Former Dental Clinic Owner Sentenced for Payroll Tax Fraud Scheme
Wife Sentenced Earlier for $885,000 Medicaid Fraud
SPRINGFIELD, Mo. – A Marshfield, Missouri, man whose wife was sentenced earlier for her role in a Medicaid fraud scheme involving their dental clinics was sentenced in federal court today for failing to pay over payroll taxes and collecting unemployment benefits he wasn’t entitled to receive.
Lorin G. Van Drie, 61, was sentenced by U.S. District Judge M. Douglas Harpool to two years and eight months in federal prison without parole. The court also ordered Van Drie to pay restitution in an amount yet to be determined.
Van Drie and his wife, Pamela M. Van Drie, 60, were convicted at trial on Feb. 20, 2019, of all 40 counts contained in a federal indictment. Lorin Van Drie was convicted of stealing public money, participating in a conspiracy to defraud the government, and 18 counts of failing to pay over employment taxes. Pamela Van Drie was sentenced on Oct. 9, 2019, to four years and nine months in federal prison without parole. The court also ordered her to pay $1,139,794 in restitution.
Lorin and Pamela Van Drie were the owners of All About Smiles, LLC, a Springfield company that provided dental services at clinics in Springfield (until it closed in November 2015), Mountain Grove, Missouri (until it closed in October 2014), and Bolivar, Missouri (until it closed in March 2014). They also owned PL Family Management Company, LLC, which managed the staff for those clinics.
Lorin and Pamela Van Drie participated in a conspiracy to defraud the government by failing to pay over to the IRS payroll taxes from Jan. 31, 2013, to Jan. 31, 2015. Although payroll taxes were withheld from the paychecks of employees at All About Smiles and PL Family Management Company, the Van Dries failed to pay over to the IRS approximately $194,751 in payroll taxes.
The Van Dries diverted a substantial amount of money from their businesses during this period. According to court documents, they lived a lavish lifestyle while some of their employees’ paychecks bounced. Rather than paying the payroll taxes due and owing, the Van Dries purchased and made payments on a 2013 Tracker boat and trailer, a recreational vehicle, multiple vehicles (including a 2010 Hummer and a 2009 Mercedes), several utility trailers, two golf carts, a motorcycle, expensive diamond jewelry, expenses associated with two homes and family vacations in Florida, and a pulling truck called “Momma’s Money,” which their son used in pulling competitions throughout Missouri.
In addition to the payroll tax conspiracy, Lorin Van Drie was found guilty of 18 counts of failure to pay over employment tax. Lorin Van Drie also was found guilty of one count of theft of public money related to $26,880 in unemployment benefits that he was not entitled to receive from October 2010 through June 2012. During that time, he was working at his own construction company (LVD Construction) and being paid to do maintenance at their dental clinics.
Lorin Van Drie was not charged with health care fraud like his wife, but he was aware of the schemes and that the billing practices of his companies violated Medicaid regulations. He made no efforts to correct the unlawful situation.
$885,748 Health Care Fraud Conspiracy
Pamela Van Drie participated in a conspiracy to commit health care fraud from Oct. 6, 2010, to Aug. 19, 2015. This conspiracy consisted of two fraud schemes. Pamela Van Drie and Dr. James R. Dye, a dentist at the clinics, conspired to fraudulently bill Medicaid for speech aid prosthetics they did not provide to Medicaid beneficiaries. They also conspired to bill Medicaid for dentures and other dental services for beneficiaries who were ineligible to receive such services because the services were not medically necessary.
In addition to these two criminal conspiracies, Pamela Van Drie was found guilty of eight counts of health care fraud related to fraudulent claims for speech aid prosetheses and 10 counts of health care fraud related to fraudulent claims for dentures and other dental services.
Pamela Van Drie also was found guilty of one count of theft of public money related to $3,520 in unemployment benefits that she was not entitled to receive while working full-time at All About Smiles. From June 2012 through the end of December 2012, Medicaid paid into Pamela and Lorin Van Drie’s business bank account $750,000. Also during that time period, Pamela Van Drie took a weeklong vacation to a resort in Florida. Nonetheless, from June 2012 through January 2013, Pamela Van Drie falsely certified to the Missouri Department of Employment Security 31 times that she was not employed, was available and searching for work, and was not receiving any type of employment income.
Dye pleaded guilty on Feb. 11, 2016, to health care fraud in a separate but related case. According to court documents, the Missouri Dental Board suspended Dye’s license, a suspension that arose from his substandard care for patients at the Van Dries’s clinics.
This case was prosecuted by Assistant U.S. Attorneys Cindi S. Woolery and Steve Mohlhenrich and Special Assistant U.S. Attorney Shannon Kempf of the Missouri Attorney General’s Office. It was investigated by Health and Human Services – Office of Inspector General, the Missouri Attorney General’s Office Medicaid Fraud Control Unit and IRS-Criminal Investigation.