Fraud from A to Z

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The president and owner of the A to Z Pharmacy in New Port Richey, Florida used his business as a cover for a massive compounding pharmacy fraud scheme that stole more than $100 million from private insurance companies, Medicare and TRICARE. The healthcare fraud scheme which ran for just over three years, involved seven other individuals who have all previously pleaded guilty to their roles. (I guess they saved the worst – the mastermind – for last.)

 The pharmacy owner concocted his multimillion dollar scam using drug compounding, then fraudulently billed a variety of insurance programs. Pharmacists or physicians compound various drugs to create medication to help a patient with a specific problem. (In this case, the pharmacist oversaw the production of pain and scar creams.)

The pharmacist used the six pharmacies he owned and operated plus various shell companies that he and his co-conspirators propped up to hide the $100 million scam. (In addition to A to Z Pharmacy, the pharmacist also used three pharmacies in Miami and another two in Hialeah.) These companies were used to submit false and fraudulent reimbursement claims for prescription compounded medications. The mastermind admitted that he and his co-conspirators manipulated the billing codes in the reimbursement claims and submitted claims for pharmaceutical ingredients they did not have.

The ruse included a physician who signed prescriptions for patients he never saw. The pharmacist and his co-conspirators regularly paid kickbacks and bribes to increase the amount of prescriptions they processed. (They also paid for patients’ personal information to increase participation in their illegal plan.) The owner of the A to Z Pharmacy paid out proceeds from his fraudulent operation to co-conspirators by wire transfer, purchase of assets, or via checks. (Some of the assets purchased included property, antique cars and a cigarette racing boat. In total, assets seized were valued at $7.6 million.)

The 45-year-old pharmacy owner pleaded guilty to one count of conspiracy to commit healthcare fraud and one count of conspiracy to engage in monetary transactions involving criminally derived property. He is facing 15 years in prison when sentenced.

The criminal’s seven co-conspirators that previously pleaded guilty to healthcare fraud are between the ages of 48 and 71 and hailed from Boca Raton, Fort Lauderdale, New Port Richey and Parkland. (Sounds like this Florida fraud club will no longer be enjoying their 1964 Corvette, 1967 Camaro, 1970 Monte Carlo, 2008 Lamborghini convertible, multiple luxury properties or racing boat.)

Today’s fraudster was well-versed in the ABC’s of fraud, so typical of those who carryout similar schemes. The New Port Richey, Florida fraudster AVOIDED his responsibility to carry out his duties as a pharmacist with BRAZEN lies and COLLUSION amongst co-conspirators. Thankfully, the Medicare Strike Force has brought this crime spree to an end. My guess is that the Justice Department will ZEALOUSLY ZAP this criminal and his co-conspirators with a sentence they will not soon forget.

Today’s “Fraud of the Day” is based on a Department of Justice press release entitled, “Owner of Florida Pharmacy Pleads Guilty in $100 Million Compounding Pharmacy Fraud Scheme; Real Properties, Cars and a 50-Foot Boat Will Be Forfeited,” released on November 6, 2017.

The president and owner of a Florida pharmacy that was at the center of a massive compounding pharmacy fraud scheme, which impacted private insurance companies, Medicare and TRICARE, pleaded guilty today for his role in the scheme.  Seven other individuals have previously pleaded guilty in connection to the scheme.  Various real properties, cars and a 50-foot boat will be forfeited as part of the guilty pleas.

Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division, Acting U.S. Attorney W. Stephen Muldrow of the Middle District of Florida, Special Agent in Charge Eric W. Sporre of the FBI’s Tampa Field Office, Special Agent in Charge Robert F. Lasky of the FBI’s Miami Field Office, Special Agent in Charge Shimon Richmond of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Miami Regional Office and Resident Agent in Charge Brooke Harris of the U.S. Defense Criminal Investigative Service’s (DCIS) Tampa Regional Office made the announcement.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.