Business Crimes Hotline

Florida

Another Jury Verdict for the Medicare Fraud Strike Force

In August 2007, the Department of Justice Medicare Fraud Strike Force reported its fourth Medicare fraud conviction in the last six months, with a jury verdict against Marianela Smith, the owner-operator of Smith Medical Equipment, Inc. and an assisted living facility, M.P. Residence Inc. As reported, the facts presented at trial included evidence of kick-backs to physicians and patients, as well as a conspiracy with pharmacy owners that resulted in more than $271,000 in phony prescriptions billed to Medicare, for which Smith received more than $81,000 in kickbacks. As reported, the jury found Smith guilty on all counts including conspiracy to defraud the U.S. government, to submit false claims to Medicare, and to receive kickbacks; conspiracy to commit health care fraud; and three counts of receiving kickbacks in exchange for referring patients to a co-conspirator pharmacy. United States v. Marianela Smith, 1:07cr20283 (S.D. Fla. 2007); see also Press Release, Department of Justice, #07-67, Owner and Operator of Florida Durable Medical Equipment Company Convicted of Medicare Fraud, (Aug. 31, 2007).

California

Bank Pays $36.1 Million for Failure to Maintain Effective Anti-Money Laundering Program

On Sept. 17, 2007, UnionBanCal Corporation's, subsidiary Union Bank of California, N.A. consented to the filing of an information and entered into a deferred-prosecution agreement for a violation of the Bank Secrecy Act, for failing to maintain an effective anti-money laundering program. The company's resolution includes a $26.1 million forfeiture settlement, required implementation of anti-money laundering measures, as well as $10 million in concurrent civil penalties by both the Financial Crimes Enforcement Network, and the Office of the Comptroller of the Currency; resulting in a grand total of $36.1 million. The charges relate to activity in Union Bank of California accounts held by certain Mexican currency exchange houses. Specifically, through undercover operations and investigation, authorities identified monies in these accounts as proceeds resulting from the export of cocaine from Colombia to Mexico, with ultimate intended destinations in the U.S. and Europe. According to authorities, these suspicious transactions were not detected, identified or reported, as required by the Act, because of deficiencies in the company's anti-money laundering program. United States v. Union Bank of California, N.A., 3:07cr02566, (S.D. Cal. Sept. 17, 2007).

Florida

Another Jury Verdict for the Medicare Fraud Strike Force

In August 2007, the Department of Justice Medicare Fraud Strike Force reported its fourth Medicare fraud conviction in the last six months, with a jury verdict against Marianela Smith, the owner-operator of Smith Medical Equipment, Inc. and an assisted living facility, M.P. Residence Inc. As reported, the facts presented at trial included evidence of kick-backs to physicians and patients, as well as a conspiracy with pharmacy owners that resulted in more than $271,000 in phony prescriptions billed to Medicare, for which Smith received more than $81,000 in kickbacks. As reported, the jury found Smith guilty on all counts including conspiracy to defraud the U.S. government, to submit false claims to Medicare, and to receive kickbacks; conspiracy to commit health care fraud; and three counts of receiving kickbacks in exchange for referring patients to a co-conspirator pharmacy. United States v. Marianela Smith, 1:07cr20283 (S.D. Fla. 2007); see also Press Release, Department of Justice, #07-67, Owner and Operator of Florida Durable Medical Equipment Company Convicted of Medicare Fraud, (Aug. 31, 2007).