Spineless Fraudsters

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Stethoscope on 100 dollar bills symbolizing financial surveillance

The Department of Veterans Affairs (VA) provides monetary allowances, vocational training and rehabilitation, and VA-financed health care benefits to Korea and Vietnam Veterans’ birth children who have been diagnosed with spina bifida, a malformation of the vertebrae in the spine that exposes the spinal column.

Joseph Prince of Aurora, Colorado was one of two Case Management Liaisons for the VA’s Spina Bifida (SB) Health Care Benefits Program. Prince was able to gather information about health care providers and SB beneficiaries while he worked at a Denver call center. He then took this information and used it to commit healthcare fraud. (The irony is that Prince abused a position intended to serve those who served our country. Talk about spineless fraudsters.)

Prince asserted to families with loved ones suffering with SB that he could approve family members as home health care providers. All they had to do to be approved was sign up as contractors with specific home health agencies. (Prince made himself judge, jury, and executioner of those who became qualified for SB benefits.) These home health agencies were run by his friends and family members. His friends and family members would then approve the fraudulent claims the unqualified care providers submitted. (See where this is going?)

He previously had friends and family members open purported home health agencies despite the fact they did not have the proper credentials or medical expertise. About 45 SB beneficiaries registered as contractors with the fraudulent home health entities between 2017 to 2018. Over $20 million of fraudulent claims were submitted to the VA during that time.

Caregivers were instructed to falsely log the maximum number of hours that one can be reimbursed for medical service. He would then have the fraudulent home health companies keep 80 percent of the VA reimbursement and only provide the caregiver of the family member with SB the remaining 20 percent. (The fraudsters involved became rich while those in need of care were scammed.)

One of the faulty home health companies, which was owned by Prince’s wife, allowed the couple to jointly reap the monetary benefit of this healthcare fraud scam. He also earned $1.5 million in kickbacks from two of the other home health companies in exchange for encouraging SB caretakers to register as contractors with them.

Prince was sentenced to serve 16 years in federal prison for healthcare fraud, conspiracy, payment of illegal kickbacks and gratuities, money laundering, and conflict of interest charges.  Prince was also ordered to serve three years of supervised release and pay $18,777,134.68 in restitution to the Veteran’s Health Administration. (That’s a lot of money.)

Co-conspirators Roland Vaugn pled guilty to paying an illegal gratuity to a public official and Glenn and Catherine Beach each pleaded guilty to paying an illegal gratuity to Prince.

Today’s Fraud of the Day comes from a Department of Justice press release, “VA Employee Sentenced For Orchestrating $19 Million Corruption Scheme,” dated June 12, 2020.

DENVER – United States Attorney Jason R. Dunn announced that Joseph Prince, age 61, of Aurora, Colorado was sentenced yesterday to serve 192 months (16 years) in federal prison for health care fraud, conspiracy, payment of illegal kickbacks and gratuities, money laundering, and conflict of interest charges.  Prince was also ordered to serve 3 years of supervised release and pay $18,777,134.68 in restitution to the Veteran’s Health Administration.  Prince, who appeared at the sentencing hearing free on bond, was remanded at the hearing’s conclusion.

According to the indictment and evidence presented at trial, Prince was one of two Case Management Liaisons for the VA’s Spina Bifida (SB) Health Care Benefits Program.  The program covers the medical needs of children of certain veterans of the Korea and Vietnam wars with SB.  Acting as a subject matter expert working in a Denver call center, Prince spoke with health care providers and SB beneficiaries or their families regarding their health care needs and reimbursement for care under the program.

 

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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.