Fraud After Fraud

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Cropped shot of a doctor talking to a senior patient in a clinic

It takes chutzpah to try and pull off a $2.2 million Medicare fraud scheme; it takes chutzpah and a big old dose of dumb to do it while you’re awaiting sentencing for another series of Medicare crimes. David Brock Lovelace, a Florida marketing company owner, concocted a series of complicated healthcare fraud schemes that began in 2010, stretched through 2014—and ultimately got him more than 20 years in prison.

From 2010 to 2014, Lovelace and several co-conspirators used three Florida clinics to submit fraudulent radiology, neurology, audiology and cardiology claims to Medicare, using fake documents and making claims for medical services that weren’t delivered. Medicare paid more than $2.8 million in reimbursements for nearly $12.4 million in fraudulent claims. After being charged in May 2014 with health care fraud and money laundering, Lovelace was released on bond and ordered not to commit crimes or engage in any healthcare-related occupation. (Doh!)

That warning was a little too late, as Lovelace had already begun another elaborate hoax in November 2013. He initially paid cash bribes to Miami clinics in return for DNA swabs and referrals for expensive, unneeded DNA testing that was billed to Medicare. (The clinics offered patients food and other incentives to draw them in, while Lovelace received kickbacks from the testing labs.)

The Floridian’s May 2014 arrest led him to establish several shell marketing healthcare companies and recruit others to help him continue this scheme—while he was out on pretrial release for the first scheme. He continued the DNA scam until November 2014, when he was arrested on earlier charges.

In December 2015, Lovelace was found guilty of conspiracy, health care fraud, money laundering and aggravated identity theft. He was sentenced to serve 14 years in prison and pay more than $2.5 million in restitution—all for the first Medicare fraud scheme. In July 2019 he was tried for the Florida DNA scheme and found guilty of conspiracy to defraud the United States, illegal health care kickbacks, and structuring cash withdrawals to avoid reporting requirements. That got him a sentence of 70 months—to be served consecutively with his 14-year sentence. (They better keep a very close eye on him. It’s hard to tell what he might do next.)

Today’s Fraud of the Day comes from a U.S. Department of Justice media release, “Owner of Tampa-Area Medical Marketing Company Sentenced to Prison for DNA Testing Fraud Scheme,” published Oct. 4, 2019.

The owner of a Tampa, Florida-area medical marketing company was sentenced to 70 months in prison today for his role in a $2.2 million Medicare fraud scheme involving the payment of kickbacks and bribes to fraudulent medical clinics in Miami in exchange for the referral of Medicare beneficiaries for expensive genetic tests that were medically unnecessary, and for his role in the illegal structuring of cash withdrawal transactions.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Maria Chapa Lopez of the Middle District of Florida, Special Agent in Charge Michael McPherson of the FBI’s Tampa Field Office and Assistant Inspector General Omar Perez of the U.S. Department of Health and Human Services Office of the Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.

Additional information is available from a JD Supra article, “Owner of Medical Marketing Company Found Guilty in $2 Million Medicare Fraud Scheme…Again!” published Jul. 15, 2019.

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.