Operators Of A Mental Health Provider Indicted On Health Care Fraud And Tax Evasion Charges
A federal grand jury sitting in Greensboro, North Carolina returned an indictment, which was unsealed today, charging the operators of a mental health provider with multiple crimes related to the submission of false claims to Medicaid and tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
Catinia Farrington and Haydn Thomas, both formerly of Durham, North Carolina, are charged with conspiracy to commit health care fraud, health care fraud, aggravated identity theft, and tax evasion. Thomas is also charged with one count of money laundering.
According to the indictment, Farrington owned Durham County Mental Health and Behavioral Health Services LLC (“DCMBHS”) in Durham, North Carolina. From 2011 through 2015, Farrington, along with Thomas, allegedly submitted thousands of false claims to Medicaid that resulted in Medicaid paying over $4 million to DCMBHS. During the relevant period, Thomas worked as an office manager for an oral surgeon. Thomas and Farrington allegedly obtained the Medicaid numbers of dental patients and then submitted false claims to Medicaid for mental health services that were not performed without the permission of the patients.
The indictment further alleges that Farrington and Thomas diverted millions of dollars from DCMBHS for their own personal use and evaded income taxes by, among other things, transferring money to various business bank accounts and paying personal expenses from the business bank accounts.
If convicted, Farrington and Thomas face a statutory maximum of 10 years in prison for each count of health care fraud, 10 years in prison for conspiracy to commit health care fraud, two years in prison for each count of aggravated identity theft, and five years in prison for each count of tax evasion. Farrington and Thomas also face a period of supervised release, restitution, and monetary penalties. An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Principal Deputy Assistant Attorney General Zuckerman and United States Attorney Martin commended special agents of the Internal Revenue Service, the U.S. Department of Health and Human Service, Office of Inspector General, and the Medicaid Investigations Division of the North Carolina Attorney General’s Office (MID), who conducted the investigation, and Assistant United States Attorney Robert Hamilton, Trial Attorney Mara Strier of the Tax Division, and Special United States Attorney Michael Heavner MID, who are prosecuting the case.