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Press Release

Southern California Medical Supply Company Owner Sentenced to Four Years in Prison for $8.3 Million Medicare Fraud Scheme

For Immediate Release
Office of Public Affairs

A registered nurse who owned a medical supply company was sentenced today in Los Angeles to four years in federal prison for her role in an $8.3 million Medicare fraud scheme.

Assistant Attorney General Leslie R. Caldwell of the Criminal Division, Acting U.S. Attorney Stephanie Yonekura of the Central District of California, Special Agent in Charge Glenn R. Ferry of the U.S. Department of Health and Human Services, Office of Inspector General’s (HHS-OIG) Los Angeles Region, Assistant Director in Charge David L. Bowdich of the FBI’s Los Angeles Field Office and Special Agent in Charge Erick Martinez of the IRS-Criminal Investigation’s Los Angeles Field Office made the announcement.

Olufunke Ibiyemi Fadojutimi, 43, of Carson, California, was convicted by a jury on July 31, 2014, of conspiracy to commit health care fraud, seven counts of health care fraud and one count of money laundering.  In addition to the prison term, U.S. District Judge Christina A. Snyder of the Central District of California ordered Fadojutimi was ordered to pay restitution in the amount of $4,372,466, jointly and severally with a co-defendant.

During trial, the evidence showed that Fadojutimi, a registered nurse and the former owner of Lutemi Medical Supply, fraudulently billed Medicare for more than $8 million of durable medical equipment that was not medically necessary.  The evidence specifically showed that, between September 2003 and May 2010, Fadojutimi and others paid cash kickbacks to patient recruiters in exchange for patient referrals, and additional kickbacks to physicians for fraudulent prescriptions for medically unnecessary durable medical equipment, such as power wheelchairs.  Fadojutimi and others then used these prescriptions to support fraudulent claims to Medicare. 

As a result of this fraud scheme, Fadojutimi and others submitted approximately $8.3 million in false and fraudulent claims to Medicare, and received almost $4.3 million on those claims.    

The case was investigated by the FBI, IRS, and HHS-OIG’s Los Angeles Regional Office, and 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.  The case was prosecuted by Trial Attorneys Fred Medick and Blanca Quintero of the Criminal Division’s Fraud Section. 

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged nearly 2,100 defendants who have collectively billed the Medicare program for more than $6.5 billion.  In addition, HHS’s Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, is 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:

Updated May 13, 2015

Health Care Fraud
Press Release Number: 15-609