Alabama

July 20, 2010

Former Pharmacy Technician Pleads Guilty to Health Care Fraud (U.S. Attorney for the Northern District of Alabama)

Huntsville - A Rainbow City woman pleaded guilty on July 20, 2010, to health care fraud totaling more than $330,000 for illegal prescription reimbursements she received while working as a pharmacy technician at a discount department store in East Gadsden, U.S. Attorney Joyce White Vance and FBI Special Agent in Charge Patrick Maley announced.

Charlotte Turley, 52, pleaded guilty before U.S. District Judge C. Lynwood Smith Jr. to four counts of health care fraud and agreed to forfeit at least $331,118 to the government as proceeds of illegal activity. A federal grand jury indicted Turley on the fraud charges in April.

“When someone steals money intended to pay legitimate claims, it results in higher overall health insurance costs to everyone,” Vance said. “We intend to be vigilant in detecting and prosecuting this type of crime. Would-be health care criminals are not welcome in Alabama.”

According to Turley’s plea agreement, she schemed to defraud Blue Cross and Blue Shield of Alabama between June 2005 and July 2008 while she worked at an East Gadsden K-Mart store. As a pharmacy technician, Turley entered insurance claim information for prescription drugs into the store’s computer system. Turley acknowledged in her plea agreement that she entered false information to reflect she received prescriptions that were never prescribed, and that she received reimbursements from Blue Cross and Blue Shield for the fake prescriptions.

The defendant faces maximum sentences of 10 years in prison and fines of up to $250,000 on each count. Sentencing is scheduled Nov. 18 at 11 a.m.

The FBI investigated the case. It is being prosecuted by Assistant U.S. Attorneys Lloyd Peeples and Henry Cornelius.

March 10, 2010

Federal Judge Sentences Former Simon-Williamson Clinic Employee to 30 Months in Prison for Fraud (U.S. Attorney for the Northern District of Alabama)

Birmingham, AL - A federal judge on March 10, 2010, sentenced a Hoover woman to 30 months in prison for health care, wire and tax fraud involving nearly $1.2 million embezzled from a Birmingham health care provider, United States Attorney Joyce White Vance announced in conjunction with U.S. Postal Inspection Service, FBI and IRS officials.

Kimberly Perrin, 41, worked as comptroller for the Simon-Williamson Clinic in Birmingham. She embezzled $1,197,074 from the clinic between July 2005 and February 2009.

U.S. District Judge Karon O. Bowdre ordered Perrin to pay combined restitution of $1,553,419 to the clinic and to the Internal Revenue Service. Perrin is repay the clinic $1,197,074 and the IRS $356,345 in unpaid taxes. Perrin also must forfeit $1,197,074 to the government as proceeds of illegal activity.

Judge Bowdre ordered Perrin to serve three years supervised release after completing her prison term, and to perform 40 hours of community service.

“Over the course of several years, Perrin wrote numerous checks totaling more than $1.1 million from her employer’s business account to enhance her own personal lifestyle,” Vance said. “In so doing, Perrin not only stole from her employer, she defrauded the IRS out of more than $356,000 in unpaid income taxes. Such criminal conduct must be punished in order to discourage others who might be tempted by their own greed,” Vance said.

Perrin carried out her embezzlement scheme by causing the clinic to issue and mail checks both to her, personally, and to third parties to pay for her personal expenses. In order to conceal her conduct, Perrin did not make appropriate entries on the clinic’s books and records. Perrin also did not report receiving the income on her tax returns for the 2005, 2006, 2007 and 2008 tax years.

“Stealing from a health care provider hurts that business and the doctors who work there, but it also affects the cost of health care and, therefore, harms us all,” said FBI Special Agent in Charge Patrick Maley. “That is why the FBI takes seriously its responsibility to investigate and hold accountable individuals who perpetrate this, and all white-collar crime,” he said.

“The IRS enforces the nation's tax laws, but also takes particular interest in cases where someone, for their own personal benefit, has taken what belonged to others,” said IRS Criminal Investigation Special Agent Reginael D. McDaniel.  “We are pleased with the successful resolution of this investigation due to the cooperative efforts of the U.S. Attorney's Office, the U.S. Postal Inspection Service and the FBI,"  McDaniel said.

“It is repulsive that during a time when many Americans are concerned over health care costs, Ms. Perrin defrauded a health care system of well over a million dollars,” said U.S. Postal Inspector in Charge, Atlanta Division, Martin D. Phanco. “I am proud to say, as in this case, postal inspectors stand vigilant to track such detrimental fraud and assist in prosecution whenever the scheme involves U.S. mail.”

Assistant U.S. Attorney Lloyd Peeples prosecuted the government’s case.

August 7, 2009

Civil Healthcare Fraud Allegations Settled for $1.4 million (U.S. Attorney for the Northern District of Alabama)

BIRMINGHAM, AL - An investigation launched by a whistleblower complaint resulted today in the settlement of a civil healthcare fraud case and a $1,448,174 judgment against William “Bill” King Jr., Marie King, King & Associates, Inc., and SouthernCare, Inc., announced U.S. Attorney Joyce White Vance, the FBI and the U.S. Department of Health and Human Services.

Marie King, a registered nurse, managed, directed and operated King & Associates, Inc., which was in the business of providing consulting services to skilled nursing facilities in Alabama and other southeastern states. Bill King, an accountant, managed, directed and operated SouthernCare, Inc., doing business as King and Associates. SouthernCare was engaged in the business of preparing Medicare cost reports for skilled nursing facilities, including some of the skilled nursing facilities which used the services provided by King & Associates.

From 2002 until May 2007, the defendants caused false claims for utilization review (“UR”) services to be presented in cost reports to the Medicare Program. Although Medicare guidelines state that only payments made to physicians for their services on UR committees are allowable as cost claims for a skilled nursing facility, the Kings and their respective companies caused certain of their skilled nursing facility clients to present claims which overstated the amount of work performed by physicians. Those false claims increased the Medicare reimbursement to these clients, resulting in losses of over $740,000 to Medicare.

This matter was brought to the attention of the United States through the filing of a qui tam complaint under the False Claims Act. The act authorizes private parties to file suit against those who defraud the United States, and to receive a share of any recovery. The whistleblower was an accountant who worked for a company that prepared cost reports for the skilled nursing facilities, which had been clients of SouthernCare. After conducting its investigation, the United States, on April 30, 2008, intervened in the qui tam action with respect to Bill King, Marie King, King & Associates, and SouthernCare. The United States did not intervene with respect to other parties mentioned in the whistleblower’s complaint. On June 2, 2008, the United States filed its Complaint in Intervention against the Kings and their respective companies.

The settlement agreement filed today in the civil case provides that the United States will pay 19 percent of any amount received to the whistleblower who initiated the qui tam action. Additionally, the settlement agreement provides that the Kings and their companies will pay attorney’s fees and costs totaling $36,273.50 to the whistleblower’s counsel, Hare, Wynn, Newell & Newton, LLP. Bill King and Marie King have both also pled guilty and been sentenced for federal criminal violations related to these actions. In connection with those criminal matters, the Kings forfeited $600,000. Those funds will be applied to the $1,448,174 judgment.

“Whistleblowers who ignore potential harm to their careers and reputations when they notify the government of fraudulent conduct are a critical part of many investigations,” said U.S. Attorney Vance. “Without their assistance, fraudulent conduct might otherwise go undetected.”

Carl Bocchicchio, assistant special agent in charge, U.S. Department of Health and Human Services, Office of the Inspector General, said: “This investigation illustrates the effectiveness of pursuing a multi-facet approach in combating Medicare-fraud by utilizing the False Claims Act statutes and criminal prosecution. The two-prong approach produces positive results in protecting the Medicare trust fund and our beneficiaries.”

“This is not a victimless crime – every person who struggles to pay for health care benefits; every older person who worries about Medicare’s ability to cover them; every taxpayer who helps fund these programs – these are all victims,” said FBI Special Agent in Charge Patrick Maley. “The public should know that we will continue to work together to identify and stop those who would line their own pockets with taxpayer money-those who seek to benefit at the expense of our health care system, our economy, and our collective well-being.”

The HHS Office of the Inspector General and the FBI investigated the case. Assistant United States Attorney Lloyd Peeples represented the United States in both the civil and criminal matters.

More information on the U.S. Attorney for the Northern District of Alabama: http://www.usdoj.gov/usao/aln/