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Justice News

Department of Justice
U.S. Attorney’s Office
District of New Jersey

Friday, February 12, 2016

New Jersey Doctor, Two Companies Agree To Pay $5.25 Million For Allegedly Submitting Bogus Claims To Federal Health Care Programs

NEWARK, N.J. – Dr. Labib E. Riachi, 47, of Westfield, New Jersey, and two companies that he owns and operates, Riachi, Inc. and Center for Advanced Pelvic Surgery, LLC, both based in Westfield, have agreed to pay $5.25 million to resolve allegations that they falsely billed federal health care programs for tests that were never provided, among other claims, U.S. Attorney Paul J. Fishman announced today.

The settlement resolves allegations that the defendants routinely billed Medicare and Medicaid for anorectal manometry, an invasive diagnostic test, and electromyography, another diagnostic test, even though most of the tests were never performed. In addition, the settlement resolves claims that the defendants submitted claims to Medicare for physical therapy services that should not have been paid because they were not performed by a qualified therapist.

The allegations resolved by today’s settlement were raised in a civil lawsuit that the government filed on Feb. 10, 2016, in Newark federal court charging the defendants with violating the False Claims Act, among other illegal conduct.

U.S. Attorney Fishman credited special agents of the U.S. Department of Health and Human Services, Office of the Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, and the FBI, under the direction of Acting Special Agent in Charge Andrew Campi in Newark, with the investigation leading to the settlement.

The government is represented by Assistant U.S. Attorneys Bernard J. Cooney and Lucy Muzzy of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark.

U.S. Attorney Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $645 million in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes.

The claims settled by this agreement are allegations only, and there has been no determination of liability. The case is captioned United States v. Riachi, et al. (D.N.J.).

Defense counsel: Bruce Levy Esq. and Larry Lustberg Esq., Newark

Healthcare Fraud
Updated February 12, 2016