$154M Alleged Surgery Scam Trial Begins
Insurance Fraud -- By Trace America on August 30, 2012 at 2:42 PM
Back in November we brought you this story, about several people who were accused of participating in a scheme that brought in healthy patients for unneeded surgeries in order to get the money that would come out of the fraudulent insurance bills to follow.
According to The Orange County Register, the scam came to light back in 2008 when a grand jury indictment accused doctors at Unity Surgical Outpatient Center in Buena Park of performing those surgeries.
Orange County prosecutors note that multiple defendants connected to Unity had billed insurance companies for a staggering amount of money -the kind only imaginable by people like Bill Gates, Donald Trump or Oprah Winfrey. The 2,841 healthy patients who were recruited in the scheme had those unnecessary surgeries, including tummy tucks, colonoscopies, hysterectomies, the removal of cysts and the treatment of sweaty palms and hemorrhoids, and cost insurance companies about $154 million.
Aside from the amount of money, the investigation itself was also colossal. By the numbers, the grand jury had to examine 1,054 exhibits and listen to testimony from 56 witnesses over the course of 28 days in order to indict 13 defendants, including an attorney, an accountant, 3 administrators and several patient recruiters known as "cappers."
Authorities were calling it the largest medical fraud case in the nation.
Most of the defendants, including two doctors, have since pleaded guilty to fraud charges and have either been or are awaiting sentencing. One doctor has already been given 16 years in prison.
And finally, over four years after the indictment went public, the first trial involving Unity began.
Four defendants - an attorney, an accountant and two administrators - are being tried together on multiple charges of filing false tax returns or failing to file tax returns. They face prison terms ranging from five to 15 years if convicted. They also could be tried later on insurance and other white-collar fraud charges.
Superior Court Judge Thomas Goethals is heading up the trial, which is expected to last about six weeks. Opening statements are scheduled for August 30th.
The four defendants mentioned above are:
*Unity attorney Roy Dickson, 64, whom Unity supposedly hired to collect the payments from insurance companies and patients. He is also accused of helping the surgery scheme by making fraudulent documents that would disguise the illegal capping activities.
*Unity accountant Andrew Harnen, 58, who supposedly signed the checks for the doctors who participated in the scheme. Harnen is also accused of helping the cappers and the administrators hide their illegal activities by helping them send money to the corporations that they created for the purpose of keeping their income hidden and their crimes undetected.
*Unity administrators Dee Francis, 63, and Rosalinda Landon, 66, who are accused of setting up the fraudulent surgeries and recruiting the "patients." Prosecutors state that Francis was also a shareholder in Unity.
Landon's defense attorney, Roger Sheaks, said she is not guilty of tax-evasion because she was only relying on advice from Harnen.
The two doctors who have already pled guilty are Dr. William Wilson Hampton Jr., 58, who pled back in 2009 to 47 felony counts including conspiracy, insurance fraud and capping and received 16 years; and Dr. Michael Chan, 66, pled in 2011 to 40 felony counts including conspiracy to commit insurance fraud, insurance fraud and aiding and abetting capping, and his sentencing has been set for October 1st.
The third medical doctor charged in the case, Dr. Mario Z. Rosenberg, 65, is still awaiting his trial.
When added together, Chan, Hampton and Rosenberg are accused of performing 1,037 invasive procedures.
According to the charges, the "patients" were usually paid anywhere from $300 to $1,000 per surgery for agreeing to the procedures. read more