October 14, 2010.
In what U.S. government officials are calling the largest Medicare fraud scheme to come to light, 73 people were indicted Wednesday and charged with a variety of healthcare fraud-related crimes that involve more than $163 million in fraudulent billing.
The indictments were unsealed in five judicial districts and include a number of alleged members and associates of an Armenian-American crime syndicate, according to Acting Deputy Attorney General Gary G. Grindler, FBI Assistant Director of the Criminal Investigative Division Kevin Perkins and Health and Human Services Inspector General Daniel R. Levinson.
The indictments allege that the defendants stole the identities of thousands of Medicare beneficiaries and numerous doctors and used the names to establish 118 shadow clinics in 25 states, all created for the sole purpose of submitting phony Medicare claims.
“The emergence of international organized crime in domestic healthcare fraud schemes signals a dangerous expansion that poses a serious threat to consumers as these syndicates are willing to exploit almost any program, business or individual to earn an illegal profit,” said Grinder in announcing the indictments.
At the heart of the indictments, federal officials said, is an organized crime enterprise known as the Mirzoyan-Terdjanian Organization, so named for principal leaders Davit Mirzoyan and Robert Terdjanian.
According to the charges filed in U.S. District Court in the Southern District of New York, the criminal organization had bases of operations in New York and Los Angeles.
A report by the Associated Press noted that Mirzoyan, of Glendale, Calif., and Terdjanian, of Brooklyn, N.Y., were taken into custody on Wednesday. Terdjanian was jailed without bail by a New York judge Wednesday morning. Charges against the ring leaders include racketeering, money laundering, bank fraud and identity theft.
The nature of the case is different than the typical method used to defraud Medicare – in which clinics recruit beneficiaries and bribe them to allow billing Medicare for treatments that are unneeded. According to investigators, this group created phantom clinics and used the stolen doctor and Medicare member identities to bill the agency.
According to the AP report, investigators were alerted by incongruous claims – eye doctors doing bladder tests, ear, nose and throat specialists performing pregnancy ultrasounds, obstetricians testing for skin allergies and dermatologists billing for heart exams.
“The international organized crime enterprise known as the Mirzoyan-Terdjanian fleeced the healthcare system through a wide range of money-making criminal fraud schemes,” said Perkins. “The members and associates located throughout the United States and in Armenia perpetrated a large-scale, nationwide Medicare scam that fraudulently billed Medicare for more than $100 million of unnecessary medical treatments using a series of phantom clinics. We want to restore the confidence in the nation’s healthcare system and assure practitioners we will not stand by and let their identities be used for criminal gain.”
