Intercepting Fraud


Interceptions are good if you are rooting for the losing team who catches a misdirected pass with five seconds to go and runs the ball 90 yards for a touchdown that wins the game. A press release from the Department of Justice details how two fraudsters intercepted billing statements from Medicare beneficiaries, preventing them from knowing that they were being billed for services that were not needed nor provided. (It’s a given that no one wins at this type of game.)

The press release states that the two perpetrators were actually the owner and operator of a mental health center in La., and a patient recruiter from a related facility in Texas. Together, the two filed thousands of false claims amounting to $258 million in bills for mental health services that were not needed or ever provided. The scheme included kickbacks, falsified medical records and fake bills.

Three community mental health centers were involved in the investigation by the Medicare Strike Force, resulting in a total of 17 convictions of former therapists, marketers, administrators and owners, as well as the medical director. The scheme, which lasted for seven years, involved the co-owner of the La., facility, who also arranged for Medicare-eligible patients to be referred to one of the centers for partial hospitalization program services that were not needed.

The 53-year-old woman carried out her scam by instructing other managers, administrators and therapists to fake patient treatment records in order to increase the amount of money received from Medicare. (She also went as far as to intercept billing statements from the patients’ mail to prevent them from seeing the services that had been billed in their name.)

A patient recruiter in Texas was paid $1,500 in cash each week to refer Medicare-eligible beneficiaries to the partial hospitalization program. The 49-year-old man then paid the patients $75 to attend the unnecessary program. In order to make sure the patients qualified for admittance to the program, he also instructed the patients on how to talk to physicians about the types of symptoms experienced and diagnoses received.

The defrauding duo was found guilty following a six-day jury trial. The co-owner was found guilty of conspiracy to commit health care fraud and two counts of health care fraud. The patient recruiter was convicted of conspiracy to commit health care fraud and conspiracy to pay and receive health care kickbacks.

The criminals in this health care fraud scheme carried the fraud ball down the field for a pretty long drive before the Medicare Strike Force intercepted their devious scheme. Unfortunately, in this game, there were no winners. (The benefits program lost millions of dollars and many Medicare beneficiaries were victimized.) Kudos to the investigators who collaborated to defeat this losing team of criminals.

Source: Today’s ”Fraud of the Day” is based on a press release titled, ”Owner and Recruiter for Louisiana and Texas Mental Health Clinics Convicted as part of $258 Million Health Care Fraud Scheme in Baton Rouge, Louisiana,” released by the Department of Justice on May 22, 2014.

An owner and operator of community mental health centers in Baton Rouge, Louisiana, as well as a patient recruiter for a related facility in Houston, Texas, were convicted on Wednesday, May 21, 2014, for their roles in a $258 million Medicare fraud scheme involving three facilities that filed fraudulent claims for psychiatric services that were unnecessary or never actually provided.

Acting Assistant Attorney General David A. O’Neil of the Justice Department’s Criminal Division, U.S. Attorney Walt Green for the Middle District of Louisiana, Special Agent in Charge Michael J. Anderson for the FBI’s New Orleans Field Office, Special Agent in Charge Mike Fields for the Dallas Region of the Department of Health and Human Services (HHS) Office of Inspector General and Louisiana State Attorney General James Buddy Caldwell made the announcement.

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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.