Sunday, October 25, 2020

CEO Pleads Guilty to $424 Million Conspiracy in Medicare Fraud Scheme

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The owner and Chief Executive Officer of a telemarketing company is guilty of money laundering and conspiring to defraud Medicare to gain health care kickbacks.

Lester Stockett, owner of Video Doctor USA and Telemed Health Group LLC, and CEO of AffordADoc, pleaded guilty before U.S. District Judge Madeline Cox Arleo in New Jersey on Friday, in a statement from the Department of Justice (DOJ).

The 52-year-old admitted that he and his co-conspirators solicited illegal kickbacks and bribes from patient recruiters, pharmacies, and brace suppliers to convince doctors to order orthotic braces for those on Medicare and other insurance.

According to the DOJ, the health care provider and the receiver made the orders after only a short phone call.

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Braces suppliers submitted more than $424 million in false and fraudulent claims to Medicare.

His cohorts were Floridians Creaghan Harry, 51, and Elliot Loewenstern, 56.

They marketed themselves as a telemedicine enterprise that “made revenue of ‘$10 million per year’ and ’20 percent profit’ from payments by beneficiaries who enrolled in a membership program and paid for the telemedicine consultations.” That was false because the revenue came through bribery.

Related: Jury will decide fate of health executive in $1 billion Medicare fraud trial

“The extent of Mr. Stockett’s fraud and money laundering, literally, knew no bounds. From the U.S. to Latin America, the Philippines, and the Dominican Republic, the FBI followed the trail of ill-gotten gains back to Stockett and his conspirators. They stole precious federal funds earmarked to assist the elderly,” said Special Agent in Charge Gregory W. Ehrie of the FBI’s Newark Field Office.

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Stockett and his co-conspirators were aware of the violation, but still paid the illegal kickbacks and bribes through companies and bank accounts they opened in the country and in the Dominican Republic. He also admitted that they hid the existence of the foreign entities by fabricating fake statements to financial institutions, and lying to the IRS.

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