Charlotte Woman Arrested for $650,000 Medicaid Fraud Scheme
Defendant Allegedly “Rented Out” Her Medicaid Provider Number to Co-Conspirators; Another Defendant Pleads Guilty to a Similar Medicaid Fraud Scheme

CHARLOTTE, NC—A Charlotte woman charged with defrauding Medicaid of at least $650,000 was arrested in Goldsboro, North Carolina, today, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.

Charlotte Elizabeth Garnes, 37, of Charlotte was charged in a federal indictment returned by a grand jury in Charlotte on August 21, 2012, with one count of health care fraud conspiracy and one count of obstruction of official proceedings. The criminal bill of indictment, which was unsealed today, also includes a forfeiture allegation seeking a money judgment in the amount of at least $664,247.

U.S. Attorney Tompkins is joined in making today’s announcement by Attorney General Roy Cooper, who oversees the North Carolina Medicaid Investigations Division (MID), and Derrick Jackson, Special Agent in Charge, Department of Health and Human Services-Office of the Inspector General (HHS-OIG), Office of Investigations, Atlanta Region.

According to allegations in the indictment, Garnes participated in a scheme to defraud Medicaid by seeking and receiving payments for services that she did not perform. Filed court documents indicate that Garnes, who is a licensed professional counselor, has a Medicaid provider number that enables her to provide mental and behavioral health services to Medicaid participants. The indictment alleges that Garnes “rented out” her Medicaid provider number so that other unqualified individuals could submit fraudulent reimbursement claims for mental and behavioral health services to Medicaid through Garnes’s number.

According to allegations in the indictment, from March 2009 to April 2011, Garnes conspired with two individuals, Teresa Marible and Michele Jackson, to allow Marible and Jackson to submit fraudulent claims to Medicaid through Garnes’s company, Charlotte’s Insight Inc. Allegations contained in the indictment state that Garnes kept a percentage of the Medicaid reimbursement received for those claims. The indictment also alleges that neither Marible nor Jackson were licensed to provide mental and behavioral health services and therefore could not seek reimbursement from Medicaid. Garnes, therefore, falsely listed herself as the attending clinician for these claims even though she did not provide any of the claimed services.

In addition, the indictment alleges that during the relevant time period, Garnes also worked for a defense contractor at military bases and, in some instances, Garnes was not even in the country at the time that she claimed to have provided the Medicaid services. According to allegations in the indictment, Garnes also submitted and received payment for claims totaling more than 24 hours of services provided in a single day. In one instance in December 2009, Garnes represented that she provided 69 hours of mental and behavioral health services on a single day, the indictment alleges. According to the indictment, Garnes, Marible, and Jackson also submitted claims for several Medicaid beneficiaries who did not receive any services at all. The indictment alleges that the fraudulent scheme caused Medicaid to pay out to Garnes and her co-conspirators over $650,000 as a result of the false claims.

On August 2, 2012, Oriaku Hampton Sowell, 39, of Charlotte, pleaded guilty to her role in this scheme involving Garnes. According to filed court documents, Sowell conspired with Garnes, Marible, and Jackson to defraud Medicaid in an identical arrangement where Sowell rented out her Medicaid provider number. These reimbursement claims falsely listed Sowell as the attending clinician when she, in fact, did not provide the claimed services. Court records indicate that in exchange for the use of her Medicaid number, Sowell retained a percentage of the Medicaid reimbursement and paid the remainder to Jackson and Marible. From October 2010 to April 2011, the fraudsters collected at least $250,000 from Medicaid.

Marible was sentenced in June 2012 to serve 36 month in prison for her role in the scheme and was ordered to pay $1,135,662 in restitution. Jackson was sentenced in March 2012 to 15 months in prison and was ordered to pay $292,282 in restitution.

Garnes had her initial appearance today in U.S. District Court in Raleigh. If convicted, Garnes faces a statutory maximum sentence of 10 years in prison and a $250,000 fine for count one. Count two carries a statutory maximum sentence of 20 years in prison and a $250,000 fine. An indictment is merely an allegation, and Garnes is presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law.

In a separate but similar Medicaid fraud scheme, Gregory Benny Lassiter, 31, of Charlotte, entered a plea of guilty on August 17, 2012, for committing health care fraud conspiracy. According to the charging document and plea agreement filed in this case, Lassiter rented out his Medicaid provider number to allow a co-conspirator, Erika Holland, to submit fraudulent claims through his company, VisionOne Health Services (“VisionOne”). Holland was not licensed to provide mental and behavioral health services, and she did not employ any licensed therapists to perform such services. Lassiter, nevertheless, agreed to rent out his Medicaid provider number for the purpose of allowing Holland to submit fraudulent claims. Lassiter retained a percentage of the Medicaid reimbursement.

Similar to the schemes described above, the claims submitted falsely listed other licensed providers as the attending clinician, filed documents state. For example, Lassiter employed Dr. M.T. at VisionOne for a brief period of time, but Dr. M.T. did not provide any services to clients. According to court records, after Dr. M.T. left VisionOne, Lassiter fraudulently used Dr. M.T.’s Medicaid provider number to bill for services that Dr. M.T. did not provide. Some of the fraudulent claims submitted by Holland through Lassiter’s number fraudulently listed Dr. M.T. as the attending clinician. According to the charging document, from October 2010 to April 2011m Lassiter received in excess of $200,000 in fraudulent payments from Medicaid pursuant to the schemes.

Holland was sentenced in March 2012 to serve 54 months in prison and was ordered to pay $1,585,093 in restitution for this and other fraudulent schemes involving Medicaid. Lassiter faces a statutory maximum prison sentence of 10 years and a $250,000 fine. Lassiter was released on bond in August 2012 and awaits sentencing.

The investigations into Garnes and Lassiter were handled by HHS-OIG and MID. IRS assisted with Garnes’s investigation, and the FBI with Lassiter’s. The prosecution of both cases is handled by Assistant U.S. Attorney Kelli Ferry of the U.S. Attorney’s Charlotte Office.

The investigation and charges are the work of the Western District’s joint Health Care Fraud Task Force. The Task Force is multi-agency team of experienced federal and state investigators, working in conjunction with criminal and civil Assistant United States Attorneys, dedicated to identifying and prosecuting those who defraud the health care system and to reducing the potential for health care fraud in the future. The task force focuses on the coordination of cases, information sharing, identification of trends in health care fraud throughout the region, staffing of all whistle blower complaints, and the creation of investigative teams so that individual agencies may focus their unique areas of expertise on investigations. The task force builds upon existing partnerships between the agencies, and its work reflects a heightened effort to reduce fraud and recover taxpayer dollars.

If you suspect Medicare or Medicaid fraud, please report it by phone at 1-800-447- 8477 (1-800-HHS-TIPS) or e-mail at HHSTips@oig.hhs.gov.