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April 5, 2010


(HOUSTON) – Fred Jessie Cole Jr., of Houston, has pleaded guilty to 14 counts of health care fraud, United States Attorney José Angel Moreno and Texas Attorney General Greg Abbott announced today. Cole, 44, was a co-owner of Crusade Integrated Health Services, a durable medical equipment company located in Houston.

In a hearing before United States District Court Judge Lee H. Rosenthal today, Cole admitted to submitting false and fraudulent claims to the Texas Medicaid Program for incontinence supplies such as diapers and briefs that were not delivered to Medicaid beneficiaries, not wanted by Medicaid beneficiaries and not medically necessary. He also admitted to submitting claims to Medicaid for the delivery of 1,338,466 units of diapers and briefs when he only purchased 314,571 units for delivery and to forging the signatures of Medicaid beneficiaries on delivery tickets to cover up the fact that he was billing Medicaid for more than he was providing. Between May 3, 2003, and Sept. 1, 2006, Cole submitted approximately $1,068,387 worth of claims for diapers and briefs to Medicaid and was paid approximately $937,567 for those claims.

Cole remains free on bond pending his sentencing which is scheduled for Aug. 11, 2010. He faces a maximum of up to 10 years in prison, a fine of up to $250,000 and up to three years of supervised release for the health care fraud convictions.

The investigation into Cole was the result of a joint investigation by agents of the Texas Attorney General Medicaid Fraud Control Unit and the FBI. Special Assistant United States Attorney Julie Redlinger prosecuted the case.




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