Posted by CotoBlogzz
Rancho Santa Margarita, CA - An attorney, accountant, and two
administrators were convicted today of revenue and tax fraud for their roles in
the largest medical fraud prosecution in the nation for recruiting over 255
healthy patients to undergo unnecessary and dangerous surgeries to fraudulently
bill medical insurance companies. This trial involved the failure to file tax
returns and under-reporting income to state tax authorities. The court
bifurcated the case due to its size and volume and additional fraud charges
remain pending and another trial date will be set for those counts. The
defendants are scheduled to be sentenced Dec. 20, 2012,
Roy Chester Dickson, 64, Yorba Linda, Unity's
attorney, was found guilty by a jury of two felony counts of filing a false personal
tax return and faces a maximum sentence of three years and eight months in
state prison for these counts. Dickson faces 101 additional felony counts which
include two counts of conspiracy, eight counts of capping or paying for
referrals, 30 counts of grand theft, 30 counts of insurance fraud, 30 counts of
making false and fraudulent claims, one count of money laundering, and white
collar sentencing enhancements for taking over $2.5 million on the fraud
counts. These counts will be tried at a later date.
Andrew Robert Harnen, 58, Rosemead, Unity's
accountant, was found guilty by a jury of three felony counts of filing a false
tax return and six counts of failing to file tax returns. He faces a maximum
sentence of eight years and four months in state prison for these counts.
Harnen faces 101 additional felony counts which include two counts of
conspiracy, eight counts of capping or paying for referrals, 30 counts of grand
theft, 30 counts of insurance fraud, 30 counts of making false and fraudulent claims,
one count of filing a false tax return, and white collar sentencing
enhancements for taking over $2.5 million on the fraud counts. These counts
will be tried at a later date.
Dee Francis, 63, a Unity administrator, was found
guilty by a jury of one felony count of filing a false tax return and six
counts of failing to file tax returns. She faces a maximum sentence of seven
years in state prison for these counts. Francis faces 102 additional felony
counts which include two counts of conspiracy, eight counts of capping or
paying for referrals, 30 counts of grand theft, 30 counts of insurance fraud,
30 counts of making false and fraudulent claims, one count of filing a false
tax return, two counts of failing to file tax returns, and white collar sentencing
enhancements for taking over $2.5 million on the fraud counts. These counts
will be tried at a later date.
Rosalinda Rodriguez Landon, 66, a Unity
administrator, was found guilty by a jury of six felony counts of filing false
tax returns and faces a maximum sentence of six years and four months in state
prison for these counts. Landon faces 101 additional felony counts which
include two counts of conspiracy, eight counts of capping or paying for
referrals, 30 counts of grand theft, 30 counts of insurance fraud, 30 counts of
making false and fraudulent claims, one count of money laundering, and white
collar sentencing enhancements for taking over $2.5 million dollars. These
counts will be tried at a later date.
Doctor
William Wilson Hampton, Jr., 57, Seal Beach, pleaded guilty May 8, 2009, to 47
felony counts including conspiracy, insurance fraud, and capping and was
sentenced to 16 years in state prison.
Doctor Michael Cheeluen Chan, 66, Cerritos,
pleaded guilty Aug. 4, 2011, to the court to 40 felony counts including
conspiracy to commit insurance fraud, insurance fraud, aiding and abetting
capping with white collar crime sentencing enhancements. He faces a sentence
ranging from probation up to 28 years in state prison at his sentencing Dec. 7,
2012,
Doctor Mario Rosenberg, 65, is charged with 49
felony counts including two counts of conspiracy, eight counts of capping or
paying for referrals, 19 counts of insurance fraud, 19 counts of making false
or fraudulent claims, and one count of grand theft. Rosenberg is scheduled for
a pre-trial hearing Dec. 21, 2012,
Capper Sue Nanda, 44, Costa Mesa, pleaded guilty
Feb. 20, 2009, to 22 felony counts including conspiracy, capping, grand theft,
filing false tax returns, failing to file tax returns, and making false and
fraudulent statements. Nanda was sentenced to 10 years in state prison and
ordered to pay over $500,000 in restitution for personal and corporate back
taxes.
Capper Maria DeJesus Licea Rosales, 45, pleaded
guilty Aug. 7, 2009, to 96 felony counts including conspiracy, capping,
insurance fraud, grand theft, filing fraudulent tax returns, and sentencing
enhancements for white collar crime and loss over $2.5 million. She was
sentenced to eight years in state prison.
Capper Olga Lilia Toscano, 44, pleaded guilty Aug.
11, 2009, to the court to 98 felony counts including conspiracy, capping,
insurance fraud, grand theft, tax evasion, and sentencing enhancements for
aggravated white collar crime and loss exceeding $2.5 million. She was
sentenced to eight years in state prison.
Capper Ngoc Trang Huynh, 52, pleaded guilty Aug.
19, 2011, to 56 felony counts including conspiracy, capping, insurance fraud,
grand theft, tax evasion, filing a false income tax return, and sentencing
enhancements for aggravated white collar crime and loss exceeding $2.5 million.
He faces a maximum of 45 years and eight months in state prison at his sentencing
Dec. 7, 2012.
Capper Pancha Keophimphone, 61, pleaded guilty to
a court offer Aug. 19, 2011, to 56 felony counts including conspiracy, capping,
insurance fraud, grand theft, tax evasion, and sentencing enhancements for
aggravated white collar crime and loss exceeding $2.5 million. Keophimphone was
sentenced to 12 years in state prison stayed pending completion of five years
formal probation. She was ordered to serve one year in jail and will be ordered
to pay restitution at a hearing on Dec. 7, 2012.
Capper Thuy Thu Huynh, 54, pleaded guilty Aug. 25,
2011, to 58 felony counts including conspiracy, capping, insurance fraud, grand
theft, tax evasion, and sentencing enhancements for aggravated white collar
crime and loss exceeding $2.5 million. Huynh is scheduled to be sentenced Dec.
7, 2012
Capper Henry Truong, 44, pleaded guilty April 7,
2006, to 13 felony counts including conspiracy, capping, insurance fraud, grand
theft, tax evasion, and sentencing enhancements for aggravated white collar
crime and loss exceeding $2.5 million. Truong was sentenced to 12 years in
state prison and ordered to pay restitution.
Cappers Amanda Phuc Tran, 53, and Nicholas Vu, 54,
pleaded guilty Nov. 21, 2005, to two felony counts each of insurance fraud and
making false or fraudulent claims with sentencing enhancements for loss
exceeding $2.5 million. Tran and Vu were sentenced to five years in prison
stayed pending 10 years formal probation and ordered to pay restitution.
Administrator Tam Vu Pham, 48, pleaded guilty Dec.
27, 2005, to one felony count each of conspiracy and money laundering, eight
felony counts of capping or paying for referrals, three felony counts of making
false or fraudulent claims, and two felony counts of insurance fraud, with
sentencing enhancements for aggravated white collar crime, loss exceeding $2.5
million, and laundering over $150,000, Pham was sentenced to 12 years in prison
and ordered to pay restitution.
Administrator Huong Thien Ngo, 46, pleaded guilty
Dec. 27, 2005, to one felony count each of conspiracy, making false or
fraudulent claims, tax evasion, and money laundering, with sentencing
enhancements for aggravated white collar crime, loss exceeding $2.5 million,
and laundering over $150,000. Ngo was sentenced to seven years in prison
suspended pending six years of formal probation and ordered to pay restitution.
Administrator Lan Thi Ngoc Nguyen, 56, pleaded
guilty Dec. 27, 2005, to one felony count each of conspiracy, making false or
fraudulent claims, and filing a false tax return, with sentencing enhancements
for aggravated white collar crime and loss exceeding 42.5 million. Nguyen was
sentenced to five years in state prison suspended pending six years of formal
probation and ordered to pay restitution.
According to the Orange County District Attorney’s
(OCDA) office:
The defendants in the Unity case are accused of
participating in a $154 million medical insurance fraud scheme that recruited
2,841 healthy people from all over the country to receive unnecessary surgeries
in exchange for money or low cost cosmetic surgery. Insurance companies paid
out more than $20 million over a 9-month period.
Of the 19 defendants charged in the Unity case, 13
were indicted by a criminal grand jury on June 13, 2008. Six other defendants
in the Unity case pleaded guilty prior to the indictment and have been
sentenced.
The Orange County Grand Jury examined 1,054
exhibits and heard testimony from 56 witnesses over 28 days, resulting in a
70-page indictment. The indicted defendants include an attorney, accountant,
three doctors, and patient recruiters known as "cappers." The
recruitment of patients, or "capping," is illegal in California.
Unity was jointly investigated by the California
Department of Insurance and Orange County District Attorney's Office with
assistance from the California Franchise Tax Board.
Keophimphone, Ngoc Huynh, Thuy Thu Huynh, Toscano,
Nanda, Rosales, Truong, Tran, and Vu, have pleaded guilty to multiple felony
counts of capping.
The Unity cappers targeted employees from
businesses in 39 states who were covered by PPO insurance plans, affecting more
than 1,000 employers whose employees became involved in this scheme. They
arranged transportation for the patients, scheduled the surgeries, and coached
the healthy "patients" on what to say. In exchange for undergoing
surgery, the patients received a cash payment, usually between $300 and $1,000
per surgery, or credit toward a free or discounted cosmetic surgery.
Keophimphone personally recruited 118 patients
from 17 different states for 297 surgical procedures. These so-called patients,
who were mostly coming from other states besides California, resulted in over
$8 million in billings to insurance companies for unnecessary surgical
procedures. Ngoc Huynh personally recruited 67 so-called patients, most coming
from outside California. These so-called patients received 151 unnecessary
medical procedures resulting in over $4 million in billings to insurance
companies.
Rosales recruited over 90 so-called patients, all
of whom were from California. Nanda recruited over 170 so-called patients from
16 different states for unnecessary surgical procedures. They had no medical
training, yet recruited patients with PPO insurance, scheduled surgical
procedures, and coached patients to correctly describe symptoms for the
unnecessary surgical procedures. They assisted patients in filling out surgery
center paperwork, including having them sign a false affidavit stating that
they had not been offered compensation and had not received any compensation in
exchange for using Unity's services. For Unity capping, Nanda was paid directly
and through corporations she had set up.
The three doctors charged in this case are accused
of participating in medical insurance fraud for performing unnecessary medical
procedures on healthy people with the knowledge that the patients were being
recruited. Doctors Chan, Hampton, and Rosenberg are accused of performing a
total of 1,037 procedures, resulting in insurance billings exceeding $30
million for the facilities fees alone. Unity received over $5.1 million in
payment as a result of the surgeries performed by these doctors.
The doctors performed many of the surgeries on
Saturdays and Sundays and often performed the same procedures on co-workers or
members of the same household on the same day. The doctors are accused of
ignoring basic medical protocols such as: 1) Patients receiving surgeries on
consecutive days instead of under one anesthesia; 2) Doctors not meeting the
patients prior to operating; 3) Doctors not following up with patients after
the procedure was completed; and 4) Doctors not obtaining necessary medical
information.
Chan worked as the Medical Director at Unity and
specialized in invasive gynecological procedures. He performed unnecessary
surgeries on 161 patients including include laproscopy, tubaligation,
colporrhaphy, and hysterectomy procedures. Not a single one of Chan's patients
were referred by a doctor or were medically necessary. Every patient Chan
operated on was referred by a capper, 88 percent being referred by cappers
charged in this case. Of Chan's patients, 60 percent were flown in for the
unnecessary surgeries from 18 states outside of California.
Hampton, a general surgeon, performed 180
procedures on 178 patients. He primarily performed thoracic sympathectomies,
also known as sweaty palm surgeries, a highly unusual and dangerous medical
procedure that can often be treated with topical creams, medication, and botox.
Of the patients that underwent surgery by Hampton, 97 percent were referred by
Unity cappers. Hampton was also indicted and convicted by the federal
government for his involvement in a scheme similar to the Unity case.
Attorney Dickson went to Unity after having
previously managed and represented another surgery center involved in similar
illegal activities. He was sanctioned by the federal bankruptcy court for
filing a fraudulent bankruptcy claim for a doctor at that surgery center.
Dickson was hired by Unity to collect payments from insurance companies and
patients. He helped the surgery scheme by creating fraudulent documents to
disguise illegal capping activities.
Immediately after the OCDA searched Unity in April
2003, Dickson used his attorney client trust account to keep Unity open and
operating and furthered the criminal activity by funneling over $1 million in
surgery center cash assets into his account to prevent it from being seized. In
the three months following the search of Unity, he laundered as much as $3
million into the attorney client trust account using fraudulently billed
payments from insurance companies to keep the surgery center operating.
Accountant Harnen, a Unity bookkeeper and profit
shareholder, signed 10 checks to doctors totaling over $50,000 and 157 checks
to cappers totaling almost $1 million for their participation in the Unity
scheme. He acted as an official representative for several of the corporations
used by Unity to hide their illegal scheme from insurance companies, and was
one of the bank signatories for multiple bank accounts used in the fraud.
Harnen assisted cappers and administrators in
hiding their illegal activities by helping them funnel money to corporations that
he helped them to create with the intention of hiding income and avoiding
detection of their crimes. Harnen helped Unity continue to illegally recruit
"patients" and defraud insurance companies using his own corporation
to pay cappers and distribute profits to shareholders. Harnen failed to report
more than $6 million in income over a 3-year period by failing to file tax
returns and filing false tax returns.
Landon and Francis were clinic administrators and
recruited doctors and cappers. They ran the Unity facility, coordinated the
fraudulent surgeries, sent all facility billings, received payments from
insurance companies on fraudulent billings, and received and paid capper
invoices for patient procedures.
Administrators Pham, Ngo, and Nguyen pleaded
guilty to performing the same roles in the scheme.
Senior Deputy District Attorney William Overtoom
and Deputy District Attorney George McFetridge of the Major Fraud Unit are
prosecuting all of the defendants in this case.
