South Florida Brothers Sentenced In Addiction Treatment Fraud Scheme


Substance abuse and drug addiction are major life problems for millions of Americans. The Allegiant Experts Blog has covered numerous stories about our nation’s opioid crisis. And, this week, we look at another aspect of drug addiction that is plaguing our nation. Brothers, Jonathan and Daniel Markovich operated several addiction treatment facilities in South Florida. Last week, they were sentenced to prison for a $112 million addiction treatment fraud scheme.


The Markovichs both paid out and received kickbacks.


As reported by the United States Department of Justice, 37 year-old Jonathan and 33 year-old Daniel Markovich paid kickbacks to patients through patient recruiters. They also received kickbacks from testing laboratories. Evidence presented at their November 2021 trial showed that the defendants conspired to unlawfully bill for addiction treatment services to the tune of about $112 million. The services were found to be medically unnecessary and/or never provided.


As well, the treatments were procured through illegal kickbacks at two addiction treatment facilities. One was Second Chance Detox LLC (operating as Compass Detox), which is an inpatient detox and residential facility. The other was WAR Network LLC (operating as WAR), which is a related outpatient treatment program.


“The defendants obtained patients through patient recruiters who offered illegal kickbacks to patients, including free airline tickets, illegal drugs, and cash payments,” explains the DoJ report, “The defendants shuffled a core group of patients between Compass Detox and WAR in a cycle of admissions and re-admissions to fraudulently bill for as much as possible.”


Patient recruiters gave patients illegal drugs.


This was done prior to the patients’ admissions to Compass Detox. The drugs ensured that the patients could be admitted to the facility for detox. This type of addiction treatment, notes the DoJ, happens to be the most expensive kind offered by the defendants’ facilities. As well, therapy sessions were billed. However, these sessions were not regularly provided or attended. In addition, excessive, medically unnecessary urinalysis drug tests were ordered, billed for and paid.


“Compass Detox patients were given a so-called ‘Comfort Drink’ to sedate them, and to keep them coming back,” details the report, “Patients were also given large and potentially harmful amounts of controlled substances, in addition to the ‘Comfort Drink,’ to keep them compliant and docile, and to ensure they stayed at the facility.”


The Markovichs were convicted after a 7-week trial.


Officially, the brothers were found guilty of conspiracy to commit health care fraud and wire fraud. Jonathan Markovich was convicted of eight counts of health care fraud. Daniel Markovich was convicted of two counts of health care fraud. The brothers were also both convicted of conspiracy to pay and receive kickbacks and two counts of paying and receiving kickbacks. Jonathan received 188 months in prison while Daniel was sentenced to 97 months in prison.


“Jonathan Markovich was also separately convicted of conspiring to commit money laundering, two counts of concealment money laundering, and six counts of laundering at least $10,000 in proceeds of unlawful activities,” the DoJ concludes, “He was also convicted of two counts of bank fraud related to fraudulently obtaining PPP loans for both Compass Detox and WAR during the COVID-19 pandemic.”


Are you an attorney working on a fraud case? Allegiant Experts can help you! Contact us today to schedule a complimentary consultation. Call us at 407-217-5831. You may also email us at info@allegiantexperts.com.

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