Pharmacy Owners Plead Guilty to COVID Fraud and Money Laundering Scheme

Pharmacy Owners Plead Guilty to COVID Fraud and Money Laundering Scheme

Two New York men pled guilty for their alleged involvement in a complex money laundering conspiracy to launder proceeds from a fraudulent health care scheme, which involved the submission of false and fraudulent claims to Medicare through New York area pharmacies that the men and their co-conspirators owned and controlled.

The men used the pharmacies to submit millions of dollars in fraudulent claims to Medicare, including by using COVID-19 billing codes to submit claims for expensive cancer treatments that were not actually provided. They then allegedly used shell companies to conceal their criminal proceeds, which totaled over $18 million. According to the government, the men are alleged to have generally sent their proceeds from pharmacy bank accounts they owned to sham pharmacy wholesale companies. The monies were then sent to: (1) companies in China for distribution to persons in Uzbekistan; (2) the defendants’ relatives or designees; or (3) directly to the defendants, who then purchased real estate and luxury items. 

Read DOJ’s press release here.

Pennsylvania Psychiatrist Charged with Fraudulent Medicare Billing Scheme 

A Lehigh Valley psychiatrist, who is the sole owner of Blue Mountain Psychiatry, was charged with four counts of healthcare fraud. According to the US Department of Justice’s (DOJ) press release, the licensed psychiatrist improperly and fraudulently billed Medicare for services that were not provided at all as well as services that were not provided at the level claimed. Specifically, the psychiatrist is alleged to have billed Medicare for: (i) more than 24 hours’ worth of services on a single day; (ii) treating the same patient at the same time at different nursing homes; and (iii) treating the deceased beneficiaries. The government alleges that Blue Mountain received Medicare payments of at least $1.36 million as a result of the fraudulent claims.

Read DOJ’s press release here.

Guilty Plea in Department of Veteran Affairs Scuba Fraud Investigation 

The Director of Training and School Certifying Official at a dive shop in Georgia became the sixth defendant to plead guilty to submitting false claims to the US Department of Veteran Affairs (VA). According to DOJ’s press release, the individual caused more than $700,000 in false claims to be paid out through the submission of false and fraudulent information to the VA. The other defendants who previously pled guilty include owners and employees at the dive shop and another scuba shop. Collectively, the defendants are alleged to be responsible for defrauding more than $6 million from VA education benefits. 

Read DOJ’s press release here.

California Man Found Guilty of Health Care Fraud and Prescription Drug Diversion Scheme 

A California man was convicted by a federal jury of conspiracy to commit health care fraud, health care fraud, and conspiracy to engage in the unlicensed wholesale distribution of prescription drugs. According to DOJ’s press release, in 2016 and 2017 the defendant used beneficiary information received from his co-conspirators to write false and fraudulent prescriptions for expensive prescription medications. These claims were then allegedly submitted to Medicare and Medicaid of California by a co-conspirator’s pharmacies, and the defendant’s co-conspirators then sold the medications on the black market. 

Read DOJ’s press release here.