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Justice News

Department of Justice
U.S. Attorney’s Office
Central District of California

FOR IMMEDIATE RELEASE
Monday, October 2, 2017

Owner-Operator of Burbank Clinic that Prescribed Unnecessary Services and Submitted Fraudulent Claims as Part of Scheme to Defraud Medicare Sentenced to 37 Months in Federal Prison

          LOS ANGELES – The owner-operator of a Burbank medical clinic was sentenced today to 37 months in federal prison on federal healthcare fraud charges for participating in a scheme to defraud Medicare by prescribing unnecessary services and equipment, which often were not even provided.

          Knarik Vardumyan, 53, of Burbank, who formerly owned and operated the medical clinic, was sentenced by United States District Judge Dale S. Fischer who also ordered Vardumyan to pay $1,711,789 in restitution to the Centers for Medicare & Medicaid Services.

          Vardumyan pleaded guilty in April to two counts of federal healthcare fraud.

          According to court documents, Vardumyan admitted that she knowingly and unlawfully participated in a scheme to defraud Medicare by billing Medicare for “medically unnecessary office visits and diagnostic tests,” and by arranging “for the issuance of . . . prescriptions and orders for medically unnecessary durable medical equipment” and “home health services.” Vardumyan further admitted, “many, if not all” of the people who visited her clinic “were brought . . . by co-schemers known as ‘marketers,’ who offered promises of free, medically unnecessary [equipment] or food” to those Medicare beneficiaries who were willing to attend Vardumyan’s clinic.

          In documents filed in relation to today’s sentence, the government noted that Medicare paid $1,711,789 as a result of this fraudulent scheme, and that a 37-month term of imprisonment appropriately reflects the nature and circumstances of the offense, as well as the need for the sentence to “promote respect for the law and afford adequate deterrence against this kind of serious fraud against our healthcare system and the public fisc.”

          The case against Vardumyan was investigated by the Federal Bureau of Investigation and Assistant United States Attorneys Kristen Williams, Cathy J. Ostiller, and Julian André of the Major Frauds Section and prosecuted by Assistant United States Attorney Adam P. Schleifer.

Contact: 
Thom Mrozek Spokesperson/Public Affairs Officer United States Attorney’s Office Central District of California (Los Angeles) 213-894-6947
Press Release Number: 
17-176
Updated October 2, 2017