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Kickback Schemes Lead To Several Recent Prison Sentences Across U.S.


A kickback scheme is a fraudulent arrangement where one party provides something of value, such as money, gifts or services, to another party in exchange for favorable treatment or services rendered. Kickback schemes are illegal because they undermine the principles of fair competition and equal opportunity. They can also result in inflated prices, as the cost of the kickback is often passed on to the end customer.


The U.S. government has several laws that prohibit kickbacks. They include the Anti-Kickback Statute, which applies to federal healthcare programs. There is also the Foreign Corrupt Practices Act, which prohibits bribery of foreign officials. Penalties for violating these laws can include fines, imprisonment and exclusion from government contracts.


Wisconsin pharmacy owner receives 18-month prison sentence.


Last Tuesday, Alexander Shister was sentenced to 18 months in prison for paying healthcare kickbacks. The Mequon, Wisconsin resident was also ordered to pay close to $1 million in restitution to Medicare and Medicaid as well as a $40,000 fine. The owner of four pharmacies in the Milwaukee area, Shister began his nearly two-year kickback scheme in 2016. During that time, he paid his co-defendant, David Guerrero kickbacks in exchange for referrals.


As reported by the Eastern District of Wisconsin branch of the U.S. Attorney's Office last Friday, the kickbacks were rewards for having Medicare and Medicaid patients sent to Shister’s pharmacies for expensive compound pain creams. For each patient referral, Guerrero was paid $100. Although he was not a licensed medical provider, Guerrero worked at two Milwaukee-area clinics. He used his access at the clinics to order the pain creams from Shister’s pharmacies, often without the patients’ knowledge or consent.


“As a result of the scheme, Medicare and Medicaid paid Shister’s pharmacies about $1 million for medically unnecessary pain creams, including creams not even received by patients,” reports the U.S. Attorney's Office, “Shister paid Guerrero over $100,000 in kickbacks during the scheme. Guerrero was previously sentenced to 32 months’ imprisonment for his role in the kickback scheme with Shister as well as a second kickback scheme involving a local medical laboratory company.”


Shister is now excluded from participation in the Medicare and Medicaid programs. As well, he has shut down or sold his pharmacies.


Two Texas nurses imprisoned for their roles in kickback schemes.


This past Monday, 59 year-old, Joseph Nwankwo and 51 year-old Stacey Ajaja were given prison sentences following their guilty pleas to paying and receiving illegal health care kickbacks. The Houston, Texas-area residents admitted to paying kickbacks to marketers and a physician. Nwankwo has received a 36-month prison sentence and must pay $1,218,615.13 in restitution to Medicare. Ajaja will serve 14 months in prison and pay $238,164.69.


As reported by the Southern District of Texas branch of the U.S. Attorney's Office, the duo co-owned Hefty Healthcare Services Inc. “At the time of their pleas, they admitted that from 2014 through 2016, both obtained patient referrals by paying marketers and patients,” details the report, “Nwankwo further admitted to bribing a physician to authorize medically unnecessary home health services for Hefty patients.”


Are you an attorney who is currently working a health care fraud case?


The clinical experts at Allegiant Experts can help you! Contact us today to schedule a complimentary consultation. Please don’t hesitate to give us a call at 407-217-5831. You may also email us at info@allegiantexperts.com.

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