Two Men Plead Guilty to Health Care Fraud Scheme
Defendants Admit Scamming Federal Employee Health Insurance Plan, Submitting Over $250,000 in False Claims
WASHINGTON – Russell J. Sveda, 69, and Richard V. Schachter, 56, most recently of Alexandria, Va., and Lauderdale by the Sea, Fla., pled guilty today to charges of health care fraud stemming from a scheme to submit false claims for non-existent medical reimbursements through the U.S. Office of Personnel Management’s Foreign Service Benefit Plan.
The guilty pleas were announced by U.S. Attorney Channing D. Phillips, Patrick E. McFarland, Inspector General for the Office of Personnel Management (OPM), Paul M. Abbate, Assistant Director in Charge of the FBI’s Washington Field Office, and Inspector in Charge David G. Bowers of the U.S. Postal Inspection Service’s (USPIS) Washington, D.C., Division.
Sveda and Schachter, who were indicted in July 2015, pled guilty in the U.S. District Court for the District of Columbia. They are to be sentenced on Jan. 20, 2016, by the Honorable Senior Judge Thomas F. Hogan. Under the advisory sentencing guidelines, they face a possible sentence of 18 to 24 months. They also agreed to pay $257,000 in restitution and to forfeit an identical amount in a money judgment.
According to a statement of offense signed by the government as well as both defendants, Sveda is a former U.S. State Department employee, now retired. He is entitled to participate in the Federal Employee Health Benefit Program, the federally-funded health benefit program provided by the U.S. government for federal employees, retirees, and their eligible spouses and dependents. State Department Foreign Service employees and retirees, like Sveda, and federal employees living overseas, have the option of choosing the Foreign Service Benefit Plan of Washington, D.C., as their health insurance plan. Participants of this plan, like Sveda, pay for medical services and medications up front and then submit claims via facsimile or mail and are reimbursed by a check sent through the U.S. Postal Service or a payment electronically transferred into their bank account.
Schachter is Sveda’s spouse and has acted on behalf of Sveda in demanding payments for medical insurance claims. Between February 2007 and October 2010, Sveda and Schachter submitted to the insurance carrier for Foreign Service Benefit Plan claims for pharmaceutical items and services purportedly obtained from a German pharmacy, Stadt-Apotheke Fussen, located in Fussen, Germany. Similarly, from May 2007 through October 2012, Sveda and Schachter submitted claims for medical services Sveda allegedly obtained from various German doctors, clinics, and hospitals. Sveda’s claims used the names and addresses of various doctors, clinics, hospitals, and pharmacies, and other health care service providers, located in Germany.
Since at least 2007, Sveda and Schachter have engaged in extensive foreign travel and extended stays at spas. Government travel records — such as passport stamps and the U.S. government’s records of border crossings — as well as documents obtained from airlines, ocean line operators, credit and debit card payments, and a major spa company, establish that Sveda was traveling across the Atlantic, receiving spa treatments in Massachusetts, or otherwise traveling outside of Germany on the dates when Sveda and Schachter claimed Sveda was in Germany receiving medical services from doctors, clinics, hospitals, or other health care providers. Based on information the government has received to date, $257,000 of those claimed medical services, purportedly performed in Germany, are known to be false based on dates when travel and other records establish that Sveda was not in Germany.
In announcing the guilty pleas, U.S. Attorney Phillips, Inspector General McFarland, Assistant Director in Charge Abbate, and Inspector in Charge Bowers expressed appreciation for the work performed by Special Agents and analysts from OPM’s Office of Inspector General and the FBI, as well as by Postal Inspectors and analysts with the U.S. Postal Inspection Service. They also acknowledged the efforts of those who are working on the case from the U.S. Attorney’s Office, including Paralegal Specialists Donna Galindo, Kristy Penny, John Lowell, Jessica Mundi, and Corinne Kleinman, Assistant U.S. Attorneys Ted Radway and Diane Lucas, and Assistant U.S. Attorney Virginia Cheatham, who is prosecuting the case.