White Collar Crime

Published on: May 1, 2011

Major Los Angeles Medicare Fraud News – Couple Pleads Guilty in $200 Million Medicare Fraud Scam

As this blog has been reporting for months now, federal investigators have been really cracking down on crimes like Southern California Medicare and Medical fraud. A breaking story out of Miami highlights how much the government means “business.”

According to an April 14th story in the Miami Herald, Lawrence Duran and his wife, Marianella Valera, pled guilty to stealing $200 million from Medicare as part of a massive conspiracy. The couple could face 20 years in prison – for running what the Herald describes as “The nation’s largest mental health racket.”

The couple, who owned seven different mental health clinics, got indicted last October on charges of defrauding 22 defendants, including psychiatrists, recruiters, and even senior employers in their companies. The Assistant Attorney General of the Justice Department’s Criminal Division, Lanny Breuer, did not mince words: “they reaped millions in illegal profits by operating a sham mental healthcare company that provided unnecessary and illegitimate treatments to patients, many of whom were recruited through bribes and kickbacks, and then they laundered the proceeds.”

Published on: April 18, 2011

Disturbing Los Angeles Medicare Fraud News: Couple in Minnesota Could Get Six Decades (Each!) in Prison

by Michael Kraut

A new Minnesota Public Radio report has public health authorities, economists, and bloggers who focus on issues like Southern California Medicare fraud alike analyzing and chatting about powerful charges against a couple from Brooklyn Park, Minnesota.

Anita and Stephen Soledolu — co-owners of a home healthcare service — allegedly submitted Medicare claims that did not have documentation. Prosecutors allege that the couple bilked Minnesota for over $864,000. The Soledolus face indictments on six felony counts. Each one could be hit with six decades behind bars and penalties of $300,000.

According to a Minnesota Public Radio report: “The Soledolus submitted claims for home care of Medicaid recipients when investigators found clients weren’t home.”

Published on: April 4, 2011

Southern California Medicare Fraud Red Flag: Massive Detroit Bust Alarms Doctors and Chiropractors in the Southland

by Michael Kraut

As regular followers of this blog’s ongoing series on Los Angeles Medicare fraud know, the Federal Government has been stepping up its campaign to bust up Southern California insurance fraud and other white collar crimes – particularly Medicare and Medicaid related schemes.

Today, we’ll focus on a major news story out of Detroit, Michigan. According to the AP, Oscar Linares, a 53-year-old Michigan doctor, allegedly fraudulently billed Medicare for $5.7 million between 2008 and 2010. The Wednesday before last, authorities broke into Linares’ clinic, The Monroe Pain Center, and arrested the doctor.

According to reports from the Monroe Evening News, Linares’ Medicare fraud was unusually intense. He allegedly saw 250 patients a day – actually, he didn’t specifically “see” the patients, he had proxies see the patients and dole out prescriptions for controlled substances like OxyContin. Indeed, if more than 200 patients came in a day, employees allegedly would get bonuses!

Published on: March 21, 2011

Will Los Angeles Healthcare Fraud be Wiped Out by President Obama’s 2012 proposals?

by Michael Kraut

For last several years, we’ve witnessed massive arrests for Southern California Medicare fraud and other healthcare fraud schemes around the nation. Billions of dollars have been seized, and hundreds of people have been arrested and brought to trial. The news practically glitters every week with examples of chiropractors, dentists, doctors, and other healthcare providers caught up in the dragnet.

According to the Centers for Medicare and Medicaid Services, President Obama’s 2012 budget proposes a variety of new antifraud tools that will escalate the government’s fight against fraudsters and scam artists. Some experts estimate that the antifraud tools may save over $32 billion over the next decade. What are some of these new antifraud tools, and will these enhanced tactics really repair the system and prevent abuse and graft?

First, let’s take a look at some crucial statistics:

Published on: February 28, 2011

Massive Los Angeles Medicare Fraud Bust – Five Suspects Accused of Cheating Medicare of $28 million

by Michael Kraut

Last week, 700 FBI and Health and Human Services agents rounded up 111 suspects in nine cities – including five people suspected of Los Angeles Medicare fraud – in the “largest-ever Federal health care fraud takedown” in the United States, according to government officials. The Los Angeles Times reports that five LA defendants “cheated the government out of more than $225 million in false billing schemes that included fraudulent claims, kickback operations, money laundering and identity theft.”

A spokesperson for the Justice Department’s Criminal Division, Assistant Attorney General Lanny Breuer, said “our message is clear… we are determined to put Medicare fraudsters out of business.”

The Justice Department’s task force has really revved up, since its inception in early 2007. So far, nearly 1,000 people have been charged for false billing schemes – approximately 75% of these people have been convicted. The average prison sentence has been quite substantial – 43 months (more than 3.5 years). In 2010 alone, national, state, and local task forces raked in about $4 billion in fines and recovery payments.

Published on: February 14, 2011

Los Angeles Medical Fraud News Alert: Eight Nurses Going to Jail for Defrauding Medicare

by Michael Kraut

When you picture Southern California medical, dental, or chiropractic fraud arrests, you might envision a surly doctor conspiring with a criminal cohort to develop sophisticated white collar crime techniques.

You might not imagine that eight nurses (between the ages of 32 and 55) would be capable of pulling off a scam that bilked Medicare out of nearly $19 million.

But that’s exactly what the Department of Justice has alleged against eight RNs in Miami. The owners of two health care agencies, Florida Home Health Care Providers Inc. and ABC Home Health Inc., allegedly charged Medicare for unnecessary services (or services that never got provided) to the tune of $18.7 million. Last Tuesday, the eight nurse-owners – Diana Sanabia, Daisy Santos, Roberto Rodriguez, Marlene Magadan, Maria Perez, Alberto Alvarez, Yanisley Chao, and Leonardo Malagon — got sentenced to prison time as well as forced restitution (upwards of $700,000) for their roles in the Medicare scam.

Published on: January 31, 2011

Los Angeles Healthcare Fraud Case among 2010’s Biggest Busts, According to CNN

by Michael Kraut

Last Monday, a federal government report announced that over $2.5 billion in Southern California Medicare fraud (and fraud elsewhere) was recovered in 2010. The 84 page report from the Justice and Health & Human Services found that the government’s anti-fraud programs appear to be working well – returning $5 for every dollar spent to combat fraud. Defendants have included hospitals, physicians, manufacturers of medical devices, and pharmaceutical companies.

A CNN report singled out the fraud case of a Tustin, California CFO as “one of the most blatant cases” last year. The CFO pled guilty in April 2010 to charges of recruiting homeless people to engage in unnecessary services in exchange for kickbacks. He was one of 726 different defendants convicted for crimes like Los Angeles healthcare fraud and insurance fraud.

2011 may be an even more vigorous year for anti-fraud activists. The Justice and Health and Human Services report says that over 1,100 new fraud probes will be launched in 2011. 1,700 criminal investigations are pending. And the universe of potential defendants may expand to 2,000+ people. Since the late 1990s, the government has collected approximately $18 billion from individuals and institutions that have committed fraud against Medicare and other healthcare programs.

Published on: January 17, 2011

Southern California Medicare Fraud News Alert — Another Multimillion Dollar Bust Barely Makes a Blip on the News Radar: Why?

by Michael Kraut

Many colorful stories of Los Angeles medical, dental, and chiropractic fraud have hit the news over the past year or so. The public may simply be too exhausted to pay attention to them anymore.

This claim sounds absurd at first. After all, you’d think that stories about high crime involving multi-millions of dollars would enrage citizens or at least stir debate – especially during this prolonged economic malaise. But the shocking reality is that many fascinating stories of Southern California insurance fraud, medical fraud and credit card fraud are simply flying under most people’s radars.

To wit, consider a crazy case out of Gary, Indiana that you no doubt missed:

Published on: January 10, 2011

Pasadena DUI Newsflash: Look Out for 18-Year Olds Plowing into Parked Cars. Yikes!

by Michael Kraut

Whether you are a pedestrian or motorist, you regularly fear encountering someone driving under the influence in Pasadena. Those fears may get ratcheted up when you read the tale of 17-year old Robert Leigh, an Isla Vista resident who crashed into an unbelievable 8 (that’s “eight” as in 1-2-3-4-5-6-7-8!) parked cars on the morning of January 6th up in Santa Barbara.

Before we delve into this amazing story, we should note that anyone who has recently been pulled over for driving under the influence in Pasadena, DUI in Burbank, DUI in Glendale, or driving under the influence in Los Angeles should avail themselves of critical legal counsel as soon as possible.

Okay, having said that, let’s examine the Leigh crash in more detail. According to California Highway Patrol reports, the teenager had been driving his 2009 Toyota Tacoma on El Colegio Road at 3 a. m., when he drifted into the cars like something out of a pinball game. Here is a quote from a local Santa Barbara paper about it:

“He reportedly drifted to the right, striking one parked car, continued on El Colegio and hit four parked vehicles, then negotiated through the Camino Corto intersection. He allegedly struck three more vehicles before he was stopped by a UC police officer.”

Once the CHP arrived at the scene of the multiple accidents, Leigh was booked for DUI and taken to Santa Barbara County jail. Fortunately – and probably this is because the accidents occurred at 3 a. m – no injuries were reported.

No one expects to be involved in a pinball-like Pasadena DUI car accident – especially one with injuries. For good reason, too. California Vehicle Code Sections 23153(a) and 23153(b) will essentially take a typical misdemeanor Los Angeles DUI charge and shoot it up to a felony charge. The difference between a misdemeanor and felony is enormous. It could mean extra years in jail, for instance. It could also mean thousands of dollars more in fines, extremely strict probation terms, longer alcohol school time, and permanent long-term problems for you. For instance, convicted felons often find it extremely difficult to get work and to lease a car or an apartment. You will also be forever prohibited from voting in national elections. Furthermore, you may have to pay hiked up insurance costs and restitution to any victims that you hurt.

The silver lining – if there is any – is that charge of Pasadena DUI with injury is a difficult one for prosecutors to prove. Prosecutors can’t simply say that you hurt someone while DUI; thus, therefore you should be convicted. After all, perhaps you had been driving normally (i.e., not committing any traffic infractions) when a pedestrian darted in front of you. Yes, you hit the pedestrian. But it was his fault! So even that you were DUI and did hurt somebody, in this situation, prosecutors would be hard pressed to make the DUI with injury charge stick.

The general point here is that the laws abounds with nuances and subtleties. Thus, it’s in your best interest to find someone who has lots of experience with Pasadena DUI law — such as Pasadena criminal defense attorney Michael Kraut. Connect with the Kraut Criminal & DUI Lawyers at 790 East Colorado Boulevard, 9th Floor, Pasadena, California 91101 (626-345-1899). Here are some reasons why Attorney Kraut stands head and shoulders above the competition:

• He is Harvard Law School educated
• He is a former prosecutor with 14 plus years as a Deputy DA for the city
• He has a huge success rate at jury trials
• He has maintained numerous excellent relationships with local prosecutors and judges
• He is often called in as an expert on local and national media to talk about DUI matters
• He offers a compassionate and proven process to help his clients.

Published on: January 3, 2011

Los Angeles Medical Fraud News Alert: Doctor Sentenced for Having a Receptionist Pose as MD

by Michael Kraut

The annals of Southern California medical, dental and chiropractic fraud are replete with pretty crazy stories. But a breaking story out of Columbus, Ohio may have even the most tawdry recent Los Angeles white collar crime stories beat. An Ohio area doctor, Charles Njoku, has been sentenced for manipulating his receptionist into posing as a doctor to treat patients and bilk Medicare and Medicaid.

Judge Algenon L. Marbley sentenced Dr. Njoku in District Court to a year of home confinement, three-years of probation, and 416 hours of community service. He must also pay over $130,000 in restitution to Medicare and Medicaid programs. Dr. Njoku — whose medical license has not yet been suspended, according to the Columbus Dispatch — should be counting as blessings. The judge could have sentenced him to three decades behind bars and a fine of $1.5 million for his crimes.

His receptionist and co-conspirator, Veronica Scott-Guiler, was also arrested for medical fraud back in January. Scott-Guiler also pled guilty and received a similar sentence. She, too, could have been hit with much harsher penalties – including up to 15 years behind bars. Although the judge did let the Nigerian-born Njoku off relatively easily, he had harsh words for the defendant: “You should be ashamed… you don’t have the excuse [of a poor upbringing] that many of the defendants who come before me have…the good deeds [you] have done are eviscerated by the nefarious deeds committed.”