their own addictions, or sharing or giving the controlled substances away to others. Undercover detectives with the Hillsborough County Sheriff's Office were able to obtain prescriptions for controlled substances at NPC clinics on numerous occasions in 2008 and 2009 with little or no contact with Friedlander, no meaningful physical examination, no verification of their medical complaints, no diagnostic tests, no discussion of alternate treatment methods, no assessment of risk of abuse, no referrals for physical therapy or other alternative treatments, and no discussion of a treatment plan. Often, the detectives simply asked for particular types of drugs and were given prescriptions for those drugs, with no medical basis and even after making clear that they had shared or intended to share the drugs with others.

The plea agreement also states that, between 2005 and March 2009, Friedlander submitted false claims to Medicare for performing Paravertebral Facet Joint Block Injections, when such injections had not been performed or had been performed improperly, and when some of the injections had been performed by unlicensed nonmedical persons outside Friedlander's supervision. Friedlander also submitted false claims to Medicare for office visits coded at the highest degree of complication and requiring detailed involvement by the treating physician, when, in reality, unlicensed, non-medical persons had performed limited office visits outside of Friedlander's supervision.

Friedlander entered false information in patient files to support the false Medicare claims.

As part of the plea agreement, Friedlander has agreed to forfeit all assets and properties obtained and utilized during the conspiracies, including but not limited to his DEA Controlled Substance Registrations, his Florida Medical License, and a money judgment in the amount of $317,047.13--the gross proceeds traceable to Friedlander's Medicare Fraud conspiracy.

This case was investigated by the United States Department of Health & Human Services, Office of Inspector General; the United States Marshals Service; the Federal Bureau of Investigation; the Florida Department of Law Enforcement; the Florida Department of Health; the Florida Office of the Attorney General Medicaid Fraud Control Unit; the Florida Division of Fraud; and the Hillsborough County Sheriff’s Office. It is being prosecuted by Assistant United States Attorneys Kathy J.M. Peluso and Josie Thomas.

March 2, 2010

Owner of Hialeah Health Care Facilities Sentenced to 112 Months for Threatening Investigators and Defrauding Medicare (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, announced March 2, 2010’s sentencing of defendant Yamill Ramos Perez, 38, of Miami-Dade County, for health care fraud charges and harassing Medicare investigators.  U.S. District Court Judge Patricia A. Seitz sentenced Ramos Perez to 112 months’ imprisonment for health care fraud and 60 months’ imprisonment for interstate harassment.  The sentences are to run concurrent to each other, followed by a three year term of supervised release.  In addition, Judge Seitz ordered restitution in the amount of $5,825,702 and ordered forfeiture of the defendant’s assets.

According to court documents, Ramos Perez owned, through intermediaries, two health care clinics: El Palenque Farmacia Corp. and Meli Pharmacy, both located in Hialeah, Florida. Ramos Perez admitted that the two clinics fraudulently billed Medicare approximately $20,000,000, and received approximately $6,000,000 in fraudulent reimbursements.

After both clinics were placed on “pre-payment review” for suspected fraud, Ramos Perez began a campaign to harass Medicare fraud investigators and a Medicare executive.  His efforts included direct threats by phone to kill a Medicare fraud investigator, threatening telephone calls at a fraud investigator’s home, numerous faxes to Medicare claiming that Ramos Perez would “ruin lives,” and more than 383 emails that flooded a Medicare webpage.

On December 4, 2009, Ramos Perez pled guilty to two counts of conspiring to commit health care fraud, in violation of Title 18, United States Code, Section 1349; and one count of interstate harassment, in violation of Title 18, United States Code, Section 2261A(2)(A). A term of 60 months’ imprisonment represents the statutory maximum on the interstate harassment charge.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, Office of Inspector General. This case is being prosecuted by Assistant U.S. Attorney H. Ron Davidson.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

February 4, 2010

Durable Medical Equipment company Owner Convicted in Medicare Fraud Scheme (U. S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, United States Attorney for the Southern District of Florida, John V. Gilles, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of the Inspector General, announced on Feb. 4, 2010, that a federal jury found defendant Yasmanny Benavides, 28, of Miami, Florida, guilty of conspiracy to commit health care fraud, in violation of Title 18, United States Code, Section 1349 (Count 1); and health care fraud, in violation of Title 18, United States Code, Section 1347 (Counts 2 through 4).  Sentencing is scheduled before United States District Court Judge Joan Lenard on May 10, 2010.

According to the indictment and evidence admitted at trial, defendant Benavides controlled and operated Lacary Medical Services Equipment, Inc. (hereinafter, “Lacary Medical”) that purportedly did business in Miami-Dade County providing durable medical equipment to Medicare beneficiaries.  From July 2003, through December 2003,  Benavides as President, Secretary, and Registered Agent of Lacary Medical, caused the submission of false and fraudulent claims to Medicare on behalf of Lacary Medical, in the amount of $4,865,970, seeking reimbursement for the cost of DME items and services that were not prescribed by doctors or provided as claimed.

Defendant Benavides then controlled and operated Lily Orthopedic, Inc. (hereinafter, “Lily Orthopedic”) that purportedly did business in Miami-Dade County providing durable medical equipment to Medicare beneficiaries.  From December 2003, through August 2004,  Benavides and co-conspirator Reinaldo Guerra caused the submission of false and fraudulent claims to Medicare on behalf of Lily Orthopedic, in the amount of  $14,555,868, seeking reimbursement for the cost of DME items and services that were not prescribed by doctors or provided as claimed.

Defendant Benavides came to the government’s attention during the investigation of All-Med Billing Corp. 

 Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation, and the U.S. Department of Health and Human Services, Office of the Inspector General.  This case is being handled by Assistant United States Attorney Christopher J. Clark.

 A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

February 2, 2010

Former President and Owner of Atenas Medical Equipment, Inc. Convicted of Health Care Fraud Charges (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, announced on Feb. 2, 2010, the conviction of defendant Maria A. Aloise, 41, of Miami-Dade County, on health care fraud charges.

On February 1, 2010, following a six-day trial, a federal jury in Miami found Aloise guilty of ten counts of health care fraud in violation of Title 18, United States Code, Section 1347. According to evidence presented during the trial, Aloise was the president and owner of Atenas Medical Equipment, Inc., a Hialeah-based company that purportedly provided durable medical equipment (“DME”) to Medicare beneficiaries. 

From the summer of 2006 until the spring of 2007, Atenas Medical Equipment submitted approximately $1,421,346 in fraudulent claims to Medicare seeking reimbursement for various types of DME.  The DME included items used in the treatment of chronic obstructive pulmonary disease, such as oxygen concentrators; the treatment of  incontinence, such as urinary leg bags; and DME used to treat other illnesses.  The DME had not been legitimately prescribed by health care providers and had not been provided to Medicare patients.

The defendant executed her fraud scheme using forged prescriptions, certificates of medical necessity, and delivery receipts.  She also fraudulently used identifying information of numerous Medicare beneficiaries and physicians. 

Aloise faces a maximum sentence of ten years’ imprisonment on each of the health care fraud counts.  Sentencing is scheduled for April 2, 2010, before U.S. District Court Judge Adalberto Jordan.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, Office of Inspector General.  This case is being prosecuted by Assistant U.S. Attorney Christopher J. Hunter.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

January 12, 2010

U.S. Lakeland Therapy Clinic Operators Charged with Medicare and Medicaid Fraud (U.S. Attorney for the Middle District of Florida)

Tampa, FL - United States Attorney A. Brian Albritton announces the return by a grand jury of an indictment charging Lilian J. Pagkaliwangan (age 39, of Lakeland) and Raymundo P. Arellano (age 42, of Lakeland) with conspiracy to commit health care fraud, ten counts of making false statements in matters relating to the delivery of and payment for health care services, and three counts of aggravated identity theft. If convicted, each defendant faces a maximum penalty of ten years in federal prison on the conspiracy charge, five years on each of the false statements counts, and two years, to be imposed consecutively, on each of the aggravated identity theft counts. The indictment also notifies the defendants that the United States intends to forfeit a sum of money equal to the amount of proceeds obtained as a result of the offenses. Pagkaliwangan and Arellano made their initial appearances in federal court the morning of January 12, 2010, and were released on their own recognizance.

According to the indictment, Pagkaliwangan and Arellano, a married couple, were licensed physical therapists. Pagkaliwangan also owned and Arellano operated Lakeland Therapy Providers, Inc. (LTP) and Optimum Therapy, Inc. (OTI), two companies in Lakeland, Florida, that provided physical therapy, speech therapy, and occupational therapy services to Medicare and Medicaid beneficiaries and recipients. LTP primarily provided therapy services to pediatric Medicaid patients at the LTP clinic in Lakeland. OTI, through contracts with home health agencies, primarily provided therapy services to Medicare patients who resided at congregate living facilities. The indictment alleges that between approximately April 2006 and June 2008, Pagkaliwangan and Arellano engaged in fraudulent Medicare and Medicaid billing practices at LTP and OTI.

This case was investigated by the U.S. Department of Health and Human Services, Office of Investigations and the Florida Attorney General’s Medicaid Fraud Control Unit. It will be prosecuted by Assistant United States Attorney Robert T. Monk. This case was brought as part of Tampa’s Medicare Fraud Strike Force, a joint effort of the Department of Justice and the Department of Health and Human Services. The Strike Force was formed to address fraudulent billing and other crimes that adversely affect the delivery of health care through the Medicare system. Strike Force investigative agencies include, among others, the Department of Health and Human Services, Office of Investigations, and the Florida Attorney General’s Medicaid Fraud Control Unit.

An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.

January 12, 2010

Clinic Manager Pleads Guilty in Medicare Fraud Scheme (Criminal Division)

Miami resident Ingrid Mazorra pleaded guilty today in U.S. District Court in Miami to participating in a conspiracy to defraud the Medicare program.

Mazorra, 35, pleaded guilty to one count of conspiracy to commit health care fraud before U.S. District Judge Ursula Ungaro.  In pleading guilty, Mazorra admitted that in approximately September 2006, she agreed to help operate a fraudulent infusion and injection clinic, called Xpress Center Inc., in Livonia, Mich.  Mazorra admitted that while the clinic was open, the clinic routinely billed the Medicare program for services that were medically unnecessary or were never provided.  Mazorra admitted that she and her co-conspirators at the clinic had purchased only a small fraction of the medications that the clinic billed the Medicare program for providing. 

Mazorra admitted that Medicare beneficiaries were recruited to come to the clinic through the payment of kickbacks.  Mazorra admitted that in exchange for those kickbacks, the Medicare beneficiaries would visit the clinic and sign documents indicating that they had received the services billed to Medicare.  According to court documents, kickbacks paid to Medicare beneficiaries at the clinic were made in the form of cash and prescriptions for narcotic drugs.  Mazorra also admitted that she and other co-conspirators created false patient files and other false documents to conceal the fraud at Xpress Center, and to make it appear that Xpress Center was a legitimate medical clinic.  

Mazorra admitted that between approximately September 2006 and March 2007, she and her co-conspirators at Xpress Center caused the submission of approximately $2.3 million in false and fraudulent claims to the Medicare program for services purportedly provided at Xpress Center.  Medicare paid approximately $1.8 million on those claims.

Mazorra was originally charged in the Eastern District of Michigan, but after her arrest in Miami, she consented to have her case transferred to the Southern District of Florida for her plea and sentence.  At her sentencing, which is scheduled for March 26, 2010, Mazorra faces a maximum penalty of 10 years in prison and a $250,000 fine.

The case was investigated by the Detroit offices of the FBI and HHS Office of Inspector General (HHS-OIG).  The case is being prosecuted by Trial Attorneys John K. Neal and Benjamin D. Singer of the Criminal Division’s Fraud Section and by Special Assistant U.S. Attorney Thomas W. Beimers of the Eastern District of Michigan.  The case 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 the inception of Strike Force operations in March 2007 - Miami (Phase One), Los Angeles (Phase Two), Detroit (Phase Three), Houston (Phase Four), Brooklyn (Phase Five), Tampa (Phase Six) and Baton Rouge (Phase Seven) - the Strike Force has obtained indictments of more than 460 individuals and organizations that collectively have billed the Medicare program for more than $1 billion.  In addition, HHS’s 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.   

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

January 4, 2010

Miami Resident Charged In $55 Million Medicare Fraud Scheme; Spent $4.8 Million On Exotic Cars, Jewelry, And Horses (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, Amos Rojas, Jr., Special Agent in Charge, Florida Department of Law Enforcement, Miami Regional Operations Center, Christopher B. Dennis, Special Agent in Charge, Department of Health and Human Services, Office of Inspector General, and Daniel W. Auer, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division, announced that defendant Ihosvany Marquez, of Miami-Dade County, was arraigned on Jan, 4, 2010, on an Indictment charging him with conspiracy to commit Medicare fraud, Medicare fraud, conspiracy to commit money laundering, money laundering, and aggravated identity theft.  Another defendant, Michel De Jesus Huarte, was indicted for a closely related Medicare fraud scheme in September 2009, and pled guilty in November 2009. 

The Indictment alleges that Marquez, together with Michel De Jesus Huarte and other unnamed conspirators, operated and controlled seven purported medical clinics in Miami- Dade and Orange counties.  These clinics were Zigma Medical Care, Inc., Tender Loving Care Medical Center, Inc., Professional Medical Health, Inc., Metro Med Care, Inc., San Diego Medical & Rehab Center, Inc., Eulogia's Diagnostic Medical Center, Inc., and Stop Injury Medical Center, Inc.  According to the Indictment, these clinics submitted at least $55 million in false claims to Medicare for infusion therapy, injection therapy, and other expensive medical treatments designed to treat Medicare beneficiaries suffering from a wide variety of ailments, including cancer, HIV, AIDS, chronic pain, and varicose veins.  Based on these fraudulent claims, Medicare paid Marquez and his conspirators approximately $21.6 million.

According to the charges, to conceal their involvement in the scheme, Marquez and his conspirators  recruited nominee or “straw” owners for each company, and paid them large sums of cash to sign the corporate records, bank records, and other business documents before fleeing the country to avoid arrest.  One such nominee owner, Madelin Machado of Zigma Medical, was indicted in the Southern District of Florida in January 2008 (Case No. 08-20033-HUCK), and remains a fugitive today.

Earlier today, U.S. Magistrate Judge Barry L. Garber ordered Marquez be detained pending trial.  During the pretrial detention hearing, the United States stated that Marquez used $2.7 million of Medicare fraud proceeds to purchase numerous luxury and exotic cars, including a Lamborghini Gallardo, a Lamborghini Murcielago, a Ferrari 612 Scaglietti, two (2) Bentley Continental GTs, two (2) Mercedes Benz CL63s, and at least six (6) Mercedes Benz S550s.  The United States further proffered that Marquez spent more than $500,000 on jewelry, and more than $1million on horses during 2007 and 2008.  The United States further proffered that Marquez did not have any reported wages or earnings in the State of Florida, and therefore could not have made such expenditures with legitimate funds. 

An Indictment is only an accusation and a defendant is presumed innocent until and unless proven guilty.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation, the Florida Department of Law Enforcement, the Department of Health and Human Services, Office of Inspector General, and the Internal Revenue Service, Criminal Investigation Division.  This case is being prosecuted by Assistant U.S. Attorneys Ryan Stumphauzer and Daniel Bernstein.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the United States District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

December 3, 2009

Owner of Home Health Care Provider and Accomplice Arrested in Scheme to Bribe Government Contractor (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, announced the unsealing of a complaint and the arrest on Dec. 3, 2009 of Yosvany Collera, 37, of Miami, and Belkis Camara Marquez, 36, of Sunrise, in connection with a bribery scheme.

Collera and Marquez were arrested on a previously sealed criminal complaint charging them with corruptly bribing a public official to induce that person to do an act in violation of that person’s official duty, in violation of Title 18, United States Code, Section 201(b)(1). They had their initial appearances in federal court before U.S. Magistrate Judge Robin S. Rosenbaum in Fort Lauderdale. Pretrial detention hearings are scheduled for Tuesday, December 8, at 10:00 in Fort Lauderdale before U.S. Magistrate Judge Barry S. Seltzer.

According to an affidavit filed in the case, Collera is the owner and president of Lazaro Home Health Care, Inc., based in Miami. Lazaro Home Health Care had been a Medicare-certified home health services provider since 2005. From 2006 through August 2009, Lazaro Home Health Care submitted a total of approximately $10,467,300 in claims for reimbursement to Medicare for home health services purportedly provided to Medicare beneficiaries. Medicare paid a total of approximately $7,002,997 on those claims.

In August 2009, Safeguard Services LLC (“SGS”), a Program Safeguard Contractor with the Centers for Medicare and Medicaid Services (“CMS”) and the Zone Program Integrity Contractor for Florida, suspended Medicare payments to Lazaro Home Health Care and suspended its Medicare provider number. As the Zone Program Integrity Contractor, SGS works as part of the Medicare Integrity Program on behalf of CMS to address fraud, waste, and abuse by Medicare-certified health care providers. In this capacity, SGS suspended Lazaro Home Health Care following a determination that overpayments had been made, misrepresentations had occurred in claims submissions, and that certain other payments were not correct.

The affidavit also alleges that in October 2009, Camara, an acquaintance of Collera’s, contacted an SGS employee on behalf of Collera offering any amount of money to the SGS employee if the SGS employee would help Collera clear up his company’s problems.

In subsequent telephone conversations with Camara and Collera in November, the SGS employee, identified as a Cooperating Witness in an affidavit filed in the case, discussed Collera’s and Camara’s proposal with them. Collera allegedly told the SGS employee that Collera wanted his provider number back and told the employee that what Camara had offered was “100% guaranteed.”

On Friday, November 13, 2009, the SGS employee met with Collera and Camara at a bookstore in Sunrise. During the meeting, Collera again told the SGS employee that Collera wanted his Medicare provider number restored and the payment suspension lifted. Collera told the SGS employee that Collera would pay the SGS employee $5,000 to do this, half now and half upon completion. Collera also told the SGS employee that Collera had other people he could bring to the SGS employee. When Collera and the SGS employee exited the bookstore, Collera handed $2,500 in cash to the SGS employee. “This is a tremendous problem you’re going to take off of me,” Collera told the SGS employee. “I’ll be grateful my whole life.”

In another telephone conversation one week later, Collera told the SGS employee that Collera was ready to give the SGS employee the rest of the “medicine,” referring to the second $2,500 payment, when everything was done.

“We will continue to investigate and prosecute those who try to compromise the integrity of Medicare’s fraud prevention contractors,” said Acting United States Attorney Jeffrey H. Sloman, “just as aggressively as we do those whose fraud schemes deplete the Medicare Trust Fund.”

John V. Gillies, Special Agent in Charge of the Miami Office of the FBI stated, “This case shows the lengths criminals will go to commit health care fraud and how important it is to suspend Medicare payments as soon as possible. The FBI will continue to work with our partners to bring to justice those that are stealing U.S. taxpayers’ money and make medical care more expensive for all of us.”

Christopher Dennis, Special Agent in Charge of the Miami Division of HHS-OIG stated, “The diligent work of the Program Safeguard Contractors is but one of the fraud fighting mechanisms in place to protect the Medicare Trust Fund. We look forward to working with both our public and private-sector partners to fight health care fraud in all of its forms.”

This is the first prosecution in the Southern District of Florida involving attempted bribery of a Medicare Program Safeguard Contractor.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, Office of Inspector General, and thanked SGS and for its cooperation with the investigation. This case is being prosecuted by Assistant U.S. Attorney Christopher J. Hunter.

A Complaint is only an accusation and a defendant is presumed innocent unless and until proven guilty.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

December 1, 2009

Miami Man Arrested for Obstructing a Health Care Fraud Investigation (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, and Christopher Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, announced the unsealing of an Indictment and the arrest of Luis A. Baez, 38, of Miami, on Dec. 1, 2009. The Indictment unsealed today, but filed on November 12, 2009, charged Baez with obstruction of a health care fraud investigation in violation of Title 18, United States Code, Section 1518.

According to the Indictment, statements made in court, and documents filed in court, in January 2007, Baez told an FBI Special Agent who was conducting an investigation involving Med-Pro of Miami, Inc., that he had no knowledge of an entity known as the L. Baez Corporation or activities associated with the L. Baez Corporation. Baez knew this information was false. The Med-Pro investigation ultimately resulted in several indictments and convictions of various individuals for health care fraud and money laundering schemes involving millions of dollars in fraudulent reimbursement claims submitted to Medicare. According to documents filed in one of the Med-Pro cases, L. Baez corporation was used in connection with laundering proceeds of health care fraud.

At his initial appearance today, it was reported that Baez had been working at two local hospitals up until the time of his arrest. Baez’s bond was set at $50,000. As a condition of his bond, Baez is prohibited from working in the health care industry. Baez faces up to five years’ imprisonment and a fine of up to $250,000 if convicted.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, Office of Inspector General. This case is being prosecuted by Assistant U.S. Attorney Christopher J. Hunter.

An Indictment is only an accusation, and a defendant is presumed innocent unless and until proven guilty.
A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

November 13, 2009

Three Miami Residents Sentenced in Medicare Infusion Fraud (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, Daniel W. Auer, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division, and Sheriff Al Lamberti, Broward County Sheriff’s Office, announced that defendants Alejandro Gonzalez, Roberto Rodriguez, and Manuel Camacho, all of Miami, were sentenced for their participation in a Medicare fraud scheme.

Manuel Camacho was sentenced today to 18 months’ imprisonment, to be followed by two  years of supervised release.  Roberto Rodriguez was sentenced on November 3, 2009 to 102 months’ imprisonment, to be followed by 3 years of supervised release, and was ordered to pay restitution of $9,555,269.  Alejandro Gonzalez was sentenced on October 1, 2009 to 96 months’ imprisonment, to be followed by 3 years of supervised release, and was ordered to pay restitution of $11,935,761.76. 

Defendant Camacho previously pled guilty to one count of money laundering conspiracy, and defendants Rodriguez and Gonzalez pled guilty to one count of conspiracy to commit mail fraud.

According to documents filed with the court, between November 2003 and November 2006, defendants Gonzalez and Rodriguez established medical clinics in South Florida, purportedly to administer infusion therapies for the treatment of AIDS patients.  In fact, however, no treatments were rendered and patients received a kickback for signing-in at the clinic. In this way, the defendants billed Medicare for millions of dollars for treatments that were not rendered, and, in fact, were not medically necessary.  In sum, the defendants billed Medicare for approximately $40 million, of which Medicare paid about $12 million. 

Court documents reflect that defendant Camacho was recruited by his coconspirators to be the nominee owner of one of the clinics and was listed on the clinic’s bank accounts.  Camacho wrote checks and purchased boats and luxury automobiles as directed by Gonzalez and Rodriguez to launder the proceeds of the Medicare fraud.  He was involved in laundering more than $1 million on behalf of his co-defendants.

Mr. Sloman commended the investigative efforts of the Internal Revenue Service and the Broward Sheriff’s Office. The case is being prosecuted by Assistant U.S. Attorneys Roger H. Stefin and Thomas P. Lanigan.

October 31, 2009

Palmetto General Hospital Employee and Accomplice Sentenced for Stealing Patient Records in Fraud Scheme (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, Henry Gutierrez, Postal Inspector in Charge, U.S. Postal Inspection Service, and Robert L. Parker, Director, Miami-Dade Police Department, announced the Oct. 29, 2009 sentencing of defendants Jacquettia L. Brown, 29, and Tear Renee Barbary, 25, both residents of Miami-Dade County, following their conviction on offenses relating to the theft of patient records from Palmetto General Hospital to further a fraud scheme.

U.S. District Court Judge K. Michael Moore sentenced Brown to two years and five days of imprisonment, to be followed by three years of supervised release. Barbary was sentenced to eleven months of imprisonment, to be followed by three years of supervised release. Both Brown and Barbary were prohibited from working in the health care industry while on supervised release.

Brown and Barbary had previously been convicted of conspiracy to commit access device fraud, in violation of Title 18, United States Code, Section 1029(b)(2), and criminal violations of the Health Insurance Portability and Accountability Act of 1996 (HIPAA), Title 42, United States Code, Sections 1320d-6(a)(2), (a)(3), and (b)(3). In addition, Brown was convicted of aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1).

According to documents filed in the case and statements made in court, Brown stole patient profile records while she was working as a medical records employee of Palmetto General Hospital. The records contained individually identifiable health information of Palmetto General Hospital patients, including patients’ names, birthdates, addresses, Social Security numbers, diagnoses, and next of kin contacts, among other information.

Brown and Barbary then used the stolen personal information to further a credit card fraud conspiracy. Brown used the stolen identifying information to obtain patients’ credit card account numbers. She gave patient profile records and credit card account numbers to Barbary, who used the information to make unauthorized credit card purchases. When law enforcement officials disrupted the scheme in May 2009, Brown was in possession of 41 patient profile records and Barbary was in possession of six patient profile records. Brown admitted to stealing patient information from her employer since September 2008.

The confidentiality of patient information is strictly protected by HIPAA. HIPAA precludes the unauthorized release of information that is created or received by a health care provider and relates to the past, present, or future physical or mental condition of an individual, the provision of health care to the individual, or the past, present, or future payment for the provision of health care to an individual, and that either identifies the individual or includes information that could be used to identify the individual.

Mr. Sloman commended the efforts of agents and investigators from the Identity Theft and Economic Crimes Task Force, U.S. Postal Inspection Service, and the Miami Dade Police Department for their work on this case. Sloman also thanked Tenet Healthcare Corporation, parent company of Palmetto General Hospital, for its cooperation in the investigation of this matter. This case was prosecuted by Assistant U.S. Attorney Christopher J. Hunter.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on pacer.flsd.uscourts.gov.

October 29, 2009

Miami Doctor Sentenced on HIV-Infusion Fraud Scheme (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, and John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, announced that a Miami doctor was sentenced on Oct. 29, 2009 following his conviction for Medicare and Medicaid HIV-infusion fraud. Manuel Barbeite was sentenced to 78 months in prison, to be followed by three years of supervised release. In addition, Barbeite was ordered to pay $3,451,120.67 in restitution. Barbeite's co-defendant, Walter Proano, is scheduled to be sentenced on December 10, 2009.

Barbeite's conviction resulted from his involvement in a scheme to defraud the Medicare and Medicaid programs through his work at Diagnostic Medical Choice, a Southwest Miami clinic that billed these health care programs for expensive infusion medications intended to treat a rare illness suffered by a small portion of those afflicted with HIV/AIDS. To execute the scheme, Barbeite fabricated patient medical records and wrote prescriptions for large quantities of these medications. He then sought federal and state reimbursement for the medications, which had not been provided as claimed.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation's Health Care Fraud Squad and the Florida Attorney General's Medicaid Fraud Control Unit. This case was prosecuted by Special Assistant Attorney General Stephen A. LeClair.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on pacer.flsd.uscourts.gov.

October 23, 2009

Organizer of Medical Equipment Scam Sentenced to 57 Months in Prison (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, and John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Division, announced that defendant Maria F. Hernandez, 62, of Miami, Florida, was sentenced on Oct. 21, 2009 for her participation in a $5.7 million health care fraud scheme. U.S. District Judge Marcia Cooke sentenced Hernandez to a total of a 57 months' imprisonment. In addition, Hernandez was ordered to forfeit to the government a Miami townhouse that she purchased with fraud proceeds.

In August 2009, Hernandez pled guilty to an Information charging her with health care fraud conspiracy. The FBI investigation established that Hernandez conspired with others to defraud the Medicare program through the fraudulent submission of $5.7 million in durable medical equipment (DME) claims from 2005 through 2006. Hernandez used a relative’s medical billing company to submit the false claims. The claims concerned three separate DME companies that Hernandez and her co-conspirators controlled through straw owners in an effort to conceal their own interests. Medicare paid the Hernandez companies approximately $1.9 million based on the false claims, which were for DME items that were neither prescribed by doctors nor delivered to Medicare patients. In documents filed with the Court, Hernandez admitted to receiving upwards of $30,000 per month from her fraudulent ventures.

Acting U.S. Attorney Jeffrey H. Sloman commended the investigative efforts of the FBI. The case was prosecuted by Special Assistant U.S. Attorney William J. Parente, Jr.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on pacer.flsd.uscourts.gov

October 9, 2009

Jury Convicts Two Miami Men of $51 Million HIV-Infusion Fraud (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, Michael J. Folmar, Acting Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, Miami Regional Office, Daniel W. Auer, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division, and Amos Rojas, Jr., Special Agent in Charge, Florida Department of Law Enforcement, Miami Region, announced that on Friday, October 2, 2009, defendant Scarlet Duarte, of Miami, FL, was convicted of one count of conspiracy to launder money and five counts of money laundering and defendant Rechart Garcia, of Miami, FL, was convicted of one count of conspiracy to commit health care fraud, three counts of health care fraud, one count of conspiracy to pay health care kickbacks, one count of conspiracy to launder money, and five counts of money laundering.

According to the evidence presented at trial, the fraud involved purported treatment of HIV- positive Medicare beneficiaries at five clinics located in Miami-Dade County (Research Center of Florida, Inc., M & C Health Center, Corp., Project New Hope, Corp., L & R Medical Center, Corp., and L & B Health Center, Inc.), and a sixth clinic that operated in Collier and Lee Counties (RL & V Medical Services, Corp.). The conspirators paid Medicare beneficiaries to pretend to receive treatment at the clinics, and then billed Medicare for treatment that was never provided and would not have been medically necessary. In total, the six clinics submitted approximately $51.8 million in fraudulent claims, based on which Medicare paid them approximately $21.1 million. The conspirators obtained access to much of the Medicare payments by making payments to shell corporations (businesses that existed only on paper and provided no true services to the clinics), and to individuals who cashed checks from the clinics and returned the cash to the conspirators.

Duarte operated three of the shell corporations, which received a total of approximately $720,000 from five of the clinics. Duarte withdrew some of this money in cash and returned the cash to a conspirator involved in operating the clinics and used part of the money to pay businesses designated by the conspirators.

Garcia was the vice-president of L & R Medical Center and the sole officer of RL & V Medical Services, two clinics that jointly submitted more than $10 million in fraudulent Medicare claims. Garcia paid more than $400,000 to shell corporations controlled by the conspirators and to individuals who returned the money, in cash, to the conspirators.

Sentencing has been scheduled for December 14, 2009. Garcia faces a maximum sentence of ten (10) years' imprisonment on each count of conspiracy to commit health care fraud and health care fraud and five (5) years’ imprisonment on the count of conspiracy to pay health care kickbacks. Duarte and Garcia each face a maximum sentence of twenty (20) years’ imprisonment on each count of conspiracy to launder money and money laundering.

Fifteen (15) other defendants were previously convicted of, or are currently awaiting sentencing for, various fraud and money laundering charges related to the operation of the same six clinics. These defendants were prosecuted in this case and in United States v. Fernandez et al., Case No. 06-20322-CR-Altonaga, United States v. Tur, Case No. 09-20496, and United States v. Perez, Case No. 09-20528-CR-Gold.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation, the U.S. Department of Health and Human Services, Office of Inspector General, the Internal Revenue Service, and the Florida Department of Law Enforcement. This case is being prosecuted by Assistant U.S. Attorney Marc Osborne.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the United States District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

September 4, 2009

Former President and Owner of Complete Medical Center, Inc. Arrested on Health Care Fraud Charges (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting U.S. Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge for the FBI’s Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, announced the arrest today of defendant Alejandro Rodriguez, 53, of Miami-Dade County, and the unsealing of a seven-count Indictment charging Rodriguez with health care fraud, in violation of Title 18, United States Code, Section 1347.  Each count carries a maximum of ten years’ imprisonment.  A pre-trial detention hearing in this matter has been set for Wednesday, September 9, 2009, at 1:30 p.m., in front of U.S. Magistrate Chris M. McAliley.

According to the indictment, in February 2000, Rodriguez acquired Complete Medical Center, Inc., (“CMC”) a Miami-based company that purportedly provided durable medical equipment (“DME”) to Medicare beneficiaries.  Rodriguez obtained and maintained control of CMC by purchasing all of the shares of stock of CMC and by registering as the President, Vice-President, Secretary, Treasurer, Director, and Registered Agent of CMC with the State of Florida, Division of Corporations.  In April, 2000, Rodriguez notified Medicare that he was the new owner of CMC,  the only officer and director of CMC, and the authorized representative for CMC.  Later that month he opened up a business checking account for CMC, and was the sole signatory on that account.  

From the spring of 2000 through June 2008, CMC submitted approximately $3,570,502 in fraudulent claims to Medicare seeking reimbursement for DME items, such as oxygen concentrators, wheelchairs, and mattresses.  Rodriguez falsely represented that these DME items and other services were prescribed by a doctor and had been provided to Medicare beneficiaries.  As a result of such false and fraudulent claims, Rodriguez caused Medicare to make payments to CMC in the approximate amount of $1,590,265, at least $280,157 of which was deposited into CMC’s business checking account.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, Office of Inspector General.  This case is being prosecuted by Assistant U.S. Attorney Christopher J. Hunter.
An indictment is only a charge and is not evidence of guilt.  A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.

A copy of this press release may be found on the website of the U.S. Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

August 21, 2009

Former Owner of Atenas Medical Equipment, Inc. Arrested On Health Care Fraud Charges (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, Michael J. Folmar, Acting Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, announced the arrest on Aug. 21, 2009, of defendant Maria A. Aloise, 40, of Miami-Dade County, and the unsealing of an Indictment charging Aloise with health care fraud. FBI agents arrested Aloise this morning, and she had her initial appearance in federal court in Miami this afternoon. A detention hearing has been set for August 24, 2009.

On August 20, 2009, a federal grand jury in Miami returned an eleven-count Indictment charging Aloise with health care fraud, in violation of Title 18, United States Code, Section 1347. According to the Indictment, Aloise was the owner of Atenas Medical Equipment, Inc., a Hialeah-based company that purportedly provided durable medical equipment (“DME”) to Medicare beneficiaries. From June 8, 2005, through April 4, 2007, Atenas Medical Equipment is alleged to have submitted approximately $1,421,346 in fraudulent claims to Medicare seeking reimbursement for DME items, such as oxygen concentrators and hospital beds, that had not been prescribed by physicians nor provided to Medicare beneficiaries. If convicted, Aloise faces a maximum sentence of ten years’ imprisonment on each of the health care fraud counts.

An indictment is only an accusation is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt. Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, Office of Inspector General. This case is being prosecuted by Assistant U.S. Attorney Christopher J. Hunter.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

August 17, 2009

Two Miami Doctors Convicted Of Medicare, Medicaid Fraud (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, and Bill McCollum, Florida Attorney General, announced that two Miami doctors have been convicted of Medicare and Medicaid fraud. A Miami jury returned guilty verdicts against Walter Proano and Manuel Barbeite on Aug. 17, 2009. Sentencing has been scheduled before U.S. District Judge Patricia A. Seitz for October 29, 2009, starting at 8:30 a.m.

Proano and Barbeite were convicted for their involvement in a scheme with Diagnostic Medical Choice, a Southwest Miami clinic that billed the Medicaid and Medicare programs for expensive infusion medications intended to treat a rare illness suffered by a small portion of those inflicted with HIV/AIDS. The physicians wrote prescriptions for large quantities of these medications and sought federal and state reimbursement, but the clinic had little if any of the medications in stock and rarely if ever provided infusions to patients.

Proano was found guilty of one count each of health care fraud and conspiracy to commit health care fraud. He faces a maximum sentence of 15 years in prison. Barbeite was convicted of two counts of health care fraud and one count of conspiracy to commit health care fraud. He faces a maximum sentence of 20 years in prison.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation's Health Care Fraud Squad and the Florida Attorney General's Medicaid Fraud Control Unit. This case is being prosecuted by Special Assistant U.S. Attorney Stephen A. LeClair.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the United States District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or http://pacer.flsd.uscourts.gov.

August 17, 2009

Durable Medical Equipment Company Owner Convicted In Medicare Fraud Scheme (U.S. Attorney For The Southern District Of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, Michael J. Folmar, Acting Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, announced that defendant Adonis Ortiz, of Miami, was found guilty on Thursday, August 13, 2009, of health care fraud and conspiracy to commit health care fraud, in violation of United States Code, Sections 1347 and 1349, respectively. Sentencing is scheduled before U.S. District Court Judge Adalberto Jordan on October 30, 2009. Defendant Ortiz faces a maximum term of imprisonment of forty years.

According to the Indictment and evidence admitted at trial, defendant Ortiz controlled and operated Daky Medical Supply, Corp. (“Daky Medical”), located in Miami, FL. Daky Medical purportedly provided durable medical equipment to Medicare beneficiaries. From April 2003 through March 2004, Ortiz was the President, Vice President, Secretary, Treasurer, and Registered Agent of Daky Medical, and caused the submission of $6,180,030 in false claims to Medicare for DME items and services that were not prescribed by doctors or provided as claimed. For example, seven doctors whose names appeared on various prescriptions and billing records submitted to Medicare testified that they had not provided or signed the prescriptions. In addition, many of the fraudulent claims submitted by Daky Medical involved persons who had died before the date of the alleged service.

Evidence admitted at trial also revealed defendant Ortiz’s ownership role in a second durable medical equipment company, Reny Medical Equipment & Supply Inc. ( “Reny Medical”), also located in Miami. From February 2004 through July 2004, defendant Ortiz caused Reny to submit approximately $6,944,980 in fraudulent claims to Medicare for DME items and services that were not prescribed by doctors or provided as claimed. Medicare paid Reny Medical approximately $2,796,316 on these claims.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation, and the U.S. Department of Health and Human Services, Office of Inspector General. This case is being prosecuted by Assistant United States Attorney Christopher J. Clark.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the United States District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or http://pacer.flsd.uscourts.gov.

August 10, 2009

Miami Prescription Drug Wholesaler Convicted (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, and David W. Bourne, Special Agent in Charge, U.S. Food and Drug Administration (FDA), Office of Criminal Investigations, Miami Field Office, announced that after a two week trial before U.S. District Judge Alan S. Gold, a jury convicted Arnesto Segredo, 43, of Miami, of conspiring to divert the prescription drugs Serostim and Nutropin AQ, both human growth hormones, and one count of causing the diversion of these human growth hormones, in interstate commerce. Sentencing is scheduled for October 23, 2009 at 4:00 p.m.

According to the evidence presented at trial, Segredo caused California-based human growth hormone suppliers, all of which were unlicensed to engage in the wholesale distribution of prescription drugs in California, to regularly ship to him in Miami hundreds of boxes of Serostim, and some Nutropin AQ, from 2000 through the end of 2002. Serostim is an injectable drug approved by the FDA for the treatment of AIDS-wasting syndrome in HIV-infected patients, and Nutropin AQ is an injectable drug approved by the FDA for the treatment of growth hormone deficiency, including children with short stature.

From 2000 through 2001, Segredo operated Life Extension Institute, a Miami-based prescription drug wholesaler, which was also not licensed to engage in the distribution of prescription drugs in Florida. He later operated through Genendo Purchasing Organization, a Miami-based prescription drug wholesaler that became licensed in Florida in July 2001. A significant portion of the Serostim that Segredo distributed through these two companies originated from California-based AIDS patients who sold their Serostim supplies secured from the Medi-Cal Medicaid program.

Mr. Sloman commended the investigative efforts of the FDA’s Office of Criminal Investigations. The case was prosecuted by Assistant U.S. Attorney Jose A. Bonau of the Economic and Environmental Crimes Section, and Special Assistant U.S. Attorney Michael Varrone, a Trial Attorney with the FDA’s Office of Chief Counsel.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

August 10, 2009

Owner of Hialeah Health Care Facilities Charged With Making Threats to Medicare Employees (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, Michael J. Folmar, Acting Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of the Inspector General, Miami Regional Office, announced that defendant Yamill Ramos Perez, of Miami-Dade County, was indicted on charges of threatening to injure a Medicare Fraud Investigator and a Director of the Centers for Medicare and Medicaid Services. He was arrested on Friday, August 7, 2009. The arraignment and detention hearing are scheduled for Thursday, August 13, 2009, at 10 AM before the duty Magistrate Judge.

The Indictment, dated August 6, 2009, alleges that Ramos owned, through intermediaries, two health care clinics: El Palenque Farmacia Corp., and Meli Pharmacy, both located in Hialeah, Florida. The clinics allegedly billed Medicare for approximately $20,000,000, and Medicare reimbursed the clinics for approximately $6,000,000. The two clinics were then placed on “pre-payment review” because of suspected fraud. The “pre-payment review” status is designed to prevent clinics that fraudulently bill Medicare from receiving additional reimbursements.

According to the Indictment, beginning in January 2009, Ramos repeatedly contacted Medicare requesting the removal of the pre-payment review. Specifically, Ramos sent numerous facsimiles accusing Medicare of ruining lives. In one facsimile, Ramos stated, “Let us return the favor by ruining theirs.”

On January 16, 2009, Ramos is alleged to have threatened a Medicare Fraud Investigator in Indiana. On July 9, 2009, Ramos is alleged to have threatened a Director of the Centers for Medicare and Medicaid Services in Maryland. The Indictment alleges that Ramos caused substantial emotional distress to the two victims and placed them in a reasonable fear of serious bodily injury, in violation of Title 18, United States Code, Sections 2261A(2) and 875(c).

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation and the U.S. Department of Health and Human Services, Office of Inspector General. This case is being prosecuted by Assistant U.S. Attorney H. Ron Davidson.

An indictment is only an accusation and is not evidence of guilt. A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt. A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov/ or on http://pacer.flsd.uscourts.gov.

August 10, 2009

Hialeah Man Convicted of Conspiracy to Commit Health Care Fraud and Obstruction of Justice (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, and Michael J. Folmar, Acting Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, announced that on Friday, August 7, 2009, a federal jury in Miami convicted defendant Ramon Santos, of Hialeah, FL, of conspiracy to commit health care fraud, health care fraud and obstruction of justice following a trial before Senior U.S. District Judge James Lawrence King. Sentencing has been scheduled for October 29, 2009. Santos faces a statutory maximum penalty of 10 years’ imprisonment. More specifically, the jury convicted Santos of two counts of conspiracy to commit health care fraud, in violation of Title 18, United States Code, Section 1349; five counts of health care fraud, in violation of Title 18, United States Code, Section 1347; and one count of obstruction of justice, in violation of Title 18, United States Code, Section 1503. According to evidence presented at trial, Santos was employed by two separate HIV-infusion clinics, The Better Health Consulting Clinic and Mitto Health Center Inc, which purportedly provided infusion treatments to HIV-positive Medicare beneficiaries. From 2004 through June 2006, both Mitto and Better Health submitted claims to Medicare in which they claimed that they were providing expensive HIV-infusion therapies when, in fact, they were providing the patients with nothing more than injections or infusions of Vitamins B-6 and B-12. During the course of the conspiracy, the two clinics submitted more than $12 million in false claims to Medicare. According to the trial evidence, defendant Santos, who was not a licensed physician’s assistant, purported to be a physician’s assistant and examined patients, prepared treatment plans, and prepared false medical paperwork, which paperwork was ultimately used to submit false claims to Medicare. In addition, after Better Health received a grand jury subpoena in June of 2006, Santos created false medical records and placed phony test results inside patient files which were ultimately returned to the grand jury. Mr. Sloman commended the investigative efforts of the FBI. This case was prosecuted by Assistant U.S. Attorneys Daniel Bernstein and Ryan O’Quinn. A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov/ or on http://pacer.flsd.uscourts.gov.

August 7, 2009

Federal Judge Sentences Defendants Who Perpetrated $10.9 Million Medicare Fraud Hiv Infusion Scheme (U.S. Attorney for the Southern District of Florida)

Miami physician Keith Russell, 65, and physician’s assistant Jorge Luis Pacheco, 50, were each sentenced to 97 months in prison, and physician’s assistant Eda Marietta Milanes, 43, was sentenced to 63 months in prison, for their roles in fraud schemes that involved billing Medicare for $10,903,509 worth of unnecessary HIV infusion treatments, Acting U.S. Attorney Jeffrey H. Sloman of the Southern District of Florida; Assistant Attorney General Lanny A. Breuer of the Criminal Division; and Daniel R. Levinson, Inspector General of the Department of Health & Human Services (HHS) announced today.

Russell, Pacheco and Milanes were also ordered to pay more than $3.1 million in restitution to the Medicare program during their sentencing hearings before U.S. District Judge Ursula Ungaro.

Russell, Pacheco and Milanes were convicted by a jury of conspiracy to commit health care fraud and multiple counts of health care fraud on March 17, 2009, after a two-week trial in Miami.

“Medical professionals serve as the gatekeepers of the Medicare system, and their single most important duty is to determine the best care for their patients,” said Assistant Attorney General Lanny A. Breuer of the Criminal Division. “Physicians and their assistants who choose instead to abuse the public trust and enrich themselves by gaming Medicare will be vigorously prosecuted, and we will continue to expand our strike force operations to stamp out this kind of blatant fraud.”

“The infusion clinic in this case was established for the sole purpose of defrauding Medicare – these doctors saw no patients, administered no legitimate medical services, and paid a cash kickback to patients for each visit,” said Acting U.S. Attorney Jeffrey H. Sloman of the Southern District of Florida. “In this way, the defendants bilked Medicare out of millions of dollars in false claims. The U.S. Attorney’s Office in South Florida is committed to prosecuting these frauds, in the hopes of helping to restore the integrity of our health care system.”

“This case illustrates the profound consequences to the Medicare program and its beneficiaries when trusted health care professionals conspire to defraud the program by participating in sham medical operations,” said HHS Inspector General Daniel R. Levinson. “Our agents are working tirelessly with our Strike Force partners to investigate these spurious operations, bring perpetrators to justice, and recover stolen funds for the Medicare program.”

Trial evidence established that Russell, Pacheco and Milanes served as the medical staff for M&P Group of South Florida Inc. (M&P Group) and Tendercare Medical Center Inc. (Tendercare), which purported to specialize in the treatment of Human Immunodeficiency Virus (HIV).

Russell was the medical director for both M&P Group and Tendercare during their operations. Pacheco and Milanes worked as medical assistants for Russell at both clinics. One of the owners of the clinics, Tony Marrero, testified at trial that the clinics were established for the sole purpose of defrauding Medicare. Marrero testified that the scheme was to submit claims for medically unnecessary HIV infusion and injection treatments.

Evidence at trial showed that the conspirators billed Medicare for $10,903,509 and were paid in excess of $3.1 during approximately two years of operations. Trial witnesses testified that the unnecessary medicines were not administered, and that the clinics were only operated to create the appearance of legitimacy. Marrero stated that he had an arrangement with a pharmaceutical wholesale company, Lifecare Medical, to buy invoices showing the purchase of large amounts of medications, when only minor amounts were actually bought.

Marrero also testified that he paid Milanes and the M&P group extra money to manipulate patients’ blood samples so the lab results would appear to support the fraudulent claims. Another physician’s assistant, Luz Borrego, testified how those samples were manipulated, and Borrego also stated that she would not give the medications because she knew the medications could hurt HIV patients if actually provided.

Trial testimony established that every patient who went to the clinics was paid a cash kickback of up to $200 per visit. Four patients testified at trial that they took bribes and never received medication at the clinics. One patient testified that he used his payments from the clinics to support his cocaine addiction. Another patient testified that he did not even have HIV, notwithstanding clinic documents showing he was being infused with medication to treat HIV.

Trial evidence established that Russell, Pacheco and Milanes worked at Tendercare and M&P Group at the same time. Further, patients testified at trial that they would received cash and bogus treatments from both clinics.

At sentencing, Milanes acknowledged that she was paid extra by Marrero to manipulate blood samples to justify the false claims. Marrero testified that Pacheco worked directly for him to determine what drugs would be falsely billed to Medicare.

On March 14, 2009, prior to the jury verdict and while trial was ongoing, Pacheco attempted to flee the United States, according to evidence presented in court. He was apprehended heading south on Krome Ave. in Miami-Dade County with $12,600 in cash and a false Florida driver’s license in the name of Jose Luis Falcon. Evidence presented to the court proved that prior to his apprehension, Pacheco cut off his ankle monitor in violation of the terms of his pre-trial release. Documents seized from Pacheco at the time of his apprehension contained multiple contacts in the Dominican Republic. According to evidence presented at court, Pacheco stated to officers that he was “going fishing.” Pacheco was a licensed physician in Cuba before coming to the United States.

This case was investigated by the Department of Health and Human Services, Office of Inspector General, Office of Investigations (HHS-OIG) and the FBI . The work of the Homestead, Fla., Police Department was instrumental in the apprehension of Pacheco when he attempted to flee during trial.

The case was tried by Kirk Ogrosky, John S. (Jay) Darden and Charles D. Reed of the Criminal Division’s Fraud Section, with the investigative assistance of HHS-OIG and the FBI. The case was brought as part of the Medicare Fraud Strike Force (MFSF), supervised by the Criminal Division’s Fraud Section and Acting U.S. Attorney Sloman of the Southern District of Florida.

Since the inception of Strike Force operations in March 2007 – Miami (Phase One), Los Angeles (Phase Two), Detroit (Phase Three), and Houston (Phase Four) – the Strike Force has obtained indictments of more than 293 individuals and organizations that collectively have billed the Medicare program for more than $680 million. In addition, HHS’s 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.

Each of the Strike Force teams across the separate phases are led by a federal prosecutor from the Criminal Division’s Fraud Section or the U.S. Attorney’s Office. Each team has an agent from the FBI and HHS-OIG.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

July 31, 2009

Three Miami Residents Plead Guilty In Medicare Infusion Fraud (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting U.S. Attorney for the Southern District of Florida, Sheriff Al Lamberti, Broward County Sheriff’s Office, Daniel W. Auer, Special Agent in Charge, Internal Revenue Service, Criminal Investigation, and Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services- Office of Inspector General (HHS-OIG), announced on July 31, 2009, that defendants Alejandro Gonzalez, Robert Rodriguez, and Manuel Camacho, all of Miami, all pled guilty for their participation in a medicare fraud scheme.  Alejandro Gonzalez pled guilty on July 9, 2009, Robert Rodriguez pled guilty on July 10, 2009, and Manuel Camacho pled guilty on July 30, 2009.

According to documents filed with the court, between November 2003 and November 2006, defendants Gonzalez and Rodriguez established medical clinics in South Florida, purportedly to administer infusion therapies for the treatment of AIDS patients.  In fact, however, no treatments were rendered and patients received a kickback for signing-in at the clinic.  In this way, the defendants billed Medicare for millions of dollars for treatments that were not rendered, and, in fact, were not medically necessary.  In sum, the defendants billed Medicare for approximately $40 million, of which Medicare paid about $12 million.

More specifically, defendants Gonzalez and Rodriguez pled guilty to one count of conspiracy to commit mail fraud, and defendant Camacho pled guilty to one count of money laundering conspiracy.  The defendants, who face up to 20 years’ imprisonment, are scheduled to be sentenced in the fall.  Alejandro Gonzalez is scheduled to be sentenced on November 25, 2009 at 10:00 a.m.; Robert Rodriguez is scheduled to be sentenced on September 18, 2009 at 11:00 a.m.; and Manuel Camacho is scheduled to be sentenced on October 8, 2009 at 10:30 a.m.

Mr. Sloman commended the investigative efforts of the Broward Sheriff’s Office, Internal Revenue Service, the HHS-OIG.  The case is being prosecuted by Assistant U.S. Attorneys Roger H. Stefin and Thomas P. Lanigan.

Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov/ or on http://pacer.flsd.uscourts.gov/. 

A copy of this press release may be found on the website of the United States Attorney's Office for the District of Florida at:
http://www.usdoj.gov/usao/fls/PressReleases/090731-04.html

July 31, 2009

Defendant Charged In Scheme to Steal Patient Information (U.S. Attorney for the Southern District of Florida)

On July 31, 2009, Jeffrey H. Sloman, Acting U.S. Attorney for the Southern District of Florida, and Michael J. Folmar, Acting Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, announced the July 23, 2009, indictment of Ruben Rodriguez, who is alleged to have conspired to steal patient information from Jackson Memorial Hospital (JMH) and sell the information to at least one attorney practicing in South Florida.  Mr. Rodriguez made his initial appearance in federal court on July 30^th.   He was released on a $200,000 personal surety bond.

According to the six-count indictment, Mr. Rodriguez solicited the assistance of Rebecca Garcia, a then employee of JMH working as an ultrasound technician in the Abdominal and Vascular Ultrasound Department.  Mr. Rodriguez specifically brokered a deal whereby Ms. Garcia would illegally access, obtain, and transfer certain JMH patient information to him in return for monthly payments.  Once in receipt of this information, Mr. Rodriguez would, in turn, pass it along to an attorney, who would use the personal identification information to improperly solicit the JMH patients - with hopes of representing them in future legal proceedings.  Mr. Rodriguez was paid by the attorney to provide this information, and his ill-gotten proceeds were dictated, in part, by resulting lawsuits and/or settlements.

If convicted, Mr. Rodriguez faces a maximum of five years’ imprisonment for both conspiracy and fraud in connection with computers, and 10 years’ imprisonment for the wrongful disclosure of individually identifiable health information. He also faces a mandatory consecutive term - to any other potential conviction - of two years’ imprisonment on the aggravated identity theft offenses.   

Ms. Garcia, who already has plead guilty to a one-count information charging wrongful disclosure of individually identifiable health information, likewise faces a maximum of 10 years’ imprisonment.

Mr. Sloman commended the investigative efforts of the Federal Bureau of Investigation.  This case is being prosecuted by Assistant U.S. Attorney Benton Curtis.

An indictment is only a charge and is not evidence of guilty.  A defendant is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.

Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov/ or on http://pacer.flsd.uscourts.gov/. 

A copy of this press release may be found on the website of the United States Attorney's Office for the District of Florida at:
http://www.usdoj.gov/usao/fls/PressReleases/090731-01.html

July 31, 2009

Organizer of Health Care Fraud and Insurance Fraud Ring Sentenced To Prison (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting U.S. Attorney for the Southern District of Florida, Daniel W. Auer, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division, and Alex Sink, Chief Financial Officer, Florida Department of Financial Services, announced on July 24, 2009, that defendant Mike Williams Tosca Martinez was sentenced today to 168 months' imprisonment, to be followed by 3 years of supervised release. In addition, the Court ordered the forfeiture of $3,428,851. Martinez had previously pled guilty in Fort Lauderdale federal court to conspiracy to commit health care fraud, in violation of Title 18, United States Code, Section 1349 (Count 1), money laundering, in violation of Title 18, United States Code, Section 1957(a) (Count 20), and fraudulent use of another person's social security number, in violation of Title 42, United States Code, Section 408(a)(7)(B) (Count 43).

According to documents filed with the court, Martinez, co-defendants Nhon Nguyen, Jacqueline Gonzalez (a chiropractor), and two other chiropractors, Danielle Morse and Christina Lapp, created a scheme to defraud while running the No More Pain Center, Inc., United Chiropractic Center of Florida, Inc., Broward Care Medical Center, Inc., Broward Care Chiropractic Center, Inc., North Miami Beach Health Center, Inc., Spine Relief Center, and Miramar Spine Relief Center. To execute the scheme, the defendants solicited real victims of automobile accidents and individuals participating in "staged" accidents to visit their chiropractic clinics and seek treatments that were not medically necessary. In this way, the defendants filed fraudulent insurance claims for non-existent and inflated personal injuries on behalf of the participants. In total, the defendants submitted false claims to insurance companies that resulted in payments of more than $3 million.

Previously, Nguyen pled guilty to conspiracy to commit health care fraud and money laundering, and was sentenced to 30 months in prison. Gonzalez pled guilty to obstruction of a criminal investigation of health care offenses and making false statements to agents, and was sentenced to 15 months in prison. Chiropractors Danielle Morse and Christina Lapp pled guilty to obstruction of a criminal investigation of health care offenses and making false statements to agents; they are scheduled to be sentenced on August 11th and 12th, respectively. They face maximum sentences of 5 years for each count.

Mr. Sloman commended the investigative efforts of the IRS-CID, the Florida Department of Financial Services-Division of Insurance Fraud, and the National Insurance Crime Bureau for investigating this case. The case was prosecuted by Assistant U.S. Attorney Harry C. Wallace, Jr.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls/PressReleases/090724-02.html. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

June 23, 2009

Eight Miami Residents Charged In Five-State $100 Million Medicare and Medicare Advantage Fraud Scheme (U.S. Attorney for the Southern District of Florida)

Jeffrey H. Sloman, Acting United States Attorney for the Southern District of Florida, Jonathan I. Solomon, Special Agent in Charge, Federal Bureau of Investigation, Miami Field Office, Daniel W. Auer, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division, and Al Lamberti, Broward County Sheriff, announced that defendants Michel De Jesus Huarte, 38, Ramon Fonseca, 45,Vicente Gonzalez, 38, Alyd Dazza, 45, Monika Blacio, 41, Ricco Dazza, 41, Orlin Tamayo Quinonez, 35, and Juan Carralero, 56, all residents of Miami, FL, were indicted on June 18, 2009, on Medicare and other fraud-related charges.

More specifically, defendants Vicente Gonzalez, Alyd Dazza, Rico Dazza, and Monika Blacio were charged with conspiracy to commit Medicare fraud and/or conspiracy to commit money laundering. They are scheduled to be arraigned today at 1:30 PM before Magistrate Judge Patrick White. Two other defendants, Michel De Jesus Huarte and Ramon Fonseca, were arraigned yesterday on charges of conspiracy to commit Medicare fraud, Medicare fraud, conspiracy to commit money laundering, money laundering, and aggravated identity theft. Defendants Orlin Tamayo Quinonez and Juan Carralero, both charged with conspiracy to commit Medicare fraud, have not yet been arrested and remain at large. The Indictment also seeks the forfeiture of the fraud proceeds.

The 20-count Indictment charges two separate Medicare fraud conspiracies. The first conspiracy charges that defendant Michel De Jesus Huarte and unindicted conspirators controlled and operated six purported medical clinics in Miami-Dade County: Zigma Medical Care, Inc.; Tender Loving Care Medical Center, Inc.; Professional Medical Health, Inc.; Metro Med Care, Inc.; San Diego Medical & Rehab Center, Inc.; and Eulogia's Diagnostic Medical Center, Inc. According to the Indictment, these clinics submitted at least $50.2 million in false claims to Medicare for infusion therapy, injection therapy, and other expensive medical treatments designed to treat patients suffering from, among other illnesses, cancer, HIV, AIDS, chronic pain, and varicose veins. Infusion therapy medications are administered by insertion of a needle into a patient's vein.

As a result of these fraudulent infusion claims, Medicare paid Huarte and his conspirators at least $19.2 million. To conceal his involvement in this scheme, Huarte and his conspirators recruited nominee owners for each company, and paid them large sums of cash to sign the corporate records, bank records, and other business documents. One such nominee owner, Madelin Machado of Zigma Medical, was indicted in the Southern District of Florida in January 2008 (Case No. 08-20033-HUCK), and remains a fugitive.

The second Medicare fraud conspiracy charges defendants Michel De Jesus Huarte, Ramon Fonseca, Vicente Gonzalez, Monika Blacio, Ricco Dazza, Orlin Tamayo Quinonez, and Juan Carralero in a five-state Medicare Advantage fraud scheme. This conspiracy charge alleges that Huarte and Fonseca controlled and operated eight (8) medical clinics purportedly operating in Florida, Georgia, Louisiana, North Carolina, and South Carolina. These companies are alleged to have collectively submitted at least $19.8 million in false claims to various private insurance companies that offered coverage to Medicare beneficiaries through Medicare Advantage programs.

The Medicare Advantage Program, formerly known as “Part C” or “Medicare+Choice,” provides Medicare beneficiaries with the option of receiving their Medicare benefits through private managed care plans, including health maintenance organizations (HMOs), provider sponsored organizations (PSOs), preferred provider organizations (PPOs), and private fee-for-service plans (PFFs), rather than through traditional Medicare (Parts A and B). Based on the false claims received, these companies paid the defendants approximately $4.6 million. Once again, a substantial portion of the fraudulent billings were for expensive cancer and HIV infusion medications.

The Indictment further alleges that defendants Vicente Gonzalez and others formed and managed the two purported clinics in New Orleans: Fast Cure and Best Cure. Defendants Monika Blacio, Ricco Dazza, and Orlin Tamayo Quinonez allegedly formed and managed Ziallet Services, Inc. in North Carolina, and Magestic Group Services, Inc., in South Carolina. Juan Carralero allegedly served as the titular owner of two Georgia clinics, Comprehensive Medicare Care Services, Inc. and Best Care Solutions Corp., and helped manage and operate both companies.

The Indictment alleges that Huarte and Fonseca deposited fraud proceeds from their clinics at two Miami-area check cashing stores, Universal MoneyFast and Rapid Trans Solutions. These check cashing stores were owned by defendants Alyd Dazza and Monika Blacio, respectively. Defendants Alyd Dazza and Blacio would accept delivery of Medicare Advantage insurance company checks from Huarte and Fonseca as often as three to four times per week. Thereafter, Dazza and Blacio would deposit the checks into the corporate bank accounts for their respective check cashing stores, wait for the checks to clear, and then deliver the cash to Huarte and/or Fonseca. The typical cash deliveries ranged from between $30,000 and $80,000 multiple times per week. This conduct resulted in the money laundering conspiracy charges against defendants Huarte, Fonseca, Gonzalez, Blacio, and Dazza.

Acting U.S. Attorney Jeffrey H. Sloman stated, “With new Medicare fraud cases being indicted in the Southern District of Florida every week, it is easy to become numb to otherwise egregious fraudulent conduct and staggering loss amounts. This case is remarkable, not only in terms of the amounts stolen from Medicare, but also in terms of its sophistication and geographic breadth. These defendants attempted to steal approximately $100 million from the elderly, blind and disabled by using multiple store-front clinics in five different states and then laundered their profits through local check cashing stores. The U.S. Attorney’s Office will continue to devote significant prosecutorial resources to aggressively eliminate these abuses, and to send the perpetrators to jail.”

“The FBI and its partners will continue to investigate those who steal from taxpayers by committing health care fraud. We are confident that law enforcement, combined with preventive measures, can make a difference in substantially reducing health care fraud,” said Jonathan I. Solomon, Special Agent in Charge of the Miami Office of the FBI.

“The IRS plays a critical role in the investigation of financial crimes cases by providing the financial expertise to follow the money trail and helping to seize the profits of illegal activities. This case is another example of the successes that occur when federal and local law enforcement combine resources,” said Daniel W. Auer, Special Agent in Charge of the IRS-Criminal Investigation Division.

Broward Sheriff Al Lamberti stated, “Cases such as this are the reason behind the creation of the Broward County Money Laundering Task Force. I commend everyone involved for successfully navigating such a complex, multi-agency investigation.”

If convicted, the defendants face a possible maximum statutory sentence of 10 years’ imprisonment on each count of conspiracy to commit health care fraud and each count of substantive health care fraud, 10 years’ imprisonment on each count of conspiracy to commit money laundering and substantive money laundering, and 2 years’ imprisonment on each count of aggravated identity theft.

Mr. Sloman commended the cooperative investigative efforts of the Federal Bureau of Investigation, the Internal Revenue Service, and the Broward County Sheriff’s Office. This case is being prosecuted by Assistant U.S. Attorney Ryan Stumphauzer.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls/PressReleases/090623-01.html. Related court documents and information may be found on the website of the United States District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

March 26, 2009

Miami Doctor and Chemist Plead Guilty in HIV Infusion Fraud Scheme (U.S. Attorney for the Southern District of Florida)

Two Miami-area residents pleaded guilty today in connection with a $10 million Medicare fraud scheme involving HIV infusion clinics, Acting Assistant Attorney General Rita M. Glavin of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida announced.

Dr. Carmen Del Cueto, 65, and Alexis Dagnesses, 44, each pleaded guilty to one count of conspiracy to commit health care fraud before U.S. District Judge Paul C. Huck. Both defendants admitted to working at Midway Medical Center Inc. (Midway), a Miami clinic that purported to specialize in the treatment of patients with HIV.

According to plea documents, Del Cueto was a co-owner of and practicing physician at Midway. Del Cueto and her co-conspirators billed Medicare routinely for services that were medically unnecessary and, in many instances, never provided. Del Cueto admitted to purchasing only a small fraction of the medication that was purportedly being administered to Midway's patients.

Most of the services allegedly provided to patients at Midway were billed to the Medicare program as treatments for a diagnosis of thrombocytopenia, a disorder involving a low count of platelets in the blood. According to court documents, none of Midway's patients actually had low blood platelet counts. To make it appear that the patients actually had low platelet levels, Del Cueto admitted that she and her co-conspirators used chemists, including Dagnesses, to manipulate the blood samples drawn from Midway's patients before the blood was sent to a laboratory for analysis. In her plea, Del Cueto admitted to ordering that patients at Midway receive medications to treat thrombocytopenia despite knowing that the laboratory results had been falsified and the patients did not actually have any such condition.

Midway was not the only clinic where Del Cueto purported to treat HIV patients with injection and infusion therapies. In her plea, Del Cueto admitted that she engaged in substantially similar fraudulent conduct at Diagnostic Medical Center Inc. (Diagnostic), another Miami-area infusion clinic. At Diagnostic, Del Cueto admitted that she and her co-conspirators also billed the Medicare program for HIV injection and infusion services that she knew were medically unnecessary and, in some instances, never actually provided. At the two clinics, Del Cueto admitted to causing the submission of approximately $9.5 million in fraudulent claims to Medicare.

Dagnesses admitted that he would obtain vials of blood drawn from Midway's patients and place those vials in a blood centrifuge. After rotating the blood in the centrifuge for approximately 15 minutes, the blood would separate into its component parts, enabling Dagnesses to extract the platelets from the sample. Dagnesses would then return the adulterated blood to his co-conspirators at Midway, who would send it to a laboratory for testing. Dagnesses admitted that he was generally usually paid $1,000 for every vial of blood that he tainted for his co-conspirators at Midway. Dagnesses admitted he was aware that the purpose of tainting the blood was to obtain false laboratory reports for Midway's medical files, which would make it appear that the medications allegedly provided at Midway were medically necessary, when in fact they were not necessary.

The case is being prosecuted by Trial Attorneys John K. Neal and Anthony Burba of the Criminal Division's Fraud Section. The case is being investigated by the FBI and the Department of Health and Human Services-Office of Inspector General. The case was brought as part of the Medicare Fraud Strike Force, supervised by Deputy Chief Kirk Ogrosky of the Criminal Division's Fraud Section and U.S. Attorney Acosta of the Southern District of Florida. Since the inception of MFSF operations, federal prosecutors have indicted 106 cases with 196 defendants in Miami and Los Angeles. Collectively, these defendants fraudulently billed the Medicare program for more than $577 million.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at http://www.usdoj.gov/usao/fls. Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.

A copy of this press release may be found on the website of the United States Attorney's Office for the Southern District of Florida at: http://www.usdoj.gov/usao/fls/PressReleases/090325-02.html

February 13, 2009

Three Miami Physicians and Three Medical Workers Charged with $10 Million Medicare Fraud Scheme (U.S. Attorney for the Southern District of Florida)

WASHINGTON – Six Miami-Dade County residents have been indicted in connection with an alleged $10 million Medicare fraud scheme operated out of Midway Medical, a Miami clinic that purported to specialize in treating HIV/AIDS patients, Acting Assistant Attorney General Rita M. Glavin of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida announced.

Carmen Lourdes del Cueto, M.D., 65, Roberto Rodriguez, M.D., 54, Carlos Garrido, M.D., 69, Gonzalo Nodarse, 38, Alexis Carrazana, 41, and Alexis Dagnesses, 44, were all indicted by a grand jury in Miami on Feb. 12, 2009, for conspiracy to commit health care fraud. Del Cueto, Rodriguez, Garrido and Nodarse were also charged with conspiracy to launder health care fraud proceeds, as well as three counts each of substantive money laundering. The indictment seeks the forfeiture of assets from all named defendants.

According to the indictment, the three physicians, del Cueto, Rodriguez and Garrido, were part-owners of Midway Medical. Midway Medical purported to be an infusion clinic that specialized in providing infusions and injections to HIV-positive patients. The indictment alleges that the physicians ordered medically unnecessary infusions and injections, and falsified medical records to make it appear that the HIV services were necessary. The indictment also alleges that many of the infusions or injections were never actually provided.

The indictment also alleges that medical assistants Nodarse and Carrazana assisted the physicians in falsifying the medical records to make it appear that the services were needed. As part of the scheme, Dagnesses is alleged to have manipulated HIV-positive blood samples in order to obtain laboratory reports indicating that the patients had illnesses that they in fact did not have.

Del Cueto, Rodriguez, Garrido and Nodarse are further charged with distributing the proceeds of the fraud through a series of financial transactions involving more that $10,000 in tainted funds.

The indictment alleges that the physicians at Midway Medical billed more than $10 million to the Medicare program for services that were medically unnecessary and not actually provided between September 2002 and June 2005. During that time frame, Medicare paid more than $4.8 million on those fraudulent claims submitted by Midway Medical. If convicted on all charges, Del Cueto, Rodriguez, Garrido and Nodarse each face maximum prison sentences of 50 years. Carrazana and Dagnesses face 10 year maximum terms in prison.

An indictment is merely a charge and defendants are presumed innocent until proven guilty.

The case is being prosecuted by Trial Attorney John K. Neal and Deputy Chief Kirk Ogrosky of the Criminal Division’s Fraud Section. The case was investigated by the FBI and the Department of Health and Human Services, Office of Inspector General. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and U.S. Attorney Acosta of the Southern District of Florida. Since strike force operations began in March 2007, 107 cases including 196 defendants have been indicted. Collectively, these defendants are alleged to have fraudulently billed the Medicare program for more than $600 million.

A copy of this press release may be found on the website of the Department of Justice at: http://www.usdoj.gov/opa/pr/2009/February/09-crm-122.html

January 28, 2009

Owner of Pharmaceutical Wholesale Company Pleads Guilty to Medicare Fraud (U.S. Attorney for the Southern District of Florida)

WASHINGTON – The owner and operator of HME Solutions Inc., dba Lifecare Medical (Lifecare Medical), a licensed pharmaceutical wholesale company in Miami, pleaded guilty today to defrauding the Medicare program in connection with a $5.3 million HIV-infusion fraud scheme, Acting Assistant Attorney General Rita M. Glavin of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida announced.

Harold Sio, 33, pleaded guilty to conspiracy to commit healthcare fraud and conspiracy to commit money laundering before U.S. District Judge Ursula Ungaro in Miami. At the plea hearing, Sio admitted that between August 2004 and November 2006, he conspired with Juan A. Marrero and Orlando Pascual Jr., the owners of Medcore Group LLC (Medcore), to commit health care fraud and launder the proceeds of that health care fraud.

In his plea, Sio admitted that he supplied pharmaceuticals to Marrero and Pascual for the purpose of committing Medicare fraud. Sio also admitted providing invoices that documented huge quantities of pharmaceuticals, which were received by Medcore, when in fact he only delivered small amounts. Sio acknowledged that he accepted payment from Marrero and Pascual then returned cash to them so that the cash could ultimately be used to pay patients. Marrero and Pascual pleaded guilty in January 2009 to Medicare fraud and are scheduled for sentencing on April 3, 2009. Sio is scheduled to be sentenced on March 24, 2009.

In pleading guilty, Marrero and Pascual both admitted that they falsely billed Medicare more than $5.3 million for unnecessary infusion treatments. Both Marrero and Pascual acknowledged that all the patients who received injections or infusions at Medcore were paid cash kickbacks to induce them to visit to the clinic.

Marrero and Pascual acknowledged that clinic employees intentionally manipulated patients’ blood samples to make the patients’ need for treatment appear legitimate, when in fact it was not, as well as to make the patients' medical files appear legitimate. According to court documents, physicians, a physician's assistant and phlebotomists, were used by Marrero and Pascual to help facilitate the scheme.

Four co-defendants in the case are scheduled for trial beginning Feb. 23, 2009, in the Southern District of Florida. An indictment is merely a charge, and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.

The case was prosecuted by Deputy Chief Kirk Ogrosky, Assistant Chief John S. (Jay) Darden, and Trial Attorney Charles Reed of the Criminal Division’s Fraud Section and investigated by the Department of Health and Human Services, Office of the Inspector General and FBI. The case was brought as part of the Medicare Fraud Strike Force (MFSF), supervised by the Criminal Division’s Fraud Section and U.S. Attorney Acosta of the Southern District of Florida. Since the inception of MFSF operations, federal prosecutors have indicted 106 cases with 190 defendants in both Los Angeles and Miami. Collectively, these defendants fraudulently billed the Medicare program for more than half a billion dollars.

A copy of this press release may be found on the website of the Department of Justice at: http://www.usdoj.gov/opa/pr/2009/January/

January 8, 2009

Medical Clinic Owner Pleads Guilty to Role in $5.3 Million Medicare Fraud Scheme (U.S. Attorney for the Southern District of Florida)

WASHINGTON – The owner and operator of two Miami medical clinics has pleaded guilty to defrauding the Medicare program in connection with a $5.3 million HIV infusion fraud scheme, Acting Assistant Attorney General Matthew Friedrich of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida announced today.

Orlando Pascual Jr., 43, pleaded guilty on Jan. 7, 2009, to conspiracy to commit healthcare fraud before U.S. District Judge Ursula Ungaro. In his plea, Pascual admitted that he co-owned two Miami clinics named Medcore Group LLC (Medcore) and M&P Group of South Florida Inc. (M&P) that purported to specialize in the treatment of HIV-positive patients. Pascual admitted that beginning in August 2004 and continuing through November 2006 he conspired with others to submit approximately $5.3 million in fraudulent claims to Medicare. Pascual also pleaded guilty to two separate schemes to launder the proceeds of the health care fraud.

During the plea, Pascual admitted that Medcore and M&P were operated for the purpose of defrauding Medicare, that the treatments for infused or injected drugs were not medically necessary, and that he and others paid cash kickbacks to the patients for every visit to the clinic. To obtain all the cash necessary to pay the patients, Pascual stated that he and others would write checks that appeared legitimate to people who would cash the checks and then return the cash to them for a fee.

Pascual acknowledged that most patients were HIV-positive or were given false diagnoses of cancer. He stated during the plea that he and others used physicians, a physician’s assistant and phlebotomists to help facilitate the scheme. In addition, Pascual acknowledged that clinic employees intentionally manipulated patients’ blood samples so that they would appear to need treatment, when in fact they did not. Pascual stated that such tampering was done to make the medical files appear legitimate.

Pascual is currently incarcerated for Medicare fraud involving the operation of a durable medical equipment (DME) company in Miami from 2001 to 2003. Sentencing in this case is scheduled for April 3, 2009.

Seven co-defendants in the case are scheduled for trial beginning Feb. 9, 2009, in the Southern District of Florida. An indictment is merely a charge, and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt.