Taking Advantage of Kids


Finding adequate and appropriate daycare is difficult for any parent, including beneficiaries who rely on Medicaid to subsidize payments to childcare programs. Once an appropriate childcare provider is found, parents don’t usually expect to have the identities of their children stolen, and they certainly don’t think the personal information would be used to bill Medicaid for services that were not provided. An article in the Shelby Star reports on a childcare provider who did just that, and bilked the Medicaid program of $8 million.

The article states that the operator of one childcare program in North Carolina participated in a massive scheme to bill Medicaid, using the stolen identities of the children enrolled in her after-school program. (The woman accomplished the scam by enticing junior beneficiaries to sign up for the program with the promise of a free price tag, compliments of Medicaid.) Once enrolled, the fraudster and another co-conspirator stole the Medicaid recipient numbers and billed for services that were never provided.

The woman also conspired with a licensed professional counselor, who was already enrolled with the North Carolina Medicaid program. (The plot thickens.) The counselor submitted claims for mental and behavior health services that were never provided to the after-school program enrollees. The counselor co-conspirator split the Medicaid payments for the bogus claims in half with the childcare program operator.

The childcare provider pleaded guilty to health care fraud, aggravated identity theft and filing false tax returns. She will serve approximately nine years in prison and will pay more than $7 million in restitution to Medicaid and nearly $600,000 to the Internal Revenue Service. Her co-conspirator, who operated a similar scheme in two nearby locations, received an eight-and-a-half year prison sentence. The counselor was sentenced to six years in prison for her part in claiming $6.1 million from Medicaid. (The article states she had quite a spending habit and used the illegally acquired benefits to buy vehicles, an RV and more than half a million dollars in jewelry.)

The real victims in this case are the children, who have already had a rough start in life, without the added trouble of criminals who want to take advantage of their situation. (Kudos to the judge in this case who doled out substantial punishment.) This fraud trio will no longer be allowed to steal benefits from those who deserve a better future.

Source: Today’s ”Fraud of the Day” is based on an article entitled ”Shelby Woman Sentenced to 9 Years for $8M Medicaid Fraud” published in the Shelby Star on April 10, 2014.

A Shelby woman who used the Medicaid information of children and families in her childcare programs to defraud Medicaid of $8 million in 2012 was sentenced Wednesday, along with her co-conspirator, Rodnisha Sade Cannon, of Charlotte.

Victoria Finney Brewton, of Shelby, was involved in a massive scheme that used stolen identities to claim millions of dollars, a scheme run by Linda Smoot Radeker, the wife of a former Cleveland County assistant district attorney.

Read More

Previous articleCaught in the Act
Next articleFraudulent Operation
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.