FROM: U.S. DEPARTMENT OF JUSTICE
Wednesday, October 17, 2012
Clinic Owners Plead Guilty in Detroit-Area Infusion Therapy Scheme
WASHINGTON – Two owners and operators of clinics that claimed to specialize in treating HIV and other conditions pleaded guilty today for their roles in an infusion therapy scheme carried out at two Detroit-area clinics that submitted millions of dollars in fraudulent claims to Medicare.
The guilty pleas were announced by Assistant Attorney General Lanny A. Breuer of the Department of Justice’s Criminal Division; U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan; Special Agent in Charge Robert Foley III of the FBI’s Detroit Field Office; and Special Agent in Charge Lamont Pugh III of the HHS Office of Inspector General’s (HHS-OIG) Chicago Regional Office.
Raymond Arias, 40, and his wife, Emelitza Arias, 25, of Troy, Mich., each pleaded guilty, before U.S. District Judge Paul D. Borman of the Eastern District of Michigan, to one count of conspiracy to commit health care fraud. At sentencing, the defendants each face a maximum potential penalty of 10 years in prison and a $250,000 fine. Sentencing is currently scheduled for Feb. 12, 2013.
According to plea documents, Raymond Arias conceived of and oversaw fraud schemes at two clinics for which he was a beneficial owner: Elite Wellness LLC, and Carefirst Occupational & Rehabilitation Center Inc. He admitted to paying physicians to refer Medicare beneficiaries to Elite Wellness, and to purchasing Medicare beneficiary identifications for the purpose of submitting fraudulent claims to Medicare for expensive infusion therapy services that were not rendered as claimed by Carefirst.
According to court documents, Raymond Arias attempted to hide the Elite Wellness scheme from law enforcement by directing a nominee owner to assume control of the claims submitted and the bank account into which Medicare payments were deposited. After the nominee owner became involved, Raymond Arias and his alleged co-conspirators submitted approximately $10 million in claims over a 3-month period beginning in August 2010.
According to court documents, Raymond Arias directed this nominee to transfer approximately $2.6 million in Medicare payments offshore to Panama and Mexico.
Between approximately October 2009 and October 2010, Raymond Arias admitted, he and his alleged co-conspirators at Elite Wellness submitted or caused to be submitted approximately $12.5 million in fraudulent claims to the Medicare program for infusion therapy services that were not rendered. Medicare paid approximately $5.4 million of those claims.
According to plea documents, Emelitza Arias participated with her husband in a scheme to defraud Medicare by submitting claims for expensive infusion therapy services that were not rendered by Carefirst, of which she was also an owner. In an attempt to create an appearance that Carefirst was a legitimate enterprise, Emelitza Arias injected Medicare beneficiaries with vitamins. Emelitza Arias also assumed responsibility for the claims submitted by Carefirst, and managed the bank account into which the fraud proceeds were deposited.
Between approximately July 2010 and June 2011, Raymond and Emelitza Arias and their alleged co-conspirators at Carefirst submitted or caused to be submitted more than $900,000 in fraudulent claims to the Medicare program for infusion therapy services that were not rendered. Medicare paid approximately $530,000 of those claims.
This case is being prosecuted by Assistant U.S. Attorney Philip A. Ross of the Eastern District of Michigan and Trial Attorney Catherine K. Dick of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG and brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan.
Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.
Saturday, October 20, 2012
Friday, October 19, 2012
SANTA BARBARA NEWS-PRESS ORDERED TO BARGAIN IN GOOD FAITH WITH UNION
FROM: U.S. NATIONAL LABOR RELATIONS BOARD
Because of continuing violations of federal labor law, the NLRB has issued a broad cease-and-desist order against the publisher of the Santa Barbara News-Press and ordered it to bargain in good faith with the union representing its employees. The Board also extended the union’s certification period by one year and ordered Ampersand Publishing, LLC, to reimburse the union for past bargaining expenses.
A three-member panel of the Board noted that its September 27 ruling against Ampersand was the second in two years, and that the publisher has failed to bargain in good faith with the Graphics Communications Conference of the International Brotherhood of Teamster despite an overwhelming vote in favor of the union by employees. Instead, the Board found, Ampersand submitted proposals that would have allowed the publisher to unilaterally set wages, discipline employees and hire and fire employees.
The Board also found, in agreement with Administrative Law Judge Clifford H. Anderson, that the publisher committed numerous other violations, including unlawfully firing and suspending an employee for union and concerted activities, laying off an employee without providing the Union with notice or an opportunity to bargain, failing to grant unit employees traditional merit increases without bargaining with the union, transferring unit work to non-union freelance journalists, and offering employees the services of its attorneys if contacted by a Board agent investigating unfair labor practice charges.
"By bargaining in bad faith with the Union for the entire certification year and beyond, while simultaneously engaging in serious and widespread unfair labor practices, the Respondent has both precluded any progress in bargaining and undermined the Union’s bargaining strength and support among unit employees," the Board found.
In addition to extending the certification period and ordering reimbursement of bargaining expenses, the Board ordered the publisher to stop moving union work to non-union contract employees, to rescind (on request) a unilaterally-imposed one-story-per-day productivity standard, and to offer reinstatement to two employees and make them whole for lost earnings.
In its earlier decisionagainst Ampersand Publishing, issued in August 2011, the Board found the publisher had fired numerous News-Press journalists because of their union activity and ordered it to: offer reinstatement to eight employees, including six who hung a banner from a footbridge urging motorists to cancel their newspaper subscription and two others who were ostensibly fired for ‘biased reporting’; rescind discriminatory evaluations of four union supporters; rescind suspension notices sent to eleven employees; and make all harmed employees whole with backpay awards
Because of continuing violations of federal labor law, the NLRB has issued a broad cease-and-desist order against the publisher of the Santa Barbara News-Press and ordered it to bargain in good faith with the union representing its employees. The Board also extended the union’s certification period by one year and ordered Ampersand Publishing, LLC, to reimburse the union for past bargaining expenses.
A three-member panel of the Board noted that its September 27 ruling against Ampersand was the second in two years, and that the publisher has failed to bargain in good faith with the Graphics Communications Conference of the International Brotherhood of Teamster despite an overwhelming vote in favor of the union by employees. Instead, the Board found, Ampersand submitted proposals that would have allowed the publisher to unilaterally set wages, discipline employees and hire and fire employees.
The Board also found, in agreement with Administrative Law Judge Clifford H. Anderson, that the publisher committed numerous other violations, including unlawfully firing and suspending an employee for union and concerted activities, laying off an employee without providing the Union with notice or an opportunity to bargain, failing to grant unit employees traditional merit increases without bargaining with the union, transferring unit work to non-union freelance journalists, and offering employees the services of its attorneys if contacted by a Board agent investigating unfair labor practice charges.
"By bargaining in bad faith with the Union for the entire certification year and beyond, while simultaneously engaging in serious and widespread unfair labor practices, the Respondent has both precluded any progress in bargaining and undermined the Union’s bargaining strength and support among unit employees," the Board found.
In addition to extending the certification period and ordering reimbursement of bargaining expenses, the Board ordered the publisher to stop moving union work to non-union contract employees, to rescind (on request) a unilaterally-imposed one-story-per-day productivity standard, and to offer reinstatement to two employees and make them whole for lost earnings.
In its earlier decisionagainst Ampersand Publishing, issued in August 2011, the Board found the publisher had fired numerous News-Press journalists because of their union activity and ordered it to: offer reinstatement to eight employees, including six who hung a banner from a footbridge urging motorists to cancel their newspaper subscription and two others who were ostensibly fired for ‘biased reporting’; rescind discriminatory evaluations of four union supporters; rescind suspension notices sent to eleven employees; and make all harmed employees whole with backpay awards
Wednesday, October 17, 2012
GLOBELFX CLUB, INC. TO PAY FINE FOR CONCEALING FACTS AND MAKING MISREPRESENTATIONS TO NATIONAL FUTURES ASSOCIATION
FROM: U.S. COMMODITY FUTURES TRADING COMMISSION,
Federal Court in Florida Imposes $350,000 Penalty against GlobeFX Club, Inc. and
Jeremy Munson Globe for Making False Statements to the National Futures
Association
Court permanently bars defendants from commodities industry
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) obtained a federal court consent order of permanent injunction requiring defendants GlobeFX Club, Inc. (GFC) and Jeremy Munson Globe, both of Homestead, Fla., jointly and severally to pay a $350,000 civil monetary penalty for concealing material facts and making false statements or misrepresentations to the National Futures Association (NFA) during an investigation and audit.
The order, entered on October 4, 2012, by Judge Paul C. Huck of the U.S. District Court for the Southern District of Florida, also imposes permanent trading and registration bans against the defendants and permanently prohibits them from violating the Commodity Exchange Act, as charged.
The consent order stems from a CFTC complaint filed on March 17, 2011 (see CFTC Press Release 6006-11, March 21, 2011). The complaint charges that from February to March 2009, GFC, through Globe, made false, fictitious, or fraudulent statements to the NFA during an NFA investigation and audit of GFC. According to the order, Globe told the NFA that GFC had never operated a pool or managed client accounts. This statement by Globe was false, the order finds. Also, in written correspondence to the NFA and orally, Globe continually denied that GFC operated a commodity pool, received client funds, managed client accounts, or had a trading account in the name of the firm, and Globe claimed GFC’s disclosure document was approved by the NFA. These statements were also false, the order finds.
CFTC Division of Enforcement staff responsible for this case are Tracey Wingate, Timothy J. Mulreany, Sophia Siddiqui, Michael Amakor, Paul Hayeck, and Joan Manley.
Federal Court in Florida Imposes $350,000 Penalty against GlobeFX Club, Inc. and
Jeremy Munson Globe for Making False Statements to the National Futures
Association
Court permanently bars defendants from commodities industry
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) obtained a federal court consent order of permanent injunction requiring defendants GlobeFX Club, Inc. (GFC) and Jeremy Munson Globe, both of Homestead, Fla., jointly and severally to pay a $350,000 civil monetary penalty for concealing material facts and making false statements or misrepresentations to the National Futures Association (NFA) during an investigation and audit.
The order, entered on October 4, 2012, by Judge Paul C. Huck of the U.S. District Court for the Southern District of Florida, also imposes permanent trading and registration bans against the defendants and permanently prohibits them from violating the Commodity Exchange Act, as charged.
The consent order stems from a CFTC complaint filed on March 17, 2011 (see CFTC Press Release 6006-11, March 21, 2011). The complaint charges that from February to March 2009, GFC, through Globe, made false, fictitious, or fraudulent statements to the NFA during an NFA investigation and audit of GFC. According to the order, Globe told the NFA that GFC had never operated a pool or managed client accounts. This statement by Globe was false, the order finds. Also, in written correspondence to the NFA and orally, Globe continually denied that GFC operated a commodity pool, received client funds, managed client accounts, or had a trading account in the name of the firm, and Globe claimed GFC’s disclosure document was approved by the NFA. These statements were also false, the order finds.
CFTC Division of Enforcement staff responsible for this case are Tracey Wingate, Timothy J. Mulreany, Sophia Siddiqui, Michael Amakor, Paul Hayeck, and Joan Manley.
Tuesday, October 16, 2012
FORMER OWNERS OF DME WHOLESALE COMPANY ARRESTED FOR ALLEGED MEDICARE FRAUD
FROM: U.S. DEPARTMENT OF JUSTICE
Thursday, October 11, 2012
Former Owners of Los Angeles DME Wholesale Company Arrested and Charged with Participating in $16.6 Million Medicare Fraud Scheme
WASHINGTON – The former owners of a durable medical equipment (DME) wholesale company located in Ontario, Calif., were arrested late yesterday at Los Angeles International Airport in connection with a DME fraud scheme that resulted in the submission of over $16.6 million in false claims to Medicare and are expected to appear this afternoon in Los Angeles federal court.
The arrest was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney André Birotte Jr. of the Central District of California; Glenn R. Ferry, Special Agent-in-Charge for the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); and Timothy Delaney, Special Agent in Charge of the FBI’s Los Angeles Field Office.
Rajinder Singh Paul, 69, and his wife, Baljit Kaur Paul, 65, were arrested on conspiracy and health care fraud charges at the airport as they returned from a trip abroad. According to the indictment unsealed upon their arrests, Rajinder and Baljit Paul owned and operated a DME wholesale supply company called Major’s Wholesale Medical Supply Inc., which was located in Ontario. Between 2002 and 2009, according to the indictment, when they were terminated from Major’s after selling its assets to a new owner, Rajinder and Baljit Paul sold primarily high-end power wheelchairs to DME supply companies for approximately $850 to $1,000 per wheelchair. The DME companies, many of which were allegedly fraudulent, billed these power wheelchairs to Medicare at a cost of $3,000 to $6,000 per wheelchair.
According to the indictment, in order to attract and keep the DME companies’ business and prevent Medicare from withholding money that the companies would use to pay Major’s, Rajinder and Baljit Paul provided over 170 DME companies with backdated, altered, and fabricated invoices which reflected that the companies had purchased power wheelchairs and DME from Major’s earlier than they had. Rajinder and Baljit Paul also allegedly provided the DME companies with false invoices for DME that the companies never purchased from Major’s. Rajinder Paul, Baljit Paul, or employees acting at their direction, allegedly created these false invoices using invoice numbers from old invoices or serial numbers from DME that Major’s had already sold or not yet received from its manufacturers. The DME companies then allegedly used these backdated, altered, and fabricated invoices to defraud Medicare or thwart Medicare audits.
In addition, the indictment alleges that the Pauls provided the DME companies with false inventory purchase agreements that showed the companies had credit limits with Major’s which were higher than the credit limits that Major’s actually extended to the companies. The DME companies then submitted these false inventory purchase agreements to Medicare to meet one of the Medicare regulations necessary for the companies to obtain and maintain their Medicare billing privileges, namely, that the companies had contracts with DME wholesalers and other parties to purchase the DME that they billed to Medicare.
The indictment alleges that as a result of this scheme, the Pauls and the owners and operators of certain of the companies that Rajinder and Baljit Paul provided with fraudulent invoices submitted approximately $16,662,143 in false claims to Medicare, and received approximately $9,743,609 on those claims.
Rajinder and Baljit Paul are each charged with one count of conspiracy to commit health care fraud and one count of making false statements. The conspiracy count carries a maximum potential penalty of 10 years in prison, and the false statements count carries a maximum potential penalty of five years in prison. Each count also carries a maximum $250,000 fine.
The case is being prosecuted by Trial Attorney Jonathan T. Baum of the Criminal Division’s Fraud Section. The case is being investigated by the FBI, HHS-OIG, and the California Department of Justice, 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 Central District of California.
The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Since its inception in March 2007, strike force operations in nine locations have charged more than 1,480 defendants who collectively have billed the Medicare program for more than $4.8 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.
Thursday, October 11, 2012
Former Owners of Los Angeles DME Wholesale Company Arrested and Charged with Participating in $16.6 Million Medicare Fraud Scheme
WASHINGTON – The former owners of a durable medical equipment (DME) wholesale company located in Ontario, Calif., were arrested late yesterday at Los Angeles International Airport in connection with a DME fraud scheme that resulted in the submission of over $16.6 million in false claims to Medicare and are expected to appear this afternoon in Los Angeles federal court.
The arrest was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; U.S. Attorney André Birotte Jr. of the Central District of California; Glenn R. Ferry, Special Agent-in-Charge for the Los Angeles Region of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); and Timothy Delaney, Special Agent in Charge of the FBI’s Los Angeles Field Office.
Rajinder Singh Paul, 69, and his wife, Baljit Kaur Paul, 65, were arrested on conspiracy and health care fraud charges at the airport as they returned from a trip abroad. According to the indictment unsealed upon their arrests, Rajinder and Baljit Paul owned and operated a DME wholesale supply company called Major’s Wholesale Medical Supply Inc., which was located in Ontario. Between 2002 and 2009, according to the indictment, when they were terminated from Major’s after selling its assets to a new owner, Rajinder and Baljit Paul sold primarily high-end power wheelchairs to DME supply companies for approximately $850 to $1,000 per wheelchair. The DME companies, many of which were allegedly fraudulent, billed these power wheelchairs to Medicare at a cost of $3,000 to $6,000 per wheelchair.
According to the indictment, in order to attract and keep the DME companies’ business and prevent Medicare from withholding money that the companies would use to pay Major’s, Rajinder and Baljit Paul provided over 170 DME companies with backdated, altered, and fabricated invoices which reflected that the companies had purchased power wheelchairs and DME from Major’s earlier than they had. Rajinder and Baljit Paul also allegedly provided the DME companies with false invoices for DME that the companies never purchased from Major’s. Rajinder Paul, Baljit Paul, or employees acting at their direction, allegedly created these false invoices using invoice numbers from old invoices or serial numbers from DME that Major’s had already sold or not yet received from its manufacturers. The DME companies then allegedly used these backdated, altered, and fabricated invoices to defraud Medicare or thwart Medicare audits.
In addition, the indictment alleges that the Pauls provided the DME companies with false inventory purchase agreements that showed the companies had credit limits with Major’s which were higher than the credit limits that Major’s actually extended to the companies. The DME companies then submitted these false inventory purchase agreements to Medicare to meet one of the Medicare regulations necessary for the companies to obtain and maintain their Medicare billing privileges, namely, that the companies had contracts with DME wholesalers and other parties to purchase the DME that they billed to Medicare.
The indictment alleges that as a result of this scheme, the Pauls and the owners and operators of certain of the companies that Rajinder and Baljit Paul provided with fraudulent invoices submitted approximately $16,662,143 in false claims to Medicare, and received approximately $9,743,609 on those claims.
Rajinder and Baljit Paul are each charged with one count of conspiracy to commit health care fraud and one count of making false statements. The conspiracy count carries a maximum potential penalty of 10 years in prison, and the false statements count carries a maximum potential penalty of five years in prison. Each count also carries a maximum $250,000 fine.
The case is being prosecuted by Trial Attorney Jonathan T. Baum of the Criminal Division’s Fraud Section. The case is being investigated by the FBI, HHS-OIG, and the California Department of Justice, 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 Central District of California.
The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Since its inception in March 2007, strike force operations in nine locations have charged more than 1,480 defendants who collectively have billed the Medicare program for more than $4.8 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.
Monday, October 15, 2012
TEXAS MAN PLEADS GUILTY IN $374 MILLION MEDICARE FRAUD SCHEME
FROM: U.S. DEPARTMENT OF JUSTICE
Thursday, October 11, 2012
Owner of Texas Home Health Services Company Pleads Guilty, Admits Role in $374 Million Fraud Scheme
WASHINGTON - A Dallas-area home health services company owner today admitted his role in a $374 million home health fraud scheme in which he and others conspired to bill Medicare for unnecessary services that were never performed. Cyprian Akamnonu, 64, of Arlington, Texas, entered his guilty plea to one count of conspiracy to commit health care fraud before U.S. District Judge Sam A. Lindsay in Dallas federal court.
The guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department's Criminal Division; U.S. Attorney for the Northern District of Texas Sarah R. Saldaña; Special Agent in Charge Diego G. Rodriguez of the FBI’s Dallas Field Office; Special Agent in Charge Mike Fields of the U.S. Department of Health and Human Services Office of Inspector General's (HHS-OIG) Dallas Regional Office; and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU).
According to court documents, beginning in at least January 2006, Akamnonu, along with his wife Pat Akamnonu, owned and operated Ultimate Care Home Health Services, Inc. Cyprian Akamnonu admitted that he directed his wife and others to recruit Medicare beneficiaries from Dallas neighborhoods for home health services they did not need and for which they did not qualify. Once the beneficiaries were recruited, Cyprian Akamnonu would take prescriptions for home health services to the offices of Medistat Group Associates, P.A., owned and operated by co-defendant Jacques Roy, M.D.
Cyprian Akamnonu admitted he brought the prescriptions to Roy because he and Roy had a fraudulent arrangement whereby Ultimate provided Roy with beneficiaries to bolster Medistat’s patient roster in exchange for Roy’s certification for skilled nursing services of any beneficiary brought to him. Roy’s office manager, co-defendant Teri Sivils, and others would allegedly then sign these prescriptions on Roy’s behalf. Cyprian Akamnonu admitted to paying Sivils cash to sign the prescriptions.
Cyprian Akamnonu admitted that once he obtained signed prescriptions, nurses acting at his direction would perform cursory visits for the beneficiaries they had recruited that bore little relationship to the skilled nursing services which Roy had purportedly prescribed. Ultimate would then bill Medicare, at Cyprian Akamnonu’s direction, for skilled nursing services that were not necessary and were not performed.
Court documents show that from January 2006 through November 2011, Roy or another Medistat physician allegedly certified over 78% of the beneficiaries serviced by Ultimate. Ultimate billed over $43 million to the Medicare program for these beneficiaries. Roy, in turn, allegedly incorporated these beneficiaries into his own practice and billed over $2.4 million for services related to them.
At sentencing, Cyprian Akamnonu faces a maximum potential penalty of 10 years in prison and a $250,000 fine on the conspiracy count. Sentencing is currently scheduled for Feb. 4, 2013. As part of his plea agreement, he has also agreed not to contest the forfeiture of 21 real properties, four automobiles, and funds in a number of personal and business accounts connected to proceeds of the fraud.
His six co-defendants, including his wife, await trial on related charges, currently set for June 2013. The charges and allegations contained in the indictment against them are merely accusations and the defendants are presumed innocent unless and until proven guilty.
The case is being prosecuted by Assistant U.S. Attorneys Michael Elliott and Mindy Sauter of the U.S. Attorney’s Office for the Northern District of Texas, and Deputy Chief Sam Sheldon and Trial Attorney Ben O’Neil 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 Northern District of Texas.
Thursday, October 11, 2012
Owner of Texas Home Health Services Company Pleads Guilty, Admits Role in $374 Million Fraud Scheme
WASHINGTON - A Dallas-area home health services company owner today admitted his role in a $374 million home health fraud scheme in which he and others conspired to bill Medicare for unnecessary services that were never performed. Cyprian Akamnonu, 64, of Arlington, Texas, entered his guilty plea to one count of conspiracy to commit health care fraud before U.S. District Judge Sam A. Lindsay in Dallas federal court.
The guilty plea was announced by Assistant Attorney General Lanny A. Breuer of the Justice Department's Criminal Division; U.S. Attorney for the Northern District of Texas Sarah R. Saldaña; Special Agent in Charge Diego G. Rodriguez of the FBI’s Dallas Field Office; Special Agent in Charge Mike Fields of the U.S. Department of Health and Human Services Office of Inspector General's (HHS-OIG) Dallas Regional Office; and the Texas Attorney General’s Medicaid Fraud Control Unit (MFCU).
According to court documents, beginning in at least January 2006, Akamnonu, along with his wife Pat Akamnonu, owned and operated Ultimate Care Home Health Services, Inc. Cyprian Akamnonu admitted that he directed his wife and others to recruit Medicare beneficiaries from Dallas neighborhoods for home health services they did not need and for which they did not qualify. Once the beneficiaries were recruited, Cyprian Akamnonu would take prescriptions for home health services to the offices of Medistat Group Associates, P.A., owned and operated by co-defendant Jacques Roy, M.D.
Cyprian Akamnonu admitted he brought the prescriptions to Roy because he and Roy had a fraudulent arrangement whereby Ultimate provided Roy with beneficiaries to bolster Medistat’s patient roster in exchange for Roy’s certification for skilled nursing services of any beneficiary brought to him. Roy’s office manager, co-defendant Teri Sivils, and others would allegedly then sign these prescriptions on Roy’s behalf. Cyprian Akamnonu admitted to paying Sivils cash to sign the prescriptions.
Cyprian Akamnonu admitted that once he obtained signed prescriptions, nurses acting at his direction would perform cursory visits for the beneficiaries they had recruited that bore little relationship to the skilled nursing services which Roy had purportedly prescribed. Ultimate would then bill Medicare, at Cyprian Akamnonu’s direction, for skilled nursing services that were not necessary and were not performed.
Court documents show that from January 2006 through November 2011, Roy or another Medistat physician allegedly certified over 78% of the beneficiaries serviced by Ultimate. Ultimate billed over $43 million to the Medicare program for these beneficiaries. Roy, in turn, allegedly incorporated these beneficiaries into his own practice and billed over $2.4 million for services related to them.
At sentencing, Cyprian Akamnonu faces a maximum potential penalty of 10 years in prison and a $250,000 fine on the conspiracy count. Sentencing is currently scheduled for Feb. 4, 2013. As part of his plea agreement, he has also agreed not to contest the forfeiture of 21 real properties, four automobiles, and funds in a number of personal and business accounts connected to proceeds of the fraud.
His six co-defendants, including his wife, await trial on related charges, currently set for June 2013. The charges and allegations contained in the indictment against them are merely accusations and the defendants are presumed innocent unless and until proven guilty.
The case is being prosecuted by Assistant U.S. Attorneys Michael Elliott and Mindy Sauter of the U.S. Attorney’s Office for the Northern District of Texas, and Deputy Chief Sam Sheldon and Trial Attorney Ben O’Neil 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 Northern District of Texas.
Sunday, October 14, 2012
JUSTICE ALLEGES 3 COMPANIES VIOLATED FAIR CREDIT REPORTING ACT
FROM: U.S. DEPARTMENT OF JUSTICE
Thursday, October 11, 2012
Justice Department Files Lawsuit Against Three Related Companies for Violating Fair Credit Reporting Act
The United States has filed a complaint against three related companies that bought and sold consumer credit reports, the Justice Department announced today. The government’s complaint charges these companies with violating the Fair Credit Reporting Act (FCRA). The companies have agreed to pay a $1.2 million civil penalty to resolve these charges.
In a complaint filed Oct. 9, 2012, the United States alleged that Direct Lending Source Inc., and Bailey & Associates Advertising Inc., both Florida corporations, Virtual Lending Source LLC, based in San Diego, Calif., and the principals of all of these entities, Robert M. Bailey, Jr. and Linda Giordiano , violated the FCRA by failing to comply with provisions forbidding the sale of credit reports without a "permissible purpose." The complaint alleges that the defendants purchased thousands of "pre-screened" consumer lists, or collections of credit report data. The only permissible purpose under the Act for using such prescreened lists is to make "firm offers of credit or insurance" to consumers. However, the complaint alleges that the defendants re-sold the lists to dealers who marketed loan modification, debt relief and credit repair services rather than making firm offers of credit. According to the complaint, some of the dealers who purchased the defendants’ credit report data have become the subject of law enforcement actions or warnings involving fraud committed against consumers in financial trouble.
The complaint also alleges that the defendants did not take reasonable steps to identify the ultimate purchasers of the credit reports. In some cases, according to the complaint, the defendants sold lists to brokers who then re-sold them to unidentified entities.
"The sensitive financial information in credit reports must be protected from those who would use it to target vulnerable consumers for sham offers," said Stuart Delery, Acting Assistant Attorney General for the Civil Division. "We will work with the Federal Trade Commission to aggressively enforce the laws that safeguard these reports."
Along with the $1.2 million civil penalty, the defendants agreed to injunctions against future FCRA and FTC violations in a proposed consent decree that must be approved by the court. The proposed order would prohibit the defendants from using, obtaining or reselling consumer reports for unauthorized purposes. The proposed order also would prohibit the defendants from selling consumer reports in connection with solicitations for debt relief and mortgage relief services that charge advance fees.
The Federal Trade Commission (FTC), which oversees the FCRA, referred the case to the Department. The lawsuit, United States v. Direct Lending Source et al., was filed in the Southern District of California.
Acting Assistant Attorney General Delery thanked the FTC for referring this matter to the Department. The Consumer Protection Branch of the Justice Department’s Civil Division brought the case on behalf of the United States.
Thursday, October 11, 2012
Justice Department Files Lawsuit Against Three Related Companies for Violating Fair Credit Reporting Act
The United States has filed a complaint against three related companies that bought and sold consumer credit reports, the Justice Department announced today. The government’s complaint charges these companies with violating the Fair Credit Reporting Act (FCRA). The companies have agreed to pay a $1.2 million civil penalty to resolve these charges.
In a complaint filed Oct. 9, 2012, the United States alleged that Direct Lending Source Inc., and Bailey & Associates Advertising Inc., both Florida corporations, Virtual Lending Source LLC, based in San Diego, Calif., and the principals of all of these entities, Robert M. Bailey, Jr. and Linda Giordiano , violated the FCRA by failing to comply with provisions forbidding the sale of credit reports without a "permissible purpose." The complaint alleges that the defendants purchased thousands of "pre-screened" consumer lists, or collections of credit report data. The only permissible purpose under the Act for using such prescreened lists is to make "firm offers of credit or insurance" to consumers. However, the complaint alleges that the defendants re-sold the lists to dealers who marketed loan modification, debt relief and credit repair services rather than making firm offers of credit. According to the complaint, some of the dealers who purchased the defendants’ credit report data have become the subject of law enforcement actions or warnings involving fraud committed against consumers in financial trouble.
The complaint also alleges that the defendants did not take reasonable steps to identify the ultimate purchasers of the credit reports. In some cases, according to the complaint, the defendants sold lists to brokers who then re-sold them to unidentified entities.
"The sensitive financial information in credit reports must be protected from those who would use it to target vulnerable consumers for sham offers," said Stuart Delery, Acting Assistant Attorney General for the Civil Division. "We will work with the Federal Trade Commission to aggressively enforce the laws that safeguard these reports."
Along with the $1.2 million civil penalty, the defendants agreed to injunctions against future FCRA and FTC violations in a proposed consent decree that must be approved by the court. The proposed order would prohibit the defendants from using, obtaining or reselling consumer reports for unauthorized purposes. The proposed order also would prohibit the defendants from selling consumer reports in connection with solicitations for debt relief and mortgage relief services that charge advance fees.
The Federal Trade Commission (FTC), which oversees the FCRA, referred the case to the Department. The lawsuit, United States v. Direct Lending Source et al., was filed in the Southern District of California.
Acting Assistant Attorney General Delery thanked the FTC for referring this matter to the Department. The Consumer Protection Branch of the Justice Department’s Civil Division brought the case on behalf of the United States.
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