All Work, No Comp 

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A Glendale, Calif., man was sentenced to five years in federal prison and ordered to pay a massive restitution fee for his involvement in a $250 million scam that defrauded the California Workers’ Compensation System. Sam Sarkis Solakyan, 40, who was the CEO of multiple medical imaging companies, including Vital Imaging Inc. and San Diego MRI Institute,  orchestrated a workers’ compensation fraud scheme that submitted bogus medical service claims. (His diagnostic imaging facilities, which spanned across California, gave him the perfect opportunity to carry out his deceptive plan.) 

As ringleader of this conspiracy, Solakyan created a cross-referral scheme and incentivized co-conspirators, including physicians, to refer patients to physicians who overprescribed ancillary services. (He rewarded these co-conspirators with cash bribes, kickbacks, and other incentives in exchange for patient referrals.) The conspirators concealed these bribes and kickbacks, going out of their way to create sham agreements, including contracts for so-called “marketing” and “administrative services”.

Solakyan’s recruiters required doctors to refer a minimum number of patients to receive the referrals. (Solakyan ran a tight ship and would stop the referrals immediately if these doctors didn’t hit their so-called quotas.) He paid almost $9 million in kickbacks (disguised by the sham contracts) in exchange for medical referrals, most of which were unnecessary orders for MRIs. Solakyan’s claims for fraudulent medical services procured through the payment of bribes and kickbacks totaled over $250 million. (Take a moment and just think about how much moolah that is.)

After an eight-day trial, Solakyan was found guilty of one count of conspiracy to commit honest services mail fraud and health care fraud, and 11 counts of honest services mail fraud. (Honest services refer to any form of bad conduct that deprives another of the intangible right of honest services.)

In addition to 60 months in federal prison, Solakyan was ordered to pay $27,937,175 in restitution to the victim insurers. He is also banned from working in the health care and workers’ compensation industries for his three-year term of supervised release after his prison sentence is served. (Good choice – I wouldn’t want to be referred to him. Why not just ban him forever?)

Today’s Fraud of the Day comes from a Department of Justice press release, “Medical Imaging Companies CEO Sentenced to 5 Years in Prison for $250 Million Health Care Fraud Run Via State Workers’ Comp System,” dated January 28, 2022.

SAN DIEGO – The CEO of several Southern California-based medical imaging companies was sentenced today to 60 months in federal prison for running a scheme that submitted more than $250 million in fraudulent claims through the California Workers’ Compensation System for medical services procured through bribes and kickbacks to physicians and others.

Sam Sarkis Solakyan, 40, of Glendale, was sentenced by United States District Judge Cynthia A. Bashant. Judge Bashant also ordered him to pay $27,937,175 in restitution to the victim insurers. She also banned him from working in the health care and workers compensation industries for his three-year term of supervised release once he completes his prison sentence.

 

 

 

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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.