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Press Release

Owners of Suburban Youth Counseling Center Indicted on Fraud Charges for Allegedly Defrauding Illinois Medicaid out of $4 Million

For Immediate Release
U.S. Attorney's Office, Northern District of Illinois

CHICAGO — The owners of a suburban Chicago youth counseling center defrauded Illinois Medicaid out of approximately $4 million through a fraudulent billing scheme, according to an indictment returned in federal court.

From 2011 to 2018, SUMMER MATHESON and TERRENCE EWING, co-owners of Laynie Foundation Inc., along with foundation employee RICHARD GRUNDY, fraudulently billed Illinois Medicaid for more mental health counseling services than the foundation actually provided, the indictment states.  Matheson, Ewing and Grundy also used the Matteson-based foundation to seek payment from Illinois Medicaid for non-reimbursable activities, such as internal case reviews, staff training, clinical supervision and recordkeeping, the indictment alleges.  The indictment additionally accuses Matheson of attempting to cover up the fraud by directing foundation personnel to backdate and falsify patient records to make it appear that a licensed practitioner had reviewed and approved certain mental health services, when, in fact, Matheson knew that a practitioner had not reviewed and approved those services.  As a result of the fraud, Matheson, Ewing and Grundy fraudulently obtained approximately $4 million from Illinois Medicaid and managed-care organizations used by Illinois Medicaid, the indictment states.

The indictment was returned Tuesday.  It charges Matheson, 41, and Ewing, 57, both of Dyer, Ind., with six counts of health care fraud.  Matheson is also charged with one count of obstruction of justice.  Grundy, 34, of Chicago, is charged with five counts of health care fraud.  Arraignments in U.S. District Court in Chicago have not yet been scheduled.

The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Lamont Pugh III, Special Agent-in-Charge of the Chicago Region of the U.S. Department of Health and Human Services Office of Inspector General; and Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the FBI.  The Illinois Attorney General’s Office and Illinois State Police assisted in the investigation.  The government is represented by Assistant U.S. Attorneys Prashant Kolluri and Charles W. Mulaney.

The U.S. Attorney’s Office and Illinois Attorney General’s Office previously intervened in a civil lawsuit that a private citizen filed against the foundation pursuant to the qui tam, or whistleblower, provisions of the False Claims Act.  The lawsuit is pending in federal court.

Medicaid is a state-administered program, and each state sets its own guidelines regarding eligibility and services.  For Illinois Medicaid recipients, funding is shared between the federal government and the State of Illinois.

The public is reminded that an indictment is not evidence of guilt.  The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.  The obstruction count is punishable by up to 20 years in prison, while each health care fraud count carries a maximum sentence of ten years.  If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.

Updated August 28, 2019

False Claims Act
Health Care Fraud