A $20 Million Lie

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

Dr. Richard Davidson, 42, of Florida has been sentenced to six years behind bars for conspiring with others to commit healthcare fraud. (Unfortunately, he is just one among many fraudsters who enjoy taking government healthcare benefits from those who truly need them.)

Davidson worked with co-conspirators to create a conglomerate of durable medical equipment (DME) supply companies. The group secured billing privileges by lying to Medicare. (Nothing is truly secure if its foundation is built on a lie.)

To conceal the true ownership, the companies were placed in the names of straw owners. The conspirators were able to secretly gain control of the companies, enabling them to submit a high volume of illegal DME claims. (Little did they know, the court would soon be in charge of determining their prison sentences.)

The conspirators used bribes and kickbacks to submit more than $20 million in illegal DME claims. “Marketers” generated claims by making them appear as “telemedicine” and doctors were bribed to sign the supportive orders.

This illegal scam caused Medicare and the Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA) to pay out $10 million within one year of the establishment of the fraudulent chain of companies.

Davidson pleaded guilty to Medicare fraud and has been sentenced to six years in federal prison. He must also forfeit $650,000 in funds traceable to the offense or as substitute assets.  The court ordered a $2.47 million money judgment and restitution of $10.72 million. (The court also took away Davidson’s medical license. Sounds like justice was served in the end.)

Today’s Fraud of the Day comes from a Department of Justice press release, “Former Delray Beach Doctor Sentenced to Six Years in Federal Prison For $20 Million Health Care Fraud Scheme,” dated July 26, 2021.

Tampa, Florida – U.S. District Judge William Jung has sentenced Dr. Richard Davidson (Delray Beach, 42) to six years in federal prison for conspiracy to commit health care fraud. As part of his sentence, the court ordered Davidson to forfeit approximately $650,000 in funds traceable to the offense or as substitute assets. The court also entered a money judgment of $2.47 million and ordered $10.72 million in restitution. Davidson lost his medical license due to his conviction.

Davidson had pleaded guilty on September 16, 2020.

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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.