Scheme to Defraud the W.K. Kellogg Foundation

Mark Mandell, Esq.

 

In 2008 an $800,000 scheme targeting funds from a children’s charity was unearthed. The charity was an organization that is devoted to helping children in Africa.

Nehemiah Muzamhindo, a 48-year-old political refugee from Zimbabwe, was sentenced to six years in federal prison for his role in the scheme targeting funds from the foundation. In addition to his sentence Muzamhindo was also ordered to pay $709,000 in restitution fees.

Muzamhindo had taken $629,000 from the foundation before he was cut out of the scheme. In order to claim funds from the children’s charity Muzamhindo set up bank accounts and shell companies to accept fraudulent claims. Then, he would go on to send half of the money he collected to foundation worker, Sabina Brand, in South Africa. Sabina Brand is currently serving 15 years in a South African prison for her role in the scheme.

During the trial Assistant U.S. Attorney Timothy VerHey attacked the “bad character” of Muzamhindo. VerHey wrote in court documents that; “…His crime had a far-reaching impact, because it led the WKKF to withdraw from its charitable activities in Africa.”

Scott Mertens, Muzamhindo’s defense attorney, argued for Muzamhindo’s character saying that, “Mr. Muzamhindo had been involved in charitable works and has assisted others who have emigrated from Zimbabwe.”

To learn more or to see the original article, please visit: http://www.mlive.com/news/grand-rapids/index.ssf/2013/09/kentwood_man_sent_to_prison_in.html

If you or someone you know is the target of a fraud investigation, or if you have already been indicted, contact the experienced team of fraud attorneys at Fausone Bohn, LLP, at (248) 380-0000 or online at www.MichiganFraudLawyer.com. 

Embezzlement Law in Michigan

Mark Mandell, Esq.

Recently, a Portage, Michigan man was sentenced to 87 months in prison for embezzling $6.5 million from the company where he worked as a comptroller.  In addition to his prison time and supervised release thereafter, he is required to pay restitution of $6.5 million to his former employer.  This shows just how serious the consequences of an embezzlement conviction can be.

Embezzlement in Michigan is governed by statute – MCL §750.174.  In essence, a person is guilty of embezzlement when they are in a relationship of trust to the principal (generally an employer-employee situation); in lawful possession or control of the funds of the principal; and wrongfully take or convert those funds to his own use, with the intent to defraud.

The key element to a charge of embezzlement is that the person takes the money, which belongs to the principal, with the intent to convert it to his own use.  In other words, the person has the fraudulent intent to deprive the owner of his property and take it for himself.  Without this intent to defraud, a taking cannot be embezzlement (though it may constitute another offense.)

The severity of an embezzlement charge depends on the amount of money or personal property taken by the agent or employee.  The charges include the following: 

·        If the money or property taken is valued at less than $200, the charge is a 93-day misdemeanor with a possible fine up to $500; 

·        If the value is up to $1,000, the crime is a 1-year misdemeanor subject to a fine of up to $2,000.

·         $1,000 to $20,000 is a 5-year felony with a fine of up to $10,000. 

·         $20,000 to $50,000 is a 10-year felony with a fine up to $15,000. 

·         $50,000 to $100,000 is a 15-year felony with a fine up to $25,000. 

·         $100,000 and above is a 20-year felony with a fine up to $50,000.

 

Additionally, a person convicted of embezzlement will likely be required to pay restitution to the owner of the amount illegally taken, in addition to the statutory fines and jail time.  Charges may also be enhanced if the defendant has any prior embezzlement convictions on his record.

 

If you are facing embezzlement charges, or if you need more information about this area of the law, contact Michigan Fraud Lawyer Mark Mandell at (248) 380-0000 or online at www.MichiganFraudLawyer.com.  Mr. Mandell can provide you the experienced and knowledgeable legal counsel that is absolutely imperative when facing all manners of criminal charges.

$4.15M Settlement Evidences Benefit of Reporting

Breeda O’Leary, Esq.

The U.S. Government (“Government”) and the State of Michigan (“State”) have reached an agreement in a False Claims Act case wherein the Defendants have agreed to pay $4.15M to the Government and State for fraudulent billings to Medicare and Medicaid.

   
The qui tam provisions of the False Claims Act allows an individual with knowledge of Medicare or Medicaid Fraud, referred to as the “relator,” to file a lawsuit on behalf of the Government against those committing the fraud.  The Government is then provided notice of the lawsuit and is given the option to intervene as Plaintiff in the suit.  If the Government obtains a judgment or settlement in the suit, the relator is provided a percentage of the amount collected.
      
In the instant case, it was alleged that the Defendants, Dr. Jashu R. Patel and other Jackson Cardiology Associates physicians, performed unnecessary cardiac procedures at Allegiance Health’s W.A. Foote Hospital in Jackson, also a Defendant in the case.  Medicare and Medicaid were billed for these procedures.  Dr. Julie A. Kovich, a former independent contractor at Jackson Cardiology Associates, filed suit as the relator in this case.  While Dr. Kovich faces the possibility of being ostracized by her peers, she will receive approximately $764,700.00 as the relator. 
 
If you or anyone you know has specific knowledge of fraudulent billing to Medicare or Medicaid, or is facing criminal or civil liability concerning an alleged fraud, contact the experienced and professional fraud team at Fausone Bohn, LLP for sound legal advice.  Contact us at (248) 380-0000 or online at www.MichiganFraudLawyer.com.

To read the article about the deficiencies in Medicare’s new accounting system, please visit:  http://www.justice.gov/usao/mie/news/2013/2013_7_10_jpatel_HCF.html

Local Oncologist Charged with Medicare Fraud

Mark Mandell, Esq.

Yet another Michigan doctor has been brought up by the FBI on charges of Medicare fraud this past Tuesday. Although this seems like an unfortunate regular occurrence nowadays, this specific case is one of the worst our state has seen.

Dr. Farid Fata, a 48-year-old oncologist from Oakland Township, was arrested Tuesday morning for submitting over $35 million worth of false claims to Medicare. Despite this large fraud, however, the FBI are alleging even worse crimes than cheating Medicare.  In their criminal complaint against Fata, the FBI states he “administered unnecessary chemotherapy to patients in remission.” As shocking as it sounds, not only was Fata fraudulently billing Medicare for his own benefit, but he was abusing the trust and confidence of his cancer patients.

The FBI said that Fata deliberately misdiagnosed patients with cancer so he could bill them for chemotherapy and that he told cancer-free patients who had entered remission that they were still in need of chemotherapy medications. While it is unclear whether Fata’s actions resulted in any severe medical issues or deaths at this point, the FBI is not ruling out the possibilities.

With over $14 million in liquid assets and a house in Lebanon, the FBI considers Fata a flight risk and are holding him until his hearing date arrives. For his current charges he faces up to 20 years behind bars if he is convicted.

If you or someone you know is the target of a fraud investigation, or if you have already been indicted, contact the experienced team of fraud attorneys at Fausone Bohn, LLP, at (248) 380-0000 or online at www.MichiganFraudLawyer.com. 

To learn more or see the original article, please visit: http://www.wxyz.com/dpp/news/region/oakland_county/doctor-arrested-offices-raided-by-fbi-in-connection-to-healthcare-fraud-charges

 

Detroit Area Man Pleads Guilty to Health Care Fraud

Mark Mandell, Esq.

According to the U.S. Justice Department, a Detroit-area Physical Therapist Assistant, Syed Shah, has pleaded guilty to participating in a $22 million home health care fraud.

Prosecutors say that the 51 year old West Bloomfield man acknowledged that he conspired to bill Medicare for home health services that weren’t performed or were not medically necessary.  These actions occurred between 2008 and 2012.

Mr. Shah will be sentenced on November 19th and he faces a maximum penalty of 10 years in prison. 

Long prison sentences such as this are further evidence of the Federal government’s crackdown on health care fraud.  The Federal government is ramping up its investigation and prosecution efforts in an effort to combat the billions of dollars lost annually to Medicare and Medicaid fraud.

If you or someone you know is the target of a fraud investigation, or if you have already been indicted, contact the experienced team of fraud attorneys at Fausone Bohn, LLP, at (248) 380-0000 or online at www.MichiganFraudLawyer.com. 

Lower BAC for drunk driving on the way?

Mark Mandell, Esq

 

According to the release of the Michigan Annual Drunk Driving Audit, the number of drunk driving arrests in Michigan increased in 2012, as did the number of fatalities and injuries. 

 

Last year, the state made 37,182 alcohol- and drug-related driving arrests.  Deaths resulting from drug and alcohol induced crashes increased 7.2%, from 319 in 2011 to 342 in 2012.  Non-fatal injuries also increased.

While there was an increase last year, the overall trend in Michigan is positive – over the past 5 years, the number of traffic deaths involving alcohol has decreased 11.4%.

However, many believe Michigan’s drunk driving numbers are still too high and more needs to be done to deter this conduct.  For instance, the National Transportation Safety Board (NTSB) released its May 2013 Safety Report and advocates for decreasing the per se Blood Alcohol Content (BAC) limit from 0.08 to 0.05.

According to the report, studies have shown that a decrease in the BAC limit down to 0.05 reduces traffic fatalities by 8-12% for people ages 18-49.  In fact, more than 100 countries have established maximum per se BAC limits at or below 0.05 – including 25 of the 27 EU member countries.  Many traffic safety and public health organizations view BAC levels higher than 0.05 as posing an unacceptable risk for driving.

Opponents to the lower BAC limit point out that the majority of alcohol-impaired drivers in fatal crashes have BAC levels significantly higher than 0.08.  However, according to the NTSB, lowering the per se BAC limit changes the drunk-driving behavior of drivers at all BAC levels.  As a consequence, reducing the limit could reasonably be expected to have a broad deterrent effect on all drivers. 

Whether the per se BAC limit gets lowered is in the hands of the legislature; however, despite NTSB’s recommendation, there are no pending bills taking such action.  If you are facing drunk driving charges, or have questions regarding the law, contact experienced criminal defense attorney Mark Mandell at 888-674-1189 or online at www.MichiganFraudLawyer.com.

 

Amid Fraud Crisis, Medicare’s Accounting System Lacking Basic Information

Breeda O’Leary, Esq.
 

Despite the government’s aggressive approach in criminally prosecuting fraudulent providers, a report from the Department of Health and Human Services inspector general found that Medicare’s new accounting system failed to automatically extract critical data regarding providers.  This failure may lead to the inability to collect more than $543 million in overpayments to Medicare providers.

In 2010, Medicare overpaid providers more than $9.6 billion.  Since that time, Medicare has implemented a new accounting system – a system that failed to automatically extract provider and contractor information from the old accounting system.  As a result, Medicare does not have provider or contractor information critical to collecting from those that were previously overpaid.

In addition, the new Medicare accounting system allows information about providers to remain outdated, with little consequence for providers who fail to update their contact information.  Providers receive payments via direct deposit, thus eliminating the incentive to ensure that Medicare has a correct address in its accounting system.

According to agency spokesman Brian Cook, “Reducing the incidence of overpayments is a high priority for [Medicare].”  However, once a provider has been overpaid, having detailed information regarding the provider, such as a proper contact address, is critical to notifying the provider and collecting any overpayments.

While criminal prosecution of fraudulent providers continues to remain a priority for the government, the inspector general’s report highlights glaring deficiencies in Medicare’s new accounting system.  Medicare should address these deficiencies with the same sense of urgency as the criminal prosecution of fraudulent providers.

If you have been contacted concerning an overpayment or a possible criminal investigation, contact the experienced and professional fraud team at Fausone Bohn, LLP for sound legal advice.  Contact Breeda O’Leary at (248) 380-0000 or online at www.MichiganFraudLawyer.com. 

To read the article about the deficiencies in Medicare’s new accounting system, please visit:

http://www.usatoday.com/story/news/politics/2013/07/02/medicare-overpayments-unrecovered/2480429/