Whistleblower Group

April 18, 2016

Coloroda-based defense contractor IONU Security, Inc. agreed to pay $450,000 to settle charges of violating the False Claims Act in connection with an Army Contract for Bradley Fighting Vehicles (“Bradleys”) under which IONU provided Turret Control Drive Units (“TDCUs”) for the Bradleys under subcontracts with the Prime Contractor.  The TDCU is a control box that provides power to control the turret, including weapons systems, of a Bradley.  According to the government, the TDCUs did not meet the requirements of the contract and despite knowing that their failure could result in an electronic short and catastrophic failure, IONU did not notify the Prime Contractor or the government of the defective parts.  The allegations originated after a whistleblower notified the Department of Defense through its fraud hotline.  DOJ (WDTX)

April 18, 2016

California-based sportswear importer Winds Enterprises, Inc. agreed to pay $1.5 million to resolve allegations it violated the False Claims Act by underpaying on import duties on shipments from 2010 to 2014.  The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by a former Winds Enterprises employee, who will receive whistleblower award of $300,000 from the proceeds of the government's recovery.  DOJ (WDWA)

April 15, 2016

New Jersey-based Freedom Mortgage Corporation agreed to pay $113 million to resolve allegations it violated the False Claims Act by knowingly originating and underwriting single family mortgage loans insured by the U.S. Department of Housing and Urban Development’s (HUD) Federal Housing Administration (FHA) that did not meet applicable requirements for the FHA insurance program.  DOJ

April 14, 2016

Boston Medical Center (BMC) and two of its physician practice organizations agreed to pay $1.1 million to resolve allegations they violated the False Claims Act by improperly billing Medicare and Medicaid.  Specifically, the government charged that (1) BMC billed Medicare for more units of Rituxan, an expensive cancer drug, than BMC actually infused in its patients; (2) BMC billed Medicare and Medicaid for services at its pre-surgical treatment center even though the global fee for the subsequent surgeries covered those same treatments; and (3) BMC submitted claims to Medicare for outpatient podiatry services where the clinical documentation did not support the reasonableness and necessity of the services.  The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by BMC’s former Chief Compliance Officer, Kathleen Heffernan.  She will receive a yet-to-be-determined whistleblower award from the proceeds of the government's recovery.  DOJ (DMA)

April 13, 2016

Nery Cowan, a former health care clinic consultant and Medicare biller for partial hospitalization program Greater Miami Behavioral Healthcare Center Inc. was sentenced to 135 months in prison and ordered to pay a $100,000 fine for her role in laundering money in connection with a $63 million health care fraud scheme.  As part of her guilty plea, Cowan admitted to directing and authorizing the payment of kickbacks and bribes to patient brokers and others in exchange for Medicare beneficiary referrals.  Cowan also admitted that Greater Miami personnel routinely falsified medical records affiliated with these recruited Medicare beneficiaries to support false claims to Medicare.  Cowan also admitted that she, along with co-defendants Dean Butler and Irina Mora, took great lengths to conceal kickback payments to shell companies owned by “patient brokers” who, on behalf of Greater Miami, solicited Medicare beneficiaries from assisted living facilities, halfway houses and drug courts located throughout the Southern District of Florida.  Judge Bloom previously sentenced Butler and Mora to 16 years and nine years in prison, respectively, following their guilty pleas.  DOJ

April 13, 2016

Florida Pain Medicine Associates, Inc. and its owners, Drs. Bart Gatz, Alexis Renta, and Albert Rodriguez, agreed to pay $1.1 million to resolve allegations they violated the False Claims Act by billing Medicare for medically unnecessary nerve conduction studies.  The allegations originated in a whistleblower lawsuit filed under the qui tam provisions of the False Claims Act by Rosa Gomez, who had worked in Florida Pain Medicine’s billing department.  She will receive a whistleblower award of $242,000 from the proceeds of the government's recovery.  DOJ (SDFL)

April 12, 2016

Cecil Alexander Kent Jr. pleaded guilty to fraud charges for his role in a scheme to defraud Medicare out of approximately $6.2 million while he acted as an unlicensed physician at a Detroit in-home physician services company.  Kent admitted that while he was employed at B&M Visiting Doctors PLC and while he was unlicensed, he saw patients and falsified related patient records, including medical documents and billing documents, all under the name of a licensed medical doctor.  He admitted that among those documents falsified were prescriptions for controlled substances.  DOJ

April 11, 2016

Tennessee-based drug urine screening company PremierTox 2.0, Inc. (previously called Nexus) agreed to pay $2.5 million to resolve allegations it violated the False Claims Act by submitting false claims when billing Medicare, TennCare and Kentucky Medicaid for drug urine screening services.  According to the government, PremierTox had a swapping arrangement under which Nexus gave below cost discounts on its urine drug screen tests to patients in Tennessee without insurance, in exchange for physicians’ referring their patients with Medicare or TennCare coverage to Nexus. The government also contended that in Tennessee Nexus submitted excessive claims to Medicare and TennCare for laboratory testing that was beyond what was medically reasonable and necessary.  The allegations originated in two whistleblower lawsuits filed under the qui tam provisions of the False Claims Act by a former office manager of a pain clinic and the former CEO of PremierTox.  The office manager will receive a whistleblower award of $361,250, and the former CEO will receive a whistleblower award of $56,250.  DOJ (MDTN)

April 11, 2016

Goldman Sachs agreed to pay $5.06 billion to settle charges relating to alleged misconduct in the sale of its residential mortgage-backed securities or what the government described as "serious misconduct in falsely assuring investors that securities it sold were backed by sound mortgages, when it knew that they were full of mortgages that were likely to fail."  Whistleblower Insider

April 11, 2016

Naseem Minhas, the owner and operator of Detroit-area home health care agency TriCounty Home Care Services Inc. pleaded guilty today for his participation in a $4 million health care fraud scheme.  According to admissions made as part of his plea agreement, Minhas paid a physician and recruiters to refer Medicare beneficiaries to TriCounty and sign medical documents falsely certifying that they required home health care.  Minhas, a licensed physical therapist, also admitted that he assisted in creating fake patient files to make it appear as though the patients needed and received services that were unnecessary or not provided.  DOJ