Physician Assistant Agrees to Pay $620, 500 for Allegedly Engaging in Illegal Kickback Scheme

A Louisiana physician assistant entered into settlement agreement this week with the U.S. Attorney’s Office for allegedly accepting illegal payments from OK Compounding, LLC, in return for recommending and prescribing compounded drugs produced by the pharmacy, announced U.S. Attorney Trent Shores.

Stephen Ryan Honeycutt, 44, agreed to pay the government $620,508.36 for allegedly accepting the illegal kickback payments from Jan. 8 through June 10, 2013, while practicing at Bone & Joint Clinic in Marrero, Louisiana. The settlement agreement resolves allegations that Honeycutt had illegal financial relationships with OK Compounding concerning pain creams.

“Stephen Honeycutt knowingly violated the ethical standards he swore to uphold. He did not pursue courses of treatment based on his patients’ needs, he did so based on his greed for profit,” said U.S. Attorney Trent Shores. “My office is committed to ensuring federal health care dollars are spent in accordance with the law and will not tolerate the deliberate misuse of federal health care programs.”

Honeycutt prescribed pain creams for his patients, facilitating the sale and distribution of the creams.  As compensation for his services, OK Compounding paid Honeycutt what was characterized by the parties as “medical director fees” based upon an hourly rate.  However, the payments he received from OK Compounding were, in actuality, “kickbacks.” Because some of the patients were insured by Medicare and TRICARE, federal health insurance programs, the kickbacks were in violation of the False Claims Act. It is illegal to pay or receive “kickbacks” in conjunction with federal healthcare insurance.

Prohibitions against kickbacks are crucial to ensure that financial motives do not undermine the integrity of the medical judgment of physicians and other health care providers.  The civil False Claims Act is an important tool used to protect the integrity of taxpayer-funded health care programs against health care providers.

This matter was handled by Assistant U.S. Attorney Marianne Hardcastle with the Affirmative Civil Enforcement unit and is the product of the collaborative investigative efforts of the Defense Criminal Investigative Service, Department of Labor–Office of Inspector General (OIG), IRS–Criminal Investigation, U.S. Postal Service–OIG, FBI, Department of Veterans Affairs–OIG and the Department of Health and Human Services–OIG.

The claims resolved by the settlement are allegations only; there has been no determination of liability.

Atlanta-area Man Arrested for Drug Trafficking in Brattleboro

The Office of the United States Attorney for the District of Vermont announced that Leroy Brown, Jr., 41, of McDonough, Georgia, was arrested yesterday after having been charged with multiple counts of distribution of cocaine base, a Schedule II drug.  Brown appeared before the Honorable John M. Conroy, United States Magistrate Judge, and was released on conditions.

According to court records, the Vermont State Police’s Southeastern Vermont Drug Task Force began investigating Brown in December of 2019, and, in January of 2020, was joined in the investigation by the Federal Bureau of Investigation.  Law enforcement conducted multiple controlled purchases of cocaine base from Brown at the Econo Lodge in Brattleboro, Vermont.  Specifically, on January 27, 2020, a cooperating individual purchased approximately 11 grams of cocaine base from Brown inside Brown’s room at the Econo Lodge.  On March 13, 2020, the cooperating individual purchased approximately 9 grams of cocaine base, also while inside Brown’s motel room.

If convicted, Brown faces a maximum of twenty years of imprisonment on each count.  The actual sentence however, would be determined by the Court with guidance from the advisory Federal Sentencing Guidelines.  The United States Attorney emphasizes that the charges in the complaint are merely accusations, and that the defendant is presumed innocent unless and until he is proven guilty.

United States Attorney Christina E. Nolan commended the investigative efforts of the Vermont State Police and the Federal Bureau of Investigation.  She stated: “We remain ever vigilant in our efforts to root out drug trafficking in every corner of the state.  Those who would attempt to profit from addiction or despair will be held accountable – in this time of emergency as always.”

The United States is represented in this matter by Assistant U.S. Attorney Jonathan Ophardt.  Defendant Brown is represented by the Office of the Federal Public Defender.

Chinle Man Sentenced to Life in Prison for Sexually Abusing Two Young Girls

PHOENIX, Ariz. – On March 16, Jarett James, 34, of Chinle, Ariz., was sentenced by U.S. District Judge Steven P. Logan to life imprisonment after being convicted of sexually abusing two girls between the ages of 10 and 12. The crimes took place on the Navajo Nation Indian Reservation in 2011 and 2012.

On October 18, 2019, a jury found James guilty of one count of Aggravated Sexual Abuse of a Child, two counts of Abusive Sexual Contact of a Child, and one count of Sexual Abuse of a Minor.

The Federal Bureau of Investigation conducted the investigation in this case. Assistant U.S. Attorney Tracy Van Buskirk, District of Arizona, Phoenix, handled the prosecution.

CASE NUMBER:         CR-18-08249-PCT-SPL

RELEASE NUMBER:    2020-037_James