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Wednesday, October 27, 2010

Los Angeles Patient Recruiter Known as the “Red, White & Blue Man” Sentenced to 21 Months in Prison for Medicare Fraud Scheme

WASHINGTON – A patient recruiter who sold the personal information of Medicare beneficiaries from San Diego and Los Angeles to fraudulent Los Angeles medical clinics and durable medical equipment (DME) companies was sentenced late yesterday to 21 months in prison in connection with a scheme to defraud Medicare, the Departments of Justice and Health and Human Services (HHS) announced.


James Roland Fuquay, 49, was also ordered to pay $556,815 in restitution by U.S. District Judge John F. Walter of the Central District of California. In addition, Fuquay was ordered to serve three years of supervised release following his prison term.


Fuquay pleaded guilty on May 11, 2009, to conspiracy to commit health care fraud. According to court documents, Fuquay was a patient recruiter known as the “Red, White & Blue Man,” which is a reference to the colors on a Medicare card. Fuquay in fact recruited Medicare beneficiaries from homeless shelters in San Diego and Los Angeles using the sales pitch, “Red, white, and blue. Let’s make it do what it do.” Fuquay then paid the beneficiaries to go with him to fraudulent medical clinics and DME supply companies to receive medical services, power wheelchairs, hospital beds and other medical equipment the beneficiaries did not want, need or receive. Fuquay’s network of Medicare beneficiaries and fraudulent DME supply companies was large enough for him to make approximately $220,000 in illegal recruiter fees.


According to court documents, one of the fraudulent DME supply companies that paid Fuquay to recruit beneficiaries was Airport Medical Supply, whose owner, Eli Gichon, pleaded guilty on Sept. 1, 2010, to health care fraud and tax charges. According to court documents, Airport Medical Supply operated out of a dry cleaning business where Gichon directed Fuquay and others to bring beneficiaries so that Gichon could take pictures of them sitting in power wheelchairs or standing next to empty hospital bed boxes. Gichon used these pictures to try to fraudulently prove to Medicare inspectors that he had in fact provided the beneficiaries with power wheelchairs and hospital beds. Gichon’s sentencing is scheduled for Jan. 10, 2011.


The sentencing was announced by Assistant Attorney General Lanny A. Breuer of the Criminal Division; U.S. Attorney André Birotte Jr. for the Central District of California; Tony Sidley, Assistant Chief of the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse; Glenn R. Ferry, Special Agent-in-Charge for the Los Angeles Region of the Office of Inspector General for HHS (HHS-OIG); and Steven Martinez, Assistant Director in Charge of the FBI’s Los Angeles Field Office


The case was prosecuted by Assistant U.S. Attorney April Christine of the Central District of California with the assistance of Trial Attorney Jonathan T. Baum of the Criminal Division’s Fraud Section. The case was investigated by FBI and HHS-OIG. The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California.

Since their inception in March 2007, Strike Force operations in seven districts have obtained indictments of more than 825 individuals who collectively have falsely billed the Medicare program for more than $2 billion. In addition, HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to: www.stopmedicarefraud.gov .

Press Release Number: 
Updated September 15, 2014