Federal Judge Hands Down Prison Sentences To Two Women For Using Stolen Identities To Claim Millions Of Dollars From Medicaid In Related Health Care Fraud Schemes
United States Attorney Anne M. Tompkins Western District Of North Carolina
CHARLOTTE, N.C. – Two women who defrauded Medicaid of millions of dollars using stolen therapists’ identities in related health care fraud schemes have been sentenced to prison by a federal judge in Charlotte, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.
On Wednesday, April 9, 2014, Chief U.S. District Judge Frank D. Whitney sentenced Victoria Finney Brewton, 39, of Shelby, N.C. to 111 months in prison, to be followed by three years of supervised release for defrauding Medicaid of $8 million in false reimbursement claims for sham mental and behavioral health services. Judge Whitney also ordered Brewton to pay $7,070,426.52 as restitution to Medicaid and $573,392.80 to IRS.
On Tuesday, April 8, 2014, Judge Whitney sentenced one of Brewton’s conspirators, Rodnisha Sade Cannon, 27, of Charlotte to 102 months in prison for a similar scheme also involving sham mental and behavioral health services. Judge Whitney also ordered Cannon to serve three years under court supervision and to pay restitution in the amount of $2,541,306.36.
Cannon initially worked as a patient recruiter for Brewton, providing Brewton with the personal information of Medicaid recipients, which Brewton then used to file fraudulent reimbursement claims with Medicaid. Cannon later began running her own similar health care fraud scheme, that attempted to defraud Medicaid of $4.8 million in fraudulent reimbursement claims using the stolen identities of patients and therapists.
According to court documents and court proceedings, from 2008 to 2012, Brewton operated a series of after-school and summer childcare programs in Shelby. Brewton recruited juvenile Medicaid beneficiaries through their families to sign up for these programs, promising the programs would be free for Medicaid recipients. Court records show that Brewton stole the Medicaid recipient numbers of some of the children and families who had signed up for the programs and fraudulently billed Medicaid for mental and behavioral health services which were never provided. Brewton was not licensed or qualified to provide mental and behavioral health services nor was she a Medicaid-approved provider, court documents show. According to court records, Brewton submitted the fraudulent reimbursement claims through other Medicaid-approved providers, some of whom did not know their information had been compromised.
Court records show that one such provider was a licensed therapist (“K.S.M.”) hired by Brewton to provide mental and behavioral health services for her company, Healing Hearts. Brewton submitted false and fraudulent claims to Medicaid using K.S.M.’s Medicaid provider number far in excess of the services actually provided by K.S.M, and continued to submit fraudulent claims even after K.S.M. was no longer employed by Brewton. According to court documents, Brewton also misused the Medicaid provider numbers of other therapists employed by her company and submitted false claims to Medicaid through their numbers. Court records indicate that Brewton also failed to report to IRS the income derived from her fraudulent scheme. In January 2013, Brewton pleaded guilty to health care fraud and health care fraud conspiracy, aggravated identity theft and filing false tax returns.
According to court documents and court proceedings, beginning in 2010 to 2012, Cannon created two companies, (“2nd Chances” and “A Chance for Change, Inc.”), and began operating after-school and summer childcare programs in Gastonia and Shelby. Although therapists initially performed some services at these programs, Cannon and others used the Medicaid provider numbers of other companies and individual therapists to submit fraudulent claims to Medicaid for therapy services supposedly provided at Cannon’s programs. Court records reflect that in many instances, the claimed mental and behavioral health services were never provided at all.
Court documents indicate that Cannon, who was not licensed or qualified to provide mental and behavioral health services and was not approved by Medicaid, stole the identities of Medicaid-approved providers who had some relationship with her programs. For example, court documents indicate that in May 2012, Cannon hired “M.B.,” who was a licensed clinical social worker, to work for her company. M.B. worked for Cannon’s company for a single day. Court records show that Cannon and her conspirators stole M.B.’s Medicaid provider information and used it to file more than $800,000 in fraudulent claims for services that M.B. never provided, including claims for dates of service before M.B. worked for Cannon.
According to court records, after opening her own companies, Cannon continued to provide and sell to Brewton Medicaid beneficiary identification numbers and information to be used in Brewton’s fraud scheme. In total, Cannon and her conspirators submitted approximately $4.8 million in false claims and received over $2.5 million as payment on those claims from Medicaid. Cannon pleaded guilty in April 2013 to health care fraud conspiracy, aggravated identity theft and money laundering conspiracy. Cannon also pleaded guilty to attempting to remove property subject to seizure, namely a 2010 Mercedes-Benz CLS550.
According to court records, Cannon purchased the Mercedes-Benz for $59,500 with the proceeds of her fraud scheme. When law enforcement obtained a warrant to seize the Mercedes-Benz, Cannon attempted to sell the vehicle to avoid its seizure. Cannon has been in local federal custody since her arrest on the attempted removal of property to prevent seizure charge in September 2012 and will be transferred to the custody of the Federal Bureau of Prisons upon designation of a federal facility.
Brewton has been released on bond and will be ordered to self-report to the Federal Bureau of Prisons to begin serving her sentence. All federal sentences are served without the possibility of parole.
In making today’s announcement U.S. Attorney Tompkins thanked North Carolina’s Medicaid Investigations Division (MID) under the direction of Attorney General Roy Cooper, the Charlotte Division of the FBI, under the direction of Special Agent in Charge John A. Strong, the Internal Revenue Service, Criminal Investigation Division (IRS-CI) under the direction of Special Agent in Charge Jeannine A. Hammett, and the Department of Health and Human Services, Office of the Inspector General (HHS-OIG), Office of Investigations, Atlanta Region, under the direction of Special Agent in Charge Derrick Jackson, for their investigation leading to Brewton and Cannon’s prosecutions. She also thanked the North Carolina Division of Medical Assistance, Program Integrity Section for their invaluable assistance in Brewton’s case.
The prosecution was handled by Assistant U.S. Attorneys Kelli Ferry and Jenny Grus Sugar of the U.S. Attorney’s Office in Charlotte.
The investigation and charges are the work of the Western District’s joint Health Care Fraud Task Force. The Task Force is multi-agency team of experienced federal and state investigators, working in conjunction with criminal and civil Assistant United States Attorneys, dedicated to identifying and prosecuting those who defraud the health care system, and reducing the potential for health care fraud in the future. The Task Force focuses on the coordination of cases, information sharing, identification of trends in health care fraud throughout the region, staffing of all whistleblower complaints, and the creation of investigative teams so that individual agencies may focus their unique areas of expertise on investigations. The Task Force builds upon existing partnerships between the agencies and its work reflects a heightened effort to reduce fraud and recover taxpayer dollars.
If you suspect Medicare or Medicaid fraud please report it by phone at 1-800-447- 8477 (1-800-HHS-TIPS), or E-Mail at HHSTips@oig.hhs.gov. To report Medicaid fraud in North Carolina, call the North Carolina Medicaid Investigations Division at 919-881-2320.