Justia White Collar Crime Opinion Summaries

Tasis and his brother ran a sham medical clinic, recruited homeless Medicare recipients who had tested positive for HIV, hepatitis or asthma, paid the “patients” small sums in exchange for their insurance identification, then billed Medicare for infusion therapies that were never provided. During four months in 2006, the Center billed Medicare $2,855,785 and received $827,000 in return. The scheme lasted 15 months, during which Tasis and his collaborators submitted $9,122,159.35 in Medicare claims. An auditor notified the FBI. After an investigation, prosecutors indicted Tasis on fraud and conspiracy claims. Over Tasis’s objection, co-conspirator Martinez testified that she and Tasis had orchestrated a a similar scam in Florida. The court instructed the jury to consider Martinez’s testimony about the Florida conspiracy only as it related to Tasis’s “intent, plan and knowledge.” The jury found Tasis guilty, and the trial judge sentenced him to 78 months in prison and required him to pay $6,079,445.93 in restitution. The Sixth Circuit affirmed, rejecting various challenges to evidentiary rulings. View "United States v. Tasis" on Justia Law

Semrau, a Ph.D. in clinical psychology, owned companies that provided psychiatric care to nursing home patients in Tennessee and Mississippi, using contracting psychiatrists who submitted records describing their work. The companies then billed the services to Medicare or Medicaid through private insurance carriers. Services are categorized into five-digit Current Procedural Terminology Codes, published by the American Medical Association. The Centers for Medicare and Medicaid Services sets reimbursement levels for each code as well as “relative value units” corresponding to the amount of work typically required for each service. After audits indicated that the companies had been billing at a higher rate than could be justified by the services actually performed, “upcoding,” Semrau was convicted of healthcare fraud, 18 U.S.C. 1347, and was sentenced to 18 months of imprisonment and ordered to pay $245,435 in restitution. The Sixth Circuit affirmed, rejecting Semrau’s claim that results from a functional magnetic resonance imaging lie detection test should have been admitted to prove the veracity of his denials of wrongdoing. There was ample evidence that Semrau was aware of accepted definitions of the CPT codes; he expressly agreed not to “submit claims with deliberate ignorance or reckless disregard of their truth or falsity.” View "United States v. Semrau" on Justia Law

Venti’s father received federal Civil Service Retirement System benefits. Venti’s father died in 1990, which should have terminated his benefits. The Office of Personnel Management continued to deposit the CSRS funds into a checking account that Venti had shared with his father. In 2003, Venti opened a new joint checking account at RFCU in the names of himself and his father and arranged for the CSRS benefits, as well as his own Social Security benefits, to be deposited in the new account. In 2005, OPM learned of the death of Venti's father and stopped depositing the CSRS benefits. In 2009, Venti was convicted of theft of government property (18 U.S.C. 641), one count for each of nine checks written in his father’s name during 2005, and was sentenced to 15 months. The First Circuit affirmed, rejecting an argument that one count was time-barred. If the count had been time-barred, the sentence would have been limited to one year because Venti would be treated as a misdemeanant rather than as a felon. View "United States v. Venti" on Justia Law

The owner of supermarkets involved his family in a scheme to provide cash for food stamps, beyond what is permitted by Puerto Rico law. A conservative estimate put receipts from the fraud above $4 million, which was intermingled with more than $20 million in food stamp proceeds. Family members testified and he was convicted of conspiracy to commit food stamp fraud, 7 U.S.C. 2024(b) and 18 U.S.C. 371, and for knowingly conducting and attempting to conduct financial transactions affecting interstate commerce involving the proceeds of unlawful activity, 18 U.S.C. 1956(a)(1)(A)(i) and 1956(a)(1)(B)(i), and 2, sentenced to 108 months in prison, and ordered to forfeit $20 million. The First Circuit affirmed. The district court properly applied a sentencing enhancement for the owner's leadership participation in the scheme. Even legitimate funds are subject to forfeiture when they become involved in a scheme to conceal illegal funds. The court properly weighed the harm caused by the crime. View "United States v. Aguasvivas-Castillo" on Justia Law

Defendant operated what appeared to be convenience stores, but in fact were fronts that rang up phony sales for food-stamp recipients to exchange their benefits for discounted amounts of cash. When federal investigators discovered the scheme at one location, he obtained government authorization to accept food stamps at a different address and continued the operation. Defendant eventually pleaded guilty to eight counts of wire fraud, 18 U.S.C. 1343, and was sentenced to 60 months' imprisonment and ordered to pay almost $1.7 million in restitution. The Seventh Circuit affirmed. The district court properly imposed a 16-level sentencing increase under 2B1.1(b)(1)(I) for a loss of more than $1 million because. If anything, the court underestimated the loss. The court properly assessed a 4-level increase under 3B1.1(a) for leadership in an "extensive" scam; defendant ran the scam from multiple locations, traded cash for benefits with "probably hundreds" of customers, and supervised employees at his stores. View "United States v. Hussein" on Justia Law

Doctors filed suit, alleging violations of the False Claims Act, 31 U.S.C. 3279 and the Michigan Medicaid False Claim Act, as qui tam relators on behalf of the United States/ The claimed that the business defrauded the government by submitting Medicare and Medicaid billings for defective radiology studies, and that the billings were also fraudulent because the business was an invalid corporation. The federal government declined to intervene. The district court dismissed. Sixth Circuit affirmed. The doctors failed to identify any specific fraudulent claim submitted to the government, as is required to plead an FCA violation with the particularity mandated by the FRCP. A relator cannot merely allege that a defendant violated a standard (in this case, with respect to radiology studies), but must allege that compliance with the standard was required to obtain payment. The doctors had no personal knowledge that claims for nondiagnostic tests were presented to the government, nor do they allege facts that strongly support an inference that such billings were submitted.View "Chesbrough v. VPA, P.C." on Justia Law

Ernestine Girod, Una Favorite Brown, and Melinda Langley were each indicted on one count of conspiracy and multiple counts of healthcare fraud, and Brown and Girod were charged with three counts each of making false statements to law enforcement officers, all in relation to fraudulent Medicaid reimbursement claims made through A New Beginning of New Orleans, a Medicaid Early Periodic Screening Diagnosis and Treatment organization that provided minor, disabled Medicaid recipients with Personal Care Services. A jury convicted defendants on all but three of Langley's healthcare fraud counts. Brown, Girod, and Langley separately appealed their convictions and sentences on various grounds. The court discussed Brown's motion to dismiss the indictment due to prosecutorial misconduct; the sufficiency of the evidence supporting Girod's convictions; Girod's sentencing enhancements; and testimony of Langley's other acts. Accordingly, the court held that all the convictions and sentences were affirmed.

Martin J. Bradley III and his father, Martin J. Bradley, Jr. (collectively, the Bradleys), owned Bio-Med Plus, Inc. (Bio-Med), a Miami-based pharmaceutical wholesaler that purchased and sold blood-derivatives. This case stemmed from multiple schemes to defraud the Florida and California Medicaid programs by causing them to pay for blood-derivative medications more than once. The Government chose to prosecute the schemes and a grand jury indicted eight individuals, including Albert L. Tellechea, and two companies, Bio-Med, and Interland Associates, Inc. The Bradleys, Bio-Med, and Tellechea subsequently appealed their convictions and raised several issues on appeal. The court affirmed the Bradleys', Bio-Med's, and Tellechea's convictions, and Bradley III's and Bio-Med's sentences. The court vacated Bradley, Jr.'s sentences on Counts I and 54 and Tellechea's sentence on Count 3, and remanded those counts for resentencing. The court reversed the district court's October 4, 2006 order appointing the receiver and monitor, and its supplemental receivership order of May 17, 2007. The court finally held that, as soon as circumstances allowed, the receivership should be brought to an immediate close.