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THREE CHARGED IN $180 MILLION HEALTH CARE FRAUD AND MONEY LAUNDERING SCHEME
WASHINGTON – An indictment against three individuals for their alleged involvement in various schemes to defraud Medicare, TRICARE, and private insurance companies, and their conspiracy to launder the proceeds has been unsealed. The conduct allegedly resulted in more than $180 million in fraudulent billings.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Mike Hurst of the Southern District of Mississippi, Special Agent in Charge Michelle Sutphin of the FBI’s Jackson Field Office, and Special Agent in Charge Cyndy Bruce of the Defense Criminal Investigative Service (DCIS) Southeast Field Office made the announcement.
Mitchell “Chad” Barrett, 54, of Gulf Breeze, Florida, David “Jason” Rutland, 41, of Bolton, Mississippi, and Thomas “Tommy” Shoemaker, 56, of Rayville, Louisiana were charged on May 27, 2020, in the Southern District of Mississippi.
The indictment alleges that between September 2011 and January 2016, Barrett, Rutland, and Shoemaker conspired to and engaged in a scheme to defraud numerous health care benefit programs of more than $180 million, including more than $50 million from federal healthcare programs. Using several pharmacies, including Gluckstadt Special Care Pharmacy and Compounding LLC, World Health Industries Inc., Opus Rx LLC, and Rx Pro Pharmacy and Compounding LLC, the defendants, as alleged, fraudulently formulated, dispensed, shipped, and billed insurance companies for compound medications in the form of topical creams and capsules, some of which contained controlled substances.
To further facilitate their scheme to defraud health care benefit programs, the defendants allegedly conspired to and engaged in a scheme to solicit and pay kickbacks and bribes to marketers, physicians, other medical providers, and beneficiaries to refer, prescribe, and receive prescriptions for medically unnecessary compound medications. The defendants also allegedly conspired to and engaged in a scheme to launder the proceeds of their fraudulent activity by concealing the proceeds they obtained and conducting monetary transactions of a value greater than $10,000, including the purchase of numerous assets, such as real estate, luxury automobiles, a three-carat diamond, and other high-priced goods.
The charges announced today target alleged schemes billing Medicare, TRICARE (a health insurance program for members and veterans of the armed forces and their families) and private insurance companies for medically unnecessary compounded medications.
The charges and allegations contained in the indictments are merely accusations. The defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
This case is being investigated by the FBI, DCIS, and IRS-CI. The U.S. Postal Inspection Service and Office of Personnel Management’s Office of Inspector General also assisted with the case. Trial Attorneys Emily Cohen, Amanda Wick, and Steven Brantley of the Criminal Division’s Money Laundering and Asset Recovery Section and Assistant U.S. Attorney Kathlyn Van Buskirk of the Southern District of Mississippi are prosecuting the case with the support and assistance of Trial Attorney Dustin Davis of the Fraud Section.
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