Woman Pleads Guilty to Defrauding Non-Profit Organization
NORFOLK, Va. – A Newport News woman pleaded guilty today to her role in a conspiracy to defraud the Patient Advocate Foundation (PAF), a non-profit corporation that provides case management services and financial aid to Americans with chronic, life-threatening, and debilitating illnesses.
According to court documents, Andrea Braxton Wallace, 39, was a PAF employee assigned to work with their Co-Pay Relief Program. The program is designed to help low-income individuals pay for medications and treatments associated with certain diagnosed illnesses, such as Hepatitis C, various cancers, and HIV/AIDS. Eligibility for the program is based upon an individual’s diagnosed illness and annual household income. If approved, a PAF patient is awarded a grant (typically ranging from $12,000 to $25,000 per year) against which they can make claims for reimbursement for medications and treatments attendant to their disease.
The scheme, which was run by a group of PAF employees and several “outsiders”, involved creating fake patient accounts with false diagnoses, then making false claims for reimbursement against the grants that were awarded. Once the reimbursement checks were cut, the co-conspirators would cash them and split the proceeds. Wallace was employed as a Verification Specialist at PAF. She recruited two outsiders to create fake applications, cash checks, and otherwise participate in the scheme. She was the direct cause of about $35,000 in losses to PAF.
Wallace pleaded guilty to conspiracy to commit health care fraud and faces a maximum penalty of 10 years in prison when sentenced on July 11. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Martin Culbreth, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after U.S. Magistrate Judge Douglas E. Miller accepted the plea. Assistant U.S. Attorney V. Kathleen Dougherty is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:19-cr-35.
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