Testing Facility Settles $2.5 Million Anti-Kickback Lawsuit

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Testing Facility Settles $2.5 Million Anti-Kickback Lawsuit

On May 15, the US Attorneys for the Southern District of New York announced that they had settled their civil fraud lawsuit against Balance Diagnostics USA, LLC, a diagnostic testing facility based in Cedarhurst, New York, for paying kickbacks to physicians and their medical practices in violation of the Anti-Kickback Statute.

The complaint alleged that between 2009 and 2019, Balance, which provides on-site mobile diagnostic testing services, offered and paid physicians and their practices hundreds of thousands of dollars in kickbacks in the form of sham “rent payments” in order to induce them to refer patients to Balance. The complaint also alleged that Balance would inquire with the physicians about the number of patients they anticipated referring to Balance for diagnostic testing services each month and would then use these anticipated referral rates to negotiate the amount paid in rent to the providers each month. Notably, if the monthly referral rates fell below the levels that Balance had expected, the government alleged that Balance would frequently reduce the rent amount paid to the providers.

As a part of the settlement agreement, Balance agreed to pay $1,725,850 to the United States and $774,150 to New York state. In addition, Balance agreed to the entry of a consent judgment of $4,280,108 in favor of the United States and $1,918,892 in favor of New York state.

The press release can be found here.

Two Charged With $174 Million Health Care Fraud Conspiracy

On May 14, the government announced that the grand jury had charged two individuals, Jamie McNamara of Missouri and John Spivey of Louisiana, in an 18-count superseding indictment. The charges include conspiracy to commit health care fraud and wire fraud, health care fraud, conspiracy to pay and receive kickbacks, offering and paying kickbacks, conspiracy to commit money laundering, and money laundering. McNamara is charged in every count and Spivey is charged in the conspiracy to commit health care fraud and wire fraud counts.

The charges stem from allegations that McNamara and Spivey, who operated several laboratories, billed for cardiovascular and cancer genetic testing that was ineligible for Medicare reimbursement because they were not medically necessary and procured through illegal kickbacks and bribes. McNamara and Spivey are alleged to have obtained orders for genetic testing from physicians via call centers and telemarketers to induce Medicare beneficiaries to agree to receive genetic testing. The indictment alleged that telemedicine doctors signed these genetic testing orders even though they were not the beneficiaries’ treating physicians, did not perform consultations, and did not follow up with the beneficiaries after the testing was performed. McNamara and Spivey’s laboratories are alleged to have submitted over $174 million in false and fraudulent claims to Medicare for genetic testing and received over $55 million in reimbursements.

The press release can be found here.

Two Brothers Charged With $25 Million Cryptocurrency Fraud

On May 15, the US Department of Justice (DOJ) announced that an indictment had been unsealed, charging two brothers, Anton Peraire-Bueno and James Peraire-Bueno, with conspiracy to commit wire fraud, wire fraud, and conspiracy to commit money laundering in connection with a cryptocurrency scheme.

The DOJ alleges that the defendants used their specialized skills and education to manipulate and tamper with the protocols and process by which transactions are validated and added to the Ethereum blockchain. Through these methods, the defendants are alleged to have gained access to pending private transactions and altered the movement of the electronic currency, which they used to steal $25 million in cryptocurrency within 12 seconds. According to the DOJ, the defendants took numerous steps to conceal their identities and stolen proceeds, including creating shell companies, using private cryptocurrency addresses and foreign cryptocurrency exchanges, and transferring the stolen cryptocurrency through a series of transactions designed to conceal the source and ownership of these funds.

If the two individuals are convicted, they face a penalty of up to 20 years in prison for each count.

The DOJ press release can be found here.


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