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Justice News

Department of Justice
U.S. Attorney’s Office
Eastern District of Tennessee

FOR IMMEDIATE RELEASE
Monday, November 17, 2014

Cleveland Doctor Pleads Guilty To Defrauding Medicare

CHATTANOOGA, Tenn.– On Friday, Nov. 14, 2014, Dr. Raymond Sean Brown, 44, of McDonald, Tenn., pleaded guilty to using misbranded drugs with the intent to defraud Medicare.

Brown was initially charged in a 35-count indictment alleging crimes involving wire fraud, mail fraud, health care fraud and money laundering. However, Brown ultimately agreed to plead guilty to an information charging him with the use of misbranded drugs with the intent to defraud. As part of the plea agreement, Brown also agreed to forfeit $6.765 million U.S. currency seized from his bank accounts in December 2012, and pay an additional $717,000 in cash.

Sentencing is set for Mar. 5, 2015, in U.S. District Court in Chattanooga, at which time the United States will move to dismiss the original indictment.

The plea agreement on file with the U.S. District Court states that from May 2008 until December 2012, Brown fraudulently billed Medicare for Botox injections he did not give. During that time period, he received $7,482,968 in reimbursement from Medicare for Botox injections. Additionally, between 2008 and 2012, Brown did not purchase any FDA approved Botox and only 254 vials of non-FDA approved Botox, but billed Medicare for 17,766 vials. By pleading guilty Brown admitted that he received the Botox in interstate commerce for delivery for pay which was misbranded and that he acted with intent to defraud or mislead.

Brown faces a term of up to three years in prison, a fine of up to $250,000 or twice the amount of the gross pecuniary gain, and supervised release of up to one year. In the Agreed Preliminary Order of Forfeiture filed in U.S. District Court today, Brown agreed to forfeit his interest in $186,091 in a Tennessee Valley Federal Credit Union account and $6,579,517 in an Athens Federal Credit Union account. He also agreed to pay a monetary judgment in the amount of $717,359.08.

This case was investigated by the U.S. Food and Drug Administration-Office of Criminal Investigation and the U.S. Department of Health and Human Services-Office of Inspector General. Assistant U.S. Attorney Terra L. Bay represents the United States.

Updated March 18, 2015