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Four Physicians Found Guilty for Role in $150 Million Medicare Fraud Scheme

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Four Physicians Found Guilty for Role in $150 Million Medicare Fraud Scheme

Following a four-week trial, a federal jury in Michigan found four Detroit-area physicians guilty of health care fraud and conspiracy to commit health care fraud for their role in a scheme to administer unnecessary back injections – a procedure for which the physicians were paid by Medicare up to $3,500 per hour – to patients in exchange for prescriptions for medically unnecessary opioids.

The scheme operated from 2008 to 2016 and resulted in over $150 million in fraudulent billings to Medicare. Evidence presented at trial showed that many of the patients who accepted unnecessary opioid prescriptions in exchange for receiving back injections were addicts and drug dealers, resulting in some of the prescriptions ultimately being sold on the street. Many patients who received the medically unnecessary back injections experienced severe pain as a result, including from open wounds on their backs.

The four defendants are scheduled to be sentenced between July 16-30 before Chief US District Judge Denise Page Hood of the Eastern District of Michigan.

The DOJ press release can be found here.

Airbus Agrees to Settle Global Bribery Charges for $3.9 Billion

France-based Airbus SE agreed to pay penalties totaling more than $3.9 billion to resolve bribery allegations by American, French, and British authorities arising out of the company’s alleged use of third-party consultants to pay bribes on behalf of the company to secure aircraft contracts. The total fine amount makes it the largest global bribery settlement in history.

Of the total settlement, Airbus agreed to pay U.S. authorities about $527 million to resolve alleged violations of the Foreign Corrupt Practices Act (FCPA) and the International Traffic in Arms Regulations (ITAR). According to a deferred prosecution agreement with DOJ, the FCPA charges arise from Airbus’ alleged scheme to pay foreign officials in order to obtain business from both privately-owned and state-controlled entities, and the ITAR violations result from Airbus’ failure to disclose political contributions, commissions, or fees connected with the sale or export of defense articles or services to a foreign entity. As part of the deferred prosecution agreement, Airbus has also agreed to cooperate with ongoing investigations, including investigations of individuals associated with Airbus.

The biggest portion of the $3.9 billion fine, over $2 billion, will go to French authorities. Airbus' agreement with French authorities requires it to submit to compliance monitoring by the French Anti-Corruption Agency (AFA) for a period of three years. Airbus also agreed to a deferred prosecution agreement with U..K. authorities, which requires it to pay over $1 billion.

The DOJ press release can be found here.
 

Two Men Sentenced to Prison For Role in $48 Million Stock Manipulation Scheme

Two men who pled guilty to conspiracy to commit wire fraud for their involvement in a $48 million stock manipulation scheme involving 11 companies which defrauded about 46,000 investors between 2011 and 2017 were sentenced to prison by a federal judge in Texas.

Former Chimera Energy Corp. CEO Charles Glob Jr. was sentenced to one-year imprisonment and John David Brotherton, who was responsible for creating and distributing false press releases that led to the artificial inflation of Chimera stock, was sentenced to five years imprisonment.

Chimera had published 34 press releases claiming that the company possessed technology that would replace hydraulic fracking with a less environmentally harmful alternative. In reality, this technology did not exist.

Prosecutors argued that Brotherton deserved a harsher penalty, in part, because he sent threatening text messages last February to a co-defendant as well as the FBI agent who arrested him. Attorneys for Glob Jr. argued that, although his title was CEO, he was not a decision-maker and was only carrying out the orders of coconspirators Andrew Ian Farmer and Thomas Galen Massey, who orchestrated several “pump and dump” schemes, including the Chimera scheme.

Farmer and Massey both have pled guilty to counts of conspiracy to commit wire fraud and securities fraud and are set to be sentenced in May.

The indictment can be found here.

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