You Scratch My Back, I’ll Scratch Yours

Medical insurance application, silver pen and stethoscope. Legal law contract and health insurance concepts.

There was a lot of back scratching going on at the Cleveland VA Medical Center between October 2010 and January 2019, thanks to William H. Precht, 54, of Kent, Ohio. Precht used his position as an Inventory Management Specialist, and later as a Supervisory Management and Program Analyst at the facility, to participate in a bribery and kickback scheme that caused a loss of nearly $200,000.

Through his position at the Cleveland VA Medical Center, Precht ordered medical supplies, purchased capital equipment, and monitored equipment purchase requests. This gave him the perfect opportunity to use his VA employee log-in credentials to register a purported vendor (Vendor-1), a Small Disadvantaged Business and Veteran-Owned Small Business in the VA vendor system. 

Precht used his VA purchase card, as well as other employee cards, to buy medical supplies totaling $1,066,348 from Vendor-1. (In addition to scratching his own back here, he also scratched the back of a business associate in exchange for some referral kickbacks.) Over approximately four years, Precht conspired with Robert A. Vitale, a medical sales representative for several companies that conducted business with the Cleveland VA, to receive kickbacks in exchange for steering VA business to Vitale.

Precht attempted to conceal what he was doing by providing false and misleading information to the VA regarding the procurement of medical supplies and fake patient records. (He was trying to make it look like patients needed the medical supplies, when they did not.)

Precht pleaded guilty to a 28-count indictment charging him with theft of government property, conspiracy to commit wire fraud and honest services fraud, wire fraud and false statements relating to health care matters. His co-conspirator, Vitale, pleaded guilty to a Bill of Information for his role in the healthcare scheme. (A perfect example of public corruption that diverted taxpayer dollars intended for U.S. veterans.)

Today’s Fraud of the Day comes from a Department of Justice press release, “Former Cleveland VA Medical Center Supervisor Sentenced to 37 Months and Ordered to Pay More Than $1.25 Million in Restitution for Theft and Kickback Scheme,” dated October 14, 2021.

Acting U.S. Attorney Bridget M. Brennan announced that William H. Precht, 54, of Kent, Ohio, was sentenced today by Judge Donald C. Nugent to 37 months imprisonment and ordered to pay $1,259,390.66 in restitution after Precht pleaded guilty to theft of government property and participating in a bribery and kickback scheme that enriched himself and caused the Cleveland VA Medical Center to suffer a loss of nearly $200,000.

Precht pleaded guilty in March of 2021 to a 28-count indictment charging him with theft of government property, conspiracy to commit wire fraud and honest services fraud, wire fraud and false statements relating to health care matters.

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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.