Former Owner of Daytona Beach Clinic Pleads Guilty to Fraud, Conspiracy, and Money Laundering

ORLANDO, FL—United States Attorney Robert E. O’Neill announces that Joseph Wagner (62, Daytona Beach) today pleaded guilty to health care fraud, conspiracy to illegally distribute prescription drugs, and money laundering. Wagner faces a maximum penalty of 30 years in federal prison. He was indicted on June 13, 2012.

According to the plea agreement, Wagner was a licensed chiropractor and owner of Wagner Chiropractic and Acupuncture Clinic (WCAC) in Volusia County, Florida. He operated WCAC as a facility that purported to provide chiropractic and other medical services to customers. On occasion, Wagner did provide chiropractic services to customers of WCAC. However, he also submitted inflated bills to public and private health care beneficiary programs, including Medicare. Wagner charged those programs at the higher rates for services rendered by medical doctors, instead of the rates appropriate for chiropractors. In addition, Wagner systematically submitted claims for reimbursement for services not rendered.

As part of the fraud scheme, Wagner submitted fraudulent billings in the names of medical doctors. By doing so, the health care beneficiary programs would make payments directly to those medical doctors. The doctors accepted those payments and would often split the fraudulently obtained insurance payments with Wagner. In the case of at least one medical doctor participating in the fraudulent scheme, Wagner received payments from the health care beneficiary programs by check and then deposited those checks into the medical doctor’s bank account.

Wagner also provided customers of WCAC with prescriptions for prescription drugs, often in return for cash payments. Since he could not prescribe controlled substances, Wagner provided prescriptions for controlled substances to customers of WCAC using the names of medical doctors who were aware that Wagner was using their names illegally. Many of the patients who obtained prescriptions for controlled substances through Wagner used their Medicaid coverage at pharmacies to pay for those controlled substances.

This case was investigated by the Federal Bureau of Investigation, Food and Drug Administration, Department of Health and Human Services Office of Inspector General, Florida Department of Financial Services, Florida Department of Health, and the Florida Department of Law Enforcement. It is being prosecuted by Assistant United States Attorney Daniel C. Irick.

Convicted Felon With Loaded Firearm and Drugs Sentenced to More Than 12 Years in Federal Prison

Orlando, Florida – United States District Judge Charlene Honeywell sentenced Ronald William Jones (25, Orlando) yesterday to 12 years and 8 months in federal prison for gun and drug violations. On March 16, 2012 a federal jury found Jones guilty of possession of a firearm by a convicted felon, possession of a firearm with an obliterated serial number, possession of crack cocaine with the intent to distribute, and possession of a firearm in furtherance of a drug trafficking crime.

According to testimony and evidence presented in court, Jones was apprehended by deputies from the Orange County Sheriff’s Office on February 8, 2010, after he was involved in a car accident while attempting to avoid a speeding checkpoint. After hitting a power pole with his car, Jones immediately fled the crash on foot, but was captured by deputies a short distance away. Inside of Jones’ car, deputies recovered a loaded semi-automatic handgun on the driver’s floorboard, a box of ammunition on the back seat, and a plastic container with 17.9 grams of crack cocaine in the dashboard. The serial number on the firearm had been intentionally removed. Jones subsequently admitted that the items in the car belonged to him. As a previously convicted felon for narcotics distribution, Jones is prohibited from possessing firearms or ammunition under federal law.

This case was investigated by the Orange County Sheriff's Office, the Florida Department of Law Enforcement (FDLE) and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). It was prosecuted by Assistant United States Attorney Robert E. Bodnar, Jr.

It is another case prosecuted as a part of the Department of Justice’s “Project Safe Neighborhoods” program – a nationwide, gun-violence reduction strategy led by ATF. United States Attorney Robert E. O’Neill, along with Virginia O’Brien, Special Agent in Charge, ATF, is coordinating the Project Safe Neighborhoods effort here in the Middle District of Florida in cooperation with federal, state, and local law enforcement officials.

Two Floridians Charged in Tax Refund Scheme Using Stolen Identities

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; José A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division (IRS-CID); Paula Reid, Special Agent in Charge, United States Secret Service (USSS), Miami Field Office; Henry Gutierrez, Postal Inspector in Charge, U.S. Postal Inspection Service, Miami Division; and Addy Villanueva, Florida Department of Law Enforcement, announced the unsealing of a 15-count indictment charging Sabrina Balkman-Bradwell, 47, formerly of Hialeah, Florida, and Edwin Bonannee, 32, of Hollywood, Florida, in connection with their participation in a tax refund scheme that used stolen identities. Balkman-Bradwell was arrested earlier today in Waverly, Florida and made her initial appearance in federal court before U.S. Magistrate Judge Elizabeth Jenkins in Tampa, Florida. Bonannee is expected to make his initial appearance later this week in Ft. Lauderdale before U.S. Magistrate Judge Barry Seltzer.

More specifically, the indictment charges the defendants with one count of conspiracy to defraud the government, four counts of mail fraud, five counts of stealing government funds (income tax refunds), and five counts of aggravated identity theft. If convicted, the defendants face a statutory maximum sentence of 10 years in prison on the conspiracy count, 20 years on the mail fraud counts, 10 years on the theft of government funds counts, and two years consecutive to the other sentences on the aggravated identity theft charges.

According to the allegations in the indictment, defendants Balkman-Bradwell and Bonannee obtained tax refunds to which they were not entitled by using, or recruiting others to use, stolen identities of real persons, including some deceased, to file for refund claims in the victims’ names. To execute the scheme, the defendants and others used stolen Social Security numbers and manufactured IRS Form W-2 Wage and Tax Statements with false employer information, income, and withholding amounts. The defendants used and recruited others to use the stolen and false documentation to prepare and cause the electronic filing of false U.S. Individual Income Tax Returns in the names of the identity theft victims. The defendants then caused the IRS to send the refund checks to addresses and bank accounts that they controlled.

In this way, defendants Balkman-Bradwell and Bonannee allegedly caused 32 false tax refund claims to be filed with the IRS. Many of these claims were filed via multiple Electronic Filing Identification Numbers, tax preparers, and business names. The defendants received tax refund checks totaling approximately $108,496.

The indictment also alleges that defendant Bonannee caused another 46 false claims for income tax refunds to be filed with the IRS and caused electronic deposits into bank accounts he controlled under the names DM Homeless Shelter LLC and D.B., totaling approximately $108,188.53. Defendant Balkman-Bradwell allegedly caused multiple false claims for income tax refunds to be filed with the IRS and obtained approximately 1,712 income tax refund checks and electronic deposits, totaling approximately $5,638,409.

Mr. Ferrer commended the investigative efforts of FBI, IRS-CID, U.S. Secret Service, U.S. Postal Inspection Service, and the Florida Department of Law Enforcement. Mr. Ferrer also thanked the Social Security Administration, Office of Inspector General, for its assistance in this matter. This case is being prosecuted by Assistant U.S. Attorney Neil Karadbil.

An indictment is only an accusation and a defendant is presumed innocent until proven guilty.

Former Daytona Beach Chiropractor Charged with Illegally Dispensing Prescription Drugs and Health Care Fraud

ORLANDO—United States Attorney Robert E. O’Neill announces that the United States has filed a criminal complaint charging Joseph Wagner (62, Daytona Beach) with illegally dispensing and distributing prescription drugs and health care fraud. If convicted, Wagner faces a maximum penalty of 10 years in federal prison for each charge.

According to court documents, in 2009, the Personal Injury Protection Fraud Squad of the Florida Department of Financial Services opened an investigation into Wagner Chiropractic and Acupuncture Clinic (WCAC) after receiving complaints about WCAC from the Special Investigative Units of several private automobile insurance carriers. These complaints involved charges submitted to the insurance carriers by WCAC for medical and chiropractic services and treatments that had never taken place. In addition, investigators learned that Wagner, at the time a chiropractor who was not authorized to prescribe any drugs, submitted prescriptions for customers on pre-stamped or pre-signed prescription pads using the names of medical doctors, making each such prescription unlawful.

The Federal Bureau of Investigation (FBI) and other federal agencies adopted the investigation, and on August 4, 2011, agents executed a federal search warrant at WCAC. Following the execution of the search warrant, in August 2011, the Florida Department of Health served Wagner with an Emergency Suspension Order, and his Florida chiropractic licensed was revoked.

According to interviews conducted by the FBI and other federal agencies, none of the WCAC customers had ever been treated or examined by anyone other than Wagner or, in some instances, by Wagner’s son. Yet those customers had received prescriptions for controlled substances, primarily Lortab (Hydrocodone) and Xanax, from medical doctors who had never examined or treated the customers. All of the prescriptions were relayed to various local pharmacies in the Daytona Beach area by telephone or facsimile after the customers had been to WCAC and had seen Wagner. Customers who did not have any type of health insurance paid Wagner $100 cash, every month, and received a monthly prescription for controlled substances, as well as a “back crack” from Wagner.

Other customers, who were on Social Security disability and were covered by Medicare, received weekly prescriptions for controlled substances in the same manner. However, their Medicare coverage was billed for treatments provided by a medical doctor who had never treated or examined them. Still other customers, who were covered by a private health insurance plan, were provided weekly prescriptions for controlled substances, again relayed either by telephone or facsimile to local pharmacies. The prescriptions were issued by a medical doctor who had never treated or examined the customers, and the customers’ private health insurance plans were billed in the name of doctors who had never treated or examined the customers.

A criminal complaint is merely a charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.

This case was investigated by the Federal Bureau of Investigation; the Food and Drug Administration; U.S. Department of Health and Human Services, Office of Inspector General; the Florida Department of Financial Services; the Florida Department of Health; and the Florida Department of Law Enforcement. It will be prosecuted by Assistant United States Attorney Daniel C. Irick.

Broward Man Pleads Guilty for His Participation in Versailles Mortgage Fraud Scheme

More Than 30 Defendants Have Been Sentenced in the Past Five Years in Connection with Mortgage Fraud Schemes at Versailles Development

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; José A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division (IRS-CID); Paula Reid, Special Agent in Charge, U.S. Secret Service;, Jeff Atwater, Chief Financial Officer, Florida’s Department of Financial Services; Addy M. Villanueva, Special Agent in Charge, Florida Department of Law Enforcement (FDLE); Linda Charity, Interim Commissioner, State of Florida’s Office of Financial Regulation; and the Palm Beach County Mortgage Fraud Task Force announced that defendant Juan Carlos Rodriguez, 52, a real estate agent and mortgage broker from Weston, Florida, pled guilty today before U.S. District Judge Kenneth A. Marra for his participation in a mortgage fraud scheme relating to properties in the Versailles development in Wellington, Florida. Sentencing for Rodriguez has been scheduled for July 27, 2012.

Rodriguez pled guilty to conspiracy to commit mail fraud, wire fraud, and financial institution fraud, in violation of Title 18, United States Code, Section 1349, and conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h).

Over the last five years, more than 30 defendants have been prosecuted for mortgage fraud schemes in the Versailles neighborhood. Most recently, in addition to Rodriguez, eight other individuals have pled guilty and been sentenced in four related mortgage fraud schemes that were centered in Versailles. They are:

Defendant David Lam, 42, a real estate agent from Parkland, Florida, pled guilty on January 17, 2012 to charges in four separate indictments. More specifically, he pled guilty to four counts of conspiracy to commit mail and wire fraud, in violation of Title 18, United States Code, Section 1349, and three counts of conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h). In sum, the schemes alleged in the four indictments involved more than $15 million in mortgage loans on 12 Versailles properties and more than $5 million in fraudulent loan proceeds. Lam was sentenced on April 20, 2012 by U.S. District Judge Kenneth A. Marra to 42 months in prison, to be followed by two years of supervised release. The court also ordered Lam to pay $7,117,000 in restitution.

Defendant Pamela Higgins, a mortgage broker who lived in Arizona at the time of the offense, pled guilty on November 4, 2011 to one count of conspiracy to commit mail fraud, wire fraud, and financial institution fraud, in violation of Title 18, United States Code Section 1349, and one count of conspiracy to commit money laundering, in violation of Title 18, United States Code Section 1956(h). Higgins was sentenced by U.S. District Judge Kenneth A. Marra on February 10, 2012 to 36 months in prison, to be followed by two years of supervised release. Higgins was ordered to pay $2,141,536 in restitution.

Defendant Carl Alexander, 45, of Parkland, Florida, pled guilty on October 5, 2011 to one count of conspiracy to commit mail and wire fraud, in violation of Title 18, United States Code, Section 1349, and one count of conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h). He was sentenced on January 6, 2012 by U.S. District Judge Kenneth A. Marra to 48 months in prison, to be followed by three years of supervised release. The court also ordered Alexander to pay $3,576,724 in restitution.

Defendant Carol Asbury, 59, an attorney and title agent in Lake Worth, Florida, pled guilty on September 9, 2011 to two counts of conspiracy to commit mail and wire fraud, in violation of Title 18, United States Code, Section 1349, and two counts of conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h). Asbury was charged and pled guilty to charges in two indictments, both of which alleged mortgage fraud in the Versailles development. Asbury was sentenced on November 18, 2011 by U.S. District Judge Kenneth A. Marra to 30 months in prison, to be followed by three years of supervised release. She was also ordered to pay $6,510,291 in restitution.

Defendant Patrick Brinson, 34, of Miami, Florida, pled guilty on September 7, 2011 to two counts of conspiracy to commit mail and wire fraud, in violation of Title 18, United States Code, Section 1349, and one count of conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h). Brinson pled guilty to charges in two indictments, one of which alleged mortgage fraud in Versailles and one of which alleged a separate mortgage fraud scheme in Miami. Brinson was sentenced on November 29, 2011 by U.S. District Judge Patricia A. Seitz to 78 months in prison, to be followed by three years of supervised release. He was also ordered to pay $1,602,250 in restitution.

Defendant Victoria Wilson, 30, a mortgage broker from Hollywood, Florida, pled guilty on August 19, 2011 to one count of conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 1349. Wilson was sentenced on November 30, 2011 by U.S. District Judge Kenneth A. Marra to 24 months in prison, to be followed by two years of supervised release. Wilson was ordered to pay $1,655,466 in restitution.

Defendant David Charles Miller, Jr., 44, Miramar, Florida, pled guilty on February 3, 2012 to one count of conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 1349. Miller was sentenced on April 20, 2012 by U.S. District Judge Kenneth A. Marra to 27 months in prison, to be followed by two years of supervised release. Miller was ordered to pay $1,655,466 in restitution.

Defendant Thomas Thelusma, 41, a Miami firefighter from Biscayne Park, Florida, pled guilty on February 2, 2012 to one count of conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 1349. Thelusma was sentenced on April 20, 2012 by U.S. District Judge Kenneth A. Marra to 18 months in prison, to be followed by two years of supervised release. Thelusma was ordered to pay $1,035,000 in restitution.

According to court documents, in all four of the recent Versailles-related indictments, the defendants used “straw buyers” to submit false documentation to various mortgage lenders substantially inflating the purchase price of the properties. As part of the conspiracy, duplicate HUD-1 Settlement Statements were prepared. One set, listing the real price, was provided to the seller; another set, with the inflated price, was provided to the lender. The difference between the real price and the inflated price was either made to appear as if it were a debt owed to business entities controlled by the defendants and their co-conspirators or was made to appear as profits to the seller. The fraudulent loan proceeds were then laundered through multiple accounts to conceal the source and distribution of the money and were ultimately used for the benefit of the defendants and their co-conspirators.

Mr. Ferrer commended the investigative efforts of the FBI, IRS-CID, U.S. Secret Service, Florida’s Department of Financial Services and Office of Financial Regulation, FDLE, and the Palm Beach County Mortgage Fraud Task Force. The cases are being prosecuted by Assistant U.S. Attorneys Stephanie Evans, Ellen Cohen, Carolyn Bell, and Armando Rosquete.