The U.S. Attorney’s Office for the Middle District of Florida covers 35 of Florida’s counties. Those include counties in the Tampa Bay area.

TAMPA – The U.S. Attorney’s Office for the Middle District of Florida collected $98,607,097 in locally handled criminal and civil actions in the fiscal year that ended Sept. 30.

Of that amount, $79,862,063 was collected in local civil actions and $18,745,043 was collected in criminal actions, , according to Maria Chapa Lopez, who heads up the Middle District of Florida office. The Middle District of Florida includes 35 of the state’s 67 counties. More than 11.5 million Floridians reside in the district, making the Middle District of Florida the second most populous district in the nation. The Middle District of Florida has offices in Tampa, Orlando, Jacksonville, Fort Myers, and Ocala.

The MDFL’s Civil Division, led by Civil Chief Randy Harwell, recovered a total of $268,562,280 on behalf of federal agencies and programs in affirmative civil enforcement cases during the last fiscal year. This amount has two components. In addition to its efforts in local civil cases noted above, the district’s Civil Division also joins forces with other U.S. Attorney’s Offices and with the Department of Justice Civil Frauds Section to address fraud schemes and illegal practices extending beyond district boundaries. The MDFL’s Civil Division recovered an additional $188,700,217 in these high profile, jointly handled cases. This represents the second largest recovery amount for a single year in the history of the district.

Additionally, the Office’s Asset Recovery Division, led by Chief Anita Cream, recovered $28,791,743 in asset forfeiture actions last fiscal year. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes. For instance, in FY 2019, nearly $10 million forfeited in the MDFL in this and prior years was returned to victims of the criminal offenses upon which the forfeitures were based, and more than $2.8 million was shared with federal, state, and local law enforcement agencies.

“The coordinated efforts between federal, state, and local partners have resulted in the recovery of millions of dollars from those who have used fraud and other means to violate federal laws,” Chapa Lopez said. “These recovered funds will serve to hold those responsible accountable for their misconduct and offenses, help victims recover from their losses, and assist law enforcement in pursuing justice.”

U.S. attorneys’ offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.

The largest civil collections were from affirmative civil enforcement cases, in which the U.S. recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights, or environmental laws. In addition, civil debts were collected on behalf of several federal agencies, including the U.S. Department of Housing and Urban Development, the U.S. Department of Health and Human Services, the Defense Health Agency, the Internal Revenue Service, the Small Business Administration, and the Department of Education.

See below for MDFL significant civil healthcare fraud enforcement case highlights:

United States v. Regency, Inc.

The MDFL Civil Division, working in parallel with its Asset Recovery Division and Criminal Division, obtained an emergency temporary restraining order and preliminary injunctions that secured a historic $50 million in cash and other valuable property owned by 13 criminal healthcare fraud targets, pending resolution of criminal claims. The asset freeze is the largest of its kind on record. The defendants in this civil case are alleged to have engaged in a vast healthcare fraud scheme that generated a deluge of false claims for unnecessary orthotic braces that were shipped to Medicare beneficiaries. Boiler room call centers “cold called” Medicare beneficiaries and generated leads for store front durable medical equipment companies to exploit. The medical need for the orthotics was certified by internet doctors who had no relationship with the beneficiaries receiving the equipment.

United States v. Jayam Iyer, MD

This civil case was worked in parallel with a criminal prosecution of a Clearwater anesthesiologist who was a national outlier prescriber of opiate medications. The parallel investigation resulted in an indictment and guilty plea for health care fraud that brought a six month prison sentence for the physician. Dr. Iyer also surrendered her DEA registration that permitted her to prescribe controlled substances, and her Florida medical license. She was excluded from participation in Medicare and Florida Medicaid programs, and has agreed to pay $102,126 to resolve civil claims under the False Claims Act.

United States ex rel. Heaphy v. Miraca Life Sciences

A nationwide pathology group paid $63.5 million to resolve claims by two separate whistleblowers that it had provided kickbacks to referring physicians in the form of subsidies for electronic health records and technology consulting.  

United States ex rel. Simon v. HealthSouth, Inc.

A nationwide provider of rehabilitation services paid $48 million to settle allegations by whistleblowers in six separate qui tam cases that the provider had defrauded the Medicare program through false information that distorted the medical conditions of patients in order to gain higher reimbursement from the program.   

Fagron Holding USA, LLC  

A supplier of ingredients used in compounded pain cream medications created by specialty pharmacies agreed to pay $22.05 million to resolve allegations in two qui tam cases that it had defrauded the Department of Defense’s TRICARE program and the federal Workers’ Compensation program through a scheme that falsely inflated the average wholesale price of the ingredients. Because reimbursement depends upon the pricing reported to price listing agencies, the scheme permitted the supplier’s pharmacy customers to bill federal programs for thousands of dollars per prescription more than they were entitled to claim.

Celink

A Michigan based reverse mortgage loan servicer paid $4.25 million to resolve claims that it had improperly claimed interest payments from the Department of Housing and Urban Development’s Federal Housing Administration insurance program. HUD regulations impose specific requirements upon servicers claiming interest, and Celink’s claims to the agency failed to disclose facts that defeated its claims.

United States ex rel. Webb v. Advanced Biohealing

Kevin Rakin, the CEO of a medical device manufacturer, paid $2.5 million to resolve allegations by a qui tam relator that he had conceived and implemented a nationwide kickback scheme that incentivized overutilization of a wound care medical device. In 2017, the manufacturer had settled kickback allegations against it in return for $350 million.

United States ex rel. Hawks v. Heart & Vascular Inst. of Florida

An Orlando area vascular surgeon, Irfan Siddiqui, paid $2.23 million to resolve allegations by one of his patients that he had defrauded Medicare through false claims for medically unnecessary vein ablation services and up-coded evaluation and management services. He also had allegedly falsified patient records to justify claims for reimbursement.

United States ex rel. Oha v. Advanced Pain Management and Spine Specialists

The co-owner of the largest pain management practice in southwest Florida, Dr. Jonathan Daitch, paid $1.7 million to resolve civil fraud claims against him individually, that alleged he had submitted false claims to Medicare for medically unnecessary urine drug testing services. The co-owner of the practice, Dr. Michael Frey, earlier pleaded guilty to having received kickbacks from a local durable medical equipment provider and paid $2.8 million in a separate settlement to resolve civil fraud claims against him arising from kickback practices and for ordering medically unnecessary lab tests.

United States ex rel. de Oca v. Conway Lakes NC, LLC

An Orlando skilled nursing facility, Conway Lakes NC, LLC, along with its former Administrator, Matthew File, its management company, Clear Choice Health Care, LLC, Clear Choice’s part-owner and President, Jeffrey Cleveland, Clear Choice’s part-owner and Senior Vice President, Geoffrey Fraser, and an Orlando-area orthopedic surgeon, Dr. Kenneth Krumins, agreed to pay $1.5 million to resolve a qui tam relator’s allegations that they had engaged in a kickback scheme concerning the referral of Medicare and TRICARE patients. Dr. Krumins received payments under a sham “medical director” agreement to induce him to illegally refer Medicare and TRICARE patients to Conway Lakes for rehabilitation services that were billed to the United States. Dr. Krumins’s settlement agreement also resolves allegations that he engaged in a similar kickback scheme with a related home health agency. 

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