Winston-Salem Couple Sentenced
Health Care Fraud and Tax Offenses Draw 24 Month Sentences
Greensboro, N.C. – United States Attorney Ripley Rand announced that Ruben D. McLain, age 40, and Michelle Judge McLain, age 38, both of Winston-Salem, North Carolina, were sentenced yesterday in federal court. The McLains were each sentenced to 24 months incarceration and three years of supervised release. They were also ordered to pay restitution of $1,313,671.14 jointly and severally to the Internal Revenue Service.
The McLains were initially charged in a multi-count Indictment filed September 27, 2010. On January 24, 2011, the McLains entered pleas of guilty to Count One, conspiracy to defraud the United States, Count Nine, failure to pay over withholding taxes, Count Twelve, health care fraud, and Count Twenty-Five, tax evasion. In addition, Michelle Judge McLain entered a plea of guilty to Count Eight, false entries involving a health care benefit program.
The McLains did business in Winston-Salem as Universal Services, Inc., Reynolds Home Care, and Triage Behavioral Health Systems. The factual basis filed at the time of the plea indicated that the McLains established a bank account for Universal Services, Inc., using a false tax identification number. The factual basis further revealed that the defendants used business bank accounts to purchase personal items for their home, to pay school tuition for their children, and to purchase jewelry. The McLains also pleaded guilty to charges that, from 2004 through 2007, they either failed to file tax returns or filed false tax returns that did not declare their true income.
The McLain companies provided personal care and mental health services to qualified recipients, paid for by the Medicaid program. The McLains pleaded guilty to submitting a false enrollment application to the North Carolina Division of Medical Assistance that concealed their involvement in the companies through the use of a nominee and a fictitious person.
The McLains also pleaded guilty to withholding income, social security, and Medicare taxes from their employees’ wages without paying over those withholdings to the Internal Revenue Service.
The case was investigated by Special Agents of the Internal Revenue Service Criminal Investigation Division, the Department of Health and Human Services Office of Inspector General, and the North Carolina Medicaid Fraud Unit. The case was prosecuted by Assistant United States Attorney Robert Hamilton.
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