Sheppard Pratt Director and Her Husband Charged in Illegal $2.5 Million Billing Scheme
Allegedly Used Jointly Operated Company to Submit over 150 False Invoices Without Disclosing Conflict of Interest
Baltimore, Maryland – A federal grand jury has indicted Lyneth Nyabiosi, age 49, and her husband, Willie Evans III, a/k/a “James Davies” and “James Davis,” age 53, both of Bear, Delaware, on charges arising from a scheme to falsely bill Nyabiosi’s employer, Sheppard Pratt Health Systems, for approximately $2.5 million for work purportedly performed by a company that the defendants secretly controlled. The indictment was returned on June 16, 2015 and unsealed today following the arrest of the defendants.
The indictment was announced by United States Attorney for the District of Maryland Rod J. Rosenstein and Special Agent in Charge Stephen E. Vogt of the Federal Bureau of Investigation.
Sheppard Pratt Health System is a private, non-profit health system in Maryland which offers mental health, substance use and special education services. Sheppard Pratt’s main campus is located at 6501 North Charles Street, Towson, Maryland. From November 2005 to September 2014, Nyabiosi was the director of the Health Information Management Department (HIM Department) of Sheppard Pratt. The department was responsible for receiving, organizing and storing patient medical records. As the director, Nyabsiosi was the highest ranking employee in the HIM Department.
According to the eight count indictment, Nyabiosi and Evans controlled and operated an entity named Information Management Solutions Technology (IMST), which purported to specialize in record management. On March 7, 2007, Nyabiosi, on behalf of Sheppard Pratt, entered into a contract with IMST to manage medical records for Sheppard Pratt, in violation of Sheppard Pratt’s conflict of interest policy. From 2006 to October 2014, and to conceal the inherent conflict of interest, the defendants falsely represented to Sheppard Pratt and others that IMST was operated by an account representative named “James Davis” and “James Davies,” when in fact no such person was employed by IMST.
The indictment further alleges that from 2007 to August 2014, the defendants submitted over 150 false invoices requesting that Sheppard Pratt pay IMST approximately $2.5 million. The invoices requested payment for work which was never performed, or for excessively inflated amounts for the work that was actually performed. For example, the invoices and other documents provided to Sheppard Pratt falsely represented that IMST stored and then shredded hundreds of thousands of boxes of sensitive medical records, when in fact IMST had stored substantially less. Nyabiosi, nonetheless personally approved all of the false invoices, thus causing Sheppard Pratt to mail checks to IMST totaling approximately $2.5 million. The defendants deposited the money in their bank account and used the money for personal expenditures, including loan and mortgage payments; home renovations and upgrades; personal wire transfers to Africa; and vehicle, food, clothing and entertainment expenses.
The indictment seeks forfeiture of $2.6 million, two residences located in Bear and Newark, Delaware and three vehicles.
The defendants face a maximum sentence of 20 years in prison for each of the eight counts of conspiring to commit mail fraud and mail fraud. An initial appearance was held for Nyabiosi yesterday and for Evans today in U.S. District Court in Baltimore. The defendants were released on home confinement and under the supervision of U.S. Pretrial Services.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Rod J. Rosenstein praised the FBI for its work in the investigation and thanked Assistant United States Attorney David I. Sharfstein, who is prosecuting the case.