Cooperation Goes A Long Way

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It’s always important to be cooperative when seeking leniency from the Judge. An article on Philly.com details the story of the former director and owner of a Philadelphia hospice center, who cooperated with federal prosecutors regarding his participation in fraud scheme that billed Medicare for more than $16.2 million in fraudulent claims.

The story describes the defendant as an ”exceptional cooperator.” He not only explained the roles of others involved in the scheme and identified fraud within and outside of his organization, but he also testified at two grand juries and three trials. (He certainly gets an A for effort.)

Over a five-year period, the 42-year-old and his co-owner split company profits. The defendant’s wife also participated in the scheme while serving as the development executive at the hospice center. (Where there is fraud, there are usually co-conspirators, as well.)

The defendant’s cooperative efforts and testimonies from his family regarding his character were helpful in reducing his sentence. Although the man pleaded guilty to conspiracy to commit health care fraud, he stated that it was not his intention to defraud the country that he had come to at age 19 from Ukraine. The Judge, although persuaded by his testimony, felt it necessary to punish him for his involvement in this massive scheme. The former hospice center owner will serve two years and nine months in prison and will be ordered along with others to pay $16.2 million in restitution. He will also be required to surrender his nursing license.

The man’s co-owner was previously convicted by a jury for health care fraud, conspiracy to commit health care fraud, mail fraud and money laundering. He will serve 14 years and eight months in prison. (That’s a hefty sentence. I’m guessing he didn’t own up to his part in the scheme.) The defendant’s wife pleaded guilty to obstructing a federal audit and was sentenced to a year and a day in prison. The lawyer for both the defendant and his wife asked that the two sentences be staggered so that one parent can be at home with their children while the other is serving time in prison. (It remains to be seen just how the judge will respond to that request.)

This case is a reminder of how important it is to be honest when being prosecuted for fraud or any crime for that manner. This man took responsibility for his actions and although he will pay a price for his illegal activity, his punishment was greatly reduced. Let’s hope the message this case sends will go a long ways toward reducing the incidences of fraud and promoting cooperation.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Former Director of NE Philly Hospice Provider Sentenced in Medicare Fraud Scheme,” written by Julie Shaw and published by Philly.com on June 23, 2014.

A VETERAN federal prosecutor passionately told a judge yesterday that Alex Pugman, a leading defendant in a Medicare fraud case, “was without a doubt the most exceptional cooperator I have worked with.”

Pugman, who was the director and co-owner of the now-defunct Home Care Hospice in Northeast Philly, helped explain the roles of other participants in the scheme, pointed out the fraud in the agency’s records, and testified at two grand juries and at three trials, Assistant U.S. Attorney Suzanne Ercole said.

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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.