Owner of Brooklyn Clinic Pleads Guilty in Connection with $71 Million Medicare Fraud Scheme

WASHINGTON—The owner and manager of a Brooklyn, New York, health care clinic pleaded guilty today in federal court for her role in a $71 million Medicare fraud and money laundering scheme, announced Lanny A. Breuer, Assistant Attorney General of the Department of Justice Criminal Division; Loretta E. Lynch, U.S. Attorney for the Eastern District of New York; George Venizelos, Assistant Director in Charge, FBI, New York Field Office; and Thomas O’Donnell, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG).

Irina Shelikhova, a Ukranian national and formerly a resident of Brooklyn and Staten Island, New York, pleaded guilty before U.S. District Judge Nina Gershon in the Eastern District of New York to one count of conspiracy to commit money laundering.

Shelikhova was an owner and manager of a clinic in Brooklyn that operated under three corporate names: Bay Medical Care PC, SVS Wellcare Medical PLLC, and SZS Medical Care PLLC (Bay Medical Clinic). According to court documents, owners, operators, and employees of Bay Medical paid cash kickbacks to Medicare beneficiaries and used the beneficiaries’ names to bill Medicare for more than $71 million in medical services and procedures that were medically unnecessary or never provided, including physician office visits, physical therapy, and diagnostic tests.

According to the criminal complaint, the co-conspirators allegedly paid kickbacks to corrupt Medicare beneficiaries in a room at the clinic known as the “kickback room,” in which the conspirators paid approximately 1,000 kickbacks totaling more than $500,000 during a period of approximately six weeks from April to June 2010.

Shelikhova and her alleged co-conspirators used various companies to launder the proceeds of the health care fraud and to generate the cash needed to pay the kickbacks.

In July 2010, two days after numerous co-conspirators were arrested in connection with this matter and with an outstanding warrant for her arrest, Shelikhova fled to Ukraine. She voluntarily returned to the United States in June 2012.

At sentencing, Shelikhova faces a maximum penalty of 20 years in prison. Sentencing is scheduled for March 20, 2013.

In total, 16 individuals have been charged in the Bay Medical scheme, including two doctors, nine clinic owners/operators/employees and five external money launderers. To date, 12 defendants have pleaded guilty for their roles in the conspiracy. Four defendants await trial before Judge Gershon on January 22, 2013. As to those defendants, they are presumed innocent unless and until proven guilty.

The case is being prosecuted by Assistant U.S. Attorney Shannon Jones of the Eastern District of New York and Trial Attorney Sarah Hall of the Criminal Division’s Fraud Section. The case was investigated by the FBI and HHS-OIG.

The case was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York. The Medicare Fraud Strike Force operations are part of the Health Care Fraud Prevention and Enforcement Action Team (HEAT), a joint initiative announced in May 2009 between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,480 defendants who have collectively billed the Medicare program for more than $4.8 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, is taking steps to increase accountability and decrease the presence of fraudulent providers.

To learn more about the Health Care Fraud Prevention and Enforcement Action Team (HEAT), go to www.stopmedicarefraud.gov.