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NAVIGATION

November 17, 2018

Press Release

Southern District of Florida Charges 124 Individuals Responsible

Largest National Health Care Fraud Enforcement Action in Department of Justice History Resulted in Total of 76 Doctors Charged and 84 Opioid Cases Involving More Than 13 Million Illegal Dosages of Opioids

| 6/29/2018

The following agents, attorneys, officers and officials have announced that in the Southern District of Florida, a total of 124 defendants were charged with offenses relating to their alleged participation in various fraud schemes involving over $337 million in false billings for services including home health care, substance abuse treatment, lab testing, and pharmacy fraud. Those making the announcement are:

Benjamin G. Greenberg, U.S. Attorney for the Southern District of Florida; Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; Shimon R. Richmond, Special Agent in Charge, U.S. Department of Health & Human Services, Office of Inspector General (HHS-OIG), Miami Regional Office; John F. Khin, Special Agent in Charge, Department of Defense, Office of Inspector General, Defense Criminal Investigative Service (DCIS), Southeast Field Office; Brian Swain, Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office; Pam Bondi, Florida Attorney General (Florida Medicaid Fraud Control Unit); Michael J. DePalma, Acting Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI); Christopher Cave, Special Agent in Charge, U.S. Postal Service Office of Inspector General (USPS OIG), Southern Area Field Office; Frank Robey, Director, U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit; Scott Gottlieb, M.D., Commissioner, U.S. Food and Drug Administration (FDA); Jimmy Patronis, Florida Chief Financial Officer, Division of Investigative and Forensic Services (DIFS); Tom Howard, Inspector General, Amtrak Office of Inspector General (Amtrak-OIG); Isabel Colon, Atlanta Regional Director, U.S. Department of Labor’s Employee Benefits Security Administration (DOL-EBSA); Norbert E. Vint, Acting Inspector General, U.S. Office of Personnel Management, Office of Inspector General (OPM-OIG); and Dennis Russo, Director of Operations, National Insurance Crime Bureau (NICB),

The South Florida charges are part of the largest ever national health care fraud enforcement action by the Medicare Fraud Strike Force.  Attorney General Jeff Sessions announced today that more than 601 defendants were charged, across 58 federal districts, including 76 doctors, as well as nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $2 billion in false billings. Of those charged, over 162 defendants, including doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests.  In addition, HHS announced today that from July 2017 to the present, it has excluded 2,700 individuals from participation in Medicare, Medicaid, and all other Federal health care programs, which includes 587 providers excluded for conduct related to opioid diversion and abuse.

The charges announced today aggressively target schemes billing Medicare, Medicaid, TRICARE (a health insurance program for members and veterans of the armed forces and their families), and private insurance companies for medically unnecessary prescription drugs and compounded medications that often were never even purchased and/or distributed to beneficiaries. The charges also involve individuals contributing to the opioid epidemic, with a particular focus on medical professionals involved in the unlawful distribution of opioids and other prescription narcotics, a particular focus for the Department of Justice (DOJ). According to the CDC, approximately 115 Americans die every day of an opioid-related overdose. 

According to court documents, the defendants allegedly participated in schemes to submit claims to Medicare, Medicaid, TRICARE, and private insurance companies for treatments that were medically unnecessary and often never provided. In many cases, patient recruiters, beneficiaries and other co-conspirators were allegedly paid cash kickbacks in return for supplying beneficiary information to providers, so that the providers could then submit fraudulent bills to Medicare for services that were medically unnecessary or never performed. Collectively, the doctors, nurses, licensed medical professionals, health care company owners and others charged are accused of submitting a total of over $2 billion in fraudulent billings.  The number of medical professionals charged is particularly significant, because virtually every health care fraud scheme requires a corrupt medical professional to be involved in order for Medicare or Medicaid to pay the fraudulent claims.  Aggressively pursuing corrupt medical professionals not only has a deterrent effect on other medical professionals, but also ensures that their licenses can no longer be used to bilk the system.

“Today’s takedown sends a clear message that those who steal our tax dollars and divert money from much needed government programs to line their own pockets will be brought to justice,” stated U.S. Attorney Benjamin Greenberg.  The same is true of those individuals who facilitate these crimes by enabling the perpetrators to financially benefit from their misdeeds.  The South Florida based schemes involved hundreds of millions of dollars in fraud, and in some cases resulted in significant harm to patients in need of substance abuse treatment. When that treatment is withheld because of someone’s greed, the very people who are supposed to help the addicts end up enabling their addiction.  Side by side with our great partners, we will continue to fight against all forms of healthcare fraud in South Florida.” 

“Health care fraud and opioid abuse are threats to this country, both in terms of the well-being of patients and the viability of government health care programs,” said Shimon R. Richmond, Special Agent in Charge, HHS-OIG.  “This takedown sends a clear message that criminals who engage in health care fraud schemes and illicit opioid distribution will be caught.  Working collaboratively with our state and federal partners, we will continue to bring these criminals to justice.”

John F. Khin, Special Agent in Charge, DCIS-Southeast Field Office, stated, “As part of the National Health Care Fraud multi-agency joint effort, the DCIS-Southeast Field Office contributed significant resources and efforts to achieve a successful operation to effectively combat widespread fraud and abuse, and preserve the integrity of TRICARE, a vital DoD program serving U.S. service members, retirees, and their families.”

“Health care fraud costs taxpayers billions of dollars, increases medical costs and even helps fuel the national opioid crisis,” stated Florida Attorney General Pam Bondi.  “Our law enforcement partners and my Medicaid Fraud Control Unit aggressively investigate fraud in Florida, and as part of this massive nationwide effort, we were able to arrest some of the worst offenders and stop the illegal sale of prescription opioids—and hopefully safe lives.”

“Today’s local announcement reinforces law enforcement’s continued commitment to combat healthcare fraud in South Florida. IRS-CI is proud to participate in these cases and be part of the Greater Palm Beach County Health Care Fraud Task Force where we can provide our expertise to conduct financial analysis and unravel the complex financial transactions involved in these fraudulent schemes. IRS-CI will continue to allocate resources to fight the battle against healthcare fraud and will investigate individuals who are committing crimes while motivated by greed,” stated Michael J. DePalma, Acting Special Agent in Charge, IRS-CI.               

“This historic announcement marks a significant effort by the National Healthcare Fraud Takedown task force and should send a clear message that these crimes will not be tolerated,” said Special Agent in Charge, Christopher Cave, USPS OIG.  “The USPS Office of Inspector General, along with our law enforcement partners, will continue to aggressively pursue these investigations in order to ensure continued oversight and protection of the Postal Service and federal benefits programs.” 

“We applaud the coordinated efforts of our federal law enforcement partners in this action today.  The FDA is proud to play a role in supporting these investigations,” said U.S. Food and Drug Administration Commissioner Scott Gottlieb, M.D. “A key aspect of the FDA’s mission to protect public health is creating a regulatory framework that helps ensure that compounded drugs are dispensed to patients who have a legitimate medical need for them.”

“Insurance fraud has seeped into our opioid treatment homes in Florida, impacting countless families and communities,” said CFO Jimmy Patronis. “The collaborative efforts of national, state and local law enforcement are essential for combatting this type of activity. My office, along with the U.S. Attorney’s Office for the Southern District of Florida and our law enforcement partners remains committed to safeguarding Floridians while reminding those who seek to deceive and defraud – they will be held accountable for their actions.” 

“These cases reinforce our commitment and determination to pursue those who would defraud Amtrak’s health care programs and target such vulnerable populations,” said Amtrak Inspector General Tom Howard. “Our agents will continue to hold perpetrators accountable and to protect Amtrak, its employees and their dependents.”

“Today’s announcement is a reflection of federal, state, and local partners joining forces to root out fraud and abuse in the healthcare system,” said Atlanta Regional Director for DOL-EBSA Isabel Colon. “The department will continue to take all actions necessary to put a stop to those who would defraud workers and their families of hard-earned employee benefits.”

“The OPM-OIG will continue to work with the Department of Justice and our other law enforcement partners to protect the integrity of the Federal Employees Health Benefits Program and ensure that Federal employees, annuitants, and their families receive unbiased medical care from ethical professionals,” said Norbert E. Vint, Acting OPM Inspector General.

The following are some of the recent health care fraud cases that have been charged in the Southern District of Florida:

I. SUBSTANCE ABUSE TREATMENT FRAUD AND ILLEGAL DISTRIBUTION OF OPIOIDS

The U.S. Attorney’s Office for the Southern District of Florida continues to partner with federal, state and local law enforcement agencies and the Greater Palm Beach Health Care Fraud Task Force (“Task Force”) to target fraud and other criminal practices in the substance abuse treatment/medical industry, including: money laundering; billing for treatment and laboratory testing that was not actually provided and not medically necessary; submission of claims that were solicited through the payment of kickbacks and bribes to patients, sober home owners, and treatment center owners; and the illegal distribution of opioids.  To date, at least 34 individuals have been charged federally, 19 have been convicted, $20,292,916.37 in restitution has been ordered, and more than $4 million in restitution has been collected.  

A.  Health Care Fraud and Money Laundering

1. United States v. Kenneth Bailynson, et al.,

Case No. 18-80124-CR-Rosenberg

On June 22, 2018, Kenneth Bailynson, 45, of West Palm Beach, Florida, owner of GDSL, Inc., a/k/a Good Decisions Sober Living, Inc. (“GDSL”) in West Palm Beach, Stephanie Curran, 35, of Lake Worth, Florida, an employee of GDSL, Mark Agresti, 55, of Palm Beach, Florida, the Medical Director of GDSL, and Matthew Noel, 32, of Louisville, Kentucky, an employee of GDSL, were charged by indictment.  The defendants were charged with conspiracy to commit health care and wire fraud, substantive counts of health care fraud, and substantive counts of money laundering for their involvement in a scheme at GDSL to illegally recruit patients, pay kickbacks, and defraud health care benefit programs by billing for widespread fraudulent urine testing that was not medically necessary.  The indictment alleges that during the course of the fraudulent scheme, from September 2011 through December 2015, GDSL submitted claims for substance abuse treatment services in excess of approximately $106,576,358 to the insurance plans, and received insurance payments of approximately $31,356,527. 

This case is being prosecuted by DOJ Trial Attorney James V. Hayes, formerly an Assistant U.S. Attorney in the Southern District of Florida. 

2. United States v. Anthony Jackson,

Case No. 18-80040-CR-Middlebrooks

On June 21, 2018, following his guilty plea to conspiracy to commit health care fraud, Anthony Jackson, 51, of Lantana, Florida, a Certified Addiction Counselor at Reflections Treatment Center in Margate, Florida and owner of Pantherview Sober Home in Boynton Beach, Florida was sentenced to 42 months in prison, to be followed by 3 years of supervised release.  Jackson also was ordered to pay $5,122,886.86 in restitution.

The case is being handled by Assistant U.S. Attorneys A. Marie Villafaña and Alexandra Chase.

3. United States v. Eric Snyder, et al.,

Case No. 18-80111-CR-Rosenberg

On June 7, 2018, Eric Snyder, 31, of Delray Beach, Florida, an owner of Halfway There Florida, LLC/A Safe Place (“HWT”), a Delray Beach sober home, and Real Life Recovery Delray LLC (“RLR”), a substance abuse treatment facility, Paul R. Materia, 43, of Port St. Lucie, Florida, the CEO of RLR, and patient brokers Joseph Lubowitz, 29, of Pennsylvania and West Palm Beach, Florida, and Christopher Fuller, 33, of West Palm Beach, Florida, were charged by indictment. The defendants were charged with conspiracy to commit health care and wire fraud, substantive counts of health care fraud, substantive counts charging a violation of the Travel Act, conspiracy to commit money laundering, and substantive counts of money laundering for their involvement in a scheme to illegally recruit patients, pay kickbacks, and defraud health care benefit programs by billing for urine testing and substance abuse treatment that was medically unnecessary, and that was never provided.  During the course of the alleged fraudulent scheme, from January 2011 through September 2015, HWT/RLR submitted claims for substance abuse treatment services in excess of approximately $58,209,385 to insurance plans, and received insurance payments of approximately $20,190,941.  Eric Snyder and Christopher Fuller were previously charged with conspiracy to commit health care fraud in this case, in a criminal complaint filed in July 2017 (Case No.  17-MJ-08268-Brannon).

This case is being prosecuted by DOJ Trial Attorney James V. Hayes, formerly an Assistant U.S. Attorney in the Southern District of Florida.    

4. United States v. Mark Jeffrey Hollander,

Case No. 18-80102-CR-Rosenberg

On May 21, 2018, Mark Jeffrey Hollander, 44, of Miami, Florida, was charged by an information with laundering the proceeds of health care fraud, that is, monies he received from Smart Lab LLC, a clinical laboratory located in Palm Beach Gardens, Florida.

The case is being handled by Assistant U.S. Attorneys A. Marie Villafaña and Alexandra Chase

5. United States v. Lawrence Weisberg,

Case No. 18-80108-CR-Rosenberg

On May 29, 2018, Lawrence Weisberg, 51, of Boca Raton, Florida, was charged by an information with laundering the proceeds of health care fraud, that is, monies he received from Smart Lab LLC, a clinical laboratory located in Palm Beach Gardens, Florida.

The case is being handled by Assistant U.S. Attorneys A. Marie Villafaña and Alexandra Chase.

6. United States v. Lanny Fried,

Case No. 18-80100-CR-Rosenberg

On May 21, 2018, Lanny Fried, 41 of Miami, Florida, was charged by an information with conspiracy to commit money laundering of proceeds from health care fraud, that is, monies he and others received from Smart Lab LLC, a clinical laboratory located in Palm Beach Gardens, Florida.

The case is being handled by Assistant U.S. Attorneys A. Marie Villafaña and Alexandra Chase.

7. United States v. Bosco Vega,

Case No. 18-80101-CR-Middlebrooks

On May 22, 2018, Bosco Vega, 52, of Miami, Florida, was charged by an information with laundering the proceeds of health care fraud, that is, monies he received from Smart Lab LLC, a clinical laboratory located in Palm Beach Gardens, Florida.

The case is being handled by Assistant U.S. Attorneys A. Marie Villafaña and Alexandra Chase.

B. Illegal Distribution of Opioids

8. United States v. Arman Abovyan and Tina Marie Barbuto,

Case No. 18-80122-CR-Middlebrooks

On June 19, 2018, Arman Abovyan, 44, of Boca Raton, Florida, former Medical Director of Reflections Treatment Center in Margate and Journey to Recovery in Boca Raton, and Tina Marie Barbuto, 39 of Boca Raton, Florida, former Clinical Director of Reflections Treatment Center in Margate were charged by indictment with one count of conspiracy to distribute and dispense controlled substances outside the course of medical practice and two counts of distribution of controlled substances outside the course of medical practice. 

The case is being handled by Assistant U.S. Attorneys A. Marie Villafaña and Alexandra Chase.

9. United States v. Kenneth Rivera-Kolb,

Case No. 18-80121-CR-Cohn

On June 19, 2018, Kenneth Rivera-Kolb, 66, of Largo, Florida, was charged by indictment with one count of conspiracy to distribute controlled substances in relation to his employment with Angel’s Recovery, a substance abuse treatment facility located in Palm Beach County, Florida. Rivera-Kolb was a licensed physician in the State of Florida.  In 2013, he was hired as the Medical Director for Angel’s Recovery.  As the Medical Director of Angel’s Recovery, Rivera-Kolb prescribed controlled substances for patients.  From approximately February 17, 2015 through September 2, 2015, after the suspension of his medical license, Rivera-Kolb allegedly continued to prescribe controlled substances to patients of Angel’s Recovery.

The case is being handled by Assistant U.S. Attorneys A. Marie Villafaña and Alexandra Chase.

10. United States v. Scott Novick,

Case No. 18-20563-CR-Moore

On June 27, 2018, Scott Novick, 50, of Broward County, Florida, was charged by information with one count of conspiracy to dispense and distribute controlled substances.  According to the information, Novick was the owner of American Pain Management, a pain management clinic located in Tamarac, Florida.  He also owed Pacific Pharmacy, a Miami-area pharmacy.  Between July 2016 and March 2018, Novick allegedly engaged in a conspiracy to dispense and distribute Schedule II substances, including oxycodone and morphine. 

Mr. Greenberg commends the investigative efforts of the FBI and HHS-OIG.  This case is being prosecuted by DOJ Trial Attorney Timothy P. Loper.

Agencies involved with the Greater Palm Beach County Health Care Fraud Task Force include the FBI, IRS-CI, DIFS, Amtrak-OIG, DOL-EBSA, OPM-OIG, and NICB.  

Tags: Healthcare

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